Employment Agreement (the "Agreement"), dated as of December 31, 1999 (the
"Effective Date"), between eB2B Commerce, Inc., a Delaware corporation with
principal offices at ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, (the
"Company") and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ residing at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇,
("▇▇▇▇▇▇▇▇▇"). The Company and ▇▇▇▇▇▇▇▇▇ may be referred to herein collectively
as the "Parties" or individually as a "Party."
WHEREAS, the Company is engaged in the sales and service of building,
owning and operating electronic commerce networks; and
WHEREAS, the Company desires to obtain the services of ▇▇▇▇▇▇▇▇▇ as Chief
Information Officer, and ▇▇▇▇▇▇▇▇▇ is willing to render such services to the
Company upon the terms and conditions herein set forth.
NOW, THEREFORE, in consideration of the mutual covenants herein set forth,
the Parties do hereby agree as follows:
1 Employment. The Company hereby employs ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇ hereby
accepts employment upon the terms and conditions hereinafter set forth.
2 Term. The term of this Agreement (the "Term") shall be the period
commencing on January 3, 2000 and terminating as of the earlier of:
2.1 December 31, 2002;
2.2 the death or disability of ▇▇▇▇▇▇▇▇▇;
2.3 sixty (60) days after notice is given by the Company to ▇▇▇▇▇▇▇▇▇; or
2.4 sixty (60) days after notice is given by ▇▇▇▇▇▇▇▇▇ to the Company.
The exercise of the Company's or ▇▇▇▇▇▇▇▇▇ right to terminate this
Agreement pursuant to Sections 2.3 or 2.4 hereof, as the case may be,
shall not abrogate the rights and remedies of the terminating party.
3 Duties. ▇▇▇▇▇▇▇▇▇ shall be engaged as Chief Information Officer of the
Company and, subject to the direction of the Board of Directors and the
Company's officers designated by the Board of Directors, shall perform and
discharge well and faithfully the duties which may be assigned to him from time
to time by the Company in connection with the conduct of its business. If
▇▇▇▇▇▇▇▇▇ is elected or appointed a director or officer of the Company or any
subsidiary thereof during the term of this Agreement, ▇▇▇▇▇▇▇▇▇ will serve in
such capacity without further compensation.
4 Extent of Services. ▇▇▇▇▇▇▇▇▇ shall devote his entire time, attention and
energies to the business of the Company and shall not during the Term of this
Agreement be engaged (whether or not during normal business hours) in any other
business or professional activity, whether or not such activity is pursued for
gain, profit or other pecuniary advantage; but this shall not be construed as
preventing ▇▇▇▇▇▇▇▇▇ from (i) investing his personal assets in businesses which
do not compete with the Company in such form or manner as will not require any
services on the part of ▇▇▇▇▇▇▇▇▇ in the operation or the affairs of the
companies in which such investments are made and in which his participation is
solely that of an investor; (ii) purchasing securities in any corporation whose
securities are regularly traded provided that such purchase shall not result in
his collectively owning beneficially at any time five (5%) percent or more of
the equity securities of any corporation engaged in a business competitive to
that of the Company; and (iii) participating in conferences, preparing or
publishing papers or books or teaching so long as the Board of Directors
approves of such activities prior to
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▇▇▇▇▇▇▇▇▇'▇ engaging in them. Prior to commencing any activity described in
clause (iii) above, ▇▇▇▇▇▇▇▇▇ shall inform the Board of Directors of the Company
in writing of any such activity.
5 Compensation. For all services rendered under this Agreement the Company
will pay ▇▇▇▇▇▇▇▇▇ the compensation described in this Section 5.
5.1 Base Salary. During the Term of this Agreement, the Company shall pay
▇▇▇▇▇▇▇▇▇ a base salary of one hundred fifty thousand ($150,000) dollars per
year (the "Base Salary"). The Company agrees that commencing in 2001 the Base
Salary will increase annually in an amount no less than five (5%) percent of the
previous year's base salary. The Base Salary shall be payable to ▇▇▇▇▇▇▇▇▇ in
accordance with the Company's standard payroll policy for similarly situated
employees of the Company.
5.2 Bonus.
5.2.1 Signing Bonus. Upon the execution of this Agreement, ▇▇▇▇▇▇▇▇▇
will be entitled to the sum of ten thousand ($10,000) dollars as a signing bonus
from the Company ("Signing Bonus"). The Company will pay the Signing Bonus to
▇▇▇▇▇▇▇▇▇ ratably over a three (3) month period, commencing upon the Effective
Date.
