EXHIBIT 10.15
FORM OF
NONCOMPETITION AGREEMENT
This NONCOMPETITION AGREEMENT (this "Agreement"), dated as of July 10,
1998, is between ,an individual ("Employee"), and Xxxx.xxx Inc., a
Delaware corporation (the "Company").
PRELIMINARY STATEMENTS:
A. The Company and its affiliates are in the business of electronic
commerce transactions involving the sale of periodicals, research
reports and subscriptions of such materials (the "Business");
B. The Company is issuing shares of its Class B Preferred Shares, $. par
value, at a price of $ per share to certain investors (the
"Investors") pursuant to a stock Purchase Agreement dated as of May 4,
1998 (the " Stock Purchase Agreement").
C. Employee is an employee of the Company, owning ____% of the Company's
capital stock prior to the Investors' investment in the Company on a
fully- diluted basis.
D. One of the conditions to the investment by the Investor is the
execution of this Agreement by Employee.
NOW, THEREFORE, in consideration and as a condition of Employee's employment by
the company, the investment by the Investors under the Stock Purchase Agreement,
and the mutual covenants and agreement contained herein, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound
hereby, parties hereto agree as follows:
1) DEFINITIONS. The following terms, when capitalized, shall have the meanings
set forth below:
BOARD- shall mean the Board of Directors of the Company.
BUSINESS- shall have the meaning provided in the Recitals to this
Agreement.
CAUSE- shall mean (I) any act or acts by Employee resulting directly or
indirectly in, or intended to result directly or indirectly in, material
gain or personal enrichment to Employee or any third party at the expense
of the Company; (ii) the willful, wanton or reckless failure by Employee to
properly perform his duties with the Company (other than any such failure
resulting from incapacity due to mental or physical illness); (iii)
Employee's indictment for a felony or (iv) Employee's breach of Section 5
or Section 6 of this Agreement. Employee's employment shall in no event be
considered to have been terminated by the Company for cause if such
termination took place as the result of bad judgement or ordinary
negligence.
CONFIDENTIAL INFORMATION- shall mean information that, although not a Trade
Secret, is not generally known and includes, but is not limited to, sales
and marketing information, customer account records, training and
operations materials and memoranda, personnel records, pricing and
financial information relating to the business, accounts, customers,
employees and affairs of the Company or of its affiliates; any information
marked "Confidential" by the Company or by its affiliates; and any other
similar information that is not a Trade Secret.
GOOD REASON- shall mean Employee's duties are Negatively Altered.
NEGATIVELY ALTERED- shall mean if any of the following shall occur without
Employee's express written consent: (i) the assignment to Employee of any
duties materially inconsistent with Employee's position, duties,
responsibilities and status with the Company (other than promotions) or a
material adverse change
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in Employee to move his residence more than 100 miles; or (iii) the failure
by the Company to continue to provide Employee with employee benefits that
are comparable to employees of a similar status.
NONCOMPETITION PERIOD- shall mean the period of time consisting of the term
of Employee's employment with the Company and a period of twelve (12)
months following the termination of Employee's employment hereunder for any
reason by the Company or by Employee.
SERVICES- shall have the meaning described in Section 2.
TERRITORY- shall mean the United States, Canada and in any other country
where the Company has generated revenue.
TRADE SECRET- shall mean (i) any scientific or technical information,
program, software, design, process, procedure, formula, invention or
improvement that is secret and of value and (ii) information including, but
not limited to, technical or nontechnical data, formula patterns,
compilations, programs, software, devices, methods, techniques, drawings,
processes, financial data and lists of actual or potential customers which
the Company or its affiliates takes reasonable efforts to protect from
disclosure.
2) EMPLOYMENT AT WILL. Employee shall continue to be employed by the Company on
an " at will" basis and Employee's employment shall continue for such time as
the Company is in need of, or desirous of, the services of Employee. It is
expressly understood and agreed between the Company and Employee that the
duration of Employee's employment is unspecified and results in the sole
discretion of the Company.
3) DUTIES. Employee shall devote his full business time and efforts solely to
the business and interest of the Company. During the term of this Agreement,
Employee shall not engage in any activity which would be inconsistent with
such duties or with the objectives and business of the Company and shall
diligently perform his obligations and discharge his duties under this
Agreement. Employee shall adhere to all ethical practices and other rules and
regulations established by the Company.
4) SEVERANCE.
