Exhibit 10.1
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into
effective as of August 1, 2004 (the "Effective Date"), by and between Innovative
Software Technologies, Inc., a California corporation (the "Employer"), and
Peter M. Peterson, an individual resident in Florida (the "Executive").
BACKGROUND:
The Company desires to employ the Executive as the Company's Chief
Executive Officer, and the Executive desires to accept such employment, on the
terms and subject to the conditions set forth in this Agreement.
AGREEMENT
The parties, intending to be legally bound, agree as follows:
1. EMPLOYMENT TERMS AND DUTIES
1.1 EMPLOYMENT. The Employer hereby employs the Executive, and the
Executive hereby accepts employment by the Employer, upon the terms and
conditions set forth in this Agreement.
1.2 TERM. Subject to the provisions of Section 5, the term of the
Executive's employment under this Agreement will be three years, beginning on
the Effective Date and ending on the third anniversary of the Effective Date.
Beginning on the Termination Date, the term of employment shall automatically
renew on a year-to-year basis (each such year being referred to as a "Renewal
Period") unless and until terminated earlier pursuant to Section 6 hereof or
until terminated by the Employer or the Executive by written notice at least 90
days before the commencement of such Renewal Period.
1.3 DUTIES. The Executive will have such duties as are assigned or
delegated to the Executive by the Board of Directors, and will initially serve
as Chief Executive Officer of the Employer. The Executive will devote his time,
attention, skill, and energy to the business of the Employer on a full-time
basis, will use his reasonable best efforts to promote the success of the
Employer's business, and will cooperate fully with the Board of Directors in the
advancement of the best interests of the Employer. Nothing in this Section 1.3,
however, will prevent the Executive from engaging in additional business
activities, personal investments and community affairs that are not inconsistent
with the Executive's duties under this Agreement. If the Executive is elected as
a director of the Employer or as a director or officer of any of its affiliates,
the Executive will fulfill his duties as such director or officer without
additional compensation.
2. COMPENSATION
2.1 BASIC COMPENSATION.
(a) Salary. The Executive will be paid an annual salary of $180,000,
subject to adjustment as provided below (the "Salary"), which will
be payable in equal periodic installments according to the
Employer's customary payroll practices, but no less frequently than
monthly. The Salary will be reviewed by the Board of Directors not
less frequently than annually, and may be adjusted upward or
downward in the sole discretion of the Board of Directors, but in no
event will the Salary be less than $150,000 per year.
(b) Signing Bonus. The Executive will be paid a Signing Bonus of $50,000
in cash within ten days of the execution of this Agreement.
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(c) Equity Grant. In consideration of Executive entering into this
Agreement, the Company shall issue to Employee 3,500,000 shares of
its common stock. Such shares will be issued in a transaction that
is exempt from the registration requirements of the Securities Act
of 1933, as amended, and such shares shall be, upon issuance,
validly issued, fully paid, and non-assessable. The certificates
representing said shares shall bear the Company's standard
restrictive legend.
(d) Benefits. The Executive will, during the Employment Period, be
permitted to participate in such pension, profit sharing, bonus,
life insurance, hospitalization, major medical or health plan, and
other employee benefit plans of the Employer that may be in effect
from time to time, to the extent the Executive is eligible under the
terms of those plans (collectively, the "Benefits").
2.2 INCENTIVE COMPENSATION. As additional compensation (the "Incentive
Compensation") for the services to be rendered by the Executive pursuant to this
Agreement, the Employer will pay the Executive with respect to each Fiscal Year
during the Employment Period according to the Company's Executive Performance
Plan to be approved by the Board of Directors as amended from time to time.
2.3 WITHHOLDING. All compensation and amounts payable to Executive
pursuant to this Agreement other than the Signing Bonus shall be subject to all
applicable taxes and payroll deductions.
