CONFIDENTIALITY AND NONDISCLOSURE AGREEMENT
This CONFIDENTIALITY AND NONDISCLOSURE AGREEMENT (the "Agreement")
effective as of August 1, 2003 is entered into by and between Rod
Welch, an individual, ("Disclosing Party") and Jerry J. Nord, an
individual ("Recipient"). The purpose of the Agreement is solely
to allow Recipient to evaluate business opportunity and places no
duty on either party for any performance, except as mutually
elected, and except that Recipient shall maintain confidentiality
of Disclosing Parties intellectual property, as defined in
and shall be liable for damages to Disclosing Party in the event
that confidentiality is breached.
Recipient is employed as an Application Software Support manager
for a company, CSG, in Omaha, Nebraska. CSG develops and markets
software products and provides billing and provisioning services
to Cable and Telephony customers.
Disclosing Party developed and owns the Schedule Diary System (SDS)
software program, and methods of deployment and use that comprise
the science of Communication Metrics (SDS and Communication Metrics
are the "Technology" as defined in
which contains patentable, proprietary and confidential material of
Disclosing Party and trade secrets of Disclosing Party.
Disclosing Party desires to have Recipient evaluate forming a
business with Disclosing Party to market the Technology and
maintain the confidentiality of the patentable, proprietary and
confidential material of Disclosing Party and trade secrets of
Disclosing Party contained in the Technology which must be
disclosed and transferred to the Recipient in connection with
evaluating business opportunity.
Recipient desires to evaluate forming a business with Disclosing
Party to market the Technology. Accomplishing this purpose
requires technology transfer to Recipient by learning and gaining
experience using the technology with support by Disclosing Party
for a period of approximately six (6) months. Recipient has agreed
to maintain the confidentiality of the patentable, proprietary and
confidential material of Disclosing Party and trade secrets of
Disclosing Party pursuant to the terms and conditions of this
NOW THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are acknowledged, and as a condition of such
proprietary and/or confidential information and/or trade secrets
being disclosed, Disclosing Party and the Recipient agree as
- Confidential Information.
"Confidential Information" means any information relating
to, referring to, incorporated or contained in the
Technology, including, but not limited to, trade secrets of
the Technology, as set out in
relating to the Technology, promotional plans for the
Technology, business relationships of the Disclosing Party,
equipment involved in the production of the Technology,
provision of services related to the Technology, or any
other information of Disclosing Party that derives
independent economic value, actual or potential, from not
being generally known to the public or to other persons who
can obtain economic value from its disclosure or use.
Confidential Information does not include any information
that: (a) was already legally known to Recipient prior to
the time that it is disclosed to the Recipient by Disclosing
Party after execution of this Agreement; (b) is in or has
entered the public domain through no breach of this
Agreement or other wrongful act of the Recipient; (c) has
been rightfully received from a third party not under an
obligation of confidentiality in connection with the
Confidential Information or without a breach of this
Agreement; (d) has been approved for release by the prior
written authorization of Disclosing Party; or (e) is
required to be produced in compliance with applicable law or
a court order, as evidenced by the written opinion of legal
counsel, provided that Disclosing Party is given reasonable
notice of such law or order and an opportunity to attempt to
seek a protective order or otherwise preclude or limit such
production. Recipient may demonstrate, write about and
discuss the Technology with others for purposes of
performing this Agreement, provided there is attribution of
ownership to the Disclosing Party and provided further that
there is prior approval of Disclosing Party.
- Purpose of Disclosing Confidential Information.
It is understood and agreed to by Disclosing Party and the
Recipient that any exchange of Confidential Information
under this Agreement shall be solely for the purpose of
evaluating the opportunity to form a business with Disclosing
Party. The parties further agree that such evaluation
requires using the Technology on Recipient's personal
notebook computer and on desktop computers at both
Recipient's home and place of business to perform routine
management and engineering work, which will result in costs
and benefits to Recipient and to CSG. The parties mutually
agree that costs and benefits will be offsetting; no
entitlement to payments of any kind will be owed nor
required by either party, including CSG, except as provided
in Section 5 Remedies.