(A) If (i) the Company terminates Employee's employment with the
Company for any reason other than Cause or (ii) Employee voluntarily
terminates his employment with the Company for Good Reason, the
Company shall pay Employee during each month of the Noncompetition
Period and amount equal to two-thirds of Employee's monthly salary in
effect at the time of such termination; provided, however, that the
Company may elect not to make severance payments to Employee or to
cease making such severance payments at any time during the
Noncompetition Period, in which event Employee's obligations under
Section 5 shall terminate. If employee is employed by a third party
after the termination of his employment with the Company and prior to
the end of the Noncompetition Period, the Company shall be entitled to
deduct from Employee's monthly severance payments an amount equal to
Employee's monthly salary (including all other cash compensation)
received from such third party employer.
(B) If (i) the Company terminates Employee's employment with the
Company for Cause or (ii) Employee voluntarily terminates his
employment with the Company other than for Goof Reason, the Company
shall not be obligated to make any severance payments to Employee and
Employee shall only be entitled to receive his salary earned, pro
rata, up to and including the date of any such termination.
5) NONCOMPETITION & PROPRIETARY INFORMATION.
(A) During the Noncompetition Period, Employee shall not, directly or
indirectly, either individually, in partnership, jointly, or in
conjunction with any person, firm, partnership, limited liability
company, corporation, or unincorporated association of any kind,
whether as principal, agent, shareholder, employee, or in any other
capacity whatsoever:
(I) engage in any business in the Territory which competes
with the Business;
(II) solicit or contact potential customers on behalf of,
invest in, obtain any interest, in, advise, lend money to,
or guarantee the debts or obligations of any person, firm,
partnership,
limited liability company, corporation, or unincorporated
association of any kind, which is engaged in the Territory
in any business which competes with the Business;
(III) solicit or accept business from any of the Company's or
its affiliates customers or actively sought prospective
customers, for the purposes of providing products or
services in the Territory which are the same as or
substantially similar to those provided by the Company in
connection with its conduct of the Business; or
(IV) persuade or attempt to persuade any employee of the
Company or its affiliates to terminate his or her service
with the Company or with such affiliates.
(B) During Employee's employment with the Company and thereafter, Employee
shall not use, reveal or divulge any Trade Secrets or Confidential
Information relating to the Business. Notwithstanding the foregoing,
Employee shall not be subject to the restrictions set forth in this
Section 5 with respect to information which:
(I) becomes generally available to the public other than as a
result of disclosure by Employee or his agents or
representatives;
(II) becomes available to Employee on a non-confidential basis
from a source other than the Company or its agents,
provided that such source lawfully obtained such
information and is not bound by a confidentiality
obligation not to disclosure such information; or
(III) is required to be disclosed by law.
6) ASSIGNMENT OF INVENTIONS & RETURN OF COMPANY DOCUMENTS.
(A) Employee shall promptly make full written disclosure to the Company,
shall hold in trust for the sole right and benefit of the Company, and
hereby assigns to the Company, or its designee, all of Employee's
right, title and interest in and to any and all inventions,, original
works of authorship, developments, concepts, improvements, designs,
discoveries, ideas, trademarks or trade secrets, whether or not
patentable or registrable under copyright or similar laws which
Employee may solely or jointly conceive or develop or reduce to
practice, or cause to be conceived or developed or reduce to practice,
within the scope and during the period of time of Employee's
employment with the Company ( collectively referred to as
"Inventions"). Employee hereby also assigns to the Company, or its
designee, all of Employee's rights, title and interest and to any and
all Inventions, which Employee solely or jointly conceived or
developed or reduced to practice, or caused to be developed or reduced
to practice, within the scope and during Employee's employment with
the Company prior to the date of this Agreement. Employee further
acknowledges that all original works of authorship which are made or
were made by Employee (solely or jointly with others) within the scope
of and during the period of Employee's employment with the Company
prior to and after the date of this Agreement and which are
protectable by copyright are "works made for hire," as that term is
defined in the United States Copyright Act. Employee understands and
agrees that the decision whether or not to commercialize or market any
invention developed by Employee solely or jointly with others is
within the Company's sole discretion and for the Company's sole
benefit and that no royalty shall be due to Employee as a result of
the Company's efforts to commercialize or market any such invention.
(B) Employee shall keep and maintain adequate and current written records
of all Inventions made by Employee (solely or jointly with others)
during the term of his employment with the Company. Employee shall
keep such records in the form of notes, sketches, drawings, and any
other format that may be specified by the Company. The Records shall
be available to and remain the sole property of the Company at all
times.
