AGREEMENT
AGREEMENT made as of the ___ day of October, 1996 by and between ALLEGRO
NEW MEDIA, INC., a Delaware corporation (hereinafter called the "Company") and
XXXX X. XXXXXXXXX, an individual residing at 00 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxx
Xxxxxx 00000 (hereinafter called the "Employee").
W I T N E S S E T H:
WHEREAS, the Company desires to continue to employ the Employee, and the
Company acknowledges that its entering into this agreement is a condition to the
Employee's willingness to continue such employment; and
WHEREAS, Employee desires to continue to be employed by the Company, and
the Employee acknowledges that his entering into this agreement is a condition
to the Company's willingness to continue such employment;
NOW, THEREFORE, it is agreed as follows:
1. Prior Agreements Superseded. This Agreement supersedes any
employment or consulting agreements, oral or written, entered into between
Employee and the Company prior to the date of this Agreement.
2. Confidential Information.
(a) In the course of Employee's employment by the Company, Employee will
have access to and possession of valuable and important confidential or
proprietary data or information of the Company, its subsidiaries and affiliates
(for purposes of this Section 2 and Section 3 of this Agreement referred to
collectively as the "Company") and their operations. Employee will not during
Employee's employment by the Company or at any time thereafter divulge or
communicate to any person nor shall Employee direct any employee, representative
or agent of the Company to divulge or communicate to any person or entity (other
than to a person or entity bound by confidentiality obligations similar to those
contained herein and other than as necessary in performing Employee's duties
hereunder) or use to the detriment of the Company or for the benefit of any
other person or entity, including without limitation any competitor, supplier,
licensor, licensee or customer of the Company, any of such confidential or
proprietary data or information or make or remove any copies thereof, whether or
not marked or otherwise identified as "confidential" or "secret." Employee shall
take all reasonable precautions in handling the confidential or proprietary data
or information within the Company to a strict need-to-know basis and shall
comply with any and all security systems and measures adopted from time to time
by the Company to protect the confidentiality of confidential or proprietary
data or information.
(b) The term "confidential or proprietary data or information" as used in
this Agreement shall mean information not generally available to the public,
including, without limitation, all database information, personnel information,
financial information, customer lists, account lists or other account
information, names, telephone numbers or addresses, supplier lists, trade
secrets, patented or proprietary information, forms, information regarding
operations, systems, methods, financing, services, know how, computer and any
other processed or collated data, computer programs, pricing, marketing and
advertising data of the Company.
(c) Employee will at all times promptly disclose to the Company in such
form and manner as the Company may reasonably require, any inventions,
improvements or procedural or methodological innovations, including without
limitation relating to programs, methods, forms, systems, services, designs,
marketing ideas, products or processes (whether or not capable of being
trademarked, copyrighted or patented) conceived or developed or created by
Employee during or in connection with Employee's employment hereunder and which
relate to the business of the Company ("Intellectual Property"). Employee agrees
that all such Intellectual Property shall be the sole property of the Company,
as the case may be. Employee further agrees that Employee will execute such
instruments and perform such acts as may reasonably be requested by the Company
to transfer to and perfect in the Company all legally protectable rights in such
Intellectual Property.
(d) All written materials, books, records and documents made by Employee or
coming into Employee's possession during Employee's employment by the Company
concerning any products, processes or equipment manufactured, used, developed,
investigated, purchased, sold or considered by the Company or otherwise
concerning the business or affairs of the Company, including without limitation
any files, customer records such as names, telephone numbers and addresses,
lists, firm records, brochures and literature, shall be the sole property of the
Company, shall not be removed from the Company's premises by the Employee, and
upon termination of Employee's employment by the Company, or upon request of the
Company during Employee's employment by the Company, Employee shall promptly
deliver the same to the Company. In addition, upon termination of Employee's
employment by the Company, Employee will deliver to the Company all other
Company property in Employee's possession or under Employee's control,
including, but not limited to, financial statements, marketing and sales data,
customer and supplier lists, account lists and other account information,
database information and other documents, and any Company credit cards.
