1
EXHIBIT 10.1
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT (this "Agreement") is entered into
as of October 25, 1999 (the "Effective Date"), by and between SELECT MEDIA
COMMUNICATIONS, INC., a New York corporation (the "Company"), and XXXXX X.
XXXXXXXXX (the "Executive").
IN CONSIDERATION of the mutual covenants and agreements hereinafter set
forth, the Company and Executive agree as follows:
1. Agreement Term.
The term of this Agreement shall be the period commencing on
the Effective Date and ending on the fifth anniversary thereof (the "Agreement
Term").
2. Employment.
a. Employment by the Company. Executive agrees to be
employed by the Company for the Agreement Term upon
the terms and subject to the conditions set forth in
this Agreement. Throughout the Agreement Term,
Executive shall serve as the CEO/Chairman of the
Company.
b. Performance of Duties. Throughout this Agreement
Term, Executive shall faithfully and diligently
perform his duties in conformity with the directions
of the Board of Directors of the Company (the
"Board"), consistent with his position as the
CEO/Chairman of the Company.
c. Place of Performance. During the Agreement Term,
Executive shall be based at the Company's executive
offices in New York, New York.
3. Compensation.
a. Base Salary. The Company agrees to pay to Executive a
base salary at the annual rate set forth below, or as
otherwise increased from time to time by the Board
(the "Base Salary"):
YEAR OF AGREEMENT TERM BASE SALARY
---------------------- -----------
1 $200,000
2 $300,000
3 $350,000
4 $400,000
5 $500,000
2
Base Salary shall be payable in installments consistent with the Company's
payroll practices.
b. Annual Incentive Bonus. No later than the March 15th
following the end of each calendar year, the Company
shall pay a cash bonus to Executive equal to two
percent (2%) of the pre-tax net income for the
calendar year of the Company and its consolidated
subsidiaries, prior to reduction for such bonus (the
"Incentive Bonus"). The Incentive Bonus amount shall
be payable for an entire calendar year for each
calendar year that ends during the Agreement Term,
and for any other bonus period that is less than a
full calendar year, the Incentive Bonus shall be
determined with respect to the Company's net income
amounts for the entire calendar year multiplied by a
fraction, the numerator of which is the number of
calendar days in such period, and the denominator of
which is 365. Incentive Bonuses shall be paid in the
form of cash.
c. Common Stock Award; Stock Options
i. In recognition of past services rendered to
the Company by Executive, the Company
hereby grants to Executive (x) 2,000,000
shares (the "Grant Shares") of common stock
of the Company, par value $.001 per share
(the "Common Stock"), which grant shares
shall vest on the first anniversary of the
date hereof.
ii. Executive acknowledges and agrees that the
Shares have not been registered under the
Securities Act of 1933, as amended (the
"Act"), and are "restricted securities"
within the meaning of Rule 144 promulgated
under the Act, and will bear the following
legend restricting their transferability:
THE SHARES OF STOCK REPRESENTED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR
ANY STATE SECURITIES LAWS. THE SHARES MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED,
TRANSFERRED OR OTHERWISE DISPOSED OF UNTIL
THE HOLDER HEREOF PROVIDES EVIDENCE
SATISFACTORY TO THE ISSUER (WHICH, IN THE
DISCRETION OF THE ISSUER, MAY INCLUDE AN
OPINION OF COUNSEL, SATISFACTORY TO THE
ISSUER) THAT SUCH OFFER, SALE, PLEDGE,
-2-
3
TRANSFER OR OTHER DISPOSITION WILL NOT
VIOLATE APPLICABLE FEDERAL OR STATE LAWS.
iii. Executive acknowledges that the Shares must be held
indefinitely unless subsequently registered under the Act or
an exemption from such registration is available. Executive is
aware of the provisions of Rule 144 promulgated under the Act,
which permit the limited resale of shares subject to the
satisfaction of certain conditions, including, among other
things, the existence of a public market for the shares, the
availability of certain current public information about the
Company, the resale occurring not less than one (1) year after
a party has received the security to be sold and provided the
consideration in exchange therefor, the sale being effected
through "broker's transaction" or in transactions directly
with a "market maker" (as provided by Rule 144(f)) and the
number of shares being sold during any three (3) month period
not exceeding specified limitations.
iv. Pursuant to this Agreement, Executive has been issued the
Grant Shares and options to purchase an additional 1,500,00
shares of common stock, for an aggregate of 3,500,000 shares
of common stock (collectively, the "Executive Shares").
