FORM OF EMPLOYMENT AGREEMENT
Exhibit
10.2
FORM
OF EMPLOYMENT AGREEMENT
This
EMPLOYMENT
AGREEMENT
(“Agreement”)
is
entered into as of ___, 2007 by and between Xxxxxxx Xxxx with his residence
at
__________ (“Employee”)
and
Affinity Media International Corp. (the “Company”).
WHEREAS,
Employee has heretofore served as an executive officer of Hotels at Home, Inc.,
a privately held Delaware company (“Hotels”);
WHEREAS,
the
Company is acquiring Hotels pursuant to that certain Agreement and Plan of
Merger between the Company, Affinity Acquisition Subsidiary Corp. and Hotels
dated as of July 24, 2007 (the “Merger
Agreement”)
which
will result, in among other things, Hotels becoming a wholly-owned subsidiary
of
the Company (the “Acquisition”);
WHEREAS,
it is a
condition to the Merger Agreement that Employee agree to be retained as an
executive officer of Hotels and the Company upon consummation of the
Acquisition; and
WHEREAS,
the
Company and Employee are willing to enter into this employment relationship
on
the terms, conditions and covenants set forth in this Agreement.
NOW,
THEREFORE,
in
consideration of the foregoing, the mutual covenants contained herein and other
good and valuable consideration, receipt of which Employee and the Company
hereby acknowledge, Employee and the Company agree as follows:
1. Scope
of Employment
(a) Position.
Employee shall serve in the position of Chief Executive Officer of Hotels and
President and Chief Executive Officer of the Company. Employee agrees to perform
the job duties and to carry out the responsibilities of his position, and in
that capacity Employee shall have such authority and responsibilities as are
consistent with such position and which may be set forth in this Agreement,
in
the Bylaws of Hotels the Company or assigned by the Board of Directors of the
Company (“Board
of Directors”)
from
time to time (the “Services”).
At the
request and in the discretion of the Company, Employee shall serve as an officer
or director of any subsidiary or affiliate of the Company, and shall perform
services for any such subsidiary or affiliate as are appropriate to and
consistent with the Services being performed by Employee for the Company/Hotels.
Employee shall report to the Board of Directors of Hotel and the Company.
(b) Employee’s
Effort.
Employee shall devote substantially all of Employee's regular business time,
energy and skill (except for vacation, holidays, other permitted time off,
or as
otherwise approved by the Board of Directors) to performing her obligations
hereunder, and shall perform her obligations hereunder diligently, faithfully
and to the best of Employee's abilities and to
the
business and interests of the Company, Hotels and its affiliates.
Notwithstanding the foregoing, the Company acknowledges that Employee owns
and
operates certain other business, including Essential Amenities Inc., that have
previously been disclosed to the Company and the Company acknowledges that
Employee’s participation in the ownership or operation of those businesses shall
not violate the terms of this Agreement or Employee’s obligations hereunder to
the extent that they do not materially interfere with the performance of
services under this Agreement.
(c) Place
of Performance.
During
the Term ( as defined in Section 3 below) of his/her employment hereunder,
Employee shall be based at the offices of the Company in New Jersey except
for
reasonably required travel on business of the Company.
(d) Compliance
with Company Policies.
Subject
to the terms of this Agreement, during the Term, Employee shall comply in all
material respects with all policies and procedures applicable to similarly
situated employees of the Company and its affiliated entities generally and
to
Employee specifically.
2. Base
Salary; Bonus; Benefits.
(a) Base
Salary. Employee
shall be paid a base salary (the "Base
Salary")
during
the term at the rate of two Hunder Twenty Five Thousand Dollars ($225,000.00).
Employee's base salary for year two and any subsequent terms shall be determined
by a Compensation Committee designated by the Board of Directors of the Company.
Employee's salary may increase, but it shall not decrease during the Term.
