EXHIBIT 10.6
EMPLOYMENT AGREEMENT
(XXXXX X. XXXXXX)
This Employment Agreement ("Agreement") is made as of August 15, 1996 (the
"Effective Date"), by and among APPLIED VOICE RECOGNITION, INC., a Delaware
corporation ("Employer") and XXXXX X. XXXXXX, an individual residing in Xxxxxx
County, Texas ("Employee").
W I T N E S S E T H:
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WHEREAS, Employee has been an at will employee of Voice Technologies
Partners, L.P. ("VTPLP");
WHEREAS, as of even date herewith, Employer has acquired certain of the
assets and liabilities of VTPLP;
WHEREAS, Employer and Employee desire to enter into an agreement regarding
Employee's employment with Employer pursuant to the terms and conditions set
forth herein;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and intending to be legally bound
hereby, the parties covenant and agree as follows:
1. EMPLOYMENT. Employer hereby employs Employee and Employee hereby
accepts employment with Employer on the terms and conditions set forth in this
Agreement.
2. TERM OF EMPLOYMENT. The term of Employee's employment hereunder (the
"Term") shall commence as of the Effective Date and shall continue (subject to
termination by either Employer or Employee as hereinafter provided) for an
initial term (the "Initial Term") expiring on December 31, 1999 (the "Expiration
Date"). The Expiration Date shall be automatically extended, unless terminated
by Employer or Employee for successive one (1) year periods following the
expiration of the Initial Term. If Employer desires to terminate Employee's
employment under this Agreement at the end of the Initial Term or at the end of
any succeeding one year term, Employer shall give written notice of such desire
to Employee at least six (6) months prior to the expiration of the Initial Term
or any succeeding one year term. If Employee desires to terminate Employee's
employment under this Agreement at the end of the Initial Term or at the end of
any succeeding one year term, Employee shall give written notice of such desire
to Employer at least three (3) months prior to the expiration of the Initial
Term or any succeeding one year term. At the expiration of the then existing
term, Employer shall have no further obligation to Employee except as set forth
in Section 6(c), and Employee shall have no further obligation to Employer
except as set forth in Section 7.
3. COMPENSATION AND OTHER BENEFITS.
(a) As compensation for all services rendered by Employee in
performance of her duties or obligations under this Agreement, Employer
shall pay Employee the following annual base salary:
(1) during the remainder of 1996, based on an annual salary of
SIXTY THOUSAND AND NO/100 DOLLARS ($60,000.00);
(2) during 1997 and thereafter as adjusted in accordance with
this Section 3, NINETY THOUSAND AND NO/100 DOLLARS ($90,000.00); and
(during any particular period, the "Base Salary"), payable in qual semi-
monthly installments or in the manner and on the timetable which Employer's
payroll is customarily handled or at such intervals as Employer and
Employee may hereafter agree to from time to time. Employer and Employee
agree that the Base Salary shall be adjusted annually on January 1 of each
year, commencing January 1, 1998, to reflect the increase, if any, in the
cost-of-living. The adjustment shall be made by adding to such Base Salary
an amount obtained by multiplying the Base Salary by the percentage by
which the level of the Consumer Price Index for the Houston, Texas
Metropolitan Area as reported on the last day of the preceding calendar
year by the Bureau of Labor Statistics of the United States Department of
Labor, has increased over its level as of December 31, 1997. Following the
end of each calendar year after December 31, 1997, and within thirty (30)
days after the release by the Bureau of Labor Statistics of the figures for
the preceding year, Employer shall pay to Employee the amount of additional
compensation to which she is entitled on account of the cost-of-living
adjustment made to the Employee's salary. In no event shall the Base
Salary ever be decreased as a result of a decrease in the cost-of-living.
(b) In addition to receiving the Base Salary provided for in Section
3(a), Employee shall be entitled during the Term, upon satisfaction of all
eligibility requirements, if any, to participate in all health, dental,
disability, life insurance and other benefit programs now or hereafter
established by Employer which cover substantially all other of Employer's
employees and shall receive such other benefits as may be approved from
time to time by Employer.
