Asset Purchase Agreement
This Asset Purchase Agreement (the "Agreement") is made and
effective February 20, 2000, by and between XxxxxXxxxx.xxx, Inc., a Utah
Corporation ("Buyer") and Xxxxx Xxxxx ("Seller").
Seller operates a community web site specific to the online crafts
community under the name Xxxxxxx.xxx (the "Business").
Seller desires to sell to Buyer, and Buyer desires to purchase
from Seller, certain assets of Seller used in the Business, subject to
the terms of this Agreement.
NOW, THEREFORE, the parties agree as follows:
1. Transfer of Assets. At the Closing, subject to the terms of this
Agreement, Seller shall sell, assign, transfer, convey and deliver to
Buyer, and Buyer shall purchase from Seller, free and clear of all
liens, encumbrances, claims, clouds, charges, equities or imperfections
of any nature, all software, databases, contract rights, customer lists,
trademarks, trade names, intellectual property, goodwill, materials,
supplies, telephone numbers, business records, and other assets owned by
Seller and used or useful in the Business and related operations. The
assets and properties to be transferred by Seller to Buyer shall
include, without limitation those identified in Exhibit A attached
hereto.
2. Conveyance and Transfer Documents. Seller agrees to deliver to
Buyer at the Closing such certificates, bills of sale, documents of
title and other instruments of conveyance and transfer, in form and
content satisfactory to Buyer, as shall be effective to vest in Buyer
good and marketable title in and to any property to be sold, assigned,
transferred, conveyed and delivered hereunder.
3. Payment of Purchase Price. In exchange for full payment for all of
the items purchased from Seller, Buyer shall issue Seller 25,000 shares
of its common stock. Such issued shares shall be "restricted securities"
and shall be imprinted with the following legend or a reasonable
facsimile thereof on the front and reverse sides thereof:
"The shares of stock represented by this certificate have not been
registered under the Securities Act of 1933, as amended, and may not be
sold or otherwise transferred unless compliance with the registration
provisions of such Act has been made or unless availability of an
exemption from such registration provisions has been established, or
unless sold pursuant to Rule 144 under the Act."
4. Nonassumption of Liabilities. Except as otherwise agreed expressly
in writing, Buyer does not and shall not assume or agree to pay any of
Seller's or, where applicable, any shareholder's, partner's, or
member's, liabilities or obligations of any nature or kind. Seller and,
where applicable, any shareholder, partner, or member, shall each remain
responsible for their respective debts and obligations.
5. Further Assurances. From time to time after the date of this
Agreement, Seller shall give to Buyer, and to Buyer's representatives,
auditors and counsel, full access during normal business hours to all of
the properties, books, records, tax returns, contracts, licenses,
franchises and all of the documents of Seller relating to the Business
and shall furnish to Buyer all information with respect to the Business,
as Buyer may from time to time reasonably request. Promptly following
execution of this Agreement, Seller shall use Seller's best efforts to
obtain all consents (if any, including, without limitation, consents of
any government or governmental agency) necessary to effect the sale,
assignment, transfer, conveyance and delivery contemplated by Section 1
hereof. From time to time after the Closing, at Buyer's request and
without further consideration, Seller agrees to execute and deliver at
Seller's expense such other instruments of conveyance and transfer and
take such other action as Buyer reasonably may require more effectively
to sell, assign, transfer, convey, deliver and vest in Buyer, and to put
Buyer in possession of, any property to be sold, assigned, transferred,
conveyed and delivered hereunder.
6. Closing.
A. The issuance of shares, delivery of documents and completion of
other items related to the transfer of the Business and the assets
purchased by Buyer (the "Closing") shall be held on February 20, 2000,
at 5:00 p.m., at Dallas, TX, or on such other date, and at such other
time and place, as mutually agreed upon by the parties in writing.
B. At the Closing:
(i) Seller shall execute and deliver to Buyer the
instruments of conveyance and transfer called for in Section 2 hereof;
(ii) Buyer shall deliver to Seller a Board resolution
instructing the Buyer's transfer agent to issue the stock called for in
Section 3 above.
