Exhibit 10.7 Employment Agreement with Xxxxxx X. Xxxxxx
VENTURENET CAPITAL GROUP, INC.
EMPLOYMENT AGREEMENT
WITH
XXXXXX X. XXXXXX
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into
as of January 1, 2001, between VentureNet Capital Group, Inc., a Delaware
corporation (the "Company"), and Xxxxxx X. Xxxxxx, an individual (the
"Executive").
RECITALS
WHEREAS, the Company wishes to employ the Executive as
Vice-President and Comptroller of the Company;
WHEREAS, the Executive wishes to enter into the employ of the
Company as its Vice-President and Comptroller;
WHEREAS, to provide Executive with incentive to enter into its
employ, the Company desires to provide Executive with compensation under the
conditions set forth in this Agreement; and
WHEREAS, Company and the Executive wish to define their relationship
and to ensure employment on the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the foregoing and of the
respective covenants and agreements of the parties herein contained, the parties
hereto, intending to be legally bound, hereby agree as follows:
1. PURPOSE OF AGREEMENT
The purpose of this Agreement is to define the relationship between
the Company, as employer of Executive, and Executive, as an employee of the
Company.
2. EMPLOYMENT
During the term of this Agreement, Executive shall serve as the
Vice-President and Comptroller of the Company and perform the tasks incident to
these positions. The Executive shall report to the Board of Directors of the
Company. Executive's position is full-time and Executive shall devote as much
time as may be necessary to perform Executive's duties.
3. TERM OF EMPLOYMENT
Subject to prior termination pursuant to Section 11 hereof, this
Agreement shall terminate on May 31, 2001 and shall commence on the date hereof
(the "Employment Period").
4. COMPENSATION
4.1 SALARY
The Company will pay the Executive a basic contract fee of one
million (1,000,000) shares of the common stock of Company as of the date of
execution hereof. Said shares shall be issued under an S-8 registration or other
appropriate registration at the Company's expense. The Company shall from time
to time execute, or use diligent efforts to cause to be executed, all such
documents and agreements as are necessary to vest in the Executive no less than
the preferential treatment (including without limitation, liquidation preference
and anti-dilution rights) granted to other current or future holders of the
common stock.
4.2 BONUS
Executive may be entitled to receive, in addition to the annual base
salary referenced above, an annual bonus in an amount to be determined by the
Board of Directors of the Company in its sole discretion.
4.3 STOCK OPTIONS
Nothing contained in this Agreement shall affect the right of
Executive to receive benefits or other shares under any option plan existing or
adopted by the Company. The options, if any, will be designated as incentive
stock options to the extent permitted under the Plan and applicable law.
5. REIMBURSEMENT OF BUSINESS-RELATED EXPENSES INCURRED BY EXECUTIVE
The Company shall reimburse Executive for all reasonable and
necessary expenses incurred by Executive in connection with his employment
hereunder, in accordance with the general policy of the Company regarding
reimbursement of Executive's expenses or pursuant to an applicable travel
policy.
6. BENEFITS
Executive shall be entitled to receive such health, dental, personal
disability, life insurance and flexible time-off benefits as are provided for
other executives of the Company with similar duties and work requirements and as
may be authorized and adopted from time to time in the future by the Company.
Executive shall be entitled to the number of weeks of paid vacation each year as
the Company grants to its senior executives.
7. NONCOMPETITION
Executive agrees that during the Employment Period and for a period
of twelve (12) months thereafter, he will not, except in furtherance of his
employment with the Company, without the prior written consent of the Company,
either directly or indirectly operate, control, advise, be engaged by, perform
any consulting services for, invest in (other than less than one percent of the
outstanding stock in a publicly held corporation which is listed on the NASDAQ
national market or traded over-the-counter or on a recognized securities
exchange) or otherwise become associated in any capacity with, any business,
company, partnership, organization, proprietorship, or other entity in
competition with the Company in those geographical areas in which the Company
conducts or has conducted such business, or intends to conduct business,
consistent with the Company's current, written business plans, during
Executive's employment.
8. NONDISCLOSURE
Executive agrees at all times to hold as secret and confidential
(unless disclosure is required by the Company or would be in furtherance of
Executive's employment with the Company or is required pursuant to court order,
subpoena in a governmental proceeding, arbitration or pursuant to other process
or requirement of law) any and all knowledge, information, developments,
manufacturing and trade secrets, know-how and confidences of the Company or its
business of which he has knowledge during the Employment Period, to the extent
such matters have not previously been made public, are not thereafter made
public, or do not otherwise become available to Executive from a third party
not, to Executive's best knowledge, bound by any confidentiality agreement with
the Company ("Confidential Information"). The phrase "made public" as used in
this Agreement shall apply to matters within the domain of (a) the general
public or (b) the Company's industry. Executive agrees not to use such knowledge
for his own benefit or for the benefit of others or, except as provided above,
disclose any of such Confidential Information without the prior written consent
of the Company, which consent shall make express reference to this Agreement.
