EMPLOYMENT AGREEMENT BETWEEN BLUEGATE CORPORATION AND CHARLES E. LEIBOLD
Exhibit
10.1 Employment
Agreement of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
BETWEEN
BLUEGATE CORPORATION AND
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇
This
Employment agreement (the "Agreement") is made effective as of the 1st day
of
June 2006, by and between Bluegate Corporation, a Nevada corporation
("Bluegate"), and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (the "Executive").
WHEREAS,
The Executive is willing to be employed by Bluegate from and after the effective
date on the basis and terms and conditions set forth in this
Agreement.
THEREFORE,
upon the mutual promises and covenants of the parties, and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, and intending to be legally bound, the parties agree as
follows:
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1.
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Employment.
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Bluegate
hereby employs the Executive, and the Executive hereby accepts such employment,
for the period stated in section (3) below and upon the other terms and
conditions herein provided.
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2.
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Position
and Duties.
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During
the Employment Period the Executive agrees to serve as Chief Financial Officer
("CFO") of Bluegate. In his capacity of CFO, the Executive will perform such
duties and responsibilities for Bluegate as may from time to time be assigned
to
him by the Board of Directors of Bluegate.
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3.
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Term.
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By
this
Agreement, Bluegate employs the Executive, and the Executive accepts employment
with Bluegate, for a period consisting of two (2) years, commencing on the
date
of this Agreement and will cover the period from June 1, 2006 through May 31,
2008.
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4.
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Compensation.
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In
consideration of such service, Bluegate agrees to pay the Executive as
compensation an annual salary of $140,000.00, in accordance with Bluegate's
regular payroll practices in effect from time to time. Effective on January
1,
2007, the annual salary will increase by 5.0%, to $147,000.00.
Stock
Options.
In
addition to the compensation set forth above, the Executive shall be entitled
to
receive options to purchase 600,000 shares of Bluegate shares of common stock,
par value $.001 per share, ("Option Shares"), at the per-share option price
of
$0.75 pursuant to a Stock Option Agreement being entered into in connection
herewith. This option shall become vested and exercisable with respect to 50,000
Option Shares on June 1, 2006 (upon the execution and delivery of the related
Stock Option Agreement), and this option shall become vested and exercisable
with respect to 25,000 Option Shares every 30 days thereafter until this option
becomes fully vested.
The
Option Shares to be issued pursuant to this Agreement shall be restricted
securities with piggy back registration rights, and shall terminate and become
null and void after the expiration of five (5) years from the date of
grant.
Bonus.
In
addition to the compensation set forth above, Executive
and Bluegate agree to enter into good faith negotiations with a view to reaching
an agreement on the payment of one or more bonuses (the "Bonuses") in such
amounts as are mutually agreed upon by Executive and Bluegate, if major
transactions (such as acquisitions and financings) agreed mutually upon by
them
shall be achieved. The Bonuses shall be payable at such time as is
mutually agreed upon by Executive and Bluegate. The Executive and Bluegate
agree
that they intend for these good faith negotiations (i.e., to mutually define
the
bonus-triggering transactions, milestones, and/or achievements, as well as
the
associated pay-out metrics) to be completed by no later than 30 days from start
date.
Deferred
Signing Bonus.
In
addition to the compensation set forth above, a deferred signing bonus of
$20,000.00 will be paid to Executive and included in his bi-monthly payroll
as
follows: $5,000.00 on the last day of September, October, November and December
2006. This bonus can be converted to Bluegate shares at the rate of $0.75 per
share at the sole option of Executive.
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5.
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(Intentionally
Left Blank)
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6.
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Confidentiality.
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In the course of
the performance of Executive's duties hereunder, Executive recognizes and
acknowledges that Executive may have access to certain confidential and
proprietary information of Company or any of its affiliates.
Without the prior written consent of Company, Executive shall not
disclose any such confidential or proprietary information to any person or
firm, corporation, association, or other
entity for any reason or purpose whatsoever, and
shall not use such information, directly or indirectly, for
Executive's own behalf or on behalf of any other party.
Executive agrees and affirms that all such information is the sole
property of Company and that at the termination and/or
expiration of this Agreement, at Company's written
request, Executive shall promptly return to Company any and all such information
so requested by Company.
The
provisions of this Section shall not, however, prohibit Executive from
disclosing to others or using in any manner information that:
(a)
has been published or has become part of the public
domain other than by acts, omissions or fault of Executive;
(b)
has been furnished or made known to Executive by third parties (other than
those
acting directly or indirectly for or on behalf of Executive) as a matter of
legal right without restriction on its use or disclosure;
(c)
was in the possession of Executive prior to obtaining such information from
Company in connection with the performance of this Agreement; or
(d)
is required to be disclosed by law.
