Blueprint





  Exhibit 10.36








EMPLOYMENT AGREEMENT

 


This
EMPLOYMENT AGREEMENT (this “Agreement”) is dated and entered
into as of July 10, 2017 (the “Effective Date”) by and between
CICERO, INC., a Delaware corporation with an address at 8000
Regency Parkway, Suite 542, Cary, North Carolina 27518 (the
“Company”), and
TODD SHERIN, an individual residing in the Commonwealth of
Pennsylvania (“Executive”).

 



W I
T N E S S E T H:

 


WHEREAS, the
Company desires to employ Executive as Chief Revenue Officer of the
Company, and the parties hereto desire to enter into this Agreement
embodying the terms of such employment.

 


NOW,
THEREFORE, in consideration of the premises and the mutual
covenants and promises of the parties contained herein, the parties
hereto, intending to be legally bound, hereby agree as
follows:

 

1. Title and Job
Duties.

 

(a) Subject to the
terms and conditions set forth in this Agreement, during the Term
(as defined below), the Company agrees to employ Executive as Chief
Revenue Officer of the Company. In this capacity, Executive shall
be responsible for (i) developing and implementing long term sales
and revenue growth strategies for the Company, (ii) leadership and
direction of Software Development and Information Technology
operations of the Company, and (iii) expenditures and staffing
needs in the functional areas of sales, customer support and
outreach, partner & channel development, product development
and information technology. In addition, Executive will work
alongside the Chief Executive Officer of the Company and the
Chairman of the board of directors of the Company (the
“Board”) to
develop strategic direction as well as corporate messaging for the
Company. Executive’s duties shall be commensurate with those
of persons in similar capacities in similarly-sized companies, and
Executive shall have such other duties, authorities and
responsibilities as the Chairman of the Board shall designate from
time to time that are not inconsistent with Executive’s
position. In performing his duties under this Agreement, Executive
shall report to the Chairman of the Board.

 

(b) Executive accepts
such employment with the Company and agrees, during the Term, to
devote his full business and professional time and energy to the
Company. The Company and Executive agree that Executive will work
out of his home office in Pennsylvania. Executive agrees to carry
out and abide by all lawful directions of the Chairman of the Board
that are consistent with his position as Chief Revenue Officer of
the Company.

 

(c) Without limiting
the generality of the foregoing, Executive shall not, without the
written approval of the Board, render services of a business or
commercial nature on his own behalf or on behalf of any other
person, firm, or corporation, whether for compensation or
otherwise, during the Term; provided, that the foregoing shall not
prevent Executive from (i) serving on the boards of directors of,
or holding any other offices or positions in, non-profit
organizations and, with the prior written approval of the Company,
other for-profit companies, (ii) participating in charitable,
civic, educational, professional, community or industry affairs,
and (iii) managing Executive’s passive personal investments,
so long as such activities in the aggregate do not materially
interfere or conflict with Executive’s duties hereunder or
create a business or fiduciary conflict for Executive or the
Company.

 

2. Base Salary and Additional
Compensation.

 

(a) Base Salary. During the Term,
the Company shall pay to Executive an annual base salary of
$150,000 (“Base
Salary”), less applicable withholdings and deductions,
payable in accordance with the Company’s normal payroll
procedures. Base Salary shall be reviewed by the Board annually and
shall be increased at the discretion of the Board.

 

(b) Commission. During the Term,
Executive shall be eligible to earn a commission (the
“Commission”)
equal to fifteen percent (15%) of the Incremental Operating Revenue
(as defined below) attributed to any New Clients (as defined below)
generated during each fiscal year of the Company.

 



 

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(i) For purposes of
this Agreement, (A) “Incremental Operating Revenue”
means (x) gross profit on incremental revenue from New Clients less
(y) a proportionate percentage of development, professional
services, marketing and general and administrative expenses of the
Company allocated to such revenue (such percentage to be equal to
the ratio of New Client revenue to total Company revenue), and (B)
“New Clients”
means new customers or clients of the Company (provided that the
existing businesses or verified pipeline leads for Company clients
and prospects listed on Exhibit A
attached hereto shall not constitute New Clients).

 

(ii) The
Commission shall not be considered earned by Executive until both a
commissionable sales transaction has been finalized and the Company
has recognized the applicable revenue from the New Client. The
Commission shall be paid by the Company to Executive, if earned,
within thirty (30) days of the end of each fiscal
quarter.

 

(iii) If
total Company revenue remains the same or increases in the fiscal
year following the first fiscal year (“Fiscal Year 1”) for which
Executive is eligible to receive the Commission
(“Fiscal Year
2”), the Company shall pay to Executive an additional
commission payment (the “Additional Commission”) (in
addition to the Commission) equal to five percent (5%) of
Incremental Operating Revenue attributed to any New Clients within
Fiscal Year 1, which Additional Commission payment shall be paid by
the Company to Executive within thirty (30) days of the end of
Fiscal Year 2. For the avoidance of doubt, this additional
commission payment constitutes a “tail” on Fiscal Year
1 earnings.

