EMPLOYMENT AGREEMENT
EXHIBIT
10.2
THIS
EMPLOYMENT AGREEMENT ("Agreement") is made by and between friendlyway
Corporation, a duly organized Nevada corporation (“Employer”), and Xxxxxxx X.
Xxxxxxx, a resident of the State of Colorado (“Employee”).
W
I T N E S S E T H:
WHEREAS,
Employer is in need of persons with experience at the executive level in
developing, organizing and managing all aspects of the Employer’s business;
and
WHEREAS,
Employee has the necessary experience desired by Employer; and
WHEREAS,
Employee is willing to be employed by Employer, and Employer is willing to
employ Employee, on the terms, covenants and conditions hereinafter set forth;
and
WHEREAS,
Employer and its affiliates have accumulated valuable and confidential
information, including, without limitation, trade secrets and know-how relating
to technology, equipment, marketing plans, acquisition plans, sources of supply,
business strategies and other business records; and
WHEREAS,
the giving of the covenants contained herein is a condition precedent to the
employment of Employee by Employer and Employee acknowledges that the execution
of this Agreement and the entering into of these covenants is an express
condition of his employment by Employer and that said covenants are given in
consideration for such employment and the other benefits conferred upon him
by
this Agreement; and
NOW,
THEREFORE, in consideration of such employment and other valuable consideration,
the receipt and adequacy of which is hereby acknowledged, Employer and Employee
hereby agree as follows:
SECTION
I. EMPLOYMENT OF EMPLOYEE
Employer
hereby employs, engages and hires Employee as President and Chief Executive
Officer of Employer, and Employee hereby accepts and agrees to such hiring,
engagement and employment, subject to the direct supervision and direction
of
the Board of Directors of Employer. Employee shall perform duties as are
customarily performed by one holding such position in other, same or similar
businesses or enterprises as that engaged in by Employer, and shall also
additionally render such other and unrelated services and duties as may be
assigned to him from time to time by Employer.
SECTION
II. EMPLOYEE’S PERFORMANCE
Employee
hereby agrees that he will, at all times, faithfully, industriously and to
the
best of his ability, experience and talents, perform all of the duties that
may
be required of and from him pursuant to the express and implicit terms hereof,
to the reasonable satisfaction of Employer.
SECTION
III. COMPENSATION OF EMPLOYEE
Employer
shall pay Employee, and Employee shall accept from Employer, in full payment
for
Employee's services hereunder, compensation as follows:
A. Salary.
Employee shall be paid a salary of $200,000.00 per year, which salary shall
be
payable in equal installments on the 1st and 15th days of each calendar month,
in arrears, subject to deduction of all lawful and required withholding.
Employer may, in its sole discretion, for any payment period hereunder, elect
to
pay up to 100% of Employee’s salary in shares of Employer’s Common Stock as
determined by the Board of Directors.
B. Insurance
and Other Benefits.
As
further consideration for the covenants contained herein, Employer will provide
Employee with such insurance, welfare, sick leave and other benefits as may
be
established by Employer from time to time with respect to its employees in
accordance with Employer’s established procedures. Employee shall be entitled to
Directors’ and Officers’ indemnification insurance coverage to the same extent
as is provided to other persons employed as officers of Employer.
C. Other
Compensation Plans.
Employee shall be entitled to participate, to the same extent as is provided
to
other persons employed by Employer, in any future stock bonus plan, stock option
plan or employee stock ownership plan of Employer.
D. Expenses.
It is
acknowledged that, during the term of employment, Employee will be required
to
incur ordinary and necessary business expenses on behalf of Employer in
connection with the performance of his duties hereunder. Employer shall
reimburse Employee promptly the amount of all such expenses upon presentation
of
itemized vouchers or other evidence of those expenditures. Any single expense
item in excess of $4,000.00 shall be approved by Employer prior to the
incurrence of such expense.
E. Vacations.
Employee shall be entitled to three (3) weeks paid vacation each year for the
term of this Agreement. Such vacations shall be taken at such times as Employer
designates as to time-of-year. Vacation time can be accumulated year-to-year
up
to three years maximum.
