EXHIBIT 10.10
AGREEMENT
This AGREEMENT (hereinafter referred to as the "Agreement") is entered into
on June 4, 2003 (hereinafter the "Effective Date"), by and between Compass
Knowledge Holdings, Inc. (hereinafter referred to as "Compass") and ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇, ▇▇. (hereinafter referred to as "▇▇▇▇▇▇").
WITNESSETH:
WHEREAS, Compass and ▇▇▇▇▇▇ entered into an Amended and Restated Employment
Agreement effective on or about November 1, 1999, whereby ▇▇▇▇▇▇ presently
serves as Chief Executive Officer of Compass (hereinafter the "Employment
Agreement"). A copy of the Employment Agreement is attached hereto as Exhibit
"A" and by this reference incorporated herein and made a material part hereof;
and
WHEREAS, ▇▇▇▇▇▇ desires to resign from his position as an officer and
Chairman of the Board of Directors of Compass and terminate the Employment
Agreement contemporaneous with same and Compass has agreed to accept such
resignation and to terminate the Employment Agreement;
WHEREAS, the parties desire to memorialize the terms of their agreement by
entering into this Agreement.
NOW, THEREFORE, in consideration of the promises and undertakings contained
herein, and other good and valuable consideration, the receipt and adequacy of
which is acknowledged, Compass and ▇▇▇▇▇▇ agree as follows:
1. Recitals. The foregoing recitals are true and correct in all material
respects and by this reference incorporated herein and made a material part
hereof.
2. Termination of Employment. The parties hereby agree that effective as of
May 31, 2003, the Employment Agreement and ▇▇▇▇▇▇'▇ employment with Compass
pursuant thereto shall be effectively terminated (the "Termination Date").
As of the Termination Date, neither party shall thereafter have any rights,
duties, obligations, and/or claims with respect to each other except as
otherwise specifically provided herein.
3. Certain Covenants and Undertakings. Notwithstanding the foregoing
termination, the parties hereby agree as follows:
A. Transition Assistance. ▇▇▇▇▇▇ agrees to be reasonably available
without additional compensation for so long as he may be reasonably
needed in person, telephonically and through email to discuss, provide
information, data, direction, and help that may be reasonably
requested of him in order to educate, train, inform and generally
continue to facilitate the transition of his work and the information
he may hold regarding same to Compass and its designees (the
"Transition Services"). It is contemplated that in connection with
such Transition Services ▇▇▇▇▇▇ will provide Compass and its
designated employees, personnel and agents with:
(i) All information, files, folders, documents, data, assumptions,
projections, assumptions, theories, formulas and assistance with
respect to Compass' business matters;
(ii) All information, files, folders, documents, data, assumptions,
formulas and assistance with respect to all Compass' contracts and
agreements for which he negotiated, executed, has information
regarding or was otherwise involved;
(iii) All information, files, folders, documents, data, assumptions,
formulas, projections, theories, and assistance with respect to all
Compass' budgets and projections for which he has information
regarding or was otherwise involved; and
(iv) All information, files, folders, documents, data, formulas and
assistance with respect to all prospective third party opportunities,
agreements, discussions and/or understandings.
a. Accrued Compensation, Benefits and Options. (i) Compass agrees to: (x)
pay ▇▇▇▇▇▇ his annual base salary as described and in accordance with
the provisions of Section 3.1 of the Employment Agreement through the
Termination Date; (y) provide ▇▇▇▇▇▇ with the benefits described and
in accordance with Section 3.4 of the Employment Agreement through the
Termination Date; and (z) pay ▇▇▇▇▇▇ as soon as is reasonably possible
(which shall not occur until Compass has sufficient cash reserves
after considering its other obligations and operating needs) all
accrued but unpaid bonuses in the amount of $62,716.60 (the
"Bonuses"). It is agreed by the parties that Compass will use its
reasonable best efforts to pay (provided Compass has sufficient cash
reserves after considering its other obligations and operating needs)
at least 50% of such Bonuses on or before December 31, 2003 and the
remaining 50% on or before March 1, 2004.
