EXHIBIT 10.6
EMPLOYMENT, NON-COMPETITION
AND PROPRIETARY RIGHTS AGREEMENT
THIS EMPLOYMENT, NON-COMPETITION AND PROPRIETARY RIGHTS AGREEMENT (the
"Agreement") is made as of this 26th day of April, 2004, by and between CAPITAL
GROWTH SYSTEMS, INC., a Florida corporation (the "Company"), and XXXXX XXXXX
(the "Employee").
RECITALS:
A. The Company is the parent of Nexvu Technologies, L.L.C., a Delaware
limited liability company (the "Subsidiary") in the business of providing
products and software solutions to the networked computer industry;
B. The Company desires to employ the Employee and Employee desires to
be employed by the Company to serve as the Chief Executive Officer of the
Company and the Subsidiary; and
C. It is contemplated that in such capacity, Employee shall provide
services for the Company and for the Subsidiary.
NOW, THEREFORE, in consideration of the foregoing and the agreements,
covenants and conditions set forth herein, the Employee and the Company hereby
agree as follows:
ARTICLE I
EMPLOYMENT
Section 1.1 Employment. The Company hereby employs, engages and hires
Employee, and Employee hereby accepts employment, upon the terms and conditions
set forth in this Agreement. The Employee shall constitute an employee of the
Company, but shall provide services to both the Company and its Subsidiary.
During the term of this Agreement, Employee shall hold the title of Chief
Executive Officer of the Company and of the Subsidiary. The Employee shall have
and fully perform the duties and responsibilities as may be, from time to time,
specified by the Company's President or its Board of Directors. The Employee
shall report to the Chief Executive Officer of the Company and to its Board of
Directors.
Section 1.2 Activities and Duties During Employment. Employee
represents and warrants to the Company that Employee is free to accept
employment with the Company and that Employee has no prior or other commitments
or obligations of any kind to anyone else which would hinder or interfere with
the acceptance and performance of the obligations under this Agreement.
Employee accepts the employment described in Article 1 of this
Agreement and agrees to devote his exclusive full time and efforts to the
faithful and diligent performance of the services described herein, including
the performance of such other services and responsibilities as the
Company may, from time to time, stipulate. Notwithstanding the foregoing,
Employee may: (i) serve on the board of directors of other entities or serve in
any capacity with any hobby, avocation, civic, educational, professional or
charitable organization provided that such service does not materially interfere
or conflict with his duties hereunder; and (ii) make and manage personal
investments of his choice.
ARTICLE II
TERM
Section 2.1 Term. The term of employment under this Agreement shall be
for the period from the date first set forth above until December 31, 2004 (such
term of employment, as it may be extended or terminated, is herein referred to
as the "Employment Term"). The Employment Term shall automatically renew for
additional one (1) year periods unless terminated by Employee or the Company by
written notice not less than two (2) months prior to expiration of the
then-current term.
Section 2.2 Termination. The Employment Term and employment of Employee
may be terminated as follows:
(a) Automatically, without the action of either party, upon
the death of Employee.
(b) By either party upon the Total Disability of the Employee.
The Employee shall be considered to have a Total Disability for
purposes of this Agreement if he is unable by reason of accident or
illness to substantially perform his employment duties, and is expected
to be in such condition for periods totaling three (3) months (whether
or not consecutive) during any period of twelve (12) consecutive
months. The determination of whether a Total Disability has occurred
shall be based on the determination of a physician selected by the
Company. Nothing herein shall limit the Employee's right to receive any
payments to which Employee may be entitled under any disability or
employee benefit plan of the Company or under any disability or
insurance policy or plan. During a period of Total Disability prior to
termination hereunder, Employee shall continue to receive his full
compensation (including base salary and bonus) and benefits.
(c) By the Employee upon thirty (30) days' written notice to
the Company.
(d) By Company "Without Cause," which shall mean a termination
of the Employee's employment by the Company other than pursuant to the
provisions of Section2.2(a), Section 2.2(b) or Section 2.2(e) hereof.
