EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into as of the
2nd day of January 2007 (the "Effective Date"), between Circle Group Holdings,
Inc., an Illinois corporation, whose principal place of business is 0000 Xxxxxx
Xxxxx, Xxxxxxxxx, Xxxxxxxx 00000 and any of its successors or affiliated
companies (collectively, the "Company") and Xxxxx X. Xxxxx, an individual
(hereinafter collectively referred to as the "Employee"), located at 0000
Xxxxxxxxx Xxxxx, Xxxxxxxxx Xxxxxxxx 00000
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WHEREAS, the Company is principally engaged in the business of development
and marketing of life-changing technologies (the "Business").
WHEREAS, the Company desires to employ the Employee and the Employee
desires to enter into the employ of the Company.
WHEREAS, the Company has established a valuable reputation and goodwill in
its business, with expertise in all aspects of the Business.
WHEREAS, the Employee has established a valuable reputation and goodwill in
his business, with expertise in certain, but not all, aspects of the Company's
business by virtue of the Employee's employment with the Company, will become
familiar with and possessed with the manner, methods, trade secrets and other
confidential information pertaining to the Company's Business, including the
Company's client base.
NOW, THEREFORE, in consideration of the mutual agreements herein made, the
Company and the Employee do hereby agree as follows:
1. Recitals. The above recitals are true, correct, and are herein
incorporated by reference.
2. Employment. The Company hereby employs the Employee, and the Employee
hereby accepts employment, upon the terms and conditions hereinafter set forth.
3. Authority and Power during Employment Period.
a. Duties and Responsibilities. During the Term of this Agreement, the
Employee shall serve as "Chief Financial Officer" of the Company and shall have
such responsibilities and duties as customarily undertaken by individuals in
similar positions.
b. Time Devoted. Throughout the Term of this Agreement, the Employee shall
devote substantially all of the Employee's business time and attention to the
business and affairs of the Company consistent with the Employee's position with
the Company, except for reasonable vacations, illness or incapacity.
c. Best Efforts. Throughout the Term of this Agreement, the Employee agrees
to use his best efforts to promote the Company's Business. For purposes of this
Agreement, "best efforts" shall
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be defined as the Employee carrying out his assigned duties and
responsibilities, adhering to the covenants contained in paragraphs 7(a) and
7(b) of this Agreement, and complying with the policies and procedures related
to the Company's operation of its Business.
4. Term. The Term of employment hereunder will commence on the Effective
Date as set forth above, and finish three (3) year from the Effective Date, and
can be renewed every year for one (1) year thereafter based on the mutual desire
by the parties, unless this Agreement shall have been earlier terminated
pursuant to Section 7 of this Agreement.
5. Compensation.
a. Salary. The Employee shall be paid a base salary, payable in accordance
with the Company's policies from time to time for salaried employees, at the
rate of eight thousand five hundred dollars ($8,500) per month..
b. Stock & Options. The Employee shall receive options under the Company's
2004 Stock Equity Plan. The options shall be exercisable for a (3) year period
of time from the date of vesting.
6. Consequences of Termination of Employment.
a. Disability. In the event of the Employee's disability, the Employee
shall be entitled to compensation in accordance with the Company's disability
compensation practice for its salaried employees. "Disability," for the purposes
of this Agreement, shall be deemed to have occurred in the event (A) the
Employee is unable by reason of sickness or accident, to perform his duties
under this Agreement for an aggregate of 90 days in any 12-month period or 45
consecutive days, or (B) the Employee has a guardian of his person or estate
appointed by a court of competent jurisdiction. Termination due to disability
shall be deemed to have occurred upon the first day of the month following the
determination of disability as defined in the preceding sentence.
b. Termination by the Company for Cause.
i. Nothing herein shall prevent the Company from terminating the Employee
for "Cause," as hereinafter defined. The Employee shall continue to
receive salary only for the period ending with the date of such
termination as provided in this Section 6(b). Any rights and benefits
the Employee may have in respect of any other compensation shall be
determined in accordance with the terms of such other compensation
arrangements or such plans or programs.
ii. Either party may terminate without cause on 30 days written notice. In
this eventuality, all vested options will be fully owned by the
Employee.
