AIRLINE INTELLIGENCE SYSTEMS, INC.
Exhibit
10.1
AIRLINE
INTELLIGENCE SYSTEMS, INC.
January
1, 2006
Mr.
Xxxxxxx Xxxxxxxx
000-00
Xxxxxxxx Xxx.
Xxxxxxx
Xxxxxxx X0X 0X0
Dear
Xxxxx:
Re: Employment
Terms
This
letter agreement (the "Agreement") sets
out the employment terms for your employment with Airline Intelligence Systems,
Inc. (the "Company"), a corporation
incorporated pursuant to the laws of the State of Delaware. This Agreement will
set out additional benefits that you will receive and your obligations to the
Company.
1.
Duties
You
will hold the position of President and Chief Executive Officer of the Company.
The Company acknowledges that you will also be employed as the Corporate
Secretary of a Canadian wholly-owned subsidiary of the Company, Airline
Intelligence Systems Inc.. an Ontario company (the "Canadian Subsidiary"). You will report to the
Board of Directors of the Company and will devote sufficient time and attention
to performing the duties consistent with your position in the
Company.
2. Compensation
2.1 Salary.
The Canadian Subsidiary will pay you a salary ("Salary") for your services of
CDNS200.000 per fiscal year, less applicable Canadian withholding of taxes and
other mandatory deductions. The Salary will be bonic by the Company and the
Canadian Subsidiary in an allocation that is reasonable. You will be responsible
for all US federal and state withholding taxes and
deductions.
2.2 Business Expenses. You will be reimbursed for
normal business expenses which you reasonably incur in connection with your
duties as an employee of the Company in accordance with Company policies. You
will provide the Company with complete statements, receipts or vouchers to
support claims for reimbursement of your expenses prior to the receiving
reimbursement. Your expenses will be subject to review from time to time by the
Board of Directors of the Company.
2.3 Vacation. In each 12-month period during the
Term, you will be eligible for 4 weeks of paid vacation to be taken at such
times as may be acceptable to the Company.
If your
employment ends for any reason, you will not be entitled to receive any payment
for unused vacation unless provided by Company policies, or required by
applicable law.
-1-
2.4 Benefits. You will be entitled
to participate in the benefit plans of the Company.
3.
Term
3.1 Term. This Agreement will
commence as of January 1, 2006,
and will continue indefinitely unless terminated sooner in accordance
with the provisions of this section 3. You must provide at least
6 months' written notice
of termination to the Company. At any time after the receipt by the Company of
your notice of resignation the Company will be entitled to waive that notice,
and your employment will then be terminated immediately. Upon waiver of that
notice, you will receive your regular Salary for the remainder of the then
current term.
3.2 Termination upon Death. Your
employment will terminate upon your death.
3.3 Termination for Cause. The
Company may terminate your employment for cause without notice or further
obligation.
3.4 Termination Without Cause. The
Company is entitled to terminate your employment without cause by advising you
of its decision and by paying you a lump sum payment equal to the Salary that
the Company would have paid to you over a period of 18 months based on your
Salary at the date of termination. Subject to availability and in no event at
any cost to the Company above its regular premiums, you will receive a
continuation of health and dental benefits in Canada for the 18 month period
following your termination. All other benefits will immediately terminate on
your termination.
3.5 Result of Termination. If your
employment is terminated:
|
(a)
|
this
Agreement will be terminated, except for sections 4.2, 4.3, 4.4, 4.5, 4.6 and 4.7 and any other
provisions specifically contemplated to continue beyond the termination of
this Agreement;
|
|
(b)
|
you
will have no claim against the Company, its subsidiaries and their
respective officers, directors, employees, shareholders or agents for
damages or any other amounts arising out of or in respect of your
employment, except for payment of any compensation, benefits or expense
reimbursement owed to you pursuant to this Agreement on termination under
this Agreement. At the Company's request, you will reconfirm this
release in writing as a condition to receiving any payment under section
3.4;
|
|
(c)
|
you
will promptly return any property of the Company in your
possession.
