Exhibit 10.3
ENGAGEMENT AGREEMENT
THIS AGREEMENT made as of January 1, 2002 (the effective date), by and
between ON Technology Geschaftsfuhrungs GmbH, a German corporation (the
"Company"), and Xx. Xxxxxx Xxxxxxxxx (the "VP EMEA Operations").
WHEREAS, the VP EMEA Operations has been a Sales Director of the
Company in the past, and the VP EMEA Operations and the Company now desire to
enter into a new relationship.
NOW THEREFORE, in consideration of the premises and the mutual
agreements hereinafter contained, and for good and valuable consideration the
parties agree as follows:
1. New Engagement. The prior relationship between the parties is
hereby terminated. The Company hereby re-engages the VP EMEA Operations as
Geschaftsfuhrer, and the VP EMEA Operations hereby accepts such engagement
by the Company, upon the terms and conditions hereinafter set forth.
2. Management Duties
2.1. The VP EMEA Operations shall be entitled and obliged to
represent the Company and to manage the business in accordance with
all applicable laws and statutory regulations, the articles of
incorporation, the rules of administration, if any, as well as the
provisions hereof, and shall be bound by shareholders' resolutions.
2.2. The VP EMEA Operations shall bear particular responsibility
for all operative activities in Europe, Australia, New Zealand, The
Middle East, Far East, and Africa.
2.3. The VP EMEA Operations shall in all situations obtain the
prior consent of the Company's Stockholders for matters exceeding the
day-to-day running of the business of the Company, including those
examples listed in Appendix A1 hereto.
2.3. The VP EMEA Operations shall report to the President of ON
Technology Corporation ("ON Technology"), a Delaware USA corporation
and the indirect parent of the Company.
2.5. The VP EMEA Operations shall execute his office with the
care and diligence of a prudent businessman and shall faithfully
perform the duties entrusted to him by law and contract. He shall be
obligated to serve and promote the business of the Company to the best
of his ability, for the purpose thereof he shall place at the
disposition of the Company all of his knowledge and ability as well as
his entire working capacity, and agrees not to accept or perform full
or part time employment or consulting services, or other "freelance"
activities for any other business or non-profit entity, unless
otherwise approved in writing by the Company's stockholders. The PC
shop, which is legally owned by the VP EMEA Operations, is approved by
the stockholders. The VP EMEA Operations may, however, render general
business advice to third parties without remuneration or in connection
with the VP EMEA Operations investment activities so long as such
activity does not; (a) constitute employment by another company, (b)
violate the VP EMEA Operations Non-Solicitation obligations set forth
in Section 9 herein; or (c) interfere with the VP EMEA Operations's
said full time and best efforts obligations to the Company.
3. Term. The VP EMEA Operations's term of engagement (the
"Engagement Period") under this agreement is open-ended.
4. Compensation. The Company agrees to pay the VP EMEA Operations as
follows in consideration for his services hereunder:
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4.1. Base Salary. Company hereby agrees to pay the VP EMEA
Operations an annual salary of one hundred sixty six thousand six
hundred sixty seven Euros ((euro) 166.667) per year beginning as of
the Effective Date (the "Base Salary") in accordance with Company's
present payroll policies.
4.2. Incentive Compensation. In addition, the VP EMEA Operations
will be eligible for an annual incentive bonus, payable under the
terms of the executive compensation plan of the ON Technology (such
plan described in Schedule 2 hereof), of one hundred sixty six
thousand six hundred sixty seven Euros ((euro) 166.667), at 100% of
achievement of objectives. The objectives for each year will be agreed
upon at the beginning of each year.
5. Other Benefits. The VP EMEA Operations shall also be entitled to
the following benefits of the Company.
5.1. Vacations. The VP EMEA Operations shall be entitled to 30
days' paid vacation time per year.
5.2. Additional Compensation and Benefits. The VP EMEA Operations
shall receive the following additional benefits; a leased company car
of his own choice up to a total leasing sum of (euro) 2000 net per
month during his employment with the Company. The VP EMEA Operations
may also use this vehicle for private purposes. Operating and
maintenance expenses will be paid by the company with the exception of
costs of gasoline used for vacation trips. The vehicle may only be
used by a third party upon prior approval of the Company. The VP EMEA
Operations is responsible for paying the tax imposed on the monetary
advantage of the private use of the vehicle Upon termination of this
Agreement for any reason, the VP EMEA shall return the company car to
the Company immediately upon the date of termination. For purposes of
clarification: (i) in the event this Agreement is terminated by the
Company pursuant to the provisions of Section 6.1(d), the VP EMEA
Operations shall be entitled to use the company car as described in
this Section 5.2 during the one hundred eighty day notice period
described in Section 6.1(d); and (ii) in the event this Agreement is
terminated by the VP EMEA Operations pursuant to the provisions of
Section 6.2(b), the VP EMEA Operations shall be entitled to use the
company car as described in this Section 5.2 during the one hundred
eighty day notice period described in Section 6.2(b), provided,
however, that the VP EMEA Operations shall be responsible for all
operating and maintenance expenses incurred during such 180-day
period.