iii. "Cause" shall mean (A) committing or participating in an injurious act
of fraud, gross neglect, misrepresentation, embezzlement or dishonesty
against the Company; (B) committing or participating in any other
injurious act or omission wantonly, willfully, recklessly or in a
manner which was grossly negligent
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against the Company, monetarily or otherwise; (C) engaging in a
criminal enterprise involving moral turpitude; (D) an act or acts (1)
constituting a felony under the laws of the United States or any state
thereof; or (2) if applicable, loss of any state or federal license
required for the Employee to perform the Employee's material duties or
responsibilities for the Company; (E) the Employee's breach of any
provision of this Agreement; or (F) any assignment of this Agreement
by the Employee in violation of Section 13 of this Agreement.
iv. Notwithstanding anything else contained in this Agreement, this
Agreement will not be deemed to have been terminated for Cause unless
and until there shall have been delivered to the Employee a notice of
termination stating that the Employee committed one of the types of
conduct, notwithstanding anything contained herein to the contrary,
this Agreement may be terminated (i) at any time upon the mutual
written consent of the Company and the Employee; or (ii) by either
party giving 30 days prior written notice to the other. During such 30
day period, only the Employee shall continue to perform the Employee's
duties pursuant to this Agreement, and the Company shall continue to
compensate the Employee in accordance with this Agreement.
d. Death. In the event of the death of the Employee during the Term of the
Agreement, compensation shall be paid to the Employee's designated beneficiary,
or, in the absence of such designation, to the estate or other legal
representative of the Employee for a period of one hundred eighty (180) days
from and after the date of death. Other death benefits will be determined in
accordance with the terms of the Company's benefit programs and plans.
7. Covenant Not to Compete and Non-Disclosure of Information
a. Covenant Not to Compete. The Employee acknowledges and recognizes the
highly competitive nature of the Company's Business and the goodwill, continued
patronage, and specifically the names and addresses of the Company's Clients (as
hereinafter defined) constitute a substantial asset of the Company having been
acquired through considerable time, money and effort. Accordingly, in
consideration of the execution of this Agreement, the Employee agrees to the
following:
i. That during the Restricted Period (as hereinafter defined) and within
the Restricted Area (as hereinafter defined), the Employee will not,
individually or in conjunction with others, directly or indirectly,
engage in any Business Activities (as hereinafter defined), whether as
an officer, director, proprietor, employer, partner, independent
contractor, investor (other than as a holder solely as an investment
of less than one percent (1%) of the outstanding capital stock of a
publicly traded corporation), consultant, advisor, agent or otherwise.
ii. That during the Restricted Period and within the Restricted Area, the
Employee will not, directly or indirectly, compete with the Company by
soliciting, inducing or influencing any of the Company's Clients which
have a business relationship with the Company at the time during the
Restricted Period to discontinue or reduce the extent of such
relationship with the Company.
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iii. That during the Restricted Period and within the Restricted Area, the
Employee will not (A) directly or indirectly recruit, solicit or
otherwise influence any employee or agent of the
Company to discontinue such employment or agency relationship with the Company,
or (B) employ or seek to employ, or cause or permit any business which competes
directly or indirectly with the Business Activities of the Company (the
"Competitive Business") to employ or seek to employ for any Competitive Business
employs or seeks to employ such person employed by the Company.
iv. That during the Restricted Period the Employee will not interfere
with, or disrupt or attempt to disrupt any past, present or
prospective relationship, contractual or otherwise, between the
Company and any supplier, customer or agent of the Company.
b. Non-Disclosure of Information. The Employee acknowledges that the
Company's trade secrets, private or secret processes, methods and ideas, as they
exist from time to time, customer lists and information concerning the Company's
products, services, training methods, development, technical information,
marketing activities and procedures, credit and financial data concerning the
Company and/or the Company's Clients (the "Proprietary Information") are
valuable, special and unique assets of the Company, access to and knowledge of
which are essential to the performance of the Employee hereunder. In light of
the highly competitive nature of the industry in which the company's business is
conducted, the Employee agrees that all Proprietary Information, heretofore or
in the future obtained by the Employee as a result of the Employee's association
with the Company shall be considered confidential.
