EXHIBIT 10.19
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT, is dated this 20th day of November, 1998, by
and between Voice Quest, Inc., the "Employer" and Xxxx Xxxxxx, the "Employee".
1. EMPLOYMENT: The Employer employs the Employee and the Employee
accepts employment upon the terms and conditions of this Agreement.
2. TERMS: The term of this Agreement shall begin on the Closing Date of
the purchase of Employer's Stock by Carnegie International Corporation and shall
continue for a period of five (5) years, unless terminated prior thereto.
3. COMPENSATION: For all services rendered by the Employee, the
Employer shall pay the Employee an annual salary for the first year of this
Agreement of Seventy-five Thousand Dollars ($75,000.00) to be paid through Three
Thousand One Hundred Twenty-five Dollar ($3,125.00) semi-monthly payments. The
annual salary shall cease in the event of the death or termination of employment
of Employee. Salary payments shall be subject to withholding and other
applicable taxes. The annual salary for the second and third years of this
Agreement shall be Eighty-seven Thousand Five Hundred Dollars ($87,500.00) and
One Hundred Thousand Dollars ($100,000.00), respectively. A cost of living
increase of twenty-five percent (25%) shall apply to the above salaries if
Employee is required to move permanently to Maryland.
4. DUTIES: The Employee is engaged to serve as the President of
Employer. Employee's duties include but are not limited to managing the
operations of the Company. The precise services of the Employee may be extended
or curtailed by the Employer from time to time.
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5. EXTENT OF SERVICES: The Employee shall devote substantially his
entire working time, attention and energies to the Employer's business and shall
not during the term of this Agreement be engaged in any employment activities,
undertake to work for compensation or accept employment with another entity for
gain, profit, or other pecuniary advantage. However, the Employee may invest his
assets in such form or manner as will not require his services in the operation
of the affairs of the companies in which such investments are made.
6. DISCLOSURE OF CONFIDENTIAL INFORMATION: The Employee acknowledges
that he will have access to significant amounts of confidential information of
Employer and its Parent Company, Carnegie International Corporation, including
such information as lists of customers, sources of supply, production
information, product information, service information, formulas, computer
programs and development ideas related thereto, work in progress, trade secrets,
technical information acquired by Employee from Employer or Carnegie or from the
inspection of Employer's or Carnegie's property, confidential information
disclosed to Employee by third parties, and all documents, things and record
bearing media disclosing or containing the aforegoing information, including any
confidential materials prepared by the parties hereto which contain or otherwise
relate to such information concerning the Employer's and/or Carnegie's
financial, intellectual, technical and commercial information (collectively
hereinafter referred to as "Confidential Information") shall be and remain
confidential. The Employee will not during or after the term of this employment,
disclose the Confidential Information or any part thereof to any person, firm,
corporation, association, or other entity for any reason or purpose whatsoever.
In the event of a breach or threatened breach
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by the Employee of the provisions of this paragraph, the Employer shall be
entitled to an injunction restraining the Employee from disclosing, in whole or
in part, the Confidential Information, or from rendering any services in
connection with the telecommunications industry to any person, corporation,
association, or other entity to whom such Confidential Information, in whole or
in part, has been disclosed or is threatened to be disclosed. Nothing herein
shall be construed as prohibiting the Employer or Carnegie from pursuing any of
the remedies available to the Employer for such breach or threatened breach,
including the recovery of damages from the Employee. The Employee shall be
responsible to Employer and Carnegie for reasonable attorneys fees and costs
incurred in connection with the enforcement of this provision should a Court of
competent jurisdiction rule in favor of Employer or Carnegie in connection with
a cause of action brought for enforcement of said provision. If Employee buys
back the Shares of Employer, the provisions hereof relating only to Employer
shall no longer apply.
7. EXPENSES: The Employee may incur reasonable expenses for promoting
the Employer's business. The Employer shall reimburse the Employee for all such
expenses upon the Employee's periodic presentation of an itemized account of
such expenditures.