Recipient may further
use the Technology for non-business tasks to "manage" all
daily activity as a comprehensive and integrated schedule
and diary in order to make a full, good faith evaluation of
usefulness and commercial potential for augmenting human
intelligence and memory.
- Use and Disclosure of Confidential Information.
Recipient hereby agrees that it shall use the Confidential
Information set forth in Section 1 solely for the purpose
set forth in Section 2,
above, and that it
will cause its officers, directors, employees and agents to
do the same. Recipient shall disclose the Confidential
Information only to those officers, directors, employees and
agents of Recipient that have a need to know the
Confidential Information and are bound by a similar
obligation of confidence to the Recipient. Except as
expressly allowed herein, Recipient shall not reproduce any
of the Confidential Information and shall not disclose all
or any part of the Confidential Information in any form to
any third party, except as required for the purpose set
forth in Section 2.
- Termination and 6 Month Evaluation Period
The parties agree that technology transfer occurs primarily
through use of the Technology and secondarily through study
of writings by Disclosing Party listed in
The parties desire to provide sufficient time for Recipient to
learn the Technology (including trade secrets) by acquiring
experience using the Technology, as set out in section 3, in
order to evaluate potential for realizing benefits of
financial gain and saving time through greater efficiencies
applying Technology trade secrets set out
in Appendix A,
further to evaluate potential for commercial sales by
attracting customers to such benefits. The parties agree
that six (6) months is a sufficient time for this
evaluation. The parties set the date of February 28, 2004
for this agreement to terminate, if not terminated nor
extended prior to that date. Either party can terminate
this agreement at any time by written or electronic
notification prior to the termination date of February 28,
2004. Upon termination by either party, or when terminated
automatically by default on February 28, 2004, Recipient
shall remove the SDS software program from all computers and
other media, shall return the CD with the SDS program to the
Disclosing Party, and shall continue to abide by the terms
of this confidentiality agreement for a period of fifteen
(15) years from the date of termination, as extended.
- Remedies 5% Royalties on Commercial Gain
Unauthorized use or disclosure by the Recipient of
Confidential Information will diminish the value to
Disclosing Party of the Confidential Information and damage
relationships Disclosing Party has or is developing with
potential investors in the Technology. It is further
understood and agreed that the current valuation of the
Technology based solely on development costs to date is
$5,000,000, and that the potential commercial value of the
technology is much larger. In the event of commercial gain
by Recipient resulting from trade secrets of the Technology
set out in Appendix A,
then for a period of
15 years from the date of Termination of this Agreement, the
Disclosing Party shall be entitled to just compensation,
including royalties of 5% on gross sales. The parties
further understand and agree that money damages would not be
a sufficient remedy for any breach of this Agreement and
that the Disclosing Party shall be entitled to equitable
relief to protect its interest herein, including but not
limited to injunctive relief and specific performance, as
well as monetary damages.
If any provision of this Agreement is declared illegal or
invalid, such provision will be deemed severed, with the
remaining provisions of this Agreement being deemed to
remain in full force and effect.
- Governing Law.
This Agreement shall be governed by and construed in
accordance with the laws of the State of California, except
to the extent preempted by the laws of the United States,
without reference to the conflict of laws provisions of
California law. Any action or proceeding arising out of or
related to this Agreement or its termination shall be
brought in a court located within the City and County of San
Francisco, State of California, and that each of the parties
hereby agree to be subject to service or process in
California, and to submit to the jurisdiction and venue of
- Entire Agreement.
This Agreement constitutes the complete and exclusive
statement of the terms and conditions between the parties
and supersedes any previous agreements pertaining to the
subject matter hereof.
This Agreement may be executed (by original or telecopied
signature) in counterparts, each of which shall be deemed an
original, but all of which taken together shall constitute
but one and the same instrument.
