EXHIBIT 10.21
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CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT, dated as of June 5, 2000 (the "Agreement"),
by and between 800 TRAVEL SYSTEMS, INC., a Florida corporation, (the "Company"),
and MARK MASTRINI, a Florida corporation, (the "Consultant").
WHEREAS, the Company is presently engaged in the business of
providing travel services to consumers through call centers and the Internet;
WHEREAS, Consultant has previously served as the Company's
Chief Executive Officer and is familiar with the Company's history and
operations and is therefore able to provide valuable consulting services as an
independent contractor; and
WHEREAS, the Company wishes to assure itself of the continued
services of the Consultant for the period provided in this Agreement and the
Consultant is willing to serve the Company for such period upon the terms and
conditions hereinafter set forth.
NOW THEREFORE, in consideration of the mutual covenants herein
contained, the parties, intending to be legally bound, hereby agree as follows:
1. ENGAGEMENT
The Company hereby retains Consultant to provide consulting
and advisory services upon the terms and conditions herein contained, and the
Consultant hereby agrees to accept such engagement for the term described below.
2. SERVICES
During the term of this Agreement, Consultant shall provide
the Company with the following business advisory services:
(i) assisting the Company in finalizing initiatives
commenced during Consultant's previous employment with the
Company as its Chief Executive Officer;
(ii) assisting the Company in the evaluation of
strategic relationships;
(iii) assisting the Company in the review and
assessment of potential business relationships;
(iv) assisting the Company with legal proceedings
relating to matters occurring during the time of Consultant's
previous employment with the Company as its Chief Executive
Officer; and
(v) such other related services as reasonably
requested by the Company from time to time.
3. TERM OF AGREEMENT
The term of this Agreement shall be one year and commence as
of June 5, 2000 (the "Effective Date").
<PAGE>
4. CONSULTING ACTIVITY
The Consultant agrees to provide consulting services at
mutually agreeable times and places during the term of this Agreement not
exceeding one day per month for personal appearances which must be requested at
least two weeks in advance. It is understood and agreed that Consultant is an
independent contractor in the performance of this Agreement and that Consultant
shall perform the consulting activities under the control of the Company as to
the result of such activities and not as to the means by which such result is
accomplished. Consultant shall not have the authority to obligate or commit the
Company in any manner whatsoever. Nothing herein shall constitute Consultant as
an employee, partner or agent of the Company.
5. COMPENSATION
The Consultant shall be entitled to receive a one time base
fee payment of $115,000 at the time of execution of this Agreement.
As additional compensation for the services rendered
hereunder, the Consultant shall receive a monthly fee of $5,416.67 during the
twelve month term of this Agreement, payable in monthly installments beginning
upon the execution of this Agreement.
6. RESOURCES The Company shall make available reasonable resources to
Consultant for the performance of the services contemplated hereby.
7. BUSINESS EXPENSES The Company shall reimburse the Consultant for all
reasonable expenses Consultant incurs in connection with the Company's business,
upon presentation by the Consultant from time to time of an itemized account of
such expenditures.
8. PAYMENTS UPON TERMINATION
(a) INVOLUNTARY TERMINATION. If the Consultant's engagement is
terminated by the Company during the term of this Agreement, the Consultant
shall be entitled to receive Consultant's base fee and any unpaid additional
fees accrued through the date of termination.
If the termination is not for Cause as described in paragraph
(b) or a voluntary termination by the Consultant as described in paragraph (c),
the Company shall also be obligated to make the monthly additional fee payments
to the Consultant over the remaining term of this Agreement.
(b) TERMINATION FOR CAUSE. If the Consultant's engagement is
terminated by the Company for Cause, the amount the Consultant shall be entitled
to receive from the Company shall be limited to Consultant's base fee and any
accrued through the date of termination.
For purposes of this Agreement, the term "Cause" shall be
limited to (i) the intentional and willful failure or refusal by the Consultant
to substantially perform Consultant's duties hereunder; or (ii) an act or
omission of the Consultant which constitutes a willful and material breach of
this Agreement which is not cured as specified below; or (iii) failure to
cooperate with the Company with respect to any legal proceedings relating to
periods covered by the time that Consultant was employed by the Company.
Notwithstanding the foregoing, no termination pursuant to subsection (i) or (ii)
shall be treated as termination for cause unless the Company has provided
Consultant with at least thirty (30) days prior written notice specifying in
reasonable detail the alleged breach and giving the Consultant a reasonable
opportunity to correct such breach.
<PAGE>
(d) VOLUNTARY TERMINATION BY THE CONSULTANT. If the Consultant
resigns or otherwise voluntarily terminates Consultant's engagement before the
end of the current term of this Agreement, the amount the Consultant shall be
entitled to receive from the Company shall be limited to Consultant's base fee
accrued through the date of termination.
9. EFFECT OF CHANGE IN CORPORATE CONTROL
(a) If, at any time during the period of twelve (12)
consecutive months following the occurrence of a Change in Corporate Control,
the Consultant is involuntarily terminated (other than for Cause) by the
Company, the Consultant shall be entitled to receive the balance of any
remaining unpaid monthly fees at the time of the Change in Corporate Control.
