EXHIBIT 10.16
AMENDMENT NO. 3 TO XXXX XXXXXX EMPLOYMENT AGREEMENT
NetCo Communications Corporation (hereinafter referred to as the
"Corporation") and Xxxx Xxxxxx (hereinafter referred to as the "Employee" are
parties to an Employment Agreement dated May 10, 1995 (the "Employment
Agreement").
It is agreed between the parties that paragraph 3.1 of the Employment Agreement
be amended to read:
3.1 Base Salary. The Corporation shall pay Employee a Base
Salary ("Base Salary") of Seven Thousand Seven Hundred Eight
Dollars Thirty Three Cents ($7,708.33) per month commencing
January 1, 1998. The Base Salary shall be paid according to the
Corporation's regular payroll procedure, in equal increments
not less frequently than monthly.
It is further agreed between the parties that, except as expressly amended
by this Amendment No. 3, the Employment Agreement shall continue in full force
and effect according to its terms.
IN WITNESS WHEREOF, the parties hereto have duly executed the amendment.
"Employee" "Corporation"
Xxxx Xxxxxx NetCo Communications
Corporation
/s/ Xxxx Xxxxxx By: /s/ Xxxx Xxxxxxxx
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An Authorized Agent or Officer
AMENDMENT NO. 2 TO XXXX XXXXXX EMPLOYMENT AGREEMENT
NetCo Communications Corporation (hereinafter referred to as the
"Corporation") and Xxxx Xxxxxx (hereinafter referred to as the "Employee" are
parties to an Employment Agreement dated May 10, 1995 (the "Employment
Agreement").
It is agreed between the parties that paragraph 3.1 of the Employment
Agreement be amended to read:
3.1 Base Salary. The Corporation shall pay Employee a Base Salary
("Base Salary") of Seventy Five Thousand Dollars ($75,000) per annum
commencing January 1, 1997. The Base Salary shall be paid according
to the Corporation's regular payroll procedure, in equal increments
not less frequently than monthly.
It is further agreed between the parties that, except as expressly amended
by this Amendment No. 2, the Employment Agreement shall continue in full force
and effect according to its terms.
IN WITNESS WHEREOF, the parties hereto have duly executed the amendment.
"Employee" "Corporation"
Xxxx Xxxxxx NetCo Communications
Corporation
/s/ Xxxx Xxxxxx By: /s/ Xxxxxx X. Xxxxxxxx, III
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Xxxxxx X. Xxxxxxxx, III
President and CEO
AMENDMENT NO. 1 TO XXXX XXXXXX EMPLOYMENT AGREEMENT
NetCo Communications Corporation (hereinafter referred to as the
"Corporation") and Xxxx Xxxxxx (hereinafter referred to as the "Employee" are
parties to an Employment Agreement dated May 10, 1995 (the "Employment
Agreement").
It is agreed between the parties that paragraph 3.1 of the Employment
Agreement be amended to read:
3.1 Base Salary. The Corporation shall pay Employee a Base
Salary ("Base Salary") of Forty Five Thousand Dollars ($45,000)
per annum commencing October 16, 1995. The Base Salary shall be
increased to Fifty Thousand Dollars ($50,000) per annum
commencing on March 18, 1996 providing that the Employee
receives a written, six month performance review and written
recommendation by the Chief Financial Officer for this base
salary increase. The Base Salary shall be paid according to the
Corporation's regular payroll procedure, in equal increments
not less frequently than monthly.
It is further agreed between the parties that, except as expressly amended
by this Amendment No. 1, the Employment Agreement shall continue in full force
and effect according to its terms.
IN WITNESS WHEREOF, the parties hereto have duly executed the amendment.
"Employee" "Corporation"
Xxxx Xxxxxx NetCo Communications
Corporation
/s/ Xxxx Xxxxxx By: /s/ Xxxxxx X. Xxxxxxxx, III
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Xxxxxx X. Xxxxxxxx, III
Chief Executive Officer
EMPLOYMENT AGREEMENT
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AGREEMENT, made and entered into this 10th day of May, 1995, by and
between Netco Communications Corporation, a Minnesota corporation (the
"Corporation"), and XXXX XXXXXX ("Employee").
