EXHIBIT 10.22
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made as of the 19th of January, 1999, by and
between VALUE AMERICA, INC., a Virginia corporation (the "Company"), and Xxxxx
Xxxx (the "Employee").
In consideration of the mutual covenants contained herein, the Company and
the Employee agree as follows:
1. Employment. The Company agrees to employ the Employee and the Employee
agrees to continue in the employ of the Company on the terms and conditions
hereinafter set forth.
2. Capacity. The Employee shall serve the Company in such positions or
offices with such authority, titles and duties as may be prescribed from time to
time by the President, Chief Executive Officer or Board of Directors (the
"Board") of the Company, and shall serve the Company in such other or additional
offices in which he may be requested to serve from time to time.
3. Effective Date and Term. The commencement date of this Agreement shall
be January 19, 1999 (the "Commencement Date"). Subject to the provisions of
Section 6, the term of the Employee's employment hereunder shall be for two
years from the Commencement Date; provided, however, that the term shall be
extended automatically for an additional period of one year commencing on the
second anniversary of the Commencement Date and on each subsequent anniversary
thereafter, unless either the Employee or the Company gives written notice to
the other, at least thirty (30) days prior to the date of any such anniversary,
of such party's election not to extend the term of this Agreement. The last day
of such term, as so extended from time to time, is herein sometimes referred to
as the "Expiration Date."
4. Compensation and Benefits. The regular compensation and benefits
payable to the Employee under this Agreement shall be as follows:
(a) Salary. For all services rendered by the Employee under this
Agreement, the Company shall pay the Employee a total annual salary as agreed to
subject to increase or decrease at any time and, from time to time, in the sole
discretion of the Company. The Employee's salary shall be payable in periodic
installments in accordance with the Company's usual payroll practices.
(b) Regular Benefits. The Employee shall also be entitled to
participate in any employee benefit plans, medical insurance plans, life
insurance plans, disability income plans, retirement plans, bonus incentive
plans and other benefit plans from time to time in effect for all employees of
the Company. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company and
(iii) the discretion of the Board or any administrative or other committee
provided for in or contemplated by such plan.
(c) Business Expenses. The Company shall reimburse the Employee for
all reasonable travel and other business expenses incurred by him in the
performance of his duties and responsibilities, subject to such requirements
with respect to substantiation and documentation as may be specified by the
Company.
(d) Vacation. The Employee shall be entitled to such number of weeks
of vacation per year as shall be provided for in Company's employee handbooks,
or as otherwise agreed to, as modified from time to time, to be taken at such
times and intervals as shall be determined by the Employee with the approval of
the Company.
(e) Other Incentives. The Company may, but shall not be obligated
to, provide the Employee with such other performanced-based compensation,
benefits or incentives as shall be established, amended or thereafter terminated
from time to time by and in the sole discretion of the Board or the compensation
committee thereof, and in considering any such compensation, benefits or
incentives, the Board or such committee may consider such factors as the
Employee's performance, productivity and contribution to the Company's
profitability.
5. Extent of Service. During his employment hereunder, the Employee
shall, subject to the direction and supervision of the President, Chief
Executive Officer and Board, devote his full business time, best efforts and
business judgment, skill and knowledge to the advancement of the Company's
interests and to the discharge of his duties and responsibilities hereunder. The
Employee shall not engage in any other business activity during normal business
hours, except as may be approved by the President, Chief Employee Officer or
Board of the Company.
6. Termination.
Notwithstanding the provisions of Section 3, the Employee's
employment hereunder shall terminate under the following circumstances and shall
be subject to the following provisions:
(a) Death. In the event of the Employee's death during the
Employee's employment hereunder, the Employee's employment shall terminate on
the date of his death and the Employee or his estate shall be entitled to no
further compensation or benefits under this Agreement; provided, however, that
the Company shall continue to pay an amount equal to the Employee's salary to
the Employee's beneficiary designated in writing to the Company prior to his
death (or to his estate, if he fails to make such designation) for a period of
one month after the date of the Employee's death, at the salary rate in effect
on the date of his death, said payments to be made on the same periodic dates as
salary payments would have been made to the Employee had he not died.
