Exhibit 10.13
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is entered into effective
June 13, 2001 (the "Effective Date"), by and between Xxx Xxxxxxxxxx (the
"Employee"), and USOL Holdings, Inc., an Oregon corporation (the "Employer").
RECITALS:
A. Employer desires to employ Employee as Interim Chief Executive Officer
for a period of 90 days; and
B. Employee desires to accept such employment on the terms and conditions
herein set forth;
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants herein contained and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, Employer and Employee
hereby agree as follows:
ARTICLE I
AGREEMENT
1.01 Employment. Subject to the terms and conditions of this Agreement, Employer
agrees to employ Employee as Interim Chief Executive Officer, and Employee
hereby accepts such employment with Employer.
1.02 Term and Renewal. The term (the "Term") of Employee's employment shall
commence on June 13, 2001 (the "Effective Date") and shall continue thereafter
for 90 days from the Effective Date, unless earlier terminated as provided
herein or unless extended pursuant to the written agreement of Employee and
Employer.
ARTICLE II
TITLE, AUTHORITY AND DUTIES
2.01 General. Employee agrees to act as Interim Chief Executive Officer of
Employer. Employee shall render such services as are normally delegated to such
office and such other additional services as may be delegated to him from time
to time by the Board of Directors (herein so called) of Employer. Attached as
Exhibit A is a list of objectives of the Board of Directors which Employee
agrees to pursue. In performing such duties, Employee shall give Employer the
benefit of his special knowledge, skills, contacts and business experience and
shall devote all of his business time, attention, ability and energy exclusively
to the business of Employer. Employee shall report to the Employer's Board of
Directors. Subject to the representations contained in Article VIII, it is
agreed that Employee may have other business investments that may, from time to
time, require minor portions of his time, but that shall not interfere or be
inconsistent with his duties hereunder or be in any way detrimental to
Employer's business interests or hinder Employer in conducting its business.
2.02 Residence. Employer and Employee acknowledge that Employee currently
resides in Dallas, Texas. During the term of this Agreement, Employee agrees
that he shall reside in Austin, Texas, Monday through Friday of every week and,
if possible, shall acquire accommodations in an apartment complex for which
Employer or any of its subsidiaries provides services.
ARTICLE III
COMPENSATION
3.01 Salary. Employee shall be entitled to receive from Employer an aggregate
base salary of $15,000 per month or a total of $45,000 in the aggregate for the
Term of this Agreement. The base salary to be paid to Employee shall be paid in
accordance with Employer's standard payroll practices as may exist from time to
time following the Effective Date and shall be subject to applicable
withholding, FICA and other taxes, if any.
3.02 Stock Options.
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(a) If Employee remains in the employment of Employer through
the full 90-day term of this Agreement, Employer at that time shall grant to
Employee fully-vested, ten-year options (incentive stock options to the extent
possible), pursuant to Employer's stock option plan, to acquire 15,000 shares
of Employer common stock. The options shall be exercisable at the fair market
value of the shares determined as of the date of grant of the options. If the
Board of Directors enters into a further written contract with Employee to
extend the initial 90-day term of Employee's employment with Employer,
Employer shall concurrent with such new agreement grant ten-year options to
Employee (incentive stock options to the extent possible) for an additional
235,000 shares to vest during such employment as follows: 25% (58,750 options)
shall be immediately vested upon grant, and an additional 25% shall vest on
each anniversary of the Effective Date of this Agreement until all options are
vested; provided, however, that in no case shall any options vest at any time
after Employee's employment with Employer has been terminated.
(b) If Employee's employment terminates for any reason, the
vested options shall in the Employee's discretion, be exercisable as provided
in the Employer's standard option award agreement or shall be exercisable for
a period of one year after such termination. In the event of a change of
control (as defined in Employer's stock option plan), all options granted to
Employee shall immediately vest. Upon termination of Employee's employment,
all unvested options shall terminate. If, after the date of this Agreement,
Employer registers any employee stock options under the Securities Act of
1933, shares issuable upon Employee's exercise of options shall be included in
such registration.
ARTICLE IV
BENEFITS
4.01 Benefits. During the Term (or any extension thereof), Employee shall be
eligible to participate in any and all group life insurance plans and medical
and dental health benefit plans and the like and all other employee benefit
plans maintained by Employer from time to time for which Employee qualifies.
ARTICLE V
TERMINATION
5.01 Termination. The Board of Directors may terminate Employee's employment
under this Agreement with or without cause by giving Employee immediate notice
and the payment of an amount equal to $45,000 less any salary previously paid to
Employee by Employer pursuant to this Agreement, said payment to be subject to
applicable withholding, FICA and other taxes, if any, and thereafter no further
consideration shall be owed by Employer to Employee.
