EXHIBIT 10.4
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is made as of JULY 3,
2000, between Xxxxxxxxx.xxx, Inc. (the "Company"), and Xxxxxxx Xxxxxxx
("Xxxxxxx"). In consideration of the terms and conditions herein, the parties
agree as follows:
ARTICLE 1
GENERAL PROVISIONS
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Section 1.01. TERM. Xx. Xxxxxxx'x employment pursuant to this Agreement
shall commence on July 3, 2000 and continue for a period of three (3) years
ending July 3, 2003.
Section 1.02. PROBATIONARY PERIOD. Xx. Xxxxxxx shall be subject to a
90-day probationary period, during which time the Company shall carefully
evaluate his performance and potential to determine whether his qualifications
are commensurate with his duties.
Section 1.03. TERMINATION AT WILL. Xx. Xxxxxxx'x employment pursuant to
this Agreement shall constitute employment which is terminable at will by either
Xx. Xxxxxxx or the Company, with or without cause or reason, and without advance
notice or any pay in lieu of advance notice. Notwithstanding the foregoing, if
Xx. Xxxxxxx'x employment is terminated, he shall be entitled to a Sixty Thousand
Dollar($60,000) severance bonus, payable in two (2) equal monthly installments
following the effective date of termination, unless the termination is due to
the following:
1.03.1 Xx. Xxxxxxx breaches or neglects the duties that he is required
to perform or otherwise fails to use ordinary and reasonable care in
the performance of his duties under the terms of this Agreement;
1.03.2 Xx. Xxxxxxx becomes mentally or physically incapacitated or
disabled so that he will not be able to perform his duties under this
Agreement for a period of three (3) months from the commencement of
such incapacity;
1.03.3 Xx. Xxxxxxx dies;
1.03.4 During Xx. Xxxxxxx'x employment with the Company, he is
convicted of a felony involving moral turpitude;
1.03.5 The company becomes insolvent, makes an assignment for the
benefit of creditors, files for or has filed against it a petition in
bankruptcy, or otherwise ceases to operate.
Section 1.04. TERMINATION OBLIGATIONS: RETURN OF COMPANY PROPERTY. Upon
termination of this Agreement, Xx. Xxxxxxx shall promptly return all Company
property in his possession.
ARTICLE 2
POSITION AND DUTIES; OTHER BUSINESS ACTIVITIES
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Section 2.01. POSITION. Xx. Xxxxxxx'x position shall be the Chief
Financial Officer for the Company. Xx. Xxxxxxx hereby agrees to perform such
services and accepts such employment upon the terms and conditions herein set
forth. Within Xx. Xxxxxxx'x first year of employment, the Company will review
him for a potential seat on the Company's Board of Directors.
Section 2.02. DUTIES. Xx. Xxxxxxx shall perform such services for the
Company as may be assigned by the Company, its Board of Directors and/or
Executive Officers which reasonably serve the purpose of this Agreement and/or
meet the needs of Company.
Section 2.03. FULL ATTENTION TO BUSINESS. With the exception of
performing limited duties for Allstate Communications, Inc. or its affiliates,
during said employment, Xx. Xxxxxxx shall devote his full business time,
energies, interest abilities and productive efforts to the business of the
Company and its affiliates or subsidiaries. Xx. Xxxxxxx shall not engage in any
activity which conflicts or interferes with his performance of duties hereunder.
Section 2.04. COVENANT NOT TO COMPETE DURING TERM. During said
employment, Xx. Xxxxxxx shall comply in all respects with the Company's policies
with respect to conflicts of interest. Xx. Xxxxxxx shall not, without the prior
written consent of the President of the Company, engage in or be interested,
directly or indirectly, in any business or operation competitive with the
Company or any of Company's related or affiliated companies. For the purpose of
this paragraph, Xx. Xxxxxxx shall be deemed to be interested in a business or
operation which is competitive with the Company if Xx. Xxxxxxx is interested in
such business or operation as a stockholder, director, officer, employee, agent,
partner, individual proprietor, lender, consultant, or independent contractor,
excluding publicly traded companies.
