EXHIBIT 10.28
EMPLOYMENT AGREEMENT
This AGREEMENT (the "Agreement") is made as of the date signed (the
"Effective Date"), by and between Incentra Solutions, Inc., a Nevada corporation
with its headquarters located in Boulder, Colorado (the "Employer"), and Xxxxxxx
X. Xxxxxxx (the "Executive"). In consideration of the mutual covenants contained
in this Agreement, the Employer and the Executive agree as follows:
1. EMPLOYMENT. The Employer agrees to employ the Executive and the
Executive agrees to be employed by the Employer on the terms and conditions set
forth in this Agreement.
2. CAPACITY; LOCATION. The Executive shall serve the Employer as
President. In his capacity as President, Executive will report to the Chief
Executive Officer, and shall be responsible for strategic and operational
matters relating to the Employer's overall business requirements subject to the
direction of the Chief Executive Officer. In such capacity, the Executive shall
perform such services and duties in connection with the business, affairs and
operations of the Employer as may be assigned or delegated to the Executive from
time to time by or under the authority of the Chief Executive Officer.
Executive's employment with Employer will be based in Employer's Broomfield,
Colorado offices; PROVIDED, that Employee may be required from time to time to
travel in connection with Employer's business needs.
3. TERM. The term of this Agreement shall be two (2)years, subject to
the provisions of Section 6, the employment relationship described herein may be
terminated by either Executive or Employer at any time.
4. COMPENSATION AND BENEFITS. The regular compensation and benefits
payable to the Executive under this Agreement shall be as follows:
(a) SALARY. For all services rendered by the Executive under
this Agreement, the Employer shall pay the Executive a salary (the
"Salary") at the annual rate of Two Hundred Thousand Dollars
($200,000.00), subject to increase from time to time in the discretion of
the Compensation Committee of the Board of Directors (the "Compensation
Committee"). The Salary shall be payable in periodic installments in
accordance with the Employer's usual practice for its senior executives.
(b) BONUS. For the fiscal year ending December 31, 20005
Executive shall be eligible for a bonus of up to Thirty Seven Thousand
Five Hundred Dollars ($37,500.00) per quarter based upon performance at
100% of plan. If performance exceeds plan by 10% or more, Executive will
be eligible for an additional bonus payment. Performance is evaluated by
the Board and any non-guaranteed bonus is in the discretion of the Board.
Thereafter, Executive shall be eligible to participate in an incentive
program established by the Compensation Committee, with such terms as may
be established in the sole discretion of the Compensation Committee.
(c) REGULAR BENEFITS. The Executive shall be reimbursed for an
individual health insurance policy to a maximum of Seven Hundred Fifty
Dollars ($750.00) per month or shall be entitled to health insurance
benefits from Employer, and shall also be entitled to participate in any
employee benefit plans, life insurance plans, disability income plans,
retirement plans, expense reimbursement plans and other benefit plans
which the Employer may from time to time have in effect for all or most
of its executive management employees. Such participation shall be
subject to the terms of the applicable plan documents, generally
applicable policies of the Employer, applicable law and the discretion of
the Board of Directors, the Compensation Committee or any administrative
or other committee provided for in or contemplated by any such plan.
Except with respect to the aforementioned health insurance benefits,
nothing contained in
this Agreement shall be construed to create any obligation on the part of
the Employer to establish any such plan or to maintain the effectiveness
of any such plan which may be in effect from time to time.
(d) ADDITIONAL LIFE INSURANCE. Employer will provide term life
insurance in the amount of three times the Executive's base salary.
(e) VACATION. The Executive shall be entitled to four weeks of
vacation, such vacation time to accrue on a per-pay-period basis.
(e) TAXATION OF PAYMENTS AND BENEFITS. The Employer shall
undertake to make deductions, withholdings and tax reports with respect
to payments and benefits under this Agreement to the extent that it
reasonably and in good faith believes that it is required to make such
deductions, withholdings and tax reports. Payments under this Agreement
shall be in amounts net of any such deductions or withholdings. Nothing
in this Agreement shall be construed to require the Employer to make any
payments to compensate the Executive for any adverse tax effect
associated with any payments or benefits or for any deduction or
withholding from any payment or benefit.
(f) CAR ALLOWANCE. Executive shall be entitled to a car
allowance of $750.00 per month for the term of this Agreement.
