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EXHIBIT 10.17
EMPLOYMENT AGREEMENT
(Alternate 1 - 3 years)
This Employment Agreement ("Agreement") is made as of __________,
1998, by and between SOFTWARE INNOVATORS, INC., a Texas corporation, located at
0000 X. Xxxxxxxxxx, Xxxxx 000, Xxxxxx Xxxx, Xxxxxxxx 00000 (the "Company"), and
XXXX X. XXXXX, an individual with an address of 0000 X. Xxxxxxxxxx, Xxxxx 000,
Xxxxxx Xxxx, Xxxxxxxx 00000 (the "Employee").
1. Employment. The Company hereby agrees to employ the Employee and
the Employee hereby agrees to work for the Company under the terms and
conditions set forth herein. This Agreement supersedes and replaces any prior
employment agreement or other agreement between the parties dealing with the
subject matter hereof and such prior agreements, if any, are hereby terminated.
2. Term of Employment. The term of employment pursuant to this
Agreement shall begin on the date set forth above (the "Effective Date") and
shall continue in effect for an initial term of three (3) years from the date
set forth above unless terminated in accordance with Section 7, and shall be
extended from year to year thereafter, unless terminated effective as of the
end of the initial term or any one-year extension thereafter by written notice
from the Company to Employee, or by written notice of Employee to the Company,
delivered not less than sixty (60) days prior to the end of the initial term,
or the end of such one-year extension, as applicable.
3. Scope of Duties; Covenants.
(a) The Employee shall be employed by the Company in the
position set forth on Schedule A hereto and shall perform the duties as set
forth on Schedule A hereto. At all times, Employee shall serve under the
direction of the Board of Directors and the Chief Executive Officer of the
Company and shall perform such services and exercise such authority as is
customary for such position.
(b) So long as he is employed by the Company, Employee shall
devote his skill, energy and best efforts to the faithful discharge of his
duties as an employee of the Company. The Employee agrees that in the provision
of all services to the Company, he will comply with and follow the provisions
of this Agreement and all directives, policies, standards and regulations from
time to time established by the Board of Directors of the Company.
(c) Employee represents and warrants that Employee is under
no contractual or other restrictions or obligations which will significantly
limit the performance of Employee's obligations under this Agreement or which
will prohibit or limit the use by the Employee of any information which relates
to the business of the Company or the services to be rendered by the Employee
under this Agreement (including, without limitation, any agreement relating to
any
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proprietary information, knowledge or data acquired by Employee in confidence,
trust or under other obligation prior to Employee's employment by the Company).
Employee covenants and agrees that Employee shall not disclose to the Company,
or induce the Company to use, any such proprietary information, knowledge or
data belonging to any previous employer or others. Employee further covenants
and agrees not to enter into any agreement or understanding, either written or
oral, in conflict with the provisions of this Agreement during the term of this
Agreement.
(d) To the extent they relate to, or result from, directly or
indirectly, the actual or anticipated operations of the Company, the Employee
hereby agrees that all Intellectual Property (defined below) developed,
purchased or acquired by the Company, shall be the exclusive property of the
Company, and unless otherwise agreed by the Company, all right, title and
interest therein shall remain in the Company.
(e) The Employee will hold all Intellectual Property and
Confidential Information (defined below) in trust for the Company and will
deliver all Intellectual Property and Confidential Information in his
possession or control to the Company upon request and, in any event, at the end
of his employment with the Company. During the term of his employment with the
Company, the Employee will promptly disclose to the Company all Confidential
Information that comes to Employee's attention which has not previously been
disclosed to the Company, as well as any business opportunity reasonably
related to the scope of business of the Company or an Assisted Affiliate as
described in Section 8, which comes to his attention. The Employee will not
take advantage of or divert from the Company any such business opportunity for
the benefit of himself or any other party without the prior written consent of
the Company.
4. Compensation.
(a) During the first year of the term of employment
hereunder, the Company shall pay the Employee a base salary, payable in equal
periodic installments in accordance with the Company's customary payroll
practices, not less frequently than semi-monthly, at an annual rate or rates
set forth on Schedule A attached hereto and incorporated by reference herein.
Schedule A may also set forth certain other compensation payable to Employee.
In each subsequent year of the term of employment, the Company shall pay to the
Employee a salary and any such other compensation determined by the Board of
Directors following its annual salary and performance review; provided,
however, that such salary and compensation shall not be less than the amount
determined in accordance with Schedule A.
