EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement"), made and entered into as of January
1, 2000, by and between Nanopierce Technologies, Inc. (the "Corporation"), a
Nevada corporation, and Xxxxxx X. Xxxxxxxx, an individual with his principal
business address at 000 Xxxxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxx 00000
(the "Executive");
1. Employment and Term.
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(a) Employment. The Company hereby employs Executive and Executive hereby
accepts such employment, in the capacity of Chief Financial Officer of the
Corporation to act in accordance with the terms and conditions hereinafter set
forth.
(b) Term. Executive's employment hereunder shall be for an initial term
of one year (the "Initial Term") commencing on January 1, 2000 (the "Effective
Date") and terminating on December 31, 2000, subject to the extension or earlier
expiration of the Initial Term as provided in this Agreement. Within forty-five
(45) days of December 31, 2000 the Corporation's Board of Directors (the
"Board") shall review Executive's performance under this Agreement and, in its
sole discretion, renew the Agreement for a term of one year (a "Renewal Term")
commencing on the first day immediately following the Expiration Date (as
defined below). The board shall provide Executive written notice of its
decision to renew or not renew this Agreement at least 30 days prior to the date
of this Agreement expires under the Initial Term of any Renewal Term (the
"Expiration Date"). If the Board fails to provide Executive with such written
notice, within the time period set forth above, the Agreement shall terminate on
the Expiration Date of the Initial Term or Renewal Term, as the case may be.
Whenever the word "Term" is used in this Agreement is shall refer to either the
Initial Term or the Renewal Term, as the case may be.
(c) Location of Employment. Effective upon the date of this Agreement,
and through the Initial Term the Corporation shall maintain an office for
Executive at 000 Xxxxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxx 00000, or such
other location upon which the Corporation and Executive shall mutually agree at
which location Executive shall carry out her duties.
2. Duties.
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(a) During the period of employment as provided in Paragraph 1(b) hereof,
Executive shall serve as Chief Financial Officer of the Corporation, and shall
have all powers and duties consistent with such position subject to the
direction of the Board. Such duties shall include, without limitation, the
following:
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(i) Chief Financial Officer. The primary duties and responsibilities
of the Chief Financial Officer consist of the following: to establish overall
financial practices and procedures necessary to maintaining effective accounting
control over all aspects of the Corporation and its subsidiaries. In addition,
the Chief Financial officer will have primary responsibility for the appropriate
management and investment of the corporation's assets, particularly cash, to
maximize the highest possible rate of return. Additional responsibilities will
include dealing primarily with the Corporation's independent auditors, financial
institutions, particularly commercial banks and financial analysts, the
preparation, based upon information obtained from appropriate personnel, of an
annual budget, both consolidated and unconsolidated and additional interim
reports as will permit her to maintain effective control and supervision on a
continuing basis of the Corporation's financial results or operations and
financial status, and such further responsibilities as are delegated to
Executive by the President and Chief Executive Officer of the Corporation.
(b) Executive shall devote substantially her entire professional time,
attention and energy exclusively to the business and affairs of the Corporation
and its subsidiaries, as its business and affairs now exist and as they
hereafter may be changed, and shall not during the term of her employment
hereunder be engaged in any other business activity whether or not such business
activity is pursued for gain or profit. The foregoing shall not be construed as
preventing Executive from (a) managing her personal investments or investing her
assets in such form or manner as will not require any significant services on
her part in the operation of the affairs of the businesses or entities in which
such investments are made, provided Executive shall not invest in any business
competitive with the Corporation and its affiliates, except those companies
whose securities are listed on a national securities exchange or quoted daily in
the Over-the-Counter Market listing of the The Wall Street Journal; or (B)
preclude Executive from continuing to serve on the board of directors of any
business corporation or any charitable organization on which she now serves and
which has been disclosed to the Corporation in writing or, subject to the prior
approval of the Board, from accepting employment to additional board of
directors, provided that such activities do not materially interfere with the
performance of Executive's duties hereunder.
