CMO and General Manager Employment Agreement - Alex Kuo

Exhibit 10.85


EMPLOYMENT AGREEMENT
--------------------


This Employment Agreement (this "Agreement") is dated as of May 30, 2001 by
--------- and between Hai-Perng, aka Alex Kuo ("Officer") and Vertel Corporation, a
------- California corporation (the "Company").
-------


1. Term of Agreement. This Agreement will commence on the date hereof
----------------- and continue until the second anniversary of the date hereof (the "Term") unless
---- earlier terminated as provided for in Section 4 below.


2. Duties.
------


(a) Position. Officer will be employed as Chief Marketing Officer
-------- and General Manager, Network Management Tools and Solutions Group of the Company, and as such will report to the Chief Executive Officer.


(b) Obligations to the Company. Officer agrees to the best of his
-------------------------- ability and experience that he will, to the reasonable satisfaction of the Company, at all times loyally and conscientiously perform all of the duties and obligations required of him pursuant to the terms of this Agreement. Officer will comply with and be bound by the Company's operating policies, procedures and practices from time to time in effect during the Term.


3. Benefits.
--------


(a) Compensation. Officer shall not receive any guaranteed salary or
------------ base compensation. Notwithstanding the foregoing, Officer will be eligible for commissions based on the revenues of the Company, excluding any revenues received by the Company from (i) its WebResolve products, (ii) any acquisitions, joint ventures, mergers other than revenues from Seller (as hereinafter defined), or (iii) any other material corporate transactions similar to those stated in Section 3(a)(ii) hereof that add revenue to the Company (together with (i) and (ii) above, collectively, the "Excluded Revenue Base"). The Company and Officer may agree from time to time to modify or amend the definition of Excluded Revenue Base, provided however that any such modification or amendment shall be invalid and unenforceable unless it is in writing and is signed by both an authorized executive officer of the Company and Officer.


(b) Commissions. Provided that Officer continues his employment with
----------- the Company hereunder, from the date hereof, through the end of fiscal year 2001, Officer shall be eligible to earn commissions based on the following percentage of the Company's revenue (after deducting the Excluded Revenue Base):


(1) one percent (1%) of revenue up to $20,000,000 for fiscal year 2001; plus


(2) one and one-half percent (1 1/2%) of any incremental revenue between $20,000,001 and $25,000,000 for fiscal year 2001; plus


(3) two percent (2%) of any incremental revenue over $25,000,001 for fiscal year 2001.


With respect to Officer's commissions for the partial month of the Company's second fiscal quarter commencing on the date hereof and continuing through June 30, 2001, Officer shall be entitled to commissions pursuant to the following formula: one percent (1%) of the Company's revenue (less the Excluded Revenue Base) for the entire second fiscal quarter ending June 30, 2001 (the "Second Quarter"), multiplied by a fraction, the numerator of which is the number of calendar days elapsed in the second quarter that Officer is employed by the Company, and the denominator of which is the number of calendar days in the Second Quarter.


Prior to the end of fiscal year 2001, the foregoing commission structure shall be reviewed by the Compensation Committee and the Board of Directors of the Company with Officer to determine a revised commission structure based on revenue targets and percentage commission break points similar to the fiscal year 2001 commission structure for fiscal year 2002.


Officer shall receive a recapturable draw from the Company in accordance with the Company's normal payroll practices (including applicable withholdings and the like), for each fiscal quarter with an appropriate adjustment (upward or downward) on the last payroll in the month following the close of the fiscal quarter for which the actual commissions were earned. From time to time, the Company shall make a good faith estimate of the recapturable draw for each fiscal quarter and shall pay Officer the applicable pro-rata amount for each normal pay period during each such fiscal quarter.


(c) Employee Benefits. While Officer is an employee of the Company,
----------------- Officer will be eligible to participate in the Company's employee benefit plans of general application, including without limitation, those plans covering medical, disability and life insurance in accordance with the rules established for individual participation in any such plan and under applicable law. While Officer is an employee of the Company, Officer will be eligible for vacation and sick leave in accordance with the Company's policies in effect from time to time and will receive such other benefits as the Company generally provides to its other employees of comparable position and experience.