(e) By the Company "With Cause," which shall mean termination
of Employee's employment due to: (i) a breach of this Agreement by
Employee; (ii) commission of an act of dishonesty, malfeasance, fraud
or willful misconduct; (iii) failure to use good faith efforts to
perform any duties assigned to Employee by the Company; or (iv)
violation of any law (as determined in the good faith judgment of the
Company).
Section 2.3 Cessation of Rights and Obligations: Survival of Certain
Provisions. On the date of expiration or earlier termination of the Employment
Term for any reason, all of the respective rights, duties, obligations and
covenants of the parties, as set forth herein, shall, except as specifically
provided herein to the contrary, cease and become of no further force or effect
as of the date of said termination, and shall only survive as expressly provided
for herein.
Section 2.4 Cessation of Compensation. In lieu of any severance under
any severance plan that the Company may then have in effect, and subject to (i)
the receipt of a full and unconditional release from Employee and (ii) any
amounts owed by the Employee to the Company under any contract, agreement or
loan document entered into after the date hereof (including, but not limited to,
loans made by the Company to the Employee), the Company shall pay to the
Employee, and the Employee shall be entitled to receive, the following amounts
within thirty (30) days of the date of a termination of his employment:
(a) Voluntary Termination/Cause/Expiration of Term. Upon (i)
termination of the Employee's employment pursuant to Section 2.2(c) or
Section 2.2(e); or (ii) the expiration of the Employment Term because
either party elects not to extend the Employment Term; the Employee
shall be entitled to receive his base salary, any incentive
compensation (earned to date of termination) and expense reimbursements
solely through the date of termination.
(b) Death or Total Disability. Upon the termination of the
Employment Term by reason of the death or Total Disability of the
Employee, or pursuant to Section 2.2(d) the Employee (or, in the case
of death, his estate) shall be entitled to receive in a lump sum his
base salary through the date of death plus ninety (90) days, or
determination of Total Disability plus ninety (90) days (which shall
include any of his unused vacation pay for the year of such
termination), unpaid bonus (if any, to the extent express provision has
been made for a bonus) and expense reimbursement through the date of
death or Total Disability.
(c) Failure to Renew/Termination Without Cause. Upon
termination of Employee's employment pursuant to Section 2.2(d) or upon
termination of Employee's employment due to the Company's delivery of
written notice that it elects not to extend the Employment Term for an
additional one-year period, then Executive shall be entitled to
receive:
(i) payment of his base salary over a period of one
(1) year from the date of termination of employment, payable
in the same increments (e.g., semi-monthly if that is the
common payroll practice) as was the practice prior to
termination of employment; plus
(ii) any incentive compensation earned by Employee
through the date of termination of his employment.
Section 2.5 Business Expenses.
(a) Reimbursement. The Company shall reimburse the Employee
for all reasonable, ordinary, and necessary business expenses incurred
by him in connection
with the performance of his duties hereunder, including, but not
limited to, ordinary and necessary travel, lodging and dining expenses
and entertainment expenses. The reimbursement of business expenses will
be governed by the policies for the Company and the terms otherwise set
forth herein.
(b) Accounting. The Employee shall provide the Company with an
accounting of his expenses, which accounting shall clearly reflect
which expenses were incurred for proper business purposes in accordance
with the policies adopted by the Company and as such are reimbursable
by the Company. The Employee shall provide the Company with such other
supporting documentation and other substantiation of reimbursable
expenses as will conform to Internal Revenue Service or other
requirements. All such reimbursements shall be payable by the Company
to the Employee within a reasonable time after receipt by the Company
of appropriate documentation therefor.