(b) Employee shall receive an annual cash performance bonus
for each calendar year during the term of this Agreement to be determined
according to the following procedure except as may be otherwise mutually agreed
to between the Employee and the Company. The Board of Directors of the Company,
or the Compensation Committee of the Board of Directors, if so authorized,
shall establish specific annual performance goals for the Company and for
Employee with respect to each calendar year (or portion thereof) during the
term of this Agreement commencing on January 1, 1998. Such goals shall be
communicated to Employee not later than the end of the first quarter of the
applicable calendar year. At the end of each calendar year during the term of
this Agreement, or within a reasonable time thereafter, the Board of Directors
of the Company, or the
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Compensation Committee of the Board of Directors, if so authorized, shall
review the actual performance of the Company and Employee, giving due
consideration to market and other developments outside of the control or
influence of Employee and the Company, and based upon the extent to which the
applicable annual performance goals have been achieved, shall determine in its
sole and absolute discretion, the amount of performance bonus payable to
Employee with respect to such year.
(c) The Company shall also pay Employee a monthly automobile
allowance in the amount set forth on Schedule A attached hereto.
(d) All payments of salary and other compensation to the
Employee shall be made after deduction of any taxes which are required to be
withheld with respect thereto under applicable federal and state laws.
5. Vacation/Personal Time. Employee shall be entitled to leave for
vacation and personal time off as provided on Schedule A attached hereto and
incorporated by reference herein. Unused holidays and days for personal time
off and vacation may not be carried over from one fiscal year to another. The
aggregate number of days specified on Schedule A for vacation and personal time
off need not be taken by Employee in succession, but in any increments and at
any time during the year as approved by the Company. For purposes of this
Agreement, "personal time off" shall include time taken off by Employee on
account of illness, family emergency or death in the immediate family.
6. Fringe Benefits; Expenses. So long as the Employee is employed by
the Company, the Employee shall participate in any employee benefit plans
sponsored by the Company generally for its employees serving in similar
employment capacities as the Employee as determined from time to time by the
board of directors of the Company or any compensation committee of the board of
directors, if any, and on terms at least as favorable to Employee as are
generally offered to other employees of the Company serving in a similar
capacity. The Company shall also reimburse Employee for his reasonable travel
and other out-of-pocket business expenses incurred in connection with his
employment under this Agreement pursuant to expense reports filed in accordance
with the Company's policies in effect from time to time, provided that if
Employee receives an automobile allowance pursuant hereto, then Employee shall
not otherwise be reimbursed for automobile expenses under this provision,
except for out-of-town rental automobiles.
7. Termination.
(a) General. Employer and Employee agree that Employee's
employment hereunder may be terminated by the Employee resigning or by the
Company's declaration of termination with or without "Cause" at any time,
subject to the terms of this Section 7. Such termination shall be effective
upon delivery of written notice from the acting party to the other of its
election to terminate employment pursuant to this Section 7. "Cause" when used
in connection with the termination of employment with the Company, shall mean
the termination of the Employee's employment by the Company by reason of (i)
Employee's material breach of any of Sections 3, 7, 8, 9, 10, 11 and 12 of this
Agreement which breach, if curable, is not cured within thirty (30) days of
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written notice to Employee of such breach; (ii) the conviction of, or the
entering of a guilty plea or no contest plea by, the Employee for a crime
involving moral turpitude by a court of competent jurisdiction; (iii) the
commission by the Employee of an act of fraud upon the Company or any of its
affiliates; (iv) the misappropriation of any funds or property of the Company
or any of its affiliates by the Employee; (v) the failure by the Employee to
perform material duties assigned to him pursuant to Schedule A or otherwise
assigned to and accepted by Employee, or to comply with any written Company
policy after reasonable written notice and opportunity to cure such
performance; (vi) the engagement by the Employee in any direct, material
conflict of interest with the Company or any of its Assisted Affiliates without
compliance with the Company's conflict of interest policy, if any, then in
effect; or (vii) the engagement in any activity which would constitute a
material violation of the provisions of the BrightStar Information Technology
Group, Inc. ("BrightStar") xxxxxxx xxxxxxx policy, if any, then in effect.
(b) Termination for Cause or Resignation. If the Company
terminates the Employee's employment for Cause or the Employee voluntarily
resigns, the Company shall pay the Employee's base salary earned through the
date of termination (and any other earned but unpaid compensation and accrued
vacation time prior to termination), but all rights to any other compensation
or benefits arising hereunder, shall be canceled and terminated in all respects
concurrently with such termination of employment; provided that the Employee
may elect to continue to participate, at Employee's own expense, in such health
insurance and other benefits as to which the opportunity for continuing
participation is mandated by applicable laws.
