EMPLOYMENT AGREEMENT
EXHIBIT
10.4
THIS
AGREEMENT
is made
as of June 1, 0000
X
X X X X
X X:
IDO
SECURITY INC.,
a
Company incorporated under the laws of Nevada.
(the
"Company")
and
-
XXXXXXX
XXXXXXXX
(the
"Employee")
CONTEXT
OF THIS AGREEMENT
A. The
Company designs, develops, manufactures and sells prototypes, products, know-how
and technologies used in security applications.
B. The
Company wishes to employ the Employee upon the terms and conditions as set
out
herein.
FOR
VALUE
RECEIVED,
the
sufficiency of which is acknowledged, the parties agree as follows:
PART
1
INTERPRETATION
1.1 Definitions.
In this
Agreement, the following terms shall have the following meanings:
"Agreement"
means
this agreement and all schedules attached hereto and all amendments made hereto
and thereto in writing by the parties.
"Business
Day"
means a
day other than a Saturday, Sunday or statutory holiday in the State of New
York.
"Person"
includes individuals, companies, limited partnerships, general partnerships,
joint stock companies, joint ventures, associations, companies, trusts or other
organizations, whether or not legal entities.
1.2 Entire
Agreement.
This
Agreement together with the agreements and other documents to be delivered
pursuant to this Agreement (or other agreements pertaining to employee benefits,
including, without limitation, stock option and bonus plan agreements),
constitute the entire agreement between the parties pertaining to the subject
matter of this Agreement and supersede all prior agreements, understandings,
negotiations and discussions, whether oral or written, of the parties and there
are no warranties, representations or other agreements between the parties
in
connection with the subject matter of this Agreement except as specifically
set
forth in this Agreement and any document delivered pursuant to this Agreement.
No supplement, modification or waiver or termination of this Agreement shall
be
binding unless executed in writing by the party to be bound
thereby.
1.3 Sections
and Headings.
The
division of this Agreement into parts and sections and the insertion of headings
are for convenience of reference only and shall not affect the construction
or
interpretation of this Agreement. The terms "this Agreement", "hereof",
"hereunder" and similar expressions refer to this Agreement and not to any
particular article, section or other portion hereof and include any agreement
or
instrument supplemental or ancillary hereto. Unless something in the subject
matter or context is inconsistent therewith, references herein to parts and
sections are to parts and sections of this Agreement.
1.4 Number
& Gender.
Words
importing the singular number only shall include the plural and vice versa
and
words importing the masculine gender shall include the feminine and neuter
genders and vice versa.
1.5 Applicable
Law.
This
Agreement shall be construed and enforced in accordance with the laws of the
State of New York applicable therein.
1.6 Currency.
Unless
otherwise specified, all references herein to currency shall be references
to
currency of the United States.
1.7 Calculation
of Time.
When
calculating the period of time within which or following which any act is to
be
done or step taken pursuant to this Agreement, the date which is the reference
date in calculating such period shall be excluded. If the last day of such
period is a non Business Day, the period in question shall end on the next
Business Day.
PART
2
APPOINTMENT
AND DUTIES
2.1 Appointment.
The
Company agrees to employ the Employee as its President and interim chief
executive officer upon the terms and conditions contained herein and the
Employee accepts such appointment.
2.2 Term.
The
employment of the Employee hereunder shall commence on the date hereof and
shall
continue for an initial term of one year (the “Initial Term”) unless terminated
in accordance with the provisions of this Agreement. This Agreement shall be
renewed for successive one year terms (each a “Renewal Term”) unless the Company
or Employee indicates in writing, more than 90 days prior to the termination
of
this Initial term or any Renewal term, that it does not intend to renew this
Agreement.
2
2.3 Duties
and Reporting.
The
Employee will report directly to the chairman of the board of directors of
the
Company and shall carry out all duties and responsibilities which are from
time
to time assigned to him by the board of directors.
PART
3
BENEFITS
& EXPENSES
3.1 Gross
Salary.