3. FACILITIES AND EXPENSES
3.1 GENERAL. The Employer will furnish the Executive office space,
equipment, supplies, and such other facilities and personnel as the Employer
deems necessary or appropriate for the performance of the Executive's duties
under this Agreement. The Employer will pay the Executive's dues in such
professional societies and organizations as the Chief Executive Officer deems
appropriate, and will pay on behalf of the Executive (or reimburse the Executive
for) reasonable expenses incurred by the Executive at the request of, or on
behalf of, the Employer in the performance of the Executive's duties pursuant to
this Agreement, and in accordance with the Employer's employment policies,
including reasonable expenses incurred by the Executive in attending
conventions, seminars, and other business meetings, in appropriate business
entertainment activities, and for promotional expenses. The Executive must file
expense reports with respect to such expenses in accordance with the Employer's
policies.
3.2 AUTOMOBILE. The Employer will provide the Executive $800 per month as
an automobile allowance. The Executive will own or lease his automobile directly
and will maintain and insure it at his own expense, for his business use in
connection with his employment under this Agreement
4. VACATIONS AND HOLIDAYS
The Executive will be entitled to four weeks of paid vacation each Fiscal
Year in accordance with the vacation policies of the Employer in effect for its
executive officers as modified from time to time. Vacation must be taken by the
Executive at such time or times as approved by the Chairman of the Board or
Chief Executive Officer. The Executive will also be entitled to the paid
holidays and other paid leave set forth in the Employer's policies. Vacation
days and holidays during any Fiscal Year that are not used by the Executive
during such Fiscal Year may not be used in any subsequent Fiscal Year.
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5. TERMINATION
5.1 EVENTS OF TERMINATION. The Employment Period, the Executive's Basic
Compensation and Incentive Compensation, and any and all other rights of the
Executive under this Agreement or otherwise as an employee of the Employer will
terminate (except as otherwise provided in this Section 5):
(a) upon the death of the Executive;
(b) upon the disability of the Executive (as defined in Section 5.2)
immediately upon notice from either party to the other;
(c) for cause (as defined in Section 5.3), immediately upon notice from
the Employer to the Executive, or at such later time as such notice
may specify; or
(d) for good reason (as defined in Section 5.4) upon not less than
thirty days' prior notice from the Executive to the Employer.
In addition to the other termination provisions of this Agreement Employer
may terminate the Employee's employment without Cause at any time.
5.2 DEFINITION OF DISABILITY. For purposes of Section 5.1, the Executive
will be deemed to have a "disability" if, for physical or mental reasons, the
Executive is unable to perform the Executive's duties under this Agreement for
120 consecutive days, or 180 days during any twelve-month period, as determined
in accordance with this Section 5.2. The disability of the Executive will be
determined by a medical doctor selected by written agreement of the Employer and
the Executive upon the request of either party by notice to the other. If the
Employer and the Executive cannot agree on the selection of a medical doctor,
each of them will select a medical doctor and the two medical doctors will
select a third medical doctor who will determine whether the Executive has a
disability. The determination of the medical doctor selected under this Section
5.2 will be binding on both parties. The Executive must submit to a reasonable
number of examinations by the medical doctor making the determination of
disability under this Section 5.2, and the Executive hereby authorizes the
disclosure and release to the Employer of such determination and all supporting
medical records. If the Executive is not legally competent, the Executive's
legal guardian or duly authorized attorney-in-fact will act in the Executive's
stead, under this Section 5.2, for the purposes of submitting the Executive to
the examinations, and providing the authorization of disclosure, required under
this Section 5.2.
5.3 DEFINITION OF "FOR CAUSE." For purposes of Section 5.1, the phrase
"for cause" means: (a) the Executive's material breach of this Agreement if
Executive has been given a reasonable opportunity to comply with such policy or
cure his failure to comply (which reasonable opportunity must be granted during
the thirty-day period preceding termination of this Agreement; (b) the
Executive's failure to adhere to any written Employer policy if the Executive
has been given a reasonable opportunity to comply with such policy or cure his
failure to comply (which reasonable opportunity must be granted during the
fifteen-day period preceding termination of this Agreement); (c) the
appropriation (or attempted appropriation) of a material business opportunity of
the Employer, including attempting to secure or securing any personal profit in
connection with any transaction entered into on behalf of the Employer; (d) the
misappropriation (or attempted misappropriation) of any of the Employer's funds
or property; or (e) the conviction of, (or its procedural equivalent), or the
entering of a guilty plea or plea of no contest with respect to, a felony, the
equivalent thereof, or any other crime with respect to which imprisonment is a
possible punishment. Termination for cause shall be effected only through a vote
of the majority of the board of directors.
