Annual Report — Form 10-K
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10-K Annual Report for the Year Ended 1/31/96 51 216K
2: EX-10.07 Employment Agreement, 7/20/95 W/ Edwin R.Addison 8± 43K
3: EX-10.09 Conquest Incentive Stock Option Plan, 8/19/93 5± 27K
4: EX-10.10 Office Lease/Little Patuxent Pkwy, Columbia, Md 31 175K
5: EX-10.11 Office Lease (1959 Palomar Oaks Way, Carlsbad, Ca) 30± 114K
6: EX-10.12 Office Lease (1921 Gallows Rd, Vienna, Va) 9 52K
7: EX-22.01 Subsidiaries of Excalibur Technologies Corporation 1 6K
8: EX-23.01 Consent of Arthur Andersen LLP 1 6K
9: EX-23.02 Consent of Price Waterhouse LLP 1 7K
10: EX-27 Article 5 FDS Filed With Form 10-K 1 8K
EX-10.07 — Employment Agreement, 7/20/95 W/ Edwin R.Addison
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EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, dated as of July __, 1995, between Edwin Addison
(the "Employee") and Excalibur Technologies Corporation, a Delaware corporation,
having its principal office at 9255 Towne Centre Drive, San Diego, CA 92121 (the
"Company").
WHEREAS, Employee presently serves as the Chief Executive Officer of
ConQuest Software, Inc.; and
WHEREAS, the Company's wholly-owned subsidiary, Excalibur Acquisition
Corporation, is entering into an agreement and plan of merger with ConQuest
Software, Inc. (the "Merger"); and
WHEREAS, the Company desires to employ Employee in the position of
Executive Vice President on the terms and conditions set forth herein; and the
Employee is willing to accept and undertake such employment;
WHEREAS, this Agreement supersedes Employee's prior employment agreement
with ConQuest Software, Inc.;
NOW, THEREFORE, in consideration of the foregoing and the provisions
contained herein, Employee and the Company hereby agree as follows:
1. EMPLOYMENT. For a period commencing on the date of consummation of the
Merger and extending until the second anniversary thereof (the "Employment
Period"), the Company will employ Employee and the Employee agrees to and does
hereby accept employment by the Company, as Executive Vice President.
2. DUTIES; FULL-TIME SERVICES.
2.1 DUTIES. Employee's responsibilities and duties shall be those
described in the attached Exhibit A, which duties shall not be materially
altered or diminished during the term of employment without the Employee's
consent. The Employee shall report to the Company's Chief Executive Officer.
2.2 FULL-TIME SERVICES. The Employee agrees that during the
Employment Period he will devote his full time and use his best efforts, ability
and skill to promote and advance the Company's business and interest and to
discharge his duties to the reasonable satisfaction of the Board of Directors of
the Company. During the Employment Period, the Employee will not accept other
gainful employment or become or remain an officer or director of any other
corporation except with the consent of the Board of Directors of the Company.
2.3 LOCATION. The Employee's office shall be located in Columbia,
Maryland. If the Company requires the Employee's relocation, and such relocation
necessitates relocation of the Employee's residence (as reasonably determined by
the Company), the Company shall promptly reimburse to the Employee his costs of
relocation (including, but not limited to, real estate sales commission, moving
costs, and trips incident to locating a new residence) plus an amount equal to
the applicable state or federal income tax payable by the Employee in connection
with such reimbursement.
3. COMPENSATION.
3.1 For all services performed by the Employee for the Company
during the Employment Period, the Employee will be compensated as follows:
(a) SALARY. During the Employment Period, the Company will pay the
Employee an annual salary of $150,000 (the "Base Salary") in equal
semi-monthly installments.
(b) INCENTIVE COMPENSATION. The Employee will receive incentive
compensation during the Company's fiscal year ended January 31, 1996 as
set forth on Schedule A to this Agreement. During the balance of the
Employment Period, Employee will receive incentive compensation pursuant
to an incentive compensation plan which will be similar to the incentive
compensation plans made available to other executive officers of the
Company. The level of Employee's participation and the amount of his
incentive compensation shall be commensurate with Employee's position as
Executive Vice President and his performance during the relevant period.