5.02 Termination of Employee. Employee may terminate his employment under this
Agreement by giving Employer at least 10 business days' prior written notice of
such termination. Upon such termination, or upon termination of this Agreement
due to Employee's death or disability, Employee shall be paid a pro rata portion
of his salary determined based upon the number of days Employee has worked.
ARTICLE VI
EXPENSE REIMBURSEMENT
Employee is authorized to incur reasonable business expenses in
promoting the business of Employer, including expenditures for round-trip travel
from Dallas to Austin once a week, all in accordance with the policies of
Employer after the Effective Date, so long as Employee obtains the written
approval of the Board of Directors Ad Hoc Committee. Subject to the requirements
of this Article VI, Employer will reimburse Employee from time to time for all
business expenses incurred in compliance with such policies.
ARTICLE VII
COVENANT NOT TO COMPETE, TRADE SECRETS AND ASSIGNMENTS
7.01 Covenant Not to Compete. Employee recognizes and acknowledges that Employer
is placing its confidence and trust in Employee. Employee will have access to
information that enables Employer to be successful in its business. Some of the
information may be confidential and constitute trade secrets; however, that
information when combined with all other information regarding Employer,
constitutes proprietary information and methods that could seriously affect the
ability of Employer to do business if Employee were allowed to use it other than
for Employer. Employee, therefore, covenants and agrees that for a period
beginning on the date hereof and ending three months after the termination of
this Agreement or Employee's employment, Employee shall not continue or commence
(without the prior written consent of Employer) to:
(a) Either directly or indirectly engage in or carry on any business or in any
way become associated with or acquire an ownership interest in any business
that is in direct competition with the Business of Employer (as such term is
used and defined herein) in any city in which Employer conducts business. As
used in this Article VII, the term "Business of the Employer" shall include
all business activities in which Employer is now engaged and shall further
include any business in which Employer is engaged on the date of termination
of Employee's employment;
(b) Attempt in any manner to solicit from any person or entity that is or was a
customer of Employer at any time prior to the date of termination of
Employee's termination, business of the type performed or formerly performed
by Employer for such customer or to persuade any customer of Employer to cease
to do business or to reduce the amount of business which any such customer has
customarily done with Employer or contemplates doing with Employer; or provide
to or for any customer any services or products of the type provided by
Employer (as used herein the noun "customer" shall mean anyone who is a client
or customer, supplier, sales representative or other person who does business
with Employer: (i) as of the date hereof or the date of Employee's termination
or at the time of the alleged conduct; and (ii) at any time during the
12-month period immediately preceding the time of alleged prohibited conduct);
and
(c) Either directly or indirectly solicit for employment or employ any person
employed by Employer at any time during the 12-month period immediately
preceding such solicitation or employment.
Nothing in this Section 7.01 will prevent Employee from owning less
than five percent of the stock of any publicly traded corporation after the
termination of his employment as long as Employee is not a participant in the
management or affairs of a company in a manner that would otherwise violate any
prohibition contained in this Section 7.01.
7.02 Confidential Information. Concurrently with the execution of this
Agreement, Employee will execute the Employee Innovation Assignment,
Nondisclosure, Noncompete and Nonsolicitation Agreement in substantially the
form of Exhibit B attached hereto (the "Invention Agreement").
7.03 Survival. Notwithstanding the termination of the employment of Employee or
the termination of this Agreement, the
provisions of Section 7.01 shall survive.
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES OF EMPLOYEE
8.01 Representations and Warranties of Employee. Except as shall be fully
disclosed to the Board of Directors of Employer and consented to by a majority
of the members of Employer's Board of Directors, Employee hereby represents and
warrants that (i) he has no, and during the term of this Agreement will not have
any, affiliation, direct or indirect, with any person, firm or other entity that
is in any way affiliated with any member of the Board of Directors of Employer,
including specifically, but without limitation, Redfire, Inc., Redfire Capital
Fund, L.L.C. (collectively, "Redfire") or Peregrine Capital, Inc. (all of such
persons, firms and/or entities being defined for purposes of this Agreement as
"Prohibited Parties"), and (ii) no commissions, finder's fees or other payments
of any kind will be paid by Employee to any Prohibited Party or any affiliates
thereof resulting from Employee's employment by Employer. Employee shall be
compensated for any business opportunities developed prior to Employee's
employment and disclosed to and consented to by a majority of the members of the
Company's Board of Directors, if the Company exploits such business
opportunities.
