EMPLOYMENT AGREEMENT
This Agreement made this 1st day of November, 1996, by and between
1MAGE Software, Inc. (hereinafter "ISI"), employed at ISI located at 0000
X. Xxxxxx Xx., Xxxxxxxxx, Xxxxxxxx and Xxxxx X. XxXxxxx (hereinafter
"Employee").
RECITALS
WHEREAS, ISI desires to assure itself of the service of Employee and
to that end desires to enter into a contract of employment with him, upon
the terms and conditions herein set forth, and
WHEREAS, Employee is desirous of entering into such a contract of
employment as ISI President and CEO;
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein set forth, the parties hereto agree as follows:
1. EMPLOYMENT. ISI hereby employs Employee and the Employee hereby
accepts employment upon the terms and conditions hereinafter set forth.
2. TERM. Subject to the provisions for termination as hereinafter
provided, the term of this Agreement shall begin on the date of this
Agreement and shall terminate on October 31, 1999. This Agreement can
then be modified annually by mutual consent of both parties.
3. COMPENSATION. For all services rendered by the Employee under
this Agreement, ISI shall compensate the Employee annually with an
executive compensation package in accordance with the recommendations of
the Compensation Committee of the Board of Directors (hereinafter the
"Board") of ISI. ISI agrees that the annual salary as defined by the
Compensation Committee will not be less than the amount authorized in the
minutes of the meeting held on 9/4/1996 during the term of this Agreement
unless stipulated by the Employee. ISI further agrees that the
Compensation Committee will review the executive compensation package
annually, in accordance with the anniversary date of the Agreement.
a. The Board or the Compensation Committee shall grant a
sufficient number of ten-year options to the Employee under the 1996
Equity Incentive Plan or otherwise as are necessary to permit him to
retain the same percentage of beneficial ownership interest in ISI as held
on December 16, 1996.
b. The options granted are to have an exercise price equal to
the fair market value of ISI's shares on the date such terms are approved
by the Board. The details of this provision are further outlined in the
resolutions to the minutes of the Board of Directors meeting held on
December 16, 1996.
c. Employee will be paid a quarterly bonus based on the
financial performance of the Company. This bonus will be paid at the rate
of 5% of the Company's accumulative pre-tax profit. An annual bonus may
be paid to the Employee, based on the performance of the Company and at
the discretion of the Board of Directors.
4. EXPENSES. ISI shall reimburse Employee for all business
expenses incurred in pursuit of the business of ISI, upon presentation by
the Employee from time to time of an itemized account of such
expenditures.
5. VACATION. Employee shall be entitled each year to a vacation of
six weeks, which shall be taken on a pre-scheduled basis.
6. FRINGE BENEFITS. ISI shall pay for the Employee in the regular
fringe benefit plan available to ISI employees, including medical
disability, and life insurance. Benefits incurred during the previous
term of the previous Employment Agreement will not be reduced by this
Agreement.
7. EXTENT OF SERVICES. Employee shall devote his time, attention
and energies to managing ISI and shall not during the term of this
Agreement be engaged in any other business activity whether or not such
business activity is pursued for gain, profit, or other pecuniary
advantage; but this shall not be construed as preventing the Employee from
investing his assets in such form or manner as will not require full time
service on the part of the Employee in the operation of the affairs of the
companies in which investments are made.
8. DEATH DURING EMPLOYMENT. If the Employee dies during the term
of this employment, ISI shall pay to the estate of the Employee the
compensation which would otherwise be payable to the Employee for the
three months after the date on which his death occurs. In addition, all
bonuses earned prior to Employee's date of death shall be paid to
Employee's estate.
9. TERMINATION. ISI may terminate this Agreement at any time:
a. Because of Employee's fraud, misappropriation, embezzlement
or similar act,
b. If Employee shall have breached any provision of this
Agreement, without having cured said default within thirty days after
receipt of written notice thereof.
c. Should ISI terminate his employment for any reason other
than cause, the Employee shall receive immediate vesting of any and all
outstanding options and warrants, and subsequent to the term of this
Agreement, a cash severance package equal to one year's cash compensation
(including bonus). Also, should termination occur within two years of a
change in control of ISI, such termination will be deemed to be not for
cause, regardless of the reasons for termination.
10. NOTICES. Any notice required or permitted to this Agreement
must be in writing and delivered by certified US mail to the parties of
this Agreement.
11. WAIVER OF BREACH. The waiver by ISI of a breach of any
provision of this Agreement by the Employee shall not operate or be
construed as a waiver of any subsequent breach by the Employee.
12. ASSIGNMENT. The rights and obligations of ISI under this
Agreement shall inure to the benefit of and shall be binding upon the
successors and assigns of ISI. The rights and obligations of the Employee
under its Agreement shall inure to the benefit of and shall be binding
upon the Employee's heirs, successors and assigns, except that Employee's
obligation to perform such further services and rights to receive payment
therefore are expressly declared to be non-assignable and non-
transferable.
13. ENTIRE AGREEMENT. This instrument contains the entire Agreement
of the parties. It may not be changed orally but only by an agreement in
writing signed by the party against whom enforcement of any waiver,
change, modification, extension or discharge is sought.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
day and year first above written.
Accepted: /s/ Xxxxx X. XxXxxxx ISI:
/s/ Xxxxx X. XxXxxxx
President
Ratified by the Compensation Committee:
/s/ Xxxxxx Xxxxxxx XX Dated: Nov. 1, 1997
/s/ Xxxxxxx X. Xxxxx
