CONSULTING AGREEMENT
Exhibit
10.33
This
CONSULTING
AGREEMENT
(the
“Agreement”),
dated
as of December 18th, 2007 (the “Effective
Date”),
is
between GoFish Corporation, a Nevada corporation (the “Company”)
and
Xxxxx Xxxxxxxx (“Consultant”).
| I. |
RELATIONSHIP
OF THE PARTIES
|
A. Consultant
enters into this agreement as, and shall continue to be, an independent
contractor. In no circumstance shall Consultant look to Company as Consultant’s
employer, partner, agent, or principal. Neither Consultant nor any employee
of
Consultant (which for purposes of this Paragraph shall be included in the term
“Consultant”) shall be entitled to any benefits accorded to Company’s employees,
including workers’ compensation, disability insurance, retirement plans, or
vacation or sick pay. Consultant’s exclusion from benefit programs maintained by
Company is a material component of the terms of compensation negotiated by
the
Parties, and is not premised on Consultant’s status as a non-employee with
respect to Company. To the extent that Consultant may become eligible for any
benefit programs maintained by Company (regardless of the timing of or reason
for eligibility), Consultant hereby waives Consultant’s right to participate in
the programs. Consultant’s waiver is not conditioned on any representation or
assumption concerning Consultant’s status under the common law test. Consultant
also agrees that, consistent with Consultant’s independent contractor status,
Consultant will not apply for any government-sponsored benefits that are
intended to apply to employees, including, but not limited to, unemployment
benefits.
B. Consultant
shall pay, when and as due, any and all taxes incurred as a result of
Consultant’s compensation hereunder, including estimated taxes and payroll
taxes. Consultant indemnifies Company for any claims, losses, costs, fees,
liabilities, damages, or injuries suffered by Company arising from Consultant’s
breach of the provisions of this Paragraph I.
C. Consultant
and Company shall provide to each other upon request any information reasonably
necessary to determine their obligations under this Agreement, to fulfill the
purposes of the Services, or to maintain accurate records.
| II. |
POSITION
AND RESPONSIBILITIES
|
A. Term.
The
Company shall engage Consultant’s services for a term of two (2) years from the
Effective Date unless Consultant’s services are terminated in accordance with
Sections IV, V or VI below (the “Term”).
B. Position.
Upon
the
Effective Date, Consultant shall render services to the Company in the position
Executive Chairman of the Company. Consultant shall perform such duties and
responsibilities as are normally related to such position in accordance with
the
standards of the industry and any additional duties now or hereafter reasonably
assigned to Consultant by the Company’s Board of Directors (the “Board
of Directors”)
consistent with this position and the terms and conditions of this Agreement.
Consultant shall report to the Board of Directors. Consultant shall abide by
the
rules, regulations, and practices as adopted or modified from time to time
by
the Board of Directors that apply generally to directors and independent
contractors of the Company. Consultant shall also serve as a director on behalf
of any of the Company’s affiliated entities as reasonably requested by the
Company and accepted by Consultant without any additional compensation.
Consultant also will serve as a member of the Board of Directors. On a quarterly
basis, Consultant shall devote an average of 20 hours a week to his work for
the
Company. Consultant shall be located in Los Angeles and shall be expected to
travel if reasonably necessary and to be available for special calls and
teleconference meetings to meet the obligations of his position. Travel time
shall count towards Consultant’s 20 hour-per-week commitment to Company.
1
C. Other
Activities.
By
executing this Agreement, Consultant agrees to serve in such position and to
devote his time (as defined in Section B, above), attention, loyalty and
efforts to the performance of Consultant’s duties. Consultant may, during the
term of this Agreement, serve as an advisor, consultant, employee to, or be
on
the Board of Directors of, other companies as long as those companies
are not primarily in the Business of the Company, which shall be defined as
aggregating websites and selling advertising targeting youth under the age
of
18.
D. No
Conflict.
Consultant represents and warrants that his execution of this Agreement, his
engagement with the Company, and the performance of his proposed duties under
this Agreement shall not violate any obligations he may have to any other
employer, person or entity, including any obligations with respect to
proprietary or confidential information of any other person or
entity.
| III. |
COMPENSATION
|
A. Compensation.
In
consideration of the services to be rendered under this Agreement, the Company
shall pay Consultant at the monthly rate of FIFTEEN THOUSAND DOLLARS ($15,000)
for the first six months of the Term. During these first six (6) months of
the
Term, Consultant shall also accrue additional compensation at the monthly rate
of FIVE THOUSAND DOLLARS ($5,000), which shall be paid to him at the earlier
of
the closing of a Change of Control of the Company or on the six month
anniversary of the Effective Date of this Agreement (the “Six Month
Anniversary”), provided, however, that if Consultant’s engagement is terminated
for any reason prior to the Six Month Anniversary, Consultant (or his heirs,
as
applicable) shall receive a lump sum payment equal to $30,000 multiplied by
a
fraction the numerator of which is the number of calendar days that have elapsed
from the Effective Date and the denominator of which shall be 180 days. At
the
end of the six-month period, the Company shall pay Consultant at the monthly
rate of TWENTY THOUSAND DOLLARS ($20,000). Consultant’s compensation will be
reviewed annually and may be adjusted upwards (but not down)in the sole
discretion of the Company.
