EXHIBIT 10.9
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made and entered into as of January 1, 1997, by and
between OBJECT PRODUCTS, INC., a California corporation ("Employer"), and Xxx
Xxxxxxx, a California resident (hereinafter referred to as "Employee").
RECITALS
WHEREAS, LINC, Inc. and Employee are each signatories to that certain
Agreement and Plan of Merger dated January 1, 1997 (the "LINC Merger Agreement")
providing for, among other things, the merger of LINC, Inc., a California
corporation, with and into LINC Acquisition Corporation, Inc., a wholly-owned
subsidiary of Employer ("LAC"), and delivery of this Agreement by the parties
hereto;
WHEREAS, Employer desires to employ Employee, and Employee desires to be
employed by Employer, upon the terms and conditions set forth in this Employment
Agreement; and
WHEREAS, Employee acknowledges that she has had an opportunity to consult
with independent legal counsel of his choosing with regard to the terms of this
Agreement, and enters this agreement voluntarily and with a full understanding
of its terms;
NOW, THEREFORE, in consideration of the promises and the mutual covenants
hereinafter set forth and as additional consideration for each party's execution
and delivery of the Merger Agreement, Employer and Employee hereby agree as
follows:
1. Employment and Term. Employer agrees to employ Employee for a period
of thirty six (36) months commencing on January 1, 1997 and ending on December
31, 1999 unless terminated prior thereto in accordance with Section 5 hereof
(the "Employment Period"); provided, however, that if the Merger Agreement is
terminated for any reason, this Agreement shall be deemed to have been
terminated as of the date of such termination of the Merger Agreement. Each full
twelve (12) month period Employee is employed by Employer shall be referred to
herein as an "Employment Year."
2. Description of Position and Effort Required. As President and Chief
Executive Officer of LAC, Employee shall perform such duties and undertake such
responsibilities as are reasonably assigned to her by the Employer's Board of
Directors or its designated representative. Employee shall perform such duties
as are consistent with his assigned position and devote his full time and
attention, with undivided loyalty, to the business and affairs of Employer
during the Employment Period; provided, that the foregoing does not prohibit the
Employee from making investments or serving on the boards of directors of non-
profit entities, provided that such service or activities do not unreasonably
interfere with the performance of his duties with the Employer. Employee shall
not engage in any other business or job activity during the Employment Period
without Employees prior written consent. Employee shall in good faith perform
those duties and functions as are required by his position and as are determined
and assigned to her from time to time by the Board of Directors of Employer or
by their duly appointed representative or officer. Employee shall be required to
report to the Chief Executive
1.
Officer of Employer and the Employer's Board of Directors. Employee shall not be
required to relocate his present residence in order to perform his duties
hereunder. Employer shall not relocate LAC to a distance which would either
force Employee to relocate or require a commute of greater than twenty (20)
miles from Employee's current place of residence, without Employee's written
consent, for as long as Employee is directly involved with LAC.
As President and Chief Executive Officer of LAC, Employee shall be entitled
to full membership in the Presidents Council and shall in all cases be entitled
to compensation, powers and privileges associated therewith which are at least
equivalent to that received by any other member thereof.
3. Compensation. During the Employment Period, Employee shall receive
compensation from Employer for his services hereunder determined as follows:
(A) Base Salary. Employee during the Employment Period shall receive
a base salary (hereafter referred to as the "Base Salary") in the amount of One
Hundred Seventy Five Thousand Dollars ($ 175,000) per Employment Year, payable
no less frequently than monthly in accordance with Employer's usual payroll
practices.
(B) Bonuses. Employee shall be entitled to the incentives outlined in
Exhibit A. Employee incentives for Employment Year 1 shall be calculated from a
base consisting of the Net Revenues realized from of the exploitation of the
LINC software products during LINC's 1996 year. Employee incentives for
Employment Years 2 and 3 shall be calculated from a base of seventy five per
cent (75%) of the Net Revenues realized from the exploitation of the LINC
software products (as such products are upgraded or evolve from time to time) of
the prior Employment year. For the purposes of this incentive calculation and
this agreement Net Revenues shall be defined a invoiced sales, less credits
actually given, returns and uncollectable accounts written off as bad debts.
Employee shall be included in all stock option programs made available to
Employer's other executive employees in 1997. If LAC achieves annual service
revenue of $500,000 or more in Year 1, Employee shall be entitled to a cash
bonus of $20,000.
4. Benefits. During the Employment Period, Employer agrees to provide
Employee with the following benefits:
(A) Business Expense Reimbursement. Employee shall be authorized to
incur reasonable business expenses in performing his duties under this
Agreement, including, but not limited to, expenses for entertainment, long
distance telephone calls, lodging, meals, ordinary auto, auto insurance, health
club membership, air fare, transportation and travel. Employer will reimburse
Employee for all such reasonable expenses upon presentation by Employee, from
time to time, of an itemized account or other appropriate documentation of such
expenses as may be required by Employer.