C. In the event that the Closing hereunder shall not be
consummated by February 20, 2000 for any reason other than some act,
omission or material breach by Buyer, this Agreement shall, at the sole
option of Buyer, terminate.
7. Representations and Warranties of Seller. Seller represents and
warrants to and covenants with Buyer, and Buyer's successors and assigns
(which representations, warranties and covenants shall survive the
Closing), as follows:
A. Seller has full power and authority to execute and deliver the
Agreement and to consummate the transactions contemplated hereby.
B. This Agreement and Seller's performance of the obligations
herein do not constitute the breach or violation of any agreement,
covenant, obligation or promise to which Seller is legally bound.
C. Seller's execution, delivery and performance of this Agreement
will not constitute the breach or violation of any agreement,
obligation, promise, covenant or court order with respect to any spousal
maintenance or child support obligation and that Seller's spouse, if
any, does not own any part of the Business and no consent or waiver by
any such spouse is required to complete Seller's obligations herein.
D. Except as otherwise disclosed by Seller in writing, as of the
date of this Agreement, the assets and properties of Seller are not, and
as of the Closing they will not be, subject to any liens, encumbrances,
claims, clouds, charges, equities or imperfections of any nature.
E. Neither the execution or delivery by Seller of this Agreement
or the transactions contemplated hereby will: (i) result in the creation
of any lien, security interest, or encumbrance upon any of the assets of
Seller; (ii) violate any order, writ, injunction, decree, judgment, law,
rule, regulation or ruling of any court or governmental authority
applicable to Seller or any of its properties; or (iii) require any
consent, approval or authorization of, or declaration, filing or
registration with, any governmental or regulatory authority.
F. Seller, and where applicable any shareholder, officer,
director, member or partner, are in violation of, or under investigation
with respect to, or have been charged with or given notice of, any
violation of any applicable law, statute, order, rule, regulation,
policy or guideline promulgated or judgment entered, by any federal,
state or local court or governmental authority relating to or affecting
the Business, Seller or any of Seller's assets.
G. As of the Closing Date there has not been, any materially
adverse change in the financial condition, assets, liabilities, business
or property of Seller, or with respect to its employees or customers,
and Seller has no knowledge of any fact or contemplated event which may,
in the future, cause any such materially adverse change. As of the date
of Closing, the business of the Seller has been, and will be, conducted
only in the ordinary course.
H. Copies of all instruments, agreements and other documents which
have been delivered or may be delivered to Buyer by Seller pursuant to
or in connection with this Agreement are and will be complete and
correct as of the date hereof and as of the Closing. Exhibits B and C,
attached hereto and made a part hereof, are lists of all contracts,
leases, licenses and other agreements relating to the Business. Seller
is not in default and has not received any notice of default under any
such contract, lease, license or other agreement or under any other
obligation relating to the Business.
I. As of the date hereof there is, and on the Closing Date there
will be, no litigation at law or in equity, no proceeding before any
commission or other administrative or regulatory authority, and no
dispute, claim or controversy (including, without limitation, labor
union strikes, elections, arbitrations, grievances, complaints, or
administrative actions) pending, or to the knowledge of Seller
threatened, against or affecting the business or property of Seller or
it right to carry on it business and enter into and consummate the
transactions contemplated by this Agreement.
J. There is no unfair labor practice complaint against Seller
pending before the National Labor Relations Board. There is no labor
strike dispute, slowdown or stoppage, or any union organizing campaign,
pending, or to the best of the knowledge of Seller, threatened against
or involving Seller. No labor agreements have been filed with Seller
which has had, or may have, a materially adverse effect on Seller's
business. No collective bargaining agreement is currently being
negotiated with Seller.
K. Seller has not employed any broker or finder or incurred any
liability for any brokerage fees, commissions, finder fees or similar
fees or expenses, and no broker or finder has acted directly or
indirectly for Seller in connection with this Agreement or the
transactions contemplated hereby.
