EXHIBIT 10.27
EMPLOYMENT AGREEMENT
This Employment Agreement is entered into by and between Xxxx Xxxxx
("EMPLOYEE") and XMP Acquisition Corp. (the "COMPANY") effective as of August
29, 2000, which date also represents the closing of the acquisition by the
Company, a wholly-owned subsidiary of iGo Corporation, a Delaware corporation
(individually or collectively, "IGO") of certain assets of Xtend Micro Products,
Inc. (the "TRANSACTION"), such date being hereafter referred to as the
"EFFECTIVE DATE" of this Agreement.
WHEREAS, the Employee is and intends to remain an employee of the
Company or iGo for the foreseeable future and as such possesses confidential
business and technical information regarding the business of the Company and
iGo; and
WHEREAS, the Company and iGo are willing to enter into this Agreement
as a condition to the closing of the Transaction;
NOW, THEREFORE, in consideration of the mutual agreements and
obligations contained in this Agreement, the parties agree as follows:
1. TERM OF AGREEMENT. This Agreement shall commence on the Effective
Date and shall have a term of two (2) years.
2. DUTIES. Employee shall be employed as the Company's Vice President
of Product Development and the Acting Director of Operations, and shall perform
for the Company such duties as may be designated by the Company from time to
time in a mutually acceptable position to both Employee and the Company.
Employee shall devote his or her full time, effort and attention during regular
business hours to the business and affairs of the Company. The parties
acknowledge and agree that it is iGo's current intention (without further
obligation) to move the Company's operations to iGo's headquarters in Reno,
Nevada, at some time following the Effective Date, and that Employee shall be
required to be a resident of the Reno, Nevada metropolitan area or Incline
Village after such time. Such move and the requirement that Employee relocate in
connection with such move shall not constitute a breach of any terms of this
Agreement by the Company (or iGo) nor shall it give rise to any claim of
constructive termination of Employee's employment without cause.
3. AT-WILL EMPLOYMENT. The Company and Employee acknowledge that
Employee's employment is at-will, as defined under applicable law. Any
representation to the contrary is unauthorized and not valid unless obtained in
writing and signed by the Chief Executive Officer of the Company. If Employee's
employment terminates for any reason, the Employee shall not be entitled to any
payments, benefits, damages, award or compensation other than as provided in
this Agreement, or as may otherwise be available in accordance with the
Company's established written plans and written policies at the time of
termination.
4. COMPENSATION. For the duties and services to be performed by
Employee hereunder, the Company shall pay Employee, and Employee agrees to
accept, the salary, stock options, bonuses and other benefits described below in
this Section 4.
(a) SALARY. Employee shall receive a base salary of
$150,000.00 per annum, payable in accordance with the Company's normal payroll
practices.
(b) STOCK OPTIONS AND OTHER INCENTIVE PROGRAMS. Employee shall
be eligible to participate in the stock option or other incentive programs
available to employees of the Company. Employee will receive a stock option to
purchase up to 50,000 shares of iGo's Common Stock that will vest over a four
(4) year period, with twenty-five percent (25%) vesting on the first anniversary
of the Effective Date, and the remainder vesting monthly thereafter. These
options will be priced on the Effective Date.
(c) BONUSES. Employee will be eligible to receive a cash bonus
of up to $5,000.00 quarterly, for an annual total of up to $20,000.00 (maximum).
