California Software Corporation
2901 S. Pullman Street
Santa Ana, California 92705
Employment Agreement
This Employment Agreement (the "Agreement"), entered
into this 13th day of December, 1999, by and between
California Software Corporation (the "Company"), having an
office at 2901 S. Pullman Street, Santa Ana, California
92705 and Bruce Acacio, (the "Employee"), whose mailing
address is 25 Glen Echo, Dove Canyon, CA 92679.
RECITALS
WHEREAS, The Employee is one of the key executives of
the Company and has experience in the area of business of
which the Company is involved; and
WHEREAS, The Company wishes to employ the Employee as
President, Chief Executive Officer and Chairman of the Board
and the Employee wishes to provide these officer services to
the Company.
NOW, THEREFORE, in consideration of the recitals, the
following representations and covenants and the payment of
one dollar made by each party to the other, the receipt and
sufficiency of which is acknowledged by each party, the
parties agree on the following terms:
1. ENGAGEMENT AND DURATION
1.1 The Company hereby engages the services of the Employee
for the position of President, Chief Executive Officer and
Chairman of the Board and the Employee hereby accepts such
engagement and agrees to perform the services to the best of
his ability and in accordance with terms and conditions of
this Agreement.
1.2 The Company shall employ the Employee for a term of
three (3) years commencing on the date as set above. This
initial term can be extended at the sole option of the
Company.
2. DUTIES
2.1 The Employee shall, pursuant to this Agreement, perform
all duties customarily performed by an Employee with like
title and position of a publicly-held corporation engaged in
a business similar to the Company's business.
2.2 The Employee shall use his or her best efforts to
promote the interests of the Company and, to the extent
necessary to discharge the responsibilities assigned to the
Employee, perform faithfully and efficiently such
responsibilities.
2.3 The Employee shall perform his duties at the offices of
the Company which are currently located at 2901 S. Pullman,
Santa Ana, California 92705, or at such other location as
shall be approved by the board of directors.
2.4 The Employee will, subject to the terms of this
agreement, comply promptly and faithfully with the Company's
reasonable instructions, directions, requests, rules and
regulations as may be expected of a part-time Employee. The
Company shall not be deemed to have waived the right to
require the Employee to perform any duties hereunder by
assigning the Employee to any other duties or services or by
assigning another individual to perform the duties of the
Employee.
2.5 The Employee's performance of personal, civil, or
charitable activities or the Employee's service on any
boards or committees as of the date of this Agreement or at
any future time during the term of this Agreement shall not
be deemed to interfere with the performance of the
Employee's services and responsibilities to the Company
pursuant to this Agreement.
2.6 In the event of a change of control of the Company, the
Employee shall continue to serve the Company in the same
capacity and have the same authority, responsibilities and
status as he had as of the date immediately prior to the
change of control. Following a change of control, the
Employee's services shall be performed at such location as
may be mutually agreed upon between the Company and the
Employee. For the purposes of this Agreement, a "change of
control" shall be deemed to have occurred when:
(a) a person other than the current control person(s) of
the Company becomes a control person; or
(b) a majority of the directors elected at any annual or
special meeting of the Shareholders of the Company are not
individuals nominated by the Company's then-incumbent Board
of Directors.
3. REMUNERATION AND BENEFITS
3.1 Base Salary. The Employee shall be paid an annual base
salary of TWO HUNDRED TWENTY-FIVE THOUSAND DOLLARS
($225,000.00) (U.S.D.) for the first year of employment
under this Agreement, beginning January 1, 2000. The
Employee shall be paid an annual base salary of THREE
HUNDRED THOUSAND DOLLARS ($300,000.00) (U.S.D.) for the
second year of employment under this Agreement, beginning
January 1, 2001. The Employee shall be paid an annual base
salary of THREE HUNDRED FIFTY THOUSAND DOLLARS ($350,000.00)
(U.S.D.) for the third year of employment under this
Agreement, beginning January 1, 2002.
3.2 Quarterly Bonuses. During the term of the Agreement,
quarterly bonuses shall be paid to the Employee by the
Company, in the amount of TWENTY-FIVE THOUSAND DOLLARS
($25,000) (U.S.D) per quarter based upon a percentage of
achievement of the revenue goals as set forth by the board
of directors of the Company in the Company's annual
projections.