IN WITNESS WHEREOF, the undersigned have executed this
Confidentiality and Nondisclosure Agreement as of the date first
set forth above.
Rod Welch, Individual
By: Rod Welch
Jerry J. Nord, Individual
By: Jerry J. Nord
Appendix A - Technology Description
The Schedule Diary System (SDS) is a software program developed by Rod Welch
(Welch) beginning in 1983 and continues to the present. The
development is generally explained in an SDS record dated July 23, 2000.
SDS extends basic literacy to apply the alphabet in a more powerful way to
augment human memory and intelligence by managing chronology and context. In
recent years, since approximately 1995, popular terminology for summarizing
goals accomplished by SDS are terms like....
Regardless of what any future research may yield, for the purpose of this
Agreement, and as a condition precedent to receiving SDS software, the parties
agree that SDS provides a unique and essential solution for all of foregoing
popular efforts to apply technology, in that no other organization, nor
individual, regardless of claims on these matters, has demonstrated consistent
daily work product that shows ability to perform in the manner that SDS does,
as explained herein.
SDS provides unique and novel technology support for a continuous process
commonly called "intelligence" that integrates time and information management.
Time is managed by a Schedule. Information is managed by a Diary. Combining
schedule and diary reflects the program name: Schedule Diary System (SDS).
Combining time with information management yields a new kind of resource that
leads to a new way of working by capturing a continuous chronology showing
cause and effect of daily events that is organized according to context, and
therefore has the effect of expanding span of attention in a way that cannot be
accomplished by other methods and technologies. SDS uses a flexible organic
structure to index the daily diary record for managing the complexity of
context. For purposes of this agreement the work product of SDS is called
"knowledge" and the SDS "plan, perform, report" process, or recipe, that
integrates time and information is called the SDS "intelligence" process. SDS
records provide a unique flexible structure to externalize human mental metrics
for processing information from daily activity received through sensory
perception, most commonly by seeing and hearing, that yields a continuous
history of life experience supported by a system of memory connected to the
context of human needs.
SDS "records" are the LINK between "Schedule" and "Diary" that implements the
perform, report) to create a flow of knowledge, so that
current tasks are informed by prior experience, which emulates the mental
faculty of integrating time and information.
The parties agree that Recipient has made a thorough investigation investing
such time and resources as deemed necessary, and has determined that no other
technology nor capability of any kind is available from a third party nor is
discussed in the literature as a unified theory of knowledge for augmenting
human intelligence in the manner that SDS supports, and as explained in this
Agreement. The parties further agree that SDS Technology is a fundamental
advance from information technology driven by the subsidiary technology of
"documents," commonly rendered in books, articles, letters and reports, that
are produced using practices of literacy for applying the alphabet. SDS enables
advance to a culture of knowledge based on SDS that expands traditional
alphabet practices to replace the convention of "documents" with a new paradigm
of "Knowledge Space".
Based on the foregoing general explanation, the parties agree that for purposes
of this Agreement the following trade secrets are the sole property of Rod
Welch as the developer of SDS Technology....
on the Internet explain theory and functions that
make SDS unique, and also explain practices using SDS that comprise a
new way of working, forming the management science of Communication
Metrics. Welch retains all rights to intellectual property in these
- SDS integrates time and information to produce knowledge,
explained in POIMS, and other Welch publications listed
under section 1.
SDS support for producing "knowledge" (as defined herein)
is a fundamental advance on
technology for producing information, commonly
called Information Technology or more simply IT. Popular
forms of information technology are conversations,
discussions, meetings, calls,
email, documents, books, magazines,
wordprocessing, Powerpoint presentations and
other video tools like television, movies, radio,
alphabet is an explosive technology
that drives human progress beginning in approximately 700 BC,
reported on November 8, 1999. Alphabet
technology augments human intelligence using a
convention of documents
to create, craft, convey and preserve for continual learning
an external rendering of internal human
thinking commonly called "information." Common rules of
format information for common use that is derived individually in the
mind using cognitive processes for sensory perception, mostly
from sight and sound by seeing, hearing and experiencing daily life,
explained in POIMS. This historical information technology has been
the foundation of civilization, i.e., education, business,
government and science, for approximately 2,000 years.
