EXHIBIT 10.10
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is entered into as of the 31st
day of July, 1998, by and between Meta4 Digital Design, Inc., a Washington
corporation f/k/a TFAB Acquisition Corp. (the "Company"), and Xxxxxxx Xxxxxx
("Employee") and sets forth the terms of the employment relationship between the
Company and Employee.
1. AGREEMENT CONDITIONED ON ACQUISITION. This Agreement is executed in
connection with the pending acquisition (the "Merger") pursuant to which Meta4
Digital Design, Inc., a Delaware corporation ("Meta4"), will be merged with and
into TFAB Acquisition Corp., a Washington corporation and a wholly-owned
subsidiary of xxxx.xxx International Corp. ("xxxx.xxx"). Upon the effective
date of the Merger, TFAB Acquisition Corp., which shall be the surviving
corporation in the Merger, shall change its name to Meta4 Digital Design, Inc.
This Agreement shall become effective only upon consummation of the Merger.
2. TERM OF AGREEMENT. The Company hereby employs Employee to perform the
duties described herein, and Employee accepts employment with the Company, for a
term beginning on the date hereof and continuing for a period of three (3) years
(the "Term"). The Term of this Agreement shall terminate upon the expiration of
the Term unless extended or renewed by written agreement of the parties. In
addition to any termination in the event of a decision of non-renewal, this
Agreement may be terminated prior to the end of the Term in the manner provided
for in Section 10 below.
3. POSITION AND DUTIES. The Company and Employee agree that Employee will
be employed as Vice President of Business Development and shall be directly
accountable to the President and the Board of Directors of the Company for the
performance of all responsibilities related to sales to new prospects and
existing customers. In this capacity, Employee's responsibilities will include,
but are not limited to setting up and maintaining reports and processes in
cooperation with the Vice President P of Business Development on sales and
activities and shall have overall responsibility for executing and coordinating
sales strategies in accordance with corporate strategies, plans, programs and
functions within the region. Employee shall works with the various business
development personnel to establish leads within the Company's targeted customer
base, to continuously improve the sales process, champion the client within the
Company and help lead the client with online strategies.
It is understood that from time to time Employee may be assigned other
duties or titles in addition to or in lieu of those described above and that
Employee's responsibilities may be modified at any time in the reasonable
discretion of the Company in order to accommodate the needs of the Company.
3.1 Employee acknowledges and agrees that an initial essential aspect
of his employment with the Company shall be to use his best efforts in assisting
in and managing the transition of clients and services from Meta4 to the Company
due to the Merger, including, without limitation, being responsible for the
continued good relationships with the existing customers of Meta4 and
maintaining substantially the same revenue base, and that this Agreement is
being entered into, in part, in reliance upon such understanding.
3.2 Employee agrees to devote his full-time efforts to his duties
with the Company and further agrees that Employee will not directly or
indirectly engage or participate in any activities while employed with the
Company that would conflict with the best interests of the Company or xxxx.xxx.
4. COMPENSATION.
4.1 SALARY AND BONUS. For services rendered by Employee under this
Agreement, the Company shall pay Employee an annual salary of $125,000 for each
year of the Term, unless terminated prior to the expiration of the Term. The
gross salary of $125,000 shall include any and all amounts incurred by the
Company for automobile lease expenses for Employee and any such amounts paid by
the Company for Employee's automobile lease payments shall be deducted from
Employee's monthly paychecks. Employee shall be paid this salary in equal
periodic installments consistent with the Company's normal payroll procedures,
minus all lawful and agreed upon payroll deductions. Employee shall also be
eligible for annual performance bonuses, as determined in the sole and absolute
discretion of Company's Board of Directors.
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4.2 ELIGIBILITY FOR STOCK OPTION GRANTS. Employee shall also be eligible,
from time to time as determined by Company's Board of Directors, to receive
grants of stock options to purchase shares of xxxx.xxx Common Stock, pursuant to
the Company's stock option plan. The exercise price, vesting schedule and other
terms and provisions of any such stock option grant shall be as determined by
the Board of Directors and consistent with the terms and provisions of the
Company's stock option plan for employees. The terms of the vesting schedule on
any option granted to Employee by Company shall in no way imply or be construed
as an extension or modification of the term of employment under this Agreement.
5. EXPENSE REIMBURSEMENTS. The Company agrees to reimburse Employee for
all reasonable business expenses incurred by Employee while on the Company's
business, in accordance with the Company's polices as may be in effect from time
to time. Employee shall maintain such records as will be necessary to enable the
Company to properly deduct such items as business expenses when computing the
Company's federal income tax.