B. Performance
Bonus.
The
Company shall recommend to the Board of Directors that Consultant be eligible
to
receive incentive compensation of ONE HUNDRED THOUSAND DOLLARS ($100,000) per
year, contingent upon attainment of performance targets to be mutually agreed
upon by Consultant and the Board of Directors, as part of the Company’s annual
operating plan. However, the performance bonus under this provision shall be
deemed payable in cash only on the occurrence of the earlier of the Company’s
possession of cash and cash equivalents calculated on a U.S. GAAP basis equal
to
or greater than $4,000,000, or a Change of Control as defined in
Section IV, C., below; PROVIDED, HOWEVER, that should neither event occur
before the end of the year for which such bonus is earned, Consultant shall
be
entitled to any earned bonus in the form of fully-vested restricted stock,
valued on the date of the end of such year. Company agrees to make a reasonable
effort to ensure that the restricted stock is registered with the SEC. If
Consultant’s engagement is terminated prior to December 31 of the applicable
bonus year for any reason other than Section V., A., below, and the
performance targets mutually agreed upon are met for that bonus year, Consultant
shall be entitled to a pro rata portion of the bonus consistent with the length
of time he was engaged during that bonus year. Payments of incentive
compensation under this Section III, B., shall be made no later than January
31
of the calendar year next following the calendar year to which the incentive
compensation relates (subject to the next succeeding sentence). Company agrees
that such restricted shares shall not be granted during any period in which
Consultant is prohibited from trading under any Company policy or applicable
law; provided however that in any event any earned award shall be issued not
later than two and one-half months after the end of the applicable fiscal year.
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C. Stock
Options.
The
Company shall recommend to the Board of Directors that Consultant be provided
with non-qualified stock options to purchase a total of ONE
MILLION FIVE HUNDRED THOUSAND (1,500,000)
shares
of Common Stock of the Company (each such option, an “Option” and, collectively,
the “Options”). Ten percent (10%) of the total amount of Options shall vest on
the Effective Date and 1/24th
of the
remainder of Options shall vest monthly thereafter, provided that Consultant
continues to provide services to the Company. This recommendation will be
considered for approval as soon as practicable but in no event later than at
the
Company’s next Board of Directors’ meeting after the Effective Date. Any
approved stock options will be priced at the closing price of the Common Stock
of the Company as of the date of the grant, in accordance with the terms of
the
applicable stock incentive plan. Consultant’s entitlement to any stock options
that may be approved by the Board of Directors shall be conditioned upon
Consultant’s signing of, and shall be subject to and in accordance with the
terms of, an applicable stock option agreement or other similar Company plan
document.
D. Incentive
Compensation. The
Company shall recommend to the Board of Directors that Consultant shall be
eligible to participate in an incentive compensation plan to be established
by
the Board of Directors, under which Consultant shall be eligible to receive
up
to ONE HUNDRED FIFTY THOUSAND (150,000) fully vested shares of restricted stock
per year, contingent upon attainment of performance targets to be mutually
agreed upon by Consultant and the Board of Directors, as part of the Company’s
annual operating plan. If Consultant’s engagement is terminated prior to
December 31 of the applicable bonus year for any reason other than
Section V., A., below, and the performance targets mutually agreed upon are
met for that bonus year, Consultant shall be entitled to a pro rata portion
of
the bonus consistent with the length of time he was engaged during that bonus
year. Consultant’s entitlement to any restricted stock that may be approved by
the Board of Directors shall be conditioned upon Consultant’s signing of, and
shall be subject to and in accordance with the terms of, an applicable
restricted stock agreement or other similar Company plan document. Company
agrees to make a reasonable effort to ensure that the restricted stock is
registered with the SEC. Company agrees that such restricted shares shall not
be
granted during any period in which Consultant is prohibited from trading under
any Company policy or applicable law; provided however that in any event any
earned award shall be issued not later than two and one-half months after the
end of the applicable fiscal year.
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E. Expenses.
