Exhibit 10.12
EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT AGREEMENT (“
Agreement ”) is made as of December 29, 2005 by
and between USN Corporation, a Colorado Corporation (“
USN ” or the “Company”) and Brad Berdow
(the “ Executive ”).
NOW, THEREFORE,
in consideration of the foregoing
and for other good and valuable consideration, the parties agree as
follows
The parties are entering into this
Agreement in order to set forth the terms and conditions under
which the Executive shall continue to be employed by the
Company.
NOW, THEREFORE, the parties hereto,
intending to be legally bound hereby, and in consideration of the
mutual covenants contained herein, agree as follows:
1. Employment . USN hereby
agrees to employ the Executive and the Executive hereby accepts
employment on the terms and conditions set forth herein. The
Executive’s employment with the USN shall commence on the
date hereof.
2. Employment at Will . The
Executive and USN understand and agree that the Executive is an
employee at will, and that the Executive may resign, or USN may
terminate the Executive’s employment, at any time and for any
or for no reason and consistent with Section 6 of this
Agreement. Nothing in this Agreement or any Related Agreements (as
hereinafter defined) shall be construed to alter the at-will nature
of the Executive’s employment, nor shall anything in this
Agreement or any Related Agreements be construed as providing the
Executive with a definite term of employment.
3. Position . During the
Executive’s employment with USN, the Executive shall serve as
Vice President—Business Development and General Counsel of
the Company. The Executive shall perform those duties generally
required of persons in the position, as well as such other duties,
not inconsistent with this Agreement, as the CEO and Board of
Directors (the “ Board ”) may lawfully from time
to time direct. The Executive shall report and be responsible to
the CEO of the Company and to the USNR’s Board of Directors
and Chairman.
4. Base Salary, Compensation and
Benefits .
4.1 Compensation . During the
Executive’s employment, USN agrees to pay, and the Executive
agrees to accept as compensation for all services to be rendered by
the Executive hereunder, a salary at a monthly rate of fourteen
thousand five hundred eighty three dollars and thirty three cents
($14,583.33) (before deductions for advances and deductions made at
Executive’s request, if any, and for deductions required by
federal, state and local law) (“Base Salary”), payable
at the same time that the Company pays its employees generally. The
Base Salary is subject to increases (annual or otherwise) in the
sole discretion of the Board.
4.2 Stock Grant . The
Executive shall be entitled to an initial stock unit grant and
stock options as referenced on Exhibit A attached
hereto.
4.3 Incentives, Savings and
Retirement Plans . The Executive shall also be entitled to
participate at similar levels in all incentive, savings, and
retirement plans, policies and programs made
available by the Company to
executive-level employees generally (“ Plans ”).
Company agrees to cover the costs of Executive’s current Blue
Cross PPO health insurance policy or another similarly situated
policy of Executive’s choice. Company also agrees to cover
any reasonable professional fees and subscriptions relating to
Executive’s position with Company, including but not limited
to annual bar fees and continuing legal education
credits.
4.4 Reimbursement . The
Company shall reimburse the Executive (or, in the Company’s
sole discretion, shall pay directly), upon presentation of vouchers
and other supporting documentation as the Company may reasonably
require, for reasonable out-of-pocket expenses incurred by the
Executive which relate to the business or affairs of the Company or
the performance of the Executive’s duties hereunder,
including, without limitation, direct expenses with respect to
meals, travel and similar items, provided that the incurring
of such expenses shall have been approved in accordance with the
Company’s regular reimbursement procedures and practices in
effect from time to time.
4.5 Vacation . In addition to
statutory holidays, the Executive shall be entitled to four
(4) weeks paid vacation each calendar year during the
Executive’s employment, accruing ratably each month. Unused
vacation shall accrue to a maximum of two times the annual accrual
(for example a maximum accrual of eight (8) weeks if Executive
earns (4) weeks vacation per year.)
4.6 Withholding . The Company
may withhold from the Executive’s Compensation all applicable
amounts required by law.
5. Payments Upon Termination of
Employment . In the event the Executive’s employment with
the Company terminates for any reason (including Disability (as
hereinafter defined)), the Company shall pay to the Executive any
Compensation including accrued vacation pay, expense
reimbursements, compensation and benefits under any Plan, and any
and all benefits and other similar amounts, accrued but unpaid as
of the date of termination. In the event of the Executive’s
death, the Company shall pay any Compensation including accrued
vacation pay, expense reimbursements, compensation and benefits
under any Plan, and any and all benefits and other similar amounts,
accrued but unpaid as of the date of death to Executive’s
estate. In addition, upon termination of the Executive’s
employment by the Company without Cause, and contingent upon the
Executive’s execution and delivery of a general release
reasonably satisfactory to the Company releasing the Company, its
officers, managers, agents, members, and affiliates from any
liability for any matter other than for payments under this
Section 5 and contractual obligations under other written
agreements, the Company shall pay to the Executive an amount equal
to a six (6) months portion of the Compensation as described
in Section 4.1 above (“ Severance ”), to be
paid pursuant to Company’s payroll cycle for the six
(6) months following termination of employment; provided,
however, that if Executive’s termination of employment occurs
between December 15 and December 31 of any calendar year,
the Severance will be fully paid no later than March 15 of the
next following calendar year. The parties further acknowledge that
there are not any express or implied agreements that affect or
impair the ability of Executive or Company to terminate the
employment relationship at will. Upon termination of the
Executive’s employment any rights to fixed and contingent
compensation including but not limited to bonuses, royalties,
commissions or any other payment obligations by Employer shall
cease.