The
Base Salary and all other payments made pursuant to Section 2 shall be (a)
payable according to the customary payroll practices of the Company or pursuant
to such other schedule that the Company may implement from time to time for
such
payments, and (b) subject to any withholdings and deductions required by
applicable law.
(b) Expense
Reimbursement.
The
Company shall pay or reimburse Employee for all reasonable business expenses
incurred or paid by Employee in the course of performing his duties hereunder
and in accordance with Company policy. As a condition to such payment or
reimbursement, however, Employee shall provide to the Company, upon the
Company's request, reasonable documentation and receipts for such expenses.
Employee shall also be entitled to reimbursement for reasonable expenditures
and
fees related to parking, association fees, membership dues in trade groups,
subscriptions for industry related publications and any conference fees and
charges.
(c) Annual
Bonus.
Employee
shall be entitled to receive bonus awards in such form and amounts as may be
determined by the Compensation Committee designated by the Board of Directors
(or the full Board of Directors) at its sole discretion. Employee shall be
eligible to receive an annual performance bonus of up to 100% of the Base Salary
for each year of the term of this Agreeement. The Compensation Committee (or
the
full Board of Directors of the Company) shall establish standards related to
the
revenue and income and other performance related standards for the determination
of bonuses no later than March 31 of the calendar year for which a bonus may
be
awarded and the bonus shall be payable on or before April 15th
of the
following calendar year on which the bonus standards are based.
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(d) Discretionary
Bonus.
In
addition to the foregoing, Employee shall be eligible for and may receive
discretionary bonuses, the grant and amount of which shall be determined by
the
Board of Directors of the Company (or a Compensation Committee thereof) in
its
sole discretion.
(e)
Stock
Option and Stock Award Programs. Employee
shall be eligible to participate in any incentive stock option or stock award
plans, as may be established by the Company from time to time. Any awards under
such plans shall be at the discretion of the Compensation Committee designated
by the Board of Directors (or the full Board of Directors) and in compliance
with the terms of such plans, including, without limitation, the form of
Affinity 2007 Stock Incentive Plan as described in the Company’s Proxy Statement
for its special meeting of stockholders held on _____, 2007.
(f) Other
Compensation and Benefits.
Employee shall receive such additional compensation or other benefits as are
provided to Company senior executives including, without limitation the
following:
i. during
the Term, Employee shall be entitled to participate in such of the Company's
retirement, supplemental retirement, life, health, disability and other
insurance programs, as well as other employee benefit programs, which are
generally available to other similarly situated employees of the Company,
subject to the Company's policies with respect to all such benefits or insurance
programs or plans. The Company shall not, by virtue of this provision, be under
any obligation to Employee to continue to maintain any particular plan or
program or any particular benefit level under any plan or program.
ii. Employee
shall be entitled to 4 weeks of paid vacation per calender year during the
Term,
to be taken from time to time. Unused vacation shall be carried over from one
year to the next or Employee may elect to receive cash in lieu of any unused
vacation time.
iii.
Employee
shall be entitled to a vehicle allowance of $1,000 per month.
3. Term;
Termination.
This
Agreement shall be effective on the date hereof (“Effective Date”) and terminate
on the second anniversary hereof (the “Initial Term”), subject to automatic
consecutive one-year extension(s) (each a “Renewal Term”) unless either the
Company or Employee provides written notice of termination to the other not
later than ninety (90) days prior to the scheduled expiration of the Term as
then in effect. The Initial Term and any Renewal Terms shall be referred to
collectively as the “Term”.
(a) Termination
Upon Death or Disability.
This
Agreement shall automatically terminate upon the death or Incapacity of Employee
and, thereafter all of her or his rights hereunder, including the rights to
receive compensation and benefits, except as otherwise required by law or set
forth herein, shall terminate. As used herein, the term “Incapacity”
means
a
serious
mental or physical condition, whereby Employee is unable to or has been
prevented from substantially performing the duties of his or her position for
a
period of either (i) 120 continuous days during any 12 month period during
Employee’s term of employment, or (ii) 180 days during any 12 month period
during Employee’s term of employment, regardless of whether they are continuous.
