Exhibit 99.2
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT ("this AAgreement") entered into as of
the 2 nd day of June, 1999, by and between Micros-to-Mainframes,
Inc., a New York corporation ("MTM"), Pivot Technologies, Inc., a
Delaware corporation with its principal place of business at ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the "Company" or
"Pivot") and collectively with MTM, the "Employer"), and ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, residing at ▇▇ ▇▇▇▇▇▇'▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇ (the "Employee").
W I T N E S S E T H :
WHEREAS, the Employee is currently engaged as the President
of the Company;
WHEREAS, the Company has entered into an agreement ("Merger
Agreement") as of even date herewith with MTM, pursuant to which,
among other things, the Company shall merge into a second-tier
wholly-owned subsidiary of MTM (the "Merger"). Unless otherwise
indicated, the "Company" as used herein shall include the
surviving corporation of the Merger ("Merger Sub");
WHEREAS, the Employer is desirous of engaging Employee and
the Employee is desirous of being engaged by the Employer upon
the terms and conditions contained herein;
WHEREAS, the Company owns and develops remote network
technology, provides services in connection therewith and is
engaged in the development of new products and new procedures to
enhance its business (collectively, the "Business"), and MTM
sells computer hardware and software, designs and installs
computer systems, provides computer consulting services and is
engaged in the development of new products and new procedures to
enhance its business;
WHEREAS, MTM desires upon the consummation of the Merger
that Employee shall serve as its Chief Technology Officer ("CTO")
and in connection therewith have primary responsibility for the
network and systems professional services component of MTM's and
its subsidiaries business ("CTO Businesses") set forth in
Schedule A hereto, as amended from time to time to reflect new
acquisitions and/or the Employer entering into a new related
business ("CTO Responsibilities");
WHEREAS, the compensation to be paid to the Employee by the
Employer is at least in part dependent upon profits which may
accrue to the Employer through its ownership and/or operation of
processes and procedures involving trade secrets and proprietary
information relating to its business;
WHEREAS, the Company and MTM are each engaged in a highly
competitive business; and
WHEREAS, the Employer must maintain its competitive position
by protecting its inventions, trade secrets, patents, know-how,
and proprietary information.
NOW, THEREFORE, in consideration of the mutual premises and
agreements contained herein and for other good and valuable
consideration by each of the parties, the parties hereby agree as
follows:
1. Employment
The Employer hereby employs the Employee and the
Employee hereby accepts employment upon the terms and conditions
set forth herein. The Employer shall determine on whose books
and records Employee is recorded as an employee. However, the
liabilities of MTM and the Company hereunder are joint and
several.
2. Term
The term of this Agreement (the "Term") shall commence
as of the effective time of the Merger (the "Commencement Date")
and conclude at 5:00 p.m. on March 31, 2002, unless earlier
terminated as provided herein ("Termination Date"); provided,
however, that the term of this Agreement shall be automatically
continued and extended for additional consecutive twelve month
periods (each, an "Extension Period") commencing upon such
termination date, unless, at least thirty (30) days before the
date of termination of the initial term of this Agreement or of
any such Extension Period, MTM shall give the Employee, or the
Employee shall give MTM, a notice in writing electing to
terminate this Agreement as of such termination date.
3. Services To Be Rendered
During the term of this Agreement, the Employee shall
serve as CTO of MTM and President of the Company and shall
perform such duties as are determined from time to time by the
Employer's respective Board of Directors, provided, however, that
such duties shall be generally consistent with such duties as are
customarily performed by a senior executive officer of a
corporation. Such job description shall not be deemed to be the
sole responsibilities of Employee, which responsibilities shall
be determined from time to time by the respective Employer's
Board of Directors. Upon the consummation of the Merger, Employee
acknowledges that he will assume the CTO Responsibilities for MTM
and its subsidiaries as set forth in Schedule A. If requested by
MTM's Board of Directors, Employee shall serve, in addition to
its responsibilities hereof as CTO of MTM, as a senior executive
officer of one or more other subsidiaries of the Company or MTM
and shall, in the performance of such duties, comply with the
policies of the Board of Directors of such subsidiary. Upon such
appointment, such functions shall be included in Schedule A. If
Employee shall be elected or appointed a director of the Company
or any other subsidiary of MTM or a subsidiary of the Company
during the term of this Agreement, he will serve in such capacity
without further compensation, provided, however, that Employee
shall be entitled to be reimbursed to the same extent as other
directors thereof for expenses incurred in the performance of his
duties as a director thereof. Employee shall also, without
additional compensation other than reimbursement of reasonable
expenses, serve on an advisory management committee reporting to
MTM's Board of Directors ("Management Committee"). The
Management Committee shall be comprised of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇ and Employee for such period of time such individuals are
employed by MTM as senior executive officers. The Management
Committee shall not have the right to establish policy or make
strategic decisions, all of which are reserved to MTM's Board of
Directors. Unless prevented by death or disability, the Employee
shall devote his full business time, allowing for vacations and
holidays, as set forth in Sections 5(e) and (f) hereof, and
illnesses, exclusively to the business and affairs of the
Employer and its respective subsidiaries, and shall use his best
efforts, skill and abilities to promote its interests. Nothing
herein contained shall be construed as preventing the Employee
from purchasing securities in any publicly held entity which
competes with the Company or MTM, if such purchases shall not
result in his owning beneficially 2% or more of the equity
securities of such company.