Modern technology using wordprocessing and spreadsheets
has greatly increased the speed and improved the appearance
of information in documents, but have not advanced the
underlying technology of the alphabet for making connections
that convert data into information, shown by
meeting at a world conference on Information Technology held in
Paris, France, and reported on February 22, 1997.
As a result, mental
cognitive processes that interpret the meaning of information to
construct knowledge are overwhelmed by
information overload, commonly
recognized as limited span of attention. and reported by a CBS News
broadcast on 60 Minutes, reported on April 12, 1998.
SDS advances the tradition of documents produced with common
rules of literacy. An expanded set of rules provides a powerful
for rendering a continual information stream
of chronology, explained on May 23, 1989. This new structure and SDS
enables people to routinely create, craft, convey and preserve
connections of cause and effect based on the evolving
context of human needs. This new construct advances the paradigm of
documents by extending the historical role of information to
provide a new kind of technology that produces
as explained in para 6, below.
Since "knowledge" is a stronger cognitive resource than
information, SDS technology fundamentally lifts the foundation
of civilization, i.e., education, business, government and
science, by augmenting human intelligence beyond the capacity
of ordinary alphabet technology.
The SDS recipe uses a schedule for time management to plan the
future, and a diary report for information management to
understand the past, i.e., history and experience. These
common systems of schedule and diary
are integrated with a unique design for
performing work in the present, so that planning, performing
and reporting yields an
process, explained in POIMS. Integrating the structure of time,
which is commonly rendered by spreadsheet technology, with
information which is commonly rendered by wordprocessing
technology yields a
spreadsheet for knowledge.
SDS tools for a continual, dynamic
"intelligence" process enable people to routinely convert
information into a web of knowledge that connects the dots of
cause and effect to strengthen common business practices
command and control
of daily work, see POIMS.
enables people to quickly and routinely make
and preserve connections of cause and effect in Knowledge
Space for accurate understanding through continual alignment,
explained on April 3, 2000. SDS dynamic linking
expands common legal practices using citations in a fixed
record, to instead verify accuracy and provide context for
understanding causation from chronology, correlations,
implications and nuance of a complex and dynamic record.
SDS provides a consistent method of
storage and retrieval where everything is in the right place
at the right time because
time, subjects and a system of References for
people and documents are integrated to augment the
organizing mechanisms of human intelligence, reported on
July 9, 2000.
SDS uniquely enables a new way of working "intelligently" that
defines a management science of
explained on February 4, 1995. The new work role
complements historical objectives and training in
communication to shape a convincing message, by using SDS for
accurate understanding and timely follow up, commonly called
"listening." The common, historical practices of keeping a
diary and keeping a schedule and keeping business records,
letters and reports are synthesized by SDS into a practical
thinking through writing,
also explained in POIMS,
that expands the common practice of analysis.
SDS technology leverages human mental strength similar to the
way an automobile leverages physical strength, so that more
deliberation can be accomplished to produce more accurate
analysis in less time, leading to the notion of
also explained in POIMS.
The synergy of SDS integrated processes expands the inherent
limits of mental biology on span of attention so that people
can routinely convert information into useful knowledge using
deliberative analysis that adds
explained in POIMS, to organize, analyse, align, summarize
and generate timely feedback that continually refines the
accuracy of understanding from connecting the dots of cause
and effect. Implementing
eight (8) steps
Metrics listed in the record on December 19, 2000,
enables continual learning that makes the rapidly
expanding burden of more information
from discussion, observation, meetings, calls, and documents
produced by email, wordprocessing and spreadsheets an
expanding asset of
for personal and
organizational memory of human experience, as explained in
POIMS, rather than a liability of continual bumbling,
causing loss, conflict, crisis and calamity because information
overwhelms span of attention
due to limited time,
as explained in POIMS.
