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EXHIBIT 10.7
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is made and entered into as of
December 15, 1999, by and between INFORMATION ON DEMAND, INC., a Florida
corporation (the "Company"), and XXXXXXX X. XXXXXX (hereinafter called the
"Executive").
R E C I T A L S
The Company and the Executive have agreed that the Executive shall be
employed by the Company pursuant to the terms and conditions hereinafter set
forth.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and mutual covenants
set forth herein, the parties agree as follows:
1. Employment.
1.1 Employment and Term. The Company hereby agrees to employ the
Executive and the Executive hereby agrees to serve the Company on the terms and
conditions set forth herein. This Agreement having been duly authorized and
approved by the Company's Board of Directors (the "Board").
1.2 Duties of Executive. During the term of this Agreement, the
Executive shall serve, on a part-time basis, as a financial assistant to the
principal executive officers of the Company, which service shall include,
without limitation, consultation and assistance with respect to all financial
and business strategy matters of the Company and facilitation of relations
between the Company and the investment community and acting as a liaison with
respect thereto. The Executive shall diligently perform all reasonable and
appropriate services as may be assigned to him by the Board, and shall exercise
such power and authority as may from time to time be delegated to him by the
Board and as provided by the Bylaws of the Company. During each twelve month
period of this Agreement, the Executive shall devote up to 200 hours of his
time and attention to the business and affairs of the Company, render such
services to the best of his ability, and use his best efforts to promote the
interests of the Company; provided, however, that if the Executive is required
to devote in excess of 16 hours of time in any particular month, the Executive
shall receive, in addition to the compensation set forth in Section 3 hereof,
an amount equal to $1,000 per day ("Additional Compensation"). In the event
that the Company shall request the Executive to devote in excess of 16 hours of
time in any calendar month during the term of this Agreement, fulfillment of
such request shall be subject to the Executive's availability (determined in
his sole discretion).
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2. Term.
2.1 Initial Term. The initial term of this Agreement, and the
employment of the Executive hereunder, shall commence on December 15, 1999 (the
"Commencement Date") and shall expire on December 31, 2002, unless sooner
terminated in accordance with the terms and conditions hereof (the "Initial
Term").
2.2 Renewal Terms. At the end of the Initial Term, this Agreement shall
automatically renew and continue until terminated by either of the parties upon
no less than sixty (60) days prior notice of termination to the other party (the
"Renewal Term").
2.3 Expiration Date. The date on which the term of this Agreement shall
expire (including the date on which any renewal term shall expire), is sometimes
referred to in this Agreement as the Expiration Date.
3. Compensation. The Executive shall receive a base salary at the annual
rate of Twelve Thousand Dollars ($12,000) (the "Base Salary") during the term of
this Agreement, with such Base Salary payable in installments consistent with
the Company's normal payroll schedule, subject to applicable withholding and
other taxes. The Base Salary also shall be reviewed, at least annually, for
merit and cost of living adjustment increases and may, by action and in the
discretion of the Board, be increased at any time or from time to time.
4. Expense Reimbursement and Other Benefits.
4.1 Reimbursement of Expenses. During the term of Executive's
employment hereunder, upon the submission of proper substantiation by the
Executive, and subject to such rules and guidelines as the Company may from time
to time adopt, the Company shall reimburse the Executive for all reasonable
expenses actually paid or incurred by the Executive in the course of and
pursuant to the business of the Company. The Executive shall account to the
Company in writing for all expenses for which reimbursement is sought and shall
supply to the Company copies of all relevant invoices, receipts or other
evidence reasonably requested by the Company.
4.2 Compensation/Benefit Programs. During the term of this Agreement
and subject to the Executive's eligibility under the terms of the Company's
benefit and other plans offered by the Company to its Executives generally, the
Executive shall be entitled to participate in all medical, dental,
hospitalization, accidental death and dismemberment, disability, travel and life
insurance plans, and any and all other plans as are presently and hereinafter
offered by the Company to its executives, including savings, pension,
profit-sharing and deferred compensation plans.
4.3 Working Facilities. If reasonably requested by the Executive, the
Company shall furnish the Executive with an office, secretarial help and such
other facilities and services suitable to his position and adequate for the
performance of his duties hereunder.
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4.4 Stock Options. Effective in November 1999, the Company established
an "Employee Incentive Compensation Plan" under which "Qualified Stock Options"
and "Non-Qualified Stock Options " (as defined under the Internal Revenue Code)
to purchase common stock of the Company may be granted to its employees and
others. Effective December 15, 1999, the Company shall grant to the Executive
Qualified Stock Options to purchase an aggregate of 90,000 shares of common
stock of the Company at an exercise price of $1.00 per share; 22,500 of which
shall vest on December 15, 1999, and 67,500 of which shall vest in equal thirds
of 22,500 on November 1, 2000, November 1, 2001 and November 1, 2002.