(B) Vacation. Employee shall be entitled to accrue four (4) weeks of
paid vacation during each Employment Year I and 2 and five weeks of paid
vacation during Employment Year 3; provided, however, that Employer and Employee
must mutually agree as to the time during any Employment Year when such vacation
may be taken. Employee will be allowed to accrue a vacation bank per Employer
policy when issued. Employer anticipates the
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limit on this bank will be up to the amount Employee would accrue over a two (2)
year employment period.
(C) Additional Benefits. In addition to the foregoing, Employee will
be entitled to receive family health benefits equivalent to what the Employee
enjoyed previous to employment with Employer or, at Employee's option,
equivalent to that provided to any officer of Employer, a long-term disability
policy, a life insurance policy (equivalent to what the Employee enjoyed
previous to employment with Employer or, at Employee's option, equivalent to
that provided to any officer of Employer), a 401(k) plan and the benefits
provided to the other employees of Employer under established non-discriminating
employee benefit plans.
Employee will receive the use of a company car or a monthly car allowance
in the amount of four hundred fifty dollars ($450.00) paid at the beginning of
each calendar month.
5. Termination. Either Employer or Employee may terminate Employee's
employment by written notice given to the other party in accordance with the
following provisions:
(A) Termination by the Employer. The employment of Employee with
Employer may be terminated by Employer for cause or justification immediately
upon written notice to Employee, if any of the following events occur: (i)
Employee's conviction of or plea of nolo contendere to any felony charges
brought in any Court of competent jurisdiction; or (ii) following a
determination by the Board of Directors of the Company made in good faith that
Employee committed, engaged in or conspired to commit any crime involving fraud,
misrepresentation or gross misconduct against Employer which resulted, or if
successful, would have resulted in material harm to the Employer or substantial
pecuniary gain to Employee; (iii) as a result of nonperformance caused by the
Employee's material breach of this Agreement (including a good faith
determination by the Board that Employee is not performing in accordance with
Employee's job description); (iv) the Employee breaches a fiduciary duty owed to
the Employer which could reasonably be expected to materially adversely affect
the business, prospects or reputation of the Company or engages in acts of gross
misconduct or personal dishonesty toward the Employer; or (v) due to death.
Employer's total liability to Employee for termination (other than for statutory
liabilities) shall be limited to payment of Employee's Base Salary and Benefits
through the effective date of termination plus an additional 12 months of base
salary and benefits, and Employee shall not be entitled to any further
compensation or benefits provided under this Agreement, except as may be
required by law. If the alleged cause for termination is based upon Section
5(A)(iii), in addition to Employee receiving notice, Employee shall either have
been given a reasonable opportunity to take remedial action but failed or
refused to do so or an opportunity to take remedial action would not have been
reasonable or appropriate under the circumstances. If the alleged cause for
termination is based upon Sections 5(A)(ii) or 5(A)(iv), in addition to Employee
receiving notice, Employee shall be entitled to a full hearing before a quorum
of the Board of Directors prior to any termination of his Employment; provided
however, that if Employee is then a Director on the Board of Directors such
Employee shall not be entitled to vote at any such hearing or with respect to
any decision in connection with Employee's employment with Employer.
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In the event Employee's employment with Employer is terminated by Employer
for any other reason upon a majority vote of the Board of Directors or if
Employee's employment is terminated upon a good faith determination of the Board
that Employee had performed an act described in Sections 5(A)(ii) or 5A(A)(iii),
and such determination is subsequently held by a court of competent jurisdiction
to have been made in error, then Employer will pay the greater of Employee's
Base Salary and Benefits through the term of this agreement or twelve (12)
months of Base Salary and Benefits as calculated based on the Base Salary in the
Employment Year in which the termination or expiration of the Employee's
employment becomes effective, plus all benefits defined in Paragraph 4 above
-----
through the tam of Employee's severance. Employer's total liability to Employee
for such termination (other than statutory liability) shall be limited to
payment of the aforesaid amounts; provided, Employee shall not be under any duty
to mitigate damages in connection with the payment of the aforesaid amount.