(b) Termination by the Company for Cause. The Employee's employment
hereunder may be terminated without further liability on the part of the Company
effective immediately by the Company (acting through its President, Chief
Executive Officer or Board), for Cause by written notice to the Employee setting
forth in reasonable detail the nature of such Cause. Upon termination of
employment by the Company for Cause, the Employee shall be entitled to no
further compensation or benefits under this Agreement. Only the following shall
constitute "Cause" for such termination:
(i) gross incompetence, gross negligence, willful misconduct
in office or breach of a material fiduciary duty owed to the Company, or any
subsidiary or affiliate thereof;
(ii) conviction of a felony, a crime of moral turpitude or
commission of an act of embezzlement or fraud against the Company, or any
subsidiary or affiliate thereof;
(iii) any material breach by the Employee of a material term
of this Agreement or any other agreement between the Employee and the Company,
including without limitation material failure to perform a substantial portion
of his duties and responsibilities hereunder; continued failure, after
reasonable notice from the Company, to adhere to or satisfy any production,
performance or other standards established by the Company and communicated to
the Employee; or unauthorized use or disclosure of Confidential Information or
trade secrets of the Company; or
(iv) dishonesty or fraud of the Employee with respect to the
Company, or any subsidiary or affiliate thereof.
(c) Termination by the Employee. The Employee may terminate his
employment hereunder by written notice to the President, Chief Executive Officer
or Board. Upon termination of employment by the Employee, the Employee shall be
entitled to no further compensation or benefits under this Agreement.
(d) Termination by the Company Without Cause. The Employee's
employment with the Company may be terminated without Cause by the Company
(acting through its President, Chief Executive Officer or Board), effective
immediately by written notice to the Employee. Upon termination of employment by
the Company without Cause, the Company shall pay to the Employee within fifteen
(15) days after the date of termination cash in the amount of (i) any unpaid
salary due to the Employee hereunder through the date of the termination, plus
(ii) any accrued but unpaid vacation pay due to the Employee.
(e) No Termination Benefits. In the event of any termination of the
Employee's employment hereunder for any reason (including without limitation
pursuant to Sections 3, 6(a), 6(b), 6(c), 6(d) or Section 7 hereof), the
Employee shall not be entitled to any salary, bonus, severance pay or benefits
not otherwise specified herein.
(f) Litigation and Regulatory Cooperation. The Employee shall
reasonably cooperate with the Company in the defense or prosecution of any
claims or actions now in existence or which may be brought in the future against
or on behalf of the Company, which relate to events or occurrences that
transpired while the Employee was employed by the Company. The Employee's
reasonable cooperation in connection with such claims or actions shall include,
but not be limited to, being reasonably available to meet with counsel to
prepare for discovery or trial and to act as a witness on behalf of the Company,
at mutually convenient times and locations. The Employee shall also reasonably
cooperate with the Company in connection with any examination or review of any
federal or state regulatory authority as any such examination or review relates
to events or occurrences that transpired while the Employee was employed by the
Company. If such cooperation is required after the Employee ceases to be
employed by the Company, the Company shall pay the Employee for such cooperation
a fee of twenty five dollars ($25.00) per hour, payable monthly in arrears, and
will reimburse the Employee for any reasonable out-of-pocket expenses incurred
in connection therewith.
7. Developments, Noncompete and Confidential Information. Simultaneous
with his execution of this Agreement, and as a material part of the
consideration for the Company's entering into this Agreement, the Employee
agrees to execute, comply with the terms of and become bound by a Developments,
Noncompete and Nondisclosure Agreement with the Company in the form of Exhibit A
attached hereto, the terms of which (a) are incorporated into this Agreement in
their entirety, (b) are deemed for all purposes to be a part of this Agreement,
and (c) shall survive any termination of this Agreement.
8. Conflicting Agreements. The Employee hereby represents and warrants
that the execution of this Agreement and the performance of his obligations
hereunder will not breach or be in conflict with any other agreement to which he
is a party or by which he is bound, and that he is not subject to any covenants
against competition or similar covenants which would affect the performance of
his obligations hereunder.