|
-2-
4. Your
Obligations
4.1 General Obligations. During
the term of this Agreement, you will:
|
(a)
|
well
and faithfully serve the Company and carry out the duties assigned to you
to the best of your ability;
|
|
(b)
|
act
honestly and in good faith with a view to the best interests of the
Company;
|
|
(c)
|
comply
with all applicable policies of the Company as implemented and amended
from time to time;
|
|
(d)
|
not
improperly bring to the Company or use any trade secrets, confidential
information or other proprietary information of any third
party;
|
|
(e)
|
be
responsible for submitting all US federal and state taxes &
deductions;
|
|
(f)
|
not
knowingly infringe the intellectual property rights or other rights of any
third party in the performance of your duties;
and
|
|
(g)
|
by
entering into this Agreement you confirm that you are not subject to any
restrictions which might prevent you from being employed by, or carrying
out any of the duties of your position on behalf of, the
Company.
|
4.2 Confidentiality and Proprietary
Rights. You acknowledge and understand that the Company has expended
significant financial resources in developing its products, services,
intellectual property and confidential information. You agree to be bound by the
provisions of Schedule A attached. Your obligations under Schedule A are to
remain in effect following termination of this Agreement and/or your
employment.
4.3 Non-Competition. You
acknowledge that your services are unique and extraordinary. You also
acknowledge that your position will give you access to confidential information
of substantial importance to the Company and its business. Accordingly, during
the Non-Competition Period (as defined below), other than you being employed by
the Canadian Subsidiary, you will not either individually or in partnership or
jointly or in conjunction with any other person, entity or organization, as
principal, agent, consultant, lender, contractor, employer, employee, investor,
shareholder or in any other manner, directly or indirectly, advise, manage,
carry on, establish, control, engage in, invest in, offer financial assistance
or services to. or permit your name or any part thereof to be used by, any
business that competes, in any jurisdiction the Company operates or proposes to
operate in with the current and future business of the Company, its parent,
affiliated or subsidiary companies, or any planned business in which the
Company, its parent, affiliated or subsidiary companies is engaged
(collectively, the "Business").
Without limiting the generality of the foregoing, this provision
prohibits you from being involved in the solicitation or sale to any customers
of the Business of any products or services sold or provided by the Business.
"Non-Competition Period"
means the period during which you arc employed by the Company and a
period immediately thereafter equal to 24 months. The parties hereto agree that
if in any proceeding before a court of competent jurisdiction, the court shall
refuse to enforce the covenants set forth in section 4.3 because such covenants
cover too extensive a geographic area or too long a period of time, the Court is
expressly authorized to appropriately amend and modify the provision in keeping
with the intention of the parties to give this provision to the maximum scope
permitted by law.
-3-
4.4 Non-Solicitation. During the
applicable Non-Solicitation Period (as defined below), neither you nor any
entity with whom you are at the time associated, or affiliated will, directly or
indirectly, hire or offer to hire or entice away or in any other manner persuade
or attempt to persuade any officer, employee, agent, supplier or customer of the
Business to discontinue or alter any one of their or its relationship with the
Company. You will not assist or procure any other person or entity to do any act
that, if done by you, would constitute a violation of any of your obligations
above. "Non-Solicitation
Period" means the period during which you are employed by the Company and
a period immediately thereafter equal to 24 months.
4.5 Validity of Covenants. You
agree that (a) all provisions and restrictions in this Agreement are reasonable
and valid and (b) you waive all defences to the strict enforcement of this
Agreement.
4.6 Injunctive Relief. You agree
that the remedy at law for any breach by you of section 4.2, 4.3 or 4.4 of this
Agreement will be inadequate and that the Company will be entitled to temporary
and permanent injunctive relief against you without the necessity of proving
actual damage to the Company.