L. On the date hereof Seller has, and on the Closing Seller shall
have, duly prepared and timely filed all local, state and federal tax
returns (including, without limitation, those which relate to FICA,
withholding and other payroll taxes) required to be filed by such dates,
and paid all taxes, penalties and interest with respect thereto. To the
extent that any tax liabilities have accrued but not become payable, the
full amounts thereof have been reflected as liabilities or reserved
against on the Balance Sheet. After the Closing, Seller shall duly
prepare and timely file any and all local, state and federal tax returns
which pertain, in whole or in part, to the period on or before the
Closing, and pay all taxes, penalties and interest with respect thereto.
M. On the date hereof, the properties and assets to be transferred
under this Agreement are, and on the Closing they will be, in good
condition and repair.
N. Seller shall permit Buyer and its representatives at all
reasonable times during business hours and without interfering with the
normal conduct of the business of Seller, to examine and have full
access to all of the properties, books and records of Seller and to copy
such books and records (at Buyer's expense).
8. Representations and Warranties of Buyer. Buyer represents and
warrants to and covenants with Seller (which representations and
warranties shall survive the Closing) as follows:
A. Buyer is a Corporation duly organized, validly existing and in
good standing under the laws of the State of Utah.
B. Buyer has full power and authority to execute and deliver the
Agreement and to consummate the transactions contemplated hereby. The
execution, delivery and consummation of this Agreement have been duly
authorized and approved by such directors of Buyer as required by, and
in accordance with, applicable laws and the instruments, agreements and
documents controlling Buyer's governance.
C. As of the date hereof there is, and as of the Closing there
will not be litigation at law or in equity, no proceeding before any
commission or other administrative or regulatory authority, and no
dispute, claim or controversy pending, or to the knowledge of Buyer
threatened, against or affecting the right of Buyer to enter into and
consummate the transactions contemplated by this Agreement.
D. Buyer has not employed any broker or finder or incurred any
liability for any brokerage fees, commissions, finder fees or similar
fees or expenses in connection with the transactions contemplated by
this Agreement, and no broker or finder has acted on Buyer's behalf.
9. Indemnification.
A. Seller indemnifies and holds harmless Buyer against any loss,
damage or expense (including, without limitation, taxes, penalties,
interest and reasonable attorney's fees) asserted against or suffered by
Buyer arising out of or resulting from (i) any breach of this Agreement
by Seller; (ii) any inaccuracy in the representations, warranties, and
covenants made by Seller in this Agreement, or in any certificate,
schedule, exhibit or written instrument delivered or to be delivered
under this Agreement; and (iii) any liability, obligation, demand,
claim, action, or judgment, known or unknown, which may already have
arisen or which may hereafter arise, by reason of or in connection with
the operation of Seller's business prior to the Closing.
B. (i) Buyer shall promptly notify Seller of any claim or demand
which Buyer determines has given or could give rise to a right of
indemnification under this Agreement. Unless Seller give Buyer written
notice that either contests Buyer's right to indemnification for a claim
or demand within thirty (30) days of the date Buyer notifies them of
such a claim or demand, Seller shall be deemed to have acknowledged
Buyer's right to indemnification for such claim or demand pursuant to
the provisions of this Agreement.
(ii) If any claim or demand relates to a claim or demand
asserted by a third party against Buyer, Seller shall have the duty, at
Seller's expense, to defend any such claim or demand. Buyer shall make
available to Seller and Seller's representatives all records and other
materials reasonably required by them for their use in contesting any
such claim or demand. Buyer shall have the right, but not the
obligation, to employ separate counsel, and to participate with Seller
in the defense of any such claim or demand, but the fees and expenses of
such separate counsel shall be paid by Buyer. In not event shall Buyer
be obligated to defend any such claim or demand.
10. Conditions Precedent to the Obligations of Buyer. The obligations
of Buyer under this Agreement are subject to the following conditions
precedent:
A. The representations, warranties and covenants made by Seller
herein to Buyer shall be true and correct in all material respects on
and as of the Closing Date with the same effect as if such
representations, warranties and covenants had been made on and as of
date of the Closing, and Seller shall have performed and complied with
all agreements, covenants and conditions on their part required to be
performed and complied with on or prior to the Closing.