5.2.2 Annual Bonus. ▇▇▇▇▇▇▇▇▇ may receive, from time to time, bonus
compensation from the Company, as directed by the Board of Directors following
the negotiation of the terms by the Parties (the "Bonus Compensation"). If at
any time hereafter the Company shall adopt a bonus program, an option program or
any other form of equity participation for senior executives of the Company,
▇▇▇▇▇▇▇▇▇ shall be eligible to participate in such program in a manner and
capacity commensurate with his position and duties. Notwithstanding the
foregoing, for the 2000 calendar year, the Company will pay ▇▇▇▇▇▇▇▇▇ a bonus of
up to one hundred thousand ($100,000) dollars ("Maximum Bonus"), and no less
than fifty thousand ($50,000) dollars ("Minimum Bonus") based on the pro rata
achievement of the performance goals set by the Company, attached hereto as
Exhibit A. For each calendar year thereafter, the Company will pay ▇▇▇▇▇▇▇▇▇ the
Minimum Bonus. The Minimum Bonus will be paid to ▇▇▇▇▇▇▇▇▇ ratably at the end of
each calendar quarter in the current calendar year. Any bonus amount above the
Minimum Bonus will be payable by March 15th of the following calendar year.
5.3 Stock Options. ▇▇▇▇▇▇▇▇▇ shall be entitled to a grant by the Company of
options to purchase one hundred thousand (100,000) shares of the Common Stock of
the Company pursuant to the terms of the Company's Incentive Stock Option Plan
and Incentive Stock option Agreement ("Options"). The options will be
exercisable at a price of $5.50 per share, and will vest as follows: (i)
thirty-three and one-third (33 1/3%) percent upon the date of this Agreement,
and (ii) sixty-six and two-thirds (66 2/3%) percent ratably at the end of each
quarter ▇▇▇▇▇▇▇▇▇ is employed by the Company over a two (2) year period
commencing upon the Effective Date, all subject to the terms of the Incentive
Stock Option Agreement. The Incentive Stock Option Agreement evidencing the
grant of the Options will be provided separately.
6 Benefits.
6.1 Health Insurance; Vacation. The Company shall provide ▇▇▇▇▇▇▇▇▇ with
health insurance coverage, personal time and other benefits during the term of
this Agreement as agreed upon by the Board, but in no event will such benefits
be less than those offered to other employees of the Company. ▇▇▇▇▇▇▇▇▇ shall be
entitled to four (4) weeks paid vacation during each year of this Agreement.
6.2 Car Allowance. The Company will pay to ▇▇▇▇▇▇▇▇▇ a car allowance of
four hundred ($400) dollars per month.
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6.3 Life Insurance. The Company shall have the right at its own expense and
for its own benefit to purchase insurance on ▇▇▇▇▇▇▇▇▇'▇ life, and ▇▇▇▇▇▇▇▇▇
shall cooperate by providing necessary information, submitting to required
medical examinations, and otherwise complying with the insurance carrier's
requirements.
7 Expenses. ▇▇▇▇▇▇▇▇▇ shall be entitled to reimbursement of all reasonable
expenses incurred by him in the performance of or in furtherance of his duties,
subject to the presenting of appropriate vouchers in accordance with the
Company's policy.
8 Confidential Information. ▇▇▇▇▇▇▇▇▇ hereby agrees and acknowledges that the
following information and materials, whether in written, oral, magnetic,
photographic, optical or other form and whether now existing or developed or
created during the period of ▇▇▇▇▇▇▇▇▇'▇ employment or engagement with the
Company, excepting information obtained by ▇▇▇▇▇▇▇▇▇ from general or public
sources, are proprietary to the Company and are highly confidential in nature
(the "Confidential Information"):
8.1 Business Records, Marketing Plans and Customer Information. All books,
records, documents, memoranda and materials, and the information contained
therein directly relating to the business and finances of the Company including,
but not limited to: (i) marketing and development plans, forecasts, forecast
assumptions, forecast volumes, future plans and potential strategies of the
Company; (ii) cost objectives, pricing policies and procedures, quoting policies
and procedures, and unpublished price lists; (iii) licensing policies,
strategies and techniques; (iv) customer lists, names of past, present and
prospective customers and their representatives; (v) data and other business
information about or provided by past, present and prospective customers; (vi)
names of past, present and prospective vendors and their representatives, data
and other information about or provided by past, present and prospective
vendors; (vii) purchasing information, orders, invoices, ▇▇▇▇▇▇▇▇, and payment
of ▇▇▇▇▇▇▇▇; (viii) past, present and prospective licenses and licensees, the
terms and conditions of any licenses or prospective licenses, contracts or
prospective contracts; (ix) types of products, supplies, materials and services
purchased, leased, licensed and/or sold by the Company; (x) past, present and
future research and development arrangements; (xi) customer service information;
(xii) joint ventures, mergers and/or acquisitions; (xiii) the Company personnel
policies and procedures, the Company personnel files, and the compensation of
officers, directors and employees of the Company; and (xiv) all other
confidential business records and trade secrets of the Company.
