RESIGNATION AGREEMENT
Exhibit
10.34
THIS
RESIGNATION AGREEMENT
(this
“Agreement”) is made this 17th day of August, 2008 by and between XXXX XXXXXXX,
residing at __________________, New York, New York (“Xxxx”) and MAGNITUDE
INFORMATION SYSTEMS, INC., a Delaware corporation, having its principal offices
at 0000 Xxxxx 00, Xxxxxxxxxx, Xxx Xxxxxx 00000 (the “Company”).
BACKGROUND:
WHEREAS,
Xxxx has an Employment Agreement, dated August 16, 2007, with the Company (the
“Employment Agreement’); and
WHEREAS,
Xxxx was and is a party (together with the Company, Lin Dai, Xxxxxxx Xxxxxx
and
Kiwibox Media, Inc.) to a certain Agreement and Plan of Reorganization, dated
February 19, 2007 and the six (6) amendments thereto (collectively, the
“Acquisition Agreement”); and
WHEREAS,
Xxxx has decided to pursue other opportunities and has negotiated with the
Company to terminate the Employment Agreement and the Acquisition Agreement
as
it or they relate to Xxxx and the Company pursuant to the terms and provisions
of this Agreement.
NOW,
THEREFORE, based upon the mutual premises and promises made by the parties
to
each
other,
and for other good and valuable consideration, the sufficiency of which the
parties hereby
acknowledge,
it is agreed as follows:
1. Termination
of Employment Agreement.
Xxxx and
the Company agree to terminate the Employment Agreement, including without
limitation, any and all rights, entitlements, benefits, salaries, bonuses,
duties, obligations, Company securities issuable thereunder as well as any
claims that have arisen or may arise thereunder against or for the benefit
of
either Xxxx or the Company; Xxxx and the Company, therefore, mutually agree
that
the Employment Agreement shall be deemed canceled and terminated and of no
longer any legal force or effect as of the date of this Agreement.
2. Termination
of Acquisition Agreement.
Xxxx and
the Company agree to terminate the Acquisition Agreement as it relates to each
of Xxxx and the Company, including without limitation, any and all rights,
entitlements, benefits, salaries, bonuses, duties, obligations, Company
securities issuable thereunder as well as any claims that have arisen or may
arise thereunder against or for the benefit of either Xxxx or the Company;
Xxxx
and the Company, therefore, mutually agree that the Acquisition Agreement shall
be deemed canceled and terminated and of no longer any legal force or effect
as
of the date of this Agreement.
3. Purchase
of Ivan’s Company Stock.
As
partial consideration for Ivan’s agreement to terminate the Employment Agreement
and the Acquisition Agreement, the Company shall cause the purchase of Ivan’s
securities, identified below, simultaneous with the execution and delivery
of
this Agreement; the Company shall cause a payment in the amount of Two Hundred
Seventy-Five Thousand ($275,000) Dollars to be made to Xxxx, either by delivery
of a bank draft or certified check or by wire transfer into Ivan’s bank account
on the date this Agreement is executed and delivered; in consideration of this
payment, Xxxx shall deliver to the Company certain of his Company shares, to
wit, Certificate No. 2571, representing 9,638,213 Company common shares,
Certificate No. CPG-02, representing 11,640 shares of the Company’s Series G
Preferred Stock, certain “reset” Company shares, Certificate No. P2681,
representing 6,590,231 Company common shares, and certain “penalty” Company
shares, Certificate No. P2680, representing 3,520,000 Company Common Shares,
Company common stock purchase option for 7,500,000 shares and Performance Common
Stock Purchase Option for 3,000,000 shares, together with duly executed stock
powers.
4. Mutual
Releases. Except
for the promises made in this Agreement, the Company and Xxxx hereby mutually
release each other forever, their respective heirs, executors, administrators,
directors, officers, employees and agents, from and against any claims of any
nature whatsoever, that may have arose or that may arise out of or in connection
with (i) any document, including without limitation the Employment Agreement
and
the Acquisition Agreement, as well as (ii) any set of facts or circumstances
that may have arose or that may arise out of any facts or circumstances existing
prior to the execution and delivery of this Agreement.