ARTICLE III
COMPENSATION AND BENEFITS
Section 3.1 Compensation. During Employee's employment, the Company
shall pay Employee a base salary of $175,000 per annum, subject to increase in
the sole discretion of the Company. The Employee shall be eligible to earn a
bonus with respect to each calendar year in which Employee is employed (prorated
for factual years) of up to fifty percent (50%) of Employee's base salary upon
attainment by the Company and/or Employee of such objectives (subject to such
weighting and other factors as appropriate) as established by the Board of
Directors after consultation with Employee with respect to each calendar year.
The Company shall use its good faith efforts to establish such objectives no
later than March 31st of each year during the Employment Term, and to deliver a
copy of the same to Employee.
Section 3.2 Payment. All compensation shall be payable in intervals in
accordance with the general payroll payment practice of the Company. The
compensation shall be subject to such withholdings and deductions by the Company
as are required by law.
Section 3.3 Vacation. The Employee shall be entitled to up to four (4)
weeks' paid vacation per year (prorated for partial years). Two (2) weeks in the
aggregate of vacation shall carry over to subsequent years (no cash in lieu of
vacation not taken), and all vacation not taken in excess of two (2) weeks shall
lapse (i.e., in no event can cumulative rollover exceed two (2) weeks).
Section 3.4 Options and Other Payments. The Company has awarded to
Employee effective as of the date of execution hereof an option (the "Option")
to purchase up to 430,000 shares of Common Stock in the form attached hereto as
Exhibit A.
Section 3.5 Other Benefits. Employee shall be entitled to participate
in any retirement, pension, profit-sharing, stock option, health plan,
insurance, disability income, incentive compensation and welfare or any other
benefit plan or plans of the Company which may now or hereafter be in effect and
for which the Employee is eligible or for which all senior
executives in general are eligible. Notwithstanding the forgoing, the Company
shall be under no obligation to institute or continue the existence of any such
benefit plan. Commencing no later than April 30, 2004, and continuing throughout
the Employment Term, the Company shall maintain directors' and officers'
liability insurance with aggregate coverage of not less than $1,000,000.
Section 3.6 Bonus. If during the Employment Term Employee is employed
by the Company and the Company enters into a contract (the "Sale Contract"):
(a) for the sale of all or substantially all of its assets; or
(b) to be merged into another larger company (or that
company's subsidiary - collectively, the "Acquirer") pursuant to which
the shareholders of the Company receive capital stock of the Acquirer,
and the Sale Contract closing is effected within one hundred eighty
(180) days thereafter for an aggregate net consideration received by
the Company's shareholders as a result of such transaction and after
deduction of all associated transaction expenses (the "Net
Consideration") (whether in cash or in kind, based upon a valuation as
of the closing date as determined by the Company's Board of Directors
in good faith), exceeds two (2) times the "Base Amount." The Base
Amount will be the sum of:
(i) aggregate capital contributions made to the
Company and its subsidiaries; plus
(ii) the amount of consideration paid by the Company
for any acquisition made by it or any of its subsidiaries from
time to time (with non-cash consideration valued in good faith
discretion of the Board of Directors),
then Employee shall be entitled to a bonus ("Sale Bonus") payable no
later than ten (10) days following the closing of the Sale Contract
equal to the lesser of 299% of Employee's base salary as of the date of
such Sale Contract or the "Sale Bonus Amount" as set forth below. If
the sale or merger is not consummated, then the Sale Bonus shall not be
payable.
The Sale Bonus Amount shall be an amount equal to the product of 1%
multiplied by the "Difference". The "Difference" will be the amount or
value which the shareholders of the Company receive on the day of
closing of the Sale Contract (measured as of the close of business on
that day) in excess of the "Product." The "Product" will be the number
of shares of the Company's common stock issued and outstanding on the
closing date (in computing common stock, any-in-the-money stock
options, warrants, rights or other securities convertible into common
stock shall be deemed to constitute common stock on an as converted
basis), multiplied by the "Original Issue Price." The Original Issue
Price is the highest per share price at which the Company's common
stock is sold by the Company (as adjusted for stock splits, reverse
splits, etc.) in a tranche of not less than $100,000 of funding. For
example, if on December 31, 2004 the Company is merged into Company X
for stock valued on that date of $100,000,000 and on that date there
were 20,000,000 shares of common stock outstanding and 2,000,000
in-the-money
options, and the Original Issue Price was $2.00, then for purposes of
the bonus computation, the Difference would be $100,000,000 minus
$60,000,000 or $40,000,000, and the Sale Bonus would therefore be
$400,000.
