Exhibit 10.4 - Employment Agreement dated September 25, 2003 by and between
Axeda Systems Inc. and Xxxx X. Xxxxxxx
Employment Agreement
THIS EMPLOYMENT AGREEMENT (the "Agreement") is dated as of the 25th day of
September, 2003, and is by and between Axeda Systems Inc. and its wholly owned
subsidiaries to which this agreement may be assigned, a Delaware corporation
with its principle office located at 00 Xxxxxx Xxxx, Xxxxxxxxx, Xxxxxxxxxxxxx
00000 (hereinafter "Company") and Xxxx Xxxxxxx with an address at 00 Xxxxxxxx
Xxxxx, Xxxxxxxx, Xxxxxxxxxxxxx 00000 (hereinafter "Employee").
W I T N E S S E T H
WHEREAS:
A. The Company and the Employee entered into an Employment Agreement dated as of
January 10, 2002, amended as of February 28, 2003 (the "Previous Employment
Agreement"); and
B. Employee was appointed Vice President, General Counsel and Secretary on
August 14, 2003; and
C. Company wishes to retain the services of Employee to render services for and
on behalf of Company, in accordance with the following terms, conditions and
provisions; and
D. Employee wishes to perform such services for and on behalf of Company, in
accordance with the following terms, conditions and provisions.
NOW, THEREFORE, in consideration of the mutual covenants and conditions herein
contained the parties hereto intending to be legally bound hereby agree as
follows:
I. EMPLOYMENT. Company hereby employs Employee and Employee accepts such
employment, and shall perform his duties and the responsibilities provided for
herein accordance with the terms and conditions of this Agreement. Employee
agrees that his place of employment shall be such offices that Company may
occupy from time to time in the Mansfield, Massachusetts vicinity.
II. EMPLOYMENT STATUS. Employee shall at all times be Company's employee subject
to the terms and conditions of this Agreement.
III. TITLE AND DUTIES. Company agrees to employ Employee and Employee accepts
such employment as a full time employee and agrees as per the terms and
conditions of this agreement to serve as and have the title of Vice President,
Chief Legal Officer and General Counsel and perform diligently, faithfully, and
to the best of his ability, duties as reasonably assigned and instructions given
by the CEO of Company or the Company's Board of Directors.
IV. TERM OF SERVICES. The term of this Agreement is for a period commencing on
September 25, 2003 and ending on September 25, 2004, subject to the termination
section of this agreement. This Agreement will automatically renew for
subsequent one-year terms, unless either party delivers notice to the other
party of its desire not to renew this Agreement prior to the expiration of the
initial term or any renewal term.
V. BASE COMPENSATION. Employee's base salary for rendered services for the
initial term of this agreement shall be one hundred sixty thousand dollars
($160,000), an annual amount payable in accordance with Company's payroll
procedures and policies as implemented during the term of this agreement. All
reference to payments in this Agreement is in U.S. dollars.
VI. ADDITIONAL COMPENSATION. The Company and the Compensation Committee of its
Board of Directors shall have complete discretion to grant Employee a bonus, or
any other specific additional compensation packages proposed for payment or for
vesting, to Employee, during the term of this Agreement.
VII. EMPLOYER PERQUISITES. Employee shall be entitled to and shall receive all
employer perquisites as would normally be granted to employees of Company. Such
perquisites to include the following:
1. Medical, dental, life and disability insurance under terms and
conditions as provided to other employees of Company;
2. Twenty days vacation, accrued annually pursuant to Company's stated
policy;
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3. $500 monthly car allowance;
4. You are eligible for an annual bonus of up to $75,000, payable
quarterly, based on your meeting mutually agreed-upon goals and
objectives, and any additional bonus in accordance with the Executive
Officer incentive plan approved by the Compensation Committee of the
Board of Directors. The bonus for the 2003 calendar year is guaranteed.
5. A one-time issuance of 55,000 stock options under Company's 1999
Stock Option Plan, subject to Company's 's standard vesting schedule.
Such options will be Incentive Stock Options, to the extent permissible
by law and Company's 's 1999 Stock Option Plan (subject to approval by
the Compensation Committee of the Board of Directors);
6. Paid holidays pursuant to Company's stated policy;
7. Participation in Company's 401(k) plan;
8. Such other benefits, as the Company generally makes available to its
employees at the same level.