4.7 Company Breach No Excuse. You
agree that sections 4.2, 4.3 and 4.4 of this Agreement are enforceable against
you despite any breach or repudiation or alleged breach or repudiation of this
Agreement by the Company, even if the Company terminates you in a fashion that
does not comply with this Agreement or applicable law.
5.
Notice
Any
notice required or permitted to be given to you will be in writing and will be
sufficiently given if delivered to you personally or mailed by registered or
certified mail, postage prepaid, addressed to you at your address as shown on
the records of the Company. Any such notice which is mailed will be deemed to
have been received by you on the third business day following the date of
mailing.
6.
Entire Agreement,
Governing x.xx
This
Agreement is the entire agreement between you and the Company with respect to
this subject matter hereof and supersedes any and all prior agreements,
arrangements or understanding between the parties relating to the subject matter
hereof, except written agreements relating to stock option grants. The
provisions of this Agreement will be governed by and interpreted in accordance
with the laws of the State of Delaware.
7. Severability
The
provisions of this Agreement are severable and the invalidity or
unenforceability of any part will not affect the validity and enforceability of
the other parts. If any part is held to be unenforceable, it will be interpreted
in such a way as to affect most comprehensively
the intention of the parties. If any part is determined to be unenforceable, it
will not impair the validity of any other part and each part is separate and
distinct. The parties will co-operate to replace any severed term of this
Agreement with a replacement provision as close to the severed term as is
legally permissible.
-4-
--
8.
Acknowledgement
You
acknowledge that you have had sufficient time to review this Agreement, which
includes Schedule A, thoroughly and to obtain legal advice if desired. You
confirm that you have read and understand the terms of, and your obligations
under, this Agreement.
If this
Agreement is acceptable to you, please sign and return one copy to us. Upon
receipt by the Company of the fully executed copy, this Agreement will be
effective.
| AIRLINE INTELLIGENCE SYSTEMS, INC. | |||
|
|
By:
|
/s/ Xxxxxxx Xxxxxxxx | |
| Name: Xxxxxxx Xxxxxxxx | |||
| Title: Director | |||
| I agree to the terms of this Agreement. | ||
|
By:
|
/s/ Xxxxxxx Xxxxxxxx | |
| Xxxxxxx Xxxxxxxx | ||
-5-
SCHEDULE A
CONFIDENTIALITY
AND PROPRIETARY RIGHTS
AGREEMENT
1. Proprietary
Information
|
|
(a)
|
Your
employment creates a relationship of confidence and trust between theCompany
and you with respect to any information which may be made known to you
by the Company or by any client or customer of the Company, or learned
by you
in that context during the period of your employment and
which:
|
|
|
(i)
|
has
not been made generally available to the public;
and
|
|
|
(ii)
|
is
applicable or of value to the Company's current or anticipated business,
research
or development activities, or those of any client or customer of
the
Company.
|
|
|
(b)
|
All
that information has commercial value in the business in which the Company
is engaged and is referred to in this Agreement as "Proprietary
Information.'1
By way of illustration, but not limitation. Proprietary Information
includes: (i) any and all technical and non-technical information
including patent disclosures and applications, copyright applications,
trade secrets, confidential information, techniques, sketches, drawings,
models, inventions, know-how, processes, apparatus, equipment, algorithms,
software programs, software source documents, and formulae related to the
current, future and proposed products and services of the Company; (ii)
any and all information concerning research, experimental work,
development, design details and specifications, engineering, financial
information, procurement requirements, purchasing, manufacturing,
prospective and current customer lists and information, customer contracts
and services, business forecasts, cost and pricing information, sales and
marketing plans and information; and (iii) proprietary or confidential
information of any of the Company's customers or any other third party who
may disclose such information to the Company or to you in the course of
the Company's
business.
|
|
|
(c)
|
Proprietary
Information does not include any information: (i) which has been published
by others in a form generally available to the public; or (ii) which you
have received from a third party with the legal right to use that
information. Proprietary Information will not be deemed to have been
published merely because individual portions of the information have been
separately published, but only if all the material features comprising
such information have been published in combination. Proprietary
Information will not be considered to be publicly available, if it is made
public by you in violation of this Agreement or by a third party who has
no lawful right to hold or disclose the Proprietary Information or who
does so in violation of any contractual, legal, or fiduciary obligation to
the
Company.
|
-6-
2.
