AMENDED AND RESTATED EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this "Agreement") between
SURPLUS SOFTWARE, INC., an Oregon corporation ("Employer"), and ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇("Employee") is dated and entered into as of May 15, 1996.
RECITALS
WHEREAS, Employer and Employee entered into that certain employment
agreement dated as of June 12, 1995 (the "Employment Agreement");
WHEREAS, Employer and Employee wish to amend, restate and supersede the
Employment Agreement; provided, however, that the noncompete agreement
contained in Section 7(b) of the Employment Agreement shall continue herein.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein, Employer and Employee agree as follows:
1. EMPLOYMENT
Employer shall employ Employee and Employee shall accept employment by
Employer in the position of President, effective July 5, 1995. Employee
shall perform such duties as may be assigned to him from time to time by the
Employer's Board of Directors (the "Board") which relate to the business of
Employer, its subsidiaries, its parent corporation, or any business ventures
in which Employer, its subsidiaries or its parent corporation may participate.
2. ATTENTION AND EFFORT
Employee shall devote Employee's full time, attention and effort to
Employer's business and shall skillfully serve its interests.
3. EMPLOYMENT AT WILL
Employee understands and agrees that his employment with Employer is at
will, and that either party may terminate such employment at any time
pursuant to Section 6.
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4. COMPENSATION
4.1 BASE SALARY
Employee's starting annual base salary shall be one hundred thousand
dollars ($100,000), before all customary payroll deductions. At no time
shall Employee's annual base salary be below $100,000. Such annual base
salary shall be paid in substantially equal installments at the same
intervals as other employees of Employer are paid. The Board shall determine
any increases in the annual base salary in future years.
4.2 BONUS
In addition to the base salary provided in Section 4.1, until May 31,
1996, Employee shall be entitled to receive any and all bonus payments
accrued pursuant to the provisions set forth in Section 3 of the Employment
Agreement, thereafter Employee shall be entitled to an annual bonus based
upon attainment of budgeted income before income tax ("Annual Target") as set
forth in the annual budget approved by the Board. Such bonus shall be paid
within ninety (90) days of year-end based on the following schedule:
BONUS
EMPLOYER PERFORMANCE (% OF BASE SALARY)
-------------------- ------------------
Equal to or greater than 70% of
Annual Target 10%
For each additional increment of 6.7% additional for each
10% above 70% of Annual Target such 10% increment
5. BENEFITS
During the term of this Agreement, Employee shall be entitled to
participate, subject to and in accordance with applicable eligibility
requirements, in such fringe benefit programs as may be provided from time to
time by the Employer and shall be reimbursed for reasonable and necessary
travel and other expenses incurred in connection with Employer's business in
accordance with Employer's reimbursement policy.
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6. TERMINATION
6.1 BY EMPLOYER
Employer may terminate the employment of Employee, with or without cause,
(as defined below) at any time during the term of employment upon giving
thirty (30) days' prior notice to Employee. Employer may also terminate this
Agreement for cause at any time without notice.
6.2 BY EMPLOYEE
Employee may terminate Employee's employment at any time upon giving
thirty (30) days' prior notice to Employer.
6.3 AUTOMATIC TERMINATION
Employment shall terminate automatically upon death or total disability of
Employee. The term "total disability" as used herein shall mean an inability
to perform the duties set forth in Section 1 of this Agreement because of
illness or physical or mental disability for a period or periods aggregating
ninety (90) calendar days in any 12-month period, unless Employee is granted
a leave of absence by the Board. The parties hereto acknowledge that
Employee's ability to perform the duties specified in Section 1 hereof is of
the essence of this Agreement. Termination hereunder shall be deemed to be
effective thirty (30) days following Employee's death or immediately upon a
determination by the Board of Employee's total disability, as defined herein.
