EXHIBIT 10.31
EMPLOYMENT AGREEMENT
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EMPLOYMENT AGREEMENT ("Agreement") dated as of July 1, 2003 (the "Effective
Date") between Xxxxxx Interactive Inc., a Delaware corporation ("Company"), and
Xxxxxxx X. Xxxxx ("Executive").
BACKGROUND
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Executive has served as the Chief Technology Officer of Company since 1978.
Executive and Company are parties to a Confidentiality and Non-Competition
Agreement dated September 1, 1999 (the "Prior Agreement").
Company desires to have Executive serve as its Executive Vice President, Chief
Scientist, and Chief Technology Officer on the terms and conditions contained in
this Agreement, and to replace the Prior Agreement with this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
contained herein and intending to be legally bound hereby, the parties hereto
agree as follows:
TERMS
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SECTION 1. CAPACITY AND DUTIES
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1.1 EMPLOYMENT; ACCEPTANCE OF EMPLOYMENT. Company hereby employs Executive
and Executive hereby accepts employment by Company for the period and upon the
terms and conditions hereinafter set forth.
1.2 CAPACITY AND DUTIES.
(a) Executive shall serve as the Executive Vice President, Chief
Scientist, and Chief Technology Officer of Company. Executive shall perform
duties and shall have authority as may from time to time be specified by the
Chief Executive Officer and the Board of Directors of Company (the "Board");
provided, however, that Executive shall not be required to perform duties not
normally performed by a person filling the role of chief scientist or chief
technology officer of comparable companies. Executive will report to the
Chairman and Chief Executive Officer. Executive shall perform his duties for
Company principally at Company's executive offices, presently in Rochester, New
York, provided, however, that Executive acknowledges and agrees that travel to
Company's and its affiliates' various offices, and to other locations in
furtherance of Company's business, will be required in connection with the
performance of Executive's duties hereunder.
(b) Company shall use its reasonable efforts to cause Executive to be
elected a member of the Board during the period this Agreement is in effect, but
the failure of the stockholders of Company to elect the Executive a member of
the Board shall not constitute a breach of this Agreement by Company.
(c) Executive shall devote full time efforts to the performance of
Executive's duties hereunder, in a manner that will faithfully and diligently
further the business and interests of Company.
SECTION 2. TERM OF EMPLOYMENT
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2.1 TERM. The term of Executive's employment hereunder, for all purposes of
this Agreement, shall commence on the Effective Date (the "Commencement Date")
and continue through and including June 30, 2005, as further extended or unless
sooner terminated in accordance with the other provisions hereof (collectively,
the "Term", with the initial two years of the Term called the "Initial Term").
Except as hereinafter provided, on the expiration of the Initial Term this
Agreement shall be automatically extended for an additional one-year term, and
if so extended shall be automatically extended for successive additional
one-year terms, unless either the Executive or Company shall have given the
other written notice of nonrenewal of this Agreement at least six (6) months
prior to the end of the Initial Term or any one-year extension term then in
effect. If written notice of nonrenewal is given as provided above, Executive's
employment under this Agreement shall terminate on June 30, 2005, or if the Term
has automatically renewed, on the June 30 immediately following the date of the
non-renewal notice.
SECTION 3. COMPENSATION
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3.1 BASE COMPENSATION. As compensation for Executive's services, Company
shall pay to Executive base compensation in the form of salary ("Base
Compensation") in the amount of $330,000 per annum for the period from and
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including the Commencement Date through and including June 30, 2004, and in the
amount of $350,000 per annum thereafter. The salary shall be payable in periodic
installments in accordance with Company's regular payroll practices for its
executive personnel at the time of payment, but in no event less frequently than
monthly. The Compensation Committee of the Board shall review Base Compensation
periodically for the purpose of determining whether Base Compensation should be
adjusted; provided, however, that Executive's Base Compensation shall not be
less than the applicable amount set forth in this Section 3.1.