Section 2.05. NON-DISCLOSURE OF CONFIDENTIAL INFORMATION. Xx. Xxxxxxx
acknowledges that in connection with this Agreement and his performance
hereunder, he may acquire or learn "Confidential Information" of the Company by
virtue of a relationship of trust and confidence between Xx. Xxxxxxx and the
Company. Xx. Xxxxxxx warrants and agrees that during his said employment he
shall not disclose to anyone (other than to officers of Company or to such other
persons as such officers may designate), or use, except in the course of his
employment, any Confidential
Information acquired by his in the course of or in connection with his
employment. As used herein, the term "Confidential Information" shall include,
but not be limited to: all information of any type or kind, whether or not
reduced to a writing and whether or not conceived, originated, discovered or
developed in whole or in part by Xx. Xxxxxxx, which is directly related to
Company, its operations, policies, agreements with third parties, its financial
affairs and related matters, including business plans, strategic planning
information, product information, purchase and sales information and terms,
supplier negotiation points, styles and strategies, contents and terms of
contracts between the Company and suppliers, advertisers, vendors, contact
persons, terms of supplier and/or vendor contracts or particular transactions,
potential suppliers and/or vendors, or other related data; marketing information
such as but not limited to, prior, ongoing or proposed marketing programs,
presentations, or agreements by or on behalf of the Company, pricing
information, customer bonus programs, marketing tests and/or results of
marketing efforts, computer files, lists and reports, manuals and memos
pertaining to the business of the Company, lists or compilations of vendor
and/or supplier names, addresses, phone numbers, requirements and descriptions,
contract information sheets, compensation requirements or terms, benefits,
policies, and any other financial information whether about the Company,
entities related or affiliated with the Company or other key information
pertaining to the business of the Company, including but not limited to all
information which is not generally available to or known in the information
services industry (or is available only as a result of an unauthorized
disclosure) and is treated by the Company as "Confidential Information" during
the term of this Agreement, regardless of whether or not such Information is a
"trade secret" as otherwise defined by applicable law.
Section 2.06. NO SOLICITATION OF EMPLOYEES. Xx. Xxxxxxx specifically
agrees that during his said employment, and for a period of two (2) years after
his termination of employment with the Company, Xx. Xxxxxxx shall not, directly
or indirectly, either for himself or for any other person, firm, corporation or
legal entity, solicit any individual then employed by the Company to leave the
employment of the Company.
Section 2.07. OWNERSHIP OF WORK PRODUCT AND IDEAS. During Xx. Xxxxxxx'x
said employment, any discoveries, inventions, patents, materials, licenses and
ideas relating to Xx. Xxxxxxx'x services hereunder, whether or not patentable or
copyrightable and whether created by Employee during the term of this Agreement
or owned by the Company prior to or alter the execution of this Agreement ("Work
Product") and all business opportunities within the industry ("Opportunities")
introduced to Xx. Xxxxxxx by Company will be owned by the Company, and Xx.
Xxxxxxx will have no personal interest in such, except to the extent that Xx.
Xxxxxxx invests in the same or the Company allows Xx. Xxxxxxx to participate in
or have other rights to such Work Product or Opportunities during the term
hereof or upon the termination of this Agreement. Xx. Xxxxxxx will, in such
connection, promptly disclose any such Work Product and Opportunities to the
Company and, upon request of the Company, will
assign to the Company all right in such Work Product and Opportunities.
ARTICLE 3
COMPENSATION; BENEFITS
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Section 3.01. SALARY. The Company shall pay Xx. Xxxxxxx Seven Thousand
Five Hundred Dollars ($7,500.00) on a semi-monthly basis, for an annualized base
salary of One Hundred Sixty Thousand Dollars ($180,000.00). Xx. Xxxxxxx shall be
eligible for cost of living and merit increases.
Section 3.02. BONUS. Xx. Xxxxxxx shall be eligible for a discretionary
performance bonus.
Section 3.03. PAID VACATION. Xx. Xxxxxxx shall be entitled to two weeks
of paid vacation for the first year of service, three weeks of paid vacation for
the second through fifth years of service, and four weeks of paid vacation each
year thereafter.
Section 3.04. STOCK OPTION PLAN ELIGIBILITY. Xx. Xxxxxxx shall be
granted options, in accordance with the Company's Stock Option Agreement, on a
total of Nine Hundred Thousand (900,000) common shares of the company (AMEX:
SPO) according to the following vesting schedule:
150,000 shares Issued 120 days after employment begins at the July
3, 2000 closing bid.
The following options will be issued at an exercise price equal to the
July 3, 2000 closing bid:
175,000 shares Issued 6 months after employment begins;
250,000 shares Issued 12 months after employment begins; and
325,000 shares Issued 18 months after employment begins.
In addition, Xx. Xxxxxxx shall be eligible to receive options on
additional common shares of the Company on an annual basis, pursuant to the
Company's Incentive Stock Option Plan.
Section 3.05. OTHER BENEFITS. During the term of this Agreement, and
subject to the terms and provisions of such plans or policies regarding
continuation rights, if any, Xx. Xxxxxxx shall be entitled to participate in
present and future employee benefit plans which are available to the Company's
employees of similar rank and title, subject to eligibility requirements
thereunder; provided, however, the Company reserves the
right to modify or terminate such benefits at any time, without notice, and
without further recourse by Xx. Xxxxxxx.
Section 3.06 EXPENSES. Xx. Xxxxxxx shall be reimbursed for all normal
business expenses incurred, including first class air travel, for travel and
entertainment during the course of employment.