Upon termination for death or Incapacity, the Company shall pay to Employee
(or
his/her estate) (i) the Base
Salary and any other compensation earned up to the date of termination,
including any pro-rata bonus, as well as any unreimbursed expenses and accrued
but unused vacation days; and (ii) the
Base
Salary at the annualized rate in effect on the date of termination for a period
of 12 months in the event of termination because of Employee’s death or
Incapacity.
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(b) Termination
Without Cause or Without Good Reason.
The
Company may terminate this Agreement without Cause and Employee may terminate
without Good Reason, in each case upon thirty (30) days prior written notice
to
the other party. In case of termination by Employee without Good Reason, the
Company shall have no further obligations after the termination date other
than
the payment to Employee of the Base Salary accrued and unpaid through the
termination date and payment of any unreimbursed expenses and any accrued but
unused vacation days. In case of termination by the Company without Cause or
in
the case of Non-Renewal of this Agreement by the Company, the Company shall
pay
Employee the Base Salary and any other compensation earned up to the date of
termination, including any pro-rata bonus, as well as any unreimbursed expenses
and accrued but unused vacation days, and (ii) the Base Salary and anticipated
bonuses and the continuation of Company-sponsored medical and health benefits
previously made available to Employee to the greatest extent permitted by law
for the greater of the remaining Term of this Agreement or the 18-month period
immediately following the termination date (the “Salary
Continuation Period”).
Any
payments due hereunder shall be made in accordance with the regularly scheduled
payment of salary and bonus in effect prior to such termination.
(c) Termination
for Cause.
As used
herein for “Cause” shall
mean any one or
more
of
the following
as determined in good faith by Board of Directors of the Company:
(1) an
act of
fraud, embezzlement or theft by Employee in connection with his or her duties
or
in the course of employment with the Company or its affiliated
entities;
(2) Employee’s
material breach of any material provision of this Agreement, provided that
in
those instances in which Employee’s material breach is capable of being cured,
Employee has failed to cure within a 30 day period after receiving from the
Board of Directors written notice of the breach providing reasonable detail
as
to the specifics of such breach and the manner in which such breach can be
cured;
(3) Employee’s
material act or omission, which is (x) willful or grossly negligent, (y)
contrary to established policies or practices of the Company and its affiliated
entities, and (z) materially harmful to the business or reputation of the
Company or its affiliated entities, or to the business of the customers or
suppliers of the Company or Hotels as such relate to the Company or Hotels;
(4) Employee’s
plea of nolo
contendere
to, or
conviction for, a felony involving moral turpitude; or
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(5) Employee’s
material breach of any policy established by the Board of Directors related
to
trading of the Company’s securities, any violation of federal or state xxxxxxx
xxxxxxx laws or regulations or employee’s refusal or failure to cooperate with
an inquiry or investigation of the Board of Directors, any special committee
or
a governmental agency, after receiving written instructrion from the Board
of
Direcotrs of the Company to cooperate.
The
Company may immediately terminate this Agreement for Cause upon
written
notice to Employee.
In the
event of a termination by the Company for Cause, the
Company will
pay
Employee
the Base
Salary accrued
and unpaid through the termination date and payment of any unreimbursed expenses
and any accrued but unused vacation days. Any unvested stock awards or options
shall be forfeited. After payment of the foregoing, the Company xxxx have no
further responsibility for other payments to Employee. In the event of a
Termination under clause (c) (1) above, the Company shall not be required to
indemnify Employee for any costs or expenses associated with such offense and
may seek, at its option, to collect all costs, expenses and damages from
Employee.
(d) Termination
for Good Reason.
