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EMPLOYMENT AGREEMENT
CKS Group, Inc., a Delaware corporation (hereafter referred to as the
"Employer", the "Company", or "CKS") and Xxxxxx X. Xxxxxxxx (hereafter referred
to as "Employee") (jointly referred to hereafter as the "parties") wish to enter
into an agreement ("Agreement") pursuant to which CKS will employ the Employee.
Accordingly, in consideration for the benefits and promises set forth herein,
the parties agree as follows:
1. Employment.
1.1 Position. Employee agrees to serve as the Employer's
Executive Vice President of Business Development ("EVP") reporting to the Chief
Executive Officer ("CEO") of CKS with the specific objectives of:
(a) managing the location, evaluation, selection,
negotiation and completion of acquisitions of other businesses that will
contribute to the expansion of the Company's business;
(b) coordinating with the CEO, Chief Financial Officer and
other members of the senior executive team to develop and implement a plan for
such acquisitions that is consistent with the overall objectives of CKS;
(c) assisting in facilitating the transition or
assimilation of businesses acquired through the performance of his duties
hereunder;
(d) participating as a member of the senior executive
management team in developing strategy, annual operating plans and the like;
(e) being available on a consultative basis to other
members of the management team with respect to legal matters, it being
understood that Employee's responsibilities will not as a routine matter include
those associated with the position of general counsel;
(f) hiring, firing, promoting, demoting and disciplining
subordinate personnel whose duties relate to the acquisition of other
businesses, consistent with the Company's human resources policies and
procedures, and other policies;
(g) making regular reports required of other CKS corporate
officers on the Employer's operations to the CEO and to the Board of Directors
of the Company (the "Board"), as well as making other special reports as
required by the CEO and/or the Board;
(h) training such persons as may be designated by the CEO
with respect to any or all aspects of the Employer's operations.
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1.2 Time and Effort.
1.2.1 Devotion of energy to the Company. Except as provided in
section 1.2.2 below, during his employment, Employee shall devote his full
energies, interest, abilities, and productive time to the performance of this
Agreement and shall not, without the prior written consent of the Board, render
to others services of any kind for compensation, or engage in any other business
activity that would materially interfere with the performance of his duties
under this Agreement.
1.2.2 Permitted Outside Activities. Notwithstanding section 1.2.1
above, and subject to section 4.2 below, the Employee may, during the term of
this Agreement:
(i) serve on the Board of Directors of two companies
which have been clients of Employee while
Employee was a member of Xxxxxx Xxxxxxx Xxxxxxxx
& Xxxxxx ("WSGR");
(ii) provide consulting services on an occasional
basis to up to two other companies which have
been clients of Employee at WSGR;
(iii) provide other services to WSGR as may be
reasonably necessary to facilitate an orderly
transition of clients from Employee to other
attorneys at WSGR; and
(iv) participate in such civic, educational and
religious organizations as do not materially
interfere with the performance of his duties.
The Employee shall provide the Company with the name, address and telephone
number of each company upon whose board of directors he serves or to whom he
provides consulting services in accordance with the provisions of this section.
Except as set forth herein, the Employee shall not accept outside employment or
board of director membership without the prior written consent of the Company.
1.3 Employment for Unspecified Term. This Agreement provides for
employment for an unspecified term, commencing as of the date of this Agreement
and continuing until terminated by either party, as specified in Section 3
below.
1.4 Potential Future Responsibilities. Employee and the Company
contemplate, without any binding obligation, that within 12-18 months Employee
may assume different or additional responsibilities, such as heading an
operating unit of CKS. Employee and the CEO of the Company shall consider the
appropriateness of Employee assuming such new or additional responsibilities at
the time of each annual review as contemplated by section 2.3.1 below.
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2. Compensation and Benefits.