The good faith determination of the Sale Bonus amount by the Company's Board of
Directors shall be binding on Employee absent manifest error; provided, further,
that the Sale Bonus shall not be payable to Employee in the event that the
Acquirer desires that Employee serve as an employee of the Acquirer for a total
annual compensation package no less than Employee's then existing total annual
compensation package and Employee refuses to enter into an employment agreement
with the Acquirer containing such provision.
Section 3.7 Section 280G Covenant. The parties hereby agree that the
Company shall not be required to pay Employee any amount that would be an
"excess parachute payment" within the meaning of Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code"), and payments otherwise required
under this Agreement shall be reduced, if necessary to prevent any such
payments. The prior sentence shall be interpreted consistent with the purpose of
avoiding the disallowance of deduction to the Company pursuant to Section
280G(a) of the Code.
ARTICLE IV
CONFIDENTIALITY, NON-SOLICITATION, NON-COMPETE
AND QUIT CLAIM AGREEMENT
Section 4.1 Non-Disclosure of Confidential Information. Employee hereby
acknowledges and agrees that the duties and services to be performed by Employee
under this Agreement are special and unique and that as of a result of the
employment hereunder, Employee will acquire, develop and use information of a
special and unique nature and value that is not generally known to the public or
to the Company's industry, including but not limited to, certain records, phone
locations, documentation, software programs, price lists, customer lists,
contract prices for the Company's services, business plans and prospects of the
Company, equipment configurations, ledgers and general information, employee
records, mailing lists, accounts receivable and payable ledgers, financial and
other records of the Company or its affiliates, and other similar matters (all
such information being hereinafter referred to as "Confidential Information").
Employee further acknowledges and agrees that the Confidential Information is of
great value to the Company and its affiliates and that the restrictions and
agreements contained in this Agreement are reasonably necessary to protect the
Confidential Information and the goodwill of the Company. Accordingly, Employee
hereby agrees that:
(a) Employee will not, while employed by the Company or for
four (4) years thereafter, directly or indirectly, except in connection
with Employee's performance of the duties under this Agreement, or as
otherwise authorized in writing by the Company for the benefit of the
Company, divulge to any person, firm, corporation, limited liability
company, or organization, other than the Company (hereinafter referred
to as "Third Parties"), or use or cause or authorize any Third Parties
to use, the Confidential Information, except as required by law; and
(b) Upon the termination of Employee's employment for any
reason whatsoever, Employee shall deliver or cause to be delivered to
the Company any and all Confidential Information, including drawings,
notebooks, notes, records, keys, disks data and other documents and
materials belonging to the Company which is in his possession or under
his control relating to the Company, regardless of the medium upon
which it is stored, and will deliver to the Company upon such
termination of employment any other property of the Company which is in
his possession or control.
Section 4.2 Non-Solicitation Covenant. Employee hereby covenants and
agrees that while employed by the Company and for a period of two (2) years
following the termination of Employee's employment with the Company for any
reason, Employee shall not (i) directly or indirectly, contact, solicit,
interfere with, or entice away from the Company any person, firm, corporation,
limited liability company or other entity that was a customer of the Company at
any time while Employee was an employee of the Company or who is a "prospective
vendor or customer" of the Company, or (ii) induce or attempt to induce any
employee (or any person who was an employee during the year preceding the date
of any solicitation) of the Company to leave the employ of the Company, or in
any way interfere with the relationship between any such employee and the
Company. For purposes hereof, "prospective vendor or customer" shall mean any
person or entity which has been solicited for business by Employee or any
officer or other employee of the Company or its Affiliates at any time during
Employee's employment.