(c) Termination Without Cause. In the event that the
Employee's employment is terminated by the Company without Cause other than at
the end of the initial term or one of the one year renewal terms of this
Agreement, the Company shall, subject to the terms of subsections 7.(e) and
7.(f) below, and only if and as long as Employee is not in breach of his
obligations under this Agreement, pay compensation to Employee in the manner
set forth below. Employee may not be terminated without Cause unless such
termination has been approved in writing by BrightStar. If the Employee is
terminated without Cause during the initial three-year term of this Agreement,
then the Company shall continue to pay to Employee his current base salary
provided for under this Agreement, plus any other earned and unpaid
compensation and accrued vacation time prior to termination, plus a per annum
amount of additional compensation based on prior earned bonuses and/or
commissions, if any, equal to the amount of earned bonuses or commissions of
Employee during the twelve complete calendar months immediately preceding the
date of termination ("Severance Payments"), in periodic payments in accordance
with its customary payroll practices for the period ending the later of (i) the
end of the initial three-year term of the Agreement or (ii) twelve months after
termination of employment. If the Employee is terminated without Cause during
any one-year extension of the initial term of the Agreement, then the Company
shall continue to pay to Employee Severance Payments in accordance with its
customary payroll practices for a period of twelve months after termination of
such employment. If the Employee is terminated by the Company without Cause,
the Company shall also continue to provide benefits in the kind and amounts
provided to its employees generally for up to twelve months following the date
of termination, including continuation of any Company-paid benefits provided
pursuant hereto, for the Employee and Employee's spouse and minor children,
provided such benefits will be subject to immediate termination to the extent
Employee receives benefits under another similar benefit plan. If the
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Company fails to make any of the payments required under this Section 7.(c)
when reasonably due, then any restrictions imposed by Section 8 hereof against
Employee competing with the Company shall immediately lapse, but this shall not
release the Company's obligation for Severance Payments. Employee agrees that
the above payments shall be a full settlement of the Company's obligations to
Employee hereunder in the event of a termination without Cause.
(d) Termination Following Change of Control. In the event of
(i) the sale of all or substantially all of the assets of the Company, or (ii)
a merger, consolidation, liquidation or reorganization of the Company, in which
the Company or an affiliate of the Company is not the surviving entity, or
which results, in any event, in a change of control of the Company (each, a
"Change in Control Transaction"), the Company or the surviving entity, as the
case may be, may either (A) terminate Employee's employment hereunder and pay
to the Employee an amount equal to thirty-six months (36) compensation at
Employee's then current annual salary, payable not less frequently than
monthly, and continue to provide benefits in the kind and amounts provided to
its employees generally for such thirty-six (36) month period (collectively,
"Change of Control Compensation") or (B) adopt this Agreement; provided,
however, that if the Company or the surviving entity elects to adopt this
Agreement following a Change in Control Transaction and it shall subsequently
terminate Employee's term of employment without Cause, then it shall pay and
provide to Employee salary and benefits equal to the greater of (x) the salary
and benefits to be provided under Section 7.(c), and (y) the difference between
the salary and benefits provided to Employee pursuant to clause (A) above and
the aggregate amount of salary and benefits actually paid to Employee following
the Change in Control Transaction.
(e) Disability; Death. If at any time during the term of this
Agreement, Employee is unable, due to physical or mental disability, to perform
effectively his duties hereunder, the Company shall continue payment of
compensation as provided in Section 4 during the first six months of such
disability to the extent not covered by the Company's disability insurance
policies. Upon the expiration of such six month period, the Company, at its
sole option, may continue payment of Employee's salary for such additional
periods as the Company elects, or may terminate this Agreement without any
further obligations hereunder. If Employee should die during the term of this
Agreement, Employee's employment and the Company's obligations hereunder shall
terminate as of the end of the month in which Employee's death occurs and there
will be no salary and benefit continuation period. Employee shall be deemed to
have incurred a disability if Employee suffers a physical or mental condition
which (i) satisfies the definition of "total disability" in the Company's
disability insurance policies, or (ii) if no such policy or plan is then
covering Employee, in the reasonable judgment of the Board of Directors,
prevents Employee from engaging in any substantial gainful employment with the
Company for a period of more than six (6) months.