9. NONINTERFERENCE
Executive agrees that during the Employment Period and for a period
of twelve (12) months thereafter, he will not, except in furtherance of his
employment with the Company or as a part of his duties as an officer of the
Company, without the prior written consent of the Company, directly or
indirectly solicit, induce or attempt to solicit or induce any executive, agent
or other representative or associate of the Company to terminate its
relationship with the Company or in any way interfere with such a relationship.
10. DISCLOSURE OF PROPRIETARY INTELLECTUAL PROPERTY
10.1 Executive agrees that he will promptly disclose to the Company
any and all improvements, discoveries, ideas, developments or inventions
composing proprietary intellectual property which may be material to the
operations and business of the Company (the "Improvements") which Improvements
are made or conceived by Executive, acting alone or in conjunction with others,
(a) during the Employment Period, or (b) to the extent the Improvements are
specifically and directly related to the company products within three (3) years
after the Employment Period, if such Improvement results from or was suggested
by such employment. Executive shall not disclose any such Improvement to any
person, except the Company and shall use all reasonable efforts to provide the
Company written disclosure of such Improvements. Each such Improvement shall be
the sole and exclusive property of and is hereby assigned to the Company.
Executive agrees that, at the request of the Company, Executive will execute
such applications, statements, assignments or other documents, furnish such
information and data and take all such other action (including without
limitation the giving of testimony) as the Company may from time to time
reasonably request in order to obtain for the Company a registration or patent
in the United States or any foreign country covering or pertaining to any such
Improvement. The Company and Executive hereby acknowledge and agree that the
obligations set forth in this Section 10 do not apply to an Improvement for
which no equipment, supplies, facility, copyright, patent or patent application,
registration, information, or other intellectual property or trade secret
information of the Company was used and which was developed entirely on
Executive's own time, unless (a) the Improvement relates (i) directly to the
business of the Company, or (ii) to the Company's actual or demonstrably
anticipated research or development, or (b) the Improvement results from any
work performed by Executive for the Company.
11. TERMINATION OF EMPLOYMENT
11.1 EVENTS OF TERMINATION
(a) Notwithstanding anything to the contrary contained herein, this
Agreement shall terminate immediately and, except for the obligations of
Executive set forth in Sections 7, 8, 9, 10 and 11.2 hereof and the payment by
the Company of all salary, expenses or benefits which may be earned but unpaid
or unreimbursed (as the case may be) as of the date of termination which
obligations shall survive such termination, all rights and obligations of the
Company and Executive hereunder shall be completely null and void upon the
earliest to occur of the following:
(i) the death of Executive;
(ii) the termination of Executive's employment by the
Company "for cause" during the term of this Agreement; or
(iii) the voluntary termination by Executive of his
employment with the Company during the term of this Agreement pursuant to
Section 11.1(b) hereof.
As used in subsection (ii) above, a termination "for cause" may
include, but shall not be limited to, the occurrence of any of the following
events during the Employment Period:
(A) Executive's conviction of any felony, or
conviction of embezzlement, destruction or misappropriation of money or other
property of the Company;
(B) Executive's failure, refusal or
inability to perform his duties on behalf of the Company, which duties are
consistent with the scope and nature of Executive's responsibilities as an
officer of the Company and which are not remedied by Executive within a
reasonable time period after receipt of written notice of such alleged violative
activities;
(C) any act of gross negligence, intentional
waste, disloyalty or unfaithfulness by Executive to the Company; or
(D) a breach of any of the terms and
provisions of Sections 7, 8, 9, or 10 of this Agreement or any breach of the
fiduciary duties owed to the Company by Executive.
(b) Executive may terminate this Agreement in the event
the Company fails or refuses to perform, or otherwise breaches, the provisions
of this Agreement and the Company fails to cure such breach within thirty (30)
days after receiving written notice from Executive describing such breach and
specifically referring to this Section 11.1(b).
11.2 EXECUTIVE'S RESPONSIBILITIES UPON TERMINATION
Following any notice of termination, Executive shall fully cooperate
with the Company in all matters relating to the winding up of his pending work
on behalf of the Company and to the orderly transfer of any such pending work to
other executives of the Company as may be designated by the Company.
11.3 NOTICE
The term "Notice of Termination" shall mean at least 20 working
days' written notice of termination of Executive's employment, during which
period Executive's employment and performance of services will continue;
provided, however, that the Company may, upon notice to Executive and without
reducing Executive's compensation during such period, excuse Executive from any
or all of his or her duties during such period. The effective date of the
termination of Executive's employment hereunder shall be the date on which such
20-day period expires.
12. TERMINATION PAYMENTS
In the event of termination of the employment of Executive, all
compensation and benefits set forth in this Agreement shall terminate except as
specifically provided in this Section 12:
12.1 TERMINATION BY THE COMPANY
If the Company terminates Executive's employment prior to the end of
the term of this Agreement, Executive shall be entitled to receive (a)
termination payments equal to the amounts payable under Section 4 of the
Agreement, and (b) any unpaid annual base salary and any accrued vacation and
deferred compensation (together with accrued interest or earnings thereon, if
any) payable under the deferral plan, which has accrued for services already
performed as of the date termination of Executive's employment becomes
effective.
