Exhibit 10.7
EMPLOYMENT AGREEMENT
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EMPLOYMENT AGREEMENT (this "Agreement"), entered into as of this 15th day
of August, 1997, by and between CONNECTSOFT COMMUNICATIONS CORPORATION, a
Delaware corporation having its principal offices at 00000 X.X. 00xx Xxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxxx 00000 (the "Company"), and XXXXXX X. XXXXX, an
individual residing at 00 Xxxxxxxx Xxxxxxxxx, Xxx Xxxxx, Xxx Xxxx 00000 (the
"Employee");
W I T N E S S E T H :
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WHEREAS, the Employee has extensive experience relating to the management
and finance of computer software and computer related technology companies; and
WHEREAS, in order to preserve the goodwill of the Company and to assist in
the strategic direction of the Company, the Company desires to assure itself of
the right to the Employee's services, on the terms and conditions of this
Agreement; and
WHEREAS, the Employee is willing and able to render his services to the
Company on the terms and conditions of this Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the parties hereby agree as follows:
1. NATURE OF EMPLOYMENT.
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(a) Subject to the terms and conditions of this Agreement, the
Company shall, throughout the term of this Agreement, retain the Employee, and
the Employee shall render services to the Company, in the capacity and with the
title of Chairman of the Board of the Company, and/or such other titles as may
be assigned to the Employee from time to time by the Board of Directors of the
Company (the "Board"). In such capacity, the Employee shall aid and assist the
Company in obtaining financing and in connection with their general policies and
procedures, including without limitation, ongoing merger and acquisition
strategy, new business development, corporate finance, marketing and positioning
in the marketplace, strategic partnership arrangements, personnel and management
hiring activities and other matters as from time to time requested by the Board
of Directors of the Company and agreed to by the Employee. The Employee shall be
required to devote no more than 10% of his business time to the provision of
such services.
(b) Throughout the period of his employment hereunder, the Employee
shall: (i) devote his attention, knowledge and skills, faithfully, diligently
and to the best of his ability, to the active performance of his duties and
responsibilities hereunder on behalf of the Company and (ii) observe and carry
out such reasonable rules, regulations, policies, directions and restrictions as
may be established from time to time by the Board, including but not limited to
the standard policies and procedures of the Company as in effect from time to
time.
2. TERM OF EMPLOYMENT.
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(a) The term of this Agreement shall begin upon the effective date of an
initial public offering of equity securities by the Company (the "Effective
Date") and shall terminate upon the earliest of (i) the Employee's death, (ii)
any termination pursuant to paragraph (b) of this Section 2 or (iii) the date on
which shall be three (3) years from the Effective Date.
(b) The Company shall have the right to terminate this Agreement at any
time for "cause" upon written notice to the Employee, and such termination shall
be effective upon delivery of such notice. For purposes of this Agreement,
"Cause" shall mean a material breach of this Agreement by the Employee
determined to have occurred in good faith by a resolution of the Company's Board
of Directors, including willful and deliberate malfeasance or gross negligence.
3. COMPENSATION AND BENEFITS.
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(a) COMPENSATION. In consideration for the services to be rendered by the
Employee hereunder, the Company shall pay the Employee an annual base salary of
$75,000. This compensation shall be paid in installments at such times as the
Company customarily pays its senior management, but in no event less frequently
than once per month.
(b) FRINGE BENEFITS. The Company may also make available to the Employee,
throughout the period of his employment hereunder, such benefits and perquisites
as are generally provided by the Company to its employees, including but not
limited to eligibility for participation in any group life, health, dental,
disability or accident insurance, pension plan, profit-sharing plan, or other
such benefit plan or policy which may presently be in effect or which may
hereafter be adopted by the Company for the benefit of its employees generally;
PROVIDED, HOWEVER, that nothing herein contained may be deemed to require the
Company to adopt or maintain any particular plan or policy. Participation in
such benefit plans may be subject to standard waiting periods following the
commencement of full-time employment.
(c) EXPENSES. The Company will pay or reimburse the Employee for all
reasonable and necessary direct out-of-pocket expenses incurred in connection
with the performance by the Employee of his responsibilities hereunder in
accordance with the Company's usual and customary practices.
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(d) VACATION. The Employee may be entitled to take, from time to time,
normal and reasonable vacations with pay, consistent with the Company's standard
policies and procedures in effect from time to time, at such times as shall be
mutually convenient to the Employee and the Company, and so as not to interfere
unduly with the conduct of the business of the Company.
