EXHIBIT 10.3
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is dated as of the
16th day of May 2002. It is made and entered into by and between Borough
Corporation, a Corporation having offices located in Washington D.C. ("the
Company"), and, Xxxxx X. Xxxxxxx, Xx. a resident of the State of Connecticut,
USA (the "Employee").
R E C I T A L S:
A. The Employee has specialized skills, experience and knowledge in
administration, sales and business development particularly with startup and
early stage companies,
B. The Company is desirous of retaining Employee's services and Employee
is desirous of formalizing his relationship with the Company, and
C. The Company is willing to enter into an employment agreement with the
Employee to provide services for the Company, but only upon the terms and
condition provided for hereinafter,
NOW, THEREFORE, IN CONSIDERATION of the mutual promises made
herein and certain additional valuable consideration, as provided for
hereafter, it is
1. Services. Subject to the provisions of this Section 1 and Section 4
of this Agreement, the Employee shall serve as the Company's President and his
duties, responsibilities and accountabilities shall by incorporated into the
Company's Bylaws, as they shall be adopted from time to time by the Company's
shareholders or as otherwise described in Section 2 below. The Company agrees
to retain Employee to provide such services under the terms and
conditions set forth herein. Employee agrees to render all services
under this Agreement in a professional and business-like manner
and in full accordance with the terms and conditions of this
Agreement.
2. Employment Status. The Company and Employee agree that
Employee is an employee of the Company for every purpose. As
an employee of the Company, Employee shall be subject all
policies, rules and regulations established by the Company's
board of directors (the "Board"). The Employee shall also have
the opportunity to participate in all benefit programs established
by the Company and approved by the Board.
3. Control. The Board of Directors shall determine the means and
manner of performance of any services rendered pursuant to this
Agreement. In conformity with the status of the parties, the
Employee shall not hold itself out to have powers and authority
beyond the scope of those defined for the employee by the Board.
Employee shall have no right, power or authority to bind the
Company to any agreement, contract or other matter outside the
scope of authority established by the Board without the express
and prior written consent of the Board.
4. Compensation and Reimbursements.
a. Employee shall be paid at a monthly rate of $5,000.00,
payable in arrears.
b. The Company will reimburse Employee for Employee's actual,
reasonable expenses directly related to the performance of his
services hereunder, provided that Employee submits
appropriate supporting documentation. Employee shall
submit, not less frequently than monthly, a report on the
Company's standard expense report form detailing
Employee's reimbursable expenses together with supporting
documentation.
c. All travel arrangements must be consistent with the policies
and practices adopted by the Board.
5. Termination.
a. Termination Without Cause. Either party may terminate this
Agreement by giving the non-terminating party thirty (30) days prior written
notice.
b. Termination for Cause.
i. The parties agree that if either party shall violate
any provision of this Agreement, the Employee's
employment with the Company and all of his rights
may be terminated immediately for such cause at
the option of the non-breaching party. Notice of
termination shall be given via hand delivery or by
certified mail sent to the last known address of the
breaching party.
ii. The Company may terminate the Employee's
employment with the Company for "cause." The
term "Cause" shall mean any willful misconduct,
malfeasance, gross negligence or other like
conduct adversely affecting the best interests of the
Employer, including, without limitation, (A) the
failure or neglect by the Employee to perform his
duties hereunder, (B) the violation or attempted
violation of any provision hereof, (C) the
commission of any felony, including, without
limitation, any fraud against the Employer, any of
its affiliates, clients or customers of the Employer.
3. Confidentiality.
a. Employee acknowledges he will have access to operating,
financial and other information of Employer and customers of the Employer
including, without limitation, procedures, business strategies, and prospects
and opportunities, techniques, methods and information about, or received by
it, from its customers and that divulgence will irreparably harm the Employer
("Confidential Information"). Employee also acknowledges that the foregoing
provides Employer with a competitive advantage (or that could be used to the
disadvantage of the Employer by a competitor). Employee also acknowledges
the interest of the Employer in maintaining the confidentiality of such
information and Employee shall not, nor any person acting on behalf of
Employee, divulge, disclose or make known in any way or use for the
individual benefit of Employee or others any of such Confidential
Information. The foregoing is not applicable to such Confidential
Information that is established by Employee to be in the public domain
otherwise than as a result of its unauthorized disclosure by Employee or any
other person.