In recognition of this fact, the Employee agrees that the Employee, during
the Restricted Period, will not use or disclose any of such Proprietary
Information for the Employee's own purposes or for the benefit of any person or
other entity or organization (except the Company) under any circumstances unless
such Proprietary Information has been publicly disclosed generally or, unless
upon written advice of legal counsel reasonably satisfactory to the Company, the
Employee is legally required to disclose such Proprietary Information. Documents
(as hereinafter defined) prepared by the Employee or that come into the
Employee's possession during the Employee's association with the Company are and
remain the property of the Company, and when this Agreement terminates, such
Documents shall be returned to the Company at the Company's principal place of
business, as provided in the Notices provision (Section 9) of this Agreement.
c. Documents. "Documents" shall mean all original written, recorded, or
graphic matters whatsoever, and any and all copies thereof, including, but not
limited to: papers; email; books; records; tangible things; correspondence;
communications; telex messages; memoranda; work-papers; reports; affidavits;
statements; summaries; analyses; evaluations; client records and information;
agreements; agendas; advertisements; instructions; charges; manuals; brochures;
publications; directories; industry lists; schedules; price lists; client lists;
statistical records; training manuals; computer printouts; books of account;
records and invoices reflecting business operations; all things similar to any
of the foregoing however denominated. In all cases where originals are not
available, the term "Documents" shall also mean identical copies of original
documents or non-identical copies thereof.
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d. Company's Clients. The "Company's Clients" shall be deemed to be any
persons, partnerships, corporations, professional associations or other
organizations for whom the Company has performed Business Activities.
e. Restricted Period. The "Restricted Period" shall be deemed as the term
of this Agreement and six (6) months following termination of this Agreement.
f. Restricted Area. The Restricted Area shall be deemed to mean within any
county of any state in which the Company is providing service at the time of
termination of this Agreement.
g. Business Activities. "Business Activities" shall be deemed to include
the Business and any additional activities that the Company or any of its
affiliates may engage in during the term of this Agreement.
h. Covenants as Essential Elements of this Agreement. It is understood by
and between the parties hereto that the foregoing covenants contained in
Sections 7(a) and 7(b) are essential elements of this Agreement, and that but
for the agreement by the Employee to comply with such covenants, the Company
would not have agreed to enter into this Agreement. Such covenants by the
Employee shall be construed to be agreements independent of any other provisions
of this Agreement. The existence of any other claim or cause of action, whether
predicated on any other provision in this Agreement, or otherwise, as a result
of the relationship between the parties shall not constitute a defense to the
enforcement of such covenants against the Employee.
i. Survival After Termination of Agreement. Notwithstanding anything to
the contrary contained in this Agreement, the covenants in Sections
7(a) and 7(b) shall survive the termination of this Agreement and the
Employee's employment with the Company.
j. Remedies.
i. The Employee acknowledges and agrees that the Company's remedy at law
for a breach or threatened breach of any of the provisions of Section
7(a) or 7(b) herein would be inadequate and the breach shall be per se
deemed as causing irreparable harm to the Company. In recognition of
this fact, in the event of a breach or threatened breach by the
Employee of any of the provisions of Section 7(a) or 7(b), the
Employee agrees that, in addition to any remedy at law available to
the Company, including, but not limited to monetary damages, all
rights of the Employee to payment or otherwise under this Agreement
and all amounts then or thereafter due to the Employee from the
Company under this Agreement may be terminated and the Company,
without posting any bond, shall be entitled to obtain, and the
Employee agrees not to oppose the Company's request for equitable
relief in the form of specific performance, temporary restraining
order, temporary or permanent injunction or any other equitable remedy
which may then be available to the Company.
ii. The Employee acknowledges that the granting of a temporary injunction,
temporary restraining order or permanent injunction merely prohibiting
the use of Proprietary Information would not be an adequate remedy
upon breach or threatened breach of Section 7(a) or 7(b) and
consequently agrees, upon proof of any such breach, to the granting of
injunctive relief prohibiting any form of competition with the
Company. Nothing herein contained shall be construed as prohibiting
the Company from pursuing any other remedies available to it for such
breach or threatened breach.
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8. Withholding. Anything to the contrary notwithstanding, all payments
required to be made by the Company hereunder to the Employee or the Employee's
estate or beneficiaries shall be subject to the withholding of such amounts, if
any, relating to tax and other payroll deductions, the Company may accept other
arrangements pursuant to which it is satisfied that such tax and other payroll
obligations will be satisfied in a manner complying with applicable law and
regulation.
9. Notices. Any notice required or permitted to be given under the terms of
this Agreement shall be sufficient if in writing and if sent postage prepaid by
registered or certified mail, return receipt requested, by overnight delivery;
by courier; or by confirmed telecopy, in the case of the Employee to the
Employee's last place of business or residence as shown on the records of the
Company, or in the case of the Company to its principal office as set forth in
the first paragraph of this Agreement, or at such other place as it may
designate.
