EXHIBIT 10.3
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement"), is made and entered into this 1st
day of January, 2004 by and between Schoolpop, Inc. ("Company") and Xxxxxx
Xxxxxxx ("Executive").
RECITALS
WHEREAS, Executive is willing to accept such employment by Company on the terms
set forth herein; and
NOW, THEREFORE, in consideration of the mutual covenants and promises herein
contained, and other good and valuable consideration, Company and Executive
hereby agree as follows:
ARTICLE 1
EMPLOYMENT
1.1 Employment. Subject to the terms and conditions provided herein,
Company hereby agrees, for the Term (as defined in Section 3.1), to
employ Executive at no less than the Base Salary (as defined in Section
2.1). Executive shall have the title of President of the Company
reporting to Xxxx Xxxxxxxx, Chief Executive Officer and Chairman of the
Company. The Company may change the Executive's title and
responsibilities but not decrease Base Salary during the Term of this
Agreement. Executive hereby agrees to accept such employment.
1.2 Employment Duties. For the term of this Agreement, Executive shall have
the duties set forth on Exhibit "A" attached hereto. During the Term,
the Executive shall devote all of his business time, attention, skill
and effort to the business and affairs of Company and carry out his
duties and responsibilities faithfully and efficiently. It shall not be
considered a violation of the foregoing for the Executive to serve on
corporate, industry, civic, or charitable boards or committees - so
long as such activities do not conflict with, or significantly
interfere with, the performance of the Executive's responsibilities as
an employee of Company in accordance with this Agreement.
ARTICLE 2
COMPENSATION
2.1 Base Salary. During the Term, Company agrees to pay Executive a base
salary of one hundred and seventy-five thousand dollars ($175,000) per
annum (the "Base Salary"). Executive's Base Salary may be increased
during the Term at the discretion of the Company's Board of Directors.
The Base Salary shall be payable as current salary, in biweekly
installments or in accordance with any then current company pay
procedures, subject to all applicable withholdings and deductions.
2.2 Bonus based on Deferred Salary. The Company may elect to pay a bonus to
Executive for services provided during the Term. The decision to pay
any bonus and the actual payment of such bonus, if any, shall be at the
sole and absolute discretion of the Company's Board of Directors.
2.3 Expenses. Company shall reimburse Executive for all reasonable
expenses, incurred by Executive in carrying out his duties, provided,
however, Company may require an itemized accounting of expenses
reimbursed, in such detail as shall be necessary for compliance with
all applicable tax laws.
2.4 Taxes. Company shall withhold from any amounts payable under this
Agreement such federal, state or local taxes and other obligations as
shall be required to be withheld pursuant to any applicable law or
regulation.
2.5 Benefits. Executive shall participate in any medical plan, vacation and
other benefits maintained by Company for its executives.
2.6 Vehicle Allowance. The Company will provide the Executive with a
vehicle allowance of $750.00 per month during the Term. Employee
acknowledges that the payment by the Company to him of a monthly
vehicle allowance may result in taxable income if the business portion
of the vehicle expense is less than the total amount paid to Executive
under this Section 2.6, or if Executive does not maintain the records
required by the Internal Revenue Code and the regulations thereunder.
Executive has been advised to consult with a tax advisor to determine
the tax liability of payments under this Section 2.6, and the record
keeping associated with such payments.
2.7 Future Benefit Plans. Executive shall have the right to participate in
any incentive stock or cash bonus plan(s) established for Company
executives, with participation commensurate with Executive's then
position and title, as determined in the discretion of Company's Board
of Directors.
ARTICLE 3
TERM AND TERMINATION
3.1 Term. The initial term of employment of Executive under this Agreement
began on the 1st day of January, 2004 and will end on December 31,
2004. Such one-year period is the "Initial Term." The Initial Term,
together with any extensions, is referred to herein as the "Term."