(c) Executive further agrees that during the term of her employment under
this Agreement she will engage in no business or other activities, directly or
indirectly, which are or may be competitive with or which might place her in a
competing position to that of the Corporation and its affiliates without
obtaining the prior written consent of the Board, including, without limitation,
the solicitation or acceptance of consulting work from clients of the
Corporation and its affiliates for whom she has performed services by virtue of
this Agreement or who she has met in connection with her employment under this
Agreement.
3. Compensation.
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(a) Base Salary. For services performed by Executive for the Corporation
pursuant to this Agreement during the first year January 1, 2000 to December 31,
2000, the Corporation shall pay Executive a base salary at the rate of
$42,000.00 per year (the "Base Salary"), payable in accordance with the
Corporation's normal payroll practices but in no event less than once a month.
Any compensation paid to Executive under any additional compensation or
incentive plan of the Corporation, or that may be otherwise authorized from time
to time by the Board, shall be in addition to the base salary to which Executive
shall be entitled under this Agreement.
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(b) Tax Withholding. The Corporation shall provide for the withholding of
any taxes required to be withheld by federal, state and local law with respect
to any payment in cash, shares of capital stock or other property made by or on
behalf of the corporation to or for the benefit of Executive under this
Agreement or otherwise. The Corporation may, at its option: (I) withhold such
taxes from any cash payments owing to the Corporation to Executive, including
any payments owing under any other provision of this Agreement, (ii) require
Executive to pay to the Corporation in cash such amount as may be required to
satisfy such withholding obligations or (iii) make other satisfactory
arrangements with Executive to satisfy such withholding obligations.
4. Benefits.
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In addition to the base Salary, Executive shall also be entitled to the
following:
(a) Participation in Benefit Plans. Executive shall be entitled to
participate in the various retirement, welfare, fringe benefit, group long-term
disability plans and other executive perquisite plans, programs and arrangements
of the Corporation available for senior executive level officers of the
Corporation. Executive and her dependents, at Executive's request shall be
enrolled in the Corporation's health, life, disability and other insurance plans
and programs immediately upon her commencement of employment hereunder.
(b) Vacation and Sick Leave. Executive shall be entitled to two weeks of
vacation during each calendar year during which this Agreement is in effect, or
such greater period as the Board may approve, and to paid holidays given by the
Corporation to its domestic employees generally, without reduction in salary or
other benefits. Executive shall also be entitled to sick leave according to the
sick leave policy, which the Corporation may adopt from time to time.
(c) Basic Stock Option. Executive shall be eligible for grants of stock
options in accordance with the Corporation's 1998 Stock Option Plan or such
other stock option plan developed by the Board.
(d) Expenses. The Corporation shall reimburse Executive, upon proper
accounting, for reasonable business expenses and disbursements incurred by her
in the course of the performance of her duties under this Agreement and in
accordance with the Corporation's policies as in effect from time to time.
(e) Proration of Benefits. Any payments or benefits hereunder, in any year
during which Executive is employed by the Corporation for less than the entire
year shall, unless otherwise provided in the applicable plan or arrangement, be
prorated in accordance with the number of days in such year during which
Executive is employed by the Corporation.
5. Indemnification and Insurance.
-----------------------------------
Executive shall be entitled to the maximum indemnification provided by the
Bylaws and the Articles of Incorporation of the Corporation for officers and
employees of the Corporation. Executive's rights under this Paragraph shall
continue without time limit so long as he may be subject to any such liability,
whether or not the Term of employment has ended. The Corporation shall obtain
and maintain, in effect, officers and directors liability insurance in an amount
not less than $1,000,000 without time limit so long as Executive may be subject
to any such liability, whether or not the Term of employment has ended.
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6. Representations and Warranties of Executive.
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Executive hereby represents and warrants to the Corporation that (a) Executive's
execution and delivery of this Agreement and her performance of her duties and
obligations hereunder will not conflict with, or cause a default under, or give
any party a right to damages under, or to terminate, any other agreement to
which Executive is a party or by which she is bound, and (b) there are no
agreements or understandings that would make unlawful Executive's execution or
delivery of this Agreement or her employment hereunder.
