Exhibit 10.24
DIGITALTHINK, INC.
EMPLOYMENT AGREEMENT
This Agreement is entered into as of January 27, 2003, (the "Effective Date") by
and between DigitalThink, Inc. (the "Company"), and J. Xxx Xxxxx ("Executive").
1. Duties and Scope of Employment.
(a) Position and Duties. As of the Effective Date, Executive will serve as
DigitalThink's Executive Vice President, Sales and Marketing. Executive will
render such business and professional services in the performance of his duties,
consistent with Executive's position within the Company, as shall reasonably be
assigned to him by the Company's President and CEO or Board of Directors. The
period of Executive's employment under this Agreement is referred to herein as
the "Employment Term."
(b) Obligations. During the Employment Term, Executive will perform his duties
faithfully and to the best of his ability and will devote his full business
efforts and time to the Company. For the duration of the Employment Term,
Executive agrees not to actively engage in any other employment, occupation or
consulting activity for any direct or indirect remuneration without the prior
approval of the President and CEO.
2. At-Will Employment. The parties agree that Executive's employment with the
Company will be "at-will" employment and may be terminated at any time with or
without cause or notice. Executive understands and agrees that neither his job
performance nor promotions, commendations, bonuses or the like from the Company
give rise to or in any way serve as the basis for modification, amendment, or
extension, by implication or otherwise, of his employment with the Company.
3. Place of Employment. The Executive's services shall be performed at the
Company's principal executive offices in San Francisco, California. The parties
acknowledge, however, that the Executive may be required to travel in connection
with the performance of his duties hereunder.
4. Compensation.
(a) Base Salary. For all services to be rendered by the Executive pursuant to
this Agreement, the Company agrees to pay the Executive during the Employment
Period a base salary (the "Base Salary") at an annual rate of not less than
$240,000. The Base Salary shall be paid in periodic installments in accordance
with the Company's regular payroll practices. The Company agrees to review the
Base Salary at least annually beginning in April 2004 and to make such increases
therein as the Board of Directors may approve.
(b) Commissions. Beginning on the Effective Date continuing for the fiscal year
ending March 31, 2004, and assuming the Employment Term is still in effect,
Executive will be eligible to receive commissions of 0.33% on all new orders up
to $50 million and commissions of 0.5% for orders in excess of $50 million. All
commissions will be calculated and paid upon the issuance of customer invoices.
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(c) Stock Option.
(i) Initial Option. Effective as of the Effective Date, the Company shall grant
the Executive an option (the "Option") to purchase 400,000 shares of the
Company's common stock (the "Option Shares") at a per share exercise price equal
to the fair market value of DigitalThink's Common Stock as quoted on NASDAQ on
the day before the Effective Date. The Initial Option shall vest as described
below and shall be subject to such other terms and conditions as are described
in paragraph 4(c)(iii).
(ii) Vesting. Subject to the accelerated vesting
provisions set forth herein in case of termination after a Change of Control,
the Option Shares will vest as to 25% of the shares subject to the Option one
year after the date of grant, and as to 1/48th of the shares subject to the
Option monthly thereafter, so that the Option will be fully vested and
exercisable four (4) years from the date of grant, subject to Executive's
continued service to the Company on the relevant vesting dates. In addition, in
the event of a Change in Control (as defined below), one-half (1/2) of the
unvested portion of the Option shall automatically accelerate and the Executive
shall have the right to exercise all or any portion of such Options, in addition
to any portion of the Option(s) exercisable prior to such event.
(iii) Option Provisions. The Option shall be granted under the DigitalThink 1996
Stock Option Plan (the "Stock Plan") and, except as expressly provided otherwise
in this paragraph 4, shall be subject to the terms and conditions of the Stock
Plan and form of option agreement; provided, however, that the Company's Board
of Directors may, in its discretion, grant the Option outside of the Stock Plan,
and any such Options shall include such other terms as the Board of Directors
may specify that are not inconsistent with the terms hereof. The Option will
expire on the first to occur of: (i) in the event the Executive's employment
terminates by reason of the Executive's death or by the Company as a result of
the Executive's Disability, twelve (12) months from the date of such
termination; (ii) in the event the Executive terminates his employment for Good
Reason, or in the event the Company terminates the Executive's employment other
than for Cause, three (3) months from the date of such termination; (iii) in the
event the Executive resigns (other than for Good Reason) or is terminated by the
Company for Cause, three (3) months after the date of such resignation or
termination; or (iv) ten (10) years from the date of grant of the Option.