b. The customers of the Employer entrust the Employer with
responsibility for their business in the expectation that the Employer will
hold all such matters, including in some cases the fact that they are doing
business with the Employer and the specific transactions in which they are
engaged, in the strictest confidence ("Customer Confidences"). Employee
covenants that after the termination of his employment with the Employer,
he will hold all Customer Confidences in a fiduciary capacity and will not
directly or indirectly disclose or use such information.
c. Employee hereby assigns to the Employer his entire right, title
and interest in any idea, concept, technique, invention and related
documentation, other works of authorship, and the like (all hereinafter called
"Developments") made, conceived, written, or otherwise created solely by him
or jointly with others, whether or not such Developments are patentable,
subject to copyright protection or susceptible to any other form of protection
which relate to the actual business or research or development of the
Employer. Employee, after the termination of its employment with Employer,
shall return to the Employer (and shall not retain any copies or excerpts
therefrom) all documents, notes, analyses or compilations, including all
copies thereof, and all other property relating to the Employer ("Employer
Documents") including, but not limited to, documents generated by Employee
pursuant to his relation with the Employer.
d. Employee acknowledges that the Employer has a compelling
business interest in preventing unfair competition stemming from the use or
disclosure of Customer Confidences and Confidential Information in the event
that, after any termination on the post-employment activities of Employee,
Employee goes to work or becomes affiliated with a competitor of the
Employer.
e. Employee further acknowledges that all customers he services
or dealt with while employed with the Employer are customers of the
Employer and not Employee's personally. Employee also acknowledges that,
by virtue of his employment with the Employer, Employee has gained or will
gain knowledge of the identity, characteristics and preferences of the
customers of the Employer, and that Employee will not use such Customer
Confidences and Confidential Information at any time.
4. Covenants Not to Compete or Solicit.
a. The Employee undertakes that during the term of this
Agreement and for 24 months thereafter, he will not, directly or indirectly
(whether as sole proprietor, partner, stockholder, director, officer,
employee or in any other capacity as principal or agent) compete with, or
participate in any business that competes with, the Employer; provided that
the Employee may invest in (i) the securities of any business or enterprise
(but without otherwise participating in the activities of such business or
enterprise) which are listed on a national or regional securities exchange or
traded in the over-the-counter market, and (ii) equity interests of the
Employer, of any member thereof.
b. The Employee undertakes that during the term of this
Agreement and for a period of 24 months thereafter he will not, directly or
indirectly (whether as a sole proprietor, partner, stockholder, director,
officer, employee or in any other capacity as principal or agent), do any of
the following:
i. Hire, or attempt to hire for employment, any person
who is an employee of the Employer on the date of such termination of
employment, or attempt to influence any such person to terminate his
employment by the Employer; or
ii. In any other manner interfere with, disrupt or attempt
to disrupt the relationship, contractual or otherwise, between the Employer
and any of its employees, or disparage the business or reputation of the
Employer to any such person.
iii. The Employee undertakes that during the term of this
Agreement and for 24 months thereafter he will not, directly or indirectly
(whether as a sole proprietor, partner, stockholder, director, officer,
employee or in any other capacity as principal or agent), do any of the
following:
A. Solicit, service or accept any actual or prospective
accounts, clients or customers of the Employer during the
period of the Employee's employment by the Employer;
B. Influence or attempt to influence any of the
accounts, customers or clients referred to in Section 7.b.iii to
transfer their business or patronage from the Employer to any
other person or company engaged in a similar business;
C. Directly assist any person or company soliciting,
servicing or accepting any of the accounts, customers or clients
referred to in Subsection 7.b.iii; or
D. In any other manner directly interfere with, disrupt
or attempt to disrupt the relationship, contractual or otherwise,
between the Employer and any of its accounts, customers or
clients referred to in Subsection 7.b.iii, or any other person, or
disparage the business or reputation of the Employer to any
such person.
iv. The Employer undertakes that at all times, now or
hereafter, he will not, directly or indirectly, disparage the business or
reputation of the Employee to any accounts, customers or clients referred to
in this Section 7, or any other person.