2.1 Basic Salary. Employer shall pay a basic salary to Employee
at the rate of $220,000.00 per year, payable in equal bi-weekly installments in
accordance with Employer's regular payroll practices except as otherwise agreed
in writing between Employer and Employee, provided that no salary shall be due
or payable during any period of unpaid leave, in accordance with Employer's
regular policies as they may exist or be changed from time to time. The
compensation package shall be subject to periodic review, and any modifications
thereto must be in writing signed by the parties to this Agreement.
2.2 Stock Options. On December 6, 1996, the Company granted to
Employee a nonstatutory option to purchase 150,000 shares of CKS Common Stock,
which option is evidenced by the stock option agreement attached hereto as
Exhibit A (the "Option Agreement"). In subsequent years (for example, the year
ending in May 1998), depending upon Employee's performance as evaluated by the
Employer and subject to applicable legal requirements, the Company may grant to
the Employee additional options in a manner consistent with the Employee's
status within the Company and the Company's treatment of other executives.
2.3 Bonus. Employee shall be eligible for bonus compensation as
follows:
2.3.1 Personal Bonus. Employee shall be eligible for an
annual personal bonus of up to 50% of his basic salary, in addition to any
amounts that may be payable to Employee under Section 2.3.2 below, which annual
personal bonus shall depend upon (a) his performance and (b) the availability of
funds for the payment of such a bonus, as determined by the Board. The CEO shall
evaluate the Employee's performance no later than January 31, 1998 and annually
thereafter.
2.3.1.1 Determination of Amount of Personal Bonus. Within
90 days following the commencement of the Employee's employment with the
Company, Employee and the CEO will make a good faith effort to define objective
criteria by which Employee's performance shall be evaluated for purposes of
determining Employee's eligibility for a personal bonus. If the Employee and the
Company are able to define such criteria, the Employee's personal bonus, if any,
shall be calculated pursuant to those criteria. Employee and the Company
acknowledge that definition of such criteria may prove to be impractical,
however, in which case the evaluation of Employee's performance and the
determination of the amount of personal bonus, if any, to be paid the Employee
hereunder shall be at the sole discretion of the CEO and the Board.
2.3.2 Executive Compensation Plan. Employee shall be
eligible to participate in the 1997 Executive Compensation Plan (and similar
executive compensation plans adopted in subsequent years) in accordance with the
terms and conditions of such plans.
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2.4 Employee Benefits.
2.4.1 Fringe Benefits. During his employment, Employee
shall be entitled to life insurance in accordance with Employer's regular
practice, and medical, dental and disability insurance in accordance with
Employer's group insurance plans as they exist from time to time.
2.4.1.1 Effect of disability upon fringe benefits. If
Employee becomes disabled and unable to perform his duties and the Company's
disability insurance policy does not include provisions entitling Employee and
Employee's dependents to continued coverage under the Company's medical and
dental plans (at no cost to Employee or Employee's dependents) for so long as
such disability continues, then the Company shall continue to include Employee
and Employee's dependents on the Company's medical and dental insurance plans
(as they may exist from time to time) at the Company's expense for so long as
such disability continues.
2.4.2 Automobile. During the term of this Agreement,
Employer will provide Employee a monthly automobile allowance for the
acquisition, insurance and maintenance of a vehicle for CKS business use in an
amount equal to the greater of (a) $700 per month or (b) the amount provided to
Chief Financial Officer of the Company.
2.4.3 Vacation And Holidays. Employee shall be entitled to
annual vacation which will accrue at the rate of fifteen (15) working days per
year or such greater amount as is consistent with Employer's executive vacation
practices, subject, however, to the accrual maximums now or hereafter described
in Employer's policies for the accrual of unused vacation, but in no event shall
the accrual maximum for Employee be less than fifteen (15) working days per
year. Employee shall also be entitled to holiday pay for all holidays recognized
by Employer in accordance with the Employer's regular practices.
2.5 Business Expenses. During Employee's employment, Employer
shall reimburse Employee for reasonable out-of-pocket expenses incurred in
connection with Employer's business, including travel and entertainment
expenses, food and lodging while away from home and cellular telephone expenses,
subject to such policies as Employer may from time to time establish for its
employees.