(f) Standstill Agreement; Lock-up Letters. So long as
Employee is employed by the Company or receives severance compensation as
provided above, Employee agrees that he will sign any reasonable securities
lock-up letters, standstill agreements, or other similar documentation required
by an underwriter in connection with a public offering of securities by
BrightStar or take other actions reasonably related thereto as requested by the
Board of Directors of the Company under similar terms and conditions as for
other management employees of the Company or BrightStar generally. Failure to
take any such action shall be a "Cause" for termination and shall cause
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Employee to forfeit any further rights to compensation or other payments
hereunder. In addition, Employee agrees that in such event the Company can seek
and obtain specific performance of such covenant, including any injunction
requiring execution thereof, and the Employee hereby appoints the then current
president of the Company to sign any such documents on his behalf so long as
such documents are prepared on the same basis as for other management
shareholders generally.
(g) Relocation or Material Change in Duties. If Employee's
employment is terminated because of Employee's refusal to relocate to another
office of the Company or to accept a material change in duties, such
termination shall not be deemed a termination for Cause or a termination
without Cause. In the event of such a termination, the Company shall continue
to pay to Employee his current base salary plus any other earned and unpaid
compensation and accrued vacation time prior to termination, plus a per annum
amount of additional compensation based on prior earned bonuses and/or
commissions, if any, equal to the amount of earned bonuses or commission of
Employee during the twelve complete calendar months immediately preceding the
date of termination, in customary periodic payments for twelve (12) months
after such termination; and the Company shall continue to provide benefits to
Employee the same as are available to its employees generally for up to twelve
(12) months after termination, provided that such benefits will be terminated
to the extent Employee receives benefits under another similar benefit plan.
8. Covenant Not to Compete.
(a) During Term of Employment. During Employee's term of
employment pursuant to this Agreement, Employee will not compete with the
Company or its affiliates, directly or indirectly, either for himself or as a
member of a partnership or a limited liability company or as a stockholder
(except as a stockholder of less than one percent (1 %) of the issued and
outstanding stock of a publicly-held company whose gross revenues exceed $100
million), investor, owner, officer or director of a company or other entity, or
as an employee, agent, trustee, manager, associate or consultant of any person,
partnership, corporation or other entity, in any business in competition with
that carried on by the Company or any of its affiliates. As of the date hereof,
the Company anticipates that it will engage principally in the business of
providing information technology services to a variety of industries, but the
provisions of this Section 8.(a) shall apply to any business in which the
Company or its affiliates are engaged during the term of Employee's employment.
(b) Restricted Periods. Section 8.(c) below restricts
Employee's ability to compete against the Company or it affiliates following
Employee's term of employment. For purposes of this Section 8, and in
particular Section 8.(c), if Employee voluntarily resigns his employment with
the Company, or is terminated by the Company for Cause, then the period for
which Employee cannot compete with the Company shall be the longer of (i) four
(4) years from the date hereof, or (ii) one (1) year after the termination of
employment ("Restricted Period For Cause"). If Employee is terminated by
Employer without Cause or pursuant to Section 7(d) above, then the period for
which Employee cannot compete with the Company or its affiliates (the
"Restricted Period Without Cause"), shall be based upon whether Employee was
terminated during the initial three-year term or during any extension thereof.
If Employee was terminated without Cause during the initial three-year term,
the Restricted Period Without Cause shall be the greater of (i) the remaining
months left of the initial three-year term, or (ii) until one (1) year after
the termination of employment without Cause. If
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Employee was terminated during any one (1) year extension of the initial
three-year term, the Restricted Period Without Cause shall be equal to one (1)
year after the termination of employment without Cause. If Employee is
terminated under the circumstances in Section 7(g) above, then the period for
which the Employee may not compete pursuant hereto shall be for one year after
the date of termination. If Employee is also a party to that certain Agreement
and Plan of Exchange dated December 18, 1997 among BrightStar Information
Technology Group, Inc. and the Shareholders of the Company (or its predecessor)
at that time and bound by certain non-competition provisions contained therein,
then any restricted non-compete periods under such agreement are hereby
modified so as to conform with the restricted periods contained in this Section
8.(b).
