AMENDED AND RESTATED TERMINATION AGREEMENT
AND TERMINATION OF CONSULTING AGREEMENT
AMENDED AND RESTATED TERMINATION AGREEMENT (the "Agreement") dated as of
July 2, 1999 (the "Effective Date") between XXXX XXXXXXXXXX (the "Executive"),
residing at 000 Xxxx Xxx, Xxxxxxxx, Xxx Xxxx 00000 and COMPU-XXXX, INC., a
Delaware corporation (the "Company"), having its principal place of business at
00 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxx Xxxx 00000.
RECITALS
WHEREAS, Executive was employed by the Company as its President, Chief
Executive Officer and Secretary in accordance with that certain Restated and
Amended Employment Agreement dated March 4, 1997, as amended as of January 8,
1999 ( the "Employment Agreement"); and
WHEREAS, the Company and Executive entered into that certain Termination
Agreement (the "Termination Agreement") dated as of May 11, 1999 whereby, among
other things, the Company and Executive agreed to terminate the Employment
Agreement; and
WHEREAS, the Company and Executive entered into that certain Consulting
Agreement (the "Consulting Agreement") dated as of May 11, 1999 whereby, among
other things, Executive agreed to provide consulting services to the Company and
the Company issued and agreed to register 62,500 shares of common stock of the
Company; and
WHEREAS, the Company and Executive desire to terminate the Consulting
Agreement on the basis herein provided; and
WHEREAS, the Company and Executive desire to amend and restate the
Termination Agreement on the basis herein provided; with the provisions of this
Agreement to supercede and control, in all respects, the Consulting Agreement
and the Termination Agreement.
NOW, THEREFORE, upon the agreements and covenants set forth herein, the
parties hereto agree as follows:
1. Employment Termination. The parties acknowledge and agree that,
effective at the close of business on May 11, 1999, the Executive's employment
with the Company as its President, Chief Executive Officer and Secretary was
terminated. Accordingly, the Employment Agreement was terminated and remains of
no further force or effect, and neither the Executive nor the Company shall have
any further liability or obligation thereunder, except for any salary and
benefits which are earned, accrued and unpaid as of May 11, 1999.
2. Consulting Termination. The parties acknowledge and agree that, as of
the Effective Date, the Executive will no longer be retained by the Company as a
consultant.
Accordingly, except as otherwise provided in this Agreement, the Consulting
Agreement is hereby terminated and of no further force and effect, and neither
the Executive nor the Company shall have any further liability or obligation
thereunder.
3. Payments, Accounting. (a) For and in consideration of the Executive's
entering into this Agreement and performing his obligations hereunder, the
Company has paid to the Executive $166,666.00 (the "Cash Payment") and agrees to
pay to Executive:
(i) Seventy Five Thousand (75,000) shares (the "Shares") of
the Company's common stock (collectively, the Cash Payment and the Shares are
referred to hereinafter as the "Base Termination Amount"). The Base Termination
Amount shall be payable as follows:
(A) Executive acknowledges that the Cash Payment has been
paid to and received by Executive prior to the date hereof;
and
(B) The Shares shall be issued to Executive on the Effective
Date. The Company and Executive acknowledge and agree that
the Shares have not been registered under the Securities Act
of 1933, as amended, and the Company is not under any
obligation to register the Shares at any time in the future.
The Company and the Executive further acknowledge and agree
that, pursuant to Rule 16b-3(d) of the rules promulgated
under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), the Shares are exempt from Section 16(b) of
the Exchange Act.
(ii) In addition to the Base Termination Amount, the Company
simultaneously herewith is selling its business of designing, developing,
licensing, installing and servicing computer software products and systems
predominately for public safety and law enforcement agencies (the "Public Safety
Business") and such sale provides for the payment by Admit Computer Services,
Inc., the buyer thereof (the "Buyer"), to the Company of a royalty (the
"Royalty") based on the revenues derived by the Buyer from the sale or licensing
of products and/or assets acquired in connection with its purchase of the Public
Safety Business, or derived from services related to the sale of such products
and/or assets. The Company agrees that it shall pay to the Executive an amount
equal to eighty percent (80%) of the Royalty (subject to any set-off right Buyer
may have pursuant to the Public Safety Sales Agreement (as hereinafter
defined)), (the "Installment Termination Amount" and, together with the Base
Termination Amount, the "Termination Amount"), for so long as the Royalty shall
be payable by the Buyer, subject to the provisions of Section 4 hereof.
