EXHIBIT 10.4
TANGIBLEDATA, INC.
EMPLOYMENT AGREEMENT
This Agreement entered into this 21st day of April 2000, by and between
TangibleData, Inc. ("Company") and Xxxx Xxxxxxxxx ("Employee"), effective on
the Effective Date.
WHEREAS, the parties desire by this writing to set forth the employment
relationship of the Company and the Employee.
NOW, THEREFORE, it is AGREED as follows:
1. Defined Terms
When used anywhere in the Agreement, the following terms shall have
the meaning set forth herein.
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Company" shall mean TangibleData, Inc., and any successor to
its interest.
(c) "Common Stock" shall mean common stock of the Company.
(d) "Confidential Information" shall mean any information that is
confidential, proprietary or trade secret information of Company or any of its
customers or clients or any other information the use or disclosure of which
by Company is prohibited or restricted (e.g., by reason of any contract, court
order, law or other obligation by which Company is bound). "Confidential
Information" may include, but is not necessarily limited to, technology,
computer programs, business plans, marketing plans, information as to existing
or future products or services of Company, financial projections, unpublished
works of original authorship, customer lists, financial information, and trade
secrets. "Confidential Information" shall not include any information in the
public domain if readily accessible to the public at large.
(e) "Disability" shall mean the practical inability of the Employee
to perform his obligations under this Agreement, whether from physical, mental
or other causes, for a period of ninety (90) days, determined in good faith by
the Board of Directors of the Company.
(f) "Effective Date" shall mean April 21, 2000.
(g) "Employee" shall mean Xxxx Xxxxxxxxx.
(h) "Good Reason" shall mean any of the following events, which has
not been consented to in advance by the Employee (i) a material reduction in
the Employee's base compensation as the same may be increased from time to
time (material shall mean greater than 15%); (ii) the failure by the Company
to continue to provide the Employee with benefits provided for on the
Effective Date, as the same may be increased from time to time, or with
benefits substantially similar to those provided to him under any of the
Employee benefit plans in which the Employee now or hereafter becomes a
participant, or the taking of any action by the Company which would directly
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or indirectly reduce any of such benefits or deprive the Employee of any
material fringe benefit enjoyed by him; (iii) a failure to elect or reelect
the Employee to the Board of Directors of the Company; (iv) a material
diminution or reduction in the Employee's responsibilities or authority
(including reporting responsibilities) in connection with his employment with
the Company; (v) a Change in Control.
(i) "Intellectual Property Right" shall mean any patent, copyright,
trade secret, trade name, trademark or other intellectual property right which
is owned by the Company.
(j) "Just Cause" shall mean, in the good faith determination of the
Company's Board of Directors (i) the Employee's willful misconduct, breach of
fiduciary duty involving personal profit, intentional failure to perform
stated duties, or conviction for a felony, or (ii) material breach of any
provision of this Agreement, provided that the Employee has been provided
written notice of specific deficiencies in his performance and at least thirty
days to cure those deficiencies. No act, or failure to act, on the Employee's
part shall be considered "willful" unless he has acted, or failed to act, with
an absence of good faith and without a reasonable belief that his action or
failure to act was in the best interests of the Company.
(k) "Materials" shall mean tangible manifestations of any
Confidential Information, Work Product, or Intellectual Property Rights
including, without limitation, hardware, software, programs, manuals,
drawings, designs, articles, writings, data, notes, memorandum, manuscripts,
notebooks, proposals, work plans, interim and final reports, project files and
client contract records.
(l) "Work Product" shall mean any invention, discovery, concept or
idea including, but not necessarily limited to, hardware, software programs,
or processes, techniques, know-how, methods, systems, improvements, analytical
reports, and other developments.
2. Employment.
The Employee shall render such services for the Company as described
by the Chief Executive Officer. The Employee's other duties shall be such as
the Board may from time to time reasonably direct, including normal duties as
an officer of the Company.
3. Base Compensation.
Commencing on the Effective Date of this Agreement, the Company
shall pay the Employee during the term of this Agreement a salary at the rate
of $90,000 per annum, payable in cash not less frequently than monthly. The
Board shall review, not less often than annually, the rate of the Employee's
salary, and in its sole discretion may decide to amend his salary. This same
compensation is agreed to on the assumption that Employee will devote 80% of
his time to the services of the Company, and will be adjusted, as appropriate,
if the Employee's time varies in fact.