Except as provided in this Agreement, the above described Qualified
Stock Options shall be granted to the Executive subject to all terms and
conditions of the Employee Incentive Compensation Plan, and any amendments or
successor plan thereto and all rules of regulation of the Securities and
Exchange Commission applicable to stock option plans then in effect.
4.5 Other Benefits. The Executive shall receive such additional
benefits, if any, as the Board shall from time to time determine.
5. Termination.
5.1 Termination for Cause. The Company shall at all times have the
right, upon written notice to the Executive, to terminate the Executive's
employment hereunder, for cause. For purposes of this Agreement, the term
"cause" shall mean: (a) an action or omission of the Executive which constitutes
a willful and intentional material breach of this Agreement which is not cured
within thirty (30) days after receipt by the Executive of written notice of
same, (b) fraud, embezzlement, misappropriation of funds or breach of trust in
connection with his services hereunder, (c) conviction of any crime which
involves dishonesty or a breach of trust, or (d) gross negligence in connection
with the performance of the Executive's duties hereunder. Any termination for
cause shall be made in writing to the Executive, which notice shall set forth in
detail all acts or omissions upon which the Company is relying for such
termination. The Executive shall have the right to address the Board regarding
the acts set forth in the notice of termination. Upon any termination pursuant
to this Section 5.1, the Company shall pay to the Executive any unpaid Base
Salary and Additional Compensation, if any, to the date of termination. The
Company shall have no further liability hereunder other than for reimbursement
for reasonable business expenses incurred prior to the date of termination,
subject, however, to the provisions of Section 4.1.
5.2 Disability. The Company shall at all times have the right, upon
written notice to the Executive, to terminate the Executive's employment
hereunder, if the Executive shall become entitled to benefits under the
Company's Long Term Disability Plan as then in effect, or, if the Executive
shall as the result of mental or physical incapacity, illness or disability,
become unable to perform his obligations hereunder for a period of 180 days in
any 12-month period. The Company shall have sole discretion based upon competent
medical advice to determine whether the Executive continues to be disabled. Upon
any termination pursuant to this Section 5.2, the Company shall pay to the
Executive any unpaid Base Salary and Additional Compensation, if
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any, through the effective date of termination specified in such notice. The
Company shall have no further liability hereunder other than for reimbursement
for reasonable business expenses incurred prior to the date of termination,
subject, however to the provisions of Section 4.1.
5.3 Death. In the event of the death of the Executive during the term
of his employment hereunder, the Company shall pay to the estate of the deceased
Executive any unpaid Base Salary and Additional Compensation, if any, through
the Executive's date of death. The Company shall have no further liability
hereunder other than for reimbursement for reasonable business expenses incurred
prior to the date of the Executive's death, subject, however to the provisions
of Section 4.1.
5.4 Resignation by Executive. The Executive shall at all times have the
right, upon ninety (90) days written notice to the Company, to terminate the
Executive's employment hereunder. Upon any termination pursuant to this Section
5.4, the Company shall pay to the Executive any unpaid Base Salary and
Additional Compensation, if any, through the
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effective date of termination specified in such notice. The Company shall have
no further liability hereunder other than for reimbursement for reasonable
business expenses incurred prior to the date of termination, subject, however,
to the provisions of Section 4.1.
5.5 Survival. The provisions of this Article 5 shall survive the
termination of this Agreement, as applicable.
6. Restrictive Covenants.
6.1 Non-competition. At all times while the Executive is employed by the
Company and for a two (2) year period after the termination of the Executive's
employment with the Company for any reason, the Executive shall not, directly
or indirectly, engage in or have any interest in any sole proprietorship,
partnership, corporation or business or any other person or entity (whether as
an employee, officer, director, partner, agent, security holder, creditor,
consultant or otherwise) that directly or indirectly (or through any affiliated
entity) engages in a business directly or indirectly in competition with the
Company's business (as such business is described in the Company's prospectus
relating to its rights offering) in the United States, Canada or any foreign
market; provided that such provision shall not apply to (i) the Executive's
ownership of Common Stock of the Company or the acquisition by the Executive,
solely as an investment, of securities of any issuer that is registered under
Section 12(b) or 12(g) of the Securities Exchange Act of 1934, as amended, and
that are listed or admitted for trading on any United States national
securities exchange or that are quoted on the National Association of
Securities Dealers Automated Quotations System, or any similar system or
automated dissemination of quotations of securities prices in common use, so
long as the Executive does not control, acquire a controlling interest in or
become a member of a group which exercises direct or indirect control or, more
than five percent of any class of capital stock of such corporation, (ii) the
Executive's service as an officer, director, consultant or agent of H.T.E.,
Inc., or (iii) investments made by any private equity fund in which the
Executive has a direct or indirect participation, provided that the Executive's
equity ownership in such equity fund does not exceed fifteen (15%) percent.
