Exhibit 10.1
EMPLOYMENT AGREEMENT
THIS AGREEMENT ("Agreement"), dated as of February 26,1999, is entered
into between Interactive Xxxxxxxxxxxx.Xxx, Ltd., a Delaware corporation (the
"Company"), and Xxxxxxx X. Xxxxxx (the "Executive").
Recitals
Executive is currently employed by the Company as a senior executive
officer and is an integral part of its management. The Board of Directors of the
Company recognizes the Executive as a key founding officer of the Company's
operating business, and consequently has approved the terms and conditions of
the continued employment of Executive as set forth herein and has authorized the
execution and delivery of this Agreement.
Agreement
For and in consideration of the foregoing and of the mutual covenants of
the parties herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. EMPLOYMENT. The Company hereby employs Executive to serve in the capacities
described herein and Executive hereby accepts such employment and agrees to
perform the services described herein upon the terms and conditions hereinafter
set forth.
2. TERM. The term of Executive's employment pursuant to this Agreement shall
commence as of the date hereof and shall terminate at the close of business on
January 01, 2005, subject to earlier termination in accordance with Section 9
hereof and the other terms, provisions, and conditions set forth herein.
3. DUTIES. Executive shall serve as and have the title of President and Chief
Executive Officer of the Company and shall be the chairman of the Company's
Board of Directors. Executive agrees to devote substantially all of his business
time, energy, and skills to such employment while so employed.
4. COMPENSATION.
(a) Base Compensation. The Company shall pay Executive, and
Executive agrees to accept, base compensation at the rate of not less than
$250,000 per year in equal, weekly installments commencing as of January 01,
2000, through the term of this Agreement ("Base Compensation"). The Base
Compensation specified in this Section 4(a) may be increased at any time during
the term of this Agreement in the discretion of the Board of Directors and will
be reviewed no less frequently than during the first quarter of each calendar
year beginning in 2000. No increase in the Base Compensation pursuant to this
Section 4(a) shall at any time operate as a cancellation of this Agreement; any
such increase shall operate merely as an amendment hereof, without any further
action by Executive or the Company. If any such increase or increases shall be
so authorized, all of the terms, provisions and conditions of this Agreement
shall remain in effect as herein provided, except that the Base Compensation set
forth
in this Section 4(a) shall be deemed amended to set forth the higher amount of
such Base Compensation to Executive.
(b) Bonus Compensation. The Company shall pay Executive an annual
bonus ("Bonus Compensation") within 90 days following the end of each fiscal
year of the Company during the term of Executive's employment under this
Agreement. The amount of Executive's Bonus Compensation shall be determined by
the Board of Directors of the Company, after consideration of any
recommendations made by the Compensation Committee of the Board of Directors,
based upon Executive's performance and the performance of the Company during
such year. See attached bonus plan.
(c) Annual Stock Options. Employee shall be eligible to receive an
annual stock option award (the "Annual Stock Options") following each fiscal
year of the Company in amounts, at such exercise prices, and on such terms as
the Board of Directors determines, based upon the performance of the Employee
and the Company during such fiscal year. See attached option schedule.
5. FRINGE BENEFITS.
(a) Generally. Executive shall be eligible for fringe benefits
pursuant to any insurance, pension or other employee fringe benefit plan
approved by the Board of Directors that now or hereafter may be made available
to employees of the Company and for which Executive will qualify according to
his eligibility under the provisions thereof; provided, however, that such
eligibility specifically does not apply to matters relating to Executive's
vacation, disability benefits, automobile allowance and compensation, which
matters shall be governed exclusively by the terms hereof.
(b) Vacation. During the term of this Agreement, Executive shall be
entitled to five (5) weeks paid vacation per calendar year and any vacation time
not taken during any calendar year shall be carried over into subsequent
calendar years.
(c) Automobile. The Company shall provide Executive with full use of
an automobile, appropriate for Executive's position and title, for Executive's
business and personal use, which automobile shall be replaced at least every
three years. The Company agrees to provide adequate insurance for the automobile
and occupants and to pay all maintenance and operating costs appropriate or
necessary to maintain such automobile in prime operating condition.
6. EXPENSES. During the period of his employment, Executive shall be reimbursed
for his business-related expenses incurred on behalf of the Company in
accordance with the travel and entertainment expense policy of the Company as
adopted by the Board of Directors from time to time and in effect at the time
the expense was incurred, but Executive shall be entitled to not less than
first-class for air travel. Executive agrees to maintain such records and
documentation of all such expenses to be reimbursed by the Company hereunder as
the Company shall require and in such detail as the Company may reasonably
request.
