EXHIBIT 10.2
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement"), is made and entered into to
be effective as of December 1, 1999, by and between Lifef/x Networks, Inc. (the
"Company"), a Delaware corporation doing business in Massachusetts, and Xxxxxxx
X. Xxxxxxxxxx ("Executive"), an individual residing in Newton, Massachusetts.
The parties hereby agree as follows:
1. Employment; Term.
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(a) The Company hereby employs Executive, and Executive hereby
accepts employment with the Company, upon the terms and conditions contained in
this Agreement. The term of Executive's employment hereunder (the "Employment
Period") shall commence on December 1, 1999 (the "Effective Date") and shall
continue for a period of two (2) years from and after the Effective Date, unless
sooner terminated as hereinafter provided.
(b) The Employment Period may be extended for two (2) successive one
year periods by mutual written agreement of the parties hereto. If either party
intends not to renew this Agreement upon the expiration of the Employment Period
then in effect, such party shall give the other party notice of such intention
not less than thirty (30) days prior to the expiration of such Employment
Period. Failure to provide notice of such intention shall not constitute either
a renewal of this Agreement or an extension of the Employment Period.
2. Duties.
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(a) During the Employment Period, Executive shall serve as the
Chairman of the Board of Directors of the Company and as Co-President. Executive
shall report directly to the Board of Directors of the Company. Executive shall
faithfully perform for the Company the duties of Executive's office which shall
include such duties of an executive, technical, managerial or administrative
nature as may be specified and designated from time to time by the Board of
Directors of the Company. Subject to Section 2(b) below, Executive shall devote
substantially all of Executive's business time and effort to the performance of
Executive's duties for the Company hereunder.
(b) Notwithstanding anything to the contrary contained in Section
2(a) above, and subject to the provisions of Sections 9 and 14(a) and 14(b) and
other applicable provisions hereof, Executive shall be permitted to engage as an
officer, director, partner, stockholder, employee or as a consultant in the
management and business activities of Mirage Technologies, Inc. ("MTI"), and
which he owns in part as of the effective date hereof, and in whole as of the
date of execution hereof, and which is the general partner of Mirage
Technologies Limited Partnership ("MTP"), and in which Partnership Executive has
been a Limited Partner since 1995, and in addition in connection with
Executive's other personal investments and affairs, provided that such
activities do not, individually or
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in the aggregate, materially interfere or conflict with Executive's duties and
responsibilities to the Company, as reasonably determined by the Board of
Directors of the Company.
3. Compensation. Commencing on December 1, 1999, the Company shall pay
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to Executive a salary at an annual rate of $335,000. The salary payable pursuant
to this Section 3 (the "Base Salary") shall be payable in accordance with the
Company's payroll practices, as in effect from time to time. In addition to
Executive's Base Salary, Executive shall be entitled to annual consideration for
a bonus based on Executive's and the Company's performance, such bonus, if any,
to be as determined by the Compensation Committee as a subcommittee of the Board
of Directors, in its sole discretion.
4. Stock Option Grant. Following the execution of this Agreement and
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subject to the approval of the Board of Directors of the Company's parent
company, Lifef/x, Inc. ("Parent"), the Company will cause Parent to grant
Executive an option (the "Option") to purchase 1,952,459 shares of Parent's
Common Stock, subject to the terms and conditions of Parent's stock option plan
and agreements currently under development by Parent. Twenty percent (20%) of
the Option will vest on the Effective Date and the balance will vest in equal
quarterly installments over a period of two (2) years until fully vested. The
Option exercise price shall be $3.00 per share for 1,911,511 shares, and fair
market value for 40,948 shares. The unvested balance of stock options shall vest
immediately in the event of the Executive's death or in the event of his
Permanent Disability, as defined herein, or in the event his employment
hereunder is terminated with the effect of the Company being obligated to pay
the Severance Compensation described in Section 7(c) hereof.
5. Expenses; Benefits.
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(a) During the Employment Period, the Company agrees to reimburse
Executive, in accordance with the Company's policies as in effect and as
modified from time to time, for all reasonable and ordinary and necessary
business expenses paid or incurred by Executive in connection with the
performance of Executive's duties for the Company hereunder.