5. Return of Documents. On termination of the Employee's
employment with the Company, or at any time upon the request of
the Board of Directors of the Company or its affiliates, the
Employee shall return to the Employer all documents, including
all copies thereof, and all other property relating to the business
or affairs of the Employer, including, without limitation, customer
lists, agents or representatives lists, commission schedules and
information manuals, letters, materials, reports, lists and records
(all such documents and other property being hereinafter referred
to collectively as the "Materials"), in his possession or control, no
matter from whom or in what manner he may have acquired such
property. The Employee acknowledges and agrees that all of the
Materials are property of the Employer and releases all claims of
right of ownership thereto.
6. Enforcement of Covenants. The parties acknowledge and agree
that the covenants contained in Sections 6, 7 and 8 are essential
elements of this Agreement and that, but for the agreements of the
Employee to comply with such covenants, the Employer would not
have entered into this Agreement. The parties further
acknowledge and agree that a breach by the Employee of the
covenants contained in Sections 6, 7 and 8 may result in
irreparable injury to the Employer for which there is no adequate
remedy at law and that the Employer shall be entitled to seek
enforcement of the same by means of a temporary restraining
order and/or a preliminary or permanent injunction issued by any
court having jurisdiction thereof. In the event that the Employee
breaches any of the covenants contained in Sections 6, 7 and 8,
the Employer shall be entitled to an accounting and repayment of
all profits, Commissions and benefits the Employee receives in
connection with such breach. The Employee agrees to indemnify
and hold harmless the Employer against all of its costs and
expenses (including, without limitation, reasonable attorneys fees
and expenses) incurred in connection with the enforcement of the
covenants contained in Sections 6, 7 and 8, except, with respect to
the enforcement of any such covenant by the Employer, to the
extent that the Employer is the prevailing party in any action or
proceeding commenced by the Employer in connection therewith.
The covenants contained in Sections 6, 7 and 8 shall survive the
termination of this Agreement. The remedies provided in this
Section 8 shall be in addition to, and not in lieu of, any other
remedies and relief including damages to which the Employer may
be entitled.
7. Blue-Pencil. If any court of competent jurisdiction shall at any
time deem the term of any of the covenants and undertakings of
the Employee under Sections 6, 7 and 8 herein too lengthy, the
other provisions of those Sections 6, 7 and 8 shall nevertheless
stand, the period of restriction shall be deemed to be the longest
period permissible by law under the circumstances. The court in
each case shall reduce the period of restriction to permissible
duration.
8. Mutual Indemnities. THE COMPANY AND EMPLOYEE JOINTLY AGREE
TO AND SHALL INDEMNIFY, DEFEND AND HOLD HARMLESS The OTHER FROM AND
AGAINST ANY AND ALL CLAIMS, LOSSES, DAMAGES, CAUSES OF ACTION, SUITS,
AND LIABILITY OF EVERY KIND,INCLUDING ALL EXPENSES OF LITIGATION, COURT
COSTS, AND ATTORNEYS' FEES, FOR INJURY TO OR DEATH OF ANY PERSON, OR
FOR DAMAGE TO ANY PROPERTY, ARISING OUT OF EITHER NEGLIGENCE OR
MISCONDUCT IN CONNECTION WITH THE WORK DONE BY EMPLOYEE UNDER THIS
AGREEMENT; PROVIDED THAT THIS INDEMNIFICATION SHALL NOT APPLY IN THE
EVENT OF ANY GROSS NEGLIGENCE OR WILLFUL MISCONDUCT BY THE EMPLOYEE.
9. Term. This Agreement shall expire, unless earlier terminated, on
May 16, 2004. It will automatically renew monthly until either
party gives notice not less than thirty (30) days of termination.
10. Assignment of Contract. Neither Employee nor the Company
shall assign their rights under this Agreement without the written
consent of the non-assigning party.
11. Governing Law. This Agreement, and the rights and obligations
of the parties hereto, shall be governed by and construed in
accordance with the laws of the State of Delaware without regard
to principles of conflict of laws.