6.4 NOTICE
In the event that Employee's employment is terminated upon thirty (30)
days' prior notice as provided for in Sections 6.1 or 6.2 of this Agreement,
the parties agree that Employee's employment and performance of services
shall continue for the duration of such notice period; PROVIDED, HOWEVER,
that Employer may, at its own election and without reducing Employee's
compensation during such period, excuse Employee from any or all of
Employee's duties during such period. The effective date of the termination
of Employee's employment hereunder shall be the date on which such thirty-day
period expires, unless Employer and Employee agree in writing to a different
date.
6.5 CAUSE
Wherever reference is made in this Agreement to termination being with or
without cause, "cause" means cause given by Employee to Employer and includes
the
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following: (a) failure or refusal to carry out the directions of the
Board or officers of Employer, which directions are reasonably consistent
with the duties herein set forth to be performed by Employee; (b) violation
of a state or federal criminal law involving the commission of a crime
against Employer or a felony; (c) misuse of alcohol or controlled substances;
(d) misrepresentation, deception, fraud or dishonesty; (e) any incident
compromising Employee's reputation or ability to represent Employer with the
public; (f) any act or omission which substantially impairs Employer's
business, good will or reputation; or (g) any other material breach of this
Agreement. The parties hereto agree that a determination of cause pursuant
to this paragraph shall be committed solely to the discretion of Employer.
6.6 TERMINATION PAYMENTS
In the event of termination of the employment of Employee by Employer
without cause, Employee shall be paid, upon delivery to Employer of a general
release of liability by Employee, in a form acceptable to Employer, an amount
equal to his annual base monthly salary for a period of twelve (12) months
from the date of termination, payable in substantially equal installments at
the same intervals as other employees of the Company are paid. In the event
of termination of the employment of Employee for any other reason, all
salary, bonuses, benefits and other compensation set forth in this Agreement
shall cease as of the effective date of such termination; PROVIDED, HOWEVER,
that if the employment of Employee is automatically terminated due to death
or disability pursuant to Section 6.3 hereof, Employee or Employee's personal
representative shall receive termination payments in the form of Employee's
annual base salary through the conclusion of the calendar month of the
termination of employment because of such death or disability.
7. NONCOMPETITION AND NONSOLICITATION AGREEMENT
7.1 NONCOMPETE
Employee agrees that during the period of his employment and for a period
of two years following termination of employment, Employee shall not directly
or indirectly, invest or engage in any business which is competitive with the
business of Employer, or accept employment with or render services to a
competitor of Employer, as a director, officer, employee, partner, agent or
consultant, or take any action inconsistent with the Employee's fiduciary
relationship as an officer or employee of Employer. The Employee further
agrees that this covenant not to compete applies whether the Employee acts as
an individual for his own account, or as a director, officer, employee,
partner, agent, consultant, representative or shareholder of any person, firm
or corporation. Notwithstanding the foregoing, this Section 7 shall not be
deemed to have been breached by investments of the Employee whereby the
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Employee owns less than 5 percent of the voting stock or other securities or
evidences of ownership of any business (regardless of legal form) whose stock
or securities are traded on one of the national securities exchanges or is
quoted on the NASDAQ system or successors thereto.
7.2 NONSOLICITATION
The Employee agrees that, except as provided in this Section 7, during his
term of employment and for a period of two years following termination of
employment, Employee shall not (a) interfere with Employer's business
relationships, (b) solicit, for products competitive with any of Employer's
products, any customers which are, at the time of such termination, customers
of Employer, or (c) solicit for employment any employees of Employer.
7.3 BEST INTEREST
The Employee agrees to act in the best interest of Employer. The
obligations of the Employee contained in this Section 7 shall survive the
termination of this Agreement.
8. ASSIGNMENT OF INVENTIONS AND CONFIDENTIALITY AGREEMENT
Employee agrees to execute the Assignment of Inventions and
Confidentiality Agreement attached hereto as Exhibit A.
9. CONFLICTING AGREEMENTS
Employee is not a party to any existing or proposed agreements that may
adversely affect Employee's ability to render services to the Employer
hereunder.