B. The assets to be purchased by Buyer and the Business shall not
have been adversely affected in any material way (whether or not covered
by insurance) as a result of any fire, casualty, act of God or other
force majeure or any labor dispute or disturbances.
11. Conditions Precedent to the Obligations of Seller. The
obligations of Seller shall be subject to the condition precedent that
all warranties, representations, and covenants made by Buyer to Seller
in this Agreement shall be true and correct in all material respects on
and as of the Closing with the same effect as if such warranties,
representations, and covenants had been made on and as of the date of
the Closing, and Buyer shall have performed or complied with all
agreements, covenants and conditions on its part required to be
performed or complied with on or prior to the Closing.
12. Covenants of Seller. Seller covenants with Buyer as follows:
During the two year period from and after the Closing, Seller
shall not directly or indirectly, or as a partner, shareholder,
employee, manager or otherwise, own, manage, operate, control, be
employed by, participate in, or otherwise be connected with any other
business the same as or similar to the Business. In the event any of
the provisions of this Section shall be determined to be invalid by
reason of their scope or duration, this Section shall be deemed modified
to such extent as required to cure the invalidity. In the event of a
breach, or a threatened breach, of this covenant, Buyer shall be
entitled to obtain an injunction restraining the commencement or
continuance or the breach, as well as to any other legal or equitable
remedies permitted by law.
13. Consulting Agreement. At the Closing, Buyer and Seller (or a
principal of Seller) shall enter into a Consulting Agreement in the form
and with the content of the Consulting Agreement attach as Exhibit B.
14. Notices.
Any notice under this Agreement shall be effectively given upon deposit
in the United States mail, postage prepaid, or by recognized overnight
delivery service, and addressed as follows (or at such change of address
given by one party to the other in writing after the date hereof):
If to Buyer: XxxxxXxxxx.xxx, Inc., 000 Xxxxxx Xxxx., Xxxxx Xxx
Xxx, XX 00000
If to Seller: Xxxxx Xxxxx, 0000 Xxxxx Xxxxx Xxxx, Xxxxxxxxxxx, XX
00000
15. Final Agreement.
This Agreement represents the full agreement between the parties and
supersedes any and all prior negotiations and understandings between
them. This Agreement may not be modified or amended except by a written
instrument executed by all of the parties.
16. Governing Law.
This Agreement shall be governed by and construed according to the laws
of the State of Utah.
17. Force Majeure.
Nonperformance of either party shall be excused to the extent that
performance is rendered impossible by strike, fire, flood, governmental
acts, orders or restrictions, or any other reason where failure to
perform is beyond the control and not caused by the negligence of the
non-conforming party.
18. No Assignment.
The parties agree that neither party may assign or transfer any rights
and obligations under this Agreement, directly or indirectly except upon
the prior written consent of the other party. Subject to the foregoing,
this Agreement shall be binding upon and inure to the benefit of the
parties hereto, their successors and assigns.
19. Severability.
If any provision of this Agreement is held to be invalid by a court of
competent jurisdiction, then the remaining provisions shall nevertheless
remain in full force and effect.
20. Counterparts.
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original.
21. Headings.
Headings used in this Agreement are provided for convenience only and
shall not be used to construe meaning or intent.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on the day and year first above written.
XxxxxXxxxx.xxx, Inc.
By: /s/Xxxxx X. Xxxxxx /s/Xxxxx Xxxxx
Xxxxx X. Xxxxxx Xxxxx Xxxxx
Chief Executive Officer
EXHIBIT A
Seller's Assets
All software relating to the Business, including but not limited to
operating and application software.
All domain names registered to the Business, including but not limited
to Xxxxxxx.xxx.
All e-mail lists and registered member information.
Complete access including passwords to the Business web site.
Any information that is stored in the databases of the Business.
Interwest Transfer Co.
0000 Xxxx Xxxxxx-Xxxxxxxx Xx.
P. O. Xxx 00000
Xxxx Xxxx Xxxx, Xxxx 00000
Xxxxxxxxxx.xxx, Inc.
