EMPLOYMENT AGREEMENT
This Agreement, dated as of ________________1998, is between SpaceDev Inc. a
Colorado Corporation ("the Company" or "SPDV"), with offices in Washington DC
and San Diego, California; and ▇▇▇ ▇. ▇▇▇▇ ("▇▇▇▇").
WHEREAS
SPDV and King wish to enter into an employment relationship on the following
terms and conditions.
A. SPDV considers the services of King to be provided under this Agreement to be
unique, extraordinary, and/or of intellectual character.
B. SPDV has spent significant time, effort, and money to develop certain
Proprietary Information (as defined below), which SPDV considers vital to its
business and goodwill.
C. The Proprietary Information will necessarily be communicated to or acquired
by King in the course of his employment with SPDV, and SPDV wishes to hire King
only if, in doing so, it can protect its Proprietary Information and goodwill.
D. SPDV anticipates that certain Invention/Ideas (as defined below) will be
conceived, developed, or reduced to practice by King during the course of his
employment by SPDV.
E. SPDV wishes to hire King only if, in doing so, it can provide for the
disclosure, assignment, and protection of these Invention/Ideas as provided in
this Agreement.
ACCORDINGLY, the parties agree as follows:
1. Period of Employment.
(a) Basic Term. SPDV shall employ King to render services to SPDV in the
position and with the duties and responsibilities described in Section 2 for the
period (the "Period of Employment") commencing on the date of this Agreement
and, unless this agreement is extended by mutual written agreement, ending as
set forth in Section 4.
(b) Renewal. Subject to Section 4, King's employment will be renewed
automatically for additional one (1) year periods (without any action by
either party) on the Term Date and on each anniversary thereof, unless one
party gives to the other written notice thirty (30) days in advance of the
beginning of any one-year renewal period that the Period of Employment is
to be terminated. Either party may elect not to renew this Agreement with
or without cause, in which case this Section 1(b) shall govern King's
termination and not Section 4 (except for King's termination obligations
set forth in Section 4(h), which shall remain in effect). Nothing stated
in this Agreement or represented orally or in writing to either party
shall create an obligation to renew this Agreement.
(c)
2. Position and Responsibilities.
(a) Position. King accepts employment with SPDV in the position of
Vice President - Space Engineering. As such, King will be
responsible for the following job functions, in addition to
those as assigned by the president:
1. The Vice President - Space Engineering will report
to the president of SpaceDev. The chief engineer(s) and their
staff will report to the Vice President - Space Engineering.
The Vice President - Space Engineering will be responsible for
hiring the technical staff for SpaceDev who will have the
responsibility to design and develop the space and ground
segments of the NEAP-1 system, and who may simultaneously be
given the title and responsibilities of Spacecraft Engineer
for the NEAP mission. Vice President - Space Engineering will
assist the marketing staff by evaluating customer instruments
and assuring their compatibility with the spacecraft and the
ground system elements. The Vice President - Space Engineering
will be responsible for presentations to new potential
customers, investors and due diligence committee
representatives; be responsible for the procurement of all
necessary government licenses associated with the use of the
radio spectrum, launch vehicles as well as other technical
documents as needed; the preparation of any FCC or NTIA
filing(s) that may be required and preparation of technical
documents necessary in the procurement of the launch vehicles
required for SpaceDev missions; assist in negotiations on
major contracts where technical input is required; protecting
and optimizing the use of the company's intellectual property
rights (IPR) which are developed/generated by the company,
it's consultants and/or contractors. As a necessary part of
these duties, the Vice President - Space Engineering will be
required to remain informed of current and emerging technology
in the small, low cost spacecraft field and be required to
institute suitable means of obtaining access to key
technologies for SpaceDev as they become available to enhance
performance, increase reliability and reduce cost of SpaceDev
space missions. Where applicable and as approved by the
president and the Board of Directors of SpaceDev the Vice
President - Space Engineering would implement IR&D activities
that will assure key technologies are available for SpaceDev
mission in a timely manner.
2. King shall devote reasonable efforts and full-time attention to the
performance of his duties. King shall be subject to the direction of SPDV, which
shall retain full control of the means and methods by which he performs the
above services and of the place(s) at which all services are rendered. King
shall report to the President of SPDV. It is expected that King will be expected
to travel (within reason) if necessary or advisable in order to meet the
obligations of his position.
(a) Other Activity. Except with the prior written consent of SPDV, King
(during the Period of Employment) shall not (1) accept any other
employment; or (2) engage, directly or indirectly, in any other
business venture for pecuniary gain, which relates to SPDV's primary
business. This subsection shall not prohibit the participation by King
in any trade associations or groups formed purely for recreation or the
advancement of the group members career, education, know-how,
association with other group members or groups or other purpose where
group members are not compensated for their participation.