(c) Following Term of Employment. Employee further agrees
that, during the Restricted Period For Cause or the Restricted Period Without
Cause or the restricted period if termination occurs under the circumstances in
Section 7(g), as applicable, Employee will not represent, engage in or carry
on, directly or indirectly, any business with any customer or client of the
Company (or any customer or client of an affiliate of the Company for which the
Employee has materially assisted such affiliate in serving such customer or
client ("Assisted Affiliate")) at the time of termination of employment, or any
business within 100 miles of the city or county limits of any city or county in
the United States or foreign countries where the Company or any Assisted
Affiliate has an office or in which the Company provides services which produce
Company revenues of an amount equal to 2% or more of the Company's revenues for
the twelve complete calendar months preceding the time of termination, which
business competes with any business, services or products produced, sold,
conducted, developed, or in the process of development by the Company or
jointly by the Company and an Assisted Affiliate during the term of Employee's
employment, including any business that involves the furnishing of information
technology services that are the type of services furnished by the Company,
either for himself, as a member or equity owner of a partnership or a limited
liability company, or as a shareholder (other than as a shareholder of less
than one percent (1%) of the issued and outstanding stock of a publicly-held
company whose gross revenues exceed $100 million), investor, owner, officer or
director of a company or other entity, or as an employee, agent, trustee,
manager, associate or consultant of any person, partnership, corporation or
other entity. As of the date hereof, the Company anticipates that it will
engage principally in the business of providing information technology services
to a variety of industries, but the provisions of this Section 8.(c) shall
apply to any business in which the Company is engaged at the termination of
Employee's employment.
(d) Employee Agrees to Limitations. Employee agrees that the
limitations set forth herein on his rights to compete with the Company and its
affiliates are reasonable and necessary for the protection of the Company and
its affiliates. In this regard, Employee specifically agrees that the
limitations as to period of time and geographic area, as well as all other
restrictions on his activities specified herein, are reasonable and necessary
for the protection of the Company and its affiliates. In particular, Employee
acknowledges that the parties anticipate that the Employee will be actively
seeking markets for the Company's products throughout the United States and in
other countries of the world during Employee's employment with the Company. In
the event that the provisions of this Agreement should ever be legally held to
exceed the scope of business, time or geographic limitations permitted by
applicable law, such provisions shall be and are hereby reformed to the maximum
scope of business, time or geographic limitations permitted by applicable law.
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(e) Affiliates. For purposes of this Agreement, an
"affiliate" of the Company is any person or entity that directly, or indirectly
through one or more intermediaries, controls, or is controlled by, or is under
common control with, the Company.
(f) Specific Performance. Employee agrees that the remedy at
law for any breach by him of this Section 8 will be inadequate and that the
Company shall also be entitled to injunctive relief.
9. Confidential Information and Results of Services.
(a) Treatment of Confidential Information. Employee agrees
that during the term of this Agreement, and for five (5) years after his
termination of employment, he will not use or disclose, without the prior
consent of the Company, the Confidential Information (as hereinafter defined)
owned by or subject contractually to be safeguarded by the Company, or any of
its affiliates, and further agrees, that he will return to the Company all
written, printed, or other physical presentation or holding of materials in his
possession embodying such Confidential Information. Employee acknowledges that
any information and materials received by the Company from third parties in
confidence (or subject to non-disclosure or similar covenants) shall be deemed
to be and shall be Confidential Information within the meaning of this Section
9. As a material inducement to the Company to employ (or to continue to employ)
Employee and to pay to Employee compensation for such services to be rendered
to the Company by Employee (it being understood and agreed by the parties
hereto that such compensation shall also be paid and received in consideration
hereof), Employee covenants and agrees that Employee shall not, except with the
prior written consent of the Company, or unless Employee is acting as an
employee of the Company solely for the benefit of the Company in connection
with the Company's business and in accordance with the Company's business
practices and employee policies, at any time during or following the term of
Employee's employment by the Company, directly or indirectly, disclose,
divulge, reveal, report, publish, transfer or use, for any purpose whatsoever,
any of such information which has been obtained by or disclosed to Employee as
a result of Employee's employment by the Company.
(b) Definition of Confidential Information. For purposes of
this Agreement, "Confidential Information" includes information conveyed or
assigned to the Company by Employee or conceived, compiled, created, developed,
discovered or obtained by Employee from and during his employment relationship
with the Company, whether solely by the Employee or jointly with others, which
concerns the affairs of the Company or its affiliates and which the Company
could reasonably be expected to desire be held in confidence, or the disclosure
of which would likely be materially embarrassing, detrimental or
disadvantageous to the Company or its affiliates and without limiting the
generality of the foregoing includes information relating to inventions, and
the trade secrets, technologies, algorithms, products, services, systems,
programs (including, without limitation, the Company's computer software
programs), procedures, manuals, confidential reports and communications,
finances, business plans, marketing plans, legal affairs, supplier lists,
client lists, potential clients, business prospects, business opportunities,
personnel assignments, contracts and assets of the Company and information made
available to the Company by other parties under a confidential relationship.
