EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is entered into effective this 30th
day of June, 1999, by and between Reliant Interactive Media Corp. (the
"Employer"), and Xxx Xxxxxx (the "Employee").
PREMISES
a) Employee possesses expertise, experience and skill in the development
and marketing of products via electronic and other multi-media means.
b) Employee has demonstrated the ability to run, manage and build a
development stage business.
c) Employer desires to employ Employee to serve as its Executive Vice
President.
d) Employee desires to perform all of such services as Employer's employee
and both parties want to enter into a written agreement as to their
understanding of the employment relationship.
AGREEMENT
For and in Consideration of the mutual covenants contained herein and of
the mutual benefits to be derived hereunder, the parties agree as follows:
1. Definitions. Whenever used in this Agreement, the following terms shall
have the meanings set forth below:
(a) "Accrued Benefits" shall mean the amount payable not later than
ten (10) days following an applicable Termination Date and which shall be
equal to the sum of the following amounts:
(i) All salary earned or accrued through the Termination Date;
(ii) Reimbursement for any and all monies advanced in connection
with Employee's employment for reasonable and necessary expenses
incurred by Employee and approved by the Employer through the
Termination Date; and
(iii) All other payments and benefits to which Employee may be
entitled under the terms of any benefit plan of the Employer.
(b) "Board" shall mean the board of directors of the Employer.
(c) "Cause" shall mean any of the following:
(i) The engagement by Employee in fraudulent conduct, which has a
significant adverse impact on the Employer in the conduct of the
Employer's business;
EMPLOYMENT AGREEMENT
Reliant Interactive Media Corp. ("Employer")
and Xxx Xxxxxx ("Employee").
June 1999 Page 2
(ii) Conviction of a felony involving a crime against the
Employer, as evidenced by a binding and final judgment, order or
decree of a court of competent jurisdiction.
(iii) Gross negligence or refusal by Employee to perform his
duties or responsibilities; or
(d) "Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time.
(e) "Confidential Information" means information (i) disclosed to or
actually known by Employee as a consequence of or through his/her
employment with the Employer, (ii) not generally known outside the
Employer, and (iii) which relates to the Employer's business. Confidential
Information includes, but is not limited to, information of a technical
nature, such as methods and materials, trade secrets, inventions,
processes, formulas, systems, computer programs, and studies, and
information of a business nature such as project plans, market information,
costs, customer lists, and so forth.
(f) "Disability" shall mean a physical or mental condition whereby
Employee is unable to perform on a full-time basis his customary duties
under this Agreement.
(g) "Developments" means all Inventions (defined hereafter), computer
programs, copyright works, mask works, trademarks, Confidential
Information, Works of Authorship (defined hereafter), and other
Intellectual Property (defined hereafter), made, conceived or authored by
Employee, alone or jointly with others, while employed by the Employer;
whether or not during normal business hours or on the Employer's premises,
that are within the present scope of the Employer's business at the time
such Developments are made, conceived, or authored, or which result from or
are suggested by any work Employee or others may do for or on behalf of the
Employer.
(h) "Employer" means Reliant Interactive Media Corp. and its
subsidiaries, divisions and affiliates as well as majority owned companies
of such subsidiaries, divisions and affiliates, or their successors or
assigns.
(i) "Invention" means discoveries, concepts, and ideas, whether or not
patentable or copyrightable, including but not limited to improvements,
know-how, data, processes, methods, formulae, and techniques, as well as
improvements thereof, or know-how related thereto, concerning any present
or prospective activities of the Employer which Employee makes, discovers
or conceives (whether or not during the hours of his engagement of with the
use of the Employer's facilities, materials or personnel), either solely or
jointly
EMPLOYMENT AGREEMENT
Reliant Interactive Media Corp. ("Employer")
and Xxx Xxxxxx ("Employee").
June 1999 Page 3
with others during his engagement by the Employer or any affiliate and, if
based on or related or Proprietary Information, at any time after
termination of such engagement.
