EXECUTIVE EMPLOYMENT AGREEMENT
EXECUTIVE EMPLOYMENT AGREEMENT, effective this 1st day of February,
2002 ("Effective Date"), between ePHONE Telecom, Inc. (the "Company") and Xxxxx
Xxxxxxx (the "Executive") to be entitled, Executive Vice President and Chief
Operating Officer.
WITNESSETH
WHEREAS, the Company wishes to hire the Executive as an employee of the
Company to provide the services hereinafter set forth; and
WHEREAS, the Executive is willing to become an employee of the Company
upon the terms and conditions set forth herein.
NOW THEREFORE, in consideration of the promises and the mutual
agreements contained herein, intending to be legally bound, the parties agree as
follows:
1. DEFINITIONS
The following words and terms shall have the meanings set forth below
for the purposes of this Agreement:
1.1. Affiliates. "Affiliates" of the Company, or a person "affiliated"
with the Company, are any persons or entities which, directly or indirectly,
through one or more intermediaries, controls or are controlled by or are under
common control with, the persons or entities specified.
1.2. Base Salary. "Base Salary" shall have the meaning set forth in
Section 3.1 hereof.
1.3. Cause. Termination of the Executive's employment for "Cause" shall
mean: (a) failure of the Executive to perform assigned duties or to follow the
directives and polices set forth by the President and Chief Executive Officer or
Board of Directors; (b) conduct of the Executive, which, if proven, would
constitute a crime involving breach of professional ethics or moral turpitude or
a felony of any type; (c) conduct of the Executive which injures the business or
reputation of the Company; (d) conduct of the Executive which compromises the
Executive's ability to perform his job duties; (e) actions or omissions on the
part of the Executive that constitute a material breach of any provision of this
Agreement.
1.4. Change in Control of the Company. "Change in Control of the
Company" shall mean a change in control that is of a nature that would be
required to be reported in response to Item 6(e) of Schedule 14A of Regulation
14A promulgated under the Securities Exchange Act of 1934, as amended ("Exchange
Act"), or any successor thereto, whether or not the Company is registered under
the Exchange Act; provided that, without limitation, such a change in control
shall be deemed to have occurred if any person or entity other than the
Executive, the Company, or any of its Affiliates or associates, is or becomes
the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing fifty-one
percent (51%) or more of the combined voting power of the Company's then
outstanding securities.
1.5. Date of Termination. "Date of Termination" shall mean (i) if
the Executive's employment is terminated by reason of the Executive's death, the
date of the Executive's death, (ii) if the Executive's employment is terminated
for Cause or Disability, the date specified in the Notice of Termination, and
(iii) if the Executive's employment is terminated for any other reason, the date
on which a Notice of Termination is given or as specified in such Notice.
1.6. Disability. Termination of the Executive's employment based on
"Disability" shall mean termination of the Executive's employment because he is
unable to perform the essential functions of his position with or without
accommodation due to a disability (as such term is defined in the Americans with
Disabilities Act) for three (3) months in the aggregate during any twelve (12)
month period. This definition and this Section 1.6 shall be interpreted and
applied consistently with the Americans with Disabilities Act, the Family and
Medical Leave Act, and other applicable law.
1.7. Notice of Termination. With the exception of termination due to
the Executive's death, any purported termination of the Executive's employment
by the Company for any reason or by the Executive for any reason, shall be
communicated by a written "Notice of Termination" to the other party hereto. For
purposes of this Agreement, a "Notice of Termination" shall mean a dated notice
which (i) indicates the specific termination provision in this Agreement relied
upon, (ii) sets forth in reasonable detail the facts and circumstances claimed
to provide a basis for termination of Executive's employment under the provision
so indicated, (iii) specifies a Date of Termination, which shall be not less
than thirty (30) days after such Notice of Termination is given, except in the
case of the Company's termination of Executive's employment for Cause, for which
the Date of Termination may be the date of the notice; and (iv) is given in the
manner specified in Section 9.2 hereof.