Confidential Information, however, shall not include information (i) which is,
at the time in question, in the public domain through no wrongful act of
Employee, (ii) which is
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later disclosed to Employee by one not under obligations of confidentiality to
the Company or Employee, (iii) which the Company has expressly given Employee
the right to disclose pursuant to written agreement, or (iv) which is required
by court or governmental order, law or regulation to be disclosed; provided,
that Employee shall first have given prompt notice to the Company of any such
possible or prospective order (or proceeding pursuant to which any such order
may result) such that the Company shall have been afforded a reasonable
opportunity to prevent or limit any such disclosure. Employee agrees that the
remedy at law for any breach by him of this Section 9 will be inadequate and
that the Company shall also be entitled to injunctive relief.
10. Definition of Intellectual Property.
(a) For purposes of this Agreement, the term "Intellectual
Property" shall mean all of the information referred to in Section 9 hereof and
all of the following materials and information (whether or not reduced to
writing and whether or not patentable or protectible by copyright) which
Employee receives, receives access to, conceives or develops or has received,
received access to, conceived or developed, in whole or in part, directly or
indirectly, in connection with Employee's employment with the Company and any
assistance to affiliates of the Company and related to the Company's and its
affiliates scope of business (in any capacity, whether executive, managerial,
planning, technical, sales, research, development, manufacturing, engineering
or otherwise) or through the use of any of the Company's facilities or
resources:
(b) Discoveries, concepts, and ideas including, without
limitation, the nature and results of research and development activities,
processes, formulas, inventions, computer-related equipment or technology,
techniques, "know-how," designs, drawings and specifications;
(c) Production processes, marketing techniques and
arrangements, mailing lists, purchasing information, pricing policies, quoting
procedures, financial information, customer and prospect names and
requirements, employee, customer, supplier and distributor data and other
materials or information relating to the Company's business and activities and
the manner in which the Company does business;
(d) Applications, operating systems, data bases,
communications and other computer software, whether now or hereafter existing
and developed for use on any operating system, and all modifications,
enhancements and versions and all options available with respect thereto, and
all future products developed or derived therefrom;
(e) Source and object codes, flowcharts, algorithms, coding
sheets, routines, sub-routines, compilers, assemblers, design concepts and
related documentation and manuals;
(f) Any other materials or information related to the
business or activities of the Company which are not generally known to others
engaged in similar businesses or activities; and
(g) Patents, trademarks, copyrights, trade secrets, all
inventions, whether or not patentable, and any product, drawing, design,
recording, computer software program, writing, literary
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work or other author's work, in any other tangible form developed in whole or
in part by Employee during the term of this Agreement;
(h) All ideas, inventions, techniques, modifications,
processes, or improvements which are derived from or relate to Employee's
access to or knowledge of any of the above enumerated materials and
information, or which are created, conceived, developed, purchased or acquired
by Employee, either solely or in conjunction with others, during the term of
Employee's employment with the Company which relate to, or are useful in, the
business being conducted or proposed to be conducted by the Company or its
affiliates, and any such item created by the Employee, either solely or in
conjunction with others, following termination of the Employee's employment
with the Company, that is based upon or uses Intellectual Property.
(i) Failure to xxxx any of the Intellectual Property as
confidential, proprietary or Intellectual Property shall not affect its status
as part of the Intellectual Property under the terms of this Agreement.
(j) For purposes of this Agreement, the term "Intellectual
Property" shall not apply to any ideas, inventions, techniques, modifications,
processes, or improvements for which no equipment, supplies, facility or
Intellectual Property of the Company was used, which was developed entirely on
Employee's own time, and which does not (i) relate to the business of the
Company, (ii) relate to the Company's actual or demonstrably anticipated
research or development or (iii) result from any work performed by Employee for
the Company.
11. Ownership of Information.
(a) Employee covenants and agrees that all right, title and
interest in any Intellectual Property shall be and shall remain the exclusive
property of the Company. Employee agrees immediately to disclose to the Company
all Intellectual Property developed in whole or in part by Employee during the
term of Employee's employment with the Company and to assign to the Company any
right, title or interest Employee may have in such Intellectual Property.
Employee agrees to execute any instruments and to do all other things
reasonably requested by the Company (both during and after Employee's
employment with the Company) in order to vest more fully in the Company all
ownership rights in those items transferred by Employee to the Company;
(b) Employee will not contest the validity of any invention,
any copyright, any trademark or any mask work registration owned by or vesting
in the Company under this Agreement;
(c) Employee will execute, acknowledge, and deliver to the
Company such applications, assignments (including patent applications and
assignments), and other documents as the Company may request in order to apply
for and obtain patents or other registrations with respect to any Intellectual
Property in the United States and any foreign jurisdictions;
(d) Employee will sign all other papers necessary to carry
out the above obligations; and
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(e) Employee will give testimony and render any other
assistance but without expense to the Employee in support of the Company's
rights to any Intellectual Property.