(b) Representations. King represents and warrants (1) that he believes he
is fully qualified and competent to perform the responsibilities for
which he is being hired pursuant to the terms of this Agreement; and
(2) that King's execution of this Agreement, his employment with SPDV,
and the performance of his proposed duties under this Agreement shall
not violate any obligations he may have to any former employer, Public
Law or restriction due to his prior government service, including any
obligations with respect to proprietary or confidential information of
any other person or entity.
3. Compensation and Benefits.
(a) Salary. In consideration of the services to be rendered under this
Agreement, SPDV shall pay King One Hundred Thirty-two Thousand Dollars
($132,000) per year, payable semi-monthly, pursuant to the procedures regularly
established, and as they may be amended, by SPDV in its sole discretion, during
the Period of Employment.
(b) Corporate Stock. As additional consideration King shall be issued Common
Stock in SPDV as follows:
(1) 5,000 shares on execution of this agreement;
(2) 5000 shares per year commencing at the end of the second
anniversary of this agreement and each year thereafter of successfully completed
employment under the terms of this agreement. (e.g. The 5000 shares for the
second year will be issued at the end of the second year (July 2000) and
thereafter at the end of each twelve month term completed
(3) 10,000 shares upon the successful completion of the NEAP space
craft. Completion shall be deemed to have occurred for purposes of this section
when the spacecraft is built, tested and certified as ready for launch within
time, mass and fiscal budgets. For purposes of this section, King and SpaceDev
will agree in writing prior to the commencement of the NEAP space craft project
as to the time, mass and fiscal budgets which will be acceptable to both parties
for King to qualify for the issuance of shares under this subsection;
(4) 15,000 shares for the successful launch into cruise phase by the
Company of the NEAP space craft;
(5) 25,000 shares for the successful completion of the NEAP mission.
(c) All shares issued under subsections 3(b) may have a restriction on transfer
at the sole discretion of SPDV which shall not exceed one year; except that, if
the NASD requires a longer restriction in connection with any offering the
Company makes in connection with a Registered Offering, the shares shall be
restricted as required by the NASD, any underwriter or the Company.
(d) With the exception of shares issued pursuant to Section 3(b)(1), the
issuance of all stock under this Section is conditioned on this agreement being
in full force and effect. In the event this agreement is terminated for any
reason all rights to receive the stock compensation set forth is subsections
3(b)(2) through 3(b)(5) shall terminate.
(e) THE COMMON STOCK TO BE ISSUED AS CONSIDERATION UNDER THIS AGREEMENT ARE
CLASSIFIED AS SECURITIES UNDER THE SECURITIES AND EXCHANGE ACT OF 1933 (ACT) AND
HAVE NOT BEEN QUALIFIED OR REGISTERED WITH THE COMMISSIONER OF CORPORATIONS OF
ANY STATE OR THE SECURITIES AND EXCHANGE COMMISSION (SEC). THE SALE OR TRANSFER
OF THOSE SECURITIES MAY BE UNLAWFUL UNLESS REGISTERED OR EXEMPT FROM
REGISTRATION UNDER REGULATIONS OF THE SECURITIES AND EXCHANGE COMMISSION. THE
COMPANY HAS NO PLANS AT THIS TIME TO REGISTER THE STOCK.
(f) Benefits. King shall be entitled to three weeks of vacation leave in
accordance with SPDV's standard policies. King shall receive, as additional
compensation: (1) a term life insurance policy payable to a beneficiary of his
election, at a value of two times his annual salary as set forth in subparagraph
3 (a) above; and, (2) a policy of disability insurance ("Policy") which pays a
sum on disability, (after the "waiting period" and for any "disability" as both
are defined in the Policy) equal to King's salary compensation as set forth in
subsection 3(a) above. As King becomes eligible therefor, King shall have the
right to participate in and to receive benefits from all present and future
benefit plans specified in SPDV's Employee Handbook and generally made available
to similarly situated employees of SPDV. The stock compensation set forth in
subsections 3(b) shall be in addition to any incentive stock option or other
stock compensation plan offered to all employees under a plan approved or
adopted by the Company. The amount and extent of benefits to which King is
entitled shall be governed by the specific benefit plan, as amended. King also
shall be entitled to any benefits or compensation tied to termination as
described in Section 4. Nothing stated in this Agreement shall prevent SPDV from
changing or eliminating any benefit, except for salary, stock, vacation period,
and insurances as provided in Section 3 of this Agreement, during the Period of
Employment as SPDV, in its sole discretion, may deem necessary or desirable. No
statement concerning benefits or compensation to which King is entitled shall
alter in any way the term of this Agreement, any renewal thereof, or its
termination. All compensation and comparable payments to be paid to King under
this Agreement shall be less withholdings required by law.
