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EXHIBIT 10.50
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made as of the 26th day of November, 1996
by and between Capitol Multimedia, Inc., a Delaware corporation ("Employer" or
"Company"), and Xxxxxx Xxxxxx ("Employee").
WITNESSETH
WHEREAS, Employee desires to serve as Chief Financial Officer and
Secretary / Treasurer of the Company, the Company desires to employ Employee as
Chief Financial Officer and Secretary / Treasurer of the Company, and Employee
and the Company desire to embody in this Agreement the terms and conditions
under which Employee shall be employed;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Employee and the Company,
intending to be legally bound hereby, AGREE AS FOLLOWS:
1. EMPLOYMENT, DUTIES AND RESPONSIBILITIES OF EMPLOYEE
(a) Duties of Employee. Employee shall perform such services and
assume such duties and responsibilities as are prescribed for the Chief
Financial Officer and Secretary / Treasurer of the Company, subject to the
general supervision of the Board of Directors of the Company, and in all
respects use his best efforts to further enhance and develop the Company's
business, affairs, interests, welfare and value.
(b) Full Time and Attention. Employee shall not, without prior
written consent of the Employer, render services of a business, commercial, or
professional nature to any other person or organization or take on
responsibilities that would otherwise materially interfere in any way with the
Employee's obligations under this Agreement other than for transition service
to the Employee's previous employer. The transition service will be limited to
5 days over a period of time from the employment start date to January 31,
1997.
2. TERM OF AGREEMENT
The term of this agreement shall be December 16, 1996 through December
31, 1997 (the "Initial Term"). This Agreement may be terminated by either
party before the end of the Initial Term as described in Section 3 of this
Agreement. In the event if the notice about the termination of this Agreement
is not given to the Employee by the end of the Initial Term, the Agreement
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will automatically renew for a two-year term beginning January 1, 1998 and
ending December 31, 1999 (the "Second Term"). The Initial Term and the Second
Term shall be referred to as the "Term."
3. TERMINATION OF EMPLOYMENT
(a) Termination by the Company For Cause. The Employer may terminate
this Agreement prior to the expiration of either the Initial Term or the Second
Term by sending Employee written notice of such termination for Cause. The
date of such notice shall be the date of Employee's termination. If the Company
terminates Employee's employment for Cause, Employee shall not receive any pay
or benefits described herein. For purposes of this Agreement, "Cause" shall
mean: (1) dishonesty or fraud resulting in injury to the business of the
Company; (2) embezzlement or theft of assets of the Company; (3) breach of
Section 7 of this Agreement; (4) a substantial breach of this Agreement; (5)
conviction for a felony resulting in damage to the business of the Company or
its Affiliates; or (6) any other willful misconduct by Employee which is
materially injurious to the Company, monetarily or otherwise. Employee may be
terminated for Cause only by the affirmative vote of a majority of the Board of
Directors, provided that Employee shall have at least ten days written notice
of the meeting at which the Board of Directors will consider such Employee's
termination and will be afforded the opportunity to address the Board of
Directors and present evidence regarding the absence of cause.
(b) Termination by the Company or Employee Without Cause. The
Company may terminate this Agreement without cause only during the Initial
Term, effective upon 90 days written notice to the Employee. However, in case
of a change of the CEO of the Company during the Initial Term, the Company may
terminate this Agreement effective upon twelve months written notice to the
Employee.
The Employee may terminate his employment with the Company during the
Second Term with not less than 30 days written notice.
In case the Company decides not to enter into a similar agreement with
the Employee after the expiration of the Second Term of this Agreement, the
Company will notify the Employee no later than 6 months before the expiration
date of the Second Term of this Agreement.
Upon the termination of employment under this subparagraph by either
Employee or Company, all wages and benefits to which Employee would otherwise
be entitled shall terminate.
(c) Death. This Agreement shall terminate upon the death or
disability of Employee for a period of not less than ninety (90) days. Any
compensation payable pursuant to this Agreement from and after Employee's death
shall be paid to Employee's estate or one or more beneficiaries as designated
in writing by Employee.
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(d) Delivery of Material. Employee agrees that upon the termination
of this Agreement, he will deliver to the Company all documents, papers,
materials and other property of the Company relating to its affairs which may
then be in his possession or under his control.
4. COMPENSATION OF EMPLOYEE
As compensation and consideration for the performance by Employee of
his obligations under this Agreement, Employee shall be entitled to the
following:
(a) Base Salary. During the Term, the Company shall pay to Employee a
base salary totaling One Hundred Thirty Thousand Dollars ($130,000) per annum
(the "Base Salary"). Termination of Employee's employment under Section 3 of
this Agreement shall discharge the Company from its obligation to pay Base
Salary for the remainder of the Term, except as otherwise provided herein. The
Base Salary shall be payable in regular bi-weekly intervals, and shall be
subject to such withholding and other normal employee deductions as may be
required by law. This Base Salary may be increased by the President of the
Company and approved by the Compensation Committee of the Board of Directors of
the Company. The Employee's performance will be evaluated annually.
