EXHIBIT 10.18
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made as of the 1st day of April, 1996, by
and between VALUE AMERICA, INC., a Nevada corporation (the "Company"), and
Xxxxxx X. Page (the "Executive").
In consideration of the mutual convenants contained herein, the Company
and the Executive agree as follows:
1. Employment. The Company agrees to employ the Executive and the
Executive agrees to continue in the employ of the Company on the terms and
conditions hereinafter set forth.
2. Capacity. The Executive shall serve the Company in such positions or
offices with such authority, titles and duties as may be prescribed from time to
time by the President, Chief Executive Officer or Board of Directors (the
"Board") of the Company, and shall serve the Company in such other or additional
offices in which he may be requested to serve from time to time.
3. Effective Date and Term. The commencement date of this Agreement
shall be April 1, 1996 (the "Commencement Date"). Subject to the provisions
Section 6, the term of the Executive's employment hereunder shall be for two
years from the Commencement Date; provided, however, that the term shall be
extended automatically for an additional period of one year commencing on the
second anniversary of the Commencement Date and on each subsequent anniversary
thereafter, unless either the Executive or the Company gives written notice to
the other, at least thirty (30) days prior to the date of any such anniversary,
of such party's election not to extend the term of this Agreement. The last day
of such term, as so extended from time to time, is herein sometimes referred to
as the "Expiration Date."
4. Compensation and Benefits. The regular compensation and benefits
payable to the Executive under this Agreement shall be as follows:
(a) Salary. For all services rendered by the Executive under this
Agreement, the Company shall pay the Executive a total salary at the rate
agreed to from time to time through September 30, 1997; at the rate of $85,000
per year effective October 1, 1997 through December 31, 1997; and at the rate of
$100,000 per year beginning January 1, 1998, subject to increase or decrease at
any time and, from time to time, in sole discretion of the Company.
(b) Bonus. The Executive shall also be eligible to receive a cash
bonus on each of the dates specified below (each a "Bonus Date") in the amount
("Bonus Amount") specified next to the corresponding Bonus Date, provided that
(i) the Executive continues to be employed by the Company on the specified Bonus
Date and (ii) the Executive shall have previously exercised (by providing any
required notice and paying the exercise price) in full all options ("Vested
Options") to purchase shares of the Company's common stock then held by the
Executive and which shall have become subject to exercise pursuant to any
Incentive Stock Option Agreement between the Executive and the Company. In the
event the Executive shall not have, as of any specified Bonus Date on which he
continues to be employed by the Company, previously exercised all Vested
Options, the specified Bonus amount shall be paid to the Executive upon the
Executive's complete exercise of all such Vested Options. In the event the
Executive's employment with the Company is terminated for any reason (including
without limitation by the Employee or by the Company, with or without Cause)
prior to any specified Bonus Date, the Company shall be under no further
obligation to pay any Bonus Amount to the Executive, other than the Bonus Amount
to which he would otherwise have been eligible on the Bonus Date immediately
Following the date of termination of his employment (the "Missed Bonus Date")
had his employment not been terminated (and provided all Vested Options shall
have been completely exercised to the extent permitted by their terms prior to
the Missed Bonus Date), which Bonus Amount shall be paid upon the Employee's
complete exercise of all Vested Options in accordance with their terms; provided
further, however, that the Company shall be under no obligation to pay such
Bonus Amount to which the Executive would otherwise have been eligible in the
event the Executive's employment is terminated by the
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Executive pursuant to Section 6(c) below or by the Company with Cause pursuant
to Section 6(b) below.
Bonus Date Bonus Amount
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April 1, 1997 $66,562.50
December 31, 1997 $19,150.50
January 15, 1998 $85,713.00
January 1, 1999 $85,713.00
January 1, 2000 $85,713.00
January 1, 2001 $63,213.00
April 1, 2001 $22,500.00
January 1, 2002 $ 3,622.50
(c) Regular Benefits. The Executive shall also be entitled to
participate in any employee benefit plans, medical insurance plans, life
insurance plans, disability income plans, retirement plans, bonus incentive
plans and other benefit plans from time to time in effect for all employees of
the Company. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company and
(iii) the discretion of the Board or any administrative or other committee
provided for in or contemplated by such plan.