(b) In connection with the sale of the Public Safety Business,
the Company has irrevocably directed the Buyer of the Public Safety Business to
either (i) pay that portion of the Royalty comprising the Installment
Termination Amount directly to the Executive contemporaneously with the Buyer's
payment of the balance of the Royalty to the Company or (ii) pay the entire
Royalty to a third party who will pay to Executive and the Company the portions
of the Royalty to which they are entitled pursuant to this Agreement. The
Company agrees to execute
an irrevocable collateral assignment or other documents sufficient to insure
assignment of the Installment Termination Amount, if deemed necessary by the
Executive.
(c) The Company has designated the Executive as one of its
duly authorized representatives to review and audit the books of account of the
Buyer, or otherwise conduct an accounting of the Buyer with respect to the
Royalty, pursuant to the right to an accounting the Company has obtained with
respect to the Royalty in the Assets Purchase Agreement between the Company and
the Buyer relating to the sale of the Public Safety Business (the "Public Safety
Sale Agreement"). The Company hereby represents and warrants that such an
accounting provision is contained in the Public Safety Sales Agreement which
allows the Company to conduct an accounting of the Buyer with respect to the
Royalties.
(d) The Company shall, upon execution of this Agreement, wire
transfer $10,000.00 (the "Fee Payment") to Xxxxxxx Xxxxxx L.L.P. in partial
payment of the reasonable legal fees and expenses of the Executive incurred by
him in connection with the negotiation, preparation and delivery of this
Agreement including, without limitation, all reasonable fees and expenses due
and payable to Xxxxxxx Xxxxxx L.L.P. and Ruskin, Moscou, Xxxxx & Faltischek,
P.C. in connection herewith. The Company is under no obligation to pay any
amount for such fees and expenses in excess of the Fee Payment. The Fee Payment
shall be wire transferred as follows:
Bank of America
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
ABA #000000000
Credit to: Xxxxxxx Xxxxxx Trust Account
Account #018-07-1344-6
Such amount shall be held in the above referenced trust account until Xxxxxxx
Xxxxxx L.L.P. receives notice from the Company (or its counsel) and Executive
that the closing has occurred. If the closing has not occurred by 5:00 p.m.
Eastern time on July 9, 0000, Xxxxxxx Xxxxxx L.L.P. shall return the Fee Payment
to the Company.
4. Security Interest. The Company has granted to the Executive a valid,
binding and enforceable security interest (the "Security Interest") in any and
all tangible and intangible assets in which the Company has or shall have an
interest, now or hereafter existing or acquired, and wherever located, together
with all additions and accessions thereto and replacements and substitutions
thereof and all proceeds and products of the foregoing, as security for the
payment or performance of the obligations of the Company to the Executive
hereunder. The Parties amended the Security Interest by entering into First
Amendment to Security Agreement dated May 11, 1999 to evidence the security
interest granted in connection with that Amended and Restated Loan Agreement
dated April 30, 1997 by and between the Executive and the Company and the
security interest granted under the Termination Agreement, which amendment was
executed and delivered in connection with the
execution of the Termination Agreement. Upon execution of this Agreement, the
Executive agrees to terminate and relinquish the Security Interest, as amended,
and therefore the security interests described therein will be of no further
force and effect; provided, however, that such termination and relinquishment of
the Security Interest is expressly conditioned upon the Executive receiving (i)
the Shares and (ii) an assignment (the "Assigned Security Interest") from the
Company to the Executive of all of the Company's rights and interest in the
security agreement between the Company and the Buyer contemplated to be entered
into in connection with the consummation of the transactions contemplated by the
Public Safety Sales Agreement. The Assigned Security Interest shall terminate
upon receipt by the Executive of all payments due under the Royalty.
5. Resignation. The Executive acknowledges that he voluntarily resigned,
effective as of May 11, 1999, from all capacities and positions with the
Company, including but not limited to the offices of Chief Executive Officer,
President and Secretary and Director of the Company, the Chief Executive
Officer, Secretary, and Director of x.XX Commerce, Inc., and all officerships
and directorships of Rugby Acquisition Corp. and ETEL Communications Corp.
