THIS AGREEMENT is made the 1st day of October 2002
BETWEEN:
(1) NARROWSTEP LIMITED (registered number 4412126, whose
registered office is at 00 Xxx Xxxxxxxxx Xxxxxx, Xxxxxx, X0X 0XX (the
"Company");
AND
(2) XXXXX XXXX of 00 Xxxxxxx Xxxx, Xxxxxx, XX0 0XX (the Employee").
THE PARTIES AGREE as follows:
1 (A) Definitions
In this Agreement unless the context otherwise requires the following
expressions have the following meanings:
WORDS AND EXPRESSIONS MEANING
"the Board" the Board of the Company for the time being, or any Executive of the
Company for the time being;
"Confidential Information" information relating to the business, products,
affairs
and finances of the Company or of any, Group
Company for the time being confidential to it or to
them or treated by it or them as such and trade secrets
(including, without limitation, technical data and
know-how) relating to the business of the Company or
of any Group Company or of any of its or their
suppliers, clients or customers;
the Employment" the Employee s employment with the Company;
the " ERA" the Employment Rights Xxx 0000 as amended;
the Group the Company and the Group Companies;
"Group Company" any company which is for the time being a subsidiary
or holding company of the Company and any
subsidiary of any such holding company and for the
purposes of this Agreement the terms "subsidiary" and
"holding company" shall have the meanings ascribed to
them by sections 736 and 736A Companies Xxx 0000;
"Permitted Activities" those activities in which the Employee is permitted to
be engaged in addition to his activities as a director and
employee of the Company, as set out in Schedule 2;
the "Salary" the salary referred to in clause 6(A).
(B) References to clauses and schedules are unless otherwise stated to clauses
of and schedules to this Agreement.
(C) The headings to the clauses are for convenience only and shall not affect
the construction or interpretation of this Agreement.
2. APPOINTMENT
(A) With effect from (date) the Company appoints the Employee and the Employee
agrees to act in the capacity set out in Schedule 1 or in such other capacity as
the Company from time to time reasonably directs on the terms of this Agreement.
(B) The Company may appoint any other person or persons to act jointly with the
Employee in any position to which he may be assigned from time to time.
3. DURATION OF THE EMPLOYMENT
(A) The Employment under this Agreement shall commence on and, subject to the
provisions of this Agreement, shall continue for a fixed period of 12 months and
thereafter unless and until terminated by either party giving to the other not
less than 3 months notice in writing to expire on or at any time after the
expiry of that fixed period.
(B) Notwithstanding clause-3(A), the Employment shall terminate automatically
without the need for notice when the Employee reaches 60 years of age.
(C) The Company reserves the right to terminate the Employment without any
notice or on notice less than that required by clause 3(A) provided that if it
does so it will pay to the Employee a sum equal to, but no more than, the Salary
in respect of that part of the period of notice in clause 3(A) which the Company
has not given to the Employee less any appropriate tax and other statutory
deductions and any other deduction considered by the Company to be appropriate
and reasonable to take account of accelerated receipt and the Employee s duty to
mitigate his loss.
(D) At any time during any period of notice (whether given by the Company or the
Employee), the Company shall be under no obligation to assign any duties to the
Employee and shall be entitled to exclude him from its premises and/or the
Company may require the Employee to carry out specified projects, provided that
this shall not affect the Employee s entitlement to receive the Salary and other
contractual benefits.
(E) For the purposes of the ERA the Employee s period of continuous employment
with the Company began on 1 October 2002 The Employee s employment with the
Company and is not continuous with any previous employment with any previous
employer.
(F) The Employee represents and warrants that he is not bound by or subject to
any court order, agreement, arrangement or undertaking which in any way
restricts or prohibits him from entering into this Agreement or from performing
his duties under it.