Upon 30
days written notice to the Company, Employee may immediately terminate her
or
his employment under this Agreement for “Good Reason” as defined below. The
Company shall have the right to cure any Good Reason which is capable of cure
within such 30 day period. In case of termination hereof by the Employee for
Good Reason, the Company shall pay Employee (i) the Base Salary and any other
compensation, including bonuses, earned up to the date of termination, including
any pro-rata bonus, as well as any unreimbursed expenses and accrued but unused
vacation days and (ii) for the greater of the remaining Term of this Agreement
or the 18-month period immediately following the termination date, (A)
Employee’s Base Salary and anticipated bonuses and the continuation of
Company-sponsored medical and health benefits previously made available to
Employee to the greatest extent permitted by law for the greater of the
remaining Term of this Agreement for the Salary Continuation Period (B) the
continuation of Company-sponsored medical and health benefits previously made
available to Employee to the greatest extent permitted by law for the
Salary Continuation
Period.
For
purposes of this Agreement, the term “Good
Reason”
means,
in each case without the consent or agreement of Employee but shall not include
any termination for Cuase by the Company:
(1) any
reduction by the Company in Employee’s Base Salary or adverse change in the
manner of computing Employee’s bonus, as in effect from time to time, on an
annual basis;
(2) the
failure by the Company to renew Employee’s employment agreement or to pay or
provide to Employee any amounts of Base Salary or bonus or any benefits which
are due, owing and payable to Employee pursuant to the terms of this Agreement;
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(3) except
on
a temporary basis as a result of Incapacity as described above, a material
adverse change in Employee’s responsibilities, position, reporting
relationships, authority or duties;
(4) the
relocation of the office in which Employee primarily conducts business to a
location more than 10 miles from the office in which Employee primarily conducts
business at the date of the commencement of each Term of this Employment
Agreement, unless such relocation is recommended or approved by Employee;
(5) without
limiting the generality or effect of the foregoing, any material breach of
this
Agreement by the Company; or
(6) the
failure by the Company to continue to provide Employee with benefits
substantially similar in the aggregate to the Company’s life insurance, medical,
dental, health, accident or disability plans in which the Employee is
participating at the date of the commencement of this Employment
Agreement.
(e) Termination
Upon a Change of Control.
In the
event that during the period beginning 3 months before the occurrence of a
“Change in Control” and ending 1 year after a Change in Control Employee’s
employment is terminated: (i) by Employee for Good Reason, (ii) by the Company
(or its successor or acquirer) without Cause, or (iii) by expiration of this
Agreement due to Employee refusing to renew this Agreement for Good Reason,
the
Company shall pay Employee (i) the Base Salary and any other compensation earned
up to the date of termination, including any pro-rata bonus, as well as any
unreimbursed expenses and accrued but unused vacation days and (ii) for
the
Salary Continuation
Period, the Base Salary and the continuation of Company-sponsored medical and
health benefits previously made available to Employee, but only to the extent
permitted by such policies or plans, or as otherwise required by law. In
addition to the benefits provided for above, any and all of the Employee’s
outstanding options granted pursuant to the equity award plan as well as any
other equity award to Employee shall become immediately vested and exercisable,
and any provision of such options which provides for termination of the option
upon, or within a stated time after termination of employment, shall become
void
and such option shall become a nonqualified stock option for tax purposes (to
the extent it was not already a nonqualified option). All of these options
shall
remain exercisable for a period of 1 year from the termination date, and shall
be exercisable on a cashless basis for a period of 90 days following the
effective termination date (or the effective date of any Change of Control
event
if Employee’s employment was terminated at any time during the three month
period prior to the Change of Control).