8.2 Technology and Manufacturing Procedures. All books, records, documents,
memoranda and materials, and the information contained therein, relating to the
technology of the Company (whether or not patentable, whether or not protected
by copyright, whether developed by or for the Company) including, but not
limited to: (i) ideas and concepts for existing and new products, processes and
services; (ii) specifications for products, equipment and processes, whether
technical or financial; (iii) manufacturing and performance specifications and
procedures; (iv) engineering drawings, flow charts, and graphs; (v) technical,
research and engineering data; (vi) formulations, materials, and material
specifications; (vii) laboratory studies and benchmark tests; (viii) laboratory
notebooks; (ix) plant layout and equipment; (x) manuals, including service
manuals and operation manuals; (xi) quality assurance policies, procedures and
specifications; (xii) validation studies; and (xiii) all other know-how,
methodology, procedures, techniques and trade secrets related to the research,
engineering and development affairs of the Company.
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8.3 Third Party Information. Any and all other information and materials in
the Company's possession or under its control from any other person or entity
which the Company is obligated to treat as confidential or proprietary ("Third
Party Information").
8.4 Not Generally Known. Any and all Confidential Information not generally
known to the public or within the industries or trades in which the Company
competes.
9 General Skills and Knowledge. The general skills and experience gained by
▇▇▇▇▇▇▇▇▇ during ▇▇▇▇▇▇▇▇▇'▇ employment with the Company, and information
publicly available or generally known within the industries or trades in which
the Company competes, is not considered Confidential Information.
10 ▇▇▇▇▇▇▇▇▇'▇ Obligations as to Confidential Information and Materials.
During ▇▇▇▇▇▇▇▇▇'▇ employment by the Company, ▇▇▇▇▇▇▇▇▇ will have access to
Confidential Information and will occupy a position of trust and confidence with
respect to the Company's affairs and business. ▇▇▇▇▇▇▇▇▇ agrees to take the
following steps to preserve the confidential and proprietary nature of the
Confidential Information:
10.1 Non-Disclosure. During and for a period of three (3) years after
▇▇▇▇▇▇▇▇▇'▇ employment with the Company, ▇▇▇▇▇▇▇▇▇ will not use, disclose or
otherwise permit any person or entity access to any of the Confidential
Information other than as required in the performance of ▇▇▇▇▇▇▇▇▇'▇ duties with
the Company.
10.2 Prevent Disclosure. ▇▇▇▇▇▇▇▇▇ will take all reasonable precautions to
prevent disclosure of the Confidential Information in accordance with the
Company's reasonable instructions to ▇▇▇▇▇▇▇▇▇.
10.3 Return all Materials. Upon termination of ▇▇▇▇▇▇▇▇▇'▇ employment with
the Company, for any reason whatsoever, ▇▇▇▇▇▇▇▇▇ will deliver to the Company
all tangible materials embodying the Confidential Information, including,
without limitation, any documentation, records, listings, notes, data, sketches,
drawings, memoranda, models, accounts, reference materials, samples,
machine-readable media and equipment which in any way relate to the Confidential
Information.