The VP EMEA Operations will also be entitled to such additional
compensation and benefits as the Company may award from time to time
at its sole discretion.
5.3. Expenses. The VP EMEA Operations shall be entitled to
reimbursement, upon substantiation thereof in accordance with the
Company's standard procedure, for all reasonable expenses in the
ordinary course of business, and incurred by the VP EMEA Operations in
the furtherance of the Company's business.
5.4. Corporation Benefits. The VP EMEA Operations shall also
receive the benefits provided to an officer of ON Technology.
6. Termination. Termination may occur as follows:
6.1. By the Company. The Company may terminate the VP EMEA
Operations's engagement as follows:
(a) Without notice for "cause" as defined in 6.3 herein;
(b) Upon death of the VP EMEA Operations;
(c) Upon any disability that prevents the VP EMEA Operations
from rendering services to the Company consistent with his
duties for a period of six (6) consecutive months or more;
or
(d) Upon one hundred eighty (180) days advance notice without
"cause" and subject to any payment due under (S) 6.4 herein.
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6.2. By the VP EMEA Operations. The VP EMEA Operations may
terminate his engagement by the Company as follows:
(a) At any time following a material breach hereof that remains
uncured by the Company, and which the Company fails to cure
within thirty days after written notice; or
(b) Upon one hundred eighty (180) days advanced notice.
6.3. Cause. For the purposes of this Section "cause" means:
(a) Participating in any crime or similar offence involving
money or other property of the Company;
(b) Conviction of a felony;
(c) Continuing failure or refusal to perform directives,
consistent with the VP EMEA Operations's duties hereunder
after (i) notice that such failure will be deemed to
constitute cause for termination and (ii) a reasonable
opportunity to cure such failure or refusal;
(d) Failure to adhere to material written Company policies; or
(e) Knowing and Material violation of Section 7, 8 or 9 herein.
6.4. Payments Upon Termination. All forms of compensation payable
to the VP EMEA Operations will cease effective as of the date of any
termination under (S)(S) 6.1 (a) herein. However, the Company shall
pay the VP EMEA Operations the equivalent of six months worth of its
full compensation (defined as Base Salary, average Incentive
Compensation and Other Benefits) as severance pay in the event of
termination pursuant to (S) 6.1(c)-(d). In event of termination
pursuant to (S) 6.1 (b), the Company shall pay the VP EMEA Operations
the equivalent of six months worth of its full compensation (defined
as Base Salary, average Incentive Compensation and Other Benefits) as
severance pay, such severance pay being paid directly to the VP EMEA
Operations's Spouse or to the VP EMEA Operations's children, or their
legal Guardian, in the event that the VP EMEA Operations's Spouse does
not outlive him.
6.5. Return of Media. In the event of termination the VP EMEA
Operations shall deliver all Media (as defined for the purposes of
(S)7 herein) to the Company immediately, and shall destroy any
reproductions thereof not delivered to the Company.
6.6. Notice of termination of the VP EMEA Operations's
appointment as Geschaftsfuhrer shall be construed as notice of
termination of this Agreement to take effect at the earliest possible
time.
6.7. Survival of Obligations. The obligations of the VP EMEA
Operations under (S)(S)7, 8, 9 & 11 shall survive termination hereof.
7. Protection of Propriety Information.
7.1. For the purposes of this and the following section, the term
"Company" shall include the Company as previously defined, plus any
parent or subsidiary thereof. "Proprietary Information" is defined for
the purposes of this and the following section as any and all
information (in whole or in part) that the VP EMEA Operations will in
future make, conceive, reduce to practice, fix in tangible form, or
acquire while employed by the Company (either solely or jointly with
others), and that are within the scope of his engagement hereunder or
related thereto, or in which property rights have been assigned or
otherwise conveyed to the Company, which information has commercial
value in the Company's business, and is treated by the Company as
confidential (whether or not marked "Confidential" or "Proprietary").
The development and acquisition of the Proprietary Information are the
result of great effort and expense on the part of the Company and are
critical to the success and survival of the Company.
7.2. By way of illustration but not limitation, Proprietary
Information includes (a) trade secrets; (b) inventions, processes,
designs, including patents or patent applications thereon; (c)
confidential research or development information; (d) works of
authorship, including copyrights therefore; or (e) mask works.