5.4 DEFINITION OF "FOR GOOD REASON." For purposes of Section 5.1, the
phrase "for good reason" means any of the following: (a) The Employer's material
breach of this Agreement; (b) the assignment of the Executive without his
consent to a position, responsibilities, or duties of a materially lesser status
or degree of responsibility than his position, responsibilities, or duties at
the Effective Date; or (c) the relocation of the Employer's principal executive
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offices outside the metropolitan Tampa Bay, Florida area; (d) the requirement by
the Employer that the Executive be based anywhere other than the Employer's
principal executive offices, in either case without the Executive's consent, or
(e) a Change in Control of the Employer.
5.5 TERMINATION PAY. Effective upon the termination of this Agreement, the
Employer will be obligated to pay the Executive (or, in the event of his death,
his designated beneficiary as defined below) only such compensation as is
provided in this Section 5.5. For purposes of this Section 5.5, the Executive's
designated beneficiary will be such individual beneficiary or trust, located at
such address, as the Executive may designate by notice to the Employer from time
to time or, if the Executive fails to give notice to the Employer of such a
beneficiary, the Executive's estate. Notwithstanding the preceding sentence, the
Employer will have no duty, in any circumstances, to attempt to open an estate
on behalf of the Executive, to determine whether any beneficiary designated by
the Executive is alive or to ascertain the address of any such beneficiary, to
determine the existence of any trust, to determine whether any person or entity
purporting to act as the Executive's personal representative (or the trustee of
a trust established by the Executive) is duly authorized to act in that
capacity, or to locate or attempt to locate any beneficiary, personal
representative, or trustee.
(a) Termination by the Executive for Good Reason or by the Employer
without Cause. If the Executive terminates this Agreement for good
reason, or if the Employer terminates the Employee without Cause,
the Employer will pay the Executive (i) the Executive's Salary for
the remainder, if any, of the calendar month in which such
termination is effective and for twelve consecutive calendar months
thereafter, and (ii) that portion of the Executive's Incentive
Compensation, if any, for the Fiscal Year during which the
termination is effective, prorated through the date of termination.
(b) Termination by the Employer for Cause. If the Employer terminates
this Agreement for cause, the Executive will be entitled to receive
his Salary only through the date such termination is effective, but
will not be entitled to any Incentive Compensation for the Fiscal
Year during which such termination occurs or any subsequent Fiscal
Year.
(c) Termination upon Disability. If this Agreement is terminated by
either party as a result of the Executive's disability, as
determined under Section 5.2, the Employer will pay the Executive
his Salary through the remainder of the calendar month during which
such termination is effective and for the lesser of (i) six
consecutive months thereafter, or (ii) the period until disability
insurance benefits commence under the disability insurance coverage
furnished by the Employer to the Executive.
(d) Termination upon Death. If this Agreement is terminated because of
the Executive's death, the Executive will be entitled to receive his
Salary through the end of the calendar month in which his death
occurs, and that part of the Executive's Incentive Compensation, if
any, for the Fiscal Year during which his death occurs, prorated
through the end of the calendar month during which his death occurs.
(e) Benefits. The Executive's accrual of, or participation in plans
providing for, the Benefits will cease at the effective date of the
termination of this Agreement, and the Executive will be entitled to
accrued Benefits pursuant to such plans only as provided in such
plans. The Executive will not receive, as part of his termination
pay pursuant to this Section 5, any payment or other compensation
for any vacation, holiday, sick leave, or other leave unused on the
date the notice of termination is given under this Agreement.