4. RESTRICTIVE COVENANTS.
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(a) The Employee hereby acknowledges and agrees that (i) the business
contacts, customers, suppliers, technology, product designs and specifications,
know-how, trade secrets, marketing techniques, promotional methods and other
aspects of the business of the Company have been and are of value to the
Company, and have provided and will hereafter provide the Company with
substantial competitive advantage in the operation of its business, and (ii) he
has and will continue to have detailed knowledge and possesses and will possess
confidential information concerning the business and operations of the Company.
The Employee hereby further acknowledges that his business skills are not
uniquely suited to businesses of the type conducted by the Company, and that, if
required, he could readily adapt and utilize such skills in one or more other
types of businesses.
(b) The Employee shall not, directly or indirectly, for himself or through
or on behalf of any other person or entity:
(i) at any time, divulge, transmit or otherwise disclose or
cause to be divulged, transmitted or otherwise disclosed, any business contacts,
client or customer lists, technology, know-how, trade secrets, marketing
techniques, contracts or other confidential or proprietary information of the
Company of whatever nature, whether now existing or hereafter created or
developed (provided, however, that for purposes hereof, information shall not be
considered to be confidential or proprietary if (A) it is a matter of common
knowledge or public record, (B) it is generally known in the industry, or (C)
the Employee can demonstrate that such information was already known to the
recipient thereof other than by reason of any breach of any obligation under
this Agreement or any other confidentiality or non-disclosure agreement); and/or
(ii) at any time during the period from the date hereof through
and including the date of the termination of the Employee's employment with the
Company, and for an additional period of one (1) year thereafter unless the
Employee's employment was terminated by reason of an Unjustified Termination
(collectively, the "Restrictive Period"), invest, carry on, engage or become
involved, either as an employee, agent, advisor, officer, director, stockholder
(excluding ownership of not more than 3% of the outstanding shares of a publicly
held corporation if such ownership does not involve managerial or operational
responsibility), manager, partner, joint venturer, participant or consultant, in
any business enterprise (other than American United Global, Inc. (so long as it
is an affiliate of the Company), the Company or any of their respective
subsidiaries, affiliates, successors or assigns) which derives any material
revenues from the offer or sale in the United States, at wholesale or retail, of
any computer software products or other goods or services offered or sold by the
Company or its subsidiaries,
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affiliates, successors or assigns from time to time during the Restrictive
Period, or which engages in any other business similar to or competitive with
the business of the Company or its subsidiaries, affiliates, successors or
assigns (as such business is constituted at the time that the Employee proposes
to become involved in such other business enterprise).
(c) The Employee and the Company hereby acknowledge and agree that, in the
event of any breach by the Employee, directly or indirectly, of the foregoing
restrictive covenants, it will be difficult to ascertain the precise amount of
damages that may be suffered by the Company by reason of such breach; and
accordingly, the parties hereby agree that, as liquidated damages (and not as a
penalty) in respect of any such breach, the breaching party or parties shall be
required to pay to the Company, on demand from time to time, cash amounts equal
to any and all gross revenues derived by the breaching party or parties,
directly or indirectly, from any and all violative acts or activities. The
parties hereby agree that the foregoing constitutes a fair and reasonable
estimate of the actual damages that might be suffered by reason of any breach of
this paragraph 4 by the Employee, and the parties hereby agree to such
liquidated damages in lieu of any and all other measures of damages that might
be asserted in respect of any subject breach.
(d) The Employee and the Company hereby further acknowledge and agree that
any breach by the Employee, directly or indirectly, of the foregoing restrictive
covenants will cause the Company irreparable injury for which there is no
adequate remedy at law. Accordingly, the Employee expressly agrees that, in the
event of any such breach or any threatened breach hereunder by the Employee,
directly or indirectly, the Company shall be entitled, in addition to any and
all other remedies available (including but not limited to the liquidated
damages provided for in paragraph 4(c) above), to seek and obtain injunctive
and/or other equitable relief to require specific performance of or prevent,
restrain and/or enjoin a breach under the provisions of this paragraph 4.
(e) In the event of any dispute under or arising out of this paragraph 4,
the prevailing party in such dispute shall be entitled to recover from the
non-prevailing party or parties, in addition to any damages and/or other relief
that may be awarded, its reasonable costs and expenses (including reasonable
attorneys' fees) incurred in connection with prosecuting or defending the
subject dispute.
