Exhibit 10.10
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT, (this "Agreement") dated as of December 27,
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1996, is between Erol's Internet, Inc., a Delaware corporation (the "Company"),
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and Xxxxx Xxxxxx (the "Executive"). In consideration of the mutual covenants
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and representations herein contained and the mutual benefits derived herefrom,
the parties, intending to be legally bound, covenant and agree as follows:
1. Purpose. The Company is engaged in providing internet services
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to the public (the "Business"). The Company wishes to employ the Executive, and
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the Executive has agreed to be employed by the Company, on the terms and
conditions herein provided.
2. Full-Time Employment of Executive - Duties and Status.
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(a) The Company hereby engages the Executive as a full-time
executive employee in the position of President -- Sales, Marketing and Business
Development, reporting directly to the CEO, for the period (the "Employment
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Period") specified in Section 4(a) hereof, and the Executive accepts such
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employment, on the terms and conditions set forth in this Agreement. Throughout
the Employment Period, the Executive shall faithfully and competently exercise
such authority and perform such executive duties as are commensurate with the
authority and duties of a Senior Executive of the Company and such other
reasonable duties as may otherwise be assigned to him from time to time by the
Company.
(b) Throughout the Employment Period, the Executive shall (i)
devote ninety-five percent (95%) of his full time and efforts to the business of
the Company and shall not engage in consulting work or any trade or business for
his own account or for or on behalf of any other person, firm or corporation
which competes, conflicts or interferes with the performance of his duties
hereunder in any way, and (ii) accept such additional position or positions to
which the Executive may be appointed by the Company, provided that the
performance of the duties of such office or offices shall generally be
consistent with the scope of the duties provided for in Section 2(a) hereof.
(c) The Executive agrees to execute the Employee Proprietary
Information and Inventions Agreement (the "Proprietary Rights Agreement"),
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attached hereto as Exhibit A, and to comply with the provisions thereof. The
Executive understands that both entering into and complying with the terms of
the Proprietary Rights Agreement is a condition to the Executive's continued
employment with the Company and that failure to comply with the terms of the
Proprietary Rights Agreement will constitute "cause" for purposes of this
Agreement. The Executive further represents
and warrants that his employment by the Company, and the performance by the
Executive of his duties hereunder, will not violate any of the terms and
conditions of any agreement with a previous employer or any legal right of any
previous employer.
3. Compensation and General Benefits. As full compensation for
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services provided to the Company, the Executive shall, during the Employment
Period, be compensated as follows:
(a) The Company shall pay to the Executive a salary (the
"Salary") based upon a per annum rate of $142,500. The Salary shall be payable
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in periodic equal installments not less frequently than monthly, less such sums
as may be required to be deducted or withheld under applicable provisions of
federal, state and local law, plus increases in the Salary, if any, as may be
approved from time to time by the Compensation Committee in its discretion.
(b) At least annually, the Executive's Performance shall be
evaluated in an annual performance review (the "Performance Review"). The
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results of the Performance Review shall be provided to both the Executive and to
the Compensation Committee or its designees.
(c) Throughout the Employment Period, the Executive shall be
entitled to participate in such benefits plans of the Company or additional
benefit programs established by the Company as determined in the discretion of
the Compensation Committee commensurate with the Executive's level of
responsibility within the Company.
(d) Throughout the Employment Period, the Executive shall be
entitled to (i) two weeks of annual vacation, (ii) leaves of absence, and (iii)
leaves for illness or temporary disability in accordance with the policies of
the Company in effect from time to time for its executive officers. Vacation
leaves and leaves of absence, if taken by the Executive, shall be taken at such
times as are reasonably acceptable to the Company. Any leaves on account of
illness or temporary disability which is short of Total Disability (as defined
in Section 4(d)(ii) hereof) shall not constitute a breach by the Executive of
his agreements hereunder even though leaves on account of a Total Disability may
be deemed to result in a termination of the Employment Period under the
applicable provisions of this Agreement.
(e) The Executive shall perform his services at the corporate
headquarters office of the Company located in Springfield, Virginia, or at such
other office established by the Company within 100 miles of said corporate
headquarters.