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4. Annual Cash Bonuses.
The Company may establish a formula that is based on corporate
performance, and targets calendar year-end cash bonuses that are comparable on
a percentage basis to the bonuses given to similarly situated executives at
companies of a similar size and classification.
5. Other Benefits.
(a) Participation in Retirement, Medical and Other Plans. The
Employee shall be eligible to participate in any plan, subject to plan
requirements, that the Company may maintain for the benefit of its employees
if the plan relates to (i) pension, profit-sharing, or other retirement
benefits, (ii) medical insurance or the reimbursement of medical or dependent
care expenses, or (iii) other group benefits, including disability and life
insurance plans.
(b) Employee Benefits; Expenses. The Employee shall participate in
any fringe benefits which are or may become available to the Company's
Employees. The Employee shall be reimbursed for all reasonable out-of-pocket
business expenses which he shall incur in connection with his services under
this Agreement upon substantiation of such expenses in accordance with the
policies of the Company. The Company shall also pay for all dues and
subscriptions for trade memberships.
6. Term.
The Company hereby employs the Employee, and the Employee hereby
accepts such employment under this Agreement, for the period of one year
beginning April 21, 2000 and ending on April 20, 2001, hereinafter "Initial
Term." Employee shall give written notice to the Company through its Board of
Directors that this Agreement is scheduled to expire 120 days prior to the end
of the Initial Term or any Renewed Term. Unless the Company notifies the
Employee in writing 90 days prior to the expiration of the Initial Term or any
Renewed Term of its desire not to renew this Agreement, this Agreement shall
automatically continue for an additional 12-month period, herein "Renewal
Term" or, "Renewed Term."
7. Loyalty; Noncompetition; Work Product & Confidential Information.
(a) During the period of his employment hereunder and except for
illnesses, reasonable vacation periods, and reasonable leaves of absence, the
Employee shall devote his business time, attention, skill, and efforts to the
faithful performance of his duties hereunder; provided, however, from time to
time, Employee may serve on the boards of directors of, companies or
organization, which will not present any conflict of interest with the Company
or any of its subsidiaries or affiliates, or unfavorably affect the
performance of Employee's duties pursuant to this Agreement, or will not
violate any applicable statute or regulation. From the date of this Agreement
until the scheduled expiration date, including any renewal period, as set
forth in paragraph 6 of this Agreement, the Employee shall not engage in any
business or activity contrary to the business affairs or interests of the
Company.
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(b) Nothing contained in this Paragraph 7 shall be deemed to
prevent or limit the Employee's right to invest in the capital stock or other
securities of any business dissimilar from that of the Company, or, solely as
a passive or minority investor, in any business.
(c) In the course of the Employee's employment with Company, the
Employee will have access to certain Confidential Information. The Employee
will use and disclose Confidential Information solely for the purposes for
which it is provided and will take reasonable precautions to prevent any
unauthorized use or disclosure of the same. The Employee will not use or
disclose any Confidential Information (a) other than as required in the course
of the Employee's employment with the Company, (b) for the Employee's own
personal gain, or (c) in any manner contrary to the best interests of Company.
(d) The Employee will not use in the course of the Employee's
employment with Company, or disclose or otherwise make available to Company
any information, documents or other items which the Employee may have received
from any other person (e.g., a prior employer) and which the Employee is
prohibited from using, disclosing or making available (e.g., by reason of any
contract, court order, law or obligation by which the Employee is bound).
(e) All Materials and related Intellectual Property Rights will be
the sole and exclusive property of Company, whether or not such Materials are
marked with any Intellectual Property Right notice of Company or Employee.
All such Materials authored, made, conceived or developed by the Employee or
made available to the Employee (or any copies or extracts thereof) will be
held by the Employee in trust solely for the benefit of the Company. The
Employee will use such Materials only as required in the course of the
Employee's employment with Company or as otherwise authorized in writing by
Company.