(g) Expenses. SPDV shall reimburse King for reasonable travel and other business
expenses incurred by King in the performance of his duties, in accordance with
SPDV's policies, as they may be amended in SPDV's sole discretion. Upon the
execution of this agreement SpaceDev will pay King a one time relocation
allowance of $5500.00.
4. Termination of Employment
(a) By Death. The Period of Employment shall terminate automatically upon the
death of King. SPDV shall pay to and deliver to King's beneficiaries or estate,
as appropriate, any compensation and shares of stock then due and owing,
including payment for accrued unused vacation, if any. Thereafter, all
obligations of SPDV under this Agreement shall cease. Nothing in this Section
shall affect any entitlement of King's heirs to the benefits of any life
insurance plan or other applicable benefits.
(b) By Disability. If King, in the opinion of SPDV's physician or other medical
consultant has been or will be prevented from properly performing his duties
under this Agreement for more than sixty (60) days in any twelve month period as
a result of any physical or mental incapacity then, to the extent permitted by
law, SPDV may terminate the Period of Employment upon two (2) weeks' advance
written notice. SPDV shall pay and deliver to King all compensation and shares
of stock to which he is entitled up through the last business day of the notice
period; thereafter, all obligations of SPDV under this Agreement shall cease.
Nothing in this Section shall affect King's rights under any applicable SPDV
corporate disability plan, if one exists at the time of Kings' termination.
(c) By Employer Not For Cause. At any time, SPDV may terminate King for any
reason, with or without cause, by providing King thirty (30) days' advance
written notice. SPDV shall have the option, in its complete discretion, to
terminate King at any time prior to the end of such notice period, provided SPDV
pays and delivers to King all compensation and shares of stock due and owing
through the last day actually worked, plus an amount equal to the base salary
and shares of stock under Section 3 King would have earned through the balance
of the above notice period; thereafter, all of SPDV's obligations under this
Agreement shall cease. SPDV may dismiss King without cause notwithstanding
anything to the contrary contained in or arising from any statements, policies,
or practices of SPDV relating to the employment, discipline, or termination of
its employees.
(d) By Employer For Cause. At any time, and without prior notice, SPDV may
terminate King for Cause (as defined below). SPDV shall pay and deliver to King
all compensation and shares of stock then due and owing; thereafter, all of
SPDV's obligations under this Agreement shall cease. Termination shall be for
"Cause" if King: (1) acts in bad faith and to the detriment of SPDV; (2) refuses
or fails to act in accordance with any specific appropriate direction or order
of SPDV; (3) exhibits in regard to his employment unfitness or unavailability
for service, misconduct, dishonesty, habitual neglect, or incompetence; (4) is
convicted of a crime. If termination is due to King's disability, Section 4(b)
above shall control, and not this subsection on termination for Cause.
(e) By Employee Not for Cause. At any time, King may terminate his employment
for any reason, with or without cause, by providing SPDV thirty (30) days'
advance written notice. SPDV shall have the option, in its complete discretion,
to make King's termination effective at any time prior to the end of such notice
period, provided SPDV pays and delivers to King all compensation, including
stock earned under Section 3, due and owing through the last day actually
worked, plus an amount equal to the base salary King would have earned through
the balance of the above notice period, not to exceed thirty (30) days;
thereafter, all of SPDV's obligations under this Agreement shall cease.
(f) By Employee for Good Reason. King may terminate, without liability, the
Period of Employment for Good Reason (as defined below), provided King gives
SPDV thirty (30) days' advance written notice of the reason for termination and
his intent to terminate this Agreement. So long as the reason is not SPDV's
failure to pay the salary due under subsection 3 (a) above or failure to issue
the stock pursuant to subsection 3(b) above. SPDV shall have an opportunity
during the 30 day notice period to correct the condition constituting Good
Reason. If the condition is remedied within this period, King's notice to
terminate shall be rescinded automatically; if not remedied, termination shall
become effective upon expiration of the above notice period. King shall have the
right to terminate this agreement with 48 hours notice to SPDV in the event SPDV
fails to pay the consideration due under subsections 3(a) or 3(b) above. In any
event of termination under this subsection SPDV shall pay King all compensation
due and owing through the last day actually worked, plus a lump-sum severance
payment equal to one (1) month base salary, which payments shall be in lieu of
any damages under this Agreement for any alleged breach. The parties agree that
at the time of the making of this agreement the damages which King may suffer as
a result of the Good Reason not being cured by SPDV are speculative, unknown and
difficult or impossible to determine. They agree at this time the one months
severance pay is a reasonable estimate at the time this contract is made to
compensate King as Liquidated Damages for all damages which King would suffer as
a result of a breach of this agreement. After making such payment of one months
severance pay, all of SPDV's obligations under this Agreement, and all payment
obligations of the Company shall cease. SPDV shall also have the option, in its
complete discretion, to make King's termination effective at any time prior to
the end of the notice period, provided that SPDV pays King all compensation due
and owing through the balance of the notice period (not to exceed thirty (30)
days), in addition to the payment of six (6) months' then current base salary.
