Exhibit 10.3
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into as
of the 1st day of May, 2000, by and between Knowledge Foundations, Inc., a
Delaware corporation ("Employer"), and Michael W. Dochterman ("Employee").
W I T N E S S E T H:
WHEREAS, the officers, managers and/or directors of Employer are of the
opinion that Employee has education, experience and/or expertise which is of
value to Employer and its owners, and
WHEREAS, Employer and Employee desire to enter into this Employment
Agreement, pursuant to which Employee shall be employed by Employer, to set
forth the respective rights, duties and obligations of the parties hereto.
NOW THEREFORE, in consideration of the promises and covenants contained
herein, and other good and valuable consideration, the receipt and
sufficiency of which the parties hereto acknowledge, Employer and Employee
agree as follows:
1. EMPLOYMENT. Employer hereby agrees to employ Employee and Employee
hereby accepts such employment, upon the terms and conditions hereinafter set
forth.
2. TERM. For purposes of this Agreement, "Term" shall mean the original
term (as defined in Section 2.1 below) and the renewal term (as defined in
Section 2.2 below), if applicable.
2.1 Original Term: The Term of this Agreement shall commence on May 1, 2000
and expire on March 31, 2004, unless sooner terminated pursuant to the terms
and provisions herein stated.
2.2 Renewal Term: This Agreement shall automatically be extended for
additional one (1) year renewal terms unless either party gives written
notice to terminate this Agreement at least ninety (90) days prior to the end
of the preceding term.
3. COMPENSATION.
3.1 Salary: Employer shall pay Employee a base annual salary of
Ten Thousand Dollars ($10,000) per month, payable in
accordance with Employer's normal policies but in no event
less often than biweekly (the "Salary"). Effective January 1
for each successive year this Agreement is in effect,
compensation shall be adjusted by the Board of Directors of
Employer; provided, however, that no adjustment shall be less
than a ten percent (10%) increase of the Salary. The Board of
Directors shall have the right to increase the Salary more
often than annually at its sole discretion.
3.2 Incentive Compensation: Employer shall also pay to Employee incentive
compensation in accordance with Addendum A, Employee Incentive Compensation
Plan, attached hereto and made a part hereof by this reference. Incentive
Compensation shall be paid not less frequently than annually, and prorated as
applicable.
3.3 Management by Objectives (MBO) Bonus: Starting May 1, 2000 and
recommencing each successive calendar year during the Term of this Agreement,
Employee shall participate in an annual MBO Bonus Program designed to incent
the accomplishment, completion and/or delivery of predefined strategic
objectives that support Employer's annual strategic business plan. Prior to
each MBO bonus yielding year, Employee shall present to the Board of
Directors a set of strategic objectives. The Board of Directors shall assign
a specific economic MBO bonus value and payment schedule to each listed
objective and present this to Employee. The Employee will be paid the
appropriate MBO bonus based on performance and accomplishment of the
objectives as determined appropriate by the Board of Directors.
3.4 Stock Purchase Agreement: Employer and Employee entered into that
certain Stock Purchase Agreement dated April 6, 2000, a copy of which is
attached hereto as Addendum E (the "Stock Purchase Agreement").
4. EMPLOYEE BENEFITS.
4.1 General Benefits: Employee shall be entitled to receive or participate
in all benefit plans and programs of Employer currently existing or hereafter
made available to executives or senior management of Employer, including but
not limited to, dental and medical insurance, including coverage for
dependents of Employee, pension and profit sharing plans, 401(k) plans,
incentive savings plans, stock option plans, group life insurance, salary
continuation plans, disability coverage and other fringe benefits.
4.2 Business Expense: Employee shall be provided with American Express
and/or Visa/Master Card credit cards issued in the name of Employer, for
purposes of paying business expenses, including without limitation, business
travel, entertainment, lodging and similar activities. Additionally,
Employee shall be entitled to receive proper reimbursement for all reasonable
out-of-pocket expenses incurred directly by Employee in performing Employee's
duties and obligations under this Agreement. Employer shall reimburse
Employee for such expenses on a monthly basis, upon submission by Employee of
appropriate receipts, vouchers or other documents in accordance with
Employer's policy.
4.3 Automobile Expenses: Employer shall provide Employee with an automobile
allowance in the amount of $750.00 per month, for payment of expenses
relating to Employee's operation and use of an automobile in the course of
performing duties and obligations under this Agreement.
4.4 Cellular Telephone: Employer shall provide Employee with a cellular
telephone for use on Employer's business and Employer shall be responsible
for all costs and expenses incurred in connection with the operation and use
of such cellular telephone, including but not limited to, monthly service
charges and maintenance; provided, however, that Employer shall not be
responsible for costs and expenses incurred for personal use of Employee.