1.8. Qualifying Termination. A "Qualifying Termination" shall mean a
termination of the Executive's employment by the Executive for any reason that
occurs on the effective date of a Change of Control of the Company or within six
(6) full calendar months following the effective date of a Change of Control of
the Company
2. EMPLOYMENT
2.1. Agreement and Term. The Company hereby employs the Executive and
the Executive hereby accepts said employment and agrees to render services to
the Company on the terms and conditions set forth in this Agreement. The term of
this Agreement shall commence on February 1, 2002, and shall continue from that
date until February 1, 2005 ("Expiration Date") unless terminated earlier by
either the Company or the Executive as hereinafter provided. If either the
Company or the Executive does not wish to renew this Agreement when it expires,
or if either the Company or the Executive wishes to renew this Agreement on
different terms than those contained herein, it or he shall give written notice
of such intent to the other party at least sixty (60) days prior to the
Expiration Date. In the absence of such notice, this Agreement shall be renewed
on the same terms and conditions contained herein for a term of one (1) year
from the Expiration Date. The parties expressly agree that designation of a term
and renewal provisions in this Agreement does not in any way limit the right of
the parties to terminate this Agreement at any time as hereinafter provided.
2.2. Duties. During the term of this Agreement, the Executive
shall devote his full working time and attention and use his best efforts to
further the interests of the Company. The Executive shall perform such
services
for the Company as is consistent with his position and as directed, from time to
time, by the Company. The Executive's initial title shall be Executive Vice
President and Chief Operating Officer. During the term of this Agreement the
Executive may use such titles as assigned and approved by the Company. The
Executive shall not, during the term of the Agreement, be employed or involved
in any other business activity, whether or not such activity is pursued for
gain, profit or other pecuniary advantage, except for volunteer services for or
on behalf of such religious, educational, non-profit and/or other charitable
organization as Executive may wish to serve.
3. COMPENSATION AND BENEFITS
3.1. Base Salary. The Company shall pay the Executive an initial base
salary of twelve thousand five hundred dollars ($12,500) per month (one hundred
and fifty thousand dollars ($150,000) per year) ("Base Salary") until the
Company's earnings before taxes, depreciation and amortization and excluding
acquisitions ("EBTDA"), as determined in accordance with generally accepted
accounting principles and consistent with the Company's past practices
("EBTDA"),
exceeds five hundred thousand dollars ($500,000) for the year 2002, at which
time the Company shall increase the Executive's Base Salary to one hundred
seventy five thousand dollars ($175,000) per year. Thereafter, the Company will
review the Executive's Base Salary on December 31 of each year of the term of
the Agreement.
3.2. Incentive Bonus. In addition to Base Salary, for the year ending
December 31, 2002, the Executive shall be eligible for the incentive bonus
described in Exhibit A, attached hereto and incorporated by reference as if
fully set forth herein. For each year thereafter, the Company shall establish
the criteria by which the Executive shall be eligible for an incentive bonus on
or before January 31st of each year of the term of the Agreement.
3.4. Stock Options. The Executive shall be eligible to participate in
any stock option plan established by the Board of Directors for Executives of
the Company in accordance with the terms of the Company's stock option plan and
the Executive's stock option agreement.
3.5. Withholding. All payments required to be made by the Company
hereunder to the Executive shall be subject to the withholding of such amounts,
if any, relating to tax and other payroll deductions as the Company may
reasonably determine should be withheld pursuant to any applicable law or
regulation.
3.6. Personnel Policies & Benefit Plans. Except as otherwise provided
herein, the Executive's employment shall be subject to the personnel policies
which apply generally to the Company's employees as the same may be interpreted,
adopted, revised or deleted from time to time, during the term of this
Agreement, by the Company in its sole discretion. During the term of the
Agreement, the Executive shall be entitled to participate in any Company benefit
plans on the same basis as other executive level employees of the Company. The
Company reserves the right to change, alter, or terminate benefits, plans and
carriers in its sole direction. All matters of eligibility for coverage or
benefits under any health, hospitalization, life, disability, or other insurance
plan, program or policy shall be determined in accordance with the provisions of
the plan, program, or policy; the Company shall not be liable to the Executive,
his/her family, heirs, executors, or beneficiaries, for any payment payable or
claimed to be payable under any such benefit plan, program, or policy.
4. SUPPORT AND EXPENSES
4.1. Office. The Company shall provide the Executive with secretarial
services and furnished offices in the Herndon, Virginia area, and in such other
location, if any, in which the Executive hereafter agrees to perform services on
behalf of the Company, all of which shall be consistent with the Executive's
duties and sufficient for the efficient performance of those duties.
4.2. Expenses. The Company shall reimburse the Executive or otherwise
provide for or pay for all pre-approved reasonable expenses incurred by
Executive in furtherance of, or in connection with the business of the Company,
subject to such reasonable documentation and other limitations as may be
established by the Board of Directors.
5. TERMINATION
5.1. Termination Due to Death. If the Executive's employment is
terminated by reason of the Executive's death, compensation pursuant to Section
3.1 of this Agreement shall expire effective the date of the Executive's death.