WHEREAS, the Corporation and the Employee desire to record the terms of
Employee's employment by the Corporation;
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the parties
agree as follows:
1. TERM OF EMPLOYMENT. Subject to the terms and conditions of this
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Agreement, the Corporation hereby employs Employee and Employee hereby accepts
employment for the period commencing _______________________, 1995, and
continuing thereafter until the employment is terminated according to the
provisions of this Agreement.
2. DUTIES. During the term of this Agreement, Employee shall perform the
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duties of Controller and such additional duties as may be prescribed from time
to time by the Board of Directors or the Chief Executive Officer of the
Corporation.
3. BASE SALARY, COMMISSION, BONUS AND OTHER COMPENSATION.
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3.1 Base Salary. The Corporation shall pay Employee a Base Salary ("Base
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Salary") of Thirty Six Thousand Dollars ($36,000) per annum commencing
10th May, 1995. The Base Salary shall be paid according to the Corporation's
regular payroll procedure, in equal increments not less frequently than monthly.
3.2 Incentive Stock Option. In addition to any other compensation to
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which Employee may be entitled by this agreement, Employee shall be entitled to
receive an Incentive Stock Option for Two Thousand (2,000) shares of the
Corporation under the Corporation's 1994 Stock Option Plan according to the
Incentive Stock Option Agreement appended hereto as Exhibit 1. The exercise
price of the Incentive Stock Option shall be in the amount of Two Dollars Twenty
Five Cents ($2.25) per share, being the fair market value on the date of grant.
3.3 Bonus. In addition to any other compensation to which Employee may be
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entitled by this agreement, Employee shall be entitled participate in a bonus
plan to be adopted by the Corporation based upon the Corporation's performance
and achievement of defined goals, including sales growth,
profitability and other factors contributing the Corporation's success, as may
be established annually by the Corporation. The Corporation intends to adopt
such a bonus plan prior to December 31, 1995, to be applicable to following
years.
4. BENEFITS.
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4.1 Vacation. During each year of his employment, Employee will be
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entitled to reasonable vacations, holidays and sick leave. Vacations shall be
at such time or times and for such periods as Corporation and Employee shall
agree.
4.2 Benefit Programs, Insurance. Employee shall be entitled to
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participate in customary employee benefit programs as may be from time to time
determined by the Board of Directors including, but not limited to, life
insurance, hospitalization, surgical and major medical coverage, and long-term
disability as are or may be made available from time to time to other salaried
employees of the Corporation. Before such time as the Corporation provides
medical coverage to all employees, Employee shall be entitled to cash
compensation equivalent to monthly Cobra expense.
5. TERMINATION.
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5.1 Events of Termination. This Agreement may be terminated upon the
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occurrence of any one of the following events:
(a) Voluntary. Employee may terminate this Agreement at any time
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during the term of this Agreement by giving 30 days prior written notice
of termination to the Board.
(b) Involuntary Without Cause. The Corporation may terminate this
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Agreement without cause by 30 days written notice to Employee.
(c) Involuntary With Cause. The Corporation may terminate this
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Agreement immediately for cause for (i) Employee's material breach of any
agreement with the Corporation, (ii) Employee's deliberate, willful or
gross misconduct in the performance or Employee's duties on behalf of the
Corporation, or (iii) Employee's being charged with a crime punishable by
imprisonment
(d) Death. This Agreement shall automatically terminate upon the
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death of the Employee.
(e) Disability. This Agreement shall automatically terminate upon
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the permanent disability of Employee. For the purposes of this Agreement,
Employee shall be deemed permanently disabled if any ailment, illness or
other incapacity prevents him from performing his duties as
specified in this Agreement for a period of three consecutive months or
for an aggregate of three months in any twelve month period from the date
of this Agreement.
5.2 Consequences of Termination.
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(a) In the event of the termination of this Agreement in accordance
with Subparagraph 5.1(a) or 5.1(c) above, Employee shall be entitled to
Base Salary, and Bonus, if any, earned by him prior to the date of
termination as provided herein computed on a pro rata basis to and
including such date of termination. In addition, Employee shall also be
reimbursed for his reasonable business expenses incurred prior to the date
of termination.
(b) If the Corporation terminates this Agreement without cause
pursuant to Subparagraph 5.1(b) above, Employee shall be entitled to
receive a severance cash payment as liquidated damages for, and in lieu of,
any and all damages which he may incur as a result of such termination in
the amount of Twelve Thousand Dollars ($12,000).