10. Waiver. Unless agreed in writing, the failure of either party, at any
time, to require performance by the other of any provisions hereunder shall not
affect its right thereafter to enforce the same, nor shall a waiver by either
party of any breach of any provision hereof be taken or held to be a wavier of
any other preceding or succeeding breach of any term or provision of this
Agreement. No extension of time for the performance of any obligation or act
shall be deemed to be an extension of time for the performance of any other
obligation or act hereunder.
11. Completeness and Modification. This Agreement constitutes the entire
understanding between the parties hereto superseding all prior and
contemporaneous agreements or understandings among the parties hereto concerning
the Employment Agreement. This Agreement may be amended, modified, superseded or
canceled, and any of the terms, covenants, representations, warranties or
conditions hereof may be waived, only by a written instrument executed by the
parties or, in the case of a waiver, by the party to be charged.
12. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which shall
constitute but one agreement.
13. Binding Effect/Assignment. This Agreement shall be binding upon the
parties hereto, their heirs, legal representatives, successors and assigns. This
Agreement shall not be assignable by the Employee but shall be assignable by the
Company in connection with the sale, transfer or other disposition of any part
or all of its business or to any of the Company's affiliates controlled by or
under common control with the Company.
14. Governing Law. This Agreement shall become valid when executed and
accepted by Company. The parties agree that it shall be deemed made and entered
into in the State of Illinois and shall be exclusively governed, venued and
construed under and in accordance with the laws of the State of Illinois.
Anything in this Agreement to the contrary notwithstanding, the Employee shall
conduct the Employee's business in a lawful manner and faithfully comply with
applicable laws or regulations of the state, city or other political subdivision
in which the Employee is located.
15. Further Assurances. All parties hereto shall execute and deliver such
other instruments and do such other acts as may be necessary to carry out the
intent and purposes of this Agreement.
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16. Headings. The headings of the sections are for convenience only and
shall not control or affect the meaning or construction or limit the scope or
intent of any of the provisions of this Agreement.
17. Survival. Any termination of this Agreement shall not, however, affect
the ongoing provisions of this Agreement which shall survive such termination in
accordance with their terms.
18. Severability. The invalidity or unenforceability, in whole or in part,
of any covenant, promise or undertaking, or any section, subsection, paragraph,
sentence, clause, phrase or word or of any provision of this Agreement shall not
affect the validity or enforceability of the remaining portions thereof.
19. Enforcement. Should it become necessary for any party to institute
legal action to enforce the terms and conditions of this Agreement, the
successful party will be awarded reasonable attorneys' fees at all trial and
appellate levels, expenses and costs.
20. Venue. Company and Employee acknowledge and agree that the U.S.
District for the Northern District of Illinois, or if such court lacks
jurisdiction, the Nineteenth Judicial Circuit (or its successor) in and for Lake
County, Illinois, shall be the venue and exclusive proper forum in which to
adjudicate any case or controversy arising either, directly or indirectly, under
or in connection with this Agreement and the parties further agree that, in the
event of litigation arising out of or in connection with this Agreement in these
courts, they will not contest or challenge the jurisdiction or venue of these
courts.
21. Construction. This Agreement shall be construed within the fair meaning
of each of its terms and not against the party drafting the document.
22. Independent Legal Counsel. The parties have either (i) been represented
by independent legal counsel in connection with the negotiation and execution of
this Agreement, or (ii) each has had the opportunity to obtain independent legal
counsel, has been advised that it is in their best interests to do so, and by
execution of this Agreement has waived such right.
23. Facsimile Copies. All duly executed facsimile copies are fully binding
under any and all applicable laws.
THE EMPLOYEE ACKNOWLEDGES THAT HE HAS READ ALL OF THE TERMS OF THIS AGREEMENT,
UNDERSTANDS THE AGREEMENT, AND AGREES TO ABIDE BY ITS TERMS AND CONDITIONS.
WITNESSED BY: BY:
CIRCLE GROUP HOLDINGS, INC. Xxxxx X. Xxxxx
/s/ Xxxxxxx X. Xxxxxxx /s/ Xxxxx X. Xxxxx
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Xxxxxxx X. Xxxxxxx (CEO) Xxxxx X. Xxxxx
Circle Group Holdings, Inc.
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