10. GENERAL PROVISIONS.
10.1 NO WAIVER
No provision of this Agreement shall be deemed to have been waived unless
such waiver is in writing signed by the waiving party. No failure by any
party to insist upon the strict performance of any provision of this
Agreement, or to exercise any right or remedy consequent upon a breach
thereof, shall constitute a waiver of any such breach, of such provision or
of any other provision. No waiver of any provision of this Agreement shall
be deemed a waiver of any other provision of this Agreement or a waiver of
such provision with respect to any subsequent breach, unless expressly
provided in writing.
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10.2 NOTICES
All notices required or permitted to be given under this Agreement shall
be in writing. Notices may be served by certified or registered mail,
postage paid with return receipt requested; by private courier, prepaid; by
telex, facsimile, or other telecommunication device capable of transmitting
or creating a written record; or personally. Mailed notices shall be deemed
delivered two (2) days after mailing, properly addressed. Couriered notices
shall be deemed delivered on the date that the courier warrants that delivery
will occur. Telex, facsimile or telecommunication notices shall be deemed
delivered when receipt is either confirmed by confirming transmission
equipment or acknowledged by the addressee or its office. Personal delivery
shall be effective when accomplished. Unless a party changes its address by
giving notice to the other party as provided herein, notices shall be
delivered to the parties at the following addresses:
Surplus Software, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: President ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
10.3 INTEGRATION; AMENDMENT
This Agreement constitutes the entire agreement of the parties relating to
the subject matter hereof. There are no promises, terms, conditions,
obligations, or warranties other than those contained in this Agreement.
This Agreement supersedes all prior communications, representations, or
agreements, verbal or written, among the parties relating to the subject
matter hereof. This Agreement may not be amended except in a writing
executed by the parties.
10.4 SEVERABILITY
Any provision of this Agreement that is deemed invalid or unenforceable
shall be ineffective to the extent of such invalidity or unenforceability,
without rendering invalid or unenforceable the remaining provisions of this
Agreement. Furthermore, in lieu of each such invalid or unenforceable
provision, there shall be added automatically as a part of this Agreement a
provision as similar in terms to such invalid or unenforceable provision as
may be possible and be valid and enforceable.
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10.5 ASSIGNMENT
Employee shall not assign, sell, subcontract, delegate or otherwise
transfer his rights or obligations under this Agreement without the prior
written consent of the Employer, and any attempted assignment or delegation
shall be void and without effect.
10.6 GOVERNING LAW, SERVICE OR PROCESS AND VENUE
The parties hereto intend that this Agreement shall be governed by and
construed in accordance with the laws of the State of Oregon applicable to
contracts made and wholly performed within Oregon by persons domiciled in
Oregon.
10.7 ATTORNEYS' FEES AND COURT COSTS
If any suit or action arising out of or related to this Agreement is
brought by any party, the prevailing party or parties shall be entitled to
recover the costs and fees (including without limitation reasonable attorney
fees, the fees and costs of experts and consultants, copying, courier and
telecommunication costs, and deposition costs and all other costs of
discovery) incurred by such party or parties in such suit or action,
including without limitation any post-trial or appellate proceeding.
10.8 COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of which
taken together shall constitute one agreement binding on all the parties,
notwithstanding that all parties are not signatories to the same counterpart.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
EMPLOYER SURPLUS SOFTWARE, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------
Title: President
-------------------
EMPLOYEE /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Page 7
EXHIBIT A
ASSIGNMENT OF INVENTIONS AND
CONFIDENTIALITY AGREEMENT
Page A-1
ASSIGNMENT OF INVENTIONS AND
CONFIDENTIALITY AGREEMENT
This ASSIGNMENT OF INVENTIONS AND CONFIDENTIALITY AGREEMENT ("Agreement")
is entered into as of May 15, 1996 between Surplus Software, Inc., an Oregon
corporation (the "Company") and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ("Employee").
