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EX. 10.5
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is effective as of the
21st day of January, 2000 by and between XXXXXXXX.XXX LLC (the "Company")
having its principal office in St. Louis, Missouri, and XXXX X. XXXXXXXX, an
individual ("Employee").
WHEREAS, Employee desires to be employed by the Company, and
the Company desires to employ Employee, upon the terms and conditions
hereinafter set forth.
NOW, THEREFORE, in consideration of the compensation and other
benefits of Employee's employment by the Company and the recitals, mutual
covenants and agreements hereinafter set forth, Employee and the Company agree
as follows:
1. Employment Services.
(a) Employee is hereby employed by the Company,
and Employee hereby accepts such employment, upon the terms and conditions
hereinafter set forth. During the Employment Period (as defined below), Employee
shall serve as requested and in the discretion of the CEO.
2. Term of Employment. The term of this Employment
Agreement (the "Employment Period") shall commence on January 21, 2000
(the "Effective Date"), shall end on January 21, 2001 (the "Initial Period"),
and shall thereafter continue from year to year (each an "Annual Extension"),
unless sooner terminated as provided in the second sentence of this Section 2 or
in Section 4 hereof. Unless sooner terminated as provided in Section 4 hereof,
the Employment Period may be terminated by either the Company or Employee, at
the end of the Initial Period or an Annual Extension, if a written notice of
nonrenewal is delivered to the other party at least six (6) months prior to the
end of such Initial Period or Annual Extension, as the case may be.
3. Compensation and Benefits.
(a) Annual Base Salary. During the Employment
Period, the Company shall pay Employee as compensation for his services an
initial annual base salary of $140,000 per year. Employee's annual base
salary rate shall be reviewed at least annually for increase (but in no event
decrease) in the discretion of the CEO. The annual base salary shall be paid to
Employee on the regular pay periods established by the Company.
(b) Bonus. In addition to Employee's base
compensation, Employee shall be eligible to earn a bonus upon achievement of
such objectives as may be established from time to time by the CEO. It is the
expectation that the Employee will be eligible to earn a bonus equal to his base
salary upon achievement of such objectives, with greater bonus payments
available if such objectives are exceeded.
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(c) Additional Equity Participation. In
addition, Employee shall be entitled to participate in such equity incentive
plan as may be approved from time to time by the Board of Managers.
(d) Benefits. For so long as he is employed by
the Company, the Company will pay for Employee's personal vehicle, which
Employee can replace every three (3) years. The payments on the current vehicle
are $537.00 per month. Employee shall also receive all other standard employee
benefits made available to senior executives of the company. Employee shall be
eligible for all of the Company's benefits, including participation in any
pension or option plan(s), so long as Employee qualifies under the terms of the
plan documents. Subsequent to termination of Employee's employment, Employee
shall have the option to continue in the Company's benefit plans at his sole
cost so long as Employee qualifies under the terms of the plan documents.
(e) Expenses. The Company agrees to reimburse
Employee for those reasonable expenses incurred by Employee as a result of
Employee promoting the business of the Company, including expenses for
entertainment, travel and similar items upon the presentation by Employee of any
itemized account of such expenses in such detail as to meet IRS requirements for
the deduction of such expenses and said expenses must be ordinary and necessary
expenses of the Company paid or incurred in carrying on the Company's trade or
business.
4. Termination of Employment. Prior to the expiration
of the Employment Period, this Agreement and Employee's employment may be
terminated as follows:
(a) By the Company, if Employee engages in
conduct which gives the Company cause to discharge him. "Cause" shall be defined
as fraud, misrepresentation, theft, embezzlement, or intentional violation of
law or the Company's policies or willful refusal to follow lawful directives of
the CEO or the Board of Managers, which violation or willful refusal is not
remedied within ten (10) days after receipt of notice thereof from the Company.
(b) Automatically, upon Employee's death or
legal incapacity.
(c) By the Company, upon the Employee's
incapacity or inability to perform the services contemplated by this Agreement
for a period of at least one hundred-eighty (180) days in any three
hundred-sixty (360) day period because his physical or mental health shall have
become so impaired as to make it impossible or impractical to perform the duties
and responsibilities contemplated hereunder.
(d) By the Company, at the discretion of the
CEO or upon a majority vote of the Board of Managers.
