EXHIBIT 10.7
EMPLOYMENT AGREEMENT DATED MARCH 25, 2003
WITH XXXXXXX XXXXX
EMPLOYMENT AGREEMENT
AGREEMENT dated as of March 25, 2003 between I-Track, Inc., a Nevada
corporation (the "EMPLOYER" or the "COMPANY"), and Xxxxxxx Xxxxx (the
"EMPLOYEE").
W I T N E S E T H :
WHEREAS, the Employer desires to continue to employ the Employee as its
President and Chief Executive Officer and to be assured of his services as such
on the terms and conditions hereinafter set forth;
WHEREAS, the Employee is willing to continue such employment on such
terms and conditions; and
WHEREAS, the parties wish to memorialize their mutual agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, and intending to be legally bound hereby, the Employer
and the Employee hereby agree as follows:
1. TERM. Employer hereby agrees to employ Employee, and Employee hereby
agrees to serve Employer for a ten year period commencing effective as of the
date each party executes this Agreement (such period being herein referred to as
the "INITIAL TERM"). After the Initial Term, this Agreement shall be renewable
automatically for successive one year periods (each such period being referred
to as a "RENEWAL TERM"), unless, more than thirty days prior to the expiration
of the Initial Term or any Renewal Term, either the Employee or the Company give
written notice that employment will not be renewed.
2. EMPLOYEE DUTIES.
(a) During the term of this Agreement, the Employee shall have the
duties and responsibilities of President and Chief Executive Officer of the
Employer, reporting directly to the Board of Directors of the Employer (the
"BOARD"). It is understood that such duties and responsibilities shall be
reasonably related to the Employee's position.
(b) The Employee shall devote such amount (as necessary, as mutually
required by the Employee and the Board) of his business time, attention,
knowledge and skills faithfully, diligently and to the best of his ability, to
furtherance of the business and activities of the Company.
3. COMPENSATION. In return for the services of the Employee set forth
herein, the Company shall pay to the Employee a salary ("Salary") of One Hundred
Twenty Thousand ($120,000) per annum during the first year of the term of this
Agreement. The Salary shall increase cumulatively at the rate of ten percent
(10%) per annum every year commencing on the first anniversary of this
Agreement. The Company shall also provide health insurance coverage. In addition
to the Salary the Employee shall be entitled such bonuses when and as declared
by the Board of Directors of the Company. The Salary shall be paid by the
Company pursuant to the Company's normal payroll practices but no less than once
per month.
4. TRAVEL EXPENSES. All travel and other expenses incident to the
rendering of services reasonably incurred on behalf of the Company by the
Employee during the term of this Agreement shall be paid by the Employer. If any
such expenses are paid in the first instance by the Employee, the Employer shall
reimburse him therefore on presentation of appropriate receipts for any such
expenses.
5. TERMINATION. Notwithstanding the provisions of Section 1 hereof, the
Employee's employment with the Employer may be earlier terminated as follows:
(a) By action taken by the Board, the Employee may be discharged for
cause (as hereinafter defined), effective as of such time as the Board shall
determine. Upon discharge of the Employee pursuant to this Section 5(a), the
Employer shall have no further obligation or duties to the Employee, and the
Employee shall have no further obligations or duties to the Employer, except as
provided in Section 6.
(b) In the event of termination due to (i) the death of the Employee or
(ii) by action of the Board and the inability of the Employee, by reason of
physical or mental disability, to continue substantially to perform his duties
hereunder for a period of 180 consecutive days, the Employer shall have no
further obligations or duties to the Employee, except for the payment of the
Salary then in effect for a period of two years after the date of such
termination.
(c) In the event that Employee's employment with the Employer is
terminated by action taken by the Board without cause, including termination
upon a Change in Control (as hereinafter defined), then the Employer shall have
no further obligation or duties to Employee, except for the payment of the
Salary due to the Employee for the remainder of the term of this Agreement, and
Employee shall have no further obligations or duties to the Employer, except as
provided in Section 6. IN the event termination under this subsection occurs
within four years of the expiration of the term of this Agreement, the Company
shall pay the Employee the Salary in effect during the last five years of the
term of this Agreement. Such payment shall be made within ten business days
after such termination.
(d) For purposes of this Agreement, the Company shall have "cause" to
terminate the Employee's employment under this Agreement upon (i) the engaging
by the Employee in criminal misconduct (including embezzlement and criminal
fraud) which is materially injurious to the Company, monetarily or otherwise,
(ii) the conviction of the Employee of a felony or (iii) gross negligence on the
part of the Employee, which notice shall specify the grounds for the proposed
termination.
(e) For purposes of this Agreement a "CHANGE IN CONTROL" shall be
deemed to occur, unless previously consented to in writing by the Employee, upon
the election of directors constituting a majority of the Board who have not been
nominated or approved by the Employee and are not related to the Employee.