2.6 Withholding. All amounts to be paid by CKS to the Employee
are subject to applicable withholding for taxes, if any. Employer may withhold
from any and all payments, compensation or other remuneration paid to Employee
such amounts as Employer believes it is required to withhold under any federal,
state, local or foreign law, rule or regulation.
2.7 California Bar Association. For so long as Employee continues
to be employed by the Company, the Company will pay all dues and other fees
required for Employee to remain a member in good standing of the California Bar
Association and will also reimburse Employee for expenses incurred in completing
the minimum amount of continuing legal education to enable Employee to remain in
good standing of the California Bar Association.
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3. Termination.
3.1 Termination By Employer For Cause.
3.1.1 Definition of "for cause." As used in section 3.1
and its subparts, the term "for cause" means:
3.1.1.1 Violation of anti-discrimination policy. Any
violation by Employee of Employer's written policies (as they may exist from
time to time) prohibiting discrimination or harassment on the grounds of race,
sex, age or any other legally prohibited basis, provided that, for any violation
by the Employee of such policies occurring after a Change of Control (as defined
in section 3.5), (a) the Employer notifies the Employee of the facts allegedly
constituting the violation within 60 days after it acquires knowledge of such
facts, (b) the Employer affords the Employee 30 days within which to cease the
alleged violation and (c) the Employee fails to cease the alleged violation
within such 30 days.
3.1.1.2 Violation of law. Any violation by Employee of any
local, state, or federal law the violation of which is punishable other than as
an infraction.
3.1.1.3 Misconduct or dishonesty. The commission by
Employee of any material act of misconduct or dishonesty, or any material
failure to comply with the terms of the Proprietary Information Agreement
described in Section 4, below;
3.1.1.4 Material failure to achieve goals. Any material
failure to achieve goals agreed upon in writing by Employee and Employer;
provided, however, that notice of the Employer's intention to terminate
Employee's employment on the grounds of failure to achieve goals shall be given
within the fiscal quarter immediately following that in which such goals were
not achieved.
3.1.1.5 Insubordination or refusal to perform duties or
insubordination. Any insubordination or refusal by the Employee to perform the
duties described in this Agreement, provided that a Change of Control (as
defined in section 3.5) has not occurred.
3.1.2 Compensation due to Employee upon Termination by Employer
for Cause. Except as contemplated by 3.5.3 following a Change of Control, in the
event Employer terminates Employee's employment for cause, as defined in section
3.1.1, then Employee shall be entitled only to his basic salary and bonuses
earned up to and including the date on which CKS notifies him of his termination
for cause; provided, however, that if the cause for which Employee is terminated
is as defined in Section 3.1.1.4, Employer shall continue to include the
Employee and the Employee's dependents as beneficiaries of its group medical,
dental, disability and life insurance for 12 months and shall reimburse the
Employee for the cost of continuing such benefits for an additional 18 months
thereafter pursuant to the Consolidated Omnibus Budget Reconciliation Act
("COBRA") if the Employee elects to continue such benefits at the time of his
termination and executes a Severance and General Release in the form attached
hereto as Exhibit B.
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3.2 Termination By Employer Without Cause. In the event that,
without a Change of Control (as defined in section 3.5 below), the Employer
terminates the Employee's employment without cause, Employee shall be entitled
to severance compensation consisting of:
(i) continuation of Employee's basic salary (as set
forth in Section 2.1 and as it may be increased
from time to time) for twelve months following
the date on which the Employer notifies the
Employee of his termination;
(ii) bonus and incentive compensation equal to total
bonus and incentive compensation received (or
earned, but not yet received) by Employee during
the twelve months preceding the date on which the
Employer notifies the Employee of his
termination;
(iii) reimbursement by the Employer of the cost of
continuing Employee's (and Employee's
dependents') medical, disability, dental, life
and similar benefits for 12 months pursuant to
the Consolidated Omnibus Budget Reconciliation
Act ("COBRA"), if the Employee elects to continue
such benefits at the time of his termination;
(iv) continuation of his car allowance for twelve
months following the date on which the Employer
notifies the Employee of his termination; and
(v) an additional twelve months vesting on all
options held by Employee.
provided that the Employee executes a Severance and General Release Agreement in
the form attached hereto as Exhibit B.