3.2 OTHER BENEFITS. Employee will be entitled to receive such
health, workmen's compensation, death, disability and other insurance benefits
and to participate in such retirement and other plans, as are made available to
other executive officers of the Company. The level of Employee's participation,
or the amount of his benefits shall be commensurate with benefits made available
to other employees
4. STOCK OPTIONS. Employee shall be granted 40,000 options to purchase
shares of Excalibur Common Stock, of which 26,260 shall be qualified stock
options (within the meaning of Section 422 of the Internal Revenue Code of 1986,
as amended) and 13,740 options shall be non-qualified options to purchase shares
of Excalibur Common stock at an exercise price equal to the average closing
price of Excalibur Common Stock during the ten trading days prior to the closing
of the Merger. These options will vest in equal 12.5% increments every six
months over four years. The Employee will participate in future grants under the
Company's present (and any future) option plan at a level and on terms
comparable to the Company's other senior executives, without regard to the
number of options described within the first sentence of this paragraph.
5. CONFIDENTIALITY.
5.1 As used in this Agreement, "Confidential Information" means
trade secrets and any other proprietary or confidential information that derives
independent economic value to the Company or its affiliates from not being
generally known to the public or to other persons who can obtain economic value
from its disclosure or use and that is the subject of efforts by the Company
that are reasonable under the circumstances to maintain its secrecy including,
without limitation, information with respect to marketing, sales, client and
supplier list, corporate planning and financial projections. Confidential
Information may include, but not be limited to, inventions, disclosures,
processes, systems, know-how, methods, techniques, drawings, applications,
solutions, materials, devices, research activities and plans, scientific data,
specifications, costs of production, prices, promotional methods, financial
information, marketing plans or customer and supplier information. The Employee
agrees that any Confidential Information which Employee may acquire in the
course of employment with the Company, shall be regarded as held by him in a
fiduciary capacity, solely for the benefit of the Company, and shall not at any
time, either during the term of this Agreement or thereafter, be disclosed,
divulged, furnished or made available to any third party or be otherwise used by
Employee other than in the regular course of business of the Company.
Information or collections of information shall be considered covered by the
preceding sentence if not known by the public generally, even though portions of
such information may be publicly available or may be available to certain third
parties pursuant to arrangements with the Company.
5.2 Upon termination of his employment with the Company, the
Employee will deliver to the Company all writings relating to or containing
Confidential Information, including without limitation, notes, memoranda,
letters, drawings, diagrams, printouts, computer tapes, computer disks, and any
other form of recorded information.
5.3 As a means reasonably calculated to prevent Employee from
disclosing any Confidential Information concerning the Company acquired by
Employee or used during the term of this employment, which would cause the
Company to be injured, because disclosure or use of such information is
difficult to detect and establish, and in recognition of Employee's critical and
unique role in the Company, Employee agrees that, during the term of his
employment by the Company, and for two years thereafter, he will not knowingly
(i) on behalf of any person or any entity other than the Company employ, retain,
or solicit for employment or retention any person who is at the time, an
employee of the Company or any affiliated or subsidiary of the Company in an
executive, creative, managerial, technical, marketing or sales capacity, or
cause or assist any other person or entity to do the same, (ii) directly or
indirectly solicit or contact, or cause, encourage or assist any other person or
entity to solicit or contact, any client of the Company, for the purpose of
competing with the Company in any way, or (iii) divert or attempt to divert, or
cause, encourage or assist any other person or entity to divert any business or
business opportunity of the Company of which the Employee became aware in
connection with his employment by the Company.
6. DEVELOPMENTS. Employee agrees promptly to disclose to the Company all
inventions, improvements, enhancements, discoveries and developments, which are
within the scope of the Company's products currently marketed or under
development during the Employment Period and which are made, developed or
conceived by him, either solely or jointly with others, during the Employment
Period. All such inventions, improvements, enhancements, discoveries and
developments shall become and remain the property of the Company, whether or not
patent or copyright applications have been filed thereon or with respect
thereto, and the Employee in consideration for the execution of this Agreement,
and his employment by the Company, hereby sells, assigns and transfers to the
Company all right, title and interest in and to such inventions, improvements,
enhancements, discoveries and developments, and further agrees that he will
cooperate fully and unconditionally in all reasonable requests by the Company in
furtherance of protecting, developing or exploiting commercially any inventions,
improvements, enhancements, discoveries and developments disclosed pursuant to
this Section 6. Further, Employee agrees that he will promptly execute all
necessary documents request of him by the Company incidental to any patent or
copyright application, assignments, powers of attorneys and all other documents
and do such other things as, in the opinion of counsel for the Company, may be
necessary or useful for the full enjoyment thereof throughout the world by the
Company and its designees.