3.3 Stock Options. At the end of the first year of the
term of this Agreement (December 31, 2000), the Company
shall grant to Employee options to purchase THREE HUNDRED
THOUSAND (300,000) shares of common stock of the
Company, exercisable at the end of the initial term of the
Agreement. At the end of the second year of the term of
this Agreement (December 31, 2001), the Company shall grant
to Employee options to purchase THREE HUNDRED THOUSAND
(300,000) shares of common stock of the Company, exercisable
at the end of the initial term of the Agreement. At the end
of the third year of the term of this Agreement (December
31, 2002), the Company shall grant to Employee options to
purchase THREE HUNDRED THOUSAND (300,000) shares of
common stock of the Company, exercisable at the end of the
initial term of the Agreement.
3.4 Reimbursement of Expenses. The Company shall reimburse
the Employee for all reasonable expenses incurred by the
Employee in the performance of his duties pursuant to this
agreement upon the Employee providing the Company with
receipts for such expenses. Such reimbursable expenses
shall not include customary day-to-day office expenses,
including but not limited to copies, faxes, and office
supplies.
4. RESTRICTIVE COVENANTS
4.1 Non-Competition
4.1.1 During the term of this Agreement, the Employee
shall not:
(a) own or have any interest directly in;
(b) act as an officer, director, agent, Employee or
consultant of; or
(c) assist in any way or in any capacity, any person,
firm, association, partnership, corporation or other
entity which is,
a business that is substantially similar to and/or competes
with the business then engaged in by the Company (the
"Competitive Entity").
4.1.2 The restriction set out in subparagraph 4.1.1(a)
above shall not apply to the Employee's ownership of less
than ten (10%) of the securities of any Competitive Entity.
4.1.3 The Employee acknowledges that the restrictions
contained in this section 4.1 are reasonable; however, in
the event that any court should determine that any of the
restrictive covenants contained in subparagraph 4.1.1 or
4.1.2 of this agreement, or any part thereof, are
unenforceable because of the duration of such provision or
the area covered thereby, such court shall have the power to
reduce the duration or area of such provision and, in its
reduced form, such provision shall then be enforceable and
shall be enforced.
4.2 Delivery of Records
4.2.1 Upon the termination of the Employee's employment
with the Company, the Employee will deliver to the Company
all books, records, lists, brochures and other property
belonging to the Company or developed in connection with the
business of the Company.
4.3 Confidentiality
4.3.1 The term "Confidential Information" means any and
all information concerning the business of the Company which
the Employee may receive or develop as a result of his/her
employment. All documents, procedures, policies, programs,
reports, plans, proposals, technical information, know-how,
systems and other information unique to the Company, its
customers or principals, received or developed by the
Employee are the property of the Company and/or such
parties. The Employee shall not make any unauthorized
disclosure or use of and shall use his/her best efforts to
prevent publication or disclosure or use of such
confidential information.
4.3.2 The Employee acknowledges that any unauthorized
disclosure, reproduction or use of such Confidential
Information by the Employee may result in material damages
to the Company and consents to the issuance of an injunction
or other equitable remedy to prohibit, prevent or enjoin
unauthorized disclosure or use of Confidential Information
by the Employee.
4.3.3 Except as authorized by the Company, the Employee
will not:
(a) duplicate, transfer or disclose nor allow any
other person to duplicate, transfer or disclose any of
the Company's Confidential Information;
(b) use the Company's Confidential Information without the
prior written consent of the Company; or
(c) incorporate, in whole or in part, within any
domestic or foreign patent application any proprietary
or Confidential Information disclosed by the Company.
4.3.4 The Employee will safeguard all Confidential
Information at all times so that it is not exposed to or
used by unauthorized persons, and will exercise at least the
same degree of care to protect the Employee's own
Confidential Information.