(f) This Agreement does not apply to any invention for which no
equipment, supplies, facility or trade secret information of Company was used,
and which was developed entirely on Employee's own time, unless: (a) the
invention relates (i) directly to the Company or (ii) to Company's actual or
demonstrable anticipated research or development; or (b) the invention results
from any work performed by the Employee for the Company.
(g) All trade secrets, know-how, confidential information,
copyrightable material, inventions, discoveries, and improvements, including
computer programs (their structure, sequence, organization, coherence, look
and feel), whether patentable or unpatentable, copyrightable or
uncopyrightable, made, devised, discovered or reduced to practice by the
Employee during normal business hours utilizing the resources and materials of
the Company, whether by himself or jointly with others, from the time of
becoming an employee of the Company until the termination of that status
("Work Product"), shall be deemed work for hire and shall be promptly
disclosed in writing to the Company and are to redound to the benefit of the
Company and become and remain its sole and exclusive property.
(h) By executing this Agreement, Employee hereby transfers and
assigns to the Company, or persons, firms or corporations designated by the
Company, any or all of the Employee's rights, title and interest in and to any
and all developments, inventions, computer programs, discoveries,
improvements, processes, devices, copyrights, patents and patent applications
therefore, and to execute at any and all times any and all instruments and do
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any and all acts necessary or which the Company may deem desirable in
connection with conveying, transferring and assigning the Employee's entire
right, title and interest in and to any inventions, discoveries, improvements,
computer programs, processes, devices, copyrights, patent applications
therefore or patents thereon in any way related to the Work Product developed,
discovered or reduced to practice by the Employee during the term of this
Agreement, it being the express understanding and agreement of the parties
that any and all future developments, inventions and discoveries of the
Employee during the term hereof shall be the property of the Company, or its
assigns.
(i) Company may cause to be filed United States and foreign patent
and/or copyrights applications on each invention deemed to be patentable or
copyrightable and embodied in any technology developed and reduced to practice
during the term hereof which inure to the Company by virtue of the provisions
of this Agreement. Patent or copyright prosecution and maintenance shall be
done by an attorney to be selected by the Company and approved by the
Employee, which approval shall not be unreasonably withheld. All reasonable
expense of filing, prosecution and maintenance of domestic and foreign patents
or copyrights and patent or copyright applications shall be borne by Company.
All patents shall be applied for in the name of the Employee, as inventor, and
shall be assigned to the Company or its assigns. All copyrights shall be
registered in the name of the Company. The Employee shall, upon demand,
execute and deliver to the Company or its assigns such documents or
assignments as may be deemed necessary or advisable by counsel for the Company
or its assigns for filing in the appropriate patent offices to evidence the
assignment of the patent rights hereby granted.
(j) The Employee covenants to and with the Company, its successors
and assigns, that during the term of this Agreement, and for a 12 month period
thereafter, he will not directly or indirectly, either as principal, agent,
manager, employee, owner, partner (dominant or otherwise), stockholder,
director or other officer of a corporation, creditor, consultant or otherwise,
engage or become interested financially or otherwise, in any business, agency,
trade or occupation similar to or in competition with the Company or its
affiliates; nor shall the Employee, during the term of this Agreement consult
or enter into any agreement or arrangement with any other person, firm,
corporation or entity to conduct any research or development, nor shall the
Employee directly or indirectly conduct such research or development on his
own behalf, related to the discovery of processes, improvements, developments
or commercialization of any service or product developed or reduced to
practice during the period of employment with the Company, unless the Employee
shall have first obtained the Company's expressed written consent thereto
issued by the Board of Directors. Because of the nature of the business, the
parties agree that it is reasonable for this covenant to apply to the entire
geographic area of the United States. If the geographic area is determined by
a court to be overly broad in scope, it shall be modified only to the extent
necessary to bring it within the requirements of the law and interpreted to
give the Company the broadest protection allowed by law.
(k) The Employee covenants with the Company that employees of or
consultants to the Company and employees of and consultants to firms,
corporations or entities affiliated with the Company have, of necessity, been
exposed to and have acquired certain knowledge, understandings, and know-how
concerning the Company's business operations which is confidential information
and proprietary to the Company.