(b) Benefits. Employee shall be eligible to participate during
the Term in such life insurance, health, disability and major medical insurance
benefits, pension, and such other employee benefit plans and programs for the
benefit of the employees of the Company, as may be maintained from time to
time, in each case to the extent and in the manner available to other employees
of the Company, and subject to the terms and provisions of such plan or
programs. The level of benefits to which Employee shall be entitled, if
determined by the level of Employee's annual compensation, shall include for
purposes of such calculation any performance bonus payments to be made to
Employee pursuant to paragraph (c) below.
(c) Annual Bonus. The Employee shall be eligible for an annual
bonus to be determined by the Compensation Committee of the Board of Directors
of the Company.
(d) Vacations and Holidays.
A. The Employee shall be entitled to four weeks paid
vacation and two weeks paid sick leave during the year of his employment under
the Agreement.
B. Employee shall be entitled to all holidays applicable
to all other company employees.
(e) Non-Qualified Stock Options. The Company shall grant options to
the Employee, pursuant to the Company's Employee Stock Option Plan, for the
purchase of 75,000 shares of common stock at a per share price equal to the
market price of the Company's common stock on December 16, 1996, the date of
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hire. 15,000 will vest the date of hire. 20,000, 20,000, and 20,000 options
shall vest on December 31st of 1997, 1998, and 1999, respectively. Such
options shall expire five years from their respective vesting dates. Any and
all unvested options; however, expire automatically upon termination as
described in Section 3 of this Agreement.
5. CONFIDENTIALITY
(a) Confidentiality. Employee acknowledges that during the course
of his employment with the Company he will, from time to time, be invested with
confidential information relating to the business practices, products, product
plans, development ideas and schedules and other confidential and proprietary
information regarding the Company. Employee hereby agrees to keep all such
information confidential. Employee also agrees that he will not, except as
required in the conduct of Company business, or as authorized in writing by the
Company, publish, disclose or make use of any such information or knowledge
unless and until such information or knowledge shall have ceased to be secret
or confidential without his fault.
(b) Exclusive Property. All business records, papers and other
documents kept or made by Employee relating to the business of the Company or
an Associated Company shall be and remain the property of the Company. Upon
the termination of his employment with the Company or upon the request of the
Company at any time, Employee shall promptly deliver to the Company, and shall
retain no copies of, any written materials, records and documents made by
Employee or coming into his possession concerning the business or affairs of
the Company or an Associated Company other than personal notes or
correspondence of Employee not containing proprietary information relating to
such business or affairs.
(c) Inventions, Rights to Improvements. Employee hereby sells,
transfers and assigns to the Company any right, title and interest in any and
all inventions, improvements, discoveries, and ideas (whether or not patentable
or copyrightable) (collectively the "Intellectual Property") which Employee may
make or conceive during the term of this Agreement, and which relate to or are
applicable to any phase of the Company's business. Employee hereby agrees to
communicate promptly and disclose to the Company all information, details and
data pertaining to the aforementioned Intellectual Property and to execute any
document and do any act reasonably necessary to perform Employee's duties under
this Section 6(c). Employee also affirms that if any such Intellectual
Property shall be deemed confidential by the Company, he will not disclose any
such Intellectual Property without prior written authorization from a majority
of the members of the Company's Board of Directors.
(d) Survival of Section. The provisions of this Section 5 shall
survive the termination of this Agreement for any reason whatsoever.
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6. EXCLUSIVITY / NON-COMPETITION
(a) Exclusivity / Non Competing Employment. The Employee agrees that
for a period of twelve months subsequent to his termination of employment for
any reason other than non-renewal of this Agreement after the Initial Term, he
will not compete directly or be employed in any way by individuals, companies,
interests or entities that compete directly with the Company. The Employee
also acknowledges that for six months subsequent to his termination of
employment for any reason other than non-renewal of this Agreement, that he
will not utilize the CompanyGs customer lists for any business related purpose.
(b) No Interference. During the twelve months subsequent to his
termination, Employee shall not, whether for his own account or for the account
of any other individual, partnership, firm, corporation or other business
organization which is engaged in marketing or selling a product or products
similar to any product sold by the Company, intentionally solicit, endeavor to
entice away from the Company, or otherwise interfere with the relationship of
the Company with any person who is employed by the Company, or any person or
entity who is, or was within the most recent twelve-month period, a customer or
client of the Company.
(c) Stock Ownership. Nothing in this Agreement shall prohibit
Employee from acquiring or holding any securities of any company listed on a
national securities exchange or quoted on the automated quotation system of the
National Association of Securities Dealers, Inc., provided that at any time
during the six months subsequent to his termination Employee and members of his
immediate family do not own more than five percent (5%) of any voting
securities of any company engaged in the same type of business of the Company.
(d) Survival of Section. The provisions of this Section 6 shall
survive the termination of this Agreement for any reason whatsoever.
