EXHIBIT 10.7
EMPLOYMENT AGREEMENT
--------------------
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made effective as of
the 1st day of August 15, 2002, by and between Case Financial, Inc., a
California corporation (the "Company"), and Xxxxx Xxxxx ("Employee").
In consideration of the mutual promises herein contained and other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, Employee and the Company agree as follows:
1. TERM. Subject to the terms and conditions herein contained, the
Company hereby employs Employee, and Employee hereby accepts such employment,
for a period of twenty-four (24) months beginning as of the effective date of
this Agreement.
2. POSITION. During Employee's employment hereunder, Employee will hold
the position of Vice President Sales and Marketing for the Company and/or such
other management position(s) as the Board of Directors may determine in its sole
discretion. As Vice President of Sales and Marketing, Employee's duties shall
include, but shall not be limited to, those set forth on EXHIBIT A attached
hereto, which may be amended from time to time upon the mutual written agreement
of the Company and Employee.
3. COMPENSATION.
(a) BASE COMPENSATION. As consideration for all services which
Employee may render to the Company or its subsidiaries in any capacity during
the term hereof, Employee will receive, and the Company hereby agrees to pay
Employee, base compensation ("Base Compensation") at the annual rate of Eighty
($80,000) per year commencing on the date of this Agreement. Upon each yearly
anniversary of the date of this Agreement, Employee's Base Compensation
automatically shall be increased by the "Cost of Living" based on the accepted
"Cost of Living Index
(b) SIGNING BONUS. Upon the execution of this Agreement,
Employee shall be entitled to receive from the Company One Hundred and Fifty
Thousand (150,000) shares of the Company's common stock, $.0001 par value per
share ("Common Stock").
(c) ANNUAL BONUS. Employee shall also be entitled to receive
from the Company with respect to each fiscal year during the term of this
Agreement, such bonus ("Bonus") as the Company's Board of Directors or the
Compensation Committee of such Board shall determine; provided, however, that
nothing herein shall be deemed to require that a bonus be paid with respect to
any given fiscal year and that, in determining the level of bonus, if any,
payable for a given fiscal year, the Board of Compensation Committee may
consider the Automatic Annual Increase as part of any Bonus. The bonus shall not
exceed Fifty Thousand Dollars ($50,000) per each fiscal year.
Employee's Base Compensation, as increased by any Automatic Annual
Increase, Commission and Bonus are hereinafter collectively referred to as
"Compensation."
4. BENEFITS; EXPENSES; AND VACATION. In addition to the Compensation,
Employee shall be entitled to receive the following additional benefits during
the term of this Agreement only to the extent the benefits are offered by the
Company and the below benefits may be modified or revoked at any time by the
Company if an insurer either modifies or revokes any of the below noted
benefits:
(a) a car allowance in the amount of $350 per month,
(b) Company-paid health, life, disability and/or dental
insurance (all on such terms and with such insurers as the Company shall offer
to its other executive officers); and
(c) all such other fringe benefits and perquisites, if any, as
the Company shall from time to time make generally available to employees of the
Company.
(d) Paid vacation of 3 weeks in the first year of this
Contract and 4 weeks in the second year of the Contract. Such vacation time
shall not be cumulative.
(e) Company-paid cell phone expenses.
(f) Reimbursement of reasonable expenses.
5. FULL-TIME EMPLOYMENT. During the term hereof, Employee will devote
his full time and best efforts to the business of the Company.
6. NON-COMPETITION.
(a) Throughout the term of this Agreement and for twelve (12)
months following the termination of this Agreement, Employee agrees not to
compete with the business of the Company anywhere in the United States. The
phrase "compete with the business of" shall be deemed to include engaging or
being interested, directly or indirectly, as an owner, employee, general
partner, consultant, through stock ownership, investment of capital, or
rendering of services, either alone or in association with others, in the
ownership, operation, management or supervision of any type of business or
enterprise competitive with the Company. The foregoing shall not prevent
Employee from owning up to 5% of the outstanding securities of a publicly held
corporation which may compete with the business of the Company.
-2-
( (b) TRADE SECRETS AND CONFIDENTIAL INFORMATION.