5.1 Return of Records and
Property. Upon termination of Executive’s employment with
the Company, Executive shall promptly deliver to the Company any
and all Company records and any and all Company property in his
possession or under his control, including without limitation
manuals, books, blank forms, documents, letters, memoranda, notes,
notebooks, reports, printouts,
computer disks, computer tapes,
source codes, data, tables or calculations and all copies thereof,
documents that in whole or in part contain any trade secrets or
confidential, proprietary or other secret information of the
Company and all copies thereof, and keys, access cards, access
codes, passwords, credit cards, personal computers, telephones and
other electronic equipment belonging to the Company.
6. Confidentiality . In the
course of developing its business and goodwill, Company has
developed and continues to develop unique techniques, processes,
and compilations of information that it uses in the design,
styling, pricing, selling and marketing of its products and
services. This non-public information is a valuable asset, allows
Company to maintain a competitive advantage, and is deemed
propriety, confidential, and is a trade secret of Company.
Therefore, Company desires to maintain and preserve the
confidentiality of its trade secrets regarding its business from
any unauthorized disclosures. To enable Executive to perform the
services contemplated hereunder, Company may disclose or authorize
the disclosure of Confidential Information to Executive. Executive
acknowledges and expressly agrees that Company’s Confidential
Information is a valuable asset. Confidential Information is
defined as any information which meets the definition of
“trade secret” under Cal. Civil Code §3426.1.
Executive agrees that all Confidential Information, or any copy,
extract or summary, whether originated or prepared by or by or for
Company, is and shall remain the exclusive property of Company.
Executive agrees to not disclose to others, either directly or
indirectly, or take or use for Executive’s own purposes or
the purposes of others, the Confidential Information of Company.
Executive shall not disclose the name of any executive, customer,
sales representative or independent contractor of Company to any
third party, unless the disclosure occurs during Executive’s
employment with Company, and is reasonably required to further the
interests of Company. These restrictions shall also apply to:
(i) trade secrets or confidential information conceived by or
belonging to third parties which are in Company’s possession;
and (ii) trade secrets or Confidential Information conceived,
originated, discovered or developed by Executive within the scope
of Executive’s employment.
6.1 Ownership of Intellectual
Property . During the Term of Executive’s employment,
Executive may develop or participate in the development of
trademarks, copyrights, customer and vendor lists and other
proprietary information, including processes and methods relating
to the business of Company. If it is determined that any of the
information identified above is, in whole or in part, not entitled
to protection as a trade secret, it shall be Confidential
Information that is protected by this Agreement. Executive
acknowledges and expressly agrees that Company’s property
shall include any invention, improvement, development,
copyrightable matter, design, idea or suggestion conceived, made,
devised or developed by Executive, solely or jointly with others:
(i) during regular working hours or with the use of
Company’s equipment, resources, supplies, facilities,
Confidential Information or trade secrets; (ii) during the
term of Executive’s employment whether during regular working
hours or not, which relates to business of Company; or
(iii) during the term of Executive’s employment, and
after, which embodies, uses or is the result of any Confidential
Information of Company that Executive has knowledge of shall become
the sole property of Company. As to each invention, improvement,
development, copyrightable matter, design, idea, suggestions or
other matter described above, Executive assigns to Company all
rights, including all copyright, trademark and patent right and all
other claims of ownership which Executive has or may have in the
future. Executive agrees that, upon request by Company, Executive
shall promptly execute all instruments and documents requested by
Company, including but not limited to applications for Letters
Patent and assignment of the rights thereto. Upon the termination
of Executive’s employment, or whenever required by Company,
Executive shall immediately deliver to Company all property and
materials in Executive’s possession or under
Executive’s control belonging to Company, or developed by
Executive while employed by Company,
including but not limited to, all
physical embodiments of Confidential Information. This Provision
does not apply to any invention that qualifies under the provisions
of Section 2870 of the California Labor Code.
6.2 Non-Solicitation. During
the term of Executive’s employment with the Company and for a
period of 6 consecutive months from the date of the termination of
such employment, if such termination is with Cause (as defined
below in Section 7.1), Executive shall not, directly or
indirectly, hire, engage or solicit any person who is then an
employee or consultant of the Company or who was an employee or
consultant of the Company at the time of Executive’s
employment, in any manner or capacity, including without limitation
as a proprietor, principal, agent, partner, officer, director,
stockholder, Executive, member of any association, consultant or
otherwise.
6.3 Non-Disparagement and No
Publicity. Executive acknowledges that during the course of his
relationship with Employer he has acqui
