EXHIBIT 99.12
EMPLOYMENT AND COMPENSATION AGREEMENT
This Employment and Compensation Agreement (the "Agreement") is entered into in
Contra Costa County, California, as of the 13th day of November, 1998, by and
between Finet Holdings Corporation, a Delaware corporation ("Finet") and
collectively herein ("Employer") and Xxxxx Xxxxxx ("Employee"), who agree as
follows:
1. Employment.
(a) Employer hereby offers Employee employment with Employer, and Employee
hereby accepts employment, commencing on November 13, 1998 on the terms and
conditions contained in this Agreement.
(b) Employee shall serve as the sole Vice President- Research and Development of
Finet Holdings Corporation. In that capacity, Employee shall faithfully and
diligently carry out such duties and have such responsibilities as are customary
among persons employed in substantially similar capacities for similar companies
provided that Employee shall at all times be subject to the direction of the
Company's President. Employee agrees to the best of its ability and experience
to perform loyally and conscientiously all of the duties and responsibilities
required of him, either expressly or implicitly, by the terms of this Agreement.
(c) Location of Employee's employment shall be in the San Francisco Bay area.
(d) Addendum A is hereby incorporated into this Agreement.
2. Term of Employment. Specified in Addendum A.
3. Commitment. Except as is otherwise provided herein, during the Term, of
Employment Employee shall devote one hundred (100%) percent of his entire
productive time, ability, and attention to the business of the Employer not
withstanding the foregoing employee may serve on Boards of Directors of other
entities. Except as is otherwise provided herein, Employee shall not render any
services of a commercial or professional nature to any other person or
organization, whether for compensation or otherwise. However, the expenditure of
reasonable amounts of time for educational, charitable, or professional
activities shall not be deemed a breach of this Agreement if those activities do
not materially interfere with the services required under this Agreement and
shall not require prior written consent. Notwithstanding the foregoing, this
Agreement shall not be interpreted to prohibit Employee from making passive
personal investments or conducting private business affairs if those activities
do not materially interfere with the services required under this Agreement.
4. Competitive Activities.
(a) During the Term of Employment, Employee shall not, directly or indirectly,
own an interest in, operate, join, control, or participate in, or be connected
as an officer, employer., agent, independent contractor, partner, shareholder or
principal of any corporation, partnership, proprietorship, firm, association,
person, or other entity producing, designing. providing, soliciting orders for,
selling, distributing or marketing products, goods, equipment, or services that
compete directly or indirectly with Employees products and services or Employees
business, without first obtaining the written approval of Employer. Such
approval my be rescinded by Employer if and when, in the opinion of Employer,
such activities materially inhibit Employee's performance under this Agreement
or place Employer at risk.
(b) During the Term of Employment and the Posttermination Period, Employee shall
not, directly or indirectly, either for himself or for any other person, firm,
or corporation, divert or take away or attempt to divert or take away (and
during the Posttermination Period, call on or solicit or attempt to call on or
solicit) any of Employees customers or patrons, not including those on whom he
called or whom he solicited or to whom he catered or with whom he became
acquainted prior to his engagement by Employer. Nothing herein shall limit
Employee's right during the Posttermination Period, to call on or solicit or
attempt to call on or solicit any of Employee's customers or patrons on whom he
called or whom he solicited or to whom he catered or with whom he became
acquainted during the period prior to his engagement by Employer.
(c) During the Term of Employment, Employee shall not undertake planning for or
organization of any business activity competitive with Employer's business or
combine or join with other employees or representatives of Employer's business
for the purpose of organizing any such competitive business activity.
(d) During the Term of Employment and the Posttermination Period, Employee shall
not, directly or indirectly or by action in concert with others, induce or
influence (or seek to induce or influence) any person who is engaged (as an
employee, agent, independent contractor, or otherwise) by Employer to terminate
his employment or engagement.
5. Compensation.
(a) As compensation for the services to be rendered by Employee hereunder during
the Term of Employment, Employer shall pay Employee a Base Salary and additional
compensation based upon the performance of Employee, as is more specifically set
forth in Addendum A to this Agreement ("Adjusted Base Salary").
(b) Employee's Adjusted Base Salary, will be payable in accordance with
Employees customary payroll practices.
6. Benefits. In addition to the compensation described herein above, during the
Term of Employment, Employee shall be eligible to receive the following
benefits:
(a) Such health insurance and other benefits that Employer may, from time to
time, make available to Employer's employees.
(b) Vacation time, sick leave, and personal time in accordance with Employer's
vacation and absence policies, which Employer may, from time to time, maintain
for employees at Employee's level of employment.
(c) Reimbursement of reasonable business expenses, upon submission of
documentation in accordance with Employer's regular expense reimbursement
policies, for reasonable business expenses incurred on behalf of Employer by
Employee.