(1) TRADE SECRETS. Employee recognizes and acknowledges that by virtue of
Employee's employment with the Company, Employee will have access to
certain trade secrets and confidential information of the Company and
that such information constitutes valuable, special and unique property
of the Company, and derives economic value because it is not generally
known to the public or to others who could benefit from its disclosure
or use ("Trade Secrets and Confidential Information"). Trade Secrets
and Confidential Information includes, but is not limited to, the
following: (i) customer information, including, without limitation,
customer lists and other information concerning particular needs,
problems, likes or dislikes of the Company's customers; (ii) the
identities of the Company's customers; (iii) price information, such as
price lists, the contents of bids, and other information concerning
costs or profits; (iv) technical information, such as formulae,
know-how, computer programs, software, secret processes or machines,
inventions and research projects, documentation, or other methods or
processes; (v) business information relating to costs, profits, sales,
markets, suppliers, plans for further development, market studies,
methods of doing business or research projects; (vi) personnel or a
compilation of data concerning the Company `s employees and independent
contractors; and (vii) any other information valuable because of its
private or confidential nature. Trade Secrets and Confidential
Information may be oral or written and may be information which
Employee originates or which otherwise comes into Employee's possession
or knowledge. All such Trade Secrets and Confidential Information
constitute valuable, special and unique property of the Company and
derive economic value because such Trade Secrets and Confidential
Information are not generally known to the public or to others who
could benefit from their disclosure or use.
(2) CONFIDENTIAL INFORMATION. Employee agrees that Employee shall treat all
Trade Secrets and Confidential Information of the Company as
confidential and shall not divulge or disclose any of same gained in
connection with Employee's employment by the Company to any other
person, firm, corporation or entity ("Person"), except upon the written
request or instruction of the Company or in the normal course of
Employee's duties as a Company Employee or as otherwise required by law
or legal process.
(3) RETURN OF CONFIDENTIAL INFORMATION. Employee covenants and acknowledges
that upon separation from employment with the Company, Employee shall
immediately surrender to the Company all of the Company's Trade Secrets
and Confidential Information and any and all such documents, materials
or other tangible items pertaining to these Trade Secrets and
Confidential Information that Employee may possess and that such Trade
Secrets and Confidential Information shall be and remain the sole
property of the Company. Employee agrees that if Employee is in doubt
as to whether any information, material, or document is a Trade Secret
or is Confidential Information, Employee will contact the Board of
Directors of the Company before disclosing or using same for any
purpose other than in furtherance of Employee's duties as an employee
of the Company. The covenants of this Section 8 shall continue for as
long after the termination of this Employment Agreement as any Trade
Secret or Confidential Information continues to constitute a trade
secret under applicable law.
-3-
(c) INVENTIONS AND CREATIONS.
(1) INVENTIONS. Employee agrees that the Company shall be entitled to all
rights to all inventions, discoveries, developments, improvements, mask
works, and other contributions relating in any way to the business or
research of, or products or services sold by, the Company (herein
called collectively "Inventions") to the extent protectable by law,
that Employee conceives, makes, develops or acquires, either
individually or jointly, during Employee's employment with the Company
and which relate in any manner to Employee's work, the Company's
research, business or products or fields to which the business of the
Company may reasonably extend. Employee further agrees to assign and
transfer to the Company Employee's entire right, title and interest in
and to the Inventions and not to disclose such Inventions to others
without the prior written consent of the Company, except as required by
Employee's employment by the Company or by law.
(2) DISCLOSURE AND PROTECTION OF INVENTIONS. Employee further agrees to
promptly and fully disclose the Inventions to the Company, in writing
if requested by the Company, and to execute and deliver any and all
lawful applications assignments and other documents which the Company
requests for protecting the Inventions in the United States or any
other country. The Company shall have the full and sole power to
prosecute such applications and to take all other action concerning the
Inventions, and Employee agrees to cooperate fully, at the expense of
the Company, in preparing and prosecuting all such applications and in
any legal actions and proceedings concerning the Inventions in the
United States and in foreign countries, including assigning priority
rights and executing any and all applications, including renewals,
extensions and divisions thereof.
(3) ASSIGNMENT OF CREATIONS. Employee agrees to and does hereby assign,
convey and transfer to the Company any and all manuscripts, computer
programs, writings, pictorial materials and other creations (herein
called collectively "Creations"), created by Employee, either
individually or jointly, in the course of Employee's employment by the
Company and which relate to the Company's business, research, products
or services. The Company shall have the full right to seek and procure
copyrights on the Creations, and Employee shall cooperate fully, at the
expense of the Company, in securing copyrights and in any legal actions
and proceedings concerning the Creations in the United States and in
foreign countries, including executing any and all applications,
including renewals thereof. Employee further agrees not to disclose
such Creations to others without the prior written consent of the
Company, except as required by Employee's employment by the Company or
by law.