(c) In the event this Agreement is terminated due to the death
(pursuant to Subparagraph 5.1(d)) or disability (pursuant to Subparagraph
5.1(e)) of Employee, Employee (or his estate) shall be entitled to the base
salary earned by him prior to the date of termination as provided herein
computed on a pro rata basis to and including such date of termination plus
any cash bonus payable with respect to the fiscal year of death or
disability according to normal payment procedures of the Corporation.
6. NON-COMPETITION; INVENTIONS.
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6.1 Definitions. For purposes of this Section 6, the following words
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and phrases have the meanings ascribed to them, respectively:
(a) "Confidential Information" means all formulas,
processes, customer lists, computer user identifiers and
passwords, and all purchasing, engineering, accounting,
marketing and other information that is proprietary to the
Corporation and not generally known or readily ascertainable
by proper means, relating to research, development,
manufacture or sale of the Corporation's products, as well
as formulas, processes and other information received by the
Corporation from third parties under an obligation
of secrecy. All information disclosed to Employee or to
which Employee has access during the period of his
employment, which he has reasonable basis to
believe to be Confidential Information, or which is treated
by the Corporation as being Confidential Information, shall
be presumed to be Confidential Information.
(b) "Inventions" means all formulas, processes, discoveries,
improvements, ideas and works of authorship, whether patentable or
copyrightable or not, which Employee learns, has access to, has a part
in developing, first conceives or first reduces to practice, alone or
with others (1) that are developed on the Corporation's time, or (2)
that relate directly to the Corporation's business or actual or
anticipated research, or (3) for which any of the Corporation's
property, including Confidential Information, is used, or (4) that
result from any of Employee's work for the Corporation.
6.2. Disclosure and Assignment. Except as provided elsewhere in this
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Agreement, Employee shall treat as for the Corporation's sole benefit and fully
and promptly disclose to the Corporation, without additional compensation, all
ideas, discoveries, inventions and improvements, whether patentable or not,
which, while the Employee is employed by the Corporation, are made conceived or
reduced to practice by Employee, alone or with others, during or after usual
working hours, either on or off the job, and Employee hereby assigns to the
Corporation all such ideas, discoveries, inventions and improvements to be the
Corporation's exclusive property.
6.3 Further Documents. Employee will acknowledge and deliver
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promptly with reasonable charge all documents to the Corporation, and will do
such other acts as may be necessary in the Corporation's opinion to obtain and
maintain patents (including divisional, reissued or extended Letters Patent) or
copyrights and to vest the entire right and title in the Corporation to such
patents, copyrights and Inventions in all countries.
6.4 Confidentiality. Employee will not use or disclose any
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Confidential Information, either during or after employment by the Corporation,
except as required by his duties to the Corporation, and Employee acknowledges
and understands that the obligation to maintain the confidentiality of the
Corporation's Confidential Information is unconditional and shall not be excused
by any conduct on the part of the Corporation except its prior voluntary
disclosure of the information. Upon termination of employment, Employee agrees
that (a) all Confidential Information, including all copies, excerpts and
summaries in his possession or control (whether prepared by the Corporation, the
Employee or others), and also all other the Corporation property, including
keys, credit cards, software, reports and the like, shall be left with the
Corporation and (b) Employee will stop use of all Confidential Information.
Employee shall not at any time during the term of this Agreement or thereafter,
or in any manner, either directly or indirectly, divulge, disclose or
communicate to any person, firm or corporation in any manner whatsoever any
information concerning any matters affecting or relating to the business of the
Corporation, including without limiting the generality of the foregoing, any of
its customers, the prices it obtains or has obtained from the sale of, or at
which it sells or has sold, its products, or any other information concerning
the business of the Corporation, its manner of operation, its plans, processes,
or other data without regard to whether all of the foregoing matters will be
deemed confidential, material, or important, the parties hereto stipulating that
as between them, the same are important, material, and confidential and gravely
affect the effective and successful conduct of the business of the Corporation,
and the Corporation's good will, and that any breach of the terms of this
Section 6 shall be a material breach of this Agreement.