5.1 Confidential
Information.
Xxxx
shall
not, in any manner, for any reasons, either directly or indirectly, divulge
or
communicate to any person, firm or corporation, any confidential information
concerning any matters not generally known in the website industry (the "Website
Industry") or otherwise made public by the Company which affects or relates
to
the Company’s business, finances, marketing and/or operations, research,
development, inventions, products, designs, plans, procedures, or other data
(collectively, "Confidential Information") except in the ordinary course of
business or as required by applicable law. For
all
purposes of this Article 5.1, Confidential Information shall include the
methodologies developed by Xxxx, alone or with others, during Ivan’s association
and employment with the Kiwibox business, including (i) the “Collaborative
Editorial and Content Management System”, (ii) the Multi-Level Permission/Jobs
based administrative tools; (iii) the Points and Prizes Loyalty Rewards and
Fulfillment Systems, and; (iv) any portion of the Kiwibox code and database.
Without
regard to whether any item of Confidential Information is deemed or considered
confidential, material, or important, the parties hereto stipulate that as
between them, to the extent such item is not generally known in the Website
Industry, such item is important, material, and confidential and affects the
successful conduct of Employer's business and goodwill, and that any breach
of
the terms of this Section 5.1 shall be a material and incurable breach of this
Agreement. Confidential Information shall not include: information in the public
domain other than because of a breach of this Agreement.
5.2 Inventions
and Intellectual Property.
All
ideas, inventions, and other developments or improvements conceived or reduced
to practice by Xxxx, alone or with others, prior to the date of this Agreement,
whether or not during working hours, that were within the scope of the business
of the Company or that relate to or result from any of Company's work or
projects or the services provided by Xxxx to the Company pursuant to the
Employment Agreement, shall be the exclusive property of the Company.
6.1 No
Competitive Activities.
During
the two (2) year period following the date of this Agreement, Xxxx shall not
engage in any activates that are competitive with the business of the Company,
including without limitation, (a)engaging directly or indirectly in any social
networking website or online website magazine, with a teen-targeted demographic;
(b) soliciting or taking away any executive, employee, agent, representative,
contractor, supplier, vendor, customer, franchisee, lender or investor of the
Company, or attempting to so solicit or take away; (c) interfering with any
contractual or other relationship between the Company and any executive,
employee, agent, representative, contractor, supplier, vendor, customer,
franchisee, lender or investor; or (d) using, for the benefit of any person
or
entity other than the Company any Confidential Information of the Company.
The
items
and projects set forth in Exhibit A of Ivan’s Employment Agreement are expressly
and specifically excluded from this limitation.
6.2 No
Negative Statements. During
the two-year period following the date of this Agreement, neither Xxxx nor
the
Company shall make or permit the making of any negative statement of any kind
concerning the Company or its affiliates, or their respective directors,
officers or agents or Xxxx.
7.
Survival
of Promises.
Except
as otherwise provided, the Company and Xxxx agree that their respective
promises, as the case may be, made in provisions of Articles 4, 5.1, 5.2, 6.1,
6.2, 7 and 8 shall survive the execution and delivery of this Agreement and
continue for a period of two (2) years following the date hereof, and shall
remain in full force and effect during such period.
8.
Injunctive
Relief.
Xxxx
acknowledges and agrees that his promises made in Articles 4, 5.1, 5.2, 6.1,
6.2, 7, and 8 with respect to confidentiality, property ownership,
non-competition and non-solicitation, (I) relate to special, unique and
extraordinary matters and that a violation of any of the terms of such covenants
and obligations will cause the Company irreparable injury for which adequate
remedies are not available at law, and; (ii) represent a material part of the
consideration the Company is relying upon to execute, deliver and perform this
Agreement. Therefore, Xxxx agrees that if he breaches one or more of his
promises that the Company shall be entitled to apply for an injunction,
restraining order or such other equitable relief as a court of competent
jurisdiction as limited by Article 13 may deem necessary or appropriate to
restrain Xxxx from committing any violation of his promises referred to in
this
Article 8. Xxxx shall have the right to appeal from such injunction or order
and
to seek reconsideration. These injunctive remedies are cumulative and in
addition to any other rights and remedies the Company may have at law or in
equity.