(d) Automobile Allowance. During the Employment Term, the Company will pay
Executive $400 per month for automobile expenses.
5. Employee Benefits. During
the Employment Period, the Executive shall be entitled to participate in
employee benefit plans or programs of the Company, if any, to the extent that
his position, tenure, salary, age, health and other qualifications make him
eligible to participate, subject to the rules and regulations applicable
thereto. The Company reserves the right to cancel or change the benefit plans
and programs it offers to its employees at any time.
6. Vacation. Executive will be entitled to paid vacation in accordance with the
Company's vacation policy, with the timing and duration of specific vacations
mutually and reasonably agreed to by the parties hereto. Executive agrees that
he will not accrue vacation during the Employment Term.
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7. Expenses. The Executive shall be entitled to prompt reimbursement by the
Company for all reasonable ordinary and necessary travel, entertainment, and
other expenses incurred by the Executive during the Employment Period (in
accordance with the policies and procedures established by the Company for its
senior executive officers) in the performance of his duties and responsibilities
under this Agreement; provided, that the Executive shall properly account for
such expenses in accordance with Company policies and procedures. The parties
agree that for purposes of this paragraph, the Executive's air travel shall be
coach class, unless otherwise approved by the President and CEO.
8. Other Activities. The Executive shall devote substantially all of his working
time and efforts during the Company's normal business hours to the business and
affairs of the Company and its subsidiaries and to the diligent and faithful
performance of the duties and responsibilities duly assigned to him pursuant to
this Agreement, except for vacations, holidays and sickness. However, the
Executive may devote a reasonable amount of his time to civic, community, or
charitable activities and, with the prior written approval of the Board of
Directors, to serve as a director of other corporations and to other types of
business or public activities not expressly mentioned in this paragraph.
9. Change of Control.
(a) For purposes of this Agreement, the term "Change of Control" shall mean the
occurrence of any of the following events:
(1) Any "person" (as such term is
used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")) 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 percent (50%) or more of the total voting power
represented by the Company's then outstanding voting securities; or
(2) A merger or consolidation of the Company with any other corporation, other
than a merger or consolidation which would result in the voting securities of
the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities of
the surviving entity) at least fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation, or the stockholders
of the Company approve a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the Company of all or substantially all
the Company's assets.
(b) Involuntary Termination Not for Cause. In the event of a Change of Control,
if Executive's employment with the Company terminates within two years of the
Change of Control, other than voluntarily not for "Good Reason" (as defined
herein) or for "Cause" (as defined herein), and Executive signs and does not
revoke the Company's severance and release agreement, then, subject to Section
11, Executive shall be entitled to receive continuing payments of severance pay
(less applicable withholding taxes) at a rate equal to his Base Salary rate, as
then in effect, for a period of six (6) months from the date of such
termination, to be paid periodically in accordance with the Company's normal
payroll policies; and (ii) one-half (1/2) any unvested portion of the Option
shall immediately vest and become exercisable.
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(c) Voluntary Termination; Termination for Cause. If Executive's employment with
the Company terminates voluntarily by Executive not for Good Reason or for Cause
by the Company, then (i) all vesting of the Option will terminate immediately
and all payments of compensation by the Company to Executive hereunder will
terminate immediately (except as to amounts already earned), and (ii) Executive
will only be eligible for severance benefits in accordance with the Company's
established policies as then in effect.
(d) Cause. For all purposes under this Agreement, "Cause" shall mean (i) willful
failure by the Executive to substantially perform his duties hereunder, other
than a failure resulting from the Executive's complete or partial incapacity due
to physical or mental illness or impairment, (ii) a willful act by the Executive
which constitutes gross misconduct and which is injurious to the Company, (iii)
a willful breach by the Executive of a material provision of this Agreement, or
(iv) a material and willful violation of a federal or state law or regulation
applicable to the business of the Company. No act, or failure to act, by the
Executive shall be considered "willful" unless committed without good faith
without a reasonable belief that the act or omission was in the Company's best
interest. No compensation or benefits will be paid or provided to the Executive
under this Agreement on account of a termination for Cause, or for periods
following the date when such a termination of employment is effective. The
Executive's rights under the benefit plans of the Company shall be determined
under the provisions of those plans.
