EXHIBIT 23.1
 
EMPLOYMENT AGREEMENT

This Employment Agreement (the “Agreement”) is made and entered into this 01 day
of January, 2012, by and between CICERO INC, a Delaware corporation (the
“Company”), and Antony Castagno, a resident of the State of Georgia (the
“Employee”).
 
In consideration of the mutual covenants, promises and conditions set forth in
this Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:

1.
Employment.  The Company hereby employs Employee and Employee hereby accepts
such employment upon the terms and conditions set forth in this Agreement.

2.
Duties of Employee.  Employee will be based in Georgia or North Carolina at the
discretion of the Company.  Employee’s title will be Chief Technology Officer
and Employee will report directly to the Chief Executive Officer.  Employee
agrees to perform and discharge such other duties as may be assigned to Employee
from time to time by the Company to the reasonable satisfaction of the Board of
Directors, and such duties will be consistent with those duties regularly and
customarily assigned by the Company to the position of Chief Technology
Officer.  Employee agrees to comply with all of the Company's policies,
standards and regulations and to follow the instructions and directives as
promulgated by the Board of Directors of the Company (“Policies”).  Employee
will devote Employee's full professional and business-related time, skills and
best efforts to such duties and will not, during the term of this Agreement, be
engaged (whether or not during normal business hours) in any other business or
professional activity, whether or not such activity is pursued for gain, profit
or other pecuniary advantage, without the prior written consent of the Board of
Directors of the Company.  This Section will not be construed to prevent
Employee from (a) investing personal assets in businesses which do not compete
with the Company in such form or manner that will not require any services on
the part of Employee in the operation or the affairs of the companies in which
such investments are made and in which Employee's participation is solely that
of an investor; (b) purchasing securities in any corporation whose securities
are listed on a national securities exchange or regularly traded in the
over-the-counter market, provided that Employee at no time owns, directly or
indirectly, in excess of one percent (1%) of the outstanding stock of any class
of any such corporation engaged in a business competitive with that of the
Company; or (c) participating in conferences, preparing and publishing papers or
books, teaching or joining or participating in any professional associations or
trade group, so long as the Board of Directors of the Company approves such
participation, preparation and publication or teaching prior to Employee’s
engaging therein.

3.
Term.  The term of this Agreement will be at-will, and can be terminated by
either party at any time, with or without cause, subject to the provisions of
Section 4 of this Agreement.  Subject to the provisions of Section 4, this
Agreement will cover the period January 01, 2012 through December 31, 2012 and
thereafter successive annual periods unless a party provides the other with
written notice of its intention to terminate this Agreement, which notice shall
be delivered no later than thirty (30) days prior to the expiration of the
initial term or any renewal term, as applicable.

 
 
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4.
Termination.

 
(a)
Termination by Company for Cause.  The Company may terminate this Agreement and
all of its obligations hereunder immediately, including the obligation to pay
Employee severance, vacation pay or any further accrued benefits or
remuneration, if any of the following events occur:

 
(i)
Employee improperly performs, or fails to perform, his duties and
responsibilities or materially breaches any of the terms or conditions set forth
in this Agreement, a Policy, or invention assignment, confidentiality,
non-solicitation or non-competition agreement with or for the benefit of the
Company, SOAdesk, LLC (“SOAdesk”) or Vertical Thought, Inc. (“VTI”) and fails to
cure such breach within ten (10) days after Employee's receipt from the Company
of written notice of such breach (notwithstanding the foregoing, no cure period
shall be applicable to breaches by Employee of Sections 10 through 14 of this
Agreement or of provisions of such Policies or agreements relating to any
thereof);

 
(ii)           
Employee commits any other act materially detrimental to the business or
reputation of the Company;

(iii)          
Employee engages in willful misconduct, including fraud or intentional
misrepresentation;

(iii)          
Employee engages in dishonest activities or commits or is convicted of, or
pleads guilty or nolo contendere to, any felony or a misdemeanor involving
fraud, deceit, moral turpitude or unethical business conduct;

(iv)         
Employee engages in habitual alcohol or drug abuse that continues after written
notice from the Company, which abuse has (a) had an adverse effect on Employee’s
productivity or ability to carry out his duties under this Agreement, (b)
jeopardized the safety of any other employee of the Company or any person having
business relations with the Company, (c) damaged the reputation of the Company,
or (d) endangered the Company’s ability to compete for business; or

 
(v)
Employee dies or becomes mentally or physically incapacitated or disabled so as
to be unable to perform Employee's duties under this Agreement even with a
reasonable accommodation.  Without limiting the generality of the foregoing,
Employee's inability adequately to perform services under this Agreement for a
period of sixty (60) consecutive days will be conclusive evidence of such mental
or physical incapacity or disability, unless such inability is pursuant to a
mental or physical incapacity or disability covered by the Family Medical Leave
Act, in which case such sixty (60) day period shall be extended to a one hundred
and twenty (120) day period.