000 Xxxxxx Xxxx.
Xxxxx Xxx Xxx, Xxxxxxxxxx 00000
Re: Sale of assets of Xxxxxxx.xxx in exchange for
shares of Xxxxxxxxxx.xxx, Inc., a Utah
corporation ("Craftclick or "the Company")
Dear Ladies and Gentlemen:
Pursuant to that certain Asset Purchase Agreement (the
"Agreement") between the undersigned I acknowledge that I have approved
this sale and exchange; that I am aware of all of the terms and
conditions of the Agreement; that I have received and personally
reviewed a copy of any and all material documents regarding the Company,
including, but not limited to Articles of Incorporation, Bylaws, minutes
of meetings of directors and stockholders, financial statements and the
Company's Annual and Quarterly and Current Reports filed with the
Securities and Exchange Commission for the past twelve months which can
be reviewed in the Xxxxx Archives at xxx.xxx.xxx. I represent and
warrant that no director or officer of the Company or any associate of
either has solicited this exchange; that I am an "accredited investor"
as that term is known under the Rules and Regulations of the Securities
and Exchange Commission; and/or, I represent and warrant that I have
sufficient knowledge and experience to understand the nature of the
exchange and am fully capable of bearing the economic risk of the loss
of my entire cost basis. I hereby compromise and waive any claims I
have or may have against TCS under any federal or state securities laws,
rules or regulations or otherwise, or for any other reason whatsoever.
I understand that you have and will make books and records
of your Company available to me for my inspection in connection with the
contemplated exchange of my shares, and that I have been encouraged to
review the information and ask any questions I may have concerning the
information of any director or officer of the Company or of the legal
and accounting firms for the Company. I understand that the accounting
firm for Craftclick is Xxxxxxx, XxXxxxxxxx & Assoc., 0000 Xxxxx 000
Xxxx, #000, Xxxx Xxxx Xxxx, Xxxx 00000; Telephone: (000) 000-0000; and
that legal counsel for Craftclick is Xxxxxxx X. Xxxxxxxxxx, Esq., 000
Xxxx 0xx Xxxxx, Xxxxx 000, Xxxx Xxxx Xxxx, Xxxx 00000, Telephone #801-
000-0000.
I also understand that I must bear the economic risk of
ownership of any of the Craftclick shares for a long period of time, the
minimum of which will be one (1) year, as these shares are
"unregistered" shares and may not be sold unless any subsequent offer or
sale is registered with the United States Securities and Exchange
Commission or otherwise exempt from the registration requirements of the
Securities Act of 1933, as amended (the "Act"), or other applicable
laws, rules and regulations.
I intend that you rely on all of my representations made
herein and those in the personal questionnaire (if applicable) I
provided for use by Craftclick as they are made to induce you to issue
me the shares of Craftclick under the Agreement, and I further represent
(of my personal knowledge or by virtue of my reliance on one or more
personal representatives), and agree as follows, to-wit:
1. That the shares being acquired are being received for
investment purposes and not with a view toward further distribution;
2. That I have a full and complete understanding of the
phrase "for investment purposes and not with a view toward further
distribution";
3. That I understand the meaning of "unregistered shares"
and know that they are not freely tradeable;
4. That any stock certificate issued by you to me in
connection with the shares being acquired shall be imprinted with a
legend restricting the sale, assignment, hypothecation or other
disposition unless it can be made in accordance with applicable laws,
rules and regulations;
5. I agree that the stock transfer records of your
Company shall reflect that I have requested the Company not to effect
any transfer of any stock certificate representing any of the shares
being acquired unless I shall first have obtained an opinion of legal
counsel to the effect that the shares may be sold in accordance with
applicable laws, rules and regulations, and I understand that any
opinion must be from legal counsel satisfactory to the Company and,
regardless of any opinion, I understand that the exemption covered by
any opinion must in fact be applicable to the shares;
6. That I shall not sell, offer to sell, transfer,
assign, hypothecate or make any other disposition of any interest in the
shares being acquired except as may be pursuant to any applicable laws,
rules and regulations;
7. I fully understand that my shares which are being
exchanged for shares of the Company are "risk capital," and I am fully
capable of bearing the economic risks attendant to this investment,
without qualification; and
8. I also understand that without approval of counsel for
Craftclick, all shares of Craftclick to be issued and delivered to me
shall be represented by one stock certificate only and which such stock
certificate shall be imprinted with the following legend or a reasonable
facsimile thereof on the front and reverse sides thereof:
The shares of stock represented by this
certificate have not been registered under the
Securities Act of 1933, as amended, and may not
be sold or otherwise transferred unless
compliance with the registration provisions of
such Act has been made or unless availability of
an exemption from such registration provisions
has been established, or unless sold pursuant to
Rule 144 under the Act.