F.Additional
Compensation.
(1)
As
further consideration for the services to be provided by Employee, Employer
will
issue to Employee shares of Employer’s common stock, provided that Pantel
Systems, Inc. (“Pantel”) achieves
a certain amount of gross profit (“Pantel Gross Profit”) as
follows:
(a) On
the
first anniversary of the Closing Date (as such term is defined in that separate
Share Exchange Agreement, dated May 1, 2006, by and between Friendlyway
Corporation and Pantel), if the Pantel Gross Profit is
(i) at
least
equal to $5,716,691, Employee shall be entitled to receive 19,259,561 shares
of
Employer common stock; or
(ii) at
least
equal to $4,573,353, but less than $5,716,691, Employee shall be entitled to
receive 14,444,671 shares of Employer common stock; or
(iii) at
least
equal to $3,430,015, but less than $4,573,353, Employee shall be entitled to
receive 9,629,781 shares of Employer common stock.
(b) On
the
second anniversary of the Closing Date, if the Pantel Gross Profit
is
(i) at
least
equal to $21,642,258, Employee shall be entitled to receive 19,259,561 shares
of
Employer common stock; or
(ii) at
least
equal to $17,313,806, but less than $21,642,258, Employee shall be entitled
to
receive 14,444,671 shares of Employer common stock; or
(iii) at
least
equal to $12,985,355, but less than $17,313,806, Employee shall be entitled
to
receive 9,629,781 shares of Employer common stock.
(c) On
the
third anniversary of the Closing Date, if the Pantel Gross Profit
is
(i) at
least
equal to $36,870,967, Employee shall be entitled to receive 19,259,561 shares
of
Employer common stock; or
(ii) at
least
equal to $29,496,773, but less than $36,870,967, Employee shall be entitled
to
receive 14,444,671 shares of Employer common stock; or
(iii) at
least
equal to $22,122,580, but less than $29,496,773, Employee shall be entitled
to
receive 9,629,781 shares of Employer common stock.
2
For
purposes of this Section “Pantel Gross
Profit” shall be equal to the amount of (x) Pantel’s revenues minus (y) Pantel’s
cost of revenues for the applicable period, which shall be calculated for each
anniversary period in accordance with GAAP.
(2)
It is
acknowledged that the Employer plans to expand through internal growth and
acquisitions. To the extent that Employee is instrumental in evaluating,
negotiating and closing acquisition transactions, Employee shall be entitled
to
an option representing the share equivalent of three and one-half percent (3.5%)
of the purchase price of the acquisition at acquisition price or market price
as
determined by Employer (i.e. purchase price of $200, one-half in cash and
one-half in common stock of Employer, assuming $1.00 market value per share,
=
option to purchase seven (7) shares at an option price of $1.00 per
share).
SECTION
IV. COMPANY POLICIES
Employee
agrees to abide by the policies, rules, regulations or usages applicable to
Employee as established by Employer from time to time and provided to Employee
in writing.
SECTION
V. CONFIDENTIALITY AGREEMENT; NON-COMPETITION AGREEMENT
A. In
consideration of Employer’s executing this Agreement, Employee shall have
executed, prior to the execution of this Agreement, a Confidentiality Agreement
(the “Confidentiality Agreement”), in the form attached hereto as Exhibit
“A”.
B. In
consideration of Employer’s executing this Agreement, Employee agrees, effective
as of the date hereof, to sign and be bound by the obligations of an Agreement
Not to Compete (the “Non-Competition Agreement”), in the form attached hereto as
Exhibit “B”.
C. The
obligations under the Confidentiality Agreement and the Non-Competition
Agreement shall survive the termination of this Agreement.
SECTION
VI. TERM AND TERMINATION
A. Term.
The
term of this Agreement shall be a period of twenty-four (24) months, commencing
on the date hereof. At the expiration of each month hereafter, this Agreement
shall be automatically renewed for additional twenty-four (24) months, provided
neither party hereto submits a written notice of termination within sixty (60)
days prior to the termination of either the initial term hereof or any renewal
term.