7. REMEDIES. Employee acknowledges that any breach of any of the covenants
contained in Section 5 or Section 6 hereof may cause damage to the Company not
readily susceptible to measurement in economic terms or for which economic
compensation may be inadequate. Accordingly, in addition to any other remedy
provided at law or in equity, Employee agrees that the Company shall be entitled
to temporary, preliminary and/or permanent injunctive relief restraining
Executive from any actual or threatened violation of the covenants contained in
Section 5 or 6 (without any bond or security being required).
8. TERMINATION OF EMPLOYMENT. Employee's employment by the
Company may be terminated in the manner, for the reasons and with the
consequences provided for in this Section 8.
(a) Employee's employment hereunder may be terminated by the Company
effective at the end of the Employment Period without any additional
payment being due to Employee, provided that the Company shall remain
liable to pay the Employee the full amount of his salary and bonus and any
other amounts otherwise payable to him by the Company, which amounts are
attributable to any period prior to such termination.
(b) In the event that Employee shall be disabled through illness or
accident in performing his duties hereunder for a period in excess of six
months, the Company shall have the option, upon giving of not less than 30
days' written notice thereof, exercisable only so long as such disability
shall continue, to terminate Employee's employment under this Agreement.
In the event that Employee's employment is so terminated, or the Employee
dies during the term of this Agreement, the Company will pay to the
Employee or his Estate, as the case may be an amount equal to the amount
of the remaining salary payments due to Employee for the remainder of the
Employment Period as set forth in Section 3.1. The Employee or his Estate
shall be paid the foregoing amounts periodically, as though he were still
on the Company's payroll. In addition, the Company will pay Employee or
his Estate the share of any incentive compensation to which Employee would
be entitled pro rated for the period of time during which Employee
actually was employed. Finally, the Company will provide Employee (if he
is disabled) with life and health insurance and such other similar
benefits as Employee is receiving upon the date of discharge for the
remaining term of the Employment Period.
(c) Unless previously terminated pursuant to the provisions of
subdivision (a) or (b) of this Section 8, Employee's employment hereunder
may be terminated without any additional payment being due to Employee, if
(i) Employee shall have materially violated any of the provisions of this
Agreement and shall have continued to do so after receipt of written
notice thereof from the Company and reasonable opportunity to cure to the
extent that such breach is susceptible to complete cure or (ii) Employee
shall have engaged in any action during Employee's employment hereunder
involving willful malfeasance or gross negligence or shall have given aid
to a competitor of the Company which reasonably could be expected to be
detrimental to the Company.
Notwithstanding anything contained herein to the contrary, the Company
shall remain liable for the full amount of his salary and bonus and any
other amounts otherwise payable to him by the Company, which amounts are
attributable to any period prior to termination under this Section 8(c).
(d) The Employee and the Company expressly agree that nothing in
this Agreement shall prohibit the Company from discharging the Employee
for any reason. If the Company discharges the Employee for any reason
other than is set forth in Sections 8(a), (b) or (c) above, the Company
will pay to the Employee the remaining salary payments due the Employee
for the Employment Period. The Employee shall be paid the foregoing amount
periodically as though he were still on the Company's payroll. In
addition, the Company will pay Employee the share of any incentive
compensation to which Employee would be entitled as an employee had he
been employed through the Employment Period.
9. NON-SOLICITATION: NON-COMPETITION.
Whereas, this Agreement is being executed in connection with the
Agreement and Plan of Merger pursuant to which ConQuest Software, Inc. is being
merged into a wholly-owned subsidiary of the Company pursuant to which all of
Employees shares in ConQuest are being acquired in exchange for shares of the
Company's Common Stock, Employee has agreed to the following provisions:
9.1 NON-SOLICITATION. In addition to the limitations contained in
Section 2, the Employee agrees that during the term of this Agreement, and for a
term of two years after termination of this Agreement, that he will not directly
or indirectly solicit for employment any person employed by the Company or, at
the end of the Employment Period, any person being recruited by the Company. In
the event of breach of this covenant not to compete, the parties acknowledge
that the Company may be irreparably damaged and may not have an adequate remedy
at law. The Company may therefore obtain injunctive relief, without the
necessity of posting a bond, for any breach or threatened breach of this
covenant.
