Attached files
| file | filename |
|---|---|
| 10-Q - Vu1 CORP | v203594_10q.htm |
| EX-32.1 - Vu1 CORP | v203594_ex32-1.htm |
| EX-31.2 - Vu1 CORP | v203594_ex31-2.htm |
| EX-31.1 - Vu1 CORP | v203594_ex31-1.htm |
EXECUTIVE
EMPLOYMENT AGREEMENT
This
Executive Employment Agreement is entered into as of October 4, 2010 (the “Effective Date”) by and
between Vu1 Corporation, a California corporation (the “Company”), and Philip Styles
(“Executive”).
1. Employment. The
Company hereby employs Executive and Executive hereby accepts employment by the
Company as its Chief Executive Officer. The Executive shall perform
such executive and managerial duties and responsibilities customary to his
office and as are reasonably necessary to the operations of the Company and as
may be assigned to him from time to time by or under authority of the Board of
Directors of the Company (the “Board”). Executive
shall report to the Board.
As a
condition to the effectiveness of this Agreement, concurrently with this
Agreement, Executive shall execute and deliver the Company Nondisclosure,
Invention Assignment, Noncompetition and Nonsolicitation Agreement in the form
attached hereto as Exhibit A, which is
part of this Agreement.
2. Term. Unless
earlier terminated by either party, the term of this Agreement shall be for 12
months, terminating at midnight October 3, 2011.
3. Compensation. During
the term of this Agreement, the Company shall pay or cause to be paid to
Executive, and Executive shall accept in exchange for the services rendered
hereunder by him, the following compensation:
(a) Base
Salary. Executive’s compensation shall consist of, in part, an
annual base salary (the “Base
Salary”) of $240,000 before all customary payroll
deductions. The Base Salary shall be paid to Executive in
substantially equal installments and at the same intervals as other executives
of the Company are paid, at a minimum of one payment per calendar month. At the
option of the Board, the compensation may be converted to stock at the current
stock price on the day the agreement is signed by the Executive.
(b) Stock Option
Compensation. Executive shall be granted an option to purchase
1,000,000 shares of common stock which vests in equal monthly amounts through to
October 3, 2011. The option grants described above shall have a life
of 10 years from October 4, 2010 and be issued from the 2007 Stock Compensation
Plan with the exercise price equal to the closing market price of the common
stock on October 4, 2010.
(c) Performance Incentive Compensation.
Executive shall be entitled to compensation based on a performance bonus
for achieving major milestones of growth, manufacturing, revenue and performance
of the company. These goals shall be determined by the board of directors as
part of the agreed upon strategic plan and budget goals and could include such
items as: 1) raising adequate capital levels on terms acceptable to the board
and in the best interest of shareholders; 2) achieving technology milestones
that allow completion of ESL technology for 3rd party
testing and manufacturing bulbs for sale; and 3) achieving revenue targets for
the company into defined distribution channels in the U.S. and internationally.
Executives’ performance incentive compensation shall be decided and awarded no
later than October 4 of 2011, or within one month after termination of agreement
by either party.
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(d) The board
at its sole discretion may award Executive a cash performance bonus up to half
the base compensation which executive may elect to convert to a grant of common
stock at closing stock price on day cash bonus is offered.
4. Benefits.
(a) Health
Benefits. During the term of this Agreement, and pending the
Company’s ability to begin a health insurance plan, the Company shall provide
Executive with the family coverage health insurance provided to other senior
executives and Executive will be entitled to participate, subject to and in
accordance with applicable eligibility requirements, in fringe benefit programs
as shall be provided from time to time by, to the extent required, action of the
Board (or any person or committee appointed by the Board to determine fringe
benefit programs).
(b) Business
Expenses. Executive shall be reimbursed for all reasonable
business expenses according to the Company’s standard practices for expense
reimbursement. The Executive, as a condition precedent to obtaining
such payment or reimbursement, shall provide to the Company any and all
statements, bills or receipts evidencing the travel or out-of-pocket expenses
for which the Executive seeks payment or reimbursement, and any other
information or materials, as the Company may from time to time reasonably
request.
(c) Vacation. During
the term of this Agreement, Executive shall be entitled to 20 days paid
vacation. Executive agrees that no more than 10 days vacation will be used
consecutively without prior consent of the Company. Unused vacation time may be
accrued during the term of this Agreement, but in no event shall Executive
accrue and carry over more than 10 days of paid vacation. Any unused
vacation time above the amount that may be carried over shall be paid in
cash.