(f) The Company shall reimburse the Executive from time to time
for all reasonable and customary business expenses incurred by him in the
performance of his duties hereunder, provided that the Executive shall submit
vouchers
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and other supporting data to substantiate the amount of said expenses in
accordance with Company policy from time to time in effect.
(g) If the Company purchases and maintains at any time during
the term of this Agreement one or more life insurance policies on the life of
the Executive, in addition to any policies purchased pursuant to Section 3(c)
hereof, in whatever amount or amounts which the Company, in its discretion,
deems desirable, the Company shall be the beneficiary of said policy or policies
and the Executive shall cooperate with the Company and submit to such reasonable
medical examinations as are necessary to enable the Company to purchase and
maintain in full force and effect such additional insurance policy or policies.
4. Employment Period.
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(a) Duration. The Employment Period shall commence on the date
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of this Agreement and shall continue until the earlier of (i) the close of
business on the day immediately preceding the one year anniversary of this
Agreement, or the anniversary date of any extension of this Agreement as
provided in Section 4(b) hereof, whichever later occurs (the "Expiration Date"),
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or (ii) termination of this Agreement by the Company with "cause" (as defined in
Section 4(d)(i) hereof), or (iii) termination of this Agreement by the Company
for any reason other than cause, or (iv) the Executive's resignation for "good
reason" (as defined in Section 4(d)(iii), or (v) the Executive's resignation
without "good reason", or (vi) the death or Total Disability of the Executive.
(b) Extension of Employment Period. On the one year anniversary
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of the date of this Agreement, and on each anniversary thereafter, the
Employment Period shall be extended for an additional year, at the rate of
compensation then in effect as determined pursuant to the provisions of Section
3(a) hereof, unless the Company or the Executive notifies the other in writing
at least ninety (90) days prior to such anniversary of its or his election not
to renew this Agreement.
(c) Payments Upon Termination.
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(i) If the Executive's employment is terminated by the
Company for any reason other than "cause" (as defined in Section 4(d)(i) hereof)
or by the Executive for "good reason" (as defined in Section 4(d)(iii) hereof)
at any time during the Employment Period or any extension thereof, the Company
shall pay to, or provide for, as the case may be, the Executive, for the
remainder of the Employment Period, at the times otherwise provided in this
Agreement as if the Executive had not been terminated:
(A) his Salary then in effect as accrued through the
date of termination and the longer of either (1) the remainder of the Employment
Period or (2) a period of three (3) months, which Salary shall be payable in
equal monthly installments during such period in accordance with existing
payroll policies; and
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(B) to the extent applicable, the sickness and health
insurance programs to which he would have been entitled under this Agreement if
he had remained in the employ of the Company for such period
(ii) The Executive shall use his best efforts to discharge
his legal obligation to mitigate the amount of payments provided for in this
Section 4(c) by actively seeking employment, and the amount of any payment
provided for in this Section 4(c) shall be reduced by any compensation or
remuneration earned or which should have been earned as the result of employment
by another employer after the date of termination and during such severance
period.
(iii) If the Executive's employment is terminated (A) by the
Company for "cause", or (B) by the Executive by resignation without "good
reason", or (C) upon the death or Total Disability of the Executive, then the
Company shall have no further liability to the Executive, except for the Salary
which has accrued through the date of termination, which amounts shall be paid
by the Company within thirty (30) days of such termination, or in accordance
with applicable law. If the Executive's employment is terminated due to his
death or his Total Disability, then, in addition to the Salary which has accrued
through the date of termination, the Executive or his estate shall receive the
Salary then in effect for a period of three (3) months after the date of
termination in equal monthly installments.
(iv) Notwithstanding any other provision of this Section
4(c), if the Executive violates any covenant, term or condition of this
Agreement or the Proprietary Rights Agreement, the Company shall be entitled, in
addition to any other remedies it may have hereunder or at law or in equity, to
offset the amount of any payment otherwise due to the Executive pursuant to this
Section 4(c) against any loss or damage incurred by the Company as a result of
the Executive's violation of said covenant, term or condition.