4. SCOPE OF THE EMPLOYMENT
(A) During the Employment the Employee shall:
(i) devote the whole of his time, attention and skill to the business and
affairs of the Company both -during normal business hours (as set out in
Schedule 1) and during such additional hours as are necessary for the proper
performance of his duties or as the Board may reasonably require from time to
time subject to the Employee s ability to carry out Permitted Activities to the
extent set out in Schedule 2;
(ii) faithfully and diligently perform such duties and exercise such powers
consistent with his position as may from time to time be assigned to or vested
in him by the Board to a standard that is acceptable to the Board;
obey the reasonable and lawful directions of the Board;
comply with all the Company s rules, regulations, policies and procedures from
time to time in force; and
(B) The Employee agrees, for the purposes of Regulation 5 of The Working Time
Regulations 1998 (the Regulations ), that Regulation 4 of the Regulations does
not apply to him. The Company and the Employee agree that the Employee s
consent, for the purpose of this clause 4
(B), shall continue indefinitely provided that the Employee may withdraw such
consent at any time by giving the Company three months notice of his wish to do
so.
(C) The Employee acknowledges the obligations on the Company to maintain up to
date records and accordingly undertakes to provide the Company with such records
as are necessary to enable the Company to comply with the Regulations.
5. PLACE OF WORK
(A) The Employee s place of work will initially be the Company s offices at 00
Xxx Xxxxxxxxx Xxxxxx, Xxxxxx, X0X 0XX, but the Company may require the Employee
to work at any place (whether inside or outside the United Kingdom) for such
periods as the Company may from time to time require, including home working.
(B) The Company shall have the right to require the Employee to move house to an
appropriate location for the better performance of his duties. The Employee will
be given reasonable notice of any such requirements and the Company will
reimburse to him all expenses incurred by him in such a move as it may consider
reasonable in all the circumstances.
6. REMUNERATION
(A) The Company shall pay to the Employee a salary at the rate set out in
Schedule 1, on the last day of each calendar month by equal monthly instalments
in arrears (or such other sum as may from time to time be agreed). The rate of
salary will be reviewed annually or more regularly at the Company s discretion.
(B) For the purposes of the Employment Rights Xxx 0000 and otherwise the
Employee consents to the deduction of any sums owing by him to the Company at
any time from his salary or any other payment due from the Company to him. The
Employee also agrees to make any payment to the Company of any sums owed by him
to the Company upon demand by the Company at any time.
7. EXPENSES
(A) The Company shall reimburse the Employee in respect of all expenses
reasonably incurred by him in the proper performance of his duties, subject to
his providing such receipts or other appropriate evidence as the Company may
require.
8. HOLIDAYS
(A) The Employee shall be entitled, in addition to all Bank and Public holidays
normally observed in England, to the number of working days paid holiday as set
out in Schedule 1 in each holiday year (being the period from 1 January to 31
December). The Employee may take his holiday only at such times as are agreed
with the Board.
(B) In the respective holiday years in which the Employment commences or
terminates, the Employee s entitlement to holiday shall accrue on a pro rata
basis for each completed calendar month of service during the relevant year.
(C) If, on the termination of the Employment, the Employee has exceeded his
accrued holiday entitlement, the value of such excess, calculated by reference
to clause 8(B) and the Salary, may be deducted from ally sums due to him and if
there are no such sums due, the Employee shall repay such excess to the Company
on such termination. If the Employee has any unused holiday entitlement, the
Company may either require the Employee to take such unused holiday during any
notice period or make a payment to him in lieu of it, calculated as above.
Holiday entitlement for one holiday year cannot be taken in subsequent holiday
years unless otherwise agreed by the Board. Failure to take holiday entitlement
in the appropriate holiday year will lead to forfeiture of any accrued holiday
not taken without any right to payment in lieu of it.
The Employee may take unpaid leave at the Board s discretion.
The Employee will be entitled to compassionate leave at the Board s discretion.
9. SICKNESS BENEFITS
(A) Subject to clause 14 the Company shall continue to pay the Employee s salary
for up to a maximum of the number of working days absence as set out in Schedule
1 on medical grounds in any period of 3 calendar months provided that the
Employee shall from time to time if required:
supply the Company with medical certificates covering any period of sickness or
incapacity exceeding seven days (including weekends); and
undergo at the Company s expense, by a doctor appointed by the Company, any
medical examination.