5. Payments
and Benefits Upon Termination.
(a) Voluntary Resignation by Employee or
Termination for Cause by the Company. Following termination of
Executive’s employment by Executive or by the Company for Cause (as defined
below), Company shall pay Executive salary due and owing as of the Executive’s
last day of Employment, plus any accrued but unused vacation, less standard
deductions, and shall reimburse Executive for any outstanding
expenses. If Executive voluntarily resigns, dies, is Disabled or is
terminated by the Company for Cause, then Executive will not be entitled to any
compensation provided by Section 6(b).
(b) Termination Without Cause or
Following a Change of Control. Upon termination of Executive’s
employment by the Company (i) for any reason other than Cause (as defined
below) or (ii) on or within 180 days after a Change of Control by the Company of
Executive, and in each case provided that the Executive signs a release of all
claims or potential claims against the Company, the Company shall pay Executive
six months of Executive’s annual Base Salary in effect immediately prior to the
date of Executive’s termination (the “Cash Severance”), payable in
lump sum or, provided appropriate escrow or means of guaranteeing availability
of funds, on the Company’s regularly scheduled pay day(s). All
payments under this Section 6 are subject to applicable federal and state
payroll withholding or other applicable taxes. In addition, any and
all stock options in Section 4 or granted subsequent to this Employment
Agreement that are not vested as of the date of termination shall
vest immediately and become exercisable effective with the date of
termination.
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(c) “Cause”
Definition. For purposes of this Agreement, “Cause” means, in the Company’s
sole determination using reasonable standards, the occurrence of any of the
following: (i) the Executive's refusal to perform, or
Executive’s gross misconduct or negligence in the performance of, his duties and
responsibilities as Chief Executive Officer, or the breach by Executive of any
provision of this Agreement, but in each case, any occurrence of “Cause” under
this subsection 6.(c)(i) will exist only if Executive has received first written
notice of the alleged misconduct, negligence, or breach and has not performed
the duties or responsibilities or cured the alleged breach within the 30-day
period following Executive’s receipt of the notice; (ii) violation by
Executive of a state or federal law, rule or regulation involving the commission
of a crime against the Company (including violation of any statutory or common
law duty of loyalty to the Company) or that is potentially materially injurious
to the Company, or any felony or any crime involving moral turpitude, dishonesty
or theft; (iii) any act of misconduct, theft, misappropriation of Company
property, moral turpitude, fraud, intentional misrepresentation, bad faith or
dishonesty by Executive; (iv) any act by Executive that substantially materially
injures or could reasonably be expected to substantially materially injure the
business or business relationships of the Company; or (vi) Executive’s
inability to perform his duties because of sickness or injury for more than 30
consecutive days.
(d) “Change of Control”
Definition. For purposes of this Agreement, “Change of Control” shall mean
the occurrence of any of the following events: (i) the
consummation of the sale or disposition by the Company of all or substantially
all the Company’s assets in one or a series of related transactions; or
(ii) the consummation of a merger or consolidation of the Company or share
exchange involving any other corporation, other than (A) a merger,
consolidation or share exchange which would result in the voting securities of
the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities of
the surviving entity) at least fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation, or (B) a merger
effected solely for purposes of changing the domicile of the
Company.
4. Indemnification. Company will
indemnify, to the fullest extent permissible by applicable law as then in
effect, and defend Executive against charges or claims brought against company
or Executive in normal course of duties with Vu1 Corporation, provided that
Executive gives written notice to the Company promptly after Executive has
actual knowledge of any proceeding as to which indemnification may be sought
under this Agreement. In no event shall the Company indemnify
Executive: (a) from or on account of any act or omission of
Executive adjudged to be intentional misconduct or a knowing violation of law;
(b) from or on account of any act or omission of Executive as to which Executive
did not (x) act in good faith and (y) in a manner Executive reasonably
believed (i) in the case of conduct in Executive’s official capacity with the
Company, to be in the best interests of the Company, and (ii) in all other
cases, at least not opposed to the best interests of the Company, and with
respect to any criminal proceeding, Executive had no reasonable cause to believe
Executive’s conduct was unlawful, which determination shall be made in
accordance with RCW 23B.08.550 or by a court of competent jurisdiction; (c) from
or on account of any conduct of Executive adjudged to be in violation of RCW
23B.08.310 (as may hereafter be amended or supplemented); (d) from or on account
of any transaction with respect to which it is adjudged that Executive
personally received a benefit in money, property, or services, to which
Executive was not legally entitled; (e) in connection with any proceeding
initiated by Executive against the Company or any director or officer of the
Company unless the Company has joined in, or the Board of Directors has
consented to, the initiation of such proceeding, or the proceeding is one to
enforce indemnification rights under this Agreement or any applicable law; or
(f) to the extent Executive settles or otherwise disposes of a proceeding,
or causes the settlement or disposal of a proceeding, without the Company’s
express prior written consent (which consent shall not be unreasonably
withheld), unless Executive receives court approval for such settlement or other
disposition where the Company had the opportunity to oppose Executive’s request
for such court approval.