3.2.1 Effect of Employee's subsequent employment. Employee
shall have no obligation to mitigate damages or payments due under this
paragraph; but if Employee obtains full time employment prior to the first
anniversary of the date on which his employment with CKS terminates, any income
earned by the Employee during such twelve months from Employee's new employer
shall be offset against the Company's payment obligations pursuant to section
3.2 above.
3.3 Termination By Employee for Good Reason.
3.3.1 Definition of "for good reason." As used in section
3.3 and its subparts, the term "for good reason" means any circumstances
resulting in the Employee no longer reporting to Xxxx X. Xxxxxx as CEO of CKS,
provided that the Employee terminates his employment within 120 days after the
date on which the Employee first reports to someone other than Xx. Xxxxxx.
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3.3.2 Compensation due to Employee Upon Termination by
Employee for Good Reason. In the event that the Employee terminates his
employment for good reason, as defined in section 3.1.1, the Employee shall be
entitled to severance compensation consisting of:
(i) continuation of Employee's basic salary (as set
forth in Section 2.1 and as it may be increased
from time to time) for twelve months following
the date on which the Employee notifies the
Company of his termination;
(ii) bonus and incentive compensation equal to total
bonus and incentive compensation received (or
earned, but not yet received) by Employee during
the twelve months preceding the date on which the
Employee notifies the Company of his termination;
(iii) reimbursement by the Employer of the cost of
continuing Employee's (and Employee's
dependents') medical, disability, dental, life
and similar benefits for 12 months pursuant to
the Consolidated Omnibus Budget Reconciliation
Act ("COBRA"), if the Employee elects to continue
such benefits at the time of his termination;
(iv) continuation of car allowance for twelve months
following the date on which the Employee notifies
the Company of his termination; and
(v) an additional twelve months vesting on all
options held by Employee.
provided that the Employee executes a Severance and General Release Agreement in
the form attached hereto as Exhibit B.
3.3.3 Effect of Employee's subsequent employment. Employee
shall have no obligation to mitigate damages or payments due under this
paragraph; but if Employee obtains full time employment prior to the first
anniversary of the date on which his employment with CKS terminates, any income
earned by the Employee during such twelve months from Employee's new employer
shall be offset against the Company's payment obligations pursuant to section
3.3.2 above.
3.4 Termination by Employee Without Cause. Employee shall have
the right to terminate his employment without cause by notifying the Company 30
days in advance of the date on which his employment is to terminate. Should
Employee elect to terminate employment without cause (and without Good Reason):
(i) Employee shall not be entitled to severance
compensation of any kind;
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(ii) Employee shall not be entitled to exercise stock
options except for vested shares (which shall be
exercisable in accordance with the Option
Agreement); and
(iii) Employee shall forfeit any and all right to any
bonus compensation pursuant to Section 2.3 during
the year in which employment is terminated;
provided, however, that if Employee elects to
terminate employment under this section within
the 90 days prior to the end of the Employer's
fiscal year, Employee shall receive a pro rata
share of the bonus which would be provided to
Employee under the 1977 Executive Compensation
Plan (or any similar compensation plan in
subsequent years) in accordance with the terms
and conditions of such plan; provided, however,
that if Employee has earned bonus compensation
for the prior fiscal year, but such bonus has not
yet been paid to Employee, Employee shall be
entitled to such bonus compensation.
3.5 Involuntary or Constructive Termination Following a Change of
Control.