ARTICLE 4
MISCELLANEOUS PROVISIONS
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Section 4.01. ENTIRE AGREEMENT. This Agreement contains the entire
Agreement between the Parties and supersedes all prior oral and written
Agreements, understandings, commitments, or practices between the Parties. Other
than as expressly set forth herein, Xx. Xxxxxxx and the Company acknowledge and
represent that there are no other promises, terms, conditions or representations
(verbal or written) regarding any matter relevant hereto. No supplement,
modification, or amendment of any term, provision or condition of this Agreement
shall he binding or enforceable unless evidenced in writing and executed by the
Parties.
Section 4.02. APPLICABLE LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California, and the venue
of any litigation commenced hereunder shall be Los Angeles, California.
Section 4.03. INJUNCTIVE RELIEF. Xx. Xxxxxxx acknowledges that his
services ummitare of a special, unique, unusual, extraordinary and intellectual
character, which gives them a peculiar value, the loss of which cannot be
reasonably or adequately compensated in damages in an action at law. If he
should breach this Agreement, in addition to its rights and remedies under
general law, the Company shall be entitled to seek equitable relief by way of
injunction or otherwise.
Section 4.04. PARTIAL INVALIDITY. If the application of any provision
of this Agreement, or any section, subsection, subdivision, sentence, clause,
phrase, word or portion of this Agreement should be held invalid or
unenforceable, the remaining provisions thereof shall not be affected thereby,
but shall continue to be given full force and effect as if the invalid or
unenforceable provision had not been included herein.
Section 4.05. NOTICES. Notices given under this Agreement may be given
by registered or certified mail, return receipt requested, or by personal
delivery to the respective addresses of the Parties. For Xx. Xxxxxxx that
address shall be 00000 Xxxxxxxx Xx., Xxxxxxxxxx, Xx. 00000. For the Company, it
shall be addressed to Xx. Xxxxx Xxxxx, President, Xxxxxxxxx.xxx, 0000 00xx
Xxxxxx, Xxxxx Xxxxxx, Xxxxxxxxxx 00000. A mailed notice shall be deemed given
two (2) business day after mailing.
Section 4.06. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
shall constitute one and the same instrument.
Section 4.07. ASSIGNMENT. This Agreement may not be assigned or
encumbered in any way by Xx. Xxxxxxx. The Company may assign this Agreement to
any successor (whether by merger, consolidation, or purchase of the Company's
stock) to all or a controlling interest in the Company's business, in which case
this Agreement shall be binding upon and inure to the benefit of such
successor(s) and assign(s).
Section 4.08. LIMITATION ON WAIVER. A waiver of any term, provision or
condition of this Agreement shall not be deemed to be, or constitute a waiver of
any other term, provision or condition herein, whether or not similar. No waiver
shall be binding unless in writing and signed by the waiving party.
Section 4.09. ATTORNEYS' FEES. In the event that any proceeding is
commenced involving the interpretation or enforcement of the provisions of this
Agreement, the Party prevailing in such proceeding shall be entitled to recover
its reasonable costs and attorneys' fees.
Section 4.10. ARBITRATION. If a dispute or claim shall arise with
respect to any of the terms or provisions of this Agreement or with respect to
the performance by either of the parties under this Agreement, then either party
may, by notice as herein provided, require that the dispute be submitted under
the Commercial Arbitration Rules of the American Arbitration Association to an
arbitrator in good standing with the American Arbitration Association within
fifteen (15) days after such notice is given. The written decision of the single
arbitrator ultimately appointed by or for both parties
shall be binding and conclusive on the parties. Judgment may be entered on such
written decision by the single arbitrator in any court having jurisdiction and
the parties consent to the jurisdiction of the courts of the state of California
for this purpose. Any arbitration undertaken pursuant to the terms of this
section shall occur in the state of California.
Section 4.11. TAXES. Any income taxes required to be paid in connection
with the payments due hereunder shall be borne by the party required to make
such payment. Any withholding taxes in the nature of a tax on income shall be
deducted from payments due, and the party required to withhold such tax shall
furnish to the party receiving such payment all documentation necessary to prove
the proper amount to withhold of such taxes and to prove payment to the tax
authority of such required withholding.
Section 4.12. NOT FOR THE BENEFIT OF CREDITORS OR THIRD PARTIES. The
provisions of this Agreement are intended only for the regulation of relations
among the parties. This Agreement is not intended for the benefit of creditors
of the parties or other third parties and no rights are granted to creditors of
the parties or other third parties under this Agreement.
IN WITNESS WHEREOF, this Agreement is executed in Los Angeles,
California on the dates set forth below.
Dated: 7/3/00 /S/ Xxxxxxx Xxxxxxx
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Xxxxxxx Xxxxxxx
XXXXXXXXX.XXX, INC.
Dated: 7/3/00 /S/ Xxxxx Xxxxx
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Xxxxx Xxxxx
President and CEO