ARTICLE IX
MISCELLANEOUS
9.01 Notices. Any notices to be given hereunder by either party to the other may
be effected either by personal delivery in writing, via telecopy, or by mail,
registered or certified, postage prepaid with return receipt requested. Mailed
and telecopied notices shall be addressed to Employee at the address set forth
on the signature page hereto and to Employer at the following address:
If to Employer: USOL Holdings, Inc.
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00000 Xxxxxx Xxxxxxxxx
Xxxxxx, Xxxxx 00000
Attn: Board of Directors
Any party may change his or its address by written notice in accordance with
this Section. Notices delivered personally shall be deemed communicated as of
actual receipt, telecopied as of receipt of confirmation of delivery, and mailed
notices shall be deemed communicated as of three days after proper mailing.
9.02 Inclusion of Entire Agreement Herein. This Agreement, together with its
Exhibits, supersedes any and all other agreements either oral or in writing,
between the parties with respect to the employment of Employee by Employer and
contains all of the covenants and agreements between the parties with respect to
such employment in any manner whatsoever.
9.03 Law Governing Agreement. This Agreement shall be governed by and construed
in accordance with the laws of the State of Texas, without resort to the
conflict of law principles thereof.
9.04 Attorney's Fees and Costs. 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 reasonable attorney's fees, costs and necessary disbursements in
addition to any other relief to which such party may be entitled.
9.05 Waiver. No term or condition of this Agreement shall be deemed to have been
waived nor shall there by any estoppel to enforce any of the terms or provisions
of this Agreement except by written instrument of the party charged with such
waiver or estoppel. Further, it is agreed that no waiver at any time of any of
the terms or provisions of this Agreement shall be construed as a waiver of any
of the other terms or provisions of this Agreement and that a waiver at any time
of any of the terms or provisions of this Agreement shall not be construed as a
waiver at any subsequent time of the same terms or provisions.
9.06 Amendments. Except as otherwise provided in Section 9, no amendment or
modification of this Agreement shall be deemed effective unless and until
executed in writing by all of the parties.
9.07 Severability and Limitation. All agreements and covenants contained herein
are severable and, in the event any of them shall be held to be invalid by any
competent court, this Agreement shall be interpreted as if such invalid
agreements or covenants were not contained herein. Should any court or other
legally constituted authority determine that for any such agreement or covenant
to be effective that it must be modified to limit its duration or scope, the
parties shall consider such agreement or covenant to be amended or modified with
respect to duration and scope so as to comply with the orders of any such court
or other legally constituted authority, and as to all other portions of such
agreement or covenants they shall remain in full force and effect as originally
written.
9.08 Headings. All headings set forth in this Agreement are intended for
convenience only and shall not control or affect the meaning construction or
effect of this Agreement or of any of the provisions thereof.
9.09 Assignment. This Agreement may not be assigned, in whole or in part, by
Employee, but may be assigned by Employer to any person, partnership, firm,
association, corporation or other business entity to which Employer may transfer
its business and assets or any portion thereof.
9.10 Intentionally Omitted.
9.11 Arbitration. Except as expressly provided below, any dispute arising out of
this Employment Agreement or Employee's employment or other relations with the
Employer, including any termination of employment, will be submitted to binding
arbitration pursuant to the rules of the American Arbitration Association. Each
party expressly waives its entitlement, if any, to have any such controversy
heard before a court or jury. Either party may, within 90 days of the occurrence
of the event giving rise to the dispute, initiate arbitration by notifying the
other in writing. Failure to initiate arbitration within such 90-day period, or
such extended period as may be mutually agreed in writing within such 90-day
period, shall constitute a waiver of any and all such claims, and they shall be
forever barred. Both parties will attempt to agree upon a mutually acceptable
arbitrator. If the Employer and Employee are unable to agree upon one
arbitrator, then an arbitrator shall be selected in accordance with the
then-current rules of the American Arbitration Association. The arbitrator's
decision will be final and binding on both parties. Employee and the Employer
will each bear its own costs in connection with any such arbitration. The cost
of the arbitrator will be shared equally by Employee and the Employer. The
arbitrator shall have no authority to award punitive or exemplary damages
against any party. Arbitration shall take place in Austin, Texas, unless
otherwise agreed between the parties in writing.
9.12 Exclusive Remedies. The provision set forth herein respecting the rights
and obligations of Employee and the Company in any dispute arising out of this
Employment Agreement or Employee's employment by the Employer are intended to
be, and are, exclusive and in lieu of any other rights or remedies to which
Employee or the Employer may otherwise be entitled at law, tort or contract in
equity or under this Employment Agreement.
[Signature page follows]
EXECUTED as of the day and year first above written.