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6. Governing Law;
Venue. This Agreement shall be governed by and construed in
accordance with the laws of the state of Washington applicable to contracts made
and to be performed there without giving effect to the principles of conflicts
of law. The parties hereby consent and agree that the federal or
state courts of the State of Washington (located in Seattle, Washington) will
have jurisdiction to hear, determine, and enforce any claims or disputes arising
out of or related to the provisions of this Agreement.
7. Arbitration and/or Attorneys’
Fees. Any
controversy or claim arising from, out of or relating to this Agreement, or the
breach hereof (other than controversies or claims arising from, out of or
relating to the provisions in Exhibit A), shall be determined by final and
binding arbitration in Seattle, Washington, in accordance with the Employment
Dispute Resolution Rules of the American Arbitration Association, by a panel of
not less than three (3) arbitrators appointed by the American Arbitration
Association. The decision of the arbitrators may be entered and enforced in any
court of competent jurisdiction be either the Company or the
Executive.
The
Parties indicate their acceptance of the foregoing arbitration requirement by
initialing below.
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/s/ Mark Weber
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/s/ Philip Styles
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For
the Company
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For
the Executive
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The
substantially prevailing party in any arbitration litigation or similar
proceeding shall be entitled to recover from the other party all costs and
expenses, including reasonable attorneys’ fees and disbursements, in connection
with such litigation, arbitration or similar proceeding.
8. Amendments; Waiver;
Cure. No amendment, waiver or modification in whole or in part
of this Agreement, or any term or condition of this Agreement, shall be
effective unless in writing and duly signed by the party sought to be
bound. Any waiver of any breach of any provision hereof or any right
or power by any party on one occasion shall not be construed as a waiver of, or
a bar to, the exercise of such right or power on any other occasion or as a
waiver of any subsequent breach.
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9. Binding Effect;
Successors. This Agreement shall be binding upon, inure to the
benefit of and be enforceable by the Company and Executive and their respective
heirs, legal representatives, successors and assigns.
EXECUTED
by the parties on date above:
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EXECUTIVE:
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/s/ Philip Styles
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Philip
Styles
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COMPANY:
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VU1
CORPORATION
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By:
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/s/ Mark Weber
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Name:
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Mark
Weber
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Title:
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Director
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Exhibit
A
Form
of Executive Nondisclosure, Nonsolicitation And
Invention
Assignment Agreement
This
Executive Nondisclosure, Nonsolicitation and Invention Assignment Agreement
Nondisclosure and Invention Assignment Agreement (“Agreement”) is entered into by
and between the individual referenced on the signature page (“Executive”) and Vu1
Corporation, a California corporation (the “Company”).
The
parties agree as follows:
1. Confidentiality. Executive
recognizes that during the course of employment with the Company, Executive will
have access to certain Confidential Information (as defined below) relating to
the business of the Company. Executive agrees that all Confidential
Information shall remain the exclusive property of the Company.
At all
times during or following Executive’s employment with the Company, Executive
agrees not to disclose to anyone outside the Company, nor to use for any purpose
other than Executive’s work for the Company, (i) any Confidential Information or
(ii) any information the Company has received from others which Executive knows
the Company is obligated to treat as confidential or proprietary.
2. Definition of Confidential
Information. “Confidential Information”
means any information or material in which the Company has rights, whether or
not owned or developed by the Company, which is not generally known other than
by the Company, and which Executive may obtain knowledge of through or as a
result of the employment relationship established with the Company.
Without
limiting the foregoing, Confidential Information includes: (a) any
and all information in which the Company has rights relating to the invention,
design and development of the Company’s products and any other proprietary
technical information of the Company that is not generally known other than by
the Company; and (b) any and all business plans, marketing techniques and plans,
financial materials, cost data, customer lists, vendor lists, pricing policies
and other proprietary business information of the Company that is not generally
known other than by the Company.