Consultant shall be reimbursed for all reasonable business-related travel and
other expenses incurred by Consultant. Consultant shall be entitled to incur
expenses for accommodations and travel at the same standard as the Chief
Executive Officer of Company. Company shall provide Consultant with a Company
credit card. When traveling, Consultant shall be provided with private hotel
accommodations and will not be required to share a room with other
executives.
F. Indemnity
Agreement and Charter.
The
Company and Consultant shall enter into an Indemnity Agreement with the Company
in substantially the form attached hereto as Exhibit A (the “Indemnity
Agreement”).
The
Company shall also promptly submit the form of the Indemnity Agreement, along
with the revised charter (the “Revised Charter”) attached hereto as Exhibit B,
to its shareholders for approval, along with a written recommendation from
the
Board of Directors to the shareholders to approve the form of Indemnity
Agreement and Revised Charter.
G. Lock-Up
Agreement.
During
any 30 calendar day period during the Term of this Agreement, Consultant
shall not sell any shares of the Company’s stock that would exceed five
percent (5%) of the aggregate volume of the Company’s stock that was sold in the
preceding 25 trading days. Upon termination of the Agreement, Consultant
shall not sell any shares of the Company’s stock during any 30 calendar day
period that would exceed fifteen percent (15%) of the aggregate volume of the
Company’s stock that was sold in the preceding 25 trading days.
H. Stock
Ownership Guidelines.
During
the Term, Consultant will comply with the corporate officer stock ownership
guidelines approved by the Board of Directors, as may be amended from time
to
time; provided that such guidelines as they relate to Consultant shall not
be more restrictive on Consultant than, or otherwise conflict with, the
provisions of this Agreement.
I. The
Company shall reimburse Consultant up to FIFTEEN THOUSAND DOLLARS ($15,000)
for
legal fees incurred in the negotiation of this Agreement.
| IV. |
AT-WILL
EMPLOYMENT; TERMINATION BY
COMPANY
|
A. At-Will
Termination by Company.
Consultant’s engagement with the Company shall be “at-will” at all times. The
Company or Consultant may terminate Consultant’s engagement with the Company at
any time, without any advance notice, for any reason or no reason at all. Upon
and after such termination, all obligations of the Company and Consultant under
this Agreement shall cease, except as otherwise provided herein. Upon a
termination for any reason under this Agreement, the Company shall promptly
pay
to Consultant all compensation to which Consultant is entitled to receive up
through the date of termination, as well as reimbursement of expenses incurred
through the date of termination in accordance with Section III.E (“Accrued
Obligations”).
4
X. Xxxxxxxxx.
Except
in situations where the engagement of Consultant is terminated For Cause, By
Death or By Disability (as defined in Section V below), in the event that the
Company terminates the engagement of Consultant at any time, (1) Consultant
will
receive severance payable in the form of a lump sum payment of ONE HUNDRED
TWENTY THOUSAND DOLLARS ($120,000) (the “Severance”),and
(2) Consultant will receive an additional six (6) months of vesting
(calculated as of the effective date of his Termination) on all Options,
restricted stock or RSUs awarded to Consultant as of the time of such
termination. Consultant’s eligibility for Severance is conditioned on Consultant
having first signed a mutual release and covenant not to xxx agreement in a
form
mutually satisfactory to the parties (for which consent shall not be
unreasonably withheld) (the “Mutual Release Agreement”). The Severance shall be
paid to Consultant within seven (7) days after Consultant executes and delivers
to the Company the Mutual Release Agreement. Consultant shall not be entitled
to
any Severance payments if Consultant’s engagement is terminated For Cause, By
Death or By Disability (as defined in Section V below). Except as set forth
in this Section IV(B), upon such termination of engagement, all unvested
Options, restricted stock and the unvested RSUs awarded to Consultant shall
immediately expire effective as of the date of such termination and (ii) the
vested Options awarded to Consultant, to the extent unexercised, shall expire
two (2) years after such termination and Consultant shall have such two (2)
year
period to exercise his Options.
C. “Change
of Control.” In
the
event of a Change of Control, any Options, restricted stock and RSUs awarded
to
Consultant that vest solely upon length of service will become immediately
vested. For purposes of this Agreement, “Change of Control” shall mean any of
the following: (i) a change in ownership or control of the Company effected
through a merger, consolidation, sale or acquisition by or to any person or
related group of persons (other than an acquisition by the Company or by a
Company-sponsored employee benefit plan ) of beneficial ownership (within the
meaning of Rule 13d-3 of the Securities Exchange Act of 1934) of securities
possessing more than fifty percent of the total combined voting power of the
outstanding securities of the Company; or (ii) the sale, transfer or other
disposition of all or substantially all of the Company’s assets. Notwithstanding
the foregoing, a “Change in Control” shall not include any changes on or prior
to the date of this Agreement. Consultant shall not be entitled to any
accelerated vesting under this Section IV(C) if Consultant’s engagement is
terminated prior to a Change in Control (a) For Cause, By Death or By Disability
(as defined in Section V below); (b) by Consultant without Good Reason (as
defined in Section V below); or (c) by expiration or non-renewal of the
Term.