6.5 Limitation; First Refusal. The obligations of Section 6.2 and
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6.3 shall not apply to any ideas, discoveries, inventions and improvements for
which no equipment, supplies, facility or trade secret information of the
Corporation was used, and which was developed entirely on Employee's own time,
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and (1) which does not relate (a) directly to the business of the Corporation or
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(b) to the Corporation's actual or demonstrably anticipated research or
development, or (2) which does not result from any work performed by Employee
for the Corporation. Employee will, nonetheless, promptly disclose all such
ideas, discoveries, inventions and improvements to the Corporation and offer to
the Corporation the right of first refusal to enter into a license or purchase
agreement covering the subject idea, discovery, invention or improvement on
terms mutually agreed to by Employee and the Corporation. In the event the
Corporation and Employee cannot agree on terms and Employee receives an offer to
enter into a license or purchase agreement with some other party on terms more
favorable to that other party than the terms offered to the Corporation, then
the Corporation shall have the right and Employee shall have the obligation to
offer to the Corporation the idea, discovery, invention or improvement on such
favorable terms. When such an offer is made to the Corporation pursuant to the
preceding sentence, it must be accepted by the Corporation within thirty (30)
days; or if not accepted, the right of first refusal hereunder as to that offer
shall terminate.
NOTICE: SECTION 6 HEREOF REQUIRES EMPLOYEE TO ASSIGN RIGHTS TO INVENTIONS
TO THE CORPORATION OR ITS SUCCESSORS. MINNESOTA STATUTES $181.78 LIMITS THE
SCOPE OF AGREEMENTS REQUIRING THE INVENTIONS BE ASSIGNED TO EMPLOYERS. THE
STATUTE STATES THAT SUCH ASSIGNMENT AGREEMENTS DO NOT APPLY:
"TO AN INVENTION FOR WHICH NO EQUIPMENT, SUPPLIES, FACILITY OR TRADE
SECRET INFORMATION OF THE EMPLOYER WAS USED AND WHICH WAS DEVELOPED
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ENTIRELY ON THE EMPLOYEE'S OWN TIME, AND (1) WHICH DOES NOT RELATE (A)
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DIRECTLY TO THE BUSINESS OF THE EMPLOYER OR (B) TO THE EMPLOYER'S
ACTUAL OR DEMONSTRABLY ANTICIPATED RESEARCH OR DEVELOPMENT, OR (2)
WHICH DOES NOT RESULT FROM ANY WORK PERFORMED BY THE EMPLOYEE FOR THE
EMPLOYER."
PLEASE NOTE THAT SECTION 6 OF THIS AGREEMENT USES THESE STATUTORY TERMS TO
DEFINE THE INVENTIONS WHICH ARE NOT AUTOMATICALLY ASSIGNED TO THE CORPORATION
BUT INSTEAD ARE SUBJECT TO A RIGHT OF FIRST REFUSAL IN FAVOR OF THE CORPORATION.
6.6 Assistance to the Corporation. Employee shall give the
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Corporation, at the Corporation's expense, all assistance the Corporation
reasonably requires to perfect, protect, and exercise the rights to all ideas,
discoveries, inventions or improvements acquired by the Corporation pursuant to
the assignment provisions or the right of first refusal provisions of this
Section 6.
6.7 Non-Competition. For one (1) year after termination of Employee's
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employment with Corporation (hereafter referred to as the "Non-Competition
Period") for any reason and by either party:
(a) Before accepting new employment Employee will give a copy of this
Agreement to any employer engaged in or planning to become engaged in
Conflicting Product development or activity or those engaged in related product
development or activity;
(b) Employee will not sell or solicit orders for any Conflicting
Product to or from any customer whom Employee solicited or rendered service or
technical assistance to, or whose account Employee supervised or serviced for
the Corporation, at any time during the last two years of Employee's employment
with the Corporation;
(c) Employee will not engage in or be employed in the development,
production or provision of a Conflicting Product;
(d) Employee will not serve any organization or person engaged in the
development, production or sale of any Conflicting Product except after
furnishing the Corporation with written assurances, satisfactory to the
Corporation, both from Employee and from Employee's new employer, stating that
Employee will not render services prohibited by subparagraphs (b) or (c) of this
Section 6.7.