The entitlement of any beneficiary of the Executive to benefits under any
benefit plan shall be determined in accordance with the provisions of such plan.
5.2. Termination Due to Disability. The Company shall be entitled to
terminate the Executive's employment and this Agreement at any time due to the
Executive's Disability. If the Executive's employment is terminated due to
Disability, compensation pursuant to Section 3.1. of this Agreement shall
terminate effective the Date of Termination.
5.3. Termination by the Company for Cause. The Company shall be
entitled to terminate the Executive's employment and this Agreement at
any time for Cause. If the Executive's employment is terminated by the Company
for Cause,
compensation pursuant to Section 3.1. of this Agreement shall terminate
effective the Date of Termination. The entitlement of the Executive to benefits
under any benefit plan shall be determined in accordance with the provisions of
such plan.
5.4. Termination by the Company Other Than for Death, Disability, or
Cause. The Company shall be entitled to terminate the Executive's employment and
this Agreement at any time for any reason. If the Executive's employment is
terminated by the Company for reasons other than death, Disability, or Cause,
and if the Executive executes a general release with language acceptable to the
Company on or before the effective Date of Termination and complies with the
provisions of Section 5.8 of this Agreement, the Company shall pay the Executive
an amount equal to six (6) months of the Executive's Base Salary in a lump sum
payable within fifteen (15) business days following the effective date of such
release or as mutually agreed by the Company and Executive. The Company shall
not be required to pay any amount under this Section unless the Executive
executes a general release in a form acceptable to the Company and such release
becomes effective.
5.5Termination by the Executive. The Executive shall be entitled to
terminate his employment and this Agreement at any time for any reason. If the
Executive terminates his employment, compensation pursuant to Section 3.1 of
this Agreement shall expire as of the Date of Termination. The entitlement of
the Executive to benefits under any benefit plan shall be determined in
accordance with the provisions of such plan.
5.6. Qualifying Termination. The Executive shall be entitled to
terminate his employment and this Agreement for a Change in Control. In the
event of a Qualifying Termination, the Executive shall be entitled to the
benefits described in Section 5.4 of this Agreement.
5.7.Cooperation with Company After Termination of Employment. Following
termination of the Executive's employment for any reason, the Executive shall
fully cooperate with the Company in all matters relating to the winding up of
pending work on behalf of the Company including, but not limited to, any
litigation in which the Company is involved, and the orderly transfer of any
such pending work to other Executives of the Company as may be designated by the
Company.
5.8. Termination by Mutual Consent. Notwithstanding any of the
foregoing provisions of this Section 5, if at any time during the course of this
Agreement the parties by mutual consent decide to terminate it, they shall do so
by separate agreement setting forth the terms and conditions of such
termination.
6. NON-DISCLOSURE AND AUTHORIZATION TO DEDUCT PAY
6.1. The parties hereto have entered into a Non-Disclosure,
Non-Competition and Assignment Agreement (NDNCA), which is attached hereto as
Exhibit B, which may be amended by the parties from time to time. The provisions
of the NDNCA are intended by the parties to survive and do survive termination
or expiration of this Employment Agreement.
6.2. The Executive has also executed simultaneously with this
Agreement the Authorization to Deduct from Pay, which is attached hereto as
Exhibit C.
7. EXECUTIVE'S REPRESENTATIONS AND WARRANTIES
7.1. No Conflict of Interest. The Executive warrants that he is not, to
the best of his knowledge and belief, involved in any situation that might
create, or appear to create, a conflict of interest with loyalty to or duties
for the Company.
7.2. Notification of Materials or Documents from Other Employers. The
Executive further warrants that he has not brought and will not bring to the
Company or use in the performance of responsibilities at the Company any
materials or documents of a former employer that are not generally available to
the public, unless he has obtained express written authorization from the former
employer and the Company for their possession and use.
7.3. Notification of Other Post-Employment Obligations. The Executive
also understands that, as part of his employment with the Company, the Executive
is not to breach any obligation of confidentiality that he has to former
employers, and agrees to honor all such obligations to former employers during
employment with the Company. The Executive warrants that he is subject to no
employment agreement or restrictive covenant preventing full performance of
duties under this Agreement.
7.4. Indemnification For Breach. In addition to other remedies that the
Company might have for breach of this Agreement, the Executive agrees to
indemnify and hold the Company harmless from any breach of the provisions of
this Section 7.
