EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement"), dated as of January 4, 2001,
between NEXSAN CORPORATION a Delaware corporation ("Company") and MARTIN BODDY
("Executive").
W I T N E S S E T H :
WHEREAS, the Company desires to employ Executive as its President and
Chief Executive Officer and Executive desires to accept such employment, upon
the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, the parties hereto agree as follows:
EMPLOYMENT
1.1 The Company hereby agrees to employ Executive, and Executive
hereby agrees to accept employment by the Company and to serve, as the President
and Chief Executive Officer, effective as of the consummation of the
transactions contemplated by (i) the Exchange Agreement among the Company and
the shareholders of Nexsan Technologies Ltd., and by (ii) the Stock Purchase
Agreement among the Company, Beechtree Capital LLC, and the purchasers of the
Company's common stock ("Common Shares") parties thereto (the "Effective Date").
1.2 The Executive agrees to undertake the duties and
responsibilities inherent in such position and such other duties and
responsibilities as the Board of Directors of the Company shall from time to
time reasonably assign to him. The Executive shall devote his full-time efforts
to the business of the Company and it Affiliates (defined below) so as to
increase the profitability and shareholder value of the Company; and the
Executive shall not be engaged in any other business activity during the
duration of this Agreement, unless written approval is first secured from the
Board of Directors of the Company.
1.3 Executive shall also serve at the option of the Company as an
officer or director of any other entity controlling, controlled by or under
common control with the Company (an "Affiliate") without additional
compensation, it being understood, however, that Executive is contemporaneously
herewith entering into a Contract of Employment with Nexsan Technologies, Ltd.
Without limiting the forgoing, during the term of this Agreement, the Executive
consents to being appointed as a member of the Company's Board of Directors.
1.4 The Executive agrees to abide by the rules, regulations,
instructions, personnel practices and policies of the Company and any changes
therein that may be adopted from time to time by the Company.
2. COMPENSATION
2.1 Base Salary
(a) The Company shall pay Executive a base salary ("Base Salary")
at the rate of $25,000 per year. Base Salary shall be payable in installments
consistent with the Company's payroll practices then in effect. The Company
shall increase the Base Salary annually, beginning on the second anniversary of
the Effective Date, by five percent (5%) over the Base Salary in effect the
previous year.
2.2 Stock Options
Intentionally omitted.
2.3 Additional Compensation
Nothing contained in this Agreement shall prevent the Board of
Directors of the Company, in its sole and absolute discretion, from, at any
time, increasing Executive's compensation either permanently or for a limited
period, whether in Base Salary or by bonus or otherwise, if the Board of
Directors, in its sole discretion, shall deem it advisable to do so in order to
recognize and fairly compensate the Executive for services rendered, provided,
that nothing in this sentence shall in any manner obligate the Board of
Directors to make any such increase or provide any such additional benefits.
2.4 Withholdings, Etc.
Payment of all compensation and benefits to Executive hereunder
shall be made in accordance with the relevant Company policies in effect from
time to time, including normal payroll practices, and shall be subject to all
applicable employment and withholding taxes.
3. BENEFITS
Executive shall be entitled to participate in all health care,
insurance, deferred compensation and other employee benefit plans generally
available to executives of the Company, consistent with the terms of those plans
as they may currently exist or be modified from time to time.
4. TERM AND TERMINATION
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4.1 Unless earlier terminated as provided herein, the initial term of
this Agreement and of Executive's employment hereunder shall commence on the
Effective Date and shall terminate on the fifth anniversary (the "Expiration
Date") of the Effective Date. Unless this Agreement shall have been earlier
terminated, the term of this Agreement and Executive's employment will be
extended automatically for successive one (1) year terms commencing on the
Expiration Date unless either party elects to terminate this Agreement by
providing written notice to the other party at least one hundred eighty (180)
days prior to the expiration of the Initial Term or any renewal term of this
Agreement.
4.2 This Agreement and Executive's employment hereunder shall
terminate:
(a) upon the death of Executive;
(b) upon written notice to Executive if, as a result of Executive's
incapacity due to physical or mental illness, Executive shall
have been unable to perform Executive's duties hereunder on a
full time basis for a consecutive period of one hundred twenty
(120) days or an aggregate of one hundred eighty (180) days
within any twelve-month period; or
(c) upon written notice to Executive, for Cause. "Cause" means (i)
any willful, material violation by the Executive of any law or
regulation applicable to the business of the Company or any
Affiliate; (ii) the Executive's conviction for, or guilty plea
or plea of nolo contendere to, a felony (other than a felony
related solely to automobile infractions, unless Executive is
incarcerated as a result thereof); (iii) the Executive's
commission of an act of personal dishonesty which involves
personal profit in connection with the Company or any other
entity having a business relationship with the Company, (iv)
gross carelessness or unjustifiable neglect of Executive's
duties or willful failure to follow the lawful orders of the
Board of Directors of the Company; (v) any material breach by
the Executive this Agreement; (vi) the Executive's violation of
any of the policies of the Company or any Affiliate so as to
cause loss, damage or injury to the property, reputation or
employees of the Company or any Affiliate, or (vi) any other
willful misconduct by the Executive which is materially
injurious to the business, financial condition or business
reputation the Company or any Affiliate.