(f) If any one or more of the foregoing items are protectible
by copyright and are deemed in any way to fall within the definition of "work
made for hire," as such term is defined in 17 U.S.C. ss. 101, such work shall
be considered a "work made for hire," the copyright of which shall be owned
solely, completely and exclusively by the Company. If any one or more of the
aforementioned items are protectible by copyright and are not considered to be
included in the categories of works covered by the "work made for hire"
definition contained in 17 U.S.C. ss. 101, such items shall be deemed to be
assigned and transferred completely and exclusively to the Company by virtue of
the execution of this Agreement.
12. Covenants Not to Hire Employees. It is recognized and understood
by the parties hereto that the employees of the Company are an integral part of
the Company's business and that it is extremely important for the Company to
use its maximum efforts to prevent the Company from losing employees. It is
therefore understood and agreed by the parties hereto that, because of the
nature of the business of the Company, it is necessary to afford fair
protection to the Company from the loss of any such employees. Consequently, as
a material inducement to the Company to employ (or continue to employ)
Employee, Employee covenants and agrees that, for the period commencing on the
date of Employee's termination of employment for any reason whatsoever and
ending two (2) years after Employee's termination of employment with the
Company, Employee shall not, directly or indirectly, hire or engage or attempt
to hire or engage any individual who shall have been an employee of the Company
at any time during the one (1) year period prior to the date of Employee's
termination of employment with the Company, whether for or on behalf of
Employee or for any entity in which Employee shall have a direct or indirect
interest (or any subsidiary or affiliate of any such entity), whether as a
proprietor, partner, co-venturer, financier, investor or stockholder, director,
officer, employer, employee, servant, agent, representative or otherwise. If
Employee violates this Section 12, Employee agrees that, as part of the damages
recoverable by the Company, Employee shall pay to the Company a liquidated
damages amount equal to the compensation of the employee of the Company
solicited away from employment with the Company by Employee for the twelve
months preceding the date of said employee's termination from the Company.
13. Injunctive Relief. Employee understands and agrees that the
Company shall suffer irreparable harm in the event that Employee breaches any
of Employee's obligations under this Agreement and that monetary damages shall
be inadequate to compensate the Company for such breach. Accordingly, Employee
agrees that, in the event of a breach or threatened breach by Employee of any
of the provisions of this Agreement, the Company, in addition to and not in
limitation of any other rights, remedies or damages available to the Company at
law or in equity, shall be entitled to a temporary restraining order,
preliminary injunction and permanent injunction in order to prevent or to
restrain any such breach by Employee, or by any or all of Employee's partners,
co-venturers, employers, employees, servants, agents, representatives and any
and all persons directly or indirectly acting for, on behalf of or with
Employee.
14. Materials. All notes, data, tapes, reference items, sketches,
drawings, memoranda, records and other materials in any way relating to any of
the Confidential Information or Intellectual
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Property or to the Company's business shall belong exclusively to the Company
and Employee agrees to turn over to the Company all copies of such materials in
Employee's possession or under Employee's control at the request of the Company
or, in the absence of such a request, upon the termination of Employee's
employment with the Company.
15. Remedies. Employee covenants and agrees that, if Employee shall
violate any of Employee's covenants or agreements under this Agreement, the
Company shall be entitled to an accounting and repayment from Employee of all
profits, compensation, royalties, commissions, remunerations or other payments
(collectively "Payments") which Employee realizes as a result of the violative
actions. Employee shall also reimburse the Company for all reasonable costs and
expenses (including reasonable attorneys fees) incurred in pursuing its rights
hereunder if Employee has violated this Agreement. Such remedy shall be in
addition to and not in limitation of any injunctive relief or other rights or
remedies to which the Company is or may be entitled at law or in equity or
otherwise under this Agreement, provided that recovery of any Payments shall be
reduced by the amount of any compensatory damages otherwise recovered.
16. Employee's Status. Except as expressly provided by terms of this
Agreement, nothing in this Agreement shall be construed as constituting a
commitment, guarantee, agreement or understanding of any kind or nature that
the Company shall continue to employ Employee, nor shall this Agreement affect
in any way the right of the Company to terminate the employment of Employee at
any time and for any reason whatsoever. No change of Employee's duties as an
employee of the Company shall result in, or be deemed to be, a modification of
the terms of this Agreement.