Confidential
Information will not include information that (i) Executive lawfully obtains
from any third party who has lawfully obtained such information; (ii) is
generally available to the public or is later published or generally disclosed
to the public by the Company; or (iii) was already known to or in possession of
Executive prior to disclosure by the Company.
3. Inventions, Copyrights and
Patents. The Company owns all Inventions and Works (as defined
below) that Executive makes, conceives, develops, discovers, reduces to practice
or fixes in a tangible medium of expression, alone or with others, either (a)
during the term of Executive’s employment by the Company (whether or not during
working hours), or (b) within 12 months after Executive’s employment ends if the
Invention or Work is derived from or relates to any work Executive performed for
the Company or involves the use or assistance of the Company’s facilities,
materials, personnel or Confidential Information. The Company also
owns all Inventions and Works that Executive brings to the Company that are used
in the course of the Company’s business or that are incorporated into any
Inventions or Works that belong to the Company.
A-1
Executive
will promptly disclose to the Company, hold in trust for the Company’s sole
benefit, and assign to the Company and hereby assigns exclusively to the Company
all Executive’s right, title, and interest in and to any and all Inventions and
Works. Executive hereby waives any and all claims of any nature
whatsoever that Executive now or hereafter may have for infringement of any
patent resulting from any patent applications for any
Inventions. Executive agrees that all Works shall be considered
“works made for hire” so that the Company will be considered the author of the
Works under the federal copyright laws. At the Company’s direction
and expense Executive will execute all documents and take all actions necessary
or convenient for the Company to give effect to the assignment to, and vesting
of ownership in, the Company of all Inventions and Works. The Company
shall have full control over all applications for patents or other legal
protection of Inventions and Works.
“Inventions” means discoveries,
developments, concepts, ideas, improvements to existing technology, processes,
procedures, machines, products, compositions of matter, formulae, algorithms,
software, computer programs and techniques, and all other matters ordinarily
intended by the word “invention,” whether or not patentable or copyrightable,
including all copyrights (including renewal rights), patent rights and trade
secret rights, vested and contingent. “Inventions” also includes all
records and expressions of those matters. “Works” means original works of
authorship, including interim work product, modifications and derivative works,
and all similar matter, whether or not copyrightable.
Except as
expressly provided herein, “Inventions” or “Works” shall not include inventions
or works for which no equipment, supplies, facilities or trade secret
information of the Company was used and which were developed entirely on
Executive’s own time, unless (a) the invention or work relates directly to the
Company’s actual or demonstrably anticipated business, or (b) the invention or
work derives from or relates to any work Executive performed for the
Company.
4. Reverse
Engineering. Executive agrees that Executive will not engage,
nor cause any other person, firm, corporation or other entity to engage, in the
reproduction of Confidential Information, Inventions or Works through the
techniques of “reverse engineering” as described in Title 17, United States
Code, Section 906, as such statute may be amended from time to
time.
5. Return of
Materials. At the time Executive leaves the employ of the
Company, or sooner at the request of the Company, Executive shall return all
papers, drawings, notes, memoranda, manuals, specifications, designs, devices,
documents, diskettes, tapes, prototypes and products, and any other material on
any media containing or disclosing any confidential or proprietary technical or
business information, except for any documents or other materials received as a
shareholder of the Company, this Agreement, the Executive Employment Agreement
and any other Company documents describing or setting forth Executive’s rights
to compensation or benefits from the Company. Executive shall also
return any keys, pass cards, identification cards, or other property belonging
to the Company.
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6. Non Competition with the
Company. While employed by the Company and for 12 months after
employment ends, regardless of the reason it ends, Executive shall not do work
that competes with or relates to any of the Company’s products or activities
without first obtaining the Company’s written permission. Any
business opportunities related to the Company’s business that Executive learns
of or obtains while employed by the Company (whether or not during working
hours) belong to the Company, and Executive shall pursue them only for the
Company’s benefit.
7. Disclosure of New
Work. Before Executive undertakes any work for any other party
during employment by the Company or within 12 months after employment ends that
will involve subject matter related to the Company’s activities, Executive shall
fully disclose the proposed work to the Company.