9. Withholding. All payments made by the Company under this Agreement
shall be net of any tax or other amounts required to be withheld by the Company
under applicable law.
10. Arbitration of Disputes. Any controversy or claim arising out of or
relating to the employment relationship between the Employee and the Company
shall be settled by arbitration in accordance with the laws of the Commonwealth
of Virginia by three arbitrators, one of whom shall be appointed by the Company,
one by the Employee and the third by the first two arbitrators. If the first two
arbitrators cannot agree on the appointment of a third arbitrator, then the
third arbitrator shall be appointed by the American Arbitration Association in
the City of Richmond. Such arbitration shall be conducted in the City of
Richmond in accordance with the rules of the American Arbitration Association,
except with respect to the selection of arbitrators which shall be as provided
in this Section 11. Judgment upon the award rendered by the arbitrators may be
entered in any court having jurisdiction thereof. Each party shall bear their
own costs and attorney's fees.
11. Assignment; Successors and Assigns, etc. Neither the Company nor the
Employee may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party or parties; provided, however, that the Company may assign its rights
under this Agreement without the consent of the Employee in the event that the
Company shall hereafter effect a reorganization, consolidation with or merges
into any other Person, or transfer all or substantially all of its properties or
assets to any other Person. This Agreement shall inure to the benefit of and be
binding upon the Company and the Employee, their respective successors,
subsidiaries, affiliates, executors, administrators, heirs and permitted
assigns. In the event of the Employee's death prior to the completion by the
Company of all payments due him under this Agreement, the Company shall continue
such payments to the Employee's beneficiary designated in writing to the Company
prior to his death (or to his estate, if he fails to make such designation).
12. Enforceability. If any portion or provision of this Agreement shall to
any extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Agreement, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.
13. Waiver. No waiver of any provision hereof shall be effective unless
made in writing and signed by the waiving party or parties. The failure of any
party to require the performance of any term or obligation of this Agreement, or
the waiver by any party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.
14. Notices. Any notices, request, demands and other communications
provided for by this Agreement shall be sufficient if in writing and delivered
in person or sent by registered or certified mail, postage prepaid (in which
case notice shall be deemed to have been given on the third day after mailing),
or by overnight delivery by a reliable overnight courier service (in which case
notice shall be deemed to have been given on the day after delivery to such
courier service) to the Employee at the last address the Employee has filed in
writing with the Company or, in the case of the Company, at its main offices,
attention of its President or Chief Executive Officer.
15. Amendment. This Agreement may be amended or modified only by a written
instrument signed by the Employee and by a duly authorized representative of the
Company.
16. Governing Law. This is a Virginia contract and shall be construed
under and be governed in all respects by the laws of the Commonwealth of
Virginia.
17. Entire Agreement. This Agreement, the Developments, Noncompete and
Nondisclosure Agreement referred to in Section 8, and any Incentive Stock Option
Agreement entered into by the Company and the Employee constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all prior or contemporaneous written or oral agreements or
understandings with respect to the subject matter hereof.
18. Legal Counsel. Employee has reviewed the contents of this Agreement
and fully understands its terms. Employee acknowledges that he/she is fully
aware of his right to the advice of counsel independent from that of the
Company, that the Company has advised him/her of such right and disclosed to
him/her the risks in not seeking such independent advice, and that he/she
understands the potentially adverse interests of the parties with respect to
this Agreement. Employee further acknowledges that no representations have been
made with respect to the income or estate tax or other consequences of this
Agreement to him/her and that he/she has been advised of the importance of
seeking independent advice of counsel with respect to such consequences.
IN WITNESS WHEREOF, this Agreement has been executed as a sealed
instrument by the Company, and by the Employee, as of the date first above
written.
VALUE AMERICA, INC.
By: Xxxxxx Xxxxxxx
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Title: Chief Operating Officer
Date: 9/20/98
Xxxxx X. Xxxx, Employee
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Date: 1/19/99
Address: 000 Xxxxxxxxx
Xxxxxxxxxxxxxxx, Xxxxxxxx