During
the term hereof, and subject to the performance of the services required to
be
performed hereunder by Employee, the Company shall pay to the Employee for
all
services rendered hereunder, as salary, payable not less often than once per
month and in accordance with the Company 's normal and reasonable payroll
practices, a monthly gross amount equal to U.S. $16,500 (the "Gross Salary").
Until the Company receives permanent financing, $4,500 from each Gross Salary
payment shall be deferred.
3.2 Cell
Phone.
Company
shall provide Employee with a cell phone and pay for its maintenance and use.
3.3 Benefits.
The
Employee shall be entitled to participate in all of the Company's benefit plans
generally available to its senior level employees from time to time.
3.4 Expenses
All
expenses reasonably incurred by the Employee shall be reimbursed, together
with
any applicable sales and goods and services taxes, by the Company within 10
Business Days after presentation by the Employee of proper invoices and receipts
in keeping with the policies of the Company as established from time to time.
3.5 Options.
The
Company intends to adopt a stock option plan by July 15, 2007. The Employee
shall be entitled to participate in the Company stock option plan, pursuant
to
which he will be granted options for 1,200,000 shares of Common Stock of the
Company, in the aggregate, which shall vest and be exercisable as follows:
the
first 525,000 shares of Common Stock shall be fully vested and exercisable
at
$0.17 per share at the time of grant and the balance shall, during the term
of
this Agreement, vest and be exercisable in instalments of 84,375 shares at
the
end of each ninety day period commencing from the date of this Agreement. The
vested options shall be exercisable, in whole or in part upon Employee's sole
discretion, for a period of seven years from the date of this agreement provided
that if Consultant is terminated for cause all vested options must be exercised
within 90 days of termination. The options shall have standard split protection.
The per share exercise price of the options shall be as follows:
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84,375
Shares per traunch
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1st
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2nd
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3rd
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4th
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5th
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6th
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7th
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8th
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Per
share exercise price
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$
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0.25
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$
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0.42
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$
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0.58
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$
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0.72
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$
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0.95
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$
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1.08
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$
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1.17
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$
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1.25
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3
Subject
to this Agreement being in force the Company shall file a registration statement
(form S 8) for all the shares under the employee stock plan by September 30,
2007.
In
the
event that Company or its subsidiary, IDO Security Ltd. grants to employees
or
directors or consultants or managers (other then related to financings or
investments in the Company or its affiliates) options at a lower exercise price
than Employee's options which have not yet vested as contained above, the
Employee’s unvested options shall automatically be re-priced at such lower
exercise price. This section shall not apply to options granted to members
of
Company’s or its affiliates’ board of directors as of this date.
3.6 Vacation.
The
Employee shall be entitled to an aggregate of twenty (20) business days of
vacation per contract year, to be taken at times that are mutually agreeable
to
the parties. The Employee shall take paid vacation (as part of the twenty days
mentioned herein) during Rosh Hashanah, Yom Kippur, Sukkot, Pesach and Shavuot
excluding Chol Hamoed, where such Jewish holidays occur on business days.
Vacation days shall be prorated for any portion of a year to the date of
termination. Vacation days not used in one year may be carried forward or
accumulated for use by Employee in subsequent years.
3.9 Withholding
Tax
Company
shall withhold, or charge Employee with, all taxes and other compulsory payments
as required under applicable law with respect to all payments, benefits and/or
other compensation paid to Employee in connection with his employment with
Company.
PART
4
EMPLOYEE'S
COVENANTS
4.1 Service.
The
Employee shall devote ninety (90%) percent of his time, attention and ability
to
the business of the Company and shall well and faithfully serve the Company
and
shall use his best efforts to promote the interests of the Company. The Employee
appreciates that the Employee's duties may involve significant travel from
the
Employee's place of employment, and the Employee agrees to travel as reasonably
required in order to fulfill the Employee's duties. The Employee may sit on
boards of other companies unless there is a reasonable basis upon which the
Company may deny him the right to do so.
4.2 Duties
and Responsibilities.
The
Employee shall duly and diligently perform all the duties assigned to him while
in the employ of the Company, and shall truly and faithfully account for and
deliver to the Company all money, securities and things of value belonging
to
the Company which the Employee may from time to time receive for, from or on
account of the Company.