(g) EXPENSES. The Employer shall reimburse the Executive for
all reasonable and necessary business related travel expenses incurred or
paid by the Executive in performing his duties under this Agreement and
which are consistent with applicable policies of the Employer. All
payments for reimbursement of such expenses shall be made upon
presentation by the Executive of expense statements or vouchers and such
other supporting information as the Employer may from time to time
reasonably request.
(h) STOCK OPTIONS. Executive shall also be eligible for
participation in Employer's Stock Option Plan and Executive shall be
entitled to receive stock options pursuant to the terms of option
agreements.
(i) EXCLUSIVITY OF SALARY AND BENEFITS. The Executive shall not
be entitled to any payments or benefits other than those provided under
this Agreement.
5. EXTENT OF SERVICE. During the Executive's employment under this
Agreement, the Executive shall devote the Executive's full business time, best
efforts and business judgment, skill and knowledge to the advancement of the
Employer's interests and to the discharge of the Executive's duties and
responsibilities under this Agreement. The Executive shall not engage in any
other business activity, except as may be approved by the Board of Directors;
PROVIDED, that nothing in this Agreement shall be construed as preventing the
Executive from:
(a) investing the Executive's assets in any company or other
entity in a manner not prohibited by Section 7(d) and in such form or
manner as shall not require any material activities on the Executive's
part in connection with the operations or affairs of the companies or
other entities in which such investments are made; and
2
(b) engaging in religious, charitable or other community or
non-profit activities that do not impair the Executive's ability to
fulfill the Executive's duties and responsibilities under this Agreement.
6. TERMINATION AND TERMINATION BENEFITS. Notwithstanding the
provisions of Section 3, the Executive's employment under this Agreement shall
terminate under the following circumstances set forth in this Section 6.
(a) TERMINATION BY THE EMPLOYER FOR CAUSE. The Executive's
employment under this Agreement may be terminated for "Cause" without
further liability on the part of the Employer, effective immediately upon
a vote of the Board of Directors and written notice to the Executive.
Only the following shall constitute "Cause" for such termination:
(i) dishonest or fraudulent statements or acts of the
Executive with respect to the Employer or any affiliate of the
Employer;
(ii) the Executive's conviction of, or entry of a plea of
guilty or nolo contendere for, (A) a felony or (B) any misdemeanor
(excluding minor traffic violations) involving moral turpitude,
deceit, dishonesty or fraud;
(iii) gross negligence, willful misconduct or
insubordination of the Executive with respect to the Employer or
any affiliate of the Employer; or
(iv) material breach by the Executive of any of the
Executive's obligations under this Agreement, or any other
agreement to which Executive and Employer are now or hereafter a
party to.
(b) TERMINATION BY THE EXECUTIVE. The Executive's employment
under this Agreement may be terminated by the Executive by written notice
to Employer at least thirty (30) days prior to such termination.
(c) TERMINATION BY THE EMPLOYER WITHOUT CAUSE. Subject to the
payment of Termination Benefits pursuant to Section 6(d), the Executive's
employment under this Agreement may be terminated by the Employer without
Cause upon written notice to the Executive (a termination "Without
Cause").
(d) CERTAIN TERMINATION BENEFITS. Unless otherwise specifically
provided in this Agreement or otherwise required by law, all compensation
and benefits payable to the Executive under this Agreement shall
terminate on the date of termination of the Executive's employment under
this Agreement. Notwithstanding the foregoing, in the event of
termination of the Executive's employment with the Employer Without Cause
pursuant to Section 6(c) above, the Employer shall provide to the
Executive the following termination benefits ("Termination Benefits"):
(i) payment of the Executive's Salary at the rate then
in effect pursuant to Section 4(a) for the period from the date of
termination until the date that is twelve (12) months after the
date of termination; and
(ii) continuation of group health plan benefits to the
extent authorized by and consistent with 29 U.S.C. ss. 1161 ET
SEQ. (commonly known as "COBRA"), with the cost of the regular
premium for such benefits shared in the same relative proportion
by the Employer and the Executive as in effect on the date of
termination for twelve (12)
3
months and at a cost of 102% of premium provided under COBRA, for
up to an additional six (6) months.
Notwithstanding the foregoing, nothing in this Section 6(d) shall
be construed to affect the Executive's right to receive COBRA
continuation entirely at the Executive's own cost to the extent that the
Executive may continue to be entitled to COBRA continuation after the
Executive's right to cost sharing under Section 6(d)(ii) ceases.