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7.
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Indemnification.
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The
Company shall to the full extent permitted by law or as set
forth in the Articles of Incorporation and the Bylaws of the Company,
indemnify, defend and hold harmless Executive from and against any and all
claims, demands, liabilities, damages, loses
and expenses (including reasonable attorney's
fees, court costs and disbursements) arising out of the performance
by him of his duties hereunder except in the case of his
willful misconduct.
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8.
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Termination.
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This
Agreement and the employment relationship created hereby will terminate (i)
with
cause under Section 8(a); or (ii) upon the voluntary termination of employment
by Executive under Section8 (b).
(a)
With
Cause.
The Company may terminate this Agreement at any time because of (i) the
determination by the Board of Directors in the exercise of its reasonable
judgment that Executive has committed an act or acts constituting a felony
or
other crime involving moral turpitude, dishonesty or theft or fraud; or (ii)
Executive's willful misconduct in the performance of his duties hereunder,
provided, in each case, however, that the Company shall not terminate this
Agreement pursuant to this Section unless the Company shall first have
delivered to the Executive, a notice which specifically identifies
such breach or misconduct and the executive shall not have cured the same within
fifteen (15) days after receipt of such notice.
(b)
Voluntary Termination.
The Executive may terminate his employment voluntarily.
Obligations
of Company Upon Termination.
In
the event of the termination of Executive's employment pursuant to Section
8 (a)
or (b), Executive will be entitled only to the compensation earned by him
hereunder as of the date of such termination (plus any life insurance benefits).
In the event of the termination of Executive's employment for any reason
other than Section 8 (a) or (b) as described immediately above, all compensation
of every nature described in this Agreement shall immediately vest and become
due and owing to Executive.
In
the
event of the Death of the Executive prior to the end of the Term of this
Agreement, Executive’s spouse shall be entitled to receive Compensation pursuant
to this Agreement through the end of its Term as it accrues.
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9.
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Waiver
of Breach.
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The
waiver by any party hereto of a breach of any provision of this Agreement
will not operate or be construed as a waiver of any subsequent breach by any
party.
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10.
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Arbitration.
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If
a
dispute should arise regarding this Agreement the parties agree that all claims,
disputes, controversies, differences or other matters in question arising out
of
this relationship shall be settled finally, completely and conclusively by
arbitration in Houston, Texas in accordance with the Commercial Arbitration
Rules of the American Arbitration Association (the "Rules"). The governing
law of this Agreement shall be the substantive law of the State of Texas,
without giving effect to conflict of laws. A decision of the arbitrator
shall be final, conclusive and binding on the Company and Executive.
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11.
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Covenant
Not to Compete.
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So
long
as the Executive is employed by the Company and for a period of eighteen (18)
months after either (i) the voluntary termination of employment by Executive
or
(ii) the termination of the Executive by the Company for cause, as set forth
in
Section 8(b) hereof, the Executive specifically agrees that he will not, for
himself, on behalf of, or in conjunction with any person, firm, corporation
or
entity, other than the Company (either as principal, employee, shareholder,
member, director, partner, consultant, owner or part-owner of any corporation,
partnership or any type of business entity) anywhere in any county in which
the
Company is doing business at the time of termination, directly or indirectly,
own, manage, operate, control, be employed by, participate in, or be connected
in any manner with the ownership, management, operation, or control of any
business similar to the type of business conducted by the Company at the time
of
termination of the Executive's employment.
Executive's
Acknowledgments and Agreements.
The Executive acknowledges and agrees that:
(1)
Due to the nature of the Company's business, the foregoing covenants place
no
greater restraint upon the Executive than is reasonably necessary to protect
the
business and goodwill of the Company;
(2)
These covenants protect a legitimate interest of the Company and do not serve
solely to limit the Company's future competition;
(3)
This Agreement is not an invalid or unreasonable restraint of
trade;
(4)
A breach of these covenants by the Executive would cause irreparable damage
to
the Company;
(5)
These covenants will not preclude the Executive from becoming gainfully
employed following termination of employment with the Company;
(6)
These covenants are reasonable in scope and are reasonably necessary to protect
the Company's business and goodwill and valuable and extensive trade which
the
Company has established through its own expense and effort;
(7)
The signing of this Agreement is necessary for the Executive's employment;
and
(8)
He has carefully read and considered all provisions of this Agreement and that
all of the restrictions set forth are fair and reasonable and are reasonably
required for the protection of the interests of the Company.
Remedies,
Injunction.