(d) Definitions. When used in this Agreement, the words
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"cause", "Total Disability" and "good reason" shall have the respective meanings
set forth below:
(i) The term "cause" means: (A) the Executive's failure to
perform his employment duties hereunder to the reasonable satisfaction of the
Company after reasonable notice to the Executive by the Company specifying such
failure and providing the Executive with a minimum of thirty (30) days to cure
such failure; (B) the Executive's breach of the covenants or agreements
contained in this Agreement, the Proprietary Rights Agreement, or any other
material agreement or undertaking of the Executive; (C) the Executive's
commission of a felony or any crime involving moral turpitude, fraud or
misrepresentation, whether or not related to the business or property of the
Company; (D) any act of the Executive against the Company intended to enrich the
Executive in derogation of his duties (including, but not limited to his duty of
loyalty) to the Company; (E) any willful or purposeful act or omission (or any
act or omission done
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in bad faith) or gross negligence of the Executive having the effect of injuring
the business or business relationships of the Company; or (F) the Executive's
discrimination, harassment, or retaliation in violation of applicable federal
state or local equal opportunity laws.
(ii) To the extent permitted by applicable law, the term
"Total Disability" means total disability as defined in the Company's group and
individual disability plans, if any. If the Company does not have in existence
such plans, then Total Disability shall mean:
(y) The inability to perform the duties required hereunder
for a continuous period of thirteen (13) weeks during the Employment Period due
to "mental incompetence" or "physical disability" as hereinafter defined. The
Executive shall be considered to be mentally incompetent and/or physically
disabled: (A) if the Executive is under a legal decree of incompetency (the date
of such decree being deemed the date on which such mental incompetence occurred
for purposes of this Section 4(d)); or (B) because of a "Medical Determination
of Mental and/or Physical Disability." A Medical Determination of Mental and/or
Physical Disability shall mean the written determination by: (1) the physician
regularly attending the Executive, and (2) a physician selected by the Company,
that because of a medically determinable mental and/or physical disability the
Executive is unable to perform any essential functions of the Executive, and
such mental and/or physical disability is determined or reasonably expected to
last thirteen (13) weeks or longer after the date of determination, based on
medically available information. If the two physicians do not agree, they shall
jointly choose a third consulting physician and the written opinion of the
majority of these three (3) physicians shall be conclusive as to such mental
and/or physical disability and shall be binding on the parties. The date of any
written opinion which is conclusive as to the mental and/or physical disability
shall be deemed the date on which such mental and/or physical disability
commenced for purposes of this Section 4(d), if the written opinion concludes
that the Executive is mentally and/or physically disabled. In conjunction with
determining mental and/or physical disability for purposes of this Agreement,
the Executive consents to any such examinations which are relevant to a
determination of whether the Executive is mentally and/or physically disabled,
and which is required by any two (2) of the aforesaid physicians, and to furnish
such medical information as may be reasonably requested, and to waive any
applicable physician patient privilege that may arise because of such
examination. All physicians selected hereunder shall be Board-certified in the
specialty most closely related to the nature of the mental and/or physical
disability alleged to exist.
(z) For purposes of determining whether the Executive is
mentally incompetent or physically disabled for the continuous thirteen (13)
week period specified in this Section 4(d), such disability shall be deemed to
continue from the date of any legal decree of incompetency, or written opinion
which is conclusive as to the mental and/or physical disability, through the
date the legal decree expires or is otherwise revoked or removed, or the date on
which the mental and/or physical disability has
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ceased, as the case may be, as set forth in a written opinion prepared by the
physicians described in this Section 4(d) pursuant to the procedures provided
herein.
(iii) The term "resignation for good reason" or "good
reason" means the following actions taken by the Company without the express
written consent of the Executive:
(A) the failure of the Company within ten (10) days
written notice by the Executive to the Chief Executive Officer (with a copy to
the Chairman of the Compensation Committee, if any), to make any payment due to
Executive hereunder;
(B) making any material change in the Executive's
duties not generally consistent with the Executive's scope of duties as set
forth in Section 2 hereof, which is not rescinded within thirty (30) days after
the Executive has given the Chief Executive Officer written notice of such
change;
(C) decreasing the Executive's salary, or causing a
material decrease in life or disability insurance coverage or benefits payable
to the Executive or to which the Executive is entitled other than as part of a
general decrease in benefits provided or payable to officers and other salaried
employees of the Company;
(D) requiring the Executive to be based at any office
or location more than fifty (50) miles from the office at which the Executive is
based on the date hereof, except for travel reasonably required in the
performance of the Executive's responsibilities;
(E) failing to comply (other than a failure to make
payments) with any of the material provisions of this Agreement, which change or
failure, as the case may be, continues unremedied for thirty (30) days after
Executive has given the Chief Executive Officer written notice of such change or
failure which notice specifies in detail the change or failure, as the case may
be.