6. Representations of the Executive. The Executive represents, warrants,
and agrees with the Company as follows:
(a) To his knowledge, after due investigation, no consents of
governmental and other regulatory agencies, foreign or domestic, or of other
parties, are required to be received by or on the part of the Executive to
enable him to enter into and carry out this Agreement and the transactions
contemplated hereby.
(b) The Executive has the power to enter into this Agreement
and to carry out his obligations hereunder. This Agreement constitutes the valid
and binding obligation of the Executive, and is enforceable in accordance with
its terms.
(c) There is no unfulfilled agreement or commitment, written
or oral, made by the Executive for or on behalf of the Company pursuant to which
the Company is obligated to pay more than $5,000 singly, or $15,000 in the
aggregate, or which contractually restricts in any way the Company's ability to
enter into any agreement in the future (i) that since December 31, 1998 has not
been disclosed in writing to the Company and (ii) prior to December 31, 1998 has
not been disclosed in the Company's Annual Report on Form 10-KSB for the year
ended December 31, 1998 or the audited annual financial statements of the
Company in connection therewith.
(d) There is no liability or obligation incurred on behalf of
the Company by the Executive that has not been disclosed in writing to the
Company.
(e) Except as set forth in Schedule 6(e) attached hereto, no
acts or omissions finally determined by a court of competent jurisdiction prior
to or following the date hereof constituting fraud, gross negligence, or other
illegality which has a material adverse effect on the Company, have been
committed by the Executive for or on behalf of, or in his capacity as a director
or officer of, the Company.
(f) Neither the execution and delivery of this Agreement, nor
compliance by the Executive with any of the provisions hereof, nor the
consummation of the transactions contemplated hereby, will:
(i) violate any judgment, order, injunction, decree or award
against, or binding upon, the Executive;
(ii) violate or otherwise breach the terms of any agreement
or understanding, written or oral, to which the Executive is
a party or is otherwise bound; or
(iii) violate any law or regulation of any jurisdiction
relating to the Executive.
(g) No representation, warranty or statement by the Executive in this
Agreement intentionally (i) contains any untrue statement of a material fact, or
(ii) omits to state a fact necessary in order to make such representations,
warranties or statements not misleading.
(h) With respect to the issuance of the Shares:
(i) Executive represents and warrants that the Shares are
being acquired for his own account, for investment purposes
and not with a view to any distribution. Executive will not
sell, assign, mortgage, pledge, hypothecate, transfer or
otherwise dispose of any of the Shares unless (A) a
registration statement under the Securities Act, with
respect thereto is in effect and the prospectus included
therein meets the requirements of Section 10 of the
Securities Act, or (B) the Company has received a written
opinion of its counsel that, after an investigation of the
relevant facts, such counsel is of the opinion that such
proposed sale, assignment, mortgage, pledge, hypothecation,
transfer or disposition does not require registration under
the Securities Act.
(ii) Executive represents and warrants further that (A) he
is either an "accredited investor," as such term is defined
in Rule 501(a) promulgated under the Securities Act, or,
either alone or with its purchaser representative, has such
knowledge and experience in financial and business matters
that he is capable of evaluating the merits and risks of the
acquisition of the Shares; (B) he is able to bear the
economic risks of an investment in the Shares, including,
without limitation, the risk of the loss of part or all of
his investment and the inability to sell or transfer the
Shares for an indefinite period of time; (C) he has adequate
financial means of providing for current needs and
contingencies and has no need for liquidity in his
investment in the Shares; and (D) he does not have an
overall commitment to investments which are not readily
marketable that is excessive in proportion to net worth and
an investment in the Shares will not cause such overall
commitment to become excessive.
(iii) Executive has obtained and reviewed the Company
reports filed under the Securities Exchange Act of 1934, as
amended, (the "Exchange Act") including, without limitation,
the Company's Annual Report on Form 10-KSB for the year
ended December 31, 1998, the Quarterly Report on Form 10-QSB
for the quarter ended March 31, 1999, and the Current
Reports on Form 8-K, date of event reported May [12], 1999,
June 9, 1999 and June [30], 1999, and has been afforded the
opportunity to obtain such information with regard to the
Company he has requested to evaluate the merits and risks of
his investment in the Shares.