For
purposes of this Agreement, the term “Change
of Control”
means
the occurrence of any one or more of the following events (except as otherwise
consented or agreed to by Employee prior to such event):
(i) any
Person as that term is used in Section 13(d)(3) or Section 14(d)(2) of the
Securities Exchange Act of 1934 (the “Exchange
Act”)
(other
than the Company or a corporation owned directly or indirectly by the
shareholders of the Company in substantially the same proportions as their
ownership of stock of the Company) becomes the Beneficial Owner, as that term
is
defined in Rule 13d-3 of the General Rules and Regulations under the Exchange
Act, directly or indirectly, of securities of the Company, representing more
than 40% of the combined voting power of the Company’s then outstanding
securities;
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(ii) during
any period of 24 consecutive months beginning on or after the Effective Date,
individuals who at the beginning of the period constituted the Board of
Directors cease for any reason (other than death, disability or voluntary
retirement) to constitute a majority of the Board of Directors. For this
purpose, any new director whose election by the Board of Directors, or
nomination for election by the Company’s shareholders, was approved by a vote of
at least two-thirds of the directors then still in office, and who either were
directors at the beginning of the period or whose election or nomination for
election was so approved, will be deemed to have been a director at the
beginning of any 24 month period under consideration; or
(iii) the
shareholders of the Company approve: (A) a plan of complete liquidation or
dissolution of the Company; or (B) an agreement for the sale or disposition
of
all or substantially all the Company’s assets; or (C) a merger, consolidation or
reorganization of the Company with or involving any other corporation, other
than a merger, consolidation or reorganization that would result in the voting
securities of the Company outstanding immediately prior thereto continuing
to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity) at least eighty percent of the combined
voting power of the voting securities of the Company (or such surviving entity)
outstanding immediately after such merger, consolidation, or
reorganization.
4. Confidentiality.
(a) Employee
shall keep confidential, except as the Company may otherwise consent in writing,
and not disclose or make any use of except for the benefit of the Company,
at
any time during the term of this Agreement and for a period of two (2) years
thereafter, any trade secrets, knowledge, data or other confidential, secret
or
proprietary information of the Company relating to employees, suppliers,
inventions, products, processes, knowledge, know how, technical or other data,
designs, formulas, test data, customer lists, business plans, marketing plans
and strategies, and product pricing strategies, financial condition or other
subject matter pertaining to any business of the Company and itd its affiliated
entities, or any of its clients, customers, consultants, licensees,
subsidiairies or affiliates which Employee may produce, obtain or otherwise
learn of during the course of Employee’s performance of services and after its
termination (collectively “Confidential
Information”),
provided that the term “Confidential Information” shall not include information,
technical data or know-how that is or becomes part of the public domain not
as a
result of any inaction or action of Employee. Employee shall not deliver,
reproduce, or in any way allow any such Confidential Information to be delivered
to or used by any third parties without the specific direction or consent of
a
duly authorized representative of the Company. The terms of this paragraph
shall
survive termination of this Agreement.
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(b) Return
of Confidential Material.
Upon
the completion or other termination of Employee’s services for the Company,
Employee shall promptly surrender and deliver to the Company all records,
materials, equipment, drawings, documents, notes and books and data of any
nature (electronic or otherwise) describing, including or pertaining to any
Confidential Information, and Employee will not take with him or her any
description containing or pertaining to any Confidential Information which
Employee may produce or obtain during the course of his or her services. The
terms of this paragraph shall survive termination of this
Agreement.
5.
Intellectual
Property
(a) During
the term of this Agreement and thereafter, Employee will execute, acknowledge
and deliver to the Company or its nominee upon request and at its expense all
such documents, including applications for patents and copyrights and
assignments of inventions, patents and copyrights to be issued therefore, as
the
Company may reasonably determine necessary or desirable to apply for and obtain
letters, patents, and copyrights on inventions in any and all countries and/or
to protect the interest of the Company or its nominee in inventions, patents
and
copyrights and to vest title thereto in the Company or its nominee. The terms
of
this paragraph shall survive termination of this Agreement.
(b) Maintenance
of Records.
Employee will keep and maintain adequate and current written records of all
inventions and other intellectual property made or conceived by Employee (in
the
form of notes, sketches, drawings and as may be specified by the Company)
related to the Company’s business, and shall deliver such records promptly to
the Company at the Company’s request, whether made solely by Employee or jointly
with others, which records shall be available to and remain the sole property
of
the Company at all times.