(4) NO ADDITIONAL COMPENSATION. Employee shall not be entitled to any
additional compensation for any services the Company shall require to
be rendered by Employee under this Section.
-4-
(b) NON-SOLICITATION. Employee agrees and acknowledges that Employee's
services hereunder are of a special, unique, extraordinary character, that
Employee's employment with the Company places Employee in a position of
confidence and trust and that Employee's services hereunder necessarily will
require the disclosure to Employee of Confidential Information of the Company.
Employee consequently agrees that it is reasonable and necessary for the
protection of the goodwill and business of the Company that Employee make the
covenants contained herein and that Company is relying upon and is induced by
the agreements made by Employee in this paragraph. Accordingly, Employee agrees
that during the term of this Agreement and for a twelve (12) month period
thereafter, Employee shall not, except on behalf of the Company, directly or
indirectly, and regardless of the reason for the cessation of Employee's
employment (i) attempt in any manner to persuade any third party to cease to do
business, or to reduce the amount of business which any such party customarily
has done or contemplates doing, with the Company, whether or not the
relationship between the Company and such third party was originally established
in whole or in part through Employee's efforts; or (ii) on Employee's own behalf
or otherwise, hire, solicit, seek to hire, or offer employment to any person who
is, during any such time period, an employee of or independent contractor with
the Company, or in any other manner attempt, directly or indirectly, to
influence, induce or encourage any such person to leave the employ of, or
terminate or diminish such person's business relationship with, the Company. As
used in this paragraph, the verb 'employ' shall include its variations, for
example, retain or engage; and the "Company" shall include Case Financial, Inc.
and each of its direct or indirect subsidiaries.
The covenants of Employee set forth in this Section 6 are made in consideration
of the payments made to Employee pursuant to this Agreement, the receipt,
adequacy and sufficiency of which are acknowledged by Employee, and such
covenants have been made by Employee to induce the Company to enter into this
Agreement.
7. STOCK OPTIONS. In consideration of his services hereunder, Employee
shall be entitled to receive from the Company and the Company shall grant to
Employee concurrently with the execution hereof, an option to purchase up to
225,000 shares of Common Stock at the price of the stock on the close of
business on May 24, 2002 which was the day the transaction with Asia Web
Holdings Inc. closed. The options shall vest equally over a period of three (3)
years (i.e. 6,250 options per month over the 3 years) and shall start to vest as
of the date of this Contract.
8. OWNERSHIP OF COPYRIGHT; WORK PRODUCT. Employee, in his time and
scope of employment under this Agreement, may create or draft documents
including, but not limited to forms, letters, correspondence, charts, graphs,
spreadsheets, illustrated pictures, digital pictures, photographic pictures,
video presentations and musical compositions related to the business of the
Company. Employee hereby acknowledges that any such documents produced in the
course and scope of the employment relationship are the work product of the
Company and all copyrights, patents, trademarks and all other rights to such
works are owned by the Company. Upon the conclusion of Employee's employment
with the Company, such documents will remain the intellectual property of the
Company and are to remain at the Company's headquarters. Employee agrees to
execute any and all documents reasonably requested by the Company to effect the
provisions of this Section 8.
-5-
9. DRUG TESTING. The Company may, at its discretion, require Employee
to submit to drug testing at an appropriate medical facility if Company
management has a reasonable suspicion of Employee's continued use of narcotics
and/or alcohol (collectively "drug use"). If the drug test indicates drug use,
Employee shall be entitled to a second test within seven (7) days of the results
and if the second test indicates use in addition to the first test, or of Xxxxx
refuses to submit to drug tests, the Company may terminate Xxxxx immediately.
10. TERMINATION.
(a) TERMINATION OF AGREEMENT. Notwithstanding any other
provision of this Agreement, either party shall have the right to terminate this
Agreement at any time, for any reason, upon 30 days written notice to the other
party.
(b) EFFECT OF TERMINATION.