EMPLOYER:
USOL HOLDINGS, INC.,
An Oregon Corporation
By:
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EMPLOYEE:
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XXX XXXXXXXXXX
Address:
EXHIBIT A
LIST OF EMPLOYEE OBJECTIVES
1. Prepare and, subject to the Board of Directors' approval, implement a
plan to reduce corporate overhead expenses and any unnecessary cash
disbursements.
2. Increase net revenue from existing operations.
3. Maintain Employer's compliance with all loan covenants.
4. Develop a contingency plan for the Broadbandnow situation.
5. Improve if possible, Field EBITDA and if not, at least maintain Field
EBITDA at its current level.
6. Within 30 days of the Effective Date, develop and submit a cost savings
plan to Employer's Board of Directors which includes proposals for
changes to Employer's systems, procedures and practices, including the
automation of certain tasks.
EXHIBIT B
EMPLOYEE INNOVATION ASSIGNMENT, NONDISCLOSURE,
NONCOMPETE & NONSOLICITATION AGREEMENT
EMPLOYEE INNOVATION ASSIGNMENT, NONDISCLOSURE,
NONCOMPETE & NONSOLICITATION AGREEMENT
This Agreement is entered into by and between USOL Holdings, Inc., an
Oregon corporation ("Company"), and Xxx Xxxxxxxxxx on this 13th day of June,
2001. In return for my new employment by Company and other good and valuable
consideration, the receipt and sufficiency of which I hereby acknowledge, I
acknowledge and agree that:
1. Intentionally Omitted
2. Intentionally Omitted.
3. Proprietary Information. My employment creates a relationship of
confidence and trust between Company and me with respect to any information:
(a) Applicable to the business of Company; or
(b) Applicable to the business of any client or customer of Company,
which may be made known to me by Company or by any client or customer of
Company, or learned by me in such context during the period of my employment.
All such information has commercial value in the business in which Company is
engaged and is hereinafter called "Proprietary Information." By way of
illustration, but not limitation, Proprietary Information includes any and all
technical and non-technical information including patent, copyright, trade
secret, and proprietary 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 Company, and includes, without limitation,
respective information concerning research, experimental work, development,
design details and specifications, engineering, financial information,
procurement requirements, purchasing manufacturing, customer lists, business
forecasts, sales and merchandising and marketing plans and information.
"Proprietary Information" also includes proprietary or confidential information
of any third party who may disclose such information to Company or to me in the
course of Company's business.
4. Ownership and Nondisclosure of Proprietary Information. All
Proprietary Information is the sole property of Company, Company's assignees,
and Company's customers, and shall be the sole and exclusive owner of all
patents, copyrights, mask works, trade secrets and other rights in the
Proprietary Information. I hereby do and will assign to Company all rights,
title and interest I may have or acquire in the Proprietary Information. At all
times, both during my employment by Company and after termination of such
employment, I will keep in confidence and trust all Proprietary Information, and
I will not use or disclose any Proprietary Information or anything directly
relating to Proprietary Information without the written consent of Company,
except as may be necessary in the ordinary course of performing my duties as an
employee of Company.
5. 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 me by Company shall
remain the property of Company. Upon termination of my employment, or at any
time on the request of Company before termination, I will promptly (but no later
than five (5) days after the earlier of my employment's termination or Company's
request) destroy or deliver to Company, at Company's option, (a) all materials
furnished to me by Company, (b) all tangible media of expression which are in my
possession and which incorporate any Proprietary Information or otherwise relate
to Company's business, and (c) written certification of my compliance with my
obligations under this sentence.
6. Innovations. As used in this Agreement, 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 rights, 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 protected under patent laws.
7. Intentionally Omitted.
8. Assignment of Innovations; License of Prior Innovations. Except for
those business opportunities that have been rejected by the Company's Board of
Directors, I hereby agree promptly to disclose and describe to the Company, and,
other than business opportunities that have been fully disclosed to the
Company's Board of Directors and rejected as opportunities of interest to the
Company by the Board of Directors, I hereby do and will assign to Company or
Company's designee my entire right, title, and interest in and to, (a) each of
the Innovations (including Inventions), and any associated intellectual property
rights, which I may solely or jointly conceive, reduce to practice, create,
derive, develop or make during the period of my employment with Company, which
either (i) relate, at the time of conception, reduction to practice, creation,
derivation, development, or making of such Innovation, to Company's business or
actual or demonstrably anticipated research or development, or (ii) were
developed on any amount of Company's time or with the use of any of Company's
equipment, supplies, facilities or trade secret information, or (iii) resulted
from any work I performed for Company, and (b) each of the Innovations which is
not an Invention (as demonstrated by me by evidence meeting the clear and
convincing standard of proof), and any associated intellectual property rights,
which I may solely or jointly conceive, develop, reduce to practice, create,
derive, develop, or make during the period of my employment with Company, which
are applicable to the business of Company (collectively, the Innovations
identified in clauses (a) and (b) are hereinafter the "Company Innovations").