(b) During the Employment Period, Executive shall be entitled to
accrue vacation at a rate of 1.25 days per month for up to three weeks (i.e.,
fifteen days) of vacation annually, which vacation shall accrue at a rate of
1.25 days per month; provided that the maximum vacation accrual that Executive
may have at any time shall be fifteen (15) days. Once the Executive has accrued
the full fifteen (15) days vacation, all vacation accruals shall cease and shall
not resume unless and until Executive uses enough vacation time to fall below
the maximum accrual, at which point Executive shall start accruing vacation
again from that date forward until the maximum is reached again.
(c) During the Employment Period, Executive shall be entitled to
participate in and enjoy the benefits of any health, life, or disability
insurance, and of any retirement, pension, or profit-sharing plans, or other
similar plan or plans which may be instituted by the Company for the benefit of
its senior executive staff employees generally, upon such terms as may be
therein provided from time to time, and as modified or terminated from time to
time. During the initial six month period of this Agreement, the
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Executive shall be reimbursed for his reasonable expenses incurred for such
fringe benefit purposes until such time as the Company has established its own
plans and policies for such purpose. As each such plan or policy is established
by the Company in its sole discretion, this reimbursement obligation shall
terminate and be of no further legal force or effect. The failure of the
Executive to satisfy any eligibility requirements of such plans or policies,
waiting periods, or other requirements shall not increase the maximum
reimbursement obligation of the Company hereunder.
(d) During the Employment Period, the Company agrees to reimburse the
Executive, in accordance with the Company's policies as in effect from time to
time, the amount of $500 per month for automobile costs and expenses incurred by
Executive in the course of the performance of his duties hereunder.
6. Termination. Executive's employment hereunder may be terminated prior
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to the expiration of the Employment Period only as follows:
(a) Automatically in the event of the death of Executive;
(b) At the option of the Company, by written notice to Executive or
Executive's personal representative in the event of the Permanent Disability (as
defined below) of Executive. As used herein, and subject to applicable law, the
term "Permanent Disability" shall mean a physical or mental incapacity or
disability which renders Executive unable to perform the essential functions of
his position, as determined by the Company, for a period of not less than one
hundred twenty (120) days in any calendar year. In the event that the Executive
resumes the performance of substantially all of his duties hereunder before the
termination of his employment under this subparagraph becomes effective, the
notice of termination shall automatically be deemed to have been revoked. No
compensation or benefits will be paid or provided to the Executive under this
Agreement on account of termination for Permanent Disability for periods
following the date when such a termination of employment is effective. The
Executive's rights under the benefit plans of the Company shall be determined
under the provisions of those plans. At the request of the Company, Executive
will submit to a medical examination by a physician acceptable to both parties
for the purpose of permitting the Company to determine whether Executive is
unable to perform the essential functions of his position;
(c) At the option of the Company, by written notice to Executive upon
the occurrence of any one or more of the following events:
(i) any action by Executive constituting breach of fiduciary
duty, fraud, embezzlement or theft in the course of Executive's employment
hereunder;
(ii) any conviction of or guilty plea or plea of nolo contendere
by Executive involving a felony or misdemeanor involving moral turpitude, and
which offense results in material harm to the Company, as determined by the
Board of Directors of the Company in its sole and reasonable discretion;
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(iii) gross neglect or willful refusal by Executive to perform
Executive's duties hereunder for a period of ten (10) days following notice
thereof by the Company;
(iv) material failure or refusal by Executive to comply with any
valid and legal directive of the Board of Directors of the Company; or
(v) a breach by Executive of any obligation under this
Agreement if the Company determines in its sole discretion that such breach is
not curable or, if curable, is not cured within thirty (30) days after written
notice thereof by the Company to Executive.