6. CONFIDENTIALITY; NONCOMPETITION.
(a) The Employer and the Employee acknowledge that the services to be
performed by the Employee under this Agreement are unique and extraordinary and,
as a result of such employment, the Employee will be in possession of
confidential information relating to the business practices of the Company. The
term "Confidential Information" shall mean any and all information (verbal and
written) relating to the Company or any of its affiliates, or any of their
respective activities, other than such information which can be shown by the
Employee to be in the public domain (such information not being deemed to be in
the public domain merely because it is embraced by more general
information which is in the public domain) other than as the result of breach of
the provisions of this Section 6(a), including, but not limited to, information
relating to: trade secrets, formulas, personnel lists, financial information,
research projects, services used, pricing, customers, customer lists and
prospects, product sourcing, marketing and selling and servicing. The Employee
agrees that he will not, during or for a period of one year after the
termination of employment, directly or indirectly, use, communicate, disclose or
disseminate to any person, firm or corporation any confidential information
regarding the clients, customers or business practices of the Company acquired
by the Employee during his employment by Employer, without the prior written
consent of Employer; provided, however, that the Employee understands that
Employee will be prohibited from misappropriating any trade secret at any time
during or after the termination of employment.
(b) The Employee hereby agrees that he shall not, during the period of
his employment and for a period of one (1) year following such employment,
directly or indirectly, within any county (or adjacent county) in any State
within the United States or territory outside the United States in which the
Company is engaged in business activities during the period of the Employee's
employment or on the date of termination of the Employee's employment, engage,
have an ownership interest of more than twenty five percent (25%) in any
business directly competitive with the Company's business activities as of the
date of this Agreement.
(c) The Employee hereby agrees that he shall not, during the period of
his employment and for a period of one (1) year following such employment,
directly or indirectly, take any action which constitutes an interference with
or a disruption of any of the Company's business activities including, without
limitation, the solicitations of the Company's customers, or persons listed on
the personnel lists of the Company. At no time during the term of this Agreement
shall the Employee directly or indirectly, disparage the commercial, business or
financial reputation of the Company.
(d) For purposes of clarification, but not of limitation, the Employee
hereby acknowledges and agrees that the provisions of subparagraphs 6(b) and (c)
above shall serve as a prohibition against him, during the period referred to
therein, directly or indirectly, hiring, offering to hire, enticing, soliciting
or in any other manner persuading or attempting to persuade any officer,
employee, agent, lessor, lessee, licensor, licensee or customer who has been
previously contacted by either a representative of the Company, including the
Employee, (but only those suppliers existing during the time of the Employee's
employment by the Company, or at the termination of his employment), to
discontinue or alter his, her or its relationship with the Company.
(e) Upon the termination of the Employee's employment for any reason
whatsoever, all documents, records, notebooks, equipment, price lists,
specifications, programs, customer and prospective customer lists and other
materials which refer or relate to any aspect of the business of the Company
which are in the possession of the Employee including all copies thereof, shall
be promptly returned to the Company.
(f) The Employee agrees that all processes, technologies and inventions
("Inventions"), including new contributions, improvements, ideas and
discoveries, whether patentable or not, conceived, developed, invented or made
by him during his employment by Employer shall belong to the Company, provided
that such Inventions grew out of the Employee's work with the Company, are
related in any manner to the business (commercial or experimental) of the
Company, or are conceived or made on the Company's time or with the use of the
Company's facilities or materials. The Employee shall further: (a) promptly
disclose such Inventions to the Company; (b) assign to the Company, without
additional compensation, all such patent and other rights to such Inventions for
the United
States and foreign countries; (c) sign all papers necessary to carry out the
foregoing; and (d) give testimony in support of his inventorship.
(g) The Company shall be the sole owner of all products and proceeds of
the Employee's services hereunder, including, but not limited to, all materials,
ideas, concepts, formats, suggestions, developments, arrangements, packages,
programs and other intellectual properties that the Employee may acquire,
obtain, develop or create in connection with and during the term of the
Employee's employment hereunder, free and clear of any claims by the Employee
(or anyone claiming under the Employee) of any kind or character whatsoever
(other than the Employee's right to receive compensation hereunder). The
Employee shall, at the request of the Company, execute such assignments,
certificates or other instruments as the Company may from time to time deem
necessary or desirable to evidence, establish, maintain, perfect, protect,
enforce or defend its right, or title and interest in or to any such properties.
(h) The parties hereto hereby acknowledge and agree that (i) the
Company would be irreparably injured in the event of a breach by the Employee of
any of his obligations under this Section 6, (ii) monetary damages would not be
an adequate remedy for any such breach, and (iii) the Company shall be entitled
to injunctive relief, in addition to any other remedy which it may have, in the
event of any such breach.
(i) If any provision contained in this Section 6 is hereafter construed
to be invalid or unenforceable, the same shall not affect the remainder of the
covenant or covenants, which shall be given full effect, without regard to the
invalid portions.