3.5.1 Definition of "Constructive Termination." As used in
section 3.5 and its subparts, "Constructive Termination" shall mean:
(a) without the Employee's express written consent, (i)
a significant reduction of the Employee's duties, position or responsibilities
relative to the Employee's duties, position or responsibilities in effect
immediately prior to such reduction, or (ii) the removal of the Employee from
such position, duties and responsibilities, unless the Employee is provided with
a comparable position, duties and responsibilities;
(b) a substantial reduction, without the Employee's
express written consent, of the facilities and perquisites (including office
space and location) available to the Employee immediately prior to such
reduction;
(c) a reduction by the Company of the Employee's base
salary or bonuses paid in comparison with the prior year;
(d) a material reduction by the Company in the kind or
level of employee benefits to which the Employee is entitled, with the result
that the Employee's overall benefits package is significantly reduced;
(e) any reduction, after a Change of Control, in the
disability benefits available to Employee prior to the Change of Control;
(f) the relocation of the Employee to a facility or a
location more than twenty (20) miles from his current location without the
Employee's express written consent, or
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(g) the failure of the Company to obtain the assumption
of this Agreement by any successors contemplated in Section 6.10 below;
(h) an increase of 10% or more in the number of days
which the Employee travels outside of Santa Xxxxx, San Mateo, San Francisco,
Santa Xxxx, Contra Costa or Alameda Counties, in comparison with the number of
such days in the 12 months preceding the Change of Control (or, if Employee has
not been employed for 12 months at the time of the Change of Control, the number
of days determined by dividing the days Employee did travel by the number of
days Employee was employed, and multiplying the result by 365);
provided that, with respect to subparagraphs (b), (d) and (e)
above, (i) the Employee notifies the Company of the facts allegedly constituting
his Constructive Termination and his intention to terminate his employment
within 30 days after he acquires knowledge of such facts, (ii) the Employee
affords the Company 30 days within which to remedy the alleged Constructive
Termination and (iii) the Company fails to remedy the alleged Constructive
Termination within such 30 days.
3.5.2 "Change of Control." As used in section 3.5 and its
subparts, "Change of Control" shall mean:
(a) the approval by shareholders of the Company of a
merger or consolidation of the Company with any other corporation, other than a
merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) at least fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation, or the approval by
the shareholders of the Company of a plan of complete liquidation of the Company
or an agreement for the sale or disposition by the Company of all or
substantially all of the Company's assets.
(b) Any "person" (as such term is used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended, but
excluding officers of CKS and the Director of the Interpublic Group) becoming
the "beneficial owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing 50% or more of the total
voting power represented by the Company's then outstanding voting securities;
(c) A change in the composition of the Board of
Directors of the Company occurring within a two-year period, as a result of
which fewer than a majority of the directors are Incumbent directors. "Incumbent
Directors" shall mean directors who either (i) are directors of the Company as
of the date hereof, or (ii) are appointed, or nominated for election to the
Board of Directors of the Company with the affirmative votes of at least a
majority of the Incumbent Directors at the time of such election or nomination
in connection with an actual or threatened proxy contest relating to the
election of directors of the Company.
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3.5.3 Acceleration of Vesting Following Change of
Control. On the effectiveness of any Change of Control, the vesting of all
options granted to Employee by the Company shall be accelerated so that, as to
each such option, one half of the shares subject to such option which were not
otherwise vested at the effective time of the Change of Control shall become
vested at such effective time, and the remaining unvested shares shall continue
to vest thereafter at the same rate (number of shares per month) as was in
effect prior to the Change of Control.