7. Representations and Warranties of the Corporation. The Corporation hereby
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represents and warrants to Executive as follows:
(a) The Corporation is duly organized and established as a corporation
under the laws of the State of Nevada and has all requisite power and authority
to enter into this agreement and to perform its obligations hereunder. The
consummation of the transactions contemplated by this Agreement will neither
violate nor be in conflict with any agreement or instrument to which the
Corporation is a party or by which it is bound.
(b) The execution, delivery and performance of this Agreement and the
transactions contemplated hereby have been duly and validly authorized by all
requisite corporate action on the part of the Corporation and are valid, legal
and binding obligations of the Corporation, enforceable in accordance with their
terms except as may be limited by the laws of general application relating to
bankruptcy, insolvency, moratorium or other similar laws relating to or
affecting the enforcement or creditors' rights, and rules of law governing
specific performance, injunctive relief or other equitable remedies.
8. Termination.
---------------
(a) Cause. The Corporation may terminate Executive's employment at any
time for Cause (as defined herein), by reason of Disability (as defined herein),
or without Cause; provided, however, that for any reason constituting Cause,
Executive is given (x) reasonable notice ("Notice of Termination for Cause")
setting forth the reasons for the Corporation's intention to terminate for Cause
and the effective date of such termination (which effective date may be the date
of such notice), (y) an opportunity for Executive, together with her counsel, to
be heard before the Board within two weeks of such notice and (z) within five
(5) business days after Executive's hearing before the Board, written notice to
Executive from the Board of its good faith determination that the reasons
specified in the Notice of Termination for Cause constitute Cause under this
Paragraph 8(a), and that Executive's employment is terminated effective as of
the date specified in the Notice of Termination for Cause. Executive's rights
to receive her salary and benefits hereunder shall not be affected during the
period between the receipt of the Notice of Termination for Cause and the
determination, if any, by the Board that the reasons specified in such notice
constituted Cause. For purposes of this Agreement, "Cause" means:
(i) Executive commits a breach of any material term of this
Agreement, or any material obligation of the Corporation, and such breach
constitutes gross negligence or willful misconduct and, if such breach is
capable of being cured, Executive Fails to cure such breach within 30 days of
notice of such breach;
(ii) Executive is convicted of, or pleads guilty or nolo contendere to
a felony;
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(iii) Executive's commission of any act that would cause any license of
the Corporation or its subsidiaries or affiliates to be revoked, suspended, or
not be renewed after proper application;
(iv) gross negligence in the performance of Executive's duties and
responsibilities;
(v) refusal of Executive to follow proper and achievable written
direction of the Board, provided that this shall not be Cause if Executive in
good faith believes the direction to be illegal, unethical or immoral and so
notifies the Board;
(vi) material fraud or dishonesty with regard to the Corporation
(other than good faith expense account disputes); or
(vii) continuous refusal to attempt to perform Executive's
responsibilities and duties after written notice.
(b) Good Reason. Executive may terminate her employment at any time for
any of the following reasons (each of which is referred to herein as "Good
Reason") by giving the Corporation notice of the effective date of such
termination (which effective date may be the date of such notice):
(i) the Corporation commits a breach of any material term of this
Agreement and, if such breach is capable of being cured, the Corporation fails
to cure such breach within 30 days of receipt of notice of such breach; or
(ii) a material change of position, duties or the assignments of
duties materially inconsistent with Executive's position as Executive Officer of
the Corporation.