8. VACATIONS: The Employee shall be entitled to ten (10) vacation days
during each of the first two (2) years of employment and fifteen (15) vacation
days each year thereafter, during which time his salary and benefits shall be
paid in full. Each vacation shall be taken so as not to unreasonably interfere
with the operation of Employer's business.
9. SURVIVAL AFTER TERMINATION OR EXPIRATION OF EMPLOYMENT RELATIONSHIP:
The Provisions contained within paragraphs 6, 11 and 14 of this
Agreement shall
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survive the expiration or other termination of this Agreement
10. TERMINATION: The following termination provisions shall apply
hereto:
a. Termination by Employer for cause. The Employer may terminate
this Agreement immediately by written notice if Employee is convicted of any
crime involving fraud, dishonesty, or willful misconduct directly or indirectly
connected to Employee's duties and responsibilities to Employer or the
management and or operation of Employer's business. If Employer chooses not to
pursue criminal action against Employee in connection with fraud, dishonesty, or
willful misconduct that has a material impact on the Employer, the Employer may
terminate this Agreement for such cause, after written notice to the Employee of
the reason for termination and failure by the Employee within thirty (30) days
thereafter to cure or eliminate such reason for termination and compensate
Employer for any losses sustained as a result of Employee actions in connection
with such fraud, dishonesty or willful misconduct. All terminations made
pursuant to this paragraph shall be considered for cause and the Employer shall
not be liable for any amounts pursuant to this Agreement following such
termination.
b. Termination by Employer for other than cause. If the Employer
terminates this Agreement for any reason other than cause during the final three
(3) years of the term of this Agreement, the Employer shall pay to the Employee
one (1) year of salary as delineated in paragraph 3 of this Agreement.
c. Termination by Employee for Good Reason. The Employee may
terminate his employment with Employer pursuant to this Agreement for "good
reason", provided that the Employee has given written notice to the Employer of
the reason of the resignation and Employer fails to cure or eliminate such
reason within thirty (30) days from the
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receipt of such written notice by Employer. For the purposes of this Agreement,
good reason shall mean: (i) removal from the position of President, other than
as a result of promotion; (ii) material diminution of the Employee's title,
position or responsibilities; (iii) material reduction in the Employee's salary;
(iv) relocation of the Employee to a location more than one hundred (100) miles
from the Employee's principal work place at the time this Agreement takes effect
except for a move to Maryland for which the Employee receives a twenty-five
percent (25%) cost of living increase in his salary; or (v) the Employer's
willful failure to comply with and satisfy material requirements of this
Agreement. If the Employee terminates his employment for good reason during the
final three (3) years of the term of this Agreement, the Employer shall pay to
the Employee one (1) year of salary as delineated in paragraph 3 of this
Agreement.
d. Termination by Employee for other than good reason. Employee
may terminate this Agreement for any reason or no reason at any time, upon
thirty (30) days written notice to the Employer. In such event, the Employee if
requested by the Employer, shall continue to render his services and receive
full salary and benefits up to the date of termination. The Employer may elect
to terminate Employee by written notice thereof before the expiration of the
thirty (30) day period and discontinue all salary and benefits as of said
termination date. If Employee terminates this Agreement for any reason other
than good reason, the Employer shall not be liable for any amounts due to
Employee pursuant to the terms of this Agreement.
e. Other Termination. This Agreement shall terminate upon the
occurrence of any of the following events:
1. Expiration of the term of employment, as provided in
Section 2 hereof; or
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2. Death of Employee, except for those benefits as provided
to the contrary herein; or
3. In the event Employee shall become permanently disabled as
defined in the following paragraph and such permanent disability prevents the
Employee from substantially performing the duties of his employment.
11. EMPLOYEE'S REPRESENTATIONS: Employee represents and warrants to
Employer that no legal, administrative or other proceedings against the Employee
have been threatened or filed in any federal, state or local court of law or
before any administrative body.