5
|
V.
|
OTHER
TERMINATIONS BY COMPANY
|
A. Termination
for Cause.
For
purposes of this Agreement, “For Cause” shall mean: (i) Consultant’s
conviction of a felony or a misdemeanor involving dishonesty, breach of trust,
or intentional physical harm to any person; (ii) Consultant willfully
engages in conduct that is in bad faith and materially injurious to the Company,
including but not limited to, misappropriation of trade secrets, fraud or
embezzlement; (iii) Consultant commits a material breach of this Agreement;
or (iv) Consultant willfully refuses to implement or follow a lawful policy
or directive of the Company, or demonstrates a pattern of failure to perform
job
duties diligently and professionally in accordance with the terms of this
Agreement,. The Company may terminate Consultant’s engagement For Cause at any
time, without any advance notice, except that the Company shall not be entitled
to terminate Consultant’s Engagement for Cause with respect to Sections V.A
(iii) or (iv) , unless the Company provides written notice to Consultant of
the
alleged facts underlying the breach of Sections V.A.(iii) or (iv) , within
thirty (30) days of the date that the Company learns of such alleged breach,
which Consultant fails to cure within twenty days after receiving such written
notice. The Company shall pay to Consultant all Accrued Obligations earned
or
incurred through the date of termination, subject to any other rights or
remedies of Consultant or the Company under law; and thereafter all obligations
of the Company under this Agreement shall cease. Upon such termination of
engagement For Cause, (i) the unvested Options, restricted stock and RSUs
awarded to Consultant shall immediately expire effective as of the date of
such
termination, (ii) the vested Options awarded to Consultant, to the extent
unexercised, shall expire ninety (90) days after such termination and Consultant
shall have such 90 days to exercise such Options, and (iii) Consultant may
sell
vested Options and stock (including stock underlying RSUs) subject to the
restrictions imposed in III, G., above.
B. By
Death.
Consultant’s engagement shall terminate automatically upon Consultant’s death.
The Company shall pay to Consultant’s beneficiaries or estate, as appropriate,
all Accrued Obligations earned or incurred through the date of termination.
Thereafter, all obligations of the Company under this Agreement shall cease.
Upon such termination of engagement, (i) the unvested Options, restricted stock
and RSUs awarded to Consultant shall immediately expire effective as of the
date
of such termination , (ii) the vested Options awarded to Consultant, to the
extent unexercised, shall expire two (2) years after such termination and
Consultant’s heirs shall have such two (2) year period to exercise such Options;
Consultant’s heirs may sell vested Options and stock
(including stock underlying RSUs) subject to the restrictions imposed in
III., G.
C. By
Disability.
If, in
the sole reasonable opinion of the Company, Consultant is unable to carry out
the responsibilities and functions of the position held by Consultant by reason
of any physical or mental impairment. taking into account any reasonable
accommodations, for more than ninety consecutive days or more than one hundred
and twenty days in any twelve-month period, then, to the extent permitted by
law, the Company may terminate Consultant’s engagement. The Company shall pay to
Consultant all Accrued Obligations through the date of termination, and
thereafter all obligations of the Company under this Agreement shall cease.
Upon
such termination of engagement, (i) the unvested Options, restricted stock
and
RSUs awarded to Consultant shall immediately expire effective as of the date
of
such termination, (ii) the vested Options awarded to Consultant, to the extent
unexercised, shall expire two (2) years after such termination and Consultant
shall have such two (2) year period to exercise such Options, and (iii)
Consultant may sell vested Options and stock (including stock underlying RSUs)
subject to the restrictions imposed in III, G.
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VI.
|
TERMINATION
BY CONSULTANT
|
A. At-Will
Termination by Consultant.
Consultant may terminate engagement with the Company at any time for any reason
or no reason at all, upon no less than four (4) weeks’ advance written notice.
During such notice period Consultant shall continue to diligently perform all
of
Consultant’s duties hereunder. The Company shall have the option, in its sole
discretion, to make Consultant’s termination effective at any time prior to the
end of such notice period as long as the Company pays Consultant all
compensation to which Consultant is entitled, and allows Consultant’s Options,
restricted stock and RSUs to continue vesting, up through the last day of the
four week notice period. Thereafter all obligations of the Company shall cease.