8. ARBITRATION
8.1. Exclusive Remedy. The parties agree that any dispute between the
parties relating to the Executive's performance of his obligations herein or to
the termination of this Agreement, with the exception of Section, or the
Executive's employment, including, but not limited to, any claim arising out of
this Agreement, claims under Title VII of the Civil Rights Act of 1964, as
amended, the Civil Rights Act of 1991, the Age Discrimination in Employment Act
of 1967, the Americans With Disabilities Act of 1990, Section 1981 of the Civil
Rights Act of 1966, as amended, the Family Medical Leave Act, the Executive
Retirement Income Security Act, and any similar federal, state or local law,
statute, regulation, or any common law doctrine, whether that dispute arises
during or after employment with the exception of any dispute arising out of or
related to conduct defined in Section 1.3(b), Sections 6 and 8, shall be
resolved by arbitration in the Washington, DC metropolitan area, in accordance
with the National Employment Arbitration Rules of the American Arbitration
Association, as modified by the provisions of this Section 8. The parties each
further agree that the arbitration provisions of this Agreement shall provide
each party with its exclusive remedy, and each party expressly waives any right
it might have to seek redress in any other forum, except as otherwise expressly
provided in this Agreement.
8.2. Arbitrator's Authority. In reaching her/her decision, the
arbitrator shall have no authority to add to, detract from, or otherwise modify
any provision of this Agreement. The arbitrator shall submit with the award a
written opinion, which shall include findings of fact and conclusions of law.
Judgment upon the award rendered by the arbitrator may be entered in any court
having competent jurisdiction.
8.3. Effect of Arbitrator's Decision: Arbitrator's Fees. The decision
of the arbitrator shall be final and binding between the parties as to all
claims that were or could have been raised in connection with the dispute, to
the full extent permitted by law. In all cases in which applicable federal law
precludes a waiver of judicial remedies, the parties agree that the decision of
the arbitrator shall be a condition precedent to the institution or maintenance
of any legal, equitable, administrative, or other formal proceeding by the
Executive in connection with the dispute, and that the decision and opinion of
the arbitrator may be presented in any other forum on the merits of the dispute.
The arbitrator's fees and expenses and all administrative fees and expenses
associated with the filing of the arbitration shall be paid equally by the
parties.
8.4. Indemnification. In the event that either party breaches this
arbitration agreement and attempts to resolve in court claims covered by this
provision, they agree to indemnify the other party for all legal costs and
attorney's fees incurred to defend such action in court and to enforce the
provisions of the arbitration clause.
8.5. Continuing Nature of Agreement to Arbitrate. The parties
acknowledge and agree that their obligations under this arbitration agreement
survive the termination of this Agreement and continue after the termination of
the employment relationship between the Executive and the Company.
9. GENERAL PROVISIONS
9.1. Assignment. The Company may assign this Agreement and its rights
and obligations hereunder in whole, but not in part, to any Company or other
entity with or into which the Company may hereafter merge or consolidate or to
which the Company may transfer all or substantially all of its assets, if in any
such case said Company or other entity shall by operation of law or expressly in
writing assume all obligations of the Company hereunder as fully as if it had
been originally made a party hereto, but may not otherwise assign this Agreement
or its rights and obligations hereunder. The Executive may not assign or
transfer this Agreement or any rights or obligations hereunder.
9.2. Notice. For the purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by certified or
registered mail, return receipt requested, postage prepaid, if to the Company,
addressed to its corporate headquarters at the time notice is given, "Attention
Board of Directors"; if to the Executive, addressed to his home address as
listed in the Company's records at the time notice is given.
9.3. Amendment and Waiver. No provision of this Agreement may be
amended or waived unless (i) such amendment or waiver is in writing and signed
by each of the parties hereto.
9.4. Non-Waiver of Breach. No failure by either party to declare a
default due to any breach of any obligation under this Agreement by the other,
nor failure by either party to act quickly with regard thereto, shall be
considered to be a waiver of any such obligation, or of any future breach.
9.5. Severability. In the event that any provision or portion of this
Agreement, with the exception of Sections 2 and 3, shall be determined to be
invalid or unenforceable for any reason, the remaining provisions of this
Agreement shall be unaffected thereby and shall remain in full force and effect.
9.6. Governing Law. To the extent not preempted by Federal law, the
validity and effect of this Agreement and the rights and obligations of the
parties hereto shall be construed and determined accordance with the law of the
Commonwealth of Virginia.
9.7. Entire Agreement. This Agreement contains all of the terms agreed
upon by the Company and the Executive with respect to the subject matter hereof
and supersedes all prior agreements, arrangements and communications between the
parties dealing with such subject matter, whether oral or written.
9.8. Binding Effect. This Agreement shall be binding upon and shall
inure to the benefit of the transferees, successors and assigns of the Company,
including any Company or Company with which the Company may merge or
consolidate.