9.2 NON-COMPETITION. Employee agrees that during the term of this
Agreement and for a period of two years after termination of his employment with
the Company he will not compete, directly or indirectly, with the Company in
fields of business in which the Company is engaged as of the date of the
termination of his employment. For purposes of this Section 9.2 direct
competition means designing, developing, producing or selling products
competitive with those of the Company's products being marketed or under
development during the term of this Agreement or providing assistance to any
person or entity engaged in any such activity. Indirect competition means
accepting employment, with the department, division, or other business unit of a
third party which department, division or business unit produces products
competitive with the Company's products marketed or under development during the
term of this Agreement. Notwithstanding the foregoing, it shall be deemed a
violation of this Section 9.2 if the Employee accepts employment during the two
year period following the termination of this Agreement with any of the
following:
Fulcrum Technologies, Inc.
Verity
Personal Librarian Systems
Dataware
IDI
Microsoft
23158/1111/JD/230341.1
Oracle
10. DILUTION PROTECTION. The following section from the Employee's
previous employment agreement with ConQuest Software, Inc. shall not be
effective until this Dilution Protection Section is explicitly approved by
shareholders holding a majority of the Company's outstanding Common Stock as
part of a stockholder vote:
The Company retains the right to dilute its equity for the purposes of
raising capital. Such dilution is intended at add value to the corporation.
Whenever dilution takes place, all existing shares will be diluted equally with
respect to the current base of 1.8 million shares, subject to the following
exceptions: a. The board of directors may allocate up to 2% additional for use
in incentives. b. Directors and officers are permitted to be distributed
warrants uniformly in proportion to their equity in the event of a merger,
acquisition, public offering, or major sale of equity in the event of a merger,
acquisition public offering, or major sale of equity. Such warrants must be at
prices at or above the then current stock price and are used as incentives for
future performance, c. If shares are sold at a price less than any unexercised
option price, such option price will be either adjusted downward to the sale
price, or the number of shares which can be purchased at the aggregate option
amount will be adjusted upward to reflect such price.
11. ABILITY TO PERFORM. The Employee hereby represents and warrants to the
Company that he is under no legal disability and has entered into no agreements
which in any way limit or render the Employee incapable of performing his
obligations under this Agreement or his fiduciary duties as the Executive Vice
President of the Company. The Employee further covenants that he will not impair
his ability to carry out his obligations under this Agreement or his fiduciary
duties as Executive Vice President of the Company by entering into any agreement
or in any way assisting others, directly or indirectly, to enter into any
agreement which will violate the nondisclosure, noncompetition and
confidentiality provisions of this Agreement.
12. SURVIVAL OF OBLIGATIONS. The covenants and agreements set forth in
this Agreement shall survive any termination of this Agreement and remain in
full force and effect regardless of the cause of the termination to the full
extent necessary to protect the interest of the party in whose favor they run.
13. ASSIGNABILITY OF AGREEMENT.
13.1 BY EMPLOYEE. Except as otherwise provided in this Agreement,
the Employee shall not be entitled to assign (voluntarily or involuntarily, by
operation of law or otherwise) any of his rights under this Agreement, nor
delegate any of his duties or obligations under this Agreement, without the
prior written consent of the Company.
13.2 BY THE COMPANY. The benefits hereunder with respect to the
rights of the Company to the services of the Employee may be assigned by the
Company to any other Company or other business entity which succeeds to all or
substantially all of the business of the Company through merger, consolidation,
corporate reorganization or by acquisition of all or substantially all of the
assets of the Company or to a company controlled by it, or controlling it, or
under common control with it; provided, however, that the obligations and
liabilities of the Company under this Agreement shall be binding upon any such
successors in interest or transferees.
14. NOTICES. All notices, consents, waivers or demands of any kind
which either party to this Agreement may be required or may desire to serve
on the other party in connection with this Agreement, shall be in writing and
may be delivered by personal service or sent by facsimile or sent by
registered or certified mail, return receipt requested, with postage thereon
fully prepaid. All such communications shall be addressed as follows:
Corporation: Excalibur Technologies
Corporation
9255 Towne Centre Drive
San Diego, California 92121
with copies to: Jay H. Diamond
Holtzmann, Wise & Shepard
1271 Sixth Avenue
45th Floor
New York, New York 10020
Employee Edwin Addison
8395 Scarlett Glenn Court
Millersville, MD 21108
If sent by facsimile, a confirmed copy of such facsimile notice
shall promptly be sent by mail (in the manner provided above) to the addresses.