 
(b)
Termination by Company Without Cause.  The Company may terminate Employee's
employment pursuant to this Agreement for reasons other than those stated in
Section 4(a) upon at least thirty (30) days' prior written notice to Employee.
In the event Employee's employment with the Company is terminated by the Company
without cause, and subject to the execution by Employee and effectiveness of a
customary release in a form reasonably satisfactory to the Company, the Company
shall be obligated to pay Employee severance payments equal to six (6) months of
Employee’s then base salary in the aggregate.  In addition, Employee will be
entitled to payment of all unused vacation days at his current daily rate and
any accrued but unpaid salary or earned bonuses.  The foregoing severance and
other payments shall be payable (subject to the effectiveness of such customary
release) in equal semi-monthly installments over the six (6) month period
following Employee’s termination in accordance with the Company’s standard
payroll practices. Employee will be entitled to receive no further remuneration
and will not be entitled to participate in any Company benefit programs
following his termination by the Company, whether such termination is with or
without cause.

 
 
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5.           Compensation and Benefits.

 
(a)
Annual Salary.  During the term of this Agreement and for all services rendered
by Employee under this Agreement, the Company will pay Employee a base salary of
One Hundred and Fifty Thousand Dollars ($150,000.00) per annum in equal
semi-monthly installments.

 
(b)
Incentive Compensation.  Employee is eligible for an annual bonus upon the
Company reaching certain pre tax income levels (after accounting for all
bonuses)  as set forth in Exhibit C.  Said bonus will be payable after the
annual accounts have been presented to the Compensation Committee. Exhibit C
attached hereto provides the benchmarks associated with achieving the Incentive
Compensation.

 
(c)
Equity Awards.  Employee is eligible for stock option grants and restricted
stock awards as determined by the Compensation Committee.

6.
Vacation.  Employee shall be eligible for four (4) weeks of paid vacation
annually, provided that such vacation is scheduled at such times that do not
interfere with the Company’s legitimate business needs.

 
7.
Other Benefits.  Employee will be entitled to such fringe benefits as may be
provided from time-to-time by the Company to its employees, including, but not
limited to, group health insurance, life and disability insurance, and any other
fringe benefits now or hereafter provided by the Company to its employees, if
and when Employee meets the eligibility requirements for any such benefit.  The
Company reserves the right to change or discontinue any employee benefit plans
or programs now being offered to its employees; provided, however, that all
benefits provided for employees of the same position and status as Employee will
be provided to Employee on an equal basis.

8.
Business Expenses.  Employee will be reimbursed for all reasonable expenses
incurred in the discharge of Employee's duties under this Agreement pursuant to
the Company's standard reimbursement policies.

 
 
9.
Withholding.  The Company will deduct and withhold from the payments made to
Employee under this Agreement, state and federal income taxes, FICA and other
amounts normally withheld from compensation due employees.

10.
Non-Disclosure of Proprietary Information.  Employee recognizes and acknowledges
that the Trade Secrets (as defined below) and Confidential Information (as
defined below) of the Company and its affiliates, including for purposes of this
Section 10 any of the same purchased from SOAdesk or VTI, and all physical
embodiments thereof (as they may exist from time-to-time, collectively, the
“Proprietary Information”) are valuable, special and unique assets of the
Company's and its affiliates' businesses. Employee further acknowledges that
access to such Proprietary Information is essential to the performance of
Employee's duties under this Agreement.  Therefore, in order to obtain access to
such Proprietary Information, Employee agrees that, except with respect to those
duties assigned to him by the Company, Employee will hold in confidence all
Proprietary Information and will not reproduce, use, distribute, disclose,
publish or otherwise disseminate any Proprietary Information, in whole or in
part, and will take no action causing, or fail to take any action necessary to
prevent causing, any Proprietary Information to lose its character as
Proprietary Information, nor will Employee make use of any such information for
Employee's own purposes or for the benefit of any person, firm, corporation,
association or other entity (except the Company) under any circumstances.