$2,500.00 of the quarterly bonus shall be tied to net sales and gross margin
targets for the Company. For the purpose of bonus calculations, net sales is
defined as "sell-in" for OEM accounts (less a reasonable provision for returns
for defective product) and "sell-thru" for channel accounts (distributors,
resellers and corporate accounts). For each quarter the net sales targets will
be respectively, $2,900,000, $3,300,000, $3,800,000 and $4,900,000. The first
quarter will start on the Effective Date of this agreement. If the Effective
Date occurs on a date other than the last or first day of a calendar month, the
operating results of the Company for the period between the Effective Date and
the beginning of the first full calendar month following the Closing shall be
included within the first quarter following the Effective Date. If the Effective
Date occurs on the first day of a calendar month, then the measurement period
shall be deemed to begin on the date of the Effective Date. In order to be
eligible for any net sales bonus, a minimum quarterly gross margin of at least
38% must be achieved. If 100% of the net sales target is achieved, 100% of the
net sales bonus will be paid. If between 80% and 99% of the net sales target is
achieved, 50% of the net sales bonus will be paid. No net sales bonus will be
paid for net sales less than 80% of the quarterly target. The remaining
$2,500.00 of the quarterly bonus shall be tied to product development
initiatives. Each quarter one to five product development objectives will be
mutually agreed upon by the Company and Employee. Each of these objectives will
be worth an equal proportion of the quarterly product development bonus. For
example, if two product development objectives are established for a quarter,
each objective will be worth $1,250.00. Employee's entitlement to incentive
bonuses from the Company is discretionary and shall be determined by the Board,
its Compensation Committee or the Chief Executive Officer of the Company in good
faith based Employee's individual performance and the Company's financial and
nonfinancial performance during the applicable bonus period.
(d) ADDITIONAL BENEFITS. Employee will be eligible to
participate in the Company's employee benefit plans of general application,
including without limitation, those plans covering medical, dental and paid
vacation in accordance with the rules established for individual participation
in any such plan and under applicable law. Employee will be eligible for
vacation and sick leave in accordance with the policies in effect during the
term of this Agreement and will receive such other benefits as the Company
generally provides to its employees of similar rank and grade.
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(e) REIMBURSEMENT OF RELOCATION EXPENSES. In the event that
iGo requests that Employee relocate to the Reno, Nevada metropolitan area or
Incline Village (which request shall not be made earlier than the first
anniversary of the Effective Date), the Company shall reimburse Employee for
relocation expenses as follows: (i) $25,000.00 relocation bonus; (ii) the actual
moving expenses, not to exceed $7,000.00, associated with a single relocation of
Employee's household goods and personal property from the location of Employee's
current primary residence to Employee's primary residence in the Reno, Nevada
metropolitan area or Incline Village.
5. SALARY CONTINUATION.
(a) TERMINATION OF EMPLOYMENT. In the event Employee's
employment terminates for any reason during the original term of this Agreement,
then Employee shall be entitled to receive salary continuation as follows:
(i) VOLUNTARY RESIGNATION. If Employee's employment
terminates by reason of Employee's voluntary resignation (and is not an
Involuntary Termination or a Termination for Cause), then Employee shall not be
entitled to receive salary continuation. Employee's benefits will be continued
under the Company's then existing benefit plans and policies solely in
accordance with such plans and policies in effect on the date of termination.
(ii) INVOLUNTARY TERMINATION. If Employee's
employment is terminated as a result of Involuntary Termination other than for
Cause, Employee will be entitled to receive salary continuation equal to
Employee's regular monthly salary for the number of months remaining in the
original term of this Agreement (the "Salary Continuation Period"). Such
payments shall be made ratably over the Salary Continuation Period according to
the Company's standard payroll schedule. Employee's benefits will be continued
under the Company's then existing benefit plans and policies solely in
accordance with such plans and policies in effect on the date of termination.
(iii) INVOLUNTARY TERMINATION FOR CAUSE. If
Employee's employment is terminated for Cause, then Employee shall not be
entitled to receive salary continuation. Employee's benefits will be continued
under the Company's then existing benefit plans and policies solely in
accordance with such plans and policies in effect on the date of termination.
b. OTHER EMPLOYMENT. In the event Employee commences new
employment with a company whose business or proposed business constitutes a
"Competing Business" within the "Restricted Territory" as such terms are defined
in the Non-Competition Agreement of even date herewith between the Company,
Employee and iGo, then any salary continuation pursuant to this Section 5 shall
cease.