(d) Participation in any savings plan, 401(k) plan, profit sharing plan or
Pension Plan, which Employer may, from time to time, maintain for employees at
Employee's level of employment, subject to plan eligibility.
7. Confidential Information.
(a) Employee recognizes that, during the course of his employment with Employer,
he will be exposed to certain nonpublic, confidential information, the
disclosure of which to third parties would cause competitive injury to Employer.
Such confidential information includes but is not limited to Employer's
investment plans or strategies, trade secrets, sources of supply, customer
lists, lists of potential customers, customer or consultant contracts and the
details thereof, pricing policies, operational methods, marketing and
merchandising plans or strategies, business acquisition plans, personnel
acquisition plans, unannounced products and services, research and development
activities, processes, formula, methods, techniques, technical data, know-how,
inventions, designs, financial or accounting data, inventory reports, production
schedules, cost and sales data, strategies, forecasts, and all other information
that is not publicly available pertaining to the business of Employer or any of
its affiliates. Such confidential information is hereinafter referred to as
"Confidential Information".
(b) Confidential Information shall not include (i) any information which is or
becomes publicly available other than through breach of this Agreement, or (ii)
any information which is or becomes known or available to Employee on a
non-confidential basis and not in contravention of applicable law from a source
which is entitled to disclose such information to Employee.
(c) Employee agrees that he will not, while he is employed by Employer, divulge
Confidential Information to any person, directly or indirectly, except to
Employer or its officers and agents, or as reasonably required in connection
with his duties on behalf of the Employer, except as is required by law or court
order. Employee further agrees not to use, except on behalf of the Employer, any
Confidential Information acquired by Employee during the Term of Employment.
Employee agrees that he will not at any time after his employment with Employer
has ended, divulge to any person, directly or indirectly, any Confidential
Information, except as is required by law or court order. Employee further
agrees that, if his relationship with the Employer is terminated for any reason,
he shall not take with him but will leave with Employer all records, papers, and
computer software and data, and any copies thereof relating to the Confidential
Information (or if such papers, records, computer software and data, or copies
are not on the premises of Employer, Employee agrees to return such papers,
records, and computer software and data immediately upon his termination).
Employee acknowledges that all such papers, records, computer software and data,
or copies thereof are and remain the property of Employer.
8. Voice Mail and Electronic Mail. All voice mail and electronic; mail on
Employees telephone or computer systems are the property of Employer and shall
be non-personal, non-private and non-privileged to Employer and Employee shall
disclose to Employer all codes or passwords necessary for Employer to access
such voice mail or electronic mail.
9. Cooperation. As a condition of his employment with Employer, Employee agrees
that he will not disrupt, damage, impair, or interfere with the business of the
Employer, such as by interfering with the duties of the Employer's employees,
disrupting relationships with Employees customers, agents, representatives, or
vendors, or otherwise.
10. Termination.
(a) Employee may terminate this Agreement for any reason or for no reason upon
providing Employer with sixty (60) days prior written notice of his intention to
terminate.
(b) Employer may terminate this Agreement upon written notice to Employee prior
to its expiration date for just cause or due to the Employee's death or
substantial physical impairment which prevents Employee from performing his
duties and responsibilities as set forth herein. For purposes of this Section,
"just cause" is defined as a violation of Section(s) 3., 4., 7., or 9. hereof,
fraud, misappropriation of funds, embezzlement, theft, physical assault on
another person, drunkenness on the job, possession or use of narcotics on
Employer's property, willful and material damage to Employer's property,
conviction of a felony, repeated or material violations of Employer's policies.
(c) In the event Employee's employment is terminated, whether by Employer for
"just cause", as is defined herein, or Employee as provided herein, Employer
shall have no further obligation to pay any compensation to or benefits on
behalf of Employee, however all compensation accrued a-s of the date of
termination shall be paid to Employee within forty five (45) days of
termination.
(d) In the event Employee's employment is terminated by Employer without "just
cause"`, or if a person or entity gains ownership of over 35% of the outstanding
shares of Finet, or if responsibilities of employee are materially modified
without Employee's consent, provisions and obligations in Addendum A shall be
applicable. All share grants and options or warrants shall fully vest upon the
date of employment termination or acquisition of 35% of outstanding shares.
Employee shall have up to 90 days from termination date to exercise such options
or warrants.
(e) Upon termination of his employment, Employee agrees to deliver promptly to
Employer all records, files, drawings, documents, specifications, blueprints,
letters, notes, reports and computer software, and all copies thereof, and any
and all materials relating to Employer's Confidential Information that is in his
possession or control. At the time of termination, Employee will have an exit
interview with Employer wherein Employee will certify that Employee has returned
to Employer all tangible Confidential Information disclosed to him, and disclose
Inventions conceived or developed by him during the Term of Employment.
(f) Sections 4., 7., 10., 11., 12., 13., 14., 15., and 16., hereof, shall
survive termination of this Agreement.