(d) Business Expenses. The Company shall reimburse the Executive for all
reasonable travel and other business expenses incurred by him in the performance
of his duties and responsibilities, subject to such requirements with respect to
substantiation and documentation as may be specified by the Company.
(e) Vacation. The Executive shall be entitled to such number of weeks of
vacation per year as shall be provided for in Company's employee handbooks as
the same shall be modified from time to time, to be taken at such times and
intervals as shall be determined by the Executive with the approval of the
Company.
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(f) Other Incentives. The Company may, but shall not be obligated to,
provide the Executive with such other performanced-based compensation, benefits
or incentives as shall be established, amended or thereafter terminated from
time to time by and in the sole discretion of the Board or the compensation
committee thereof, and in considering any such compensation, benefits or
incentives, the Board or such committee may consider such factors as the
Executive's performance, productivity and contribution to the Company's
profitability.
5. Extent of Service. During his employment hereunder, the Executive
shall, subject to the direction and supervision of the President, Chief
Executive Officer and Board, devote his full business time, best efforts and
business judgment, skill and knowledge to the advancement of the Company's
interests and to the discharge of his duties and responsibilities hereunder. The
Executive shall not engage in any other business activity, except as may be
approved by the President, Chief Executive Officer or Board of the Company;
provided, however, that nothing herein shall be construed as preventing the
Executive from:
(a) investing his assets in a manner not prohibited by Section 8(a)
hereof, and in such form or manner as shall not require any material services on
his part in the operations or affairs of the companies or other entities in
which such investments are made;
(b) serving on the board of directors of any company, subject to the
prohibitions set forth in Section 8(a) and provided that he shall not be
required to render any material services with respect to the operations or
affairs of any such company; or
(c) engaging in religious, charitable or other community or non-profit
activities which do not impair his ability to fulfill his duties and
responsibilities under this Agreement.
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6. Termination.
Notwithstanding the provisions of Section 3, the Executive's employment
hereunder shall terminate under the following circumstances and shall be subject
to the following provisions:
(a) Death. In the event of the Executive's death during the
Executive's employment hereunder, the Executive's employment shall terminate on
the date of his death and the Executive or his estate shall be entitled to no
further compensation or benefits under this Agreement; provided, however, that
the Company shall continue to pay an amount equal to the Executive's salary
(not including any bonus other than any Bonus Amount payable under Section
4(b)hereof) to the Executive's beneficiary designated in writing to the Company
prior to his death (or to his estate, if he fails to make such designation)
for a period of one month after the date of the Executive's death, at the
salary rate in effect on the date of his death, said payments to be made on the
same periodic dates as salary payments would have been made to the Executive
had he not died.
(b) Termination by the Company for Cause. The Executive's
employment hereunder may be terminated without further liability on the part of
the Company effective immediately by the Company (acting through its President,
Chief Executive Officer or Board), for Cause by written notice to the
Executive setting forth in reasonable detail the nature of such Cause. Upon
termination of employment by the Company for Cause, the Executive shall be
entitled to no further compensation or benefits under this Agreement. Only
the following shall constitute "Cause" for such termination:
(i) gross incompetence, gross negligence, willful misconduct
in office or breach of a material fiduciary duty owed to the Company, or any
subsidiary or affiliate thereof;
(ii) conviction of a felony, a crime of moral turpitude or
commission of an act of embezzlement or fraud against the Company, or any
subsidiary or affiliate thereof;
(iii) any material breach by the Executive of a material term
of this Agreement or any other agreement between the Executive and the Company,
including without limitation material failure to perform a substantial
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portion of his duties and responsibilities hereunder; continued failure, after
reasonable notice from the Company, to adhere to or satisfy any production,
performance or other standards established by the Company and communicated to
the Executive; or unauthorized use or disclosure of Confidential Information
or trade secrets of the Company; or
(iv) dishonesty or fraud of the Executive with respect to the
Company, or any subsidiary or affiliate thereof.
(c) Termination by the Executive. The Executive may terminate his
employment hereunder by written notice to the President, Chief Executive Officer
or Board effective thirty (30) days after receipt of such notice. Upon termina-
tion of employment by the Executive, the Executive shall be entitled to no
further compensation or benefits under this Agreement.