11 Ideas and Inventions. ▇▇▇▇▇▇▇▇▇ agrees that all right, title and interest
in or to any and all Inventions are the property of the Company. For the
purposes of this Agreement, "Inventions" shall mean all ideas, concepts,
know-how, techniques, processes, methods, inventions, discoveries, developments,
innovations and improvements (i) conceived or made by ▇▇▇▇▇▇▇▇▇, whether alone
or with others, in the course of ▇▇▇▇▇▇▇▇▇'▇ employment by the Company, or (ii)
conceived or made by ▇▇▇▇▇▇▇▇▇, whether alone or with others, in the course of
▇▇▇▇▇▇▇▇▇'▇ employment, but which reach fruition within the period from the date
of termination of ▇▇▇▇▇▇▇▇▇'▇ employment through the second (2nd) anniversary of
such date, and which either (a) involve or are reasonably related to the
business of the Company or to the Company's actual or demonstrably anticipated
research or development; or (b) incorporate or are derived from, in whole or in
part, any of the Confidential Information. ▇▇▇▇▇▇▇▇▇ agrees to promptly disclose
all Inventions to the Company, and to provide all assistance reasonably
requested by the Company in the preservation of its interests in the Inventions,
such as by executing documents, testifying, etc. ▇▇▇▇▇▇▇▇▇ agrees to execute,
acknowledge and deliver any instruments confirming the complete ownership by the
Company of such Inventions. Such assistance shall be provided at the Company's
expense without any additional compensation to ▇▇▇▇▇▇▇▇▇.
12 Post-Employment Procedures. ▇▇▇▇▇▇▇▇▇ agrees that, upon the termination of
his employment with the Company, he will (i) participate in good faith in the
Company's exit interview process; and (ii) enter into an appropriate Employment
Termination Agreement, in
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which, among other things, ▇▇▇▇▇▇▇▇▇ will represent to the Company that he has
fully complied with the terms of this Agreement and that he will fulfill the
then-executory obligations contained in this Agreement.
13 Copyrights. ▇▇▇▇▇▇▇▇▇ agrees that any work prepared for the Company which
is protected under United States Copyright laws or under the universal Copyright
Convention, the Berne Copyright convention and/or the Buenos Aires Copyright
Convention shall be a work made for hire and ownership of all copyrights
(including all renewals and extensions) therein shall vest in the Company. In
the event any such work is deemed not to be a work made for hire for any reason,
▇▇▇▇▇▇▇▇▇ hereby grants, transfers and assigns all right, title and interest in
such work and all copyrights in such work and all renewals and extensions
thereof to the Company, and agrees to provide all assistance reasonably
requested by the Company in the establishment, preservation and enforcement of
its copyright in such work, such assistance to be provided at the Company's
expense but without any additional compensation to ▇▇▇▇▇▇▇▇▇. ▇▇▇▇▇▇▇▇▇ hereby
agrees to and does hereby waive all moral rights with respect to the work
developed or produced hereunder, including, without limitation any and all
rights of identification of authorship and any and all rights of approval,
restriction, or limitation on use or subsequent modifications.
14 Conflicting Obligations and Rights. Before (i) performing any obligations,
▇▇▇▇▇▇▇▇▇ may have to preserve the confidentiality of another's proprietary
information or materials, or (ii) exercising any rights ▇▇▇▇▇▇▇▇▇ may claim to
any patent or copyright trade secrets, or other discoveries, inventions, ideas,
know-how, techniques methods, processes or other proprietary information or
materials before performing that work, ▇▇▇▇▇▇▇▇▇ shall inform the Company in
writing of any apparent conflict between ▇▇▇▇▇▇▇▇▇'▇ work for the Company and
such other obligations and/or rights. In the absence of such written notice, the
Company may conclude that no such conflict exists and ▇▇▇▇▇▇▇▇▇ agrees
thereafter to make no such claim against the Company. The Company shall hold
such disclosures by ▇▇▇▇▇▇▇▇▇ in strict confidence.
15 Restrictive Covenants.
15.1 ▇▇▇▇▇▇▇▇▇ acknowledges that (i) the Company's business is all aspects
of business-to-business electronic commerce, but not limited to, building,
owning and operating electronic commerce networks; and providing systems
integration and consulting services relating thereto, and that (ii) fulfillment
of the obligations hereunder will result in ▇▇▇▇▇▇▇▇▇ becoming familiar with the
business affairs of the Company and any present or future parent, subsidiary
and/or affiliate.