5. Effect of Termination of Employment. Upon termination
of Employee's employment and this Agreement, the rights and obligations of the
parties pursuant to Sections 7 through 14 and Sections 16 and 17 shall be
unaffected, but all other rights and obligations of the parties hereunder shall
cease, except:
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(a) If the Agreement is terminated pursuant to
Section 4(a), all of the Employee's rights to receive compensation and benefits
under this Agreement shall terminate as of the date of such termination, except
as otherwise mandated by law, and the Employee shall not be entitled to any
bonus with respect to the year in which termination occurs.
(b) If this agreement is terminated pursuant to
Section 4(d), the Company shall continue to pay Employee (or his estate), his
Annual Base Salary at the time of termination described in Section 3(a) of this
Agreement for one (1) year, a pro rata bonus under Section 3(b) for the period
through the date of termination, and a bonus under Section 3(b) for the twelve
month period following the termination (collectively, "Severance Pay"). The
Severance Pay shall be paid to Employee (or his estate) on the regular pay
periods established by the Company, but at least on a monthly basis, and shall
be subject to withholding and other applicable taxes. Notwithstanding the terms
of any option plan or any equity awards granted to Employee thereunder, all such
options and equity awards outstanding immediately prior to such termination
shall immediately become exercisable. If Employee has been found to have in any
manner breached Section 7 of this Agreement, then the Company's duty to pay any
Severance Pay to Employee under this Section 5(b) of this Agreement shall
terminate from the date on which it is determined that said breach occurred and
Employee shall immediately reimburse the Company for any Severance Pay payments
made by the Company to Employee after the first date on which said breach
occurred.
(c) If this Agreement is terminated pursuant to
Section 4(b) or 4(c), Employee (or his estate) shall receive his annual base
salary for the remainder of the calendar year in which such termination occurs
(according to the same payroll practices in effect at the time of termination)
and benefits (as applicable) for the remainder of the year and six months of the
following year. Notwithstanding the terms of any option plan or any equity
awards granted to Employee thereunder, all such options and equity awards
outstanding immediately prior to such termination shall immediately become
exercisable.
6. Withholding. All compensation paid to Employee shall
be subject to customary withholding taxes and other employment taxes as required
with respect thereto.
7. Non-Competition and Non-Solicitation Agreement.
Employee agrees that during his employment by the Company and for the period
beginning on the date hereof and ending twelve (12) months following expiration
or termination of employment for any reason, Employee will not, as an individual
or as a partner, employee, agent, advisor, consultant or in any other capacity
of, or, directly or indirectly, (i) carry on any business, or own greater than a
10% interest in any, Internet intensive business that uses the Global Portal
Platform or a company that derives over 50% of its gross revenues or over one
hundred million dollars ($100,000,000.00) from the sale of telecommunications
infrastructure equipment over or through the use of the internet or the world
wide web, anywhere in the United States (the "Territory"), or (ii) solicit or
hire, or engage as a consultant or in any other capacity, any person who was an
employee or officer of the Company at the time of termination of the Employee's
employment, or at any time within six (6) months prior to such termination.
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Employee recognizes the broad territorial scope of the
covenant above, but acknowledges and agrees that the restriction is reasonable
and enforceable in view of, among other things, (1) the narrow range of
activities prohibited, (2) the national market in which the Company and its
affiliates operate, and (3) Employee's background, which is such that the
restraint will not impose an undue hardship on Employee.
Employee expressly agrees that the covenant set forth in this
Section 7 is reasonable in light of the scope of the business heretofore
conducted by the Company. If any court or tribunal of competent jurisdiction
shall refuse to enforce the foregoing covenant because the time limit applicable
thereto is deemed unreasonable, it is expressly understood and agreed that such
covenant shall not be void, but that for the purpose of such proceedings and in
such jurisdiction, such time limitation shall be deemed reduced to the extent
necessary to permit enforcement of the covenant. If any court or tribunal of
competent jurisdiction shall refuse to enforce the foregoing covenant because it
is more extensive (whether as to geographic area, scope of business or
otherwise) than is deemed reasonable, it is expressly understood and agreed
between the parties hereto that such covenant shall not be void, but that for
the purpose of such proceedings and in such jurisdiction, the restrictions
contained herein (whether as to geographic area, scope of business or otherwise)
shall be deemed reduced to the extent necessary to permit enforcement of the
covenant.