 
 
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For purposes of this Agreement, the term “Trade Secrets” means information,
including, but not limited to, any technical or nontechnical data, formula,
pattern, compilation, program, device, method, technique, drawing, process,
financial data, financial plan, product plan, list of actual or potential
customers or suppliers, or other information similar to any of the foregoing,
which derives economic value, actual or potential, from not being generally
known to, and not being readily ascertainable by proper means by, other persons
who can derive economic value from its disclosure or use.  For purposes of this
Agreement, the term “Trade Secrets” does not include information that Employee
can show by competent proof (i) was known to Employee and reduced to writing
prior to disclosure by the Company (but only if Employee promptly notifies the
Company of Employee’s prior knowledge; (ii) was generally known to the public at
the time the Company disclosed the information to Employee; (iii) became
generally known to the public after disclosure by the Company through no act or
omission of Employee; or (iv) was disclosed to Employee by a third party having
a bona fide right both to possess the information and to disclose the
information to Employee; provided, that clauses (i) through (iv) shall not be
available for Trade Secrets of or purchased from SOAdesk or VTI.  The term
“Confidential Information” means any data or information of the Company, other
than trade secrets, which is valuable to the Company and not generally known to
competitors of the Company.  The provisions of this Section 6 will apply to
Trade Secrets for so long as such information remains a trade secret and to
Confidential Information during Employee’s employment with the Company and for a
period of two (2) years following any termination of Employee’s employment with
the Company for whatever reason.
 
11. 
Non-Solicitation Covenants.  Employee agrees that during Employee's employment
by the Company and for a period of two (2) year following the termination of
Employee's employment for whatever reason, Employee will not, directly or
indirectly, on Employee's own behalf or in the service of or on behalf of any
other individual or entity, divert, solicit or attempt to divert or solicit any
individual or entity (i) who is a client of the Company or SOAdesk at any time
during the six (6)-month period prior to Employee's termination of employment
with the Company (“Client”), or was actively sought by the Company or SOAdesk as
a prospective client, and (ii) with whom Employee had material contact while
employed by or providing services to or for the benefit of the Company, SOAdesk
or VTI to provide similar services or products as such provided by Employee for
the Company, SOAdesk or VTI to such Clients or prospects.  Employee further
agrees and represents that during Employee's employment by the Company and for a
period of  two (2) year following any termination of Employee's employment for
whatever reason, Employee will not, directly or indirectly, on Employee's own
behalf or in the service of, or on behalf of any other individual or entity,
divert, solicit or hire away, or attempt to divert, solicit or hire away, to or
for any individual or entity which is engaged in providing similar services or
products to that provided by the Company, SOAdesk or VTI, any person employed by
the Company for whom Employee had supervisory responsibility or with whom
Employee had material contact while employed by or providing services to or for
the benefit of the Company, SOAdesk or VTI, whether or not such employee is a
full-time employee or temporary employee of the Company, whether or not such
employee is employed pursuant to written agreement and whether or not such
employee is employed for a determined period or at-will.  For purposes of this
Agreement, “material contact” exists between Employee and a Client or potential
Client when (1) Employee established and/or nurtured the Client or potential
Client; (2) the Client or potential Client and Employee interacted to further a
business relationship or contract with the Company, SOAdesk or VTI; (3) Employee
had access to confidential information and/or marketing strategies or programs
regarding the Client or potential Client; and/or (4) Employee learned of the
Client or potential Client through the efforts of the Company, SOAdesk or VTI
providing Employee with confidential Client information, including but not
limited to the Client’s identify, for purposes of furthering a business
relationship.  

12. 
Existing Restrictive Covenants.  Except as provided in Exhibit B, Employee has
not entered into any agreement with any employer or former employer: (a) to keep
in confidence any confidential information, or (b) to not compete with any
former employer.  Employee represents and warrants that Employee's employment
with the Company does not and will not breach any agreement which Employee has
with any former employer to keep in confidence confidential information or not
to compete with any such former employer.  Employee will not disclose to the
Company or use on its behalf any confidential information of any other party
required to be kept confidential by Employee.

 
 
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13. 
Return of Proprietary Information.  Employee acknowledges that as a result of
Employee's employment with the Company, Employee may come into the possession
and control of Proprietary Information, such as proprietary documents, drawings,
specifications, manuals, notes, computer programs, or other proprietary
material.  Employee acknowledges, warrants and agrees that Employee will return
to the Company all such items and any copies or excerpts thereof, and any other
properties, files or documents obtained as a result of Employee's employment
with the Company, immediately upon the termination of Employee's employment with
the Company.

14. 
Proprietary Rights.  During the course of Employee's employment with the
Company, Employee may make, develop or conceive of useful processes, machines,
compositions of matter, computer software, algorithms, works of authorship
expressing such algorithm, or any other discovery, idea, concept, document or
improvement which relates to or is useful to the Company's Business (the
“Inventions”), whether or not subject to copyright or patent protection, and
which may or may not be considered Proprietary Information.  Employee
acknowledges that all such Inventions will be “works made for hire” under United
States copyright law and will remain the sole and exclusive property of the
Company.  Employee also hereby assigns and agrees to assign to the Company, in
perpetuity, all right, title and interest Employee may have in and to such
Inventions, including without limitation, all copyrights, and the right to apply
for any form of patent, utility model, industrial design or similar proprietary
right recognized by any state, country or jurisdiction.  Employee further
agrees, at the Company's request and expense, to do all things and sign all
documents or instruments necessary, in the opinion of the Company, to eliminate
any ambiguity as to the ownership of, and rights of the Company to, such
Inventions, including filing copyright and patent registrations and defending
and enforcing in litigation or otherwise all such rights.  