4.3 Rules
and Regulations.
The
Employee shall be bound by and shall faithfully observe and abide by all the
rules and regulations of the Company, including xxxxxxx xxxxxxx policies and
underwriter lock ups, from time to time in force which are brought to his
notice.
4
PART
5
CONFIDENTIAL
INFORMATION AND DEVELOPMENTS
5.1 "Confidential
Information"
means
information, whether or not originated by the Employee, that relates to the
business or affairs of the Company, its affiliates, clients or suppliers and
is
confidential or proprietary to, about or created by the Company, its affiliates,
clients, or suppliers. Confidential Information includes, but is not limited
to,
the following types of confidential information and other proprietary
information of a similar nature (whether or not reduced to writing or designated
or marked as confidential):
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(i)
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work
product resulting from or related to work or projects performed for
or to
be performed for the Company or its affiliates, including but not
limited
to, the interim and final lines of inquiry, hypotheses, research
and
conclusions related thereto and the methods, processes, procedures,
analysis, techniques and audits used in connection therewith;
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(ii)
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computer
software of any type or form and in any stage of actual or anticipated
development, including but not limited to, programs and program modules,
routines and subroutines, procedures, algorithms, design concepts,
design
specifications (design notes, annotations, documentation, flowcharts,
coding sheets, and the like), source code, object code and load modules,
programming, program patches and system designs;
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(iii)
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information
relating to developments (as hereinafter defined) prior to any public
disclosure thereof, including but not limited to, the nature of the
developments, production data, technical and engineering data, test
data
and test results, the status and details of research and development
of
products and services, and information regarding acquiring, protecting,
enforcing and licensing proprietary rights (including patents, copyrights
and trade secrets);
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(iv)
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internal
Company personnel and financial information, vendor names and other
vendor
information, purchasing and internal cost information, internal services
and operational manuals, and the manner and method of conducting
the
Company's business;
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(v)
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marketing
and development plans, price and cost data, price and fee amounts,
pricing
and billing policies, quoting procedures, marketing techniques and
methods
of obtaining business, forecasts and forecast assumptions and volumes,
and
future plans and potential strategies of the Company that have been
or are
being discussed; and
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(vi)
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all
information that becomes known to the Employee as a result of employment
that the Employee, acting reasonably, believes is confidential information
or that the Company takes measures to
protect.
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5
5.2 Confidential
Information does not include:
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(i)
|
the
general skills and experience gained during the Employee's employment
or
engagement with the Company that the Employee could reasonably have
been
expected to acquire in similar employment or engagements with other
companies;
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(ii)
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information
publicly known without breach of this Agreement or similar agreements;
or
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(iii)
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information,
the disclosure of which is required to be made by any law, regulation,
governmental authority or court (to the extent of the requirement),
provided that before disclosure is made, notice of the requirement
is
provided to the Company, and to the extent of the requirement, (to
the
extent reasonably possible in the circumstances) the Company is afforded
an opportunity to dispute the
requirement.
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5.3 "Developments"
means
all discoveries, inventions, designs, works of authorship, improvements and
ideas (whether or not patentable or copyrightable) and legally recognized
proprietary rights (including, but not limited to, patents, copyrights,
trademarks, topographies, know how and trade secrets), and all records and
copies of records relating to the foregoing, that relates solely to the
Company's business and improvements and modifications to it:
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(i)
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result
or derive from the Employee's employment or from the Employee's knowledge
or use of Confidential Information;
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||
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(ii)
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are
conceived or made by the Employee (individually or in collaboration
with
others) during the term of the Employee's employment by the
Company;
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(iii)
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result
from or derive from the use or application of the resources of the
Company
or its affiliates; or
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(iv)
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relate
to the business operations of or actual or demonstrably anticipated
research and development by the Company or its
affiliates.
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For
greater certainty, discoveries, inventions, designs, works of authorship,
improvements and ideas (whether or not patentable or copyrightable) of the
Employee that do not relate to the business of the Company are not the subject
matter of this Agreement.
