Exhibit 10.15
XXXXXX COMMUNICATIONS, INC
XXXXXX X. XXXXXXX EMPLOYMENT AGREEMENT
This Agreement is made by and between Xxxxxx Communications (the "Company") and
Xxxxxx X. Xxxxxxx ("Employee") as of January 8th, 2001.
1) DUTIES AND SCOPE OF EMPLOYMENT
(a) Positions; Commencement Date; Duties
Employee's employment with the Company pursuant to this Agreement
shall commence on January 8th, 2001 (the "Commencement Date"). As of
the Commencement Date, the Company shall employ the Employee as Vice
President, International. The period of Employee's employment
hereunder is referred to herein as the "Employment Term." During the
Employment Term, Employee shall render such business and
professional services in the performance of his duties, consistent
with Employee's position within the Company, as shall reasonably be
assigned to him by the President of the Company (the "President") to
whom which the Employee will initially directly report Initial
duties of the Employee are delineated in the letter from the Company
dated December 22nd, 2000.
(b) Obligations
During the Employment Term, Employee shall devote his full business
efforts and time to the Company. Employee agrees, during the
Employment Term, not to actively engage in any other employment,
occupation or consulting activity for any direct or indirect
remuneration without the prior approval of the President; provided,
however, that Employee may serve in any capacity with any civic,
educational or charitable organization without the approval of the
President including obligations that have already been communicated
and agreed to in separate communication between Employee and the
Company dated December 25th and 27th, 2000, and as described more
fully on the attached Exhibit A. The Company also recognizes that
the Employee has a corporation registered in the State of Florida,
SeedVest, Inc., which he is the sole owner and intends to keep
registered due to outstanding investments and other past client
obligations, but will remain dormant with regards to any new
consulting work following the completion of work previously
communicated and describes as noted above.
2) EMPLOYEE BENEFITS
(a) General
During the Employment Term, Employee shall be eligible to
participate in the appropriate employee benefit plans and insurance
maintained by the Company that are applicable to other senior
management to the full extent provided for under those plans and
delineated in the abovementioned letter dated December 22nd, 2000.
Promptly following the date hereof, the Company shall provide
Employee with information regarding such plans and insurance. The
Company reserves the right to cancel or change its benefits plans
and programs it offers to its employees at any time.
3) AT-WILL EMPLOYMENT
Employee and the Company understand and acknowledge that Employee's
employment with the Company constitutes "at-will" employment.
Subject to the Company providing severance and "Change in Control"
benefits as specified herein, Employee and the Company acknowledge
that this employment relationship may be terminated at any time,
upon written notice to the other party, with or without good cause
or for any or no cause, at the option either of the Company or
Employee.
4) COMPENSATION
(a) Base Salary
While employed by the Company, the Company shall pay the
Employee as compensation for his services a base salary at the
annualized rate of $175,000 (the "Base Salary"). Such salary
shall be paid semi-monthly in accordance with normal Company
payroll practices and subject to the usual required
withholding and will be reviewed annually.