RECITAL
WHEREAS, Employee desires to obtain a position with the Company, and the
Company desires to obtain the services of Employee, but only expressly
subject to and conditioned upon Employee's agreeing to certain inventions and
confidentiality provisions set forth herein;
AGREEMENT
NOW, THEREFORE, in consideration of the Company's agreement to employ
Employee, the agreements herein expressed, and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties
agree as follows:
1. ASSIGNMENT OF INVENTIONS
Employee hereby assigns and transfers to the Company his or her entire
right, title and interest in and to all inventions, including but not be
limited to, products, ideas, improvements, designs and discoveries, including
computer software programs, internet applications and other intellectual
property, or improvements or enhancements to any of the foregoing, whether or
not patentable or copyrightable and whether or not reduced to practice
("Inventions"), made or conceived by Employee (whether made solely by
Employee or jointly with others) during the period of his or her employment
with the Company which relate in any manner to the actual or demonstrably
anticipated business, work, or research and development of the Company and
its affiliates, or result from or are suggested by any task assigned to him
or her or any work performed by him or her for or on behalf of the Company.
Employee agrees that all such Inventions and all associated United States and
foreign patent, copyright, trademark, trade secret and any other proprietary
rights, including, but not limited to, all rights of registrations and
renewal are the sole property of the Company.
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2. DISCLOSURE OF INVENTIONS. PATENTS
Employee agrees that in connection with any Invention as defined in
Section 1 above:
2.1 Employee will disclose such Invention promptly in writing to his or her
immediate superior at the Company in order to permit the Company to claim
rights to which it may be entitled under this Agreement. Such disclosure shall
be received in confidence by the Company.
2.2 Employee will, at the Company's request, promptly execute a written
assignment of title to the Company for any Invention required to be assigned by
Section 1 ("Assignable Invention") and Employee will preserve any such
Assignable Invention as confidential information of the Company.
2.3 Upon request, Employee agrees to assist the Company or its nominee
(at the Company's expense) during and at any time subsequent to his or her
employment in every reasonable way to obtain for the Company's own benefit,
patents and copyrights for such Assignable Invention in any and all
countries, which Assignable Invention shall be and remain the sole and
exclusive property of the Company or its nominee whether or not patented or
copyrighted. Employee agrees to execute such papers and perform such lawful
acts as the Company deems to be necessary to allow it to exercise all rights,
title and interest in such patents and copyrights.
3. EXECUTION OF DOCUMENTS
In connection with Section 2.3, Employee further agrees to execute,
acknowledge and deliver to the Company or its nominee upon request and at its
expense all such documents, including applications for patents and copyrights
and assignments of Inventions, patents and copyrights to be issued therefor,
as the Company may determine necessary or desirable to apply for and obtain
patents and copyrights on such Assignable Inventions in any and all countries
and/or to protect the interest of the Company or its nominee in such
Inventions, patents and copyrights and to vest title thereto in the Company
or its nominees. In the event that the Company is unable for any reason
whatsoever to secure Employee's signature to any lawful necessary document
required to apply for or execute any patent, copyright or other application
with respect to such Assignable Inventions, patents and copyrights, including
renewals, extensions, continuations, divisions or continuations in part
thereof, Employee hereby irrevocably constitutes and appoints the Company and
its duly authorized officers and agents, any one of them, as his or her
lawful and true attorneys-in-fact in his or her name, place and ▇▇▇▇▇, to
execute and file any such application and do all other lawfully permitted
acts to further the prosecution and
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issue of patents, copyrights or other rights thereon with the same legal
force and effect as if executed by Employee.
