CHEYENNE SOFTWARE, INC. EMPLOYMENT AGREEMENT
Employee: Xxxxxxx X. Xxxxx
EMPLOYMENT AGREEMENT made effective this 1st day of July, 1995
(hereinafter referred to as "Employment Agreement") between Cheyenne Software,
Inc., a Delaware corporation (hereinafter referred to as the "Corporation") and
Xxxxxxx X. Xxxxx with an address at 00 Xxxxxxxx Xxxx, Xxxx Xxxxxxxxxx, XX 00000
(hereinafter referred to as the "Employee").
WHEREAS, the Employee has substantial experience as a corporate
attorney;
WHEREAS, the Employee desires to be employed by the Corporation as Vice
President and General Counsel, and the Corporation desires that the Employee be
so employed, upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements hereinafter set forth, the parties intending to be
legally bound, agree as follows:
1. Term of Employment. Subject to the approval of the Corporation's
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Board of Director's, the Corporation hereby employs the Employee as Vice
President and General Counsel, and the Employee hereby agrees to serve the
Corporation in such capacity for the period commencing on the date first written
above, (the "Effective Date"), and ending on June 30, 1997 (hereinafter referred
to as the "Employment Period"), unless sooner terminated as hereinafter
provided.
2. Scope of Duties. The Employee shall serve as Vice President and
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General Counsel and shall be responsible for management of the legal affairs of
the Corporation. The Employee shall report and be responsible to the Chief
Financial Officer or other person designated by the President or the Board of
Directors. The Employee's performance shall be reviewed annually.
3. Time To Be Devoted to Employment. The Employee shall, except during
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vacation periods or absences due to temporary illness, devote substantially all
of his professional and business time, attention and energies to his duties and
responsibilities hereunder, and except for business trips which shall be
necessary or desirable in the Corporation's business, shall render such services
at the principal office of the Corporation. Nothing herein contained shall
prevent or be construed as preventing the Employee from holding or purchasing
five (5%) percent or less of any class of stock or securities of a corporation
which is listed on a national securities exchange or regularly traded in the
over-the-counter market, or making other investments or participating in
business ventures not in competition with the business of the Corporation, as
long as such investments and business ventures shall not require any time during
normal business hours and do not conflict with his duties or obligations to the
Corporation as provided in this Employment Agreement.
4. Direct Compensation. (a) In consideration for services rendered and
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to be rendered by the Employee hereunder during the Employment Period, the
Employee shall receive a salary of One Hundred Twenty Thousand ($120,000)
Dollars per year, which shall be paid semi-monthly ($5,000.00) in arrears or at
such other intervals as other employees are paid.
(b) Employee shall be eligible to receive additional payments or
bonuses which will be determined by Cheyenne's top management and Board of
Directors based on personal and corporate objectives and achievements.
5. Fringe Benefits. The Employee shall be entitled to participate in
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any and all fringe benefits and/or plans, generally afforded to other employees
of the Corporation (to the extent the Employee otherwise qualifies therefor
under the specific terms and conditions of each such benefit), including,
without limitation, group disability, life insurance, medical insurance and
pension plans (401K) which are, or which may become available generally to
senior personnel of the Corporation. The Employee shall be entitled to unlimited
vacation time during each year of the Employment Period. The Corporation shall
reimburse the Employee in an amount equal to $500 per month for expenses
relating to an automobile used by the Employee in connection with the business
of the Corporation.
6. Termination of Employment. During the Employment Period, the
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Employee's employment may be terminated by the President, the Board of
Directors or the Executive Committee of the Corporation on the occurrence of
any one or more of the following events:
a. The death of the Employee;
b. The failure by the Employee to substantially perform his
duties and hereunder, owing to physical or mental incapacity (hereinafter
referred to as "disability"), which disability shall continue for more than four
(4) consecutive months or an aggregate or more than six (6) months in any
calendar year; or
c. For "Cause", which shall mean (i) the willful failure by
the Employee to substantially perform his duties hereunder (including the breach
of any provision of Section 9 and/or 10 hereof), for reasons other than death or
disability; (ii) the willful engaging by the Employee in misconduct materially
injurious to the Corporation; or (iii)
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the commission by the Employee of an act constituting common law fraud or a
felony against the Corporation.
7. Death Benefit. In addition to all other insurance and similar death
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benefits generally made available to employees of the Corporation, if Employee's
death occurs during the term of the Employment Period, the Corporation shall
provide a death benefit to the estate of the Employee equal to one hundred
percent (100%) of the Employee's then current annual Base Salary at the date of
death. Such death benefit shall be payable as may be determined by the
Corporation, but not less often than twelve (12) equal monthly installments,
payable on the last day of each month, commencing in the month subsequent to the
month in which the death occurs.
8. Severance Payment. (a) If the Corporation and the Employee do not
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enter into a renewal agreement to be effective July 1, 1997 for a period of at
least two years and containing similar terms and conditions to those set forth
herein, then the Corporation will pay the Employee, as additional compensation,
an amount equal to thirty (30%) of the Employee's then current annual Base
Salary, as determined under Section 4, payable semi-monthly in arrears for the
six months ending December 31, 1997; such compensation is hereunder referred to
as the "Severance Payment".