(B) Termination by Employee. If Employee's employment with Employer
pursuant to this Agreement is terminated by Employee for any reason, Employee
shall be entitled only to his Base Salary and Benefits, including accrued
vacation, through the date of termination and shall not be entitled to any
further compensation or benefits pursuant to this Agreement, except as may be
required by law; provided, however, if Employee's employment with Employer
pursuant to this Agreement is terminated by Employee following a material breach
of this Agreement by Employer or constructive termination of Employee by
Employer (consisting only of a failure to pay as specified in Section 3 hereof
within 20 days of written notice by Employee that Employer is in breach of such
payment provision), such termination shall be treated as a termination pursuant
to the second paragraph of Section 5(A), and Employee shall be entitled to the
compensation set forth in such Section. Employee agrees to give Employer at
least ninety (90) days' prior written notice of his decision to terminate his
employment with Employer. Employer shall have the right in its sole discretion
to continue to employ Employee on a full or lesser than basis for ninety (90)
days, or for a shorter period with pay in lieu of notice to Employee in the
amount to which Employee would have been entitled to if employed for such ninety
(90) day notice period. During such ninety (90) day period, Employer shall not
be obligated to pay Employee if Employee accepts employment or becomes an
independent contractor or consultant of any other person, entity or corporation.
(C) Reimbursement of Expenses. In the event Employee is terminated
pursuant to either (A) or (B), above, Employee shall be entitled to
reimbursement for all standard and customary unreimbursed expenses incurred in
connection with Employee's service to Employer prior to the effectiveness of the
termination of Employee's employment.
6. Maintenance of Confidentiality and Duty of Loyalty. Employee
acknowledges that, pursuant to his employment with Employer, she will
necessarily have access to trade secrets and information that is confidential
and proprietary to Employer in connection with the performance of his duties on
behalf of Employer. In consideration for the disclosure to Employee of, and the
grant to Employee of access to, such valuable and confidential information and
in consideration of his employment, Employee shall comply in all respects with
the provisions of this Section 6.
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(A) Nondisclosure. During the Employment Period and thereafter,
Confidential Information of Employer and/or Parent of which Employee gains
knowledge before or during the Employment Period shall be used by Employee only
for the benefit of Employer and/or Parent in connection with Employee's
performance of his employment duties, and Employee shall not, and shall not
allow any other person that gains access to such information in any manner or
form, to disclose, communicate, divulge or otherwise make available, or use, any
such information without the prior written consent of Employer. For purposes of
this Agreement, the term "Confidential Information" means any information,
materials or documents not generally known to the public and which is
proprietary to Employer or Parent and relates to Employer's or Parent's existing
or reasonably foreseeable business or technology including trade secrets,
business plans, computer programs and/or code, advertising or public relations
strategies, customer information and lists, and information pertaining to
research, development, manufacturing, engineering, processing, product designs
(whether or not patented or patentable), purchasing and licensing, and may be
embodied in reports or other writings, in blue prints or in other tangible forms
such as equipment, models and/or schematics, drawings or diagrams. Employee will
refrain from any acts or omissions that would jeopardize or compromise the
confidentiality or reduce the value of any Employer and/or Parent Confidential
Information.
Employee understands that the Company has received and in the future will
receive from third parties confidential or proprietary information ("Third Party
Information") subject to a duty on the Company's part to maintain the
confidentiality of such information and to use it only for certain limited
purposes. During the Employment Period and thereafter, Employee will hold Third
Parry Information in the strictest confidence and will not disclose (to anyone
other than Company personnel who need to know such information in connection
with their work for the Company) or use, except in connection with my work for
the Company, Third Party Information unless expressly authorized by an officer
of the Company in writing.
Upon the termination of Employee's employment or upon the termination or
expiration of this Agreement, Employee agrees to return and not to retain any
originals, reproductions or copies of any materials or documents provided to
Employee or Employer.
(B) Covenant of Loyalty. During the Employment Period and for the
twelve (12) month period thereafter, or in the event of earlier termination, for
the twelve (12) month period following the date the termination of Employee's
employment becomes effective, Employee shall not, on his own account or as an
employee, agent, promoter, consultant, partner, officer, director, or
shareholder of any other person, firm, entity, partnership or corporation, own,
operate, lease, franchise, conduct, participate or engage in, be connected with,
have any interest in, or assist any person or entity engaged in any business,
corporation, division or other entity which derives a majority of its revenue
from the sale, development or distribution of healthcare information software
products designed or used for the healthcare industry or which are in direct
competition with Employer or LAC, including products in planning by management
and subject to or having received the approval of the Board of Directors of the
Employer. Nothing contained herein shall prevent Employee from purchasing an
interest in a mutual fund or other similar investment vehicle which may hold
interests in such companies, or from purchasing publicly traded shares of stock
in such companies, so long as Employee shall not own more than 10% of such
company's issued and outstanding common stock.
5
Direct competition means the development, promotion, serving as a
purchasing agent or being involved directly in the sale of products competitive
with those of Employer or LAC.
