Exhibit 10.2
INTELLIWORXX FOUNDER'S AGREEMENT
THIS AGREEMENT is made this 1st day of February, 2000, among Intelliworxx,
Inc. a Florida corporation (the "Corporation"), and the undersigned shareholders
of the Corporation, all of whom are original owners of shares of voting stock in
the Corporation (the "Founder" or collectively "Founders").
WITNESSETH
WHEREAS, the Founders have been and will continue to be actively engaged in
the conduct of the Corporation's business and the success of the business
depends in large part on the abilities and skills of each of them; and,
WHEREAS, to facilitate the achievement of the Corporation's objectives and
to confirm the mutual recognition of the Founders of the fiduciary
responsibilities owed by each of them to the others and to the Corporation, the
parties desire to execute this Agreement in order to memorialize certain
understandings among the Founders and the Corporation.
NOW, THEREFORE
For good and valuable consideration the parties, intending to be legally bound,
agree as follows:
1. Term. Unless sooner terminated as provided herein, the term of this
Agreement ("Term") shall be two years, commencing on February 1, 2000
and ending on January 31, 2002.
2. Ownership. Each of the Founders was originally the beneficial owner of
the number of shares of voting stock in the Corporation as shown next
to his name on Attachment A hereto. These shares have been issued in
the name of each of the Founders and such shares will be owned by each
of the Founders for the Term except as otherwise permitted by the
provisions of this Agreement.
3. Restrictions on Transfer of Shares. During the term of this Agreement
no Founder (or subsequent permitted assignee or transferee) shall
sell, transfer, pledge, assign, encumber or otherwise dispose of all
or any part of his shares in a "Brokered Transaction". "Brokered
Transaction" for purposes hereof shall mean any transfer of shares
through a licensed brokerage house. The foregoing notwithstanding, the
Founders, within an agreement between the Company and an underwriter,
may sell shares in a Brokered Transaction in conjunction with a
registered offering of the shares of the Company. During the term of
this Agreement no Founder (or subsequent permitted assignee or
transferee) shall sell, transfer, pledge, assign, encumber or
otherwise dispose of all or any part of his shares in a "Private
Transaction" without the approval of a majority of the Board of
Directors, such approval not to be unreasonably withheld. "Private
Transaction" for the purposes hereof shall mean any transfer of shares
outside of a "Brokered Transaction".
4. Repurchase Option of Company on Unvested Shares. With the execution of
this Agreement, if (i) the Company terminates a Founder's employment
with Cause as defined below or (ii) a Founder voluntarily terminates
Exhibit 10.2
such employment or (iii) such employment is terminated as a result of
a Founder's death or disability (as defined below), then said Founder
shall be designated a "Selling Founder" and the Company (or any
assignee selected by the Company) shall have the right to repurchase,
and the Selling Founder or his legal representatives shall, at the
election of the Company, be obligated to sell, all or any part of the
shares of the Selling Founder (the "Unvested Shares") in the amounts
and at the price per share as shown in the following table (the
"Repurchase Option Schedule").
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Date of Selling Selling Founder Repurchase Price per Share as a
Period Founder Designation Unvested Shares Percentage of Market Price
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1 Feb 1, 2000 to 1,400,000 1%
July 31, 2000
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2 Aug 1, 2000 to 1,000,000 5%
Jan 31, 2001
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3 Feb 1, 2001 to 600,000 10%
July 31, 2001
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4 Aug 1, 2001 to 200,000 15%
Jan 31, 2002
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Market Price is defined as the average closing price of the Common
Stock of the Company for the preceding ten (10) days of trading. The
Repurchase Payment is the number of shares the Company opts to
repurchase from the Selling Founder multiplied by the Repurchase Price
per Share for the period as given in the table above.
5. Exercise of Repurchase Option. On the occurrence of any event
described in Section 4 hereof, the Company may exercise its Repurchase
Option by giving written notice to the Selling Founder (or the Selling
Founder's legal representative, as the case may be) at any time after
30 days and before 61 days following the effective date of termination
of the Selling Founder's employment with the Company, specifying the
number of Unvested Shares to be repurchased by the Company. Within 15
days after receipt of such notice, the Selling Founder (or the Selling
Founder's legal representatives) shall send to the escrow agent
designated in Attachment B to this agreement, via certified mail or
Federal Express, the certificate(s), together with duly executed stock
powers, representing the number of shares being repurchased by the
Company. Within 10 days following receipt of such certificate(s) by
the escrow agent, the Company shall deliver to the escrow agent the
Repurchase Payment for the aggregate purchase price for the shares
that the Company has elected to purchase under the Repurchase Option.