(b) Notwithstanding the provisions of Section 8 (a) above, the
Employee will not receive the Severance Payment if,
(i) the Corporation declines to enter into a renewal agreement
with the Employee because the Employee breached the confidentiality and/or
non-compete provisions of this Agreement or any other terms or conditions of
his employment;
(ii) the Employee has been terminated for Cause hereunder; or
(iii) the Employee declines to enter into a renewal agreement
with the Corporation, and the Corporation has offered a renewal agreement for
a period of not less than two years, containing similar terms and conditions as
discussed herein.
9. Disclosure of Information. All memoranda, notes, records or other
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documents made or compiled by the Employee or made available to him during
the term of his employment concerning the business of the Corporation shall be
the Corporation's property and shall be delivered to the Corporation on the
termination of the Employee's employment. The Employee shall not use for himself
or others, or divulge to others, any proprietary or confidential information of
the Corporation, obtained by him as a result of his employment, unless
authorized by the Corporation. For purposes of this Section 9, the term
"proprietary or confidential information" shall mean all information which is
known only to the Employee or to the Employee and the employees, former
employees, consultants or others in a confidential relationship with the
Corporation and relates to
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specific matters such as trade secrets, marketing
programs, customers, potential customers and vendor lists, pricing and credit
techniques, program codes, software design know-how, research and development
activities, private processes, and books and records, as they may exist from
time to time, which the Employee may have acquired or obtained by virtue of work
heretofore or hereafter performed for or on behalf of the Corporation or which
he may acquire or may have acquired knowledge of during the performance of said
work, and which is not known to others, or readily available to others from
sources other than the Employee or officers or other employees of the
Corporation, or is not in the public domain. In the event of a breach or a
threatened breach by the Employee of the provisions of this Section 9, the
Corporation shall be entitled to an injunction restraining the Employee from
disclosing, in whole or in part, the aforementioned proprietary or confidential
information of the Corporation, or from rendering any services to any person,
firm, corporation, association or other entity to whom such proprietary or
confidential information, in whole or in part, has been disclosed or is
threatened to be disclosed. Nothing herein contained shall be construed as
prohibiting the Corporation from pursuing any other remedies available to the
Corporation for such breach or threatened breach, including the recovery of
damages from the Employee.
10. Restrictive Covenants. (a) The Employee hereby acknowledges and
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recognizes the highly competitive nature of the Corporation's business and
accordingly agrees that, in consideration of the premises contained herein, he
will not during the Employment Period, until the Designated Date (as hereinafter
defined): (i) directly or indirectly engage in any Competitive Activity (as
hereinafter defined), whether such engagement shall be as an officer, director,
employee, consultant, agent, lender, stockholder, or other participant; or (ii)
assist others in engaging in Competitive Activity. As used herein, the term
"Competitive Activity" shall mean and include the development and/or marketing
of computer hardware and/or software for server-based local area network (LAN)
and enterprise wide applications, including but not limited to storage
management, data management/monitoring, data security and data communications.
(b) As used in this Section 10, the "Designated Date" shall mean the
following:
(i) if the Employee willfully terminates his employment with
the Corporation in violation of this Employment Agreement prior to the
expiration of the Employment Period, then the "Designated Date" shall mean the
second (2nd) anniversary of the effective date of such termination;
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(ii) if the Corporation terminates the employment of the
Employee under this Employment Agreement for cause, then the "Designated Date"
shall be the second (2nd) anniversary of the effective date of such termination;
or
(iii) if the Corporation, after the Employment Period,
terminates the employment of the Employee without cause, then the term
"Designated Date" shall mean the effective date of such termination.
(c) It is the desire and intent of the parties that the provisions of
this Section 10 shall be enforced to the fullest extent permissible under the
laws and public policies applied in each jurisdiction in which enforcement is
sought. Accordingly, if any particular provision of this Section 10 shall be
adjudicated to be invalid or unenforceable, such provision of this Section 10
shall be deemed amended to delete therefrom the portion thus adjudicated to be
invalid or unenforceable, such deletion to apply only with respect to the
operation of such provisions of this Section 10 in the particular jurisdiction
in which such adjudication is made. In addition, if the scope of any restriction
contained in this Section 10 is too broad to permit enforcement thereof to its
fullest extent, then such restriction shall be enforced to the maximum extent
permitted by law, and the Employee hereby consents and agrees that such
restriction shall be enforced to the maximum extent permitted by law, and the
Employee hereby consents and agrees that such scope may be judicially modified
accordingly in any proceeding brought to enforce such restriction.
(d)
(i) Employee shall promptly disclose to Employer all
Inventions (as defined below) and keep accurate records relating to the
conception and reduction to practice of all Inventions. A report shall be
submitted by Employee upon completion of any studies or research projects
undertaken on Employer's behalf whether or not in the Employee's opinion a given
project has resulted in an Invention. Such records shall be the sole and
exclusive property of Employer, and the Employee shall surrender possession of
the records to Employer upon any suspension or termination of Employee's
employment with Employer.