Without limiting the foregoing, at all times during the
Term:
(a) Employee shall serve as CTO of MTM and provide the
services necessary to carry out the CTO Responsibilities and
serve as the President of the Company and in connection with
acting as President, shall be responsible for the day to day
operations of the Company and report solely to the Company's
Board of Directors or MTM's Chief Executive Officer, provided
however that the Company shall not have an officer senior to
Employee other than the individual then currently serving as CEO
of MTM, to whom non-financial employees of the Company report;
(b) Employer shall not appoint anyone other than Employee
to perform CTO responsibilities without the consent of Employee.
Employer and Employee agree that in the event MTM acquires
another entity, that the parties hereto shall in good faith
determine based on the CTO Responsibilities then being performed,
which aspects of any such acquisition shall be encompassed in CTO
Responsibilities;
(c) In the event MTM's Chief Executive Officer and
Employee disagree as to a matter before the Management Committee
or day to day operations of the Company, Employee shall have
access to MTM's Board of Directors to set forth his position;
(d) The Company shall have its own budget, developed by
Employee and approved by the Board of Directors of MTM and the
Company, with the right of such Board, or its designee, to modify
or amend same after consultation with Employee from time to time;
(e) The Management Committee (or the Chief Executive
Officer and Employee, if the Board of Directors shall determine)
shall review the budget for those areas included in the CTO
Responsibilities, which budget may be accepted, modified or
amended by the Board of Directors of MTM or its designee from
time to time;
(f) Employee shall primarily perform his duties in the
Company's or MTM's Valley Cottage office for as long as network
management service operations are conducted out of at least one
of such facilities and to the extent not otherwise operated at
such location, at MTM's or the Company's location where such
services are primarily performed, provided such office is within
25 miles of the Valley Cottage, New York office and in the event
none of the above are applicable and MTM's executive offices are
located at MTM's current midtown Manhattan offices, out of MTM's
midtown Manhattan office. Notwithstanding the above, Employee
acknowledges and agrees that to the extent his services are
required at a job site or an office of MTM or a subsidiary or
division thereof other than Employee's primary base location at a
time when Employee does not have other commitments with respect
to his CTO Responsibilities, Employee shall spend as much time as
is reasonably required at such locations to perform the necessary
services required, provided such services are consistent with his
responsibilities as a CTO.
(g) Employee shall be a member of the Management
Committee.
Each of the foregoing (a)- (g) shall be hereinafter
referred to as a "Key Employment Term."
4. Compensation
For the services rendered hereunder, the Company
shall pay and the Employee shall accept the following
compensation:
(a)(i) From the Commencement Date through March 31,
2000, the Employee shall receive a base annual salary based on an
April 1 through March 31 Fiscal Year of $150,000; (ii)from April
1, 2000 through March 31, 2001, the Employee shall receive a base
annual salary equal to $175,000; (iii) from April 1,2001 through
the end of the Term, including any Extension Period, a base
annual salary of $185,000.
(b) The Employee shall be entitled to an annual
non-cumulative bonus during the term hereof based upon the
performance of the divisions and subsidiaries of MTM for which
Employee has CTO Responsibilities and is performing such
responsibilities ("CTO Businesses").
