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EXHIBIT 10.4
EMPLOYMENT AGREEMENT
DATED AS OF SEPTEMBER 24, 1997
BY AND BETWEEN
XXXX DIGITAL TECHNOLOGIES, INC.,
A DELAWARE CORPORATION (THE "COMPANY"),
AND
XXXXXXX XXXXX (THE "EXECUTIVE").
------------------------
The parties hereto desire to provide for the Executive's continued
employment by the Company in accordance with the terms and provisions set forth
below:
NOW, THEREFORE, the parties agree as follows:
1. Employment; Term.
The Company will employ the Executive, and the Executive will work for the
Company, as its Executive Vice President -- Business Development, for a term
commencing on the date hereof and terminating on December 31, 2002 unless sooner
terminated in accordance with Section 7 hereof. Such period, together with the
period of any extension or renewal of such employment, is referred to herein as
the "Employment Period."
2. Duties.
During the Employment Period, the Executive shall serve as the Executive
Vice President -- Business Development of the Company, and perform such further
duties as shall, from time to time, be reasonably assigned to the Executive by
the Chief Executive Officer of the Company consistent with his position and
abilities.
3. Devotion of Time.
During the Employment Period, the Executive shall: (i) expend substantially
all of his working time for the Company; (ii) devote his best efforts, energy
and skill to the services of the Company and the promotion of its interests; and
(iii) not take part in activities known by the Executive to be detrimental to
the best interests of the Company.
4. Compensation.
In consideration for the services to be performed by the Executive during
the Employment Period hereunder, the Company shall compensate the Executive at
an annual base salary from the date hereof at the rate of $225,000.00 per annum.
The Executive's base salary shall be increased on January 1, 1998 to $250,000.00
per annum, with annual increases of 10% each year thereafter commencing on
January 1, 1999. In addition, the Executive shall be entitled to receive such
bonuses as recommended in the discretion of the Compensation Committee of the
Company's Board of Directors and approved by the Company's Board of Directors.
5. Use of Automobile; Reimbursement of Expenses; Additional Benefits.
5.1 The Executive shall be provided with an automobile to be owned or
leased by the Company or shall be reimbursed for the expenses in connection with
one automobile of the make and type approved by the Company. In addition, the
Company shall pay or reimburse the Executive for the cost of one parking space.
5.2 The Company shall pay directly, or reimburse the Executive for, all
other reasonable and necessary expenses and disbursements incurred by him for
and on behalf of the Company in the performance of his duties under this
Agreement, including all costs associated with the maintenance and use of one
cellular telephone. For such purposes, the Executive shall submit to the Company
itemized reports of such expenses in accordance with the Company's policies.
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5.3 The Executive shall be reimbursed for all business travel and business
entertainment expenses consistent with the Company's practices and policies.
5.4 The Executive shall be entitled to paid vacations during the
Employment Period in accordance with the Company's then prevalent practices for
executive employees.
5.5 The Executive shall be entitled to participate in, and to receive
benefits under, any employee benefit plans of the Company (including, without
limitation, pension, profit sharing, group life insurance and group medical
insurance plans) as may exist from time to time for its executive employees.
6. Restrictive Covenant.
6.1 The services of the Executive are unique, extraordinary and essential
to the business of the Company, particularly in view of the Executive's access
to confidential information. Accordingly, the Executive agrees that, during the
Employment Period, and for a period of one year thereafter, the Executive will
not, without the prior written approval of the Board of Directors of the
Company, directly or indirectly, engage in any business activity competitive
with the business of the Company. Furthermore, the Executive agrees that, during
such period, he shall not solicit, directly or indirectly, or affect to the
Company's detriment any relationship of the Company with any customer, supplier
or employee of the Company or cause any customer or supplier to refrain from
entrusting additional business to the Company. Notwithstanding anything to the
contrary herein, if the employment of the Executive hereunder is terminated by
the Company other than for cause (as defined in Section 7.3), the restraints on
the Executive set forth in the preceding two sentences shall be inapplicable
after the Employment Period. In the event that any of the provisions of this
Section 6.1 shall be adjudicated to exceed the time, geographic or other
limitations permitted by applicable law in any jurisdiction, then such provision
shall be deemed reformed in any such jurisdiction to the maximum time,
geographic or other limitations permitted by applicable law.
6.2 As used in this Section 6, the term "Company" shall mean and include
any and all corporations affiliated with the Company, which either now exist or
which may hereafter be organized.