6. NON-DISCLOSURE COVENANT; EMPLOYEE INVENTIONS
6.1 ACKNOWLEDGMENTS BY THE EXECUTIVE. The Executive acknowledges that (a)
during the Employment Period and as a part of his employment, the Executive will
be afforded access to Confidential Information; (b) public disclosure of such
Confidential Information could have an adverse effect on the Employer and its
business; (c) because
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the Executive possesses substantial technical expertise and skill with respect
to the Employer's business, the Employer desires to obtain exclusive ownership
of each Employee Invention, and the Employer will be at a substantial
competitive disadvantage if it fails to acquire exclusive ownership of each
Employee Invention; (d) the Employer has required that the Executive make the
covenants in this Section 6 as a condition to employment; and (e) the provisions
of this Section 6 are reasonable and necessary to prevent the improper use or
disclosure of Confidential Information and to provide the Employer with
exclusive ownership of all Employee Inventions.
6.2 AGREEMENTS OF THE EXECUTIVE. In consideration of the compensation and
benefits to be paid or provided to the Executive by the Employer under this
Agreement, the Executive covenants as follows:
(a) Confidentiality.
(i) During and at all times following the Employment Period, the
Executive will hold in confidence the Confidential Information
and will not disclose it to any person except with the
specific prior written consent of the Employer or except as
otherwise expressly permitted by the terms of this Agreement.
(ii) Any trade secrets of the Employer will be entitled to all of
the protections and benefits under applicable state or federal
law including trade secret law. If any information that the
Employer deems to be a trade secret is found by a court of
competent jurisdiction not to be a trade secret for purposes
of this Agreement, such information will, nevertheless, be
considered Confidential Information for purposes of this
Agreement. The Executive hereby waives any requirement that
the Employer submit proof of the economic value of any trade
secret or post a bond or other security.
(iii) None of the foregoing obligations and restrictions applies to
any part of the Confidential Information that the Executive
demonstrates was or became generally available to the public
other than as a result of a disclosure by the Executive.
(iv) The Executive will not remove from the Employer's premises
(except to the extent such removal is for purposes of the
performance of the Executive's duties at home or while
traveling, or except as otherwise specifically authorized by
the Employer) any document, record, notebook, plan, model,
component, device, data, or computer software or code, whether
embodied in a disk or in any other form (collectively, the
"Proprietary Items"). The Executive recognizes that, as
between the Employer and the Executive, all of the Proprietary
Items, whether or not developed by the Executive, are the
exclusive property of the Employer. Upon termination of this
Agreement by either party, or upon the request of the Employer
during the Employment Period, the Executive will return to the
Employer all of the Proprietary Items in the Executive's
possession or subject to the Executive's control, and the
Executive shall not retain any copies, abstracts, sketches, or
other physical or electronic embodiment of any of the
Proprietary Items.
(b) Employee Inventions. Each Employee Invention will belong exclusively
to the Employer. The Executive acknowledges that all of the
Executive's writing, works of authorship, and other Employee
Inventions are works made for hire and the property of the Employer,
including any copyrights, patents, semiconductor mask protection, or
other intellectual property rights pertaining thereto. If it is
determined that any such works are not works made for hire, the
Executive hereby assigns to the Employer all of the Executive's
right, title, and interest, including all rights of copyright,
patent, semiconductor mask protection, and other intellectual
property rights, to or in such Employee Inventions. The Executive
covenants that he will promptly:
(i) disclose to the Employer in writing any Employee Invention;
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(ii) assign to the Employer or to a party designated by the
Employer, at the Employer's request and without additional
compensation, all of the Executive's right to the Employee
Invention for the United States and all foreign jurisdictions;
(iii) execute and deliver to the Employer such applications,
assignments, and other documents as the Employer may request
in order to apply for and obtain patents or other
registrations with respect to any Employee Invention in the
United States and any foreign jurisdictions;
(iv) sign all other papers necessary to carry out the above
obligations; and
(v) give testimony and render any other assistance but without
expense to the Executive in support of the Employer's rights
to any Employee Invention.