King shall be entitled to exercise his right to terminate this Agreement for
Good Reason only if he gives the required notice not more than ten (10) days
after the occurrence of the event that is the basis for the Good Reason.
Termination shall be for "Good Reason" if: (1) there is a material and adverse
change in King's position, duties, responsibilities, or status with SPDV; (2)
there is a reduction in King's salary then in effect, other than a reduction
comparable to reductions generally applicable to similarly situated employees of
SPDV; (3) there is a material reduction in King's benefits, other than a
reduction comparable to reductions generally applicable to similarly situated
employees of SPDV; or (4) SPDV materially breaches this Agreement. King shall
not be entitled to terminate this Agreement for Good Reason if an event occurs
that would otherwise constitute Good Reason, except that it results from a
change in SPDV's status as defined in Section 4(g).
(g) Change in Employer Status. To the extent permitted by law, SPDV, in its sole
discretion, may terminate the Period of Employment (in which case all of SPDV's
obligations under this Agreement shall cease after payment of all compensation
due and owing) upon any formal action of SPDV's management to terminate SPDV's
existence or otherwise wind up its affairs, to sell all or substantially all of
its assets, or to merge with or into another entity.
(h) Termination Obligations.
(1) King agrees that all property, including, without limitation, all
equipment, tangible Proprietary Information (as defined below), documents,
books, records, reports, notes, contracts, lists, computer disks (and other
computer-generated files and data), and copies thereof, created on any medium
and furnished to, obtained by, or prepared by King in the course of or incident
to his employment, belongs to SPDV and shall be returned promptly to SPDV upon
termination of the Period of Employment.
(2) All benefits to which King is otherwise entitled shall cease upon
King's termination, unless explicitly continued either under this Agreement or
under any specific written policy or benefit plan of SPDV.
(3) Upon termination of the Period of Employment, King shall be deemed
to also be terminated from all offices and directorships then held with SPDV or
any Affiliate.
(4) The representations and warranties contained in this Agreement,
SPDV's responsibilities under subsection 3(a) and 3(b) to pay salary and issue
stock and, King's obligations under this Section 4(h) on Termination
Obligations, Section 5 on Proprietary Information, and Section 6 on Inventions
and Ideas shall survive the termination of the Period of Employment and the
expiration of this Agreement.
(5) Following any termination of the Period of Employment, King shall
fully cooperate with SPDV in all matters relating to the winding up of pending
work on behalf of SPDV and the orderly transfer of work to other employees of
SPDV. At the Company's expense, King shall also cooperate in the defense of any
action brought by any third party against SPDV that relates in any way to King's
acts or omissions while employed by SPDV.
(i) SPDV agrees to provide King indemnify as provided for in California
Corporations Code section 317 against any action brought by a third party that
relates to King's duties as described above in subsection 2 (a).
5. Proprietary Information.
(a) Defined. "Proprietary Information" is all information and any idea in
whatever form, tangible or intangible, pertaining in any manner to the business
of SPDV, or any Affiliate, or its employees, clients, consultants, or business
associates, which was produced by any employee of SPDV in the course of his or
her employment or otherwise produced or acquired by or on behalf of SPDV.
Without limiting the foregoing definition, Proprietary Information and
Proprietary Information shall include, but not be limited to: (1) formulas,
teaching and development techniques, processes, trade secrets, computer
programs, electronic codes, inventions, improvements, and research projects; (2)
information about costs, profits, markets, sales, and lists of customers or
clients; (3) business, marketing, and strategic plans; and (4) employee
personnel files and compensation information. King should consult any SPDV
procedures instituted to identify and protect certain types of Proprietary
Information, which are considered by SPDV to be safeguards in addition to the
protection provided by this Agreement. Nothing contained in those procedures or
in this Agreement is intended to limit the effect of the other.
Proprietary information does not include:
a) Any information disseminated to the public by the Company or
which becomes part of the public domain through no wrongful
act of King.
b) Any information King knew prior to providing any consulting
services to SPDV, which are protected by a separate
non-disclosure agreement, currently in effect.
c) Any information received by King without any wrong doing from
someone outside the Company who obtained that information in a
lawful manner and who does not have any obligation to keep the
information confidential or proprietary.