3.2 PERFORMANCE BONUS. As additional compensation for the services rendered
by Executive to Company, Executive shall be eligible for a performance bonus
payable in full at the same time as payment of other executive bonuses by the
Company (generally targeted for payment within ninety (90) days after the end of
the relevant fiscal year of the Company). The performance bonus award criteria
shall be based on the same Company performance guidelines as those established
for the Chief Operating Officer and the Chief Executive Officer, and the bonus
amount shall be in the highest tier of bonuses awarded in applicable period
pursuant to those award criteria (being the same tier as used to determine any
additional bonuses paid to the Chief Operating Officer and Chief Executive
Officer for the same period).
3.3 EMPLOYEE BENEFITS. During the Term, Executive shall be entitled to
participate in such of Company's employee benefit plans and benefit programs,
including medical, hospitalization, dental, disability, accidental death and
dismemberment and travel accident plans and programs, as may from time to time
be provided by Company for its senior executives generally. In addition, during
the Term Executive shall be eligible to participate in all pension, retirement,
savings and other employee benefit plans and programs maintained from time to
time by Company for the benefit of its senior executives generally. Company
shall have no obligation, however, to maintain any particular program or level
of benefits referred to in this Section 3.3.
3.4 OTHER BENEFITS. During the Term, the Company shall provide Executive
with an automobile allowance of $1,000.00 per month for the use of an automobile
owned or leased by him in accordance with the policies and procedures
established by the Company from time to time for executive employees.
3.5 VACATION. In view of his more than twenty year service to the Company,
Executive shall be entitled to the normal and customary amount of paid vacation
provided to senior executive officers of the Company, but in no event less than
25 days during each 12 month period. Any vacation days that are not taken in a
given 12 month period shall accrue and carry over from year to year up to a
maximum of 25 days. The Executive may be granted leaves of absence with or
without pay for such valid and legitimate reasons as the Board in its sole and
absolute discretion may determine, and is entitled to the same sick leave and
holidays provided to other senior executive officers of Company.
3.6 EXPENSE REIMBURSEMENT. Company shall reimburse Executive for all
reasonable and documented expenses incurred by him in connection with the
performance of Executive's duties hereunder in accordance with its regular
reimbursement policies as in effect from time to time.
3.7 LIFE INSURANCE. Company shall continue to maintain the Executive's
existing $250,000 term life insurance policy during the Term so long as such
coverage continues to be available to the Company at a cost no greater than the
last premium paid prior to the Commencement Date; provided, however, if such
cost increases, Company will so advise Executive and will continue to maintain
such insurance if Executive pays the cost in excess of the last premium paid
prior to the Commencement Date. Executive may continue to designate the
beneficiary of the policy and Company shall treat the cost of the insurance paid
by the Company as compensation to the Executive for tax and other business
purposes. Company shall not be required to maintain such life insurance if such
coverage is not reasonably available for purchase by the Company.
SECTION 4. TERMINATION OF EMPLOYMENT
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4.1 DEATH OF EXECUTIVE. If Executive dies during the Term, Company shall
not thereafter be obligated to make any further payments hereunder other than
amounts for (i) Base Compensation, (ii) any Performance Bonus earned before the
date of death (including a prorated Performance Bonus for the period ending
before death calculated by annualizing the short period before death), (iii)
expense reimbursement, (iv) other amounts which have accrued as of the date of
Executive's death in accordance with generally accepted accounting principles,
and (v) the non-competition payment described in Section 5.4 (collectively, the
"Accrued Obligations", which, for purposes of this Agreement in situations other
than death, shall reference the date of termination).
4.2 DISABILITY OF EXECUTIVE. If Executive is permanently disabled (as
defined in Company's long-term disability insurance policy then in effect), then
the Board shall have the right to terminate Executive's employment upon 30 days'
prior written notice to Executive at any time during the continuation of such
disability ("Disability"). In the event Executive's employment is terminated for
Disability in accordance with this Section 4.2, Company shall not thereafter be
obligated to make any further payments hereunder other than Accrued Obligations
through the date of such termination.