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3.2 Renewal. This Agreement may be extended beyond the Initial Term or any
subsequent Term by mutual agreement of the parties, but will expire
upon the expiration of the Initial Term or any subsequent Term unless
extended by a writing signed by Company and Executive. Base Salary for
any additional one (1) year term of employment subsequent to the
Initial Term shall be negotiated between the parties in advance of the
beginning of each subsequent term. If the parties fail to negotiate a
mutually acceptable salary for any subsequent term by the beginning of
such term, the Executive shall be paid his then existing salary on a
provisional basis until agreement is reached. If such agreement is not
reached within ninety (90) days after the beginning of such term, then
the Base Salary for the subsequent calendar year shall be equal to the
Base Salary for the then current calendar year increased by a
percentage equal to the increase of the Consumer Price Index from the
first day of the then current calendar year to the first day of the
subsequent calendar year. For purposes of this Paragraph, "Consumer
Price Index" shall mean the Consumer Price Index For Wage Earners &
Clerical Workers, United States Average, All Items (1982-1984=100) or
any successor thereto and promulgated by the Bureau of Labor Statistics
of the United States Department of Labor. Once such new Base Salary has
been established, it shall be paid to the Executive retroactively from
the beginning of that one (1) year term.
3.3 Termination. This Agreement may be terminated in the following manner:
3.3.1 By Executive. Executive may terminate this Agreement for any
reason and at any time upon sixty (60) days written notice to
Company.
3.3.2 Death or Disability. This Agreement shall terminate upon
Executive's death or if executive suffers a disability that
renders Executive unable, as determined in good faith by
Company's Board of Directors, to perform the essential
functions of the position, even with reasonable accommodation,
for three months in any 12-month period (referred to in this
Agreement as "Total Permanent Disability").
3.3.3 Termination by Company for Cause. Company may terminate
Executive's employment and this Agreement "for cause"
immediately and without liability or further obligation
hereunder upon written notice to Executive. "Cause" as used
herein shall mean: (i) willful damaging of Company's property,
business, reputation or goodwill; (ii) commission of a felony;
(iii) theft, fraud or embezzlement; (iv) inattention to or
neglect of the duties to be performed by Executive that is not
the result of illness or accident and that is materially
harmful to Company; and (v) breach of any material term of
this Agreement, including, but not limited to, Article 4. No
act shall be willful if it is performed in good faith and with
the belief that it is in the Company's best interests.
3.3.4 Termination without Cause. Executive is employed hereunder at
the pleasure of Company's Board of Directors; Company may
terminate Executive's employment without Cause at any time
during the Term by giving Executive thirty (30) days prior
written notice.
3.4 Obligations of Company upon Termination. Company shall have the
following obligations upon any termination of this Agreement prior to
the end of the Term:
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3.4.1 Termination by Executive. If Executive terminates his
employment voluntarily Company shall promptly pay Executive
all Base Salary and unused vacation due to him as accrued
through the last day of employment.
3.4.2 Termination by Death or Total Permanent Disability. If
Executive's employment is terminated by reason of Executive's
death or Total Permanent Disability, Company shall pay: (a) to
Executive or Executive's estate, as applicable, all Base
Salary and unused vacation accrued through the date of his
death, or the date of the determination of his Total Permanent
Disability, (b) to Executive or Executive's estate, as
applicable, severance payments equal to Executive's monthly
Base Salary for a period of three (3) consecutive months from
the date of his death, or the date of the determination of his
Total Permanent Disability, in accordance with Company's
customary payroll practices, and (c) COBRA premiums to
maintain health coverage on Executive or Executive's medical
dependants, as applicable, for three (3) consecutive months
from date of his death, or the date of the determination of
his Total Permanent Disability,
3.4.3 Termination by Company for Cause. If Executive's employment is
terminated by Company for Cause, Company shall promptly pay
Executive all Base Salary and unused vacation due to him as
accrued through the last day of employment.
3.4.4 Termination by Company without Cause. If Company terminates
the employment of Executive without Cause, upon receipt of a
general release ("Release and Waiver") in favor of the
Company, in form reasonably acceptable to the Company and its
counsel, including customary provisions such as mutual
non-disparagement, the Company shall (a) pay to Executive
severance payments equal to Executive's monthly Base Salary
for a period of three (3) consecutive months, in accordance
with Company's customary payroll practices, and (b) pay COBRA
premiums to maintain health coverage on Executive for three
(3) consecutive months from the date of his termination of
employment.
3.4.5 Payment upon Termination. Whether the Executive's employment
with the Company is terminated due to the Executive
voluntarily terminating his employment or whether same is
effectuated due to a termination "for Cause" or without Cause,
all Base Salary (except as described in Section 3.4.4) and
unused vacation, if any, which may be due and owing from the
Company to the Executive pursuant to this Section 3.4 shall be
paid to the Executive within ten (10) business days of the
effective date of the termination of the Executive's
employment with the Company.
