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Exhibit 10.7
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, dated as of January 29, 1999, by and
between, Medsite Publishing, a Delaware corporation, with an address at 00 Xxxx
00xx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Company"), and Xxxxxx
Xxxxxxx, an individual with an address at 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX
00000 (the "Executive").
W I T N E S S E T H:
WHEREAS, the Executive is currently employed by the Company and is
responsible for sales;
WHEREAS, the Company and the Executive desire to express the terms and
conditions of the employment by the Company of the Executive as Vice President
of the Company; and
WHEREAS, the purchasers of Class A Redeemable Convertible Participating
Preferred Stock of the Company have requested, and it is a condition precedent
to the consummation of their investments, that the Company and Executive enter
into this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged by the parties hereto, the parties hereto hereby
agree as follows:
1. Employment. The Company hereby agrees to employ the Executive, and
the Executive hereby accepts and agrees to such employment, commencing as of the
date hereof, upon the terms and conditions hereinafter set forth.
2. Term. The term of the Executive's employment under this Agreement
shall commence as of the date hereof and shall continue for a period of two (2)
years from the date hereof, unless sooner terminated as provided elsewhere in
this Agreement (the "Initial Term"). The Initial Term hereof will be
automatically renewed for additional terms (each a "Renewal Term," and,
together, with the Initial Term, collectively the "Term") of one (1) year unless
either party hereto provides the other party hereto written notice of its
election not to renew this Agreement ninety (90) days prior to the expiration of
the Initial Term, or, if applicable, ninety (90) days prior to the expiration of
any Renewal Term.
3. Duties and Services. (a) The Executive agrees, from and after the
date hereof, to serve the Company faithfully, diligently and to the best of his
ability, subject to and under the direction and control of the president and
chief executive officer of the Company, as its Vice President, with primary
responsibility for sales. The Executive shall devote his entire business time,
energy and skill to such activities on behalf of the Company; provided, however
that this Agreement shall not be interpreted to prohibit the Executive from
making passive personal investments in publicly traded companies comprising less
than 5% of any class
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thereof, if those activities do not contravene the provisions of Section 9
hereof and do not interfere with the duties required of the Executive under this
Agreement.
(b) The Executive agrees to perform such other services as the
Company shall reasonably request, and to act in such capacities for the Company
and its Affiliates (as hereinafter defined), including serving as a director
and/or officer of any thereof, as may be designated by the Board of Directors of
the Company, without further compensation other than that for which provision is
made in this Agreement. For purposes of this Agreement, the term "Affiliate"
shall refer to any entity which controls, is controlled by, or is under common
control with the Company.
4. The Company's Assistance to the Executive. The Company shall supply
the Executive with all materials, data and technical assistance which shall be
reasonably necessary to assist the Executive. Such materials and the contents
thereof and all intellectual property referenced or represented therein shall
remain the property of the Company.
5. Compensation. (a) During the Term, the Company agrees to pay to the
Executive, and the Executive agrees to accept, a salary for all his services
(the "Salary") at the rate set forth on Table A hereto, payable in accordance
with the Company's standard payroll policies from time to time.
(b) During the Term, the Company agrees to pay to the
Executive an annual bonus, determined in the sole discretion of the Compensation
Committee of the Board of Directors of the Company with the maximum bonus
potential being 25% of Salary.
(c) The Executive agrees that the Company shall withhold from
any and all payments required to be made to the Executive pursuant to this
Agreement (including the travel allowance) all federal, state, local and/or
other taxes which are required to be withheld in accordance with applicable
statutes and/or regulations from time to time in effect.
6. Employee Benefits. (a) In accordance with the policies of the
Company, the Company shall reimburse the Executive for his reasonable business
expenses incurred by him for or on behalf of the Company in furtherance of the
performance of his duties hereunder. Such reimbursement shall be subject to
receipt by the Company from the Executive of an itemized accounting therefor,
together with such vouchers and other reasonable verifications as the Company
shall require to satisfactorily evidence such expenses, and such policies as the
Company shall establish from time to time.