(b) General Restrictions on Use. During the Period of Employment, King shall use
Proprietary Information, and shall disclose Proprietary Information, only for
the benefit of SPDV and as is necessary to carry out his responsibilities under
this Agreement. Following termination, King shall neither, directly or
indirectly, use any Proprietary Information nor disclose any Proprietary
Information, except as expressly and specifically authorized in writing by SPDV
for a period of three years after termination. The publication of any
Proprietary Information through literature or speeches must be approved in
advance in writing by SPDV.
(c) Location and Reproduction. King shall maintain at his work station and/or
any other place under his control only such Proprietary Information as he has a
current "need to know." King shall return to the appropriate person or location
or otherwise properly dispose of Proprietary Information once that need to know
no longer exists. King shall not make copies of or otherwise reproduce
Proprietary Information unless there is a legitimate business need for
reproduction.
(d) Prior Actions and Knowledge. King represents and warrants that from the time
of his first contact with SPDV, he has held in strict confidence all Proprietary
Information and has not disclosed any Proprietary Information, directly or
indirectly, to anyone outside of SPDV, or used, copied, published, or summarized
any Proprietary Information, except to the extent otherwise permitted in this
Agreement.
(e) Third-Party Information. King acknowledges that SPDV has received and in the
future will receive from third parties their Proprietary information subject to
a duty on SPDV's part to maintain the confidentiality of such information and to
use it only for certain limited purposes. King agrees that he owes SPDV and such
third parties, during the Period of Employment and thereafter, a duty to hold
all such Proprietary information in the strictest confidence and not to disclose
or use it except as necessary to perform his obligations hereunder and as is
consistent with SPDV's agreement with such third parties.
(f) Competitive Activity. King acknowledges that the pursuit of the activities
forbidden by this subsection would necessarily involve the use or disclosure of
Proprietary Information in breach of the preceding subsections, but that proof
of such a breach would be extremely difficult. To forestall such disclosure,
use, and breach, and in consideration of the employment under this Agreement,
King agrees that for a period of one (1) year after termination of the Period of
Employment, he shall not, directly or indirectly, (1) divert or attempt to
divert from SPDV (or any Affiliate) any business of any kind in which it is
engaged, including, without limitation, the solicitation of or interference with
any of its customers; (2) employ or solicit for employment any person currently
employed by SPDV (or any subsidiary of SPDV); or (3) engage in any business
activity that is or may be competitive with SPDV (or any subsidiary of SPDV) in
any state where SPDV conducts its business, unless King can prove that any
action taken in contravention of this subsection was done without the use in any
way of Proprietary Information.
6. Inventions and Ideas.
(a) Defined; Statutory Notice. The term "Invention/Idea" includes any and all
ideas, processes, trademarks, service marks, inventions, technology, computer
hardware or software, original works of authorship, designs, formulas,
discoveries, patents, copyrights, products, and all improvements, know-how,
rights, and claims related to the foregoing, that are conceived, developed, or
reduced to practice by King (alone or with others), during the Period of
Employment, except to the extent that California Labor Code Section 2870
lawfully prohibits the assignment of rights in such intellectual property.
King acknowledges that he understands that this definition includes only those
rights that may be lawfully assigned pursuant to California Labor Code Section
2870, which provides:
"(a) Any provision in an employment agreement which provides that an
employee shall assign, or offer to assign, any of his or her rights in an
invention to his or her employer shall not apply to an invention that the
employee developed entirely on his or her own time without using the employer's
equipment, supplies, facilities, or trade secret information except for those
inventions that either:
(1) Relate at the time of conception or reduction to practice of the
invention to the employer's business, or actual or demonstrably anticipated
research or development of the employer; or
(2) Result from any work performed by the employee for the employer.
(b) To the extent a provision in an employment agreement purports to require an
employee to assign an invention otherwise excluded from being required to be
assigned under subdivision (a), the provision is against the public policy of
this state and is unenforceable."
Nothing in this Agreement is intended to expand the scope of protection provided
King by Sections 2870 through 2872 of the California Labor Code.
(c) Disclosure. King agrees to maintain adequate and current written records on
the development of all Invention/Ideas and to disclose promptly to SPDV all
Invention/Ideas and relevant records, which records will remain the sole
property of SPDV. King further agrees that all information and records
pertaining to any ideas, processes, trademarks, service marks, inventions,
technology, computer hardware or software, original works of authorship,
designs, formulas, discoveries, patents, copyrights, products, and all
improvements, know-how, rights, and claims related to the foregoing
("Intellectual Property"), that King does not believe to be an Invention/Idea,
but that is conceived, developed, or reduced to practice by King (alone or with
others) during the Period of Employment (or during the post-employment period
set forth in Section 6(e) below), shall be disclosed promptly to SPDV (such
disclosure to be received in confidence). SPDV shall examine such information to
determine if in fact the Intellectual Property is an Invention/Idea subject to
this Agreement.