7. TERMINATION. The term of Executive's employment under this Agreement may be
terminated prior to expiration of the term provided in Section 2 hereof in
accordance with the
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following paragraphs. Any termination of the Executive's employment by the
Company for Cause or otherwise shall be communicated by Notice of Termination to
the Executive given in accordance with Section 14 hereof. A "Notice of
Termination" means a written notice which (i) indicates the specific termination
provision in this Agreement relied upon, (ii) sets forth in reasonable detail
the facts and circumstances claimed to provide a basis for termination of the
Executive's employment under the provision so indicated, and (iii) if the
termination date is other than the date of receipt of such notice, specifies the
termination date, which date shall not be more than sixty (60) calendar days
after the giving of such notice. The death or disability of Executive shall in
no event be deemed a termination of employment by Executive.
(a) Mutual. Executive's employment under this Agreement may be
terminated upon the mutual written agreement (which may include, if so agreed to
by the Board of Directors and Executive, severance payments and/or benefits) of
the Company and Executive.
(b) Death. In the event of the death of Executive, the Company may
terminate Executive's employment under this Agreement.
(c) Disability. If, during Executive's employment under this
Agreement, Executive shall become disabled and unable to perform his duties as
required herein ("Disability") for a consecutive period of one hundred eighty
(180) days, then the Company may, upon sixty (60) days' written notice to
Executive, terminate Executive's employment under this Agreement.
(d) Cause. Executive's employment under this Agreement may be
terminated by the Company, with Cause as herein defined upon giving Executive
sixty (60) days written notice. For purposes of this Agreement, the term "Cause"
shall mean the termination of the Executive by the Board of Directors of the
Company as a result of the existence or occurrence of one or more of the
following conditions or events:
(i) An act or acts of fraud, misappropriation, or embezzlement
on the Executive's part that result in or are intended to result in his personal
enrichment at the expense of the Company or its subsidiaries or affiliates.
(ii) Conviction of a felony that (a) arises in connection with
the Company's business and (b) has a material adverse effect on the Company's
business.
(iii) The Executive's willful or intentional failure to
perform his duties as required under this Agreement; provided, that the Company
shall provide Executive with written notice of such failure and Executive shall
have thirty (30) days from the date Executive receives such notice to remedy
such failure to perform.
(e) Change of Control. In the event of a "Change in Control" (as
defined in this Section 7(e)), Executive may elect, at any time during the
180-day period immediately following such Change in Control, to deliver 60 days'
written notice to the Company of his termination of employment hereunder.
Termination of Executive's employment under this
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Agreement pursuant to the provisions of the preceding sentence shall be deemed a
termination without Cause for purposes of Section 9 hereof and shall not be
deemed to be a voluntary resignation or termination by Executive. For purposes
of this Agreement, a "Change in Control" shall be deemed to have occurred when:
(i) any person, including a "group" as defined in Section
13(d)(3) of the Securities Exchange Act of 1934, as amended, who owns less than
20% of the Company's capital stock on the date hereof, becomes the beneficial
owner of twenty-five percent or more of the capital stock of the Company;
(ii) the Company is merged with or into any other company
where members of the board of directors of the Company immediately prior to such
transaction do not constitute a majority of the board of directors of the
Company of the surviving entity immediately following such transaction, or
substantially all of the Company's assets are acquired by any other company; or
(iv) three or more directors nominated by the Board of
Directors to serve as a director, each having agreed to serve in such capacity,
fail to be elected in a contested election of directors.
8. DEATH AND DISABILITY. In the event of the termination of Executive's
employment under this Agreement by reason of the Executive's death or
Disability, the Company shall pay Executive (or his heirs and/or personal
representatives): (i) Executive's Base Compensation, unused vacation
entitlement, and other benefits until termination date of contract, and (ii)
Executive's Bonus Compensation payable under Section 4 and Executive's Annual
Stock Options for the fiscal year in which Executive's termination occurred, as
if Executive had been employed by the Company for the full fiscal year.
9. SEVERANCE. In the event of the termination of Executive's employment under
this Agreement for any reason other than Executive's death or disability, the
Company shall provide the payments and benefits to Executive as indicated below:
(a) With Cause or Voluntary Resignation. If Executive is terminated
for Cause (as defined in Section 7(d) of this Agreement), or if Executive
voluntarily terminates his employment by the Company, the Company shall pay
Executive, within five (5) business days after the date of termination,
Executive's Base Compensation, unused vacation entitlement and all expenses in
connection with Executive's use of the automobile under Section 5(c) hereof
through such date of termination, and the Company shall have no further
obligation to provide compensation or benefits to Executive under this
Agreement; except that, to the extent that the Company's insurance, stock option
and other benefit plans provide certain rights and benefits after an employee's
termination, Executive may continue to receive such rights and benefits in
accordance with the terms of such plans.
