APROPOS TECHNOLOGY, INC.
ONE TOWER LANE
SUITE 2850
OAKBROOK TERRACE, IL 60181
March 18, 2005
Mr. David E. McCrabb, Jr. 17600 Bruce Avenue Los Gatos, CA 95030
Dear David:
It is my pleasure to confirm with you the continuation of your employment on an
interim basis as President and Chief Executive Officer of Apropos Technology,
Inc. (the "Company") through June 30, 2005. The points below set forth the terms
of your employment.
o Your annual salary will be $300,000, payable in accordance with the
standard payroll practice of the Company.
o Your Target Award under the Company's 2005 Incentive Bonus Award
Program for Senior Executives (the "Program") will be $200,000, with
the percentage payout determined by the Revenue Plan/Profit Plan Bonus
Matrix for Q1 and Q2; provided, that the amount paid shall be not less
than $100,000.
o The Company will continue to reimburse you for reasonable travel
expenses and temporary living expenses, including continuation of your
current apartment rental, as well as automobile expense and
reimbursement for coach airfare between Chicago and California.
You will assist the Company and its advisors in finding a candidate to fill
the position of President and Chief Executive Officer on a permanent
basis.
o You will be entitled to all customary benefits provided to Company
employees, including vacation, subject to the right of the Company to
amend, modify or terminate any benefit plans or policies.
o It is expected that you will devote all of your customary working hours
to the attention of the affairs and activities of the Company.
o You represent that this employment relationship does not breach any
contractual relationship or other obligation toward any other person or
entity.
David E. McCrabb, Jr.
March 18, 2005
Page 2
o You agree to the continuation of the confidentiality, ownership of
invention, noncompetition and related provisions contained on Annex A
hereto. The term "Employee" in the Annex refers to you.
Your employment is at will and may be terminated prior to June 30, 2005 by you
or the Company upon thirty days advance written notice (or pay in lieu of such
notice) for any reason or no reason. If your employment is terminated by the
Company prior to June 30, 2005, you will continue to receive your salary and
will be entitled to your award under the Program, which shall be not less than
$100,000. If you terminate your employment prior to June 30, 2005, your salary
will be discontinued and you will not be entitled to any bonus payment under the
Program.
It is understood that you are employed by the Company on an interim basis with
no expectation of continued employment following transition of your duties to
another individual. Except as required by law, you are not entitled to any
severance or other benefits following termination of employment for any reason.
All payments described above are subject to applicable withholding requirements.
This Agreement shall be governed by the substantive laws of the State of
Illinois and not the conflict of law rules. This letter represents our entire
agreement. This letter replaces the letter dated July 30, 2004, which is
terminated and shall be of no further force or effect. It may be executed in
counterparts. You have not relied on any representation other than as contained
in this letter. No amendment of these terms is effective, if not in writing.
Very truly yours,
APROPOS TECHNOLOGY, INC.
By: /s/ Keith Crandell
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Keith Crandell
Compensation Committee
Chairman
ACCEPTED AND AGREED:
/s/ David E. McCrabb, Jr.
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David E. McCrabb, Jr.
ANNEX A
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1. CONFIDENTIALITY. Employee understands and agrees that
Employee's employment creates a relationship of confidence and trust
between Employee and the Company with respect to (a) all Proprietary
Information (as defined below), and (b) the confidential information of
others with which the Company has a business relationship. The
information referred to in clauses (a) and (b) of the preceding
sentence is referred to in this Agreement, collectively, as
"Confidential Information". At all times, both during Employee's
employment with the Company and after its termination, Employee will
keep in confidence and trust all such Confidential Information, and
will not use or disclose any such Confidential Information without the
written consent of the Company, except as may be necessary in the
ordinary course of performing Employee's duties to the Company. The
restrictions set forth in this Section will not apply to information
which is generally known to the public or in the trade, unless such
knowledge results from an unauthorized disclosure by Employee, but this
exception will not affect the application of any other provision of
this Agreement to such information in accordance with the terms of such
provision.
2. OWNERSHIP OF INVENTIONS. Employee agrees that all
Inventions (as defined below) which Employee conceives or develops, in
whole or in part, either alone or jointly with others, prior to or
during the term of Employee's employment with the Company which may
relate in any manner to the actual or anticipated business, work,
research, development or investigations of the Company, or which
result, to any extent, from the work performed by Employee for the
Company, or use of the Company's Proprietary Information, premises or
property (the foregoing being hereinafter collectively referred to as
"Company Inventions") will be the sole property of the Company. The
Company will be the sole owner of all patents, copyrights and other
proprietary rights in and with respect to such Company Inventions. To
the fullest extent permitted by law, such Company Inventions will be
deemed works made for hire. Employee hereby transfers and assigns to
the Company or its designee any proprietary rights which Employee may
have or acquire in any such Company Inventions, and Employee waives any
moral rights or other special rights Employee may have or accrue
therein. Employee agrees promptly to disclose to the Company, or any
persons designated by it, all Company Inventions which are or may be
subject to the provisions of this Section. Employee agrees to execute
any documents and take any actions that may be required to effect and
confirm such transfer and assignment and waiver. The provisions of this
Section will apply to all Company Inventions which are conceived or
developed during the term of Employee's employment with the Company,
whether before or after the date of this Agreement, and whether or not
further development or reduction to practice may take place after
termination of Employee's employment. The provisions of this Section
will not apply, however, to any Inventions which may be disclosed in a
separate Schedule attached to this Agreement prior to its acceptance by
the Company, representing Inventions made by Employee prior to
employment by the Company. The foregoing restrictions do not apply to
an invention for which no equipment, supplies, facility or trade secret
information of the Company was used and which was developed entirely on
Employee's own time, unless (a) the invention relates (i) to the
business of the Company or (ii) to the Company's actual or demonstrably
anticipated research or development, or (b) the invention results from
or is the product of any work performed by Employee for the Company in
the scope of Employee's efforts on behalf of the Company.