Service of any such communication made only by mail shall be deemed complete on
the date of actual delivery as shown by the addressee's registry or
certification receipt or at the expiration of the third (3rd) business day after
the date of mailing, whichever is earlier in time. Either party thereto may from
time to time, by notice in writing served upon the other as aforesaid, designate
a different mailing address or a different person to which such notices or
demands are thereafter to be addressed or delivered. Nothing contained in this
Agreement shall excuse either party from giving oral notice to the other when
prompt notification is appropriate, but any oral notice given shall not satisfy
the requirement of written notice as provided in this Section.
15. SUPERSEDES OTHER AGREEMENTS. This Agreement supersedes and
replaces all prior negotiations, proposed agreements and agreements, written
or oral.
16. GOVERNING LAW. This Agreement shall be interpreted and enforced
according to the laws of the State of Delaware (regardless of that
jurisdiction's or any other jurisdiction's choice of law principles).
17. SEVERABILITY. If any provision of this Agreement is or becomes or is
deemed invalid, illegal, or unenforceable in any jurisdiction, (a) such
provision will be deemed amended to conform to applicable laws of such
jurisdiction so as to be valid and enforceable, or, if it cannot be so amended
without materially altering the intention of the parties, it will be stricken,
(b) the validity, legality and enforceability of such provision will not in any
way be affected or impaired thereby in any other jurisdiction, (c) the remainder
of this Agreement will remain in full force and effect.
18. COUNTERPARTS. This Agreement may be executed in two original
counterparts. Both counterparts shall constitute one and the same Agreement
19. ARBITRATION. Except for any claim or dispute which gives rise or could
give rise to equitable relief under this Agreement, any disagreement, dispute or
controversy arising under this Agreement shall be settled exclusively and
finally by arbitration. The arbitration shall be conducted in accordance with
the Commercial Arbitration Rules of the American Arbitration Association (the
"AAA Rules") in Baltimore, Maryland or in such other city as the parities to the
dispute may designate by mutual consent. The arbitration tribunal shall consist
of three arbitrators (or such lesser number as may be agreed upon by the
parties) selected according to the procedure set forth in the AAA Rules in
effect on the date hereof. The chairman of the arbitration tribunal shall be
appointed by the American Arbitration Association from among the three
arbitrators so selected. The fees and expenses of the arbitration tribunal
incurred in connection with such arbitration shall be borne equally by the
parties to the arbitration or otherwise as the arbitrators may determine.
-2-
23158/1111/JD/230341.1
IN WITNESS WHEREOF, the parties hereto have entered into the above
Agreement as of the day and year first above written.
[Edwin Addison]
EXCALIBUR TECHNOLOGIES
CORPORATION
By:
Name:
Title:
-3-
23158/1111/JD/230341.1
EXHIBIT A
. General management of Federal Government business of Excalibur
. General Management of the On-line (I.E., content providers)
business of Excalibur
. Director to the corporation
. Negotiate/maintain select strategic relationships
. Provide significant input to product/market strategy and business
vision
. Provide leadership/energy in establishing new business
initiatives as appropriate
. Communicate the company's vision to employees and customers
* General Management includes all aspects of management of a business unit
including revenue, delivery, net contribution, customer satisfaction.
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SCHEDULE A
The Employee is eligible to earn incentive compensation for the fiscal
year ended January 31, 1996 in an aggregate amount equal to 55% of the Base
Salary payable to the Employee during such period. Payment of incentive
compensation shall be determined as follows:
40% of the amount payable shall be paid quarterly (up to 10% for each
quarter) in the event that the Company earns revenue equal or
greater than the amount budgeted during each quarter; and
40% of the amount payable shall be paid quarterly (up to 20% for each
quarter) in the event that the Company achieves profitability in the
third and/or fourth quarter;
20% shall be payable in the discretion of the Compensation Committee of
the Board of Directors
Dates Referenced Herein and Documents Incorporated by Reference
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