(d) Assignment. King agrees to assign to SPDV his entire right, title, and
interest (throughout the United States and in all foreign countries), free and
clear of all liens and encumbrances, in and to each Invention/Idea, which shall
be the sole property of SPDV, whether or not patentable. In the event any
Invention/Idea is deemed by SPDV to be patentable or otherwise registrable, King
shall assist SPDV (at its expense) in obtaining letters patent or other
applicable registrations thereon and shall execute all documents and do all
other things necessary or proper thereto (including testifying at SPDV's
expense) and to vest SPDV, or any entity or person specified by SPDV, with full
and perfect title thereto or interest therein. At SPDV's expense, King shall
also take any action necessary or advisable in connection with any
continuations, renewals, or reissues thereof or in any related proceedings or
litigation. Should SPDV be unable to secure King's signature on any document
necessary to apply for, prosecute, obtain, or enforce any patent, copyright, or
other right or protection relating to any Invention/Idea, whether due to King's
mental or physical incapacity or any other cause, King irrevocably designates
and appoints SPDV and each of its duly authorized officers and agents as King's
agent and attorney in fact, to act for and in King's behalf and stead and to
execute and file any such document, and to do all other lawfully permitted acts
to further the prosecution, issuance, and enforcement of patents, copyrights, or
other rights or protections with the same force and effect as if executed,
delivered, and/or done by King.
(e) Exclusions. Except as described in Exhibit A1 attached to this Agreement, to
the best of King's knowledge, there is no existing contract in conflict with
this Agreement and there is no contract to assign any Intellectual Property that
is now in existence between King and any other person or entity.
(f) Post-Termination Period. Because of the difficulty of establishing when any
Intellectual Property is first conceived or developed by King, or whether it
results from access to Proprietary Information or SPDV's equipment, supplies,
facilities, or data, King agrees that any Intellectual Property shall be
presumed to be an Invention/Idea, if reduced to practice by King or with the aid
of King within one (1) year after termination of the Period of Employment. King
can rebut the above presumption if he proves that the Intellectual Property (1)
was developed entirely on King's own time without using SPDV's equipment,
supplies, facilities, or trade secret information; (2) was not conceived or
reduced to practice during the Period of Employment, or, if conceived or reduced
to practice during this period, did not, at the time of conception or reduction
to practice, relate to SPDV's business or actual or demonstrably anticipated
research or development; and (iii) did not result from any work performed by
King for SPDV.
7. Arbitration.
(a) Arbitrable Claims. Disputes between King (and his attorneys, successors, and
assigns) and SPDV (and its Affiliates, shareholders, directors, officers,
employees, agents, successors, attorneys, and assigns) relating in any manner
whatsoever to the employment or termination of King, with the exception of a
breach by King of any responsibility under Section 5, 6 or 15 of this agreement,
but including, without limitation, all disputes regarding the duties of the
parties arising under this Agreement, ("Arbitrable Claims") shall be resolved by
arbitration. All persons and entities specified in the preceding sentence (other
---------------
1 Exhibit A is included as a separate document, forwarded with these
modifications to the Employment Agreement
than SPDV and King) shall be considered third-party beneficiaries of the rights
and obligations created by this Section on Arbitration. Arbitrable Claims shall
include, but are not limited to, contract (express or implied) and tort claims
of all kinds, as well as all claims based on any federal, state, or local law,
statute, or regulation, excepting only claims under applicable workers'
compensation law and unemployment insurance claims. Arbitration shall be final
and binding upon the parties and shall be the exclusive remedy for all
Arbitrable Claims, except that SPDV may, at its option, seek injunctive relief
and damages in court of law or equity for any breach of Sections 5 and 6, or
under the provisions of Section 15 of this Agreement. Subject to the foregoing
sentence, THE PARTIES HEREBY WAIVE ANY RIGHTS THEY MAY HAVE TO TRIAL BY JURY IN
REGARD TO ARBITRABLE CLAIMS.