(c) Employee shall be entitled to receive three (3) weeks of paid
vacation for each year during the Term and shall be entitled to receive
paid holidays as enjoyed by all other employees of Employer.
4. DUTIES. Employee is employed to act as Vice President and Secretary
of Employer, at least until calendar year 1999 as a member of the Board of
Directors of Employer, and in such other office or position as shall be assigned
to Employee from time to time by Employer, and to perform such duties as are
commensurate with Employee's position with Employer. Employee agrees that
Employee shall devote a substantial portion (but not all) of her time to as an
employee of
Employer, shall use Employee's best efforts to perform the duties of
Employee's position in an efficient and competent manner and shall use
Employee's best efforts to promote the interests of Employer and any affiliated
companies. Employee further agrees that Employee shall refer to Employer all
opportunities in the computer industry related to voice recognition software
designs and applications to which Employee might become exposed in carrying out
Employee's duties and responsibilities hereunder.
5. PARTICIPATION IN EMPLOYER'S STOCK OPTION PLAN. As an additional
inducement to Employee to accept employment upon the terms set forth herein and
in consideration of her execution of this Agreement, Employee shall be entitled
to participate in Employer's 1996 Stock Option Plan, as described in that
certain document entitled "APPLIED VOICE RECOGNITION, INC. 1996 STOCK OPTION
PLAN", as amended from time to time.
6. TERMINATION OF EMPLOYMENT.
(a) Employee's employment pursuant hereto shall terminate in the event
of the death of Employee.
(b) Employer may terminate Employee's employment under this Agreement
for cause without any prior notice, upon the occurrence of any of the
following events;
(1) any embezzlement or wrongful diversion of funds of Employer
or any affiliate of Employer by Employee;
(2) gross malfeasance by Employee in the conduct of her duties;
(3) material breach of Section 7 of this Agreement;
(4) the failure by Employee on account of a medical disability to
substantially perform Employee's duties of employment and achieve
expected customary results for a period of one hundred eighty (180)
days and the finding by Employer, in the exercise of its reasonable
discretion, that Employee will not be able to substantially perform
her duties for at least a period of an additional one hundred eighty
(180) days during the term of this Agreement; or
(5) gross neglect by Employee in carrying out Employee's duties.
(c) If Employee's employment is terminated for any of the reasons
specified in Section 6(a) or (b) or if Employee should voluntarily
terminate Employee's employment, Employer shall no longer be obligated to
make the payments specified under Section 3 or to pay to Employee any other
compensation or benefits whatsoever, except as may otherwise be provided in
Section 6(d). Notwithstanding the foregoing, if for any reason Employee's
employment is terminated hereunder, any salary payable under Section 3(a)
which shall have
been earned but not yet paid shall be paid by Employer to Employee or
Employee's estate, as the case may be.
(d) Employee shall have the right to terminate Employee's employment
hereunder upon ninety (90) days' notice to Employer after the occurrence of
any of the following events:
(1) a sale of all or substantially all of the assets of Employer
to a third party for which Employee does not continue in employment;
or
(2) a merger or consolidation of Employer with an entity for
which Employee does not continue in employment.
The foregoing provision of this Section 6(d) shall not apply if the change
of ownership that would otherwise trigger Employee's termination right is caused
by the registration by Employer or Employer's successor, of any class of equity
securities pursuant to Section 12 of the Securities Exchange Act of 1934, as
amended, or the merger of Employer or Employer's successor into a public shell.