6.3 DISPUTES OR CONTROVERSIES. The Executive recognizes that should a
dispute or controversy arising from or relating to this Agreement be submitted
for adjudication to any court, arbitration panel, or other third party, the
preservation of the secrecy of Confidential Information may be jeopardized. All
pleadings, documents, testimony, and records relating to any such adjudication
will be maintained in secrecy and will be available for inspection by the
Employer, the Executive, and their respective attorneys and experts, who will
agree, in advance and in writing, to receive and maintain all such information
in secrecy, except as may be limited by them in writing.
7. NON-COMPETITION AND NON-INTERFERENCE
7.1 ACKNOWLEDGMENTS BY THE EXECUTIVE. The Executive acknowledges that: (a)
the services to be performed by him under this Agreement are of a special,
unique, unusual, extraordinary, and intellectual character; (b) the Employer's
business is national in scope and its products are marketed throughout the
United States and Canada; (c) the Employer competes with other businesses that
are or could be located in any part of the United States or Canada; (d) the
Employer has required that the Executive make the covenants set forth in this
Section 7 as a condition to employment by Employer; and (e) the provisions of
this Section 7 are reasonable and necessary to protect the Employer's business.
7.2 COVENANTS OF THE EXECUTIVE. In consideration of the acknowledgments by
the Executive, and in consideration of the compensation and benefits to be paid
or provided to the Executive by the Employer, the Executive covenants that he
will not, directly or indirectly:
(a) during the Employment Period, except in the course of his employment
hereunder, and during the Post-Employment Period, engage or invest
in, own, manage, operate, finance, control, or participate in the
ownership, management, operation, financing, or control of, be
employed by, associated with, or in any manner connected with, lend
the Executive's name or any similar name to, lend Executive's credit
to or render services or advice to, any business whose products or
activities compete in whole or in part with the products or
activities of the Employer
(b) whether for the Executive's own account or for the account of any
other person, at any time during the Employment Period and the
Post-Employment Period, solicit business of the same or similar type
being carried on by the Employer, from any person known by the
Executive to be a customer of the Employer, whether or not the
Executive had personal contact with such person during and by reason
of the Executive's employment with the Employer;
(c) whether for the Executive's own account or the account of any other
person (i) at any time during the Employment Period and the
Post-Employment Period, solicit, employ, or otherwise engage as an
employee, independent contractor, or otherwise, any person who is or
was an employee of the Employer at any time during the Employment
Period or in any manner induce or attempt to induce any
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employee of the Employer to terminate his employment with the
Employer; or (ii) at any time during the Employment Period and for
three years thereafter, interfere with the Employer's relationship
with any person, including any person who at any time during the
Employment Period was an employee, contractor, supplier, or customer
of the Employer; or
(d) at any time during or after the Employment Period, disparage the
Employer or any of its shareholders, directors, officers, employees,
or agents.
For purposes of this Section 7.2, the term "Post-Employment Period" means
the one year period beginning on the date of termination of the Executive's
employment with the Employer.
If any covenant in this Section 7.2 is held to be unreasonable, arbitrary,
or against public policy, such covenant will be considered to be divisible with
respect to scope, time, and geographic area, and such lesser scope, time, or
geographic area, or all of them, as a court of competent jurisdiction may
determine to be reasonable, not arbitrary, and not against public policy, will
be effective, binding, and enforceable against the Executive.
The period of time applicable to any covenant in this Section 7.2 will be
extended by the duration of any violation by the Executive of such covenant.
The Executive will, while the covenant under this Section 7.2 is in
effect, give notice to the Employer, within ten days after accepting any other
employment, of the identity of the Executive's employer. The Employer may notify
such employer that the Executive is bound by this Agreement and, at the
Employer's election, furnish such employer with a copy of this Agreement or
relevant portions thereof.
8. GENERAL PROVISIONS
8.1 INJUNCTIVE RELIEF AND ADDITIONAL REMEDY. The Executive acknowledges
that the injury that would be suffered by the Employer as a result of a breach
of the provisions of this Agreement (including any provision of Sections 6 and
7) would be irreparable and that an award of monetary damages to the Employer
for such a breach would be an inadequate remedy. Consequently, the Employer will
have the right, in addition to any other rights it may have, to obtain
injunctive relief to restrain any breach or threatened breach or otherwise to
specifically enforce any provision of this Agreement, and the Employer will not
be obligated to post bond or other security in seeking such relief. Without
limiting the Employer's rights under this Section 8 or any other remedies of the
Employer, if the Executive breaches any of the provisions of Section 6 or 7, the
Employer will have the right to cease making any payments otherwise due to the
Executive under this Agreement.