(ii) Compass agrees to reimburse ▇▇▇▇▇▇ through the Termination Date
for all proper expenses he has incurred on behalf of Compass in
accordance with the provisions of Section 4.1 of the Employment
Agreement.
(iii) Compass hereby acknowledges and agrees that all prior options
granted to ▇▇▇▇▇▇ (265,118) shall be fully vested and that such
options shall expire, unless otherwise exercised, on December 31, 2003
notwithstanding anything to the contrary in Compass' Option Plan or
the Option Agreement with ▇▇▇▇▇▇.
b. Relocation. ▇▇▇▇▇▇ agrees to use his best efforts to remove his
personal effects from his Compass' office and relocate his office as
soon as possible, but in no event later than 60 days from the date of
this Agreement. Compass agrees to deliver, assign and transfer
ownership to ▇▇▇▇▇▇ of the computer and cell phone which he is
presently using.
▇. ▇▇▇▇▇▇▇▇▇ Award.
It is understood and agreed that as of the Termination Date, Compass
unconditionally owes ▇▇▇▇▇▇ the sum of $294,491.74 (which includes,
without limitation, all compensation, benefit and expense payments
otherwise required to be paid to him under the terms of his Employment
Agreement). Such amount shall hereinafter be known as the "Severance
Award." Compass hereby agrees to pay
▇▇▇▇▇▇ the ▇▇▇▇▇▇▇▇▇ Award in thirty-four (34) equal bi-monthly
payments of $8,661.52 on the 15th and last day of each month beginning
June 15, 2003 and ending October 31, 2004 (the "Payment Schedule").
Notwithstanding the Payment Schedule, in the event that a transaction
is consummated at anytime during the term of this Agreement between
Compass and an Opportunity (as defined below) identified and
introduced to Compass by ▇▇▇▇▇▇ and in connection with the
consummation of such transaction there is sufficient cash resources
available to Compass as provided by such Opportunity after considering
its other obligations and reasonable operating reserves, as determined
by Compass, then, in such event, the payment of the foregoing
Severance Award that would otherwise be payable to ▇▇▇▇▇▇ in
accordance with the Payment Schedule shall be accelerated and paid to
▇▇▇▇▇▇, to the extent reasonably possible. In determining the amount
of such accelerated payment that Compass will pay ▇▇▇▇▇▇, assuming
sufficient cash resources are available considering other obligations
and reasonable operating reserves of Compass, the following formula
shall apply:
(i) 5% on such portion of the consideration actually paid to or
received by Compass (including purchase money consideration, capital
infusions, and/or fees, but excluding lines of credit or any other
debt) from the Opportunity (hereinafter the "Consideration") which
does not exceed $1,000,000.00;
(ii) 4% of such portion of the Consideration which exceeds
$1,000,000.00 but does not exceed $2,000,000.00;
(iii) 3% of such portion of the Consideration which exceeds
$2,000,000.00 but does not exceed $3,000,000.00;
(iv) 2% of such portion of the Consideration which exceeds
$3,000,000.00 but does not exceed $4,000,000.00; and
(v) 1% of such portion of the Consideration which exceeds
$5,000,000.00.
The parties recognize and agree that the accelerated payment shall be
made, if at all, within 30 days of the actual receipt by Compass of
the foregoing Consideration and that in no event shall such payment
exceed the amount of the Severance Award that ▇▇▇▇▇▇ would otherwise
be entitled to receive under the terms of this Agreement.
For these purposes, an "Opportunity" shall mean any businesses,
service or product providers, capital funding sources and other
prospects that ▇▇▇▇▇▇ introduces to Compass and which Compass enters
into a binding agreement with.
Compass agrees to reimburse ▇▇▇▇▇▇ for all other reasonable,
pre-approved expenses incurred by ▇▇▇▇▇▇ in identifying and
introducing such Opportunities to Compass, subject to ▇▇▇▇▇▇'▇ full
and appropriate documentation, including, without limitation, receipts
for all such expenses in the manner required pursuant to Compass's
policies and procedures and the Internal Revenue Code of 1986, as
amended (the "Code") and applicable regulations as are in effect from
time to time.