VIII. EXTENT OF SERVICES. Employee shall devote his entire business time,
attention, and energies to the business of Company, but this shall not be
construed as preventing Employee from investing his assets in the future as a
passive investor in such form or manner as he sees fit as long as the
investments will not require any personal service from Employee. However,
Employee agrees not to knowingly invest in any entities that compete directly
with Company or affiliated or related companies.
IX. TERMINATION.
1. A termination for "Cause" shall mean a termination for any of the following
reasons: (i) Employee's material failure to perform satisfactorily the duties of
his position after receipt of a written warning to perform satisfactorily; (ii)
Employee engaged in material misconduct; (iii) Employee is convicted of a
felony; (iv) Employee commits an act of fraud against, or misappropriates
property belonging to, Company; or (v) Employee commits a material breach of
this Agreement or any confidentiality or proprietary information agreement
between Employee and Company. Company will provide written notice of the reason
for termination in the case of any termination for Cause. A termination of
Employee's employment for any reason other than the foregoing shall be an
Involuntary Termination.
2. "Involuntary Termination" shall mean Employee's termination which occurs by
reason of: (i) Employee's involuntary dismissal or discharge by the Company
other than for Cause; or (ii) such individual's voluntary resignation following
(A) a change in his position with the Company or Parent or Subsidiary employing
the individual which materially reduces his duties and responsibilities or the
level of management to which he reports, (B) a reduction in his level of
compensation (including base salary, fringe benefits and target bonus under any
performance based bonus or incentive programs) by more than fifteen percent
(15%), (C) a relocation of such individual's place of employment by more than
fifty (50) miles, provided and only if such change, reduction or relocation is
effected by the Company without the individual's consent or (D) job abolishment,
position elimination due to merger, acquisition, or sale of assets.
3. It is understood and agreed that this is a personal services contract, and
that Company shall have the right to terminate this agreement on 10 days notice
to Employee, if appropriate, in the event of the disability or death of Employee
which would otherwise prevent him from performing his or her duties. For purpose
of this provision, "disability" shall be defined in accordance with the
definition of "disability" as contained in Company's disability insurance
policy. In the event of Employee's death; any guaranteed monies due under this
agreement would be paid directly to Employee estate as probated.
4. In the event: (a) of Employee's Involuntary Termination, (b) Employee's
employment is terminated as a result of his death or disability (as provided in
paragraph 3 above) or (c) the Company gives notice to Employee that it does not
desire to renew the Agreement for a subsequent one year period, then, in
addition to the payment of all amounts earned by Employee as of the date of
termination or expiration, Company will pay Employee a lump sum payment equal to
one-half year (six months) of Employee's base salary and health benefits after
expiration or such notice of termination is given. Company shall make such
payment promptly after such expiration or notice of termination is given, but in
no event later than the next regular Company pay period.
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X. CONFIDENTIAL INFORMATION.
1. The nature of the work performed and any information belonging to Company
with which Employee may or have become familiar will be treated as confidential
and may not be disclosed to third parties without the written consent of
Company, whether or not this Agreement is in effect. If any portion of the work
performed under this Agreement is of a classified or confidential nature, or
develops into such, Employee agrees to preserve the security of such work in
compliance with all applicable laws and regulations of the United States.
2. Employee agrees that Employee shall keep in strictest confidence all
information relating to the products, methods of manufacture, marketing and
sales plans, financial information, customer and supplier information, pricing
information, software, trade secrets or secret processes (except information in
the public domain) or the business or affairs of Company which may be acquired
in connection with or as a result of his employment or otherwise. During the
term of this Agreement and at any time thereafter, without the prior written
consent of Company, Employee will not publish, communicate, divulge, disclose or
use any of such information which has been designated as secret, confidential,
proprietary and/or trade secret, or which from the surrounding circumstances in
good conscience ought to be treated as secret or confidential. Upon termination
of this Agreement, Employee will return to Company all documents, graphic
materials, or other materials containing or comprising such confidential
information.
3. Employee agrees and understands that Company does not desire to receive the
proprietary rights or trade secrets of third patties if not so authorized, and
Employee agrees not to disclose any such proprietary rights or trade secrets to
Company.
XI. NON-COMPETITION.
1. Employee acknowledges and agrees that by entering into this Agreement with
Company and engaging in the employment relationship contemplated hereby,
Employee will be performing significant duties on behalf of Company, and
Employee will be exposed to certain valuable know-how and information relating
to a highly competitive industry. Employee also acknowledges and agrees that the
covenants set forth in this section are a material part of the consideration
bargained for by Company, and without Employee's agreement to be bound by such
covenants, Company would not have agreed to enter into this Agreement or to
engage Employee's services.