(b) The Executive shall be entitled to participate, in
accordance with the terms thereof, in employee benefit plans maintained for the
executives of the Company, including, without limitation, any health,
hospitalization and medical insurance programs and in any pension or retirement
or other similar plans or policies. The foregoing shall not be construed to
require the Company to establish any such plans, or to prevent the Company from
modifying or terminating any such plans once established. The Executive shall be
entitled to the vacation, benefits and sick days set forth on Table A hereto.
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7. Termination. (a) Notwithstanding anything to the contrary contained
herein, the Company's employment of the Executive under this Agreement and the
Executive's right to any and all compensation to which the Executive would
otherwise be entitled hereunder, shall terminate upon the earliest to occur of
the following events:
(i) The death of the Executive.
(ii) The permanent disability (as hereinafter defined) of
the Executive.
(iii) The non-renewal and expiration of the Term of
hereunder pursuant to Section 2 hereof.
(iv) Upon written notice to the Executive from the
Company for Cause (as hereinafter defined).
(v) Upon 60 days' written notice to the Executive from
the Company without Cause.
(vi) Upon 60 days' written notice to the Company from the
Executive.
(b) "Cause" for purposes hereof shall mean: (i) the commission
by the Executive of theft, embezzlement, fraud, obtaining funds or property
under false pretenses, or similar acts of material misconduct with respect to
the property of the Company or any of its Affiliates or their respective
employees or the Company's customers or suppliers, or the Company's
determination that any oral or written representations made to the Company by
the Executive shall prove false; (ii) the commission by the Executive of a
material act of malfeasance, dishonesty or breach of trust against the Company
or any of its Affiliates or their respective employees or the Company's
franchisees, customers or suppliers, including a breach by the Executive of his
covenants or obligations under Section 9 of this Agreement; (iii) the conviction
of the Executive of a felony or of a misdemeanor involving moral turpitude; or
(iv) the Executive's repeated and continued failure to successfully fulfill his
duties or obligations of employment or his breach of any of his material
obligations and covenants hereunder.
(c) No waiver by the Company of any default by the Executive
or any breach by him of any of his covenants or obligations under any provision
of this Agreement shall be deemed a waiver of any future breach or default,
whether or not such breach or default is of the same nature.
(d) The Executive shall be deemed to be permanently disabled
for purposes hereof, at the option of the Company, in the event that the
Executive shall fail to render and perform the services required of him under
this Agreement because of physical or mental incapacity or disability for a
continuous period of three (3) consecutive months, or for shorter periods
aggregating one hundred and twenty (120) days or more during any period of six
(6) successive months.
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(e) In the event this Agreement and the Executive's employment
by the Company is terminated for reasons stated in Sections 7(a)(i), 7(a)(ii) or
7(a)(v) above, then the Executive shall receive from the Company, as severance
hereunder, the Salary for a period equal to the lesser of (x) the unexpired Term
and (y) one (1) year.
8. Effect of Termination. Upon the termination of this Agreement, for
any reason, or upon the termination of the Executive's employment hereunder, for
any reason, the Executive (i) shall immediately discontinue the use of any and
all trade names, trademarks, trade secrets, copyrights or copyrighted materials,
and customer lists, offering circulars and materials and advertising media
belonging to or supplied to the Executive by the Company, and (ii) shall, at the
Executive's expense, return to the Company all such materials.