 

(iv) Executive
need not be employed by the Company at the time that the Commission
or the Additional Commission is paid by the Company, and in the
event that Executive’s employment with the Company is
terminated before any Commission or Additional Commission is paid
by the Company, Executive shall be entitled to receive such
Commission or Additional Commission when paid by the Company in
accordance with Section 2(b).

 

(c) Equity. On the Effective Date,
and subject to approval of the Board, the Company shall grant to
Executive five million (5,000,000) restricted shares of the
Company’s common stock (the “Restricted Stock”).1 The Restricted Stock shall vest as
follows: (i) fifty percent (50%) of the Restricted Stock shall vest
on the second (2nd) anniversary of the
Effective Date, provided that Executive has generated a minimum of
$1,000,000 in revenues during the two (2)-year period prior to such
second (2nd) anniversary; and
(ii) fifty percent (50%) of the Restricted Stock shall vest on the
third (3rd) anniversary of the
Effective Date, provided that Executive has generated a minimum of
$1,000,000 in revenues during the one (1)-year period prior to such
third (3rd) anniversary. Upon
the occurrence of a Change in Control (as defined below), all
Restricted Stock that has not yet vested shall immediately vest one
hundred percent (100%). For purposes of this Agreement,
“Change in
Control” shall mean each of the following with respect
to the Company:

 

(i) a sale of all or
substantially all of the Company’s assets;

 

(ii) a
sale of the voting securities of the Company such that any person
or group of persons who did not hold voting securities of the
Company prior to the transaction hold more than fifty percent (50%)
of the combined voting power of the securities of the Company after
the transaction; or

 

(iii) any
merger, consolidation or other transaction of the Company with or
into another corporation or other entity, other than a transaction
in which the holders of voting securities of the Company
immediately prior to such transaction continue to represent (either
by remaining outstanding or by being converted into voting
securities of the surviving entity or any parent thereof), at least
fifty percent (50%) of the combined voting power of the securities
of the Company or such surviving entity or parent thereof
immediately after such transaction.

 

(d) Transaction Economics. Upon a
sale of the operating assets of the Company relating to desktop
automation software, the Company shall pay to Executive a
percentage of the Net Proceeds (as defined below) in the following
amount: (i) ten percent (10%) of the first $8,000,000 of the Net
Proceeds to be received from such sale; plus (ii) fifteen percent
(15%) of any Net Proceeds from such sale in excess of $8,000,000.
For purposes of this Agreement, “Net Proceeds” shall mean proceeds
to be received by the Company from such asset sale less all closing
costs associated and incurred by the Company in connection with the
consummation of such asset sale; provided, that the proceeds from
any transaction or asset sale between the Company and Aspect
Software, Intradiem or Dell occurring within one (1) year of the
Effective Date shall not be included in the calculation of Net
Proceeds.




 



 

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3. Benefits.

 

(a) Vacation.
Executive shall be entitled to vacation in accordance with the
Company’s standard vacation policy extended to employees of
the Company generally, at levels commensurate with
Executive’s position.

 

(b) Health Insurance and Other Benefit
Plans. Executive shall be eligible to participate in the
Company’s health insurance and other employee benefit
programs, if any, that are provided by the Company for its
similarly-situated employees generally, at levels commensurate with
Executive’s position, in accordance with the provisions of
any such plans, as the same may be in effect from time to
time.

  



4. Expenses. In accordance with
the Company’s reimbursement policy, the Company shall
reimburse Executive for all reasonable business expenses properly
and reasonably incurred and paid by Executive in the performance of
his duties under this Agreement upon his presentment of detailed
receipts in the form required by the Company’s
policy.

 

5. Term of Employment. The term of
Executive’s employment with the Company shall commence on the
Effective Date and shall remain in effect until termination by
either party as set forth in Section 6 below (the
“Term”).

 

6. Termination.

 

(a) Termination by the
Company.

 

(i) For Cause. Executive’s
employment may be terminated by the Company for Cause (as defined
below) upon written notice to Executive delivered pursuant to
Section 12 of this Agreement. For purposes of this Agreement,
“Cause” shall
mean that Executive (A) pleads “guilty” or “no
contest” to, or is indicted for or convicted of, a felony
under federal or state law or a crime under federal or state law
which involves Executive’s fraud or dishonesty, (B) in
carrying out his duties, engages in conduct that constitutes gross
negligence or willful misconduct, (C) engages in misconduct that
causes material harm to the reputation of the Company (D)
materially fails to perform the responsibilities of his position,
or (E) materially breaches any term of this Agreement or written
policy of the Company.

 

(ii) Upon
Disability, Death or Without Cause. At the election of the
Board, Executive’s employment may be terminated by the
Company (A) should Executive, by reason of any medically
determinable physical or mental impairment (as determined by a
physician satisfactory to both the Company and Executive), become
unable to perform, with or without reasonable accommodation, the
essential functions of his job for the Company hereunder and such
incapacity has continued for a total of ninety (90) consecutive
days or for any one hundred eighty (180) days in a period of three
hundred sixty-five (365) consecutive days (a “Disability”), (B) upon
Executive’s death or (C) upon fourteen (14) days’ prior
written notice to Executive delivered pursuant to Section 12 of
this Agreement for any other reason or for no reason at all
(“Without
Cause”).

 

(b) Termination by
Executive.