(b) Without Cause or Due to Change of Control. If terminated by the
Company without Cause or by the Executive as a result of a Change of Control,
Executive shall
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receive the Base Compensation, Bonus Compensation, Annual Stock Options, and the
other benefits under this Agreement until the later to occur of (x) the date
thirty-six (36) months from the date of such termination and (y) January 01,
2005.
10. CONFIDENTIAL INFORMATION. Executive recognizes and acknowledges that he will
have access to certain confidential information of the Company and of
corporations with whom the Company does business, and that such information
constitutes valuable, special and unique property of the Company and such other
corporations. During the term of this Agreement and for a period of five (5)
years immediately following the date of termination of this Agreement, Executive
agrees not to disclose or use any confidential information, including without
limitation, information regarding research, developments, "know-how," prices,
suppliers, customers, costs or any knowledge or information with respect to
confidential or trade secrets of the Company, it being understood that such
confidential information does not include information that is publicly available
unless such information became publicly available as a result of a breach of
this Agreement. Executive acknowledges and agrees that all notes, records,
reports, sketches, plans, unpublished memoranda or other documents belonging to
the Company, but held by Executive, concerning any information relating to the
Company's business, whether confidential or not, are the property of the Company
and will be promptly delivered to it upon Executive's leaving the employ of the
Company. Executive also agrees to execute such confidentiality agreements that
the Board may adopt, and may modify from time to time, as a standard form to be
executed by all employees of the Company, to the extent such standard forms are
not materially more restrictive than the provisions of this Agreement.
11. INTELLECTUAL PROPERTY. Executive acknowledges and agrees that all
discoveries, inventions, designs, improvements, ideas, writings, copyrights,
publications, study protocols, study results, computer data or programs, or
other intellectual property, whether or not subject to patent or copyright laws,
which Executive shall conceive solely or jointly with others, in the course or
scope of his employment with the Company or in any way related to the Company's
business, whether during or after working hours, or with the use of the
Company's equipment, materials or facilities (collectively referred to herein as
"Intellectual Property"), shall be the sole and exclusive property of the
Company without further compensation to Executive. As used in this Section 11
and the following Section 12, it is understood that the Company's principal
"business" is marketing internet related products such as benefits, mortgages,
and web sites. Executive shall take such steps as are deemed necessary to
maintain complete and current records of the Intellectual Property conceived by
the Executive, and Executive shall assign to the Company or its designees, the
entire right, title and interest in said Intellectual Property.
12. NON-COMPETITION. Executive acknowledges that his services to be rendered
hereunder are of a special and unusual character that have a unique value to the
Company and the conduct of its business, the loss of which cannot adequately be
compensated by damages in an action at law. In view of the unique value to the
Company of the services of Executive for which the Company has contracted
hereunder, and because of the confidential information to be obtained by or
disclosed to Executive as herein above set forth, and as a material inducement
to the Company to enter into this Agreement and to pay and make available to
Executive the compensation and other benefits referred to herein, Executive
covenants and agrees that
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Executive will not, directly or indirectly, whether as principal, agent, trustee
or through the agency of any corporation, partnership, association or agent
(other than as the holder of not more than 10% of the total outstanding stock of
any company the securities of which are traded on a regular basis on recognized
securities exchanges):
(a) while employed under this Agreement and for any period during
which Executive is receiving payments from the Company (pursuant to Section 8
hereof) following a termination as a result of Employee's Disability, (i) work
for (in any capacity, including without limitation director, officer or
employee) any other business or company that competes with the Company and is
located in the United States or within 50 miles of any branch office of the
Company, or (ii) recruit, or otherwise influence or attempt to induce employees
of the Company to leave the employment of the Company; and
(b) for the one-year period immediately following the termination of
this Agreement due to the expiration of the term of this Agreement, termination
of Executive for Cause, or Executive's voluntary resignation; and for the
one-year period immediately following the last date on which Employee shall
receive payments from the Company pursuant to Section 8 hereof following a
termination of employment as a result of Employee's Disability, work for a
company or business (in any capacity, including without limitation as director,
officer, or employee) that is in the business of marketing internet related
products such as benefits, mortgages, and web sites , that competes with the
Company and is located in the United States or within 50 miles of any branch
office of the Company.
Executive has carefully read and considered the provisions of Sections 10,
11, and 12 hereof and agrees that the restrictions set forth in such sections
are fair and reasonable and are reasonably required for the protection of the
interests of the Company, its officers, directors, shareholders, and other
employees, for the protection of the business of the Company, and to ensure that
Executive devotes his full-time and efforts to the business of the Company.
