EXHIBIT 10.1
EMPLOYMENT, CONFIDENTIALITY AND NONCOMPETITION AGREEMENT
(XXXXX X XXXXXX)
This Employment, Confidentiality and Noncompetition Agreement
("Agreement") is made and entered into effective this 23rd day of September,
1999, by and between XXXXXXXXXX.XXX, INC., a Delaware corporation ("Employer")
and XXXXX XXXXXX ("Employee").
In consideration of their mutual promises and covenants
contained herein, the receipt and legal sufficiency of which consideration is
hereby acknowledged, the parties hereby agree as follows:
1. EMPLOYMENT. Employer shall employ Employee and
Employee shall work for Employer in the employment position described in
Exhibit A hereto, which is hereby incorporated herein and made a part of this
Agreement. In this position, Employee shall perform all assigned duties,
comply with all employment policies, and willingly obey all rules,
regulations and special instructions that now exist or that may hereafter be
established by Employer from time to time. Employee shall render such
services and perform such duties at such places or in such areas or
territories as Employer shall direct. Employee warrants that all information
provided by Employee in applying for employment is true and correct.
2. STANDARD OF PERFORMANCE. Employee accepts
employment with Employer on the terms and conditions herein set forth.
Employee recognizes that Employee owes to Employer duties of loyalty,
fidelity and obedience in all matters pertaining to such employment. Employee
agrees to serve Employer diligently and faithfully, to perform all duties to
the best of Employee's ability, and to devote Employee's full time and best
efforts to the conduct of Employer's business.
3. COMPENSATION. In consideration for the services of
Employee rendered to Employer pursuant to the terms of this Agreement, and
subject to the full performance of Employee's obligations hereunder, Employer
shall pay Employee according to the provisions of the Employer's compensation
plan described in Exhibit A hereto. Employee shall receive no compensation or
benefits, including but not limited to paid holidays, paid vacation and paid
health insurance, that is not set forth in Exhibit A hereto. Employee
understands that the compensation plan is subject to modification by the
Employer at any time.
4. TERM OF EMPLOYMENT. Employee's term of employment
under this Agreement shall commence on the 11th day of October, 1999, and
shall continue thereafter until the 11th day of October 2002, unless prior
thereto (a) within ninety (90) days from the effective date hereof either
Employer or Employee terminates this Agreement with or without cause and for
any reason whatsoever, (b) Employer, for good cause, terminates Employer's
employment of Employee, or (c) Employer and Employee mutually agree to the
termination of Employee's employment, in a writing signed by both of them.
5. CONFIDENTIAL INFORMATION.
A. DEFINITION OF CONFIDENTIAL INFORMATION.
Employer is in the business of designing, creating, perfecting, marketing,
distributing, selling and servicing computer software, and has built up an
established and extensive trade and reputation in the industry. Employer has
developed and continues to develop commercially valuable technical and
non-technical information ("Confidential Information") that is proprietary
and confidential and/or constitutes Employer's "trade secrets" within the
meaning of the Idaho Trade Secrets Act, Idaho Code Sections 48-801 -- 48-807.
Such Confidential Information, which is vital to the success of Employer's
business, includes, but is not necessarily limited to: programs, computer
programs, system documentation, data compilations, manuals, methods,
techniques, processes, patented and/or unpatented technology, research,
know-how, development, designs, devices, inventions, the identities of
customers, prospective customers, suppliers and prospective suppliers,
contracts with suppliers and customers, sales proposals, methods of sales,
marketing research and data, pricing policies, cost information, financial
information, business plans, specialized requests of Employer's customers,
and other materials and documents developed by Employer. Confidential
Information also includes special hardware, product hardware, related
software and related documentation, either owned by Employer
or in Employer's possession under an agreement of nondisclosure. Through
Employee's employment, Employee may become acquainted with or contribute to
the Employer's Confidential Information through inventions, discoveries,
improvements, software development, and/or in other ways.
B. EMPLOYEE ACCESS TO CONFIDENTIAL
INFORMATION. Employee agrees: (a) to access only such Confidential
Information as is necessary to perform Employee's job function; (b) to allow
access to Confidential Information under Employee's control to only those of
Employee's co-employees whose job functions for Employer necessitate access
to such Confidential Information; and (c) to allow such co-employees to
access only such Confidential Information under Employee's control as is
necessary to the co-employee's performance of his/her job functions for
Employer.
C. NONDISCLOSURE OF CONFIDENTIAL INFORMATION.
Employee shall not, at any time, either during or subsequent to employment,
directly or indirectly, appropriate, disclose or divulge any Confidential
Information to any person not then employed by Employer, unless authorized or
directed by Employer. If Employer authorizes or directs Employee to disclose
Confidential Information to any such third party, Employee must ensure that a
signed confidentiality agreement is or has been obtained from the third party
to whom Confidential Information is being disclosed and that all Confidential
Information so disclosed is clearly marked "Confidential."