11. Assignment. The rights and liabilities of the parties hereto shall bind and
inure to the benefit of their respective successors, executors and
administrators, as the case may be; provided that, as Employer has specifically
contracted for Employee's services, Employee may not assign or delegate his
duties and responsibilities under this Agreement either in whole or part without
the prior written consent of Employer.
12. Severability of Provisions. In the event any provision of this Agreement is
held to be illegal, invalid, or unenforceable under any present or future law,
(a) such provision will be fully severable, (b) this Agreement will be construed
and enforced as if such illegal, invalid, or unenforceable provision had never
comprised a part hereof (c) the remaining provisions of this Agreement will
remain in fall force and effect and will not be affected by the illegal,
invalid, or unenforceable provision or by its severance herefrom, and (d) in
lieu of such illegal, invalid, or unenforceable provision, there will be added
automatically as a part of this Agreement a legal, valid, and enforceable
provision as similar in terms to such illegal, invalid, or unenforceable
provision as may be possible.
13. Mediation and Arbitration. Initially all claims and controversies of any
kind relating to this Agreement shall be submitted to mediation pursuant to the
services of an established mediation service with the venue of the mediation
being San Francisco, CA. In the event the matter cannot be disposed of by
mediation, all claims and controversies of any kind relating to this Agreement
shall be finally settled by binding arbitration before a single arbitrator in
San Francisco, CA, in accordance with the rules then in effect from the American
Arbitration Association. All parties to this Agreement shall be bound by the
decisions in an any such arbitration, and judgment upon such arbitration may be
entered by any court of proper jurisdiction. Attorney's fees and costs shall be
allocated by agreement in mediation or by the arbitrator in arbitration.
14. Notices. Any notice provided for in this Agreement must be in writing and
must be either personally delivered, or mailed by certified mail (postage
prepaid and return receipt requested), or sent by reputable overnight courier
service, to the recipient at the address below indicated:
To Employee: Xxxxx Xxxxxx
To Employer: President
Finet Holdings Corporation
0000 Xxxxxx Xxxxxx, #000
Xxxxxx Xxxxx, XX 00000
,or such other address or to the attention of such other person as the
recipient party shall have specified by prior written notice to the sending
party. Any notice under this Agreement will be deemed to have been given when so
delivered or if mailed, five (5) days after deposit in a U.S. Postal facility.
15. Entire Agreement: Amendments and Waivers. This Agreement contains the sole,
complete, final, exclusive and entire agreement between the parties pertaining
to the employment of Employee by Employer and supersedes all prior agreements,
understandings, negotiations and discussions, whether oral or written, of the
parties. No amendment, supplement, modification, rescission or waiver of this
Agreement shall be binding unless executed in writing by the parties. No waiver
of any of the provisions of this Agreement shall be deemed or shall constitute a
continuing waiver unless otherwise expressly provided. The parties expressly
acknowledge that they have not relied upon any prior agreements, understandings,
negotiations or discussions, whether oral or written.
16. Choice of Law. The rights and duties of the parties will be governed by the
law of the State of California, excluding any choice-of-law rules that would
require the application of laws of any other jurisdiction.
17. Insurance. Employee shall cooperate at no cost to him with Employer, should
Employer wish to purchase key-man insurance on Employee's life.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
Employer Employee
By: /s/ Xxxxxx Xxxxxxx By: /s/ Xxxxx Xxxxxx
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Xxxxxx Xxxxxxx, Xxxxx Xxxxxx
President
ADDENDUM A
EMPLOYMENT TERM SHEET
Xxxxx Xxxxxx
This agreement between Xxxxx Xxxxxx (Xxxxxx), and Finet Holdings Corporation
(Finet) shall define prospective terms of employment.
TERM - The term of this agreement shall be one year.
POSITION - Xxxxxx shall be named the companies Vice President of Research and
Development.
COMPENSATION- Xxxxxx shall receive a base salary of $125,000 per year effective
December 1, 1999. Xxxxxx shall also be provided a $25,000 cash bonus, payable
as; $5, 000 upon signing of this agreement and $20,000 upon completion of
Finet's upcoming equity financing, but no later than December 23, 1999.
EQUITY INCENTIVES - Xxxxxx shall receive 34,722 shares of stock and 75,000
employee qualified incentive stock options. Options shall be priced at 0.75
cents and be vested equally over 36 months. In the event the Company's Common
Stock is trading below 0.75 on the date 12 months from the date of this
agreement, FiNet will issue to Xxxxxx that amount of shares of Common Stock
sufficient to equal the original $25,000.
BENEFITS - Xxxxxx shall receive standard benefits as provided to other Finet
Holdings Vice Presidents; including, medical, dental, life and paid vacation.
Agreed by:
/s/ Xxxxx Xxxxxx /s/ Xxxxxx Xxxxxxx
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Xxxxx Xxxxxx Xxxxxx Xxxxxxx, President
Dated: December 15, 1999 Dated: December 15, 1999