5. Notices. Any notices, requests, demands and other communications
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provided for by this Agreement shall be sufficient if in writing and if sent by
registered or certified mail to the Executive at the last address the Executive
has filed in writing with the Company and if to the Company at:
Erol's Internet, Inc.
Attention: CEO
0000 Xxxxxxxx Xx.
Xxxxxxxxxxx, XX 00000
6. Binding Agreement; Assignment. This Agreement shall be effective
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as of the date hereof and shall be binding upon and inure to the benefit of, the
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parties and their respective heirs, successors, assigns, and personal
representatives, as the case may be. The Executive may not assign any rights or
delegate any duties under this Agreement. As used herein, the successors of the
Company shall include, but not be limited to, any successor by way of merger,
consolidation, sale of all or substantially all of the assets, or similar
reorganization or change in control.
7. Entire Agreement. This Agreement shall constitute the entire
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understanding of the Executive and the Company with respect to the subject
matter hereof and supersedes any and all prior understandings, representations
or promises written or oral concerning said subject matter. This Agreement may
not be changed, modified or discharged orally, but only by an instrument in
writing signed by the parties.
8. Enforceability. This Agreement has been duly authorized,
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executed and delivered and constitutes the valid and binding obligations of the
parties hereto, enforceable in accordance with its terms. The undertakings
herein shall not be construed as any limitation upon the remedies the Company
might, in the absence of this Agreement, have at law or in equity for any wrongs
of the Executive.
9. Governing Law. The validity and construction of this Agreement
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or any of its provisions shall be determined under the laws of the State of
Delaware, without giving effect to its conflicts of laws provisions, and without
regard to its place of execution or its place of performance. The parties
irrevocably consent and agree to the exclusive jurisdiction of the Circuit Court
for Fairfax County or the United States District Court for the Eastern District
of Virginia, except for matters arbitrated subject to section 10 hereof.
10. Arbitration. The Company and the Executive mutually covenant and
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agree that if any controversy or dispute relating to this Agreement arises
between them that cannot be resolved by negotiation, either party may, after
providing written notice to the other party, submit such dispute to arbitration
in Fairfax County, Virginia in accordance with the rules of the American
Arbitration Association then in effect unless the rules of another association
are mutually agreeable to the parties. The arbitrator appointed must be an
attorney or retired judge who has experience with the principle issues to be
arbitrated. Any reward or finding made pursuant to such arbitration shall in
all respects be well and fairly kept and observed and may be imposed by judgment
of the appropriate court in the Commonwealth of Virginia pursuant to the
applicable laws relating thereto. Each party shall bear his or its own costs in
connection with the arbitration, except that the cost of the arbitrator shall be
borne by the party that the arbitrator, in his sole discretion, determines has
not prevailed on a majority of the issues submitted to arbitration.
11. Severability. Except as provided in Section 4(e) hereof, if any
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one or more of the terms or provisions of this Agreement shall for any reason be
held to be invalid, illegal or unenforceable, in whole or in part, or in any
respect or in the event that any one or more of the provisions of this Agreement
operated or would prospectively
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operate to invalidate this Agreement, then and in either of those events, such
provision or provisions only shall be deemed null and void to the extent such
term or provision is held to be invalid, illegal or unenforceable and shall not
affect any other provision of this Agreement and the remaining provisions of
this Agreement shall remain operative and in full force and effect and shall in
no way be affected, prejudiced or disturbed thereby.
12. Counterparts. This Agreement may be executed in one or more
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counterparts, each of which shall be deemed an original, but all of which
together shall constitute one Agreement.