7. REMEDIES
(a) Specific Performance. Employee hereby acknowledges that a
breach of Sections 5 or 6 of this Agreement may result in material irreparable
injury to the Company for which there is no adequate remedy at law, that it
will not be possible to measure damages for such a breach, and that in the
event of such a breach or threat thereof the Company shall be entitled to
obtain a temporary restraining order, a preliminary injunction, and a permanent
injunction restraining Employee from engaging in activities prohibited by this
Agreement. Employee further acknowledges that in the event of such a breach or
threat thereof the Company shall be entitled to obtain such other or further
relief as may be required to specifically enforce any of the covenants of this
Agreement. Employee hereby agrees and consents that such injunctive or other
relief may be sought ex parte in any state or federal court in the Commonwealth
of Massachusetts or in the state and county in which such violation may occur
or in any other court having jurisdiction, at the election
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of the Company. Employee agrees to and hereby does submit to in personam
jurisdiction before each and every such court for that purpose.
(b) Suspension of Payments. Employee hereby acknowledges that
should a breach of Sections 5 or 6 of this Agreement occur, the Company shall
be entitled to offset against payments otherwise due Employee hereunder any
damages incurred by the Company with respect to such breach.
(c) Remedies not Exclusive. The remedies of this Section shall be
cumulative and not exclusive, and shall be in addition to any other remedy
which the Company may have.
(d) Survival of Remedies. This Section 7 shall survive the
termination of this Agreement for any reason whatsoever.
8. NOTICES
All notices given hereunder shall be in writing and shall be deemed
delivered when served personally or on the third business day after being
deposited in the United States mail, certified or registered mail, postage
prepaid, addressed as follows:
If to the Company:
Capitol Multimedia, Inc.
000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attention: CEO
Telecopier: (000) 000-0000
If to Employee:
Xxxxxx Xxxxxx
00 Xxxxxxxxxx Xxxx
Xxxxxxx, Xxx Xxxxxxxxx 00000
fax: (000) 000-0000
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Any party may change its address for notices by communicating its new
address in writing to the other party.
9. MISCELLANEOUS
(a) Agreement is Non-Assignable. This Agreement is a personal
service contract and shall not be assignable by Employee or by the Company,
except that the Company may assign this Agreement to a Person which succeeds to
the Company's rights and liabilities by merger, sale of assets as a going
concern,
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or consolidation with the Company.
(b) Binding Effect. All rights and obligations and agreements of
the parties under this Agreement shall be binding upon and enforceable against,
and inure to the benefit of the parties and their personal representatives,
heirs, legatees and devises, and any Person succeeding by operation of law to
their rights under this Agreement, except that such personal representatives,
heirs, legatees, devises and other persons shall have no obligation to perform
Employee's duties described in Section 1 hereof.
(c) Representations. Employee and the Company each represent and
warrant that there are no restrictions, agreements or limitations on their
rights or ability to enter into and perform the terms of this Agreement.
(d) Further Assurances. Employee and the Company, as the case may
be, shall execute and deliver such further instruments and do such further acts
and things as may be required to carry out the terms or conditions of this
Agreement or as may be consistent with the intent and purpose of this
Agreement.
(e) Rights of Third Parties. Nothing in this Agreement, expressed
or implied, is intended to confer upon any person other than the parties hereto
any rights or remedies under or by reason of this Agreement.
(f) Effect of Waiver. A waiver of, or failure to exercise, any
rights provided for in this Agreement, in any respect, shall not be deemed a
waiver of any further or future rights hereunder. Except for rights which must
be exercised within a specified time period under this Agreement, no rights
herein shall be considered as waived, whether intentionally or not, unless
waived in a writing signed by the party to be charged with the waiver.
(g) Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware applicable to
contracts made and performed in that jurisdiction, without regard to the
principles of conflicts of laws.
(h) Amendments. This Agreement may not be changed or amended orally,
but only by an agreement in writing signed by all parties hereto.
(i) Counterparts. This Agreement may be executed in several
counterparts, each of which shall be an original, and such counterparts shall
together constitute but one and the same instrument.
(j) Severability. If a court of competent jurisdiction declares that
any term or provision of this Agreement is invalid or unenforceable, then:
(1) the remaining terms and provisions hereof shall be
unimpaired, and
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(2) the invalid or unenforceable term or provision shall be
deemed replaced by a term or provision that is valid and enforceable
and that comes closest to expressing the intention of the invalid or
unenforceable term or provision.
(k) Captions. The captions to the Sections contained in this
Agreement are for reference only, do not form a substantive part of this
Agreement, and shall not restrict or enlarge any substantive provision of this
Agreement.
(l) Entire Agreement. This Agreement supersedes all prior
agreements, oral or written, between the parties hereto with respect to the
employment of Employee by the Company. This Agreement contains the entire
agreement of the parties with respect to the subject matter hereof, and the
parties shall not be bound by any terms, conditions, statements, covenants,
representations or warranties, oral or written, not herein contained.
IN WITNESS WHEREOF, the parties have executed this Employment
Agreement effective as of the date first written above.
Capitol Multimedia, Inc.,
a Delaware corporation
By: /s/ L. Kopeikina /s/ Xxxxxx Xxxxxx 11/30/96
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Xxxxxx Xxxxxx
Its: President
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