**Exhibit10.31**

 

**EMPLOYMENTAGREEMENT**

 

This Employment Agreement (this “Agreement”) ismade by and between INVESTools Inc., a Delaware corporation (the “Company”),and D. Scott Elder (“Employee”) effective as of December 6, 2001 (the“Effective Date”).

 

WHEREAS, the Company is desirous of employingEmployee in an executive capacity on the terms and conditions, and for theconsideration, hereinafter set forth for the period provided herein commencingupon the Effective Date, and Employee is desirous of employment with theCompany on such terms and conditions and for such consideration.

 

NOW, THEREFORE, for and in consideration of themutual promises, covenants and obligations contained herein, the Company andEmployee agree as follows:

 

**ARTICLEIEMPLOYMENT AND DUTIES**

 

Section 1.1 The Company agrees to employ Employee and Employee agrees to be employedby the Company, subject to the terms and conditions of this Agreement,beginning as of the Effective Date and continuing for the term hereof.

 

Section 1.2 From and after the Effective Date, the Company shall employ Employee inthe position of Executive Vice President of the Company, or in such otherpositions as the parties mutually may agree.

 

Section 1.3 Employee agrees to serve in the position referred to in Section 1.2hereof and to perform diligently and to the best of his abilities the dutiesand services pertaining to such office as set forth in the Bylaws of theCompany in effect on the Effective Date, as well as such additional duties andservices appropriate to such office as the Board of Directors of the Company(the “Board of Directors”) may reasonably assign to Employee from time to time.

 

Section 1.4 Employee agrees, during the period of his employment by the Company, todevote his full business time, energy and best efforts to the business andaffairs of the Company and its affiliates and not to engage, directly orindirectly, in any other business or businesses, whether or not similar to thatof the Company, except with the prior written consent of the Board ofDirectors. The foregoing notwithstanding, the parties recognize and agree thatEmployee may engage in passive personal investments and charitable or publicservice activities and serve on the board of directors of corporations to theextent that such activities do not conflict with the business and affairs ofthe Company or interfere with Employee’s performance of his duties andobligations hereunder.

 

# **ARTICLE II**

# **TERM AND TERMINATION OF EMPLOYMENT**

 

Section 2.1 Unless sooner terminated pursuant to other provisions hereof, theCompany agrees to employ Employee for a three-year period beginning on theEffective Date, and thereafter automatically extend the term of this Agreementfor successive one-year periods unless and until such time as either partyshall give written notice to the other at least 15 days prior to theexpiration of the then current term that no such automatic extension shalloccur, in which event Employee’s employment shall terminate on the expirationof the then current term.

 

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Section 2.2 Notwithstanding the provisions of Section 2.1 hereof, the Companyshall have the right to terminate Employee’s employment under this Agreement atany time in accordance with the following provisions:

 

(a)          upon Employee’s death;

 

(b)         upon Employee’s becoming incapacitated or disabled by accident, sicknessor other circumstance which impairment (despite reasonable accommodation)renders him mentally or physically incapable of performing the duties andservices required of him hereunder for a period of at least 120 consecutivedays or for a period of 180 business days during any 12-month period;

 

(c)          for cause, which for purposes of this Agreement shall mean each of thefollowing:

 

(i)             a material act or material acts of dishonesty ordisloyalty by Employee adversely affecting the Company;

 

(ii)          Employee’s breach of any of his obligations of this Agreement;

 

(iii)       Employee’s gross negligence or willful misconduct in performance of theduties and services required of him pursuant to this Agreement; or

 

(iv)      Employee’s conviction of a felony, or Employee’s conviction of amisdemeanor involving moral turpitude.

 

(d)         by “Constructive Termination,” which for purposes of this Agreementshall mean each of the following:

 

(i)             a material diminution of Employee’sresponsibilities, including, without limitation, title and reportingrelationship;

 

(ii)          relocation of any Provo, Utah office of the Company without the consentof Employee; or

 

(iii)       a material reduction in Employee’s compensation and benefits receivedhereunder.