 

(i) For Good Reason.
Notwithstanding anything contained elsewhere in this Agreement to
the contrary, Executive may terminate his employment with the
Company at any time for Good Reason (as defined below) upon written
notice to the Company delivered pursuant to Section 12 of this
Agreement stating the particular action(s) or inaction(s) giving
rise to the termination for Good Reason. The Company shall have
thirty (30) days after receipt of such a notice of termination to
cure the particular action(s) or inaction(s), and if the Company so
effects a cure, the notice shall be deemed rescinded and of no
further force and effect. For purposes of this Agreement,
“Good Reason”
means (i) the material diminution by the Company of the duties of
Executive as set forth in this Agreement without Executive’s
prior consent, other than reducing his responsibilities for Cause
or as a result of Executive’s Disability, (ii) the
Company’s requiring Executive to be primarily based at any
location other than his home office in Pennsylvania or (iii) any
material breach by the Company of this Agreement (provided that any
such act, omission, violation or breach must remain uncured after
notice from Executive and thirty (30) days’ opportunity to
cure prior to Executive’s termination of employment for Good
Reason).

 

(ii) Without
Good Reason. Notwithstanding anything contained elsewhere in
this Agreement to the contrary, Executive may terminate his
employment with the Company at any time and for any reason
whatsoever or for no reason at all in Executive’s sole
discretion by giving fourteen (14) days’ prior written notice
to the Company delivered pursuant to Section 12 of this Agreement
(“Voluntary Resignation
Without Good Reason”).

 



 

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7. Payments Upon Termination of
Employment.

 

(a) Termination for Cause, Without Cause
During the First Six (6) Months of the Term, Death, Disability or
Voluntary Resignation Without Good Reason. If
Executive’s employment is terminated by the Company for
Cause, Without Cause during the first six (6) months of the Term or
upon Executive’s death or Disability or is terminated by
Executive by Voluntary Resignation Without Good Reason, then the
Company shall pay or provide to Executive only the following
amounts in connection with the termination of Executive’s
employment: (i) all Base Salary, Commission and Additional
Commission accrued up to and including the date of termination or
resignation, to be paid by the Company at such time that such Base
Salary would have been paid to Executive in accordance with the
Company’s normal payroll procedures or, with respect to the
payment of Commission and Additional Commission, the terms of this
Agreement; (ii) an amount for all accrued, unused vacation time, to
be paid by the Company in accordance with the Company’s
policies and applicable law; (iii) all unreimbursed expenses, to be
paid by the Company in accordance with this Agreement and the
Company’s policies; and (iv) all accrued benefits under any
Company benefit plan, to be paid by the Company pursuant to the
terms of each such benefit plan (the amounts under clauses (i)
through (iv), collectively, the “Accrued
Obligations”).

 

(b) Termination Without Cause After the
First Six (6) Months of the Term or for Good Reason. If
Executive’s employment is terminated by the Company Without
Cause after the first six (6) months of the Term or by Executive
for Good Reason, then the Company shall pay or provide to Executive
the following amounts in connection with the termination of
Executive’s employment: (i) the Accrued Obligations; and (ii)
a severance payment equal to Executive’s Base Salary for
three (3) months (the “Severance Amount”), to be paid in
installments in accordance with the Company’s normal payroll
procedures. The Company’s payment of the Severance Amount is
subject to Executive’s execution and delivery of a general
release (that is no longer subject to revocation under applicable
law) of the Company, its parents, subsidiaries and affiliates
(collectively, “Affiliated
Entities”) and each of their respective officers,
directors, employees, agents, successors and assigns in the form
attached hereto as Exhibit B
(the “General
Release”). The payment of the Severance Amount shall
begin to be made within sixty (60) days following termination of
Executive’s employment; provided, however, that if the sixty
(60) day period begins in one calendar year and ends in the
following calendar year, then all payments of the Severance Amount
will be made in the second calendar year beginning with the first
pay period of such calendar year.

 

(c) Notwithstanding the
foregoing, Executive agrees that in the event that all or a portion
of any payment described in subsection (b) of this Section 7
constitutes nonqualified deferred compensation within the meaning
of Section 409A of the Internal Revenue Code of 1986, as amended
(the “Code”),
such payment or payments that constitute nonqualified deferred
compensation within the meaning of the Code shall not be made prior
to the date which is six (6) months after the date Executive
separates from service (within the meaning of the
Code).

 

8. Confidentiality.

 