(C) Employee shall assist the Company, or its designee, at the Company's
expense, in every proper way reasonably necessary to secure the
Company's rights in the Inventions and any copyrights, patents 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 to such Inventions, and any copyrights, patents or
other intellectual property rights relating thereto. Employee further
agrees that such obligations to executed or cause to be executed, when
it is in Employee's power to do so, any such instrument or papers at
the Company's expense shall continue after the termination of this
Agreement. If the Company is unable because of the mental or physical
incapacity of Employee's 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 pursuant to this Agreement, then Employee
hereby irrevocably designates and appoints the Company and its duly
authorized officers and agents as Employee's agent and attorney in
fact to act for and in Employee's behalf and stead to execute and file
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 Employee.
(D) Upon termination of Employee's employment with the Company, Employee
shall deliver to the Company ( and shall not keep in his possession,
recreate or deliver to anyone else ) any and all devices, records
data, notes, reports, proposals, lists, correspondence, specification,
drawings, blueprints, sketches, materials, equipment, other documents
or property, or reproductions of any aforementioned items developed by
Employee pursuant to Employee's employment with the Company or
otherwise belonging to the Company, its successors or assigns
7) REMEDIES. Employee acknowledges and agrees that the Company would suffer
irreparable harm from a breach by Employee of the restrictive covenants set
forth in Section 5 or 6. Therefore, in the event of the actual or threatened
breach by Employee under Section 5 or 6, the Company any, in additional and
supplementary to any other rights and remedies existing in its favor
(including, without limitation, its right to terminate Employee's
employment), apply to any court of law or equity of competent jurisdiction
for specific performance or injunctive or other relief in order to enforce
or prevent any violation of the provisions of Section 5 or 6. Employee
agrees not to raise the defense of an adequate remedy at law in any such
proceeding. Employee agrees that the existence of any claim or cause of
action by Employee against the company, whether predicated upon this
Agreement or any other contact, shall not constitute a defense to the
enforcement by the Company of the provisions of Section 5 or 6.
8) NOTICE. All notices and other communications required under this Agreement
shall be deemed to have been duly given and made if in writing and if served
either by personal delivery to the party for whom intended ( which shall
include delivery by Federal Express or similar service) or three (3)
business days after being deposited, postage prepaid, certified or
registered mail, return receipt requested, in the United States mail bearing
the address shown in this Agreement for, or such other address as may be
designated in writing hereafter by, such party:
If to Employee: [Name and Address of
Employee]
If to the Company: RoweCom Inc.
000 Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
XXX
9) REFORMATION & SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is finally
determined by a court of competent jurisdiction to be unenforceable or
invalid under applicable law, such provisions shall be effective only to the
extent of this enforceability or validity, without affecting the
enforceability or validity of the remainder of this Agreement, and such
court shall have jurisdiction to reform this Agreement to the maximum extent
permitted by law. In the event that any such provision of this Agreement
cannot be reformed, such provision shall be deemed severed from this
Agreement, but every other provision of this Agreement shall remain in full
force and effect.
10) Binding Effect & Waiver. The terms and provisions of this Agreement shall
be binding on and inure to the benefit of Employee, his heirs, executors,
administrators, and other legal representatives and shall be binding on and
inure to the benefit of the Company, its affiliates, successors or assigns.
The failure of the Company at any
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time or from time to time to require performance of any of Employee's
obligations under this Agreement shall in no manner affect the Company's
right to enforce any provision of this Agreement at a subsequent time, and
the waiver of any rights arising out of any subsequent or prior breach.
11) ENTIRE AGREEMENT. This Agreement constitutes the entire agreement and
understanding between Employee and the Company with respect to the subject
matter hereof, and supersedes all prior agreements and understandings
relating to the subject matter hereof.
12) AMENDMENT. No amendment, modification, or waiver of any provision of this
Agreement, or consent to any departure by Employee therefrom, shall be
effective unless the same shall be in writing and signed by the parties
hereto.
13) ASSIGNMENT. This Agreement is for personal services to be performed by
Employee and may not be assigned or transferred by Employee, or the
obligations of Employee performed by any other party. All of the rights and
obligations of the Company under this Agreement are fully assignable and
transferable by the Company.
14) COUNTERPARTS. This Agreement may be executed in counterparts, each of which
shall be deemed an original but all of which together shall constitute one
and the same instrument.
15) HEADINGS. The various headings of this Agreement are inserted for
convenience only and shall not affect the meaning of interpretation of this
Agreement or provisions hereof.
16) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Massachusetts.
EMPLOYEE:
___________________________________
Employee Signature and Date
COMPANY:
Xxxx.xxx Inc., a Delaware Corporation
Witnessed by:
Signature:_________________________________ Title:_____________________________
Print Name:________________________________
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