(e) DISABILITY. If the Executive shall be disabled so as to be
unable to perform the essential functions of the Executive's then
existing position or positions under this Agreement with reasonable
accommodation, the CEO may remove the Executive from any responsibilities
and/or reassign the Executive to another position with the Employer
during the period of such disability. Notwithstanding any such removal or
reassignment, the Executive shall continue to receive the Executive's
full Salary (less any disability pay or sick pay benefits to which the
Executive may be entitled under the Employer's policies) and benefits
under Section 4 of this Agreement (except to the extent that the
Executive may be ineligible for one or more such benefits under
applicable plan terms) for a period of time equal to nine (9) months. If
any question shall arise as to whether during any period the Executive is
disabled so as to be unable to perform the essential functions of the
Executive's then existing position or positions with reasonable
accommodation, the Executive may, and at the request of the Employer
shall, submit to the Employer a certification in reasonable detail by a
physician selected by the Employer to whom the Executive or the
Executive's guardian has no reasonable objection as to whether the
Executive is so disabled or how long such disability is expected to
continue, and such certification shall for the purposes of this Agreement
be conclusive of the issue. The Executive shall cooperate with any
reasonable request of the physician in connection with such
certification. If such question shall arise and the Executive shall fail
to submit such certification, the Employer's determination of such issue
shall be binding on the Executive. Nothing in this Section 6(e) shall be
construed to waive the Executive's rights, if any, under existing law
including, without limitation, the Family and Medical Leave Act of 1993,
29 U.S.C. ss.2601 ET SEQ. and the Americans with Disabilities Act, 42
U.S.C. ss.12101 ET SEQ.
7. CONFIDENTIAL INFORMATION, NONCOMPETITION AND COOPERATION.
(a) CONFIDENTIAL INFORMATION. As used in this Agreement,
"Confidential Information" means information belonging to the Employer
which is of value to the Employer in the course of conducting its
business and the disclosure of which could result in a competitive or
other disadvantage to the Employer. Confidential Information includes,
without limitation, financial information, reports, and forecasts;
inventions, improvements and other intellectual property; trade secrets;
know-how; designs, processes or formulae; software; market or sales
information or plans; customer lists; and business plans, prospects and
opportunities (such as possible acquisitions or dispositions of
businesses or facilities) which have been discussed or considered by the
management of the Employer. Confidential Information includes information
developed by the Executive in the course of the Executive's employment by
the Employer, as well as other information to which the Executive may
have access in connection with the Executive's employment. Confidential
Information also includes the confidential information of others with
which the Employer has a business relationship. Notwithstanding the
foregoing, Confidential Information does not include information in the
public domain, unless due to breach of the Executive's duties under
Section 7(b).
(b) CONFIDENTIALITY. The Executive understands and agrees that
the Executive's employment creates a relationship of confidence and trust
between the Executive and the Employer with respect to all Confidential
Information. At all times, both during the Executive's employment with
the Employer and after its termination, the Executive will keep in
confidence and trust all such Confidential Information, and will not use
or disclose any such Confidential Information without the written consent
of the Employer, except as may be necessary in the ordinary course of
performing the Executive's duties to the Employer.
4
(c) DOCUMENTS, RECORDS, ETC. All documents, records, data,
apparatus, equipment and other physical property, whether or not
pertaining to Confidential Information, which are furnished to the
Executive by the Employer or are produced by the Executive in connection
with the Executive's employment will be and remain the sole property of
the Employer. The Executive will return to the Employer all such
materials and property as and when requested by the Employer. In any
event, the Executive will return all such materials and property
immediately upon termination of the Executive's employment for any
reason. The Executive will not retain with the Executive any such
material or property or any copies thereof after such termination.
(d) NONCOMPETITION AND NONSOLICITATION. Without the prior
written consent of the CEO, during the period that Executive is employed
by Employer and (i) for one (1) year thereafter, the Executive will not,
directly or indirectly, whether as owner, partner, shareholder,
consultant, agent, employee, co-venturer or otherwise, engage,
participate, assist or invest in any Competing Business (as hereinafter
defined); (ii) for a period of two (2) years thereafter will refrain from
directly or indirectly employing, attempting to employ, recruiting or
otherwise soliciting, inducing or influencing any person to leave
employment with the Employer; and (iii) for a period of two (2) years
thereafter will refrain from soliciting or encouraging any customer or
supplier to terminate or otherwise modify adversely its business
relationship with the Employer. The Executive understands that the
restrictions set forth in this Section 7(d) are intended to protect the
Employer's interest in its Confidential Information and established
employee, customer and supplier relationships and goodwill, and agrees
that such restrictions are reasonable and appropriate for this purpose.