6.2 Nondisclosure. The Executive shall not at any time divulge,
communicate, use to the detriment of the Company or for the benefit of any other
person or persons, or misuse in any way, any Confidential Information (as
hereinafter defined) pertaining to the business of the Company. Any Confidential
Information or data now or hereafter acquired by the Executive with respect to
the business of the Company (which shall include, but not be limited to,
information concerning the Company's financial condition, prospects, technology,
customers, suppliers, sources of leads and methods of doing business) shall be
deemed a valuable, special and unique asset of the Company that is received by
the Executive in confidence and as a fiduciary, and Executive shall remain a
fiduciary to the Company with respect to all of such information. For purposes
of this Agreement, "Confidential Information" means information disclosed to the
Executive or known by the Executive as a consequence of or through his
employment by the Company (including information conceived, originated,
discovered or developed by the Executive) prior to or after the date hereof, and
not generally known, about the
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Company or its business. Notwithstanding the foregoing, nothing herein shall be
deemed to restrict the Executive from disclosing Confidential Information to the
extent required by law.
6.3 Nonsolicitation of Employees and Clients. At all times while the
Executive is employed by the Company and for a two (2) year period after the
termination of the Executive's employment with the Company for any reason, for
the Executive shall not, directly or indirectly, for himself or for any other
person, firm, corporation, partnership, association or other entity: (a) employ
or attempt to employ or enter into any contractual arrangement with any employee
or former employee of the Company, unless such employee or former employee has
not been employed by the Company for a period in excess of six months, and/or
(b) call on or solicit any of the actual or targeted prospective clients of the
Company on behalf of any person or entity in connection with any business
competitive with the business of the Company, nor shall the Executive make known
the names and addresses of such clients or any information relating in any
manner to the Company's trade or business relationships with such customers,
other than in connection with the performance of Executive's duties under this
Agreement.
6.4 Ownership of Developments. All copyrights, patents, trade secrets,
or other intellectual property rights associated with any ideas, concepts,
techniques, inventions, processes, or works of authorship developed or created
by Executive during the course of performing work for the Company or its clients
(collectively, the "Work Product") shall belong exclusively to the Company and
shall, to the extent possible, be considered a work made by the Executive for
hire for the Company within the meaning of Title 17 of the United States Code.
To the extent the Work Product may not be considered work made by the Executive
for hire for the Company, the Executive agrees to assign, and automatically
assign at the time of creation of the Work Product, without any requirement of
further consideration, any right, title, or interest the Executive may have in
such Work Product. Upon the request of the Company, the Executive shall take
such further actions, including execution and delivery of instruments of
conveyance, as may be appropriate to give full and proper effect to such
assignment.
6.5 Books and Records. Except with respect to the Executive's service
as a director of the Company, all books, records, and accounts relating in any
manner to the customer or clients of the Company, whether prepared by the
Executive or otherwise coming into the Executive's possession, shall be the
exclusive property of the Company and shall be returned immediately to the
Company on termination of the Executive's employment hereunder or on the
Company's request at any time.
6.6 Definition of Company. Solely for purposes of this Section 6, the
term "Company" also shall include any existing or future subsidiaries of the
Company that are operating during the time periods described herein and any
other entities that directly or indirectly, through one or more intermediaries,
control, are controlled by or are under common control with the Company during
the periods described herein.
6.7 Acknowledgment by Executive. The Executive acknowledges and
confirms that the length of the term of the provisions of this Section 6 and the
geographical restrictions
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contained in Section 6.1 are fair and reasonable and not the result of
overreaching, duress or coercion of any kind. The Executive further acknowledges
and confirms that his full, uninhibited and faithful observance of each of the
covenants contained in this Section 6 will not cause him any undue hardship,
financial or otherwise, and that enforcement of each of the covenants contained
herein will not impair his ability to obtain employment commensurate with his
abilities and on terms fully acceptable to him or otherwise to obtain income
required for the comfortable support of him and his family and the satisfaction
of the needs of his creditors. The Executive acknowledges and confirms that his
special knowledge of the business of the Company is such as would cause the
Company serious injury or loss if he were to use such ability and knowledge to
the benefit of a competitor or were to compete with the Company in violation of
the terms of this Section 6.
6.8 Reformation by Court. In the event that a court of competent
jurisdiction shall determine that any provision of this Section 6 is invalid or
more restrictive than permitted under the governing law of such jurisdiction,
then only as to enforcement of this Section 6 within the jurisdiction of such
court, such provision shall be interpreted and enforced as if it provided for
the maximum restriction permitted under such governing law.