Any request for more than one stock certificate must be
accompanied by a letter signed by the requesting stockholder setting
forth all relevant facts relating to the request. Craftclick will
attempt to accommodate any stockholders' request where Craftclick views
the request is made for valid business or personal reasons so long as in
the sole discretion of Craftclick, the granting of the request will not
facilitate a "public" distribution of unregistered shares of common
voting stock of Craftclick.
You are requested and instructed to issue a stock
certificate as follows, to-wit:
Xxxxx Xxxxx 12,500
(Name(s) and Number of Shares)
0000 Xxxxx Xxxxx Xx.
(Xxxxxxx)
Xxxxxxxxxx, XX 00000
(City, State and Zip Code)
If joint tenancy with full rights of
survivorship is desired, put the initials JTRS
after your names.
Dated this 20th day of February, 2000.
Very truly yours,
/s/Xxxxx Xxxxx
You are requested and instructed to issue a stock
certificate as follows, to-wit:
Xxxx Xxxxxxx 12,500
(Name(s) and Number of Shares)
00000 Xxxxxxxxxx Xxxx
(Xxxxxxx)
Xxxxxx, Xxxxx 00000
(City, State and Zip Code)
If joint tenancy with full rights of
survivorship is desired, put the initials JTRS
after your names.
Dated this 20th day of February, 2000.
Very truly yours,
/s/Xxxx Xxxxxxx
EMPLOYMENT AGREEMENT
This Employee Employment Agreement ("Agreement") is made and effective this
16th day of February, 2000, by and between XxxxxXxxxx.xxx, Inc. ("CraftClick")
and Xxxxx Xxxxx ("Employee").
NOW, THEREFORE, the parties hereto agree as follows:
1. Employment.
CraftClick hereby agrees to initially employ Employee as Web Site Manger, Arts
& Craft Expert, and Content Advisor for its Xxxxxxx.xxx business located in
Midlothian, TX, and Employee hereby accepts such employment in accordance with
the terms of this Agreement and the terms of employment applicable to regular
employees of CraftClick. In the event of any conflict or ambiguity between
the terms of this Agreement and terms of employment applicable to regular
employees, the terms of this Agreement shall control. Appointment of Employee
to another position, regardless of whether such position is inferior to
Employee's initial position, shall not be a breach of this Agreement.
2. Duties of Employee.
The duties of Employee shall include the performance of all of the duties
typical of the position held by Employee as described in the bylaws of
CraftClick and such other duties and projects as may be assigned by a superior
employee, officer of CraftClick, if any, or the board of directors of
CraftClick. Employee shall devote her entire productive time, ability and
attention to the business of CraftClick and shall perform all duties in a
professional, ethical and businesslike manner. Employee will not, during the
term of this Agreement, directly or indirectly engage in any other business,
either as an employee, employer, consultant, principal, officer, director,
advisor, or in any other capacity, either with or without compensation,
without the prior written consent of CraftClick.
3. Compensation.
A. Employee will be paid a base salary of $28,000 (Dollars Twenty Eight
Thousand) per year, payable in installments according to CraftClick's regular
payroll schedule. The base salary shall be reviewed thereafter in accordance
with CraftClick's compensation review policies prevailing at that time.
B. Upon the completion of the Company's stock option plan, Employee will
receive options to purchase Fifty Thousand (50,000) shares of the company's
common stock at a cost of One Dollar ($1.00) per share. Said shares to vest
quarterly over a four (4) year period in equal installments.