4.5 Assistance: Employer shall furnish Employee with an office, together
with a portable computer and office equipment and such other facilities and
services as are deemed by the Board of Directors of Employer to be suitable
for his position and adequate for the performance of his duties and
obligations under this Agreement. Employer shall also provide Employee with
the necessary communications and computer gear, and related communications
service cost and computer supplies, to support a working home office;
provided, however, that this Section 4.5 shall in no way be construed to
obligate Employer to provide Employee with office furnishings for such
working home office or to reimburse Employee for home office use unless a
separate written agreement is entered into between Employer and Employee.
4.6 Vacation: Employee shall be entitled during each twelve (12) month
period during the Term of this Agreement to a vacation of three (3) weeks
during which time Employee's compensation will be paid in full. Unused days
of vacation will be compensated in accordance with Employer's policy as
established by Employer from time to time. Employee may take the vacation
periods at any time during the year as long as Employee schedules time off as
to not create hardship on Employer. In addition, Employee shall have such
other days off as shall be determined by Employer and shall be entitled to
paid sick leave and paid holidays in accordance with Employer's policy.
5. DUTIES/SERVICES
5.1 Position: Employee is employed as Chief Executive Officer and President
and shall perform such services and duties as are defined in Addendum B, Job
Description, attached hereto, and as are normally associated with such
position, subject to the direction, supervision and rules and regulations of
Employer.
5.2 Place of Employment: The place of Employee's employment and the
performance of Employee's duties will be at Employer's corporate headquarters
and at Employee's home office or at such location as agreed upon by Employer
and Employee.
5.3 Extent of Services: Employee shall at all times and to the best of his
ability perform his duties and obligations under this Agreement in a
reasonable manner consistent with the interests of Employer. The precise
services of the Employee may be extended or curtailed, from time to time at
the discretion of Employer, and Employee agrees to render such different
and/or additional services of a similar nature as may be assigned from time
to time by Employer. However, Employer shall not materially alter Employee's
title, duties, obligations or responsibilities or transfer Employee outside
of the Orange County, California area without Employee's prior written
consent.
5.3.1 Except as otherwise agreed by Employer and Employee in writing, it
is expressly understood and agreed that Employee's employment is fulltime and
of a critical nature to the success of Employer and is therefore exclusive.
Employee may not be employed by other entities or otherwise perform duties
and undertakings on behalf of others or for his own interest unless pre-
approved by Employer's Chief Executive Officer or by the Board of Directors.
Employer acknowledges that Employee presently, or may in the future, serve on
the Board of Directors of other companies and such action shall not be a
breach of this section; provided, however, that such companies either: (a)
are listed on Addendum C, attached hereto; or (b) do not compete with
Employer or interfere with the performance of Employee's duties pursuant to
this Agreement, as determined in the reasonable judgment of the Board of
Directors. Unless otherwise agreed by Employer and Employee in writing,
employment of Employee at less than full time shall not affect the vesting of
the Purchased Shares (as such term is defined in the Stock Purchase
Agreement) pursuant the Stock Purchase Agreement.
5.3.2 Additionally, Employer recognizes that Employee has, or may have in
the future, non-passive equity positions in other companies, which either:
(a) are listed on Addendum C attached hereto; or (b) do not compete with
Employer in the reasonable judgment of the Board of Directors. Employer
recognizes that such equity positions may occasionally require some limited
attention from Employee during normal business hours. However, Employee
agrees that if such time is considered excessive by Employer's Chief
Executive Officer or the Board of Directors, Employee shall be so advised and
noticed by Employer and Employee shall be required to make appropriate
adjustments to ensure his duties and obligations under this Agreement are
fulfilled.
6. TERMINATION. The Term of this Agreement shall end upon its expiration
pursuant to Section 2 hereof, provided that this Agreement shall terminate
prior to such date: (a) upon the Employee's resignation, death or permanent
disability or incapacity; or (b) by Employer at any time for "Cause" (as
defined in Section 6.4 below) or without Cause.
6.1 BY RESIGNATION. If Employee resigns with "Good Reason" (as defined
below), this Agreement shall terminate but: (a) Employee shall continue to
receive, through the end of the Term of this Agreement, Incentive
Compensation in accordance with the terms and conditions of Addendum A and
Employee's Salary payable in periodic installments on Employer's regular
paydays, at the rate then in effect; and (b) all of Employee's "Purchased
Shares" (as such term is defined in the Stock Purchase Agreement) shall be
deemed vested. For purposes of this Agreement, "Good Reason" shall mean: (i)
the assignment to Employee of duties substantially and materially
inconsistent with the position and nature of Employee's employment, the
substantial and material reduction of the duties of Employee which is
inconsistent with the position and nature of Employee's employment, or the
change of Employee's title indicating a substantial and material change in
the position and nature of Employee's employment; (ii) a reduction in
compensation and benefits that would substantially diminish the aggregate
value of Employee's compensation and benefits without Employee's written
consent; (iii) the failure by Employer to obtain from any successor, an
agreement to assume and perform this Agreement; or (iv) a corporate "Change
In Control" (as defined below). For purposes of this Agreement, "Change In
Control" shall mean (1) a merger or consolidation in which securities
possessing more than fifty percent (50%) of the total combined voting power
of Employer's outstanding securities are transferred to a person or persons
different from the persons holding those securities immediately prior to such
transaction in a transaction approved by the stockholders, or the sale,
transfer, or other disposition of more than fifty percent (50%) of the total
combined voting power of Employer's outstanding securities to a person or
persons different from the persons holding those securities immediately prior
to such transaction; or (2) the sale, transfer or other disposition of all or
substantially all of the Employer's assets in complete liquidation or
dissolution of Employer other than in connection with a transaction described
in Section 6.1(1) above. If Employee resigns without Good Reason, Employee
shall be entitled to receive Employee's Salary and Incentive Compensation
only through the date of such resignation and Employee's Purchased Shares
shall be deemed vested only through the date of such resignation.
6.2 BY REASON OF INCAPACITY OR DISABILITY: If Employee becomes so
incapacitated by reason of accident, illness, or other disability that
Employee is unable to carry on substantially all of the normal duties and
obligations of Employee under this Agreement for a continuous period of one-
hundred-eighty (180) days (the "Incapacity Period"), this Agreement shall
terminate but: (a) Employee shall continue to receive, through the end of
the fiscal year, Incentive Compensation in accordance with the terms and
conditions of Addendum A; (b) Employee shall receive, during the Incapacity
Period and for the six (6) month period thereafter (the "Extended Period"),
Employee's Salary payable in periodic installments on Employer's regular
paydays, at the rate then in effect, reduced only by the amount of any
payment(s) received by Employee pursuant to any disability insurance policy
proceeds; and (c) Employee's Purchased Shares shall be deemed vested through
the Extended Period. For purposes of the foregoing, Employee's permanent
disability or incapacity shall be determined in accordance with Employer's
disability insurance policy, if such a policy is then in effect, or if no
such policy is then in effect, such permanent disability or incapacity shall
be determined by Employer's Board of Directors in its good faith judgment
based upon Employee's inability to perform normal and reasonable duties and
obligations.
6.3 BY REASON OF DEATH: If Employee dies during the Term of this Agreement,
Employer shall: (a) pay to the estate of Employee, through the end of the
fiscal year, Employee's Incentive Compensation in accordance with the terms
and conditions of Addendum A; (b) pay to the estate of Employee, for a period
of six (6) months beginning on the date of death (the "Extended Period"),
Employee's Salary payable in periodic installments on Employer's regular
paydays, at the rate then in effect; and (c) Employee's Purchased Shares
shall be deemed vested through the date of the Extended Period. Other death
benefits will be determined in accordance with the terms of Employer's
benefit plans and programs.
6.4 FOR CAUSE. If the Term of this Agreement is terminated by Employer for
Cause: (a) Employee shall be entitled to receive Employee's Salary and
Incentive Compensation only through the date of termination; and (b)
Employee's Purchased Shares shall be deemed vested only through the date of
such termination for Cause. However, if a dispute arises between Employer
and Employee that is not resolved within sixty (60) days and neither party
initiates arbitration proceedings pursuant to Section 11.8, Employer shall
have the option to pay Employee the lump sum of six (6) months base of
Employee's Salary at the time of termination (the "Severance Payment") rather
than Employee's Salary and Incentive Compensation through the date of
termination, and Employee's Purchased Shares shall continue to be deemed
vested through the date of such termination for Cause. Such determination to
pay the Severance Payment in lieu of Employee's Salary and Incentive
Compensation shall be made in the reasonable judgment of the Board of
Directors. If Employer elects to make a payment to Employee of the Severance
Payment, the parties hereto agree that such payment and the payment provided
by Section 6.6 shall be Employee's complete and exclusive remedy for such a
termination for Cause. For purposes of this Agreement, "Cause" shall mean:
(i) any act of dishonesty or fraud with respect to Employer; (ii) the
commission by Employee of a felony, a crime involving moral turpitude or
other act causing material harm to Employer's standing and reputation; (iii)
Employee's continued material failure to perform Employee's duties to
Employer after thirty (30) days' written notice thereof to Employee; or (iv)
gross negligence or willful misconduct by Employee with respect to Employer.
6.5 WITHOUT CAUSE. If, during the Term of this Agreement, Employer
terminates the Employee's employment without Cause: (a) Employee shall be
entitled to receive, through the end of the Term of this Agreement, Incentive
Compensation in accordance with the terms and conditions of Addendum A, and
Employee's Base Salary, payable in periodic installments on Employer's
regular paydays, at the rate then in effect; and (b) all of Employee's
Purchased Shares shall be deemed vested. The payments provided by Sections
6.5 and 6.6 shall be Employee's complete and exclusive remedy for any
termination without Cause.
6.6 EFFECT OF TERMINATION ON UNUSED VACATION TIME: Upon the termination of
this Agreement for any reason whatsoever, Employee shall also have the right
to receive any accrued but unused vacation time, and any benefits vested
under the terms of any applicable benefit plans.
7. NON-DISCLOSURE AND INVENTION AND COPYRIGHT ASSIGNMENT AGREEMENT.
Employee's employment is subject to the requirement that Employee sign,
observe and agree to be bound, both during and after Employee's employment,
by the provisions of Employer's Non-Disclosure and Invention and Copyright
Assignment Agreement, a copy of which is attached hereto as Addendum D.
Employee's execution of the Non-Disclosure and Invention and Copyright
Assignment Agreement is an express condition precedent to Employer's
obligations under this Agreement. Employee further agrees to execute,
deliver and perform, during the Term of Employee's employment with Employer
and thereafter, any other reasonable confidentiality and non-disclosure
agreements concerning Employer and any of its affiliates and its business and
products, which Employer promulgates for other key employees and executives.
8. RETURN OF EMPLOYER PROPERTY: Employee agrees that upon any termination
of his employment, Employee shall return to Employer within a reasonable time
not to exceed two (2) weeks, any of Employer's property in his possession or
under his control, including but not limited to, computer/office automation
equipment, records and names, addresses, and other information with regard to
customers or potential customers of Employer with whom Employee has had
contact or done business.
9. RELATIONSHIP OF PARTIES: The parties intend that this Agreement create
an employee-employer relationship between the parties.
10. NOTICES: All notices, required and demands and other communications
hereunder must be in writing and shall be deemed to have been duly given when
personally delivered or when placed in the United States Mail and forwarded
by Registered or Certified Mail, Return Receipt Requested, postage prepaid,
or when forwarded via reputable overnight carrier, addressed to the party to
whom such notices is being given at the following address:
As to Employer: Knowledge Foundations, Inc.
7852 Colgate Avenue
Westminster, CA 92683
Attn: Chairman of the Board
As to Employee: Michael W. Dochterman
5325 Glickman Avenue
Temple City, CA 91780
Address Change: Any party may change the address(es) at which
notices to it or him, as the case may be, are to be sent by giving
the notice of such change to the other parties in accordance with
this Section 10.
11. MISCELLANEOUS:
11.1 Entire Agreement. This Agreement and the Addendums hereto contain the
entire agreement of the parties. This Agreement may not be altered, amended
or modified except in writing duly executed by the parties.
11.2 Assignment. Neither party, without the written consent of the other
party, can assign this Agreement.
11.3 Binding. This Agreement shall be binding upon and inure to the benefit
of the parties, their personal representative, successors and assigns.
11.4 No Waiver. The waiver of the breach of any covenant or condition herein
shall in no way operate as a continuing or permanent waiver of the same or
similar covenant or condition.
11.5 Severability. If any provision of this Agreement is held to be invalid
or unenforceable for any reason, the remaining provisions will continue in
full force without being impaired or invalidated in any way. The parties
hereto agree to replace any invalid provision with at valid provision which
most closely approximates the intent of the invalid provision.
11.6 Interpretation. This Agreement shall not be construed more strongly
against any party hereto regardless of which party may have been more
responsible for the preparation of Agreement.
11.7 Governing Law This Agreement shall be governed by and construed under
the laws of the State of California, without reference to the choice of law
principles thereof.
11.8 Arbitration.
11.8.1 Any controversy, dispute or claim of whatever nature in any way
arising out of or relating to Employee's employment with Employer, including,
without limitation (except as expressly excluded below in Section 11.8.2) any
claims or disputes by Employee against Employer, or by Employer against
Employee, concerning, arising out of or relating to the separation of that
employment; any other adverse personnel action by Employer; any federal,
state or local law, statute or regulation prohibiting employment
discrimination or harassment; any public policy; any Employer disciplinary
action; any Employer decision regarding a Employer policy or practice,
including but not limited to Employee's compensation or other benefits; and
any other claim for personal, emotional, physical or economic injury
(individually or collectively, "Covered Claims") shall be resolved, at the
request of any party to this Agreement, by final and binding arbitration in
Orange, California before Judicial Arbitration Mediation Services ("JAMS") in
accordance with JAMS' then-current policies and procedures for arbitration of
employment disputes.
11.8.2 The only claims or disputes excluded from binding arbitration under
this Agreement are the following: any claim by Employee for workers'
compensation benefits or for benefits under a Employer plan that provides its
own arbitration procedure; and any claim by either party for equitable
relief, including but not limited to, a temporary restraining order,
preliminary injunction or permanent injunction against the other party.
11.8.3 This agreement to submit all Covered Claims to binding arbitration
in no way alters the exclusivity of Employee's remedy under Section 6.5 in
the event of any termination without Cause or the exclusivity of Employee's
remedy under Section 6.4 in the event of any termination with Cause, and does
not require Employer to provide Employee with any type of progressive
discipline.
11.9 Titles. Titles to the sections of this Agreement are solely for the
convenience of the parties and shall not be used to explain, modify,
simplify, or aid in the interpretation of the provisions of this Agreement.
11.10 Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but together which shall constitute one
and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first written above.
Employer: Knowledge Foundations, Inc.,
a Delaware corporation
By: /s/ Dr. Richard L. Ballard
(signature)
___Dr. Richard L. Ballard _____
(Type/Print name)
____Chairman of the Board_______
(Office held)
Employee:
By: /s/ Michael W. Dochterman
(signature)
___Michael W. Dochterman_______
(Type/Print name)
ADDENDUM A
EMPLOYEE INCENTIVE COMPENSATION PLAN
This Employee Incentive Compensation Agreement (this "Agreement") is entered
into this 1st day of May, 2000, by and between Knowledge Foundations, Inc., a
Delaware corporation (the "Employer"), and Michael W. Dochterman
("Employee"), as follows:
WHEREAS, it is in the best interest of Employer and Employee to enter into a
continuing arrangement to cover annual Employee Incentive bonuses, and
WHEREAS, both parties to this Agreement desire to memorialize various aspects
of their relationship:
NOW, THEREFORE, the parties hereby agree as follows:
1. Addendum. This Agreement is in an addendum to that certain Employment
Agreement effective of even date herewith.
2. Employee Incentive Bonus: Any bonuses granted pursuant to this
Agreement shall be paid annually, within ten (10) days of the completion
of the annual independent audit of Employer. Such bonuses shall be
based upon Employer's "EBITB" (as defined below) and the cumulative
scaled percentage set forth on Schedule 1, attached hereto and made a
part hereof.
3. Definition of EBITB: The term "EBITB" as used herein, shall mean
Employer's net operating profits before taxes, interest and any other
executive bonuses are paid. EBITB shall be determined and certified by
the independent public accountants regularly retained by Employer or its
parent company in accordance with generally accepted accounting
principles and the determination of such independent accountants shall
be final, binding and conclusive on the parties hereto. In making such
determination, all gains or losses realized in the sale or other
distribution of capital assets shall be excluded. Furthermore, any
payment of dividends to shareholders and certain indirect corporate
parent expense items shall also be excluded.
Employer may, from time to time, change, discontinue, sell or undertake
any new operation and may take any and all other steps, which the Board
of Directors of Employer, in its exclusive judgment, shall deem
desirable for Employer. If any such action taken by Employer, or its
Board of Directors, adversely affects the EBITB Employee shall have no
claim or recourse for or by reason of such action.
4. Termination: Termination of employment with Employer, whether voluntary
or involuntary, shall not affect any bonus earned but not paid. If
employment is terminated, a proportionate share of any bonus earned
shall be paid to Employee on the next regular bonus payment date.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first written above.
Employer: Knowledge Foundations, Inc.,
a Delaware corporation
By: _/s/ Dr. Richard L. Ballard
(signature)
___Dr. Richard L. Ballard__ ___
(Type/Print name)
____Chairman of the Board_______
(Office held)
Employee:
By: /s/ Michael W. Dochterman
(signature)
___ Michael W. Dochterman_______
(Type/Print name)
Schedule 1
to Addendum A
Bonus Plan for Michael W. Dochterman
EBITB Marginal % Bracket Bonus
$0 - $500,000 3% Up to $15,000.00
$501,000 - 4% $15,000 plus 4% of
$1,500,000 EBITB over $501,000
$1,500,001 - 5% $55,000 plus 5% of
$2,500,000 EBITB over
$1,500,001
$2,500,001 - 6% $105,000 plus 6% of
$3,500,000 EBITB over
$2,500,001
Over $3,500,000 7% $165,000 plus 7% of
EBITB over
$3,500,000
ADDENDUM B
Job Description for Michael W. Dochterman
Job Title: President & Chief Executive Officer
Department: Executive
Reports To: Board of Directors
SUMMARY
The President serves as Chief Executive Officer ("CEO") and has primary
responsibility for planning, organizing, staffing, and operating the Company
consistent with its core ideology and toward objectives set by the Board of
Directors. The CEO is accountable for all actions, obligations, and
properties of the Company and speaks for the management and staff in all
matters before the Board and the public.
The CEO manages and is accountable for all corporate legal and fiduciary
activities and will provide all plans, applications, reports, and information
required by law or by the Board of Directors.
The CEO articulates the goals and core ideology of the Company, challenges
the Company to fulfill its ambitions, and institutes the organizational
mechanism to grow, sustain, and reward such achievement.
The CEO manages and directs the Company by performing the following duties
personally or through subordinate managers.
ESSENTIAL DUTIES AND RESPONSIBILITIES include the following. Other duties may
be assigned.
Provides and articulates to the Board of Directors the goals, vision,
strategy, policies, budgets, and plans of actions proposed and intended by
KFI's Corporate Management.
Translates corporate goals, plans, and Board directions into policies,
directions, and decisions that guide the daily operation of KFI directly and
through its managers.
Prepares and presents an annual business plan and budget, for the company's
operations, to the Board of Directors.
Determines, directs, and sustains the organization structure, staffing, and
work responsibilities that best meet KFI's business objectives.
Establishes, sustains, and leads by example an organization committed to
excellence, human development, enduring commitment, outstanding service and
achievement.
Recruits, assigns, directs, evaluates, rewards, and judges all others in
their commitments, responsibilities, and performance in advancing KFI's goals
and in creating an environment of relationship, achievement, and
communications conducive to the corporate good.
Holds the corporation to the highest business, professional, legal, and
community standards in its dealings and contributions to the communities for
which and within which it works.
Speaks for Knowledge Foundations Incorporated in all matters, public or
private. Insures that every official representation of the company, its
objectives, dealings, products, and intent are both effective and consistent
with the policies, directives, and intent of the Company and its Board of
Directors.
Collaborates with the Board and company officers to challenge the
organization with long-term plans and bold initiatives that set clear cut
goals and new requirements for pushing the company forward.
Ensures that all Company activities and operations are carried out in
compliance with local, state, and federal regulations and laws governing
business operations.
ORGANIZATIONAL RELATIONSHIPS
Has frequent contact with all department heads and key staff members.
Communicates frequently with major customers and vendors. Represents
Employer in contacts with industry members and community officials and
agencies.
KNOWLEDGE, SKILLS AND EXPERIENCE
Requires high level of planning and organizing skills plus strong
leadership and interpersonal abilities. Must have excellent time
management and communication skills.
ADDENDUM C
Approved Non-Knowledge Foundations
Business Activity Exemptions
Description of Business Activity Employee's Signature
Employer's Signature
ADDENDUM D
EMPLOYEE NONDISCLOSURE AND INVENTION
AND
COPYRIGHT ASSIGNMENT AGREEMENT
In consideration of my employment by KNOWLEDGE FOUNDATIONS, INC. or any
of its subsidiaries and affiliates ("Employer"):
1. I will promptly disclose to Employer in writing all discoveries,
concepts and ideas, whether patentable or unpatentable, including but not
limited to processes, designs, innovations, inventions, formulas, methods,
and techniques, as well as improvements and know-how related thereto, made,
conceived, reduced to practice or learned by me while in Employer's employ,
either solely or jointly with others during my employment ("Employer
Inventions"). This Agreement shall not apply to any Invention developed
entirely on my own time without using Employer's equipment, supplies,
facilities or trade secret information, except for those items and inventions
that either: (i) relate, at the time of conception or reduction to practice
of the invention, to Employer's business or any of the products or services
being developed, manufactured or sold by Employer or which may conveniently
be used in relation therewith, or actual, or demonstrably anticipated
research or development of Employer, or (ii) result from any work performed
by me for Employer.
THIS AGREEMENT DOES NOT APPLY TO ANY INVENTION WHICH QUALIFIES FULLY
UNDER THE PROVISIONS OF CALIFORNIA LABOR CODE SECTION 2870.
(a) I hereby assign to Employer all of my right, title and interest in
and to all such Employer Inventions and to applications for United States
and/or foreign letters patent and to United States and/or foreign letters
patent granted upon such Employer Inventions.
(b) I will acknowledge and deliver promptly to Employer such written
instruments and do such other acts, such as giving testimony in support of my
inventorship as may be necessary in the opinion of Employer to obtain and
maintain United States and/or foreign letters patent and to vest the entire
right and title thereunto in Employer.
(c) I agree that, except for works listed on the attached Schedule 1,
which list the Employer and I may jointly add to from time to time, title to
any and all copyrights, copyright registrations and copyrightable subject
matter which occurs as a result of my employment by Employer shall be the
sole and exclusive property of Employer, and that such works comprise works
made for hire. I hereby assign, and agree to assign, all of said copyrights
to Employer.
(d) I have listed on the attached Schedule 2, all unpatented, but
potentially patentable, ideas and inventions conceived before my employment
with Employer and which are exempt from the obligations of this Agreement.
(e) In the event Employer is unable to secure my signature on any
document necessary to apply for, prosecute, obtain, or enforce any patent,
copyright, or other right of protection relating to any Employer Inventions,
I hereby irrevocably designate and appoint Employer and each of its duly
authorized officers and agents as my agent and attorney-in-fact to act for
and in my behalf and stead 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 and delivered by me.
2. As a direct or indirect consequence of my employment with Employer, I
have been and will/may be exposed to highly sensitive and confidential
information (some of which I may in the past have, or may in the future,
develop or contribute to) not generally, if at all, known or available to
persons or entities not in some way affiliated with Employer and/or
affiliates ("Confidential Information"). Confidential Information shall
include, without limitation, all: (i) information that has or could have
commercial value or other utility in the business in which Employer and its
affiliates are engaged or contemplate engaging in; and (ii) all information
the unauthorized disclosure of which could be detrimental to the interests of
Employer and/or its affiliates, whether or not such information is identified
as Confidential Information by Employer. By example, and without limitation,
Confidential Information includes: financial statements and records,
illustrations, prototypes, models, whether patentable or unpatentable, trade
secrets, know-how, concepts and other data, trademarks, copyrights, design
features, or configurations of any kind, procedures, demonstrations, methods,
processes, uses, manufacturing information, techniques, formulas,
improvements, research and development data, pamphlets, books, reports or
other documents, inspection procedures, apparatuses, compounds, compositions,
combinations, programs, software and works of authorships, whether
discovered, conceived, developed, made or produced, research and development
projects; strategic alliances; confidential information of other entities or
companies with whom Employer or its affiliates may enter into joint ventures,
strategic alliances or other business relationships; the identity of
consultants and assistants; future advertising and marketing methods and
plans; detailed sales and pricing information and formulas; budgets; product
performance; sources of products; production and distribution methods or
procedures; business methods, procedures and plans; licensing arrangements;
customer product preferences and requirements; and, additional information
relating to financial, marketing, technical, developmental and/or other
business aspects, of Employer and/or Employer's affiliates. I agree and
understand that any and all of the foregoing is considered by Employer to be
of a highly confidential nature and as a trade secret. The term
"Confidential Information" shall not include any information obtained by me
through (i) industry publications which are disseminated to or can be
acquired by businesses in the industry, (ii) Dodge Reports and Dun &
Bradstreet and any similar information services, (iii) any Chamber of
Commerce or other trade association reports, or (iv) reports from
governmental agencies. In furtherance of the foregoing, I agree as follows:
(a) To refrain from reproducing or making any summary, extract or
abridgement of, other than in the regular course of business, or removing,
any business record, document, schematic, drawing, instrument, component or
any other item dealing with the Confidential Information without prior
written consent therefor.
(b) To refrain from discussing with any other person or persons,
whether or not said persons are in the employ of Employer, any aspect of the
Confidential Information, except as said discussions directly relate to
completion of the particular task at hand and/or in compliance with
instructions to do so.
(c) To accept and maintain the Confidential Information on a
confidential basis and to protect and safeguard same against unauthorized
publication or disclosure. I will not be justified in disregarding the
obligation of confidentiality by selecting individual pieces of public
information and fitting them together by use of integrated disclosure to
contend that such Confidential Information is in the public domain.
(d) Other than in furtherance of my employment with Employer, not to
use, directly or indirectly, for my own or for my future employer's
advantage, any Confidential Information learned during my employment with
Employer and which is not made publicly known (through no fault of mine).
(e) Not to disclose, publicize, reveal or make available, directly or
indirectly, any of the Confidential Information to any firm, person, or
entity whatsoever, except for a disclosure which is required, if at all, by
statute, order of court or otherwise by law, and then only after first
advising Employer of such demand with reasonably sufficient advance notice,
if possible, so as to afford Employer an opportunity to seek a protective
order.