(d) At the option of Executive, by written notice to the Company at
any time:
(i) within one hundred twenty (120) days after the occurrence
of a material breach of any material obligation under this Agreement by the
Company if such breach is not curable or, if curable, is not cured within forty-
five (45) days after written notice thereof by Executive to the Company; or
(ii) within fifteen (15) days if the Company shall have failed
to pay Executive the Base Salary on its due date in accordance with Section 3
and such failure shall not have been cured within fifteen (15) days of such
failure; or
(iii) subject to the terms and conditions of Section 4 hereof, as
the result of the Company's material failure to issue its grant of the stock
options agreed to herein; or
(iv) in the event the Executive is requested by the Company to
change the location of his regular place of employment by the Company to a
location more than forty miles distant from the City of Cambridge,
Massachusetts; or
(v) in the event the Company initiates legal proceedings
pursuant to this Agreement seeking enforcement against the Executive of the
terms and conditions of Sections 8 or 9 hereof, or
(vi) in the event Good Reason exists, such Good Reason to
include only the following two listed circumstances, and in such event the
Executive's employment with the Company may be regarded as having been
constructively terminated by the Company, and the Executive may therefore
terminate his employment for Good Reason and as a result thereof, and subject to
the terms and conditions of this Agreement, thereupon become entitled to only
the benefit of Subsection 9(e)(iv), if, before the end of his Employment Period,
one or more of the following events shall occur (unless such event(s) applies
generally to all senior management of the Company or unless the Executive shall
have become Permanently Disabled):
(1) without the Executive's written consent, the
assignment to the Executive of any duties or the reduction of the Executive's
duties, either
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of which results in a significant diminution in the Executive's position or
responsibilities with the Company in effect immediately prior to such
assignment, and which is reasonably expected to continue for a period of at
least one month, or the removal of the Executive from his position and his
active and ongoing responsibilities and duties pursuant to this Agreement; or
(2) a material reduction by the Company in the kind or
level of employee benefits to which the Executive is entitled immediately prior
to such reduction with the result that the Executive's overall employee benefits
package is significantly reduced.
(e) The Company may terminate this Agreement at any time and for any
reason or for no reason, subject to the Company's obligations under Section
7(c).
7. Effect of Termination.
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(a) In the event of the Company's termination of Executive's
employment hereunder prior to the expiration of the Employment Period for any
reason, the Company shall have no liability or obligation to Executive other
than as specifically set forth in this Section 7.
(b) Upon the termination by the Company of Executive's employment
hereunder pursuant to the provisions of Section 6(a), 6(b), or 6(c) hereof, or
the termination by Executive of Executive's employment hereunder for any reason
other than as set forth in Section 6(d), Executive (or Executive's heirs or
legal representatives) shall be entitled to receive only such portion (if any)
of the Base Salary as may theretofore have accrued but be unpaid on the date of
such termination, plus any accrued and unpaid vacation pay which may be owing
through the date of termination, plus in the event of the Executive's Permanent
Disability hereunder, the Base Salary amount payable pursuant to Section 3
hereof for the period of time until the Company's disability insurance on the
Executive becomes payable, such maximum period of time in any event not to
exceed a maximum period of twelve months from the date of such disability.
(c) Upon the termination of Executive's employment hereunder either:
(i) by the Company for any reason other than pursuant to Sections 6(a), 6(b) or
6(c), including, without limitation, pursuant to Section 6(e), or (ii) by
Executive pursuant to Section 6(d), then Executive shall be entitled to receive
such portion of the Base Salary as may theretofore have accrued but be unpaid on
the date of such termination and any accrued and unpaid vacation pay which may
be owing through the date of termination, and the Company shall continue to pay
to Executive, as severance compensation (the "Severance Compensation"),
Executive's full Base Salary as provided in Section 3 above for the unexpired
period of the term of the Employment Period set forth in Section 1(a) hereof. At
the option of the Company, the Severance Compensation shall be payable (i) at
the same time as such compensation would have been paid to Executive had
Executive not been so terminated, or (ii) in one lump sum within thirty (30)
days of the termination of Executive's employment.