- Control Fields segment SDS records to identify context based
on organic subject structure that manages information
according to objectives and functions. This emulates human
intelligence that segments information into
chunks of memory
that have multiple subjects and functions for tracking the full
complexity of existence over a lifetime, as set out in
Professor George Miller's
seminal work on cognitive science, reviewed in the record
on March 3, 1999.
For example, a paragraph in SDS of 20 or 100 words can have one
subject, 20 subjects, a hundred subjects that offer multiple views
for understanding the circumstances, correlations, implications and
nuance that impact objectives, requirements and commitments.
Similarly, multiple paragraphs can be segmented according to
context in any convenient manner, i.e., make sentence a segment;
make every paragraph a segment, make several paragraphs a segment,
or make all paragraphs a single segment, depending on the amount of
time available for analysis and the value at risk that
sets priority for allocating time to ensure accurate understanding
and timely follow up. Since the complexity of existence is vastly
greater than the amount of time people have in a lifetime, the
opportunity for improvement that looks like hopeless "overkill"
using information technology, is essentially limitless
The SDS design permits assembling chronologies of information
according to context with a rich pallet of multiple views, and
without commingling unrelated information. It also permits instant
access to the original context, all with the touch of a key. Any
particular SDS memory segment can appear in a variety of contexts,
because the same information has different meaning for different
circumstances, i.e., context.
- Accounting, Cost Control Integrated with Work History
Control Fields also track time expended on subjects and
functions, a field for identifying individuals who expended
the time, and another field for who is chargeable for the time
and cost expended by the work set out in the record.
- Contacts integrated with subjects, accounting, history
SDS records have a flexible structure for identifying Contacts
that shows names, titles, organizations, phone numbers of
individuals discussed in the record, e.g., someone who is
called, or attends a meeting, send them a letter, appears in
There is no limit to the number of contacts that can appear
in the record.
Contact records store generally permanent information about people and
organizations, including account numbers, family members and other
Contacts information is used to automatically generate letterheads in
correspondence and in publishing SDS records, and for addressing
correspondence, including a salutation and closing signature block,
and for posting a document log, and for posting SDS records with a
contact format showing name, organization, title, department, phone
numbers, email address, etc.
Contacts provide a searchable control for assembling SDS records.
- Knowledge Space Augments Alphabet Technology
SDS provides a new environment of
history with current events and subsequent events, plus a
range of control criteria for continual learning and context
management, as explained in POIMS. The rigor
of dimensional space is applied with technology that
data base methods, reported on
August 10, 1991 This combination forms a
spreadsheet for knowledge
to manage the complexity of daily information,
explained on June 20, 1996 and in
Information from traditional documents is connected with
related analysis, and communication into
chronologies of cause
that are organized according to context,
as explained in POIMS.
Knowledge Space is formed using a unique flexible structure that makes
finding everything fast and easy because information is in the right
place for people and organizations based on context managed by
SDS Control Fields
explained in Section 3.
Traditional documents include
formal correspondence logs to manage legal notices issued and
received, including email, books and magazine articles in the public
domain, and memos, spreadsheets and all other forms of information
prepared within an organization.
Integration of "thinking" to organize, analyse, align, summarize and
get feedback, with management systems for people, organizations,
subjects and documents, enables transformation from traditional
reliance on documents to Knowledge Space.
SDS Knowledge Space leverages natural human intelligence by
strengthening the ability to accurately align disparate events, to
maintain alignment, and to retrieve alignment quickly and accurately
over long time spans. Better accuracy necessarily
that occur in natural
cognition from erroneously constructing impressions based on
assembling only the "gist" of complex chronologies showing cause and
effect. as set out on October 10, 1999. In SDS connections remain
stable until expressly changed.