(e) The Employee acknowledges that the covenants contained in this Section
2 are fair and reasonable in order to protect the Company's business and were a
material and necessary inducement for the Company to agree to the terms of this
Agreement. The Employee further acknowledges that any remedy at law for any
breach or threatened or attempted breach of the covenants contained in this
Section 2 may be inadequate and that the violation of any of the covenants
contained in this Section 2 will cause irreparable and continuing damage to the
Company. Accordingly, the Company shall be entitled to specific performance or
any other mode of injunctive and/or other equitable relief to enforce their
rights hereunder, including without limitation an order restraining any further
violation of such covenants, or any other relief a court might award, without
the necessity of showing any actual damage or irreparable harm or the posting of
any bond or furnishing of other security, and that such injunctive relief shall
be cumulative and in addition to any other rights or remedies to which the
Company may be entitled. The covenants in this Section 2 shall run in favor of
the Company, and its successors and assigns. In addition, the Employee agrees to
pay the Company the costs it incurs, including reasonable attorneys' fees and
expenses, in bringing and prosecuting any proceeding to enforce the terms of
this Agreement.
(f) The provisions of this Section 2 shall survive the termination of this
Employment Agreement.
3. Non-Competition.
(a) During the term of this Agreement and, other than with respect to
clause (i) below, for one year thereafter (the "Restricted Period"), the
Employee shall not, without the written consent of the Company, directly or
indirectly,
(i) become associated with, render services to, invest in, represent,
advise or otherwise participate in as an officer, employee, director,
stockholder, partner, promoter, agent of, consultant for or otherwise, any
business which is conducted in any of the jurisdictions in which the Company's
or Allegro's business is conducted and which is competitive with the business
productivity or visual communications computer software business;
(ii) for the Employee's own account or for the account of any other person
or entity (A) interfere with the Company's relationship with any of its
suppliers, material customers, accounts, brokers, representatives or agents or
(B) contact, telephone, meet, solicit or transact any business with any material
customer, account or supplier of the Company who or which transacts or has
transacted business with the Company at any time during the term of this
Agreement; or
(iii) employ or otherwise engage, or solicit, entice or induce on behalf of
the Employee or any other person or entity, the services, retention or
employment of any person who has been an employee, principal, partner,
stockholder, sales representative, trainee, consultant to or agent of the
Company within one year of the date of such offer or solicitation.
(b) Nothing herein contained shall be construed as prohibiting the Company
from pursuing any other remedies available to it for such violation, including
but not limited to any injunctive or other equitable relief or the recovery of
damages from the Employee.
(c) The Employee acknowledges that the covenants contained in this Section
3 are fair and reasonable in order to protect the Company's business and were a
material and necessary inducement for the Company to agree to the terms of this
Agreement. The Employee further acknowledges that any remedy at law for any
breach or threatened or attempted breach of the covenants contained in this
Section 3 may be inadequate and that the violation of any of the covenants
contained in this Section 3 will cause irreparable and continuing damage to the
Company. Accordingly, the Company shall be entitled to specific performance or
any other mode of injunctive and/or other equitable relief to enforce its rights
hereunder, including without limitation an order restraining any further
violation of such covenants, or any other relief a court might award, without
the necessity of showing any actual damage or irreparable harm or the posting of
any bond or furnishing of other security, and that such injunctive relief shall
be cumulative and in addition to any other rights or remedies to which the
Company may be entitled. The covenants in this Section 3 shall run in favor of
the Company and its successors and assigns. In addition, the Employee agrees to
pay the Company the costs they incur, including reasonable attorneys' fees and
expenses, in bringing and prosecuting any proceeding to enforce the terms of
this Agreement.
(d) In case any one or more of the terms or provisions contained in this
Section 3 shall for any reason be held invalid, illegal or unenforceable, such
invalidity, illegality or unenforceability shall not affect any other terms or
provisions hereof, but such term or provision shall be deemed modified or
deleted as or to the extent required by applicable law, and such modification or
deletion shall not affect the validity of the other terms or provisions of this
Section 3. In addition, if any one or more of the restrictions contained in this
Section 3 shall for any reason be held to be unreasonable with regard to time,
duration, geographic scope or activity, the parties contemplate and hereby agree
that such restriction shall be modified and shall be enforced to the full extent
compatible with applicable law. The parties hereto intend that the covenants
contained in this Section 3 shall be deemed a series of separate covenants for
each country, state, county and city. If, in any judicial proceeding, a court
shall refuse to enforce all the separate covenants deemed included in this
Section 3 because, taken together, they cover too extensive a geographic area,
the parties intend that those of such covenants (taken in order of the cities,
counties, states and countries therein which are lease populous) which if
eliminated would permit the remaining separate covenants to be enforced in such
proceeding shall, for the purpose of such proceeding, be deemed eliminated from
the provisions of this Section 3.