(d) Expense Reimbursement. The Company will reimburse Officer for
--------------------- all reasonable and necessary expenses actually and properly incurred by Officer in connection with Officer's duties under this Agreement provided that Officer first furnish receipts, reports, statements and vouchers for all such expenses to the Company and such expenses are incurred in accordance with the Company's general policies, procedures and guidelines regarding such expenditures (as such may be amended from time to time by the Company in its discretion).


3. Intentionally Omitted.


4. Termination of Employment.
-------------------------


(a) Officer's employment and this Agreement may be terminated upon the occurrence of any of the following events:


(i) The Company's reasonable determination in good faith that it is terminating Officer for Cause (as defined in Section 5 below)("Termination
----------- for Cause"); ---------


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(ii) The Company's determination that it is terminating Officer without Cause, which determination may be made by the Company at any time at the Company's sole discretion, for any or no reason ("Termination Without Cause");
-------------------------


(iii) Officer's voluntary termination of his employment with the Company ("Voluntary Termination"); or
---------------------


(iv) As a result of Officer's death or Disability (as defined in Section 5 below).


(b) At-Will Employment. The Company and Officer acknowledge that
------------------ Officer's employment is and will continue to be at-will, as defined under applicable law, and that Officer's employment with the Company may be terminated by either party at any time for any or no reason. Officer shall not be entitled to any payments, benefits, damages, awards or compensation of any nature upon termination of his employment with the Company.


5. Definitions. For purposes of this Agreement, the following
----------- definitions will apply:


(a) "Cause" for Officer's termination will exist if the Company
----- terminates Officer's employment for any of the following reasons: (i) Officer's willful failure substantially to perform his duties hereunder (other than any such failure due to Officer's physical or mental illness), and such willful failure is not remedied within 10 business days after written notice from the Chief Executive Officer or President, which written notice shall state that failure to remedy such conduct may result in Termination for Cause, (ii) Officer's engaging in willful and serious misconduct that has caused or is reasonably expected to result in material injury to the Company and its affiliates, taken as a whole, (iii) Officer's conviction of or entering a plea of guilty or nolo contendere to a crime that constitutes a felony, or (iv) Officer's willful breach of any of his material obligations hereunder or under any other written agreement or covenant with the Company or any of its affiliates and such willful breach is not remedied within 10 business days after written notice from the Chief Executive Officer, which written notice shall state that failure to remedy such conduct may result in Termination for Cause.


(b) "Disability" shall mean that Officer has been unable to perform
---------- his duties hereunder as the result of his incapacity due to physical or mental illness, and after its commencement such inability, which continues for at least 120 consecutive calendar days or 150 calendar days during any consecutive twelve-month period, is determined to be total and permanent by a physician selected by the Company and its insurers and acceptable to Officer or to Officer's legal representative (with such agreement on acceptability not to be unreasonably withheld).


(c) "Purchase Agreement" shall mean that certain Agreement and Plan
------------------ of Reorganization and Liquidation, dated May ____, 2001, between Trigon Technology Group, Inc., a Texas corporation ("Seller") and the Company.


6. Confidentiality Agreement; Breach of Confidentiality Provisions.
--------------------------------------------------------------- Officer will sign, or has signed, a Confidential Information and Invention Assignment Agreement (the "Confidentiality Agreement") substantially in the form
------------------------- attached hereto as Exhibit A. Officer hereby represents and warrants to the
--------- Company that he has complied with all obligations under the Confidentiality Agreement and agrees to continue to abide by the terms of the Confidentiality Agreement and further agrees that the provisions of the Confidentiality Agreement will survive


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any termination of this Agreement or of Officer's employment relationship with the Company. Officer acknowledges that upon breach of the confidentiality provisions contained in this Section 6, the Company would sustain irreparable harm from such breach, and, therefore, Officer agrees that in addition to any other remedies which the Company may have under this Agreement, the Confidentiality Agreement or otherwise, the Company will be entitled to obtain equitable relief, including specific performance and injunctions, restraining him from committing or continu ...