Upon such termination of engagement, (i) the unvested Options, restricted stock
and the unvested RSUs awarded to Consultant shall immediately expire effective
as of the end of such notice period and (ii) the vested Options awarded to
Consultant, to the extent unexercised, shall expire ninety (90) days after
the
end of such notice period and Consultant shall have such 90 day period to
exercise such Options.
B. Termination
for Good Reason.
Consultant’s termination shall be for “Good Reason” if Consultant provides
written notice to the Company of the Good Reason within sixty (60) days of
the
date that Consultant learns of the event constituting Good Reason and provides
the Company with a period of twenty (20) days to cure the event constituting
Good Reason and the Company fails to cure the Good Reason within that period.
For purposes of this Agreement, “Good Reason” shall mean any of the following
events if the event is effected by the Company without the written consent
of
Consultant: (A) a change in Consultant’s position with Company which materially
reduces Consultant's level of responsibility; (B) a reduction in Consultant’s
compensation; (C) a material breach of this Agreement by the Company; or (D)
the
Company giving Consultant a directive or order that Consultant refuses to follow
because, in the reasonable opinion of Consultant’s counsel, it is a violation of
any applicable state, federal or local law, regulation, ordinance, or
constitution. In such event Consultant may terminate his engagement for Good
Reason, in which case (1) Consultant will receive a lump sum payment of the
Severance and (2) all Options and restricted stock and RSUs awarded to
Consultant will vest by an additional 6 months calculated as of the effective
date of Consultant’s termination; and (3) the Company shall pay to Consultant
all Accrued Obligations earned or incurred through the date of termination.
Consultant’s eligibility for Severance is conditioned on Consultant having first
signed the Mutual Release Agreement. The Severance shall be paid to Consultant
within seven (7) days after Consultant executes and delivers to the Company
the
Mutual Release Agreement. Thereafter all obligations of the Company or its
successor and the Consultant under this Agreement shall cease. Except as set
forth in this Section VI(B), upon such termination of this engagement, all
unvested Options and the unvested restricted stock and RSUs awarded to
Consultant shall immediately expire effective as of the date of such
termination, (ii) the vested Options awarded to Consultant, to the extent
unexercised, shall expire two (2) years after such termination and Consultant
shall have such 2 year period to exercise such Options and (iii) Consultant
may sell vested Options and
stock
(including stock underlying RSUs) subject to the restrictions imposed in III,
G.
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VII.
|
TERMINATION
OBLIGATIONS
|
A. Return
of Property.
Consultant agrees that all property (including without limitation all equipment,
tangible proprietary information, documents, records, notes, contracts and
computer-generated materials) furnished to or created or prepared by Consultant
incident to Consultant’s engagement belongs to the Company and shall be promptly
returned to the Company upon termination of Consultant’s engagement’ provided,
however, that Consultant shall be entitled to maintain possession of documents
and correspondence that Consultant received or maintained as a member of the
Board of Directors for record keeping purposes only.
B. Resignation
and Cooperation.
Upon
termination of Consultant’s engagement, Consultant shall be deemed to have
resigned from all offices and directorships then held with the Company or its
affiliates. Following any termination of engagement, Consultant shall cooperate
with the Company in the winding up of pending work on behalf of the Company
and
the orderly transfer of work to other employees or consultants. Consultant
shall
also cooperate with the Company in the defense of any action brought by any
third party against the Company, or the prosecution of any action brought by
the
Company against a third party, that relates to Consultant’s engagement. The
Company shall promptly reimburse Consultant or directly pay for (i) all legal,
travel and out-of-pocket costs incurred by Consultant in connection with any
such legal action; and (ii) Consultant’s time incurred in assisting the Company
in the defense or prosecution of any such legal action at an hourly rate of
pay
consistent with his payment under this Agreement .
C. Continuing
Obligations.
Consultant understands and agrees that Consultant’s obligations under Sections
VII, VIII, IX and X herein shall survive the termination of Consultant’s
engagement for any reason and the termination of this Agreement.
| VIII. |
INVENTIONS
AND CONFIDENTIAL INFORMATION; PROHIBITION ON THIRD PARTY
INFORMATION
|
A. Confidential
Information.
1. Consultant
expressly acknowledges that, in the performance of his duties and
responsibilities with the Company, he has been exposed since prior to the
Effective Date, and will be exposed, to the trade secrets, business and/or
financial secrets and confidential and proprietary information of the Company,
its affiliates and/or its clients, business partners or customers (“Confidential
Information”). The term “Confidential Information” includes information or
material that has actual or potential commercial value to the Company, its
affiliates and/or its clients, business partners or customers and is not
generally known to and is not readily ascertainable by proper means to
persons outside the Company, its affiliates and/or its clients or customers
providing that the information is not required to be divulged as a result of
a
subpoena or other such legal requirements and rules.