9.9. Headings. Numbers and titles to Sections hereof are for
information purposes only and, where inconsistent with the text, are to be
disregarded.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed on the date and year first written above.
The Company: ePHONE Telecom, Inc.
--------------------------
By:
Title:
The Executive:
--------------------------
Xxxxx Xxxxxxx
EXHIBIT A
INCENTIVE BONUS PLAN FOR 2001
The Executive shall be eligible for an incentive bonus for the calendar year
ending December 31, 2002 based on the Company's achievement of the following net
sales:
Net Sales: Incentive Bonus Amount
Between $ and $:
Between $ and $
Between $ and $
Over $
The amount of the Company's Net Sales shall be determined for the year ending
December 31, 2002 in accordance with generally accepted accounting principles
and consistent with the Company's past practices. For purposes of this Incentive
Bonus Plan, Net Sales shall be defined as Gross Sales Less Returns and shall not
include any amounts for sales derived by acquisitions. The Company in its sole
discretion shall determine the amount of Net Sales and such determination shall
be final, binding, and conclusive. The entire Incentive Bonus, if any, shall be
payable within thirty (30) days of the Company's receipt of its year-end audited
financial report. The Executive must be employed by the Company at the time the
Incentive Bonus is payable in order to be eligible for the Incentive Bonus.
In the event the Executive's employment is terminated pursuant to Section 5.1,
5.2, 5.4, 5.6 or 5.9 of this Agreement prior to the date the Incentive Bonus is
payable, the amount of the Incentive Bonus, if any, will be prorated for the
number of days that Executive was employed during the fiscal year.
EXHIBIT B
NON-DISCLOSURE, NON-COMPETITION AND ASSIGNMENT AGREEMENT
THIS AGREEMENT (the "Agreement") is entered into on this ______ day of
________________, 200__ by and between ___________________________________
("Employee"), and ________ Ltd. (the "Company").
This Agreement shall be effective as of the date of employment of a new
employee, or in the case of a current employee, on the date signed by the
employee ("Effective Date").
RECITALS
WHEREAS, Employee is, or is about to become, an employee of the Company, and
will have access to the Company's private and proprietary information;
WHEREAS, in order to protect the Company's proprietary information, in which the
Company has made a substantial investment, and to protect the Company from
unfair competition involving disclosure of that information, Employee has agreed
to enter into this Agreement;
NOW, THEREFORE, in consideration of continued employment, and other good and
valuable consideration, receipt of which is hereby acknowledged, Employee and
the Company, intending to be legally bound, agree as follows:
1. Proprietary Information. Employee acknowledges that Employee has or
will have access to confidential Company proprietary information,
including but not limited to, for example: the operating systems used
by the Company and maintenance thereof, information or data relating to
the creation, development, characteristics, implementation and
marketing of any Company product or service or business operation,
including without limitation methods of operation, product
capabilities, product design, details of contacts with customers,
consultants, suppliers or employees, customer lists, the identity of
customers and prospective customers, products, proposed products,
former products, costs, profit margins, business plans, strategies,
forecasts, unpublished financial information, budgets, projections, the
identity of employees and their expertise and salaries, designs,
drawings, Inventions (defined below), discoveries, improvements,
research or development, test results, specifications, formulas, data,
know-how, formats, copyrights, trade secrets, software, computer code
or files, marketing methods, patents and/or patent applications,
policies, plans, personnel, suppliers, competitors, markets or other
specialized information or proprietary matters relating to the business
of Company ("Proprietary Information"). Proprietary Information shall
be broadly defined. It includes all information that has or could have
commercial value or other utility in the business in which the Company
is engaged or in which it contemplates engaging. It also includes all
information of which the unauthorized disclosure is or could be
detrimental to the interests of the Company, whether or not such
information is identified as Proprietary Information by the Company.
A. Employee agrees to keep secret and retain in strictest
confidence all Proprietary Information. Employee shall not at
any time during or after employment, except with the express
prior written consent of the President, directly or indirectly
disclose, communicate or divulge any Proprietary Information
to any person, or use any Proprietary Information, for the
benefit of him/herself or any person other than the Company.
Employee agrees that this promise shall never expire.