Executive acknowledges that he is qualified to engage in businesses other than
those that are subject to this Section 12. It is the belief of the parties,
therefore, that the best protection that can be given to the Company that does
not in any way infringe upon the rights of Executive to engage in any unrelated
businesses is to provide for the restrictions described above. In view of the
substantial harm which would result from a breach by Executive of Sections 10,
11 and 12, the parties agree that the restrictions contained therein shall be
enforced to the maximum extent permitted by law. In the event that any of said
restrictions shall be held unenforceable by any court of competent jurisdiction,
the parties hereto agree that it is their desire that such court shall
substitute a reasonable judicially enforceable limitation in place of any
limitation deemed unenforceable and that as so modified, the covenant shall be
as fully enforceable as if it had been set forth herein by the parties.
13. REMEDIES. The provisions of sections 10, 11 and 12 of this Agreement shall
survive the termination of this Agreement as set forth therein, regardless of
the circumstances or reasons for such termination, and inure to the benefit of
the Company. The restrictions set forth in Sections 10, 11 and 12 are considered
to be reasonable for the purposes of protecting the business of the Company. The
Company and Executive acknowledge that the Company would
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be irreparably harmed and that monetary damages would not provide an adequate
remedy to the Company if the covenants contained in Sections 10, 11 and 12 were
not complied with in accordance with their terms. Accordingly, Executive agrees
that the Company shall be entitled to injunctive and other equitable relief to
secure the enforcement of these provisions, in addition to any other remedy
which may be available to the Company, and that the Company shall be entitled to
receive from Executive reimbursement for reasonable attorneys' fees and expenses
incurred by the Company in enforcing these provisions.
14. NOTICES. Any notice required or permitted to be given under this Agreement
shall be sufficient if in writing and if sent by registered mail to the
addresses below or to such other address as either party shall designate by
written notice to the other:
If to the Executive: To the address set forth below his signature on the
signature page hereof.
If to the Company:
15. ENTIRE AGREEMENT; MODIFICATION.
(a) This Agreement contains the entire agreement of the Company and
Executive, and the Company and Executive hereby acknowledge and agree that this
Agreement supersedes any prior statements, writings, promises, understandings or
commitments.
(b) No future oral statements, promises or commitments with respect
to the subject matter hereof, or other purported modification hereof, shall be
binding upon the parties hereto unless the same is reduced to writing and signed
by each party hereto.
16. ASSIGNMENT. The rights and obligations of the Company under this Agreement
shall inure to the benefit of and shall be binding upon the successors and
assigns of the Company. The Executive may not assign his rights and obligations
under this Agreement.
17. FULL SETTLEMENT. The Executive shall not be obligated to seek other
employment by way of mitigation of the amounts payable to the Executive under
any of the provisions of this Agreement. The amounts payable to Executive under
this Agreement shall not be reduced by any compensation payable to Executive
from employment by another employer after the date of Executive's termination
provided such employment does not violate the terms of Section 12 hereof. The
Company agrees to pay all legal fees and expenses which the Executive may
reasonably incur as a result of any contest by the Executive or the Company or
others of the validity or enforceability of, or liability under any provision of
this Agreement or any guarantee of performance thereof, in each case plus
interest, provided that the Executive is the prevailing party in any such
contest. If the Executive is not the prevailing party each party shall pay its
own legal fees and expenses except that if such contest is the result of a
claimed breach of Section 10, 11 or 12, and the Company shall be the prevailing
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party, the Executive shall pay the reasonable legal fees and expenses of the
Company. The determination of the prevailing party in any contest shall be made
by the tribunal which shall resolve such contest, or by the parties if such
contest is settled without resort to any such tribunal.
18. MISCELLANEOUS.
(a) This agreement shall be subject to and governed by the laws of
the State of Florida, without regard to the conflicts of laws principles
thereof.
(b) The section headings contained herein are for reference purposes
only and shall not in any way affect the meaning or the interpretation of this
Agreement.
(c) The failure of any party to enforce any provision of this
Agreement shall in no manner affect the right to enforce the same, and the
waiver by any party of any breach of any provision of this Agreement shall not
be construed to be a waiver by such party of any succeeding breach of such
provision or a waiver by such party of any breach of any other provision.
(d) All written notices required in this Agreement shall be sent
postage prepaid by certified or registered mail, return receipt requested.
(e) In the event any one or more of the provisions of this Agreement
shall for any reason be held invalid, illegal or unenforceable, the remaining
provisions of this Agreement shall be unimpaired, and the invalid, illegal or
unenforceable provision shall be replaced by a mutually acceptable valid, and
enforceable provision which comes closest to the intent of the parties.
(f) This Agreement may be executed in any number of counterparts,
each of which shall constitute an original and all of which together shall
constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties have executed this Employment Agreement as
of the day and year first above written.
Interactive Xxxxxxxxxxxx.xxx, Ltd., a Delaware corporation
By:___________________________________________________________
Its:
______________________________________________________________
Xxxxxxx X. Xxxxxx
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