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4.3 TERMINATION FOR CAUSE. Executive's employment hereunder shall terminate
immediately upon notice that the Board is terminating Executive for Cause (as
defined herein), in which event Company shall not thereafter be obligated to
make any further payments hereunder other than Accrued Obligations. "Cause"
shall be limited to the following:
(i) willful failure to substantially perform Executive's duties
as described in Section 1.2 after demand for substantial performance is
delivered by Company in writing that specifically identifies the manner in which
Company believes Executive has not substantially performed Executive's duties
and Executive's failure to cure such non-performance within ten (10) days after
receipt of the Company's written demand; provided, however, that a failure to
perform such duties during the remedy period set forth in Section 4.4(b)(i)
hereof following the issuance of a Notice of Termination (as herein defined) by
Executive for Good Reason shall not be Cause unless an arbitrator acting
pursuant to Section 6.1 hereof finds Executive to have acted in bad faith in
issuing such Notice of Termination;
(ii) willful misconduct that is materially and demonstrably
injurious to Company or any of its subsidiaries; or
(iii) conviction or plea of guilty or nolo contendere to a felony
or to any other crime which involves moral turpitude or, if not including moral
turpitude, provided the act giving rise to such conviction or plea is materially
and demonstrably injurious to the Company or any of its subsidiaries;
(iv) material violation of (x) Company's policies relating to
sexual harassment, substance or alcohol abuse, (y) Section 5 of this Agreement,
or (z) other Company polices set forth in Company manuals or written statements
of policy provided that in the case of this clause (z) that such violation is
materially and demonstrably injurious to Company and continues for more then
three (3) days after written notice thereof is given to Executive by the Board;
and
(v) material breach of any material provision of this Agreement
by Executive, which breach continues for more than ten days after written notice
thereof is given by the Board to Executive.
Cause shall not exist under this Section 4.3 unless and until Company has
delivered to Executive a copy of a resolution duly adopted by a majority of the
members of the Board then in office, at a meeting of the Board duly called and
held for such purpose or by written consent, finding that Cause exists in the
good faith opinion of the Board. This Section 4.3 shall not prevent Executive
from challenging in any arbitration proceeding or court of competent
jurisdiction the Board's determination that Cause exists, or that Executive has
failed to cure any act (or failure to act), to the extent permitted by this
Agreement, that purportedly formed the basis for the Board's determination.
Company must provide written notice to Executive that it is intending to
terminate Executive's employment for Cause within one hundred and twenty (120)
days after the Board has actual knowledge of the occurrence of the latest event
it believes constitutes Cause.
4.4 TERMINATION WITHOUT CAUSE OR BY EXECUTIVE FOR GOOD REASON.
(a) The Company reserves the right to terminate Executive's employment
at any time. If, however, (i) Executive's employment is terminated by Company
other than at the end of the Term (as the same may have been extended pursuant
to Section 2.1 of this Agreement) for any reason other than Cause under Section
4.3, death, or Disability, or (ii) Executive's employment is terminated by
Executive for Good Reason other than at the end of the Term (as the same may
have been extended pursuant to Section 2.1 of this Agreement), then Company
shall pay to Executive the Accrued Obligations through the date of termination,
and shall continue to make payments (or, in the case of benefits, provide an
economic equivalent) to Executive as required by Sections 3.1, 3.3, 3.4, and 3.7
of this Agreement through and including the date of expiration of the Term (as
the same may have been extended pursuant to Section 2.1 of this Agreement).