8.2 COVENANTS OF SECTIONS 6 AND 7 ARE ESSENTIAL AND INDEPENDENT COVENANTS.
The covenants by the Executive in Sections 6 and 7 are essential elements of
this Agreement, and without the Executive's agreement to comply with such
covenants, Employer would not have entered into this Agreement or employed or
continued the employment of the Executive. The Employer and the Executive have
independently consulted their respective counsel and have been advised in all
respects concerning the reasonableness and propriety of such covenants, with
specific regard to the nature of the business conducted by the Employer.
The Executive's covenants in Sections 6 and 7 are independent covenants
and the existence of any claim by the Executive against the Employer under this
Agreement or otherwise, or against the Buyer, will not excuse the Executive's
breach of any covenant in Section 6 or 7.
If the Executive's employment hereunder expires or is terminated, this
Agreement will continue in full force and effect as is necessary or appropriate
to enforce the covenants and agreements of the Executive in Sections 6 and 7.
8.3 REPRESENTATIONS AND WARRANTIES BY THE EXECUTIVE. The Executive
represents and warrants to the Employer that the execution and delivery by the
Executive of this Agreement does not, and the performance by the
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Executive of the Executive's obligations hereunder will not, with or without the
giving of notice or the passage of time, or both: (a) violate any judgment,
writ, injunction, or order of any court, arbitrator, or governmental agency
applicable to the Executive; or (b) conflict with, result in the breach of any
provisions of or the termination of, or constitute a default under, any
agreement to which the Executive is a party or by which the Executive is or may
be bound.
8.4 OBLIGATIONS CONTINGENT ON PERFORMANCE. The obligations of the Employer
hereunder, including its obligation to pay the compensation provided for herein,
are contingent upon the Executive's performance of the Executive's obligations
hereunder.
8.5 WAIVER. The rights and remedies of the parties to this Agreement are
cumulative and not alternative. Neither the failure nor any delay by either
party in exercising any right, power, or privilege under this Agreement will
operate as a waiver of such right, power, or privilege, and no single or partial
exercise of any such right, power, or privilege will preclude any other or
further exercise of such right, power, or privilege or the exercise of any other
right, power, or privilege. To the maximum extent permitted by applicable law,
(a) no claim or right arising out of this Agreement can be discharged by one
party, in whole or in part, by a waiver or renunciation of the claim or right
unless in writing signed by the other party; (b) no waiver that may be given by
a party will be applicable except in the specific instance for which it is
given; and (c) no notice to or demand on one party will be deemed to be a waiver
of any obligation of such party or of the right of the party giving such notice
or demand to take further action without notice or demand as provided in this
Agreement.
8.6 BINDING EFFECT; DELEGATION OF DUTIES PROHIBITED. This Agreement shall
inure to the benefit of, and shall be binding upon, the parties hereto and their
respective successors, assigns, heirs, and legal representatives, including any
entity with which the Employer may merge or consolidate or to which all or
substantially all of its assets may be transferred. The duties and covenants of
the Executive under this Agreement, being personal, may not be delegated.
8.7 NOTICES. All notices, consents, waivers, and other communications
under this Agreement must be in writing and will be deemed to have been duly
given when (a) delivered by hand (with written confirmation of receipt), (b)
sent by facsimile (with written confirmation of receipt), provided that a copy
is mailed by registered mail, return receipt requested, or (c) when received by
the addressee, if sent by a nation-ally recognized overnight delivery service
(receipt requested), in each case to the appropriate addresses and facsimile
numbers set forth below (or to such other addresses and facsimile numbers as a
party may designate by notice to the other parties):
If to Employer: Innovative Software Technologies, Inc.
