AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT
AMENDED
AND RESTATED
The
Executive Employment Agreement (the “Agreement”) is made and entered as of the
1st
day of
September, 2001, by and between International Microcomputer Software, Inc.,
a
California corporation, (“IMSI”) and Xxxxxx X. Xxxxxxx (“Executive”).
Whereas,
IMSI
desires to retain the services of Executive in an active executive capacity
and
Executive is willing to accept employment by IMSI on the terms and subject
to
the conditions set forth in this Agreement;
NOW,
THEREFORE,
in
consideration of the premises and the covenants contained herein, the Parties
agree as follows:
1.
Employment - IMSI
hereby hires Executive as President of IMSI with overall responsibility for
IMSI’s profitability and operations.
2.
Compensation -
IMSI
shall compensate Executive as follows:
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(a)
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Base
Salary
-
Effective April 1, 2004, IMSI shall pay Executive $195,000 per year
($16,250 per month) in salary payable on the 15th
and the last day of each month. Executive’s salary will be further
adjusted based upon review by the Board of Directors of Executive’s
performance at least once each fiscal year and after each major
acquisition made by the company.
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(b)
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Options
- Effective
September 1, 2001, Executive was granted warrants to purchase 350,000
shares of Common Stock at a price of $0.26 per share. In the event
that
the majority control of IMSI changes or Executive is terminated without
cause, all warrants held by Executive shall immediately vest and
the right
to exercise them shall survive for three years thereafter. Warrants
shall
vest pro rata monthly over 24 months, commencing in the month of
September, 2001.
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(c)
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Bonuses
-
Executive may earn a bonus of up to 100% of base pay based upon
performance of the Company and improvement of the Company’s financial
condition. Executive will earn this bonus quarterly based upon criteria
approved by the CEO or Board of IMSI. In the event the Company reaches
the
Operating, Net Income or Balance Sheet goal for the then-current
fiscal
year, any unearned bonuses from previous quarters in that fiscal
year
shall be payable to Executive 45 days after the end of the fiscal
year.
During each fiscal year of employment Executive will earn a cash
bonus of
a) $100,000 for the sale of any asset, company or product line of
the
company in which the net sales price is in excess of $2,000,000 but
less
than $5,000,000; b) 2.0% for the sale of any asset, company or product
line of the company in which the net sales price is in excess of
$5,000,000. Payment of bonuses from the sale of assets, products
or
companies shall be made to Executive 15 days after the sale of such
assets.
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In
the
event of a sale, merger or consolidation of the Company with or into another
entity or any other corporate reorganization which results in a net share amount
greater than $1.50, Employee earns a bonus of $150,000, which becomes
immediately payable
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(d)
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Executive
Benefits
-
Executive shall have the right to participate in any and all health
benefits, executive retirement income and welfare benefit plans,
policies,
programs, agreements or arrangements generally made available from
time to
time to salaried executives and/or other executives of IMSI which
shall
include, at a minimum, medical and dental insurance (the premiums
for
which shall be paid in full by IMSI) and other benefits which are
presently in effect for executives of IMSI. Executive shall be entitled
to
thirty (30) days’ vacation time each year without loss of compensation. In
the event Executive is unable to take the total amount of vacation
time
authorized herein during any year, he may accrue that time and add
it to
vacation time for the following year. Executive’s spe-cific rights under
any of the Executive Benefits, however, shall be governed by the
terms,
provisions and conditions of the underlying plans, policies, programs,
agreements or arrangements relating to the particular Executive Benefits,
except as specifically provided otherwise in this Agreement. At
Executive’s option IMSI shall pay Executive the amount of the premium for
medical and dental insurance so that Executive can maintain and pay
for
health and dental insurance directly.
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(e)
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Incentive
Plans
-
Executive shall be covered under and participate in any incentive
compensation, bonus, discretionary pay, or performance award plans,
programs, polices, arrangements, or any stock option or stock appreciation
rights plans which IMSI may have or put into effect for its execu-tives
(Incentive Plans).
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3. Termination
of Employment
-
IMSI may
terminate Executive’s employment at any time with or without cause. The
following termination provisions shall survive termination of Executive’s
employment and can only be modified by a subsequent written agreement executed
by Executive and IMSI:
(a)
Termination Without Cause
-
Termination without cause shall include, but not be limited to, IMSI or its
successors choosing to substantially alter the position, geographic location
or
responsibilities of Executive during the term of this Agreement. In the event
a
significant part of the companies assets are sold, Executive’s respsonsibilites
will have been deemed to be altered. Termination without cause shall result
in
IMSI paying full compensation to Executive for a minimum of twenty four (24)
months and Executive Benefits and Incentive Plans shall also be paid for a
period of twenty four (24) months and will be paid to Executive on a normally
scheduled basis. Any, and all, unvested Incentive Stock Option (“ISO”) options
or warrants which have been duly granted by the Company to Employee become
immediately exercisable, any other provision of the Incentive Stock Option
agreement notwithstanding.
(b)
Termination by IMSI For Cause
- IMSI
may terminate Executive’s employment for cause by giving ninety (90) days’
written notice to Employee. For purposes of this Agreement, “for cause” shall be
limited to the following: Conviction by a court of competent jurisdiction of
any
crime constituting a felony under the criminal laws of the jurisdiction in
which
the conviction is entered.
(c)
Termination by Executive
-
Executive may terminate his employment with IMSI at any time with or without
cause. In any such case, IMSI shall continue to pay his medical and dental
benefits for twelve (12) months after termination.