(b) "Good Reason" shall mean the following:
(i) material breach of Company's obligations hereunder, including
any assignment of duties not part of duties normally performed by persons
holding the position of chief scientist or chief technology officer of
comparable companies unless previously agreed to in writing by Executive,
provided that Executive shall have given reasonably specific written notice
thereof to Company, and Company shall have failed to remedy the circumstances
within sixty (60) days thereafter;
(ii) any decrease in Executive's salary as it may have increased
during the Term, except for decreases that are in conjunction with decreases in
executive salaries by the Company generally and that do not result in a decrease
in Executive's annual salary below $330,000 per annum on or before June 30, 2004
and $350,000 thereafter;
(iii) the failure of Executive to be appointed to all of the
positions set forth in Section 1.2(a), ie., Executive Vice President, Chief
Scientist, and Chief Technology Officer, or the failure of the Board to nominate
Executive for
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election as a member of the Board, provided, however, the failure of the
stockholders to elect Executive to the Board if he has been duly nominated for
election at the annual meeting of stockholders of the Company shall not
constitute Good Reason;
(iv) the relocation of Executive's principal office to a location
more than twenty-five (25) miles from Rochester, New York; provided, however,
that Executive's principal office shall not be deemed to be relocated by virtue
of Executive being required to spend up to five (5) working days per month on
average in the Company's and its subsidiary's other offices;
(v) the failure of any successor in interest of Company to be
bound by the terms of this Agreement in accordance with Section 6.4 hereof; or
(vi) substantial interference by the Board or Chief Executive
Officer with Executive's performance of Executive's duties, which interference
results in the inability of Executive to substantially perform Executive's
duties hereunder, provided that Executive shall have given reasonably specific
written notice thereof to the Board, such situation shall not have been
corrected within thirty (30) days, and the Board shall have determined, in its
sole discretion, that such interference exists and results in the inability of
Executive to substantially perform Executive's duties hereunder.
(vii) Executive must provide notice to the Company that he is
intending to terminate Executive's employment for Good Reason within one hundred
and twenty (120) days after Executive has actual knowledge of the occurrence of
the latest event he believes constitutes Good Reason, which termination notice
shall specify a termination date within thirty (30) days after the date of such
notice except for termination under subsection (i) or (vi) in which case the
termination date shall be as provided in such subsection. Executive's right to
terminate Executive's employment hereunder for Good Reason shall not be affected
by Executive's subsequent Disability provided that the notice of intention to
terminate is given prior to the onset of such Disability. Subject to compliance
by Executive with the notice provisions of this Section 4.4, Executive's
continued employment prior to terminating employment for Good Reason shall not
constitute consent to, or a waiver of rights with respect to, any act or failure
to act constituting Good Reason. In the event Executive delivers to the Company
a Notice of Termination for Good Reason, Executive agrees to appear before a
meeting of the Board called and held for such purpose (after reasonable notice)
and specify to the Board the particulars as to why Executive believes adequate
grounds for termination for Good Reason exist. No action by the Board, other
than the remedy of the circumstances within the time periods specified in
Section this 4.4, shall be binding on Executive.
4.5 TERMINATION BY EXECUTIVE WITHOUT GOOD REASON. In the event Executive's
employment is voluntarily terminated by Executive without Good Reason, Company
shall not be obligated to make any further payments to Executive hereunder other
than Accrued Obligations, excluding the portion of Accrued Obligations related
to Performance Bonus, through the date of such termination.
4.6 MITIGATION. Executive shall not be required to mitigate amounts payable
under this Section 4 by seeking other employment or otherwise, and there shall
be no offset against amounts due Executive under this Agreement on account of
subsequent employment except as specifically provided herein.
SECTION 5. NON-COMPETITION AND CONFIDENTIALITY
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5.1 NON-COMPETITION
(a) During the period that Executive is employed by the Company, and
for a period of one year after the first to occur of (i) the Company's
termination of Executive's employment pursuant to Section 4.2 or 4.3 of this
Agreement, (ii) the Executive's termination of his employment other than for
Good Reason, and (iii) the end of the Term (as extended pursuant to Section 2.1
of this Agreement (the "Non-Competition Period"), Executive shall not, directly
or indirectly, own, manage, operate, join, control, participate in, invest in or
otherwise be connected or associated with, in any manner, including, without
limitation, as an officer, director, employee, distributor, independent
contractor, independent representative, partner, consultant, advisor, agent,
proprietor, trustee or investor, any Competing Business; provided, however, that
ownership of 4.9% or less of the stock or other securities of a corporation, the
stock of which is listed on a national securities exchange or is quoted on the
NASDAQ Stock Market's National Market, shall not constitute a breach of this
Section 5, so long as the Executive does not in fact have the power to control,
or direct the management of, or is not otherwise engaged in activities with,
such corporation.