Proprietary Information also includes data formulas, computer
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programs, documentation and software, know-how, improvements,
discoveries, developments, designs, algorithms, techniques,
strategies, new products, marketing plans, forecasts, unpublished
financial statements, contract forms, budgets, projections, licences
prices, costs, customer and supplier lists and employee rosters, and
any other information of a similar nature not available to the public,
whether oral or written, in drawings or in machine readable form.
7.3. "Intellectual Property Rights" is defined for the purposes
of this and the following section as all patent, copyright, trade
secret, and any other rights associated with the Proprietary
Information or the Inventions.
7.4. "Media" is defined for the purposes of this and the
following section as all documents, notes, drawings, specifications,
data, computer disks, cassettes, and any tangible medium of expression
pertaining to the VP EMEA Operations's work hereunder or containing
any Proprietary Information.
7.5. The VP EMEA Operations recognizes that his relationship with
the Company is one of high trust and confidence by reason to access to
and contact with the trade secrets and other confidential information
of the Company in technical and commercial matters, and also with
respect to such secrets and information of the Company's customers,
vendors and other parties to whom the Company may owe an obligation of
confidence. The VP EMEA Operations therefore agrees that the VP EMEA
Operations shall at all times during the VP EMEA Operations's
engagement and thereafter protect the Proprietary Information and
other confidential information of the Company or that belonging to
third parties who may have disclosed such information to the Company
under an obligation of confidentiality; not disclose to others or use
for the VP EMEA Operations own benefit or for the benefit of any
person other than the Company any Proprietary Information (whether or
not learned, obtained or developed solely by the VP EMEA Operations or
jointly with others).
7.6. The Company is a work-for-hire author for copyright law
purposes of all computer programs, databases ore other writings made
hereunder, and All Proprietary Information and the Intellectual
Property Rights are and shall remain the sole property of the Company.
But the Company may nonetheless request an assignment in lieu or as a
supplement of such rights. The VP EMEA Operations hereby assigns to
the Company, now and in advance, any Intellectual Property rights that
the VP EMEA Operations may have now or shall acquire later.
8. Inventions, etc.
8.1. "Inventions" shall mean all Proprietary Information made,
conceived, reduced to practice or learned by the VP EMEA Operations,
either alone or jointly with others, during the period that he is
employed by the Company, whether or not during normal working hours or
on Company premises, that is related to or useful in the business of
the Company and results from tasks assigned to him by the Company, or
from the use of premises or equipment owned, leased or contracted for
by the Company.
8.2. The VP EMEA Operations shall disclose promptly all
Inventions to the Company, or to any persons designated by it.
8.3. The VP EMEA Operations agrees that all Intellectual Property
Rights to the Inventions shall become the sole property of the
Company. The VP EMEA Operations hereby assigns to the Company any
rights that he may have or quire in the Inventions. The VP EMEA
Operations further agrees as to the Inventions to assist the Company
in every proper way, at the Company's expense, to secure or enforce
from time to time all Intellectual Property Rights in any and all
countries and jurisdictions. These services shall include, but not be
limited to, preparing and executing any and all documents needed to
secure or enforce the Intellectual Property Rights, together with any
assignments thereof, and the giving of testimony, in court or
otherwise, when needed. The VP EMEA Operations's obligation under this
section shall survive termination hereof, but the Company shall
compensate the VP EMEA Operations at a reasonable rate for all time
spent at the Company's request.
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8.4. In the event that the Company is unable, after
reasonable effort, to secure the VP EMEA Operations's signature
on any document needed to secure or enforce the Intellectual
Property Rights, whether because or physical or mental
incapacity, or any other reason, the VP EMEA Operations hereby
designates and appoints the Company and its duly authorized
officers and agents irrevocably as the VP EMEA Operations's
agents and attorneys-in-fact to act for and in the VP EMEA
Operations's behalf and stead, and to do all other lawfully
permitted act to further prosecution and issuance of the
Intellectual Property Rights with the same legal force and effect
as if executed by the VP EMEA Operations.
9. Non-Solicitation.
9.1. Until the later to occur of (1) the three-year
anniversary of the date hereof or (2) a period of twelve (12)
months following the termination, for any reason, of the VP EMEA
Operations's engagement by the Company, the VP EMEA Operations
will not, without the Company's prior written approval, directly
or indirectly:
(a) Recruit, solicit or knowingly induce, or attempt to
induce, any employee or consultant of the Company to
terminate his employment or consulting relationship
with, or otherwise cease his relationship with, the
Company; or
(b) Solicit, divert or take away, or attempt to do so, the
business or patronage of any clients, customers or
accounts, or prospective clients, customers or
accounts, of the Company (defined, for purposes
hereof, as any individual or entity whose business is
solicited by the Company, proposed to be solicited by
the Company, or who approaches the Company, with
respect to possibly becoming a client, costumer, or
account during the Engagement Period or Initial
Engagement Period).