(1) Protection Against Dilution. If the Company shall at
any time during the term of this Agreement: (i)
declare or pay to the holders of Common Stock a
dividend payable in any kind of shares of stock of
the Company; or (ii) change or divide or otherwise
reclassify its Common Stock into the same or
different number of shares with or without par value,
or into shares of any class or classes; or (iii)
consolidate or merge with, or transfer all or
substantially all of its property to, any other
affiliated corporation; or (iv) make any distribution
of its assets to holders of its Common Stock as a
liquidation or partial liquidation dividend or by way
or return of capital, with the result that the number
of Executive Shares shall represent less than 15% of
the number of fully-diluted shares of Common Stock of
the Company, then, Executive shall receive such
additional shares of Common Stock, or such
reclassified shares of Common Stock of the Company,
or such shares or securities or assets of the entity
resulting from such consolidation or merger or
transfer of such assets of the Company, as are
necessary for the number of shares of Common Stock
held by Executive to be equal to 15% of the
fully-diluted shares of Common Stock of the Company
(after giving effect to such issuance).
-3-
4
(2) If the Board of Directors of the Company shall (i)
declare any dividend or other distribution with
respect to the Common Stock, other than a cash
dividend, (ii) offer to the holders of the shares of
Common Stock any additional shares of Common Stock,
any securities convertible into or exercisable for
shares of Common Stock or any rights to subscribe
thereto, or (iii) propose a dissolution, liquidation
or winding up of the Company, the Company shall mail
notice thereof to Executive not less than fifteen
(15) days prior to the record date fixed for
determining stockholders entitled to participate in
such dividend, distribution, offer or subscription
right or to vote on such dissolution, liquidation or
winding up.
(3) If at any time or from time to time the Company shall
take any action affecting its Common Stock or any
other capital stock of the Company, not otherwise
described in any of the foregoing subsections of this
Section 3(c)(iv), then, if the failure to make any
adjustment would, in the reasonable opinion of the
members of the Board of Directors of the Company,
have a materially adverse effect upon the rights of
Executive, the number of shares of Executive Shares,
shall be adjusted in such manner and at such time as
the members of the Board of Directors of the Company
may in good faith determine to be equitable under the
circumstances.
(4) Upon any adjustment or modification of the rights of
the Executive in accordance with this Section
3(c)(iv), the Company shall promptly cause its Chief
Financial Officer to provide a notice to the
Executive setting forth such adjustment or
modification, a brief statement of the facts
requiring such adjustment or modification and the
manner of computing the same.
v. Piggyback Registrations.
(1) Right to Piggyback. Whenever the Company proposes to
register any of its securities under the Act and the
registration form to be used may be used for the
registration of the Shares (a "Piggyback
Registration"), the Company shall give prompt written
notice to Executive of its intention to effect such a
registration and will include in such registration
all Shares with respect to which the Company has
received a written request by Executive for inclusion
-4-
5
therein within thirty (30) days after the receipt of
the Company's notice.
(2) Priority on Primary Registrations. If a Piggyback
Registration is an underwritten primary registration
on behalf of the Company, and the managing
underwriters advise the Company in writing that in
their opinion the number of securities requested to
be included in such registration exceeds the number
which can be sold in such offering without adversely
affecting the marketability of the offering, the
Company will include in such registration (x) first,
the securities the Company proposes to sell, and (y)
second, the Shares requested to be included in such
registration, pro rata among the Executive and other
holders of such registrable securities on the basis
of the voting power of shares owned by Executive and
each such other holder.
vi. Demand Registration. In the event that this Agreement is
terminated for any reason prior to the third anniversary of
the date hereof, the Company shall, upon the request of
Executive, prepare and file within ninety (90) days of
Executive's request, a registration statement with the
Securities and Exchange Commission covering the Executive
Shares, and shall use its best efforts to cause such
registration statement to become effective promptly.