Section 4.3 Non-Competition Covenant. Employee acknowledges that the
covenants set forth in this Section 4.3 are reasonable in scope and essential to
the preservation of the Business of the Company (as defined herein). Employee
also acknowledges that the enforcement of the covenants set forth in this
Section 4.3 will not preclude Employee from being gainfully employed in such
manner and to the extent as to provide a standard of living for himself, the
members of his family and the others dependent upon him of at least the level to
which he and they have become accustomed and may expect. In addition, Employee
acknowledges that the Company has obtained an advantage over its competitors as
a result of its name, location and reputation that is characterized by near
permanent relationships with vendors, customers, principals and other contacts
which it has developed at great expense. Furthermore, Employee acknowledges that
competition by him following the termination or expiration of his employment
would impair the operation of the Company beyond that which would arise from the
competition of an unrelated third party with similar skills. Employee hereby
agrees that he shall not, during his employment and for a period of one (1) year
after the end of his employment, directly or indirectly, engage in or become
directly or indirectly interested in any proprietorship, partnership, firm,
trust, company, limited liability company or other entity, other than the
Company (whether as owner, partner, trustee, beneficiary, stockholder, member,
officer, director, employee, independent contractor, agent, servant, consultant,
manager, lessor, lessee or otherwise) that:
(a) competes with the Company in the Business of the Company;
or
(b) competes at a material level with the Company in the
Restricted Territory (as defined herein), other than acquiring an
ownership interest in a company listed on a recognized stock exchange
in an amount which does not exceed five percent (5%) of the outstanding
stock of such corporation. For purposes of this Agreement:
(i) the term "Business of the Company" shall include
all business activities and ventures related to the business
of providing of any of the following:
(A) provision of application performance
management tools, software, equipment or consulting
services related to application performance
management; or
(B) solutions to the call center business in
a manner competitive with the activities of the
Company at any time during the term of Employee's
employment or expressly contemplated during the term
of Employee's employment with the Company; or
(C) all other businesses in which the
Company is engaged in as of the date of termination
of Employee's employment; and
(ii) the term "Restricted Territory" means any state
in the United States of America. The Employee specifically
acknowledges that the Business of the Company is not naturally
restricted by any geographic boundaries.
Section 4.4 Remedies.
(a) Injunctive Relief. Employee expressly acknowledges and
agrees that the Business of the Company is highly competitive and that
a violation of any of the provisions of Sections 4.1, 4.2 or 4.3 would
cause immediate and irreparable harm, loss and damage to the Company
not adequately compensable by a monetary award. Employee further
acknowledges and agrees that the time periods and territorial areas
provided for herein are the minimum necessary to adequately protect the
Business of the Company, the enjoyment of the Confidential Information
and the goodwill of the Company. Without limiting any of the other
remedies available to the Company at law or in equity, or the Company's
right or ability to collect money damages, Employee agrees that any
actual or threatened violation of any of the provisions of Sections
4.1, 4.2 or 4.3 may be immediately restrained or enjoined by any court
of competent jurisdiction, and that a temporary restraining order or
emergency, preliminary or final injunction may be issued in any court
of competent jurisdiction, without notice and without bond.
Notwithstanding anything to the contrary contained in this Agreement,
the provisions of this Article IV shall survive the termination of
Employee's employment.
(b) Enforcement. It is the desire of the parties that the
provisions of Sections 4.1, 4.2 or 4.3 be enforced to the fullest
extent permissible under the laws and public policies in each
jurisdiction in which enforcement might be sought. Accordingly, if any
particular portion of Sections 4.1, 4.2 or 4.3 shall ever be
adjudicated as invalid or unenforceable, or if the application thereof
to any party or circumstance shall be adjudicated to be prohibited by
or invalidated by such laws or public policies, such section or
sections shall be (i) deemed amended to delete therefrom such portions
so adjudicated or (ii) modified as determined appropriate by such a
court, such deletions or modifications to apply only with respect to
the operation of such section or sections in the
particular jurisdictions so adjudicating on the parties and under the
circumstances as to which so adjudicated.