Without limiting the generality of the foregoing, Employee does hereby
covenant not to, during the Employment Period:
(i) solicit, accept or receive any compensation from any
customer of Employer or LAC or any business competitive to that of
Employer or LAC; or
(ii) contact, solicit or call upon any customer or supplier of
Employer or LAC on behalf of any person or entity other than Employer
or LAC for the purpose of selling, providing or performing any
services of the type normally provided or performed by Employer or
LAC; or
(iii) induce or attempt to induce any person or entity to
curtail or cancel any business or contracts which such person or
entity had with Employer or LAC; or
(iv) induce or attempt to induce any person or entity to
terminate, cancel or breach any contract which such person or entity
has with Employer or LAC, or receive or accept any benefits from such
termination, cancellation or breach.
(C) No Solicitation. During the Employment Period and for the twelve
month period thereafter, or in the event of earlier termination, for the twelve
(12) month period following the date the termination of Employee's employment
becomes effective, Employee agrees not to solicit, induce or attempt to solicit
or induce any employee of Employer to terminate such employee's employment with
Employer in order to become employed by any other person or entity, without the
consent of a majority of Employer's Board of Directors.
(D) Injunctive Relief. Employee expressly agrees that the covenants
set forth in this Section 6 are reasonable and necessary to protect Employer and
its legitimate business interests, and to prevent the unauthorized dissemination
of Confidential Information to competitors of Employer. Employee also agrees
that Employer will be irreparably harmed and that damages alone cannot
adequately compensate Employer if there is a violation of this Section 6 by
Employee, and that injunctive relief against Employee is essential for the
protection of Employer. Therefore, in the event of any such breach, it is agreed
that, in addition to any other remedies available, Employer shall be entitled as
a matter of right to injunctive relief in any court of competent jurisdiction,
plus attorneys' fees actually incurred for the securing of such relief.
Furthermore, Employee agrees that Employer shall not be required to post a bond
or other collateral security with the court if Employer seeks injunctive relief.
To the extent any provision of this Section 6 is deemed unenforceable by virtue
of its scope or limitation, Employee and Employer agree that the scope and
limitation provisions shall nevertheless be enforceable to the fullest extent
permissible under the laws and public policies applied in such jurisdiction
where enforcement is sought. In the event of a material breach by Employer of
its obligations to make payments under Sections 3 or 5 hereof (which is not
cured within five (5) days of notice of such breach), Employee's obligations
under this Section 6 shall terminate ten (10) days following
6
written notice (provided in accordance with Section 7 hereof) to Employer that
Employer is in breach of its obligation to make payments under such sections;
provided, however, that Employee's obligations under Section 6 shall not
terminate as a result of Employer's failure to pay under Section 5 hereof where
such failure to make payments follows a material breach of Employee's
obligations set forth in this Section 6.
(E) Recognition of Company's Rights. Employee agrees that any works
prepared or developed by Employee during the term of Employee's employment with
Employer are "works made for hire" and agrees to and hereby assigns, transfers
and conveys to Employer any rights now or potentially owned or held in
Proprietary Information. Employee acknowledges and agrees that all Proprietary
Information is the sole property of Employer. The term "Proprietary Information"
shall mean any and all trade secrets, confidential knowledge, data or other
proprietary information of Employee (including proprietary information held or
owned by Employee prior to Employee's employment with Employer provided such
proprietary information has been or is currently used in connection with the
business of the Employer or its predecessor). By way of illustration but not
limitation, "Proprietary Information" includes (a) inventions, mask works, trade
secrets, idea, processes, formulas, source and object codes, data, programs,
other works of authorship, cell lines, know-how, improvements, discoveries,
developments, designs and techniques; and (b) information regarding plans for
research, development, new products, marketing and selling, business plans,
budgets and unpublished financial statements, licenses, prices and costs,
suppliers and customers; and information regarding the skills and compensation
of employees. Employee agrees that all inventions which Employee makes,
conceives, reduces to practice or develops (in whole or in part, either alone or
jointly with others) during her employment shall be the sole property of
Employer to the maximum extent permitted by Section 2870 of the California Labor
Code (or other similar law of another state), a copy of which is attached and
hereby assign such inventions and all rights therein to Employer. No assignment
in this Agreement shall extend to inventions, the assignment of which is
prohibited by Labor Code section 2870 (or other similar law of another state).
The Company shall be the sole owner of all patents, copyrights and other
intellectual property or other rights in connection therewith.
(F) Compliance with Other Agreements. During the Employment Period
and any period Employee is being paid severance pay by Employer, Employee shall
comply with all terms and conditions of any employment, severance, separation or
other similar agreement with any prior employer of Employee. Employee represents
that her performance of all the terms of this Agreement will not breach any
agreement to keep in confidence proprietary information acquired by her in
confidence or in trust prior to Employee's employment by Employer. Employee has
not entered into, and agrees to not enter into, any agreement either written or
oral in conflict herewith or in conflict with Employee's employment with
Employer.