Ownership and Nondisclosure of Proprietary Information
All
Proprietary Information is the sole property of the Company, the Company's
assigns or the Company's customers, as the case may be, and the Company, the
Company's assigns or the Company's customers will be the sole and exclusive
owner of all patents, copyrights, mask works, trade secrets and other rights in
the Proprietary Information. You will not acquire any ownership or other
interest in the Proprietary Information. At all times, both during your
employment by the Company and after termination of such employment, you will
keep in confidence and trust all Proprietary Information, and you will not use
or disclose any Proprietary Information or anything directly relating to
Proprietary Information without the written consent of the Company, except and
only as may be necessary in the course of performing your duties as an employee
of the Company.
3.
Ownership and Return of Materials
All
materials (including, without limitation, documents, drawings, models,
apparatus, sketches, designs, lists, and all other tangible media of expression)
furnished to you by the Company will remain the property of the Company. Upon
termination of your employment, or at any time on the request of the Company
before termination, you will promptly (but no later than five days after the
earlier of your employment's termination or the Company's request) destroy or
deliver to the Company, at the Company's option: (a) all materials furnished to
you by the Company; (b) all tangible media of expression which are in your
possession and which include any Proprietary Information or otherwise relate to
the Company's business; and (c) written certification of your compliance with
your obligations under this sentence.
4.
Innovations
As used
in this Schedule A, the term "Innovations" means all
processes, machines, manufactures, compositions of matter, improvements,
inventions (whether or not protectable under patent laws), works of authorship,
information fixed in any tangible medium of expression (whether or not
protectable under copyright laws), moral right, mask works, trademarks, trade
names, trade dress, trade secrets, know-how, ideas (whether or not protectable
under trade secret laws), and all other subject matter protectable under patent,
copyright, moral right, mask work, trademark, trade secret or other laws, and
includes without limitation all new or useful art, combinations, discoveries,
formulae, manufacturing techniques, technical developments, discoveries,
artwork, software, and designs. Innovations includes "Inventions," which is defined
to mean any inventions or discoveries protectable under patent laws. It is also
understood that Innovations subject to copyright will be works made for
hire.
5.
Records
You will
keep complete, accurate and authentic notes, reference materials, data and
records of all Innovations in the manner and form requested in writing by the
Company of you or of its employees generally. All these materials will be
Proprietary Information upon their creation.
-7-
6.
Assignment of Innovations
You will
promptly disclose and describe to the Company and you will assign to the Company
or the Company's designee your entire right, title, and interest in and to, each
of the Innovations, and any associated intellectual property rights, which you
may solely or jointly conceive, reduce to practice, create, derive, develop or
make during the period of your employment with the Company, which either: (i)
relate, at the time of conception, reduction to practice, creation, derivation,
development, or making of such Innovation, to the Company's business or actual
or demonstrably anticipated research or development; or (ii) were developed on
any amount of the Company's time or with the use of any of the Company's
equipment, supplies, facilities or trade secret information; or (iii) resulted
from any work you performed for the Company. All such Innovations as described
in this paragraph are referred to in this Agreement as "Company
Innovations."
7.
Moral Rights
You
irrevocably waive all moral rights that you may have now or in the future with
respect to the Company Innovations, including, without limitation, any rights
you may have to have your name associated with the Company Innovation, any
rights you may have to prevent the alteration, translation or destruction of the
Company Innovations, and any rights you may have to control the use of the
Company Innovations in association with any product, service, cause or
institution. This waiver may be invoked by the Company, and by any of its
authorized agents or assignees, in respect of any of the Company
Innovations.