(j) If any provision contained in this Section 6 is found to be
unenforceable by reason of the extent, duration or scope thereof, or otherwise,
then the court making such determination shall have the right to reduce such
extent, duration, scope or other provision and in its reduced form any such
restriction shall thereafter be enforceable as contemplated hereby.
(k) It is the intent of the parties hereto that the covenants contained
in this Section 6 shall be enforced to the fullest extent permissible under the
laws and public policies of each jurisdiction in which enforcement is sought
(the Employee hereby acknowledging that said restrictions are reasonably
necessary for the protection of the Company). Accordingly, it is hereby agreed
that if any of the provisions of this Section 6 shall be adjudicated to be
invalid or unenforceable for any reason whatsoever, said provision shall be
(only with respect to the operation thereof in the particular jurisdiction in
which such adjudication is made) construed by limiting and reducing it so as to
be enforceable to the extent permissible, without invalidating the remaining
provisions of this Agreement or affecting the validity or enforceability of said
provision in any other jurisdiction.
7. INDEMNIFICATION. The Employer shall indemnify and hold harmless the
Employee against any and all expenses reasonably incurred by him in connection
with or arising out of (a) the defense of any action, suit or proceeding in
which he is a party, or (b) any claim asserted or threatened against him, in
either case by reason of or relating to his being or having been an employee,
officer or director of the Company, whether or not he continues to be such an
employee, officer or director at the time of incurring such expenses, except
insofar as such indemnification is prohibited by law. Notwithstanding the
foregoing, the Employer shall not indemnify the Employee in connection with or
arising out of any action caused by Employers gross negligence or breach of
fiduciary duty. Such expenses shall include, without limitation, the fees and
disbursements of attorneys, amounts of judgments and amounts of any settlements,
provided that such expenses are agreed to in advance by the Employer. The
foregoing
indemnification obligation is independent of any similar obligation provided in
the Employer's Certificate of Incorporation or Bylaws, and shall apply with
respect to any matters attributable to periods prior to the date of this
Agreement, and to matters attributable to his employment hereunder, without
regard to when asserted.
8. GENERAL. This Agreement is further governed by the following provisions:
(a) NOTICES. All notices relating to this Agreement shall be in writing
and shall be either personally delivered, sent by telecopy (receipt confirmed)
or mailed by certified mail, return receipt requested, to be delivered at such
address as is indicated below, or at such other address or to the attention of
such other person as the recipient has specified by prior written notice to the
sending party. Notice shall be effective when so personally delivered, one
business day after being sent by telecopy or five days after being mailed.
To the Employer:
Xx. Xxxx Xxxxx
Vice President and Chief Financial Officer, Secretary
I-Track, Inc.
0000 Xxxxx Xx., Xxxxx #000
Xxxxxx Xxxx, XX 00000
Phone: 000-000-0000
Facsimile: 000-000-0000
To the Employee:
Mr. Xxxxxxx Xxxxx
0000 Xxxxxxx Xx.
Xxxxxx Xxxx, XX 00000
Phone: 000-000-0000
(b) PARTIES IN INTEREST. Employee may not delegate his duties or assign
his rights hereunder. This Agreement shall inure to the benefit of, and be
binding upon, the parties hereto and their respective heirs, legal
representatives, successors and permitted assigns.
(c) ENTIRE AGREEMENT. This Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto with respect
to the employment of the Employee by the Employer and contains all of the
covenants and agreements between the parties with respect to such employment in
any manner whatsoever. Any modification or termination of this Agreement will be
effective only if it is in writing signed by the party to be charged.
(d) GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Colorado. Employee agrees to and hereby
does submit to jurisdiction before any state or federal court of record in the
State of Colorado, or in the state and county in which such violation may occur,
at Employer's election.
(e) WARRANTY. Employee hereby warrants and represents as follows:
(i) That the execution of this Agreement and the discharge of
Employee's obligations hereunder will not breach or conflict with any
other contract, agreement, or understanding between Employee and any
other party or parties.
(ii) Employee has ideas, information and know-how relating to the
type of business conducted by Employer, and Employee's disclosure of
such ideas, information and know-how to Employer will not conflict with
or violate the rights of any third party or parties.
(f) SEVERABILITY. In the event that any term or condition in this
Agreement shall for any reason be held by a court of competent jurisdiction to
be invalid, illegal or unenforceable in any respect, such invalidity, illegality
or unenforceability shall not affect any other term or condition of this
Agreement, but this Agreement shall be construed as if such invalid or illegal
or unenforceable term or condition had never been contained herein.
(g) EXECUTION IN COUNTERPARTS. This Agreement may be executed by the
parties in one or more counterparts, each of which shall be deemed to be an
original but all of which taken together shall constitute one and the same
agreement, and shall become effective when one or more counterparts has been
signed by each of the parties hereto and delivered to each of the other parties
hereto.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.
I-Track, Inc.
By:
-----------------------------------
Name: Xxxx Xxxxx
Title: Secretary
--------------------------------------
Xxxxxxx Xxxxx