(G) Article 6 of the LINC Merger Agreement provides that, under
certain circumstances, Employee may purchase certain assets which were owned by
LINC, Inc. prior to the date of the LINC Merger Agreement, with the intention of
conducting business in a manner substantially similar to the business currently
conducted by LINC, Inc. In the event that Employee exercises her rights under
that Article, she shall not be deemed in breach of this Section 6 to the extent
that she conducts business in substantially the same markets and with
substantially the same products and services (as such products and services are
modified from
7
time to time during the course of this Agreement) as she conducted his (or LINC,
Inc.'s) business prior to entering into this Agreement.
7. Notices. Any notice which either party may wish or be required to give
to the other party pursuant to this Agreement shall be in writing and shall be
either personally served, deposited with a nationally recognized overnight
courier service or deposited in the United States mail, registered or certified
and with proper postage prepaid, addressed as follows:
To Employer. OBJECT PRODUCTS, INC.
000 Xxxxxxxx, Xxxxx 000
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxxx
To Employee: Xxx Xxxxxxx
c/o LAC
0000 Xxxxx Xxxx Xxxxxx
Xxxxxxxx, XX 00000-0000
or to such other address as the parties may designate from time to time by
written notice to the other party given in the above manner. Notice given by
personal service shall be deemed effective upon service. Notice given by
registered or certified mail shall be deemed effective three (3) days after
deposit in the mail.
8. Miscellaneous.
(A) Modifications. This Agreement supersedes all prior agreements and
understandings between the parties relating to the employment of Employee by
Employer, and it may not be changed, modified, amended or terminated orally. No
modification, termination, or attempted waiver of any other provisions of this
Agreement shall be valid unless in writing signed by the party against whom the
same is sought to be enforced.
(B) Enforceability and Severability. If any term of this agreement is
deemed void, voidable, invalid or unenforceable for any reason, such term shall
be deemed severable from all other terms of this Agreement, which shall continue
in full force and effect.
(C) Successors. This Agreement shall extend to and be binding upon
Employee, his legal representatives, heirs and distributees, and upon Employer,
its successors and assigns.
(D) Assignment. This Agreement shall not be assigned by either party
except in connection with (i) a merger of Employer with or into any other
corporation or corporations, or (ii) a sale, transfer or lease of all or
substantially all of the assets of this corporation.
(E) Governing Law. This Agreement and all remedies hereunder or shall
be construed and enforced in accordance with the laws of the State of
California.
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(F) Jurisdiction; Venue; Attorneys' Fees. In connection with any
action for relief pursuant to Section 6(D), the parties do hereby agree and
submit to personal jurisdiction in the State of California, County of San
Francisco, for the purposes of any proceedings brought to enforce or construe
the terms of this Agreement or to resolve any dispute or controversy arising
under, as a result of, or in connection with this Agreement, and do hereby agree
and stipulate that any such proceedings shall be venued and held in the Sate of
California, County of San Francisco. The prevailing party in any such proceeding
shall be entitled to recover from the losing party all costs that it has
incurred as a result of such proceeding including but not limited to all travel
costs and attorneys' fees.
(G) Counterparts. This Agreement may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.
(H) Effective Date/Term. This Agreement shall be effective as of the
date first above written.
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In Witness Whereof, the parties have caused this Agreement to be executed
effective as of the date first set forth above.
OBJECT PRODUCTS, INC.
By: /s/ Xxxxxxx X. Xxxx, III
------------------------------------
Xxxxxxx X. Xxxx, III
Secretary
EMPLOYEE:
By: /s/ Xxx Xxxxxxx
------------------------------------
Xxx Xxxxxxx
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EXHIBIT A
To Employment Agreement
Between
Object Products, Inc.