8.
Future Innovations
You
recognize that Innovations or Proprietary Information relating to your
activities while working for the Company and conceived, reduced to practice,
created, derived, developed, or made by you, alone or with others, within three
months after termination of your employment may have been conceived, reduced to
practice, created, derived, developed, or made, as applicable, in significant
part while employed by the Company. Accordingly, such Innovations and
Proprietary Information will be presumed to have been conceived, reduced to
practice, created, derived, developed, or made, as applicable, during your
employment with the Company and are to be promptly assigned to the Company
unless and until you have established the contrary by written evidence
satisfying the clear and convincing standard of proof.
9.
Cooperation in Perfecting Rights to Proprietary Information and
Innovations
|
|
(a)
You will perform, during and after your employment, all acts deemed
necessary or desirable by the Company to permit and assist the Company, at
the Company's expense, in obtaining and enforcing the full benefits,
enjoyment, rights and title throughout the world in the Proprietary
Information and Innovations. Such acts may include, but are not limited
to, execution of documents and assistance or co-operation: (i) in the
filing, prosecution, registration, and memorialization of assignment of
any applicable patents, copyrights, mask work, or other applications; (ii)
in the enforcement of any applicable patents, copyrights, mask work, moral
rights, trade secrets, other proprietary rights; and (iii) in other legal
proceedings related to the Proprietary Information or
Innovations.
|
-8-
|
|
(b)
If the Company is unable for any reason to secure your signature to any
document required to file, prosecute, register, or memorialize the
assignment of any patent, copyright, mask work or other applications or to
enforce any patent, copyright, mask work, moral right, trade secret or
other proprietary right under any Proprietary Information (including
improvements thereof) or any Innovations (including derivative works,
improvements, renewals, extensions, continuations, divisional,
continuations in part, continuing patent applications, reissues, and
reexaminations), you hereby irrevocably designate and appoint the Company
and the Company's duly authorized officers and agents as your attorney,
with full power of substitution, in your name but on behalf of and at the
expense of the Company: (i) to execute, file, prosecute, register and
memorialize the assignment of any such application; (ii)to execute and
file any documentation required for such enforcement; and (iii) to do all
other lawfully permitted acts to further the filing, prosecution,
registration, memorialization of assignment, issuance, and enforcement of
patents, copyrights, mask works, moral rights, trade secrets or other
rights under the Proprietary Information, or Innovations, all with the
same legal force and effect as if executed by you. Such appointment, being
coupled with an interest, is irrevocable by you and shall not be revoked
by your insolvency, bankruptcy, death or incapacity and you agree to
ratify and confirm all that the Company may do or cause to be done
pursuant to the foregoing.
|
10.
No Violation of Rights of Third Parties
Your
performance of all the terms of this Schedule and as an employee of the Company
does not and will not breach any agreement to keep in confidence proprietary
information, knowledge or data acquired by you prior to your employment with the
Company, and you will not disclose to the Company, or induce the Company to use,
any confidential or proprietary information or material belonging to any
previous employer or others. You arc not a party to any other agreement which
will interfere with your full compliance with this Agreement. You will not enter
into any agreement, whether written or oral, in conflict with the provisions of
this Schedule. In the course of my employment with the Company, you will not
knowingly violate or cause the Company to violate the intellectual property
rights of others.
11. Survival
This
Schedule: (a) shall survive your employment by the Company; (b) does not in any
way restrict your right or the right of the Company to terminate your employment
at any time, for any reason or for no reason; (c) enures to the benefit of
successors and assigns of the Company; and (d) is binding upon your heirs and
legal representatives.
12.
Injunctive Relief
A breach
of any of the promises or agreements contained herein will result in irreparable
and continuing damage to the Company for which there will be no adequate remedy
at law, and the Company is entitled to injunctive relief and/or a decree for
specific performance, and such other relief as may be proper (including monetary
damages if appropriate).
-9-