(a) Executive
understands that, during the Term, he may have access to
unpublished and otherwise confidential information both of a
technical and non-technical nature, relating to the business of the
Company or any of its Affiliated Entities, or clients, including,
without limitation, any of their actual or anticipated business,
research or development, any of their technology or the
implementation or exploitation thereof, including, without
limitation, information Executive and others have collected,
obtained or created, information pertaining to clients, accounts,
vendors, prices, costs, materials, processes, codes, material
results, technology, system designs, system specifications,
materials of construction, trade secrets or equipment designs,
including information disclosed to the Company or any of its
Affiliated Entities by others under agreements to hold such
information confidential (collectively, the “Confidential Information”).
Executive agrees to observe all policies and procedures of the
Company and its Affiliated Entities concerning such Confidential
Information. Executive further agrees not to disclose or use,
either during his employment or at any time thereafter, any
Confidential Information for any purpose, including, without
limitation, any competitive purpose, unless authorized to do so by
the Company in writing, except that he may disclose and use such
information in the good faith performance of his duties for the
Company during the Term. Executive’s obligations under this
Agreement will continue with respect to Confidential Information,
whether or not his employment is terminated, until such information
becomes generally available from public sources through no wrongful
act of Executive. Notwithstanding the foregoing, however, Executive
shall be permitted to disclose Confidential Information as may be
required by law, a subpoena or other governmental order, provided
that he provides prompt notice to the Company of such required or
requested disclosure so that the Company may attempt to obtain a
protective order or other assurance that confidential treatment
will be accorded to such Confidential Information and cooperates
with the Company (at the sole cost and expense of the Company) in
attempting to obtain such order or assurance.

 



 

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(b) Upon the
Company’s request during the Term, or upon the termination of
his employment for any reason, Executive will promptly deliver to
the Company all documents, records, files, notebooks, manuals,
letters, notes, reports, customer and supplier lists, cost and
profit data, e-mail, apparatus, laptops, computers, smartphones,
tablets or other PDAs, hardware, software, drawings, blueprints,
and any other material of the Company or any of its Affiliated
Entities or clients, including all materials pertaining to
Confidential Information developed by Executive or others, and all
copies of such materials, whether of a technical, business or
fiscal nature, whether on the hard drive of a laptop or desktop
computer, in hard copy, disk or any other format, which are in his
possession, custody or control.

 

9. Assignment of Intellectual
Property.

 

(a) Executive will
promptly disclose to the Company any idea, invention, discovery or
improvement, whether patentable or not (“Creations”), conceived or made by
him alone or with others at any time during the Term. Executive
agrees that the Company owns any such Creations, and Executive
hereby assigns and agrees to assign to the Company all moral and
other rights he has or may acquire therein and agrees to execute
any and all applications, assignments and other instruments
relating thereto which the Company deems necessary or desirable.
These obligations shall continue beyond the termination of his
employment with respect to Creations and derivatives of such
Creations conceived or made during his employment with the Company.
Notwithstanding the foregoing provisions of this Section 9, the
Company and Executive understand that the obligation to assign
Creations to the Company shall not apply to any Creation which is
developed entirely on Executive’s own time without using any
of the Company’s equipment, supplies, facilities, and/or
Confidential Information and which does not result from or relate
to any work performed by Executive in connection with his
employment with the Company.

 

(b) In any jurisdiction
in which moral rights cannot be assigned, Executive hereby waives
any such moral rights and any similar or analogous rights under the
applicable laws of any country of the world that Executive may have
in connection with the Creations, and to the extent such waiver is
unenforceable, hereby covenants and agrees not to bring any claim,
suit or other legal proceeding against the Company or any of its
Affiliated Entities claiming that Executive’s moral rights to
the Creations have been violated.

 

(c) Executive agrees to
cooperate fully with the Company, both during and after the Term,
with respect to the procurement, maintenance and enforcement of
copyrights, patents, trademarks and other intellectual property
rights (both in the United States and foreign countries) relating
to such Creations. Executive shall sign all papers, including,
without limitation, copyright applications, patent applications,
declarations, oaths, formal assignments, assignments of priority
rights and powers of attorney, which the Company may deem necessary
or desirable in order to protect its rights and interests in any
Creations.

 

10. Non-Competition;
Non-Solicitation.

 

(a) During the Term and
for a period of eighteen (18) months thereafter, Executive shall
not, within the Territory (as defined below), directly or
indirectly, on his own behalf or on behalf of any person, firm or
corporation, or in any capacity whatsoever, own, manage, operate,
join, control, participate in or invest in, whether as an officer,
director, employee, partner, investor or otherwise, any business or
business entity that is primarily engaged in the development,
creation or sale of desktop automation software that competes
directly with the business of the Company (including, but not
limited to, PegaSystems, Automation Anywhere, Blue Prism,
WorkFusion, Jacada, Kofax and UIPath); provided, that the foregoing
shall not prohibit Executive from investing his funds in securities
of an issuer if the securities of such issuer are listed for
trading on a national securities exchange or are traded in the
over-the-counter market and Executive’s holdings therein
represent less than two percent (2%) of the total number of shares
or principal amount of the securities of such issuer outstanding;
provided further, that if Executive’s employment with the
Company is terminated by the Company Without Cause or by Executive
for Good Reason, then the provisions of this Section 10(a) shall
not apply.

 

(b) During the Term and
for a period of six (6) months thereafter, the Executive shall not
solicit for business or accept the business of, any person or
entity who is, or was at any time within the previous twelve
months, a Customer (defined below) of the Company or its Affiliated
Entities.

 



 

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(c) During the Term and
for a period of eighteen (18) months thereafter, the Executive
shall not, directly or indirectly, (i) employ, solicit for
employment or otherwise contract for or hire or engage any
individual who is then an employee of the Company or its Affiliated
Entities or who was an employee of the Company and its Affiliated
Entities during the twelve (12) month period preceding the
termination of Executive’s employment or (ii) take any action
that could reasonably be expected to have the effect of encouraging
or inducing any employee of the Company or any of its Affiliated
Entities to cease his or her employment with the Company or any of
its Affiliated Entities for any reason; provided, that general
solicitations of employment by Executive (whether through
advertisements, the use of placement agencies or otherwise) that
are not specifically targeted to employees of the Company (and the
hiring of any person by Executive resulting from any such general
solicitation) shall not be prohibited by this Section
10(b).