4. No Other Obligations. Except as otherwise specifically provided pursuant to
this Agreement, ▇▇▇▇▇▇ shall not be entitled to any additional
compensation, bonuses, options, benefits, severance payments,
reimbursements and/or any other payments of any kind whatsoever.
5. Survival Clauses. Except as otherwise specifically provided in this
Agreement, the Employment Agreement shall be of no further force or effect
as of the Termination Date. Notwithstanding the foregoing, the parties
hereby agree that the survival covenants contained in Article XII of the
Employment Agreement as they pertain to Articles VI, VIII, and IX (with the
understanding that notwithstanding Article IX of the Employment Agreement,
Compass' directors and officers' insurance is only for $1,000,000 with
$50,000 deductible) shall survive the termination of the Employment
Agreement and the execution and closing of this Agreement.
6. Releases. (a) ▇▇▇▇▇▇, on behalf of himself and his successors, heirs,
executors, administrators, representatives, affiliates, agents and assigns,
fully and unconditionally forever releases and discharges Compass, its
parent company and their officers, directors, successors, assigns,
affiliates, and subsidiaries (hereinafter the "Compass Releasees") from any
and all claims, demands, manners of action, causes of action, damages,
judgments, agreements, demands, debts or liabilities whatsoever whether
known or unknown, suspected or unsuspected, both at law and in equity,
which ▇▇▇▇▇▇ now has, has ever had or will hereafter acquire against
Compass Releasees with respect to activities arising from, out of or
otherwise in connection with ▇▇▇▇▇▇'▇ employment with Compass or arising
from, out of or otherwise in connection with any other matter, cause or
event including, but not limited to, any compensation, wages, salary,
bonuses, vacation pay, sick pay, disability pay, unemployment claims or
benefits, expense reimbursements, severance or termination awards and
claims, insurance benefits, and any other benefits; provided, however, that
nothing contained herein shall operate to release Compass from its
obligations as set forth in this Agreement or any intentional wrongful act
or omission by Compass.
In furtherance of the foregoing, ▇▇▇▇▇▇ hereby irrevocably covenants to
refrain from, directly or indirectly, asserting any claim or demand, or
commencing, instituting or causing to be commenced, any proceeding of any
kind against any Compass Releasee, based upon any matter purported to be
released hereby.
(b) Compass on behalf of itself and its subsidiaries, successors,
affiliates, agents and assigns, fully and unconditionally forever releases
and discharges ▇▇▇▇▇▇ and his heirs, executors, administrators, and
representatives (hereinafter "▇▇▇▇▇▇ Releasees") from any and all claims,
demands, manners of action, causes of action, damages, judgments,
agreements, demands, debts or liabilities whatsoever whether known or
unknown, suspected or unsuspected, both at law and in equity, which Compass
now has or has ever had against ▇▇▇▇▇▇ Releasees with respect to activities
arising from, out of or otherwise in connection with ▇▇▇▇▇▇'▇ employment
with Compass except as otherwise provided herein and provided, that nothing
contained herein shall operate to release ▇▇▇▇▇▇ from his obligations
pursuant to this Agreement or any intentional wrongful act or omission by
▇▇▇▇▇▇.
7. Captions; References. The headings and captions in this Agreement are for
convenience of reference only and shall not define, affect or limit any of
the terms or
provisions hereof or therein. All references herein to Paragraphs, Articles
and/or Sections are, unless specified otherwise, references to paragraphs,
articles and/or sections of this Agreement. Unless specifically indicated
otherwise, all references herein to an "Exhibit," "Annex" or "Schedule" are
references to exhibits, annexes or schedules attached hereto, all of which
are incorporated herein and made a part hereof for all purposes, the same
as if set forth fully herein, it being understood that if any exhibit,
annex or schedule attached hereto which is to be executed and delivered
contains blanks, the same shall be completed correctly and in accordance
with this Settlement Agreement prior to or at the time of the execution and
delivery thereof. The words "herein," "hereof," "hereunder" and other
similar compounds of the word "here" when used in this Settlement Agreement
shall refer to the entire Agreement and not to any particular provision or
section unless specifically indicated otherwise.