B. Termination.
Employer agrees not to terminate this Agreement except for "just cause", and
agrees to give Employee written notice of its belief that acts or events
constituting "just cause" exist. Employee has the right to cure, within thirty
(30) days of Employer's giving of such notice, the acts, events or conditions
which led to Employer's notice. For purposes of this Agreement, "just cause"
shall mean (1) the willful failure or refusal of Employee to implement or follow
the written policies or directions of Employer's Board of Directors, provided
that Employee's failure or refusal is not based upon Employee's belief in good
faith, as expressed to Employer in writing, that the implementation thereof
would be unlawful; (2) gross negligence; (3) misappropriation of assets of
Employer; (4) any act involving personal dishonesty or criminal conduct against
Employer.
Although
Employer retains the right to terminate Employee for any reason not specified
above, Employer agrees that if it discharges Employee for any reason other
than
just cause, as is solely defined above, Employee will be entitled to full
compensation, including participation in all benefit programs, for the remainder
of the current term, original or renewal, as the case may be, of
employment.
If
Employee should cease his employment hereunder voluntarily for any reason,
or is
terminated for just cause, all compensation and benefits payable to Employee
shall thereupon, without any further writing or act, cease, lapse and be
terminated. However, all defined compensation, benefits and reimbursements
which
accrued prior to Employee's ceasing employment or termination, will become
immediately due and payable and shall be payable to Employee’s estate should his
employment cease due to death.
C. Change
in Control.
In the
event of a change in control, Employee may, in his sole discretion, terminate
his employment hereunder voluntarily and, notwithstanding such termination,
Employee will be entitled to full compensation under this Agreement, including
participation in all benefit programs, for the remainder of the current term,
original or renewal, as the case may be, of employment.
3
For
purposes of this Section, a "change in control" shall be deemed to
occur:
(1)
if
any "person" (as such term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act")), other than a trustee
or
other fiduciary holding securities of the Employer under an employee benefit
plan of the Employer, becomes the "beneficial owner" (as defined in Rule 13d-3
promulgated under the Exchange Act), directly or indirectly, of securities
of
the Employer representing 50% or more of (a) the outstanding shares of common
stock of the Employer or (b) the combined voting power of the Employer's
then-outstanding securities;
(2)
if
the Employer is party to a merger or consolidation, or series of related
transactions, which results in the voting securities of the Employer outstanding
immediately prior thereto failing to continue to represent (either by remaining
outstanding or by being converted into voting securities of the surviving or
another entity) at least fifty (50%) percent of the combined voting power of
the
voting securities of the Employer or such surviving or other entity outstanding
immediately after such merger or consolidation;
(3)
if
there occurs a sale or disposition of all or substantially all of the Employer's
assets (or consummation of any transaction, or series of related transactions,
having similar effect);
(4)
if
there occurs a change in the composition of the Board of Directors of the
Employer within a two-year period, as a result of which fewer than a majority
of
the directors are Incumbent Directors;
(5)
upon
the dissolution or liquidation of the Employer; or
(6)
upon
the occurrence any transaction or series of related transactions that has the
substantial effect of any one or more of the foregoing.
Notwithstanding
any other provision of this Agreement, the aggregate present value of all
payments made to Employee pursuant to this Section VI(C) shall not exceed two
times the Employee's base amount. For purposes of this provision, the “base
amount” shall be the Employee’s average compensation includible in gross income
for the five taxable years preceding the taxable year in which the change in
control occurs.
SECTION
VII. COMPLETE AGREEMENT
This
Agreement contains the complete agreement concerning the employment arrangement
between the parties hereto and shall, as of the effective date hereof, supersede
all other agreements between the parties. The parties hereto stipulate that
neither of them has made any representation with respect to the subject matter
of this Agreement or any representations including the execution and delivery
hereof, except such representations as are specifically set forth herein and
each of the parties hereto acknowledges that he or it has relied on his or
its
own judgment in entering into this Agreement. The parties hereto further
acknowledge that any payments or representations that may have heretofore been
made by either of them to the other are of no effect and that neither of them
has relied thereon in connection with his or its dealings with the
other.