9.2. If any restriction set forth in this Section is found
by any court of competent jurisdiction to be unenforceable
because it covers too long a period of time, too great a range of
activities, or too broad a geographic area, it shall be narrowed
to cover the maximum period of time, range of activities or
geographic areas that may be enforceable.
9.3. The VP EMEA Operations acknowledges that the
restrictions contained in this Section are necessary for the
protection of the business and goodwill of the Company and are
considered by the VP EMEA Operations to be reasonable for this
purpose. The VP EMEA Operations agrees that any breach of this
Section will cause the Company substantial and irrevocable damage
and, therefore, in the event of any such breach, in addition to
such other remedies which may be available, the Company will have
the right to seek specific performance and injunctive relief.
10. Former and Other Employment. The VP EMEA Operations represents that
his performance hereunder does not and will not breach any prior agreement with
or commitment to any third party to (i) keep proprietary information acquired by
him in confidence or trust, or (ii) refrain form competing, directly or
indirectly, with the business of such other party. The VP EMEA Operations
covenants that he shall not enter into any agreement, either written or oral
that conflicts herewith. The VP EMEA Operations represents, as part of the
consideration for this Agreement, that the VP EMEA Operations has not brought
and shall not bring to the Company any materials or documents of a former or
other employer or client that are not generally available to the public unless
he has first obtained express written authorization to do so.
11. Publicity; Use of Marks. The VP EMEA Operations shall not at any time
use the Company's name or any the Company trademark(s) or trade name(s) in any
advertising or publicity without the prior written consent of the company.
12. Miscellaneous.
12.1. Entire Agreement. This Agreement constitutes the
entire agreement between the parties with respect to the matters
herein, supersedes all prior understandings and agreements,
whether written or oral, and may not be amended or modified
except by any instrument in writing signed by both parties
hereto.
12.2. Successors and Assigns. This Agreement is binding upon
and inures to the benefit of both parties and their respective
successors and assigns, including any corporation with which or
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into which the Company may be merged or which may succeed to its
assets or business, although the obligations of the VP EMEA
Operations are personal and may be performed only by him.
12.3. Severability. If any provision hereof is held invalid,
illegal of unenforceable, that provision shall be construed so as
to most closely reflect the original intent of the parties, but
still be enforceable, and the remaining provisions shall continue
in full force and effect and shall not be affected or impaired
thereby.
12.4. Captions. Captions have been inserted herein solely
for convenience of references, and in no way define, limit or
affect the scope or substance of any provision hereof.
12.5. Notices. Any notice hereunder shall be in writing and
delivered by hand or sent by Federal Express, registered or
certified mail, postage prepaid, addressed as follows or to such
other address of which a given party may have given notice:
To the Company: ON Technology Geschaftsfuhrungs GmbH - ON
Technology Corp.
000 Xxxxxx Xxxxxx
Xxxxxxx, XX UAA 02451
Attn.: Xxxxxx Xxxxxxxxx, Director
With a Copy to: ON Technology's Legal Department
(Same address)
To the VP EMEA Xxxxxx Xxxxxxxxx
Operations Xxxxxxxx. 00
00000 Xxxxxxxxxxxx, Xxxxxxx.
12.6. Injunctive Relief. The VP EMEA Operations acknowledges
and agrees that the extent of damage to the Company in the event
of a breach by the VP EMEA Operations of any of the covenants
contained herein would be difficult or impossible to ascertain,
and that there would be no adequate remedy at law available to
the Company in the such event. The VP EMEA Operations agrees
therefore that the Company shall be entitled to enforce any or
all of the covenants contained herein by injunctive or other
equitable relief in addition to receiving damages or other relief
to which the Company may be entitled.
12.7. Liability. Because of the special German legal term in
this section the German text is the leading one.
(1) Die Gesellschaft ist verpflichtet, durch die
Gesellschafterversammlung jahrlich, spatestens zum Zeitpunkt der
Feststellung des Jahresabschlusses, einen Beschluss uber die
Entlastung des Geschaftsfuhrers fur die vorangegangene Tatigkeit
zu fassen.
The Company will, every year at the latest at the time of
accepting the annual accounts, through the annual shareholders
meeting or through a shareholder resolution, hold the
Geschaftsfuhrer harmless for his activities for the time period
covered by such resolution.