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(d) Upon the termination of Executive's employment hereunder for any
reason, Executive shall immediately surrender to the Company all Company
property in the possession, custody or control of Executive, including but not
limited to any computer hardware, software, computer disks and/or data storage
devices, as well as all notes, data, sketches, drawings, manuals, documents,
records, data bases, programs, blueprints, memoranda, specifications, customer
lists, financial reports, equipment and all other physical forms of expression
incorporating or containing any Confidential Information (as defined in Section
8 hereof), it being distinctly understood that all such writings, physical forms
of expression and other things are exclusive property of the Company.
8. Confidential Information and Inventions.
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(a) Executive recognizes and acknowledges that during the course of
Executive's employment with the Company, Executive shall have access to
Confidential Information. Subject to the terms and conditions of Section 2(b)
and Section 14 hereof, "Confidential Information" means all information or
material not publicly known about the Company, including, without limitation,
any such information which relates to any of its products, services or any phase
of its operations, business or financial affairs. Confidential Information
includes, but is not limited to, the following types of information and other
information of a similar nature (whether or not reduced to writing): trade
secrets, inventions, drawings, file data, documentation, diagrams,
specifications, know-how, processes, formulas, models, flow charts, software in
various stages of development, source codes, object codes, research and
development procedures, test results, marketing techniques and materials,
marketing and development plans, price lists, pricing policies, business plans,
information relating to customers and/or suppliers' identities, characteristics
and agreements, financial information and projections and employee files
Confidential Information also includes any information described above which the
Company obtains from another party and which the Company treats and/or has an
obligation to treat as confidential or designates as Confidential Information,
whether or not owned or developed by the Company. Confidential Information shall
not include any information which is or becomes (i) generally available to the
public other than as a result of disclosure in violation of any agreement with
the Company or (ii) generally known in the industry in which the Company is or
may become involved other than as a result of disclosure in violation of any
agreement with the Company. (The term "Company," as used in this Section 8,
means not only Lifef/x Networks, Inc., but also any company, partnership or
entity which, directly or indirectly, controls, is controlled by or is under
common control with Lifef/x Networks, Inc.)
(b) Subject to the terms and conditions of Section 2(b) and Section
14 hereof, both during the Employment Period and at all times thereafter, all
Confidential Information which Executive may now possess, may obtain during or
after the Employment Period, or may create prior to the end of the Employment
Period will be held confidential by Executive, and Executive will not (nor will
Executive assist any other person to do so), directly or indirectly, (i) reveal,
report, publish or disclose such Confidential Information to any person, firm,
corporation, association or other entity for any reason or purpose whatsoever
(other than in the course of carrying out Executive's duties hereunder or as
expressly authorized by the Company), (ii) render any services to
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any person, firm, corporation, association or other entity to whom any such
Confidential Information, in whole or in part, has been disclosed or is
threatened to be disclosed by or at the instance of Executive, or (iii) use such
Confidential Information except for the benefit of the Company and in the course
of Executive's employment with the Company; provided, however that the foregoing
will not apply to the extent Executive is required to disclose any Confidential
Information by applicable law or legal process so long as Executive promptly
notifies the Company of such pending disclosure and consults with the Company
prior to such disclosure concerning the advisability of seeking a protective
order or other means of preserving the confidentiality of the Confidential
Information.
(c) Subject to the terms and conditions of Section 2(b) and Section
14 hereof, any Inventions (as defined below) in whole or in part conceived, made
or reduced to practice by Executive (either solely or in conjunction with
others) during or after the Employment Period which are made through the use of
any of the Confidential Information or any of the Company's equipment,
facilities, supplies, trade secrets or time, or which relate to the Company's
business or the Company's actual of demonstrably anticipated research and
development, or which result from any work performed by Executive for the
Company will belong exclusively to the Company and will be deemed part of the
Confidential Information for purposes of this Agreement, whether or not fixed in
a tangible medium of expression. The term "Inventions," as used herein, means
any ideas, designs, concepts, techniques, inventions and discoveries, whether or
not patentable or protectable by copyright and whether or not reduced to
practice, including, but not limited to, devices, processes, drawings, works of
authorship, computer programs, software, source codes, object codes, interfaces
and networks (and all components of the foregoing), methods and formulas
together with any improvements thereon or thereto, derivative works therefrom
and know-how related thereto.