4.3.5 The restrictive obligations set forth above shall
not apply to the disclosure or use of information which:
(a) is or later becomes publicly known under
circumstances involving no breach of this agreement by
the Employee;
(b) is already known to the Employee at the time of receipt
of the Confidential Information;
(c) is lawfully made available to the Employee by a third
party; or
(d) is independently developed by and Employee of
the Employee who has not been privy to the Confidential
Information provided by the Company.
4.3.6 If the Employee contends that any such information
disclosed to him by the Company is in the public domain or
was in the possession of the Employee prior to such
disclosure and not under an obligation of confidence, the
Employee will, within ten days of receipt by the Employee of
such disclosure give written notice of such contention to
the Company, which written notice shall include a complete
identification of the information in question and the
derivation thereof, including particulars of any contract in
which the Employee or any other person has made use of such
concept or information. If the Employee has not within ten
days of receipt by the Employee of such disclosure given
such written notice to the Company, then it shall be
conclusively presumed that all information communicated by
the Company to the Employee concerning the development
originated with the Company and constitutes secret and
confidential information and know-how.
4.3.7 The Employee hereby certifies that he has not
brought and will not bring with the Employee to the Company
or use while performing his Employee duties for the Company
any materials or documents of a former employer of the
Employee which are not generally available to the public
except the know-how to which the right to use has duly
licensed to the Company by such former employer. The
Employee understands that while employed by the Company, the
employer is not to breach any obligation of confidence or
duty and the Employee agrees that he will fulfill all such
obligations during his employment with the Company.
4.3.8 No patent right or licenses are guaranteed by this
agreement and patent rights or licenses now or developed
during the term of this agreement are the property of this
Company. The disclosure of Confidential Information under
this agreement shall not result in any obligation for
either party to grant any rights in its patent rights or
confidential information, and no other obligations of any
kind are assumed by or implied against either party, except
for those stated in this agreement.
4.3.9 The provision of section 4.3 shall survive the
termination of this agreement.
5. TERMINATION
5.1 The Company may terminate the Employee's employment
under this Agreement at any time upon the occurrence of any
of the following events:
(a) the Employee acting unlawfully, dishonestly,
negligently, incompetently or in bad faith;
(b) the conviction of the Employee of a felony;
(c) the breach or default of any term of this agreement by
the Employee if such breach or default has not been remedied
to the satisfaction of the Company, acting responsibly,
within 14 days after written notice of the breach of default
has been delivered by the Company to the Employee.
5.2 In the event of the termination of the Employee's
employment under this agreement the Company shall pay the
following amounts to the Employee within ten days of the
date of termination:
(a) in the event of the termination of employment
pursuant to subsection 5.1(a), (b), (d) and (e) of this
agreement, the Company shall pay to the Employee the
full amount of compensation accrued pursuant to section
3.0 of this agreement as of the date of termination;
(b) in the event of the termination of employment
due to the death of the Employee, the Company shall pay
to the Employee's estate or legal representative the
amount of compensation accrued pursuant to section 3 of
this agreement as of the date of termination.
5.3 The Employee may terminate his obligations under this agreement:
(a) upon the default or breach of any term of this
Agreement by the Company if such breach or default has not
been remedied or is not being remedied to the satisfaction
of the Employee, acting reasonably, within 14 days after
written notice of the breach or default has been delivered
by the Employee to the Company.
5.4 In the event of the termination of the Employee's
employment under this agreement pursuant to section 5.3(a)
of this Agreement, the Company shall pay within ten days of
termination to the Employee all compensation to be paid
to the Employee under this agreement for the remainder of
the term of this agreement.
5.5 The rights of the Company and the Employee under this
section 5 are in addition to and not in derogation of any
other remedies which may be available to the Company or the
Employee at law or in equity.
6. PERSONAL NATURE
6.1 This agreement is personal and is entered into based
upon the singular skill, qualifications and experience of
the Employee.
7. WAIVER
7.1 No consent or waiver, express or implied, by any party
to this agreement of any breach or default by the other
party in the performance of its obligations under this
agreement or of any of the terms, covenants or conditions of
this agreement shall be deemed or construed to be a consent
or waiver of any subsequent or continuing breach or default
in such party's performance or in the terms, covenants and
conditions of this agreement. The failure of any party to
this agreement to assert any claim in a timely fashion for
any of its rights or remedies under this agreement shall not
be construed as a waiver of any such claim and shall not
serve to modify, alter or restrict any such party's right to
assert such claim at any time thereafter.