(2) Die Haftung des Geschaftsfuhrers gegenuber der Gesellschaft
ist auf vorsatzliches und xxxx fahrlassiges Verhalten beschrankt.
The liability of the Geschaftsfuhrer is limited to wilful
fraudulent or negligent behaviour and to acts of gross negligence
(3) Der Geschaftsfuhrer haftet gegenuber der Gesellschaft fur
alle Schaden nur bis zu einem Hochstbetrag von Euro 25.000. Diese
Beschrankung gilt nicht bei Schaden durch Vorsatz oder xxxxx
Fahrlassigkeit
The GF liability to the company for all damages is limited to a
maximum of Euro 25.000. This limitation shall not apply in the
event the damages are caused by the GF's wilful or fraudulent
acts or if caused by the GF's gross negligence.
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(4) Der Geschaftsfuhrer haftet gegenuber der Gesellschaft nicht,
sofern und soweit er auf ausdruckliche Weisung der Gesellschafter
tatig geworden ist.
The GF carries has no liability to the company in instances
arising from matters where he acted upon the instruction, written
or verbal, of the shareholders
12.8. Governing Law and Jurisdiction. This Agreement, and
all transactions hereunder shall be construed, interpreted and
enforced in accordance with the law and in the courts of the
Republic of Germany. The VP EMEA Operations agrees to submit to
the jurisdiction of the said courts for the purposes of suit
therein.
12.9. Liability Insurance and Indemnification. During the
term of this Agreement, ON Technology shall ensure that the VP
EMEA Operations shall be covered under ON Technology's Officer
and Director Errors and Omissions Insurance Policy. In addition,
ON Technology hereby confirms that during the VP EMEA Operations'
term as an officer of ON Technology, the VP EMEA Operations shall
be indemnified by ON Technology to the full extent permitted
under ON Technology's Certificate of Incorporation and By-Laws
and the General Corporate Law of the State of Delaware.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement, intending
the same to take effect as a sealed instrument, as of the date first written
above.
ON Technology Geschaftsfuhrungs GmbH VP EMEA Operations
By:_________________________________ _______________________________
Name: Ian Xxxx Xxxxxxx Xxxxxx Xxxxxxxxx
Title: Geschaftsfuhrer
ON Technology Geschaftsfuhrungs GmbH
By:_________________________________
Name: Xxxxxx Xxxxxxxxx
Title: Geschaftsfuhrer of
Xxxxx 96 Vermogensverwaltungs GmbH
as shareholder of
ON Technology Geschaftsfuhrungs GmbH
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Schedule 1 to Engagement Agreement
between ON Technology Geschaftsfuhrungs GmbH
and
Xxxxxx Xxxxxxxxx
The VP EMEA Operations shall in all situations obtain the prior consent of the
Company's stockholders for matters exceeding the day-to-day running of the
business of the Company including those examples listed Appendix A1 attached
hereto.
Schedule 2 to Engagement Agreement
between ON Technology Geschaftsfuhrungs GmbH
and
Xxxxxx Xxxxxxxxx
The ON Technology Corporation executive compensation plan (designated as "ON
Technology Corporation Fiscal Year 2001 commission plan is attached as Appendix
A2 attached hereto.
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Appendix A1
The follow matters shall be deemed to exceed the day-to-day business of the ON
Technology Europe GmbH % Co. KG and its related entities (the "Company"):
1. Adoption of a yearly budget;
2. Approval of any measures that exceeds the yearly budget;
3. Sale or lease of a substantial amount of the Company's assets;
4. Acquisition of a substantial amount of the assets or stock or another
company;
5. Entering into, altering or terminating a joint venture, partnership or
profit sharing agreement with another company;
6. Issuance of Company Stock;
7. Establishment of a new line of business of the Company or terminating
of substantially altering and existing one;
8. Signing, altering or terminating any licence agreement outside of the
ordinary course of business of the Company;
9. Purchase, sale or encumbrance of real estate of any value or of other
fixed asset that exceeds (euro) 100,000 in value;
10. Standing as a surety, giving a guarantee, accepting joint or several
liability for third parties, or granting pledge or other collateral
for third parties other than the discounting of bills of exchange in
the ordinary course of business of the Company;
11. Granting a loan or accepting deferred payment terms or taking out a
loan outside of the ordinary course of business or budget of the
company;
12. Waiver or subordination of any claim outside the ordinary course of
business or budget of the Company;
13. Hiring of personnel other than through the standard personnel policies
of the Company;
14. Giving pension promises
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Appendix A2
THIS SCHEDULE IS INTENTIALLY LEFT BLANK
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