4.3 Consequences of Termination
In the event that the Company terminates Executive's employment
pursuant to Section 4.2 then (a) the Executive's Base Salary shall be prorated
as of the date of termination or resignation and such prorated amount shall be
paid to Executive, and (b) the Company shall make such other and further
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payments to Executive as may be provided pursuant to the terms of any employee
benefit plan in which Executive is a participant at the time of termination, to
the extent payable upon such termination in accordance with such plans or
applicable Company policies.
5. ADDITIONAL AGREEMENTS AND UNDERSTANDINGS
5.1 Employment Location
The Executive shall perform the employment duties contemplated by this
Agreement from such location as the Company may from time to time specify, it
being understood that Executive's principal place of residence shall be the U.K.
The Executive acknowledges that his duties hereunder entail substantial travel.
5.2 Reimbursement of Expenses
Upon submission of itemized expense statements in the manner specified
by the Company, Executive shall be entitled to reimbursement for reasonable
travel and other reasonable business expenses duly incurred by Executive in the
performance of Executive's duties under this Agreement, all in accordance with
the policies and procedures established by the Company from time to time for the
Company's executives.
5.3 Company Property
Executive agrees that all operating and/or financial data and
projections, plans, contracts, agreements, literature, manuals, brochures,
books, schedules, correspondence and other materials furnished, disclosed or
otherwise made available to Executive by the Company or its Affiliates or
secured through the efforts of Executive, relating to the business conducted by
the Company and/or its Affiliates, are and shall remain the property of the
Company and/or its Affiliates, and Executive agrees to deliver all such
materials, including all copies or abstracts thereof, to the Company upon the
termination of Executive's employment hereunder, or at any other time at the
Company's request.
5.4 Confidential Information
Executive agrees that, except in the good faith performance of his
duties and responsibilities under this Agreement or as required by order of a
court or governmental agency having jurisdiction, he will not at any time during
or after his employment with the Company use, reveal, divulge or make known to
any person or entity any confidential or proprietary knowledge or information
concerning the Company or its Affiliates, including without limitation any such
information concerning any equipment, facilities, customers, end users,
contracts, leases, operating and/or financial data and projections, processes,
developments, schedules, lists, plans or other matters relating to the business
of the Company or its Affiliates and will retain all knowledge and information
Executive acquired during his
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employment therewith relating to the business of the Company or its Affiliates
in trust in a fiduciary capacity for the sole benefit of the Company, its
Affiliates and their respective successors and assigns. Executive's obligations
under this Section 5.4 shall not apply to any information that (i) is or becomes
known to the general public under circumstances involving no breach by Executive
of this Agreement, (ii) is generally disclosed to third parties (excluding
counsel, accountants, financial advisors, employees, agents and material
creditors of the Company) by the Company without restriction on such third
parties, or (iii) is approved for release by written authorization of the
President of the Company.
5.5 Developments
(a) Executive will make full and prompt disclosure to the Company
of all inventions, improvements, discoveries, methods, developments, software,
and works of authorship, whether patentable or not, which are created, made,
conceived or reduced to practice by the Executive or under his direction or
jointly with others during his employment by the Company, whether or not during
normal working hours or on the premises of the Company (all of which are
collectively referred to in this Agreement as "Developments").
(b) Executive agrees to assign and does hereby assign to the
Company (or any person or entity designated by the Company) all his right, title
and interest in and to all Developments and all related patents, patent
applications, copyrights and copyright applications.
(c) Executive agrees to cooperate fully with the Company, both
during and after his employment with the Company, with respect to the
procurement, maintenance and enforcement of copyrights and patents (both in the
United States and foreign countries) relating to Developments. Executive shall
sign all papers, including, without limitation, copyright applications, patent
applications, declarations, oaths, formal assignments, assignment of priority
rights, and powers of attorney, which the Company may deem necessary or
desirable in order to protect its rights and interests in any Development.