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6. DEFINITION OF CAUSE. For purposes of this Agreement, "cause" shall
mean (i) any material breach of this Agreement by Employee, which breach, if
curable, is not cured within thirty (30) days of written notice thereof, (ii)
any act or acts of gross misconduct by Employee, (iii) conduct grossly
insubordinate or disloyal to the Company or iGo, (iv) the conviction of or
pleading guilty or no contest to a felony, or (v) the continued use of illegal
drugs or alcohol by Employee such that Employee becomes impaired in the
performance of his duties hereunder, in each case (i)-(v), as determined by the
Company's Board of Directors in good faith. Employee expressly acknowledges and
agrees that any breach by Employee of his obligations pursuant to Section 7 or
Section 8 below shall be deemed "uncurable" for purposes of clause (i) above.
7. CONFIDENTIALITY AGREEMENT. Employee shall sign iGo's standard
employee agreement regarding confidentiality and assignment of inventions
Agreement, the general form of which is attached hereto as EXHIBIT A.
8. NON-SOLICITATION. Employee agrees that during and for five years
after the period of providing services to the Company or iGo, Employee will not
directly or indirectly induce, encourage or solicit any employee or consultant
of iGo, the Company or any other affiliate of iGo or the Company to terminate
their employment or consulting relationship with such entity for any reason;
provided that the foregoing shall not preclude the Employee from engaging in
general employment advertising.
9. SUCCESSORS. Any successor to 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 obligations under this Agreement and agree expressly to perform the
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. The terms of this Agreement and all of Employee's rights hereunder
shall inure to the benefit of, and be enforceable by, Employee's personal or
legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.
10. NOTICE. Notices and all other communications contemplated by this
Agreement shall be in writing and shall be deemed to have been duly given when
personally delivered or when mailed by U.S. registered or certified mail, return
receipt requested and postage prepaid. Mailed notices to Employee shall be
addressed to Employee at the home address from which Employee most recently
communicated to the Company in writing. In the case of the Company, mailed
notices shall be addressed to it care of iGo's headquarters in Reno, Nevada, and
all notices shall be directed to the attention of iGo's Chief Financial Officer.
11. MISCELLANEOUS PROVISIONS.
(a) WAIVERS, ETC. No amendment of this Agreement and no waiver
of any one or more of the provisions hereof shall be effective unless set forth
in writing by such person against whom enforcement is sought.
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(b) SOLE AGREEMENT. This Agreement, including the Exhibit
hereto, constitutes the sole agreement of the parties and supersedes all oral
negotiations and prior writings with respect to the subject matter hereof.
(c) AMENDMENT. This Agreement may be amended, modified,
suppressed or canceled only by an agreement in writing executed by both parties
hereto.
(d) CHOICE OF LAW. The validity, interpretation, construction
and performance of this Agreement shall be governed by the laws of the State of
California, without giving effect to the principles of conflict of laws.
(e) SEVERABILITY. If any term or provision of this Agreement
or the application thereof to any circumstance shall, in any jurisdiction and to
any extent, be invalid or unenforceable, such term or provision shall be
ineffective as to such jurisdiction to the extent of such invalidity or
unenforceability without invalidating or rendering unenforceable the remaining
terms and provisions of this Agreement or the application of such terms and
provisions to circumstances other than those as to which it is held invalid or
unenforceable, and a suitable and equitable term or provision shall be
substituted therefor to carry out, insofar as may be valid and enforceable, the
intent and purpose of the invalid or unenforceable term or provision.
(f) COUNTERPARTS. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together will constitute one and the same instrument.
[Signature page follows.]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date.
XMP ACQUISITION CORP. EMPLOYEE
By: /S/ XXXX XXXXXXX By: /S/ XXXX XXXXX
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Xxxx Xxxxxxx, Chief Financial Officer Xxxx Xxxxx
IGO CORPORATION
By: /S/ XXXX XXXXXXX
------------------------------------------
Xxxx Xxxxxxx, Chief Financial Officer
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EXHIBIT A
CONFIDENTIALITY AND ASSIGNMENT OF INVENTIONS AGREEMENT
In exchange for my becoming employed (or my employment being continued)
by or retained as a consultant (or my consulting relationship being continued)
by iGo Corporation, or its subsidiaries, affiliates, or successors (hereinafter
referred to collectively as the "Company"), I hereby agree as follows:
1. I will perform for the Company such executive or managerial duties
as may be designated by the Company from time to time. During my period of
employment or consulting relationship with the Company, I will devote my best
efforts to the interests of the Company and will not engage in other employment
or in any activities detrimental to the best interests of the Company without
the prior written consent of the Company.