15.2 Covenant Not to Compete. In consideration for the Compensation, and as
a condition to the performance by the Company of all obligations under this
Agreement, ▇▇▇▇▇▇▇▇▇ agrees that during the Term of this Agreement and for the
period from the date of termination of ▇▇▇▇▇▇▇▇▇'▇ employment through the second
(2nd) anniversary of such date, ▇▇▇▇▇▇▇▇▇ shall not directly or indirectly
through any other person, firm or corporation compete with or be engaged in the
same business or "participate in" any other business or organization which
during such period competes with or is engaged in the same business as the
Company. The term "participate in" shall mean: "directly or indirectly, for his
own benefit or for, with, or through any other person, firm, or corporation,
own, manage, operate, control, loan money to, or participate in the ownership,
management, operation, or control of, or be connected as a director, officer,
employee, partner, consultant, agent, independent contractor, or otherwise with,
or acquiesce in the use of his name." In addition, ▇▇▇▇▇▇▇▇▇ shall not, for
his account or any other account, solicit or cause an employee of the Company
to leave his or her employment relationship with the Company. Notwithstanding
the foregoing, it shall not be a breach of the provisions of this Section 15
if, after the term of this Agreement, ▇▇▇▇▇▇▇▇▇ is a passive investor in any
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publicly held entity and ▇▇▇▇▇▇▇▇▇ owns three (3%) percent or less of the equity
interests therein.
15.3 Restrictive Covenants Necessary and Reasonable. ▇▇▇▇▇▇▇▇▇ agrees that
the provisions of this Section 15 are necessary and reasonable to protect the
Company in the conduct of its business. If any restriction contained in this
Section 15 shall be deemed to be invalid, illegal, or unenforceable by reason of
the extent, duration or geographical scope thereof, or otherwise, then the court
making such determination shall have the right to reduce such extent, duration,
geographical scope, or other provisions hereof and in its reduced form such
restriction shall then be enforceable in the manner contemplated hereby.
16 Injunctive Relief. ▇▇▇▇▇▇▇▇▇, recognizing that irreparable injury shall
result to the Company in the event of ▇▇▇▇▇▇▇▇▇'▇ breach of the terms and
conditions of this Agreement, agrees that in the event of his breach or
threatened breach, the Company shall be entitled to injunctive relief
restraining ▇▇▇▇▇▇▇▇▇, and any and all persons or entities acting for or with
him, from such breach or threatened breach. Nothing herein contained, however,
shall be construed as prohibiting the Company from pursuing any other remedies
available to it by reason of such breach or threatened breach.
17 Miscellaneous.
17.1 Notices. Any notices required or permitted to be given under this
Agreement shall be sufficient if in writing and sent by registered mail to the
Party to be notified, at the address of the Company at its principal office, as
first set forth above, or to ▇▇▇▇▇▇▇▇▇ at the address as first set forth above.
17.2 Amendment. This Agreement may not be modified, changed, amended, or
altered except in writing signed by ▇▇▇▇▇▇▇▇▇ or his duly authorized
representative, and by a duly authorized officer of the Company.
17.3 Governing Law. This Agreement shall be interpreted in accordance with
the laws of the State of New York. It shall inure to the benefit of and be
binding upon the Company, and its successors and assigns.
17.4 Attorney's Fees. Should any litigation or arbitration be commenced
between the Parties to this Agreement concerning any provision of this
Agreement, the expense of all attorneys' fees and other costs incurred in
connection therewith shall be paid by the losing Party.
17.5 Severability. Should any provision or portion of this Agreement be
held unenforceable or invalid for any reason, the remaining provisions and
portions of this Agreement shall be unaffected by such holding.
17.6 Entire Agreement. This Agreement constitutes the sole and only
agreement of the Parties hereto respecting the subject matter hereof. Any prior
agreements, promises, negotiations, or representations concerning its subject
matter not expressly set forth in this Agreement, are of no force and effect.
17.7 Counterparts. This Agreement and any certificates made pursuant hereto
may be executed in any number of counterparts and when so executed, all of such
counterparts shall constitute a single instrument binding upon all Parties
hereto notwithstanding the fact that all Parties are not signatory to the
original or to the same counterpart.
17.8 Section Headings. The Article and Section headings used in this
Agreement are for reference purposes only, and should not be used in construing
this Agreement.
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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day
and year set forth below.
eB2B Commerce, Inc.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------- --------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Chief Executive Officer
Date: 12/15/99 Date: 12/15/99
--------------------------- --------------------------
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EXHIBIT A
Performance Based Goals
Quarter Quarter Quarter Quarter
Ending Ending Ending Ending
3/31/00 6/30/00 9/30/00 12/31/00
------- ------- ------- --------
Retailers signed on 4,000 5,000 6,000 7,000
Manufacturers signed on 25 40 65 90
Transactions Processed 1,000/wk 10,000/wk 25,000/wk 40,000/wk
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