Employment Agreement - CARLO BARAVALLE

N2K INC.



EMPLOYMENT AGREEMENT





LAWRENCE L. ROSEN TABLE OF CONTENTS



Page

1. POSITION AND RESPONSIBILITIES...................................... 1



2. TERM............................................................... 1



3. COMPENSATION AND REIMBURSEMENT..................................... 2



4. PAYMENTS TO EXECUTIVE UPON AN EVENT OF TERMINATION................. 4



5. CHANGE IN CONTROL.................................................. 5



6. TERMINATION UPON RETIREMENT, DEATH, AND DISABILITY................. 6



7. TERMINATION FOR CAUSE.............................................. 7



8. NOTICE............................................................. 7



9. CONFIDENTIALITY.................................................... 8



10. NON-COMPETITION.................................................... 8



11. SOURCE OF PAYMENTS................................................. 9



12. EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFITS PLANS............. 9



13. NO ATTACHMENT...................................................... 9



14. MODIFICATION AND WAIVER............................................ 9



15. SEVERABILITY....................................................... 10



16. HEADINGS FOR REFERENCE ONLY........................................ 10



17. GOVERNING LAW...................................................... 10



18. PAYMENT OF LEGAL FEES.............................................. 10



19. INDEMNIFICATION.................................................... 10



20. SUCCESSOR TO THE COMPANY........................................... 11



EMPLOYMENT AGREEMENT



This AGREEMENT is made effective as of February 13, 1996 by and between N2K Inc. (the "Company"), a corporation organized under the laws of Pennsylvania, with its principal administrative office at 55 Broad Street, New York, New York 10004 and Lawrence L. Rosen (the "Executive").



WHEREAS, the Company wishes to assure itself of the services of Executive for the period provided in this Agreement; and



WHEREAS, the Executive is willing to serve in the employ of the Company on a full-time basis for said period.



NOW, THEREFORE, in consideration of the mutual covenants herein contained, and upon the other terms and conditions hereinafter provided, the parties hereby agree as follows:



1. POSITION AND RESPONSIBILITIES.



During the period of his employment hereunder, Executive agrees to serve as Chairman and Chief Executive Officer of the Company. The Executive shall serve as a full time employee of the Company to perform such duties as the Company may from time to time reasonably direct. The Executive's responsibilities will include, among other things, (i) developing and assisting in the development of new products and business for the Company, (ii) supervising the preparation and development of budgets for the Company for approval by the Board of Directors, and (iii) developing and directing the Company's online services, CD-ROM capabilities and media and technology areas. During said period, Executive also agrees to serve, if elected, as an officer and director of any subsidiary of the Company. Notwithstanding the above, the Executive may maintain his interests existing as of the date hereof in the entities set forth on Schedule 1 hereto (the "Permitted Interests") so long as the services rendered by the Executive in connection with the Permitted Interests do not substantially interfere with the Executive's performance of his duties under this Agreement.



2. TERM.



(a) The period of Executive's employment under this Agreement shall be deemed to have commenced as of the date hereof, and shall continue for a period of forty-eight (48) full calendar months thereafter (the "Expiration Date"). Unless written notice shall have been delivered by the party desiring to terminate this Agreement, which written notice shall have been delivered not later than 120 days prior to the Expiration Date (including the Expiration Date with respect to any renewed term), this Agreement shall be renewed for consecutive one (1) year periods.



(b) During the period of his employment hereunder, except for periods of absence occasioned by illness, and reasonable vacation periods, Executive shall devote substantially all his business time, attention, skill, and efforts to the faithful performance of his duties hereunder including activities and services related to the organization, operation and management of the Company; provided, however, that, with the approval of the Board of Directors of the Company (the "Board"), as evidenced by a resolution of such Board, from time to time, Executive may serve, or continue to serve, on the boards of directors of, and hold any other offices or positions in, companies or organizations, which, in such Board's judgment, will not present any conflict of interest with the Company, or materially affect the performance of Executive's duties pursuant to this Agreement.



(c) Notwithstanding anything herein contained to the contrary: (i) Executive's employment with the Company may be terminated by the Company or Executive during the term of this Agreement, subject to the terms and conditions of this Agreement; and (ii) nothing in this Agreement shall mandate or prohibit a continuation of Executive's employment following the expiration of the term of this Agreement upon such terms and conditions as the Board and Executive may mutually agree.



3. COMPENSATION AND REIMBURSEMENT.



(a) The compensation specified under this Agreement shall constitute the salary and benefits paid for the duties described in Section 1. The Company shall pay Executive as compensation a salary of not less than $200,000 per year ("Base Salary"). Such Base Salary shall be payable in accordance with the Company's payroll practice in effect from time to time. During the period of this Agreement, Executive's Base Salary shall be reviewed at least annually; the first such review will be made no later than one year from the date of this Agreement. Such review shall be conducted by a Committee designated by the Board, and the Board may increase Executive's Base Salary. An increase shall become the "Base Salary" for purposes of this Agreement. In addition to the Base Salary provided in this Section 3(a), the Company shall also provide Executive at no cost to Executive with all such other benefits as are provided uniformly to permanent full-time employees of the Company.



(b) The Executive shall also receive an annual bonus amount to be determined by the Board, provided such bonus shall be in an amount of not less than $50,000.00 (the "Annual Bonus") until such time as Executive's Base Salary has increased to at least $250,000 per year; thereafter, Executive shall continue to be entitled to receive an annual bonus in an amount to be determined by the Board in its



sole discretion. The Executive shall only be eligible for an annual bonus as long as the Executive remains an employee of the Company.



(c) The Executive will be entitled to five (5) weeks paid vacation annually. The Company will provide the Executive, at Executive's election, with either (i) an automobile allowance of not less than $800 per month or (ii) the use of an automobile throughout the term hereof and the Company will pay for all automobile insurance and all operating costs (i.e., gas, tolls, parking fees, etc.) associated with the Executive's use of the Executive's automobile in fulfillment of the Executive's duties under this Agreement. The Executive will be entitled to participate in or receive benefits under any employee benefit plans including, but not limited to, retirement plans (i.e., 401(k) plans), supplemental retirement plans, pension plans, profit-sharing plans, health-and-accident plan, medical coverage or any other employee benefit plan or arrangement made available by the Company currently or in the future to its senior executives and key management employees, subject to and on a basis consistent with the terms, conditions and overall administration of such plans and arrangements. Executive will be entitled to incentive compensation and bonuses as provided in any plan of the Company in which Executive is eligible to participate. Nothing paid to the Executive under any such plan or arrangement will be deemed to be in lieu of other compensation to which the Executive is entitled under this Agreement. In addition the Company shall obtain term life insurance, naming the Executive's designee as beneficiary, in the face amount, at all times, equal to the maximum allowable amount under the Company's existing insurance policy.



(d) In addition to the Base Salary provided for by paragraph (a) of this Section 3 and other compensation provided for by paragraphs (b) and (c) of this Section 3, the Company shall pay or reimburse Executive for all reasonable travel and other reasonable expenses incurred by Executive performing his obligations under this Agreement.



(e) Simultaneously with the execution of this Agreement, the Company shall grant to the Executive, pursuant to a stock option agreement satisfactory to the Executive, incentive stock options to purchase 500,000 shares of common stock and additional non-qualified options to purchase 421,098 shares of common stock of the Company at an exercise price of $.80 per share (being the present fair market value of such stock). In the event Executive is a holder of more than ten percent (10%) of the combined voting power of the Company at the time of the grant, the exercise price of any incentive stock option shall be $.88 per share in accordanc ...