(d) Termination by the Company Without Cause. The Executive's
employment with the Company may be terminated without Cause by the Company
(acting through its President, Chief Executive Officer or Board), effective
immediately by written notice to the Executive. Upon termination of employment
by the Company without Cause, the Company shall pay to the Executive within
fifteen (15) days after the date of termination cash in the amount of (i) any
unpaid salary due to the Executive hereunder through the date of the
termination, plus (ii) any accrued but unpaid vacation pay due to the Executive.
(e) Officer's Severance Benefit. In the event the Executive is an
officer of the Company on the date of the termination of the Executive's
employment and has completed at least ninety (90) days of continuous employment
with the Company, the Company shall pay to the Executive thirty (30) days
additional salary at the same rate paid to the Executive prior to such
termination. If the Executive qualifies for the severance benefit under the
previous sentence, and in the event the Company does not waive with respect to
the Executive the provisions of Section 3.1 of the Developments, Noncompete and
Nondisclosure Agreement referenced in Section 8 below, the Company also shall
pay the Executive salary for a period of six (6) additional months at the same
rate paid to the Executive prior to termination. This Section 6(e) is expressly
made subject to Section 6(f) below.
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(f) No Termination Benefits. In the event of any termination of the
Executive's employment hereunder for any reason (including without limitation
pursuant to Sections 3, 6(a), 6(b), 6(c), or 6(d) or Section 7 hereof), the
Executive shall not be entitled to any salary, bonus, severance pay or benefits
not otherwise specified herein.
(g) Litigation and Regulatory Cooperation. The Executive shall
reasonably cooperate with the Company in the defense or prosecution of any
claims or actions now in existence or which may be brought in the future
against or on behalf of the Company, which relate to events or occurrences that
transpired while the Executive was employed by the Company. The Executive's
reasonable cooperation in connection with such claims or actions shall include,
but not be limited to, being reasonably available to meet with counsel to
prepare for discovery or trial and to act as a witness on behalf of the Company,
at mutually convenient times and locations. The Executive shall also reasonably
cooperate with the Company in connection with any examination or review of any
federal or state regulatory authority as any such examination or review relates
to events or occurrences that transpired while the Executive was employed by the
Company. If such cooperation is required after the Executive ceases to be
employed by the Company, the Company shall pay the Executive for such
cooperation a fee of twenty five dollars ($25.00) per hour, payable monthly in
arrears, and will reimburse the Executive for any reasonable out-of-pocket
expenses incurred in connection therewith.
7. Disability. If, due to physical or mental illness, the Executive
shall be disabled so as to be unable to perform substantially all of his duties
and responsibilities hereunder, which disability lasts for an uninterrupted
period of at least sixty (60) days or a total of at least one hundred eighty
(180) days in any calendar year (as determined by the opinion of an independent
physician selected by the Company), the Company may designate another executive
to act in his place during the period of such disability. Notwithstanding any
such designation, the Executive shall continue to receive his full salary and
benefits under Section 4 of this Agreement until he becomes eligible for
disability income under the Company's disability income plan, if any, or in the
absence of a disability income plan, until the Expiration Date.
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8. Developments, Noncompete and Confidential Information. Simultaneous
with his execution of this Agreement, and as a material part of the
consideration for the Company's entering into this Agreement, the Executive
agrees to execute, comply with the terms of and become bound by a Developments,
Noncompete and Nondisclosure Agreement with the Company in the form of Exhibit
A attached hereto, the terms of which (a) are incorporated into this Agreement
in their entirety, (b) are deemed for all purposes to be a part of this
Agreement, and (c) shall survive any termination of this Agreement.
9. Conflicting Agreements. The Executive hereby represents and warrants
that the execution of this Agreement and the performance of his obligations
hereunder will not breach or be in conflict with any other agreement to which he
is a party or by which he is bound, and that he is not subject to any covenants
against competition or similar covenants which would affect the performance of
his obligations hereunder.
10. Withholding. All payments made by the Company under this Agreement
shall be net of any tax or other amounts required to be withheld by the Company
under applicable law.