13. Amendments and Waivers. This Agreement may, to the maximum
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extent permitted by applicable law, be amended by the parties, which amendment
shall be set forth in an instrument executed by all of the parties. Any term,
provision or condition of this Agreement (other than as prohibited by applicable
law) may be waived in writing at any time by the party which is entitled to the
benefits thereof.
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement on the date first above written.
EROL'S INTERNET, INC.
By: /s/ Xxxxxx X. Xxxxx
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Its: President and CEO
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/s/ Xxxxx Xxxxxx
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Xxxxx Xxxxxx
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Exhibit A
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EROL'S INTERNET, INC.
EMPLOYEE PROPRIETARY INFORMATION AND
INVENTIONS AGREEMENT
THIS EMPLOYEE PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT dated
as of December, 1996, by and between EROL'S INTERNET INC., a Delaware
corporation (the "Company") and Xxxxx Xxxxxx, (the "Employee"). In consideration
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of the mutual covenants and representations herein contained and the mutual
benefits derived herefrom, the parties, intending to be legally bound, agree as
follows:
1. Nondisclosure.
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(a) At all times during employment and thereafter, the Employee
shall hold in strictest confidence and shall not disclose, use, lecture upon or
publish any of the Company's Proprietary Information (defined below), except as
such disclosure, use or publication may be required in connection with work for
the Company, or unless an officer of the Company expressly authorizes such in
writing. The Employee shall obtain Company's written approval before publishing
or submitting for publication any material (written, verbal, or otherwise) that
relates to his work at the Company and/or incorporates any Proprietary
Information. The Employee hereby assigns to the Company any rights the Employee
may have or acquire in such Proprietary Information and recognizes that all
Proprietary Information shall be the sole property of the Company and its
assigns.
(b) The term "Proprietary Information" shall mean any and all
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confidential and/or proprietary knowledge, data or information of the Company.
By way of illustration but not limitation, Proprietary Information includes (a)
trade secrets, inventions, mask works, ideas, processes, formulas, source and
object codes, data, programs, other works of authorship, know-how, improvements,
discoveries, developments, designs and techniques (hereinafter collectively
referred to as "Inventions"); and (b) information regarding plans for research,
development, new products, marketing and selling, business plans, budgets and
unpublished financial statements, licenses, prices and costs, suppliers and
customers; and (c) information regarding the skills and compensation of other
employees of the Company. Notwithstanding the foregoing, it is understood that,
at all such times, the Employee is free to use information that is generally
known in the trade or industry, which is not gained as result of a breach of
this Agreement, and his own, skill, knowledge, know-how and experience to
whatever extent and in whichever manner the Employee wishes.
(c) The Employee understand, in addition, that the Company has
received and in the future shall receive from third parties confidential or
proprietary information ("Third Party Information") subject to a duty on the
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Company's part to maintain the confidentiality of such information and to use it
only for certain limited purposes. During the term of employment and thereafter,
the Employee shall hold Third Party Information in the strictest confidence and
shall not disclose to anyone (other than Company personnel who need to know such
information in connection with their work for the Company) or use, except in
connection with his work for the Company, Third Party Information unless
expressly authorized by an officer of the Company in writing.
(d) During his employment by the Company the Employee shall not
improperly use or disclose any confidential information or trade secrets, if
any, of any former employer or any other person to whom the Employee has an
obligation of confidentiality, and the Employee shall not bring onto the
premises of the Company any unpublished documents or any property belonging to
any former employer or any other person to whom the Employee has an obligation
of confidentiality unless consented to in writing by that former employer or
person. The Employee shall use in the performance of his duties only information
which is generally known and used by persons with training and experience
comparable to the Employee's own, which is common knowledge in the industry or
is otherwise provided or developed by the Company.
2. Assignment of Inventions.
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(a) The term "Property Rights" shall mean all trade secret,
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trademark, patent, copyright, mask work and other intellectual property rights
throughout the world.