(c) Change in Control. Executive may, at her option, terminate her
employment upon a "Change in Control." For purposes of this Agreement, "Change
of Control" shall mean:
(i) the obtaining by any party of fifty percent (50%) of more of the
voting shares of the Corporation pursuant to a "tender offer" for such shares as
provided under Rule 14d-2 promulgated under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), or any subsequent comparable federal rule or
regulation governing tender offers; or
(ii) individuals who were members of the Board immediately prior to
any particular meeting of the Corporation's shareholders which involves a
contest for the election of directors fail to constitute a majority of the
members of the Board following such election; or
(iii) the Corporation's executing an agreement concerning the sale of
substantially all of its assets to a purchaser which is not a subsidiary; or
(vi) the Corporation's adoption of a plan of dissolution or
liquidation;
(v) the Corporation's executing an agreement concerning a merger of
consolidation involving the Corporation in which the Corporation is not the
surviving corporation or if, immediately following such merger or consolidation,
less than fifty percent (50%) of the surviving corporation's outstanding voting
stock is held by persons who are stockholders of the Corporation immediately
prior to such merger of consolidation.
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(d) Executive's Rights to Terminate. Executive may, at her option,
terminate her employment hereunder for any reason upon 60 days' prior written
notice to the Corporation.
(e) Death. This Agreement shall terminate automatically upon Executive's
death.
(f) Disability. The term "Disability" as used in connection with
termination of the employment of Executive shall mean the inability of Executive
to substantially perform her material duties hereunder due to physical or mental
disablement which continues for a period of six (6) consecutive months, during
the term of employment (during which six (6) month period Executive's salary and
benefits shall continue) as determined by an independent qualified physician
mutually acceptable to the Corporation and Executive (or her personal
representative). Notwithstanding the above, in the event of Disability,
Executive shall be entitled to participate in and be covered by the
Corporation's group health plan until Executive is able to obtain health
insurance on substantially the same terms and conditions as provided in the
Corporation's group health plan; provided, however, that if the Corporation's
group health plan does not allow Executive and her dependents to continue
coverage, then the Corporation and Executive agree to negotiate a mutually
satisfactory alternative to provide Executive with the benefits intended by this
Paragraph 8(f).
(g) Without Cause. The Corporation may, at its option, terminate
Executive's employment without Cause at any time upon written notice to
Executive.
(h) Date of Termination. For purposes of this Agreement, the term "Date of
Termination" shall mean the date that any party gives notice, through action or
otherwise, that it intends to terminate this Agreement pursuant to the terms
hereof or the date, if any, specified by the terminating party in such notice as
the effective date of termination; provided, however, with respect to
termination for Cause, the Date of Termination shall be the date of receipt by
Executive of written notice form the Board as required by Paragraph 8(a) hereof.
In addition, where Executive gives notice to terminate this Agreement and the
effective date of termination is other than the date the Corporation receives
notice of termination, the Corporation reserves the right to accelerate the
Termination Date to the date Executive notified the Corporation of his intent to
terminate this Agreement.
9. Obligations of the Corporation Upon Termination.
--------------------------------------------------------
(a) Without cause or for Good Reason. If the Corporation shall terminate
Executive's employment without Cause or if Executive shall terminate her
employment for Good Reason, this Agreement shall terminate without further
obligation to Executive hereunder, other that the obligation (i) to continue to
pay Executive in accordance with the Corporation's normal payroll payment
procedures her Base Salary from the Date of Termination at the rate in effect on
the Date of Termination through the next anniversary of the Effective Date; and
(ii) to continue to provide Executive with the benefits set forth in Paragraph
4(a) through the next anniversary of the Effective Date.
(b) Voluntary. If Executive terminates her employment for other than Good
Reason (a "Voluntary Termination"), this Agreement shall terminate without
further obligation to Executive hereunder, other than the obligation (i) to
continue to pay Executive in accordance with the Corporation's normal payroll
payment procedures her Base Salary through the Date of Termination at the rate
in effect on the Date Termination; and (ii) to continue to provide Executive
with benefits of the type described in Paragraph 4(a) through the day preceding
the Date of Termination.
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(c) Cause. If Executive's employment shall be terminated by the
Corporation for "Cause" the Corporation shall continue to pay Executive her Base
Salary through the Date of Termination at the rate in effect upon the Date of
Termination. Thereafter, the Corporation shall have no further obligation to
Executive.