(e) The provisions of this Section 3 shall survive the termination of this
Employment Agreement.
4. Change of Control. (a) In the event there shall be a Change in present
Control of the Company, as hereinafter defined, or in any person directly or
indirectly presently controlling the Company, as hereinafter defined, Employee
shall have the option, exercisable within six (6) months of his becoming aware
of such event, to terminate this Agreement forthwith. Upon such termination, or
if the Employee's employment by the Company has been terminated by the Company
within six (6) months prior to such Change in Control or if the Employee's
employment is terminated by the Company within one year after such Change in
Control other than "for cause" (as defined below), (i) Employee shall have the
right to receive payment from the Company of an amount equal to three times the
average of the total annual cash compensation paid to the Employee during the
immediately preceding five (5) full fiscal years, less $1.00 and (ii) all
options and other awards under the Company's 1994 Long-Term Incentive Plan or
otherwise shall become immediately exercisable or vested, as the case may be.
Such amount shall be paid at the time of such termination.
(b) For purposes of this Agreement, a Change in Control of the Company, or
in any person directly or indirectly controlling the Company, shall mean:
(i) a Change in Control as such term is presently defined in Regulation
240.12b-2 under the Securities Exchange Act of 1934 ("Exchange Act"); or
(ii) if any "person" (as such term is used in Section 13(d) and 14(d) of
the Exchange Act) other than the Company or any "person" who on the date of this
Agreement is a director or officer of the Company, becomes the "beneficial
owner" (as defined in Rule 13(d)-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing twenty percent (20%) of
the voting power of the Company's then outstanding securities; or
(iii) if during any period of two (2) consecutive years during the term of
this Agreement, individuals who at the beginning of such period constitute the
Board of Directors cease for any reason to constitute at least a majority
thereof, unless the election of each director who is not a director at the
beginning of such period has been approved in advance by directors representing
at least two-thirds (2/3) of the directors then in office who were directors at
the beginning of the period.
(c) For the purposes of this agreement, "for cause" shall mean; (i) any act
of fraud or embezzlement materially adversely affecting the financial, market,
reputation or other interests of the Company, its subsidiaries or any of their
affiliates, (ii) in the event of a conviction of the Employee for any crime of
moral turpitude or any knowing violation of any federal or state securities law
or regulation, (iii) failure to perform Employees duties hereunder, (iv) any
material breach by the Employee of this Agreement, or (v) the death of the
Employee.
5. Consolidation or Merger. In the event of any consolidation or merger of
the Company into or with any other corporation during the term of this Agreement
which is not subject to Sectin 4 above, or the sale of all or substantially all
of the assets of the Company to another corporation, person or entity during the
term of this Agreement, the successor or surviving corporation or purchaser of
such assets, as the case may be, shall assume this Agreement and become
obligated to perform all of the terms and provisions hereof applicable to the
Company, and Employee's obligations hereunder shall continue in favor of such
successor corporation.
6. Notices. Any notice to be given to the Company hereunder shall be deemed
sufficient if addressed to the Company in writing and delivered or mailed by
certified or registered mail to its offices at 0 Xxx Xxxx, Xxxxxxxxx, Xxx Xxxxxx
00000, or such other address as the Company may hereafter designate. Any notice
to be given to Employee hereunder shall be delivered or mailed by certified or
registered mail to him at: 00 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxxxx 00000 or
such other address as he may hereafter designate.
7. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the successors and assigns of the Company, and unless
clearly inapplicable, all references herein to the Company shall be deemed to
include any such successor. In addition, this Agreement shall be binding upon
and inure to the benefit of the Employee and his heirs, executors, legal
representatives and assigns; provided, however, that the obligations of Employee
hereunder may not be delegated without the prior written approval of the Board
of Directors of the Company.
8. Amendments. This Agreement may not be altered, modified, amended or
terminated except by a written instrument signed by each of the parties hereto.
9. Applicable Law. This Agreement shall be governed by, construed and
enforced in accordance with the laws of the State of New Jersey, without regard
to conflicts of laws.
10. No Right to Employment. This Agreement shall not be construed to grant
to the Employee any right to continue to be employed by the Company.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
ALLEGRO NEW MEDIA, INC.
/s/Xxxxx X. Cinnamon
By:-------------------------
Xxxxx X. Cinnamon
President
/s/Xxxx X. Xxxxxxxxx
----------------------------
XXXX X. XXXXXXXXX