(i) Without limiting the foregoing, any such Inventions will be
deemed to be "works made for hire" and the Company will be deemed to be the
owner thereof, provided that in the event and to the extent such works are
determined not to constitute "works made for hire" as a matter of law, Executive
hereby irrevocably assigns and transfers to the Company all right, title and
interest in and to any such Inventions, including but not limited to all related
patents, copyrights and mask works and all applications therefor and filings and
notification with respect thereto.
(ii) Executive acknowledges and agrees that he will keep and
maintain adequate and current written records (in the form of notes, sketches,
drawings or such other form(s) as may be specified by the Company) of all
Inventions made by Executive during the Employment Period or thereafter
(including but not limited to information relating to all Inventions which
belong exclusively to the Company pursuant to the provisions of this Section
8(c)), which records will be available at all times to the Company and will
remain the sole property of the Company. In the event that (A) any Invention is
made, conceived of or reduced to practice by Executive, either solely or in
conjunction with others, during the Employment Period, or (B) any Invention is
made, conceived of or reduced to practice by Executive after the Employment
Period which belongs exclusively to the Company pursuant to the provisions of
this Section 8(c),
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Executive will promptly give notice and fully disclose in writing such Invention
to the Chairman of the Board and the Board of Directors of the Company.
(iii) Executive will assist the Company (at the Company's
expense), either during or subsequent to the Employment Period, to obtain and
enforce for the Company's benefit, patents, copyrights, and mask work protection
in any country for any and all Inventions made by Executive, in whole or in
part, the rights to which belong to or have been assigned to the Company
pursuant to the provisions of Section 8(c) hereof. Executive will be compensated
for such assistance at a reasonable rate not to exceed $800 per day for time
accounted for and actually employed in such assistance. Executive agrees to
execute all applications, assignments, instruments and papers and perform all
acts as the Company or its counsel may deem necessary or desirable to obtain any
patents, copyrights or mask work protection in such Inventions and otherwise to
protect the interests of the Company therein. In the event the Company is unable
to secure Executive's signature on any document necessary to apply for,
prosecute, obtain, or enforce any patent, copyright, or other right or
protection relating to any Invention, whether due to mental or physical
incapacity or any other cause, Executive hereby irrevocably designates and
appoints the Company and each of its duly authorized officers and agents as
Executive's agents and attorney-in- fact, to act for and in Executive's behalf
and stead to execute and file any such document and to do all other lawfully
permitted acts to further the prosecution, issuance, and enforcement of patents,
copyrights, or other right or protections with the same force and effect as if
executed and delivered by Executive.
(d) Subject to the terms and conditions of Section 2(b) and Section
14 hereof, all memoranda, notes, lists, records and other documents (and all
copies thereof) constituting Confidential Information (including information
relating to all Inventions which belong exclusively to the Company pursuant to
the provisions of Section 8(c) above) made or compiled by Executive or made
available to Executive during or after the Employment Period shall be the
Company's property, shall be kept confidential in accordance with the provisions
of this Section 8 and shall be delivered to the Company at any time on request
and in any event upon the termination of Executive's employment with the Company
for any reason.
9. Covenant Against Competition. Executive covenants and agrees that:
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(a) During the Non-Compete Period (as hereinafter defined), Executive
shall not, directly or indirectly, in any Geographic Area (as hereinafter
defined): (i) engage for Executive's own account in any business competitive
with the Company Business (as hereinafter defined); (ii) render any services in
any capacity to any person or entity (other than the Company or its Affiliates)
engaged in any business competitive with the Company Business; or (iii) acquire
an interest in any person or entity engaged in any business competitive with the
Company Business (other than the Company) as a partner, shareholder, director,
officer, employee, principal, manager, member, agent, trustee, consultant or in
any other relationship or capacity; provided, however, Executive may own,
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directly or indirectly, solely as a passive investment, securities of any such
entity which are traded on any national securities exchange if Executive (A) is
not a controlling person of,
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or a member of a group which controls, such entity, and (B) does not, directly
or indirectly, own 1% or more of any class of securities of such entity.