6. Competition.
Employee shall agree that, during the employment term, and if applicable, the
Salary Continuation Period, Employee will not (i) directly or indirectly, own,
manage, operate, control or otherwise be connected with, or have any financial
interest in, or aid or assist anyone else in the conduct of, any entity or
business which competes with the business conducted by Hotels in each and every
area where such business is being conducted during the employment term, other
than owning less than 5% of a publicly traded company, or (ii) enter into,
effect or accept, directly or indirectly, for or on behalf of herself, himself
or any other person, any business relating to the services of the type provided
by, or orders for business or services of the type provided by, Hotels or any
of
its subsidiaries, affiliates or divisions from any person, company, firm or
other entity who is, or has at any time within one year prior to the date of
such action been, a customer or supplier (or a prospective customer or supplier)
of Hotels or any of its subsidiaries, affiliates or divisions. Employee shall
also agree that, for a period of 24 months from the date of termination of
Employee’s employment for whatsoever reason, Employee will not, either
personally or by her or his agent or by letters, circulars or advertisements,
and whether for herself, himself or on behalf of any other person, (i) seek
to
persuade any employee of the Company or any of its subsidiaries or divisions
to
discontinue his or her status or employment therewith or to become employed
in a
business or activities likely to be competitive with the business of the
Company, or (ii) solicit or employ any such person at any time within 24 months
following the date of cessation of employment of such person with the Company
or
any of its subsidiaries or divisions in each and every area where the Company
conducts its business, provided
that the
foregoing shall not apply to any communications with or the solicitation of
the
spouse of any executive. Furthermore, the Company acknowledges that nothing
herein shall preclude Employee from placing a general solicitation in a
periodical of general solicitation. Notwithstanding any of the foregoing, the
Company acknowledges that it is aware of Employee’s ownership and operation of
certain other businsses, inclusing Essential Amenities Inc., and the Company
agrees that Employee’s ownership and operation of these businesses shall not
constitute a violation of this provision.
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7. Other
Obligations.
Employee acknowledges that all of Employee’s obligations under this Agreement
(but not including the restrictive covenants contained herein) shall be subject
to any applicable agreements with, and policies issued by the Company to which
Employee and all other similarly-situated employees are subject.
8. Trade
Secrets of Others.
Employee represents that his or her performance of all the terms of this
Agreement as employee to the Company does not and will not breach any agreement
to keep in confidence proprietary information, knowledge or data acquired by
Employee in confidence or in trust, and Employee will not, except in compliance
with the performance of his/her duties, disclose to the Company, or allow the
Company to use, any confidential or proprietary information or material
belonging to any other person or entity. Employee will not enter into any
agreement, either written or oral, which is in conflict with this
Agreement.
9. Injunctive
Relief.
Employee acknowledges that any breach or attempted breach by Employee of
Sections 5 and 7 of this Agreement shall cause the Company irreparable harm
for
which any adequate monetary remedy does not exist. Accordingly, in the event
of
any such breach or threatened breach, the Company shall be entitled to obtain
injunctive relief, without the necessity of posting a bond or other surety,
restraining such breach or threatened breach.
10. Reasonable
Terms.
Employee acknowledges and agrees that the restrictive covenants contained in
this Agreement have been reviewed by Employee with the benefit of counsel and
that such covenants are reasonable in all of the circumstances for the
protection of the legitimate interests of the Company and its affiliated
entities.
11. Modification.
This
Agreement may not be changed, modified, released, discharged, abandoned, or
otherwise amended, in whole or in part, except by an instrument in writing,
signed by Employee and by the Company. Any subsequent change or changes in
Employee’s relationship with the Company or Employee’s compensation shall not
affect the validity or scope of this Agreement.
12. Entire
Agreement.