4. PROPRIETARY INFORMATION
Employee agrees that all Proprietary Information of which Employee may
acquire knowledge is the sole and exclusive property of the Company, and that
the Company shall retain all right, title and interest to the Proprietary
Information. Employee further agrees that Employee is not entitled to use
Proprietary Information for his or her own benefit or for the benefit of
others during or after the period of his or her employment, without the prior
written consent of the Company. As used herein, "Proprietary Information"
shall include, without limitation, information that has been created,
discovered, developed, or otherwise become known to the Company and/or in
which property rights have been assigned or otherwise conveyed to the
Company, which information has commercial value in the Company's business or
proposed business, including any trade secrets, confidential information,
knowledge, data or other information of the Company relating to products,
processes, know-how, designs, research, formulae, test procedures and
results, improvements, inventions or techniques, finances, customers,
vendors, services, business plans, marketing plans and strategies, pricing
strategies, or other subject matter pertaining to any business of the Company
for any of its clients, customers, consultants, licensees or affiliates.
Employee further agrees not to reproduce or in any way allow any such
Proprietary Information, knowledge, data or other information, or any
documentation relating thereto, to be delivered or used by any third party
without specific direction or consent of a duly authorized representative of
the Company. In the event of the termination of Employee's employment for any
reason whatsoever, Employee shall promptly return all records, materials,
equipment, drawings and the like pertaining to any Proprietary Information
and Employee shall not take any description or documents containing or
pertaining to any Proprietary Information, which Employee may have produced
or obtained during the course of employment with the Company. In the event
of termination of employment, Employee agrees to promptly sign and deliver to
the Company a certificate acknowledging the return of such Proprietary
Information and such other information as the Company requests.
5. CONFIDENTIAL RELATIONSHIP
Employee understands that his or her employment creates a relationship of
confidence and trust between Employee and the Company with respect to any
information: (a) applicable to the business of the Company; or (b)
applicable to the business of any supplier, consultant, independent
contractor, licensor, licensee, client, customer or affiliate of the Company,
which information may be made known to Employee by the Company or by any
supplier, consultant, independent contractor,
Page 3
licensor, licensee, client, customer or affiliate of the Company, or
information learned by Employee during the period of his or her employment.
Employee agrees to keep confidential, and not disclose or make any use of,
except for the benefit of the Company, at any time either during or
subsequent to Employee's employment, any Proprietary Information of which
Employee may acquire knowledge. Employee also agrees to employ all
reasonable measures to prevent the unauthorized use of the Proprietary
Information. Employee agrees that, in the event that Employee is served with
a subpoena or other compulsory judicial or administrative process calling for
production of Proprietary Information, Employee will immediately notify the
Company in order that the Company may take such action as it deems necessary
to protect its interests.
6. MAINTENANCE OF RECORDS
Employee agrees to keep and maintain adequate and current written records
of all Inventions made by him or her (in the form of notes, sketches,
drawings and as may be specified by the Company), which records shall be
available to and remain the sole property of the Company at all times.
7. PRIOR INVENTIONS
It is understood that all Inventions, if any, patented or unpatented or
copyrighted or uncopyrighted, which Employee made prior to his or her
employment by the Company or its affiliates, are excluded from the scope of
this Agreement. To preclude any possible uncertainty, Employee has set forth
on Exhibit A attached hereto a complete list of all of his or her prior
Inventions, including numbers of all patents and patent applications, and a
brief description of all unpatented Inventions which are not the property of
a previous employer. Employee represents and covenants that the list is
complete and that, if no items are on the list, Employee has no such prior
Inventions. Employee agrees to notify the Company in writing before Employee
makes any disclosure or performs any work on behalf of the Company which
appears to threaten or conflict with proprietary rights Employee claims in
any Invention or idea. In the event of his or her failure to give such
notice, Employee agrees that he or she will make no claim against the Company
with respect to any such Inventions or ideas.
8. TRADE SECRETS OF OTHERS
Employee represents and warrants that his or her performance of all of the
terms of this Agreement and as an employee of the Company does not and will
not breach any agreement to keep in confidence Proprietary Information,
knowledge or data acquired by him or her in confidence or in trust prior to
his or her employment with the Company, and Employee will not disclose to the
Company, or induce the
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Company to use, any confidential or proprietary information or material
belonging to any previous employer or others. Employee agrees not to enter
into any agreement either written or oral in conflict herewith.