(e) Good Reason. For all purposes under this Agreement, "Good Reason" means
termination following (i) a reduction in Employee's level of responsibility or
(ii) a change in Employee's place of employment which is more than One Hundred
(100) miles from Employee's place of employment prior to the change; provided
and only if, such change is effected without Employee's written agreement.
10. Proprietary Information. During the Employment Period and
thereafter, the Executive shall not, without the prior written consent of the
Board of Directors, disclose or use for any purpose (except in the course of his
employment under this Agreement and in furtherance of the business of the
Company or any of its affiliates or subsidiaries) any confidential information
or proprietary data of the Company. As an express condition of the Executive's
employment with the Company, the Executive agrees to execute confidentiality
agreements as requested by the Company, including but not limited to the
Company's standard Confidential Information and Invention Assignment Agreement
(the "Confidentiality Agreement"), which is attached hereto as Exhibit A and
incorporated herein by reference.
11. Non-Solicitation.
(a) Non-Solicitation. During the twelve (12) months after the termination of
Executive's employment with the Company for any reason, Executive agrees and
acknowledges that Executive will not either directly or indirectly solicit,
induce, attempt to hire, recruit, encourage, take away, hire any employee of the
Company or cause an employee to leave his or her employment either for Executive
or for any other entity or person.
(b) Conditional Nature of Severance Payments. Executive agrees and acknowledges
that Executive's right to receive the severance payments set forth in Section 9
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(to the extent Executive is otherwise entitled to such payments) shall be
conditioned upon compliance with the non-solicitation obligation set forth in
this Section 11.
12. Right to Advice of Counsel. The Executive acknowledges that he has consulted
with counsel and is fully aware of his rights and obligations under this
Agreement.
13. Successors. The Company will require any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. Failure of the Company to obtain such assumption agreement
prior to the effectiveness of any such succession shall entitle the Executive to
the benefits described in paragraph 9 of this Agreement, subject to the terms
and conditions therein.
14. Assignment. This Agreement and all rights under this
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the parties hereto and their respective personal or legal representatives,
executors, administrators, heirs, distributees, devisees, legatees, successors
and assigns. This Agreement is personal in nature, and neither of the parties to
this Agreement shall, without the written consent of the other, assign or
transfer this Agreement or any right or obligation under this Agreement to any
other person or entity; except that the Company may assign this Agreement to any
of its affiliates or wholly-owned subsidiaries, provided, that such assignment
will not relieve the Company of its obligations hereunder. If the Executive
should die while any amounts are still payable to the Executive hereunder, all
such amounts, unless otherwise provided herein, shall be paid in accordance with
the terms of this Agreement to the Executive's devisee, legatee, or other
designee or, if there be no such designee, to the Executive's estate.
15. Absence of Conflict. The Executive represents and warrants that his
employment by the Company as described herein shall not conflict with and will
not be constrained by any prior employment or consulting agreement or
relationship.
16. Notices. All notices, requests, demands and other
communications called for hereunder shall be in writing and shall be deemed
given (i) on the date of delivery, or, if earlier, (ii) one (1) day after being
sent by a well established commercial overnight service, or (iii) three (3) days
after being mailed by registered or certified mail, return receipt requested,
prepaid and addressed to the parties or their successors at the following
addresses, or at such other addresses as the parties may later designate in
writing:
If to the Executive: J. Xxx Xxxxx
00000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
If to the Company: DigitalThink, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: General Counsel
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or to such other address or the attention of such other person as the recipient
party has previously furnished to the other party in writing in accordance with
this paragraph.
17. Waiver. Failure or delay on the part of either party hereto
to enforce any right, power, or privilege hereunder shall not be deemed to
constitute a waiver thereof. Additionally, a waiver by either party or a breach
of any promise hereof by the other party shall not operate as or be construed to
constitute a waiver of any subsequent waiver by such other party.
