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EXHIBIT 10.6
EMPLOYMENT AGREEMENT
OF XXXXXX X. XXXXX
This EMPLOYMENT AGREEMENT (this "AGREEMENT") is made as of April 1, 200
by and BETWEEN XX.XXX, a California corporation ("EMPLOYER"), and XXXXXX X.
XXXXX ("EXECUTIVE").
RECITALS
A. EMPLOYER
Employer is a company building a business of developing and selling
solutions and services relating to mobile Internet applications.
B. EXECUTIVE
Executive has developed substantial expertise in law and finance.
C. INTENTIONS
Employer intends to engage Executive and Executive intends to accept
employment from Employer on the terms and conditions of this Agreement.
AGREEMENT
In consideration of the foregoing and of the mutual covenants and
conditions herein contained, the parties hereby agree as follows:
1. EMPLOYMENT. Employer hereby employs Executive as Chief Financial
Officer, and Executive accepts such employment, upon the terms and subject to
the conditions set forth in this Agreement.
2. TERM. The term of this Agreement shall be for a period commencing
upon date hereof and ending on March 31, 2002 ("INITIAL TERM"). The period of
time between the commencement of the term of this Agreement and termination of
Executive's employment shall be referred to herein as the "EMPLOYMENT PERIOD."
3. POSITION AND SERVICES
3.1 BEST EFFORTS. Executive will occupy the position of Chief
Financial Officer of Employer. During the Employment Period, Executive will
devote his best efforts and substantially all of his business time and attention
to the performance of his duties hereunder and to the business and affairs of
Employer, except for vacation periods as set forth herein and reasonable periods
of illness or other incapacities permitted by Employer's general employment
policies.
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3.2 DUTIES. Executive shall perform such duties as are
customarily associated with his position, consistent with the Bylaws of Employer
and as required by Employer's Board of Directors ("BOARD").
3.3 PLACE OF EMPLOYMENT. For at least the first 3 months of
employment, Executive will be temporarily based at Employees office in
Reykjavik, Iceland. Thereafter, Executive may choose his place of employment
from among Boston, London, Reykjavik, Stockholm, and any additional location
approved by Employer. Employer shall provide Executive with a work authorization
at his place of employment where such authorization is needed. Employer shall
assist Executive in compliance with all immigration laws and shall pay the
reasonable costs of such compliance, specifically including attorneys' fees.
Executive's base salary shall be adjusted upward to reflect any additional
taxation and other cost of living increases associated with the relocation. The
amount of increase will be determined by any applicable CPI (Consumer Price
Index) or other valid indicator generally relied upon by industry or agreed upon
by Employer and Executive.
3.4 COMPANY POLICIES. The employment relationship between the
parties shall be governed by the general employment policies and practices of
Employer, including but not limited to those relating to protection of
confidential information and assignment of inventions, except that when the
terms of this Agreement differ from or are in conflict with Employer's general
employment policies or practices, this Agreement shall control. Executive will
duly, punctually and faithfully observe Employer's general employment policies
and practices, including, without limitation, any and all rules, regulations,
policies and/or procedures which Employer may now or hereafter establish
governing the conduct of its business.
4. COMPENSATION
4.1 SALARY. During the Initial Period, Employer shall pay to
Executive base salary at the annual rate of $250,000. Executive's salary shall
increase March 31, 2001 by the sum of (i) an amount equal to no less than five
percent (5%) and (ii) the percentage increase in the general Consumer Price
Index for the geographic area in which Executive is employed from January 1,
2000 to January 1, 2001. Executive's salary shall be payable at the same time
and basis as Employer pays its payroll in general. For calendar year 2000, and
for any other period during which Executive is domiciled and his services are
rendered substantially in the United States, payment of Executive's salary shall
be paid in U.S. dollars and subject to deductions for social security, federal
and state payroll taxes and unemployment and other standard deductions and
withholdings, otherwise Executive's salary shall be paid in the currency of the
country in which he is domiciled and his salary shall be subject to all
applicable local withholding requirements.
4.2 STOCK OPTION GRANTS. Executive shall be granted an incentive
stock option to purchase up to 200,000 shares of Employer's common stock under
the terms of the OZ Interactive, Inc. 1995 Stock Option Plan ("Stock Option
Plan"), as amended. These options will be due and exercisable in eight equal
quarterly installments, the first being vested and exercisable June 30, 2000 and
at the end of each calendar quarter thereafter until fully vested.