12. Entire Agreement Amendment. This Agreement supersedes any
and all other agreements, either oral or written, between the
Company and Employee with respect to the subject matter hereof,
and contains all of the covenants and agreements between the
parties relating in any way to Employee's services for the
Company. The terms of this Agreement may not be modified or
amended except by an instrument in writing executed by each of
the parties hereto.
13. Notices. All notices or other communications required or
permitted hereunder shall be in writing. All notices or other
required or permitted communications shall be delivered or sent,
as the case may be, by any of the following methods: (i) personal
delivery, (ii) overnight commercial carrier, (iii) registered or
certified mail, postage prepaid, return receipt requested. Receipt
and effective delivery shall occur upon the earlier of the following.
(a) If personally delivered, the date of delivery to the address of
the person to receive such notice. (b) If delivered by overnight
commercial carrier, one day following the receipt of such
communication by such carrier from the sender as shown on the
sender's delivery invoice from such carrier. (c) If mailed, two (2)
business days after the date of posting by the United States post
office. No notice or other required or permitted communication
shall be effect unless and until received.
Any such notice or other communication so delivered shall be addressed to
the party to be served at the address set forth below:
The Company Employee
Borough Corporation Xxxxx X.
Xxxxxxx, Xx.
0000 X Xxxxxx XX 0 Xxxxx Xxx
Lane
Washington, D.C. 20009 Xxxxxx, XX
00000
Notice of change of address shall be given by written notice in the manner
detailed in this Section. Rejection or other refusal to accept or the
inability to deliver because of changed address for which no notice was given
shall be deemed to constitute receipt of the notice or communication sent.
14. Modifications and Waiver. No change or modification of this
Agreement shall be valid or binding upon the parties hereto unless
such change or modification shall be in writing and signed by the
Company and Employee. No course of dealing between the Company and
Employee, nor any waiver by the Company of a breach of any provision of
this Agreement, or delay in exercising any right under this Agreement,
shall operate or be construed as a waiver of any subsequent breach by
Employee.
15. Remedies for Breach. Employee recognizes and acknowledges
that the remedy at law for a breach by Employee of any of the
covenants contained in this Agreement shall be inadequate.
Employee agrees that the Company, in addition to all other legal
and equitable remedies it may have, shall have the right to
injunctive relief to enforce the provisions of this Agreement if
there is such a breach or threatened breach. The Company
hereby expressly reserves the right to offset any costs it incurs as a
result of any breach of this Agreement by Employee against any
amounts payable to Employee hereunder and the right to
terminate this Agreement upon written notice for a breach of this
Agreement by Employee. Both parties shall have all other rights
and remedies available at law or in equity for a breach or
threatened breach of this Agreement. Employee agrees that all
sums payable to it under this Agreement shall be available to the
Company to satisfy Employee's breach of this Agreement and to
satisfy Employee's indemnity agreement set forth in Section 7. If
any action at law or in equity is necessary to enforce or interpret
the terms of this Agreement, the prevailing party shall be entitled
to recover its reasonable costs and attorneys' fees from the other
party.
16. Removal of illegal, invalid or unenforceable provisions. If any
provision of this Agreement is held to be illegal, invalid or unenforceable,
such provision may be removed. Thereafter, the Agreement shall be
considered to be legal, valid or enforceable provision as though the removed
provision had never comprised a part of the Agreement. The remaining
provisions of this Agreement shall remain in full force and effect and
shall not be affected by the illegal, invalid or unenforceable provision
or by their removal from this Agreement.
17. No Partnership or Joint Venture. Nothing in this Agreement is
either intended and should not in any way be construed to create
any form of joint venture, partnership or agency relationship of
any kind between the Company and Employee. The parties
expressly disclaiming any intention of any kind to create any such
relationship between themselves.
18. Survival. Notwithstanding anything to the contrary contained in
this Agreement, the covenants in Sections 6, 7 and 8 shall survive
the termination of this Agreement and the Employee's employment
with the Company.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first set forth above.
Borough Corporation ("Company")
By: ___________________________
Name: ________________________
Title: _________________________
Xxxxx X. Xxxxxxx, Xx. ("EMPLOYEE"):
By: ___________________________