D. RETURN OF CONFIDENTIAL AND OTHER
INFORMATION. All Confidential Information provided to Employee, and all
documents and things prepared by Employee in the course of Employee's
employment, including but not necessarily limited to correspondence,
drawings, blueprints, manuals, letters, notes, lists, notebooks, reports,
flow-charts, computer programs, proposals, DayTimers, planners, calendars,
schedules, discs, data tapes, financial plans and information, business
plans, and other documents and records, whether in hard copy, magnetic media
or otherwise, and any and all copies thereof, are the exclusive property of
Employer and shall be returned immediately to Employer upon termination of
employment or upon Employer's request at any time.
E. OWNERSHIP OF CONFIDENTIAL INFORMATION.
Employee hereby grants to Employer, and Employer hereby accepts, the entire
right, title, and interest of Employee in and to any of the Confidential
Information created or developed by Employee, or that may be created or
developed by Employee during the term of the employment under this Agreement,
including, but not limited to, all patents, copyrights, trade secrets, and
other proprietary rights in or based on the Confidential Information. If the
Confidential Information or any portion thereof is copyrightable, it shall be
deemed to be a "work made for hire," as such term is defined in the copyright
laws of the United States. Employee shall cooperate with Employer or its
designees and execute assignments, oaths, declarations, and other documents
prepared by Employer, to effect the foregoing or to perfect or enforce any
proprietary rights resulting from or related to this agreement. Such
cooperation and execution shall be at no additional compensation to Employee;
provided, however, Employer shall reimburse Employee for reasonable
out-of-pocket expenses incurred at the specific request of Employer.
6. NONCOMPETITION OBLIGATIONS. Employee will not
during the term of his/her employment with Employer, and for a period of
eighteen (18) months immediately following termination of such employment for
any reason, Employee will not offer for sale, or solicit the sale of products
or services similar to those sold by Employer, in or within the geographic
area in which Employee was assigned and/or worked for Employer, either for
him/herself or on behalf of any other person, firm, partnership, or
corporation.
7. CUSTOMER NON-SOLICITATION. Employee will not,
during the term of employment hereunder and for eighteen (18) months
following termination of such employment for any reason, solicit, divert,
take away, or attempt to solicit, divert or take away, any of Employer's
customers or the business or patronage of any such customers, either for
him/herself or on behalf of any other person, firm, partnership or
corporation.
8. CO-EMPLOYEE NON-SOLICITATION. Employee will not,
during the term of employment hereunder and for eighteen (18) months
following termination of such employment for any reason, solicit, recruit or
hire any other employee of Employer, either for him/herself or on behalf of
any other person, firm, partnership or corporation.
9. ENFORCEMENT.
A. REASONABLENESS OF RESTRICTIONS. Employee
acknowledges that compliance with this Agreement is reasonable and necessary
to protect Employer's legitimate business interests, including but not
limited to the Employer's goodwill.
B. IRREPARABLE HARM. Employee acknowledges
that a breach of Employee's obligations under this Agreement will result in
great, irreparable and continuing harm and damage to Employer for which there
is no adequate remedy at law.
C. INJUNCTIVE RELIEF. Employee agrees that in
the event Employee breaches this Agreement, Employer shall be entitled to
seek, from any court of competent jurisdiction, preliminary and permanent
injunctive relief to enforce the terms of this Agreement, in addition to any
and all monetary damages allowed by law, against Employee.
D. EXTENSION OF COVENANTS. In the event
Employee violates any one or more of the covenants contained in sections 6
through 8 of this Agreement, Employee agrees that the running of the term of
each such covenant so violated shall be tolled during (a) the period(s) of
any such violation by Employee and (b) the pendency of any litigation
(including appeals) concerning any such violation by Employee.
E. JUDICIAL MODIFICATION. The parties have
attempted to limit the Employee's right to compete only to the extent
necessary to protect Employer from unfair business practices and/or unfair
competition. The parties recognize, however, that reasonable people may
differ in making such a determination. Consequently, the parties hereby agree
that, if the scope or enforceability of the restrictive covenant is in any
way disputed at any time, a court or other trier of fact may modify and
enforce the covenant to the extent that it believes to be reasonable under
the circumstances existing at that time.
F. ATTORNEY FEES. In the event it becomes
necessary for Employer to institute a suit at law or in equity for the
purposes of enforcing any of the provisions of this Agreement, Employer shall
be entitled to recover Employer's reasonable attorney's fees, plus court
costs and expenses, from Employee.
G. WITHHOLDING FROM FINAL PAYCHECK. Employee
expressly authorizes Employer to withhold and deduct from Employee's final
wages any amounts owed by Employee to Employer at the time of the termination
of employment, including but not limited to, any draw deficiencies,
reimbursement for unearned commissions, and the value of unreturned or
damaged company property. Employee further expressly agrees to repay to
Employer any additional sums owed by Employee to Employer (above that which
can be withheld) immediately upon termination of Employee's employment.
Employee agrees that this paragraph waives and supersedes any and all
federal, state and/or local laws to the contrary.