2. Employee agrees that during the term of this Agreement and for one (1) year
after any termination of this Agreement Employee will not, directly or
indirectly, (i) solicit, divert, recruit, induce, encourage or attempt to
influence any client, customer, employee, consultant, independent contractor,
salesman or supplier of Company, to cease to do business, decrease the level of
business, or terminate his or her employment or otherwise cease his, her or its
relationship with Company, as the case may be, or (ii) engage in (as a
principal, agent, owner, consultant, partner, director, officer, employee,
stockholder, investor, lender or otherwise), alone or in association with any
person or entity, or be financially interested in or otherwise connected with
any business in any activity similar to or in connection with the specific
activities of Company, and which such business activity is to produce,
manufacture, import, market or distribute in the United States or Europe or Asia
any product or service (A) which is, at the date of termination, currently being
produced, manufactured, imported, marketed or distributed by or for Company, or
(B) which Company, as of the date of termination, had plans to produce,
manufacture, import, market or distribute during the term of this section;
provided, however, that nothing contained in this Agreement shall prevent
Employee from holding for investment up to 5% of any class of equity securities
of a company whose securities are publicly traded (other than Company as to
which there shall be no such limitation).
XII. REMEDIES. Employee acknowledges and agrees that: (a) the covenants set
forth in sections X and XI of this Agreement are reasonable and are essential to
the business interests and operations of Company; (b) Company will not have any
adequate remedy at law if Employee violates the terms hereof or fails to perform
any of Employee's obligations hereunder; and (c) Company shall have the right,
in addition to any other rights it may have under applicable law, to obtain from
any court of competent jurisdiction preliminary and permanent injunctive relief
to restrain any breach or threatened breach of or otherwise to specifically
enforce any such covenant or any other of Employee's obligations under this
Agreement, as well as to obtain damages and an equitable accounting of all
earnings, profits and other benefits arising from such violation, which rights
shall be cumulative and in addition to any other rights or remedies to which
Company may be entitled.
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XIII. NO CONFLICT. Employee represents and warrants to Company that he is not a
party to or otherwise bound by any other employment or services that may, in any
way, restrict his right or ability to enter into this agreement or otherwise be
employed by Company.
XIV. NOTICES. Any written notice required to be given pursuant to this agreement
shall be hand delivered or sent via fax or E-mail, or delivered by a national
overnight express service such as Federal Express.
XV. JURISDICTION AND DISPUTES. This agreement shall be governed by the laws of
the Commonwealth of Massachusetts. All disputes hereunder shall be resolved in
the applicable state or federal courts of Massachusetts. The parties consent to
the exclusive jurisdiction of such courts, agree to accept service or process by
mail, and waive any jurisdictional or venue defenses otherwise available. The
parties reserve the right to mutually agree to binding arbitration in accordance
with the policies of the American Arbitration Association.
XVI. AGREEMENT BINDING ON SUCCESSORS. This agreement shall be binding on and
shall inure to the benefit of the parties hereto, and their heirs,
administrators, and permitted successors and assigns.
XVII. WAIVER. No waiver by either party of any default shall be deemed as a
waiver of any prior or subsequent default of the same or other provisions of
this agreement.
XVIII. SEVERABILITY. If any provision hereof is held invalid or unenforceable by
court of competent jurisdiction, such invalidity shall not affect the validity
or operation of any other provision, and such invalid provision shall be deemed
to be severed from the agreement.
XIX. ASSIGNABILITY. This agreement and the rights and obligations thereunder are
personal with respect to Employee and may not be assigned by any action of
Employee or by operation of law. Company shall, however, have the right to
assign this agreement to a successor in interest to the business or assets of
Company or to any affiliate of Company.
XX. INTEGRATION. This agreement constitutes the entire understanding of the
parties and is intended as a final expression of their agreement. It shall not
be modified or amended except in writing signed by the parties thereto and
specifically referring to this agreement. This agreement shall take precedence
over any other documents that may be in conflict therewith.
IN WITNESS WHEREOF, Company and Employee confirm the foregoing
accurately sets forth the parties' respective rights and obligations and agrees
to be bound by having the evidenced signature affixed thereto.
AXEDA SYSTEMS INC.
By:/s/Xxxx XxXxxx /s/Xxxx Xxxxxxx
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Name:Xxxx XxXxxx Xxxx Xxxxxxx
Title:VP-Human Resources
Date:10/1/03 Date:
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