(b) Bonuses
(i) Target Bonus
Employee shall be eligible to receive an annual target bonus
of approximately $61,250 (at 100% of plan)(the "Bonus") paid
in quarterly installments. The actual amount of the Bonus will
be based upon the achievement of the criteria specified by the
President and calculated for Fiscal Year 2001 only as follows:
> 20% of base salary if 90% to 99% of Plan is
achieved
> 35% of base salary if 100% to 114% of Plan is
achieved
> 50% of base salary if 115% to 129% of Plan is
achieved
> 75% of base salary if 130% to 149% of Plan is
achieved
> 100% of base salary if 150% or more of Plan is
achieved
Notwithstanding the foregoing, the Company's obligation to
make any bonus payments, whether during the first or any
subsequent period, should be dependent upon employee's
employment with the company throughout the end of each payment
period. For purposes of the Bonus, the annual period shall
commence on the Commencement Date (or anniversary thereof) and
continue for a one-year period. Employee will participate in
the final establishment of the Fiscal Year 2001 revenue and
profit targets upon which the above bonus incentive is based
as well as all moving forward targets and bonus based criteria
(c) Equity Compensation
(i) Stock Option
It will be recommended at the first meeting of the Company's
Board of Directors following your start date that the Company
grant you an option to purchase 220,000 shares of the
Company's Common Stock at a price per share equal to the fair
market value per share of the Common Stock on the date of
grant, as determined by the Company's Board of Directors. This
option grant shall be subject to the terms and conditions of
the Company's Stock Option Plan and Stock Option Agreement,
including vesting requirements. The option shall be for a term
of ten years (or shorter upon termination of employment or
consulting relationship with the Company) and, subject to
accelerated vesting as set forth below, shall be vested with
respect to twenty-five percent (25%) as of the first
anniversary of your date of employment and shall thereafter
vest at the rate of 1/36th of the remaining seventy-five
percent (75%) on the first day of each month following the
first anniversary of your date of employment.
In addition, in the event of (i) a Change in Control (as
defined below), and if, on or subsequent to the closing date
of the transaction(s) giving rise to such
Change in Control you are terminated without Cause or are
Constructively Terminated, then the 25% of shares that are
then unvested, if any, shall vest automatically immediately on
the date that your employment with the Company (or its
successors) is terminated in addition to being paid the
Severance terms as outlined below.
"Change in Control" shall mean (i) a merger of the Company
with or into another corporation, or (ii) a transaction or
series of transactions involving the sale of all the voting
stock or all or substantially all of the assets of the Company
where, in any such event, the shareholders of the Company
immediately preceding such transaction(s) do not hold at least
a majority of the voting stock of the entity surviving the
merger (in the case of clause (i)) or purchasing the assets or
stock (in the case of clause (ii)). Such vesting shall be
conditioned upon Employee's continued employment with the
Company as of each vesting date.
(d) Severance
(i) Termination Without Cause
In the event that the Employee's employment with the Company
is involuntarily terminated by the Company without "Cause" or
is "Constructively Terminated" (both as defined below), then
Employee shall receive a lump-sum payment equal to Four (4)
Months of his Base Salary. Further, Employee shall also
receive accelerated vesting of 25% of shares that are then
unvested within any period between the first (6) and Twelve
(12) months of service and then, thereafter, per the vesting
schedule as detailed above.
For the purposes of this Agreement, "Cause" is defined as: (i)
an act of dishonesty made by Employee in connection with his
responsibilities as an employee of the Company, (ii)
Employee's conviction of, or plea of nolo contendere to, a
felony, (iii) Employee's gross misconduct, or (iv) Employee's
breach or failure to perform his employment duties as
established by the President periodically and failure to cure
such breach within thirty (30) days after receipt of written
notice of breach from the Company.
For this purpose, "Constructive Termination" is defined as the
resignation of Employee within sixty (60) days following (i)
the assignment to Employee of duties incommensurate with his
status as Vice President, or any material reduction of the
Employee's duties, authority, responsibilities or title,
relative to the Employee's duties, authority, responsibilities
or title as in effect immediately prior to such reduction,
except if agreed to in writing by the Employee; (ii) a
material reduction by the Company in the Base Salary, as in
effect immediately prior to such reduction (in such situation,
severance is calculated on the original base salary in this
contract or whatever is most current at the time prior to the
reduction);or (iii) the relocation of the Employee to a
facility or a location more than thirty-five
(35) miles from the Employee's then present location, without
the Employee's written consent.
5) BUSINESS TRAVEL
Employee will travel on a minimum of Business Class of service on
all international air travel and on all domestic air travel that
exceeds five (5) hours in length.
6) TOTAL DISABILITY OF EMPLOYEE
Upon Employee's becoming permanently and totally disabled (as
defined in accordance with Internal Revenue Code Section 22(e)(3) or
its successor provision) during the term of this Agreement,
employment hereunder shall automatically terminate, all payments of
compensation by the Company to Employee hereunder shall immediately
terminate (except as to amounts already earned) and all vesting of
the Employee's unit options shall immediately cease.