6. OTHER AGREEMENTS.
6.1 PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT. Concurrent
with the execution of this Agreement, Employee also executes and hereby delivers
a Proprietary Information and Inventions Agreement, substantially in the form
attached hereto as Exhibit A.
6.2 COVENANT NOT TO COMPETE. Employee agrees that Company and
xxxx.xxx has many substantial, legitimate business interests that can be
protected only by Employee agreeing not to compete with the Company or xxxx.xxx
under certain circumstances. These interests include, without limitation, the
Company's and xxxx.xxx's contacts and relationship's with its customers, the
Company's and xxxx.xxx's reputation and goodwill in the industry, rights in
confidential information and the investment by xxxx.xxx in the Merger involving
Meta4. In light of the foregoing as well as due to the unique value to the
Company of Employee's services, Employee agrees that during his employment with
the Company, and for a period of three (3) years months after termination of his
employment (regardless of the reason such employment ends), Employee will not,
directly or indirectly: (a) serve or act as principal, owner, employee, or
agent, or otherwise engage in any business that either (i) involves Internet,
Intranet or Extranet based products and services using relational database
techniques and database compilation techniques or (ii) competes with the
business of xxxx.xxx, the Company or any of their subsidiaries, as such business
may have existed or may have been planned at any time during Employee's
employment with the Company; (b) solicit for employment or employ any employee
of xxxx.xxx, the Company or any of their subsidiaries; and (c) solicit business
from clients of xxxx.xxx, the Company or any of their subsidiaries.
Employee acknowledges and agrees that this non-competition agreement is
being entered into in connection with and as an express condition to the Merger
between the Company and Meta4. Any dispute regarding the enforceability of this
non-competition agreement shall be evaluated under the legal standards
applicable to a non-competition agreement given in connection with the sale of a
business (it being understood that in no event shall the non-competition period
extend beyond three years after Employee's employment ends). Employee
acknowledges and agrees that in addition to the foregoing agreement, he shall
continue to be subject to his obligations to the Company, including, without
limitation, obligations arising under the Proprietary Information and Inventions
Agreement referred to in Section 6.1 above.
7. FRINGE BENEFITS. The Company and Employee agree that during the term
of this Agreement, Employee shall be entitled to participate in all fringe
benefits and incentive compensation plans as may be authorized and adopted from
time to time by the Company for the benefit of employees generally and for which
Employee is eligible.
8. VACATION. Employee shall be entitled to 10 days paid vacation per
calendar year. Such time shall be accounted for pursuant and subject to the
Company's vacation policies of general applicability.
9. CONFIDENTIAL INFORMATION. It is understood and agreed that as a
result of Employee's employment hereunder, Employee will be acquiring and making
use of confidential information about xxxx.xxx and the Company and their
businesses, including, without limitation, financial information and information
about their customers. Employee agrees that he will respect the confidences of
xxxx.xxx and the Company and will not at any time during or within one (1) year
following the termination of his employment hereunder, directly or indirectly,
divulge or disclose for any purpose whatsoever or use for his own benefit, any
confidential information that has been obtained
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by or disclosed to Employee as a result of his employment hereunder.
"Confidential information" as used herein does not include information that is
in the public domain and information received by Employee from third parties who
have the right to disseminate the information. The covenant of this Section 9 is
in addition to and in no way qualifies or limits the terms of Proprietary
Information and Inventions Agreement referred to in Section 6.1 above.
10. TERMINATION; RIGHTS ON TERMINATION. Employee's employment may be
terminated in any one of the following ways, prior to the expiration of the
Term; provided, however, that as described in Section 11 below, certain
provisions of this Agreement shall survive termination and shall continue in
full force and effect according to their terms:
(a) Death. The death of Employee shall immediately terminate the
Term, and no severance compensation shall be owed to Employee's estate.
(b) Disability. If, as a result of incapacity due to physical or
mental illness or injury, Employee shall have been unable to perform the
material duties of his position on a full-time basis for a period of three (3)
consecutive months, or for a total of three (3) months in any six (6) month
period, then thirty (30) days after written notice to the Employee (which notice
may be given before or after the end of the aforementioned periods, but which
shall not be effective earlier than the last day of the applicable period), the
Company may terminate Employee's employment hereunder if Employee is unable to
resume his full-time duties at the conclusion of such notice period. If
Employee's employment is terminated as a result of Employee's disability, the
Company shall continue to pay Employee his base salary at the then-current rate
for the lesser of (i) three (3) months from the effective date of termination,
or (ii) whatever time period is remaining under the then-current period of the
Term. Such payments shall be made in accordance with the Company's regular
payroll cycle.