5.6 Non-Competition
While employed hereunder and for a period of one (1) year
thereafter, Executive shall not (i) enter into the employment of, or act as a
consultant, director, officer, or employee of, or render any service or advice
to, any other business, partnership, association, corporation or other entity
which directly engages in competition in any material respect with any business
presently carried on or under development, or which hereafter during the period
of his employment by the Company shall be carried on or be under development by
the Company and which is then being carried on by the Company, in the United
States or any foreign country where such business is then or was within the one
year period ending on the date of termination conducted, other than the Company
or any Affiliate (a "Competing Business") or (ii) invest or otherwise acquire
any interest, whether as a shareholder, lender, partner, proprietor, vendor or
otherwise, in any Competing
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Business (excluding ownership of less than 2% of a class of securities of a
publicly-traded company). While employed hereunder and for a period of one (1)
year after termination of employment, Executive shall not encourage, solicit, or
attempt to induce (or assist others to encourage, solicit, or attempt to induce)
any customer of the Company or any user of products of the Company to reduce,
restrict, or terminate its business relationship with the Company or any
reseller which is a customer of the Company or its use of products, or products
which incorporate products, manufactured by the Company, or to shift its
business from the Company or any such reseller to any other supplier of
competing goods or services
5.7 Non-Solicitation
While employed hereunder and for a period of one (1) year
thereafter, Executive shall not, directly or indirectly, entice, induce or in
any manner influence any person who is, or shall have been during such period,
in the service of the Company or its Affiliates, or employed or engaged by or
otherwise associated with any person or entity, to leave such service.
5.8 Survival, Rights and Remedies
The provisions of this Section 5 shall survive the termination of
this Agreement and the termination of Executive's employment with the Company
and shall run to and inure to the benefit of the Company and its successors and
assigns. Executive represents, warrants and acknowledges that he has carefully
read this Section 5, that he has had an opportunity to have the provisions
contained herein explained to him by his attorney, and that he understands the
provisions contained herein. Executive further acknowledges that, by reason of
his training, skills, experience and employment hereunder, the services to be
rendered by him under the provisions of this Agreement and their value to the
Company are of a special, unique and extraordinary character and that it would
be difficult or impossible to replace such services, and he further acknowledges
that a violation by him of any of the provisions of this Section 5 could cause
continuing material and irreparable injury to the Company and that in such event
money damages would not be readily calculable and the Company would not have an
adequate remedy at law. Executive acknowledges and agrees that (i) the
restrictions under this Section 5 are reasonable and will not interfere with
Executive's ability to earn a livelihood or impose upon him any undue hardship,
and (ii) any breach of the covenants, provisions and restrictions contained in
this Section 5 shall cause, and shall be deemed to be, a fundamental and
material breach of Executive's fiduciary and contractual obligations to
Employer. Therefore, Executive agrees that the Company shall be authorized and
entitled to obtain from any court of competent jurisdiction, interim and
permanent equitable relief, including without limitation, injunctive relief, in
the event of any such breach or threatened breach of the provisions of this
Section 5, together with payment of reasonable attorneys' fees and disbursements
and any other costs of enforcement incurred in connection with such breach or
threatened breach. These rights and remedies shall be cumulative and shall be in
addition to any other rights or remedies whatsoever to which the Company shall
otherwise be entitled hereunder, at
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law or otherwise, including the right to seek damages (including any
consequential damages) which any court of competent jurisdiction may deem
appropriate.
6. APPLICABLE LAW; ARBITRATION
This Agreement shall in all respects, including all matters of
construction, validity and performance, be governed by and construed and
enforced in accordance with the laws of the State of New York. Except as
provided in Section 5.8, any controversy or claim arising under the provisions
of this Agreement or of any breach or alleged breach thereof shall be subject to
mediation under the auspices of the American Arbitration Association in New
York, New York or any other location mutually agreeable to the parties, and, if
not resolved thereby, shall be settled by arbitration, before a single
arbitrator sitting in New York, New York or any other location mutually
agreeable to the parties, in accordance with the Commercial Arbitration Rules of
the American Arbitration Association, and judgment upon the award rendered by
the arbitrator may be entered in any court having jurisdiction. The arbitrator
shall be authorized to decree any and all relief of an equitable nature, and
shall also be authorized to award damages and costs. Notwithstanding the
foregoing, in the extent of a breach or impending breach of this Agreement,
either party may seek an injunction, restraining order or other equitable relief
from any court of competent jurisdiction.
7. SUCCESSORS
This Agreement and all rights of Executive hereunder shall inure to the
benefit of and be enforceable by Executive's personal or legal representatives,
executors, administrators, successors, heirs, distributees, devisees and
legatees. If Executive should die while any amounts still are payable to him
hereunder if he had continued to live, all such amounts, unless otherwise
provided herein, shall be paid in accordance with the terms of this Agreement to
Executive's devisee, legatee, or other designee or, if there be no such
designee, to Executive's estate.
