Exhibit 10.21
EMPLOYMENT AGREEMENT
THIS AGREEMENT (this "Agreement") is being made as of the 1st
day of July, 1997 between XXXXXXX XXXX & ASSOCIATES, INC., a California
corporation (the "Company"), having its principal offices at 0000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxx, Xxxxxxxxxx 00000, and Xxx Xxxxxx ("Employee"), an individual
residing at 000 Xxxxxx Xxxxx, Xxxxxx, Xxxxxxxxxx 00000.
W I T N E S S E T H:
WHEREAS, the Company desires to continue to employ Employee
and Employee desires to be employed by the Company as its Chief Operating
Officer, upon the terms and conditions contained herein.
NOW, THEREFORE, in consideration of the mutual premises and
agreements contained herein, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Nature of Employment; Term of Employment. The Company
hereby employs Employee and Employee agrees to serve the Company as its Chief
Operating Officer, upon the terms and conditions contained herein, for a term
commencing as of the date hereof and continuing until December 31, 1999 (the
"Employment Term"); provided, that this Agreement (including this Section 1)
shall automatically be renewed for one (1) additional three (3) year period upon
terms no less favorable than the terms existing in the third year of the
Employment Term, unless the Company or Employee gives written notice to the
other party of its intention not to renew this Agreement with sixty (60) days
prior to the expiration of the Employment Term.
2. Duties and Powers as Employee. During the Employment Term,
Employee agrees to devote all of his full working time, energy, and efforts to
the business of the Company. In performance of his duties, Employee shall be
subject to the reasonable direction of the Board of Directors of the Company.
Employee shall be available to travel as the needs of the business require.
Employee agrees that the Company or MSGI may obtain a life insurance policy on
the life of Employee naming the Company or MSGI as the beneficiary thereof.
3. Compensation.
(a) As compensation for his services hereunder, the Company
shall pay Employee, a salary (a "Base Salary"), payable in equal bi-weekly
installments, at the annual rate of $175,000.00 for the first year of the
Employment Term which ends December 31, 1997; $200,000.00 for the second year of
the Employment Term and $250,000.00 for the third year of the Employment Term.
Additionally, Employee shall participate in all present or future employee
benefit and plans of the Company and MSGI, provided that he meets the
eligibility requirements therefor.
(b) Employee shall be eligible to receive bonuses each year of
the Employment Term if and as determined by the Board of Directors of the
Company; subject to the approval of the Compensation Committee of MSGI. Such
bonuses, if any, shall be based upon the achievement of earnings and other
targeted criteria. It is also contemplated that Employee will receive incentive
stock options to acquire common stock of MSGI to be determined by the Stock
Option Committee of the Board of Directors of the Company.
4. Expenses; Vacations. Employee shall be entitled to
reimbursement for reasonable travel and other out-of-pocket expenses reasonably
incurred in the performance of his duties hereunder, upon submission and
approval of written statements and bills in accordance with the then regular
procedures of the Company. Employee shall be entitled to thirty (30) days paid
vacation time in accordance with then regular procedures of the Company
governing executives as determined from time to time by the Company's Board of
Directors and communicated, in writing to Employee.
5. Representations and Warranties of Employee. Employee
represents and warrants to the Company that (a) Employee is under no contractual
or other restriction or obligation which is inconsistent with the execution of
this Agreement, the performance of his duties hereunder, or the other rights of
the Company hereunder; and (b) Employee is under no physical or mental
disability that would hinder his performance of duties under this Agreement.
6. Non-Competition.
(a) Employee agrees that during the Employment Term he will not engage
in, or otherwise directly or indirectly be employed by, or act as a
consultant, or be a director, officer, employee, owner, agent, member or
partner of, any other business or organization that is or shall then be
competing with the Company, except that in each case the provisions of this
Section 6 will not be deemed breached merely because Employee owns not more
than five percent (5.0%) of the outstanding common stock of a corporation,
if, at the time of its acquisition by Employee, such stock is listed on a
national securities exchange, is reported on NASDAQ, or is regularly traded
in the over-the-counter market by a member of a national securities
exchange.
(b) If this Agreement is terminated, Employee, for a period of three
(3) years from the date of termination, shall not, directly or indirectly,
solicit or encourage any person who was a customer of the Company during
the three years prior to the date of such termination to cease doing
business with the Company or to do business with any other enterprise that
is engaged in the same or similar business to that of the Company.
7. Inventions; Patents; Copyrights. Any interest in patents,
patent applications, inventions, copyrights, developments, and processes ("Such
Inventions") which Employee now or hereafter during the period she is employed
by the Company under this Agreement may, directly or indirectly, own or develop
relating to the fields in which the Company may then be engaged shall belong to
the Company; and forthwith upon request of the Company, Employee shall execute
all such assignments and other documents and take all such other action as the
Company may reasonably request in order to vest in the Company all of her right,
title, and interest in and to Such Inventions, free and clear of all liens,
charges, and encumbrances.
8. Confidential Information. All confidential information
which Employee may now possess, may obtain during the Employment Term, or may
create prior to the end of the period she is employed by the Company under this
Agreement, relating to the business of the Company or of any customer or
supplier of the Company shall not be published, disclosed, or made accessible by
him to any other person, firm, or corporation during the Employment Term or any
time thereafter without the prior written consent of the Company. Employee shall
return all tangible evidence of such confidential information to the Company
prior to or at the termination of his employment.