9. Term.
The term
of this Agreement shall commence upon the date hereof and terminate upon the
second anniversary date of this Agreement.
10. Xxxx
Acknowledgments.
Xxxx
hereby acknowledges that he is selling the Company securities for the
consideration as identified herein; that he is fully familiar with all of the
Company’s published annual, quarterly and current reports filed with the U.S.
Securities and Exchange Commission (the “SEC”). Xxxx acknowledges that the
Company has made no representation as to the value, if any, of its securities
or
of Ivan’s securities that he is selling pursuant to the terms of this Agreement,
and; that he has negotiated the consideration to be paid to him in an arm’s
length transaction; that he has had the advice of independent counsel in
connection with the review and negotiation of the terms of this Agreement,
and;
that he hereby waives any and all applicable notice and waiting periods that
may
be required under state or federal law covering employee rights and/or employer
obligations.
11. General
Provisions.
No
failure by either party to declare a default based on any breach by the other
party of any provisions of this Agreement, nor failure of such party to act
quickly with regard thereto, shall be considered to be a waiver of any such
breach, or of any future breach.
12. Modification.
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 parties to be charged therewith.
13. Submission
to Jurisdiction; Consent to Service of Process. This
Agreement shall be governed in all respects, by the laws of the State of New
York, including validity, interpretation and effect, without regard to
principles of conflicts of law. The parties hereto irrevocably and
unconditionally consent to submit to the exclusive jurisdiction of the state
and
federal courts in the State of New Jersey or in the State of New York for any
lawsuits, actions or other proceedings arising out of or related to this
Agreement and agree not to commence any lawsuit, action or other proceeding
except in such courts. The parties hereto further agree that service of process,
summons, notice or document by mail to their addresses set forth above shall
be
effective service of process for any lawsuit, action or other proceeding brought
against them in any such court. The parties hereto irrevocably and
unconditionally waive any objection to the laying of venue of any lawsuit,
action or other proceeding arising out of or related to this Agreement in such
courts, and hereby further irrevocably and unconditionally waive and agree
not
to plead or claim in any such court that any such lawsuit, action or proceeding
brought in any such court has been brought in an inconvenient
forum.
14.
Entire
Agreement.
This
Agreement embodies the whole agreement between the parties hereto regarding
the
subject matter hereof and there are no inducements, promises, terms, conditions,
or obligations made or entered into by Employer or Executive other than
contained herein.
15. Severability.
In the
event a court of competent jurisdiction determines that a term or provisions
contained in this Agreement is overly broad in scope, time geographical location
or otherwise, the parties hereto authorize such Court to modify and reduce
any
such term or provision deemed overly broad in scope, time, geographic location
or otherwise so that it complies with then applicable law.
16. Headings.
The
headings contained herein are for the convenience of reference and are not
to be
used in interpreting this Agreement.
17. Independent
Legal Advice.
Xxxx
hereby acknowledges that he has obtained legal advice concerning this Agreement.
18.
No
Assignment.
No party
may pledge or encumber its respective interests in this Agreement nor assign
any
of its rights or duties under this Agreement without the prior written consent
of the other party.
IN
WITNESS
WHEREOF the parties have executed this Agreement as of the day and year first
above written.
| MAGNITUDE INFORMATION SYSTEMS, INC. | ||
| |
|
|
| By: | /s/ Xxxxxx Xxxxx | |
|
Xxxxxx Xxxxx, President and CEO |
||
| Title | ||
| /s/ Xxxx Xxxxxxx | ||
|
Xxxx Xxxxxxx, Individual |
||