B. Employee acknowledges that the Company would be severely
damaged if Employee used or disclosed Proprietary Information
for any purpose other than the Company's authorized business
purposes. To prevent Employee from breaking the promise not to
disclose this information, accidentally or intentionally,
Employee further agrees that, for a period of two years from
the termination of Employee's Company employment, Employee
will not accept any employment or engage in any activity,
without the Company's written consent, if the loyal and
complete fulfillment of Employee's duties would inherently
require Employee to reveal or utilize trade secrets or other
Company proprietary information which Employee has promised
not to disclose, as reasonably determined by Company. Employee
agrees to discuss such other employment or activities with the
President of the Company before undertaking them.
C. The restriction contained in paragraph 1.A shall not apply to
any Proprietary Information that (i) was known by the Employee
on or prior to the commencement of Employee's employment with
the Company, (ii) was developed by the Employee independently,
without the use of any Proprietary Information of Company, or
(iii) on or prior to the Effective Date, through no fault of
the Employee, becomes publicly known from another source that
is under no obligation of confidentiality to the Company.
Except as disclosed on Schedule 1 to this Agreement, Employee
does not know anything about the Company's Proprietary
Information, other than the information he or she has learned
from the Company. Employee has also disclosed on Schedule 1 a
complete list of all Inventions (defined below) proprietary to
Employee and which Employee wants to exclude from the
application of this Agreement. The Company agrees to receive
and hold all such disclosures in confidence.
D. Employee agrees not to remove any materials relating to the
work performed at the Company without the prior written
permission of the President of the Company. Employee agrees to
return all such material and/or Proprietary Information in
Employee's possession to the Company immediately upon request,
and in any event upon termination of employment. Employee
shall thereafter make no further use, either directly or
indirectly, of any such materials and/or Proprietary
Information.
E. All works prepared, created or furnished by Employee, or to
which Employee has contributed or contributes during the term
of his or her engagement by the Company, are and shall
constitute "works made for hire" within the meaning of the
United States Copyright Law, and
accordingly, all present and future right, title and interest
in and to all such works throughout the world, in any and all
media now known or hereafter developed, including but not
limited to all copyrights (and all renewals and extensions
thereof), shall vest in and belong solely to Company.
F. If any of the works described in Paragraph E or any of
Employee's contribution(s) thereto shall not, for any reason,
at any time, qualify as "works made for hire," Employee hereby
irrevocably assigns and conveys to the Company all present and
future right, title and interest in and to all such works,
throughout the world, in any and all media now known or
hereafter developed, including but not limited to all
copyrights therein (and all renewals and extensions thereof)
along with all causes of action, including those for
infringement, known or unknown, which have accrued or will
accrue, from the conception or creation of each such work.
G. Without limiting the scope of the foregoing, Employee hereby
assigns, transfers and conveys to the Company all right, title
and interest throughout the world, in any and all media now
known or hereafter developed, in and to all information,
concepts, matter or material which Employee conceives,
creates, develops or contributes to, including but not limited
to any and all ideas, designs, inventions and/or patentable
matter created or conceived by Employee during his or her
engagement by Company, along with all causes of action, known
or unknown, which have accrued or will accrue, from the
conception or creation of any or all of the foregoing.
H. Employee further agrees to disclose to the Company in writing,
within 30 days of discovery, development or production, any
and all inventions, discoveries, developments, improvements,
designs, processes, techniques, know-how, data, works of
authorship or other tangible work product, and original
materials, whether or not patentable or registerable under
copyright or similar statutes, made, conceived, reduced to
practice, or learned by Employee (either alone or jointly with
others) during the period of his or her employment, that are
related to or useful in the business of the Company, or which
result from or are related to tasks assigned to Employee by
the Company or the use of premises, equipment or materials
owned, leased, or otherwise acquired or used by the Company
(all of the foregoing are referred to herein as "Inventions").
Employee acknowledges and agrees that all Inventions belong to
and shall be the sole property of the Company and shall be
Inventions of the Company subject to the provisions of this
Agreement. Employee irrevocably assigns to the Company all
right, title, and interest Employee may have or may acquire in
and to all Inventions, including, without limitation,
copyright, trademark, trade secret, patent, and work rights,
along with all causes of action, known or unknown, which have
accrued or will accrue, from the conception or creation of any
or all of the foregoing. Employee acknowledges and agrees that
no rights relating to any Invention are reserved to Employee.
I. Employee agrees to sign and deliver to the Company (either
during or after his or her employment) such other documents as
the Company considers desirable to evidence or effect the
assignment of all rights of Employee, if any, in any
Inventions to the Company and the Company's ownership of such
Inventions. In the event the Company is unable to secure
Employee's signature on any document necessary to apply for,
prosecute, obtain, or enforce any patent, copyright, or other
right or protection relating to any Invention, whether due to
mental incapacity or any other cause, Employee hereby
irrevocably designates and appoints the Company and each of
its duly authorized officers and agents as his or her agent
and attorney-in-fact, to act for and in his behalf and stead
to execute and file any such documents and to do all other
lawfully permitted acts to further the prosecution, issuance,
and enforcement of patents, copyrights, or other rights or
protections with the same force and effect as if executed and
delivered by the Employee.