(j) "Intellectual Property" means Inventions, Confidential
Information, Works of Authorship, patent rights, trademark rights, service
xxxx rights, copyrights, know-how, Developments and rights of like nature
arising or subsisting anywhere in the world, in relation to all of the
foregoing, whether registered or unregistered.
(k) "Notice of Termination" shall mean the notice described in Section
13 hereof.
(l) "Person" shall mean any individual, partnership, joint venture,
association, trust, corporation or other entity, other than an employee
benefit plan of the Employer of an entity organized, appointed of
established pursuant to the terms of any such benefit plan.
(m) "Proprietary Information" shall mean any and all methods,
inventions, improvements or discoveries, whether or not patentable or
copyrightable, and any other information of a similar nature related to the
business of the Employer disclosed to the Employee or otherwise made known
to him as a consequence of or through his engagement by the Employer
(including information originated by Employee) in any technological area
previously developed by the Employer or developed, engaged in, or
researched, by the Employer during the term of Employee's engagement,
including, but not limited to, trade secrets, processes, products,
formulae, apparatus, techniques, know-how, marketing plans, data,
improvements, strategies, forecasts, customer lists, and technical
requirements of customers, unless such information is in the public domain
to such an extent as to be readily available to competitors.
(n) "Termination Date" shall mean, except as otherwise provided in
Section 12 hereof.
(i) Employee's date of death;
(ii) Thirty (30) days after the delivery of the Notice of
Termination if Employee's employment on account of Disability pursuant
to Section 16 hereof, unless Employee returns on a full-time basis to
the performance of his duties prior to the expiration of such period;
(iii) Thirty (30) days after the delivery of the Notice of
Termination if Employee's employment is terminated by Employee
voluntarily; and
EMPLOYMENT AGREEMENT
Reliant Interactive Media Corp. ("Employer")
and Xxx Xxxxxx ("Employee").
June 1999 Page 4
(iv) Thirty (30) days after the delivery of the Notice of
Termination if Employee's employment is terminated by the Employer for
any reason other than death or Disability.
(o) "Termination Payment" shall mean the payment described in Section
14 hereof.
(p) "Works of Authorship" means an expression fixed in a tangible
medium of expression regardless of the need for a machine to make the
expression manifest, and includes but is not limited to, writings, reports,
drawings, sculptures, illustrations, video recordings, audio recordings,
computer programs, and charts.
2. Employment. Employer hereby employs Employee to perform those duties
generally described in this Agreement, and Employee hereby accepts and agrees to
such employment on the terms and conditions hereinafter set forth.
3. Term. Subject to the terms and conditions of this Agreement, the term
of this Agreement shall commence retroactively from __________________, and end
on ___________________.
4. Duties. During the term of this Agreement, Employee shall be employed by
Employer as its Executive Vice President. In addition to the office of Executive
Vice President, Employee agrees to serve in such other office or position with
Employer or any subsidiary of Employer and as such shall, from time to time, be
determined by Employer's Board. Employee agrees to serve as a member of the
Employer's Board. Employee shall devote substantially all of his working time
and efforts to the business of Employer and its subsidiaries and shall not
during the term of this Agreement be engaged in any other substantial business
activities which will significantly interfere or conflict with the reasonable
performance of his duties hereunder.
5. Compensation.
(a) Salary. For all services rendered by Employee, Employer shall pay
to Employee a base salary of $3,500 per month, in bi-monthly installments.
Employee shall also be due a base salary from the time of the inception of
employment by Employer of the Employee to the date of this Agreement equal
to the same base salary rate. If Employer's financial constraints so
dictate, Employee agrees to defer a portion of the salary contained in this
Section. This deferred base salary along with any deferred base salary
earned prior to the date of this Agreement shall be paid to Employee at
such time or times as financial constraints so dictate. The rate of salary
may be increased at any time, as the Board may determine, based on
earnings, increased activities of the Employer, or such other factors as
the Board may deem appropriate from
EMPLOYMENT AGREEMENT
Reliant Interactive Media Corp. ("Employer")
and Xxx Xxxxxx ("Employee").
June 1999 Page 5
time to time. Employee shall receive bonus or incentive compensation as
approved by the Board.