9. Termination.
(a) Notwithstanding anything herein contained, if on or after the date
hereof and prior to the end of the Employment Term, Employee is terminated
"For Cause" (as defined below) then the Company shall have the right to
give notice of termination of Employee's services hereunder as of a date to
be specified in such notice, and this Agreement shall terminate on the date
so specified. Termination "For Cause" shall mean Employee shall (i) be
convicted of a felony crime, (ii) commit any act or omit to take any action
in bad faith and to the material detriment of the Company, (iii) commit an
act of moral turpitude to the material detriment of the Company, (iv)
commit an act of fraud against the Company, or (v) materially breach any
term of this Agreement and fail to correct such breach within ten (10) days
after written notice thereof; provided that in the case of a termination
pursuant to (ii), (iii) or (iv) such determination must be made by the
Board of Directors of MSGI after a meeting at which Employee was given an
opportunity to explain such actions. In the event this Agreement is
terminated "For Cause" pursuant to Section 9(a), then Employee shall be
entitled to receive only his salary at the rate provided in Section 3 to
the date on which termination shall take effect plus any compensation which
is accrued but unpaid on the date of termination.
(b) In the event that Employee shall be physically or mentally
incapacitated or disabled or otherwise unable fully to discharge his duties
hereunder for a period of six (6) months, then this Agreement shall
terminate upon ninety (90) days' written notice to Employee, and no further
compensation (other than accrued but unpaid salary or bonus through the
date of termination) shall be payable to Employee, except as may otherwise
be provided under any disability insurance policy.
(c) In the event that Employee shall die, then this Agreement shall
terminate on the date of Employee's death, and no further compensation
(other than accrued but unpaid salary or bonus through the date of death)
shall be payable to Employee, except as may otherwise be provided under any
insurance policy or similar instrument.
(d) In the event this Agreement is terminated without Cause, Employee
shall receive severance pay consisting of a single lump sum distribution
(with no present value adjustment) equal to the Base Salary as provided in
Section 3 for a period of one (1) year, notwithstanding that such one-year
period might extend beyond the Employment Term.
10. Merger, Etc. In the event of a future disposition of the
properties and business of the Company, substantially as an entirety, by merger,
consolidation, sale of assets, sale of stock, or otherwise, then the Company may
elect to assign this Agreement and all of its rights and obligations hereunder
to the acquiring or surviving corporation. In the event the Company does not
assign this Agreement or that this Agreement is not so assumed then Employee
shall have the right to terminate this Agreement by written notice given within
six (6) months of the date of such acquisition. Upon such termination, Employee
shall receive severance pay consisting of a single lump sum distribution (with
no present value adjustment) equal to the Base Salary as provided in Section 3
for a period of one (1) year, notwithstanding that such one-year period might
extend beyond the Employment Term.
11. Survival. The covenants, agreements, representations, and
warranties contained in or made pursuant to this Agreement shall survive
Employee's termination of employment, irrespective of any investigation made by
or on behalf of any party.
12. Modification. This Agreement sets forth the entire
understanding of the parties with respect to the subject matter hereof,
supersedes all existing agreements between them concerning such subject matter,
and may be modified only by a written instrument duly executed by each party.
13. Notices. Any notice or other communication required or
permitted to be given hereunder shall be in writing and shall be mailed by
certified mail, return receipt requested, or delivered against receipt to the
party to whom it is to be given at the address of such party set forth in the
preamble to this Agreement (or to such other address as the party shall have
furnished in writing in accordance with the provisions of this Section 13). In
the case of a notice to the Company, a copy of such notice (which copy shall not
constitute notice) shall be delivered to Camhy Xxxxxxxxx & Xxxxx LLP, 0000
Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn. Xxxx X. Annex, Esq. Notice
to the estate of Employee shall be sufficient if addressed to Employee as
provided in this Section 13. Any notice or other communication given by
certified mail shall be deemed given at the time of certification thereof,
except for a notice changing a party's address which shall be deemed given at
the time of receipt thereof.
14. Waiver. Any waiver by either party of a breach of any
provision of this Agreement shall not operate as or be construed to be a waiver
of any other breach of such provision or of any breach of any other provision of
this Agreement. The failure of a party to insist upon strict adherence to any
term of this Agreement on one or more occasions shall not be considered a waiver
or deprive that party of the right thereafter to insist upon strict adherence to
that term or any other term of this Agreement. Any waiver must be in writing and
signed by the party against whose waiver is asserted.
15. Binding Effect. Employee's rights and obligations under
this Agreement shall not be transferable by assignment or otherwise, such rights
shall not be subject to encumbrance or the claims of Employee's creditors, and
any attempt to do any of the foregoing shall be void. The provisions of this
Agreement shall be binding upon and inure to the benefit of Employee and his
heirs and personal representatives, and shall be binding upon and inure to the
benefit of the Company and its successors and those who are its assigns under
Section 10.
16. Headings. The headings in this Agreement are solely for
the convenience of reference and shall be given no effect in the construction or
interpretation of this Agreement.
17. Counterparts; Governing Law. This Agreement may be
executed in any number of counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument. It shall be governed by, and construed in accordance with, the laws
of the State of New York, without given effect to the rules governing the
conflicts of laws. Each of the parties hereto agrees that such court may award
reasonable legal fees and expenses to the prevailing party.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as
of the date first written above.
XXXXXXX XXXX & ASSOCIATES, INC.
/s/ Xxxxxxx Xxxx
Xxxxxxx Xxxx
Chairman
/s/ Xxx Xxxxxx
Xxx Xxxxxx
