SEVERANCE AGREEMENT
THIS AGREEMENT (this "Agreement") dated as of the ____ day of _______,
2002, is entered into by and between Xxxxxxx X. Xxxxxxx ("Xxxxxxx"), and
Infotopia Inc., a Nevada corporation (and its successors and assigns) with
principal offices at 0000 Xxxxxxxx Xxxxxxxx Xxxx, Xxxxxxxx, Xxxx ("Infotopia").
FOR AND IN CONSIDERATION of the mutual promises and covenants set forth
herein, the receipt and adequacy of which are hereby acknowledged, the parties
agree as follows:
1. Infotopia and Xxxxxxx entered into an Executive Employment Agreement
("Employment Agreement") dated 13 Aug 2001, and Infotopia and Xxxxxxx have
agreed to terminate such Employment Agreement, and provide for the settlement of
matters arising out of Xxxxxxx'x employment and termination.
2. In order to provide compensation due and payable under the
Employment Agreement Infotopia will issue to Xxxxxxx shares of Infotopia's
common stock and options to purchase additional shares of Infotopia's common
stock as described in Section 3 hereof.
3. Upon execution of this Agreement, Xxxxxxx will be issued an
aggregate of 38,000,000 shares of Infotopia's common stock, and will be issued
options to purchase 108,000,000 shares of Infotopia's common stock, at an
exercise price of $.001 per share (collectively, the "Registrable Securities");
provided, however, that in no event shall Xxxxxxx be entitled to exercise any
options when the number of shares of the common stock of Infotopia issuable upon
the exercise of the options would result in beneficial ownership by Xxxxxxx and
his affiliates of more than 9.99% of the outstanding shares of the common stock
of Infotopia. It is intended by the parties hereto that sales of the Registrable
Securities are to result in aggregate net proceeds of not less than $300,000.
4. Infotopia will, within 5 business days of this Agreement, file a
Registration Statement on Form S-8 to register the Registrable Securities.
5. As a material inducement to each party to enter into this Agreement,
and subject to the receipt of net proceeds aggregating not less than $300,000
from the sale(s) of the Registrable Securities, each of Infotopia and Xxxxxxx
agree, irrevocably and unconditionally, to release, acquit and forever discharge
the other and (if applicable), each of their owners, stockholders, predecessors,
successors, assigns, agents, directors, officers, employees, representatives,
attorneys, divisions, subsidiaries, affiliates (and the agents, directors,
officers, employees, representatives and attorneys of such parent companies,
divisions, subsidiaries and affiliates), and all persons acting by, through,
under or in concert with any of them (collectively, the "Releasees"), or any of
them, from any and all charges, complaints, claims, liabilities, obligations,
promises, agreements, controversies, damages, actions, causes of action, suits,
rights, demands, costs, losses, debts and expenses (including attorneys' fees
and costs actually incurred) of any nature whatsoever, known or unknown,
suspected or unsuspected, including, but not limited to, rights or benefits
under the Employment Agreement or any benefits as an employee,
claims in contract or tort, rights under any federal, state or local laws
regarding any forms of discrimination, and claims growing out of any legal
restriction on Infotopia's right to terminate its employees (a "Claim" or
"Claims"), which either party now has, owns, or holds, or claims to have, own or
hold, or which either Infotopia or Xxxxxxx heretofore had, owned, held, or
claimed to have had, owned or held, or which either Infotopia or Xxxxxxx at any
time hereinafter may have, own or hold, or claim to have, own or hold against
each or any of the Releasees. For the purpose of implementing a full and
complete release and discharge of the Releasees, each of Employer and Employee
expressly acknowledges that this Agreement is intended to include in its effect,
without limitation, all Claims which Infotopia or Xxxxxxx does not know or
suspect to exist in their favor at the time of execution hereof, and that this
Agreement contemplates the extinguishment of any such Claim or Claims. Xxxxxxx
represents and acknowledges that in executing this Agreement, he does not rely
and has not relied upon any representation or statement not set forth herein,
made by any of the Infotopia or by any of Infotopia's agents, representatives or
attorneys with regard to the subject matter, basis, or effect of this Agreement
or otherwise.