(c) Legal Fees. In any action to enforce the terms of this
Agreement, the prevailing party shall be entitled to reimbursement from
the other party of reasonable legal fees and costs.
Section 4.5 Company. All references to the Company in this Article 4
shall include "Affiliates" of the Company, as that term is construed under Rule
405 of the Securities Act of 1933, as amended, including but not limited to any
subsidiary of the Company.
Section 4.6 Quit Claims. By execution of this Agreement, Employee: (i)
assigns and quit claims to the Company all right, title and interest as relates
to the Business of the Company in (x) any patentable or potentially patentable
invention or design within the meaning of Title 35 of the United States Code,
and any utility or design created or discovered by Employee prior to the date
hereof or during the course of his employment with the Company and (y) all
copyright interests owned or claimed by Employee pertaining to all media,
devices and documentation comprising all of the software used in the Business as
of the date hereof; and (ii) agrees that if during the course of his employment
by the Company, he discovers, invents or produces, without limitation, any
information, formulae, product, device, software, system, technique, drawing,
program or process, which is a "trade secret" within applicable law or deemed to
be such in the opinion of the Company's board of directors, such information
formulae, product, device, system, technique, drawing, program or process shall
be assigned to the Company. Employee agrees to fully cooperate with the Company
in protecting the value and secrecy of any such trade secrets, and further
agrees to execute any and all documents the Company deems necessary to document
any such assignment to the Company. Employee designates the Company his
attorney-in-fact to execute any documents the Company may deem necessary that
relates to any such trade secret or assignment thereof to the Company.
Notwithstanding anything to the contrary herein, this Agreement does
not apply to any invention for which no equipment, supplies, facility or trade
secret information of the Company was used and which was developed entirely on
the Employee's own time, unless: (a) the invention relates: (i) to the Business
of the Company; or (ii) to the Company's actual demonstrably anticipated
research or development; or (b) the invention results from any work performed by
the Employee for the Company.
Section 4.7 Consideration for Covenants. Employee acknowledges and
agrees that the Company's willingness to engage in its acquisition of the
Subsidiary (by merger of the Subsidiary with a subsidiary of the Company) and to
raise the capital necessary to effect the aforesaid merger was conditioned upon
Employer's representation that he would execute an employment agreement
subsequent to the merger containing restrictive covenants of the nature
contained herein (an "Employment Agreement") and Employee further acknowledges
that the grant of the Option was conditioned upon Employee's willingness to
enter into an Employment Agreement and to effect the undertakings set forth
herein.
Section 4.8 Mitigation of Damages. Employee agrees that in the event of
termination of his employment for whatever reason, to use his good faith efforts
to obtain alternate
employment. Any employment and/or independent contractor compensation earned
directly or indirectly by Employee or his Affiliates during the one (1) year
period following termination of employment by the Company or any subsidiary of
the Company shall be credited dollar-for-dollar against any compensation payable
to Employee pursuant to Section 2.4(c) hereof.
ARTICLE V
MISCELLANEOUS
Section 5.1 Notices. All notices or other communications required or
permitted hereunder shall be in writing and shall be deemed given, delivered and
received:
(a) when delivered, if delivered personally;
(b) four (4) days after mailing, when sent by registered or
certified mail, return receipt requested and postage prepaid;
(c) one (1) business day after delivery to a private courier
service, when delivered to a private courier service providing
documented overnight service; and
(d) on the date of delivery if delivered by telecopy, receipt
confirmed, provided that a confirmation copy is sent on the next
business day by first class mail, postage prepaid, in each case
addressed as follows:
IF TO COMPANY, TO: IF TO EMPLOYEE, TO:
Capital Growth Systems, Inc. To the address set forth
c/o Nexvu Technologies, L.L.C. directly below his signature
Attention: President
0000 Xxxx Xxxxxxxxx Xxxx - Xxxxx 000
Xxxxxxxxxx, XX 00000
Any party may change its address for purposes of this paragraph by
giving the other party written notice of the new address in the manner
set forth above.