204 NW Platte Valley Drive
Riverside, MO 64152
Attention: D. Shane Hackett, President and CEO
Facsimile No.: (816) 587-0683
With a copy to: Foley & Lardner LLP
100 North Tampa Street, Suite 2700
Tampa, FL 33602
Attention: Curt P. Creely, Esq.
Facsimile No.: 813.221.4210
If to the Executive: Peter M. Peterson
2402 South Ardson Place
Tampa, FL 33629
Facsimile No.: (813) 254-8406
8.8 ENTIRE AGREEMENT; AMENDMENTS. This Agreement contains the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings, oral or written, between
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the parties hereto with respect to the subject matter hereof. This Agreement may
not be amended orally, but only by an agreement in writing signed by the parties
hereto.
8.9 GOVERNING LAW. This Agreement will be governed by the laws of the
State of Florida without regard to conflicts of laws principles.
8.10 JURISDICTION. Any action or proceeding seeking to enforce any
provision of, or based on any right arising out of, this Agreement may be
brought against either of the parties in the courts of the State of Florida
County of Hillsborough, or, if it has or can acquire jurisdiction, in the United
States District Court for the Middle District of Florida, and each of the
parties consents to the jurisdiction of such courts (and of the appropriate
appellate courts) in any such action or proceeding and waives any objection to
venue laid therein. Process in any action or proceeding referred to in the
preceding sentence may be served on either party anywhere in the world.
8.11 SECTION HEADINGS, CONSTRUCTION. The headings of Sections in this
Agreement are provided for convenience only and will not affect its construction
or interpretation. All references to "Section" or "Sections" refer to the
corresponding Section or Sections of this Agreement unless otherwise specified.
All words used in this Agreement will be construed to be of such gender or
number as the circumstances require. Unless otherwise expressly provided, the
word "including" does not limit the preceding words or terms.
8.12 SEVERABILITY. If any provision of this Agreement is held invalid or
unenforceable by any court of competent jurisdiction, the other provisions of
this Agreement will remain in full force and effect. Any provision of this
Agreement held invalid or unenforceable only in part or degree will remain in
full force and effect to the extent not held invalid or unenforceable.
8.13 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement.
8.14 WAIVER OF JURY TRIAL. THE PARTIES HERETO HEREBY WAIVE A JURY TRIAL IN
ANY LITIGATION WITH RESPECT TO THIS AGREEMENT.
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
as of the date above first written above.
EMPLOYER: EXECUTIVE:
By: /s/ D. Shane Hackett /s/ Peter M. Peterson
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D. Shane Hackett, President & CEO Peter M. Peterson
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EXHIBIT A
DEFINITIONS
"AGREEMENT"--this Employment Agreement, including this Exhibit A hereto, as
amended from time to time.
"BASIC COMPENSATION"--Salary and Benefits.
"BENEFITS"--as defined in Section 2.1(d).
"BOARD OF DIRECTORS"--the board of directors of the Employer.
"CHANGE IN CONTROL"--shall be deemed to have occurred upon the happening of any
one of the following events:
a. any person, entity, or group thereof acting in concert (a "Person")
(other than (A) the Employee, or any "affiliate" (as defined in Rule
12b-2 of the Securities Exchange Act of 1934) of any of the
foregoing, (B) the Company or any of its subsidiaries, (C) a trustee
or other fiduciary holding securities under any employee benefit
plan of the Company or any of its subsidiaries, (D) an underwriter
temporarily holding securities pursuant to an offering of such
securities or (E) a corporation owned, directly or indirectly, by
the stockholders of the Company in substantially the same
proportions as their ownership of stock in the Company) being or
becoming the "beneficial owner" (as such term is defined in Rule
13d-3 under the Securities Exchange Act of 1934) of securities of
the Company which, together with securities previously owned, confer
upon such Person the combined voting power, on any matters brought
to a vote of shareholders, of 50% or more of the then outstanding
shares of voting securities of the Company; or
b. the sale, assignment or transfer of assets of the Company or any
subsidiary or subsidiaries, in a transaction or series of
transactions, if the aggregate consideration received or to be
received by the Company or any such subsidiary in connection with
such sale, assignment or transfer is greater than fifty percent
(50%) of the book value, determined by the Company in accordance
with generally accepted accounting principles, of the Company's
assets determined on a consolidated basis immediately before such
transaction or the first of such transactions; or
c. the merger, consolidation, share exchange or reorganization of the
Company (or one or more direct or indirect subsidiaries of the
Company) as a result of which the holders of all of the shares of
capital stock of the Company as a group would receive fifty percent
(50%) or less of the combined voting power of the voting securities
of the Company or such surviving or resulting entity or any parent
thereof immediately after such merger, consolidation, share exchange
or reorganization; or
d. the adoption of a plan of complete liquidation or the approval of
the dissolution of the Company; or
e. the commencement (within the meaning of Rule 13e-4 under the
Securities Exchange Act of 1934) of a tender or exchange offer
which, if successful, would result in a Change of Control of the
Company; or
f. a determination by the Board of Directors of the Company, in view of
the then current circumstances or impending events, that a Change of
Control of the Company has occurred or is imminent, which
determination shall be made for the specific purpose of triggering
the operative provisions of this Agreement.