12. OTHER BENEFITS AND COMPENSATION:
a. Health insurance coverage shall be provided to Employee
comparable to the coverage being provided to Executives in comparable positions
with Carnegie International Corporation ("Carnegie").
b. Employee shall be reimbursed for all reasonable and necessary
company expenses attributable to the business of Voice Quest or Carnegie.
c. Employee shall receive disability and life insurance coverage
consistent with the current coverage provided to Employees with comparable
positions at Carnegie International Corporation ("Carnegie"). As of the date of
this Agreement no such benefits are being provided.
d. Employee shall receive a bonus equal to three percent (3%) of
the gross profit generated by Voice Quest from the sale of Personal Operator or
Xxxxx XXXXX(TM) software. Gross profit shall be defined as sales from said
products less costs of goods sold.
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Costs of goods sold shall include, but not be limited to, sales and marketing
expenses, software development costs, costs of reproducing the products, product
materials, direct labor and reasonable overhead costs. This bonus shall be paid
within ten (10) business days from the end of each calendar year, fifty percent
(50%) of which shall be paid in cash, and fifty percent (50%) of which shall be
paid through an issuance to Employee of Rule 144 shares of Carnegie, valued
based on the average closing price of Carnegie Common Stock for five (5) days
prior to the issuance. For a period of five (5) years after the termination of
this Agreement, Employee shall receive three percent (3%) of the gross profits,
as defined above, generated by Voice Quest from sales of Personal Operator or
XXXXX(TM) software products that incorporate features that were developed by
Employee.
e. Employee shall receive a Company vehicle during the term of his
employment.
13. RESTRICTIVE COVENANTS: During the period of this Agreement and for
a period of two (2) years after the termination or expiration of this Agreement,
the Employee will not, within the geographical customer market of Voice Quest,
directly or indirectly, own, manage, operate, control, be employed by or
participate in any business that competes with and or sells similar products and
or services as the business conducted by the Employer at the time of the
termination of this Agreement, including but not limited to voice recognition
software and related products and services that are related to said products or
services. In the event of the Employee's actual or threatened breach of the
provisions of this paragraph, the Employer shall be entitled to an injunction
restraining the Employee therefrom. Nothing shall be construed as prohibiting
the Employer from pursuing any other available remedy for such breach or
threatened
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breach, including the recovery of damages from the Employee. If Employee buys
back the Shares of Employer the provisions hereof shall no longer apply.
14. OWNERSHIP OF OTHER PUBLIC COMPANIES: Employee may own up to five
percent (5%) of public companies other than Carnegie, provided such ownership is
not inconsistent with the terms and conditions of this Agreement and or
otherwise prohibited by Law.
15. NOTICES: Any Notice required or desired to be given under this
Agreement shall be deemed given if in writing sent by certified mail to his
residence in the case of the Employee, or to its principal office in the case of
the Employer.
16. WAIVER OF BREACH: The waiver of the Employer of a breach of any
provision of this Agreement by the Employee shall not operate or be construed as
a waiver of a subsequent breach by the Employee.
17. ASSIGNMENT: The Employee acknowledges that the services to be
rendered by her are unique and personal. Accordingly, the Employee may not
assign any of her rights, or delegate any of his duties or obligations under
this Agreement. The rights and obligations of the Employer under this Agreement
shall inure to the benefit and shall be binding upon the successors and assigns
of the Employer.
18. ENTIRE AGREEMENT: This Agreement contains the entire understanding
of the parties. No representations were made or relied upon by either party,
other then those expressly set forth. No agent, employee, or other
representatives of either party are empowered to alter any of the terms hereof,
unless they are in writing and signed by the Employee and an executive officer
of the Employer.
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19. CONTROLLING LAW: The validity, interpretation and performance of
this Agreement shall be controlled by and construed under the Laws of the State
of Maryland.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
ATTEST: EMPLOYER: VOICE QUEST, INC.
/s/ BY:/s/Xxxxxx Xxxxxx
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XXXXXX XXXXXX, Chairman
WITNESS: Employee:
/s/ /s/Xxxx Xxxxxx
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XXXX XXXXXX
Carnegie.24EmployAgmtOrtner.07
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