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2. Except
as
authorized in writing by the Board, during the performance of Consultant’s
duties and responsibilities for the Company and until such time as any such
Confidential Information becomes generally known to and readily ascertainable
by
proper means to persons outside the Company, its affiliates and/or its clients,
business partners or customers, Consultant agrees to keep strictly confidential
and not use for his personal benefit or the benefit to any other person or
entity (other than the Company) the Confidential Information. “Confidential
Information” includes the following, whether or not expressed in a document or
medium, regardless of the form in which it is communicated, and whether or
not
marked “trade secret” or “confidential” or any similar legend: (i) lists of
and/or information concerning (including identities of) customers, prospective
customers, suppliers, employees, consultants, co-venturers and/or joint venture
candidates of the Company, its affiliates or its clients or customers;
(ii) information submitted by customers, prospective customers, suppliers,
employees, consultants and/or co-venturers of the Company, its affiliates and/or
its clients or customers; (iii) non-public information proprietary to the
Company, its affiliates and/or its clients or customers, including, without
limitation, cost information, profits, sales information, prices, accounting,
unpublished financial information, business plans or proposals, expansion plans
(for current and proposed facilities), markets and marketing methods,
advertising and marketing strategies, administrative procedures and manuals,
the
terms and conditions of the Company’s contracts and trademarks and patents under
consideration, distribution channels, franchises, investors, sponsors and
advertisers; (iv) proprietary technical information concerning products and
services of the Company, its affiliates and/or its clients, business partners
or
customers, including, without limitation, product data and specifications,
diagrams, flow charts, know how, processes, designs, formulae, inventions and
product development; (v) lists of and/or information concerning applicants,
candidates or other prospects for employment, independent contractor or
consultant positions at or with any actual or prospective customer or client
of
Company and/or its affiliates, any and all confidential processes, inventions
or
methods of conducting business of the Company, its affiliates and/or its
clients, business partners or customers; (vi) acquisition or merger
targets; (vii) business plans or strategies, data, records, financial
information or other trade secrets concerning the actual or contemplated
business, strategic alliances, policies or operations of the Company or its
affiliates; or (viii) any and all versions of proprietary computer software
(including source and object code), hardware, firmware, code, discs, tapes,
data
listings and documentation of the Company; or (ix) any other confidential
information disclosed to Consultant by, or which Consultant is obligated under
a
duty of confidence from, the Company, its affiliates, and/or its clients,
business partners or customers providing that the information is not required
to
be divulged as a result of a subpoena or other such legal requirements and
rules.
3. Consultant
affirms that he does not possess and will not rely upon the protected trade
secrets or confidential or proprietary information of his prior employer(s)
in
providing services to the Company.
4. In
the
event that Consultant’s engagement with the Company terminates for any reason,
Consultant shall deliver forthwith to the Company any and all originals and
copies of Confidential Information, except Consultant shall be entitled to
retain a copy of his Board Materials for recordkeeping purposes.
9
B. Non-Solicitation.
1. For
a
period of one year following the termination of this Agreement and Consultant’s
engagement with the Company, in the Geographic Boundary, Consultant shall
not:
a. Directly
or indirectly through another person recruit, solicit or interfere with, or
attempt to recruit, solicit, interfere with, any employee, or independent
contractor of the Company to leave the employment (or independent contractor
relationship) thereof, whether or not any such employee or independent
contractor is party to an employment agreement. The Company acknowledges that
this Section will not be violated by general advertising or general
solicitations that are not targeted or directed specifically to employees of
the
Company, nor by the consideration or acceptance of unsolicited applications
for
employment by such individuals.
b. Interfere
with any relationship, contractual or otherwise, between the Company and any
other party, including; without limitation, any supplier, co-venturer or joint
venturer of the Company with the intent of causing such party to discontinue
or
reduce its business with the Company. The “Business of the Company” shall be
defined as a business the primary focus of which is the aggregation of websites
and selling advertising targeted to youth under the age of 18.
2. Consultant
further agrees that during the Term of this Agreement, he will not, directly
or
indirectly, engage, own, manage, operate, control, be employed by, consult
for,
participate in, render services for or be connected in any manner with the
ownership, management, operation or control of any business in direct
competition with the Business of the Company as defined above; provided,
however, Consultant may own, directly or indirectly, solely as a passive
investment, securities of any entity if (x) Consultant is not a controlling
person of, or a member of a group which controls, such entity and does not,
directly or indirectly, own more than 5% of any class of securities of such
entity, and (y) either (A) such entity is traded on any national securities
exchange, or (B) such interest is held indirectly by virtue of Consultant’s
limited partnership interest or other passive investment in an investment fund
in which Consultant has no investment discretion.