(d) Death. If Executive's employment is terminated by reason of
Executive's death, the corporation shall pay to Executive's heirs or estate, the
Base Salary at the rate in effect on the day preceding death through the next
anniversary of the Effective Date, in one lump sum, payable within sixty days of
the date of death.
(e) Disability. If Executive's employment is terminated by reason of
Disability, the Corporation shall (i) continue in accordance with the
Corporation's normal payroll payment procedures to pay Executive her Base Salary
form the Date of Termination at the rate in effect on the Date of Termination,
through the next anniversary of the Effective Date; provided, however, that if
an event or condition is determined to be the cause of Disability, by an
independent qualified physician acceptable to Executive and the Corporation, and
such event or condition occurs at any time in the last six months of the Term,
then the Corporation shall continue to pay Executive her Base Salary in
accordance with the Corporation's normal payroll procedures for a period of Six
(6) months beyond the Term; and (ii) continue to provide Executive with benefits
of the type described in Paragraph 4(a) through the next anniversary of the
Effective Date; provided, however, that if the Corporation's group health plan
does not allow Executive and her dependents to continue coverage, then the
Corporation and Executive agree to negotiate a mutually satisfactory alternative
to provide Executive with the benefits intended by this Paragraph 9(e).
(f) Change of Control. If Executive terminates her employment within 90
days following a Change of Control, the Corporation shall (i) continue in
accordance with the Corporation's normal payroll payment procedures to pay
Executive her Base Salary at the rate in effect on the Date of Termination
through the next anniversary of the Effective Date; and (ii) continue to provide
Executive with benefits of the type described in Paragraph 4(a) through the day
preceding the Date of Termination.
10. Non-Competition.
--------------------
Executive acknowledges and recognizes the highly competitive nature of the
Corporation and its affiliates and Executive accordingly covenants and agrees,
that at all times for a period of twelve (12) consecutive months subsequent to
the end of the Term or the Date of Termination, whichever occurs earlier, as
follows:
(a) Executive will not directly or indirectly own, manage, operate,
finance, join control or participate in the ownership, management, organization
, financing or control of, or be connected as an officer, director, employee,
partner, principal, agent, representative, consultant or otherwise with any
business or enterprise engaged in a business the same as or substantially
similar to the business of the Corporation and its affiliates except as a holder
of fewer that 5% of the outstanding shares or other equity interests of a
company whose shares or other equity interests are registered under Section 12
of the Exchange Act.
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(b) Executive will not directly or indirectly induce any employee of the
Corporation or any of its affiliates to engage in any activity in which
Executive is prohibited from engaging by subparagraph (a) above or to terminate
their employment with the corporation or any of its affiliates, and will not
directly or indirectly employ or offer employment to any person who was employed
by the Corporation or any of its affiliates unless such person shall have been
terminated without cause or ceased to be employed by any such entity for a
period of at least 12 months.
(c) Executive will not use or permit his name to be used in connection with
any business or enterprise engaged in the business the same as or similar to
Corporation or its affiliates or any other business engaged in by Corporation or
any of its affiliates.
(d) Executive will not use the name of the Corporation or any name similar
thereto, but nothing in this clause shall be deemed, by implication, to
authorize or permit use of such name after expiration of such period.
(e) Executive will not make any statement or take any action intended to
impair the goodwill or the business reputation of the Corporation or any of is
affiliates, or to be otherwise detrimental to the interests of the Corporation
or any of its affiliates, including any action or statement intended, directly
or indirectly, to benefit a competitor of the Corporation or any of its
affiliates, except as may be required by applicable law or by a local, state or
federal regulatory agency.
(f) Executive will not (a) disclose any customer lists or any part thereof
to any person, firm, corporation, association or other entity for any reason or
purpose whatsoever; (b) assist in obtaining any of the Corporation's customers
for any other similar business; (c) encourage any customer to terminate, change
or modify its relationship with the Corporation; or (d) solicit or divert or
attempt to solicit or divert the Corporation's customers.
