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EXHIBIT 10.35
EMPLOYMENT AGREEMENT
This Agreement, dated as of the 8th day of January, 1998, is between
SystemSoft Corporation, a Delaware Corporation having its principal place of
business at Xxx Xxxxxxxxxx Xxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 (the
"Corporation"), and Xxxxxxxx Xxxxxx, (the "Employee").
The Corporation desires to employ the Employee, and the Employee desires
to be so employed, upon the terms and conditions of this Agreement. Therefore,
the Corporation and the Employee agree as follows:
1. Term: Duties. The Corporation hereby employs the Employee and the
Employee thereby accepts employment with the Corporation, upon the terms and
subject to the conditions set forth in this Agreement. During the term of such
employment, the Employee shall (a) devote substantially all of his business time
and energy to performing his duties pursuant to this Agreement, (b) perform all
duties as the board of directors or any officer of the Corporation shall from
time to time direct, (c) perform such duties in a faithful manner and to the
best of his ability and (d) use his best efforts to promote the interests of the
Corporation. The corporation recognizes that the employee may be invited to
serve on boards of companies and/or industry associations and supports this
activity insofar as it does not represent a conflict of interest to the
Corporation.
2. Salary; Fringe Benefits. The Corporation shall pay to the Employee a
base salary of $175,000 per year ("Base Salary", which may be increased from
time to time in writing), payable in at least equal monthly payments during the
term of his employment by the Corporation, the specific payment terms of which
shall be determined by the Corporation. The Corporation may deduct from the
Employee's Base Salary all amounts which are required or permitted to be so
deducted under applicable law (including, but not limited to, Social Security
contributions and income tax withholdings).
The Employee shall be entitled to vacations and any other fringe
benefits during the term of his employment per corporate policy. The Employee
may only take vacations at times mutually agreed upon by the Corporation and the
Employee. Normal vacation planning and scheduling will not be unreasonably
withheld.
The Employee may be entitled to receive bonuses based on fifty percent
(50%) of his Base Salary if 100% goal attainment is achieved. The Employee may
be entitled to increases in his Base Salary. The determination of the amount of
such increases in Base Salary, if any, and the time and method of payment of
such increases shall be at the sole discretion of the board of directors of the
Corporation.
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The Employee may exercise any stock options granted to the employee at
any time regardless of whether the options have vested. Until such options have
vested in accordance with the terms of the stock option grant, SystemSoft shall
have the right to purchase the shares of stock issued pursuant to the exercise
of the grant at the price paid by the Employee.
3. Reimbursement for Expenses. The Corporation shall reimburse the
Employee for expenses which the Employee may from time to time reasonably incur
on behalf of or at the request of the Corporation in the performance of his
duties pursuant to this Agreement, provided that the Employee shall be required
to account to the Corporation for such expenses in the manner prescribed by the
Corporation.
4. Termination / Change of Control / Reduction in Job Function.
(a) Voluntary Termination. The Employee may terminate this Agreement
at any time upon notice to the Corporation.
(b) Involuntary Termination. The Corporation shall have the authority
to terminate this Agreement immediately (i) for Cause (as defined below) or (ii)
without Cause.
"Cause" shall mean the Employee's: (i) material failure or refusal to
perform and discharge his duties and responsibilities of his employment, or
willful action that is materially inconsistent with the terms of his employment;
(ii) material breach of his fiduciary duties as an officer or member of the
board of directors of the Corporation or any subsidiary or affiliate; (iii)
commission of an act that would constitute a felony; (iv) commission of any
other act involving the personal dishonesty or moral turpitude of the Employee;
or (v) material breach of any provision of this Agreement.
(c) Severance Payments. In the event of an involuntary termination of
the Employee's employment without Cause pursuant to subsection (b)(ii) above,
the Employee shall receive, for a period of twelve (12) months immediately
following his involuntary termination, (a) payments at the rate of 100% of his
Base Salary, plus incentive bonus payments, (as though 100% of goals were
attained) and all such payments to be made in the same manner as Base Salary and
bonus payments during his employment. The severance payments pursuant to Section
4(c) shall continue during such one year period even if the Employee accepts
employment with another employer. However, notwithstanding anything to the
contrary contained in Section 4(c), all such severance payments shall
immediately cease if the Employee violates any of the restrictive covenants set
forth in his Agreement, including, but not limited to, the provisions of
Sections 5, 6, 7, 8 or 9.
(d) During the period of severance payments, the Company will
continue to pay the employee's health insurance under the
standard policies maintained by the company.
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(e) During the period of severance payments, the stock options
granted to you shall continue to vest over that period and
any repricing of options by the Company will be applicable
to you.
(f) Change in Control. In the event of a change in control of the
Corporation, all options granted to the Employee pursuant to the Corporation's
Employee Stock Option Plan shall immediately vest. "Change of Control" of the
Corporation is deemed to have occurred if more than 20% of the voting shares
outstanding are held by any one individual or corporation.