18. Severability. Whenever possible, each provision of this Agreement will be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
19. Arbitration.
(a) Arbitration. In consideration of Executive's employment with the "Company",
its promise to arbitrate all employment-related disputes and Executive's receipt
of the compensation, pay raises and other benefits paid to Executive by the
Company, at present and in the future, Executive agrees that any and all
controversies, claims, or disputes with anyone (including the Company and any
employee, officer, director, shareholder or benefit plan of the Company in their
capacity as such or otherwise) arising out of, relating to, or resulting from
Executive's employment with the Company or the termination of Executive's
employment with the Company, including any breach of this agreement, shall be
subject to binding arbitration under the arbitration rules set forth in
California Code of Civil Procedure Section 1280 through 1294.2, including
Section 1283.05 (the "Rules") and pursuant to California law. Disputes which
Executive agrees to arbitrate, and thereby agrees to waive any right to a trial
by jury, include any statutory claims under State or Federal law, including, but
not limited to, claims under Title VII of the Civil Rights Act of 1964, the
Americans with Disabilities Act of 1990, the Age Discrimination in Employment
Act of 1967, the Older Workers Benefit Protection Act, the California Fair
Employment and Housing Act, the California Labor Code, claims of harassment,
discrimination or wrongful termination and any statutory claims. Executive
further understands that this agreement to arbitrate also applies to any
disputes that the Company may have with employee.
(b) Procedure. Executive agrees that any arbitration will be administered by the
American Arbitration Association ("AAA") and that a neutral arbitrator will be
selected in a manner consistent with its national rules for the resolution of
employment disputes. The arbitration proceedings will allow for discovery
according to the rules set forth in the National Rules for the Resolution of
Employment Disputes. Executive agrees that the arbitrator shall have the power
to decide any motions brought by any party to the arbitration, including motions
for summary judgment and/or adjudication and motions to dismiss and demurrers,
prior to any arbitration hearing. Executive agrees that the arbitrator shall
issue a written decision on the merits. Executive also agrees that the
arbitrator shall have the power to award any remedies, including attorneys' fees
and costs, available under applicable law. Executive understands the Company
will pay for any administrative or hearing fees charged by the arbitrator or AAA
except that Executive shall pay the first $200.00 of any filing fees associated
with any arbitration Executive initiates. Executive agrees that the arbitrator
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shall administer and conduct any arbitration in a manner consistent with the
rules and that to the extent that the AAA's National Rules for the Resolution of
Employment Disputes conflict with the rules, the rules shall take precedence.
(c) Remedy. Except as provided by the rules, arbitration shall be the sole,
exclusive and final remedy for any dispute between Executive and the Company.
Accordingly, except as provided for by the rules, neither Executive nor the
Company will be permitted to pursue court action regarding claims that are
subject to arbitration. Notwithstanding, the arbitrator will not have the
authority to disregard or refuse to enforce any lawful Company policy, and the
arbitrator shall not order or require the Company to adopt a policy not
otherwise required by law which the Company has not adopted.
(d) Availability of Injunctive Relief. In accordance with Rule 1281.8 of the
California Code of Civil Procedure, Executive agrees that any party may also
petition the court for injunctive relief where either party alleges or claims a
violation of the employment, confidential information, invention assignment
agreement between Executive and the Company or any other agreement regarding
trade secrets, confidential information, nonsolicitation or Labor Code ss.2870.
In the event either party seeks injunctive relief, the prevailing party shall be
entitled to recover reasonable costs and attorneys fees.
(e) Administrative Relief. Executive understands that this agreement does not
prohibit Executive from pursuing an administrative claim with a local, state or
federal administrative body such as the department of fair employment and
housing, the equal employment opportunity commission or the workers'
compensation board. This agreement does, however, preclude Executive from
pursuing court action regarding any such claim.
(f) Voluntary Nature of Agreement. Executive acknowledges and agrees that
Executive is executing this agreement voluntarily and without any duress or
undue influence by the Company or anyone else. Executive further acknowledges
and agrees that Executive has carefully read this agreement and that Executive
has asked any questions needed for Executive to understand the terms,
consequences and binding effect of this agreement and fully understand it,
including that Executive is waiving Executive's right to a jury trial. Finally,
Executive agrees that he/she has been provided an opportunity to seek the advice
of an attorney before signing this agreement.