4. Benefits.
a. During the Agreement Term, Executive shall be entitled to (1)
vacations (taken consecutively or in segments), aggregating
four (4) weeks each fiscal year; (2) reasonable sick leave;
(3) participate in the Company's medical plan; and (4)
participate in any employee benefit plan or fringe benefits
program from time to time in effect for the benefit of any
employee, executive or officer of the Company.
b. It is expressly understood that the Company may in its
discretion from time to time modify any bonus, benefit or
other employee programs applicable to substantially all
employees who benefit from each program, including, without
limitation, terms of eligibility, benefit levels and other
terms and conditions, and that all such modifications shall be
binding on Executive.
c. Executive agrees that the Company shall withhold from any and
all payments required to be made to Executive pursuant to this
Agreement all federal, state, local and/or other taxes which
the Company determines are required to be withheld in
accordance with applicable statutes and/or regulations from
time to
-5-
6
time in effect.
d. Automobile Allowance. The Company shall provide Executive with
an automobile allowance of $1,600 per month, and the Company
shall pay Executive's gasoline, insurance and maintenance
expenses for operating one automobile.
e. Travel and Entertainment Allowance. The Company shall provide
Executive with a travel and entertainment allowance of $2,000
per month. Executive shall not be required to account for, or
establish the reasonableness of, his travel and entertainment
expenses.
5. Termination of Employment.
a. Ability to Terminate. Executive may terminate this Agreement
and his employment with the Company prior to the expiration of
the Agreement Term. The Company may also terminate this
Agreement and Executive's employment with the Company prior to
the expiration of the Agreement Term. In the event of a
termination of this Agreement by either Executive or the
Company, the termination payments provided in this Section 5
shall be the only payments that the Company shall be obligated
to make on account of or after such termination, except for
any benefits provided under any employee benefit plan of the
Company.
b. Termination for Good Reason or Without Cause. If Executive
terminates his employment with the Company for Good Reason, or
if the Company terminates Executive's employment with the
Company without Cause, Executive shall be entitled to the
following within thirty (30) days of such termination (or at
such other time provided below):
i. his Base Salary and any earned and unused vacation
accrued through the date of such termination; plus
ii. the Incentive Bonus for the calendar year of the
termination (which shall be payable no later than the
March 15th following the calendar year of the
termination) and any other accrued and unpaid
Incentive Bonus amounts; plus
iii. any expenses that have not been reimbursed in
accordance with the terms of this Agreement; plus
-6-
7
iv. his annual Base Salary for the period between the
date of such termination and the expiration of the
Agreement Term;
v. the Incentive Bonus on account of the remaining
calendar year(s) within the Agreement Term after the
calendar year of the termination (which shall be
payable no later than the March 15th following the
applicable calendar year.
c. Termination For Cause. If the Company terminates Executive's
employment for Cause, Executive shall be entitled to the
following within thirty (30) days of the date of such
termination (or at such other time provided below):
i. his Base Salary and any earned and unused vacation
accrued through the date of such termination; plus
ii. the Incentive Bonus for the calendar year of the
termination (which shall be payable no later than the
March 15th following the calendar year of the
termination); plus
iii. any expenses that have not been reimbursed in
accordance with the terms of this Agreement; plus
iv. his Base Salary for the period between the date of
such termination and either (x) the expiration of the
Agreement Term or (y) the second anniversary of the
date of such termination, whichever period is
shorter; plus
v. the Incentive Bonus on account of either (x) the two
calendar years following the calendar year of such
termination or (y) the period prior to the expiration
of the Agreement Term, whichever period is shorter.