(g) Reduction in Job Function. In the event that the Employee's job
function is significantly reduced or his salary plus bonus is reduced, it will
be deemed that he has been involuntarily terminated without cause. He will be
entitled to severance payments and health insurance as outlined in paragraphs 4
(c) and (d), and all options granted to the Employee under the Corporation's
Employee Stock Option Plan shall immediately vest.
5. Confidentiality. The Employee shall take all reasonable precautions to
safeguard the confidential nature of all Confidential Information (as
thereinafter defined) and shall take any other precautions with respect thereto
which the Corporation, in its sole discretion, may request. Without limiting the
generality of the foregoing, the Employee shall not at any time, directly or
indirectly, for his own account or on behalf of any individual, corporation,
partnership, governmental body or other entity (a "Person"), whether before or
after the termination of his employment with the Corporation, (a) sell, license,
transfer, disclose or otherwise make available any Confidential Information to
any other Person, (b) publish, market, license or otherwise use any Confidential
Information other than for the precise purpose for which its use has been
authorized by the Corporation or (c) reproduce or otherwise copy any
Confidential Information other than as required in performing his duties as an
employee of the Corporation; provided, however, that the Employee may do any of
the foregoing with respect to any Confidential Information (a) that is or
becomes publicly known through no action of the Employee or any other Person
having a duty of confidentiality with respect to such Confidential Information
or (b) pursuant to an order of any governmental authority, so long as prompt
notice is given to the Corporation.
For purposes of this Agreement, Confidential Information shall mean any
information relating to the business, assets, products or services of the
Corporation that is not generally available to the public, including, without
limitation, technology, inventions, research, technical know-how and data,
discoveries, production information, methods and processes, financial
information and cost data, trade secrets, business strategies, marketing and
sales techniques and information including information as to customers, customer
lists and suppliers, and all documents, drawings, plans, proposals, records,
blueprints, computer hardware designs, specifications, schematics, models,
computer software programs, program source codes or algorithms, computer
diskettes or other magnetic media, memoranda, manuals, articles, advertisements
or any other tangible item (each a "Tangible Item") containing or relating to
such information. "Confidential Information" shall also include all "Work
Product" of the Employee, as defined in Section 9 of this Agreement.
6. Personal Property. All Confidential Information disclosed by the
Corporation to the Employee, learned by the Employee at any time, or created by
the Employee, shall at all
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times remain the personal property of the Corporation, and each Tangible Item
supplied to the Employee which constitutes Confidential Information shall,
together with all copies thereof, be returned to the Corporation immediately
upon the earlier of a demand by the Corporation or termination of the Employee's
employment pursuant to Section 4 of this Agreement.
7. No Competition. During the term of the Employee's employment by the
Corporation, and for a period of one (1) year following the termination of such
employment, the Employee shall not, directly or indirectly, for his own account
or on behalf of any other Person, anywhere in the world, engage in substantially
the same present or reasonably anticipated future business as the company
(except that the Employee may own non-voting shares, and not more than 10% of
the voting shares, of any publicly-traded corporation engaged in such business
activity). The Employee expressly acknowledges that because of the nature of the
Corporation's business and the locations of the Corporation's customers, placing
a more limited geographic scope on the Employee's obligations under Section 7
would render those obligations effectively meaningless, and that the worldwide
scope of those obligations is therefore reasonable.
A violation by the Employee of the non-competition covenant set forth in
this Section shall entitle the Corporation to terminate any remaining severance
payments pursuant to Section 4(c) of this Agreement and seek any other remedy
pursuant to his Agreement or applicable law.
8. No Solicitation.
(a) During the term of the Employee's employment by the Corporation, and
for a period of one (1) year following the termination of such employment, the
Employee shall not, directly or indirectly, for his own account or on behalf of
any other Person, (a) employ or solicit the employment of any Person who is, or
during the 120 days immediately preceding the termination of such employment
was, an employee of the Corporation or any affiliate of the Corporation, (b)
influence or seek to influence any employee of the Corporation to leave the
Corporation's employment or (c) contact (except pursuant to the Employee's
duties on behalf of the Corporation during his employment) any employee of the
Corporation with respect to any business matter of the Corporation. The
Corporation will not hold the Employee accountable for inadvertant hires; those
that may be done by someone in another part of his new employer's company with
no involvement or knowledge on his part.
(b) During the term of the Employee's employment by the Corporation, and
for a period of one (1) year following the termination of such employment, the
Employee shall not, directly or indirectly, for his own account or on behalf of
any other Person, (a) sell or attempt to sell any products or services
competitive with the Corporation's products or services to any customer to whom
the Corporation sold products or services at any time during the last one (1)
year of the Employee's employment with the Corporation or (b) suggest, advise or
attempt to persuade any such customer to limit or discontinue its business with
the Corporation. The foregoing restrictions shall apply to (a) all such
customers of the Corporation located in any defined territory or territories to
which the Employee was assigned at any time during the last one (1) year of his
employment with the Corporation and (b) any of the Corporation's customers with
which or with whom the Employee dealt or whose account or business he
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managed, supervised, or conducted, alone or with any other Person, on behalf of
the Corporation at any time during the last one (1) year of his employment.