17. Notice. All notices, requests, demands and other communications
required by or permitted under this Agreement shall be in writing and shall be
sufficiently delivered if delivered by hand, by courier service, or sent by
registered or certified mail, postage prepaid, to the parties at their
respective addresses listed below:
(a) If to the Employee, to the address set out in the
beginning of this Agreement;
(b) If to the Company:
Software Innovators, Inc.
0000 X. Xxxxxxxxxx, Xxxxx 000
Xxxxxx Xxxx, Xxxxxxxx 00000
(c) With a copy to:
BrightStar Information Technology Group, Inc.
00000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Either party may change such party's address by such notice
to the other parties.
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18. Assignment. This Agreement is personal to the Employee, and he
shall not assign any of his rights or delegate any of his duties hereunder
without the prior written consent of the Company. Neither the employee nor his
spouse will have the right to commute, encumber, or otherwise dispose of any
prospective payments under this Agreement. The Company shall have the right to
assign this Agreement to a successor in interest in connection with a merger,
sale of substantially all assets, or the like; provided however, that an
assignment of this Agreement to an entity with operations, products or services
outside of the industries in which the Company is then active shall not be
deemed to expand the scope of Employee's covenant not to compete with such
operations, products or services without Employee's written consent.
19. Survival. The provisions of Sections 7 through 15 of this
Agreement shall survive the termination of the Employee's employment hereunder
in accordance with their terms, provided that all provisions of this Agreement
shall terminate five years after termination of employment (if not already
expired in accordance with their specific time of applicability) except with
respect to the resolution of any claims asserted prior to such termination.
20. Applicable Law. The substantive laws of the State of Arkansas,
excluding any law, rule or principle which might refer to the substantive law
of another jurisdiction, will govern the interpretation, validity and effect of
this Agreement without regard to the place of execution or the place for
performance thereof.
21. Binding Upon Successors. This Agreement shall be binding upon, and
shall inure to the benefit of, the parties hereto and their respective heirs,
legal representatives, successors and permitted assigns.
22. Entire Agreement. This Agreement constitutes the entire agreement
between the Company and the Employee with respect to the terms of employment of
the Employee by the Company and supersedes all prior agreements and
understandings, whether written or oral, between them concerning such terms of
employment.
23. Waiver and Amendments; Cumulative Rights and Remedies.
(a) This Agreement may be amended, modified or supplemented,
and any obligation hereunder may be waived, only by a written instrument
executed by the parties hereto. The waiver by either party of a breach of any
provision of this Agreement shall not operate as a waiver of any subsequent
breach.
(b) No failure on the part of any party to exercise, and no
delay in exercising, any right or remedy hereunder shall operate as a waiver
hereof, nor shall any single or partial exercise of any such right or remedy by
such party preclude any other or further exercise thereof or the exercise of
any other right or remedy. All rights and remedies hereunder are cumulative and
are in addition to all other rights and remedies provided by law, agreement or
otherwise.
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(c) The obligations of the parties hereto and such parties'
rights and remedies hereunder are in addition to all other obligations of such
parties, and all rights and remedies of such parties, created pursuant to any
other agreement.
24. Construction. Each party to this Agreement has had the opportunity
to review this Agreement with legal counsel. This Agreement shall not be
construed or interpreted against any party on the basis that such party drafted
or authored a particular provision, parts of or the entirety of this Agreement.
25. Severability. In the event that any provision or provisions of
this Agreement is held to be invalid, illegal or unenforceable by any court of
law or otherwise, the remaining provisions of this Agreement shall nevertheless
continue to be valid, legal and enforceable as though the invalid or
unenforceable parts had not been included therein. In addition, in such event
the parties hereto shall negotiate in good faith to modify this Agreement so as
to effect the original intent of the parties as closely as possible with
respect to those provisions which were held to be invalid, illegal or
unenforceable.
IN WITNESS WHEREOF, the Company and the Employee have executed this
Agreement under seal on the date first above written, to be effective as of
_______________, 1998.
COMPANY:
SOFTWARE INNOVATORS, INC.
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
EMPLOYEE:
------------------------------------
Xxxx X. Xxxxx
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SCHEDULE A TO EMPLOYMENT AGREEMENT
Xxxx X. Xxxxx
1. Duties: Chief Executive Officer and President
2. Salary Provisions: $150,000/yr
Bonus for 1998 in accordance with the bonus
arrangements currently in effect with the
Company consistent and customary with prior
Company practice.
3. Monthly automobile allowance: $1,000/month
4. Annual Number of Vacation Days: 15 days
5. Annual Number of Days for Personal Time Off: 5 days
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