  



(d) For purposes of
this Agreement, “Territory” means the United States
of America, but if such area is determined by a court of competent
jurisdiction to be too broad, then “Territory” shall
mean the area comprising the Company’s or any of its
Affiliated Entities’, as applicable, market for its services
and products within which area Executive was materially concerned
during the twelve (12) month period prior to the termination of
this Agreement.

 

 

(e) For purposes of
this Agreement, the term “Customer(s)” shall mean any
individual, corporation, partnership, business or other entity,
whether for-profit or not-for-profit, public, privately held, or
owned by the United States government that is a business entity or
individual with whom the Company or any of its Affiliated Entities
has done business or with whom Executive has actively negotiated
with during the twelve (12) month period preceding the termination
of his employment.

 

(f) Executive agrees
that in the event a court of competent jurisdiction determines the
length of the covenants, the coverage of the Territory or the
activities prohibited under this Section 10 are too restrictive to
be enforceable, the court may reduce the scope of the restriction
to the extent necessary to make the restriction
enforceable.

 

11. Representation and Warranty.
Executive represents and warrants to the Company that he is not
subject to any agreement restricting his ability to enter into this
Agreement and fully carry out his duties and responsibilities
hereunder.

 

12. Notice. Any notice or other
communication required or permitted to be given to any of the
parties hereto shall be deemed to have been given if personally
delivered, or if sent by nationally recognized overnight courier,
and addressed as follows:

 


If to
Executive, to:

 


Todd
Sherin


2401
Walnut St


Philadelphia, PA
19103

 


If to
the Company, to:

 


c/o
Cicero, Inc.


8000
Regency Parkway


Cary,
North Carolina 25718


Attention: Launny
Steffens, Chairman


 


with a
copy to:

 


Olshan
Frome Wolosky LLP

 


1325
Avenue of the Americas

 


New
York, New York 10019

 


Attention:
Jeffery S. Spindler, Esq.

 



 

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13. Severability. If any provision
of this Agreement is declared void or unenforceable by a court of
competent jurisdiction, all other provisions shall nonetheless
remain in full force and effect.

 

14. Governing Law; Jurisdiction.
This Agreement shall be governed by, and construed and enforced in
accordance with, the laws of the State of North Carolina without
regard to the conflict of laws provisions thereof. Each of the
parties hereto hereby irrevocably submits to the exclusive
jurisdiction of any appropriate state court of record in the State
of North Carolina over any action or proceeding arising out of or
relating to this Agreement and each of the parties hereto hereby
irrevocably agrees that all claims in respect of such action or
proceeding shall be heard and determined in such North Carolina
state or Federal court. Each of the parties hereto hereby
irrevocably waives, to the fullest extent legally possible, the
defense of an inconvenient forum to the maintenance of such action
or proceeding.

 

15. Code Section 409A
Compliance.

 

(a) The intent of
the parties is that payments and benefits under this Agreement
comply with, or be exempt from, Code Section 409A and the
regulations and guidance promulgated thereunder (collectively
“Code Section
409A”) and, accordingly, to the maximum extent
permitted, this Agreement shall be interpreted to be in compliance
therewith.

 

(b) A termination of
employment shall not be deemed to have occurred for purposes of any
provision of this Agreement providing for the payment of any
amounts or benefits upon or following a termination of employment
that are considered “nonqualified deferred
compensation” under Code Section 409A unless such termination
is also a “separation from service” within the meaning
of Code Section 409A and, for purposes of any such provision of
this Agreement, references to a “termination,”
“termination of employment” or like terms shall mean
“separation from service.”

 

(c) With regard to any
provision herein that provides for reimbursement of costs and
expenses or in-kind benefits, except as permitted by Code Section
409A, (i) the right to reimbursement or in-kind benefits shall not
be subject to liquidation or exchange for another benefit, (ii) the
amount of expenses eligible for reimbursement, or in-kind benefits,
provided during any taxable year shall not affect the expenses
eligible for reimbursement, or in-kind benefits to be provided, in
any other taxable year, provided that the foregoing clause (ii)
shall not be violated without regard to expenses reimbursed under
any arrangement covered by Code Section 105(b) solely because such
expenses are subject to a limit related to the period the
arrangement is in effect and (iii) such payments shall be made on
or before the last day of Executive’s taxable year following
the taxable year in which the expense occurred.

 

(d) For purposes of
Code Section 409A, Executive’s right to receive any
installment payments pursuant to this Agreement shall be treated as
a right to receive a series of separate and distinct payments.
Whenever a payment under this Agreement specifies a payment period
with reference to a number of days (e.g., “within sixty (60)
days following the date of termination”), the actual date of
payment within the specified period shall be within the sole
discretion of the Company.