8. NOTICES
8.1 Any notice relating to this agreement or required or
permitted to be given in accordance with this agreement
shall be in writing and shall be personally delivered or
mailed by registered mail, postage prepaid to the address of
the parties set out on the first page of this agreement.
Any notice shall be deemed to have been received if
delivered, when delivered, and if mailed, on the fifth day
(excluding Saturdays, Sundays and holidays) after the
mailing thereof. If normal mail service is interrupted by
strike, slowdown, or other cause, a notice sent by
registered mail will not be deemed to be received until
actually received and the party sending the notice shall
utilize any other services which have not been so
interrupted or shall deliver such notice in order to ensure
prompt receipt thereof.
8,2 Each party to this agreement may change its address for
the purpose of this section 9.0 by giving written notice of
such change in the manner provided for in section 9.1.
9. APPLICABLE LAW
9.1 This agreement shall be governed by and construed in
accordance with the laws of the State of Nevada and the
federal laws of the United applicable therein, which shall
be deemed to be the proper law hereof. The parties hereto
hereby submit to the jurisdiction of the courts of Clark
County, Las Vegas, Nevada.
10. SEVERABILITY
10.1 If any provision of this agreement for any reason be
declared invalid, such declaration shall not effect the
validity of any remaining portion of the agreement, which
remaining portion shall remain in full force and effect as
if this agreement had been executed with the invalid portion
thereof eliminated and is hereby declared the intention of
the parties that they would have executed the remaining
portions of this agreement without including therein any
such part, parts or portion which may, for any reason, be
hereafter declared invalid.
11. ENTIRE AGREEMENT
11.1 This agreement constitutes the entire agreement between
the parties hereto and there are no representations or
warranties, express or implied, statutory or otherwise other
than set forth in this agreement and there are no agreements
collateral hereto other than as are expressly set forth or
referred to herein. This agreement cannot be amended or
supplement except by a written agreement executed by both
parties hereto, provided that if the Company becomes listed
on any U.S. stock market or quotation system, the terms of
this agreement may upon mutual agreement be renegotiated.
12. ARBITRATION
12.1 In the event of any dispute arising in the
determination of the compensation to be paid pursuant to
section 5 or of the Employee's salary as set out in this
agreement, the matter in dispute shall be referred to the
auditors of the Company for determination. If the auditors
cannot agree on a determination of the matter in dispute
within ten days following the referral to them, the matter
in dispute shall be referred to a single arbitrator under,
the Arbitration Act then in effect federally.
13. NON-ASSIGNABILITY
13.1 This agreement shall not be assigned by either party to
this agreement without the prior written consent of the
other party to this agreement.
14. BURDEN AND BENEFIT
14.1 This agreement shall enure to the benefit of and be
binding upon the parties hereto and their respective heirs,
executors, administrators, successors and permitted assigns.
15. TIME
15.1 Time is of the essence of this agreement.
16. COUNTERPART
16.1 This Agreement may be executed in counterpart and such
counterparts together shall constitute one and the same
instrument and notwithstanding the date of execution shall
be deemed to bear the date as set out on the first page of
this agreement.
IN WITNESS WHEREOF the Subscriber has duly executed this
subscription as of the date set out on the first page of
this agreement.
CALIFORNIA SOFTWARE CORPORATION
/s/Carol Conway, Vice President
EMPLOYEE
/s/Bruce Acacio, Employee
ACKNOWLEDGEMENT
STATE OF CALIFORNIA )
) ss:
COUNTY OF ORANGE )
IN WITNESS BEFORE ME, a Notary Public, within and for
said County and State, personally appeared Bruce Acacio and
Carol Conway, proved to me on the basis of satisfactory
evidence to be the persons described in and whose names are
subscribed to the foregoing instrument, and acknowledged to
me that they executed the same.
WITNESS, my signature this ____ day of
__________________, 1999.
___________________________________
NOTARY PUBLIC
(SEAL)