(i) TERMINATION WITHOUT CAUSE. In the event the Company
terminates Employee during the term of this Agreement without "cause" (as
defined below), the Company shall (i) continue to pay Employee his Base
Compensation then in effect for the remainder of the term of the Agreement, and
(ii) continue to provide Employee with the stockoptions as outlined in Section 7
of this Agreement . As a condition to the receipt of the Base Compensation and
benefits as set forth in Section 4, Employee shall make diligent efforts to
mitigate his damages by seeking other employment and shall advise the Company of
such efforts made. To the extent Employee receives compensation or benefits from
such other employment or other collateral source, the payment of the Base
Compensation and the benefits pursuant to Section 4 shall be correspondingly
reduced.
(ii) TERMINATION FOR CAUSE. In the event of termination
by the Company for cause, or in the event Employee voluntarily terminates this
Agreement, no further payments of any Compensation shall be made to Employee,
except for payment of the Base Compensation then in effect during the 30-day
notice period described in Section 8(a) and except for those options that have
already vested. Employee shall not be entitled to any oprtions that have not
vested as of the time of termination under this Paragraph 10(b). .
(iii) CAUSE. For the purposes hereof, "cause" shall be
limited to the following: (i) conviction of a felony; (ii) commission of any
intentional and material act involving fraud or misappropriation of funds,
properties or assets of the Company; (iii) chronic alcoholism, drug addiction or
substance abuse; (iv) failing, or refusing to submit to, a drug test in
accordance with Section 9 of this Agreement, (v) gross negligence in the
performance of Employee's duties hereunder, (vi) gross negligence in the
performance of Employee's duties hereunder which the Board of Directors of the
Company determines to have a material adverse effect on the Company; or (vii)
any material violation of any written policies of the Company which, to the
extent curable, are not cured within thirty (30) days of Employee's receipt of
notice thereof.
(c) SURRENDER OF BOOKS AND RECORDS. Upon the termination of
this Agreement, for any reason, Employee shall immediately surrender to the
Company all lists, books, records and other documents incident to the Company's
business and all other property belonging to the Company, it being distinctly
understood that all such lists, books, records and other documents are the
property of the Company.
-7-
11. SURVIVAL. Upon the expiration or other termination of this
Agreement, all obligations of the parties shall forthwith terminate, except for
any obligation to pay any fixed sum of money or to grant any Options pursuant to
Section 7 which may have accrued and be due and payable hereunder at the time of
such expiration or other termination and except that the provisions of Section 6
shall continue in full force and effect in accordance with its terms, such
Section containing independent agreements and obligations.
12. INDEMNITY. The Company agrees to defend, indemnify and hold
harmless Employee from any and all claims, actions, lawsuits or other choses in
action brought against Employee by any person/third party in connection to or
related in any manner whatsoever to Employee's duties, obligations and/or
responsibilities arising out Employee's employment with Company.
13. INCAPACITY. In the event Employee becomes "incapacitated" (defined
as so seriously injured that Employee is physically and/or mentally unable to
complete his/her duties under the term of the Contract) Company shall agree to
pay at least three (3) months of Employee's compensation and benefits as under
the term and conditions of this Contract from the date Employee is determined to
be "incapacitated." Company retains the right at their expense to have their own
physician(s) or other health care provider(s) examine Employee to determine if
Employee is "incapacitated"
14. EQUITABLE REMEDIES. The agreements of the parties contained in
Section 6 and 8 are of a special, unique and extraordinary character; the
obligations contained therein shall therefore be enforceable both at law and in
equity, by injunction and otherwise; and the rights and remedies of the Company
and the Employee hereunder with respect thereto shall be cumulative and not
alternative and shall not be exhausted by any one or more uses thereof.
15. ENTIRE AGREEMENT; WAIVERS AND AMENDMENTS. This Agreement sets forth
the entire agreement between the parties with respect to the terms and
conditions of Employee's employment and any and all matters related thereto, and
any and all prior agreements with respect to any thereof, whether oral or
written, are superseded hereby. Neither this Agreement nor any term or condition
hereof, including, without limitation, the terms and conditions of this
paragraph, may be waived or modified in whole or in part as against the Company
or Employee, as the case may be, except by written instrument signed by an
authorized officer of the Company or by Employee, as the case may be, expressly
stating that it is intended to operate as a waiver or modification of this
Agreement, and any such written waiver by either party of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach hereof.