(i) The performance goal for the period ending March
31, 2000 is $2,200,000 of Profits (determined on an
annualized basis). Bonuses will be paid as provided
herein if actual performance are at least equal to
such goal, as may be adjusted below, for the period
commencing on the Commencement Date and ending March
31, 2000, determined on an annualized basis. If the
CTO Businesses' Profits are at least equal to the
goal and below $2,500,000, the bonus will be $35,000
in cash and five year options (which options shall
be subject to earlier termination upon Employee's
termination of employment as provided in the MTM
stock option plan), to acquire 20,000 shares of MTM
Common Stock at an exercise price equal to the Fair
Market Value, as defined below, of the MTM Common
Stock at the date following the date MTM's Profits
for such fiscal year are released; in the event the
CTO Businesses' Profits are equal to or greater than
$2,500,000 and less than $2,750,000, Employee shall
be entitled to a bonus of $55,000 in cash and five
year options having terms identical to the above to
acquire 40,000 shares of MTM Common Stock at an
exercise price equal to the Fair Market Value of the
MTM Common Stock at the date following the date
MTM's Profits for such fiscal year are released; and
in the event the CTO Businesses' Profits are equal
to or greater than $2,750,000, Employee shall be
entitled to a bonus of $70,000 in cash and five year
options having terms identical to the above to
acquire 55,000 shares of MTM Common Stock at an
exercise price equal to the Fair Market Value of the
MTM Common Stock date following the date MTM's
Profits for such fiscal year are released. The
aforementioned options, to the extent granted, shall
vest 33-1/3% at the date of grant and fifty percent
(50%) of the remainder on each of the second and
third anniversary thereof, subject to immediate
vesting in the event the Employee terminates this
Agreement for Good Reason, as defined below or the
Company dismisses Employee for other than Cause.
(ii) The performance goal for the period commencing
April 1, 2000 and ending March 31, 2001 ("Second
Year Performance Goal") is the greater of $2,500,000
of Profits, as adjusted below, and the actual
amount of the CTO Businesses' Profits determined for
purposes of (i) above, as adjusted below. Bonuses
will be paid as provided herein if actual
performance are at least equal to such goal, as may
be adjusted below. for the period commencing on
April 1, 2000 and ending March 31, 2001. If the CTO
Businesses' Profits are at least equal to the Second
Year Performance Goal and below the greater of
$2,750,000 and the sum of $250,000 and the Second
Year Performance Goal, the bonus will be $40,000 in
cash and five year options (which options shall be
subject to earlier termination upon Employee's
termination of employment as provided in the MTM
stock option plan), to acquire 30,000 shares of MTM
Common Stock at an exercise price equal to the Fair
Market Value, as defined below, of the MTM Common
Stock at the date following the date MTM's Profits
for such fiscal year are released; in the event the
CTO Businesses' Profits are equal to the greater of
$2,750,000,000 and the sum of $250,000 and the
Second Year Performance Goal but below the greater
of $3,000,000 and the sum of $500,000 and the Second
Year Performance Bonus, Employee shall be entitled
to a bonus of $60,000 in cash and five year options
having terms identical to the above to acquire
45,000 shares of MTM Common Stock at an exercise
price equal to the Fair Market Value of the MTM
Common Stock at the date following the date MTM's
Profits for such fiscal year are released; in the
event the CTO Businesses' Profits are equal to the
greater of $3,000,000 and the sum of $500,000 and
the Second Year Performance Goal and below the
greater of $3,250,000 and the sum of $750,000 and
the Second Year Performance Goal, Employee shall be
entitled to a bonus of $65,000 in cash and five year
options having terms identical to the above to
acquire 50,000 shares of MTM Common Stock at an
exercise price equal to the Fair Market Value of the
MTM Common Stock at the date following the date
MTM's Profits for such fiscal year are released; and
in the event the CTO Businesses' Profits are equal
to or greater than the greater of $3,250,000 and the
sum of $750,000 and the Second Year Performance
Goal, Employee shall be entitled to a bonus of
$70,000 in cash and five year options having terms
identical to the above to acquire 60,000 shares of
MTM Common Stock at an exercise price equal to the
Fair Market Value of the MTM Common Stock date
following the date MTM's Profits for such fiscal
year are released. The aforementioned options, to
the extent granted, shall vest 33-1/3% at the date
of grant and fifty percent (50%) of the remainder on
each of the second and third anniversary thereof,
subject to immediate vesting in the event the
Employee terminates this Agreement for Good Reason,
as defined below or the Company dismisses Employee
for other than Cause.