4. Benefits.
A. Holidays. Employee will be entitled to at least eight (8) paid holidays
each calendar year and two (2) personal days. CraftClick will notify Employee
on or about the beginning of each calendar year with respect to the holiday
schedule for the coming year. Personal holidays, if any, will be scheduled in
advance subject to requirements of CraftClick. Such holidays must be taken
during the calendar year and cannot be carried forward into the next year.
Employee is not entitled to any personal holidays during the first six months
of employment.
B. Vacation. Following the first six months of employment, Employee shall be
entitled to ten (10) paid vacation days each year to be accrued on a monthly
basis.
C. Sick Leave. Employee shall be entitled to sick leave and emergency leave
according to the regular policies and procedures of CraftClick. Sick leave
shall be accrued on a monthly basis. Additional sick leave or emergency leave
over and above paid leave provided by CraftClick, if any, shall be unpaid and
shall be granted at the discretion of the Employee's supervisor.
D. Expense Reimbursement. Employee shall be entitled to reimbursement for
all reasonable expenses, including travel and entertainment, incurred by
Employee in the performance of Employee's duties. Employee will maintain
records and written receipts as required by CraftClick policy and reasonably
requested by the board of directors to substantiate such expenses.
5. Term and Termination.
Sections 6, 7, 8, 9, 12, 15, and 16 shall survive any termination.
A. Probationary period: CraftClick subscribes to a policy of a 60 day
probationary period for all new employees. During this period, employee
performance will be continually evaluated. At CraftClick's discretion, this
agreement may be terminated at any time during the Probationary Period. In the
event of termination, Employee will only be eligible for payment of salaries
due up to the date of termination.
B. The Initial Term of this Agreement shall commence on February 16, 2000 and
it shall continue in effect for a period of One (1) year. Thereafter, the
Agreement shall be renewed upon the mutual agreement of Employee and Company.
This Agreement and Employee's employment may be terminated at Company's
discretion during the Initial Term, provided that Company shall provide two
(2) weeks written notice of termination, or payment in lieu thereof. In the
event of such termination, Employee shall not be entitled to any incentive
salary payment or any other compensation then in effect, prorated or
otherwise.
C. This Agreement may be terminated by Employee at Employee's discretion by
providing at least two (2) weeks prior written notice to CraftClick. In the
event of termination by Employee pursuant to this subsection, CraftClick may
immediately relieve Employee of all duties and immediately terminate this
Agreement, provided that CraftClick shall pay Employee at the then applicable
base salary rate to the termination date included in Employee's original
termination notice.
D. In the event that Employee is in breach of any material obligation owed
CraftClick in this Agreement, habitually neglects the duties to be performed
under this Agreement, engages in any conduct which is dishonest, damages the
reputation or standing of CraftClick, or is convicted of any criminal act or
engages in any act of moral turpitude, then CraftClick may terminate this
Agreement upon five (5) days notice to Employee. In event of termination of
the agreement pursuant to this subsection, Employee shall be paid only at the
then applicable base salary rate up to and including the date of termination.
Employee shall not be paid any incentive salary payments or other
compensation, prorated or otherwise.
E. In the event CraftClick is acquired, or is the non-surviving party in a
merger, or sells all or substantially all of its assets, this Agreement shall
not be terminated and CraftClick agrees to use its best efforts to ensure that
the transferee or surviving CraftClick is bound by the provisions of this
Agreement.
6. Rights to Innovations
The term "Innovations" shall mean all Program Code (including source code and
object code), documentation, reports, processes, procedures, improvements,
inventions, discoveries, concepts, know-how, ideas, designs, methods,
methodologies, developments, drawings, notes and similar or related material
and information, whether or not patentable or copyrightable, authored, made,
conceived or worked on by Employee, either solely or jointly with others,
which result from or relate to the employment of the Employee by the Company,
including, without limitation, any intellectual property right represented by
or embodied in the Innovations, Program Code, or Documentation, relating to or
potentially useful in the business of Company. All innovations conceived and
prepared under this Employment Agreement shall be deemed to be made in the
course of employment and shall belong solely and exclusively to the Company.