(b) For purposes hereof, the term "Competing Business" shall mean any
business or venture which is substantially similar to the whole or any
significant part of the business conducted by Company.
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(c) Notwithstanding the above, the non-competition obligation in
Section 5.1(a) shall not apply if the Company fails to make the payment required
by Section 5.4 of this Agreement.
5.2 NO SOLICITATION. During the Noncompetion Period, the Executive shall
not, directly or indirectly, including on behalf of, for the benefit of, or in
conjunction with, any other person or entity, (i) solicit, assist, advise,
influence, induce or otherwise encourage in any way, any employee of Company to
terminate such employee's relationship with Company for any reason, or assist
any person or entity in doing so, or employ, engage or otherwise contract with
any employee or former employee of Company in a Competing Business or any other
business unless such former employee shall not have been employed by Company for
a period of at least one year and no solicitation prohibited hereby shall have
occurred prior to the end of such one-year period, (ii) interfere in any manner
with the relationship between any employee and Company, or (iii) contact,
service or solicit any existing clients, customers or accounts of Company on
behalf of a Competing Business, either as an individual on Executive's own
account, as an investor, or as an officer, director, partner, joint venturer,
consultant, employee, agent or salesman of any other person or entity.
5.3 CONFIDENTIAL INFORMATION
(a) "Confidential Information" shall mean all proprietary or
confidential records and information, including, but not limited to,
development, marketing, purchasing, organizational, strategic, financial,
managerial, administrative, manufacturing, production, distribution and sales
information, distribution methods, data, specifications, technologies, methods,
and processes (including the Transferred Property as hereinafter defined)
presently owned or at any time hereafter developed by Company, or its agents,
consultants, or otherwise on its behalf, or used presently or at any time
hereafter in the course of the business of Company, that are not otherwise part
of the public domain.
(b) Executive hereby sells, transfers and assigns to Company, or to
any person or entity designated by Company, all of Executive's entire right,
title and interest in and to all inventions, ideas, methods, developments,
disclosures and improvements (the "Inventions"), whether patented or unpatented,
and copyrightable material, and all trademarks, trade names, all goodwill
associated therewith and all federal and state registrations or applications
thereof, made, adopted or conceived by solely or jointly, in whole or in part
prior to or during the Term which (i) relate to methods, apparatus, designs,
products, processes or devices sold, leased, used or under construction or
development by Company or (ii) otherwise relate to or pertain to the business,
products, services, functions or operations of the Company (collectively, the
"Transferred Property"). Executive shall make adequate written records of all
Inventions, which records shall be Company's property and shall communicate
promptly and disclose to Company, in such forms Company requests, all
information, details and data pertaining to the aforementioned Inventions.
Whether during the Term or thereafter, Executive shall execute and deliver to
Company such formal transfers and assignments and such other papers and
documents as may be required of Executive to permit Company, or any person or
entity designated by Company, to file and prosecute patent applications
(including, but not limited to, records, memoranda or instruments deemed
necessary by Company for the prosecution of the patent application or the
acquisition of letters patent in the United states, foreign counties or
otherwise) and, as to copyrightable material, to obtain copyrights thereon, and
as to trademarks, to record the transfer of ownership of any federal or state
registrations or applications.