d. Disability. If the Company terminates Executive's employment
because of Executive's Disability, then the Company shall
provide the following to Executive within thirty (30) days of
the date of such termination (or at such other time provided
below):
i. the Base Salary and any earned and unused vacation
accrued through the date of such termination; plus
ii. the Incentive Bonus for the calendar year of the
termination (which shall
-7-
8
be payable no later than the March 15th following the
calendar year of the termination) and any other
accrued and unpaid Incentive Bonus amounts; plus
iii. any expenses that have not been reimbursed in
accordance with the terms of this Agreement.
e. Death. In the event of the death of Executive during the
Agreement Term, the Base Salary to which Executive is entitled
hereunder shall continue to be paid through the end of the
calendar year in which death occurs to the last beneficiary
designated by Executive pursuant to the last beneficiary
designated by Executive pursuant to Section 18 hereof, or,
failing such designation, to his estate. Upon payment of such
salary, the Company shall have no further obligations under
this Agreement.
f. No Mitigation. In the event of any termination of employment
under this Section 5, Executive shall be under no obligation
to seek other employment, and there shall be no offset against
amounts due to Executive under this Agreement on account of
any remuneration attributable to any subsequent employment
(including any self-employment) that he may obtain.
g. Definitions. For purposes of this Agreement, the following
terms shall have the following meaning:
i. "Cause" shall mean (1) the failure of Executive to
perform his duties as defined in Section 2 above with
the Company or the breach of this Agreement by
Executive if the Company gives notice of such cause
and it remains uncured for ten (10) days following
such notice; (2) any act by Executive of fraud, theft
or dishonesty; (3) drug or alcohol abuse or related
behavior that impedes Executive's job performance or
brings Executive or the Company into disrepute in the
community; (4) misappropriation by Executive of funds
or any corporate opportunity; (5) a conviction or
affirmative finding by an appropriate administrative
agency that Executive is guilty of a felony or a
misdemeanor involving moral turpitude (or a plea of
nolo contendere thereto); (6) acts by Executive
attempting to secure or securing any personal profit
not fully disclosed to and approved by the Board of
the Company in connection with any transaction
entered into on behalf of the Company; (7) gross,
willful or wanton negligence or misconduct by
Executive; or (8) any act or omission that the Board
of Directors reasonably believes to be harmful to the
Company, or any affiliate thereof.
ii. "Disability" shall mean any physical or mental
disability or incapacity
-8-
9
which continues for ninety (90) consecutive days or
an aggregate period of more than one hundred eighty
(180) days in any twelve (12) month period and which
shall render Executive incapable of performing the
services required of him by the Company. Disability
benefits, if any, due under applicable plans and
programs of the Company shall be determined under the
provision of such plans and programs.
iii. "Good Reason" shall mean a material breach by the
Company of the terms of this Agreement, which breach
continues for thirty (30) days after written notice
thereof from Executive.
6. Restrictive Covenant.
a. Pursuant to this Agreement, Executive has agreed to become an
Executive of the Company and to comply with the non-disclosure
provisions of Section 8 hereof. Executive recognizes and
acknowledges that he will be given access to certain of the
Company's confidential information, and has access to and
authority to develop relationships with customers of the
Company because of his position and status as an employee of
Company, which he would not otherwise attain. In consideration
of the foregoing, Executive agrees to comply with the terms of
this Section 6.
b. The restrains imposed by this Section 6 shall apply during any
period that Executive continues to receive payment of Base
Salary hereunder, and (i) for a period of one (1) year
thereafter (the "Restricted Period"). In the event that any
Court having jurisdiction should find that the Restricted
period is so long and/or the scope (distance)(as set forth
below) is so broad as to constitute an undue hardship on
Executive, then, in such event only, the Restricted Period and
area limitations shall be valid for the maximum time and area
for which they could be legally made and enforced.