20. Integration. This Agreement, together with the Option Plan, Option Agreement
and the Employment, Confidential Information and Invention Assignment Agreement
represents the entire agreement and understanding between the parties as to the
subject matter herein and supersedes all prior or contemporaneous agreements
whether written or oral. No waiver, alteration, or modification of any of the
provisions of this Agreement will be binding unless in writing and signed by the
Company.
21. Headings. The headings of the paragraphs contained in this
Agreement are for reference purposes only and shall not in any way affect the
meaning or interpretation of any provision of this Agreement.
22. Applicable Law. This Agreement shall be governed by and construed in
accordance with the internal substantive laws, and not the choice of law rules,
of the State of California. Executive hereby consents to the exclusive personal
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jurisdiction and venue of the courts of the federal and state courts in the
State of California.
23. Counterparts. This Agreement may be executed in one or more counterparts,
none of which need contain the signature of more than one party hereto, and each
of which shall be deemed to be an original, and all of which together shall
constitute a single agreement.
24. Tax Withholding. All payments made pursuant to this Agreement will be
subject to withholding of applicable taxes.
25. Acknowledgment. Executive
acknowledges that he has had the opportunity to discuss this matter with and
obtain advice from his private attorney, has had sufficient time to, and has
carefully read and fully understands all the provisions of this Agreement, and
is knowingly and voluntarily entering into this Agreement.
IN WITNESS WHEREOF, each of the parties has executed this Agreement, in
the case of the Company by their duly authorized officers, as of the day and
year first above written.
COMPANY:
DigitalThink, Inc.
By: /s/ XXXXXXX X. XXXX Date: January 27, 2003
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Title:President and CEO
EXECUTIVE:
/s/ J. XXX XXXXX
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J. Xxx Xxxxx Date: January 27, 2003
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Exhibit A
Employment, Confidential Information and Invention Assignment Agreement
As a condition of my employment with DigitalThink, Inc., its
subsidiaries, affiliates, successors or assigns (together the "Company"), and in
consideration of my employment with the Company and my receipt of the
compensation now and hereafter paid to me by Company, I agree to the following:
I. At-Will Employment. I understand and acknowledge that my employment
with the Company is for an unspecified duration and constitutes "at-will"
employment. I acknowledge that this employment relationship may be terminated at
any time, with or without good cause or for any or no cause, at the option of
either the Company or myself, with or without notice.
II. Confidential Information.
A. Company Information. I agree at all times during the term
of my employment and thereafter to hold in strictest confidence, and not to use,
except for the benefit of the Company, or to disclose to any person, firm or
corporation without written authorization of the Board of Directors of the
Company, any Confidential Information of the Company. I understand that
"Confidential Information" means any Company proprietary information, technical
data, trade secrets or know-how, including, but not limited to, research,
product plans, products, services, customer lists and customers (including, but
not limited to, customers of the Company on whom I called or with whom I became
acquainted during the term of my employment), markets, software, developments,
inventions, processes, technology, designs, drawings, engineering, hardware
configuration information, marketing, finances or other business information
disclosed to me by the Company either directly or indirectly in writing, orally
or by drawings or observation. I further understand that Confidential
Information does not include any of the foregoing items which has become
publicly known and made generally available through no wrongful act of mine or
of others who were under confidentiality obligations as to the item or items
involved.
B. Former Employer Information. I agree that I will not,
during my employment with the Company, improperly use or disclose any
proprietary information or trade secrets of any former or concurrent employer or
other person or entity and that I will not bring onto the premises of the
Company any unpublished document or proprietary information belonging to any
such employer, person or entity unless consented to in writing by such employer,
person or entity.
C. Third Party Information. I recognize that the Company has
received and in the future will receive from third parties their confidential or
proprietary information subject to a duty on the Company's part to maintain the
confidentiality of such information and to use it only for certain limited
purposes. I agree to hold all such confidential or proprietary information in
the strictest confidence and not to disclose it to any person, firm or
corporation or to use it except as necessary in carrying out my work for the
Company consistent with the Company's agreement with such third party.