(b) During the Non-Compete Period, Executive shall not, without the
prior written consent of the Company, directly or indirectly, on behalf of
himself or any other person or entity solicit or encourage any employee of the
Company or any of its Affiliates to leave the employment of the Company or any
of its Affiliates, or hire any employee who has left the employment of the
Company or any of its Affiliates within one year of the termination of such
employee's employment with the Company or any of its Affiliates.
(c) During any portion of the Non-Compete Period during which
Executive is not employed by the Company, Executive shall not, in any Geographic
Area, and in connection with any business competitive with the Company's
Business (as hereinafter defined), directly or indirectly, (i) solicit or
encourage any customer or client of the Company to engage the services of
Executive or any person or entity (other than the Company) in which Executive is
a partner, shareholder, director, officer, employee, principal, member, manager,
agent, trustee, consultant or engaged in any other relationship or capacity, or
(ii) accept orders or business from, or agree to provide services to, any
customer or client of the Company, on behalf of Executive or any person or
entity (other than the Company) in which Executive is a partner, shareholder,
director, officer, employee, principal, member, manager, agent, trustee,
consultant or engaged in any other relationship or capacity.
(d) If any provision of Sections 8 or 9 is held to be unenforceable
because of the scope, duration, area of its applicability or otherwise, it is
the intention of the parties that the court making such determination shall
modify such scope, duration or area, or all of them so that the provision shall
be enforceable to the greatest extent permitted under the law, and that such
provision shall then be applicable in such modified form.
(e) As used in this Agreement:
(i) "Affiliate" shall mean any entity directly or indirectly
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controlling, controlled by, or under common control with the Company and any
entity in which the Company is a general partner, member, manager or holder of
greater than a 10% common equity, partnership or membership interest.
(ii) "Company Business" shall mean the business of the Company
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as so defined at the time of the signing of this Agreement, or at the time of a
violation of this Section 9 is alleged to occur or, if such alleged occurrence
is after Executive's employment is terminated, the business of the Company at
the time such employment terminates.
(iii) "Geographic Area" shall mean the world.
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(iv) "Non-Compete Period" shall mean the period during which
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Executive is employed by the Company and for an additional period of two years
following
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the termination of Executive's employment with the Company. Such two year period
following Executive's termination of employment shall be reduced to a one year
period in the event the Executive's termination of employment by the Company
occurs for no specific reason or in the event Executive terminates his
employment with the Company for Good Reason, as defined in Section 6(d)(vi)
hereof.
(v) "Control" with respect to any person, shall mean
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possession, direct or indirect, of the power to direct or cause the direction of
the management and policies of such person, whether through the ownership of
voting securities or a partnership interest, by contract or otherwise, and for
example, including election of a majority of a board of directors of persons who
simultaneously serve on another affiliated board of directors.
10. Enforcement by Injunction. Executive acknowledges and agrees that the
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Company will be irreparably damaged if Executive fails to comply with the
provisions of Sections 8 or 9 hereof, subject to the applicable terms and
conditions of this Agreement, including Section 2(b) and Section 14 hereof.
Accordingly, in the event of such a failure to comply with the terms and
conditions of Sections 8 or 9 hereof, the Company shall be entitled to (i) an
injunction or any other appropriate decree of specific performance (without the
necessity of posting any bond or other security in connection therewith) in case
of any breach or threatened breach of Executive's covenants under Sections 8 or
9, (ii) damages in an amount equal to all compensation, profits, monies,
accruals, increments or other benefits derived or received by Executive (or any
associated party deriving such benefits including but not limited to any future
employer of Executive) as a result of any such breach of Executive's covenants
under Sections 8 or 9, and (iii) indemnification against any other losses,
damages, costs and expenses, including actual attorneys' fees and court costs,
incurred by the Company in obtaining any damages and/or injunctive relief Such
remedies shall not be exclusive and shall be in addition to any other remedy, at
law or in equity, which the Company may have for any breach or threatened breach
of Sections 8 or 9 by Executive.