The Repurchase Payment shall consist of (i) a check drawn on the
operating account of the Company in the amount of $100,000, $250,000,
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Exhibit 10.2
$300,000 or $500,000 for Period 1,2,3 or 4 respectively and (ii) a
promissory note for the balance of the Repurchase Payment, said note
to have a 10% per annum interest rate (interest to accrue) and a two
year maturity. Upon receipt of the Repurchase Payment, the escrow
agent shall deliver the Repurchase Payment to the Selling Founder and
shall further deliver the certificate(s) to the Company. Upon the date
of such notice from the Company to the Selling Founder (or the Selling
Founder's legal representatives), the interest of the Selling Founder
(and of the Selling Founder's legal representatives) in the shares
specified in such notice shall automatically terminate, except for the
right to receive payment from the Company for such shares.
6. Failure to Deliver Shares. If a Founder becomes obligated to sell
Shares to the Company under this Agreement and fails to deliver such
Shares to the Company in accordance with the terms of this Agreement,
the Company, may, at its option, in addition to all other remedies it
may have, send to the Selling Founder by registered or certified mail,
return receipt requested, the purchase price for such Shares,
determined as is herein specified. Thereupon, the Company, upon
written notice to the Selling Founder, shall (i) cancel on its books
the certificate or certificates representing the shares to be sold;
and (ii) issue, in lieu thereof, a new certificate or certificates in
the name of the Selling Founder, if representing such Shares which may
remain, and, if acting for itself, the Company shall cancel the
certificates and retain the Shares as treasury shares; and thereupon
all of the Selling Founder's rights in and to such Shares shall
terminate.
7. Definition of "Disability". For purposes of this Agreement, the term
"disability" shall mean the physical or mental illness or disability
of the Founder, such that, in the good faith judgment of two reputable
physicians, he shall become unable to perform his duties of employment
and such inability may reasonably be expected to be permanent or to
continue for a period of at least six consecutive months (or for
shorter periods totaling more than two-hundred ten (210) days during
any period of twelve consecutive months).
8. Change in Control. Upon the occurrence of a Change in Control or a
Business Combination (each as defined below), all of the then Unvested
Shares held by a Founder shall become Vested Shares if the Founder is
employed by the Company at the time of such event.
9. Definition of "Change in Control" and "Business Combination". A Change
in Control shall be deemed to have occurred when: (i) securities of
the Company representing 50% or more of the combined voting power of
the Company's then outstanding voting securities are acquired by a
person or entity, or group of related persons or entities, in one or a
series of related transactions occurring within one year, provided,
however, that persons or entities shall not be deemed to be related
merely because they acquire their shares under the same or similar
agreement or agreements with the Company; (ii) a merger or
consolidation is consummated in which the Company is a constituent
corporation and which results in less than 50% of the outstanding
voting securities of the surviving or resulting entity being owned by
the then existing stockholders of the Company; or (iii) a sale is
consummated by the Company of substantially all of the Company's
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Exhibit 10.2
assets to a person or entity which is not a wholly owned subsidiary of
the Company. The events described in clauses (ii) and (iii) above are
also referred to herein as a "Business Combination."
10. Definition of "Cause". For purposes hereof, "Cause" shall mean any
willful misconduct where such misconduct materially adversely affects
the reputation or business activities of the Company, or any
non-performance of the Founder's job responsibilities as required by
the Board of Directors. "Cause" shall be determined by the Board of
Directors, and a finding of "Cause" shall require the concurrence of a
majority of directors, and any such determination shall be final and
conclusive upon the Company and the Founder except for Xxxxxx. A
determination of Cause by the Board of Directors for Xxxxxx shall
require the concurrence the all directors minus one.
11. Exemption from Repurchase Option. Founder's Xxxxx and Xxxxx are hereby
exempt from the provisions set forth in sections four through ten
herein. All other sections apply.