III. Inventions.
A. Inventions Retained and Licensed. I have attached hereto,
as Exhibit A, a list describing all inventions, original works of authorship,
developments, improvements, and trade secrets which were made by me prior to my
employment with the Company (collectively referred to as "Prior Inventions"),
which belong to me, which relate to the Company's proposed business, products or
research and development, and which are not assigned to the Company hereunder;
or, if no such list is attached, I represent that there are no such Prior
Inventions. If in the course of my employment with the Company, I incorporate
into a Company product, process or machine a Prior Invention owned by me or in
which I have an interest, the Company is hereby granted and shall have a
nonexclusive, royalty-free, irrevocable, perpetual, worldwide license to make,
have made, modify, use and sell such Prior Invention as part of or in connection
with such product, process or machine.
B. Assignment of Inventions. I agree that I will promptly make
full written disclosure to the Company, will hold in trust for the sole right
and benefit of the Company, and hereby assign to the Company, or its designee,
all my right, title, and interest in and to any and all inventions, original
works of authorship, developments, concepts, improvements or trade secrets,
whether or not patentable or registrable under copyright or similar laws, which
I may solely or jointly conceive or develop or reduce to practice, or cause to
be conceived or developed or reduced to practice, during the period of time I am
in the employ of the Company (collectively referred to as "Inventions"). I
further acknowledge that all original works of authorship which are made by me
(solely or jointly with others) within the scope of and during the period of my
employment with the Company and which are protectible by copyright are "works
made for hire," as that term is defined in the United States Copyright Act.
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C. Inventions Assigned to the United States. I agree to assign
to the United States government all my right, title, and interest in and to any
and all Inventions whenever such full title is required to be in the United
States by a contract between the Company and the United States or any of its
agencies.
D. Maintenance of Records. I agree to keep and maintain
adequate and current written records of all Inventions made by me (solely or
jointly with others) during the term of my employment with the Company. The
records will be in the form of notes, sketches, drawings, and any other format
that may be specified by the Company. The records will be available to and
remain the sole property of the Company at all times.
E. Patent and Copyright Registrations. I agree to assist the
Company, or its designee, at the Company's expense, in every proper way to
secure the Company's rights in the Inventions and any copyrights, patents mask
work rights or other intellectual property rights relating thereto in any and
all countries, including the disclosure to the Company of all pertinent
information and data with respect thereto, the execution of all applications,
specifications, oaths, assignments and all other instruments which the Company
shall deem necessary in order to apply for and obtain such rights and in order
to assign and convey to the Company, its successors, assigns and nominees the
sole and exclusive rights, title and interest in and to such Inventions, and any
copyrights, patents, mask work rights or other intellectual property rights
relating thereto. I further agree that my obligation to execute or cause to be
executed, when it is in my power to do so, any such instrument or papers shall
continue after the termination of the Agreement. If the Company is unable
because of my mental or physical incapacity or for any other reason to secure my
signature to apply for or to pursue any application for any United States or
foreign patents or copyright registrations covering Inventions or original works
of authorship assigned to the Company as above, then I hereby irrevocably
designate and appoint the Company and its duly authorized officers and agents as
my agent and attorney in fact, to act for and in my behalf and stead to execute
and file any such applications and to do all other lawfully permitted acts to
further the prosecution and issuance of letters patent or copyright
registrations thereon with the same legal force and effect as if executed by me.
F. Exception to Assignments. I understand that the provisions
of this Agreement requiring assignment of Inventions to the Company do not apply
to any invention which qualifies fully under the provisions of California Labor
Code Section 2870 (attached hereto as Exhibit B). I will advise the Company
promptly in writing of any inventions that I believe meet the criteria in
California Labor Code Section 2870 and not otherwise disclosed on Exhibit A.
IV. Conflicting Employment. I agree that, during the term of my
employment with the Company, I will not engage in any other employment
occupation, consulting or other business activity directly related to the
business in which the Company is now involved or becomes involved during the
term of my employment, nor will I engage in any other activities that conflict
with my obligations to the Company.
V. Returning Company Documents. I agree that, at the time of leaving
the employ of the Company, I will deliver to the Company (and will not keep in
my possession, recreate or deliver to anyone else) any and all devices, records,
data, notes, reports, proposals, lists, correspondence, specifications,
drawings, blueprints, sketches, materials, equipment, other documents or
property, or reproductions of any aforementioned items developed by me pursuant
to my employment with the Company or otherwise belonging to the Company, its
successors or assigns. In the event of the termination of my employment, I agree
to sign and deliver the "Termination Certification" attached hereto as Exhibit
C.