7. Non-Disclosure of Confidential Information
Employee agrees to keep confidential and not to use, copy or disclose,
directly or indirectly, to any third party any Confidential Information,
without the prior written consent by the President of the Company. Employee
shall use Confidential Information solely in connection with the performance
of the Services hereunder. Employee agrees that all Confidential Information
shall be and remain the property of Company.
8. Confidentiality
Employee acknowledges that she may through this Agreement come into contact
with or become aware of Confidential Information of the Comapny. Such
information may include and not be limited to, data, formulas, employee
information, financial information, strategic plans, patterns, compilations,
programs, devices, methods, techniques, or processes. Employee agrees to
maintain such information as strictly confidential and shall not disclose or
utilize such information in any manner whatsoever except in the normal course
of and during performance of this Agreement. These obligations of confidence
and on-use do not apply to information already available to the public at the
time of disclosure; to information which hereafter becomes generally available
to the public through no fault of the applicable party; to information which
is acquired from a third party having no obligation of confidence to the party
whose confidential information is at issue; or to information previously known
to the other party as evidence by its existing written records. The
obligation of confidence does not apply to information required to be
disclosed by law, provided, however, that the disclosing party shall notify
the other party promptly at any time it believes it is legally required to
disclose confidential information and shall not disclose such confidential
information until the other party has the opportunity to oppose such
disclosure or obtain an acceptable protective order.
9. Non-Compete
Employee shall NOT during the term of this Agreement for a period of one (1)
year after termination, directly or indirectly:
A. Solicit, induce, entice or attempt to entice any customer of Company to
terminate its business relationship with Company;
B. Solicit, induce, entice or attempt any other employee of Company to
terminate his/her employment with Company.
10. Notices.
Any notice required by this Agreement or given in connection with it, shall be
in writing and shall be given to the appropriate party by personal delivery or
by certified mail, postage prepaid, or recognized overnight delivery services;
If to CraftClick:
CraftClick
000 Xxxxxx Xxxx.
Xxxxx Xxx Xxx, XX 00000
If to Employee:
Xxxxx Xxxxx
0000 Xxxxx Xxxxx Xxxx
Xxxxxxxxxx, XX 00000
11. Final Agreement.
This Agreement terminates and supersedes all prior understandings or agreements
on the subject matter hereof. This Agreement may be modified only by a further
writing that is duly executed by both parties.
12. Governing Law.
This Agreement shall be construed and enforced in accordance with the laws of
the state of California.
13. Headings.
Headings used in this Agreement are provided for convenience only and shall not
be used to construe meaning or intent.
14. No Assignment.
Neither this Agreement nor any or interest in this Agreement may be assigned by
Employee without the prior express written approval of CraftClick, which may be
withheld by CraftClick at CraftClick's absolute discretion.
15. Severability.
If any term of this Agreement is held by a court of competent jurisdiction to be
invalid or unenforceable, then this Agreement, including all of the remaining
terms, will remain in full force and effect as if such invalid or unenforceable
term had never been included.
16. Arbitration.
The parties agree that they will use their best efforts to amicably resolve any
dispute arising out of or relating to this Agreement. Any controversy, claim or
dispute that cannot be so resolved shall be settled by final binding arbitration
in accordance with the rules of the American Arbitration Association and
judgment upon the award rendered by the arbitrator or arbitrators may be entered
in any court having jurisdiction thereof. Any such arbitration shall be
conducted in Los Angeles, California, or such other place as may be mutually
agreed upon by the parties. Within fifteen (15) days after the commencement of
the arbitration, each party shall select one person to act as arbitrator, and
the two arbitrators so selected shall select a third arbitrator within ten (10)
days of their appointment. Each party shall bear its own costs and expenses and
an equal share of the arbitrator's expenses and administrative fees of
arbitration.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
XxxxxXxxxx.xxx, Inc.
/s/Xxxxx X. Xxxxxx /s/ Xxxxx Xxxxx
__________________________________ __________________________________
Xxxxx X. Xxxxxx, CEO Employee Xxxxx Xxxxx
