Severance Agreement - eRoom Technology Inc. and Robert L. Lentz
eROOM TECHNOLOGY, INC. LETTERHEAD
September 6, 2000
Robert L. Lentz
93 Lake Road Terrace
Wayland, MA 01778
Dear Bob:
This letter summarizes the terms of your severance agreement with eRoom
Technology, Inc. (together with any successors or assigns, the "Company"). Under
the terms of this Agreement, you may be eligible to receive severance pay upon
the termination of your employment with the Company if the conditions below are
met.
1. TERMINATION OF EMPLOYMENT.
(a) If there has been a Sale of the Company (as defined in the
Non-Qualified Option and Stock Repurchase Agreement between you and the Company
dated February 18, 2000 (the "Option Agreement")) and at or prior to the Sale of
the Company you are not offered continued employment by the successor to the
Company:
(i) at the same or higher total compensation level than in effect for
you as an employee of the Company prior to the Sale of the
Company,
(ii) consisting of responsibilities not materially reduced from the
level of responsibilities undertaken by you as an employee of the
Company prior to the Sale of the Company, AND
(iii) within a 40-mile radius of the Company's principal offices prior
to the Sale of the Company (except for business travel consistent
with your responsibilities as an employee of the Company)
AND your employment with the Company is terminated voluntarily by you or by the
Company without Cause (as defined in the Option Agreement) on, prior to or
within 3 months after the Sale of the Company then the Company shall provide the
severance set forth in Section 2 below.
(b) If there has been a Sale of the Company and you are offered and
accept continued employment meeting the criteria set forth in Section
1(a)(i)-(iii) above but, within the 12 months following the Sale of the
Company,
(i) your total compensation level is reduced below the total
compensation in effect for you as an employee of the Company
prior to the Sale of the Company,
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(ii) your responsibilities are materially reduced below the level of
responsibilities you had as an employee of the Company prior
to the Sale of the Company, OR
(iii) you are transferred by the Company to a location beyond a 40-mile
radius of the Company's principal offices prior to the Sale of the
Company (except for business travel consistent with your
responsibilities as an employee of the Company)
AND your employment with the Company is voluntarily terminated by you or by the
Company without Cause within three months of the occurrence of one of the events
described in Section 1(b)(i)-(iii) above, then the Company shall provide the
severance set forth in Section 2 below.
(c) If there has been a Sale of the Company and you are offered and
accept employment meeting the criteria set forth in Section 1(a)(i)-(iii) above
but, within the 12 months following the Sale of the Company, your employment
with the Company is terminated by the Company without Cause, then the Company
shall provide the severance set forth in Section 2 below.
2. SEVERANCE.
If the conditions set forth in Section 1(a) or 1(b) or 1(c) are met,
the following provisions shall be applicable:
(a) The Company shall pay you salary continuation at your then-current
base salary rate for a period of 6 months following the date of termination in
accordance with the Company's normal payroll practice, as may be modified by the
Company from time to time.
(b) The Company shall pay you a one-time payment equal to your targeted
bonus amount established by the Company payable for the year in which your date
of termination occurs; provided that such payment shall be pro rated to reflect
the number of days you have been employed by the Company during such year. (By
way of example, if your targeted bonus amount for the year 2000 is equal to 40%
of your base salary of $100,000 and you have worked until June 30, 2000 before
leaving the Company, the one-time payment under this subsection (b) would be
$20,000.) The payment set forth in this Section 2(b) shall be paid at the time
of the first regularly-scheduled payroll payment (in accordance with the
Company's normal payroll practice) following the date of your termination.
(c) The Company shall provide you the same benefits to which you are
eligible and are receiving at your termination date (to the extent permitted by
law and/or the terms and conditions of the applicable plan documents governing
such benefits) for a period of 6 months following the date of termination in
accordance with the Company's existing policies, as may be modified by the
Company from time to time.
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(d) Receipt by you of the foregoing payments will be conditioned on
your execution and delivery of a release in a form acceptable to the Company.
Moreover, the Company shall terminate all such payments if it determines that
you have violated any of the provisions contained in your Employee
Non-Disclosure and Developments Agreement or Non-Competition Agreement.
(e) If the Company in its discretion determines that it is obligated to
withhold any tax in connection with the payments or benefits provided in this
Section 2, you hereby agree that the Company may withhold from such
payments/benefits the appropriate amount of tax.
3. ACKNOWLEDGEMENT. You acknowledge that neither this Agreement nor any
other document you have signed regarding your employment with the Company
constitutes an implied or written contract for employment and/or constitutes a
promise for employment of a definite term or duration.
4. ENTIRE AGREEMENT. This Severance Agreement (together with the Option
Agreement) contains the entire agreement between you and the Company with
respect to the subject matter hereof, and supersedes any previous agreements or
contracts between them which relate to the subject matter hereof. No
representations, inducements, promises or agreements, oral or otherwise, which
are not embodied herein shall be of any force or effect and are null and void.
5. AMENDMENTS AND MODIFICATIONS. This Agreement may be amended or
modified only by a writing signed by you and the Company, which makes
specific reference to this Agreement.
6. GOVERNING LAW. The validity, interpretation, and performance of this
Agreement shall be construed and interpreted according to the laws of the
Commonwealth of Massachusetts, without giving effect to the principles of
conflicts of law thereof.
7. ASSIGNMENT. You may not assign any of your rights or delegate any of
your duties under this Agreement. The rights of the Company under this
Agreement shall inure to the benefit of and the obligations of the Company under
this Agreement shall be assumed by the successors and assigns of the Company.
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IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Severance Agreement as of this 6th day of September, 2000.
eRoom Technology, Inc.
/s/ Robert L. Lentz /s/ Jeffrey R. Beir
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Robert L. Lentz By: Jeffrey R. Beir
Title: President and CEO