(B) Payment in respect of any other or further period of absence shall be at the
Company s discretion.
(C) Any payment to the Employee pursuant to clause 9(A) shall be subject to set
off by the Company in respect of any Statutory Sick Pay and any Social Security
Sickness Benefit or other benefits to which the Employee may be entitled.
(D) If the Employee s absence shall be occasioned by the actionable negligence
of a third party in respect of which damages are recoverable, then the Employee
shall:
notify the Company immediately of all the relevant circumstances and of any
claim compromise, settlement or judgement made or awarded in connection with it;
give to the Company such information concerning the above matters as the Company
may reasonably require; and
if the Company so requires, refund to the Company any amount received by him
from any such third party provided that the refund shall be no more than the
amount which he has recovered in respect of remuneration.
10. PENSION AND DEATH BENEFIT
(A) No provision of retirement or death in service benefits will be made by the
Company for the Employee, There is therefore no contracting-out certificate in
force under the Xxxxxxx Xxxxxxx Xxx 0000 in respect of the Employment.
11. RESTRICTIONS DURING THE EMPLOYMENT
(A) During the Employment the Employee shall not directly or indirectly:
be employed, engaged, concerned or interested in any other business or
undertaking or
engage in any activity which the Board reasonably considers may be, or become,
harmful to the interests of the Company or of any Group Company or which might
reasonably be considered to interfere with the performance of the Employee s
duties under this Agreement,
(B) Clause 11(A) shall not apply to the engagement of the Employee in any
Permitted Activity.
(C) The Employee shall comply with every rule of law and every regulation of the
Company for the time being in force in relation to dealings in shares or other
securities of the Company or any Group Company as shall be communicated to the
Employee from time to time.
12. CONFIDENTIAL INFORMATION AND COMPANY DOCUMENTS
(A) The Employee shall neither during the Employment (except in the proper
performance of his duties) nor at any time (without limit) after the termination
of the Employment except in compliance with an order of a competent court:
(i) divulge or communicate to any person, company, business entity or other
organisation any Confidential Information;
(ii) use any Confidential Information for his own purposes or for any purposes
other than those of the Company or any Group Company; or
(iii) through any failure to exercise due care and diligence, permit or cause
any unauthorised disclosure of any Confidential Information.
These restrictions shall cease to apply to any information which shall become
available to the public generally otherwise than through any breach by the
Employee of the provisions of this Agreement or other default of the Employee.
(B) The Employee acknowledges that all books, notes, memoranda, records, lists
of customers and suppliers and employees, correspondence, documents, computer
and other discs and tapes, data listings, codes, designs and drawings and other
documents and material whatsoever (whether made or created by the Employee or
otherwise) relating to the business of the Company or any Group Company (and any
copies of the same):
(i) shall be and remain the property of the Company or the relevant Group
Company; and
(ii) shall be handed over by the Employee to the Company or to the relevant
Group Company on demand and in any event on the termination of the Employment
and the Employee shall certify that all such property has been handed over on
request by the Board and agrees that he will take all reasonable steps to
prevent the disclosure of the same.
13. INVENTIONS AND OTHER INTELLECTUAL PROPERTY
(A) The parties foresee that the Employee may make inventions or create other
intellectual property in the course of his duties and agree that in this respect
the Employee has a special responsibility to further the interests of the
Company and the Group Companies.
(B) Any invention, improvement, design, process, information, copyright work,
trade xxxx or trade name or get-up made, created or discovered by the Employee
in the course of the Employment (whether capable of being patented or registered
or not and whether or not made or discovered in the course of the Employment) in
conjunction with or in any way affecting or relating to the business of the
Company or of any Group Company or capable of being used or adapted for use in
or in connection with such business ("Intellectual Property Rights") shall -be
disclosed immediately to the Company and shall (subject to Sections 39 to 43
Patents Act 1977) belong to and be the absolute property of the Company or such
Group Company as the Company may direct.