PART
6
NO
CONFLICTING OBLIGATIONS
6.1 The
Employee warrants to the Company that:
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(i)
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the
performance of the Employee's duties as an employee of the Company
will
not breach any agreement or other obligation to keep confidential
the
proprietary information of any other party; and
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(ii)
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the
Employee is not bound by any agreement with or obligation to any
other
party that conflicts with the Employee's obligations as an employee
of the
Company or that may affect the Company's interest in the
Developments.
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6
6.2 The
Employee will not, in the performance of the Employee's duties as an employee
of
the Company:
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(i)
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improperly
bring to the Company or use any trade secrets, confidential information
or
other proprietary information of any other party; or
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(ii)
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knowingly
infringe the intellectual property rights of any other
party.
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PART
7
COMPETITION
AND SOLICITATION
7.1 Definitions.
"Competitive
Business"
means
any business that supplies products or services competitive with those then
supplied by the Company or which the Company was contemplating supplying when
the Employee was employed by the Company.
"Employment
Period"
means
the period during which the Employee is employed by the Company.
"Termination
Date"
means
the date that the Employee's employment with the Company is terminated
or expires in accordance with Section 2.2 or Part 12.
7.2 Non-Competition.
The
Employee acknowledges that employment by the Company will give the Employee
access to the Confidential Information, and that the Employee's knowledge of
the
Confidential Information will enable the Employee to put the Company at a
significant competitive disadvantage if the Employee is employed or engaged
by
or becomes involved in a Competitive Business. Accordingly, during the
Employment Period and for one year after the Termination Date, the Employee
will
not, directly or indirectly, individually or in partnership or in conjunction
with any other Person:
(i)
be
engaged, directly or indirectly, in any manner whatsoever, including, without
limitation, either individually or in partnership, jointly or in conjunction
with any other person, or as an employee, consultant, adviser, principal, agent,
member or proprietor in any Competitive Business;
(ii)
be
engaged, directly or indirectly, in any manner whatsoever, including, without
limitation, either individually or in partnership, jointly or in conjunction
with any other person, or as an employee, consultant, adviser, principal, agent,
member or proprietor in any Competitive Business in a capacity in which the
loyal and complete fulfilment of the Employee's duties to that Competitive
Business would (i) inherently require that the Employee use, copy or transfer
Confidential Information, or (ii) make beneficial any use, copy or transfer
of
Confidential Information; or
7
(iii)
advise, invest in, lend money to, guarantee the debts or obligations of, or
otherwise have any other financial or other interest (including an interest
by
way of royalty or other compensation arrangements) in or in respect of any
Person which carries on a Competitive Business.
The
restriction in Subsection 7.2 (iii) will not prohibit the Employee from holding
not more than 5% of the issued shares of a public company listed on any
recognized stock exchange or traded on any bona
fide
"over
the counter" market anywhere in the world.
For
greater certainty, the Employee's obligations under this Section are in addition
to the obligations respecting disclosure and use of Confidential Information
in
Part 8.
7.3 No
Solicitation of Clients and Suppliers.
The
Employee acknowledges the importance to the business carried on by the Company
of the client and supplier relationships developed by it and the unique
opportunity that the Employee's employment and the Employee's access to the
Confidential Information offers to interfere with these relationships.
Accordingly, the Employee will not during the Employment Period and for a period
of 12 months thereafter directly or indirectly, contact or solicit any person
who the Employee knows to be a prospective, current or former client or supplier
of Company (who, in the case of a former client or supplier of the Company,
has
had dealings with the Company at any time during the 12 month period immediately
prior to the end of the Employment Period) for the purpose of selling to the
client or buying from the supplier any products or services that are the same
as
or substantially similar to, or in any way competitive with, the products or
services sold or purchased by Company during the Employee's employment or at
the
end thereof, as the case may be.
7.4 No
Solicitation of Employees.
The
Employee acknowledges the importance to the business carried on by the Company
of the human resources engaged and developed by it and the unique access that
the Employee's employment offers to interfere with these resources. Accordingly,
the Employee will not during the Employment Period and for a period of 2 years
thereafter, induce or solicit, attempt to induce or solicit or assist any third
party in inducing or soliciting any employee or consultant of the Company,
to
leave the Company or to accept employment or engagement elsewhere.