2. As used in this Agreement, the term "Inventions" means designs,
trademarks, discoveries, formulae, processes, techniques, trade secrets,
inventions, improvements, ideas or copyrightable works, including all rights to
obtain, register, perfect and enforce these proprietary interests.
3. As used in this Agreement, the term "Confidential Information" means
information pertaining to any aspects of the Company's business which is either
information not known by actual or potential competitors of the Company or is
proprietary information of the Company or its customers or suppliers, whether of
a technical nature or otherwise.
4. Without further compensation, I hereby agree promptly to disclose to
the Company, and I hereby assign and agree to assign to the Company or its
designee, my entire right, title, and interest in and to all Inventions which I
may solely or jointly develop or reduce to practice during the period of my
employment or consulting relationship with the Company (a) which pertain to any
line of business activity of the Company, (b) which are aided by the use of
time, material or facilities of the Company, whether or not during working
hours, or (c) which relate to any of my work during the period of my employment
or consulting relationship with the Company, whether or not during normal
working hours. No rights are hereby conveyed in Inventions, if any, made by me
prior to my employment or consulting relationship with the Company which are
identified in a sheet attached to and made a part of this Agreement, if any
(which attachment contains no confidential information), or to an Invention
which is developed entirely on my own time without using the Company's
equipment, supplies, facilities, or information derived through my relationship
with the Company except for those inventions that either (a) relate at the time
of conception or reduction to practice of the invention to the Company's
business, or actual or demonstrably anticipated research, development or
business plans of the Company or (b) result from any work performed by me for
the Company. I agree to disclose in writing all Inventions made by me in
confidence to the Company to permit a determination as to whether or not the
Inventions should be the property of the Company.
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5. I agree to perform, during my employment or consulting relationship,
all acts deemed necessary or desirable by the Company to permit and assist it,
at its expense, in obtaining and enforcing the full benefits, enjoyment, rights
and title throughout the world in the Inventions hereby assigned to the Company
as set forth in paragraph 4 above. Such acts may include, but are not limited
to, execution of documents and assistance or cooperation in legal proceedings.
6. If, during my employment or consulting relationship, the Company is
unable for any reason to secure my signature to apply for or to pursue any
application for any United States or foreign letters patent or mask work or
copyright registration covering inventions, mask works or original works of
authorship assigned to the Company as above, then I hereby irrevocably designate
and appoint the Company and its duly authorized officers and agents as my agent
and attorney in fact, to act for and in my behalf and stead to execute and file
any such applications and to do all other lawfully permitted acts to further the
prosecution and issuance of letters patent or mask work or copyright
registrations thereon with the same legal force and effect as if executed by me.
I hereby waive and quitclaim to the Company any and all claims, of any nature
whatsoever, which I now or may hereafter have for infringement of any patents,
mask works or copyrights resulting from any such application for letters patent
or mask work or copyright registrations assigned hereunder to the Company.
7. I agree to hold in confidence and not directly or indirectly to use
or disclose, either during or after termination of my employment or consulting
relationship with the Company, any Confidential Information I obtain or create
during the period of my employment or consulting relationship, whether or not
during working hours, except to the extent authorized by the Company, until such
Confidential Information becomes generally known. I agree not to make copies of
such Confidential Information except as authorized by the Company. Upon
termination of my employment or consulting relationship or upon an earlier
request of the Company, I will return or deliver to the Company all tangible
forms of such Confidential Information in my possession or control, including
but not limited to drawings, specifications, documents, records, devices, models
or any other material and copies or reproductions thereof.