Employee further acknowledges and agrees that the damages
resulting from any breach of the foregoing covenant may be intangible in whole
or in part and that the Company is entitled to seek specific enforcement,
injunctive relief and other equitable remedies in addition to monetary damages,
and Employee hereby stipulates to the entering of such injunctive relief
prohibiting Employee from competing with the Company in breach of such covenant.
8. Non-Waiver of Rights. The failure of either party to
enforce at any time any of the provisions of this Agreement or to require at any
time performance by the other party of any of the provisions hereof shall in no
way be construed to be a waiver of such provisions or to affect either the
validity of this Agreement, or any part hereof, or the right of either party
thereafter to enforce each and every provision in accordance with the terms of
this Agreement.
9. Severability and Interpretation. Whenever possible,
each provision of this Agreement and any portion hereof shall be interpreted in
such a manner as to be effective and valid under applicable law, rules and
regulations. If any covenant or other provision of this Agreement (or portion
thereof) shall be held to be invalid, illegal, or incapable of being enforced,
by reason of any rule of law, rule, regulation, administrative order, judicial
decision or public policy, all other conditions and provisions of this Agreement
shall, nevertheless, remain in full force and effect, and no covenant or
provision shall be deemed dependent upon any other covenant or provision (or
portion) unless so expressed herein. The parties hereto desire and consent that
the court or other body making such determination shall, to the extent necessary
to avoid any unenforceability, so reform such covenant or other provision or
portions of this Agreement to the minimum extent necessary so as to render the
same enforceable in accordance with the intent herein expressed.
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10. Entire Agreement. This Agreement represents the
entire and integrated Employment Agreement between Employee and the Company and
supersedes all prior negotiations, representations and agreements, either
written or oral, with respect thereto.
11. Notice. All notices and other communications
hereunder shall be in writing and shall be given by hand delivery to the other
party, by registered or certified mail, return receipt requested, postage
prepaid, or by overnight courier, addressed to such address as may have been
furnished to the other party in writing. Notices and communications shall be
effective at the time they are given in the foregoing manner (provided that
notice by mail shall be deemed given three business days after posting).
12. Amendments and Waivers. No modification, amendment
or waiver of any of the provisions of this Agreement shall be effective unless
in writing specifically referring hereto, and signed by the parties hereto.
13. Assignments. This Agreement shall be binding upon,
and shall inure to the benefit of the Parties heirs, administrators, executors,
successors and assigns.
14. Arbitration. Except for disputes for which equitable
relief is permitted under this Agreement, any controversy or claim arising out
of or relating to this Agreement, the employment relationship or any breach
thereof between the Company and Employee and any of their agents, employees and
affiliated companies shall be settled by arbitration in accordance with the
rules of the America Arbitration Association and judgment upon the award may be
entered in any court having jurisdiction.
15. Headings. Section headings are provided in this
Agreement for convenience only and shall not be deemed to substantively alter
the content of such sections.
16. Indemnification. To the fullest extent permitted by
the indemnification provisions of the operating agreement of the Company in
effect as of the date of this Agreement (collectively, the "Indemnification
Provision"), and in each case subject to the conditions thereof, the Company
shall (i) indemnify the Employee, as an officer or director of the Company if
the Employee shall be serving in such capacity at the Company's written request,
against all liabilities and reasonable expenses that may be incurred by the
Employee in any threatened, pending, or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative, and whether formal or
informal, because the Employee is or was an officer or director of the Company
and (ii) pay for or reimburse the reasonable expenses incurred by the Employee
in the defense of any proceeding to which the Employee is a party because the
Employee is or was an officer or director of the Company. The rights of the
Employee under the Indemnification Provision shall survive the termination of
the employment of the Employee by the Company.
17. Non-Disclosure Agreement. Employee shall execute
the non-disclosure agreement attached as Exhibit A.
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THIS CONTRACT CONTAINS A BINDING ARBITRATION PROVISION WHICH
MAY BE ENFORCED BY THE PARTIES.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the day and year first above written.
/s/ Xxxx X. Xxxxxxxx
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Xxxx X. Xxxxxxxx
XXXXXXXX.XXX LLC
By: /s/ Xxxxx X. Xxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxx
Title: Chief Executive Officer
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