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4.3 PARTICIPATION IN BENEFIT PLANS. During the term hereof,
Executive shall be entitled to participate in any profitsharing, group
insurance, hospitalization, medical, dental, health and accident, disability or
similar plan or program of Employer now existing or established hereafter for
executives.
4.4 VACATION. Executive shall be entitled to a period of annual
vacation time equal to that provided to employees of equal position by
Employer's policies and procedures regarding vacation, but in no event less than
five weeks per year (including one week off between Christmas and New Years Day
during which the offices of Employer will be closed). The days selected for
Executive's vacation must be mutually agreeable to Employer and Executive.
4.5 EXECUTIVE BONUS PROGRAM. Executive shall be eligible for and
a full participant in an executive and/or personal bonus program that will
reward him for successfully closing an IPO, increasing shareholder value through
increases in the stock price, and successfully closing strategic acquisitions or
other major accomplishments within his full or partial control as Chief
Financial Officer of the Employer. In the event no such plan is adopted,
approved or implemented by the Board of Directors or the Compensation Committee
thereof, Executive shall receive an annual cash bonus, which shall not exceed
one hundred percent (100%) of his base salary for such period. The bonus shall
be determined in accordance with the following formula, which shall be
calculated no later than March 31 of the year following the year for which the
bonus is to be calculated:
2000: 2.5% of any net revenues in excess of 1999 net revenues.
2001: 2.5% of any net revenues in excess of 2000 net revenues.
4.6 EXPATRIATION BENEFITS. Employee will provide an expatriation
package with the intention of making the relocation economically neutral to
Executive from the point of view of cost of living and tax burdens as compared
with Orange County, California, and paying personal expenses (i.e., business
class travel for Executive and his family and personal phone expenses)
reasonably related to the displacement of Executive and his family from their
home, family and friends. Employer understands that this will include require
frequent travel by members of Executive's nuclear family back to California to
visit Executive parents in law and grandmother.
4.7 ACCOMMODATION EXPENSES/CAR ALLOWANCE. Employer will, during
the term of this Agreement, bear reasonable expenses of Executive and his family
for accommodation at the place (or places, if Executive is expected to spend
significant time in more than one location) of employment of Executive.
Reasonable accommodation shall mean housing similar to Executive's home in
California within a reasonable commute from Employer's facilities and/or an
acceptable English-language school in the place of employment of Executive.
Employer will furthermore provide a vehicle for Executive's use equivalent to a
Volvo S-80, T6.
5. DEATH OR DISABILITY DURING EMPLOYMENT. If Executive is prevented from
performing duties hereunder by reason of illness or injury for (i) a period of
six (6) or more consecutive months or (ii) more than 180 days in any consecutive
twelve month period (the date of the determination of disability under clause
(i) or (ii) shall be referred to as the "EFFECTIVE DATE OF DISABILITY"), or if
Executive dies during employment hereunder,
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Employer shall pay to the Executive if disabled (or in the case of death to the
executors under Executive's last will and testament), the salary that would
otherwise be payable to the Executive under this Agreement through the end of
the six (6) month following the month in which the Executive's Effective Date of
Disability or death occurs, as the case may be. Such payments shall constitute
all of Employer's obligations to Executive in the event of Executive's death or
disability, and all compensation and benefits, except benefits provided by law
(e.g., COBRA health insurance continuation benefits), shall otherwise cease to
accrue. The determination regarding whether Executive is unable to perform
duties hereunder shall be made by Employer's Board of Directors in the
reasonable, good faith exercise of its judgment.
6. TERMINATION. This Agreement does not grant Executive any right or
entitlement to be retained by the Employer, and shall not affect or prejudice
Employer's right to discharge the Executive in accordance herewith with or
without cause.
6.1 TERMINATION WITHOUT CAUSE. Employer's Board may terminate
Executive's employment with Employer at any time, upon thirty days' written
notice, without "CAUSE," as defined below. In the event Executive's employment
is terminated without cause, Executive shall be entitled to the payment in full
of all salary and benefits to which Executive would otherwise have been entitled
pursuant to Section 4 of this Agreement, including a pro rated portion of any
bonus for which he would have otherwise been eligible under any executive bonus
program. Such salary and benefits shall constitute the entirety of Employer's
obligations to Executive in the event of the termination of Executive's
employment without cause, except benefits provided by law (e.g., COBRA health
insurance continuation benefits). All salary payable under this Section shall be
paid at the same time and basis as Employer pays its payroll in general.