9. Intentionally Omitted.
10. Indemnity. I will indemnify, defend and hold Company, its clients
or customers and their respective employees and agents harmless from and against
all losses, liabilities, claims, damages, fines, penalties, settlements,
judgements, costs, and expenses (including reasonable attorneys' fees) that are
incurred as the result of a breach of any of my representations and warranties
contained herein.
11. Cooperation in Perfecting Rights to Proprietary Information and
Innovations.
(a) I agree to perform, during my employment, all acts deemed necessary
or desirable by Company to permit and assist Company, at Company's expense, in
obtaining and enforcing the full benefits, enjoyment, rights and title
throughout the world in the Proprietary Information and Innovations assigned or
licensed to, or whose rights are irrevocably waived and shall not be asserted
against, Company under this Agreement. Such acts may include, but are not
limited to, execution of documents and assistance or cooperation (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, or other proprietary rights, and (iii) in other legal proceedings
related to the Proprietary Information or Innovations.
(b) Intentionally Omitted.
12. No Violation of Rights of Third Parties. My performance of all the
terms of this Agreement and as an employee of Company does not and will not
breach any agreement to keep in confidence proprietary information, knowledge or
data acquired by me prior to my employment with Company, and I will not disclose
to Company, or induce Company to use, any confidential or proprietary
information or material belonging to any previous employer or others. I am not a
party to any other agreement which will interfere with my full compliance with
this Agreement. I agree not to enter into any agreement, whether written or
oral, in conflict with the provisions of this Agreement.
13. Intentionally Omitted.
14. Survival. This Agreement (a) shall survive my employment by
Company; (b) does not in any way restrict my right or the right of Company to
terminate my employment at any time, for any reason or for no reason; (c) inures
to the benefit of successors and assigns of Company; and (d) is binding upon my
heirs and legal representatives.
15. Intentionally Omitted.
16. Intentionally Omitted.
17. Notices. Any notice required or permitted by this Agreement shall
be in writing and shall be delivered as follows, with notice deemed given as
indicated: (a) by personal delivery, when delivered personally; (b) by overnight
courier, upon written verification of receipt; (c) by telecopy or facsimile
transmission, upon acknowledgment of receipt of electronic transmission; or (d)
by certified or registered mail, return receipt requested, upon verification of
receipt. Notices to me shall be sent to any address in Company's records or such
other address as I may specify in writing. Notices to Company shall be sent to
Company's Human Resources Department and to the Chairman of the Company's Board
of Directors or to such other address as Company may specify in writing.
18. Governing Law. This Agreement shall be governed in all respects by
the laws of the United States of America and by the laws of the State of Texas.
Each of the parties irrevocably consents to the exclusive personal jurisdiction
of the federal and state courts located in Texas, as applicable, for any matter
arising out of or relating to this Agreement, except that in actions seeking to
enforce any order or any judgment of such federal or state courts located in
Texas, such personal jurisdiction shall be nonexclusive.
19. Severability. If any provision of this Agreement is held by a court
of law to be illegal, invalid or unenforceable, (i) that provision shall be
deemed amended to achieve as nearly as possible the same economic effect as the
original provision, and (ii) the legality, validity and enforceability of the
remaining provisions of this Agreement shall not be affected or impaired
thereby.
20. Waiver; Amendment; Modification. The waiver by Company of a term or
provision of this Agreement, or of a breach of any provision of this Agreement
by me, shall not be effective unless such waiver is in writing signed by
Company. No waiver by Company of, or consent by Company to, a breach by me, will
constitute a waiver of, consent to or excuse of any other or subsequent breach
by me. This Agreement may be amended or modified only with the written consent
of both me and Company. No oral waiver, amendment or modification shall be
effective under any circumstances whatsoever.
21. Entire Agreement. This Agreement represents my entire understanding
with Company with respect to the subject matter of this Agreement and supersedes
all previous understandings, written or oral.
[The remainder of this page is intentionally left blank.]
I certify and acknowledge that I have carefully read all of the
provisions of this Agreement and that I understand and will fully and faithfully
comply with such provisions.
IN WITNESS WHEREOF, the parties hereto execute this Agreement as of the
date first set forth above.
COMPANY: EMPLOYEE:
USOL HOLDINGS, INC.
By:
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Printed Name: Xxx Xxxxxxxxxx
Address:
