EMPLOYMENT AGREEMENT EXHIBIT 10.12
Agreement made and entered into as of the Eighteenth day of December
1998, by and between INTERNET COMMERCE CORPORATION, a Delaware corporation,
having a place of business at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
("Employer" or "Company"), and Xxxxxx Xxxxxx, residing at 0000 X Xxxxxx Xxxxxx
Xxxxx, Xxxxxx Xxxxx, Xxxxxxx 00000 ("Employee").
WHEREAS, Employer is engaged in the business of designing and marketing
electronic document interchange systems and desires to employ Employee as
Chairman and Chief Executive Officer of Employer and Employee desires to be
employed by Employer, all pursuant to the terms and conditions hereinafter set
forth;
NOW, THEREFORE, in consideration of the foregoing and the mutual
promises and covenants herein contained, it is agreed as follows:
1. EMPLOYMENT: DUTIES.
Employer hereby agrees to employ Employee, and Employee hereby agrees to
accept employment during the term hereof on a full-time basis, as Chief
Operating Officer, and shall perform such services as are customarily performed
by persons holding such office, and shall be subject at all times to the
direction of the Chief Executive Officer and Board of Directors of Employer.
Place of employment, when Employee is not engaged in travel on Company business,
shall be the New York City area, unless otherwise agreed. Nothing herein
contained shall be construed as (a) preventing Employee from investing his
personal assets in any business which does not compete directly or indirectly
with Employer and does not involve any diversion of employee's business time, or
(b) preventing Employee from purchasing securities in any corporation whose
securities are regularly traded, if such purchases shall not result in his
owning beneficially at any time 1% or more of the equity securities of any
corporation engaged in a business, which is competitive, directly or indirectly,
to that of Employer.
2. TERM.
(a) The term of this agreement shall be for a term commencing on
December 18, 1998 and ending two years thereafter.
3. COMPENSATION.
(a) As full compensation for the performance of his duties on behalf of
Employer, Employer shall pay Employee a xxxx salary at the rate of $120,000 per
annum, payable in installments in accordance with the usual practice of
Employer.
(b) Employer shall reimburse Employee only for reasonable expenses
incurred by Employee in connection with his duties hereunder upon presentation
by Employee of the details of and vouchers for such expenses in accordance with
customary Employer practice.
(c) Employee shall be eligible for all executive benefits approved by
the Board of Directors which shall include the same medical benefits provided
for executives of Internet Commerce Corporation.
(d) Employee shall be entitled to 20 days of vacation per year, of which
5 may be carried over into the following year up to a cumulative total of 10
days carried over.
(e) Employee shall be granted 50,000 options to purchase the Company's
Class A Common Stock pursuant to the Company's Employee Stock Option Plan at
$3.875 per share, one-third of which will vest upon employment and the balance
of which vest in 20% increments when the Company's Class A Common Stock attains
or exceeds each of the following per share bid prices for 20 consecutive trading
days: $7.50, $10.00, $12.50, $15.00 and $ 17.50.
4. INTELLECTUAL PROPERTY.
(a) The Employee hereby assigns to the Company all of his right, title
and interest in and to all inventions, discoveries, improvements, ideas,
formulas, systems and related documentation and other works of authorship which
are directly or indirectly related to the actual or presently anticipated
business activities of the Company or its affiliates (hereinafter referred to as
"Intellectual Property"), whether or not patentable, copyrightable or entitled
to or eligible for other forms of protection, which during the term of the
Employee's employment by the Company the Employee may create, develop, write or
conceive, whether during or outside of regular working hours on the Company's
premises, either alone or together with others (including others not employed by
the Company or any subsidiary or affiliate of the Company), in whole or in part,
either (i) in the course of such employment, (ii) relating to the business or
research and development efforts of the Company or any of its subsidiaries or
(iii) with the use of the time, materials, private or proprietary information or
facilities of the Company or any of its subsidiaries.
(b) The Employee further agrees, without charge to the Company, but at
the Company's expense, (i) to disclose promptly to the Company all such
Intellectual Property, (ii) at the Company's request, to execute and deliver
promptly a specific assignment to the Company of any right, title and interest
to such Intellectual Property, including proprietary rights arising from patent
applications, and (iii) to take promptly any other action that may be reasonably
necessary on the part of the Employee to enable the Company to obtain patents,
copyrights or other forms of protection for such Intellectual Property in the
United States and other countries.
5. NON-COMPETITION.
The Employee acknowledges that his employment by the Company brings him
into close contact with many confidential affairs of the Company, including,
without limitation, information about inventions, improvements, modifications,
discoveries, costs, profits, markets, sales, products, key personnel, pricing
policies, operational methods, concepts, technical processes and applications
and other business affairs and methods of the Company
(collectively referred to hereinafter as Information). The Employee further
acknowledges that his employment by the Company involves the performance of
services that are of a special, unique, unusual, extraordinary and intellectual
character, and that the relationships between the Company and its officers,
employees, agents, consultants, suppliers, independent contractors and customers
constitute a valuable asset of the Company. In recognition of the foregoing, the
Employee covenants and agrees:
(a) During the term of this Agreement and for a period of twenty-four
(24) months from date of termination of his employment hereunder for whatever
reason, that he will not solicit any customers who are presently or may
hereafter become customers of Employer unless such solicitation is entirely
unrelated to Employer's business, or compete in any way with Employer alone or
together with others in any state or foreign country in which (i) a facility of
the Employer is located, (ii) Employer is engaged in business at the time of
termination of employment, or (iii) where Employee knows Employer intends to
carry on business in such area by expansion of its activities within two (2)
years following termination.
(b) Subsequent to the termination of this agreement, Employee will not
interfere with or disrupt or attempt to disrupt Employer's business relationship
with its customers or suppliers or solicit the employees of Employer.
(c) During the term of this Agreement and after termination of the
Employment Period, for whatever reason, except in connection with his employment
Employee will not disclose or use or enable anyone else to use any Information
which may be obtained by him or available to him during the term of employment
whether or not the Information will be considered proprietary or secret.
(d) In the event that Employee breaches any provisions of this paragraph
5, or there is a threatened breach, then, in addition to any other rights which
Employer may have, Employer shall be entitled to injunctive relief to enforce
the restrictions contained herein. In the event that an actual proceeding is
brought in equity to enforce the provisions of this paragraph, Employee shall
not urge as a defense that there is an adequate remedy at law nor shall Employer
be prevented from seeking any other remedies which may be available.
(e) The existence of any claim or cause of action by Employee against
Employer; whether predicated upon this Agreement or otherwise, shall not
constitute a defense to the enforcement by Employer of the foregoing restrictive
covenants but shall be litigated separately.
6. REPRESENTATIONS AND WARRANTIES OF EMPLOYEE.
Employee represents and warrants to Employer that (a) Employee is under
no contractual or other restriction or obligation which is inconsistent with the
execution of this Agreement, the performance of his duties hereunder, or the
rights of Employer hereunder and (b) Employee is under no physical or mental
disability that would hinder his performance of duties under this Agreement.
7. TERMINATION.
(a) Anything to the contrary notwithstanding, this Agreement shall
terminate before the expiration of the term hereof in the event of the
Employee's (i) death or (ii), at the discretion of Employer, disability for at
period of twenty (20) consecutive weeks.
(b) Employee's employment may also be terminated by the Employer before
the expiration of the term hereof only for cause as herein defined. Cause shall
mean any of the following occurrences:
(i) The Employee's conviction of a felony by a court of competent
jurisdiction (which conviction, through lapse of time or otherwise, is not
subject to appeal); or
(ii) The Employee's commission of an act of fraud or embezzlement upon
the Employer; or
(iii) The failure by the Employee to devote such time or perform such
services as are required hereunder.
8. NOTICES.
All notices hereunder shall be in writing and shall be delivered in
person or given by registered or certified mail, postage prepaid, and sent to
the parties at the respective addresses above set forth. Either party may
designate any other address to which notice shall be given, by giving notice to
the other of such change of address in the manner herein provided.
9. SEVERABILITY OF PROVISIONS.
If any provision of this Agreement shall be declared by a court of
competent jurisdiction to be invalid, illegal or incapable of being enforced in
whole or in part, the remaining conditions and provisions or portions thereof
shall nevertheless remain in full force and effect and enforceable to the extent
they are valid, legal and enforceable, and no provision shall be deemed
dependent upon any other covenant or provision unless so expressed herein.
10. GOVERNING LAW.
This Agreement shall be construed and governed by the laws of the State
of New York.
11. NON-WAIVER.
The failure of either party to insist upon the strict performance of any
term or condition in this Agreement shall not be considered a waiver or
relinquishment of future compliance therewith.
12. BINDING EFFECT.
Employee's rights and obligations under this Agreement shall not be
transferable by assignment or otherwise, such rights shall not be subject to
commutation, encumbrances, or the claims of Employee's creditors, and any
attempt to do any of the foregoing shall be void. The provisions of the
Agreement shall be binding upon and inure to the benefit of Employee and his
heirs and personal representatives.
13. NO THIRD PARTY BENEFICIARIES.
This Agreement does not create, and shall not be construed as creating,
any rights enforceable by any person not a party to this Agreement (except as
provided in Section 12).
14. HEADINGS.
The headings in this Agreement are solely for the convenience of
reference and shall be given no effect in the construction or interpretation of
this Agreement.
15. ENTIRE AGREEMENT: MODIFICATION.
This Agreement contains the entire agreement between the parties
relating to the subject matter hereof. No modification of this Agreement shall
be valid unless it is made in writing and signed by the parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
INTERNET COMMERCE CORPORATION, Employer
By: _____________________ /s/ Xxxxxx Xxxxxx
-----------------
Xxxxxx Xxxxxx