(iii) The performance goal for the period commencing
April 1, 2001 and ending March 31, 2002 ("Third Year
Performance Goal") is the greater of $3,000,000 of
Profits, as adjusted below, and the actual amount
of the CTO Businesses' Profits determined for
purposes of (ii) above. Bonuses will be paid as
provided herein if actual performance are at least
equal to such goal, as may be adjusted below. for
the period commencing on April 1, 2001 and ending
March 31, 2002. If the CTO Businesses' Profits are
at least equal to the Third Year Performance Goal
and below the greater of $3,500,000 and the sum of
$500,000 and the Third Year Performance Goal, the
bonus will be $65,000 in cash and five year options
(which options shall be subject to earlier
termination upon Employee's termination of
employment as provided in the MTM stock option
plan), to acquire 50,000 shares of MTM Common Stock
at an exercise price equal to the Fair Market Value,
as defined below, of the MTM Common Stock at the
date following the date MTM's Profits for such
fiscal year are released; in the event the CTO
Businesses' Profits are equal to the greater of
$3,500,000, and the sum of $500,000 and the Third
Year Performance Goal but below the greater of
$3,750,000 and the sum of $750,000 and the Third
Year Performance Bonus, Employee shall be entitled
to a bonus of $70,000 in cash and five year options
having terms identical to the above to acquire
60,000 shares of MTM Common Stock at an exercise
price equal to the Fair Market Value of the MTM
Common Stock at the date following the date MTM's
Profits for such fiscal year are released; in the
event the CTO Businesses' Profits are equal to the
greater of $3,750,000 and the sum of $750,000 and
the Third Year Performance Goal and below the
greater of the greater of $4,000,000 and the sum of
$1,000,000 and the Third Year Performance Goal,
Employee shall be entitled to a bonus of $75,000 in
cash and five year options having terms identical to
the above to acquire 65,000 shares of MTM Common
Stock at an exercise price equal to the Fair Market
Value of the MTM Common Stock at the date following
the date MTM's Profits for such fiscal year are
released; and in the event the CTO Businesses'
Profits are equal to or greater than $4,000,000 and
the sum of $1,000,000 and the Third Year Performance
Goal, Employee shall be entitled to a bonus of
$85,000 in cash and five year options having terms
identical to the above to acquire 70,000 shares of
MTM Common Stock at an exercise price equal to the
Fair Market Value of the MTM Common Stock date
following the date MTM's Profits for such fiscal
year are released. The aforementioned options, to
the extent granted, shall vest 33-1/3% at the date
of grant and fifty percent (50%) of the remainder on
each of the second and third anniversary thereof,
subject to immediate vesting in the event the
Employee terminates this Agreement for Good Reason,
as defined below or the Company dismisses Employee
for other than Cause.
(iv) The performance goal for any Extension Period
shall be the same as set forth in (iii) above except
that the term Third Year Performance Goal shall
refer to the greater of the actual amount of CTO
Businesses/ Profits, as adjusted below for the
previous Fiscal Year and $3,000,000.
Profits shall mean the CTO Businesses' pre-tax earnings
without giving effect to any tax loss carryforward, and
determined in accordance with generally accepted accounting
principles. Profits shall be determined in good faith by MTM's
chief financial officer, within 90 days after the end of the
applicable fiscal year. Notwithstanding anything contained
herein to the contrary, the parties hereto acknowledge that (X)
corporate overhead (including, but not limited to, (i)
compensation payable to MTM's corporate officers and support
staff providing services directly or indirectly to the CTO
Businesses, but excluding warehouse facilities and related
expenses to the extent such facilities do not house Merger Sub
inventory, (ii) legal and accounting fees not attributable to any
specific division or subsidiary of MTM, and (iii) corporate
office expenses shall be allocated among MTM, its divisions and
subsidiaries based on the gross revenues attributable to each,
and shall be an item of deduction in computing Profits and (Y)
earnings shall be computed without giving effect to extraordinary
items of income and expense determined in accordance with
generally accepted accounting principles. In the event a new CTO
Business is added during any Term year, the performance goal and
the trigger points for increased bonuses shall be adjusted in
good faith by the Chief Executive Officer of MTM and Employee,
subject to the right of MTM's Board of Directors to establish in
good faith such new performance goals and trigger points, to
reflect the amount of income earned by such new entity (on an
annualized basis) for the year ending on the day prior to
acquisition or the previous year, if greater. It is the
intention of the parties hereto that Employee be rewarded for any
appreciation over such entities base business. Within sixty (60)
days after such acquisition, MTM's chief financial officer shall
give Employee written notice of the revised bonus goals.
Fair Market Value shall be shall be determined by MTM's
Board of Directors in good faith, provided, however, if the
shares of MTM Common Stock are listed on a national securities
exchange or traded on the over-the-counter market, the fair
market value shall be the closing price as reported by such
exchange or market or, if no such closing price is reported, the
average of the closing bid and asked prices of the shares of
Common Stock on the over-the-counter market, as reported by the
Nasdaq Stock Market, the National Association of Securities
Dealers OTC Bulletin Board or the National Quotation Bureau,
Inc., as the case may be, on the last day of the applicable
measuring period, or, if there is no closing price or bid or
asked price on that day, the closing price or average of the
closing bid and asked prices on the most recent day preceding the
day on which the Option is granted for which such prices are
available.