7.5 Independent
Covenants.
Each of
Subsections 7.2 and 7.3 will be construed as constituting obligations
independent of any other obligations in this Agreement. The existence of any
claim or cause of action the Employee may have or assert against the Company,
whether based on this Agreement or otherwise, will not constitute a defence
to
the enforcement by the Company of any of the covenants and agreements in the
foregoing sections.
PART
8
CONFIDENTIAL
INFORMATION
8.1 Protection
of Confidential Information.
All
Confidential Information, whether it is developed by the Employee during the
Employment Period or by others employed or engaged by or associated with the
Company or its affiliates or clients, is the exclusive and confidential property
of the Company or its affiliates or clients, as the case may be, and will at
all
times be regarded, treated and protected as such, as provided in this
Agreement.
8
8.2 Covenants
Respecting Confidential Information.
As a
consequence of the acquisition of Confidential Information, the Employee will
occupy a position of trust and confidence with respect to the affairs and
business of the Company and its affiliates and clients. In view of the
foregoing, it is reasonable and necessary for the Employee to make the following
covenants regarding the Employee's conduct during and subsequent to the
Employee's employment by the Company.
8.3 Non
Disclosure.
At all
times during and subsequent to the Employee's employment with the Company,
the
Employee will not disclose Confidential Information to any Person (other than
as
necessary in carrying out the Employee's duties on behalf of the Company)
without first obtaining the Company's consent, and the Employee will take all
reasonable precautions to prevent inadvertent disclosure of any Confidential
Information. This prohibition includes, but is not limited to, disclosing or
confirming the fact that any similarity exists between the Confidential
Information and any other information.
8.4 Using,
Copying, etc.
At all
times during and subsequent to the Employee's employment with the Company,
the
Employee will not use, copy, transfer or destroy any Confidential Information
(other than as necessary in carrying out the Employee's duties on behalf of
the
Company) without first obtaining the Company's consent, and the Employee will
take all reasonable precautions to prevent inadvertent use, copying, transfer
or
destruction of any Confidential Information. This prohibition includes, but
is
not limited to, licensing or otherwise exploiting, directly or indirectly,
any
products or services that embody or are derived from Confidential Information
or
exercising judgment or performing analysis based upon knowledge of Confidential
Information.
8.5 Return
of Confidential Information.
Within
2 Business Days after the termination of the Employee's employment on any basis
and of receipt by the Employee of the Company's written request, the Employee
will promptly deliver to the Company all property of or belonging to or
administered by Company including without limitation all Confidential
Information that is embodied in any physical or ephemeral form, whether in
hard
copy or on magnetic media, and that is within the Employee's possession or
under
the Employee's control.
8.6 Obligations
Continue.
The
Employee's obligations under this Part 8 are to remain in effect in
perpetuity.
PART
9
INTELLECTUAL
PROPERTY
9.1 Ownership.
All
Developments will be the exclusive property of the Company and the Company
will
have sole discretion to deal with Developments. For greater certainty, all
work
done during the Employment Period by the Employee for the Company or its
affiliates is a work for hire of which the Company or its affiliate, as the
case
may be, is the first author for copyright purposes and in respect of which
all
copyright will vest in the Company or the relevant affiliate, as the case may
be.
9
9.2 Records.
The
Employee will keep complete, accurate and authentic notes, reference materials,
data and records of all Developments in the manner and form requested by the
Company. All these materials will be Confidential Information upon their
creation.
9.3 Moral
Rights.
The
Employee hereby irrevocably waives all moral rights arising under statute in
any
jurisdiction or under common law which the employee may have now or in the
future with respect to the Developments, including, without limitation, any
rights the Employee may have to have the Employee's name associated with the
Developments or to have the Employee's name not associated with the
Developments, any rights the Employee may have to prevent the alteration,
translation or destruction of the Developments, and any rights the Employee
may
have to control the use of the Developments in association with any product,
service, cause or institution. The Employee agrees that this waiver may be
invoked by the Company, and by any of its authorized agents or assignees, in
respect of any or all of the Developments and that the Company may assign the
benefit of this waiver to any Person.