7. Representations of the Company. The Company represents, warrants, and
agrees with the Executive as follows:
(a) To the Company's knowledge, after due investigation, no
consents of governmental and other regulatory agencies, foreign or domestic, or
of other parties, are required to be received by or on the part of the Company
to enable it to enter into and carry out this Agreement and the transactions
contemplated hereby.
(b) The Company has the requisite corporate power to enter
into this Agreement and to carry out its obligations hereunder. The execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby have been duly authorized by the Board of Directors of the
Company, and no other corporate proceedings are necessary to authorize the
execution and delivery of this Agreement and the consummation of the
transactions contemplated
(c) Neither the execution and delivery of this Agreement nor
compliance by the Company with any of the provisions hereof, nor the
consummation of the transactions contemplated hereby, will:
(i) violate the Certificate of Incorporation or By-Laws of
the Company;
(ii) violate any judgment, order, injunction, decree or
award against, or binding upon, the Company;
(iii) violate or otherwise breach the terms of any agreement
or understanding, written or oral, to which the Company is a
party or is otherwise bound; or
(iv) violate any law or regulation of any jurisdiction
relating to the Company.
(d) No representation, warranty or statement by the Company in
this Agreement intentionally (i) contains any untrue statement of a material
fact, or (ii) omits to state a fact necessary in order to make such
representations, warranties or statements not misleading.
8. Restrictive Covenants. (a) The Executive covenants that for a period
ending May 10, 2001, he will not, either directly or indirectly, (i) disclose or
otherwise make known to any person or entity the names and addresses of any of
the customers of the Company, or (ii) call on, solicit, or take away, or attempt
to call on, solicit, or take away, any of the customers of the Company or its
subsidiaries with whom he became acquainted during his employment with the
Company, either for himself or for any other person, firm, corporation or other
entity.
(b) The Executive acknowledges that the Company and/or its
subsidiaries have developed unique skills, concepts, sales presentations,
marketing programs, marketing strategy, business practices, methods of
operation, trademarks, licenses, technical information, proprietary information,
computer software programs, tapes and disks concerning its or their operations,
systems, customer lists, customer leads, documents identifying past, present and
future customers, hiring and training methods, investment policies, financial
and other confidential and proprietary information concerning its operations and
expansion plans ("Trade Secrets"). The Executive agrees and covenants that,
except with the prior written consent of the Company, the Executive shall not,
directly or indirectly, use for the Executive's own benefit or for the benefit
of another, or disclose, disseminate, or distribute to another, any Trade Secret
(whether or not acquired, learned, obtained, or developed by the Executive alone
or in conjunction with others) of the Company or its subsidiaries. All
memoranda, notes, records, drawings, documents, or other writings whatsoever
(including copies thereof) made, compiled, acquired, or received by the
Executive during his employment by the Company, arising out of, in connection
with, or related to any activity or business of the Company or its subsidiaries,
including, but not limited to, the customers, suppliers, or others with whom the
Company or its subsidiaries has a business relationship, the arrangements of the
Company or its subsidiaries with such parties, and the pricing and expansion
policies and strategy of the Company or its subsidiaries, are, and shall
continue to be, the sole and exclusive property of the Company and its
subsidiaries, and shall be returned to the Company within five (5) days of the
execution of this Agreement.
(c) The Executive hereby covenants and agrees that for a
period ending May 10, 2001, he will not, either directly or indirectly, as an
employee, employer, consultant, agent, principal, partner, shareholder (other
than through ownership of publicly traded capital stock of a corporation which
represents less than five percent (5%) of the outstanding capital stock of such
corporation), corporate officer, director, investor, financier or in any other
individual or representative capacity, engage or participate in any business
which is directly competitive with the business of the Company or any of its
subsidiaries in the Internet service provider, e-commerce and telecommunications
business marketing products and services through a multi-level referral network
marketing organization.