11. Notices. Any and all notices or other communications required or
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permitted to be given under any of the provisions of this Agreement shall be in
writing and shall be deemed to have been duly given when personally delivered or
mailed by first class registered mail, return receipt requested, or by
commercial courier or delivery service, or by facsimile, addressed to the
parties at the addresses set forth below their signatures hereto (or at such
other address as any party may specify by notice to all other parties given as
aforesaid).
12. Indemnification. The Company shall indemnify Executive and hold
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Executive harmless from and against any and all losses, claims, damages or
liabilities (including reasonable attorneys' fees), and all actions, claims or
proceedings in respect thereof, brought against Executive by any third party by
reason of the fact that Executive is or was a director, officer or employee of
the Company or any other business or entity for which Executive so serves at the
written request of the Company, if Executive acted, in good faith, for a purpose
which Executive reasonably believed to be in, or (in the case of service for
such other business or entity) not opposed to, the best interests of the Company
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and, in criminal proceedings, in addition, had no reasonable cause to believe
that Executive's conduct was unlawful; provided that the Company shall not be
liable under this Section 12 to the extent that any loss, claim, damage,
liability or expense: is found by a court of competent jurisdiction to arise (i)
from the gross negligence or willful misconduct of Executive or (ii) out of or
relate to Executive's acts or omissions, negligent or otherwise, relating to any
of the outside business and investment activities of Executive described in
Section 2(b) above. In connection with the indemnity granted by the Company,
Executive agrees (i) to notify the Company promptly of the assertion against
Executive of any claims or the commencement of any action or proceeding for
which Executive may seek indemnity under this Agreement (provided that the
failure to so notify the Company shall not affect the Company's obligations
hereunder, except to the extent the Company is materially prejudiced by such
failure); and (ii) reasonably to cooperate with the Company and counsel selected
by the Company to represent Executive (which counsel shall be reasonably
acceptable to Executive). Expenses (including reasonable attorneys' fees and
disbursements) Executive incurs in defending any action, suit or proceeding
shall be paid by the Company from time to time promptly upon Executive's written
request in advance of the final disposition of the action, suit or proceeding
upon presentation of vouchers or other evidence of the incurrence of the expense
and upon receipt of an undertaking in writing by Executive to repay such amount
if it shall ultimately be determined that Executive is not entitled to be
indemnified thereunder.
13. Arbitration. Any dispute or controversy arising under this Agreement
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or concerning Executive's employment with the Company (including, without
limitation, any controversy as to the arbitrability of any dispute) including
but not limited to any claims arising out of Title VII of the Civil Rights Act
of 1964, the Age Discrimination in Employment Act, the Americans with
Disabilities Act, and/or Massachusetts General Laws Chapter 151B, shall be
settled exclusively by arbitration to be held in Boston, Massachusetts, before a
single arbitrator in accordance with the rules of the American Arbitration
Association then in effect relating to the arbitration of employment disputes,
provided, however, that any claims arising out of Sections 8, 9 and/or 10 of
this Agreement shall be resolved through the courts. Judgment may be entered on
the arbitrator's award in any court having jurisdiction, and the parties consent
to the jurisdiction of the Massachusetts courts for that purpose.
14. Exclusions from Sections 8 and 9: Effect on Sections 2(a) and 2(b).
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(a) Notwithstanding anything contained in Section 8 or Section 9
hereof to the contrary, the activities of Mirage Technologies Limited
Partnership and of its general partner, Mirage Technologies, Inc., and of the
Executive in connection therewith, shall not be deemed to be competitive with
the Company Business to the extent such activities are (1) based on prior
activities or intellectual properties owned by such two entities as of the date
this Agreement is signed, and including therein, but without limitation by
reference thereto, the Intellectual Property known generally as Mirada and
concerning which a patent was recently issued by the U.S. Patent and Trademark
Office, or (2) not included within the Lifef/x internet technology related
business plan of this Company, as such business plan is adopted in writing by
the Board of Directors of this Company either before or within ninety (90) days
after the date this Agreement is actually signed, and as it may be
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amended annually thereafter. In the event the Board of Directors of this Company
fails for any reason or for no reason to adopt such a business plan, such
Lifef/x business plan shall be deemed to be that plan set forth and described in
the Company's Private Placement Memorandum dated October 29, 1999, as previously
amended. In the event the Board of Directors fails to amend the business plan
for any reason or for no reason at the end of the first calendar year, the
business plan shall be that plan previously adopted pursuant to this Agreement's
terms and conditions.