4.
Trade
Secrets -
Executive acknowledges that IMSI possesses and will continue to develop and
acquire valuable Proprietary Information. The value of that Proprietary
Information depends on it remaining confidential. IMSI depends on Executive
to
maintain that confidentiality, and Executive accepts that position of
trust. Executive
agrees, upon leaving employment with IMSI for any reason, to promptly deliver
to
IMSI all material documents, including but not limited to writings and computer
data, in Executive's possession, custody, or under Executive's control
containing or disclosing Proprietary Information.
5.
Conflicts with Other Activities - Executive
agrees that his employment with IMSI is requires substantial attention and
effort. Therefore, while employed by IMSI, Executive will not, without IMSI's
consent, engage in any activity directly competitive with IMSI . It is agreed
that Executive is an owner in GL Ventures, Inc., which provides business
consulting for technology and internet companies. Executive agrees that such
consulting will not be competitive with IMSI.
6.
Additional Provisions Relating to Payments - If
IMSI
finds that, at the time any payment is due under this Agreement, Executive
is
unable to care for his affairs because of illness or accident, payment (unless
a
duly qualified guardian or other legal representative of Executive has made
IMSI
an ear-lier claim for it) may be paid to any individual deemed by IMSI to be
maintaining Executive or responsible for Executive’s maintenance, and any such
payment shall be deemed to be payment for the Executive’s account and shall be a
complete discharge of any liability under this Agreement. IMSI will honor any
request made prior to his disability by Executive regarding such payments.
IMSI
may withhold from any amounts payable under this Agreement all federal, state,
city or other taxes as required under any law or government regulation or
ruling.
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7.
Governing Law -
This
Agreement shall be construed and its performance enforced in accordance with
the
laws of the State of California, excluding its choice of law
provisions.
8.
Modifications - Any
and
all modifications, amendments, or additions to this Agreement shall be in
writing. Similarly, any and all waivers of any terms of this Agreement shall
be
in writing. Any and all oral modifications, amendments, additions, and/or
waivers shall be unenforceable.
9.
Severability -
If a
court of competent jurisdiction or arbitrator finds that one or more provisions
of this Agreement is or are illegal or unenforceable, the remaining provisions
of this Agreement shall re-main in full force and effect as if such provision
or
provisions never existed.
10.
Waiver
-
No
Party's right to require performance of another Party's obligations under this
Agree-ment shall be affected by any previous delay in enforcing such right,
express waiver of prior similar right to require performance, or course of
dealing.
11.
Integration Clause -
This
Agreement contains the entire agree-ment of the Parties relating to the subject
matter of this Agreement. The Parties have made no agreements, representations,
or warranties re-lating to the subject matter of these Agreements that are
not
stated herein.
12.
Interpretation of this Agreement -
The
Parties acknowledge that they and their attorneys have had an opportunity to
review this Agreement in detail and to comment on and draft any and all
addi-tional terms or modifications to this Agreement. Accordingly, the Parties
agree that this Agreement shall not be interpreted against any Party under
California Civil Code § 1654 because the attorney for that Party drafted this
Agreement or any provision of this Agreement.
13.
Successors - Should
any change in IMSI ownership or structure occur, this Agreement shall survive
and inure to the benefit of and be binding on the legal representatives,
successors and assigns of the parties.
14.
Special Indemnity - IMSI
hereby agrees to hold harmless and indemnify Executive to the full extent
authorized or permitted by law, as such may be amended from time to time, and
by
the Articles of Incorporation and Bylaws of IMSI, as such may be amended. IMSI
shall purchase and maintain a policy or policies of directors' and officers'
liability insurance ("D & O Insurance") to cover liabilities which may be
incurred by its officers or directors in the performance of their obligations
to
IMSI, and IMSI shall include Executive within such policy.
15.
Notices.
Notices
under this Agreement shall be sufficient only if sent (a) by overnight courier,
or (b) by facsimile or other electronic means and by U. S. Mail, or (c)
personally delivered to the other Party. Notices shall be addressed as
follows:
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To
IMSI:
International
Microcomputer Software, Inc.
00
Xxxxxxx Xxx
Xxxxxx,
XX 00000
Attn:
Xxxxxx Xxxx, CEO
Fax:
000-000-0000
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To
Executive:
Xxxxxx
Xxxxxxx
00
Xxxxxxxx Xxxxx
Xxxxxx,
XX 00000
Fax:
000-000-0000
With
a copy to:
Xxxxx
Xxxxxxxxx
Xxxxx
and Xxxxxxxxxx
000
Xxxxxxxx Xxxxxxxxx, 00xx
Xxxxx
Xxx
Xxxxxxx XX 00000
Fax:
310/000 0000
Tel:
310/000 0000
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Any
Party
may change the above information by giving written notice as set forth
above.
16.
Counterparts.
This
Agreement may executed in one or more counterparts, each of which shall be
deemed to be an original, but all of which together shall constitute one and
the
only Agreement.
IN
WITNESS WHEREOF,
the
Parties have executed this Agreement this 1st
day of
May , 2005, but as of September 1, 2001.
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International
Microcomputer Software, Inc.
/s/
XXXXXX XXXX III
Xxxxxx
Xxxx III
Chief
Executive Office
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/s/
XXXXXX XXXXXXX
Xxxxxx
X. Xxxxxxx
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