c. During the Restricted Period, Executive shall not, as an
employee (other than of the Company or an affiliate of the
Company), the Company, stockholder, officer, director,
partner, consultant, advisor, proprietor, lender, provider of
capital or other ownership, operational or management
capacity, directly or indirectly, through any other person,
firm or corporation (i) solicit or hire any person who on the
date of Executive's termination is, or within the last three
(3) months of Executive's employment by the Company was, an
employee of the Company, or otherwise interfere with or
disrupt the employment relationship between the Company and
any employee, (ii) solicit or do business with (a) the
Company's customers with whom the Company did business while
Executive was employed under this Agreement or (b) individuals
or entities whom Executive met as a result of his position
with the Company while Executive was employed under this
-9-
10
Agreement, that results in competition with the Company, or
(iii) be associated in any way with any entity doing business
in a 100-mile radius of New York City that competes with the
Company; provided, however, that the foregoing restrictions
shall not apply in any way to Executive's interest in Izzy
Entertainment, a company in the business of producing and
distributing popular music.
d. Executive expressly recognizes and agrees that the restraints
imposed by this Section 6 are (i) reasonable as to time,
geographic limitation and scope of activity to be restrained;
(ii) reasonably necessary to the enjoyment by the Company for
the value of its assets and to protect its legitimate
interests; and (iii) not oppressive. Executive further
expressly recognizes and agrees that the restraints imposed by
this Section 6 represent a reasonable and necessary
restriction for the protection of the legitimate interests of
the Company, that the failure by Executive to observe and
comply with the covenants and agreements in this Section 6
will cause irreparable harm to the Company, that it is and
will continue to be difficult to ascertain the harm and
damages to the Company that such a failure by Executive would
cause, that the consideration received by Executive for
entering into these covenants and agreements is fair, that the
covenants and agreements and their enforcement will not
deprive Executive of his ability to earn a reasonable living
in the Company's industry or otherwise, and that Executive has
acquired knowledge and skills in his field that will allow him
to obtain employment without violating these covenants and
agreements.
7. Indemnification.
a. The Company agrees that if Executive is or becomes a party, or
is threatened to be made party, to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal,
administrative or investigative and wether brought by or in
the right of the Company or otherwise ("Proceeding"), by
reason of the fact that (whether before or after the Effective
Date) he is or was a director, officer or employee of the
Company or is or was serving at the request of the Company as
a director, officer, member, employee or agent of another
corporation, partnership, joint venture, trust or other
enterprise, including (without limitation) service with
respect to employee benefit plans, whether or not the basis of
such Proceeding is Executive's alleged action in an official
capacity while serving as a director, officer, member,
employee or agent, Executive shall be indemnified and held
harmless by the Company to the fullest extent legally
permitted or authorized by the Company's certificate or
articles of incorporation or by-laws (or other applicable
governing documents) or resolutions of the Board (or other
applicable governing body) or the stockholders of the Company
or, if greater, by the laws of the State of Delaware or any
other applicable state or organization or formation, against
all cost, expense, liability and loss (including, without
limitation,
-10-
11
attorneys' fees, judgments, costs of appeal, fines, excise
taxes or penalties and amounts paid or to be paid in
settlement) reasonably incurred or suffered by Executive in
connection therewith, and such indemnification shall continue
as to Executive event if he has ceased to be a director,
member, employee or agent of the Company or other entity and
shall inure to the benefit of Employee's heirs, executors and
administrators. In this Section 7, (i) each reference to "the
Company" (other than for the purpose of any notice) shall
include, without limitation, all entities that are
subsidiaries and affiliates of the Company, and (ii) all
obligations of the Company shall be joint and several as to
all entities included in such definition of "the Company". The
Company shall pay or provide such indemnification to Executive
in connection with a Proceeding within sixty (60) days after
written request by Executive for that indemnification. During
that sixty (60) day period, Executive shall have an
opportunity to be heard and to present evidence in connection
with the consideration by the Board of Directors, independent
legal counsel, or stockholders, as the case may be, of any
findings required by applicable law in connection with that
indemnification request. The Company shall also advance to
Executive all reasonable costs and expenses incurred by him
(including, without limitation, all reasonable fees and costs
of counsel selected by Executive, and all other indemnifiable
liabilities covered by this Section 7(a)) in connection with a
Proceeding within thirty (30) days after written request by
Executive for such advance. Such request shall include an
undertaking by Executive to repay the amount of such advance
if it shall ultimately be determined that he is not entitled
to be indemnified against such costs and expenses. In the
event the Company does not properly indemnify or advance
expenses to Executive in accordance with the terms of this
Section 7(a)(including, without limitation, the time period
set forth above), Executive shall be entitled to bring an
action or proceeding against the Company in any state or
federal court or before a panel of arbitrators in accordance
with Section 20 hereof, to enforce the Company's
indemnification or expense-advancement obligations, and (in
either case) Executive shall be reimbursed by the Company for
the reasonable costs and expenses (including, without
limitation, reasonable attorneys fees and costs) of any
successful enforcement of the Company's indemnification or
expense-advancement obligations.