9. Non-Competition, Restrictive Covenants, Confidentiality and
Injunctive Relief. (a) The Executive agrees that, commencing as of the date
hereof and during the term of the Executive's employment with the Company
(including any period for which the Executive shall act as a consultant to the
Company), and for a period of two (2) years thereafter, the Executive shall not,
without the prior written approval of the Board of Directors of the Company,
directly or indirectly, through any other person, firm or corporation, whether
for himself or as agent on behalf of any other person or entity, and whether as
employee, consultant, agent, principal, lender, partner, officer, director,
stockholder or otherwise, with our without compensation:
(i) sell products or provide services which are
competitive with the businesses, products or services of the Company or the
business, products or services of the Company contemplated or under development
(the "Businesses"), or promote, market, sell, become or acquire an interest in,
or associate in a business relationship with, or aid or assist any other person,
corporation, firm, partnership or other entity whatsoever who is engaged in any
line of business competitive with the Businesses;
(ii) become an employee, consultant, agent, principal,
lender, partner, officer, director, stockholder or otherwise provide services to
or on behalf of any entity (A) which the Board reasonably determines is or could
become a competitor of the Company or the Businesses or (B) which as of the date
of this Agreement is a business partner or contractual party with the Company;
(iii) solicit or refer, directly or indirectly, any
clients or prospective clients of any services and/or products offered by the
Company (or which are competitive with those offered by the Company) to any
other provider of such services;
(iv) promote, market, assist or participate in the
development, sale, lease or licensing of any services and/or products
competitive with those provided by the Company to, for or with any person,
corporation, firm, partnership or other entity whatsoever; or
(v) solicit, raid, entice, induce or assist any person
who presently is, or any time during the Executive's employment with the Company
shall be or
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shall have been, an employee of the Company or any of its Affiliates, during the
twelve (12) months preceding such solicitation, raid, enticement, inducement or
assistance, to become employed or retained by any other person or entity.
(b) Recognizing that the Executive's knowledge, information
and relationship with existing or prospective clients, licensees, customers,
suppliers, accounts, agents, brokers and representatives of the Company and its
Affiliates, and the knowledge of the business, methods, systems, plans and
policies of the Company and its Affiliates which he has heretofore and shall
hereafter establish, receive or obtain as an employee of the Company or in
connection with services performed for the Company or any such Affiliates, are
valuable and unique assets of the Company and such Affiliates, the Executive
agrees that, at all times during and after the Executive's employment by the
Company, he shall not (otherwise than pursuant to his duties hereunder),
directly or indirectly, use, divulge, furnish or make accessible to anyone,
without the prior written consent of the Board of Directors of the Company, any
such knowledge or information pertaining to the Company or any of its
Affiliates, or the businesses, shareholders, personnel, methods, systems, plans
or policies thereof, to any person, firm or corporation or other entity, for any
reason or purpose whatsoever.
(c) The Company shall be deemed and entitled to own all of the
results and proceeds of the Executive's services, including all right, title and
interest in and to any and all franchises, products, processes, concepts,
methods, ideas, creations, designs and/or systems (including, without
limitation, all those of an advertising, marketing or promotional nature), and
any improvement thereon, which may be developed, created or devised by the
Executive during the term of his employment by the Company. The Executive will,
at the request of the Company, and without further compensation other than that
for which provision is made in this Agreement, execute such assignments,
certificates or other instruments as the Company may from time to time deem
necessary or desirable to evidence, establish, maintain, perfect, protect,
enforce or defend its right, title and interest in or to any of the foregoing.
Without limiting the generality of the previous sentences, the Executive
acknowledges and agrees that all memoranda, notes, records, customer lists and
other documents made or compiled by the Executive or made available to the
Executive during the term of his employment by the Company concerning the
business of the Company and/or any of its Affiliates shall be the Company's
property and shall be delivered by the Executive to the Company upon termination
of his employment by the Company or at any other time on the Company's request.
(d) The Executive shall execute and deliver to and for the
benefit of the Company an agreement substantially in the form of Exhibit 9(d)
hereto, pertaining, among other matters, to Proprietary Information and
Inventions (as such terms are defined in said Exhibit 9(d) and confidentiality
obligations, the provisions of which shall be deemed incorporated herein by
reference as if set forth herein (the "Proprietary Rights Agreement").
(e) The provisions of this Section 9 shall survive the
termination or expiration of this Agreement, irrespective of the reason
therefore, including under circumstances in which the Executive continues
thereafter in the employ of the Company.
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(f) The Executive acknowledges that the services to be
rendered by him are of a special, unique and extraordinary character and, in
connection with such services, he will have access to confidential information
vital to the business of the Company. By reason of the foregoing, the Executive
consents and agrees that, if he violates any of the provisions of this Section
9, the Company would sustain irreparable harm and, therefore, in addition to any
other remedies which the Company may have under this Agreement or otherwise, the
Company shall be entitled to apply (without the necessity of posting any bond)
to any court of competent jurisdiction for an injunction restraining the
Executive or any other party from committing or continuing any such violation
(or participating therein) of this Agreement, and the Executive shall not object
to any such application.