Consultant
agrees and acknowledges that by virtue of his position in the Company, he is
familiar with and in possession of the Company’s trade secrets, customer
information and other Confidential Information which are valuable to the Company
and that their goodwill, protection and maintenance constitute a legitimate
business interest of the Company, to be protected by the non-competition
restrictions set forth above. Consultant agrees and acknowledges that the
non-competition restrictions set forth herein are reasonable and necessary
and
do not impose undue hardship or burdens on Consultant. Consultant also
acknowledges that the products and services developed or provided by the
Company, its affiliates and/or its clients or customers are or are intended
to
be sold, provided, licensed and/or distributed to customers and clients in
and
throughout the United States (the “Geographic
Boundary”),
and
that the Geographic Boundary, scope of prohibited competition, and time duration
set forth in the non-competition restrictions set forth above are reasonable
and
necessary to maintain the value of the Confidential Information of, and to
protect the goodwill and other legitimate business interests of, the Company,
its affiliates and/or its clients or customers.
10
| IX. |
ARBITRATION
|
Any
dispute, controversy, or claim arising under, out of, in connection with, or
in
relation to this Agreement, or the breach termination, validity or
enforceability of any provision of this Agreement (“Arbitrable
Claims”),
will
be settled by final and binding arbitration conducted in accordance with and
subject to the Judicial Arbitration and Mediation Service’s (“JAMS”)
then-current JAMS Employment Arbitration Rules and Procedures (the “JAMS
Rules”),
or
such other alternative dispute resolution provider or process agreed by the
parties. Unless otherwise mutually agreed upon by the parties, the arbitration
hearings shall be conducted in San Francisco, California. A single arbitrator
shall be selected in accordance with the JAMS Rules (the “Arbitrator”)
and
the Arbitrator shall allow such discovery as is appropriate, consistent with
the
purposes of arbitration in accomplishing fair, speedy and cost effective
resolution of disputes. Judgment upon the award rendered in any such arbitration
may be entered in any court having jurisdiction thereof, or application may
be
made to such court for a judicial acceptance of the award and an enforcement
of
such award, as the law of such jurisdiction may require or allow. Other than
those matters involving injunctive relief as a remedy that cannot, as a matter
of law, be awarded by the Arbitration, or any action necessary to enforce the
award of the Arbitrator, the parties agree that the provisions of this Section
IX are a complete defense to any suit, action, or other proceeding instituted
in
any court or before any administrative tribunal with respect to any dispute,
controversy or claim arising under or in connection with this Agreement. The
Company shall pay all costs of the arbitration that would not otherwise be
incurred if the action were filed in court, including but not limited to any
filing fees, case administration fees, arbitrator fees and the arbitration
forum
costs. THE PARTIES HEREBY WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY
IN
REGARD TO THE ARBITRABLE CLAIMS.
| X. |
AMENDMENTS;
WAIVERS; REMEDIES
|
This
Agreement may not be amended or waived except by a writing signed by Consultant
and by a duly authorized representative of the Company other than Consultant.
Failure to exercise any right under this Agreement shall not constitute a waiver
of such right. Any waiver of any breach of this Agreement shall not operate
as a
waiver of any subsequent breaches. All rights or remedies specified for a party
herein shall be cumulative and in addition to all other rights and remedies
of
the party hereunder or under applicable law.
| XI. |
ASSIGNMENT;
BINDING EFFECT
|
A. Assignment.
The
performance of Consultant is personal hereunder, and Consultant agrees that
Consultant shall have no right to assign and shall not assign or purport to
assign any rights or obligations under this Agreement. This Agreement may be
assigned or transferred by the Company; and nothing in this Agreement shall
prevent the consolidation, merger or sale of the Company or a sale of any or
all
or substantially all of its assets.
11
B. Binding
Effect.
Subject
to the foregoing restriction on assignment by Consultant, this Agreement shall
inure to the benefit of and be binding upon each of the parties; the affiliates,
officers, directors, agents, successors and assigns of the Company; and the
heirs, devisees, spouses, legal representatives and successors of
Consultant.
| XII. |
NOTICES
|
All
notices or other communications required or permitted hereunder shall be made
in
writing and shall be deemed to have been duly given if delivered: (a) by hand;
(b) by a nationally recognized overnight courier service; or (c) by United
States first class registered or certified mail, return receipt requested,
to
the principal address of the other party, as set forth below. The date of notice
shall be deemed to be the earlier of (i) actual receipt of notice by any
permitted means, or (ii) five business days following dispatch by overnight
delivery service or the United States Mail. Consultant shall be obligated to
notify the Company in writing of any change in Consultant’s address. Notice of
change of address shall be effective only when done in accordance with this
paragraph.