(b) Subject to the terms and conditions of Sections 2(a) and 2(b)
hereof, and Section 14(a) hereof, and other applicable provisions hereof, the
Executive's personal activities and personal services in connection with MTP and
its general partner, MTI, and any other activities or personal services
performed in connection with any company or entity owned in whole or in part by,
controlled by, incubated by, started, spin off, spun out or otherwise related to
MTI and/or MTP, shall not be deemed to be competitive with the Company's
Business in and of themselves, and such limited permitted activities shall not
by themselves alone be deemed by the Company to be a failure by the Executive to
comply with or to constitute the breach by the Executive of this Agreement or in
particular the provisions of Section 2 hereof so long as such activities by
Executive do not interfere with Executive's availability to the Company
hereunder, and his performance of his full-time duties hereunder.
15. Miscellaneous.
-------------
(a) This writing constitutes the entire agreement of the parties with
respect to the subject matter hereof and may not be modified, amended or
terminated except by a written agreement signed by all of the parties hereto.
(b) This Agreement shall not be assignable by Executive, but it shall
be binding upon, and shall inure to the benefit of, Executive's heirs,
executors, administrators and legal representatives. This Agreement may be
assigned by the Company to any Affiliate of the Company or any successor to all
or substantially all of the Company's Lifef/x technology and shall be binding
upon and inure to the benefit of the Company and its successors and assigns.
(c) No waiver of any breach or default hereunder shall be considered
valid unless in writing, and no such waiver shall be deemed a waiver of any
subsequent breach or default of the same or similar nature.
(d) If any provision of this Agreement shall be held invalid or
unenforceable, such invalidity or unenforceability shall attach only to such
provision and shall not in any manner affect or render invalid or unenforceable
any other severable provision of this Agreement, and this Agreement shall be
carried out as if any such invalid or unenforceable provision were not contained
herein, unless the invalidity or unenforceability of such provision
substantially impairs the benefits of the remaining portions of this Agreement.
(e) The section headings contained herein are for the purposes of
convenience only and are not intended to define or limit the contents of said
sections.
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(f) This Agreement may be executed in two or more counterparts, all
of which taken together shall be deemed one original.
(g) This Agreement shall be deemed to be a contract under the laws of
the Commonwealth of Massachusetts and for all purposes shall be construed and
enforced in accordance with the internal laws of said Commonwealth.
(h) This Agreement shall not confer any rights or remedies upon any
person or entity other than the parties hereto and their respective successors
and permitted assigns.
(i) The Executive acknowledges that he has consulted with counsel and
is fully aware of his rights and obligations under this Agreement.
(j) The Executive represents and warrants that his employment by the
Company as described herein shall not conflict with and will not be constrained
by any prior employment or consulting agreement or other business or investment
relationship, and that he has previously satisfied all requirements of
applicable law to be employed by the Company.
(k) During his Employment Period, the Company agrees to use its
reasonable best efforts to obtain and to pay for Directors and Officers
Liability insurance from a solvent insurer in amounts and on terms which the
Company in its sole discretion may establish from time to time, and to provide
evidence of such insurance to the Executive once in each calendar year if
requested in writing by the Executive to do so.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first above written.
Lifef/x Networks, Inc.
/s/ Xxxxxxx Xxxxxxxxxx By: /s/ Xxxxxxx Xxxxxxx
----------------------------- ------------------------------
Xxxxxxx Xxxxxxxxxx Name: Xxxxxxx X. Xxxxxxx
----------------------------
Address: Title: CEO
000 Xxxxxx Xxxx ---------------------------
Name and Address:
Xxxxxxx X. Xxxxxxx, CEO and Co-President
Lifef/x, Inc.
c/o Cambridge Technology Partners
0 Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
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