10. Warranty. The Executive warrants and represents that he is not a
party to any agreement, contract or understanding, whether of employment or
otherwise, which would in any way restrict or prohibit him from undertaking his
position as an executive of the Company and complying with his obligations in
accordance with the terms and conditions of this Agreement.
11. Insurance. The Executive agrees that the Company may from time to
time and for the Company's own benefit apply for and take out life insurance
covering the Executive, either independently or together with others, in any
amount and form which the Company may deem to be in its best interests. The
Company shall own all rights in such insurance and in the cash values and
proceeds thereof and the Executive shall not have any right, title or interest
therein. The Executive agrees to assist the Company, at the Company's expense,
in obtaining any such insurance by, among things, submitting to customary
examinations and correctly preparing, signing and delivering such applications
and other documents as reasonably may be required.
12. Notices. All notices shall be in writing and shall be deemed to
have been duly given to a party hereto on the date of such delivery, if
delivered personally, or on the third day after being deposited in the mail if
mailed via registered or certified mail, return receipt requested, postage
prepaid, or on the next business day after being sent by recognized national
overnight courier services, at the addresses of the parties as set forth the
first paragraph of this Agreement, or such other address as the parties may
specify in writing from time to time in accordance herewith.
13. Assignability and Binding Effect. This Agreement shall inure to the
benefit of and shall be binding upon the heirs, executors, administrators,
successors and legal representatives of the Executive, and shall inure to the
benefit of and be binding upon the Company and its successors and assigns. The
Executive may not assign, transfer, pledge, encumber, hypothecate or otherwise
dispose of this Agreement, or any of his rights or obligations hereunder, and
any such attempted delegation or disposition shall be null and void and without
effect.
14. Severability. In the event that any provisions of this Agreement
would be held to be invalid, prohibited or unenforceable in any jurisdiction for
any reason (including, but not limited to, any provisions which would be held to
be unenforceable because of the
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scope, duration or area of its applicability), unless narrowed by construction,
this Agreement shall, as to such jurisdiction only, be construed as if such
invalid, prohibited or unenforceable provision had been move narrowly drawn so
as not to be invalid, prohibited or unenforceable (or if such language cannot be
drawn narrowly enough, the court making any such determination shall have the
power to modify such scope, duration or area or all of them, but only to the
extent necessary to make such provision or provisions enforceable in such
jurisdiction, and such provision shall then be applicable in such modified form
in such jurisdiction only). If, notwithstanding the foregoing, any provision of
this Agreement would be held to be invalid, prohibited or unenforceable in any
jurisdiction, such provision shall be ineffective to the extent of such
invalidity, prohibition or unenforceability, without invalidating the remaining
provisions of this Agreement or affecting the validity or enforceability of such
provision in any other jurisdiction.
15. Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York, without regard to
principles of conflict of laws and regardless of where actually executed,
delivered or performed.
16. Complete Understanding; Drafting; Counterparts. This Agreement
constitutes the complete understanding and supersedes any and all prior
agreements and understandings between the parties with respect to its subject
matter (except with respect to 28,000 options issued to the Executive and
outstanding on the date hereof), and no statement, representation, warranty or
covenant has been made by either party with respect thereto except as expressly
set forth herein. This Agreement shall not be altered, modified, amended or
terminated except by written instrument signed by each of the parties hereto.
The language used in this Agreement will be deemed to be the language chosen by
the both of the parties to express their mutual intent, and no rule of strict
construction shall be applied against either party. The Section and paragraph
headings contained herein are for convenience only, and are not part of and are
not intended to define or limit the contents of said Sections and paragraphs.
This Agreement may be executed in
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counterparts, each of which shall be deemed an original and all of which, when
taken together, shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
THE COMPANY:
MEDSITE PUBLISHING, INC.
By: /s/ Xxxxxxx Xxxx
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Name: Xxxxxxx Xxxx
Title: President and CEO
THE EXECUTIVE:
By: /s/ Xxxxxx Xxxxxxx
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Name: Xxxxxx Xxxxxxx
Title: Vice President
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TABLE A
Salary (per annum) $150,000
Vacation Days 15
Sick Days 5