3. NONCOMPETITION. Employee agrees that, while employed by
Company and for a period of eighteen (18) months following termination
of his employment with Company, regardless of the circumstances under
which Employee's employment is terminated and regardless of whether the
termination was voluntary or involuntary or with or without cause,
Employee shall not, directly or indirectly, whether as a partner,
owner, principal, agent, advisor, employee, employer, officer,
director, shareholder or in any other capacity:
(a) Engage in, advise or provide services in the Territory to
any person or entity engaged in any business that is in any material
way directly competitive with the business conducted by the Company.
The Territory shall mean the United States and those countries in
Europe in which the Company distributes products.
(b) Solicit for employment or employ or otherwise engage any
person employed by the Company during Employee's term of employment or
request, or advise any such person to leave such employment or service
of the Company.
Notwithstanding the foregoing, Employee may make investments in publicly-held
corporations if such investment is limited to not more than five percent (5%) of
the outstanding issue of such security.
Employee agrees that if he breaches this agreement, then the eighteen (18) month
restrictive period shall be extended and shall not expire until eighteen (18)
months after Employee permanently ceases to breach this Agreement.
4. ENFORCEMENT.
(a) Employee acknowledges that, for the breach of any of the
covenants contained in this Annex, the Company will suffer irreparable
damages for which the remedy at law will be inadequate, and that, an
injunction may be entered against Employee by any court having
jurisdiction, restraining Employee from breaching or continuing the
breach. Employee consents to the personal jurisdiction of DuPage
County, Illinois, and the United States District Court for the Northern
District of Illinois for purposes of enforcement of this Annex. Resort
to such equitable relief, however, shall not be construed to be a
waiver by the Company of any other rights or remedies that the Company
may have for damages or otherwise. Should a court determine that either
the scope or territory covered by the covenants is unreasonably
extensive or the period of the covenants unreasonably long, it may
amend the terms of such covenants so as to make such covenants
reasonable and enforceable.
(b) Employee hereby acknowledges the necessity of protection
of the Company against Employee's competition and that the nature and
scope of such protection has been carefully considered by Employee and
the Company. Employee and the Company hereby agree that the unique
nature of the business of the Company requires the protection specified
in this Agreement. The consideration provided for these covenants is
deemed to be sufficient and adequate to compensate Employee for
agreeing to the restrictions contained herein. Employee acknowledges
and represents that Employee can continue to earn sufficient
compensation without breaching any of the foregoing restrictions. The
scope and period provided and the area covered are expressly
represented and agreed by the Employee to be fair, reasonable and
necessary.
(c) The covenants and provisions of this Agreement are
severable. The Company and the Employee agree that the restrictions
imposed herein are reasonably necessary to protect the legitimate
business interests of the Company. However, if any provision or
covenant of this Agreement were held to be unenforceable as written,
then the Company and the Employee agree that the provision or covenant
shall be construed in order that it shall be enforced to the greatest
extent possible and, if such construction and enforcement is not
possible, then the remainder of this Agreement shall be enforced as if
such invalid covenant or provision were not contained in this
Agreement.
* * *
PROPRIETARY INFORMATION. As used in this Annex, "Proprietary Information" means
information which the Company possesses or to which the Company has rights which
has commercial value. Proprietary Information includes, by way of example and
without limitation, trade secrets, product ideas, designs, configurations,
processes, techniques, formula, software, source and object code, domain names,
improvements, inventions, data, know-how, copyrightable materials, marketing
plans and strategies, sales and financial reports and forecasts, and customer
lists. Proprietary Information includes information developed by Employee to be
used in the business of the Company, whether before or in the course of
Employee's employment by the Company or otherwise relating to Inventions which
belong to the Company, as well as other information to which Employee may have
access in connection with Employee's employment.
INVENTIONS. As used in this Annex, "Inventions" means any and all inventions,
developments, creative works and useful ideas of any description whatsoever,
whether or not patentable. Inventions include, by way of example and without
limitation, discoveries and improvements that consist of or relate to any form
of Proprietary Information.
COMPANY. For purposes of this Annex, all references to the "Company" will be
deemed to include Apropos Technology, Inc., its successors, and its direct or
indirect subsidiaries and affiliates.