 

(e)          in the sole discretion of the Board of Directors without cause; *provided,however,* in such case the Company shall give 15 days priorwritten notice to Employee of its intention to terminate Employee’s employmentwith the Company and shall continue to provide compensation to Employee inaccordance with the terms set forth in Section 4.1(e) hereof.

 

Section 2.3 Employee shall have the right to terminate his employment under thisAgreement at any time in accordance with the following provisions:

 

(a)          a breach by the Companyof any of its obligations under this Agreement which, if correctable, remainsuncorrected for 30 days following written notice specifying such breachgiven by Employee to the Company; or

 

(b)         In the sole discretion of Employee, *provided,however,* in such case Employee shall give 15 days prior writtennotice to the Company of his intention to terminate his employment with the

 

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Company.

 

Section 2.4 If the Company desires to terminate Employee’s employment hereunder asprovided in Section 2.2 hereof or Employee desires to terminate Employee’semployment hereunder as provided in Section 2.3 hereof, it or he shall doso by giving written notice to the other party that it or he has elected toterminate Employee’s employment hereunder and stating the effective date andreason, if any, for such termination. In the event of such termination, theprovisions of Articles IV through IX hereof shall continue to apply inaccordance with their terms. Any question as to whether and when there has beena termination of Employee’s employment, and the cause of such termination,shall be determined by the Board of Directors in its sole discretion.

 

# **ARTICLE III**

# **COMPENSATION AND BENEFITS**

 

Section 3.1* Compensation.*  Duringthe term of this Agreement, the Company shall provide compensation to Employeein the following forms:

 

(a)          *Base Salary.*  Employeeshall receive an annual base salary of $350,000, which amount shall be subjectto annual review by the Board of Directors and/or the Compensation Committee ofthe Company for possible increases.

 

(b)         *Bonus.*

 

(i)             Employee shall participate in, and receive anannual bonus pursuant to, the Company’s Executive Committee Annual Bonus Plan.

 

(ii)         Employee shall participate in, and receive an annual bonus pursuant to,the Company’s Management Incentive 

        Bonus Plan.

 

(iii)       In addition, Employee shall receive a one-time payment of $175,000 cashto be paid on December 31, 2002.

 

(c)          *Stock Options.*

 

(i)             Upon approval of the Company’s Board of Directors,Employee will be granted options to purchase an aggregate of 200,000 shares ofthe Company’s common stock at an exercise price equal to the per share Fair MarketValue (as hereinafter defined) on the date of grant.  To the extent permitted by applicable laws, the options to begranted to Employee shall be granted as incentive options.  All options granted to Employee hereundershall vest immediately upon a Change of Control (as hereinafter defined).  The options will be granted pursuant to astock option agreement to be executed by Employee and the Company as of thedate hereof, which shall provide, among other things, that the options willvest in four equal annual installments beginning one year from the date of thisAgreement.

 

“FairMarket Value” means (i) if the Company’s common stock is not listed or admittedto trade on a national securities exchange and if bid and ask prices for thecommon stock are not furnished through NASDAQ or a similar organization, thevalue established by the Compensation Committee of the Board of Directors (the“Compensation Committee”), in its sole discretion; (ii) if the Company’s commonstock is listed or admitted to trade on a national 

 

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securitiesexchange or a national market system, the closing price of the common stock, aspublished in the *Wall Street Journal*,so listed or admitted to trade on such day or, if there is no trading of thecommon stock on such date, then the closing price of the common stock on thenext preceding date on which there was trading in such shares; or (iii) if thecommon stock is not listed or admitted to trade on a national securitiesexchange or a national market system, the mean between the bid and asked pricefor the common stock on such date, as furnished by the National Association ofSecurities Dealers, Inc. through NASDAQ or a similar organization if NASDAQ isno longer reporting such information.

 

(ii)                In addition, Employee shall be eligible to receivefuture stock option grants, as determined by the Compensation Committee.

 

(d)         *Merger TransitionAward.*

 

(i)                   Employee shall receive a merger transition award(the “Merger Transition Award”) consisting of an aggregate of $1,200,000 incash which shall be payable in three equal installments beginning one year fromthe date of this Agreement.