b. Neither the failure of the Company (including, without
limitation, its board of directors, independent legal counsel
or stockholders) to have made any determination that
indemnification of Executive is proper because he has met the
applicable standard of conduct, nor a determination by the
Company (including, without limitation, its board of
directors, independent legal counsel or stockholders) that
Executive has not met such applicable standard of conduct,
shall create a presumption that Executive has not met the
applicable standard of conduct or shall be a defense to any
action or proceeding to enforce the Company's indemnification
or expense-advancement obligations. The Company
-11-
12
shall have the burden of proof in establishing that Executive
has not met the applicable standard of conduct. Where
Executive is entitled to indemnification under this Section 7
for a portion of the indemnifiable liabilities described in
Section 7(a), but not for the total amount of liabilities of
that kind, the Company shall nevertheless indemnify Executive
for such portion of the indemnifiable liabilities to which
Executive is entitled.
c. Executive's rights provided in this Section 7 shall not be
exclusive of any other rights of indemnification or
advancement of expenses (or any similar rights) that Executive
may have against the Company or under any liability insurance
covering Executive.
d. The Company agrees to continue and maintain one or more
directors' and officers' liability insurance policies that
cover Executive (with reputable and financially sound
insurers) at a level that is commercially reasonable (in light
of the Company's business and the risks of litigation or
claims), and otherwise to the fullest extent the Company
provides such coverage for any of its other executive
officers.
e. Without limiting the generality of Section 7 hereof, the
rights of indemnity and advancement of expenses in favor of
Executive in this Section 7 shall continue and survive any
expiration or termination of this Agreement or Executive's
ceasing to be a director, officer, or employee of the Company.
8. Assignability; Binding Nature.
This Agreement shall be binding and inure to the benefit of the parties
and their respective successors, heirs (in the case of Executive) and permitted
assigns. No rights or obligations of the Company under this Agreement may be
assigned or transferred by the Company (including, without limitation, by
merger, consolidation, or other operation of law) except that such rights or
obligations may be assigned or transferred pursuant to a merger or consolidation
in which the Company is not the continuing or surviving entity, or the sale or
liquidation of all or substantially all of the assets of the Company,, to one or
more entities that have the financial and other ability to perform the Company's
obligations under this Agreement; provided, however, that the assignee or
transferee is the successor to all or substantially all of the assets of the
Company and such assignee or transferee assumes the liabilities, obligations and
duties of the Company under this Agreement, either contractually or as a matter
of law. No rights or obligations of Executive under this Agreement may be
assigned or transferred by Executive other than his rights to compensation and
benefits, as provided in Section 15 below.
9. Representations.
The Company represents and warrants that it is fully authorized and
empowered to enter
-12-
13
into this Agreement and that the performance of its obligations under this
Agreement will not violate any agreement between it and any other person, firm
or organization. Executive represents that he knows of no agreement between him
and any other person, firm or organization that would be violated by the
performance of his obligations under this Agreement.
10. Warranty.
Executive does hereby warrant that he has not taken any action, and
covenants that during the Agreement Term, or the Restricted Period, as
applicable, he shall take no such action, that constitutes or will constitute a
breach of any agreement concerning confidential information and trade secrets,
confidentiality, solicitation or non-competition to which he is bound as a
party.