8. Binding Effect. Subject to the approval of the Board of Directors of
Compass, this Agreement shall be binding upon the parties as of the
Effective Date and as well as their respective administrators, successors
and assigns, and shall inure to the benefit of the parties and their
respective administrators, successors and assigns.
9. Severability. Should any of the provisions of this Agreement be determined
to be invalid by a Court of competent jurisdiction, the parties agree that
this shall not affect the validity or enforceability of the remaining
provisions, and that they shall renegotiate and reform any invalid
provisions in good faith to effectuate the purpose of this Agreement and to
conform it to the law.
10. Entire Agreement and Modification. This Agreement constitutes the entire
understanding between the parties and may not be modified without the
express written consent of the parties.
11. No Improper Inducement. The parties represent and acknowledge that in
executing this Agreement they do not rely, and have not relied, on any
representation or statement made by any of the parties or their respective
agents, representatives or counsel with regard to the subject matter, bases
or effect of this Agreement or otherwise, other than as specifically stated
in this Agreement.
12. Knowing and Voluntary. The parties hereto have read this Agreement and
fully understand it. The only promises made in connection with this
Agreement are those stated herein and the parties have signed this
Agreement knowingly and voluntarily.
13. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
14. Dispute Resolution.
(a) General. In the event of any dispute, difference or question arising
between the parties in connection with this Agreement, the construction
thereof, or the rights, duties or liabilities of either party, and which
dispute cannot be amicably resolved by the good faith efforts of the
parties, then such dispute shall be referred to binding arbitration as set
forth in Article 13(b) below.
(b) Arbitration. Binding arbitration shall be conducted in accordance with
the Commercial Arbitration Rules of the American Arbitration Association in
Orlando,
Florida. The arbitration panel shall be composed of three arbitrators, one
of whom shall be chosen by Compass, one by ▇▇▇▇▇▇ and the third by the two
so chosen. The arbitrators shall each reasonable experience in dealing with
such matters and shall not be an employee, director, shareholder or agent
of either party or of an affiliate of either party, or otherwise involved
(whether by contract or otherwise) in the affairs of either party. If both
or either of Compass or ▇▇▇▇▇▇ fails to choose an arbitrator or arbitrators
within fourteen (14) days after receiving notice of commencement of
arbitration or if the two arbitrators fail to choose a third arbitrator
within fourteen (14) days after their appointment, the then President or
his designee of the Orlando office of the American Arbitration Association
shall, upon the request of both or either of the parties to the
arbitration, appoint the arbitrator or arbitrators required to complete the
board or, if he shall decline or fail to do so, such arbitrator or
arbitrators shall be appointed by the President or his designee of the
American Arbitration Association. The arbitrators shall make their decision
known to both parties as quickly as possible by delivering written notice
of their decision to both Parties. The Parties shall agree in writing to
comply with the ruling of the arbitration panel within five (5) days of
receipt of notice of such ruling. The decision of the arbitrators shall be
final and binding on the Parties, and specific performance may be ordered
by any court of competent jurisdiction. The Parties shall bear their own
costs in preparing for the arbitration. The costs of the arbitrators shall
be equally divided between the Parties.
15. Notices. Any notice, demand, request, waiver, or other communication under
this Agreement shall be in writing and shall be deemed to have been duly
given on the date of service if personally served or sent by confirmed
telecopy and on the third day after mailing if mailed to the party to whom
notice is to be given, by first class mail, registered, return receipt
requested, postage prepaid and addressed to the proper party at the
addresses set forth in Section 9.2 of the Employment Agreement.
IN WITNESS WHEREOF, the parties hereby execute this Agreement by their
respective officers duly authorized in their behalf effective as of the date and
year first written above.
Witnesses: Compass:
Compass Knowledge Holdings, Inc.
_______________________ By: /S/ ▇▇▇ ▇▇▇▇▇▇
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▇▇▇ ▇▇▇▇▇▇, President
▇▇▇▇▇▇:
________________________ /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.