(g) The Corporation shall have the right, subject to applicable law, to
inform any other third party that the Corporation reasonably believes to be, or
to be contemplating participating with Executive or receiving from Executive
properties of the Corporation in violation of this Agreement and of the rights
of the Corporation hereunder, and that participation by any such third party
with Executive in activities in violation of this Paragraph 10 may give rise to
claims by the Corporation against such third party;
(h) Executive and the Corporation agree that in light of the specialized
nature of the industry and the national-customer base of the Corporation's
business, that the restrictions set forth in this Paragraph 10 shall apply to
Executive within the territory of the United States of America. It is expressly
understood and agreed that although Executive and the Corporation consider the
restriction contained in the Paragraph 10 to be reasonable, if a final judicial
determination is made by a court of competent jurisdiction that the time or
territory or any other restriction contained in this Agreement is an
unenforceable restriction against Executive, the provisions of this Agreement
shall not be rendered void but shall be deemed amended to apply as to such
maximum time and territory and to such maximum intent as such court may
judicially determine or indicate to be enforceable. Alternatively, if any court
of competent jurisdiction finds that any restriction contained in this Agreement
is unenforceable, and such restriction cannot be amended so as to make it
enforceable, such finding shall not affect the enforceability of any of the
other restrictions contained herein; provided, however that the provisions of
this Paragraph 10 shall not apply if Executive is terminated without Cause or
Executive terminates for Good Reason.
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(i) The failure of Executive to abide by the provisions of this
Paragraph 10 shall be deemed a material breach of this Agreement. The primary
purpose of the covenant not to compete is the Corporation's legitimate interest
in protecting its economic welfare and business goodwill. The Corporation and
the Executive further agree that this covenant shall in no way be construed as a
mere limitation on competition nor shall it be construed as a restraint on
Executive's right to engage in a common calling.
11. Proprietary Information.
-----------------------------
Executive agrees that at all times during the Term of this Agreement and after
Executive is no longer employed by the Corporation, Executive shall not use for
his personal benefit, or disclose, communicate or divulge to, or use for the
direct or indirect benefit on any person, firm, association or company other
than the Corporation, any Proprietary Information. "Proprietary Information"
means information relating to the properties, prospects, products, services or
operations of the Corporation or any direct or indirect affiliate thereof that
is not generally known, is proprietary to the Corporation or such affiliate and
is made known to Executive or learned or acquired by Executive while in the
employ of the Corporation, including, by way of illustration, but not
limitation, information concerning trade secrets, processes, structures,
formulae, data and know-how, improvements, inventions, product concepts,
techniques, marketing plans, strategies, forecasts, customer lists and
information about the Corporation's employees and/or consultants (including,
without limitation, the compensation, job responsibility and job performance of
such employees and/or consultants). However, Proprietary Information shall not
include (i) at the time of disclosure to Executive such information that was in
the public domain or later entered the public domain other than as result of a
beach of an obligation herein; or (ii) subsequent to disclosure to Executive,
Executive received such information form a third party under no obligation to
maintain such information in confidence, and the third party came into
possession of such information other than as a result of a breach of an
obligation herein. All materials or articles of information of any kind
furnished to Executive by the Corporation or developed by Executive in the
course of his employment thereunder are and shall remain the sole property of
the Corporation; and if the Corporation requests the return of such information
at any time during, upon or after the termination of Executive's employment
hereunder, Executive shall immediately deliver the same to the Corporation.
12. Ownership of Proprietary Information.
--------------------------------------------
Executive agrees that all Proprietary Information shall be the sole property of
the Corporation and its assigns, and the Corporation and its assigns shall be
the sole owner of all licenses and other rights in connection with such
proprietary Information. At all times during the Term of this Agreement and
after Executive is no longer employed by the Corporation, Executive will keep
the strictest confidence and trust all Proprietary Information and will not use
or disclose such Proprietary Information, or anything relating to such
information, without the prior written consent of the Corporation, except as
many be necessary in the ordinary course of performing his duties under this
Agreement.