(c) The Employee's salary shall be payable subject
to such deductions as are then required by law and such further
deductions as may be agreed to by the Employee, in accordance
with the Company's prevailing salary payroll practices.
5. Benefits and Expenses
(a) The Employee shall be entitled to participate,
subject to customary eligibility requirements, in all fringe
benefits customarily granted or made available to an executive
officer of MTM. The Employee shall be entitled to participate,
subject to customary eligibility requirements, in all fringe
benefits customarily granted or made available to a senior
executive officer of the surviving corporation or MTM, other than
to the extent made available to ▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
and not to other executives of the surviving corporation or MTM,
such as medical, disability, hospital and health insurance plans,
and profit sharing and pension plans, life insurance and other
plans, if any.
(b) In the event that the Employee's employment by
the Company is terminated for any reason, the Employee shall have
the right to purchase from the Company any insurance policies on
his life owned by the Company for a price equal to the cash
surrender value of the policies at the date of such termination,
plus prepaid premiums, if any. The right to purchase such life
insurance policies shall be exercised by the Employee by written
notice to the Company not less than thirty (30) days after the
date of such termination of employment, and the purchase price
for such policies shall be paid by the Employee to the Company
simultaneously with such written notice. The Company and any
successor thereto agree to maintain, provided Employee is
insurable, $50,000 of term life insurance on the life of
Employee.
(c) During the term of this Agreement, the Company
shall, upon presentation of proper vouchers, also reimburse the
Employee for all reasonable expenses incurred by him directly in
connection with his performance of services as an officer and
employee of the Company.
(d) The Employer shall pay Employee an additional
$500 per month for the remainder of the Term hereof on the first
day of each month thereof, as a non-accountable car allowance.
The Employer shall not be responsible for insurance for said car
nor any other expenses associated with such car. Any income
taxes resulting from the payment of such allowance shall be the
responsibility of the Employee.
(e) The Employee shall be entitled to four (4) weeks
of vacation per annum each full Term year (proportionately
reduced for any year of the Term ending prior to twelve (12)
months after the end of the previous term year, provided that the
Employee shall not take more than two consecutive weeks of
vacation during any calendar year. To the extent the Company or
its successor has a sick/personal day policy, the vacation set
forth above shall be independent thereof.
(f) The Employee shall receive as paid days off all
holidays that the Company, pursuant to established policy,
recognizes and observes.
6. Disability; Death; Termination for Cause
(a) If, during the term of this Agreement, the Employee
becomes so disabled or incapacitated by reason of any physical or
mental illness so as to be unable to perform the services
required of him pursuant to this Agreement for a continuous
period of ninety (90) days, then this Agreement shall terminate
at the end of such ninety (90) day period, provided that during
such period, the Employee shall be paid the full salary,
benefits, and expenses otherwise payable to him as set forth
above, less the amount paid to the Employee from mandatory
disability insurance for the period of such illness or
incapacity. This agreement shall also terminate upon and as of
the date of death of the Employee at any time during the term of
this Agreement. Upon termination of this Agreement due to death
or disability, Employee (or his estate) shall be entitled to
payment of a bonus pursuant to Section 4(b) computed through the
date of death or disability. The performance goal shall be
proportionally reduced in such case. Other than the payment of
such bonus, no further payments of compensation shall be required
hereunder.
(b) The employment of Employee may be terminated by the
Company for Cause. Such termination for Cause shall be effective
immediately upon delivery of written notice to the Employee
setting forth the reason or reasons for such termination. Upon
the termination of this Agreement in accordance herewith, the
Employer shall not be obligated to make any further payments of
compensation hereunder (including accrued bonuses)to the
Employee. Termination for Cause or, except as provided below, by
reason of disability shall not relieve Employee of its covenants
to the Employer set forth herein, which covenants shall survive
such termination. In the event this Agreement is terminated as a
result of Employee's disability, the covenant set forth in
Section 7(a) hereof shall be of no force and effect upon Employee
giving the Company four (4) week written notice that he is no
longer disabled and the Company (or a successor or assign) not
offering to rehire Employee upon substantially the same terms and
conditions set forth herein.
For purposes hereof, "Cause" shall mean (i) acts and/or
omissions, or a course of conduct, of Employee, that constitute
gross negligence or willful neglect, (ii) drug or alcohol abuse,
(iii) conviction of a felony, other than traffic offenses which
do not bring the Employee or Company into disgrace or disrepute,
or (iv) any act of embezzlement, conversion of goods or services,
or fraud with respect to the Company.