9. Other Agreements. (a) General Agreements. The parties hereto acknowledge
and agree that, except as expressly provided in, or contemplated by, this
Agreement, and except for (i) any rights of indemnification to which the
Executive may be entitled by law or under the By-Laws or Certificate of
Incorporation of the Company, and any rights of indemnification to which the
Executive is entitled pursuant to the Indemnification Agreement by and between
the Executive and the Company (the "Indemnification Agreement") a copy of which
will be re-executed simultaneously with the execution of this Agreement, and
(ii) unreimbursed expenses of the Executive, which the Company hereby agrees to
pay, there are no outstanding unfulfilled contracts, commitments, or other
obligations of whatsoever nature as between the Executive and the Company or any
outstanding indebtedness owed by either party to the other; and the parties
hereto hereby further agree that any and all disputes, claims, open accounts and
other unresolved matters with respect to any of the foregoing which may exist on
the date hereof, shall be, and hereby are, in all respects resolved, satisfied
and settled as between the parties.
(b) Options. It is hereby acknowledged that all unexercised
options held by the Executive (the "Options") are immediately vested (if not
already vested) as of the Effective Date and shall continue in full force and
effect in accordance with their respective terms. Simultaneously with the
execution of this Agreement, the Company and Executive are entering into Amended
and Restated Stock Option Agreements with respect to the Options. The Company
shall, simultaneously with the execution of this Agreement, deliver irrevocable
instructions to the Company's transfer agent (and any successor transfer agent)
directing the transfer agent to issue shares of the Company's common stock to
Executive when Executive delivers to the transfer agent a notice of exercise as
provided in the Company's 1996 Stock Option Plan together with the payment of
the exercise price for such Options in accordance with the terms of the
agreements evidencing such Options.
.
(c) Registration. The Company shall prepare and, on or before
July 5, 1999 (the "Filing Date"), file with the Securities and Exchange
Commission (the "SEC") a registration statement on Form S-8 or other appropriate
form (the "Registration Statement") to effect a registration of (i) the resale
of the 62,500 shares of common stock of the Company issued to Executive in
connection with the Consulting Agreement (the "Consulting Shares"), and (ii) if
requested by Executive, to the extent not precluded by the Securities Act of
1933, as amended (the "Securities Act"), any rule or regulation promulgated
thereunder, the resale of any shares of common stock of the Company issued upon
the exercise of any of the Options which were previously registered on the
Company's previous Form S-8 registration statement, which registration provided
for hereunder shall follow deregistration of the resale of such Shares of common
stock of the Company under the Company's previously filed Form S-8 registration
statement including, without limitation, the filing of a reoffer prospectus as a
post-effective amendment as required from time to time to permit sales by the
Executive on a delayed or continuous basis. If the Registration Statement is not
filed with the SEC on or before the Filing Date, then the Executive shall have
the option to cause the Company to redeem 7,692 Consulting Shares at a price of
$3.25 per share (or an aggregate of $25,000) for each thirty day period after
the Filing Date that the Registration Statement has not been filed. The
Executive may elect to exercise the remedy provided for in this Section 9(c) at
any time with respect to the Company's failure to file the Registration
Statement. If, at any time prior to the Filing Date, in the good faith
reasonable judgment of Compu-DAWN's Board of Directors, the premature disclosure
of material non-public information which may reasonably be expected to have an
adverse effect on Compu-XXXX would be required in order for any Registration
Statement to be accurate and not misleading, then Compu-XXXX shall not be
required to file the Registration Statement for a period (a "Disclosure Delay
Period") expiring upon the earlier to occur of (A) the date on which such
material information is disclosed to the public or ceases to be material or (B)
thirty (30) calendar days after the date on which Compu-XXXX provides a notice
to the Executive of the Commencement of a Disclosure Delay Period.
(d) Benefits. For a period of 90 days from the Effective Date,
the Company shall provide the Executive with disability, hospitalization,
accident, major medical, term life insurance in the amount of $1,000,000, and
dental insurance which is the same as that which the Company is providing to the
Executive as of the day prior to the date hereof under Section 1.5(c) of the
Employment Agreement and with respect to disability insurance, if any, then the
same as such disability insurance provided by the Company to the Executive prior
to the date hereof. With regard
to the term life insurance policy referenced above, the Executive has incurred
expenses in the amount of $3,000 for the annual premium amount of such policy.
The Company hereby agrees to reimburse Executive such amount.