10. INDEMNITY. Employee warrants and represents that
he/she has not violated, is not violating, and will not violate any of the
terms or conditions of any prior employment agreement, restrictive covenant,
or other agreement entered into by him/her while in the employment of any
other employer; that he/she has not given and will not give to Employer at
any time any customer list, trade secret, or any other item of confidential
information, obtained or received while in the employment of such other
employer; that his/her employment with Employer is not restricted or limited
in any way by any such employment agreement or restrictive covenant or by
operation of any state, federal or local regulation, statute or other law of
any kind, name or nature, including but not limited to trade secret laws and
immigration laws; and that Employee is in all respects duly qualified and
eligible to work for Employer. In the event any legal or administrative
action is commenced against the Employee, Employer or both, arising out of
Employee's former employment by another employer or Employee's illegal action
or violation of one or more of the warranties and representations set forth
in this section, Employee agrees to indemnify Employer for all damages, costs
and expenses, including reasonable attorney fees, which Employer may have to
pay in connection with such legal or administrative action.
11. MISCELLANEOUS.
A. SURVIVAL. Employee understands that this
Agreement shall be effective when signed and that the terms of this Agreement
shall remain in full force and effect not only during the continuation of
his/her employment, but also after the termination of employment for any
reason by Employer or Employee.
B. WAIVER. Failure of the Employer to
exercise or otherwise act with respect to any of its rights under this
Agreement shall not be construed as a waiver of such breach, nor prevent the
Employer from thereafter enforcing strict compliance with any and all terms
of this Agreement.
C. SEVERABILITY. If any part of this Agreement
shall be adjudicated to be invalid or unenforceable, as to duration,
territory or otherwise, then such part shall be deemed deleted from the
Agreement or amended, as the case may be, in order to render the remainder of
the Agreement valid and enforceable.
D. AGREEMENT BINDING. This Agreement shall be
binding upon and inure to the benefit of Employer, Employer's successors and
assigns, Employee and Employee's heirs, executors, administrators and legal
representatives.
E. GOVERNING LAW. This Agreement is made and
entered into in the State of Idaho and concerns employment situated in said
state. This Agreement shall be interpreted and construed in accordance with
the laws of the State of Idaho.
F. TITLES AND CAPTIONS. All section and
paragraph titles and captions contained in this Agreement are for convenience
only and shall not be deemed part of the context nor affect the construction
or interpretation of this Agreement.
G. ENTIRE AGREEMENT. This Agreement contains
all the understandings and agreements between the parties concerning matters
set forth in this Agreement. The terms of this Agreement supersede any and
all prior statements, representations and agreements by or between Employer
and Employee, or either of them, concerning the matters set forth in this
Agreement. Employee acknowledges that no person who is an agent or employee
of Employer may orally or by conduct modify, delete, vary, or contradict the
terms or conditions of this Agreement or this paragraph. This Agreement may
be modified only by a written agreement signed by both parties.
IN WITNESS WHEREOF, the parties have set their hands as of the
date first above written, and Employee acknowledges that he/she has read and
understands the entire contents of this Agreement and that he/she has received a
copy of this Agreement.
EMPLOYER: XXXXXXXXXX.XXX, INC.
By: ______________________________ DATE: __________________________
Title: ___________________________
EMPLOYEE: ________________________ DATE: __________________________
Xxxxx Xxxxxx
EXHIBIT A TO EMPLOYMENT AGREEMENT
EFFECTIVE OCTOBER 11TH, 1999
Employee's Job Title: Chief Financial Officer and Treasurer of Xxxxxxxxxx.xxx, Inc.
Base Salary: $112,500 annually for the term of this Agreement, payable at the same
frequency as Employer's other employees.
In the event Xxxxxxxxxx.xxx is acquired and you are released for other than
cause, your salary will continue for 6 months.
Stock Option: Employer shall grant to Employee an option to acquire up to 40,000 shares of
Employer's common stock pursuant to and subject to the terms of the
Non-qualified Stock Option and Restricted Stock Plan. The options shall be
exercisable at the option price of $6.00 per share. The options shall be
subject to lock-ups and restrictions required by the IPO underwriter. The
options shall vest as follows:
CONTINUOUS EMPLOYMENT
FROM SIGNING AGREEMENT PORTION EXERCISABLE
October 11, 2000 1/3
October 11, 2001 1/3
October 11, 2002 1/3
In the event Xxxxxxxxxx.xxx is acquired, your stock options will vest
immediately.
Benefits: Employee shall participate in employee benefit programs, such as paid
vacation, life insurance, medical, disability and other similar plans
that now or during the term of this Agreement are made generally
available to executives of Employer of comparable position. Employer
will pay for Medical and Dental Insurance premiums for employee, spouse
and children.
Expenses: Employer will reimburse Employee for reasonable expenses for entertainment,
travel, phone, day-to-day expenses and similar items that he incurs on behalf
of Employer.
EMPLOYER: XXXXXXXXXX.XXX, INC.
By: ______________________________ DATE: _____________________________
Title: ___________________________
EMPLOYEE: ________________________ DATE: ______________________________
Xxxxx Xxxxxx