 

16. Waiver. The waiver by any of
the parties hereto of a breach of any provision of this Agreement
shall not be construed as a waiver of any subsequent breach. The
failure of a party to insist upon strict adherence to any provision
of this Agreement on one or more occasions shall not be considered
a waiver or deprive that party of the right thereafter to insist
upon strict adherence to that provision or any other provision of
this Agreement. Any waiver must be in writing.

 

17. Assignment. This Agreement is a
personal contract and Executive may not sell, transfer, assign,
pledge or hypothecate his rights, interests and obligations
hereunder. Except as otherwise herein expressly provided, this
Agreement shall be binding upon and shall inure to the benefit of
Executive and his heirs and personal representatives and shall
inure to the benefit of and be binding upon the Company and its
successors and assigns, except that the Company may not assign this
Agreement without Executive’s prior written consent, except
to an acquirer of all or substantially all of the assets of the
Company.

 

18. Injunctive Relief. 
Without limiting the remedies available to the Company, Executive
acknowledges that a breach of any of the covenants contained in
Sections 8, 9 and 10 would result in material irreparable injury to
the goodwill of the Company for which there is no adequate remedy
at law, that it will not be possible to measure damages for such
injuries precisely and that, in the event of such a breach or
threat thereof, the Company shall be entitled, without the
requirement to post bond or other security, to obtain a temporary
restraining order and/or preliminary or permanent injunction
restraining Executive from engaging in activities prohibited by
this Agreement or such other relief as may be required to
specifically enforce any of the covenants in Sections 8, 9 and 10
of this Agreement, in addition to all other remedies available at
law or in equity.

 



 

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19. Counterparts. This Agreement
may be executed in multiple counterparts, each of which shall be
deemed an original and all of which together shall be considered
one and the same agreement and shall become effective when one or
more counterparts have been signed by each of the parties and
delivered to the other party. Facsimile or .pdf signatures shall
have the same force and effect as original signatures.

 

20. Entire Agreement. This
Agreement embodies all of the representations, warranties, and
agreements between the parties hereto relating to Executive’s
employment with the Company. No other representations, warranties,
covenants, understandings, or agreements exist between the parties
hereto relating to Executive’s employment. This Agreement
shall supersede all prior agreements, written or oral, relating to
Executive’s employment. This Agreement may not be amended or
modified except by a writing signed by each of the parties hereto.
Sections 2(b)(iv) and 7 through 20 of this Agreement shall survive
the termination of this Agreement.

 


[Signature
Page Follows]

 



1 Note to Draft: Will there be a
separate equity award agreement reflecting the issuance of
Restricted Stock? Is there a Restricted Stock Plan pursuant to
which the equity will be issued?


 




 





8








 






IN
WITNESS WHEREOF, the parties hereto have caused this Employment
Agreement to be duly executed and delivered on the date first set
forth above.

 


	
 

	


COMPANY:


	
 


	

CICERO,
INC.


	
 


	
 


	
 


	

By:

	
 


	
 

	

Launny
Steffens


Chairman

	
 


	
 


	


EXECUTIVE:


	
 


	
 


	
 


	

TODD
SHERIN


	
 









 


4238358-7

9








 







EXHIBIT A



EXCLUDED BUSINESSES AND LEADS

 


Consistent
with the terms as defined in Paragraph 2(b)(i) above, the following
shall govern the definition of a New Client:

 




1.

Any profits from
existing business with a client or customer prior to July 1, 2017
or any maintenance of that business, regardless of the date, is
excluded from Incremental Operating Revenue or Additional
Commission for purposes of this Agreement.





 




2.

Any profits from
existing agreements with CH Robinson, Dell, Intertek, and Intradiem
regardless of the date on which the Company sees revenue or profit
from the business, is excluded from Incremental Operating Revenue
or Additional Commission for purposes of this
Agreement.





 




3.

New business
generated from existing clients or customers or new clients that is
not otherwise excluded by 1 and/or 2 above is a “New
Client” for purposes of calculating Incremental Operating
Revenue or Additional Commission under this Agreement. This would
apply to new business through any channel, including direct,
reseller, or original equipment manufacturer (“OEM”)
transactions.





 


 

 


 

 


 

 




4238358-7

10








 







EXHIBIT B

 



FORM OF AGREEMENT AND RELEASE

 


This
Agreement and Release (this “Agreement”), executed this
10 day of July, 2017, is entered into by and between TODD SHERIN
(“Executive”), an individual residing in the
Commonwealth of Pennsylvania with an address at 2401 Walnut St.,
Philadelphia, PA 19103, and CICERO, INC. (on behalf of its parents,
subsidiaries and affiliates, the “Company”),
a Delaware corporation with an address
at 8000 Regency Parkway, Suite 542, Cary, North Carolina
25718.


 

1. Executive’s
employment with the Company shall be terminated effective ________
(“Termination Date”). As of the Termination Date,
Executive’s duties, responsibilities, office and title shall
cease. Capitalized terms used without definition in this Agreement
shall have the meanings set forth in the Employment Agreement by
and between Executive and the Company, dated as of July 10,
2017 (the
“Employment Agreement”).

 

2. If
Executive’s employment terminates pursuant to Section 6(C) of
the Employment Agreement, then within ten (10) days of the Release
Effective Date (as defined below), the Company shall begin to pay
to Executive the Severance Amount defined in Section 7(b) of the
Employment Agreement in accordance with the terms set forth
therein.