(ii) Employee hereby assigns to Employer, without additional
consideration to Employee, the entire right, title and interest in and to the
Inventions and Work Product (as defined below) and in and to all copyrights,
patents, trademarks and any and all other proprietary rights therein or based
thereon. Employee agrees that the Work Product shall be deemed to be a "work
made for hire." Employee shall execute all such assignments, oaths, declarations
and other documents as may be prepared by Employer to obtain and maintain United
States and/or foreign letters patent or other
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registrations in connection with any Invention or Work Product, to vest the
entire right in any Invention or Work Product and related applications and
registrations in Employer and to otherwise effect the foregoing.
(iii) Employer, without additional consideration to Employee,
shall have the exclusive worldwide and perpetual right to use, make, and sell
products and/or services derived from any Inventions, Work Product and other
discoveries, concepts, ideas, applications, methods, formulas, techniques,
improvements or know-how, whether or not within the scope of Inventions or Work
Product but which are obtained, created or made by the Employee during the
Employment Period.
(iv) Employee shall provide Employer with all information,
documentation, and assistance Employer may request to perfect, enforce or defend
the proprietary rights in or based on the Inventions and Work Product. Employer,
in its sole discretion, shall determine the extent of the proprietary rights, if
any, to be protected in or based on the Inventions and Work Product. All such
information, documentation and assistance shall be provided by Employee at no
additional expense to Employer, except for out-of-pocket expenses which Employee
incurred at Employer's request.
(v) Inventions shall mean all inventions, processes, methods,
formulas, techniques, improvements, modifications and enhancements, whether or
not patentable, made or conceived by Employee, whether or not during the hours
of Employee's employment or with the use of Employer's facilities, materials or
personnel, either solely or jointly, during Employee's employment by Employer,
or within one year after termination of such employment, or within two years
after termination of such employment if such termination is based on or related
to unauthorized use or disclosure of proprietary or confidential information by
the Employee.
(vi) Work Product shall mean all documentation, software,
creative works, know-how and information created, in whole or in part, by
Employee during Employee's employment by Employer, whether or not copyrightable
or otherwise protectable, excluding Inventions.
(e) If there is a breach or threatened breach by the Employee of the
provisions of this Section 10, the Corporation shall be entitled to an
injunction restraining him from such breach. Nothing herein contained shall be
construed as prohibiting the Corporation from pursuing any other remedies
available for such breach or threatened breach or any other breach of this
Employment Agreement.
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(f) Employee hereby warrants and represents that he is not prohibited
by any agreement or the order of any court from entering into and carrying out
the terms of this Agreement. In particular, the Employee, warrants and
represents that the scope of his activity is not restricted in any way with
respect to the design, development, enhancement, sale, marketing and/or
promotion of computer software and hardware.
11. (a) Notices. All notices required or permitted to be given under
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the provisions of this Employment Agreement shall be in writing and delivered
personally or by certified or registered mail, return receipt requested, postage
prepaid to the following persons at the following addresses, or to such other
persons at such other addresses as any party may request by notice in writing to
the other party to this Agreement:
If to Employee:
Xxxxxxx X. Xxxxx
00 Xxxxxxxx Xxxx
Xxxx Xxxxxxxxxx, XX 00000
If to the Corporation:
Cheyenne Software, Inc.
0 Xxxxxxxxxx Xxxxx
Xxxxxx Xxxxxxx, XX 00000,
Att: President
With a copy to:
Xxxxxxx Xxxxxx, Esq.
Xxxxxxxx Xxxxx Singer & Xxxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
(b) Construction. This Employment Agreement shall be construed with,
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and be governed by, the laws of the State of New York for contracts entered into
and to be performed in New York, without regard to principles of conflicts of
law.
(c) Successors and Assigns. This Employment Agreement shall be binding
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on the successors and assigns of the Corporation and shall inure to the benefit
and be enforceable by and against its successors and assigns. This Employment
Agreement is personal in nature and may not be assigned or transferred by the
Employee without the prior written consent of the Corporation.
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(d) Entire Agreement. This instrument contains the entire understanding
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and agreement between the parties relating to the subject matter hereof and all
prior oral and written agreements are extinguished, and neither this Employment
Agreement nor any provision hereof may be waived, modified, amended, changed,
discharged or terminated, except by an agreement in writing signed by the party
against whom enforcement of any waiver, modification, change, amendment,
discharge or termination is sought.
(e) Counterparts. This Employment Agreement may be executed
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simultaneously in counterparts, each of which shall be deemed an original, and
all of which counterparts shall together constitute a single agreement.
(f) Illegality. If any one or more of the provisions of this Employment
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Agreement shall be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
(g) Captions. The captions of the sections hereof are for convenience
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only and shall not control or affect the meaning or construction of any of the
terms or provisions of this Employment Agreement.
IN WITNESS WHEREOF, the parties hereto have set their hands and
executed this Agreement the day and year first above written.
CHEYENNE SOFTWARE, INC.
By: /s/ XxxXxxx Xxxx
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XxxXxxx Xxxx, President
By: /s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx
