Employment Agreement - ActiveTouch Inc. and Min Zhu
EMPLOYMENT AGREEMENT
This Employment Agreement (hereinafter "Agreement") is entered into between
ActiveTouch, Inc. (hereinafter "Employer") and MIN ZHU (hereinafter "Employee"),
effective August 14, 1998 ("Effective Date").
WHEREAS, Vanenburg Ventures B.V. ("VV") intends to exercise its Warrant to
purchase Series B preferred stock of Employer;
WHEREAS, in consideration of the additional investment that VV will be making in
Employer, VV desires that Employer's key employees enter into an employment
agreement with Employer;
Now therefore, in consideration of the foregoing, the parties agree as follows:
1. EMPLOYMENT, COMPLETE AGREEMENT AND MODIFICATION
Employer agrees to continue to employ Employee and Employee agrees to be
employed by Employer on the terms and conditions set forth herein. This
Agreement supersedes previous correspondence, promises, representations and
agreements, if any, either written or oral, provided however that the Employee
Proprietary Information and Inventions Agreement that Employee signed on March
12, 1998, remains in full force and effect to the extent that it does not
conflict with the provisions of this Agreement. No provision of this Agreement
may be modified except by a writing signed by both Employer and Employee.
2. DUTIES AND COMPENSATION
Employee's title is President and CTO. Employee shall perform any and all duties
now and hereafter assigned by Employer for a salary as may be from time to time
fixed by Employer. Employee agrees to abide by Employer's rules, regulations and
practices, including those concerning work schedules, vacation and sick leave,
as they may be from time to time adopted or modified. Employee's title shall
only be changed by mutual agreement.
3. SALARY MAY BE CHANGED
Employee's salary is $15,000 per month. Employer and Employee understand and
agree that his salary may be adjusted from time to time consistent with local
market practice and the needs of the business.
4. TERM OF EMPLOYMENT
Employee agrees to work for Employer for a two (2) year term from the Effective
Date of this Agreement, subject to the conditions set forth in section 5 of this
Agreement.
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5. TERMINATION OF EMPLOYMENT
(a) Employee's employment with Employer shall continue as long as it is mutually
agreeable between Employer and Employee; provided, however, that if Employee
is terminated by Employer prior to August 14, 2000, for reasons other than
"Cause", Employee will be paid a separation package consisting of the base
monthly salary, medical benefits and benefits under a 401K plan that he
would have received for the balance of the term of this Agreement. The
salary shall be paid on Employer's regularly scheduled paydays and shall be
subject to regular payroll deductions. Employee shall not be entitled to any
other separation benefits. As a condition of receiving the separation
package set forth in this section 5(a), Employee shall be required to
execute a release, in a form satisfactory to Employer, of any and all claims
Employee may have against Employer, its officers, directors, employees or
agents, arising out of or related to his employment with Employer.
(b) "Cause" includes but is not limited to failure to perform the job; failure
to achieve performance levels for Employer consistent with Employer's goals,
as determined by the Board of Directors; violation of Employer policy;
insubordination; failure of Employee to devote his full time and energy to
Employer's business; failure of Employee to protect Employer's proprietary
and confidential information; or, other conduct which, in the judgment of
the Board of Directors, in inconsistent with the performance of the job a
satisfactory level of competence.
6. OTHER COMPENSATION
Employee understands and agrees that any additional compensation to Employee
shall rest in the Employer's sole discretion and that Employee shall not earn or
accrue any right to additional compensation by virtue of his employment.
7. EMPLOYEE BENEFITS PLAN
Employer may adopt or continue in force benefits plans for the benefit of
employees. Employer may terminate any or all such plans at any time and choose
not to adopt additional plans. Employee's rights under any benefit plans now in
force or later adopted shall be governed solely by their terms.
8. DUTY TO DEVOTE FULL TIME AND TO AVOID CONFLICT OF INTEREST
Employee agrees that during the period of employment, he shall devote full time
efforts to his duties as an employee of Employer. During the period of
employment, Employee agrees not to (i) solely or jointly with others undertake
any business activity that competes with Employer's business, and (ii) directly
or indirectly, engage or participate in any other activities in conflict with
the best interests of Employer.
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9. INFORMATION DISCLOSED REMAINS PROPERTY OF EMPLOYER
All ideas, concepts, information, and written material disclosed to Employee by
Employer, or acquired form a customer or prospective customer of Employer, are
and shall remain the sole and exclusive property and proprietary information of
Employer or such customers, and are disclosed in confidence by Employer or
permitted to be acquired from such customers in reliance on Employer's agreement
to maintain them in confidence and not to use or disclose them to any other
person except in furtherance of Employer's business.
10. INVENTIONS BELONG TO EMPLOYER
(a) Any and all inventions, discoveries, improvements or creations
(collectively, the "Invention Ideas") which Employee has conceived or made,
or may conceive or make during the period of employment in any way, directly
or indirectly, connected with Employer's business, shall be the sole and
exclusive property of Employer. The term "Inventions Ideas" means any and
all ideas, processes, trademarks, service makes, inventions, technology,
computer programs, original works of authorship, designs, formulas, patents,
discoveries, copyrights and all improvements, rights, and claims related to
the foregoing that are conceived, developed or reduced to practice by
Employee alone or with others, except to the extent California Labor Code
Section 2870 lawfully prohibits the assignment of rights in such ideas,
processes, inventions, etc. Employee agrees that all patentable and
copyrightable works created by Employee or under Employer's direction, in
connection with Employer's business are "works made for hire" and Employee
hereby assigns all proprietary rights, including patent and copyright, in
these works to Employer without further compensation.
(b) Employee further agrees to (i) disclose promptly to Employer all such
Invention Ideas which Employee has made or may make solely, jointly or
commonly with others, (ii) assign all such Invention Ideas to Employer, and
(iii) execute and sign any and all applications, assignments or other
instruments which Employer may deem necessary in order to enable it, at its
expense, to apply for, prosecute, and obtain patents, copyrights, or other
proprietary rights in the United States and foreign countries, or in order
to transfer to Employer all right, title and interest in said Invention
Ideas.
(c) This Agreement does not apply to inventions which qualify fully for
protection under Section 2870 of the California Labor Code ("Section 2870").
Currently, Section 2870 applies to inventions for which no equipment,
supplies, facility or trade secret information of Employer was used and
which was developed entirely in Employee's own time, and (i) which does not
relate, at the time of conception or reduction to practice of the invention,
to the business of Employer, or to Employer's actual or demonstrably
anticipated research or development, or (ii) which does not result from any
work performed by Employee for Employer. Notwithstanding this section 10(c),
during the term of Employee's employment, Employee shall disclose in
confidence to Employer any invention in order to permit Employer to make a
determination as compliance by Employee with the terms and conditions of
this Agreement. Employee
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understands that he bears the full burden of proving to Employer that
the invention qualifies fully under Section 2870.
11. CONFIDENTIALITY
(a) Definition. During the term of employment with Employer, Employee will have
access to and become acquainted with the various trade secrets and other
proprietary and confidential information owned by Employer and used by
Employer in its business. "Trade secrets and other proprietary and
confidential information" consist of, for example and not intending to be
exclusive, (i) software (source and object code), algorithms, computer
processing systems, techniques, methodologies, formulae, processes,
compilations of information, drawings, proposals, job notes, reports,
records, and specifications, and (ii) information concerning any matters
relating to the business of Employer, any of its customers, customer
contacts, licenses, the prices it obtains or has obtained for the licensing
of its software products and services, or any other information concerning
the business of the Employer and Employer's good will.
(b) No Disclosure. Employee shall not disclose or use in any manner, directly or
indirectly, any such trade secrets and other proprietary and confidential
information either during the term of this Agreement or at any time
thereafter, except as required in the course of employment with Employer.
(c) No Engaging in Unfair Competition. By signing this Agreement, Employee
acknowledges and agrees that the names, addresses and product specifications
of Employer's customers constitute "trade secrets and other proprietary and
confidential information" and that the sale or unauthorized use or
disclosure of this or any other trade secrets and other proprietary and
confidential information" that Employee obtained during the course of this
Agreement would constitute unfair competition with Employer. Employee
promises not to engage in any unfair competition with Employee either during
the terms of Employee's employment or at any time thereafter.
12. RETURN OF MATERIAL
Employee agrees that, upon Employer's request or termination of employment, he
shall turn over to Employer all documents, disks or other computer media, or
other material in his possession or under his control, that (i) may contain or
be derived from concepts, Invention Ideas, or trade secrets and other
proprietary and confidential information as set forth in paragraphs 9, 10 and 11
above, or (ii) are connected with or derived from Employee's services to
Employer.
13. INDUCING EMPLOYEES TO LEAVE EMPLOYER; EMPLOYMENT OF EMPLOYEES
Any attempt on the part of Employee to induce others to leave Employer's employ,
or any effort by Employee to interfere with Employer's relationship with its
other employees, could be harmful and damaging to Employer. Employee agrees that
during
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the term of employment and for a period of one year thereafter, Employee will
not directly or indirectly (i) induce or attempt to induce any employee of
Employer to quit employment with Employer; (ii) otherwise interfere with or
disrupt Employer's relationship with its employers; or (iii) solicit or entice
away any Employee of Employer.
14. NONSOLICITATION OF BUSINESS
For a period of one year from the date of termination of employment, Employee
will not divert or attempt to divert from Employer any business Employer has
enjoyed or solicited from its customers during the two (2) years prior to
termination of his employment.
15. REMEDIES--INJUNCTION
In the event of a breach or threatened breach by Employee of the provisions of
sections 8 through 14 of this Agreement, Employee agrees that Employer--in
addition to and not in limitation of any other rights, remedies or damages
available to Employer at law or in equity--shall be entitled to a permanent
injunction to prevent or restrain any such breach by Employee or by Employee's
partners, agents, representatives, servants, employees and/or any and all
persons directly or indirectly acting for or with Employee.
16. SEVERABILITY
If any of the provisions of this Agreement is held to be invalid or
unenforceable in whole or in part, those provisions to the extent enforceable
and all other provisions shall nevertheless continue to be valid and enforceable
as if the invalid or unenforceable parts had not been included in this
Agreement. If any provision relating to the time period or scope of a
restriction shall be declared by a court of competent jurisdiction to exceed the
maximum time period or scope such court deems reasonable and enforceable, then
the time period or scope or the restriction which is deemed reasonable and
enforceable by the court shall become and shall thereafter be the maximum time
period or the applicable scope of the restriction. To the extent that any
provision in this Agreement conflicts with one or more provisions of the
Employee Proprietary Information and Inventions Agreement dated March 12, 1998,
the latter shall prevail.
17. GOVERNING LAW
This Agreement shall be construed and enforced according to the laws of the
State of California. All legal actions arising under this Agreement shall be
instituted in, and both Employer and Employee consent to jurisdiction in
California.
18. AGREEMENT READ, UNDERSTOOD AND FAIR
Employee has carefully read and considered all provisions of this Agreement and
agrees that all restrictions set forth are fair and reasonably required for the
protection of the interests of Employer.
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AGREED:
EMPLOYER:
ACTIVETOUCH INC.
/s/ Klaas De Boer /s/ Subrah S. Iyar
----------------------------------- ------------------------------------
By: Klaas De Boer Subrah S. Iyar
Title: Director CEO
Date: 14 Aug 1998 14 Aug. 1998
EMPLOYEE:
/s/ Min Zhu
-----------------------------------
By: Min Zhu
Date: 8/14/98
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