6. Xxxxxxx has possession of a laptop owned by Infotopia. Infotopia
transfers ownership of the laptop to Xxxxxxx upon signing of this Agreement
7. The number and kind of securities issued and issuable upon
the exercise of this Agreement including the options and the exercise price
therefore shall be subject to adjustment from time to time upon the occurrence
of certain events, as follows:
(a) Reclassification. In the case of any reclassification or
change of securities of the class issuable upon exercise of the options (other
than a change in par value, or from par value to no par value, or from no par
value to par value, or as a result of a subdivision or combination), or in case
of any merger of Infotopia with or into another corporation (other than a merger
with another corporation in which Infotopia is the acquiring and the surviving
corporation and which does not result in any reclassification or change of
outstanding securities issuable upon exercise of the options), or in case of any
sale of all or substantially all of the assets of Infotopia, Infotopia, or such
successor or purchasing corporation, as the case may be, shall duly execute and
deliver to the holder of the options new options (in form and substance
reasonably satisfactory to the holder of the options), or Infotopia shall make
appropriate provision without the issuance of new options, so that the holder of
the options shall have the right to receive, at a total purchase price not to
exceed that payable upon the exercise of the unexercised portion of the options,
and in lieu of the shares of Common Stock theretofore issuable upon exercise of
the options, (i) the kind and amount of shares of stock, other securities, money
and property receivable upon such reclassification, change, merger or sale by a
holder of the number of shares of Common Stock then purchasable under this
options, or (ii) in the case of such a merger or sale in which the consideration
paid consists all or in part of assets other than securities of the successor or
purchasing corporation, at the option of the holder of the options, the
securities of the successor or purchasing corporation having a value at the time
of the transaction equivalent to the fair market value of the Common Stock at
the time of the transaction. The provisions of this subparagraph (a) shall
similarly apply to successive reclassifications, changes, mergers and transfers.
(b) Stock Splits, Dividends and Combinations. In the event
that Infotopia shall at any time subdivide the outstanding shares of Common
Stock or shall issue a stock dividend on its outstanding shares of Common Stock,
the number of options and the shares issuable upon exercise of the options
immediately prior to such subdivision or to the issuance of such stock dividend
shall be proportionately increased, and the exercise price on the options being
issued hereto shall be proportionately decreased, and in the event that
Infotopia shall at any time combine the outstanding shares of Common Stock the
number of Shares issuable upon exercise of this options immediately prior to
such combination shall be proportionately decreased, and the exercise price on
the options being issued hereto shall be proportionately increased, effective at
the close of business on the date of such subdivision, stock dividend or
combination, as the case may be.
8. All notices, demands, requests, or other communications
required or authorized hereunder shall be deemed given sufficiently if in
writing and if personally delivered; if sent by facsimile transmission,
confirmed with a written copy thereof sent overnight express delivery; if sent
by registered mail or certified mail, return receipt requested and postage
prepaid; or if sent by overnight express delivery:
If to Xxxxxxx, to: Xxxx Xxxxxxx
XX Xxx 0000
Xxxxxx, XX 00000
Fax No. (000) 000-0000
If to Infotopia, to: Xxxxxx Xxxxx, CEO
0000 Xxxxxxxx Xxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Fax No. (000) 000-0000
or other such addresses and facsimile numbers as shall be furnished by
any party in the manner for giving notices hereunder, and any such notice,
demand, request, or other communication shall be deemed to have been given as of
the date so delivered or sent by facsimile transmission, three days after the
date so mailed, or one day after the date so sent by overnight delivery.
9. In the event legal action is brought to enforce any
provision of this Agreement, the defaulting party agrees to pay all reasonable
costs and attorneys' fees incurred by the non-defaulting party in enforcing any
remedy under this Agreement or in seeking any other remedy, whether by law or
equity.
10. This Agreement shall be governed by and interpreted in
accordance with the laws of the state of Nevada.
DATED as of the date first above written.
By:
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Xxxxxxx X. Xxxxxxx
Infotopia Inc.
By:
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Xxxxxx Xxxxx
Chief Executive Officer