 

(b) The Company and
Executive agree that in the event that any of the payments in this
Section 2 constitute deferred compensation within the meaning of
Section 409(A) of the Code, such payment or payments that
constitute nonqualified deferred compensation within the meaning of
the Code shall not be made prior to the date which is the earlier
of (A) the expiration of the six (6) month period measured from the
date of the “separation from service” of Executive, and
(B) thirty (30) days from the date of Executive’s death
(within the meaning of the Code).

 

1. Executive agrees
and acknowledges that the payments and/or benefits provided in
Section 2 above exceed any payments and benefits to which Executive
would otherwise be entitled under any policy, plan, and/or
procedure of the Company absent his signing this Agreement.
Executive acknowledges that he has been paid for work performed up
to and including the Termination Date and for accrued but unused
vacation.

 

2. [IF EXECUTIVE IS
OVER 40 AT THE TIME OF TERMINATION] Executive shall have up to
twenty-one (21) days from the date of his receipt of this Agreement
to consider the terms and conditions of this Agreement. Executive
may accept this Agreement at any time within the twenty-one (21)
day period by executing it and returning it to the Chairman of the
board of directors of the Company at 8000 Regency Parkway, Suite
542, Cary, North Carolina 25718, no later than 5:00 p.m. on the
twenty-first (21st) day after
Executive’s receipt of this Agreement. Thereafter, Executive
will have seven (7) days to revoke this Agreement by stating his
desire to do so in writing to the Chairman at the address listed
above, and delivering it to the Chairman no later than 5:00 p.m. on
the seventh (7th) day following the
date Executive signs this Agreement. The effective date of this
Agreement shall be the eighth (8th) day following
Executive’s signing of this Agreement (the “Release
Effective Date”), provided Executive does not revoke the
Agreement during the revocation period. In the event Executive does
not accept this Agreement as set forth above, or in the event
Executive revokes this Agreement during the revocation period, this
Agreement, including, but not limited to, the obligation of the
Company to provide the payment referred to in Section 2 above,
shall automatically be deemed null and void.

 



 

11







 





 

3. In consideration of
the payment referred to in Section 2 above, Executive, for himself
and for his heirs, executors, and assigns (hereinafter collectively
referred to as the “Releasors”), forever releases and
discharges the Company and any and all of its parent corporations,
subsidiaries, divisions, affiliated entities, predecessors,
successors and assigns, and any and all of its and their employee
benefit and/or pension plans and funds, and any and all of its and
their past or present officers, directors, stockholders, agents,
trustees, administrators, employees and assigns (whether acting as
agents for such entities or in their individual capacities)
(hereinafter collectively referred to as the
“Releasees”), from any and all claims, demands, causes
of action, fees and liabilities of any kind whatsoever (based upon
any legal or equitable theory, whether contractual, common-law,
statutory, decisional, federal, state, local or otherwise), whether
known or unknown, which Releasors ever had, now have or may have
against the Releasees or any of them by reason of any actual or
alleged act, omission, transaction, practice, conduct, occurrence,
or other matter from the beginning of the world up to and including
the Release Effective Date, except for the obligations of the
Company under this Agreement and the remaining obligations of the
Company under the Employment Agreement.

 

(a) Without limiting
the generality of the foregoing subsection (a), this Agreement is
intended to and shall release the Releasees from any and all claims
arising out of Executive’s employment with Releasees and/or
the termination of Executive’s employment, including, but not
limited to, any claim(s) under or arising out of the following: (i)
Title VII of the Civil Rights Act of 1964, as amended; (ii) the
Americans with Disabilities Act, as amended; (iii) the Employee
Retirement Income Security Act of 1974, as amended (excluding
claims for accrued, vested benefits under any employee benefit plan
of the Company in accordance with the terms of such plan and
applicable law); (iv) the Age Discrimination in Employment Act, as
amended, or the Older Workers Benefit Protection Act; (v) the North
Carolina Equal Employment Practices Act; (vi) alleged
discrimination or retaliation in employment (whether based on
federal, state or local law, statutory or decisional); (vii) the
terms and conditions of Executive’s employment with the
Company, the termination of such employment, and/or any of the
events relating directly or indirectly to or surrounding that
termination; and (viii) any law (statutory or decisional) providing
for attorneys’ fees, costs, disbursements and/or the
like.

 



 

12







 





 

(b) Notwithstanding the
foregoing, nothing in this Agreement shall be construed to prevent
Executive from filing a charge with or participating in an
investigation conducted by any governmental agency, including,
without limitation, the United States Equal Employment Opportunity
Commission (“EEOC”) or applicable state or city fair
employment practices agency, to the extent required or permitted by
law. Nevertheless, Executive understands and agrees that he is
waiving any relief available (including, for example, monetary
damages or reinstatement), under any of the claims and/or causes of
action waived in Sections 5(a) and (b), including, but not limited
to, financial benefit or monetary recovery from any lawsuit filed
or settlement reached by the EEOC or anyone else with respect to
any claims released and waived in this Agreement.