J. Employee will not disclose to the Company, or use, or induce
the Company to use, any proprietary information or trade
secrets of others. Employee represents and warrants that he or
she has returned all property and confidential information
belonging to others, and that all works prepared, created or
furnished by Employee, or to which Employee has contributed or
contributes during the term of his or her engagement by
Company, have been and shall be original and do not and shall
not infringe or violate the rights of any other person or
entity under any laws, including but not limited to any
copyright, trademark, trade secret and/or patent laws,
anywhere in the world.
K. Employee shall indemnify, defend and hold the Company, its
employees, officers, directors, agents, representatives,
licensees and customers (including, without limitation, other
staff members of Company) harmless from and against any and
all losses, costs, expenses and fees (including reasonable
attorneys' fees) arising from or in connection with any direct
or third-party claim(s), action(s) or proceeding(s) which
arise in connection with a knowing, intentional act by the
Employee which results in an actual or threatened breach of
Employee's warranties, representations or covenants set forth
herein. Without in any way limiting the foregoing, it is
expressly understood and agreed that Company shall have the
right, but not the obligation, to retain counsel of its own
choice in connection with any such third-party claim(s),
action(s) or proceeding(s).
2. Covenant Not to Solicit Employees. Employee agrees not to solicit for
employment (or to assist with such solicitation), or to hire (including
employment as a full-time or part-time employee or as a consultant) any
employee or former employee of the Company, for a six-month period
after the termination of Employee's employment with the Company. The
restrictions set forth in this paragraph apply to the solicitation or
hiring of any person who is, or within the six months before the
termination of Employee's employment, was an employee or consultant of
the Company.
3. Covenant Not to Solicit Customers. Employee agrees not to solicit (or
to assist with such solicitation) any customer or client of the Company
to forego purchasing the Company's products or services and/or switch
to another company's products or services, for a one year period after
the termination of Employee's employment with the Company. For the
purpose of this paragraph, the terms "customer" and "client" include
any person, private entity or governmental entity (or employee or agent
thereof), within or outside the United States of America, with whom the
Company does or has done business, to whom the Company's products or
services have been provided or sold, whom the Company has solicited for
funds, and/or to whom the Company is making, has made, or plans or has
planned to make business contacts or sales calls, within the one year
before the termination of Employee's employment, and with whom the
Employee has had direct or indirect contact or whose business Employee
has worked on or supervised.
4. Covenant Not to Compete. During the term of the Employee's Company
employment, the Employee shall not engage in any way, directly or
indirectly, in any activities or business in competition with or any
way detrimental or adverse to the Company, its business, or its
operations. Employee agrees that for six months after the termination
of Employee's Company employment, Employee (including any entity
controlled by Employee, and any agent or employee of Employee) shall
not compete with the Company, or, directly or indirectly, own, manage
or control, or participate in the ownership, management, or control of
any corporation, partnership, proprietorship, firm, association or
other business entity which competes with the Company, without first
obtaining the prior written consent of the President of the Company.
Expiration of the six month period herein shall in no way limit or
abridge any proprietary or other rights which the Company may have in
law or in equity.
5. Injunctive Relief. Employee expressly agrees and understands that any
breach by Employee of this Agreement will result in irreparable harm to
the Company, and that the damages flowing from such breach cannot be
adequately measured in monetary terms. Employee further expressly
acknowledges that the remedy at law for any breach by Employee of this
Agreement will be inadequate. Accordingly, it is agreed that the
Company shall be entitled, among other remedies, to immediate
injunctive relief, including a temporary restraining order, preliminary
injunction and permanent injunction for any such breach or threatened
breach. In addition to this injunctive relief, a breach of any covenant
of Employee contained herein shall also give rise to such monetary
damages as are available in law or equity.
6. No Hardship on Employee. Employee has carefully considered the nature
and extent of the restrictions upon him or her and the rights and
remedies conferred upon the Company under this Agreement, and hereby
acknowledges and agrees that the same are reasonable in time and
territory, are designed to eliminate unfair business practices that
otherwise would be unfair to Company, are fully required to protect the
legitimate interests of the Company and do not confer a benefit upon
the Company disproportionate to the detriment imposed upon Employee.