(c) All Confidential Information is considered secret and will be
disclosed to the Executive in confidence, and Executive acknowledges that, as a
consequence of Executive's employment and position with Company, Executive may
have access to and become acquainted with Confidential Information. Except in
the performance of Executive's duties as an employee of Company, Executive shall
not, during the term and at all times thereafter, directly or indirectly for any
reason whatsoever, disclose or use any such Confidential Information. All
records, files, drawings, documents, equipment and other tangible items (whether
in electronic form or otherwise), wherever located, relating in any way to or
containing Confidential Information, which Executive has prepared, used or
encountered or shall in the future prepare, use or encounter, shall be and
remain Company's sole and exclusive property and shall be included in the
Confidential Information. Upon termination of this Agreement, or whenever
requested by Company, Executive shall promptly deliver to Company any and all of
the Confidential Information and copies thereof, not previously delivered to
Company, that may be in the possession or under the control of the Executive.
The foregoing restrictions shall not apply to the use, divulgence, disclosure or
grant of access to Confidential Information to the extent, but only to the
extent, (i) expressly permitted or required pursuant to any other written
agreement between Executive and Company, (ii) such Confidential Information has
been publicly disclosed (not due to a breach by the Executive of Executive's
obligations hereunder, or by breach of any other person, of a fiduciary or
confidential obligation to Company) or (iii) the Executive is required to
disclose Confidential Information by or to any court of competent jurisdiction
or any governmental or quasi-governmental agency, authority or instrumentality
of competent jurisdiction, provided, however, that the Executive shall, prior to
any such disclosure, immediately notify Company of such requirements and
provided further, however, that the Company shall have the right, at its
expense, to object to such disclosures and to seek confidential treatment of any
Confidential Information to be so disclosed on such terms as it shall determine.
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5.4 CONSIDERATION FOR SECTION 5 COVENANTS. As consideration for Executive's
agreement to be bound by the obligations contained in this Section 5, Company
shall pay Executive the sum of Five Hundred Thousand Dollars ($500,000.00) in a
lump sum within thirty (30) days after the the first to occur of (i) the
Company's termination of Executive's employment pursuant to Section 4.2 or 4.3
of this Agreement, (ii) the Executive's termination of his employment other than
for Good Reason, (iii) the Employee's death, and (iv) the end of the Term (as it
may have been extended pursuant to Section 2.1 of this Agreement).
5.5 ACKNOWLEDGEMENT; REMEDIES; SURVIVAL OF THIS AGREEMENT
(a) Executive acknowledges that violation of any of the covenants and
provisions set forth in Section 5 of this Agreement would cause Company
irreparable damage and agrees that Company's remedies at law for a breach or
threatened breach of any of the provisions of this Agreement would be inadequate
and, in recognition of this fact, in the event of a breach or threatened breach
by Executive of any of the provisions of this Agreement, it is agreed that, in
addition to the remedies at law or in equity, Company shall be entitled, without
the posting of a bond, to equitable relief in the form of specific performance,
a temporary restraining order, temporary or permanent injunction, or any other
equitable remedy which may then be available for the purposes of restraining
Executive from any actual or threatened breach of such covenants. Without
limiting the generality of the foregoing, if Executive breaches or threatens to
breach this Section 5 hereof, such breach or threatened breach will entitle
Company (i) to terminate its obligations to make further payments otherwise
required under this Agreement, and (ii) to enjoin Executive from disclosing any
Confidential Information to any Competing Business, to enjoin any Competing
Business from retaining Executive or using any such Confidential Information,
and to enjoin Executive from rendering personal services to or in connection
with any Competing Business. The rights and remedies of the parties hereto are
cumulative and shall not be exclusive, and each such party shall be entitled to
pursue all legal and equitable rights and remedies and to secure performance of
the obligations and duties of the other under this Agreement, and the
enforcement of one or more of such rights and remedies by a party shall in no
way preclude such party from pursuing, at the same time or subsequently, any and
all other rights and remedies available to it.
(b) The provisions of this Section 5 shall survive the termination of
Executive's employment with Company.
SECTION 6. MISCELLANEOUS
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6.1 ARBITRATION. Any dispute or controversy arising under or in connection
with this Agreement shall be settled exclusively by arbitration in Rochester,
New York, in accordance with the Commercial Arbitration Rules of the American
Arbitration Association then in effect. Judgment may be entered on the
arbitrator's award in any court having jurisdiction. The parties consent to the
authority of the arbitrator, if the arbitrator so determines, to award fees and
expenses (including legal fees) to the prevailing party in the arbitration.