In the event the Company dismisses Employee for other
than Cause or Employee terminates this Agreement for Good Reason,
Employee shall be entitled to receive (i) his base compensation
for twelve months, without offset or deduction, and (ii) bonus
owing through the date of termination for the year in which
termination occurs calculated in accordance with Section 4(h)
(with proportionately reduced performance goals and bonus
amounts). Termination by the Employee with Good Reason shall not
relieve Employee of his covenants to the Company set forth
herein, which covenants shall survive such termination.
For purposes hereof, "Good Reason" shall mean: (i) a
material reduction in Employee's duties or authority at a time
when Employee is not in material default hereof; (ii) the breach
of a Key Employment Term at a time when Employee is not in
material breach hereof; or (iii) a material breach by the
Employer of this Agreement which is not cured within twenty (20)
days of giving written notice thereof, provided Employee is not
then in material breach hereof ("Employer Breach"). Termination
as a result of an Employer Breach shall not relieve Employee of
his covenants to the Employer set forth herein, which covenants
shall survive such termination.
7. Covenants and Restrictions. The Employee covenants
that, except in carrying out his duties hereunder, during the
term of his employment and for a period of eighteen (18) months
following the date of termination of employment hereunder (or
such longer or lesser period specifically provided herein upon
the happening of certain specified events. Where the time is so
extended or shortened in (a) below with respect to any activity,
except as specifically provided in subsections (a) through (e) of
this Section 7, the non-competition period for each such
subsection shall be increased or decreased with respect to such
activity to the shorter or longer period referred to in (a)):
(a) Employee will not, directly or indirectly, own
any interest in, participate or engage in, assist, render any
services (including advisory services) to, become associated
with, work for, serve (in any capacity whatsoever, including,
without limitation, as an employee, consultant, advisor, agent,
independent contractor, officer or director) or otherwise become
in any way or manner connected with the ownership, management,
operation, or control of, any business, firm, corporation,
partnership or other entity (collectively referred to herein as a
"Person") that engages in, or assists others in engaging in or
conducting any business, which deals, directly or indirectly, in
products or services competitive with the Employer's product line
or services (provided, however, (i) such non competition will be
limited to twelve (12) months with respect to the above to the
extent it does not substantially constitute a total solution
network and systems management services and (ii) such non
competition will be increased to twenty four (24) months in the
event the Employee terminates this Agreement for Good Reason or
Employer dismisses Employee for other than Cause with respect to
any activity to the extent it substantially competes with or
constitutes the development or operation of a total solution
network management service.) Nothing set forth above shall be
deemed to prohibit Employee from owning or acquiring securities
issued by any corporation whose securities are listed with a
national securities exchange or are traded in the
over-the-counter market, provided that Employee at no time owns,
directly or indirectly, beneficially or otherwise, two (2%)
percent or more of any class of any such corporation's
outstanding capital stock). For purposes of this Section 7, an
Employee shall not be deemed to be competing with the Employer if
the Employee performs network management services as an employee
of a corporation, provided such corporation does not directly or
indirectly compete with the Employer, or has become a client of
the Employer after the date hereof and prior to Employee's
termination of employment ("Permitted Alternative Employment").
In the event the Term is not extended by reason of the Company
not agreeing to continue employment of the Employee upon the
terms set forth above, the 18 month non-compete period for
purposes of this subsection (a) shall be reduced to twelve (12)
months. This subparagraph (a) in no way limits Employee's
prohibition from soliciting any of the Company's or its
subsidiaries' customers for the full 18 month period of the non
compete.
(b) Except as specifically provided in this
subsection (b), notwithstanding anything contained in subsection
(a) above, Employee will not knowingly provide or solicit to
provide to any Person or individual, except for any Permitted
Alternative Employment, (i) any goods or services which are
competitive with those provided by the Employer or which would be
competitive with the goods or services that the Employer has
planned to provide, or (ii) any goods or services to any customer
of the Employer. The term "customer" shall mean any Person or
individual to whom the Employer has provided goods or services
within the twelve (12) month period prior to the termination of
Employee's employment hereunder. Notwithstanding anything herein
to the contrary, no limitation shall be imposed on Employee
hereunder with respect to any goods and services that the
Employer has planned to provide and which are not actually being
provided at the time of the termination of Employee's employment
hereunder and which are not actually provided within six (6)
months following the termination of Employee's employment
hereunder. The term "Employer" for purposes of this subsection
(b) shall mean entities with respect to which Employee has CTO
Responsibilities.