7. Earlier Termination.
7.1 The Executive's employment hereunder shall automatically be terminated
upon the death of the Executive or Executive's voluntarily leaving the employ of
the Company and, in addition, may be terminated, at the sole discretion of the
Company, as follows:
(a) Upon thirty (30) days' prior written notice by the Company, in
the event of the Executive's disability as set forth in Section 7.2 below;
or
(b) Upon thirty (30) days' prior written notice by the Company, in
the event that the Company terminates the Executive's employment hereunder
for cause as set forth in Section 7.3 below.
7.2 The Executive shall be deemed disabled hereunder, if in the opinion of
the Board of Directors of the Company, as confirmed by competent medical advice,
he shall become physically or mentally unable to perform his duties for the
Company hereunder and such incapacity shall have continued for any period of six
(6) consecutive months.
7.3 For purposes hereof, "cause" shall mean the following: (a) the
Executive's willful malfeasance or gross negligence; or (b) the material breach
of any covenant made by the Executive hereunder, and the Executive's failure to
cure such conduct or event constituting "cause" within 30 days after written
notice thereof.
7.4 In the event that this Agreement shall be terminated due to the
Executive's death or disability, then the Company shall pay to the Executive or
his personal representatives, as the case may be, severance pay in a lump sum
amount equal to base annual salary for a period of twelve months as set forth in
Section 4 hereof. If, however, this Agreement shall be terminated for any other
reason whatsoever, then the Company shall not be obligated to make any severance
payments whatsoever to the Executive hereunder, except for the compensation set
forth in Section 4 hereof which shall have accrued but be unpaid at the
effective time of termination.
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8. No Requirement of Relocation.
The Company expressly agrees that the Executive, as a condition of his
employment, need not relocate his residence from the community in which he
presently resides.
9. Service as Director.
During the Employment Period, the Executive shall, if elected or appointed,
serve as a Director of the Company and/or any subsidiary of the Company upon
such terms as shall be mutually agreed upon by the Executive and the Company.
10. Assignment.
This Agreement, as it relates to the employment of the Executive, is a
personal contract and the rights and interests of the Executive hereunder may
not be sold, transferred, assigned, pledged or hypothecated, except as otherwise
set forth herein. This Agreement shall inure to the benefit of and be binding
upon the Company and its successors and assigns, including without limitation,
any corporation or other entity into which the Company is merged or which
acquires all of the outstanding shares of the Company's capital stock, or all or
substantially all of the assets of the Company.
11. Notices.
Any notice required or permitted to be given pursuant to this Agreement
shall be deemed given three (3) business days after such notice is mailed by
certified mail, return receipt requested, addressed as follows: (i) if to the
Executive, at 00 Xxxx Xxxxx, Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000; and (ii) if
to the Company, at 00 Xxxx Xxxxx, Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, or at
such other address as any such party shall designate by written notice to the
other party. Copies of all notices shall also be provided to Feder, Kaszovitz,
Isaacson, Weber, Xxxxx & Bass LLP, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000-0000.
12. Waiver, Modification.
The terms of this Agreement may not be waived or modified except by an
agreement in writing executed by the parties hereto. The waiver by either party
of any breach of this Agreement must be in writing and shall not be deemed to be
a waiver of any prior or succeeding breach.
13. Governing Law.
This Agreement shall be governed by, and construed and enforced in
accordance with the laws of the State of New York.
14. Severability.
If, at any time subsequent to the date hereof, any provision of this
Agreement shall be held by any court of competent jurisdiction to be illegal,
void or unenforceable, such provision shall be of no force and effect, but the
illegality or enforceability of such provision shall have no effect upon and
shall not impair the enforceability of any other provision of this Agreement.
15. Entire Agreement.
This Agreement constitutes the entire agreement between the parties with
respect to the subject matter hereof and there are no representations,
warranties or commitments except as set forth herein. This Agreement supersedes
all prior and contemporaneous agreements, understandings, negotiations and
discussions, whether written or oral, of the parties hereto relating to the
transactions contemplated by this Agreement; provided, however, that it is the
intention of the parties that this Agreement shall be interpreted and applied in
conjunction with the terms of any option, warrant or other right now in
existence or hereinafter granted to the Executive to acquire shares of capital
stock of the Company. In the event of any conflict, however, the terms of this
Agreement shall govern and prevail. This Agreement may be amended only in
writing executed by the parties hereto affected by such amendment.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
day and year first above written.
XXXX DIGITAL TECHNOLOGIES, INC.
By: /s/ XXXX XXXX
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Xxxx Xxxx, Chief Executive Officer
/s/ XXXXXXX XXXXX
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Xxxxxxx Xxxxx
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