11. Entire Agreement.
This Agreement and the other agreements referenced herein contain the
entire understanding and agreement between the parties concerning the subject
matter hereof and supersede all prior agreements, understandings, discussions,
negotiations and undertakings, whether written or oral, between the parties with
respect thereto. Nothing in this Agreement impairs or otherwise adversely
affects any of Executive's rights to or under any stock option or stock
agreements with the Company (or any of its subsidiaries or affiliates) that are
in effect on or after the Effective Date.
12. Amendment or Waiver.
No provision of this Agreement may be amended unless such amendment is
agreed to in writing and signed by Executive and an authorized officer of the
Company (other than Executive). No waiver by either party of any breach by the
other part of any condition or provision contained in this Agreement to be
performed by such other party shall be deemed a waiver of a similar or
dissimilar condition or provision at the same or any prior or subsequent time.
Any waiver must be in writing and signed by Executive or an authorized officer
of the Company (other than Executive), as the case may be.
13. Severability.
In the event that any provision or portion of this Agreement shall be
determined to be invalid or unenforceable for any reason, in whole or in part,
the remaining provisions of this Agreement shall be unaffected thereby and shall
remain in full force and effect to the fullest extent permitted by law.
14. Survivorship.
The respective rights and obligations of the parties hereunder shall
survive any termination of the Executive's employment or the expiration of the
Agreement Term to the
-13-
14
extent necessary to the intended preservation of such rights and obligations.
15. Beneficiaries/References.
Executive shall be entitled, to the extent permitted under any
applicable law, to select and change a beneficiary or beneficiaries to receive
any compensation or benefit payable hereunder following Executive's death or
incompetence by giving the Company written notice thereof. In the event of
Executive's death or a judicial determination of his incompetence, reference in
this Agreement to Executive shall be deemed, where appropriate, to refer to his
beneficiary, estate or other legal representative.
16. Governing Law/Jurisdiction.
This Agreement shall be governed by and construed and interpreted in
accordance with the laws of New York without reference to principles of conflict
of laws.
17. Resolution of Disputes.
a. Arbitration of Claims. Any disputes arising under or in
connection with this Agreement shall be resolved by binding
arbitration. Such arbitration shall be conducted on an
expedited basis in accordance with the Commercial Arbitration
Rules of the American Arbitration Association before a panel
of three (3) arbitrators, selected by the American Arbitration
Association, sitting in New York, New York. The award of the
arbitrators shall be final and nonappealable, and judgment may
be entered on the award of the arbitrators in any court having
proper jurisdiction. All expenses of such arbitration shall be
borne by Company.
b. Payment of Legal Fees and Costs. The Company agrees to pay as
incurred, to the full extent permitted by law, all legal fees
and expenses which Executive may reasonably incur as a result
of any contest (regardless of the outcome thereof) by the
Company, Executive or others of any action taken pursuant to
the terms of this Agreement, or of the validity or
enforceability of, or liability under, any provision of this
Agreement, or any guarantee of performance thereof (including,
without limitation, as a result of any contest by Executive
about the amount of payment pursuant to the Agreement), plus
in each case interest on any delayed payment at the AFR.
18. Notices.
Any notice given to a party shall be in writing and shall be deemed to
have been given when delivered personally or by courier, or upon receipt if sent
by certified or registered mail, postage prepaid, return receipt requested, duly
addressed to the party concerned at the address indicated below or to such
changed address as such party may subsequently given such notice of:
-14-
15
If to the Executive: Select Media Communications, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxxx, President
With a Copy to
(which shall not XxXxxxxxx Will & Xxxxx
constitute notice): 00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx, Esquire
If to Company:
19. Headings.
The headings of the sections contained in this Agreement are for
convenience only and shall not be deemed to control or affect the meaning or
construction of any provision of this Agreement.
20. Counterparts.
This Agreement may be executed in two or more counterparts.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first written above.
SELECT MEDIA COMMUNICATIONS, INC.
------------------------------------------
By:
Its:
------------------------------------------
XXXXX X. XXXXXXXXX
-15-