Employee will not be obligated to assign to the Company any Invention made by
Employee while in the Company's employ which does not relate to any business or
activity in which the Company is or may reasonably be expected to become
engaged, except that Employee is so obligated if the same relates to or is based
on Proprietary Information to which Employee has had access during and by virtue
of Employee's employment by the Company or providing services to or for the
benefit of SOAdesk or VTI or which arises out of work assigned to Employee by
the Company, SOAdesk or VTI.  Employee will not be obligated to assign any
Invention which may be wholly conceived by Employee after Employee leaves the
employ of the Company, except that Employee is so obligated if such Invention
involves the utilization of Proprietary Information obtained while in the employ
of the Company, SOAdesk or VTI.  Employee is not obligated to assign any
Invention that relates to or would be useful in any business or activities in
which the Company is engaged if such Invention was conceived and reduced to
practice by Employee prior to Employee's employment with the Company, except if
conceived while providing service to or for the benefit of SOAdesk or
VTI.  Employee agrees that any such Invention is set forth on Exhibit “A” to
this Agreement.

15. 
Remedies.  Employee agrees and acknowledges that the violation of any of the
covenants or agreements contained in Sections 10 through 14 of this Agreement
would cause irreparable injury to the Company, that the remedy at law for any
such violation or threatened violation thereof would be inadequate, and that the
Company will be entitled, in addition to any other remedy, to temporary and
permanent injunctive or other equitable relief without the necessity of proving
actual damages or posting a bond.

 
 
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16. 
Severability.  In case one or more of the provisions contained in this Agreement
is for any reason held to be invalid, illegal or unenforceable in any respect,
the parties agree that it is their intent that the same will not affect any
other provision in this Agreement, and this Agreement will be construed as if
such invalid or illegal or unenforceable provision had never been contained
herein.  It is the intent of the parties that this Agreement be enforced to the
maximum extent permitted by law.

 
17. 
Entire Agreement.  This Agreement embodies the entire agreement of the parties
relating to the subject matter of this Agreement and supersedes all prior
agreements, oral or written, regarding the subject matter hereof.  No amendment
or modification of this Agreement will be valid or binding upon the parties
unless made in writing and signed by the parties.

18. 
Governing Law.  This Agreement is entered into and will be interpreted and
enforced pursuant to the laws of the State of North Carolina.  The parties
hereto hereby agree that the appropriate forum and venue for any disputes
between any of the parties hereto arising out of this Agreement shall be any
federal court in the state where the Employee has his principal place of
residence and each of the parties hereto hereby submits to the personal
jurisdiction of any such court.  The foregoing shall not limit the rights of any
party to obtain execution of judgment in any other jurisdiction.  The parties
further agree, to the extent permitted by law, that a final and unappealable
judgment against either of them in any action or proceeding contemplated above
shall be conclusive and may be enforced in any other jurisdiction within or
outside the United States by suit on the judgment, a certified exemplified copy
of which shall be conclusive evidence of the fact and amount of such judgment.

19. 
Surviving Terms.  Sections 4, 10, 11, 13, 14, 15 and 18 of this Agreement shall
survive termination of this Agreement.

 
 
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above written.
 

          COMPANY:     EMPLOYEE:            
CICERO, INC.
   
 
 

            By:             
Name
    Antony Castagno    
Title 
       

 
 
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EXHIBIT A

INVENTIONS
 
Employee represents that there are no Inventions.

 
         
Employee Initials
 

 
 
 
 
 
 
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EXHIBIT B

EXISTING RESTRICTIVE COVENANTS
 
Employee Non-Disclosure, Non-Solicitation, Non-Competition and Assignment
Agreement, dated as of June 17, 2005, by and between Tony Castagno and OpenSpan,
Inc.
 
 
 
 
 
 
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EXHIBIT C

VARIABLE COMPENSATION
 
For Fiscal 2012:

Annual Cash Bonus:

Employee is entitled to an annual cash bonus payable after the Company has
reported its results for the year. This annual cash bonus is tied to Operating
Net Income before taxes as per the chart below:

 
Operating Net Income  Range (before tax)
           
From
To
Variable Compensation
         
Less than Target Operating Net Income
 
None
       
Tier 1
Achieve Target Operating Net Income up to 120% of Target
 
43% of base compensation
       
Tier 2
Achieve >120% of Target Net Operating Income ; < 150%
 
86% of base compensation
       
Tier 3
Achieve > 150% of Target Net Operating Income
 
143% of base compensation
         
Performance significantly in excess of Tier 3 may result in an additional reward
at the discretion of the Compensation Committee

 
 
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