(b) Inventions, if any, patented or unpatented, which the
Employee made prior to the commencement of employment with the Company are
excluded from the scope of this Agreement. To preclude any possible uncertainty,
the Employee has set forth on Exhibit A (Previous Inventions) attached hereto a
complete list of all Inventions that the Employee has, alone or jointly with
others, conceived, developed or reduced to practice or caused to be conceived,
developed or reduced to practice prior to the commencement of employment with
the Company, that the Employee considers to be his property or the property of
third parties and that the Employee wishes to have excluded from the scope of
this Agreement (collectively referred to as "Prior Inventions"). If disclosure
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of any such Prior Invention would cause the Employee to violate any prior
confidentiality agreement, the Employee understand that the Employee is not to
list such Prior Invention in Exhibit A but am only to disclose a cursory name
for each such invention, a listing of the party(ies) to whom it belongs and the
fact that full disclosure as to such inventions has not been made for that
reason. A space is provided on Exhibit A for such purpose. If no such disclosure
is attached, the Employee represents that there are no Prior Inventions. If, in
the course of employment with the Company, the Employee incorporates a Prior
Invention into a Company product, process or machine, the Company is hereby
granted and shall have a nonexclusive,
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royalty-free, irrevocable, perpetual, worldwide license (with rights to
sublicense through multiple tiers of sublicensees) to make, have made, modify,
use and sell such Prior Invention. Notwithstanding the foregoing, the Employee
agrees that the Employee shall not incorporate, or permit to be incorporated,
Prior Inventions in any Company Inventions without the Company's prior written
consent.
(c) Subject to Sections 2(d), and 2(f), the Employee hereby
assigns and agrees to assign in the future (when any such Inventions or
Proprietary Rights are first reduced to practice or first fixed in a tangible
medium, as applicable) to the Company all right, title and interest in and to
any and all Inventions (and all Proprietary Rights with respect thereto) whether
or not patentable or registrable under copyright or similar statutes, made or
conceived or reduced to practice or learned by the Employee, either alone or
jointly with others, during the period of employment with the Company.
Inventions assigned to the Company, or to a third party as directed by the
Company pursuant to this Section 2, are hereinafter referred to as "Company
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Inventions."
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(d) The Employee recognizes that, in the event of a specially
applicable state law, regulation, rule, or public policy ("Specific Inventions
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Law"), this Agreement shall not be deemed to require assignment of any invention
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which qualifies fully for protection under a Specific Inventions Law by virtue
of the fact that any such invention was, for example, developed entirely on the
Employee's own time without using the Company's equipment, supplies, facilities,
or trade secrets and neither related to the Company's actual or anticipated
business, research or development, nor resulted from work performed by the
Employee for the Company. In the absence of a Specific Inventions Law, the
preceding sentence shall not apply.
(e) During the period of employment and for two (2) years after
termination of employment with the Company, the Employee shall promptly disclose
to the Company fully and in writing all Inventions authored, conceived or
reduced to practice by the Employee, either alone or jointly with others. In
addition, the Employee shall promptly disclose to the Company all patent
applications filed by the Employee or on behalf within two (2) years after
termination of employment. At the time of each such disclosure, the Employee
shall advise the Company in writing of any Inventions that the Employee believe
fully qualify for protection under the provisions of a Specific Inventions Law;
and the Employee shall at that time provide to the Company in writing all
evidence necessary to substantiate that belief. The Company shall keep in
confidence and shall not use for any purpose or disclose to third parties
without consent any confidential information disclosed in writing to the Company
pursuant to this Agreement relating to Inventions that qualify fully for
protection under a Specific Inventions Law. The Employee shall preserve the
confidentiality of any Invention that does not fully qualify for protection
under a Specific Inventions Law.
(f) The Employee also agree to assign all right, title and
interest in and to any particular Company Invention to a third party, including
without limitation the United States, as directed by the Company.
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(g) The Employee acknowledges that all original works of
authorship which are made by the Employee (solely or jointly with others) within
the scope of employment and which may be protected by copyright are "works made
for hire," pursuant to United States Copyright Act (17 U.S.C., Section 101).
(h) The Employee shall assist the Company in every proper way to
obtain, and from time to time enforce, United States and foreign Proprietary
Rights relating to Company Inventions in any and all countries. To that end the
Employee shall execute, verify and deliver such documents and perform such other
acts (including appearances as a witness) as the Company may reasonably request
for use in applying for, obtaining, perfecting, evidencing, sustaining and
enforcing such Proprietary Rights and the assignment thereof. In addition, the
Employee shall execute, verify and deliver assignments of such Proprietary
Rights to the Company or its designee. The Employee's obligation to assist the
Company with respect to Proprietary Rights relating to such Company Inventions
in any and all countries shall continue beyond the termination of employment and
the Company shall compensate the Employee at a reasonable rate after termination
for the time actually spent by the Employee at the Company's request on such
assistance.