 

4. Executive agrees
that he has not and will not engage in any conduct that is
injurious to the Company’s or any of the Releasees’
reputation or interest, including, but not limited to, publicly
disparaging (or inducing or encouraging others to publicly
disparage) the Company or the Releasees.

 

(a) Executive
acknowledges that he has returned to the Company any and all
originals and copies of documents, materials, records, credit
cards, keys, building passes, computers, blackberries and other
electronic devices and other items in his possession or control
belonging to the Company or containing proprietary information
relating to the Company.

 

(b) Executive
acknowledges that the terms of Section 8, Confidentiality, Section
9, Assignment of Intellectual Property, and Section 10,
Non-Competition; Non-Solicitation, of the Employment Agreement are
incorporated herein by reference, and Executive agrees and
acknowledges that he is bound by their terms.

 

5. Executive will
cooperate with the Company and/or its subsidiaries and affiliates
and its/their counsel in connection with any investigation,
administrative proceeding or litigation relating to any matter in
which Executive was involved or of which Executive has
knowledge.

 

(a) Executive agrees
that, in the event he is subpoenaed by any person or entity
(including, but not limited to, any government agency) to give
testimony (in a deposition, court proceeding or otherwise) that in
any way relates to Executive’s employment with the Company,
he will give prompt notice of such request to the Chairman, and
will make no disclosure until the Company has had a reasonable
opportunity to contest the right of the requesting person or entity
to such disclosure, provided that nothing herein shall prevent
Executive from complying with the requirements of the
law.

 

6. The terms and
conditions of this Agreement are and shall be deemed to be
confidential, and shall not be disclosed by Executive to any person
or entity without the prior written consent of the Chairman, except
if required by law, and to Executive’s accountants,
attorneys, and spouse, provided that they agree to maintain the
confidentiality of this Agreement. Executive further represents
that he has not disclosed the terms and conditions of this
Agreement to anyone other than his attorneys, accountants and
spouse.

 

7. The making of this
Agreement is not intended, and shall not be construed, as an
admission that any of the Releasees has violated any federal, state
or local law (statutory or decisional), ordinance or regulation,
breached any contract, or committed any wrong whatsoever against
Executive.

 

8. The parties agree
that this Agreement may not be used as evidence in a subsequent
proceeding except in a proceeding to enforce the terms of this
Agreement.

 

9. Executive
acknowledges that: (a) he has carefully read this Agreement in its
entirety; (b) he has had an opportunity to consider fully the terms
of this Agreement; (c) he has been advised by the Company in
writing to consult with an attorney of his choosing in connection
with this Agreement; (d) he fully understands the significance of
all of the terms and conditions of this Agreement and he has
discussed it with his independent legal counsel, or has had a
reasonable opportunity to do so; (e) he has had answered to his
satisfaction any questions he has asked with regard to the meaning
and significance of any of the provisions of this Agreement; and
(f) he is signing this Agreement voluntarily and of his own free
will and assents to all the terms and conditions contained
herein.

 



 

13







 





 

10. This Agreement is
binding upon, and shall inure to the benefit of, the parties and
their respective heirs, executors, administrators, successors and
assigns.

 

11. If any provision of
this Agreement shall be held by a court of competent jurisdiction
to be illegal, void, or unenforceable, such provision shall be of
no force and effect. However, the illegality or unenforceability of
such provision shall have no effect upon, and shall not impair the
enforceability of, any other provision of this Agreement; provided,
however, that, upon any finding by a court of competent
jurisdiction that the release or any of the covenants provided for
by Section 5 and/or Section 6 above is illegal, void, or
unenforceable, Executive agrees to execute a release, waiver and/or
covenant with substantially similar provisions that is legal and
enforceable. Finally, any breach of any of the terms of Sections 6,
7 and/or 8 above shall constitute a material breach of this
Agreement as to which the Company may seek appropriate relief in a
court of competent jurisdiction.

 

12. This Agreement
shall be governed by, and construed and enforced in accordance
with, the laws of the State of North Carolina, without regard to
the conflict of laws provisions thereof. Actions to enforce the
terms of this Agreement, or that relate to Executive’s
employment with the Company, shall be submitted to the exclusive
jurisdiction of any appropriate state court of record in the State
of North Carolina.

 

13. This Agreement may
be executed in multiple counterparts, each of which shall be deemed
an original and all of which together shall be considered one and
the same agreement and shall become effective when one or more
counterparts have been signed by each of the parties and delivered
to the other party. Facsimile or .pdf signatures shall have the
same force and effect as original signatures.

 

14. This Agreement
(including any exhibits attached hereto) constitutes the complete
understanding between the parties with respect to the termination
of Executive’s employment at the Company and supersedes any
and all agreements, understandings, and discussions, whether
written or oral, between the parties. No amendment of any provision
of this Agreement shall be valid unless the same shall be in
writing and signed by each of the parties hereto.

 


	
 

	
 

	
 


	

Dated:

	
 

	
 

	
 


	
 

	
 

	

TODD
SHERIN







 


	

CICERO,
INC.

	
 

	
 


	
 

	
 

	
 


	

By:

	
 

	

Date:

	
 


	
 

	

Name:

	
 

	
 

	
 


	
 

	

Title:

	
 

	
 

	
 







 




4238358-7

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