For purposes of this Agreement, the term "Competing Business" shall mean
any business that provides or intends to provide the same or similar
types of services or products as those provided or targeted by Employer
or any of its subsidiaries in any geographic area then served or targeted
by Employer or any of its subsidiaries. Notwithstanding the foregoing,
the Executive may own up to two percent (2%) of the outstanding stock of
a publicly held corporation.
(e) THIRD-PARTY AGREEMENTS AND RIGHTS. The Executive hereby
confirms that the Executive is not bound by the terms of any agreement
with any previous employer or other party which restricts in any way the
Executive's use or disclosure of information or the Executive's
engagement in any business. The Executive represents to the Employer that
the Executive's execution of this Agreement, the Executive's employment
with the Employer and the performance of the Executive's proposed duties
for the Employer will not violate any obligations the Executive may have
to any such previous employer or other party. In the Executive's work for
the Employer, the Executive will not disclose or make use of any
information in violation of any agreements with or rights of any such
previous employer or other party, and the Executive will not bring to the
premises of the Employer any copies or other tangible embodiments of
non-public information belonging to or obtained from any such previous
employment or other party.
(f) LITIGATION AND REGULATORY COOPERATION. During and after the
Executive's employment, the Executive shall cooperate fully with the
Employer in the defense or prosecution of any claims or actions now in
existence or which may be brought in the future against or on behalf of
the Employer which relate to events or occurrences that transpired while
the Executive was employed by the Employer. The Executive's full
cooperation in connection with such claims or actions shall include, but
not be limited to, being available to meet with counsel to prepare for
discovery or trial and to act as a witness on behalf of the Employer at
mutually convenient times. During and after the Executive's employment,
the Executive also shall cooperate fully with the Employer in connection
with any investigation or review of any federal, state or local
regulatory authority as any such investigation or review relates to
events or occurrences that transpired while the Executive was employed by
the Employer. The Employer shall reimburse the Executive for any
reasonable out-of-pocket expenses incurred in connection with the
Executive's performance of obligations pursuant to this Section 7(f) and
shall pay the Executive for his time at his annual salary rate in effect
at the time of the termination of his employment.
5
(g) DEVELOPMENTS. Executive will make full and prompt
disclosure to the Employer of all inventions, discoveries, designs,
developments, methods, modifications, improvements, processes,
algorithms, databases, computer programs, formulae, techniques, trade
secrets, graphics or images, audio or visual works, and other works of
authorship (collectively "Developments"), whether or not patentable or
copyrightable, that are created, made, conceived or reduced to practice
by Executive (alone or jointly with others) or under Executive's
direction during the period of his employment. Executive acknowledges
that all work performed by Executive for Employer hereunder is on a "work
for hire" basis, and Executive hereby assigns and transfers, and will
assign and transfer, to the Employer and its successors and assigns all
of Executive's right, title and interest, including but not limited to
all patents, patent applications, trademarks and trademark applications,
copyrights and copyright applications, and other intellectual property
rights in all countries and territories worldwide and under any
international conventions, in and to all Developments that (a) relate to
the business of the Employer or any of the products or services of the
Employer; (b) result from tasks assigned to Executive by the Employer; or
(c) result from the use of personal property (whether tangible or
intangible) owned, leased or contracted for by the Employer.
(h) INJUNCTION. The Executive agrees that it would be difficult
to measure any damages caused to the Employer which might result from any
breach by the Executive of the promises set forth in this Section 7, and
that in any event money damages would be an inadequate remedy for any
such breach. Accordingly, subject to Section 8 of this Agreement, the
Executive agrees that if the Executive breaches, or proposes to breach,
any portion of this Agreement, the Employer shall be entitled, in
addition to all other remedies that it may have, to an injunction or
other appropriate equitable relief to restrain any such breach without
showing or proving any actual damage to the Employer.