Company’s
Notice Address:
GoFish
Corporation
000
Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx
Xxxxxxxxx, Xxxxxxxxxx, 00000
Facsimile:
(000) 000-0000
Consultant’s
Notice Address:
Xx.
Xxxxx
Xxxxxxxx
[ADDRESS]
| XIII. |
SEVERABILITY
|
If
any
provision of this Agreement shall be held by a court or arbitrator to be
invalid, unenforceable, or void, such provision shall be enforced to the fullest
extent permitted by law, and the remainder of this Agreement shall remain in
full force and effect. In the event that the time period or scope of any
provision is declared by a court or arbitrator of competent jurisdiction to
exceed the maximum time period or scope that such court or arbitrator deems
enforceable, then such court or arbitrator shall reduce the time period or
scope
to the maximum time period or scope permitted by law.
| XIV. |
TAXES
|
Notwithstanding
any provision in this Agreement to the contrary, the Company and Consultant
may
amend or modify the Agreement in any manner to provide for the application
and
effects of Section 409A of the Internal Revenue Code and any related regulatory
or administrative guidance issued by the Internal Revenue Service. The Company
shall delay the payment of any benefits payable under this Agreement to the
extent necessary to comply with Section 409A(a)(2)(B)(i) of the Code (relating
to payments made to certain “specified employees” of certain publicly-traded
companies) and in such event, any such amount to which the Consultant would
otherwise be entitled during the six (6) month period immediately following
his
separation from service will be paid on the first business day following the
expiration of such six (6) month period.
12
| XV. |
GOVERNING
LAW
|
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of California.
| XVI. |
INTERPRETATION
|
This
Agreement shall be construed as a whole, according to its fair meaning, and
not
in favor of or against any party. Sections and section headings contained in
this Agreement are for reference purposes only, and shall not affect in any
manner the meaning or interpretation of this Agreement. Whenever the context
requires, references to the singular shall include the plural and the plural
the
singular.
| XVII. |
COUNTERPARTS
|
This
Agreement may be executed in any number of counterparts, each of which shall
be
deemed an original of this Agreement, but all of which together shall constitute
one and the same instrument.
| XVIII. |
AUTHORITY
|
Each
party represents and warrants that such party has the right, power and authority
to enter into and execute this Agreement and to perform and discharge all of
the
obligations hereunder; and that this Agreement constitutes the valid and legally
binding agreement and obligation of such party and is enforceable in accordance
with its terms.
| XIX. |
ENTIRE
AGREEMENT
|
This
Agreement is intended to be the final, complete, and exclusive statement of
the
terms of Consultant’s engagement by the Company and may not be contradicted by
evidence of any prior or contemporaneous statements or agreements, except for
agreements specifically referenced herein (including the Indemnity Agreement,
the Lock-Up Agreement and any applicable stock option agreement, applicable
restricted stock unit agreement or other similar Company plan document). To
the
extent that the practices, policies or procedures of the Company, now or in
the
future, apply to Consultant, and to the extent that any applicable stock option
agreement, applicable restricted stock unit agreement or similar Company plan
document, are inconsistent with the terms of this Agreement, the provisions
of
this Agreement shall control. Any subsequent change in Consultant’s duties,
position, or compensation will not affect the validity or scope of this
Agreement.
13
| XX. |
CONSULTANT
ACKNOWLEDGEMENT
|
CONSULTANT
ACKNOWLEDGES THAT HE HAS HAD THE OPPORTUNITY TO CONSULT LEGAL COUNSEL CONCERNING
THIS AGREEMENT, THAT HE HAS READ AND UNDERSTANDS THE AGREEMENT, THAT HE IS
FULLY
AWARE OF ITS LEGAL EFFECT, AND THAT HE HAS ENTERED INTO IT FREELY BASED ON
HIS
OWN JUDGMENT AND NOT ON ANY REPRESENTATIONS OR PROMISES OTHER THAN THOSE
CONTAINED IN THIS AGREEMENT.
IN
WITNESS WHEREOF,
the
parties have duly executed this Agreement as of the date first written
above.
| GOFISH CORPORATION | XXXXX XXXXXXXX | ||
| By: /s/ Xxxxxxx Xxxxxx | By: /s/ Xxxxx Xxxxxxxx | ||
| Name: Xxxxxxx Xxxxxx | Xxxxx Xxxxxxxx | ||
| Title: President |
14