SECTION
VIII. WAIVER; MODIFICATION
The
waiver by either party of a breach or violation of any provision of this
Agreement shall not operate as, or be construed to be, a waiver of any
subsequent breach hereof. No waiver or modification of this Agreement or of
any
covenant, condition or limitation herein contained shall be valid unless in
writing and duly executed by the party to be charged therewith and no evidence
of any waiver or modification shall be offered or received in evidence of any
proceeding or litigation between the parties hereto arising out of, or
affecting, this Agreement, or the rights or obligations of the parties
hereunder, unless such waiver or modification is in writing, duly executed
as
aforesaid, and the parties further agree that the provisions of this Section
may
not be waived except as herein set forth.
SECTION
IX. SEVERABILITY
All
agreements and covenants contained herein are severable, and in the event any
one of them, with the exception of those contained in Sections I, III, IV and
V
hereof, shall be held to be invalid in any proceeding or litigation between
the
parties, this Agreement shall be interpreted as if such invalid agreements
or
covenants were not contained herein.
4
SECTION
X. NOTICES
Any
and
all notices will be sufficient if furnished in writing and sent by registered
mail to Employee’s last known residence or Employer’s principal office
address.
SECTION
XI. CORPORATE AUTHORITY OF EMPLOYER
The
execution of this Agreement by Employer has been approved by the Board of
Directors of Employer.
SECTION
XII. REPRESENTATIONS OF EMPLOYEE
A. Legal
Disability.
Employee hereby represents to Employer that he is under no legal disability
with
respect to his entering into this Agreement.
B. Receipt
of Disclosure.
Employee hereby represents and warrants that he has received and reviewed (1)
Employer’s Annual Reports on Form 10-KSB, as filed with the SEC, (2) Employer’s
Quarterly Reports on Form 10-QSB, as filed with the SEC and, (3) Employer’s
Current Reports on Form 8-K, as amended and as filed with the SEC. With respect
to such information, Employee further represents and warrants that he has had
an
opportunity to ask questions of, and to receive answers from, the officers
of
Employer.
C. Representations
Relating to Employer Common Stock.
Employee represents and warrants to Employer that the shares of Employer common
stock being acquired pursuant to this Employment Agreement are being acquired
for his own account and for investment and not with a view to the public resale
or distribution of such shares and further acknowledges that the shares being
issued have not been registered under the Securities Act or any state securities
law and are “restricted securities,” as that term is defined in Rule 144
promulgated by the SEC, and must be held for a minimum of 12 months, unless
they
are subsequently registered or an exemption from such registration is
available.
D. Consent
to Legend.
Employee consents to the placement of a legend restricting future transfer
on
the share certificates representing the Employer common stock delivered
hereunder, which legend shall be in the following, or similar,
form:
“THE
STOCK REPRESENTED BY THIS CERTIFICATE HAS BEEN ISSUED IN RELIANCE UPON THE
EXEMPTION FROM REGISTRATION AFFORDED BY SECTION 4(2) OF THE SECURITIES ACT
OF
1933, AS AMENDED. THE STOCK MAY NOT BE TRANSFERRED WITHOUT REGISTRATION EXCEPT
IN TRANSACTIONS EXEMPT FROM SUCH REGISTRATION.”
SECTION
XIII. COUNTERPARTS
This
Agreement may be executed in multiple counterparts, each of which shall be
deemed an original and, together, shall constitute one and the same agreement,
with one counterpart being delivered to each party hereto.
SECTION
XIV. BENEFIT
The
provisions of this Agreement shall extend to the successors, surviving
corporations and assigns of Employer and to any purchaser of substantially
all
of the assets and business of Employer. The term "Employer" shall be deemed
to
include Employer, any joint venture, partnership, limited liability company,
corporation or other juridical entity, in which Employer shall have an interest,
financial or otherwise.
SECTION
XV. ARBITRATION
The
parties agree that any dispute arising between them related to this Agreement
or
the performance hereof shall be submitted for resolution to the American
Arbitration Association for arbitration in the Denver, Colorado, office of
the
Association under the then-current rules of arbitration. The Arbitrator or
Arbitrators shall have the authority to award to the prevailing party its
reasonable costs and attorneys fees. Any award of the Arbitrators may be entered
as a judgment in any court competent jurisdiction.