Notwithstanding the foregoing, Company shall be entitled to enforce the
provisions of Section 5 hereof through proceedings brought in a court of
competent jurisdiction as contemplated by Section 6.8 hereof.
6.2 SEVERABILITY; REASONABLENESS OF AGREEMENT. If any term, provision or
covenant of this Agreement or part thereof, or the application thereof to any
person, place or circumstance shall be held to be invalid, unenforceable or void
by an arbitrator or court of competent jurisdiction, the remainder of this
Agreement and such term, provision or covenant shall remain in full force and
effect, and any such invalid, unenforceable or void term, provision or covenant
shall be deemed, without further action on the part of the parties hereto,
modified, amended and limited, and the arbitrator or court shall have the power
to modify, amend and limit any such term, provision or covenant, to the extent
necessary to render the same and the remainder of the Agreement valid,
enforceable and lawful. In this regard, the Executive understands that the
provisions of Section 5 may limit Executive's ability to earn a livelihood in a
business similar or related to the business of Company, but nevertheless agrees
and acknowledges that (i) the provisions of Section 5 are reasonable and
necessary for the protection of Company, and do not impose a greater restraint
than necessary to protect the goodwill or other business interest of Company,
(ii) such provisions contain reasonable limitations as to the time and the scope
of activity to be restrained, and (iii) the payment Executive is receiving
pursuant to Section 5.4 is adequate to fully compensate Executive for any lost
opportunity due to the operation of Section 5. In consideration of the foregoing
and in light of Executive's education, skills and abilities, Executive agrees
that all defenses by Executive to the strict enforcement of such provisions are
hereby waived by Executive.
6.3 KEY EMPLOYEE INSURANCE. Company in its sole discretion shall have the
right at its expense to purchase insurance on the life of Executive, in such
amounts as it shall from time to time determine, of which Company shall be the
beneficiary. Executive shall submit to such physical examinations as may
reasonably be required and shall otherwise cooperate with Company in obtaining
such insurance.
6.4 ASSIGNMENT; BENEFIT. This Agreement shall not be assignable by
Executive, other than Executive's rights to payments or benefits hereunder,
which may be transferred only by will or the laws of descent and distribution.
Upon Executive's death, this Agreement and all rights of Executive hereunder
shall inure to the benefit of and be enforceable by Executive's beneficiary or
beneficiaries, personal or legal representatives, or estate, to the extent any
such person succeeds to Executive's
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interests under this Agreement. No rights or obligations of Company under this
Agreement may be assigned or transferred except that, to the extent not
otherwise automatically provided by operation of law, Company will require any
successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of Company
to expressly assume and agree to perform this Agreement in the same manner and
to the same extent that Company would be required to perform it if no such
succession had taken place. As used in this Agreement, "Company" shall mean
Company as hereinbefore defined and any successor to its business and/or assets
(by merger, purchase or otherwise) which executes and delivers the agreement
provided for in this Section or which otherwise becomes bound by all the terms
and provisions of this Agreement by operation of law.
6.5 NOTICES. All notices hereunder shall be in writing and shall be deemed
sufficiently given (i) if hand-delivered, on the date of delivery, (ii) if sent
by documented overnight delivery service, on the first business day after
deposit with such service for overnight delivery, and (iii) if sent by
registered or certified mail, postage prepaid, return receipt requested, on the
third business day after deposit in the U.S. mail, in each case addressed as set
forth below or at such other address for either party as may be specified in a
notice given as provided herein by such party to the other. Any and all service
of process and any other notice in any such action, suit or proceeding shall be
effective against any party if given as provided in this Agreement; provided
that nothing herein shall be deemed to affect the right of any party to serve
process in any other manner permitted by law.
(a) If to Company:
Xxxxxx Interactive Inc.