(e) For purposes of this Section 6.7, "Conflicting Products" means
any product, process, equipment, concept or service (in existence or under
development) of any person or
organization (other than the Corporation), which resembles or competes with a
product, process, equipment, concept or service upon which I may have worked or
which I may have sold during the last two (2) years of my employment by the
Corporation, or concerning which I acquired Confidential Information at any time
through my work with the Corporation.
(f) If Employee has any questions about whether particular activities
may violate my Non-Competition obligations, Employee will contact the President
of the Corporation in writing, and the Corporation agrees to advise Employee of
its position and/or, in Netco's sole discretion, provide Employee with a written
release.
6.8 Remedies. The Employee's obligations set forth in Section 6 of this
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Agreement shall continue to be binding upon Employee, notwithstanding the
termination of his employment with the Corporation for any reason whatsoever.
Such obligations shall be deemed and construed as separate agreements
independent of any other provisions of this Agreement. The existence of any
claim or cause of action by Employee against the Corporation, whether predicated
on this Agreement or otherwise, shall not constitute a defense to the
enforcement by the Corporation or any or all of such obligations. It is
expressly agreed that the remedy at law for the breach of any such obligation is
inadequate and that temporary and permanent injunctive relief shall be available
to prevent the breach or any threatened breach thereof, without the necessity of
proof of actual damages
7. Notices. Any notices to be given hereunder by either party to the
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other may be effected either by personal delivery in writing or by mail,
registered or certified, postage prepaid, with return receipt requested.
Personal delivery to the Corporation shall mean personal delivery to the Chief
Executive Officer of the Corporation. Mailed notices shall be addressed to the
respective addresses shown below. Either party may change its address for
notice by giving written notice according to the terms of this Section 7.
(a) If to Employee:
Xxxx Xxxxxx
0000 Xxxxxxxx Xxx. Xxxxx
Xxxxxxxxx, XX 00000
(b) If to the Corporation:
Netco Communications Corporation
000 Xxxxx Xxxxx
000 Xxxxx Xxxxxxxxxx Xxx
Xxxxxxxxxxx, XX 00000
Att'n: President
8. GENERAL PROVISIONS.
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8.1 Law Governing. This Agreement shall be governed by and construed
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according to the laws of the State of Minnesota.
8.2 Invalid Provisions. If any provision of this Agreement is held
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to be illegal, invalid, or unenforceable under present or future laws effective
during the term hereof, such provision shall be fully severable and this
Agreement shall be construed and enforced as if such illegal, invalid, or
unenforceable provision had never comprised a part hereof; and the remaining
provisions hereof shall remain in full force and effect and shall not be
affected by the illegal, invalid, or unenforceable provision or by its severance
herefrom. Furthermore, in lieu of such illegal, invalid, or unenforceable
provision there shall be added automatically as a part of this Agreement a
provision as similar in terms to such illegal, invalid, or unenforceable
provision as may be possible and still be legal, valid or enforceable.
8.3 Entire Agreement. This Agreement sets forth the entire
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understanding of the parties and supersedes all prior agreements or
understandings, whether written or oral, with respect to the subject matter
hereof. No terms, conditions, warranties, other than those contained herein,
and no amendments or modifications hereto shall be binding unless made in
writing and signed by the parties hereto.
8.4 Binding Effect. This Agreement shall extend to and be binding
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upon and inure to the benefit of the parties hereto, their respective heirs,
representatives, successors and assigns. This Agreement may not be assigned by
Employee.
8.5 Waiver. The waiver by either party hereto of a breach of any
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term or provision of this Agreement shall not operate or be construed as a
waiver of a subsequent breach of the same provision by any party or of the
breach of any other term or provision of this Agreement.
8.7 Titles. Titles of the paragraphs herein are used solely for
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convenience and shall not be used for interpretation or construing any word,
clause, paragraph, or provision of this Agreement.
8.8 Counterparts. This Agreement may be executed in two or more
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counterparts, each of which shall be deemed an original, but which together
shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Corporation and Employee have executed this
Agreement as of the date and year first written above.
"Employee" "Corporation"
Xxxx Xxxxxx Netco Communications Corporation
/s/ Xxxx Xxxxxx By:/s/ Xxxxxx X. Xxxxxxxx, III
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Xxxxxx X. Xxxxxxxx, III
Chief Executive Officer