3.4.6 Payment upon Non-Renewal. Not less than ninety (90) days prior
to the expiration of the Initial Term or any subsequent Term,
the Company shall provide the Executive with written notice of
its decision as to whether or not the Company intends to renew
this Agreement. In the event that Company decides not to renew
this Agreement, Company shall (a) pay to Executive severance
payments equal to Executive's monthly Base Salary for a period
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of three (3) consecutive months, in accordance with Company's
customary payroll practices, and (b) pay COBRA premiums to
maintain health coverage on Executive for three (3)
consecutive months from the date of his termination of
employment. In the event that Executive decides not to renew
this Agreement, Company shall not be obligated to pay any
severance payments to Executive.
3.5 Full Satisfaction. The payments received by Executive (or his legal
representatives) under this Agreement that are attributable to the
termination of Executive's employment shall be in full and complete
satisfaction of any and all claims (except with respect to those claims
the Executive may have as to stock) Executive (or his legal
representatives) may have against the Company which are, in any way,
related to the employment relationship between Executive and Company
and Executive agrees to sign the Release and Waiver to this effect as a
condition of Company's obligation to make any payments hereunder. In
addition, Company will execute a Release and Waiver in favor of
Executive with respect to any claims known to Company (except those
which may arise out of criminal conduct) that Company may have against
Executive which are, in any way, related to the employment relationship
between Company and Executive.
ARTICLE 4
RESTRICTIVE COVENANTS
4.1 Confidential Information. During the period of his employment,
Executive shall hold in a fiduciary capacity for the benefit of Company
and its affiliates all trade secrets, proprietary or confidential
information, knowledge or data relating to Company, and/or their
respective businesses, which shall have been obtained by Executive.
Trade secret information includes formulas, patters, programs, customer
lists, devices, techniques, or processes that: (1) derive independent
economic value, actual or potential, from not being generally known to
the public or to persons who can obtain economic value from their
disclosure or use, and (2) are the subject of reasonable efforts under
the circumstances to maintain their secrecy. After termination of
Executive's employment with Company, Executive shall not, without the
prior written consent of Company, use, communicate or divulge any such
information, knowledge or data to anyone at any time.
4.2 Covenant Not to Compete. Executive agrees to not, during the course of
employment and for a period of one year commencing upon the termination
of employment, voluntarily or involuntarily, for any reason whatsoever
directly or indirectly, individually or on behalf of persons not now
parties to this Agreement, or as a partner, stockholder, director,
officer, principal, agent, executive, or in any other capacity or
relationship, (a) engage in any business or employment, or aid or
endeavor to assist any business or legal entity, that works in the fund
raising market for educational or charities in any geographical area in
which Company does business; (b) create, assist in the creation, or
manage or assist in the management a fund raising business focused on
the education or charity markets; or (c) compete on the internet with
the products and/or services of Company nationally or internationally.
Company and Executive acknowledge the reasonableness of this covenant
not to compete and the reasonableness of the geographic area and
duration of time which are a part of said covenant.
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4.3 Solicitation of Customers by Executive. Unless waived in writing by
Company, Executive further agrees that he will not, directly or
indirectly, during the course of employment and for one year thereafter
upon termination of this employment solicit the trade or patronage of
any of the customers of Company or of anyone who has heretofore traded
or dealt with Company, regardless of the location of such customers of
Company throughout the world with respect to any technologies,
services, products, trade secrets, or other matters in which Company is
active.
4.4 Solicitation of Employees by Executive. Unless waived in writing by
Company, Executive further agrees that he will not, directly or
indirectly, during the course of employment and for one year thereafter
induce any Company employee to leave the employ of Company if such
employee was employed by Company at any time during the one year prior
to termination of Executive's employment with Company. Further,
Executive agrees not to solicit or to employ, retain or engage any such
employee himself or on behalf of any other entity. In addition, it
shall be a violation of this paragraph for Executive to employ, retain
or engage any such Company employee as a consultant, agent, contract
employee, independent contractor, etc. with respect to Executive for
himself, or on behalf of any entity in which Executive has an ownership
interest or by which Executive is employed.