7) DEATH OF EMPLOYEE
If Employee dies while employed by the Company pursuant to this
Agreement, all payments of compensation by the Company to Employee
hereunder shall immediately terminate (except as to amounts already
earned, which shall be paid to Employee's estate) and all vesting of
the Employee's unit options shall immediately cease.
8) ASSIGNMENT
This Agreement shall be binding upon and inure to the benefit of (a)
the heirs, executors and legal representatives of Employee upon
Employee's death and (b) any successor of the Company. Any such
successor of the Company shall be deemed substituted for the Company
under the terms of this Agreement for all purposes. As used herein,
"successor" shall include any person, firm, corporation or other
business entity which at any time, whether by purchase, merger or
otherwise, directly or indirectly acquires all or substantially all
of the assets or business of the Company. None of the rights of
Employee to receive any form of compensation payable pursuant to
this Agreement shall be assignable or transferable except through a
testamentary disposition or by the laws of descent and distribution
upon the death of Employee following termination without cause. Any
attempted assignment, transfer, conveyance or other disposition
(other than as aforesaid) of any interest in the rights of Employee
to receive any form of compensation hereunder shall be null and
void.
9) NOTICES
All notices, requests, demands and other communications called for
hereunder shall be in writing and shall be deemed given if (i)
delivered personally, (ii) one (1) day after being sent by Federal
Express or a similar commercial overnight service, or (iii) three
(3) days after being mailed by registered or certified mail, return
receipt requested, prepaid and addressed to the parties or their
successors in interest at the following addresses, or at such other
addresses as the parties may designate by written notice in the
manner aforesaid:
If to the Company: Xxxxxx Communications
0000 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxx Xxxxxxx, XX 00000
Attn: Chief Executive Officer
If to Employee: Xxxxxx Xxxxxxx
0000 Xxx Xxxxxxx
Xxxxx Xxxxxxx, XX 00000
10) SEVERABILITY
In the event that any provision hereof becomes or is declared by a
court of competent jurisdiction to be illegal, unenforceable or
void, this Agreement shall continue in full force and effect without
said provision.
11) PROPRIETY INFORMATION AGREEMENT
Employee agrees to enter into the Company's standard Proprietary
Information Agreement (the "Proprietary Information Agreement") upon
commencing employment hereunder.
12) ENTIRE AGREEMENT
This Agreement, the Stock Option Plan, the Option Agreement, and the
Proprietary Information Agreement represent the entire agreement and
understanding between the Company and Employee concerning Employee's
employment relationship with the Company, and supersede and replace
any and all prior agreements and understandings concerning
Employee's employment relationship with the Company.
13) ARBITRATION AND EQUITABLE RELIEF
(a) Except as provided in Section 13(c) below, Employee agrees that
any dispute or controversy arising out of, relating to, or in
connection with this Agreement, or the interpretation, validity,
construction, performance, breach, or termination thereof shall be
settled by arbitration to be held in Santa Xxxxxxx County,
California, in accordance with the National Rules for the Resolution
of Employment Disputes then in effect of the American Arbitration
Association (the "Rules"). The arbitrator may grant injunctions or
other relief in such dispute or controversy. The decision of the
arbitrator shall be final, conclusive and binding on the parties to
the arbitration. Judgment may be entered on the arbitrator's
decision in any court having jurisdiction.
(b) The arbitrator shall apply California law to the merits of any
dispute or claim, without reference to rules of conflict of law. The
arbitration proceedings shall be governed by federal arbitration law
and by the Rules, without reference to state arbitration law.
Employee hereby expressly consents to the personal jurisdiction of
the state and federal courts located in California for any action or
proceeding arising from or relating to this Agreement and/or
relating to any arbitration in which the parties are participants.