7. DISCLOSURE OF CONFIDENTIAL INFORMATION. During the Term and at all
times thereafter, Employee shall use Employee's best efforts and shall take all
reasonable precautions to prevent the disclosure, except to the extent required
in the performance of Employee's duties or obligations to Employer hereunder or
by express prior written consent of a duly authorized officer or director of
Employer (other than Employee), of trade secrets, secret methods or
"Confidential Information" of Employer. As sued herein, the term "Confidential
Information" means any and all information relating directly or indirectly to
Employer that is not generally ascertainable from public or published
information or trade sources and that represents proprietary information to
Employer, excluding, however, (i) Employees' business contracts, (ii)
information already known to Employee prior to Employee's employment with
Employer, and (iii) information required to be divulged in any legal or
administrative proceeding in which Employee is involved.
Employer agrees that during the term of this Agreement, Employee will be
granted access to Employer's Confidential Information, including specifically
without limitation customer lists, pricing lists, existing customer contracts,
customer correspondence and technical specifications relating to Employer's
products, procedures and methods, to the extent access to such Confidential
Information is reasonably necessary to the performance of Employee's duties
under this Agreement.
Upon the expiration or earlier termination of this Agreement for any
reason, Employee shall immediately return to Employer any and all Confidential
Information in Employee's possession or control, including, but not limited to,
any originals or copies of, or computer discs or other magnetic media containing
policies, procedures, customer lists, pricing lists, customer correspondence, or
billing information. Employee shall to retain any Confidential Information in
any form (e.g., computer hard drive, microfilm, etc.) upon the expiration or
earlier termination of this Agreement.
8. ARBITRATION. The parties agree that all disputes or questions arising
in connection with this Agreement and/or the termination of Employee's
employment hereunder shall be settled by a single arbitrator pursuant to the
rules of the American Arbitration Association in the City of Houston, Texas, and
the award of the arbitrators shall be final, conclusive and enforceable in a
court of competent jurisdiction; provided, however, notwithstanding the
foregoing, in no event shall any dispute, claim or disagreement arising under
Section 6 of this Agreement that requires injunctive or other equitable relief
be required to be submitted to arbitration pursuant to this provision or
otherwise.
9. NOTICES. Any notice, request, reply, instruction, or other
communication provided or permitted in this Agreement must be given in writing
and may be served by hand delivery or by depositing same in the United States
mail in certified or registered form, postage prepaid, return receipt requested.
If to Employer, at: Applied Voice Recognition, Inc.
0000 Xxxx Xxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Chairman of the Board
or, if to Employee, at: Xx. Xxxxx X. Xxxxxx
0000 Xxxx Xxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
with a copy in all instances to: Xxxxx, Xxxxx & Xxxxxx
0000 Xxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: J. Xxxxxxx Xxxxx, Esq.
or to such other address as may be specified in a notice given in accordance
with this Section. Unless actual receipt is required by any provision of this
Agreement, notice delivered by hand in the manner herein prescribed shall be
effective upon receipt by the addressee and notice deposited in the Untied
States mail in the manner herein prescribed shall be effective three (3)
business days after deposit.
10. SEVERABILITY. If any provision of this Agreement is rendered or
declared illegal or unenforceable by reason of any existing or subsequently
enacted legislation or by decree of a court of last resort, Employer and
Employee shall promptly meet and negotiate substitute provisions for those
rendered or declared illegal or unenforceable, but all the remaining provisions
of this Agreement shall remain in full force and effect.
11. ASSIGNMENT. This Agreement may not be assigned by any party without
the prior written consent of the other parties.
12. BINDING AGREEMENT. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto, and their respective legal
representatives, heirs, successors and permitted assigns.
13. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
14. ATTORNEYS FEES. In the event of any dispute between the parties
regarding this Agreement, the prevailing party shall be entitled to be
reimbursed for its or her attorneys fees by the non-prevailing party.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
EMPLOYER:
APPLIED VOICE RECOGNITION, INC., a Delaware
corporation
By: /S/ XXXXXXX X. XXXXXXXX
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Xxxxxxx X. Xxxxxxxx,
President
EMPLOYEE:
/S/ XXXXX X. XXXXXX
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XXXXX X. XXXXXX