9. BUSINESS OPPORTUNITIES
Employee will promptly disclose to the Company any business opportunity of
which Employee becomes aware of during his or her employment with the Company
which relates (i) to any products or services planned, under development,
developed, produced or marketed by the Company or (ii) of which Employee
becomes aware in the course of or as a result of his or her employment with
the Company. Employee will not take advantage of or divert any such
opportunity for the gain, profit or benefit of himself or herself or any
other person or entity without the written consent of the Company.
10. GENERAL PROVISIONS
10.1 GOVERNING LAW
This Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of Oregon applicable to contracts made
and wholly performed within Oregon by persons domiciled in Oregon.
10.2 ENTIRE AGREEMENT
This Agreement sets forth the entire agreement and understanding of the
parties relating to the subject matter hereof. No representation, promise or
inducement has been made by either party that is not embodied in this
Agreement, and neither party shall be bound by or liable for any alleged
representation, promise or inducement not so set forth.
10.3 ASSIGNABILITY
This Agreement, and Employee's rights and obligations hereunder, may not
be assigned or delegated by Employee. The Company may assign its rights
hereunder in connection with any sale, transfer or other disposition of all
or substantially all of its business or assets.
10.4 MODIFICATION
This Agreement may be amended, modified, superseded, canceled, renewed or
extended, and the terms or covenants hereof may be waived, only by a written
instrument executed by the Company. The failure of the Company at any time
or times to require performance of any provision hereof shall in no manner
affect the
Page 5
right at a later time to enforce the same. No waiver by the Company of the
breach of any term or covenant contained in this Agreement, whether by
conduct or otherwise, in any one or more instances shall be deemed to be, or
construed as, a further or continuing waiver of any such breach, or a waiver
of the breach of any other term or covenant contained in this Agreement.
10.5 ATTORNEYS' FEES
If any suit or action is instituted to enforce any of the terms of this
Agreement, or if any appeal is taken from any decision rendered hereunder,
the prevailing party shall be entitled to recover from the other party the
costs and fees (including, without limitation, attorneys' fees, the fees and
costs of experts and consultants, copying, courier and telecommunication
costs and deposition costs and all other costs of discovery) incurred by such
party in such suit or action, including without limitation, any post-trial or
appellate proceeding.
10.6 SPECIFIC PERFORMANCE
Employee is obligated to render services of a special, unique, unusual,
extraordinary, and intellectual character to the Company pursuant to his or
her employment with the Company, thereby giving this Agreement which is
executed in connection with such employment obligations peculiar value so
that the loss of any obligations under this Agreement could not be reasonably
or adequately compensated in damages in an action at law. Therefore, in
addition to other remedies provided by law, the Company shall have the right
to compel specific performance hereof by Employee and/or to obtain injunctive
relief or other equitable relief to prevent or curtail any breach of this
Agreement.
10.7 SEVERANCE
If any provision of this Agreement is or becomes invalid, illegal or
unenforceable, the remaining provisions shall remain in full force and
effect, and for the invalid, illegal or unenforceable provision shall be
substituted a valid, legal and enforceable provision which shall be as
similar as possible in economic and business objectives as intended by the
parties.
10.8 TERMINATION
This Agreement shall remain in full force and effect and survive
termination, for whatever reason, of Employee's employment with the Company.
Page 6
10.9 COUNTERPARTS
This Agreement may be executed in counterparts, all of which when taken
together shall constitute one Agreement binding on all parties,
notwithstanding that all parties are not signatories to the same counterpart.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first written above.
SURPLUS SOFTWARE, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------
Title: President
------------------
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Page 7
EXHIBIT A
LIST OF PRIOR INVENTIONS
Title Date Identifying Number or Brief Description
------------------------- --------- ---------------------------------------