(b) Insurance Benefits. Employer shall provide health and medical
insurance for Employee in a form and program to be chosen by Employer for
certain of its full-time employees. Employer shall provide Employee with
directors and officers liability insurance in the amount of $2,000,000 and
life disability insurance in amounts approved by the Board.
(c) Other Benefits. On or about August 5, 1999, Employee shall be
issued 100,000 shares of Employer's stock as additional compensation for
his services. Employee shall be entitled to participate in any retirement,
pension, profit-sharing, or other plan as may be put in effect from time to
time by the Board, including the following:
(i) Qualified Stock Option Plan. Pursuant to a Qualified Stock Option
Plan authorized by the Board and approved by the Shareholders of
Employer, Employee shall have the option to purchase up to 5,000
shares of Employer's stock in six months at $2.50 per share, in 12
months at $4.00 per share, in eighteen months at $6.00 per share and
in twenty-four months at $7.50 per share;
(ii) Revenue Performance Bonuses. Employee shall be issued 100,000
shares of Employer's stock for each $10,000,000 in gross revenues (in
accordance with SEC Reg SX accounting rules) received by Employer with
a maximum of 900,000 shares to be issued; provided that no more than
1/6 of this stock can be vested in any six month period. However, the
first 100,000 shares cannot be vested prior to February 5, 2000, and
for this first issuance hereunder Employer must have received a
minimum of $20,000,000 in gross revenues; and
(iii) Stock Performance Options. Employee shall have the option to
purchase stock of Employer at $7.50 per share as follows: up to 12,500
shares if the public trading price close at a minimum of $15 per share
for five consecutive days; up to an additional 12,500 shares should
the public trading price close at a minimum of $20 per share for five
consecutive days; and up to an additional 15,000 shares if the public
trading price should close at a minimum of $25 for five consecutive
days.
(d). Automobile / Transportation. Emploer shall pay for Employee's
monthly automobile payment, not to exceed $500 per month, including
applicable insurance.
EMPLOYMENT AGREEMENT
Reliant Interactive Media Corp. ("Employer")
and Xxx Xxxxxx ("Employee").
June 1999 Page 6
6. Expenses. Employer will reimburse Employee for expenses incurred in
connection with Employer's business, including expenses for travel, lodging,
meals, beverages, entertainment, and other items of Employee's periodic
presentation of an account of such expenses.
7. Working Facilities. Employer shall provide to Employee offices and
facilities appropriate to Employee's position and suitable for the performance
of Employee's duties as set forth in this Agreement.
8. Nondisclosure of Proprietary and Confidential Information. Recognizing
that the Employer is presently engaged, and may hereafter continue to be engaged
in the research and development of processes, the manufacturing of products or
performance of services, which involve experimental and inventive work and that
the success of the Employer's business depends upon the protection of the
processes, products and services by patent, copyright or by secrecy and that
Employee has had, or during the course of his engagement may have, access to
Proprietary and Confidential Information, as herein defined, of the Employer or
other information and data of a secret or proprietary nature of the Employer
which the Employer wishes to keep confidential and Employee has furnished, or
during the course of his engagement may furnish, such information to the
Employer, Employee agrees and acknowledges that:
(a) The Employer has exclusive property rights to all Proprietary and
Confidential Information and Employee hereby assigns all rights he might
otherwise possess in any Proprietary and Confidential Information to the
Employer. Except as required in the performance of his duties to the
Employer, Employee will not at any time during or after the term of his
engagement, which term shall include any time in which Employee may be
retained by the Employer as a consultant, directly or indirectly use,
communicate, disclose or disseminate any Proprietary or Confidential
Information of a secret, proprietary, confidential or generally undisclosed
nature relating to the Employer, its products, customers, processes and
services, including information relating to testing, research, development,
manufacturing, marketing and selling.