(c) Employee understands that nothing in Section 13 modifies
Employee's at-will status. Either the Company or Employee can
terminate the employment relationship at any time, with or without
cause.
(d) EMPLOYEE HAS READ AND UNDERSTANDS SECTION 13, WHICH DISCUSSES
ARBITRATION. EMPLOYEE UNDERSTANDS THAT BY SIGNING THIS AGREEMENT,
EMPLOYEE AGREES TO SUBMIT ANY FUTURE CLAIMS ARISING OUT OF, RELATING
TO, OR IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION,
VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH, OR TERMINATION THEREOF
TO BINDING ARBITRATION, AND THAT THIS ARBITRATION CLAUSE CONSTITUTES
A WAIVER OF EMPLOYEE'S RIGHT TO A JURY TRIAL AND RELATES TO THE
RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE
EMPLOYER/EMPLOYEE RELATIONSHIP, INCLUDING BUT NOT LIMITED TO, THE
FOLLOWING CLAIMS:
(i) ANY AND ALL CLAIMS FOR WRONGFUL DISCHARGE OF
EMPLOYMENT; BREACH OF CONTRACT, BOTH EXPRESS AND
IMPLIED; BREACH OF THE COVENANT OF GOOD FAITH AND FAIR
DEALING, BOTH EXPRESS AND IMPLIED; NEGLIGENT OR
INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS; NEGLIGENT
OR INTENTIONAL MISREPRESENTATION; NEGLIGENT OR
INTENTIONAL INTERFERENCE WITH CONTRACT OR PROSPECTIVE
ECONOMIC ADVANTAGE; AND DEFAMATION.
(ii) ANY AND ALL CLAIMS FOR VIOLATION OF ANY FEDERAL
STATE OR MUNICIPAL STATUTE, INCLUDING, BUT NOT LIMITED
TO, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, THE
CIVIL RIGHTS ACT OF 1991, THE AGE DISCRIMINATION IN
EMPLOYMENT ACT OF 1967, THE AMERICANS WITH DISABILITIES
ACT OF 1990, THE FAIR LABOR STANDARDS ACT, THE
CALIFORNIA FAIR EMPLOYMENT AND HOUSING ACT, AND LABOR
CODE SECTION 201, et seq;
(iii) ANY AND ALL CLAIMS ARISING OUT OF ANY OTHER LAWS
AND REGULATIONS RELATING TO EMPLOYMENT OR EMPLOYMENT
DISCRIMINATION.
14) NO ORAL MODIFICATION, CANCELLATION OR DISCHARGE
This Agreement may only be amended, canceled or discharged in
writing signed by Employee and the Company.
15) WITHHOLDING
The Company shall be entitled to withhold, or cause to be withheld,
from payment any amount of withholding taxes required by law with
respect to payments made to Employee in connection with his
employment hereunder.
16) GOVERNING LAW
This Agreement shall be governed by the laws of the State of
California.
17) EFFECTIVE DATE
This Agreement is effective January 8th, 2001.
18) ACKNOWLEDGMENT
Employee acknowledges that he has had the opportunity to discuss
this matter with and obtain advice from his private attorney, has
had sufficient time to, and has carefully read and fully understands
all the provisions of this Agreement, and is knowingly and
voluntarily entering into this Agreement.
19) CONFIDENTIALITY
Both Employee and the Company agree that this document and the terms
included herein are private and confidential to both the employee
and to those within the Company that has a need to know this
information. Both parties agree to keep this information private and
confidential during the entire employment term. However, this
confidentiality clause does not preclude employee from discussion
any and all related employment and compensation matters with
personal attorneys, accountants and business advisors at any time.
IN WITNESS WHEREOF, the undersigned have executed this Agreement on the
respective dates set forth below:
XXXXXX COMMUNICATIONS, Inc.
/s/ Xxx Xxxxxxxxx
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Xxx Xxxxxxxxx
CEO and Chairman
EMPLOYEE
/s/ Xxxxxx X. Xxxxxxx
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Xxxxxx Xxxxxxx