Employee acknowledges receipt of this Agreement, and agrees that with respect
to
the subject matter thereof, it is Employee’s entire agreement with the Company,
superseding any previous oral or written communications, representations,
understandings with the Company or any office or representative thereof. Each
party to the Agreement acknowledges that, in executing this Agreement, such
party has had the opportunity to seek the advice of independent legal counsel,
and has read and understood all of the terms and provisions of the
Agreement.
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13. Severability.
In the
event that any paragraph or provision of this Agreement shall be held to be
illegal or unenforceable, the entire Agreement shall not fail on account
thereof. It is further agreed that if any one or more of such paragraphs or
provisions shall be judged to be void as going beyond what is reasonable in
all
of the circumstances for the protection of the interests of the Company, but
would be valid if part of the wording thereof were deleted or the period thereof
reduced or the range of activities covered thereby reduced in scope, the said
reduction shall be deemed to apply with such modifications as may be necessary
to make them valid and effective and any such modification shall not thereby
affect the validity of any other paragraph or provisions contained in this
Agreement.
14. Successors
and Assigns.
This
Agreement shall be binding upon Employee’s heirs, executors, administrators or
other legal representatives and is for the benefit of the Company, its
successors and assigns.
15. Governing
Law.
This
Agreement shall be governed by the laws of the State of Delaware except for
any
conflicts of law rules thereof that might direct the application of the
substantive law of another state.
16. Counterparts.
This
Agreement may be signed in counterparts and delivered by facsimile transmission,
and each such counterpart shall be deemed an original and all of which shall
together constitute one agreement.
17. No
Waiver.
No
waiver by one party to this Agreement of any breach of this Agreement by the
other party shall constitute a waiver of any subsequent breach. All waivers
shall be in writing and signed by the party to be charged
therewith.
18. Notice.
Any
notice hereby required or permitted to be given shall be sufficiently given
if
in writing and upon mailing by registered or certified mail, postage prepaid,
to
either party at the address of such party or such othis address as shall have
been designated by written notice by such party to the other party.
19. Taxes.
The
Company may withhold from any payments made under this Agreement (including
severance payments) all applicable taxes, including but not limited to
income,
employment and social insurance taxes, as shall be required by law.
Employee acknowledges and represents that the Company has not provided any
tax
advice to him or her in connection with this Agreement and that he or she has
been advised by the Company to seek tax advice from his or her own tax advisors
regarding this Agreement and payments that may be made to him or her pursuant
to
this Agreement, including specifically, the application of the provisions of
Section
409A of
the Code to such payments.
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20. Section
409A Safe Harbor.
Notwithstanding anything in this Agreement to the contrary, in no event shall
the Company commence payment or distribution to the Employee of any amount
that
constitutes “nonqualified deferred compensation” within the meaning of
Section 409A of the Code, earlier than the earliest permissible date under
Section 409A of the Code that such amount could be paid or distributed
without additional taxes or interest being imposed upon the Employee under
Section 409A of the Code. If any payments or distributions are delayed
pursuant to the immediately preceding sentence, the Company will accrue such
amounts without interest during such period as the payment or distribution
may
be required to be deferred under Section 409A of the Code (which is anticipated
to be a six-month period following Employee’s separation from service within the
meaning of Section 409A of the Code) and will become payable in a lump sum
payment on the first business day that such amount could be paid or distributed
without additional taxes or interest being imposed upon the Employee under
Section 409A of the Code. The Company and the Employee agree that they will
execute any and all amendments to this Agreement as they mutually agree in
good
faith may be necessary to ensure compliance with the distribution provisions
of
Section 409A of the Code or as otherwise needed to ensure that this
Agreement complies with Section 409A.
[SIGNATURES
TO FOLLOW]
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IN
WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first forth above.
| AFFINITY MEDIA INTERNATIONAL CORP. | ||
| |
|
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| By: | ||
|
Name: |
||
| Title: | ||
| EMPLOYEE | ||
|
|
||
[Signature
Page to Employment Agreement]