"CONFIDENTIAL INFORMATION"--any and all:
a. trade secrets concerning the business and affairs of the Employer,
product specifications, data, know-how, formulae, compositions,
processes, designs, sketches, photographs, graphs, drawings,
samples, inventions and ideas, past, current, and planned research
and development, current and planned manufacturing or distribution
methods and processes, customer lists, current and anticipated
customer requirements, price lists, market
A-1
Initials _________ _________
Executive Employer
studies, business plans, computer software and programs (including
object code and source code), computer software and database
technologies, databases, systems, structures, and architectures (and
related formulae, compositions, processes, improvements, devices,
know-how, inventions, discoveries, concepts, ideas, designs, methods
and information), and any other information, however documented,
that is a trade secret within the meaning of the Florida Uniform
Trade Secrets Act; and
b. information concerning the business and affairs of the Employer
(which includes historical financial statements, financial
projections and budgets, historical and projected sales, capital
spending budgets and plans, the names and backgrounds of key
personnel, personnel training and techniques and materials), however
documented except as disclosed by Employer to the public; and
c. notes, analysis, compilations, studies, summaries, and other
material prepared by or for the Employer containing or based, in
whole or in part, on any information included in the foregoing.
"DISABILITY"--as defined in Section 5.2.
"EFFECTIVE DATE"--the date stated in the first paragraph of the Agreement.
"EMPLOYEE INVENTION"--any idea, invention, technique, modification, process, or
improvement (whether patentable or not), any industrial design (whether
registerable or not), any mask work, however fixed or encoded, that is suitable
to be fixed, embedded or programmed in a semiconductor product (whether
recordable or not), and any work of authorship (whether or not copyright
protection may be obtained for it) created, conceived, or developed by the
Executive, either solely or in conjunction with others, during the Employment
Period, or a period that includes a portion of the Employment Period, that
relates directly to the business then being conducted or proposed to be
conducted by the Employer, and any such item created by the Executive, either
solely or in conjunction with others, following termination of the Executive's
employment with the Employer, that is based upon or uses Confidential
Information.
"EMPLOYMENT PERIOD"--the term of the Executive's employment under this
Agreement.
"FISCAL YEAR"--the Employer's fiscal year, as it exists on the Effective Date or
as changed from time to time.
"FOR CAUSE"--as defined in Section 5.3.
"FOR GOOD REASON"--as defined in Section 5.4.
"INCENTIVE COMPENSATION"--as defined in Section 2.2.
"NONCOMPETITION AGREEMENT"--as defined in Section 7.
"PERSON"--any individual, corporation (including any non-profit corporation),
general or limited partnership, limited liability company, joint venture,
estate, trust, association, organization, or governmental body.
"POST-EMPLOYMENT PERIOD"--as defined in Section 7.2.
"PROPRIETARY ITEMS"--as defined in Section 6.2(a)(iv).
"SALARY"--as defined in Section 2.1(a).
A-2
Initials _________ _________
Executive Employer