(b) All documents, records, notebooks, notes, memoranda and similar
repositories of, or containing, Proprietary and Confidential Information or
any other information of a secret, proprietary, confidential or generally
undisclosed nature relating to the Employer or its operations and
activities made or compiled by Employee at any time or made available to
him prior to or during the term of his engagement by the Employer,
including any and all copies thereof, shall be the property of the
Employer, shall be held by him in trust solely for the benefit of the
Employer, and shall be delivered to the Employer by him on the termination
of his engagement or at any other time on the request of the Employer.
EMPLOYMENT AGREEMENT
Reliant Interactive Media Corp. ("Employer")
and Xxx Xxxxxx ("Employee").
June 1999 Page 7
(c) Employee will not assert any rights under any inventions,
trademarks, copyrights, discoveries, concepts or ideas, or improvements
thereof, or know-how related thereto, as having been made or acquired by
him during the term of his engagement if based on or otherwise related to
Proprietary or Confidential Information.
9. Assignment Of Inventions.
(a) All Inventions shall be the sole property of the Employer, and
Employee agrees to perform the provisions of the Section 9 with respect
thereto without the payment by the Employer of any royalty or any
consideration therefor other than the regular compensation paid to Employee
in the capacity of any employee or consultant.
(b) Employee shall apply, at the Employer's request and expense, for
United States and foreign letters patent or copyrights either in Employee's
name or otherwise an the Employer shall desire.
(c) Employee hereby assigns to the Employer all of his rights to such
Inventions, and to applications for United States and/or foreign letters
patent or copyrights and to United States and/or foreign letter patent or
copyrights granted upon such Inventions.
(d) Employee shall acknowledge and deliver promptly to the Employer,
without charge to the Employer, but at its expense, such written
instruments (including applications and assignments) and do such other
acts, such as giving testimony in support of Employee's inventorship, as
may be necessary in the opinion of the Employer to obtain, maintain,
extend, reissue and enforce United States and/or foreign letters patent and
copyrights relation to the Inventions and to vest the entire right and
title thereto in the Employer of its nominee. Employee acknowledges and
agrees that any copyright developed or conceived of, by Employee during the
term of his employment which is related to the Business of the Employer
shall be a "work for hire" under the copyright law of the United States and
other applicable jurisdictions.
(e) Employee represents that his performance of all the terms of this
Agreement and as an employee of or consultant to the Employer does not and
will not breach any trust prior to his employment by the Employer. Employee
agrees not to enter into any agreement either written or oral in conflict
herewith and represents and agrees that he has not brought and will not
bring with to the Employer or use in the performance of his
responsibilities at the Employer any materials or documents of a former
employer which are not generally available to the public, unless he has
obtained written authorization from the former employer for their
possession and use, a copy of which has been provided to the Employer.
EMPLOYMENT AGREEMENT
Reliant Interactive Media Corp. ("Employer")
and Xxx Xxxxxx ("Employee").
June 1999 Page 8
(f) No provisions of the Paragraph shall be deemed to limit the
restrictions applicable to Employee under Section 8 and 9.
10. Shop Rights.
The Employer shall also have the royalty-free right to use in its business,
and to make, use and sell products, processes and/or services derived from any
inventions, discoveries, concepts and ideas, whether or not patentable,
including but not limited to processes, methods, formulas and techniques, as
well as improvements thereof or know-how related thereto, which are not within
the scope of Inventions as defined herein but which are conceived of or made by
Employee during the period he is engaged by the Employer or with the use or
assistance of the Employer's facilities, materials or personnel.
11. Non-Compete.
Employee hereby agrees that during the term of this Agreement Employee will
not:
(a) Within any jurisdiction or marketing area in the United States in
which the Employer or any subsidiary thereof is doing business, own,
manage, operate, or control any business of the type and character engaged
in and competitive with the Employer or any subsidiary thereof. For
purposes of this paragraph, ownership of securities of not in excess of
five percent (5%) of any class of securities of a public employer listed on
a national securities exchange or on the National Association of Securities
Dealers Automated Quotation System (NASDAQ) shall not be considered to be
competition with the Employer or any subsidiary thereof;
(b) Within any jurisdiction or marketing area in the United States in
which the Employer or any subsidiary thereof is doing business, act as, or
become employed as an officer, director, employee, consultant or agent of
any business of the type and character engaged in and competitive with the
Employer or any of its subsidiaries;
(c) Solicit any similar business to that of the Employer's for, or
sell any products that are in competition with the Employer's products to
which is, as of the date hereof, a customer or client of the Employer or
any of its subsidiaries, or was such a customer or client thereof within
two years prior to the date of this Agreement; or
(d) For up to six months following the termination of this Agreement,
solicit the employment of, or hire, any full time employee employed by the
Employer or its subsidiaries as of the date of termination of this
Agreement.