3.5.4 Compensation due to Employee Upon Involuntary or
Constructive Termination Following a Change in Control. If, following a Change
of Control as defined above, the Employee's employment is terminated
involuntarily (for any reason) or by Constructive Termination, the Employer
shall
(i) pay to Employee in a single lump sum an amount
equal to (A) 12 months basic salary (at the rate
in effect prior to the Change of Control or the
date of termination, whichever is greater), plus
(B) the total amount paid to or earned by
Employee as incentive compensation or bonus
payments during the twelve months preceding the
Change of Control or date of termination,
whichever is greater,
(ii) reimburse Employee for the cost of continuing
Employee's (and Employee's dependents') medical,
disability, dental, life and similar benefits for
12 months pursuant to the Consolidated Omnibus
Budget Reconciliation Act ("COBRA"), if the
Employee elects to continue such benefits at the
time of his termination;
(iii) continue for a period of twelve months to provide
the car allowance, professional association dues
and continuing legal education benefits enjoyed
by Employee immediately prior to the Change of
Control, and
(iv) accelerate the vesting of all then unvested
options held by the Employee at the date of
termination such that those shares shall vest
immediately and Employee shall have two years
following the date of such termination in which
to exercise all options held by Employee at the
date of such termination;
provided that the Employee executes a Severance and General Release Agreement in
the form attached hereto as Exhibit B. In the event a Change of Control occurs
before Employee has been employed for twelve (12) months, Employee shall for
purposes of clause (i) above be deemed to have earned the maximum bonus for
which he is eligible during the twelve (12) months preceding Change in Control.
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3.5.5 Effect of Employee's subsequent employment. Employee
shall have no obligation to mitigate damages or payments due under this
paragraph, nor shall any amounts earned by Employee be offset against the
amounts payable to Employee under Section 3.5 and its subsections.
3.6 Termination By Death or Permanent Disability.
3.6.1 Definition of "Permanent Disability." For the
purpose of section 3.7 and its subparts, the term "Permanent Disability" means
the Employee's inability to perform his duties hereunder (with or without
reasonable accommodation) for 120 or more working days during any twelve-month
period.
3.6.2 Effect of Death or Permanent Disability of Employee.
The Employee's employment will terminate automatically upon the death or
Permanent Disability of Employee, in which case Employee or his estate will be
entitled only to compensation earned through the date of such death or Permanent
Disability; provided, however, that, in the event of a Permanent Disability,
Employer will continue to include Employee and Employee's dependents on the
Company's medical and dental insurance plans (as they may exist from time to
time) for so long as such disability continues at the Company's expense.
3.7 Effect of Dispute Regarding Nature of Termination. In
the event that the parties disagree on the nature of the termination of the
Employee's employment (such as whether a termination was for cause or not) and
submit such dispute to arbitration, the effective date of the termination of the
Employee's employment shall be determined as if no dispute arose. In the event
that the parties disagree on whether a Constructive Termination or Change in
Control has occurred and submit such dispute to arbitration, the Employee shall
be deemed to have terminated his employment without cause in the event if the
arbitrator determines that a Constructive Termination or Change in Control did
not occur.
4. Trade Secrets and Confidential Information.
4.1 Proprietary Information. Employee recognizes that as
an executive of the Employer, Employee occupies a position of trust with respect
to much business information of a secret or confidential nature which is the
property of the Employer and which will be imparted to Employee from time to
time in the course of Employee's duties. Employee therefore agrees that Employee
shall not, at any time, whether in the course of his employment or thereafter,
use or disclose directly or indirectly to any person outside the Employer any of
such information, except as required in the ordinary course of Employee's duties
under this Agreement. Concurrently with the execution of this Agreement,
Employee shall sign the Proprietary Information Agreement attached hereto as
Exhibit C (the "Proprietary Information Agreement").
4.2 Non-Competition with Employer. During his employment, and so
long as this contract remains in effect and any payments or benefits are
provided to the Employee, the Employee shall not, directly or indirectly,
promote, participate, or engage in any activity or other business
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competitive with Employer's business, or any of its affiliates, and shall not
solicit the Company's employees or customers, or the employees or customers of
any of Employer's affiliates, nor shall Employee engage in any act or conduct
which creates, or appears to create, a conflict of interest with Employer,
except as may be approved in writing by the CEO; provided, however, that this
section 4.2 shall not apply if Employee is terminated involuntarily or by
constructive termination following a Change of Control.
5. Miscellaneous.
5.1 Notice. All notices, requests and other communications
required or permitted to be given hereunder shall be in writing and shall be
deemed given (a) upon receipt, if given by personal delivery; (b) upon delivery,
if given by electronic facsimile, with proof of receipt; and (c) upon the third
business day following mailing, if mailed by deposit in the United States mail,
with certification and postal charges prepaid, addressed as follows (or such
other address as either party may provide to the other from time to time).