000 Xxxxxxxxx Xxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Chief Financial Officer
With Copies To:
Xxxx Xxx Xxxxxxx, Esq.
Xxxxxx Beach LLP
00 Xxxxxxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
If to Executive:
Xxxxxxx Xxxxx
00 Xxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
With Copies To:
Xxxxxx Xxxxxxx, Esq.
Xxxxx Xxxxxx Xxxxxx LLP
000 Xxxxxxxxxx Xxxxxxxx
0 Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
6.6 TERMINATION PROCEDURES. Except as otherwise provided in this Agreement,
any termination of Executive's employment by the Company or by Executive during
the Term (other than termination pursuant to death) shall be communicated by
written Notice of Termination to the other party hereto. For purposes of this
Agreement, a "Notice of Termination" shall mean a notice which shall indicate
the specific termination provision in this Agreement relied upon and shall set
forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of Executive's employment under the provision so
indicated.
6.7 ENTIRE AGREEMENT; MODIFICATION; REPLACEMENT OF PRIOR AGREEMENT. This
Agreement replaces the Prior Agreement, which shall be of no further force and
effect. This Agreement constitutes the entire agreement between the parties
hereto with respect to the matters contemplated herein and supersedes all prior
agreements and understandings with respect thereto. No amendment, modification,
or waiver of this Agreement shall be effective unless in writing. Neither the
failure nor any delay on the part of any party to exercise any right, remedy,
power or privilege hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any right, remedy, power or privilege preclude any
other or further exercise of the same or of any other right, remedy, power, or
privilege with respect to such occurrence or with respect to any other
occurrence.
6.8 GOVERNING LAW. This Agreement is made pursuant to, and shall be
construed and enforced in accordance with, the laws of the State of New York and
the federal laws of the United States of America, to the extent applicable,
without giving effect to otherwise applicable principles of conflicts of law.
Subject to Section 6.1 of this Agreement, the parties hereto expressly
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consent to the jurisdiction of any state or federal court located in Monroe
County, New York, and to venue therein, and consent to the service of process in
any such action or proceeding by certified or registered mailing of the summons
and complaint therein directed to Executive or Company, as the case may be, at
its address as provided in Section 6.6 hereof.
6.9 PREVAILING PARTY. Should either party breach the terms of this
Agreement, the prevailing party who seeks to enforce the terms and conditions of
this Agreement shall be entitled to recover its attorneys fee and disbursements.
6.10 WITHHOLDING. All payments hereunder shall be subject to any required
withholding of Federal, state and local taxes pursuant to any applicable law or
regulation.
6.11 HEADINGS; COUNTERPARTS; INTERPRETATION. The headings of paragraphs in
this Agreement are for convenience only and shall not affect its interpretation.
This Agreement may be executed in two or more counterparts, each of
which shall be deemed to be an original and all of which, when taken together,
shall be deemed to constitute the same Agreement.
The Company and the Executive each acknowledge that it has been
represented by legal counsel in the negotiation and drafting of this Agreement,
that this Agreement has been drafted by mutual effort, and that no ambiguity in
this Agreement shall be construed against either party as draftsperson.
FURTHER ASSURANCES. Each of the parties hereto shall execute such
further instruments and take such other actions as the other party shall
reasonably request in order to effectuate the purposes of this Agreement.
6.12 ATTORNEYS FEES. The Company agrees to pay the reasonable
attorney's fees and disbursements incurred by Executive in the negotiation and
drafting of this Agreement.
IN WITNESS WHEREOF, THIS AGREEMENT HAS BEEN EXECUTED AND DELIVERED AS OF THE
DATE FIRST ABOVE WRITTEN.
[SIGNATURE PAGE FOLLOWS]
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XXXXXX INTERACTIVE INC.
BY: XXXXXXX X. XXXXX
-----------------------------------------
TITLE: EXECUTIVE VICE PRESIDENT, CHIEF TECHNOLOGY OFFICER
--------------------------------------------------
/S/ XXXXXXX X. XXXXX
---------------------------------
XXXXXXX X. XXXXX
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