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(l) In order to protect the Company's confidential information and
to promote and insure the continuity of the Company's contractual relations
with its employees and consultants, the Employee covenants and agrees that for
so long as the Employee is affiliated with the Company as an officer,
director, employee, consultant, agent or contractor, he will not directly or
indirectly, or permit or encourage others to directly or indirectly (i)
interfere in any manner whatsoever with the Company's contractual or other
relations with any or all of its employees or consultants, or (ii) induce or
attempt to induce any employee or consultant to the Company to cease
performing services for or on behalf of the Company, or (iii) solicit, offer
to retain, or retain, or in any other manner engage or employ the services of,
or conduct any business activity in cooperation or association with, any
person or entity who at any time was employed by the Company, or any firm,
corporation or entity affiliated with the Company, except with the consent of
the Company issued by the Board of Directors.
(m) In order to protect the Company's proprietary rights and to
promote and ensure the continuity of the Company's contractual relations with
its customers and clients, the Employee covenants and agrees that, for so long
as the Employee is affiliated with the Company as an officer, director,
employee, consultant, agent or contractor, and for a 12 month period
thereafter, he will not directly or indirectly, or permit or encourage others
to directly or indirectly (i) interfere in any manner whatsoever with the
Company's contractual or prospective relations with any clients or customers,
or (ii) induce or attempt to induce any client or customer of the Company to
cease doing business with the Company, or (iii) solicit, offer to retain, or
retain, or in any other manner engage or enter into any business or other
arrangement with any of the Company's customers or clients to provide any
services or products to any of such customers or clients as they may from time
to time exist or be constituted, except and unless such arrangement for the
provision of products or services is not in any way competitive with the
products or services actually provided by the Company to its clients or
customers or circumstances to which the Company, through its Board of
Directors, has consented in writing, which consent shall not be unreasonably
withheld.
(n) In the event any court of competent jurisdiction determines or
holds that all or any portions of the covenants contained in this Section 7
are unlawful, invalid or unenforceable for any reason, then the parties hereto
agree to modify the provisions of this Section 7 if and only to the extent
necessary to render the covenants herein contained enforceable and otherwise
in conformance with all legal requirements.
8. Standards.
The Employee shall perform his duties under this Agreement in
accordance with such reasonable standards as the Board may establish from time
to time. The Company will provide Employee with the working facilities and
staff necessary for him to perform his duties.
9. Vacation and Sick Leave.
At such reasonable times as the Board shall in its discretion
permit, the Employee shall be entitled, without loss of pay, to absent himself
voluntarily from the performance of his employment under this Agreement, all
such voluntary absences to count as vacation time; provided that:
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(a) The Employee shall be entitled to an annual vacation in
accordance with the policies that the Board periodically establishes for
senior management executives of the Company.
(b) The Employee shall not receive any additional compensation from
the Company on account of his failure to take a vacation, and the Employee
shall not accumulate unused vacation from one fiscal year to the next, except
in either case to the extent authorized by the Board of Directors.
(c) In addition to the aforesaid paid vacations, the Employee shall
be entitled without loss of pay, to absent himself voluntarily from the
performance of his employment with the Company for such additional periods of
time and for such valid and legitimate reasons as the Board may in its
discretion determine. Further, the Board may grant to the Employee a leave or
leaves of absence, with or without pay, at such time or times and upon such
terms and conditions as such Board in its discretion may determine.
(d) In addition, the Employee shall be entitled to an annual sick
leave benefit as established by the Board.
10. Indemnification.
The Company and the Employee shall execute a separate Indemnity
Agreement, a copy of which is attached hereto as Exhibit A.
11. Termination and Termination Pay.
Subject to Section 11 hereof, the Employee's employment hereunder
may be terminated under the following circumstances:
(a) Just Cause. The Board may, by written notice to the Employee,
immediately terminate his employment at any time, for Just Cause. The
Employee shall have no right to receive compensation or other benefits for any
period after termination for Just Cause.
(b) Resignation by Employee without Good Reason. The Employee may
voluntarily terminate employment with the Company during the term of this
Agreement, upon at least 60 days' prior written notice to the Board of
Directors, in which case the Employee shall receive only his compensation,
vested rights and Employee benefits up to the date of his termination of
employment.