Notwithstanding
the provisions contained in the foregoing paragraph, the parties hereto agree
that Employer may, at its election and without delivering the notice to Employee
required in Section VI(B) hereof, seek injunctive or other equitable relief
from
a court of competent jurisdiction for a violation or violations by Employee
of
the Confidentiality Agreement or the Non-Competition Agreement.
5
SECTION
XVI. LEGAL REPRESENTATION
Employer
and Employee both acknowledge that Employer has utilized legal counsel with
respect to this Agreement. EMPLOYEE
IS ADMONISHED TO SEEK HIS OWN LEGAL COUNSEL.
SECTION
XVII. GOVERNING LAW
It
is the
intention of the parties hereto that this Agreement and the performance
hereunder and all suits and special proceedings hereunder be construed in
accordance with and under and pursuant to the laws of the State of Colorado,
and
that, in any action, special proceeding or other proceeding that may be brought
arising out of, in connection with or by reason of this Agreement, the laws
of
the State of Colorado shall be applicable and shall govern to the exclusion
of
the law of any other forum, without regard to the jurisdiction in which any
such
action or special proceeding may be instituted.
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of April
27,
2006.
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friendlyway
CORPORATION
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By:/s/
Xxxxxxxxx xxx Xxxxxxxx
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Xxxxxxxxx xxx Xxxxxxxx
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Chief Executive Officer
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EMPLOYEE:
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/s/
Xxxxxxx X.
Xxxxxxx
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Xxxxxxx
X. Xxxxxxx
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6
Exhibit
“A”
CONFIDENTIALITY
AGREEMENT
April
27,
2006
friendlyway
Corporation
0000
Xxxxxxx
Xxxxx
000
Xxx
Xxxxxxxxx, XX 00000
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Re:
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Confidentiality
Agreement
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Gentlemen:
In
connection with the execution of an employment agreement (the “Employment
Agreement”) between the undersigned and friendlyway Corporation (together with
affiliates, the “Company”), the Company will furnish to the undersigned certain
information concerning its business, financial position, operations, business
contacts, assets and liabilities, as well as certain items of equipment useful
in its business. As a condition to furnishing such information to the
undersigned and as a condition to the undersigned’s entering into an employment
agreement with the Company, the undersigned agrees to treat any information
concerning the Company (whether prepared by the Company, its advisors, or
otherwise, and irrespective of the form of communication) which is furnished
to
the undersigned now or in the future by or on behalf of the Company (together
with the material described below, herein collectively referred to as the
“Confidential Material”) in accordance with the provisions of this letter
agreement, and to take or abstain from taking certain other actions hereinafter
set forth.
The
undersigned understands that the term “Confidential Material” also includes all
notes, analysis, compilations, studies, interpretations or other documents
prepared by the Company or its representatives which contain, reflect or are
based upon, in whole or in part, the information furnished to the undersigned.
The term “Confidential Material” does not include information which (A) is or
becomes generally available to the public other than as a result of a disclosure
by the undersigned, or (B) was lawfully within the undersigned’s possession
prior to its being furnished to the undersigned by or on behalf of the Company,
provided that the source of such information was not known by the undersigned
to
be bound by a confidentiality agreement with, or other contractual, legal or
fiduciary obligation of confidentiality to, the Company or any other party
with
respect to such information, or (C) is disclosed to the undersigned by a third
party, provided that such third party was not known by the undersigned to be
bound by a confidentiality agreement with, or other contractual, legal or
fiduciary obligation of confidentiality to, the Company or any other party
with
respect to such information.
The
undersigned hereby agrees that he will use the Confidential Material solely
in
connection with the undersigned’s performance of his duties under the employment
agreement, that the Confidential Material will be kept confidential and that
the
undersigned will not disclose any of the Confidential Material in any manner
whatsoever.
The
undersigned hereby agrees that he shall not reverse engineer, reverse assemble
or otherwise attempt to recreate or duplicate any of the Company’s
products.