If to Employer:
CKS Group, Inc.
0000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attn: President and Chief Executive Officer
Fax: (000) 000-0000
If to Employee:
Xxxxxx X. Xxxxxxxx
0000 Xxxxxxxx Xxxxxx
Xxxxxxxx Xxxx, XX 00000
Fax: (000) 000-0000
5.2 Delegation of Duties. Employee may not delegate the services
and obligations he is required to perform under this Agreement. Any attempt by
Employee to delegate his duties hereunder shall be null and void.
5.3 Amendment. This Agreement may be modified or amended only by
and to the extent of the written agreement of Employer and Employee.
5.4 Previous Agreements. This Agreement, together with the
Proprietary Information Agreement and the Stock Option Agreement, contains the
entire agreement between the parties and supersedes all prior oral and written
agreements, understandings, commitments, and practices between the parties,
including all prior employment or consulting agreements, whether or not fully
performed before the date of this Agreement.
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5.5 Governing Law. Except as provided by section 5.8 below, this
Agreement shall be governed by and construed in accordance with the internal
laws of the State of California.
5.6 Section Headings. The various section headings are inserted
for convenience of reference only and shall not affect the meaning or
interpretation of this Agreement or any section thereof.
5.7 Severability. If provision of this Agreement is held by a
court of competent jurisdiction to be invalid, illegal or unenforceable, such
provision will be deemed amended to the minimum extent necessary to conform to
applicable law so as to be valid, legal and enforceable; if such provision
cannot be amended as provided above, it will be stricken and the remainder of
this Agreement will remain in full force and effect.
5.8 Arbitration. It is further understood and agreed that if, at
any time, a violation of any term of this Agreement is asserted by any party
hereto, that party shall have the right to seek specific performance of that
term and/or any other necessary and proper relief, including but not limited to
damages, before an arbitrator as set forth below. Each party will pay its own
costs and attorneys fees. The Company shall pay the costs of the arbitrators.
The parties agree that if they have any dispute as to the terms of or
obligations created by this Agreement, or should either party to this Agreement
have any dispute as to Employee's termination or compensation, or should
Employee allege that Employer or any of its employees, managers, officers,
directors or other representatives has violated any of Employee's rights under
state or federal civil rights laws including, but not limited to, the California
Fair Employment and Housing Act (Cal. Gov. Code Sections 12900, et seq.), the
Civil Rights Act of 1964 (42 U.S.C. Sections 2000e, et seq.), the Equal Pay Act
of 1963 (29 U.S.C. Sections 206(d)), the Americans With Disabilities Act of 1990
(42 U.S.C. Sections 12101, et seq., or California Labor Code Section 1102.1,
they will submit any such dispute to final and binding arbitration before a
neutral arbitrator selected from the roster of Judicial Arbitration and
Mediation Services, or before any other neutral, and pursuant to any other such
procedures, as the parties may agree upon. To be timely, any such dispute must
be referred to arbitration within twelve (12) months of the incident or
complaint giving rise to the dispute; disputes not referred to arbitration
within such twelve (12) twelve month period shall be deemed waived, and the
arbitrator shall deny any untimely claims. THE PARTIES EXPRESSLY AGREE THAT SUCH
ARBITRATION SHALL BE THE EXCLUSIVE, FINAL AND BINDING REMEDY FOR ANY DISPUTE
INVOLVING OR RELATED TO AN ALLEGED BREACH OF THIS AGREEMENT, EMPLOYMENT
TERMINATION, COMPENSATION, THE VIOLATION OF XX. XXXXXXXX'X CIVIL RIGHTS, OR ANY
OTHER MATTER ARISING OUT OF OR RELATED TO XX. XXXXXXXX'X EMPLOYMENT, AND HEREBY
EXPRESSLY WAIVE ANY RIGHT THEY HAVE OR MAY HAVE TO A COURT TRIAL OR A JURY TRIAL
OF ANY SUCH DISPUTE. In making an award, the arbitrator shall have no power to
add to, delete from or modify this Agreement, or to enforce purported unwritten
agreements or prior agreements, or to construe implied terms or covenants into
the Agreement, the parties being in agreement that no such oral or implied terms
or covenants or unwritten agreements or prior agreements are intended by them to