(e) Office Space. The Company shall, at its expense, provide
to the Executive until at least December 31, 1999, such office space at its
executive offices in Cedarhurst, New York (the "Cedarhurst Premises") as shall,
in the reasonable opinion of the Board of Directors, be suitable and adequate
for the Executive's use and shall be comparable in amenities to, his current
office space. In the event that the Company enters into an arm's length sublease
with respect to or reconfigures the Cedarhurst Premises prior to such date, the
Company shall provide to the Executive an amount of space and amenities
approximately equivalent to those provided to the Executive before such sublease
or reconfiguration. The foregoing notwithstanding, the Company shall have no
obligation to provide the Executive with such office space if, and from the time
that, the Company subleases the entire Cedarhurst Premises to an unaffiliated
third party.
(f) Employment of Xxxx Xxxxxxxxxxx. The Company hereby agrees
to employ Xxxx Xxxxxxxxxxx ("Xxxxxxxxxxx") through at least December 31, 1999,
and as full compensation for services rendered by Xxxxxxxxxxx shall pay to her
the salary, and provide the benefits, currently being received by her as of the
date hereof. In the event that the Company terminates Xxxxxxxxxxx'x employment
on or after December 31, 1999, and Xxxxxxxxxxx is not employed by the Executive
or by any affiliate of the Executive within one week of such termination,
Xxxxxxxxxxx shall be entitled to receive a severance payment in an amount equal
to three month's salary, payable by the Company within seven (7) days of such
termination. During the period of Xxxxxxxxxxx'x employment, the Company shall
allow the Executive the use of the services of Xxxx Xxxxxxxxxxx as required by
the Executive, provided however that the Company may utilize a reasonable amount
of Xxxxxxxxxxx'x working time and under the supervision of the Executive from
time to time during normal business hours to attend to certain administrative
matters of the Company of the same nature as those matters which Xxxxxxxxxxx
currently attends.
10. Releases.
(a) The Company hereby remises, releases, and forever
discharges and by these presents does for itself and its successors and assigns,
remise, release, and forever discharge the Executive and his heirs, successors
and assigns from all manner of action and actions, cause and causes of action,
suits, debts, dues, sums of money, accounts, reckonings, bonds, bills,
specialties, covenants, contracts, controversies, agreements, promises,
variances, trespasses, damages, judgments, executions, claims and demands
whatsoever, in law or in equity, which it ever had, now has or which may
hereafter accrue or which it, its successors or assigns, hereafter can, shall or
may have for, upon or by reason of any matter from the beginning of the world to
the day of the date of these presents; provided, however, it is confirmed
herewith that this release does not affect the rights or obligations of the
Company or the Executive under or pursuant to (i) the Security Agreement and
other related documents, (ii) the Indemnification Agreement, (iii) the Options,
or (iv) this Agreement (the "Excluded Agreements").
(b) The Executive hereby remises, releases, and forever
discharges and by these presents does for himself and his successors and
assigns, remise, release, and forever discharge the Company, its subsidiaries,
affiliates, directors, officers and stockholders (collectively, the "Company
Releasees") and successors and assigns of Company Releasees from all manner of
action and actions, cause and causes of action, suits, debts, dues, sums of
money, accounts, reckonings, bonds, bills, specialties, covenants, contracts,
controversies, agreements, promises, variances, trespasses, damages, judgments,
executions, claims and demands whatsoever, in law or in equity, which the
Executive ever had, now has or which may hereafter accrue or which the
Executive, his successors or assigns, hereafter can, shall or may have for, upon
or by reason of any matter from the beginning of the world to the day of the
date of these presents; provided, however it is confirmed herewith that this
release does not affect the rights or obligations of the Executive or the
Company Releasees under or pursuant to the Excluded Agreements.
(c) The Company and the Executive affirm that no
representation of fact or opinion has been made to induce the giving of the
releases provided by this Section 10 (the "Releases") other than as specifically
set forth herein and that it is therefore specifically agreed that the Releases
shall be a complete bar to any and all claims, suits or damages whatsoever,
other than with respect to the Excluded Agreements.