6.2 TERMINATION WITH CAUSE. Employer's Board may terminate
Executive's employment with Employer at any time for cause, immediately upon
notice to Executive of the circumstances leading to such termination for cause.
In the event that Executive's employment is terminated for cause, all
compensation and benefits, except benefits provided by law (e.g., COBRA health
insurance continuation benefits), will immediately cease to accrue, and all
compensation and, except as otherwise required by applicable law, benefits
accrued though the date of termination shall be paid to Executive within a
reasonable time thereafter but in no event later than thirty days. The date of
termination shall be the date upon which notice of termination is given.
Employer shall have no further obligation to pay severance of any kind nor to
make any payment in lieu of notice.
6.3 DEFINITION OF CAUSE. For the purposes of this Agreement,
"CAUSE" shall mean: (a) habitual neglect or insubordination (defined as a
refusal to execute or carry out directions from the Board); (b) conviction of
any felony or any crime involving moral turpitude; (c) willful breach of
Executive's duties to Employer and (d) conduct by Executive, which in the good
faith, reasonable determination of the Board demonstrates gross unfitness to
serve, including but not limited to gross neglect, non-prescription use of
controlled substances, any abuse of controlled substances whether or not by
prescription, or habitual drunkenness, intoxication, or other impaired state
induced by consumption of any drug, including alcohol. [My "cause" too.]
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7. ARBITRATION OF DISPUTES
7.1 CHOICE OF ARBITRATION. Any and all disputes or
controversies, whether of law or fact of any nature whatsoever, arising from or
respecting this Agreement shall be decided in accordance with the then current
arbitration rules of the International Chamber of Commerce ("ICC") or by any
other body mutually agreed upon by the parties. Pre-arbitration discovery shall
be permitted at the request of either party under appropriate protection for
proprietary and confidential business information. If any terms in this Section
15 are inconsistent with the rules of the ICC in effect at the time of the
dispute, then the rules of the ICC shall prevail.
7.2 NOTICE AND ATTEMPTS TO RESOLVE. Before filing a demand for
arbitration, a party must send the other party written notice identifying the
matter in dispute and invoking the procedures in this paragraph. Such written
notice shall be sent promptly after the party knew or reasonably should have
known of an alleged violation of this Agreement. Within fifteen days after such
written notice is given, one or more principals of each party shall meet at a
mutually agreeable location, for the purpose of determining whether they can
resolve the dispute themselves by written agreement. If the parties fail to
resolve the dispute by written agreement within the fifteen-day period, the
complaining party may then initiate the arbitration process by filing a demand
with the ICC or such other body as the parties may agree upon. Nothing in this
paragraph shall prevent a party from seeking temporary equitable relief, from
ICC or such other body as the parties may mutually agree upon, during the
fifteen-day period if necessary to prevent irreparable harm.
7.3 NUMBER OF ARBITRATORS. There shall be three arbitrators to
be chosen in accordance with the then current ICC rules for selecting
arbitrators. Either party may disqualify any individual arbitrator who is a
present or past employee, owner, or consultant to the opposing party or a
competing organization.
7.4 LOCATION AND PROCEDURES. The place of arbitration shall be a
location mutually agreed upon by the parties. At the request of either party,
arbitration proceedings will be conducted in the utmost secrecy and, in such
case, all documents, testimony and records shall be received, heard and
maintained by the arbitrators in secrecy under seal, available for inspection
only by Executive and Employer, their respective attorneys, and their respective
experts, consultants or witnesses who shall agree, in advance and in writing, to
receive all such information confidentially and to maintain such information in
secrecy, and make no use of such information except for the purposes of the
arbitration, until such information shall become generally known.
7.5 POWER OF ARBITRATORS. The arbitrators, who shall act by
majority vote, shall be able to decree any and all relief of an equitable
nature, including but not limited to such relief as a temporary restraining
order, a temporary injunction, or a permanent injunction, and shall also be able
to award damages, with or without an accounting and costs. The decree or
judgment of an award rendered by the arbitrators may be entered in any court
having jurisdiction over the parties.