VI. Notification to New Employer. In the event that I leave the employ
of the Company, I hereby grant consent to notification by the Company to my new
employer about my rights and obligations under this Agreement.
VII. Solicitation of Employees. I agree that for a period of twelve
(12) months immediately following the termination of my relationship with the
Company for any reason, whether with or without cause, I shall not either
directly or indirectly solicit, induce, recruit or encourage any of the
Company's employees to leave their employment, or take away such employees, or
attempt to solicit, induce, recruit, encourage or take away employees of the
Company, either for myself or for any other person or entity.
VIII. Conflict of Interest Guidelines. I agree to diligently adhere to
the Conflict of Interest Guidelines attached as Exhibit D hereto.
IX. Representations. I agree to execute any proper oath or verify any
proper document required to carry out the terms of this Agreement. I represent
that my performance of all the terms of this Agreement will not breach any
agreement to keep in confidence proprietary information acquired by me in
confidence or in trust prior to my employment by the Company. I have not entered
into, and I agree I will not enter into, any oral or written agreement in
conflict herewith.
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X. Arbitration and Equitable Relief.
A. Arbitration. Except as provided in Section 10(b) below, I
agree that any dispute or controversy arising out of or relating to any
interpretation, construction, performance or breach of this Agreement, shall be
settled by arbitration to be held in San Francisco, California in accordance
with the rules then in effect of the American Arbitration Association. The
arbitrator may grant injunctions or other relief in such dispute or controversy.
The decision of the arbitrator shall be final, conclusive and binding on the
parties to the arbitration. Judgment may be entered on the arbitrator's decision
in any court having jurisdiction. The Company shall pay for any administrative
or hearing fees charged by the arbitrator or AAA.
B. Equitable Remedies. I agree that it would be impossible or
inadequate to measure and calculate the Company's damages from any breach of the
covenants set forth in Sections 2, 3, and 5 herein. Accordingly, I agree that if
I breach any of such Sections, the Company will have available, in addition to
any other right or remedy available, the right to obtain an injunction from a
court of competent jurisdiction restraining such breach or threatened breach and
to specific performance of any such provision of this Agreement. I further agree
that no bond or other security shall be required in obtaining such equitable
relief and I hereby consent to the issuance of such injunction and to the
ordering of specific performance.
XI. General Provisions
A. Governing Law; Consent to Personal Jurisdiction. This
Agreement will be governed by the laws of the State of California. I hereby
expressly consent to the personal jurisdiction of the state and federal courts
located in California for any lawsuit filed there against me by the Company
arising from or relating to this Agreement.
B. Entire Agreement. This Agreement sets forth the entire
agreement and understanding between the Company and me relating to the subject
matter herein and merges all prior discussions between us. No modification of or
amendment to this Agreement, nor any waiver of any rights under this agreement,
will be effective unless in writing signed by the party to be charged. Any
subsequent change or changes in my duties, salary or compensation will not
affect the validity or scope of this Agreement.
C. Severability. If one or more of the provisions in this
Agreement are deemed void by law, then the remaining provisions will continue in
full force and effect.
D. Successors and Assigns. This Agreement will be binding upon
my heirs, executors, administrators and other legal representatives and will be
for the benefit of the Company, its successors, and its assigns.
-------------------------------------
Date:
-------------------------------------
Signature
-------------------------------------
Name of Employee (typed or printed)
-------------------------------------
Witness
-11-
EXHIBIT A
LIST OF PRIOR INVENTIONS
AND ORIGINAL WORKS OF AUTHORSHIP
Title Date Identifying Number or Brief Description
__ No inventions or improvements
__ Additional sheets attached
-------------------------------------
Date:
-------------------------------------
Signature
-------------------------------------
Name of Employee (typed or printed)
-12-
EXHIBIT B
CALIFORNIA LABOR CODE SECTION 2870
EMPLOYMENT AGREEMENTS; ASSIGNMENT OF RIGHTS
(a) Any provision in an employment agreement which provides
that an employee shall assign, or offer to assign, any of his or her rights in
an invention to his or her employer shall not apply to an invention that the
employee developed entirely on his or her own time without using the employer's
equipment, supplies, facilities, or trade secret information except for those
inventions that either:
(1) Relate at the time of conception or reduction to practice of the
invention to the employer's business, or actual or demonstrably anticipated
research or development of the employer.