8. I agree to abide faithfully by all Company rules, regulations and
policies approved, written or electronically published and made known to me from
time to time.
9. I represent that my performance of all the terms of this Agreement
and as an employee of or consultant to the Company does not and will not breach
any agreement to keep in confidence proprietary information, knowledge or data
acquired by me in confidence or in trust prior to my becoming an employee or
consultant of the Company, and I will not disclose to the Company, or induce the
Company to use, any confidential or proprietary information or material
belonging to any previous employer or others. I agree not to enter into any
agreement either written or oral in conflict with the provisions of this
Agreement.
10. I agree that during and for one year after the period of my
providing services to the Company, I will not encourage or solicit any employee
or consultant of the Company to leave the Company for any reason.
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11. I understand and agree that the Company's customer list as well as
all information pertaining to customers are regarded by the Company as a prime
and principal asset, and therefore will be held strictly confidential at all
times. I therefore agree never to use such client information for any purpose
other than the regular business of the Company and agree this information is the
sole property of the Company.
12. I certify that, to the best of my information and belief, I am not
a party to any other agreement which will interfere with my full compliance with
this Agreement.
13. I agree to indemnify and hold the Company harmless from and against
(i) any and all claims, demands, proceedings, suits and actions against the
Company, and (ii) any and all losses, liabilities, damages, costs suffer by the
Company, resulting from any breach of this agreement.
14. This Agreement (a) shall survive my employment by or consulting
relationship with the Company, (b) does not in any way restrict my right to
terminate my employment or consulting relationship, (c) inures to the benefit of
successors and assigns of the Company, and (d) is binding upon my heirs and
legal representatives.
15. I understand and agree that any dispute under this Agreement shall
be submitted to binding arbitration in Reno, Nevada under the Rules of
Arbitration of the American Arbitration Association by a panel of three (3)
arbitrators appointed in accordance with such rules. Judgment on the arbitration
award by such arbitrator may be entered in any court of competent jurisdiction.
Notwithstanding the foregoing, I or the Company may apply to any court of
competent jurisdiction for preliminary injunctive relief pending the outcome of
any such arbitration without breach of this arbitration provision. It is agreed
that the prevailing party in any legal action or arbitration proceeding brought
by one party against the other and arising out of this Agreement shall be
entitled, in addition to any other rights and remedies that such prevailing
party may have, to reimbursement for expenses incurred by such prevailing party,
including court costs and reasonable attorneys' fees.
16. I agree that my obligations provided herein are necessary and
reasonable in order to protect the Company and its business, and expressly agree
that monetary damages may be inadequate to compensate the Company for any breach
by me of my covenants and agreements set forth herein. Accordingly, I agree and
acknowledge that, in addition to any other remedies that may be available, in
law, in equity or otherwise in a proceeding pursuant to Section 15 above or
otherwise, the Company shall be entitled to obtain injunctive relief against the
threatened breach of this Agreement or the continuation of any such breach by
me, without the necessity of proving actual damages.
17. I REPRESENT AND ACKNOWLEDGE THAT I HAVE BEEN ADVISED BY THE COMPANY
TO SEEK INDEPENDENT LEGAL COUNSEL (SEPARATE AND APART FROM COUNSEL TO THE
COMPANY) IN CONNECTION WITH THE REVIEW AND EXECUTION OF THIS AGREEMENT AND HAVE
HAD AMPLE OPPORTUNITY TO DO SO.
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18. I certify and acknowledge that I have carefully read all of the
provisions of this Agreement and that I understand and will fully and faithfully
comply with such provisions.
Dated: 8-29-00 EMPLOYEE/CONSULTANT
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/S/ XXXX XXXXX
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Xxxx Xxxxx
Accepted and Agreed: IGO CORPORATION
By: /S/ XXXX XXXXXXX
------------------------------------
Xxxx Xxxxxxx
Chief Financial Officer
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ATTACHMENT
LIST OF INVENTIONS
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