(f) Upon termination of my employment, to turn over to a designated
individual employed by Employer all property then in my possession, custody
or immediate control belonging to Employer. I will not retain any original,
copy, summary or abridgement of any document which contains Confidential
Information, including correspondence, memoranda, reports, calendars,
contracts, notebooks, drawings, photos or other documents relating in any way
to the affairs of Employer or to the affairs of its affiliated companies and
which are entrusted to me or developed by me at any time during my employment
with Employer, all of which, will be delivered to Employer immediately upon
termination of my employment.
(g) Not to interfere with the relationship between and/or among
Employer and its consultants, agents, employees or others working on research
and development projects or providing services or products to or for
Employer, nor disclose the identity of said individuals and/or entities so
long as not otherwise generally known in the trade.
3. Notwithstanding the definition of "Confidential Information," I
understand that I shall not be liable for disclosure to any third party or
use of any Confidential Information which: (i) at the time of disclosure or
thereafter becomes a part of the public domain through no act or omission by
me; (ii) has been independently generated, discovered or perfected by me and
is listed on the attached Schedule 2; (iii) is subsequently and lawfully
disclosed to me by a third party, which third party did not acquire the
information under an obligation of confidentiality from or through Employer;
or (iv) is required to be disclosed as a matter of law.
4. I acknowledge and agree that the Confidential Information, and the
strict confidentiality thereof, materially affects the successful conduct of
Employer's business and its goodwill; therefore, any breach of the terms of
this Agreement by me is a material breach thereof, and may result in
termination of my employment, the imposition of injunctive relief, and
liability for damages sustained by Employer. In furtherance of the
foregoing, I agree to pay all costs, expenses and attorneys' fees as incurred
by Employer in the enforcement of this Agreement.
5. No modification or waiver of this Agreement or any of its provisions
shall be binding upon Employer unless made in writing and signed on behalf of
Employer by one of its officers (other than me). The invalidity or
unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision and such invalid or
unenforceable provision shall be reformed to the extent possible in order to
give its intended effect and/or meaning. This Agreement shall be governed by
and construed in accordance with the laws of the State of California.
6. This Agreement together with my Employment Agreement with Employer
supersedes any and all agreements between me and Employer with respect to the
subject matter hereof.
7. In the event of any controversy, dispute or claim arising out of or
relating to this Agreement, the Employer and I agree as follows:
(a) I acknowledge and agree that any breach by me of this Agreement,
including but not limited to, disclosure of any information that, at law or
in good conscience or equity, should remain confidential, may give rise to
irreparable injury to Employer which will not be adequately compensable by
damages. Accordingly, Employer may seek and obtain injunctive relief against
the breach or threatened breach of any of the foregoing undertakings, in
addition to all other legal remedies, if any, that may be available. I
acknowledge and expressly agree that the covenants contained herein are
necessary for the protection of the legitimate business interests of Employer
and its affiliates and are reasonable in scope and content, and I hereby
waive, to the maximum extent permitted by applicable law, any requirement
that Employer or any other person post a bond in order to obtain equitable
relief.
(b) Except as otherwise set forth in subparagraph 7(a), all claims,
disputes and other matters in controversy (collectively, "Dispute") arising,
directly or indirectly out of or related to this Agreement, or the breach
thereof, whether contractual or noncontractual, and whether during the term
or after the termination of this Agreement, shall be resolved exclusively
according to the arbitration provisions of Section 11.8 of the Employment
Agreement between me and Employer.
8. The covenants and agreements undertaken herein shall survive termination
of my employment.
I have read and fully understand the foregoing, and by affixing my
signature below, I agree to be fully bound hereby.
Dated: ______________________
Employee:
----------------------------------
Print Name: Michael W. Dochterman
Schedule 1
to Addendum D
Copyrighted And Copyrightable Work Exempt From
This Employee Nondisclosure And Invention
And Copyright Assignment Agreement
Description of Work Employee's Signature Employer's Signature
Schedule 2
to Addendum D
Unpatented But Potentially Patentable
Ideas And Inventions
Conceived Prior To Employment With Employer
Description of Ideas & Inventions Employee's Signature
Employer's Signature
ADDENDUM E
STOCK PURCHASE AGREEMENT
WRITTEN NOTIFICATION TO EMPLOYEE
In accordance with California Labor Code Section 2872, you are hereby
notified that your Employee Nondisclosure and Invention and Copyright
Assignment Agreement does not require you to assign to Employer any invention
which qualifies fully under the provisions of California Labor Code Section
2870.
You are hereby provided a copy of California Labor Code Section 2870.
I hereby acknowledge receipt of this written notification.
Dated: _______________, 2000
Print Name: Michael W. Dochterman ___