(c) Without limiting Section 8 hereof, Employee
agrees that he shall not divulge to others, nor shall he use to
the detriment of the Employer or in any business or process of
manufacture competitive with or similar to any technology,
business or process of manufacture engaged in by the Employer or
any of its subsidiary or affiliated companies, at any time during
his employment with the Employer or thereafter, any confidential
or trade secret information obtained by him during the course of
his employment with the Employer relating to technology, sales,
salesmen, sales volume or strategy, customers, formulas,
processes, methods, machines, manufactures, compositions, ideas,
improvements or inventions belonging to or relating to the
business of the Employer, or its subsidiary or affiliated
companies.
(d) Employee will neither solicit, hire or seek to
solicit or hire any of the Employer's personnel in any capacity
whatsoever nor shall Employee induce or attempt to induce any of
the Employer's personnel to leave the employ of the Employer to
work for Employee or otherwise. Notwithstanding the above, if
Employee's employment is terminated by Employee for Good Reason
or Employer terminates such employment without Cause, Employee
may solicit, hire or seek ▇▇▇▇ ▇▇▇▇▇▇ and/or ▇▇▇▇▇▇ ▇▇▇▇ to
perform services for Employee or a company with which he is
affiliated, provided, however, that such services in no way
violates the aforementioned persons' respective non-compete under
their respective employment agreements with the Company.
(e) Employee acknowledges that his breach of any
of the restrictive covenants contained in this Section 7 may
cause irreparable damage to the Employer for which remedies at
law would be inadequate. Accordingly, if Employee breaches or
threatens to breach any of the provisions of this Section 7, the
Employer, or a member thereof, shall be entitled to appropriate
injunctive relief, including, without limitation, preliminary and
permanent injunctions, in any court of competent jurisdiction,
restraining Employee from taking any action prohibited hereby.
This remedy shall be in addition to all other remedies available
to the Employer at law or equity. If any portion of this Section
7 is adjudicated to be invalid or unenforceable, this Section 7
shall be deemed amended to delete therefrom the portion so
adjudicated, such deletion to apply only with respect to the
operation of this Section 7 in the jurisdiction in which such
adjudication is made.
8. Proprietary Property.
(a) The Employee agrees that any and all
inventions or improvements as well as any and all ideas,
creations, know-how and methods of applying and putting into
practice any inventions or improvements (all of the foregoing
being hereinafter called "Proprietary Property" and being more
fully defined in subparagraph (b) below) that are created,
developed, conceived of or discovered either (i) by the Employee
(solely or jointly with others) either in the course of his
employment, on the Employer's time, with the Employer's materials
or facilities, relating to any subject matter with which his work
for the Employer is or may be concerned, or relating to any
business in which the Employer or any of its subsidiaries or
affiliated companies is involved, or (ii) by or for the Employer,
or (iii) by any independent individual or Person and thereafter
acquired by the Employer, and which are within the Employee's
knowledge or possession in the case of (i) above or that come
into the Employee's knowledge or possession during and in the
course of the Employee's employment hereunder in the case of (ii)
or (iii) above, shall be, if created, developed, conceived of or
discovered by the Employee, promptly disclosed to the Employer,
or shall be, if otherwise developed or acquired by the Employer,
received by the Employee as an employee of the Employer and not
in any way for his own benefit. Employee shall neither have nor
obtain any right, title or interest in or to such Proprietary
Property unless and until the Employer shall expressly and in
writing waive the rights that it has therein and thereto under
the provisions of this sentence. With respect to any and all
Proprietary Property that is invented, created, written,
developed, furnished or produced by the Employee, or suggested by
the Employee to the Employer, during the term of the Employee's
employment under this Agreement, Employee does hereby agree that
all such Proprietary Property shall be the exclusive property of
the Employer, and that the Employee shall neither have nor retain
any right, title or interest, of any kind therein and thereto or
in and to any results or proceeds therefrom. At any time,
whether during or after the term of this Agreement, the Employee
will, upon the request and at the expense of the Employer, (A)
obtain patents or copyrights on, or (B) permit the Employer to
patent or copyright, any such Proprietary Property, whichever (A)
or (B) is appropriate, and/or (C) execute, acknowledge and
deliver any and all assignments, instruments of transfer, or
other documents, that the Employer deems necessary or appropriate
to transfer to and vest in the Employer all right, title and
interest in and to such Proprietary Property and to evidence the
Employer's ownership of such Proprietary Property, including,
without limitation, taking all steps necessary to enable the
Employer to publish or protect said Proprietary Property by
patents or otherwise in any and all countries and to render all
such assistance as the Employer may require in any patent office
proceeding or litigation involving said Proprietary Property.