9.4 Further
Assurances.
The
Employee will do all further things that may be reasonably necessary or
desirable in order to give full effect to the foregoing. If the Employee's
co-operation is required in order for the Company to obtain or enforce legal
protection of the Developments following the termination of the Employee's
employment, the Employee will provide that co-operation so long as the Company
pays to the Employee reasonable compensation for the Employee's time at a rate
to be agreed, provided that the rate will not be less than the last base salary
or compensation rate paid to the Employee by the Company during the Employee's
employment.
PART
10
CONSENT
TO ENFORCEMENT
The
Employee confirms that all restrictions in Part 8 and 9 are reasonable and
valid
and all defences to the strict enforcement thereof by the Company are waived
by
the Employee. Without limiting the generality of the forgoing, the Employee
hereby consents to an injunction being granted by a court of competent
jurisdiction in the event that the Employee is in any breach of any of the
provisions stipulated in Part 8 and 9. The Employee hereby expressly
acknowledges and agrees that injunctive relief is an appropriate and fair remedy
in the event of a breach of any of the said provisions.
PART
11
WARRANTIES,
COVENANTS AND REMEDIES
11.1
The
obligations of the Employee as set forth in Parts 6 through 9 will be deemed
to
have commenced as of the date on which the Employee was first employed by
Company. The Employee warrants that the Employee has not, to date, breached
any
of the obligations set forth in any of those Sections. Any breach or threatened
breach of those sections by the Employee will constitute Just Cause for
immediate termination of the Employee's employment or engagement by the
Company.
10
11.2
The
Employee understands that the Company has expended significant financial
resources in developing its products and the Confidential Information.
Accordingly, a breach or threatened breach by the Employee of any of Parts
6
through 9 could result in unfair competition with the Company and could result
in the Company and its shareholders suffering irreparable harm that is not
capable of being calculated and that cannot be fully or adequately compensated
by the recovery of damages alone. Accordingly, the Employee agrees that the
Company will be entitled to interim and permanent injunctive relief, specific
performance and other equitable remedies, in addition to any other relief to
which the Company may become entitled.
11.3
The
Employee's obligations under each of Parts 6 through 9 are to remain in effect
in accordance with each of their terms and will exist and continue in full
force
and effect despite any breach or repudiation, or alleged breach or repudiation,
of this Agreement or the Employee's employment (including, without limitation,
the Employee's wrongful dismissal) by the Company.
PART
12
TERMINATION
12.1
Termination
by the Employee.
The
Employee may terminate this Agreement upon 60 Business Days prior written notice
given by the Employee to the Company. The Company, at its sole discretion,
may
elect to accept the 60 Business Days written notice or to reduce or eliminate
the notice period. In such event, the Employee's employment shall terminate
on
the earlier day elected by the Company. Such election on the part of the Company
will not alter the nature of the termination as voluntary and the Company will
not be required to pay any severance or termination payments in respect of
a
termination by the Employee under this Section 12.1. Upon the termination of
employment by the Employee under this Section 12.1 the Company shall pay to
the
Employee all bonuses and other benefits earned or accrued up to the date of
termination, but otherwise all obligations of the Company under this Agreement
shall end.
12.2
Definition
of "Just Cause".
"Just
Cause" means:
(i)
Employee’s conviction of, or plea of nolo contendere, to any felony or to a
crime involving moral depravity or fraud; (ii) Employee’s commission of an act
of dishonesty or fraud or breach of fiduciary duty or act that has a material
adverse effect on the name or public image of the Company, as determined by
the
Board provided the Board affords the Employee the opportunity to personally
appear before the Board in order to state his case prior to the Board voting
to
so terminate the Employee; (iii) Employee’s commission of an act of willful
misconduct or gross negligence, as determined by the Board provided the Employee
shall have the opportunity to state his case before the Board prior to the
Board
taking such decision to so terminate the Employee; (iv) the failure of Employee
to perform his duties under this Agreement; (v) the material breach of any
of
Employee’s material obligations under this Agreement; (vi) the failure of
Employee to follow a directive of the Board; or (vii) excessive absenteeism,
chronic alcoholism or any other form of addiction that prevents Employee from
performing the essential functions of his position with or without a reasonable
accommodation; provided,
however,
that
the Company may terminate Employee’s employment for Just Cause, as to (iv) or
(v) above, only after failure by Employee to correct or cure, or to commence
or
to continue to pursue the correction or curing of, such conduct or omission
within ten (10) days after receipt by Employee of written notice by the Company
of each specific claim of any such misconduct or failure.