11. Arbitration of Disputes. Any controversy or claim arising out of or
relating to the employment relationship between the Executive and the Company
shall be settled by arbitration in accordance with the laws of the Commonwealth
of Virginia by three arbitrators, one of whom shall be appointed by the Company,
one by the Executive and the third by the first two arbitrators. If the first
two arbitrators cannot agree on the appointment of a third arbitrator, then the
third arbitrator shall be appointed by the American Arbitration Association in
the City of Richmond. Such arbitration shall be conducted in the City of
Richmond in accordance with the rules of the American Arbitration Association,
except with respect to the selection of arbitrators which shall be as provided
in this Section 11. Judgment upon the award rendered by the arbitrators may be
entered in any court having jurisdiction thereof. The party or parties against
whom the arbitrators shall render an award shall pay the other party's or
parties' reasonable attorneys' fees and other reasonable costs and expenses in
connection with the enforcement of its or their rights under this Agreement
(including the enforcement of any arbitration
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award in court), unless and to the extent the arbitrators shall determine that
under the circumstances recovery by the prevailing party or parties of all or a
part of any such fees and costs and expenses would be unjust.
12. Assignment; Successors and Assigns, etc. Neither the Company nor the
Executive may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party or parties; provided, however, that the Company may assign its rights
under this Agreement without the consent of the Executive in the event that the
Company shall hereafter effect a reorganization, consolidation with or merges
into any other Person, or transfer all or substantially all of its properties or
assets to any other Person. This Agreement shall inure to the benefit of and be
binding upon the Company and the Executive, their respective successors,
subsidiaries, affiliates, executors, administrators, heirs and permitted
assigns. In the event of the Executive's death prior to the completion by the
Company of all payments due him under this Agreement, the Company shall continue
such payments to the Executive's beneficiary designated in writing to the
Company prior to his death (or to his estate, if he fails to make such
designation).
13. Enforceability. If any portion or provision of this Agreement shall
to any extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Agreement, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.
14. Waiver. No waiver of any provision hereof shall be effective unless
made in writing and signed by the waiving party or parties. The failure of any
party to require the performance of any term or obligation of this Agreement, or
the waiver by any party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.
15. Notices. Any notices, request, demands and other communications
provided for by this Agreement shall be sufficient if in writing and delivered
in
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person or sent by registered or certified mail, postage prepaid (in which
case notice shall be deemed to have been given on the third day after mailing),
or by overnight delivery by a reliable overnight courier service (in which case
notice shall be deemed to have been given on the day after delivery to such
courier service) to the Executive at the last address the Executive has filed in
writing with the Company or, in the case of the Company, at its main offices,
attention of its President or Chief Executive Officer.
16. Amendment. This Agreement may be amended or modified only by a
written instrument signed by the Executive and by a duly authorized
representative of the Company.
17. Governing Law. This is a Virginia contract and shall be construed
under and be governed in all respects by the laws of the Commonwealth of
Virginia.
18. Entire Agreement. This Agreement, the Developments, Noncompete and
Nondisclosure Agreement referred to in Section 8, and any Incentive Stock Option
Agreement entered into by the Company and the Executive constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all prior or contemporaneous written or oral agreements or
understandings with respect to the subject matter hereof.
19. Legal Counsel. Executive has reviewed the contents of this Agreement
and fully understands its terms. Executive acknowledges that he is fully aware
of his right to the advice of counsel independent from that of the Company, that
the Company has advised him of such right and disclosed to him the risks in not
seeking such independent advice, and that he understands the potentially adverse
interests of the parties with respect to this Agreement. Executive further
acknowledges that no representations have been made with respect to the income
or estate tax or other consequences of this Agreement to him and that he has
been advised of the importance of seeking independent advice of counsel with
respect to such consequences.
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IN WITNESS WHEREOF, this Agreement has been executed as a sealed
instrument by the Company, and by the Executive, and is effective as of the date
first above written.
VALUE AMERICA,INC.
By: /s/ Xxx Xxxxxxx
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Title: President
Date: 4-1-96
/s/ Xxxxxx Page
------------------
Executive
Date: 4-1-96
Address:
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