(i) In the event the Company is unable for any reason, after
reasonable effort, to secure the Employee's signature on any document needed in
connection with the actions specified in the preceding paragraph, the Employee
hereby irrevocably appoint the Company and its duly authorized officers and
agents as the Employee's agent and attorney in fact to act for and in the
Employee's behalf to sign, execute, verify and file any and all documents and to
do all other lawfully permitted acts to further the purposes of the preceding
paragraph with the same legal force and effect as if executed by the Employee.
The Employee hereby waive and quitclaim to the Company any and all claims, of
any nature whatsoever, which the Employee now or may hereafter have for
infringement of any proprietary rights assigned to the Company.
3. Agreement not to Compete.
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(a) The Employee agrees with the Company that the services which
the Employee shall render during the term of employment are unique, special and
of extraordinary character and that the Company shall be substantially dependent
upon such services to develop and market its products and to earn a profit.
Accordingly, in consideration for employment by the Company and compensation and
other benefits, during the period of employment the Employee shall not directly
or indirectly compete with the Company (or any division, subsidiary or other
affiliate of the Company) in the research, development, manufacture, licensing,
patenting or marketing of any direct or indirect internet access service, or any
other service, equipment or devices functionally similar to or which may compete
with a product or with technology of the Company.
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(b) The term "compete" as used herein means to engage directly
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or indirectly either as a proprietor, partner, employee, agent, consultant,
director, officer, stockholder or in any other capacity or manner whatsoever.
The phrase "interfere with" includes, but is not limited to, soliciting or
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selling services or products which provide similar functions to any of the
Company's services or products to any current or potential customer of the
Company. The provisions of this Section shall not prevent the Employee from
investing any assets in securities of any corporation provided that such
investments do not, directly or indirectly, result in the Employee, family
members and other affiliates, collectively (i) owning beneficially at any time
five percent (5%) or more of the equity securities of any corporation engaged in
a business competitive with the Company, or (ii) otherwise being able to control
or actively participate in the business decisions of such competing business.
(c) The provisions of this Section 3 shall be enforced to the
fullest extent permissible under the laws and public policies applied to each
jurisdiction which enforcement is sought. If any particular provision or portion
of this Section shall be adjudicated to be invalid or unenforceable, this
Section shall be deemed amended to interpret such provision or portion thereof
so adjudicated to be invalid or unenforceable to extend only over the maximum
period of time, range of activities or geographic area as to which it may be
enforceable, such amendment to apply only with respect to the operation of this
Section in the particular jurisdiction in which such adjudication is made.
4. No Conflicting Employment; No Inducement of other Employees or
--------------------------------------------------------------
Solicitation of Customers.
-------------------------
The Employee agrees that during the period of employment by the
Company the Employee shall not, without the Company's express written consent,
engage in any other employment or business activity directly related to the
business in which the Company is now involved or becomes involved, nor shall the
Employee engage in any other activities which conflict with the Employee's
obligations to the Company. For the period of employment by the Company and for
two (2) years after the date of termination of employment by the Company the
Employee shall not (a) induce any employee of the Company to leave the employ of
the Company or (b) solicit the business of any client or customer of the Company
(other than on behalf of the Company).
If any restriction set forth in this Section is found by any court of
competent jurisdiction to be unenforceable because it extends for too long a
period of time or over too great a range of activities or in too broad a
geographic area, it shall be interpreted to extend only over the maximum period
of time, range of activities or geographic area as to which it may be
enforceable.
5. No Conflicting Obligations.
--------------------------
The Employee represents that performing of all the terms of this
Agreement and as an employee of the Company does not and shall not breach any
5
agreement to keep in confidence information acquired by the Employee in
confidence or in trust prior to employment by the Company. The Employee has not
entered into, and the Employee agrees not to enter into, any agreement either
written or oral in conflict herewith.