8. Nonsolicitation. So
long as Executive is employed by the Company and for 12 months after employment
ends, regardless of the reason it ends, Executive shall not directly or
indirectly (a) solicit any employee or executive to leave his or her employment
with the Company or (b) solicit business from clients, customers or account
holders of the Company that is substantially similar to the business then
conducted by the Company. For purposes of the foregoing, Executive
shall not do any of the following: (i) disclose to any third
party the names, backgrounds or qualifications of any Company employees or
executives or otherwise identify them as potential candidates for employment;
(ii) personally or through any other person, approach, recruit or otherwise
solicit employees or executives of the Company to work for any other employer;
(iii) participate in any pre-employment interviews with any person who was
employed by the Company during the term of this Agreement; (iv) disclose to
any third party the names, background or any information about any Company
clients, customers or account holders, or otherwise identify them as potential
sources of business; (v) personally or through any other person, approach
or otherwise solicit clients, customers or account holders of the Company as
potential sources of business. The term “solicit” or “solicitation”
or the like does not include general advertisements or other solicitations to
the general public.
9. No Conflicting
Agreements. Except for obligations to former employers,
Executive is not a party to any agreements, such as confidentiality agreements,
or assignment of invention agreements, with any other party except for those
disclosed to the Company in writing prior to the execution of this
Agreement. No agreement with a former employer prohibits Executive
from being employed by the Company.
10. Trade
Secrets. Executive acknowledges that disclosure or use of a
trade secret without express or implied consent violates the Uniform Trade
Secrets Act. RCW 19.108.010. Executive acknowledges that the Company is not
seeking to obtain such trade secrets and agrees not to improperly disclose trade
secrets to the Company.
11. Injunctive
Relief. Executive acknowledges that any violation of this
Agreement by Executive will cause irreparable injury to the Company and the
Company shall be entitled to extraordinary relief in court, including, but not
limited to, temporary restraining orders, preliminary injunctions, and permanent
injunctions, without the necessity of posting bond or security. Executive consents to
the Company notifying anyone to whom Executive may provide services of the
existence and terms of this Agreement.
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13. Severability. To
the extent that any provision of this Agreement shall be determined to be
invalid or unenforceable, such provision shall be deleted from this Agreement,
and the validity and enforceability of the remainder of this Agreement shall be
unaffected. In furtherance of, and not in limitation of, the
foregoing, it is expressly agreed that, should the duration or geographical
extent of, or the business activities covered by this Agreement be finally
determined to be in excess of that which is valid or enforceable under
applicable law, such provision shall be construed to cover only that geography,
duration, extent, or activities that may validly or enforceably be covered.
Executive acknowledges the uncertainty of the law in this respect and expressly
stipulates that this Agreement shall be construed in a manner which renders its
provisions valid and enforceable to the maximum extent (not exceeding its
express terms) possible under applicable law.
14. Governing Law;
Venue. This Agreement shall be governed by and construed in
accordance with the laws of the state of Washington applicable to contracts made
and to be performed there without giving effect to the principles of conflicts
of law. After consultation with its independent counsel, Executive
expressly acknowledges that (a) the parties could have elected California law as
the law that would govern this Agreement, and (b) California law may be
more favorable to Executive in certain material respects than Washington
law. Notwithstanding the foregoing, Executive and the Company have
specifically bargained for this Agreement to be governed by Washington law
(without giving effect to the principles of conflicts of law). The
parties hereby consent and agree that the federal or state courts of the State
of Washington (located in Seattle, Washington) will have jurisdiction to hear,
determine, and enforce any claims or disputes arising out of or related to the
provisions of this Agreement.
14. Miscellaneous. The
substantially prevailing party in any litigation brought under the terms of this
Agreement shall be entitled to an award of reasonable costs and expenses of
litigation and any appeal, including reasonable attorneys’
fees. Executive’s obligations under this Agreement supplement and do
not limit other obligations Executive has to the Company, including without
limitation under the law of trade secrets. This Agreement shall be
enforceable regardless of any claim Executive may have against the
Company. If any provision of this Agreement is held to be
unenforceable as written, it shall be enforced to the maximum extent allowed by
applicable law. If any provision of this Agreement is void or is so
declared, such provision shall be severed from this Agreement, which shall
otherwise remain in full force and effect. This Agreement shall
survive termination of Executive’s employment, however caused. This
Agreement is the final and complete expression of the parties’ agreement on
these subjects, and may be amended only in a writing signed by the Company and
Executive.
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DATED
this ___ day of November, 2010.
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EXECUTIVE:
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Philip
Styles
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COMPANY:
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VU1
CORPORATION
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By:
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Name:
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Mark
Weber
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Title:
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Director
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