(2) Result from any work performed by the employee for the employer.
(b) To the extent a provision in an employment agreement
purports to require an employee to assign an invention otherwise excluded from
being required to be assigned under subdivision (a), the provision is against
the public policy of this state and is unenforceable."
-13-
EXHIBIT C
TERMINATION CERTIFICATION
This is to certify that I do not have in my possession, nor
have I failed to return, any devices, records, data, notes, reports, proposals,
lists, correspondence, specifications, drawings, blueprints, sketches,
materials, equipment, other documents or property, or reproductions of any
aforementioned items belonging to DigitalThink, Inc. its subsidiaries,
affiliates, successors or assigns (together, the "Company").
I further certify that I have compiled with all the terms of
the Company's Employment, Confidential Information and Invention Assignment
Agreement signed by me, including the reporting of any inventions and original
works of authorship (as defined therein), conceived or made by me (solely or
jointly with others) covered by that agreement.
I further agree that, in compliance with the Employment,
Confidential Information and Invention Assignment Agreement, I will preserve as
confidential all trade secrets, confidential knowledge, data or other
proprietary information relating to products, processes, know-how, designs,
formulas, developmental or experimental work, computer programs data bases,
other original works of authorship, customer lists, business plans, financial
information or other subject matter pertaining to any business of the Company or
any of its employees, clients, consultants or licensees.
I further agree that for a period of twelve (12) months
immediately following the termination of my relationship with the Company, I
shall not either directly or indirectly solicit, induce, recruit or encourage
any of the Company's employees to leave their employment, or take away such
employees, or attempt to solicit, induce, recruit, encourage or take away
employees of the Company, either for myself or for any other person or entity.
-------------------------------------
Date:
-------------------------------------
Signature
-------------------------------------
Name of Employee (typed or printed)
(J. Xxx Xxxxx)
-14-
EXHIBIT D
CONFLICT OF INTEREST GUIDELINES
It is the policy of DigitalThink, Inc. (the "Company") to
conduct its affairs in strict compliance with the letter and spirit of the law
and to adhere to the highest principles of business ethics. Accordingly, all
officers, employees, and independent contractors must avoid activities which are
in conflict, or give the appearance of being in conflict, with these principles
and with the interests of the Company. The following are potentially
compromising situations which must be avoided. Any exceptions must be reported
to the President and written approval for continuation must be obtained.
1. Revealing confidential information to outsiders or misusing
confidential information. Unauthorized divulging of information is a violation
of this policy whether or not for personal gain and whether or not harm to the
Company is intended. (The Employment, Confidential Information and Invention
Assignment Agreement elaborates on this principle and is a binding agreement.)
2. Accepting or offering substantial gifts, excessive
entertainment, favors or payments which may be deemed to constitute undue
influence or otherwise be improper or embarrassing to the Company.
3. Participating in civic or professional organizations that
might involve divulging confidential information of the Company.
4. Initiating or approving personnel actions affecting reward
or punishment of employees or applicants where there is a family relationship or
is or appears to be a personal or social involvement.
5. Initiating or approving any form of personal or social
harassment of employees.
6. Investing or holding outside directorships in suppliers,
customers or competing companies, including financial speculation, where such
investment or directorship might influence in any manner a decision or course of
action of the Company.
7. Borrowing from or lending to employees, customers or
suppliers.
8. Acquiring real estate of interest to the Company.
9. Improperly using or disclosing to the Company any
proprietary information or trade secrets of any former or concurrent employer or
other person or entity with whom obligations of confidentiality exist.
10. Unlawfully discussing prices, costs, customers, sales or
markets with competing companies or their employees.
11. Making any unlawful agreements with distributors with
respect to prices.
12. Improperly using or authorizing the use of any inventions
which are the subject of patent claims of any other person or entity.
13. Engaging in any conduct which is not in the best interest
of the Company.
Each officer, employee and independent contractor must take
every necessary action to ensure compliance with these guidelines and to bring
problem areas to the attention of higher management for review. Violations of
the conflict of interest policy may result in discharge without warning.
-15-