(b) Procedure. Arbitration of Arbitrable Claims shall be in accordance with the
Employment Dispute Resolution Rules of the American Arbitration Association
("AAA Employment Rules"), except as provided otherwise in this Agreement. Prior
to resorting to arbitration, the complaining party must first exhaust the
procedures specified in any SPDV Employment Manual. Arbitration shall be
initiated by providing written notice to the other party with a statement of the
claim(s) asserted, the facts upon which the claim(s) are based, and the remedy
sought. This notice shall be provided to the other party within six (6) months
of the acts or omissions complained of. Any claim not initiated within this
limitation period shall be null and void. EACH PARTY WAIVES ALL RIGHTS UNDER
STATUTES OF LIMITATIONS OF DIFFERENT DURATION. In any arbitration, the burden of
proof shall be allocated as provided by applicable law. Either party may bring
an action in court to compel arbitration under this Agreement and to enforce an
arbitration award. Otherwise, neither party shall initiate or prosecute any
lawsuit or administrative action in any way related to any Arbitrable Claim. All
arbitration hearings under this Agreement shall be conducted in San Diego,
California. The provisions of California Code of Civil Procedure section 1280
et. seq. shall govern the interpretation and enforcement of this Section 7.
(c) Arbitrator Selection and Authority. All disputes involving Arbitrable Claims
shall be decided by a single arbitrator. The arbitrator shall be selected by
mutual agreement of the parties within thirty (30) days of the effective date of
the notice initiating the arbitration. If the parties cannot agree on an
arbitrator, then the complaining party shall notify the AAA and request
selection of an arbitrator in accordance with the AAA Employment Rules. The
arbitrator shall have the authority to award equitable relief, damages, costs,
and fees as provided by law for the particular claim(s) asserted. The fees of
the arbitrator shall be split between both parties equally. The arbitrator shall
have exclusive authority to resolve all Arbitrable Claims, including, but not
limited to, any claim that all or any part of this Agreement is void or
unenforceable.
(d) Confidentiality. All proceedings and all documents prepared in connection
with any Arbitrable Claim shall be confidential and, unless otherwise required
by law, the subject matter thereof shall not be disclosed to any person other
than the parties to the proceedings, their counsel, witnesses and experts, the
arbitrator, and, if involved, the court and court staff. All documents filed
with the arbitrator or with a court shall be filed under seal. The parties shall
stipulate to all arbitration and court orders necessary to effectuate fully the
provisions of this subsection concerning confidentiality.
(e) Continuing Obligations. The rights and obligations of King and SPDV set
forth in this Section on Arbitration shall survive the termination of King's
employment and the expiration of this Agreement.
8. Notices. Any notice under this Agreement must be in writing and shall be
effective upon delivery by hand, upon facsimile transmission to the number
provided below (if one is provided), or three (3) business days after deposit in
the United States mails, postage prepaid, certified or registered, and addressed
to SPDV or to King at the corresponding address below. King shall be obligated
to notify SPDV in writing of any change in his address. Notice of change of
address shall be effective only when done in accordance with this Section.
SPDV's Notice Address:
SpaceDev Inc.
Attn: President
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King's Notice Address:
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9. Action by SPDV. All actions required or permitted to be taken under this
Agreement by SPDV, including, without limitation, exercise of discretion,
consents, waivers, and amendments to this Agreement, shall be made and
authorized only by the President or by his or her representative specifically
authorized to fulfill these obligations under this Agreement.
10. Integration. This Agreement is intended to be the final, complete, and
exclusive statement of the terms of King's employment by SPDV. This Agreement
may not be contradicted by evidence of any prior or contemporaneous statements
or agreements. To the extent that the practices, policies, or procedures of
SPDV, now or in the future, apply to King and are inconsistent with the terms of
this Agreement, the provisions of this Agreement shall control.
11. Amendments; Waivers. This Agreement may not be modified, amended, or
terminated except by an instrument in writing, signed by each of the parties. No
failure to exercise and no delay in exercising any right, remedy, or power under
this Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, remedy, or power under this Agreement preclude
any other or further exercise thereof, or the exercise of any other right,
remedy, or power provided herein or by law or in equity.
12. Assignment; Successors and Assigns. King agrees that he will not assign,
sell, transfer, delegate, or otherwise dispose of, whether voluntarily or
involuntarily, or by operation of law, any rights or obligations under this
Agreement. Any such purported assignment, transfer, or delegation shall be null
and void. Nothing in this Agreement shall prevent the consolidation of SPDV
with, or its merger into, any other entity, or the sale by SPDV of all or
substantially all of its assets, or the otherwise lawful assignment by SPDV of
any rights or obligations under this Agreement. Subject to the foregoing, this
Agreement shall be binding upon and shall inure to the benefit of the parties
and their respective heirs, legal representatives, successors, and permitted
assigns, and shall not benefit any person or entity other than those
specifically enumerated in this Agreement.
13. Severability. If any provision of this Agreement, or its application to any
person, place, or circumstance, is held by an arbitrator or a court of competent
jurisdiction to be invalid, unenforceable, or void, such provision shall be
enforced to the greatest extent permitted by law, and the remainder of this
Agreement and such provision as applied to other persons, places, and
circumstances shall remain in full force and effect.