Section 5.2 Entire Agreement; Amendments, Etc. This Agreement contains
the entire agreement and understanding of the parties hereto, and supersedes all
prior agreements and understandings relating to the subject matter hereof.
Except as provided in Section 4.4(b) above, no modification, amendment, waiver
or alteration of this Agreement or any provision or term hereof shall in any
event be effective unless the same shall be in writing, executed by both parties
hereto, and any waiver so given shall be effective only in the specific instance
and for the specific purpose for which given. The obligations of the parties
under this Agreement shall survive any termination of this Agreement.
Section 5.3 Benefit. This Agreement shall be binding upon, and inure to
the benefit of, and shall be enforceable by, the heirs, successors, legal
representatives and permitted assignees of Employee and the successors,
assignees and transferees of the Company. The Subsidiary shall be an intended
third party beneficiary of the terms of this Agreement. This Agreement or any
right or interest hereunder may not be assigned by Employee without the prior
written consent of the Company. The Company may assign this Agreement to any
successor as interest to a majority of its business.
Section 5.4 No Waiver. No failure or delay on the part of any party
hereto in exercising any right, power or remedy hereunder or pursuant hereto
shall operate as a waiver thereof; nor shall any single or partial exercise of
any such right, power or remedy preclude any other or further exercise thereof
or the exercise of any other right, power or remedy hereunder or pursuant
thereto.
Section 5.5 Severability. Wherever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law but, if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement. If any part of any
covenant or other provision in this Agreement is determined by a court of law to
be overly broad thereby making the covenant unenforceable, the parties hereto
agree, and it is their desire, that the court shall substitute a judicially
enforceable limitation in its place, and that as so modified the covenant shall
be binding upon the parties as if originally set forth herein.
Section 5.6 Compliance and Headings. Time is of the essence of this
Agreement. The headings in this Agreement are intended to be for convenience and
reference only, and shall not define or limit the scope, extent or intent or
otherwise affect the meaning of any portion hereof.
Section 5.7 Governing Law. The parties agree that this Agreement shall
be governed by, interpreted and construed in accordance with the laws of the
State of Illinois, and the parties agree that any suit, action or proceeding
with respect to this Agreement shall be brought in the courts of Xxxx County in
the State of Illinois or in the U.S. District Court for the Northern District of
Illinois. The parties hereto hereby accept the exclusive jurisdiction of those
courts for the purpose of any such suit, action or proceeding. Venue for any
such action, in addition to any other venue permitted by statute, will be Xxxx
County, Illinois. All parties hereto waive their right to trial by jury with
respect to the adjudication of any dispute hereunder.
Should Employee dispute the basis for his termination "For Cause," such
dispute shall be determined by arbitration to be conducted in Chicago, Illinois
pursuant to the rules of the American Arbitration Association ("AAA") by an
arbitrator mutually agreeable to the parties, or should they fail to agree, then
by an arbitrator who is a member of the AAA selected by two arbitrators who are
members of the AAA, one of whom is selected by each of the parties. The
arbitration shall be conducted in accordance with the rules of the AAA, with the
cost of the arbitrator to be borne equally by the parties and with each party to
bear his or its respective legal costs and fees associated with the arbitration.
Section 5.8 Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed an original and all of which together
will constitute one and the same instrument.
Section 5.9 Recitals. The Recitals set forth above are hereby
incorporated in and made a part of this Agreement by this reference.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed and delivered as of the day and year first above
written.
COMPANY: EMPLOYEE:
CAPITAL GROWTH SYSTEMS, INC. ________________________________________
XXXXX XXXXX
By:_____________________________ Address:________________________________
Its:____________________________ ________________________________
EXHIBIT A
OPTION TO PURCHASE 430,000 SHARES