(c) Without Just Cause/Resignation for Good Reason. Subject to
Sections 11(a), 11(b) and 13 hereof, the Board may, by written notice to the
Employee, immediately terminate his employment at any time for a reason other
than Just Cause; in addition, the Employee may immediately terminate
employment with the Company during the term of this Agreement for Good Reason,
and in both events, from the time of termination the Employee shall be
entitled to receive the following compensation and benefits; (i) the salary
provided pursuant to Section 3 hereof, up to the expiration date (the
"Expiration Date") of the term, including any Renewal Term, if the term is
extended, of this Agreement, (ii) the cost to the Employee of obtaining all
health, life, disability and other benefits which the Employee would have been
eligible to participate in through the Expiration Date based upon the benefit
levels substantially equal to those that the Company provided for the
Employee, either in periodic payments over the remaining terms of this
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Agreement, as if the Employee's employment had not been terminated, or in one
lump sum within 10 days of such termination.
(d) Death or Disability. The Employee's employment under this
Agreement shall terminate upon his death or Disability during the term of this
Agreement.
12. No Mitigation. The Employee shall not be required to mitigate the
amount of any payment provided for in this Agreement by seeking other
employment or otherwise and no such payment shall be offset or reduced by the
amount of any compensation or benefits provided to the Employee in any
subsequent employment.
13. Disputes/Arbitration
(a) Any dispute, claim or controversy arising out of this Agreement
or its breach shall be settled by arbitration in Denver, Colorado by a single
arbitrator licensed to practice law, who shall be chosen by mutual agreement
of the parties. The arbitration is not required to be filed with the American
Arbitration Association ("AAA"), but the arbitrator may follow the rules and
procedures of the AAA, as agreed by the parties. The arbitration hearing
shall be held no later than 60 days after the arbitration is initiated. The
arbitrator's decision and award shall be final and binding, and judgement upon
the award may be entered in any court of appropriate jurisdiction.
(b) The prevailing party in any arbitration shall be reimbursed for
all costs and expenses, including reasonable attorneys' fees, arising from the
dispute, claim or controversy that is arbitrated, provided that the prevailing
party shall obtain a final arbitration award in its favor. Such reimbursement
shall be paid within ten (10) days of the prevailing party's furnishing to the
other party written evidence, which may be in the form, among other things, of
a canceled check or receipt, of any costs or expenses incurred by the
prevailing party. The costs and expenses may be part of the arbitration
award.
14. Successors and Assigns.
(a) This Agreement shall inure to the benefit of and be binding
upon any corporate or other successor of the Company which shall acquire,
directly or indirectly, by merger, consolidation, purchase or otherwise, all
or substantially all of the assets or stock of the Company.
(b) Since the Company is contracting for the unique and personal
skills of the Employee, the Employee shall be precluded from assigning or
delegating his rights or duties hereunder without first obtaining the written
consent of the Company, through its Board of Directors.
15. Corporate Authority.
Company represents and warrants that the execution and delivery of
this Agreement by it has been duly and properly authorized by the Company's
Board of Directors and that when so executed and delivered this Agreement
shall constitute the lawful and binding obligation of the Company.
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16. Amendments.
No amendments or additions to this Agreement shall be binding unless
made in writing and signed by all of the parties, except as herein otherwise
specifically provided.
17. Applicable Law.
Except to the extent preempted by Federal law, the laws of the State
of Colorado shall govern this Agreement in all respects, whether as to its
validity, construction, capacity, performance or otherwise.
18. Severability.
The provisions of this Agreement shall be deemed severable and the
invalidity or unenforceability of any provision shall not affect the validity
or enforceability of the other provisions hereof.
19. Entire Agreement.
This Agreement, together with any understanding or modifications
thereof as agreed to in writing by the parties, shall constitute the entire
Agreement between the parties hereto.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day
and year first hereinabove written.
ATTEST: TANGIBLEDATA, INC.
____________________________ By:/s/ Xxxxx Xxxxx
Secretary Title: President and CEO
WITNESS:
____________________________ /s/ Xxxx Xxxxxxxxx
Xxxx Xxxxxxxxx
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