11
12.3
Termination
by the Company for Just Cause.
The
Company may terminate this Agreement at any time for Just Cause without notice
and (except as provided in the immediately following sentence) without payment
of any compensation by way of anticipated earnings, damages, or other relief
of
any kind whatsoever. Upon the termination of employment by the Company for
Just
Cause, the Company shall pay to the Employee all salaries, bonuses, vacation
and
other benefits, if any, earned or accrued up to the date of termination, and
severance pay as set out Section 3.2, but otherwise all obligations of the
Company under this Agreement end.
12.4
Termination
by the Company for Other Than Just Cause.
The
Company may terminate this Agreement at any time for other than Just Cause
upon
the following terms:
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(a)
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(i)
if the Company so terminates this Agreement at any time during the
Initial
Term of this Agreement, the Company shall pay to the Employee an
amount
equal to the base salary then payable, if any, for the period from
the
date of such termination to the end of the Initial Term as if the
Agreement had not been so terminated, and (ii) if the Company so
terminates this Agreement at any time during a Renewal Term of this
Agreement, the Company shall pay to the Employee an amount equal
to the
base salary then payable, if any, for a period of three months;
and
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(b)
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upon
any such termination, all bonuses or other benefits earned or accrued
up
to the date of termination or expiry shall be paid by the Company,
but
except for such payments and the payments to be made pursuant to
Sections
12.4(a) or (b), as applicable, all obligations of the Company under
this
Agreement shall end upon such termination or failure to renew. Payments
under Sections 12.4(a) or (b) shall be payable monthly subject to
deductions in Section 3.4.
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12.5
Termination
by the Employee for Good Reason.
The
Employee may terminate this Agreement at any time upon the occurrence of any
of
the following events (each a "Good
Reason"),
if
such occurrence takes place without the express written consent of the
Employee:
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(i)
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a
change in the Employee's title or position or a material diminution
in the
Employee's duties or the assignment to the Employee of duties which
materially impairs the Employee's ability to function in his current
capacity for the Company, or, with respect an assignment of duties
only,
is materially inconsistent with his duties;
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(ii)
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any
material change in the Employee's direct reporting obligations;
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provided
that this section 12.5 shall not apply with respect Employee’s position as
interim chief executive officer or lessening of duties as a result of Company
retaining a permanent CEO.
In
the
event that the Employee terminates this Agreement for Good Reason, he shall
be
entitled to the same payments and benefits as provided in Section 12.4 of this
Agreement as if the Company had terminated this Agreement at the time that
the
Employee terminates this Agreement under this Section 12.5.
12
12.6
Full
and Final Release.
In
order to be eligible for the payments as set forth in this Section 12 the
Employee must (i) execute and deliver to the Company a general release, in
a
form satisfactory to the Company, and (ii) be and remain in full compliance
with
his obligations under this Agreement.
12.7 Fair
and Reasonable.
The
parties confirm that the provisions contained in Sections 12.4 and 12.5 are
fair
and reasonable and that all such payments shall be in full satisfaction of
all
claims which the Employee may otherwise have at law against the Company
including, or in equity by virtue of such termination of
employment.
12.8
Return
of Property.
Upon
the termination of the Employee's employment for any reason whatsoever, the
Employee shall at once deliver or cause to be delivered to the Company all
books, documents, effects, money, computer equipment, computer storage media,
securities or other property belonging to the Company or for which the Company
is liable to others, which are in the possession, charge, control or custody
of
the Employee.
12.9
Provisions
Which Operate Following Termination.