In
the
event that the undersigned is requested or required (by oral questions,
interrogatories, requests for information or documents in legal proceedings,
subpoena, civil investigative demand or other similar process) to disclose
any
of the Confidential Material, the undersigned will provide the Company with
prompt written notice of any such request or requirement so that the Company
may
seek a protective order or other appropriate remedy and/or waive compliance
with
the provisions of this letter agreement. If, in the absence of a protective
order or other remedy or the receipt of a waiver by the Company, the undersigned
is, nonetheless, in the opinion of counsel, legally compelled to disclose
Confidential Material, the undersigned may, without liability hereunder,
disclose only that portion of the Confidential Material specifically required
by
an order of Court. Additionally, the undersigned shall make every reasonable
effort and take every reasonable action, including, without limitation, by
cooperating with the Company, to obtain an appropriate protective order or
other
reliable assurance that confidential treatment will be accorded the Confidential
Material.
7
Upon
termination of the Employment Agreement or at any time upon the request of
the
Company, the undersigned will promptly deliver to the Company or certify
destruction of, at the Company’s direction, all Confidential Material (and all
copies thereof) furnished to the undersigned by or on behalf of the Company
pursuant hereto. All oral Confidential Material provided to the undersigned
shall continue to be held confidential hereunder. Notwithstanding the return
or
destruction of the Confidential Material, the undersigned will continue to
be
bound by obligations of confidentiality hereunder.
The
undersigned agrees that the Company, without prejudice to any rights to judicial
relief he may otherwise have, shall be entitled to equitable relief, including
injunctive relief and specific performance, in the event of any breach of the
provisions of this letter agreement and that the undersigned will not oppose
the
granting of such relief. The undersigned also agrees that he will not seek
and
agrees to waive any requirement for the securing and posting of a bond in
connection with the Company’s seeking or obtaining such relief. In the event of
litigation relating to this letter agreement, if a court of competent
jurisdiction determines that the undersigned has breached this letter agreement,
then the undersigned will be liable to pay to the Company the reasonable legal
fees incurred in connection with such litigation, including any appeal
therefrom. Also, in the event a court of competent jurisdiction determines
that
the undersigned has not breached this letter agreement, then the Company will
be
liable to pay to the undersigned the reasonable legal fees incurred in
connection with such litigation, including any appeal therefrom.
This
letter agreement is for the benefit of the Company, and shall be construed
(both
as to validity and performance) and enforced in accordance with, and governed
by, the laws of the State of Colorado applicable to agreements made and to
be
performed wholly within such jurisdiction. This letter agreement shall remain
in
full force and effect until the earlier of the date that is three years from
the
termination of the undersigned’s employment by the Company or the date that this
agreement is terminated by the Company.
Please
confirm your agreement with the foregoing by signing and returning one copy
of
this letter to the undersigned whereupon this letter agreement shall become
a
binding agreement.
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Very
truly yours,
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/s/
Xxxxxxx X. Xxxxxxx
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Xxxxxxx
X. Xxxxxxx
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AGREED
AND ACCEPTED as
of
the
date first written above:
FRIENDLYWAY
CORPORATION
By:
/s/
Xxxxxxxxx xxx Xxxxxxxx
Xxxxxxxxx xxx Xxxxxxxx
Chief Executive Officer
8
Exhibit
“B”
AGREEMENT
NOT TO COMPETE
THIS
AGREEMENT NOT TO COMPETE is entered into by and between friendlyway Corporation,
a Nevada corporation (“Employer”), and Xxxxxxx X. Xxxxxxx
(“Employee”).