And
Xxx Xxxxxxx
January 1, 1997
Incentive Schedule
Based on the Incremental Sales of Existing Products
Net Revenue Incremental % Applied
Growth Against
Over Net Sales Increase over
Prior Year Prior Year Audited Sales
-------------------------------- ---------------------------
Sales Increase up to 20% 11.00%
Sales Increase greater than 20% 16.00%
Sales Increase greater tha 40% 20.00%
Calendar 1997 Example:
Net Percent Approximate
Revenues Increase Incentive
----------- ---------- ----------
Assume 100% of '96 Net Audited Revenues = $ 100,000 - $ -
Assume 1997 Net Audited Revenues = $ 100,500 5% $ 550
$ 110,000 10% $ 1,100
$ 115,000 15% $ 1,650
$ 120,000 20% $ 2,200
$ 125,000 25% $ 3,000
$ 130,000 30% $ 3,800
$ 135,000 35% $ 4,600
$ 140,000 40% $ 5,400
$ 145,000 45% $ 6,400
$ 150,000 50% $ 7,400
$ 155,000 55% $ 8,400
$ 160,000 60% $ 9,400
$ 165,000 65% $ 10,400
$ 170,000 70% $ 11,400
$ 175,000 75% $ 12,400
$ 180,000 80% $ 13,400
$ 185,000 85% $ 14,400
$ 190,000 90% $ 15,400
$ 195,000 95% $ 16,400
$ 200,000 100% $ 17,400
$ 205,000 105% $ 18,400
$ 210,000 110% $ 19,400
$ 215,000 115% $ 20,400
$ 220,000 120% $ 21,400
$ 225,000 125% $ 22,400
1
Calendar 1997 Example:
Net Percent Approximate
Revenues Increase Incentive
------------------- -------- -----------------
$ 230,000 130% $ 23,400
$ 235,000 135% $ 24,400
$ 240,000 140% $ 25,400
$ 245,000 145% $ 26,400
$ 250,000 150% $ 27,400
$ 255,000 155% $ 28,400
$ 260,000 160% $ 29,400
$ 265,000 165% $ 30,400
$ 270,000 170% $ 31,400
$ 275,000 175% $ 32,400
$ 280,000 180% $ 33,400
$ 285,000 185% $ 34,400
$ 290,000 190% $ 35,400
$ 295,000 195% $ 36,400
$ 300,000 200% $ 37,400
$ 305,000 205% $ 38,400
$ 310,000 210% $ 39,400
$ 315,000 215% $ 40,400
$ 320,000 220% $ 41,400
$ 325,000 225% $ 42,400
$ 330,000 230% $ 43,400
$ 335,000 235% $ 44,400
$ 340,000 240% $ 45,400
$ 345,000 245% $ 46,400
$ 350,000 250% $ 47,400
$ 355,000 255% $ 48,400
$ 360,000 260% $ 49,400
$ 365,000 265% $ 50,400
$ 370,000 270% $ 51,400
$ 375,000 275% $ 52,400
$ 380,000 280% $ 53,400
$ 385,000 285% $ 54,400
$ 390,000 290% $ 55,400
$ 395,000 295% $ 56,400
$ 400,000 300% $ 57,400
$ 405,000 305% $ 58,400
$ 410,000 310% $ 59,400
$ 415,000 315% $ 60,400
$ 420,000 320% $ 61,400
$ 425,000 325% $ 62,400
$ 430,000 330% $ 63,400
$ 435,000 335% $ 64,400
$ 440,000 340% $ 65,400
$ 445,000 345% $ 66,400
$ 450,000 350% $ 67,400
$ 455,000 355% $ 68,400
$ 460,000 360% $ 69,400
$ 465,000 365% $ 70,400
$ 470,000 370% $ 71,400
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Calendar 1997 Example:
Net Percent Approximate
Revenues Increase Incentive
------------------- -------- -----------------
$ 475,000 375% $ 72,400
$ 480,000 380% $ 73,400
$ 485,000 385% $ 74,400
$ 490,000 390% $ 75,400
$ 495,000 395% $ 76,400
$ 500,000 400% $ 77,400
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EXHIBIT A
To Employment Agreement
Between
Object Products, Inc.