11. Nondisparagement. The Company agrees that, since May 11, 1999 and for
all time, neither the Company nor any officer, director, employee, consultant,
affiliate or agent of the Company (a "Representative") has made or shall make
any statement, written or oral, to any person or entity, or otherwise in general
to the public, or to the business or financial community or take any action,
directly or indirectly, that (a) disparages or is likely to diminish the
reputation of the Executive, or which could adversely affect the ability of the
Executive to enter into or consummate any business transaction, or the business
or reputation of the Executive, or (b) references any current or future
investigations by state or federal securities officials with regard to the
trading activities of the Executive; provided, however, that the foregoing shall
not preclude the Company from making any statement which is required (i) to
accurately comply with a court order, subpoena or other discovery necessary in
an action or proceeding in a court of competent jurisdiction, or (ii) by an
administrative agency or the Nasdaq Stock Market, Inc., or (iii) to accurately
comply with the Company's reporting requirements under the Securities Exchange
Act of 1934, as amended. The Company agrees to take reasonable steps to notify
its Representatives of the obligations and provisions of this Section 10.
Notwithstanding the generality of the foregoing, the Company agrees that, since
May 11, 1999 and for all time, neither the Company, nor any Representative has
made or shall make any statement, written or oral, to any person or entity, or
otherwise in general to the public regarding the Order to Cease and Desist (the
"Order"), Document No. CF-99-5359, issued by the State of Connecticut,
Department of Banking, concerning messages posted on Internet message boards or
any similar administrative or similar proceeding whether state or federal,
involving Executive except as required by clause (i), (ii) and (iii) above.
12. Choice of Law and Venue. The parties agree that this Agreement is made
and entered into in Nassau County, New York and shall be governed by and
construed in accordance with the laws of the State of New York, and that any
litigation, special proceeding or other
proceeding as between the parties that may be brought, or arise out of, in
connection with or by reason of this Agreement shall be brought in the
applicable state court in and for Nassau County, New York which Courts shall be
the exclusive courts or jurisdiction and venue, and all parties hereto consent
to the in personam jurisdiction of such Courts.
13. Entire Agreement. This Agreement contains the full and complete
understanding and agreement of the parties hereto with respect to the subject
matter contained herein and supersedes all prior or contemporaneous written or
oral understandings or agreements with respect to the subject matter hereof. No
modification of this Agreement shall be binding unless made in writing and
signed by the party sought to be charged.
14. Binding Effect. This Agreement shall be binding upon, and shall inure
to the benefit of, the parties hereto and their respective successors, assigns
and legal representatives. Xxxxxxxxxxx is an intended third-party beneficiary of
Section 9(f) hereof.
15. Public Disclosure. The Company agrees to publicly disclose the basic
terms of this Agreement and all documents contemplated hereunder by filing a
Form 8-K with the Securities and Exchange Commission containing such disclosure.
16. Equitable Relief; Breach; Specific Performance. The Executive
acknowledges and agrees that, in the event the Executive shall violate or
threaten to violate any of the restrictions of Section 8 hereof, the Company
will be without an adequate remedy at law and will therefore be entitled to
enforce such restrictions by temporary or permanent injunctive or mandatory
relief in any court of competent jurisdiction without the necessity of proving
damages and without prejudice to any other remedies which it may have at law or
in equity, it being understood that such remedy shall be in addition to any
other remedies which the Company may have at law or in equity. The Company
acknowledges and agrees that, in the event the Company or any Representative
shall violate or threaten to violate any of the restrictions of Section 11
hereof, the Executive will be without an adequate remedy at law and will
therefore be entitled to enforce such restrictions by temporary or permanent
injunctive or mandatory relief in any court of competent jurisdiction without
the necessity of proving damages and without prejudice to any other remedies
which it may have at law or in equity, it being understood that such remedy
shall be in addition to any other remedies which the Executive may have at law
or in equity. Furthermore, the Company and Executive acknowledge that a refusal
by either party to consummate the transactions contemplated hereby will cause
irreparable harm to the other party, for which there may be no adequate remedy
at law and for which the ascertainment of damages would be difficult. Therefore,
the parties shall be entitled, in addition to, and without having to prove the
inadequacy of, other remedies at law, to specific performance of this Agreement,
as well as ex parte injunctive relief (without being required to post bond or
other security).