4.5 Survival; Injunctive Relief. Executive agrees that Article 4 of this
Agreement shall survive the termination of (1) this Agreement and (2)
the period of his employment hereunder. Executive acknowledges that
Company has no adequate remedy at law and would be irreparably harmed
if Executive breaches or threatens to breach any of the provisions of
Article 4 of this Agreement and, therefore, agrees that Company shall
be entitled to injunctive relief to prevent any such breach or
threatened breach thereof and to specific performance of the terms of
such Article (in addition to any other legal or equitable remedy
Company may have). Executive further agrees that Executive shall not,
in any equity proceeding relating to the enforcement of Article 4 of
this Agreement, raise the defense that Company has an adequate remedy
at law. Nothing in this Agreement shall be construed to prevent
Executive from raising any other defenses in such equity proceeding,
including that Company has failed to pay Executive any salary
continuation payment. Nothing in this Agreement shall be construed as
prohibiting Company from pursuing any other remedies at law or in
equity that it may have under and in respect of this Agreement or any
other agreement.
ARTICLE 5
MISCELLANEOUS
5.1 Notice. All notices and other communications hereunder shall be in
writing and shall be given to the other party by facsimile
transmission, hand delivery, nationally recognized overnight carrier or
by registered or certified mail, return receipt requested, postage
prepaid, addressed as follows:
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If to Executive: Xxxxxx Xxxxxxx
0000 Xxxxxxxxx Xxxxxxxx
Xxxxxx, XX 00000
If to Company: Xxxx Xxxxxxxx, CEO
Fundever, Inc.
0000 Xxxx Xxxxx Xxxxxxx Xxxx XX
Xxxxx 000
Xxxxxxx, XX 00000
or to such other address as any party shall have furnished to the other
in writing in accordance herewith. Any such notice and communications
shall be effective when actually received by the addressee.
5.2 Successors and Assigns. This Agreement is intended to bind and inure to
the benefit of and be enforceable by Executive and Company and their
respective successors and assigns, except that Executive may not assign
any of his rights or duties under this Agreement without Company's
prior written consent. Notwithstanding the preceding, in the event of a
merger between Company and XxxXxxxx.xxx, Inc., a Delaware corporation,
or one of its subsidiaries, the parties agree that Company's interest
in this Agreement may be assigned to XxxXxxxx.xxx, Inc., a Delaware
corporation.
5.3 Attorney Fees. If any legal proceeding is necessary to enforce or
interpret the terms of this Agreement, or to recover damages for breach
of this Agreement, the prevailing party shall be entitled to reasonable
attorney fees, as well as costs and disbursements, in addition to any
other relief to which the prevailing party may be entitled.
5.4 Counterparts. This Agreement may be executed on separate copies, any
one of which need not contain signatures of more than one party, but
all of which taken together will constitute one and the same agreement.
5.5 Amendment. This Agreement may not be amended or modified otherwise than
by a written agreement executed by the parties hereto or their
respective successors and legal representatives.
5.6 Severability. If any term, provision, or part of this Agreement is
found by a court to be invalid, illegal, or incapable of being enforced
by any rule of law or public policy, all other terms, provisions, and
parts of this Agreement shall nevertheless remain in full force and
effect as long as the economic or legal substance of the transactions
contemplated hereby is not affect in any manner materially adverse to
any party. On such determination that any term, provision, or part of
this Agreement is invalid, illegal, or incapable of being enforced,
this Agreement shall be deemed to be modified so as to effect the
parties' original intent as closely as possible to the end of the
transactions contemplated by this agreement and the terms and
provisions of this Agreement are fulfilled to the greatest extent
possible.
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5.7 Captions. The captions of this Agreement are not part of the provisions
hereof and shall not have any force or effect.
5.8 Choice of Law. All questions concerning the construction, validity, and
interpretation of this Agreement will be governed by the internal law,
and not the law of conflicts, of the State of Georgia. The proper venue
for any action or proceeding arising from or related to this Agreement
shall be Gwinnett County, Georgia.
5.10 Entire Agreement. This Agreement shall become effective upon execution
by Company and constitutes the full and entire understanding and
agreement of the parties with regard to the subjects hereof and
supersedes in their entirety all other or prior agreements, whether
oral or written, with respect to the subjects hereof.
IN WITNESS WHEREOF, the parties have duly executed this Employment Agreement as
of the day and year first above written.
Executive Schoolpop, Inc.
/s/ Xxxxxx Xxxxxxx
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Xxxxxx Xxxxxxx By: /s/ Xxxx Xxxxxxxx
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