(C) If and whenever required so to do by the Company the Employee shall at the
expense of the Company or such Group Company as the Company may direct:
apply or join with the Company or such Group Company in applying for letters
patent or other protection or registration for an other Intellectual Property
Rights in the United Kingdom and in any other part of the world; and
execute all instruments and do all things necessary for vesting all such right,
title and interest in such letters patent or other Intellectual Property Rights
in the Company or such Group Company or such other person as the Company may
specify absolutely as sole beneficial owner.
(D) The Employee irrevocably and unconditionally waives all rights under Chapter
IV of Part 1 of the Copyright , Designs and Patents Xxx 0000 in connection with
his authorship Copyright of any existing or future copyright work in the course
of the Employment, in whatever part of the world such rights may be enforceable
including, without limitation:
(i) the right conferred by section 77 of that Act to be identified as the author
of any such work., and
(ii) the right conferred by section 80 of that Act not to have any such work
subjected to derogatory treatment.
(E) The Employee irrevocably appoints the Company to be his Attorney in his name
and on his behalf to execute any such instrument or do any such thing and
generally to use his name for the purpose of giving to the Company the full
benefits of this clause 13. A certificate in writing in favour of any third
party signed by any director or by the Secretary of the Company that any,
instrument or act falls within the authority conferred by this Agreement shall
be conclusive evidence that such is the case.
(F) Nothing in this clause 13 shall be construed as restricting the rights of
the Employee or the Company under sections 39 to 43 Patents Xxx 0000.
14. TERMINATION
(A) Notwithstanding any other provisions of this Agreement in any of the
following circumstances the Company may terminate the Employment immediately by
serving written notice on the Employee to that effect, In such event the
Employee shall not be entitled to any further payment from the Company except
such sums as shall have accrued due at that time. The circumstances are if the
Employee:
commits any serious breach of this Agreement or is guilty of any gross
misconduct or any wilful neglect in the discharge of his duties;
repeats or continues (after warning) any breach of this Agreement;
is guilty of any fraud, dishonesty or any conduct tending, to bring himself, the
Company, or any Group Company into disrepute;
shall commit any act of bankruptcy or shall take advantage of any statute for
the time being in force offering relief for insolvent debtors;
is convicted of any criminal offence (other than minor offences under the Road
Traffic Acts or the Road Safety Acts for which a fine or non-custodial penalty
is imposed) which might reasonably be thought to affect adversely the
performance of his duties;
refuses (without reasonable cause) to accept the novation by the Company of this
Agreement, or an offer of employment on terms no less favourable to him than the
terms of this Agreement, by any company which, as a result of a reorganisation,
amalgamation or reconstruction of the Company, acquires or agrees to acquire not
less than 90 per cent of the issued equity share capital of the Company (as
defined by section 744 of the Companies Act 1985); or
resigns as or otherwise ceases to be or becomes prohibited by law from being a
director of the Company, otherwise than at the Company s request.
Any delay by the Company in exercising such right of termination shall not
constitute a waiver of it.
(B) If at any time the Employee is unable to perform his duties properly because
of ill health, accident or otherwise for a period or periods totalling at least
90 working days in any period of 12 calendar months, or becomes incapable by
reason of mental disorder of managing and administering his property and
affairs, then the Company may terminate the Employment by giving him not less
than 1 months written notice to that effect provided that if at any time during
the currency of such a notice the Employee shall provide a medical certificate
satisfactory to the Board to the effect that he has fully recovered his physical
and/or mental health and that no recurrence of illness or incapacity can
reasonably be anticipated, the Company shall withdraw the notice unless, by that
date, a replacement for the Employee has been appointed.
(C) If the Company believes that it may be entitled to terminate the Employment
pursuant to clause 14(A) it shall be entitled (but without prejudice to its
right subsequently to terminate the Employment on the same or any other ground)
to suspend the Employee on full pay and other benefits for so long as it may
think fit.