(c) Termination by the Company "For Cause." The Company may
terminate the Term promptly after written notice to Employee "for cause," which
shall be: (i) Employee's material breach of this Agreement, which breach is not
cured within ten (10) days of receipt by Employee of written notice from the
Company specifying the breach; (ii) Employee's gross negligence in the
performance of his duties hereunder, intentional nonperformance or
misperformance of such duties, or refusal to abide by or comply with the
directives of the Board of Directors, his superior officers, or xxxx.xxx's or
the Company's policies and procedures, which actions continue for a period of at
least ten (10) days after receipt by Employee of written notice of the need to
cure or cease; (iii) Employee's willful dishonesty, fraud, or misconduct with
respect to the business or affairs of the Company or xxxx.xxx, and that in the
judgment of the Company or xxxx.xxx materially and adversely affects the
operations or reputation of the Company or xxxx.xxx; (iv) Employee's conviction
of a felony or other crime involving moral turpitude; or (v) Employee's abuse of
alcohol or drugs (legal or illegal) that, in the Company's judgment, materially
impairs the Employee's ability to perform his duties hereunder. In the event of
termination "for cause," as enumerated above, Employee shall have no right to
any severance compensation.
11. Effect of Termination. Upon termination of Employee's employment, the
Company agrees to pay Employee all salary or other remuneration which is due and
owing to Employee as of the date of termination, less legal deductions or
offsets Employee may owe to the Company for such items as salary advances or
loans. Employee agrees that his signature on this Agreement constitutes his
authorization for all such deductions. Employee agrees to promptly return all
of the Company's property of any kind which may be in Employee's possession. In
the event of termination Employee's employment under this Agreement, the terms
and provisions of this Agreement shall also terminate, with the exception of the
confidentiality provision contained in Section 9 and the provisions of the non-
competition agreement of Section 6.2 and the Proprietary Information and
Inventions Agreement referred to in Section 6.1 above. Such provisions shall
continue in full force and effect according to their terms.
12. CONSTRUCTION OF AGREEMENT.
12.1 ESSENTIAL TERMS AND MODIFICATION OF AGREEMENT. It is understood
and agreed that the terms and conditions described in this Agreement and the
agreements expressly referenced herein constitute the essential terms and
conditions of the employment arrangement between the Company and Employee, all
of which have been voluntarily agreed upon. The Company and Employee agree that
there are no other essential terms or conditions of the employment relationship
that are not described or referenced within this Agreement, and that any change
in the essential terms and conditions of this Agreement or any such referenced
agreement will be written down in a supplemental agreement which shall be signed
by both the Company and Employee before it is effective.
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12.2 SEVERABILITY. If any term, covenant, condition or provision of
this Agreement or the application thereof to any person or circumstance shall,
at any time, or to any extent, be determined invalid or unenforceable, the
remaining provisions hereof shall not be affected thereby and shall be deemed
valid and fully enforceable to the extent permitted by law.
12.3 NOTICES. Any notice hereunder shall be sufficient if in writing
and delivered to the party or sent by certified mail, return receipt requested
and addressed as follows:
(a) If to Company: Meta4 Digital Design, Inc.
c/o xxxx.xxx International Corp.
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attn: Trevor X.X. Xxxxxxx, Esq.
(b) If to Employee: Xxxxxxx Xxxxxx
000-00 Xxxxxxxxxx Xxxxx
Xxxxxx Xxxx, XX 00000
Either party may change the address herein specified by giving written notice of
such change.
12.4 GOVERNING LAW. This Agreement is made and shall be construed
and performed under the laws of the State of Washington.
12.5 WAIVER OF AGREEMENT. The waiver by the Company of a breach of
any provision of this Agreement by Employee shall not operate or be construed as
a waiver by the Company of any subsequent breach by Employee.
12.6 CAPTIONS. Captions and headings of the Sections herein are for
convenience and reference only and are not to be used to interpret or define
provisions hereof.
12.7 ASSIGNMENT AND SUCCESSORS. The rights and obligations of the
Company under this Agreement shall inure to the benefit of and be binding upon
the successors and assigns of the Company. The rights and obligations of
Employee hereunder are nonassignable. The Company may assign its rights and
obligations to xxxx.xxx or to any entity in which the Company or any company
affiliated with the Company, has a majority ownership interest.
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DATED as of the date first above written.
EMPLOYEE:
/s/ Xxxxxxx Xxxxxx
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Xxxxxxx Xxxxxx
COMPANY:
META4 DIGITAL DESIGN, INC.,
a Washington corporation
By: /s/ Xxxxx X. Xxxxxxxxxx
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Its: Xxxxx X. Xxxxxxxxxx, President
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Signature Page to Employment Agreement