17. Waiver, Severability. The waiver by either party of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach. If any provision of this Agreement, or part thereof, shall be
held to be invalid or unenforceable, such invalidity or unenforceability shall
attach only to such provision and not in any way affect or render invalid or
unenforceable any other provisions of this Agreement, and this Agreement shall
be carried out as if such invalid or unenforceable provision, or part thereof,
had been reformed, and any court of competent jurisdiction is authorized to so
reform such invalid or unenforceable provision, so that it would be valid, legal
and enforceable to the fullest extent permitted by applicable law.
18. Notices; Deliveries. Any notice, delivery or other communication
required or permitted hereunder shall be sufficiently given if delivered by hand
or sent by certified mail, return receipt requested, facsimile transmission,
overnight mail or nationally recognized overnight courier, addressed as follows:
If to the Company:
00000 Xxxx Xxx Xxxxxxx Xxxx, Xxxx. 000
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: Chairman of the Board
Telecopier Number:(000) 000-0000
with a copies to:
Certilman Balin Xxxxx & Xxxxx, LLP
00 Xxxxxxx Xxxxxx
Xxxx Xxxxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxx, Esq.
Telecopier Number: (000)000-0000
Xxxxx Xxxxxx & Xxxxx
000 Xxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxx X. Xxxxx, Xx., Esq.
Telecopier Number: (000)000-0000
If to the Executive:
000 Xxxx Xxx
Xxxxxxxx, Xxx Xxxx 00000
Telecopier Number: (000) 000-0000
with a copy to:
Xxxxxxx Xxxxxx L.L.P.
000 Xxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Xx., Esq.
Telecopier Number: (000) 000-0000
or such other address as shall be furnished in writing by either party, and any
notice, delivery or communication given pursuant to the provisions hereof shall
be deemed to have been given as of the date delivered or so mailed or
transmitted.
19. Counterparts; Headings. This Agreement may be executed in counterparts,
each of which shall be an original, but all of which taken together shall
constitute one agreement. The headings contained in this Agreement are solely
for the convenience of the parties, and are not intended to and do not limit,
construe or modify any of the terms and conditions hereof.
20. Waiver of Jury Trial. THE COMPANY AND THE EXECUTIVE ACKNOWLEDGE THAT
THE RIGHT TO A TRIAL BY JURY IS A CONSTITUTIONAL RIGHT, BUT THAT THE RIGHT MAY
BE WAIVED. THE COMPANY AND THE EXECUTIVE EACH KNOWINGLY, VOLUNTARILY,
IRREVOCABLY AND WITHOUT COERCION, WAIVES ALL RIGHTS TO TRIAL BY JURY OF ALL
DISPUTES BETWEEN THEM. NEITHER THE COMPANY NOR THE EXECUTIVE SHALL BE DEEMED TO
HAVE GIVEN UP THIS WAIVER OF JURY TRIAL UNLESS THE PARTY CLAIMING THAT THIS
WAIVER HAS BEEN RELINQUISHED HAS A WRITTEN INSTRUMENT SIGNED BY THE OTHER PARTY
STATING THAT THIS WAIVER HAS BEEN GIVEN UP. IN THE EVENT OF LITIGATION, A COPY
OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO TRIAL BY THE COURT.
21. Further Assurances. The parties hereto agree to execute and deliver
such other instruments as shall be appropriate, as the other party or its
counsel shall reasonably request, to carry out the purpose and intent of this
Agreement and to vest in Executive good and marketable title to the Shares.
IN WITNESS WHEREOF, the parties have execute this Agreement as of the
day and year first above written.
COMPU-XXXX, INC.
By:/s/ Xxxxxx X.(Teddy) Xxxxxx, IV
----------------------------------
Xxxxxx X. (Teddy) Xxxxxx, IV
Chairman of the Board
/s/ Xxxx Xxxxxxxxxx
-------------------
XXXX XXXXXXXXXX
The undersigned hereby agree to be bound individually to the provisions
of Section 11 of this Agreement.
/s/ Xxxxxx X. (Teddy) Xxxxxx, IV
-------------------------------------
Xxxxxx X. (Teddy) Xxxxxx, IV
/s/ Xxxx Theale
-------------------------------------
Xxxx Theale