(b) For purposes of this Agreement, a "Change in Corporate
Control" shall include any of the following events:
(1) The acquisition in one or more transactions of
more than fifty-one percent (51%) of the Company's outstanding Common
Stock by any corporation, or other person or group (within the meaning
of Section 14(d)(3) of the Securities Exchange Act of 1934, as
amended);
(2) Any merger or consolidation of the Company into
or with another corporation in which the Company is not the surviving
entity, or any transfer or sale of substantially all of the assets of
the Company or any merger or consolidation of the Company into or with
another corporation in which the Company is the surviving entity and in
connection with such merger or consolidation, all or part of the
outstanding shares of Common Stock shall be changed into or exchanged
for other stock or securities of any other person, or cash, or any
other property;
(3) Any person or group of persons announces a tender
offer for at least fifty one percent (51%) of the Company's Common
Stock.
provided that, no acquisition of stock by any person in a public offering or
private placement of the Company's common stock or any other transaction
approved by the Company's Board of Directors shall be considered a Change in
Corporate Control.
10. NON-EXCLUSIVE RELATIONSHIP
Nothing contained herein shall limit nor restrict Consultant
from engaging in relationships with other companies or entities.
11. EMPLOYEES
All personnel assigned by Consultant to perform services
hereunder will be employees of Consultant and Consultant will pay all salaries
and expenses of, and all federal, social security, federal and state
unemployment taxes, and any other payroll or withholding taxes relating to such
employees.
12. PROTECTION OF CONFIDENTIAL INFORMATION
The Consultant agrees that Consultant will keep all
confidential and proprietary information of the Company or relating to its
business (including, but not limited to, information regarding the Company's
customers, pricing policies, methods of operation, proprietary computer programs
and trade secrets) confidential, and that Consultant will not (except with the
Company's prior written consent), while engaged by the Company or thereafter,
disclose any such confidential information to any person, firm, corporation,
association or other entity, other than in furtherance of Consultant's duties
hereunder, and then only to those with a "need to know." The Consultant shall
not make use of any such confidential information for Consultant's own purposes
or for the benefit of any person, firm, corporation, association or other entity
(except the Company) under any circumstances during or after the term of
Consultant's engagement. The foregoing shall not apply to any information which
is already in the public domain, or is generally disclosed by the Company or is
otherwise in the public domain at the time of disclosure.
<PAGE>
The Consultant recognizes that because Consultant's work for
the Company will bring Consultant into contact with confidential and proprietary
information of the Company, the restrictions of this Section 12 are required for
the reasonable protection of the Company and its investments and for the
Company's reliance on and confidence in the Consultant.
13. INJUNCTIVE RELIEF
The Consultant acknowledges and agrees that it would be
difficult to fully compensate the Company for damages resulting from the breach
or threatened breach of the covenants set forth in Section 12 of this Agreement
and accordingly agrees that the Company shall be entitled to temporary and
injunctive relief, including temporary restraining orders, preliminary
injunctions and permanent injunctions, to enforce such provisions in any action
or proceeding instituted in the United States District Court for the Western
District of Florida or in any court in the State of Florida having subject
matter jurisdiction. This provision with respect to injunctive relief shall not,
however, diminish the Company's right to claim and recover damages.
14. SEPARABILITY
If any provision of this Agreement shall be declared to be
invalid or unenforceable, in whole or in part, such invalidity or
unenforceability shall not affect the remaining provisions hereof which shall
remain in full force and effect.
15. ASSIGNMENT
This Agreement shall be binding upon and inure to the benefit
of the assigns and successors of the Consultant and the assigns and successors
of the Company.
16. ENTIRE AGREEMENT
This Agreement represents the entire agreement of the parties
and shall supersede any and all previous contracts, arrangements or
understandings between the Company and the Consultant, except that certain
Separation and Release Agreement dated June 5, 2000. The Agreement may be
amended at any time by mutual written agreement of the parties hereto.
17. GOVERNING LAW
This Agreement shall be construed, interpreted, and governed
in accordance with the laws of the State of Florida, other than the conflict of
laws provisions of such laws.
IN WITNESS WHEREOF, the Company and the Consultant have caused this Agreement to
be duly executed as of the day and year first above written.
CONSULTANT
By: /s/ Mark Mastrini
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Mark Mastrini
800 TRAVEL SYSTEMS, INC.
By: /s/ Peter M. Sontag
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Peter M. Sontag, CEO
<PAGE>
SCHEDULE 3
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STOCK OPTIONS
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Employee acknowledges that the following table represents the stock options that
have been granted to Employee and the exercise periods and expiration date
thereof.
<TABLE>
<CAPTION>
EXPIRATION EXERCISE
GRANT DATE SHARES DATE PRICE PLAN/NO PLAN
---------- ------ ---- ----- -----------
ISO'S NQSO'S
----- ------
<S> <C> <C> <C> <C> <C.
12/31/97 40,000 9/04/00 $5.00 97 Plan
12/31/97 10,000 12/31/07 $5.00 97 Plan
4/01/98 33,333 9/04/00 $3.00 97 Plan
9/01/98 50,000 12/31/07 $5.00 97 Plan
9/01/98 250,000 12/31/07 $5.00 No Plan
11/23/98 7,500 5/23/10 $5.50 98 Plan
-------- --------
73,333 317,500
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</TABLE>
The stock option agreements covering the above grants shall remain in full force
and effect and the options granted pursuant to option plans shall remain subject
to the terms and conditions thereof.