7.6 RIGHTS OF PREVAILING PARTIES. If any action is necessary to
enforce or interpret the terms of this Section 7, the prevailing party shall be
entitled to reasonable attorneys' fees, costs, and necessary disbursements in
addition to any other relief to which that party may be entitled.
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8. MISCELLANEOUS
8.1 BREACH OR VIOLATION OF AGREEMENT. The parties agree that a
breach or violation of this Agreement will result in immediate and irreparable
injury and harm to the innocent party, who shall have, in addition to any and
all remedies of law, the right to an injunction, specific performance or other
equitable relief to prevent the violation of the obligations hereunder, plus
reasonable attorneys' fees and costs incurred in obtaining any such relief.
8.2 NOTICES. Any notice required to be given pursuant to the
provisions of this Agreement shall be in writing and, if mailed, sent by
registered or certified mail, postage prepaid, or by an overnight delivery
service, to the party named at the address set forth below, or at such other
address as each party may hereafter designate in writing to the other party:
Employer: XX.XXX
Xxxxxxxxxxx 00
000 Xxxxxxxx, Xxxxxxx
with a copy to: Xxxxxx Xxxxxxxxxx, Esq.
Xxxxxxxxxxx 00
000 Xxxxxxxxx, Xxxxxxx
Executive: Xxxxxx X. Xxxxx
00000 Xxx Xxxxxx
Xxxxxx, XX 00000
Any such notices shall be deemed to have been delivered when served personally
(including personal delivery by telecopy), in five business days after being
mailed by registered or certified mail, or in two business days after being
mailed by an overnight delivery service.
8.3 ENTIRE AGREEMENT. This Agreement and that certain
Proprietary Information and Inventions Agreement by and between Executive and
Employer of even date herewith supersede all prior discussions, negotiations and
agreements between the parties with respect to the subject matter, or otherwise
in consideration hereof, and reflects their entire agreement.
8.4 CHANGE, MODIFICATION, WAIVER. No change or modification of
this Agreement shall be valid unless it is in writing and signed by each of the
parties hereto. No waiver of any provision of this Agreement shall be valid
unless it is in writing and signed by the party against whom the waiver is
sought to be enforced. The failure of a party to insist upon strict performance
of any provision of this Agreement in any one or more instances shall not be
construed as a waiver or relinquishment of the right to insist upon strict
compliance with such provision in the future.
8.5 SEVERABILITY OF PROVISIONS. Whenever possible, each
provision of this Agreement will be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this Agreement
is held to be invalid, illegal or unenforceable in any respect under any
applicable law or rule in any jurisdiction, such invalidity, illegality or
unenforceability will not affect any other provision, but this Agreement will be
reformed,
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construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provisions had never been contained herein.
8.6 SUCCESSORS AND ASSIGNS. The services and duties to be
performed by Executive hereunder are personal and may not be assigned. This
Agreement shall be binding upon and inure to the benefit of Employer its
successors and assigns, and Executive, his heirs and representatives. This
Agreement shall be assignable by Employer to any successor entity to Employer,
or any entity controlled by or under common control with Employer. This
Agreement shall also inure to the benefit of Ericsson Inc., which shall be a
third-party beneficiary to this Agreement.
8.7 ATTORNEYS FEES. If any legal proceeding is necessary to
enforce or interpret the terms of this Agreement, or to recover damages for
breach therefore, the prevailing party shall be entitled to reasonable
attorneys' fees, as well as costs and disbursements, in addition to any other
relief to which he or it may be entitled.
8.8 FORM. As used in this Agreement, the singular form shall
include, if appropriate, the plural.
8.9 HEADINGS. The headings used in this Agreement are solely for
the convenience and reference of the parties and are not intended to be
descriptive of the entire contents of any paragraph and shall not limit or
otherwise affect any of terms, provisions, or constructions thereof.
8.10 DRAFTING AND CONSTRUCTION. This Agreement shall be
interpreted as if the parties jointly and equally drafted it and any doctrine of
law that might operate to construe any ambiguity against the drafter shall be
inapplicable to this Agreement. The section and paragraph headings in this
Agreement are solely for reference purposes and shall not affect in any way the
meaning or interpretation of this Agreement.
IN WITNESS WHEREOF, this Agreement is executed as of the date first
above written.
XX.XXX
By: /s/ XXXXX XXXXXXXX
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/s/ XXXXXX X. XXXXX
-------------------------------- ---------------------------
For the Board of Directors XXXXXX X. XXXXX
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