14. Attorneys' Fees. In any legal action, arbitration, or other proceeding
brought to enforce or interpret the terms of this Agreement, the prevailing
party shall be entitled to recover reasonable attorneys' fees and costs and the
fees and costs of any arbitration itself.
15. Injunctive Relief. If (1) King refuses to perform the responsibilities
outlined in Section 2 on Position and Responsibilities within the agreed upon
Period of Employment, and King has no right to terminate the employment
relationship pursuant to Section 4 on Termination of Employment, or (2) King
breaches or threatens to breach any of the covenants in Section 5 on Proprietary
Information and Section 6 on Inventions and Ideas, the parties acknowledge that
the damage or imminent damage to SPDV's business or its goodwill would be
irreparable and extremely difficult to estimate, making any remedy at law or in
damages inadequate. Accordingly, SPDV shall be entitled to injunctive relief or
other equitable remedy provided by a court of equity against King in the event
of any breach or threatened breach of such provisions by King, in addition to
any other relief (including damages) available to SPDV under this Agreement or
under law.
16. Governing Law. This Agreement shall be governed by and construed in
accordance with the law of the State of California. Venue for any dispute shall
be in San Diego County California.
17. Interpretation. This Agreement shall be construed as a whole, according to
its fair meaning, and not in favor of or against any party. By way of example
and not in limitation, this Agreement shall not be construed in favor of the
party receiving a benefit nor against the party responsible for any particular
language in this Agreement.
18. Employee Acknowledgment. King acknowledges that he has had the opportunity
to consult legal counsel in regard to this Agreement, that he has read and
understands this Agreement, that he is fully aware of its legal effect
(including notice of his statutory rights under Section 2870 of the California
Labor Code, as set forth in the above Section on Inventions and Ideas), and that
he has entered into it freely and voluntarily and based on his own judgment and
not on any representations or promises other than those contained in this
Agreement.
The parties have duly executed this Agreement as of the date first written
above.
▇▇▇ ▇. ▇▇▇▇ SpaceDev Inc.
By:
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President
EXHIBIT A
PATENTS/INVENTIONS AND OTHER INTELLECTUAL PROPERTY
OF ▇▇▇ ▇. ▇▇▇▇
EXCLUDED FROM EMPLOYMENT AGREEMENT
The following are patents or inventions not patented, but reduced to practice
and works authored by me that I consider excluded from my SpaceDev employment
agreement:
Method and Apparatus for Deploying a Satellite Network, U.S. Patent 5199672,
dated April 6, 1993. NOTE: This patent has been fully assigned to Orbital
Sciences Corp. of Dulles, VA.
Development of the Microsat Spacecraft Concept. A technology developed jointly
by me and the Radio Amateur Satellite Corp. (AMSAT). This technology has
been reduced to practice in 1989 and has been contributed by me to AMSAT,
however, the rights to the technology remain with me and others who
developed the technology. The technology is being held as a trade secret.
AMSAT has sub licensed the technology to industry and to non-profit
organizations.
M/N Series Resonant Orbits. A body of knowledge developed in a series of papers
written by me. The papers describe the properties of a family of orbits
most suitable when used for communications and certain remote sensing
satellites.
Inverse Pseudolite Position Determination. A method of using a GPS Pseudolite in
a reverse roll as a means of tracking lost or stolen objects. The technique
uses the GPS constellation and sites similar to cellular radio base
stations to locate a TAG carrying a pseudolite transmitter. The transmitter
transmits a CDMA code identical to that of the GPS constellation (C/A
only). The technique was invented by myself, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇
▇▇▇▇▇▇▇. The invention is currently being held as a trade secret. A similar
technique seems to have been developed by the United States Air Force and
the University of Vancouver, B.C.. A patent may or may not be filed by the
inventors based on whether we can claim the invention.
Alternative Method of Spectrum Allocation and Assignment Coupled with a Spectrum
Use Measurement System. This is a method of assigning users of the radio
spectrum to channels, based on priority and demand and not based on the
category of service concept (as is currently done). The technique is
intended to capitalize on various changes taking place in
telecommunications today, on a national and global basis. These include the
increasing utilization of Spread Spectrum technology (CDMA) and the
practice of "selling" radio spectrum to certain categories of users. In
order to make such a scheme practical, a land/air/space based monitoring
system would be utilized. This approach to monitoring the use of the radio
spectrum would avoid spectrum "warehousing" and illegal usage of frequency
bands. Both practices are common today. This technique was developed by ▇▇.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Mr. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and myself and is being kept as a trade
secret at this time.