12.2 TERMINATION BY EXECUTIVE
In the case of the termination of Executive's employment by
Executive, Executive shall not be entitled to any payments hereunder, other than
those set forth in clause (b) of Section 12.1 hereof.
12.3 EXPIRATION OF TERM
In the case of a termination of Executive's employment as a result
of the expiration of the term of this Agreement, Executive shall not be entitled
to receive any payments hereunder, other than those set forth in clause (b) of
Section 12.1 hereof.
12.4 PAYMENT SCHEDULE
All payments under this Section 12 shall be made to Executive at the
same interval as payments of salary were made to Executive immediately prior to
termination.
13. INTEGRATION
This Agreement constitutes the entire agreement between Executive
and the Company relating in any way to the employment of Executive by the
Company, and supersedes all prior discussions, understandings and agreements
between them with respect thereto.
14. INVALID PROVISION
The invalidity or unenforceability of any particular provision of
this Agreement shall not affect any other provision hereof, and the Agreement
shall be construed in all other respect as if such invalid or unenforceable
provisions were omitted. However, if any court should determine that the
duration or any other feature of any restriction contained in Section 7 of this
Agreement is unenforceable, it is the intention of the parties that the
provisions of such Section as set forth herein shall not thereby be terminated,
but shall be deemed amended to the extent required to render them valid and
enforceable.
15. ATTORNEYS' FEES
In the event of a dispute arising out of the interpretation or
enforcement of this Agreement, the prevailing party shall be entitled to recover
reasonable attorneys' fees and costs.
16. BINDING EFFECT
This Agreement shall be binding upon and shall inure to the benefit
of the respective parties hereto, their heirs, executors, successors and
assigns.
17. GOVERNING LAW
This Agreement and the parties' performance hereunder shall be
governed by and interpreted under the laws of the State of California. Executive
agrees to submit to the jurisdiction of the courts of the State of California,
and that venue for any action arising out of this Agreement or the parties'
performance hereunder may be laid in Riverside County, California.
18. AMENDMENTS
Any term of this Agreement may be amended and the observance of any
term may be waived (either generally or in a particular instance and either
retroactively or prospectively) only with the written consent of the parties.
19. ASSIGNMENT
This Agreement is personal to Executive and shall not be assignable
by Executive. The Company may assign its rights hereunder to (a) any corporation
resulting from any merger, consolidation or other reorganization to which the
Company is a party or (b) any corporation, partnership, association or other
person to which the Company may transfer all or substantially all of the assets
and business of the Company existing at such time. All of the terms and
provisions of this Agreement shall be binding upon and shall inure to the
benefit of and be enforceable by the parties hereto and their respective
successors and permitted assigns.
20. CONSENTS AND WAIVERS
No consent or waiver, express or implied, by any party hereto to or
of any breach or default by any other party in the performance by the others of
their obligations hereunder shall be valid unless in writing, and no such
consent or waiver shall be deemed or construed to be a consent or waiver to or
of any other breach or default in the performance by such other party of the
same or any other obligations of such party hereunder. Failure on the part of
any party to complain of any act or failure to act of any other party or to
declare the other parties in default, irrespective of how long such failure
continues, shall not constitute a waiver by such party of its rights hereunder.
The granting of any consent or approval in any one instance by or on behalf of
the Company shall not be construed to waive or limit the need for such consent
or approval in any other subsequent instance.
21. CONSTRUCTION
This Agreement has been submitted to the scrutiny of, and has been
negotiated by, all parties hereto and their counsel, and shall be given a fair
and reasonable interpretation in accordance with the terms hereof, without
consideration or weight being given to its having been drafted by any party
hereto or its counsel.
22. HEADINGS
Titles or captions of sections contained in this Agreement are
inserted only as a matter of convenience and for reference, and in no way
define, limit, extend or describe the scope of this Agreement or the intent of
any provisions hereof.
23. REMEDIES IN EQUITY
The rights and remedies of the parties hereunder shall not be
mutually exclusive, i.e., the exercise of one or more of the provisions hereof
shall not preclude the exercise of any other provisions hereof. The parties
confirm that damages at law will be an inadequate remedy for a breach or
threatened breach of this Agreement and agree that their respective rights and
obligations hereunder shall be enforceable by specific performance, injunction
or other equitable remedy as well as at law or otherwise.
24. ARBITRATION
Any controversies or claims arising out of or relating to this
Agreement or to executive's employment with the company shall be fully and
finally settled by arbitration in the City of Riverside, California under
California law and in accordance with the Commercial Arbitration Rules of the
American Arbitration Association then in effect (the AAA Rules), conducted by
one arbitrator either mutually agreed upon by the company and the executive or
chosen in accordance with the AAA rules.
[signatures begin on the next page]
COMPANY:
VENTURENET CAPITAL, INC.,
A Delaware corporation
By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
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Title: President
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EXECUTIVE:
/s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