7. Prior Commitments. Employee has no other agreements, relationships, or
commitments to any other person or entity that conflict with Employee's
obligations to the Company under this Agreement.
8. Severable Provisions. The provisions of this Agreement are severable,
and if any one or more provisions may be determined to be illegal or
otherwise unenforceable, in whole or in part, the remaining provisions
or parts thereof shall nevertheless be binding and enforceable.
In the event that any provision of this Agreement is deemed
unenforceable, the Company and Employee agree that a court of competent
jurisdiction shall reform such provision to the extent necessary to
cause it to be enforceable to the maximum extent permitted by law. The
Company agrees that they desire the court to reform such provision, and
therefore agree that the court will have jurisdiction to do so and that
they will abide by what the court determines.
9. Assignment. Employee's duties under this Agreement shall not be
assignable or delegable by Employee without the prior written consent
of the Company.
10. Binding Agreement. The rights and obligations of the Company and
Employee under this Agreement shall inure to the benefit of and shall
be binding upon the successors and assigns of the Company, and to the
extent legally permissible, to and upon the heirs, legal
representatives and assigns of Employee.
11. Waiver. Any party's failure to enforce any provision or provisions of
this Agreement shall not in any way be construed as a waiver of any
such provision, nor prevent that party thereafter from enforcing any
provision of this Agreement. The rights granted the parties herein are
cumulative and the waiver by a party of any single remedy shall not
constitute a waiver of such party's right to assert any other legal
remedies.
12. Governing Law. This Agreement is made in Virginia and shall be governed
and construed according to the laws of the Commonwealth of Virginia.
13. Entire Agreement. This Agreement constitutes the sole and entire
agreement of the parties with respect to the subject matter hereof,
supersedes all prior understandings and agreements relating to the
subject matter hereof and may not be modified except in writing, signed
by all parties.
14. Attorneys' Fees. In the event either party hereto finds it
necessary to employ legal counsel or to bring an action at law or other
proceeding against the other party to enforce any of the terms,
covenants or conditions hereof, the party prevailing in any such action
or other proceeding shall be paid all reasonable attorneys' fees by the
other party as well as costs.
15. Consideration. Employee acknowledges that he or she has not been
promised, and shall not claim, any additional or special payment not
set forth specifically herein, for compliance with the covenants and
agreements contained herein.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement. Employee
acknowledges that he or she has read and understands this Agreement.
Witnessed by: EMPLOYEE:
--------------------------------- ------------------------------
-------------------------------- -----------------------------
(Print Full Name) (Print Full Name)
COMPANY
By:
---------------------------
Schedule 1
Prior Knowledge of Company's Proprietary Information
Excluded Inventions
EXHIBIT C
TO: ePhone Telecom, Inc.
0000 Xxxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxxx 00000
RE: Authorization to Deduct from Pay
The undersigned, Xxxxx Xxxxxxx (Employee), hereby confirms that:
1) That he has accepted a position as an employee of ePhone Telecom, Inc.
("ePhone"); and
2) Employee acknowledges that during the course of his employment ePhone
will provide him with the equipment and other tools necessary to
perform his duties, including, but not limited to, computing equipment,
cell phone, pager, credit or calling cards (the "Business Tools"), all
of which are and shall remain the sole and exclusive property of
ePhone, notwithstanding that Employee may be responsible for the
settling of all balances with any third party vendors who provided
services for any of the Business Tools;
3) Employee acknowledges and agrees that he shall return any and all
Business Tools and repay any outstanding balances due on any accounts
associated with the Business Tools, upon termination of employment with
ePhone, regardless of the circumstances of such termination.
4) In the event that Employee fails to return any or all of the Business
Tools or to satisfy any associated accounts as of the effective date of
his termination, ePhone shall be entitled, and Employee hereby
expressly authorizes ePhone, to withhold from and offset against
Employee's pay, including regular pay, vacation pay, bonuses, severance
pay or other compensation, any amounts due ePhone from Employee. For
the purposes hereof, the value of equipment not returned by Employee
shall be calculated based on its book value as consistently applied by
ePhone to its other business equipment. ePhone shall be entitled to use
such funds to pay the outstanding balances of any credit or other
accounts for which ePhone is a guarantor or otherwise ultimately
liable, even if such accounts are not overdue as of the Employee's
termination date.
5) Nothing contained herein shall be deemed to be a waiver of ePhone's
rights to pursue Employee for any balance owing to ePhone for Business
Tools after application of all wages or other payments due Employee on
termination.
This authorization is made in favor of ePhone this ____ day of _________, 20___
by:
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Employee Signature
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Printed Name