8. ARBITRATION OF DISPUTES. Any controversy or claim arising out of
or relating to this Agreement or the breach thereof or otherwise arising out of
the Executive's employment or the termination of that employment (including,
without limitation, any claims of unlawful employment discrimination whether
based on age or otherwise) shall, to the fullest extent permitted by law, be
settled by arbitration in any forum and form agreed upon by the parties or, in
the absence of such an agreement, under the auspices of the American Arbitration
Association ("AAA") in Denver, Colorado in accordance with the Employment
Dispute Resolution Rules of the AAA, including, but not limited to, the rules
and procedures applicable to the selection of arbitrators. In the event that any
person or entity other than the Executive or the Employer may be a party with
regard to any such controversy or claim, such controversy or claim shall be
submitted to arbitration subject to such other person or entity's agreement.
Judgment upon the award rendered by the arbitrator may be entered in any court
having jurisdiction thereof. This Section 8 shall be specifically enforceable.
Notwithstanding the foregoing, this Section 8 shall not preclude either party
from pursuing a court action for the sole purpose of obtaining a temporary
restraining order or a preliminary injunction in circumstances in which such
relief is appropriate; PROVIDED, that any other relief shall be pursued through
an arbitration proceeding pursuant to this Section 8.
9. CONSENT TO JURISDICTION. To the extent that any court action is
permitted consistent with or to enforce Section 8 of this Agreement, the parties
hereby consent to the jurisdiction of the courts of the State of Colorado.
Accordingly, with respect to any such court action, the Executive (a) submits to
the personal jurisdiction of such courts; (b) consents to service of process;
and (c) waives any other requirement (whether imposed by statute, rule of court,
or otherwise) with respect to personal jurisdiction or service of process.
10. INTEGRATION. This Agreement constitutes the entire agreement
between the parties with respect to the subject matter hereof and supersedes all
prior agreements between the parties with respect to any related subject matter.
11. ASSIGNMENT; SUCCESSORS AND ASSIGNS, ETC. Neither the Employer nor
the Executive may make any assignment of this Agreement or any interest herein,
by operation of law or otherwise, without the prior written consent of the other
party; PROVIDED, that the Employer may assign its rights under this
6
Agreement without the consent of the Executive in the event that the Employer
shall effect a reorganization, consolidate with or merge into any other
corporation, partnership, organization or other entity, or transfer all or
substantially all of its properties or assets to any other corporation,
partnership, organization or other entity. This Agreement shall inure to the
benefit of and be binding upon the Employer and the Executive, their respective
successors, executors, administrators, heirs and permitted assigns.
12. ENFORCEABILITY. If any portion or provision of this Agreement
(including, without limitation, any portion or provision of any section of this
Agreement) shall to any extent be declared illegal or unenforceable by a court
of competent jurisdiction, then the remainder of this Agreement, or the
application of such portion or provision in circumstances other than those as to
which it is so declared illegal or unenforceable, shall not be affected thereby,
and each portion and provision of this Agreement shall be valid and enforceable
to the fullest extent permitted by law.
13. WAIVER. No waiver of any provision hereof shall be effective
unless made in writing and signed by the waiving party. The failure of any party
to require the performance of any term or obligation of this Agreement, or the
waiver by any party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.
14. NOTICES. Any notices, requests, demands and other communications
provided for by this Agreement shall be sufficient if in writing and delivered
in person or sent by a nationally recognized overnight courier service or by
registered or certified mail, postage prepaid, return receipt requested, to the
Executive at the last address the Executive has filed in writing with the
Employer or, in the case of the Employer, at 0000 Xxxxx Xxxxxx, Xxxxxxx, XX
00000, ATTN: Chief Executive Officer, and shall be effective on the date of
delivery in person or by courier or three (3) days after the date mailed.
15. AMENDMENT. This Agreement may be amended or modified only by a
written instrument signed by the Executive and by a duly authorized
representative of the Employer.
16. GOVERNING LAW. This is a Colorado contract and shall be construed
under and be governed in all respects by the laws of the State of Colorado,
without giving effect to the conflict of laws principles of such State.
17. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.
IN WITNESS WHEREOF, this Agreement has been executed by the Employer and
by the Executive as of the Effective Date.
INCENTRA SOLUTIONS, INC.:
By: /s/Xxxxxx X. Xxxxxxx Iii
-------------------------------------
Name: Xxxxxx X. Xxxxxxx, III
Title: President & CEO
EXECUTIVE:
/s/Xxxxxxx X. Xxxxxxx
-----------------------------------------
Xxxxxxx X. Xxxxxxx
December 6, 2004
-----------------------------------------
Date
7