9. Work Product. Each discovery, idea, invention, formula, process, program
and other work product (including, but not limited to, any such discovery, idea,
invention, formula, process, program and work product that is protectable as a
copyright, patent or trademark) developed by the Employee, either alone or in
conjunction with any other Person, during the term of his employment by the
Corporation (a) which results from, relates to or is suggested by the actual or
demonstrably anticipated business or research and development of the
Corporation, regardless of where performed or conceived, or (b) for which the
Corporation's equipment, supplies, facilities or other information or materials
are or were used, and each Tangible Item relating to such discovery, idea,
invention, formula, process, program or other work product (collectively "Work
Product") shall be (a) promptly disclosed by the Employee to the Corporation and
(b) the exclusive property of the Corporation. To the extent applicable law
provides that any Work Product belongs to the Employee rather than the
Corporation notwithstanding the preceding sentence, the Employee grants to the
Corporation a non-exclusive and perpetual license to use such Work Product for
no consideration other than that which is given in connection with this
Agreement. The Employee shall execute each document, instrument and other
writing, and shall take each other action, requested by the Corporation
(including, but not limited to, preparing or assisting in the preparation of any
patent, copyright or trademark application) in order to assist the Corporation
in securing or protecting its interest in any such Work Product.
10. Equitable Remedies. The Employee (a) acknowledges that his failure to
comply with any provision of Sections 5, 6, 7, 8 or 9 of will cause the
Corporation irreparable harm and that a remedy at law for such a failure would
be an inadequate remedy for the Corporation and (b) consents to the
Corporation's obtaining from a court having jurisdiction specific performance,
an injunction, a restraining order or any other equitable relief appropriate to
enforce such compliance. The Corporation's right to obtain such equitable relief
shall be in addition to, and not in lieu of, any other remedy to which the
Corporation is entitled under applicable law (including, but not limited to,
monetary damages).
11. Failure, Delay or Waiver. No failure of the Corporation to require, and
no delay by the Corporation in requiring, the Employee to comply with any
provision of his Agreement shall constitute a waiver of the right to require
such compliance. No failure of the Corporation to exercise, and no delay by the
Corporation in exercising, any right or remedy under his Agreement shall
constitute a waiver of such right or remedy. No waiver by the Corporation of any
right or remedy under his Agreement shall be effective unless made in writing.
Any waiver by the Corporation of any right or remedy under his Agreement shall
be limited to the specific instance and shall not constitute a waiver of such
right or remedy in the future.
12. Severability. The Employee understands and acknowledges that his
Agreement is not intended to prevent him, after the termination of his
employment with the Corporation, from engaging in any business or accepting any
other employment, so long as, in connection therewith, the Employee does not
breach any of his obligations under his Agreement, and that the covenants and
the territorial, time and other limitations contained in his Agreement are
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necessary for the growth and stability of the Corporation and for the protection
of its legitimate business interests and are reasonable in scope and content. In
the event that any such covenant or territorial, time or other limitation is
found to be unreasonable by a court of competent jurisdiction, the Employee
agrees (a) that such court may modify the unreasonable covenant or limitation so
as to make it reasonable and, as so modified, such covenant or limitation shall
be binding upon his, and (b) that all of the other provisions of this Agreement
shall remain binding upon him. Subject to the foregoing sentence, in the event
that any provision of his Agreement shall be deemed to be invalid or
unenforceable under applicable law by a court of competent jurisdiction, such
invalidity or unenforceability shall only apply to such provision and shall not
affect any other provision of this Agreement.
13. Notices. All notices and other communications given pursuant to this
Agreement shall be deemed to have been properly given if hand delivered or if
mailed by certified mail, postage prepaid, addressed to the appropriate party,
at the address for such party set forth therein. Any party may from time to time
designate by written notice given pursuant to his Article 13 any other address
or party to which any such notice or communication or copies thereof shall be
sent.
14. Miscellaneous. This Agreement (a) may not be amended orally or by any
course of conduct pursued by the Corporation or the Employee, but may be amended
only by a written agreement duly executed by the Corporation and the Employee,
(b) is binding upon the Employee and each of his successors and assignees and
inures to the benefit of the Corporation and each of its successors and
assignees, except that the Employee may not assign any of his rights or
obligations pursuant to this Agreement without first obtaining the written
consent of the Corporation, (c) constitutes the entire agreement between the
Corporation and the employee with respect to the subject matter of this
Agreement, and supersedes all oral and written proposals, representations,
understandings and agreements previously made or existing with respect to such
subject matter and (d) shall be governed by, and interpreted and construed in
accordance with, the laws of The Commonwealth of Massachusetts, without regard
to principles of conflicts of law.
(Remainder of the Page Left Intentionally Blank)
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As conclusive evidence of his acceptance of the terms and conditions of her
Agreement, the Corporation and the Employee have executed this Agreement on the
day and year indicated above.
SYSTEMSOFT CORPORATION
By:/s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
CEO and Chairman of the Board
EMPLOYEE:
/s/ Xxxxxxxx Xxxxxx
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Signature
Xxxxxxxx Xxxxxx
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Name (please print)
Xxxxxx, Mass
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Address