And
Xxx Xxxxxxx
January 1, 1997
Incentive Schedule
Based on the Incremental Sales of Existing Products
Net Revenue Incremental % Applied
Growth Against
Over Net Sales Increase over
Prior Year Prior Year Audited Sales
----------------------------------- ------------------------
Sales Increase up to 20% 11.00%
Sales Increase greater than 20% 16.00%
Sales Increase greater than 40% 20.00%
Calendar 1998 Example:
Net Percent Approximate
Revenues Increase Incentive
------------------- -------- -----------------
Assume 75% of '97 Net Audited Revenues = $ 375,000 - $ -
Assume 1998 Net Audited Revenues = $ 393,750 5% $ 2,063
$ 412,500 10% $ 4,125
$ 431,250 15% $ 6,187
$ 450,000 20% $ 8,250
$ 468,750 25% $ 11,250
$ 487,500 30% $ 14,250
$ 506,250 35% $ 17,250
$ 525,000 40% $ 20,250
$ 543,750 45% $ 24,000
$ 562,500 50% $ 27,750
$ 581,250 55% $ 31,500
$ 600,000 60% $ 35,250
$ 618,750 65% $ 39,000
$ 637,500 70% $ 42,750
$ 656,250 75% $ 46,500
$ 675,000 80% $ 50,250
$ 693,750 85% $ 54,000
$ 712,500 90% $ 57,750
$ 731,250 95% $ 61,500
$ 750,000 100% $ 65,250
$ 768,750 105% $ 69,000
$ 787,500 110% $ 72,750
$ 806,250 115% $ 76,500
1
Calendar 1998 Example:
Net Percent Approximate
Revenues Increase Incentive
------------------- -------- -----------------
$ 825,000 120% $ 80,250
$ 843,750 125% $ 84,000
$ 862,500 130% $ 87,750
$ 881,250 135% $ 91,500
$ 900,000 140% $ 95,250
$ 918,750 145% $ 99,000
$ 937,500 150% $ 102,750
$ 956,250 155% $ 106,500
$ 975,000 160% $ 110,250
$ 993,750 165% $ 114,000
$ 1,012,500 170% $ 117,750
$ 1,031,250 175% $ 121,500
$ 1,050,000 190% $ 125,250
$ 1,068,750 185% $ 129,000
$ 1,087,500 190% $ 132,750
$ 1,106,250 195% $ 136,500
$ 1,125,000 200% $ 140,250
$ 1,143,750 205% $ 144,000
$ 1,162,500 210% $ 147,750
$ 1,181,250 215% $ 151,500
$ 1,200,000 220% $ 155,250
$ 1,218,750 225% $ 159,000
$ 1,237,500 230% $ 162,750
$ 1,256,250 235% $ 166,500
$ 1,275,000 240% $ 170,250
$ 1,293,750 245% $ 174,000
$ 1,312,500 250% $ 177,750
$ 1,331,250 253% $ 181,500
$ 1,350,000 260% $ 185,250
$ 1,368,750 265% $ 189,000
$ 1,387,500 270% $ 192,750
$ 1,406,250 275% $ 196,500
$ 1,425,000 280% $ 200,250
$ 1,443,750 285% $ 204,000
$ 1,462,500 290% $ 207,750
$ 1,481,250 295% $ 211,500
$ 1,500,000 300% $ 215,250
$ 1,518,750 305% $ 219,000
$ 1,537,500 310% $ 222,750
$ 1,556,250 315% $ 226,500
$ 1,575,000 320% $ 230,250
$ 1,593,750 325% $ 234,000
$ 1,612,500 330% $ 237,750
$ 1,631,250 335% $ 241,500
$ 1,650,000 340% $ 245,250
$ 1,668,750 345% $ 249,000
$ 1,687,500 350% $ 252,750
2
Calendar 1998 Example:
Net Percent Approximate
Revenues Increase Incentive
------------------- -------- -----------------
$ 1,706,250 355% $ 256,500
$ 1,725,000 360% $ 260,250
$ 1,743,750 365% $ 264,000
$ 1,762,500 370% $ 267,750
$ 1,781,250 375% $ 271,500
$ 1,800,000 380% $ 275,250
$ 1,818,750 385% $ 279,000
$ 1,837,500 390% $ 282,750
$ 1,856,250 395% $ 286,500
$ 1,875,000 400% $ 290,250
3
EXHIBIT A
To Employment Agreement
Between
Object Products, Inc.
And
Xxx Xxxxxxx
January 1, 1997
Incentive Schedule
Based on the Incremental Sales of Existing Products
Net Revenue Incremental % Applied
Growth Against
Over Net Sales Increase over
Prior Year Prior Year Audited Sales
----------------------------------- ------------------------
Sales Increase up to 20% 11.00%
Sales Increase greater than 20% 16.00%
Sales Increase greater than 40% 20.00%
Calendar 1999 Example:
Net Percent Approximate
Revenues Increase Incentive
------------------- -------- -----------------
Assume 75% of '98 Net Audited Revenues = $ 750,000 - $ -
Assume 1999 Net Audited Revenues = $ 787,550 5% $ 4,125
$ 825,000 10% $ 8,250
$ 862,500 15% $ 12,375
$ 900,000 20% $ 16,500
$ 937,500 25% $ 22,500
$ 975,000 30% $ 28,500
$ 1,012,500 35% $ 34,500
$ 1,050,000 40% $ 40,500
$ 1,087,500 45% $ 48,000
$ 1,125,000 50% $ 55,500
$ 1,162,500 55% $ 63,000
$ 1,200,000 60% $ 70,500
$ 1,237,500 65% $ 78,000
$ 1,275,000 70% $ 85,500
$ 1,312,500 75% $ 93,000
$ 1,350,000 80% $ 100,500
$ 1,387,500 85% $ 108,000
$ 1,425,000 90% $ 115,500
$ 1,462,500 95% $ 123,000
$ 1,500,000 100% $ 130,500
$ 1,537,500 105% $ 138,000
$ 1,575,000 110% $ 145,500
$ 1,612,500 115% $ 153,000
1.