6. Return of Company Documents.
---------------------------
When the Employee leaves the employ of the Company, the 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, specifications, drawings, blueprints,
sketches, materials, equipment, other documents or property, together with all
copies thereof (in whatever medium recorded) belonging to the Company, its
successors or assigns. The Employee further agrees that any property situated on
the Company's premises and owned by the Company, including disks and other
storage media, filing cabinets or other work areas, is subject to inspection by
Company personnel at any time with or without notice. Prior to leaving, the
Employee shall cooperate with the Company in completing and signing the
Company's termination statement for technical and management personnel.
7. Notification of New Employee.
----------------------------
In the event that the Employee leaves the employ of the Company, the
Employee hereby consent to the notification of the new employer of the
Employee's rights and obligations under this Agreement.
8. Legal and Equitable Remedies.
----------------------------
Because the Employee's services are personal and unique and because
the Employee may have access to and become acquainted with the proprietary
information of the Company, the Company shall have the right to enforce this
Agreement and any of its provisions by injunction, specific performance or other
equitable relief, without bond, and without prejudice to any other rights and
remedies that the Company may have for a breach of this Agreement.
9. General Provisions.
-------------------
(a) The Employee agrees and understands that nothing in this
Agreement shall confer any right with respect to continuation of employment by
the Company, nor shall it interfere in any way with the Employee's right or the
Company's right to terminate the Employee's employment at any time, with or
without cause as more fully set forth in the Employment Agreement between the
Employee and the Company to which this Agreement is attached as Exhibit A.
(b) The validity and construction of this Agreement or any of
its provisions shall be determined under the laws of the State of Delaware,
without giving
6
effect to its conflicts of laws provisions, and without regard to its place of
execution or its place of performance. The parties irrevocably consent and agree
to the exclusive jurisdiction of the Circuit Court for Fairfax County or the
United States District Court for the Eastern District of Virginia and to service
of process for it and on its behalf by certified mail, for resolution of all
matters involving this Agreement or the transactions contemplated hereby. Each
party waives all rights to a trial by jury in any suit, action or proceeding
hereunder.
(c) This Agreement, and Exhibit A attached hereto and hereby
incorporated herein, sets forth the final, complete and exclusive agreement and
understanding between the Company and the Employee relating to the subject
matter hereof and supersedes all prior and contemporaneous understandings and
agreements relating to its subject matter. No modification of or amendment to
this Agreement, nor any waiver of any rights under this Agreement, shall be
effective unless in writing signed by the party to be charged. Any subsequent
change or changes in duties, salary or compensation shall not affect the
validity or scope of this Agreement.
(d) If one or more of the provisions in this Agreement are
deemed unenforceable by law, then the remaining provisions shall continue in
full force and effect.
(e) This Agreement shall be binding upon the Employee's heirs,
executors, administrators and other legal representatives and shall be for the
benefit of the Company, its successors and its assigns.
(f) The provisions of this Agreement shall survive the
termination of the Employee's employment and the assignment of this Agreement by
the Company to any successor in interest or other assignee.
(g) No waiver by the Company of any breach of this Agreement
shall be a waiver of any preceding or succeeding breach. No waiver by the
Company of any right under this Agreement shall be construed as a waiver of any
other right. The Company shall not be required to give notice to enforce strict
adherence to all terms of this Agreement.
THE EMPLOYEE UNDERSTANDS THAT THIS AGREEMENT AFFECTS HIS RIGHTS TO
INVENTIONS THAT HE MAKES DURING HIS EMPLOYMENT, AND RESTRICTS HIS RIGHTS TO
DISCLOSE OR USE THE COMPANY'S PROPRIETARY INFORMATION DURING OR SUBSEQUENT TO
HIS EMPLOYMENT.
THE EMPLOYEE HAS READ THIS AGREEMENT CAREFULLY AND UNDERSTAND ITS
TERMS. THE EMPLOYEE HAS COMPLETELY FILLED OUT EXHIBIT A TO THIS AGREEMENT.
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IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement on the date first above written.
EROL'S INTERNET, INC.
By: /s/ Xxxxxx X. Xxxxx
-------------------
Its: President and CEO
-------------------
/s/ Xxxxx Xxxxxx
----------------
Xxxxx Xxxxxx
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