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13. Documents and Other Property.
------------------------------------
All materials or articles of information of any kind furnished to Executive in
the course of his employment hereunder are and shall remain the sole property of
the Corporation; and if the Corporation requests the return of such information
at any time during, upon or after the termination of Executive's employment
hereunder, Executive shall immediately deliver the same to the Corporation.
Executive will not, without the prior written consent of the Corporation, retain
any documents, data or property, or any reproduction thereof of any description,
belonging to the Corporation or pertaining to any Proprietary Information.
14. Third-Party Information.
-----------------------------
The Corporation from time to time receives from third parties confidential or
proprietary information subject to a duty on the Corporation's part to maintain
the confidentiality of such information and to use it only for certain limited
purposes ("Third-party Information"). At all times, until after the later of
(a) the Expiration Date, (b) the fifth anniversary of the Date of Termination or
(c) the period of time the Corporation must maintain the Third-Party Information
as confidential, Executive will hold Third-Party Information in the strictest
confidence and will not disclose or use Third-Party Information except as
permitted by the agreement between the Corporation and such third party.
15. Intellectual Property.
---------------------------
Any and all improvements, inventions, designs, ideas, works of authorship,
copyrightable works, discoveries, trademarks, copyrights, trade secrets,
formulae, processes, techniques, know-how, and data, whether or not patentable
(collectively "Products"), made or conceived or reduced to practice or learned
by Executive, either along or jointly with others, during the period of
Executive's employment (whether or not during normal working hours) that are
related to or useful in the actual or anticipated business of the Corporation,
or result from tasks assigned Executive by the Corporation or result from
Executive's use of premises or equipment owned, leased, or contracted for by the
Corporation (a) during the period of this Agreement, or (b) within a period of
one year after the Date of Termination, which may be directly or indirectly
useful in, or relate to, the business of the Corporation, shall be promptly and
fully disclosed by Executive to the Board and, if such intellectual property was
made, developed or created pursuant to Executive's employment hereunder, such
intellectual property shall be the Corporation's exclusive property as against
Executive, and Executive shall promptly deliver to an appropriate representative
of the Corporation as designated by the Board all papers, drawings, models, data
and other material relating to any invention made, developed or created by him
as aforesaid. Executive shall, at the request of the Corporation and without
any payment therefor, execute any documents necessary or advisable in the
opinion of the Corporation's counsel or direct issuance of patents or copyrights
to the Corporation with respect to such Products as are to be the Corporation's
exclusive property as against Executive or to vest in the Corporation title to
such Products as against executive. The expense of securing any such patent or
copyright shall be borne by the Corporation. Executive shall be compensated, in
accordance with the Corporation's "Creative Awards" standard policy, for all
Products created or developed by the Executive either prior to his employment
(if delivered to the Corporation) or during the term of his Employment.
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16. Equitable Relief.
----------------------
Executive acknowledges that, in view of the nature of the business in which the
Corporation is engaged, the restrictions contained in paragraphs 10 through 15,
inclusive (the "Restrictions") are reasonable and necessary in order to protect
the legitimate interest of the Corporation, and that any violation thereof would
result in irreparable injuries to the Corporation, and Executive therefor
further acknowledges that, if Executive violates, or threatens to violate, any
of the Restrictions, the Corporation shall be entitled to obtain from any court
of competent jurisdiction, without the posting of any bond or other security,
preliminary and permanent injunctive relief as well as damages and an equitable
accounting of all earnings, profits and other benefits arising from such
violation, which rights shall be cumulative and in addition to any other rights
or remedies in law or equity to which the Corporation may be entitled.
17. Binding Effect.
--------------------
This Agreement shall be binding upon and inure to the benefit of the heirs and
representatives of Executive and the successors and assigns of the Corporation.