 

(ii)                In the event of a Change of Control (ashereinafter defined), any remaining unpaid amount of the Merger TransitionAward shall be paid in full; provided, however, that this subsection (ii) shallnot apply to a Change of Control resulting from action by the directors ormanagement of the Company or their affiliates.

 

Section 3.2* Benefits.*  During theterm of this Agreement, Employee shall be afforded the following benefits asincidences of his employment:

 

(a)          *Business andEntertainment Expenses.*  Subject to the Company’s standard policiesand procedures with respect to expense reimbursement as applied to itsexecutive employees generally, the Company will reimburse Employee for, or payon behalf of Employee, reasonable and appropriate expenses incurred by Employeefor business related purposes, including dues and fees to approved industry andprofessional organizations, and reasonable costs of entertainment incurred inconnection with business development.

 

(b)         *Club Membership.*  TheCompany shall reimburse Employee for membership dues at social or country clubsdesignated by Employee as mutually agreed by the Company and Employee.

 

(c)          *Other.*  Employeeand, to the extent applicable, Employee’s family, dependents and beneficiaries,shall be allowed to participate in all benefits, plans and programs, includingimprovements or modifications of the same, which are now, or may hereafter be,available to executive employees of the Company generally. Such benefits, plansand programs may include, without limitation, a profit sharing plan, a thriftplan, a health insurance or health care plan, life insurance, disabilityinsurance or a pension plan. The Company shall not, however, by reason of thisparagraph be obligated to institute, maintain, or refrain from changing,amending or discontinuing, any such benefit plan or program, so long as suchchanges are similarly applicable to executive employees of the Companygenerally.

 

Section 3.3* Payroll.*  Employeeshall receive all compensation pursuant to this Agreement in accordance withthe Company’s Provo, Utah customary payroll practices with respect to time andmanner of payment.

 

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**ARTICLE IVEFFECT OF TERMINATION ON COMPENSATION**

 

Section 4.1* By the Company.*

 

(a)          *Termination UponDeath.*  In the event of Employee’s death during the term of thisAgreement, this Agreement will terminate upon the first day of the monthfollowing the Employee’s date of death, and all of Employee’s rights andbenefits provided for in this Agreement will terminate as of such date; *provided,however*, that Employee’s estate will be paid Employee’s annualsalary and pro rata bonus through the date of death for a period of six monthsafter such death occurs and, *provided, further*, all stock optionsreferenced in Section 3.1(c) shall vest on Employee’s death, andEmployee’s estate may exercise such options for a period of one year from thedate of termination and, *provided further* that, the MergerTransition Award shall be paid in full within three months after such deathoccurs.

 

(b)         *Termination UponDisability.*  If Employee’s employment hereunder isterminated by the Company pursuant to Section 2.2(b) hereof prior to theexpiration of the then current term, all of Employee’s rights and benefitsprovided for in this Agreement will terminate as of such date; *provided,however*, that Employee will be paid Employee’s annual salary and prorata bonus through the date of termination for a period of six months aftersuch termination occurs and, *provided, further*, all stock optionsreferenced in Section 3.1(c) shall vest effective as of the terminationdate, and Employee may exercise such options for a period of one year from thedate of termination and, *provided further*, that, the MergerTransition Award shall be paid in full within six months after such terminationoccurs.

 

(c)          *Termination forCause.*  Employer shall be entitled to terminate Employee’s employment atany time for cause, as defined by Section 2.2(c). In the event oftermination for cause, all of Employee’s rights and benefits provided for inthis Agreement shall terminate, except as to any accrued and unpaid base salaryprovided for in Section 3.1(a).

 

(d)         *Termination AfterChange of Control.*  Except as set forth inSection 3.1(d)(ii), if, within 24 months following a Change ofControl (as hereinafter defined), the Company or its successor terminatesEmployee’s employment without cause or by Constructive Termination, Employeewill be paid, in a lump sum payment, an amount equal to two times the sum of(i) his annual salary for the year in which such termination occurs and(ii) the greater of (A) the target bonuses for each of the fourquarters in the year in which such termination occurs and (B) the actualbonus earned by Employee for the four fiscal quarters immediately precedingsuch termination. All unvested stock options referenced in Section 3.1(c)shall vest effective as of the date of termination and Employee may exercisesuch options for a period of 90 days from the date of termination.Employee shall receive his accrued and unpaid salary and any accrued and unpaidpro rata bonus through the date of termination, and Employee will continue toparticipate in any benefits referenced in Section 3.2(c) for a period oftwo years from the date of termination; *provided, however*, to the extent that anybenefit under Section 3.2(c) cannot be continued during a period whenEmployee is not an employee of the Company, the Company shall pay Employee anamount in cash equal to the economic value of such benefit, such value to bedetermined as of the time of termination.

 

In theevent that Employee is deemed to have received an excess parachute payment (assuch term is defined in Section 280G(b) of the Internal Revenue Code of1986, as amended (the

 

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“Code”))which is subject to excise taxes (“Excise Taxes”) imposed by Section 4999of the Code with respect to compensation paid to Employee pursuant to thisAgreement, the Company shall make a Bonus Payment (as defined below) toEmployee when Employee receives any excess parachute payments.  “Bonus Payment” means a cash payment equalto the sum of (i) all Excise Taxes payable by Employee plus (ii) anyadditional Excise Tax or federal or state income taxes imposed with respect tothe Bonus Payment.

 

“Changeof Control” means the happening of any of the following events:

 

(i)             The acquisition by any individual, entity or group(within the meaning of Section 13(d)(3) or 14(d)(2) of the SecuritiesExchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”), ofbeneficial ownership (within the meaning of Rule 13d-3 promulgated underthe Exchange Act) of 50% or more of either (A) the then outstanding sharesof common stock of the Company or (B) the combined voting power of thethen outstanding voting securities of the Company entitled to vote generally inthe election of directors; provided, however, that the following acquisitionsshall not constitute a Change of Control under this subsection (i):(x) any acquisition directly from the Company (excluding an acquisition byvirtue of the exercise of a conversion privilege), (y) any acquisition bythe Company, or (z) any acquisition by any employee benefit plan (orrelated trust) sponsored or maintained by the Company or any corporationcontrolled by the Company; or

 

(ii)          Individuals who, as of the effective date hereof, constitute the Boardof Directors (the “Incumbent Board”) cease for any reason to constitute atleast a majority of the Board; provided, however, that any individual becominga director subsequent to the effective date hereof whose election, or nominationfor election by the Company’s stockholders, was approved by a vote of at leasta majority of the directors then comprising the Incumbent Board shall beconsidered as though such individual were a member of the Incumbent Board, butexcluding, for this purpose, any such individual whose initial assumption ofoffice occurs as a result of either an actual or threatened election contest(as such terms are used in Rule 14a-11 of Regulation 14A promulgatedunder the Exchange Act) or other actual or threatened solicitation of proxiesor consents by or on behalf of a Person other than the Board; or

 

(iii)       Approval by the stockholders of the Company of a complete liquidation ordissolution of the Company or the sale 

        or other disposition of all or substantially all of theassets of the Company.

 

(e)          *Other Events UponTermination.*  If Employee’s employment hereunder shall beterminated by the Company without cause or by Constructive Termination otherthan within 24 months following a Change of Control, Employee shallreceive in accordance with the Company’s then current payroll practices anamount equal to the sum of (i) Employee’s annual base salary for the yearin which such termination occurs and (ii) the greater of (A) thetarget bonuses for each of the four quarters in the year in which suchtermination occurs and (B) the actual bonus earned by Employee for thefour fiscal quarters immediately preceding such termination, payable for aperiod of time equal to the longer of (i) two years and (ii) theperiod of time remaining under the then current term of this Agreement (suchlonger period, the “Severance Period”). Employee shall receive his accrued andunpaid salary and any accrued and unpaid pro rata bonus through the date oftermination, and Employee will continue to participate in any benefitsreferenced in Section 3.2(c) for the Severance Period; *provided,however*, to the extent that any benefit under Section 3.2(c)cannot be continued during a period when Employee is not

 

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an employee of the Company, the Company shall pay Employee an amount incash equal to the economic value of such benefit, such value to be determinedas of the time of termination. In addition, all stock options referenced inSection 3.1(c) shall vest effective as of the date of termination, andEmployee may exercise such options for a period of three months from the dateof termination and *provided, further*, that the MergerTransition Award shall be paid in full upon the date of termination.

 

Section 4.2*  By Employee.*

 

(a)          *Breach ofAgreement by Company.*  If Employee’s employment hereunder shall beterminated by Employee pursuant to the provisions set forth inSection 2.3(a) hereof prior to the expiration of the then current term ofthis Agreement, Employee shall receive in accordance with the Company’s thencurrent payroll practices an amount equal to the sum of (i) Employee’sannual base salary for the year in which such termination occurs and(ii) the greater of (A) the target bonuses for each of the fourquarters in the year in which such termination occurs and (B) the actualbonus earned by Employee for the four fiscal quarters immediately precedingsuch termination, payable for a period of time equal to the longer of(i) two years and (ii) the period of time remaining under the thencurrent term of this Agreement. Employee shall receive his accrued and unpaidsalary and any accrued and unpaid pro rata bonus through the date oftermination, and Employee will continue to participate in any benefitsreferenced in Section 3.2(c) for the Severance Period; *provided,however*, to the extent that any benefit under Section 3.2(c)cannot be continued during a period when Employee is not an employee of theCompany, the Company shall pay Employee an amount in cash equal to the economicvalue of such benefit, such value to be determined as of the time oftermination. In addition, all stock options referenced in Section 3.1(c)shall vest effective as of the date of termination, and Employee may exercisesuch options for a period of three months from the date of termination and *provided,further*, that, the Merger Transition Award shall be paid infull upon the date of termination.

 

(b)         *VoluntaryResignation.*  If Employee’s employment hereunder shall beterminated by Employee pursuant to the provisions set forth inSection 2.3(b) hereof prior to the expiration of the then current term,then, upon such termination, subject to COBRA, all compensation and allbenefits to Employee hereunder shall terminate contemporaneously with thetermination of such employment; *provided, however*, Employee shall notreceive a bonus for the year during which Employee’s employment terminated orany subsequent year, and *provided, further,*that any Employee shall not receive any additional unpaid amounts of the MergerTransition Award.

 

**ARTICLEVCONFIDENTIAL INFORMATION**

 

Section 5.1* Company Information.* Employee acknowledges that the Company’s business is highly competitiveand that the Company’s books, records and documents, technical informationconcerning its products, equipment, services and processes, procurementprocedures and pricing techniques and the names of and other information (e.g.,credit and financial data) concerning the Company’s customers and businessassociates all comprise confidential business information and trade secrets ofthe Company (collectively, “Confidential Information”*)* which are valuable,special, and unique assets of the Company which the Company uses in itsbusiness to obtain a competitive advantage over the Company’s competitors whichdo not know or use this information. Employee further acknowledges thatprotection of the Confidential Information against unauthorized disclosure anduse is of critical importance to the Company in maintaining its competitiveposition. Accordingly, Employee hereby agrees that he will not, at any timeduring or after 

 

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his employment by the Company, make any unauthorized disclosure of anyConfidential Information or make any use thereof, except for the benefit of,and on behalf of, the Company. For the purposes of this Article 5, theterm “Company” shall also include affiliates of the Company.

 

Section 5.2* Third Party Information.* Employee acknowledges that, as a result of his employment by theCompany, he may from time to time have access to, or knowledge of, confidentialbusiness information or trade secrets of third parties, such as customers,suppliers, partners, joint venturers, and the like, of the Company. Employeeagrees to preserve and protect the confidentiality of such third-partyconfidential information and trade secrets to the same extent, and on the samebasis, as the Confidential Information.

 

Section 5.3* Return of Documents.* All written materials, records and other documents made by, or cominginto the possession of, Employee during the period of his employment by theCompany which contain or disclose the Confidential Information shall be andremain the property of the Company. Upon request, and in any event upontermination of Employee’s employment by the Company, for any reason, hepromptly shall deliver the same, and all copies, derivatives and extractsthereof, to the Company.

 

**ARTICLEVIINVENTIONS, DISCOVERIES AND COPYRIGHTS**

 

Section 6.1* Inventions and Discoveries.* Employee agrees promptly and freely to disclose to the Company, inwriting, any and all ideas, conceptions, inventions, improvements, anddiscoveries, whether patentable or not, which are conceived or made by Employee,solely or jointly with another, during the period of his employment by theCompany and which are related to the business or activities of the Company.Employee agrees to assign and hereby does assign to the Company all hisinterest in such ideas, conceptions, inventions, improvements, and discoveries.Employee agrees that, whenever requested to do so by the Company, he shallassist in the preparation of any document that the Company shall deem necessaryand shall execute any and all applications, assignments or other instrumentsthat the Company shall deem necessary, in its sole discretion, to apply for andobtain protection, including patent protection, for such ideas, conceptions,inventions, improvements and discoveries in all countries of the world. Theobligations in the preceding sentence shall continue beyond the termination ofEmployee’s employment regardless of the reason for such termination.

 

Section 6.2* Copyrights.*  If duringEmployee’s employment by the Company, Employee creates any original work ofauthorship (each, a “Work”) fixed in any tangible medium of expression which isthe subject matter of copyright *(*e.g.*,* written presentations, computerprograms, videotapes, drawings, maps, models, manuals or brochures) relating tothe Company’s business, products, or services, whether a Work is created solelyby Employee or jointly with others, the Company shall be deemed the author of aWork if the Work is prepared by Employee in the scope of his employment; or, ifthe Work is not prepared by Employee within the scope of his employment but isspecially ordered by the Company as a contribution to a collective work, as apart of a motion picture or other audiovisual work, as a translation, as asupplementary work, as a compilation or as an instructional text, then the Workshall be considered to be a work made for hire and the Company shall be theauthor of the Work. In the event a Work is not prepared by Employee within thescope of his employment or is not a Work specially ordered and deemed to be awork made for hire, then Employee hereby agrees to assign, and by thesepresents, does assign, to the Company all of Employee’s worldwide right, titleand interest in and to such Work and all rights of copyright therein. Bothduring the period of Employee’s employment by the Company and thereafter,Employee agrees to assist the Company and its nominee, at any time, in theprotection of the Company’s worldwide right, title and interest in and to thework and all rights of copyright therein, including but not limited to, theexecution of all formal assignment documents requested by the Company or itsnominee and the execution of all lawful oaths and

 

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applications for registration of copyright in theUnited States and foreign countries.

 

Section 6.3 Employee represents that he has not heretofore made any invention ordiscovery or prepared any work which is the subject matter of copyright relatedto the Company’s business which he wishes to exclude from the provisions ofSection 6.1 and Section 6.2 hereof. As used in this Article VI,the “Company” shall include affiliates of the Company.

 

**ARTICLEVIINON-COMPETITION**

 

Section 7.1 The restrictive covenants contained in this Article VII and inArticle VIII hereof are supported by consideration to Employee hereunder.As a material incentive for the Company to enter into this Agreement, Employeehereby agrees that he will not at any time during his employment by the Companyand for a period commencing on the date of termination of his employment andcontinuing until the expiration of 24 months (the “Non-CompetitionPeriod”)*,*directly or indirectly, for himself or for others, in any state of the UnitedStates, or in any foreign country where the Company or any of its affiliates isthen conducting any business:

 

(a)           engage in any business that is directly competitive with activitiesconducted by the Company (or any of the Company’s subsidiaries or divisions),which activities conducted by the Company (or any of the Company’s subsidiariesor divisions) represent in the aggregate greater than 25% of the Company’sproforma consolidated revenues in 2001;

 

(b)          render advice or services to, or otherwise assist, any other person orentity who is engaged, directly or indirectly, in any business that is directlycompetitive with activities conducted by the Company (or any of the Company’ssubsidiaries or divisions), which activities conducted by the Company (or anyof the Company’s subsidiaries or divisions) represent in the aggregate greaterthan 25% of the Company’s proforma consolidated revenues in 2001; or

 

(c)           transact any business in any manner pertaining to suppliers or customersof the Company or any affiliate which, in any manner, would have, or is likelyto have, an adverse effect upon the Company or any affiliate.

 

The foregoing shall not prohibit Employee’scontinued participation in those activities in which he is engaged on the datehereof and which have been disclosed to the Company.

 

Notwithstanding the foregoing, in the event of terminationof this Agreement pursuant to Section 4.1(d), 4.1(e) or 4.2(a), theprohibitions of this Article VII shall no longer apply at such time asEmployee waives his right to receive any further payments underSection 4.1(d), 4.1(e) or 4.2(a), as the case may be.

 

Section 7.2 Employee understands that the foregoing restrictions may limit hisability to engage in a business similar to the Company’s business in specificareas of the world for the Non-Competition Period, but acknowledges that hewill receive sufficiently high remuneration and other benefits from the Companyhereunder to justify such restriction. In addition to any remedies providedunder applicable law, the Company and Employee agree that during the period theCompany is paying compensation and benefits to Employee pursuant to ArticlesIII or IV hereof, the Company’s remedy for breach of the provisions of thisArticle VII shall include, but shall not be limited to, the termination ofall compensation and all benefits to Employee otherwise provided under thisAgreement.

 

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Section 7.3 It is expressly understood and agreed that the Company and Employeeconsider the restrictions contained in Section 7.1 hereof to be reasonableand necessary for the purposes of preserving and protecting the good will andproprietary information of the Company, nevertheless, if any of the aforesaidrestrictions is found by a court having jurisdiction to be unreasonable, overbroad as to geographic area or time or otherwise unenforceable, the partiesintend for the restrictions therein set forth to be modified by such court soas to be reasonable and enforceable and, as so modified by the court, to befully enforced.

 

**ARTICLEVIIISOLICITATION OF EMPLOYEES**

 

During the term of his employment by the Companyand thereafter for the Non-Competition Period, Employee shall not, on his ownbehalf or on behalf of any other person, partnership, entity, association, orcorporation, hire or seek to hire any non-clerical or non-secretarial employeeof the Company or in any other manner attempt directly or indirectly toinfluence, induce, or encourage any non-clerical or non-secretarial employee ofthe Company to leave the employment of the Company, nor shall he use ordisclose to any person, partnership, entity, association, or corporation anyinformation concerning the names, addresses or personal telephone numbers ofany employees of the Company.

 

**ARTICLEIXMISCELLANEOUS**

 

Section 9.1 Notices.  For purposes of thisAgreement, notices and all other communications provided for herein shall be inwriting and shall be deemed to have been duly given when personally deliveredor when mailed by United States registered or certified mail, return receiptrequested, postage prepaid, addressed as follows:

 
| If  to the Company to: |   | INVESTools  Inc  5959 Corporate Drive, Suite 2000Houston, TX  77036  Attention: Chairman of the Compensation Committee |
|------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------|
|                   |   |                                                                                                                        |
| If  to Employee to:    |   | D.  Scott Elder1156 E. 100 NorthOrem, UT   84097                                                                       |

 

orto such other address as either party may furnish to the other in writing inaccordance herewith, except that notices of changes of address shall beeffective only upon receipt.

 

Section 9.2* Applicable Law, Jurisdiction and Venue.*  This Agreement is entered into under, and shallbe governed for all purposes by, the laws of the State of Texas. Any suit bythe Company to enforce any right hereunder or to obtain a declaration of anyright or obligation hereunder may, at the sole option of the Company, bebrought (i) in any court of competent jurisdiction in the State of Texasor (ii) in any court of competent jurisdiction where jurisdiction may behad over Employee. Employee hereby expressly consents to the jurisdiction ofthe foregoing courts for such purposes and to the appointment of the Secretaryof State for the State of Texas as his agent for service of process.