WHEREAS,
Employee is employed by Employer as President and Chief Executive Officer,
pursuant to an employment agreement (the “Employment Agreement”);
and
WHEREAS,
as a condition to such employment, Employee has agreed to sign and be bound
by
this Agreement Not to Compete; and
NOW,
THEREFORE, the parties agree as follows:
Section
1. Covenant Not to Compete. Employee acknowledges that, as a key management
employee of Employer, Employee will be involved, on a high level, in the
development, implementation and management of the national and international
business strategies and plans of Employer, which shall consist of Employer
and
such other business units, divisions, subsidiaries or other entities of Employer
as Employer shall determine in its sole discretion from time to time. By virtue
of Employee’s unique and sensitive position and special background, employment
of Employee by a competitor of Employer represents a serious competitive danger
to Employer, and the use of Employee’s talent and knowledge and information
about Employer’s business, strategies and plans can and would constitute a
valuable competitive advantage over Employer. In view of the foregoing, Employee
covenants and agrees that, if (i) Employee’s employment with Employer is
terminated for “just cause” or (ii) if Employee voluntarily resigns from his
employment with Employer, then, for a period of one year after the date of
such
termination, Employee will not engage or be engaged as, in any capacity,
directly or indirectly, including, but not limited to, employee, agent,
consultant, manager, executive, owner or stockholder (except as a passive
investor holding less than 5% equity interest in any enterprise the securities
of which are publicly traded) in any business entity engaged in competition
with
any business conducted by Employer on the date of termination. Employee further
agrees that, if his employment shall cease pursuant to the change-in-control
provision of the Employment Agreement, then, for so long thereafter as Employee
shall receive compensation under the Employment Agreement, Employee shall not
engage in the activities prohibited by the preceding sentence. This Agreement
Not to Compete shall survive the termination or expiration of the Employment
Agreement. If any court determines that this Agreement Not to Compete, or any
part hereof, is unenforceable because the duration or geographic scope of such
provision, such court shall have the power to reduce the duration or scope
of
such provision, as the case may be, and, in its reduced form, such provision
shall then be enforceable.
For
purposes of this Agreement, “just cause” shall have the same meaning as set
forth in Section VI (B) of the Employment Agreement of even date between the
parties.
Section
2. Continuing Obligations. Employee agrees that, for one year following (i)
his
termination of employment with Employer for just cause or (ii) his resignation
as an employee of Employer, Employee shall keep Employer informed of the
identification of Employee’s employer and the nature of such employment or of
Employee’s self-employment. Employer agrees that, within fifteen days after
receiving notice, pursuant to this Section 2, of the identification of the
prospective employer, the nature of the employment or self-employment or any
change therein, Employer will advise Employee as to whether such employment
constitutes a violation of Section 1 hereof.
Section
3. Injunctive Relief. Employee acknowledges that the violation of the covenants
contained in this Agreement would be detrimental and cause irreparable injury
to
Employer and its affiliates which could not be compensated by money damages.
Employee agrees that an injunction from a court of competent jurisdiction is
the
appropriate remedy for these provisions, and consents to the entry of an
appropriate judgment enjoining Employee from violating these provisions in
the
event there is a find of their breach.
Section
4. Severability of Covenants. Each of the covenants contained in this Agreement
are independent covenants, which may be available to or relied upon by Employer
and its affiliates in any court of competent jurisdiction. If any one of the
separate and independent covenants shall be deemed to be unenforceable under
the
laws of any state of competent jurisdiction, each of the remaining covenants
shall not be affected thereby. Notwithstanding the provisions of this Section
4,
it is understood that every benefit received by Employee by virtue of this
Agreement is consideration for each separate covenant contained
herein.
9
Section
5. Governing Law. This Agreement shall be governed by the laws of the State
of
Colorado.
Section
6. Other Remedies. The undertakings herein shall not be construed as any
limitation upon the remedies
Employer
might, in the absence of this Agreement, have at law or in equity.
INTENDING
to be legally bound hereby, Employer and Employee hereby duly execute this
Agreement Not to Compete as of the date indicated below.
|
FRIENDLYWAY
CORPORATION
|
|
|
Date:
April 27, 2006
|
By:/s/
Xxxxxxxxx xxx
Xxxxxxxx
|
|
|
Xxxxxxxxx
xxx Xxxxxxxx
|
|
Chief
Executive Officer
|
|
|
Date:
April 27, 2006
|
/s/
Xxxxxxx X.
Xxxxxxx
|
|
|
Xxxxxxx
X. Xxxxxxx
|
10