(D) On the termination of the Employment or upon either the Company or the
Employee having served notice of such termination, the Employee shall:
(i) immediately deliver to the Company all materials, keys, credit cards,
motor-cars, and other property of or relating to the business of the Company or
of any Group Company which may be in his possession or under his power or
control;(ii) and the Employee irrevocably authorises the Company to appoint any
person in his name and on his behalf to sign any documents and do any things
necessary or requisite to give effect to his obligations under this clause
14(D).
(E) With a view to ensuring that his departure can be arranged with the minimum
of inconvenience or disruption to the business of the Group and its relationship
with third parties and its other employees, the Employee undertakes not, without
the prior approval of the Board as to the timing and manner of any communication
about his departure, to inform any of his colleagues about the proposed
cessation of his employment hereunder.
(F) The Employee acknowledges the right of the Company to monitor and control
the performance of its employees and acknowledges the fiduciary obligations
attaching to his position including obligations to inform the Board forthwith
upon his becoming aware that any of his colleagues engaged in the business of
any Group Company of which he is a director is intending or contemplating the
termination of his contract of employment with the Company of any other company
in the Group.
15. RESTRICTIVE COVENANTS
(A) The Employee will not without the written consent of the Board for a period
of 12 months (less any period during which the Employee has not been provided
with work pursuant to clause 3(D)) after the termination of the Employment
whether as principal or agent, and whether alone or jointly with, or as a
director, manager, partner, shareholder, employee or consultant of any other
person, directly or indirectly:
interfere with, tender for, canvass, solicit or endeavour to entice away from
the Company or from any Group Company the business of any person who at the date
of termination of the Employment or during the period of 1 year prior to that
date (or if earlier, prior to the date on which the Employee last carried out
duties assigned to him by the Company) was, to his knowledge, a customer, client
or agent of or supplier to or who had dealings with the Company or with any
Group Company and with whom he had personal dealings in the normal course of his
employment at that date or during that period. This restriction will be limited
to activities by the
Employee which will involve offering or providing services similar to those
which he will have provided during the Employment;
supply any product, carry out or undertake or provide any service similar to
those with which he was concerned to a material extent during the period of 6
months prior to the termination of the Employment to or for any person who, at
the date of termination of the Employment or during the period of 1 year prior
to that date was a customer, client or agent of or supplier to or was in the
habit of dealing with the Company or with any Group Company and with whom the
Employee had personal dealings in the normal course of his employment during
that period of 1 year;
be employed by, or enter into partnership with, employ or attempt to employ or
negotiate or arrange the employment or engagement by any other person, of any
person who to his knowledge was, at the date of the termination of the
Employment, or within 1 year prior to that date had been, an employee of the
Company or any Group Company and with whom he had personal dealings during that
period;
solicit, interfere with, tender for or endeavour to entice away from the Company
or from any Group Company any contract, project or business, or the renewal of
any of them, carried on by the Company or by any Group Company which is
currently in progress at the date of the termination of the Employment or which
was in the process of negotiation at that date and in respect of which the
Employee had contact with any customer, client or agent of or supplier to the
Company or any Group Company at any time during the period of 1 year prior to
the date of termination of the Employment.
(B) None of the restrictions contained in clause 15(A) shall prohibit any
activities by the Employee which are not in direct or indirect competition with
any business being carried on by the Company or by any Group Company at the date
of the termination of the Employment.
(C) At no time after the termination of the Employment shall the Employee
directly or indirectly represent himself as being interested in or employed by
or in any way connected with the Company or any Group Company, other than as a
former employee of the Company
(D) The Employee agrees that, having regard to all the circumstances, the
restrictions contained in this clause are reasonable and necessary for the
protection of the Company and the Group Companies and that they do not bear
harshly upon him and the parties agree that:
(i) each restriction shall be read and construed independently of the other
restrictions so that if one or more are found to be void or unenforceable as an
unreasonable restraint of trade or for any other reason the remaining
restrictions shall not be affected; and
(ii) if any restriction is found to be void but would be valid and enforceable
if some part of it were deleted, that restriction shall apply with such deletion
as may be necessary to make it valid and enforceable.