The Corporation shall require any successor (whether direct or indirect, by
purchase, merger, reorganization, consolidation, acquisition of property or
stock, liquidation or otherwise) to all or a significant portion of its assets,
by agreement in form and substance satisfactory to Executive, expressly to
assume and agree to perform this Agreement in the same manner and to the same
extent that the Corporation would be required to perform this Agreement if no
such succession had taken place. Regardless whether such agreement is executed,
this Agreement shall be binding upon any successor of the Corporation in
accordance with the operation of law and such successor shall be deemed the
"Corporation," for purposes of this Agreement.
18. Notices.
------------
All notices, requests, demands and other communications hereunder shall be in
writing and shall be deemed to have been duly given if delivered by hand or
mailed within the continental United States by first-class certified mail,
return receipt requested, postage prepaid, addressed as follows:
(a) if to the Board or the Corporation, to:
Nanopierce Technologies, Inc.
000 Xxxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attention: President
(b) if to Executive:
Xxxxxx X. Xxxxxxxx
000 Xxxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Such addresses may be changed by written notice sent to the other party at the
last recorded address of that party.
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19. Arbitration of All Disputes.
-----------------------------------
(a) Any controversy or claim arising out of or relating to this Agreement
or the breach thereof (including the arbitrability of any controversy or claim),
shall be settled by arbitration in the City of Denver in accordance with the
laws of the State of Colorado by three arbitrators, one of whom shall be
appointed by the Corporation, one by Executive and the third of whom shall be
appointed by the first two arbitrators. If the first two arbitrators cannot
agree on the appointment of a third arbitrator, then the third arbitrator shall
be appointed by the American Arbitration Association. The arbitration shall be
conducted in accordance with the rules of the American Arbitration Association,
except with respect to the selection of arbitrators which shall be as provided
in this paragraph 19. The cost of any arbitration proceeding hereunder shall be
borne equally by the Corporation and Executive. The award of the arbitrators
shall be binding upon the parties. Judgment upon the award rendered by the
arbitrators may be entered in any court having jurisdiction thereof.
(b) If it shall be necessary or desirable for Executive to retain legal
counsel and incur other costs and expenses in connection with the enforcement of
any or all of his rights under this Agreement, and provided that Executive
substantially prevails in the enforcement of such rights, the Corporation shall
pay (or Executive shall be entitled to recover from the Corporation, as the case
may be) Executive's reasonable attorneys' fees and costs and expenses in
connection with the enforcement of his rights including the enforcement of any
arbitration award.
20. No Assignment.
-------------------
Except as otherwise expressly provided herein, this Agreement is not assignable
by any party and no payment to be made hereunder shall be subject to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance or
other charge.
21. Execution in Counterparts.
--------------------------------
This Agreement may be executed by parties hereto in two or more counterparts,
each of which shall be deemed to be an original, but all such counterparts shall
constitute one and the same instrument. The facsimile signature of any party to
this Agreement shall be considered an original signature of such person.
22. Jurisdiction and Governing Law.
--------------------------------------
Jurisdiction over disputes with regard to this Agreement shall be exclusively in
the courts of the State of Colorado, and this Agreement shall be construed and
interpreted in accordance with and governed by the laws of the State of
Colorado, other than the conflict of laws provisions of such laws.
23. Severability.
-----------------
If any provision of this Agreement shall be adjudged by any court of competent
jurisdiction to be invalid or unenforceable for any reason, such judgment shall
not affect, impair or invalidate the remainder of this Agreement.
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24. Entire Agreement.
----------------------
This Agreement embodies the entire agreement of the parties hereof, and
supersedes all other oral or written agreements or understandings between them
regarding the subject matter hereof. No change, alteration or modification
hereof may be made except in a writing, signed by each of the parties hereto.
25. Headings Descriptive.
--------------------------
The headings of the several paragraphs of this Agreement are inserted for
convenience only and shall not in any way affect the meaning or construction of
any of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first above written.
NANOPIERCE TECHNOLOGIES, INC.
By: __________________________________
Xxxx X. Xxxxxxxxx, President & CEO
EXECUTIVE
By: _________________________________
Xxxxxx X. Xxxxxxxx
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