Since alphabet technology is the core capability that empowers
civilization, the SDS advance that improves the alphabet
enhances all forms of knowledge work
by an order of magnitude, similar
to Gutenberg's work cited on October 10, 1999 for advancing
civilization over the past millennium.
- Knowledge Space Fast, Easy to Maintain on Internet
Documents issued and received, including email, can be
converted into HTML for display on the Internet, and links
into the SDS record are added for context.
SDS records are similarly converted for publication on the Internet
and/or a secure intranet with a click of a common mouse. Porting SDS
records and other documents to the Internet provides a connected
environment of Knowledge Space.
Links are verified for uniqueness, to avoid misdirection.
- Organic Subject Structures Organize Information Contextually
SDS has a unique subject indexing system to support Knowledge
Space by creating flexible
objectives and functions, similar to human thinking that
organizes information according to human needs, as explained
SDS tools facilitate creating organic
subject structures, which some
authorities call "ontology," and assigning subjects to SDS records
using Control Fields,
discussed under Section 3.
This emulates human intelligence that
information for fast
retrieval, explained on March 2, 1999.
- SDS records use "intelligence" through the magic of Links
Links are created by double clicking to identify where a link is
needed, and then double clicking again to create the link at the
location initially marked.
Clicking on a link, opens the link.
Clicking on a document listed in References opens the document.
Clicking on an SDS record listed in References opens the record.
Clicking on a subject in a Control Field opens a Subject
Management Index to the subject clicked in the SDS record, for
selection of related subjects.
Clicking between levels of a subject in a control field opens the
Subject Index at the level clicked showing a broader context in the
organic structure of knowledge.
Clicking on a Subject description in an Index enters the subject in a
Clicking on a Subject account locates where in the record the subject
account is entered, or returns a message saying the subject is not
Clicking in front of the subject opens a program to call a report on
Clicking on the subject in the report program opens the Index at the
level of the subject in the report program so that a different but
related subject can be selected for a report.
Clicking between levels in a subject specification in a report program
opens the organic structure Index at the level clicked showing a
broader context, similar to the process for Control Fields
Clicking on Functions instead of Subjects complements or supplements
options for Subjects.
Clicking on the action item section of the Control Field
locates the associated subject if it is listed elsewhere in
the record, and permits further searches to find all
occasions where a subject is used in other Control Fields in
the same record.
Clicking on a document listed in the record, opens the
document. Clicking on the subject description of the document
opens the Subject Index for the subject assigned to the
Clicking on the document type locates where a document is
cited in the record, and permits further searches to find all
occasions where a document is cited.
Clicking on a link anchor finds where a link to the anchor is
located in the record, and permits further searches to find
all links to the target anchor.
Clicking on a Contact in an SDS record opens the contact record.
Clicking on a document listed in a document log opens the document if
the click is to the right of the date field.
Clicking on a document listed in a document log opens the SDS record
showing the history when the document was created, if the click is
within the date field.
- Delivers Anytime, Anywhere Intelligence on the Internet
SDS can transfer records and documents to the Internet that
comprises a unique form of business "intelligence" that is
available anytime, anywhere in the world.
The process of assembling the record, transferring and
maintaining an environment useful for enterprise management is
unique to SDS.
SDS records on the web are the only example of the meaning of
Knowledge Management, and thereon render Knowledge Management
a secret of SDS.
An example is the record on 000425 reviewing research showing that
is a secret of SDS.
- SDS Converts Daily History into Useful Intelligence
Reports with multiple views can be drawn from the SDS record for
decision support on the following criteria....
- Subjects and Functions
- Subjects and Contacts
- Action Items
Reports can be for an individual, several individuals, a
group, a department or an entire organization.
Reports can be in summary or detail format.
Reports always place information in a context of prior and
subsequent events showing cause and effect, including
external sources like books, articles, broadcasts, etc.