-8-
16. NOTICE. Any notice hereunder shall be in writing and shall be
deemed given or delivered two (2) days after it has been mailed by registered or
certified mail, postage prepaid, or one (1) day after being sent by a recognized
national courier service, in each case addressed as follows:
If to Company: Case Financial, Inc.
00000 Xxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
If to Employee: Xxxxx Xxxxx
0000 Xxxxxxx Xxx, #000
Xxxxxx, XX 00000
except that either party may from time to time by written notice to the other,
designate another address which shall thereupon become his effective address for
the purposes of this Section.
17. SEVERABILITY. If any term or provision of this Agreement or the
application thereof to any person, property or circumstance shall to any extent
be invalid or unenforceable, the remainder of this Agreement or the application
of such term or provision to persons, property or circumstances other than those
as to which it is invalid or unenforceable, shall not be affected thereby, and
each term and provision of this Agreement shall be valid and enforced to the
fullest extent permitted by law.
18. NO ASSIGNMENT. This Agreement is personal in nature and the
obligations hereunder may not be assigned by the Company or by Employee without
the prior written consent of the other party hereto; provided, however, that the
provisions hereof shall inure to the benefit of, and be binding upon each
successor of the Company, whether by merger, consolidation, transfer of all or
substantially all of its assets, or otherwise.
19. GOVERNING LAW. This Agreement shall be construed and enforced in
accordance with the laws of the State of California.
20. ARBITRATION; VENUE.
(a) Subject to the provisions of Section 13 hereof, any
dispute, controversy or claim arising out of, relating to, or in connection
with, this Agreement or the agreements or transactions contemplated hereby shall
be finally settled by arbitration conducted in accordance with the provisions of
this Section 18. The arbitrator shall be a retired judge or practicing attorney
and the arbitration shall be conducted and the arbitrator chosen in accordance
with the rules of the American Arbitration Association (the "AAA") in effect at
the time of the arbitration, except as they may be modified herein or by mutual
agreement of the parties hereto (the "Parties"). If the Parties are unable to
agree on the location of the arbitration within five (5) business days after the
date of delivery of the request of arbitration, the Parties agree the
arbitration will be conducted in Los Angeles County, California. Each Party
hereby irrevocably submits to the jurisdiction of the arbitrator in Los Angeles,
California and waives any defense in an arbitration based upon any claim that
such Party is not subject personally to the jurisdiction of such arbitrator,
that such arbitration is brought in an inconvenient forum or that such venue is
improper.
-9-
(b) The arbitral award shall be in writing and shall be final
and binding on the Parties. The award may include an award of costs, including
reasonable attorneys' fees and disbursements. Judgment upon the award may be
entered by any court having jurisdiction thereof or having jurisdiction over the
Parties or their assets.
(c) Any dispute, controversy or claim arising out of, relating
to, or in connection with, this Agreement or the agreements or transactions
contemplated hereby, as well as any arbitration proceeding under this Section
18, shall be deemed to be "Confidential Information," subject to the provisions
of Section 6 of this Agreement.
21. ATTORNEYS' FEES. In the event of suit, arbitration or other
proceeding between the parties hereto with respect to this Agreement, the
prevailing party shall, in addition to such other relief as may be awarded, be
entitled to reasonable attorneys' fees, expenses and costs of investigation, all
as actually incurred.
IN WITNESS WHEREOF, the undersigned have executed this Agreement
effective as of the date first set forth above.
CASE FINANCIAL, INC.
By:
--------------------------------
Name:
Title:
/s/ Xxxxx Xxxxx
------------------------------------
XXXXX XXXXX
-10-
EXHIBIT A
DESCRIPTION OF DUTIES
As Vice President of Sales and Marketing, Employee shall report
directly to the President and CEO. Employee's duties shall include but are not
limited to the following in his capacity as Vice President of Sales and
Marketing:
1. Develop and launch new products or services for the Company.
a. Identify customer demand.
b. Develop all necessary marketing materials.
c. Identify potential customers and markets.
d. Coordinate all marketing activities.
e. Coordinate all roll-out activities to District Managers
f. Develop new distribution channels for sales.
2. Develop and improve existing relationships with local and regional Bar
Associations, Trial Lawyers Associations and other professional
attorney organizations.
3. Develop and maintain a comprehensive Sales and Marketing Plan
4. Develop educational courses for MCLE approval.
-11-
EXHIBIT B
OPTION AGREEMENT
-12-