5. INVENTIONS; INTELLECTUAL PROPERTY.
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The Employee acknowledges and confirms that any and all inventions,
product designs and specifications, and other intellectual property developed or
utilized by the Employee during the period of his employment hereunder
constitutes, as between the Company and the Employee, the sole and exclusive
property of the Company for which the Employee is being adequately compensated
hereunder; and the Employee shall execute and deliver any and all applications,
assignments and other documents as may be requested by the Company to establish,
protect and enforce the Company's rights in and to such intellectual property.
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6. NON-ASSIGNABILITY.
In light of the unique personal services to be performed by the
Employee hereunder, it is acknowledged and agreed that any purported or
attempted assignment or transfer by the Employee of this Agreement or any of his
duties, responsibilities or obligations hereunder shall be void.
7. NOTICES.
Any notices, requests, demands or other communications required or
permitted under this Agreement shall be in writing and shall be deemed to have
been given when delivered personally, one (1) day after being sent by recognized
overnight courier service will all charges prepaid or charged to the sender's
account, or three (3) days after being mailed by certified mail, return receipt
requested, addressed to the party being notified at the address of such party
first set forth above, or at such other address as such party may hereafter have
designated by notice; PROVIDED, HOWEVER, that any notice of change of address
shall not be effective until its receipt by the party to be charged therewith.
8. GENERAL.
(a) Neither this Agreement nor any of the terms or conditions hereof
may be waived, amended or modified except by means of a written instrument duly
executed by the party to be charged therewith. Any waiver or amendment shall
only be applicable in the specific instance, and shall not constitute or be
construed as a waiver or amendment in any other or subsequent instance. No
failure or delay on the part of either party in respect of any enforcement of
obligations hereunder shall in any manner affect such party's right to seek or
effect enforcement at any other time or in respect of any other required
performance.
(b) Neither this Agreement nor any rights or obligations hereunder
may be assigned by either party without the express prior written consent of the
other party.
(c) The captions and paragraph headings used in this Agreement are
for convenience of reference only, and shall not affect the construction or
interpretation of this Agreement or any of the provisions hereof.
(d) This Agreement, and all matters or disputes relating to the
validity, construction, performance or enforcement hereof, shall be governed,
construed and controlled by and under the laws of the State of Washington.
(e) This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective heirs, executors,
administrators, personal representatives, successors and permitted assigns.
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(f) This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original hereof, but all of which
together shall constitute one and the same instrument.
(g) Except for any legal or judicial proceeding which may be brought
for injunctive and/or any other equitable relief as contemplated by paragraph
4(d) above, any dispute involving the interpretation or application of this
Agreement shall be resolved by final and binding arbitration before one or more
arbitrators designated by the American Arbitration Association in Seattle,
Washington. The award of such arbitrator(s) may be enforced in any court of
competent jurisdiction. The prevailing party in any action or proceeding
hereunder shall be entitled to an award for its costs and reasonable attorneys'
fees in connection with such action or proceeding, and the arbitrator(s) in any
arbitration hereunder shall be empowered and directed to make such an award in
his, her or their discretion.
(h) This Agreement constitutes the sole and entire agreement and
understanding between the parties hereto as to the subject matter hereof, and
supersedes all prior discussions, agreements and understandings of every kind
and nature between them as to such subject matter.
(i) This Agreement is intended for the sole and exclusive benefit of
the parties hereto and their respective heirs, executors, administrators,
personal representatives, successors and permitted assigns, and no other person
or entity shall have any right to rely on this Agreement or to claim or derive
any benefit herefrom absent the express written consent of the party to be
charged with such reliance or benefit.
(j) If any provision of this Agreement is held invalid or
unenforceable, either in its entirety or by virtue of its scope or application
to given circumstances, such provision shall thereupon be deemed modified only
to the extent necessary to render same valid, or not applicable to given
circumstances, or excised from this Agreement, as the situation may require; and
this Agreement shall be construed and enforced as if such provision had been
included herein as so modified in scope or application, or had not been included
herein, as the case may be.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and
as of the date first set forth above.
CONNECTSOFT COMMUNICATIONS CORPORATION
By: /s/ Xxxxxx Xxxxxx
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Name: Xxxxxx Xxxxxx
Title: President and CEO
/s/ Xxxxxx X. Xxxxx
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XXXXXX X. XXXXX
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