Calendar 1999 Example:
Net Percent Approximate
Revenues Increase Incentive
------------------- -------- -----------------
$ 1,650,000 120% $ 160,500
$ 1,687,500 125% $ 168,000
$ 1,725,000 130% $ 175,500
$ 1,762,500 135% $ 183,000
$ 1,800,000 140% $ 190,500
$ 1,837,500 145% $ 198,000
$ 1,875,000 150% $ 205,500
$ 1,912,500 155% $ 213,000
$ 1,950,000 160% $ 220,500
$ 1,987,500 165% $ 228,000
$ 2,025,000 170% $ 235,500
$ 2,062,500 175% $ 243,000
$ 2,100,000 190% $ 250,500
$ 2,137,500 185% $ 258,000
$ 2,175,000 190% $ 265,500
$ 2,212,500 195% $ 273,000
$ 2,250,000 200% $ 280,500
$ 2,287,500 205% $ 288,000
$ 2,325,000 210% $ 295,500
$ 2,362,500 215% $ 303,000
$ 2,400,000 220% $ 310,500
$ 2,437,500 225% $ 318,000
$ 2,475,000 230% $ 325,500
$ 2,512,550 235% $ 333,000
$ 5,550,000 240% $ 340,500
$ 2,587,500 245% $ 348,000
$ 2,625,000 250% $ 355,500
$ 2,662,500 253% $ 363,000
$ 2,700,000 260% $ 370,500
$ 2,737,500 265% $ 378,000
$ 2,775,000 270% $ 385,500
$ 2,812,500 275% $ 393,000
$ 2,850,000 280% $ 400,500
$ 2,887,500 285% $ 408,000
$ 2,925,000 290% $ 415,500
$ 2,962,500 295% $ 423,000
$ 3,000,000 300% $ 430,500
$ 3,037,500 305% $ 438,000
$ 3,075,000 310% $ 445,500
$ 3,112,500 315% $ 453,000
$ 3,150,000 320% $ 460,500
$ 3,187,500 325% $ 468,000
$ 3,225,000 330% $ 475,500
$ 3,262,500 335% $ 483,000
$ 3,300,000 340% $ 490,500
$ 3,337,500 345% $ 498,000
$ 3,375,000 350% $ 505,500
2
Calendar 1999 Example:
Net Percent Approximate
Revenues Increase Incentive
------------------- -------- -----------------
$ 3,412,500 355% $ 513,000
$ 3,450,000 360% $ 520,500
$ 3,487,500 365% $ 528,000
$ 3,525,000 370% $ 535,500
$ 3,562,500 375% $ 543,000
$ 3,600,000 380% $ 550,500
$ 3,637,500 385% $ 558,000
$ 3,675,000 390% $ 565,500
$ 3,712,500 395% $ 573,000
$ 3,750,000 400% $ 580,500
3
EXHIBIT 10.9
EMPLOYMENT AGREEMENT
BETWEEN
OBJECT PRODUCTS, INC.
AND
XXX XXXXXXX
JANUARY 1, 1997
TABLE OF CONTENTS
Page
1. Employment and Term................................................................................... 1
2. Description of Position and Effort Required........................................................... 1
3. Compensation.......................................................................................... 2
(A) Base Salary.................................................................................. 2
(B) Bonuses...................................................................................... 2
4. Benefits.............................................................................................. 2
(A) Business Expense Reimbursement............................................................... 2
(B) Vacation..................................................................................... 2
(C) Additional Benefits.......................................................................... 3
5. Termination........................................................................................... 3
(A) Termination by the Employer.................................................................. 3
(B) Termination by Employee...................................................................... 4
(C) Reimbursement of Expenses.................................................................... 4
6. Maintenance of Confidentiality and Duty of Loyalty.................................................... 4
(A) Nondisclosure................................................................................ 5
(B) Covenant of Loyalty.......................................................................... 5
(C) No Solicitation.............................................................................. 6
(D) Injunctive Relief............................................................................ 6
(E) Recognition of Company's Rights.............................................................. 7
(F) Compliance with Other Agreements............................................................. 7
7. Notices............................................................................................... 8
8. Miscellaneous......................................................................................... 8
(A) Modifications................................................................................ 8
(B) Enforceable and Severability................................................................. 8
(C) Successors................................................................................... 8
(D) Assignment................................................................................... 8
(E) Governing Law................................................................................ 8
(F) Jurisdiction; Venue; Attorneys' Fees......................................................... 9
(G) Counterparts................................................................................. 9
(H) Effective Date/Term.......................................................................... 9
An extra section break has been inserted above this paragraph. Do not delete
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