Notwithstanding any termination of this Agreement for any reason whatsoever,
provisions of this Agreement necessary to give efficacy thereto shall continue
in full force and effect.
12.10
Board.
Notwithstanding the foregoing, the termination of Employee’s employment
hereunder for any reason shall automatically be deemed as Employee’s resignation
from the Board of Directors of the Company and any affiliates without any
further action, except when the Board shall, in writing, request a continuation
of duty as a Director in its sole discretion.
PART
13
GENERAL
13.1
Benefit
& Binding.
This
Agreement shall enure to the benefit of and be binding upon the respective
successors and permitted assigns of the parties hereto.
13.2
Amendments
& Waivers.
No
amendment to this Agreement shall be valid or binding unless set forth in
writing and duly executed by all of the parties hereto. No waiver of any breach
of any provision of this Agreement shall be effective or binding unless made
in
writing and signed by the party purporting to give the same and, unless
otherwise provided in the written waiver, shall be limited to the specific
breach waived.
13.3
Time.
Time
shall be of the essence of this Agreement.
13.4
Assignment.
Neither
this Agreement nor the rights and obligations hereunder shall be assignable
by
either party without the consent of the other.
13
13.5 Severability.
If any
provision of this Agreement is determined to be invalid or unenforceable in
whole or in part, such invalidity or unenforceability shall attach only to
such
provision and all other provisions hereof shall continue in full force and
effect.
13.6
Attornment.
For the
purposes of all legal proceedings this Agreement shall be deemed to have been
performed in the State of New York.
PART
14
ACKNOWLEDGEMENT
The
Employee acknowledges that:
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(i)
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the
Employee has received a copy of this Agreement;
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(ii)
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the
Employee has had sufficient time to review and consider this Agreement
thoroughly;
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(iii)
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the
Employee has read and understands the terms of this Agreement and
his
obligations under this Agreement;
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(iv)
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the
restriction placed upon the Employee by this Agreement are reasonably
necessary to protect the Company's proprietary interests in the
Confidential Information and the Developments and will not preclude
the
Employee from being gainfully employed in a suitable capacity following
the termination of the Employee's employment, give the Employee's
knowledge and experience;
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(v)
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the
Employee has been given an opportunity to obtain independent legal
advice,
or such other advice as the Employee may desire, concerning the
interpretation and effect of this Agreement and by signing this Agreement
the Employee has either obtained advice or voluntarily waived the
Employee's opportunity to receive the same; and
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(vi)
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this
Agreement is entered into voluntarily by the
Employee.
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PART
15
NOTICES
Any
demand, notice or other communication (the "Notice")
to be
given in connection with this Agreement shall be given in writing on a Business
Day and may be given by personal delivery or by transmittal by facsimile
addressed to the recipient as follows:
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To
the Company:
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00
Xxxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Attention:
Board of Directors
Facsimile:
000- 000-0000
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14
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To
the Employee:
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Facsimile:
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or
such
other address or facsimile number as may be designated by notice by any party
to
the other. Any Notice given by personal delivery will be deemed to have been
given on the day of actual delivery and if transmitted by facsimile before
3:00
pm on a Business Day, will be deemed to have been given on that Business Day
and
if transmitted by facsimile after 3:00 pm on a Business Day, will be deemed
to
have been given on the next Business Day after the date of
transmission.
PART
16
FURTHER
ASSURANCES
The
parties shall from time to time execute and deliver all such further documents
and do all acts and things as the other party may reasonably require to
effectively carry out or better evidence or perfect the full intent and meaning
of this Agreement.
PART
17
FAX
SIGNATURES
This
Agreement may be signed either by original signature or by facsimile
signature.
PART
18
COUNTERPARTS
This
Agreement may be executed by the parties in one or more counterparts, each
of
which when so executed and delivered shall be an original and such counterparts
shall together constitute one and the same instrument.
15
IN
WITNESS WHEREOF
the
parties have duly executed this Agreement.
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/s/
Xxxx Xxxxxx
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Per:
Director
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/s/
Xxxxxxx Xxxxxxxx
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XXXXXXX
XXXXXXXX
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