16. DISCIPLINARY AND GRIEVANCE PROCEDURES
(A) If the Employee wishes to obtain redress of any grievance relating to the
Employment or is dissatisfied with any reprimand, suspension or other
disciplinary step taken by the Company, he
may address this to the Chairman of the Company according to the Company s
published Disciplinary and Grievance Procedures.
17. NOTICES
A notice may be given by any party hereto to any other party hereto either
personally or by sending it by prepaid first class post or airmail to his
address stated in this Agreement or to any other address supplied by him to the
other par-ties hereto for the giving of notice to him. A properly addressed and
prepaid notice sent by post shall be deemed to have been served at an address
within the United Kingdom at the expiry of 72 hours after the notice is posted
and to have been served at an address outside the United Kingdom at the expiry
of 96 hours after the notice is posted.
18. FORMER CONTRACTS OF EMPLOYMENT
This Agreement shall be in substitution for any previous. contracts, whether by
way of letters of appointment, agreements or arrangements, whether written, oral
or implied, relating to the employment of the Employee (including all bonus and
option arrangements), which shall be deemed to have been terminated by mutual
consent as from the date of this Agreement and the Employee acknowledges to the
Company for itself and on behalf of each Group Company that he has no
outstanding claims of any kind against the Company or any Group Company in
respect of any such contract.
19. CHOICE, OF LAW AND SUBMISSION TO JURISDICTION
(A) This Agreement shall be governed by and interpreted in accordance with
English law.
(B) The parties submit to the exclusive jurisdiction of the English courts but
this Agreement may be enforced by the Company in any court of competent
jurisdiction.
20. GENERAL
(A) This Agreement constitutes the written statement of the terms of employment
of the Employee provided in compliance with Part 1 of the ERA.
(B) Save as otherwise herein provided there are no terms or conditions of
employment relating to hours of work or to normal working hours or to
entitlement to holiday (including public holidays) or holiday pay or to
incapacity for work due to sickness or injury or to pensions or pension schemes
or to requirements to work abroad and no collective agreement has any effect
upon the Employee s Employment under this Agreement.
SCHEDULE1
THE EMPLOYEE
Job title Chief Technical Officer
Basic Salary: GBP48000
Notice period 3 Months
Remuneration GBPHolidays 20 days, plus 1 day for every year served to a maximum
of 28 days
Sickness benefit 90 days per year
Hours of work 9.00am to 6.00pm, (with an hour break for lunch) Monday to Friday
inclusive
SHARE OPTIONS:
You will be entitled to purchase of share consideration for GBP15,000 of 144,750
at.20c each. 100,000 of these shares would be free tradable. The balance would
be tradable after 1 calendar year.
In addition, you will be offered 662,000 options at strike price of 20cents that
representing approximately 4% of the company s equity at time of your
employment.
The share options would have the following vesting and vesting restrictions:
After Year 1: 25%
After Year 2: 25%
After Year 3: 40%
After Year4: 10%
The above options expire on 30 September 2008.
As CTO you will be treated as an insider and subject to restrictions on resale
specifically that you can not sell except within specific "open" period and that
you can not sell more than 1% of total trading volume in any 90 days.
In the event of leaving for whatever reason you will forfeit any as yet unvested
shares. These options will be granted as part of an options plan that will be
registered with the SEC.
SCHEDULE 2
PERMITTED ACTIVITIES
1. The Employee is permitted to be engaged, concerned or interested in or to
hold office in any business or undertaking provided that:
(a) the business or undertaking in question does not compete with the business
of the Company or any Group Company;
(b) the Employee s engagement, concern or interest in the business or
undertaking in question does not require him to devote time and attention to it
such as to prevent the Employee from properly fulfilling his duties to the
Company or any Group Company, and in particular the Employee s duties under
clause 4 (A) of this Agreement; and
(c) the Employee notifies the Company in writing before or as soon as
practicable after his engagement, concern or interest arises begins.
EXECUTED as a DEED for
and on behalf of THE COMPANY by:
Director:
/s/ Xxxxx Xxxxx
Secretary:
Signed by the said
/s/ Xxxxx Xxxx
in the presence of:
