Document:

Exhibit 10.32

 

 

EMPLOYMENT AGREEMENT

 

This Employment Agreement (this “Agreement”) is made by and between
INVESTools Inc., a Delaware corporation (the “Company”), and Ross Jardine
(“Employee”) effective as of December 6, 2001 (the “Effective Date”).

 

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

 

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

 

ARTICLE I

EMPLOYMENT AND DUTIES

 

Section 1.1  The Company
agrees to employ Employee and Employee agrees to be employed by 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 in the position of
Executive Vice President of the Company, or in such other positions as the
parties mutually may agree.

 

Section 1.3  Employee
agrees to serve in the position referred to in Section 1.2 hereof and to
perform diligently and to the best of his abilities the duties and services
pertaining to such office as set forth in the Bylaws of the Company in effect
on the Effective Date, as well as such additional duties and services 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, to devote his full
business time, energy and best efforts to the business and affairs of the
Company and its affiliates and not to engage, directly or indirectly, in any
other business or businesses, whether or not similar to that of the Company,
except with the prior written consent of the Board of Directors. The foregoing
notwithstanding, the parties recognize and agree that Employee may engage in
passive personal investments and charitable or public service activities and
serve on the board of directors of corporations to the extent that such
activities do not conflict with the business and affairs of the Company or
interfere with Employee’s performance of his duties and obligations hereunder.

 

ARTICLE II

TERM AND TERMINATION OF EMPLOYMENT

 

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

 

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

 

	
   

  	
  (a)

  	
  upon Employee’s death;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  upon Employee’s becoming incapacitated or
  disabled by accident, sickness or other circumstance which impairment
  (despite reasonable accommodation) renders him mentally or physically
  incapable of performing the duties and services required of him hereunder for
  a period of at least 120 consecutive days 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 the following:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (i)

  	
  a material act or material acts of
  dishonesty or disloyalty 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 the duties and services required of    him pursuant to this Agreement; or

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (iv)

  	
  Employee’s conviction of a felony, or
  Employee’s conviction of a misdemeanor involving moral turpitude.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  by “Constructive Termination,” which for
  purposes of this Agreement shall mean each of the following:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (i)

  	
  a material diminution of Employee’s
  responsibilities, including, without limitation, title and reporting
  relationship;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (ii)

  	
  relocation of any Provo, Utah office of the
  Company without the consent of Employee; or

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (iii)

  	
  a material reduction in Employee’s
  compensation and benefits received hereunder.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (e)

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

  

 

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

 

	
   

  	
  (a)

  	
   

  	
  a breach by the Company of any of its
  obligations under this Agreement which, if correctable, remains uncorrected
  for 30 days following written notice specifying such breach given by
  Employee to the Company; or

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
   

  	
  In the sole discretion of Employee, provided, however, in such case Employee
  shall give 15 days prior written notice 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 as provided in
Section 2.2 hereof or Employee desires to terminate Employee’s employment
hereunder as provided in Section 2.3 hereof, it or he shall do so by
giving written notice to the other party that it or he has elected to terminate
Employee’s employment hereunder and stating the effective date and reason, if
any, for such termination. In the event of such termination, the provisions of
Articles IV through IX hereof shall continue to apply in accordance with their
terms. Any question as to whether and when there has been a 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.  During
the term of this Agreement, the Company shall provide compensation to Employee
in the following forms:

 

	
   

  	
  (a)

  	
  Base Salary. 
  Employee shall receive an annual base salary of $350,000, which amount
  shall be subject to annual review by the Board of Directors and/or the
  Compensation Committee of the Company for possible increases.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  Bonus.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (i)

  	
  Employee shall participate in, and receive
  an annual 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 cash to 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 of the Company’s common stock at an exercise price equal to
  the per share Fair Market Value (as hereinafter defined) on the date of
  grant.  To the extent permitted by
  applicable laws, the options to be granted to Employee shall be granted as
  incentive options.  All options
  granted to Employee hereunder shall vest immediately upon a Change of Control
  (as hereinafter defined).  The options
  will be granted pursuant to a stock option agreement to be executed by
  Employee and the Company as of the date hereof, which shall provide, among
  other things, that the options will vest in four equal annual installments
  beginning one year from the date of this Agreement.

  
					

 

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

 

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

 

	
   

  	
   

  	
  (ii)

  	
  In addition, Employee shall be eligible to
  receive future stock option grants, as determined by the Compensation
  Committee.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  Merger
  Transition Award.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (i)

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

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (ii)

  	
  In the event of a Change of Control (as
  hereinafter defined), any remaining unpaid amount of the Merger Transition
  Award shall be paid in full; provided, however, that this subsection (ii)
  shall not apply to a Change of Control resulting from action by the directors
  or management of the Company or their affiliates.

  

 

Section 3.2  Benefits.  During the term of this Agreement, Employee
shall be afforded the following benefits as incidences of his employment:

 

(a)                                 Business and Entertainment Expenses.  Subject
to the Company’s standard policies and procedures with respect to expense
reimbursement as applied to its executive employees generally, the Company will
reimburse Employee for, or pay on behalf of Employee, reasonable and
appropriate expenses incurred by Employee for business related purposes,
including dues and fees to approved industry and professional organizations,
and reasonable costs of entertainment incurred in connection with business
development.

 

(b)                                Club Membership.  The Company shall reimburse Employee for
membership dues at social or country clubs designated by Employee as mutually
agreed by the Company and Employee.

 

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

 

Section 3.3  Payroll.  Employee shall receive all compensation
pursuant to this Agreement in accordance with the Company’s Provo, Utah
customary payroll practices with respect to time and manner of payment.

 

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ARTICLE IV

EFFECT OF TERMINATION ON COMPENSATION

 

Section 4.1  By the
Company.

 

(a)                                 Termination Upon Death.  In the event of Employee’s
death during the term of this Agreement, this Agreement will terminate upon the
first day of the month following the Employee’s date of death, and all of
Employee’s rights and benefits provided for in this Agreement will terminate as
of such date; provided, however, that Employee’s estate will be paid
Employee’s annual salary and pro rata bonus through the date of death for a
period of six months after such death occurs and, provided, further, all stock
options referenced in Section 3.1(c) shall vest on Employee’s death, and
Employee’s estate may exercise such options for a period of one year from the
date of termination and, provided further that, the Merger
Transition Award shall be paid in full within three months after such death
occurs.

 

(b)                                Termination Upon Disability.  If
Employee’s employment hereunder is terminated by the Company pursuant to
Section 2.2(b) hereof prior to the expiration of the then current term, all
of Employee’s rights and benefits provided for in this Agreement will terminate
as of such date; provided, however, that Employee will be paid Employee’s
annual salary and pro rata bonus through the date of termination for a period
of six months after such termination occurs and, provided, further, all stock
options referenced in Section 3.1(c) shall vest effective as of the
termination date, and Employee may exercise such options for a period of one
year from the date of termination and, provided further, that, the Merger
Transition Award shall be paid in full within six months after such termination
occurs.

 

(c)                                 Termination for Cause.  Employer shall be entitled to
terminate Employee’s employment at any time for cause, as defined by
Section 2.2(c). In the event of termination for cause, all of Employee’s
rights and benefits provided for in this Agreement shall terminate, except as
to any accrued and unpaid base salary provided for in Section 3.1(a).

 

(d)                                Termination After Change of Control.  Except as
set forth in Section 3.1(d)(ii), if, within 24 months following a
Change of Control (as hereinafter defined), the Company or its successor
terminates Employee’s employment without cause or by Constructive Termination,
Employee will 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 four
quarters in the year in which such termination occurs and (B) the actual
bonus earned by Employee for the four fiscal quarters immediately preceding
such termination. All unvested stock options referenced in Section 3.1(c)
shall vest effective as of the date of termination and Employee may exercise
such options for a period of 90 days from the date of termination.
Employee shall receive his accrued and unpaid salary and any accrued and unpaid
pro rata bonus through the date of termination, and Employee will continue to
participate in any benefits referenced in Section 3.2(c) for a period of
two years from the date of termination; 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 the Company, the Company shall pay Employee an
amount in cash equal to the economic value of such benefit, such value to be
determined as of the time of termination.

 

In the event
that Employee is deemed to have received an excess parachute payment (as such
term is defined in Section 280G(b) of the Internal Revenue Code of 1986,
as amended (the

 

5

 

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

 

“Change of
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
  Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a
  “Person”), of beneficial ownership (within the meaning of Rule 13d-3
  promulgated under the Exchange Act) of 50% or more of either (A) the
  then outstanding shares of common stock of the Company or (B) the
  combined voting power of the then outstanding voting securities of the
  Company entitled to vote generally in the election of directors; provided,
  however, that the following acquisitions shall not constitute a Change of
  Control under this subsection (i): (x) any acquisition directly from the
  Company (excluding an acquisition by virtue of the exercise of a conversion
  privilege), (y) any acquisition by the Company, or (z) any
  acquisition by any employee benefit plan (or related trust) sponsored or
  maintained by the Company or any corporation controlled by the Company; or

  
	
   

  	
   

  	
   

  
	
   

  	
  (ii)

  	
  Individuals who, as of the effective date
  hereof, constitute the Board of Directors (the “Incumbent Board”) cease for
  any reason to constitute at least a majority of the Board; provided, however,
  that any individual becoming a director subsequent to the effective date
  hereof whose election, or nomination for election by the Company’s
  stockholders, was approved by a vote of at least a majority of the directors then
  comprising the Incumbent Board shall be considered as though such individual
  were a member of the Incumbent Board, but excluding, for this purpose, any
  such individual whose initial assumption of office occurs as a result of
  either an actual or threatened election contest (as such terms are used in
  Rule 14a-11 of Regulation 14A promulgated under the Exchange Act)
  or other actual or threatened solicitation of proxies or 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 or dissolution of the Company or the sale or other
  disposition of all or substantially all of the assets of the Company.

  

 

(e)                                 Other Events Upon Termination.  If
Employee’s employment hereunder shall be terminated by the Company without
cause or by Constructive Termination other than within 24 months following a
Change of Control, Employee shall receive in accordance with the Company’s then
current payroll practices an amount equal to the sum of (i) Employee’s
annual base salary for the year in which such termination occurs and
(ii) the greater of (A) the target bonuses for each of the four
quarters in the year in which such termination occurs and (B) the actual
bonus earned by Employee for the four fiscal quarters immediately preceding
such termination, payable for a period of time equal to the longer of
(i) two years and (ii) the period of time remaining under the then
current term of this Agreement (such longer period, the “Severance Period”).
Employee shall receive his accrued and unpaid salary and any accrued and unpaid
pro rata bonus through the date of termination, and Employee will continue to
participate in any benefits referenced 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 in
cash equal to the economic value of such benefit, such value to be determined
as of the time of termination. In addition, all stock options referenced in
Section 3.1(c) shall vest effective as of the date of termination, and
Employee may exercise such options for a period of three months from the date
of termination and provided, further, that the Merger
Transition Award shall be paid in full upon the date of termination.

 

Section 4.2  By Employee.

 

(a)                                 Breach of Agreement by Company.  If
Employee’s employment hereunder shall be terminated by Employee pursuant to the
provisions set forth in Section 2.3(a) hereof prior to the expiration of
the then current term of this Agreement, Employee shall receive in accordance
with the Company’s then current payroll practices an amount equal to the sum of
(i) Employee’s annual base salary for the year in which such termination
occurs and (ii) the greater of (A) the target bonuses for each of the
four quarters in the year in which such termination occurs and (B) the
actual bonus earned by Employee for the four fiscal quarters immediately
preceding such termination, payable for a period of time equal to the longer of
(i) two years and (ii) the period of time remaining under the then
current term of this Agreement. Employee shall receive his accrued and unpaid
salary and any accrued and unpaid pro rata bonus through the date of
termination, and Employee will continue to participate in any benefits
referenced 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 the
Company, the Company shall pay Employee an amount in cash equal to the economic
value of such benefit, such value to be determined as of the time of termination.
In addition, all stock options referenced in Section 3.1(c) shall vest
effective as of the date of termination, and Employee may exercise such options
for a period of three months from the date of termination and provided,
further, that, the Merger Transition Award shall be paid in
full upon the date of termination.

 

(b)                                Voluntary Resignation.  If Employee’s employment
hereunder shall be terminated by Employee pursuant to the provisions set forth
in Section 2.3(b) hereof prior to the expiration of the then current term,
then, upon such termination, subject to COBRA, all compensation and all
benefits to Employee hereunder shall terminate contemporaneously with the
termination of such employment; provided, however, Employee shall not
receive a bonus for the year during which Employee’s employment terminated or
any subsequent year, and provided, further,
that any Employee shall not receive any additional unpaid amounts of the Merger
Transition Award.

 

ARTICLE V

CONFIDENTIAL INFORMATION

 

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

 

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

 

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

 

Section 5.3  Return of
Documents.  All written
materials, records and other documents made by, or coming into the possession
of, Employee during the period of his employment by the Company which contain
or disclose the Confidential Information shall be and remain the property of
the Company. Upon request, and in any event upon termination of Employee’s
employment by the Company, for any reason, he promptly shall deliver the same,
and all copies, derivatives and extracts thereof, to the Company.

 

ARTICLE VI

INVENTIONS, DISCOVERIES AND COPYRIGHTS

 

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

 

Section 6.2  Copyrights.  If during Employee’s employment by the
Company, Employee creates any original work of authorship (each, a “Work”)
fixed in any tangible medium of expression which is the subject matter of
copyright (e.g.,
written presentations, computer programs, videotapes, drawings, maps, models,
manuals or brochures) relating to the Company’s business, products, or
services, whether a Work is created solely by Employee or jointly with others,
the Company shall be deemed the author of a Work if the Work is prepared by
Employee in the scope of his employment; or, if the Work is not prepared by
Employee within the scope of his employment but is specially ordered by the
Company as a contribution to a collective work, as a part of a motion picture
or other audiovisual work, as a translation, as a supplementary work, as a
compilation or as an instructional text, then the Work shall be considered to
be a work made for hire and the Company shall be the author of the Work. In the
event a Work is not prepared by Employee within the scope of his employment or
is not a Work specially ordered and deemed to be a work made for hire, then
Employee hereby agrees to assign, and by these presents, does assign, to the
Company all of Employee’s worldwide right, title and interest in and to such
Work and all rights of copyright therein. Both during the period of Employee’s
employment by the Company and thereafter, Employee agrees to assist the Company
and its nominee, at any time, in the protection of the Company’s worldwide
right, title and interest in and to the work and all rights of copyright
therein, including but not limited to, the execution of all formal assignment
documents requested by the Company or its nominee and the execution of all lawful
oaths and

 

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applications for registration
of copyright in the United States and foreign countries.

 

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

 

ARTICLE VII

NON-COMPETITION

 

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

 

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

 

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

 

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

 

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

 

Notwithstanding the foregoing, in the event of termination of this
Agreement pursuant to Section 4.1(d), 4.1(e) or 4.2(a), the prohibitions
of this Article VII shall no longer apply at such time as Employee waives
his right to receive any further payments under Section 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 his ability to engage in a
business similar to the Company’s business in specific areas of the world for
the Non-Competition Period, but acknowledges that he will receive sufficiently
high remuneration and other benefits from the Company hereunder to justify such
restriction. In addition to any remedies provided under applicable law, the
Company and Employee agree that during the period the Company is paying
compensation and benefits to Employee pursuant to Articles III or IV hereof,
the Company’s remedy for breach of the provisions of this Article VII
shall include, but shall not be limited to, the termination of all compensation
and all benefits to Employee otherwise provided under this Agreement.

 

9

 

Section 7.3  It is
expressly understood and agreed that the Company and Employee consider the
restrictions contained in Section 7.1 hereof to be reasonable and
necessary for the purposes of preserving and protecting the good will and
proprietary information of the Company, nevertheless, if any of the aforesaid
restrictions is found by a court having jurisdiction to be unreasonable, over
broad as to geographic area or time or otherwise unenforceable, the parties
intend for the restrictions therein set forth to be modified by such court so
as to be reasonable and enforceable and, as so modified by the court, to be
fully enforced.

 

ARTICLE VIII

SOLICITATION OF EMPLOYEES

 

During the term of his employment by the Company and thereafter for the
Non-Competition Period, Employee shall not, on his own behalf or on behalf of
any other person, partnership, entity, association, or corporation, hire or
seek to hire any non-clerical or non-secretarial employee of the Company or in
any other manner attempt directly or indirectly to influence, induce, or encourage
any non-clerical or non-secretarial employee of the Company to leave the
employment of the Company, nor shall he use or disclose to any person,
partnership, entity, association, or corporation any information concerning the
names, addresses or personal telephone numbers of any employees of the Company.

 

ARTICLE IX

MISCELLANEOUS

 

Section 9.1  Notices.  For purposes of this Agreement, notices and
all other communications provided for herein shall be in writing and shall be
deemed to have been duly given when personally delivered or when mailed by
United States registered or certified mail, return receipt requested, postage
prepaid, addressed as follows:

 

	
  If to the Company to:

  	
  INVESTools Inc.

  5959 Corporate Drive, Suite 2000

  Houston, TX  77036

  Attention: Chairman of the Compensation Committee

   

  
	
   

  	
   

  
	
  If to Employee to:

  	
  Ross Jardine

  116 S. Pfeifferhorn Dr.

  Alpine, UT  84004

   

  

 

or to such other address as either party may
furnish to the other in writing in accordance herewith, except that notices of
changes of address shall be effective only upon receipt.

 

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

 

Section 9.3  No Waiver.  No failure by either party hereto at any
time to give notice of any breach by the other party of, or to require
compliance with, any condition or provision of this Agreement shall (i) be
deemed a waiver of similar or dissimilar provisions or conditions at the same
or at any prior or

 

10

 

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

 

Section 9.4 
Severability.  If a
court of competent jurisdiction determines that any provision of this Agreement
is invalid or unenforceable, then the invalidity or unenforceability of that
provision shall not affect the validity or enforceability of any other
provision of this Agreement, and all other provisions shall remain in full force
and effect.

 

Section 9.5 
Counterparts.  This
Agreement may be executed in one or more counterparts, each of which shall be
deemed to be an original, but all of which together will constitute one and the
same Agreement.

 

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

 

Section 9.7  Headings.  The paragraph headings have been inserted
for purposes of convenience and shall not be used for interpretive purposes.

 

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

 

Section 9.9  Assignment.  This Agreement, and the rights and
obligations of the parties hereunder, are personal and neither this Agreement,
nor any right, benefit or obligation of either party hereto, shall be subject
to voluntary or involuntary assignment, alienation or transfer, whether by
operation of law or otherwise, without the prior written consent of the other
party except that vested rights to payment shall be subject to devise, and
shall descend in accordance with applicable laws of inheritance.

 

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

 

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

 

Section 9.11  Term. This Agreement has a term co-extensive
with the term of employment as defined in Section 2.1 hereof. Termination
of this Agreement pursuant to the provisions of Section 2.1 hereof shall
not affect any right or obligation of either party hereto which is accrued or
vested prior to or upon such termination 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 with regard to the subject
matter hereof, and contains all the covenants, promises, representations,
warranties and agreements between the parties with respect to employment of
Employee by the Company. Each party to this Agreement acknowledges that no
representation, inducement, promise or agreement, oral or written, has been
made by either party, or by anyone acting on behalf of either party, which is
not embodied herein, and that no agreement, statement, or promise relating to
the employment of Employee by

 

11

 

the Company, 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 writing and signed by the party to be charged.

 

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

 

	
   

  	
  INVESTools Inc.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/  PAUL A. HELBLING

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  Paul A. Helbling

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/ 
  ROSS JARDINE

  	
   

  
	
   

  	
  Ross Jardine

  
								

 

12Exhibit 10.35

 

TRANSITION SETTLEMENT AGREEMENT

 

This license
and collaboration Agreement (“Agreement”) is made effective as of the Effective
Date given on the signature page and entered into at Provo, Utah, USA, by and
among the following parties:

(1)   Online Investors Advantage
Incorporated , a Utah corporation, located at 5252 North Edgewood Drive, Suite
325, Provo, Utah 84604 (“Online”);

(2)   Hon Leong Chong, an
individual, whose Singapore passport number is S0004804F and is residing at 10G
Braddel Hill #04-28, Singapore 57926 (“Chong”);

(3)   Eric Lip Meng Tan, an
individual, whose Singapore passport number is S1349197I and is residing at 279
Balestier Road #07-07, Balestier Point, Singapore 329727 (“Tan”) (hereinafter
the individuals, Chong and Tan, are collectively called Chong & Tan”);

(4)   Investools Asia Pacific Pte.
Ltd., a Singapore company, having a business address of 20 Kallang Avenue,
Level One PICO Creative Centre, Singapore 339411 (Singapore Co.”); and

(5)   Investools Hong Kong
Limited, a Hong Kong company, having a business address.of 29th
Floor, Wing On Centre, 111 Connaught Road Central, Hong Kong, China 766698
(“Hong Kong Co.”), the Singapore Co. and the Hong Kong Co. being referred to
herein individually and collectively as the “Licensees”.

 

Any or all of the above parties shall be referred to herein as “Party”.

 

A.  WHEREAS,
the parties are currently executing an agreement entitled “License and
Collaboration Agreement,” effective August 1, 2002, defining their relationship
with respect to Online’s business being conducted by Licensees in Singapore,
Hong Kong Malaysia and Brunei.

 

B.  WHEREAS,
the parties, effective August 1, 2002, terminated a prior agreement previously
defining their relationship, entitled “Joint Venture Agreement” dated September
27, 2001.

 

C.  WHEREAS,
the parties desire to settle all accounts, amounts due, claims and other
outstanding financial matters arising under the Joint Venture Agreement.

 

NOW, THEREFORE, the Parties to this Agreement do hereby agree to the
following terms and conditions:

 

1.  Transition Expenses, Accounts Payable,
Assets

 

1.1  The Parties acknowledge that a prior
agreement between Online and Chong & Tan, namely the prior Joint Venture
Agreement previously effective on September 27, 2001, was terminated by a
notice letter from Online to Chong & Tan, effective August 1, 2002 (“Prior
Agreement”).  Although the Effective
Date of the present Agreement is August 1, 2002, Licensees and possibly Chong
& Tan will have incurred expenses and disbursed payments (“Transition
Expenditures”) during the period between August 1, 2002 and the Effective Date
given below.

 

1

 

1.2  The Parties agree that no Transition
Expenses shall be included as a part of Licensees’ Expenses under the License
and Collaboration Agreement, except to the extent that those Transition
Expenses, if any, are listed in Exhibit 1, attached hereto and
incorporated herein.

 

1.3  The Parties agree that the Accounts Payable,
as of August 1, 2002, is indicated in Exhibit 2, attached hereto and
incorporated herein.

 

1.4   The Parties agree that the a correct
Summary of Assets, as of August 1, 2002 is indicated in Exhibit 3,
attached hereto and incorporated herein.

 

2.  Prior Claims

 

2.1  It is understood that the Licensees and/or
Chong & Tan have claimed that Online should reimburse them for all unpaid
costs, charges, reimbursements, or other monies or funds that occurred prior to
termination of the prior Joint Venture Agreement and that are owed or claimed
to be owed to Licensees or to Chong & Tan, or made by any other person or
entity, individually or collectively, in the amount of One Hundred and Four
Thousand US Dollars (US$104,936.12) as documented in Exhibit 4, an
expense summary email message, with its five attachments, attached hereto and
incorporated herein. (collectively the “Prior Claims”).

 

2.2  Upon the execution of this Agreement by all
Parties, Online shall pay Licensees together in full settlement for all such
Prior Claims, the amount of Seventy Thousand U.S. Dollars ($US 70,000.00).
(“Expense Reimbursement”).  Licensees,
and Chong & Tan hereby represent, warrant and agree that the payment of
this Expense Reimbursement shall be in full settlement for any such Prior
Claims, except to the extent that differences are determined by the Audit
described in Section 4, herein.

 

2.3  Conditional upon payment of the Expense
Reimbursement to License, the Licensees, and Chong & Tan do hereby release
Online from any and all such Prior Claims, whether known now or in the future,
except to the extent that differences are determined by the Audit described in
Section 4, herein.

 

3. 
Account B Settlement

 

3.1  The parties understand that the amount in
Account B under the Prior Agreement as of August 1, 2002 was One Hundred and
Sixty Two Thousand, Nine Hundrred and Eighty Five Singapore Dollars and
Seventy-Seven cents. (S $162,985.77). (“Account B Amount”).

 

3.2  Under the Prior Agreement, Chong & Tan
were entitled to all amounts in Account B after all expenses were paid.  Chong & Tan hereby represent and warrant
that the Account B Amount was the correct amount in Account B after all
expenses required to be paid out of Account B were paid.  Based on that representation, Online shall
pay the Account B Amount to Chong & Tan, to be divided between them, in any
manner they desire.

 

2

 

4. 
Audit

 

4.1  Online may, with reasonable notice and
within normal business hours, at its own expense, conduct an audit of the books
and records of each of the Licensees and make whatever copies it desires of the
same (“Audit”).  The Audit may include,
but is not limited to, a full review of the books and records of Licensees
under the Prior Agreement and during the Transition Period, as well as under
the current Agreement, including a review of all Licensees’ expenses, payments
and charges under Accounts A and B and all Transition Expenses.

 

4.2  The Audit shall also include an examination
of the books and records relating to the Account B Amount and the Prior Claims
Amount.  Should the Audit determine that
the Account B Amount should be a different amount than that stated herein
(“Audited Account B Amount”), then the Audited Account B Amount shall be subtracted
from the Account B Amount stated herein to determine the difference (“Account B
Difference”).  Should the Audit
determine that the Prior Claims Amount should be a different amount than that
stated herein (“Audited Prior Claims Amount”), then the Audited Prior Claims
Amount shall be subtracted from the Prior Claims Amount stated herein to
determine the difference (“Prior Claims Difference”).

 

4.3  In the event that Online determines that the
combined amounts of the Account B Difference and the Prior Claims Difference
total more than Ten Thousand US Dollars (US$10,000.00) (“Threshold Amount”),
then the following payment or payments shall be made:

 

(a) if the
Account B Difference is a negative number, Online shall pay to Chong & Tan
the Account B Difference,

 

(b) if the
Account B Difference is a positive number, Chong & Tan shall pay to Online
the Account B Difference,

 

(c) if the
Prior Claims Difference is a negative number, Online shall calculate the
percentage of the Prior Claims Difference over the stated Prior Claims Amount
(“First Percentage”), and Online shall pay to Chong & Tan an amount equal
to the First Percentage times the Expense Reimbursement, and

 

(d) if the
Prior Claims Difference is a positive number, Online shall calculate the
percentage of the Prior Claims Difference over the stated Prior Claims Amount
(“Second Percentage”), and Chong & Tan shall pay to Online an amount equal
to the Second Percentage times the Expense Reimbursement

 

5.  Payment Schedule

 

5.1  The Parties agree that the above amounts
shall be paid from the Singapore Co. Account A bank account to Rejoice Edumedia
Pte Ltd (“Rejoice”) and Cappi Management Pte Ltd (“Cappi”) immediately upon
their presentation of their respective invoices, according to the following
schedule:

 

3

 

Expense
Reimbursement – To be paid on 13 December 2002, as follows:

 

To Rejoice –
US$35,000.00

To Cappi –
US$35,000.00

 

Account B
Amount – To be paid on 2 January 2003, as follows:

 

To Rejoice – S
$43,592.89

To Cappi – S
$9,392.89

 

6. 
General Provisions

 

6.1  Relationship of the Parties.  This
Agreement does not constitute any Party as the agent or legal representative of
the other Party for any purpose whatsoever. 
No Party is granted any express or implied right or authority by any
other Party to assume or to create any obligation or responsibility on behalf
of, or in the name of, the other Party, or to bind the other Party in any
manner or thing whatsoever.

 

6.2  Law.  This Agreement shall be governed
by and construed in accordance with The laws of the country where legal
proceedings are brought, as provided in Paragraph 6.2, without regard to
conflict of laws provisions.

 

6.3  Jurisdiction/Venue.  If
any dispute arises out of this Agreement, it is agreed that jurisdiction and
venue for any legal proceedings brought by Licensees, and/or Chong or Tan
against Online shall lie exclusively in a competent court in the County of Salt
Lake, Utah, U.S.A.  Jurisdiction and
venue for any legal proceedings brought by Online against Licensees, Chong,
Tan, shall lie exclusively in the courts of Singapore.  Licensees and Chong & Tan irrevocably
submit to the non-exclusive jurisdiction and venue of the courts of Singapore.
The existence of legal proceedings between the Parties in one or more
jurisdictions shall not preclude the undertaking of legal proceedings in any
other jurisdiction, whether concurrent or not.

 

6.4  Attorneys’ Fees.  If
this Agreement gives rise to a lawsuit or other legal proceeding between any of
the Parties hereto, the prevailing Party shall be entitled to recover court
costs, necessary disbursements (including without limitation expert witnesses’
fees) and reasonable attorneys’ fees, in addition to any other relief such
Party may be entitled.  This provision
shall be construed as applicable to the entire contract.

 

6.5  Binding on Heirs.  This Agreement shall be binding on and shall
inure to the benefit of the heirs, executors, administrators, successors, and
assigns of the Parties.

 

6.6  Entire Agreement/Modification.  This
Agreement supersedes any and all other agreements, either oral or in writing,
between the Parties hereto with respect to the subject matter hereof, and no
other agreement, statement, or promise relating to the subject matter of this
Agreement that is not contained herein shall be valid or binding.  Any modification of this Agreement will be
effective only if it is in writing.

 

4

 

6.7  Assignment.  Chong & Tan may
not assign any right or interest arising under this Agreement without the prior
written consent of Online.  Online may
assign any right or interest it has under this Agreement.

 

6.8  Severability.  If any provision in
this Agreement is held by a court of competent jurisdiction to be invalid,
void, or unenforceable, the remaining provisions shall nevertheless continue in
full force without being impaired or invalidated in any way.

 

6.9  Waiver.  The waiver by any Party of any
breach of a provision of this Agreement by the other Party shall not constitute
a continuing waiver or a waiver of any subsequent breach of the same or of a
different provision of this Agreement. 
Except as otherwise specifically provided in this Agreement, nothing
contained herein shall be deemed to restrict or prevent any Party from
exercising legal or equitable rights or from pursuing legal or equitable
remedies in connection herewith.

 

Effective
Date:                                                                 

 

IN WITNESS
WHEREOF, the Parties hereto have executed this Agreement as of the date first
written above.

 

ONLINE
INVESTORS ADVANTAGE INCORPORATED

 

	
  /s/ PAUL A. HELBLING

  	
   

  	
  INVESTOOLS ASIA PACIFIC PTE LTD

  
	
  By:

  	
  Paul Helbling

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ CHONG HON LEONG

  	
   

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
   

  
	
   

  	
   

  	
  Printed Name:

  	
  Hon Leong Chong

  	
   

  
	
  /s/ DAVID W. MCCOY

  	
   

  	
   

  
	
  By:

  	
  David McCoy

  	
   

  	
  Title:

  	
  President

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  President

  	
   

  	
  INVESTOOLS HONG KONG LIMITED

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  TAN LIP MENG

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Printed
  Name:

  	
  Tan
  Lip Meng

  	
   

  
	
  /s/ CHONG HON LEONG

  	
   

  	
   

  
	
  Hon Leong Chong, Individually

  	
   

  	
  Title:

  	
  Director

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ TAN LIP MENG

  	
   

  	
   

  
	
  Eric Tan, individually

  	
   

  	
   

  
												

 

 

Note: Exhibits 1, 2,
3 and 4 are attached hereto and initialed by the parties

 

5

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