EMPLOYMENT AGREEMENT
Reliant Interactive Media Corp. ("Employer")
and Xxx Xxxxxx ("Employee").
June 1999 Page 9
12. Termination. Employer may not terminate this Agreement during its term
without Cause as defined herein. If this Agreement is terminated without Cause,
Employee shall be entitled to the Termination Payments set forth in Section 14
hereof. Any termination by Employer of Employee of Employee's employment during
the term hereof shall be communicated by written Notice of Termination to
Employee, if such Notice of Termination is delivered by the Employer, and to the
Employee, if such Notice of Termination is delivered by Employee, all in
accordance with the following procedures:
(a) The Notice of termination shall indicate the specific termination
provision in this Agreement relied upon and shall set forth in reasonable
detail the facts and circumstances alleged to provide a basis for
termination;
(b) Any Notice of Termination by the Employer shall be approved by a
resolution duly adopted by a majority of the members of the Employer;
(c) If Employee shall provide the president or chief executive officer
with a Notice of Termination at least 30 days prior to leaving the
employment of the Employer. Upon the end of the thirty days, all
compensation provisions of this Agreement shall cease.
13. Termination Upon Transfer of Business. Notwithstanding any provision
this Agreement to the contrary, Employee may terminate this Agreement upon the
happening of any of the following events: (a) the sale by Employer of
substantially all of its assets to a single purchaser or to a group of
associated purchasers; (b) the sale, exchange, or other disposition to a single
entity or group of entities under common control in one transaction or series of
related transactions of greater than 50% of the outstanding shares of Employer's
common stock; (c) the decision by Employer to terminate its business and
liquidate its assets; or (d) the merger or consolidation of Employer in a
transaction in which the shareholders of the Employer immediately prior to such
merger or consolidation receive less than 50% of the outstanding voting shares
of the new or continuing corporation. In the event Employee does not elect to
terminate this Agreement upon the happening of any of the events noted above,
and as a result of such event, Employer is not the surviving entity, then the
provisions of this Agreement shall inure to the benefit of and be binding upon
the surviving or resulting entity. If as a result of the merger, consolidation,
transfer of assets, or other event listed above, the duties of Employee are
increased, then the compensation of Employee provided for in paragraph 5 of this
Agreement shall be reasonably adjusted upward for the additional duties and
responsibilities assumed.
14. Termination Payments. In the event the Employee's employment is
terminated by the Employer during the term hereof for reasons other than Cause,
as defined herein, Employee shall be paid any sums owed under this Agreement,
including but not limited to any salary, any deferred compensation, accrued
EMPLOYMENT AGREEMENT
Reliant Interactive Media Corp. ("Employer")
and Xxx Xxxxxx ("Employee").
June 1999 Page 10
benefits, bonuses and options, and for any potential actions for breach of this
Agreement by Employer. Other than any payments set forth in this Section 14,
Employment shall be entitled to no further compensation nor any other payments
after termination. Employee shall receive no further payments if terminated for
Cause other than Accrued Benefits.
15. Death During Employment. If Employee dies during the term of this
Agreement, Employer shall have no further obligations to pay Employee other than
any Accrued Benefits.