In the event of the Executive's actual or threatened breach of any provisions
of
this Agreement, the Executive agrees that the Company shall be entitled to
a
temporary restraining order, preliminary injunction and/or permanent injunction
restraining and enjoining the Executive from violating the provisions
herein. Nothing in this Agreement shall be construed to prohibit the
Company from pursuing any other available remedies for such breach or threatened
breach, including the recovery of damages from the Executive. The
Executive further agrees that for the purpose of any such injunction proceeding,
it shall be presumed that the Company's legal remedies would be inadequate
and
that the Company would suffer irreparable harm as a result of the Executive's
violation of the provisions of this Agreement. In any proceeding brought
by the Company to enforce the provisions of this Agreement, no other matter
relating to the terms of any claim or cause of action of the Executive against
the Company will be defense thereto. The foregoing remedy provisions are
subject to the provisions of §15.51 of the Texas Business and Commerce Code, as
amended (the "Code"), which Code provisions shall control in the event of any
conflict between the provisions hereof and the Code or any other law in effect
relevant and applicable hereto.
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12.
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Benefits
Insurance.
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(i)Medical,
Dental and Vision Benefits.
During this Agreement, Executive and his dependents will be entitled to
receive such group medical, dental and vision benefits as Company may provide
to
its other executives, provided such coverage is reasonably available, or be
reimbursed if Executive is carrying his own similar insurance.
(ii)Benefit
Plans.
The Executive will be entitled to participate in any benefit plan or
program of the Company which may currently be in place or implemented in
the future.
(iii)Other
Benefits.
During the Term, Executive will be entitled to receive, in addition to and
not
in lieu of base salary, bonus or other compensation, such other benefits
and normal perquisites as Company currently provides or such additional benefits
as Company may provide for its executive officers in the
future.
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13.
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Vacation
and Sick Leave.
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Vacation
Pay.
The
Executive shall be entitled to an annual vacation leave of four (4) weeks at
full pay. Executive is specifically permitted to work from home or other
remote location in his discretion, which time shall not be considered as
vacation leave.
Sick
Pay.
The
Executive shall be entitled to sick leave as needed.
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14.
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Reimbursement
of Expenses.
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Upon
submission of a detailed statement and reasonable documentation, Company will
reimburse Executive in the same manner as other executive officers for all
reasonable and necessary or appropriate out-of-pocket travel and other expenses
incurred by Executive in rendering services required under this Agreement.
Executive shall be entitled to a $750.00 per month car
allowance.
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15.
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Withholding
of Taxes.
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Bluegate
may withhold from any payments under this Agreement all applicable taxes, as
shall be required pursuant to any law or governmental regulation or
ruling.
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16.
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Entire
Understanding.
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This
Agreement sets forth the entire understanding between the parties with respect
to the subject matter hereof and cancels and supersedes all prior oral and
written agreements between the parties with respect to the subject matter
hereof.
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17.
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Severability.
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If
for
any reason any provision of this Agreement shall be held invalid, such
invalidity shall not affect any other provision of this Agreement not held
so
invalid.
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18.
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Governing
Law.
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This
Agreement has been executed and delivered in the State of Texas and its
validity, interpretation, performance and enforcement shall be governed by
and
construed in accordance with the laws thereof applicable to contracts executed
and to be wholly performed in Texas.
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19.
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Notices.
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All
notices shall be in writing and shall have been duly given if delivered by
hand
or mailed, certified or registered mail, return receipt requested to the
following address or to such other address as either party may designate by
like
notice:
If
to Executive:
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇
If
to Bluegate:
Attn:
Chairman of the Board of Directors
▇▇▇
▇.
▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇
Bluegate
has caused this Agreement to be executed by its officer and the Executive has
signed this Agreement.
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Successors,
Binding Agreement.
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This
Agreement is binding upon Bluegate’s successors. Bluegate will require any
successor (whether direct or indirect, by purchase, merger, consolidation,
or
otherwise) to all or substantially all of the business and/or assets of Bluegate
to expressly assume and agree to perform this Agreement in the same manner
and
to the same extent that Bluegate would be required to perform it as if no such
succession had taken place. Failure of Bluegate to obtain such assumption
and agreement prior to the effectiveness of any such succession shall constitute
a breach of this Agreement.
This
Agreement shall inure to the benefit of both Bluegate and its successors and
assigns and the Executive and his personal or legal representatives, executors,
administrators, heirs, distributes, successors and assigns.
| Bluegate: | Executive: |
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/s/
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▇. ▇▇▇▇▇▇▇
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/s/
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▇. ▇▇▇▇▇▇▇
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President
and COO
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