6.9 Extension of Time. If the Executive shall be in violation of any
provision of this Section 6, then each time limitation set forth in this Section
6 shall be extended for a period of time equal to the period of time during
which such violation or violations occur. If the Company seeks injunctive relief
from such violation in any court, then the covenants set forth in this Section 6
shall be extended for a period of time equal to the pendency of such proceeding
including all appeals by the Executive.
6.10 Survival. The provisions of this Section 6 shall survive the
termination of this Agreement, as applicable.
7. Injunction. It is recognized and hereby acknowledged by the parties
hereto that a breach by the Executive of any of the covenants contained in
Section 6 of this Agreement will cause irreparable harm and damage to the
Company, the monetary amount of which may be virtually impossible to ascertain.
As a result, the Executive recognizes and hereby acknowledges that the Company
shall be entitled to an injunction from any court of competent jurisdiction
enjoining and restraining any violation of any or all of the covenants contained
in Section 6 of this Agreement by the Executive or any of his affiliates,
associates, partners or agents, either directly or indirectly, and that such
right to injunction shall be cumulative and in addition to whatever other
remedies the Company may possess.
8. Assignment. Neither party shall have the right to assign or delegate
his rights or obligations hereunder, or any portion thereof, to any other
person.
9. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Florida.
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10. Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto with respect to the subject matter hereof and, upon
its effectiveness, shall supersede all prior agreements, understandings and
arrangements, both oral and written, between the Executive and the Company (or
any of its affiliates) with respect to such subject matter. This Agreement may
not be modified in any way unless by a written instrument signed by both the
Company and the Executive.
11. Notices. All notices required or permitted to be given hereunder shall
be in writing and shall be personally delivered by courier, sent by registered
or certified mail, return receipt requested or sent by confirmed facsimile
transmission addressed as set forth herein. Notices personally delivered, sent
by facsimile or sent by overnight courier shall be deemed given on the date of
delivery and notices mailed in accordance with the foregoing shall be deemed
given upon the earlier of receipt by the addressee, as evidenced by the return
receipt thereof, or three (3) days after deposit in the U.S. Mail. Notice shall
be sent: (a) if to the Company, addressed to 0000 Xxxxxxxx Xxxx, Xxxxx X,
Xxxxxxxx, Xxxxxxx 00000, Attention: Chief Executive Officer, with a copy of such
notice addressed to X. X. Xxxxxx, Jr., Esq., 000-X Xxxxx Xxxxxxxxx Xxxxxx,
Xxxxxxx Xxxxx, XX 00000, and (b) if to the Executive, to his address as
reflected on the payroll records of the Company, or to such other address as
either party hereto may from time to time give notice of to the other.
12. Benefits; Binding Effect. This Agreement shall be for the benefit of
and binding upon the parties hereto and their respective heirs, personal
representatives, legal representatives, successors and, where applicable,
assigns, including, without limitation, any successor to the Company, whether by
merger, consolidation, sale of stock, sale of assets or otherwise.
13. Severability. The invalidity of any one or more of the words, phrases,
sentences, clauses or sections contained in this Agreement shall not affect the
enforceability of the remaining portions of this Agreement or any part thereof,
all of which are inserted conditionally on their being valid in law, and, in the
event that any one or more of the words, phrases, sentences, clauses or sections
contained in this Agreement shall be declared invalid, this Agreement shall be
construed as if such invalid word or words, phrase or phrases, sentence or
sentences, clause or clauses, or section or sections had not been inserted. If
such invalidity is caused by length of time or size of area, or both, the
otherwise invalid provision will be considered to be reduced to a period or area
which would cure such invalidity.
14. Waivers. The waiver by either party hereto of a breach or violation of
any term or provision of this Agreement shall not operate nor be construed as a
waiver of any subsequent breach or violation.
15. Damages. Nothing contained herein shall be construed to prevent the
Company or the Executive from seeking and recovering from the other damages
sustained by either or both of them as a result of its or his breach of any term
or provision of this Agreement. In the event that either party hereto brings
suit for the collection of any damages resulting from, or the injunction
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of any action constituting, a breach of any of the terms or provisions of this
Agreement, then the party found to be at fault shall pay all reasonable court
costs and attorneys' fees of the other.
16. Section Headings. The section headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
17. No Third Party Beneficiary. Nothing expressed or implied in this
Agreement is intended, or shall be construed, to confer upon or give any person
other than the Company, the parties hereto and their respective heirs, personal
representatives, legal representatives, successors and assigns, any rights or
remedies under or by reason of this Agreement.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first above written.
COMPANY:
INFORMATION ON DEMAND, INC.
By: /s/ O. F. Xxxxx
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Name: O. F. Xxxxx
Title: Chief Executive Officer and President
EXECUTIVE:
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
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