16. Illness or Incapacity. If Employee is unable to perform Employee's
services by reason of illness or incapacity for a period of more than two (2)
consecutive months, the compensation thereafter payable to Employee during the
next two (2) consecutive months shall be 50% of the compensation provided for
herein. During such period of illness or incapacity, Employee shall be entitles
to receive incentive compensation if any. Notwithstanding the foregoing, if such
illness or incapacity does not cease to exist within a four (4) consecutive
month period, Employee shall not be entitled to receive any further compensation
nor any payments for such illness or incapacity, and Employer may terminate this
Agreement without further liability to Employee. Any existing options to
purchase Employer's common stock held by Employee at the time termination shall
be governed by the terms of the option and not affected by this provision. At
the termination of such illness or incapacity, Employee shall be entitled to
receive Employee's full compensation payable pursuant to the terms of this
Agreement.
17. Nontransferability. Neither Employee, Employee's spouse, Employee's
designated contingent beneficiary, nor their estates shall have any right to
anticipate, encumber, or dispose of any payment due under this Agreement. Such
payments and other rights are expressly declared nonassignable and
nontransferable except as specifically provided herein.
18. Indemnification. Employer shall indemnify Employee and hold Employee
harmless from liability for acts or decisions made by Employee while performing
services for Employer to the greatest extent permitted by applicable law.
Employer shall use its best efforts to obtain coverage for Employee under any
insurance policy now in force or hereafter obtained during the term of this
Agreement insuring officers and directors of Employer against such liability.
19. Assignment. This Agreement may not be assigned by either party without
the prior written consent of the other party.
20. Entire Agreement. This Agreement is and shall be considered to be the
only agreement or understanding between the parties hereto with respect to the
employment of employee by employer. All negotiations, commitments, and
understandings acceptable to both parties have been incorporated herein. No
EMPLOYMENT AGREEMENT
Reliant Interactive Media Corp. ("Employer")
and Xxx Xxxxxx ("Employee").
June 1999 Page 11
letter, telegram, or communication passing between the parties hereto covering
any matter during this contract period, or any plans or periods thereafter,
shall be deemed a part of this Agreement; nor shall it have the effect of
modifying or adding to this Agreement unless it is distinctly stated in such
letter, telegram, or communication that is to constitute a part of this
Agreement and is attached as an amendment to this Agreement and is signed by the
parties to this Agreement.
21. Enforcement. Each of the parties to this Agreement shall be entitled to
any remedies available in equity or by statute with respect to the breach of the
terms of this Agreement by the other party. Employee hereby specifically
acknowledges and agrees that a breach of the agreements, covenants and
conditions of this Agreement will cause irreparable harm and damage to the
Employer, that the remedy at law, for the breach or threatened breach of this
Agreement will be adequate, and that, in addition to all other remedies
available to the Employer for such breach or threatened breach (including,
without limitation, the right to recover damages), the Company shall be entitled
to injunctive relief for any breach or threatened breach of this Agreement.
22. Governing Law. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of Nevada.
23. Severability. If and to the extent that any court of competent
jurisdiction holds any provision or any part thereof of this Agreement to be
invalid or unenforceable, such holding shall in no way affect the validity of
the remainder of this Agreement.
24. Waiver. No failure by any party to insist upon the strict performance
of any covenant, duty, agreement, or condition of this Agreement or to exercise
any right or remedy consequent upon a breach hereof shall constitute a waiver of
any such breach or of any covenant, agreement, term, or condition.
25. Litigation Expenses. In the event that it shall be necessary or
desirable for the Employee or Employer to retain legal counsel and/or incur
other costs and expenses in connection with the enforcement of any or all of the
provisions of this Agreement, the prevailing party shall be entitled to recover
from the other party reasonable attorneys' fees, costs, and expenses incurred by
the prevailing party in connection with the enforcement of this Agreement.
Payment shall be made upon the conclusion of such action.
26. Survivability. The provisions of Section 8, 9, 10, 11 and 12 shall
survive termination of this Agreement.
EMPLOYMENT AGREEMENT
Reliant Interactive Media Corp. ("Employer")
and Xxx Xxxxxx ("Employee").
June 1999 Page 12
AGREED AND ENTERED INTO as of the date first above written.
EMPLOYER: EMPLOYEE:
Reliant Interactive Media Corp.
By: /s/ By: \s\
---------------------------------- --------------------------------
Duly Authorized Officer Xxx Xxxxxx