remain enforceable, to the extent they may ever have been so. In reaching his or
her decision, the arbitrator shall adhere to the relevant law and applicable
precedent and shall have no power to vary therefrom. In
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construing this Agreement, its language shall be given a fair and reasonable
construction in accordance with the intention of the parties, and without regard
to, or the aid of, Section 1654 of the California Civil Code. At the time of
issuing a decision, the arbitrator shall (in the decision or separately) make
specific findings of fact and shall set forth such facts as support the
decision, as well as his conclusions of law, and the reasons and bases for his
opinion, and such a decision incorporating these elements shall be a condition
precedent to its enforcement. The decision of the arbitrator shall be final and
binding; provided, however, that in the event the arbitrator exceeds the powers
or jurisdiction here conferred, or fails to issue a decision in conformance
herewith, it is specifically agreed that the aggrieved party may petition a
court of competent jurisdiction to correct or vacate such award, and that the
arbitrator's act of exceeding his or her powers shall be grounds for granting
such relief. It is further agreed by the parties that venue for any arbitration
proceedings shall be Santa Xxxxx County, California. This arbitration clause is
entered pursuant to, and shall be governed by, the Federal Arbitration Act (9
U.S.C. Section 1, et seq.), but in all other respects this agreement shall be
governed by the provisions of California law. If any one or more provisions of
this arbitration clause shall for any reason be held invalid or unenforceable,
it is the specific intent of the parties that such provisions shall be modified
to the minimum extent necessary to make it or its application valid and
enforceable.
5.9 Waiver. Waiver of any default or breach of this Agreement or
of any warranty, representation, covenant or obligation contained herein shall
not be construed as a waiver of any subsequent breach.
5.10 Successors.
(a) Company's Successors. Any successor of the Company
(whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) to all or substantially all of the
Company's business and/or assets shall assume the Company's obligations under
this Agreement and agree expressly to perform the Company's obligations under
this Agreement in the same manner and to the same extent as the Company would be
required to perform such obligations in the absence of a succession. For all
purposes under this Agreement, the term "Company" shall include any successor to
the Company's business and/or assets which executes and delivers the assumption
agreement described in this subsection (a) or which becomes bound by the terms
of this Agreement by operation of law.
(b) Employee's Successors. Except as otherwise provided in
this Agreement, the terms of this Agreement and all rights of the Employee
hereunder shall inure to the benefit of, and be enforceable by, the Employee's
personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.
5.11 Notice of Termination. Any termination of this Agreement by
the Company for cause or by the Employee with cause or without cause or
following a Change in Control or Constructive Termination shall be communicated
by a notice of termination to the other party hereto given in accordance with
this Section 5.11. Such notice shall indicate the specific termination provision
in this Agreement relied upon, shall set forth in reasonable detail the facts
and
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circumstances claimed to provide a basis for termination under the provision so
indicated, and shall specify an effective date of termination which shall be no
more than 30 days after the giving of such notice.
IN WITNESS WHEREOF, the parties have executed this Agreement in one or
more counterparts which, taken together, shall constitute one agreement.
EMPLOYER:
CKS GROUP, INC.
By:/s/ Xxxx X. Xxxxxx
-----------------------------------------
Xxxx X. Xxxxxx
President and Chief Executive Officer
Date: February 1, 1997
---------------------------------------
EMPLOYEE:
/s/ Xxxxxx X. Xxxxxxxx
--------------------------------------------
Xxxxxx X. Xxxxxxxx
Date: February 1, 1997
---------------------------------------
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