12. Legend on Shares. During the Term all of the shares owned by the
Founders shall be subject to this Agreement. Each stock certificate
shall contain the following legend on its face:
"The shares in this certificate are restricted from
transfer in accordance with and subject to a Founder's
Agreement dated February 1, 2000 among the Founders and
the Corporation. All transfers or other encumbrances on
all or any of these shares made or attempted to be made
in violation of such Founder's Agreement shall be
void."
13. Successors and Assigns. This Agreement shall be binding on and inure
to the benefit of any executor, administrator, or personal
representative as well as the heirs and assigns of each of the
Founders.
14. Governing Law. This Agreement is executed and is to be performed in
Florida and shall be governed by and construed in accordance with the
laws of the State of Florida.
15. Termination of Agreement. This Agreement shall terminate, and the
certificate representing the shares shall be released from the terms
hereof, on the happening of any of the following events:
A. Cessation or sale of the Corporation's business;
B. Dissolution of the Corporation, by operation of law or otherwise;
C. Expiration of the Term, or any extension thereof.
Upon the termination of this Agreement for any of these reasons, the
certificates for shares shall be surrendered to the Corporation and
the Corporation shall issue new certificates for the same number of
shares, but without the restrictive legend required hereunder.
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Exhibit 10.2
16. Entire Agreement. This Agreement is the entire agreement among the
parties with respect to the subject matter hereof and shall not be
amended so as to expand the rights of the Founders to transfer the
shares beyond the terms of this Agreement. No amendment shall be
effective unless in writing and executed by all of the parties with
the same degree of formality as required herein.
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Exhibit 10.2
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
first above written.
WITNESS INTELLIWORXX, INC.
By: /s/ Xxxxx X. Xxxxxx
----------------------------- -------------------------------
Xxxxx X. Xxxxxx, President
& CEO
FOUNDER
By: /s/ Xxxxxxx X. Xxxxx
----------------------------- -------------------------------
Xxxxxxx X. Xxxxx
FOUNDER
By: /s/ Xxxxxxxxxxx X. Xxxxx
----------------------------- -------------------------------
Xxxxxxxxxxx X. Xxxxx
FOUNDER
By: /s/ Xxxxxxx X. Xxxxx
----------------------------- -------------------------------
Xxxxxxx X. Xxxxx
FOUNDER
By: /s/ Xxxxxx X. Xxxxx, Xx.
----------------------------- ------------------------
Xxxxxx X. Xxxxx, Xx.
FOUNDER
By: /s/ Xxxxxxx X. Xxxxxxxx
----------------------------- -------------------------------
Xxxxxxx X. Xxxxxxxx
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Exhibit 10.2
FOUNDER
By: /s/ Xxxxx X. Xxxxx
----------------------------- -------------------------------
Xxxxx X. Xxxxx
FOUNDER
By: /s/ Xxxxx X. Xxxxxx
----------------------------- -------------------------------
Xxxxx X. Xxxxxx
FOUNDER
By: /s/ Ian N, Xxxxxxxxx
----------------------------- -------------------------------
Xxx X. Xxxxxxxxx
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Exhibit 10.2
Attachment A
Beneficial Ownership Table
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Name Number of Shares
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Xxxxxxx X. Xxxxx 375,000
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Xxxxxxxxxxx X. Xxxxx 1,875,000
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Xxxxxxx X. Xxxxx 1,875,000
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Xxxxxx X. Xxxxx, Xx. 1,875,000
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Xxxxxxx X. Xxxxxxxx 1,875,000
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Xxxxx X. Xxxxx 375,000
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Xxxxx X. Xxxxxx 1,875,000
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Xxx X. Xxxxxxxxx 1,875,000
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Exhibit 10.2
Attachment B
Escrow Agent Designation
The escrow agent in the event that, per this Agreement, the Company repurchases
shares from a Selling Founder, shall be as designated below.
Xxxxxxx X. Xxxxxx, Esq.
Xxxxxx & Xxxxxxxxx, LLP
000 Xxx Xxxxxxx Xxxx
Xxxxxx Xxxx, XX 00000
Phone: (516) 228 - 8181
Fax: (516) 228 - 8211
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