The Employee shall not, without limitation as to time or place,
use any Proprietary Property except on Employer business, during
or after his period of employment, nor disclose the same to any
other Person or individual except for disclosure on Employer
business or as may be required by law.
(b) As used in this Agreement, "Proprietary
Property" means proprietary technical information not generally
known in the Employer's industry and which is disclosed to
Employee or known or developed by Employee as a consequence of or
through his employment with the Employer.
(c) During or subsequent to the Employee's
employment by Employer, Employee will never, directly or
indirectly, lecture upon, publish articles concerning, use,
disseminate, disclose, sell or offer for sale any Proprietary
Property without the Employer's prior written permission.
9. Prior Agreements
Employee represents that he is not now under any written
agreement, nor has he previously, at any time, entered into any
written agreement with any person, firm or corporation, which
would or could in any manner preclude or prevent him from giving
freely and the Employer receiving the exclusive benefit of his
services.
10. Miscellaneous
(a) This Agreement shall inure to the benefit of
and be binding upon the Employer, its successors and assigns, and
upon the Employee, his heirs, executors, administrators, legatees
and legal representatives. Employee acknowledges that in the
event of the Merger, this Agreement shall be become the
obligation of the surviving corporation and Employee shall
continue to be bound by the terms hereof.
(b) Should any part of this Agreement, for any
reason whatsoever, be declared invalid, illegal, or incapable of
being enforced in whole or in part, such decision shall not
affect the validity of any remaining portion, which remaining
portion shall remain in full force and effect as if this
Agreement had been executed with the invalid portion thereof
eliminated, and it is hereby declared the intention of the
parties hereto that they would have executed the remaining
portion of this Agreement without including therein any portion
which may for any reason be declared invalid.
(c) This Agreement shall be construed and enforced
in accordance with the laws of the State of New York applicable
to agreements made and performed in such State without
application to the principles of conflicts of laws.
(d) This Agreement and all rights hereunder are
personal to the Employee and shall not be assignable, and any
purported assignment in violation thereof shall be null and void.
Any person, firm or corporation succeeding to the business of
the Employer by merger, consolidation, purchase of assets or
otherwise, shall assume by contract or operation of law the
obligations of the Employer hereunder; provided, however, that
the Employer shall, notwithstanding such assumption and/or
assignment, remain liable and responsible for the fulfillment of
the terms and conditions of the Agreement on the part of the
Employer to the extent the Employer is surviving. In the event
MTM spins-off Pivot, or a corporation of which Pivot is a wholly-
owned subsidiary, to MTM's stockholders, this Agreement shall not
be terminated and deemed continued as if the Employer was the
corporation being spun-off and Pivot, to the extent it is not the
spun-off entity.
(e) This Agreement, and the Merger Agreement (to
the extent applicable) constitutes the entire agreement between
the parties hereto with respect to the terms and conditions of
the Employee's employment by the Company, as distinguished from
any other contractual arrangements between the parties pertaining
to or arising out of their relationship, and this Agreement and
the Merger Agreement, to the extent applicable, supersedes and
renders null and void any and all other prior oral or written
agreements, understandings, or commitments pertaining to the
Employee's employment by the Company, including, without
limitations that certain Employment Agreement dated May 18, 1998.
No variation hereof shall be deemed valid unless in writing and
signed by the parties hereto, and no discharge of the terms
hereof shall be deemed valid unless by full performance by the
parties hereto or by a writing signed by the parties hereto. No
waiver by either party of any provision or condition of this
Agreement by him or it to be performed shall be deemed a waiver
of similar or dissimilar provisions and conditions at the same
time or any prior or subsequent time.
(f) Any notice, statement, report, request or
demand required or permitted to be given by this Agreement shall
be in writing, and shall be sufficient if delivered in person or
if addressed and sent by certified mail, return receipt
requested, to the parties at the addresses set forth above, or at
such other place that either party may designate by notice in the
foregoing manner to the other.
(g) The failure of either party to insist upon the
strict performance of any of the terms, conditions and provisions
of this Agreement shall not be construed as a waiver or
relinquishment of future compliance therewith, and said terms,
conditions and provisions shall remain in full force and effect.
No waiver of any term or any condition of this Agreement on the
part of either party shall be effective for any purpose
whatsoever unless such waiver is in writing and signed by such
party.
(h) The heading of the paragraphs herein are
inserted for convenience and shall not affect any interpretation
of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement as of the day and year first written above.
Micros to Mainframes, Inc. PIVOT TECHNOLOGIES, INC.
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/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