 

Section 9.3* No Waiver.*  No failureby either party hereto at any time to give notice of any breach by the otherparty of, or to require compliance with, any condition or provision of thisAgreement shall (i) be deemed a waiver of similar or dissimilar provisionsor conditions at the same or at any prior or 

 

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subsequent time or (ii) preclude insistenceupon strict compliance in the future.

 

Section 9.4* Severability.*  If acourt of competent jurisdiction determines that any provision of this Agreementis invalid or unenforceable, then the invalidity or unenforceability of thatprovision shall not affect the validity or enforceability of any otherprovision of this Agreement, and all other provisions shall remain in fullforce and effect.

 

Section 9.5* Counterparts.*  ThisAgreement may be executed in one or more counterparts, each of which shall bedeemed to be an original, but all of which together will constitute one and thesame Agreement.

 

Section 9.6* Withholding of Taxes.* The Company may withhold from any benefits payable under this Agreementall federal, state, city or other taxes as may be required pursuant to any lawor governmental regulation or ruling.

 

Section 9.7* Headings.*  Theparagraph headings have been inserted for purposes of convenience and shall notbe used for interpretive purposes.

 

Section 9.8* Affiliate.*  As used inthis Agreement, “affiliate” shall mean any person or entity which directly orindirectly through one or more intermediaries owns or controls, is owned orcontrolled by, or is under common ownership or control with, the Company.

 

Section 9.9* Assignment.*  ThisAgreement, and the rights and obligations of the parties hereunder, arepersonal and neither this Agreement, nor any right, benefit or obligation ofeither party hereto, shall be subject to voluntary or involuntary assignment,alienation or transfer, whether by operation of law or otherwise, without theprior written consent of the other party except that vested rights to paymentshall be subject to devise, and shall descend in accordance with applicablelaws of inheritance.

 

Section 9.10*  Legal Fees.*  If, prior to a Change of Control, eitherparty institutes any legal action to enforce his or its rights under, or torecover damages for breach of this Agreement, the Company shall pay up to anaggregate of $10,000 of Employee’s actual expenses incurred in pursuit ordefense of such legal action.

 

If, following a Change of Control, either partyinstitutes any legal action to enforce his or its rights under, or to recoverdamages for breach of this Agreement, the “prevailing party” in such actionshall be entitled to recover from the other party any actual expenses forattorney’s fees and disbursements incurred by him or it. For these purposes, aparty shall be considered a “prevailing party” if and only if the parties agreeto such characterization of a party as a “prevailing party” or a final order ofa court specifically recites that such party is a “prevailing party.”

 

Section 9.11* Term.*  This Agreementhas a term co-extensive with the term of employment as defined inSection 2.1 hereof. Termination of this Agreement pursuant to theprovisions of Section 2.1 hereof shall not affect any right or obligationof either party hereto which is accrued or vested prior to or upon suchtermination or the rights and set forth in Articles IV, V, VI and VII hereof.

 

Section 9.12* Entire Agreement.* This Agreement constitutes the entire agreement of the parties withregard to the subject matter hereof, and contains all the covenants, promises,representations, warranties and agreements between the parties with respect toemployment of Employee by the Company. Each party to this Agreementacknowledges that no representation, inducement, promise or agreement, oral orwritten, has been made by either party, or by anyone acting on behalf of eitherparty, which is not embodied herein, and that no agreement, statement, orpromise relating to the employment of Employee by

 

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theCompany, which is not contained in this Agreement, shall be valid or binding.Any modification of this Agreement will be effective only if it is in writingand signed by the party to be charged.

 

IN WITNESS WHEREOF, the parties hereto haveexecuted this Agreement effective as of the Effective Date.

 
|   | INVESTools  Inc.    |
|--------|---------------------|
|   |                |
|   | By:                 | /s/  PAUL A. HELBLING |
|   |                |
|   | Name:               | Paul  A. Helbling |
|   |                |
|   | Title:              | Chief  Financial Officer |
|   |                |
|   | /s/  D. SCOTT ELDER |   |
|   | D.  Scott Elder     |
|        |                     |  |  |  |  |

 

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