8. MISCELLANEOUS
8.1 Entire Agreement
This Agreement constitutes the entire agreement between the parties
and supersedes all prior agreements and understandings, whether written or oral,
relating to the subject matter of this Agreement.
8.2 Notices
Every notice required by the terms of this Agreement shall be given
in writing by serving the same upon the party to whom it was addressed
personally or by registered or certified mail,
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return receipt requested, at the address set forth below or at such other
address as may hereafter be designated by notice given in compliance with the
terms hereof:
If to Executive:
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If to Company: Nexsan Corporation
c/o Beechtree Capital Ltd.
1 Rockefeller Plaza
New York, New York 10020
and Nexsan Technologies, Ltd.
Imperial House
East Service Road
Rayneway
Derby DE21 7BF
England
with a copy to: RubinBaum LLP
30 Rockefeller Plaza
New York, New York 10112
Attn.: Michael Emont, Esq.
Facsimile No.: (212) 698-7825
or such other address as shall be provided in accordance with the terms hereof.
Such notice shall be effective upon mailing.
8.3 Other Agreements
Executive hereby represents that he is not bound by the terms of any
agreement with any previous employer or other party to refrain from using or
disclosing any trade secret or confidential or proprietary information in the
course of his employment with the Company or to refrain from competing, directly
or indirectly, with the business of such previous employer or any other party.
Executive further represents that his performance of all 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 in confidence or in trust prior to his employment with the
Company.
8.4 Assistance In Proceedings, Etc.
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After termination of his employment, and upon reasonable notice,
Executive shall furnish such information and proper assistance to the Company as
may reasonably be required by the Company in connection with any legal or
quasi-legal proceeding, including any external or internal investigation,
involving the Company or any of its affiliates or in which any of them is, or
may become, a party. The Company shall compensate Executive at the rate of
$1,000 per hour for any such services performed after termination and will
reimburse Executive for all reasonable expenses incurred in connection therewith
in accordance with the provisions of Section 2 of this Agreement..
8.5 Waivers
No delay or failure by any party hereto in exercising, protecting
or enforcing any of its rights, titles, interests or remedies hereunder, and no
course of dealing or performance with respect thereto, shall constitute a waiver
thereof. The express waiver by a party hereto of any right, title, interest or
remedy in a particular instance or circumstance shall not constitute a waiver
thereof in any other instance or circumstance. All rights and remedies shall be
cumulative and not exclusive of any other rights or remedies.
8.6 Amendments in Writing
No amendment, modification, waiver, termination or discharge of any
provision of this Agreement, nor consent to any departure therefrom by either
party hereto, shall in any event be effective unless the same shall be in
writing, specifically identifying this Agreement and the provision intended to
be amended, modified waived, terminated or discharged and signed by the Company
and the Executive, and each such amendment, modification, waiver, termination or
discharge shall be effective only in the specific instance and for the specific
purpose for which given. No provision of this Agreement shall be varied,
contradicted or explained by any oral agreement, course of dealing or
performance or any other matter not set forth in an agreement in writing and
signed by the Company and the Executive.
8.7 Severability
If any provision of this Agreement shall be held invalid, illegal
or unenforceable in any jurisdiction, for any reason, including, without
limitation, the duration of such provision, its geographical scope or the extent
of the activities prohibited or required by it, then, to the full extent
permitted by law, (a) all other provisions hereof shall remain in full force and
effect in such jurisdiction and shall be liberally construed in order to carry
out the intent of the parties hereto an nearly as may be possible, (b) such
invalidity, illegality or unenforceability shall not affect the validity,
legality or enforceability of any other provision hereof, and (c) any court or
arbitrator having jurisdiction thereover shall have the power to reform such
provision to the extent necessary for such provision to be enforceable under
applicable law.
8.8 Cooperation.
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Upon termination of employment with the Company, Executive shall
cooperate with the Company, as reasonably requested by the Company, to effect a
transition of Executive's responsibilities and to ensure that the Company is
aware of all matters which had been handled by Executive. The Company will
reimburse Executive for all reasonable expenses incurred in connection
therewith.
8.9 Protection Of Reputation.
From the date hereof, Executive agrees that he will take no action
which is intended, or could reasonably be expected, to harm the Company or its
reputation or which could reasonably be expected to lead to unwanted or
unfavorable publicity to the Company, provided, that nothing in this Section 8.9
shall affect the ability of Executive to enforce any remedy available at law or
in equity.
8.10 Counterparts
This Agreement may be executed in counterparts, each of which
counterpart shall be deemed an original, but all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed and entered into this
Agreement on the 4th day of January, 2001
NEXSAN CORPORATION
By: /s/ Martin Boddy
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Title: CEO
/s/ Martin Boddy
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Martin Boddy