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EXHIBIT 10.3
EMPLOYMENT AGREEMENT
Between
XXXX.XXX CORPORATION
And
XXXXXX X. FINE
This Agreement confirms the terms of the employment relationship
between xxxx.xxx Corporation and its successors and assigns ("Employer"), and
Xxxxxx X. Fine ("Employee"). Employee's employment by Employer began in October
1994. In light of recent changes in Employer's business, Employee and Employer
desire to set forth Employee's terms of employment in writing. For good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
1. TERM OF AGREEMENT. Employee shall be employed by Employer for a
term of three years commencing on the first day of the month following the
closing of the initial public offering underwritten by Xxxxxxx and Company
Securities, Inc., as Representative of the Underwriters, unless employment is
sooner terminated as provided herein. This Agreement thereafter shall be
automatically renewed for succeeding terms of one (1) year, unless at least
ninety (90) days prior to the expiration of any term, either party gives written
notice, pursuant to Section 11.3 of this Agreement, to the other of that party's
intention not to renew this Agreement.
2. POSITION AND DUTIES. Employee will be employed as President and
Chief Executive Officer and in this capacity, Employee's responsibilities will
include, but are not limited to, those duties that may be described in the
Bylaws of Employer or may be defined by the Board of Directors of Employer.
2.1 From time to time, Employee may be assigned other duties in
addition to those described above, and Employee's responsibilities may be
modified or expanded at any time by Employer in order to accommodate the needs
of Employer. As President and Chief Executive Officer of Employer, the hours
which Employee is required to work will vary considerably and will sometimes be
more than forty (40) hours per week. Employee understands that such work in
excess of forty (40) hours per week is a regular and normal part of Employee's
responsibilities for which he is compensated, and does not in any way constitute
overtime for which Employee is entitled to receive additional compensation.
2.2 Employee will have the authority to hire and fire other
employees of the company under his supervision.
2.3 In addition to his employment responsibilities, Employee will
serve on the Employer's Board of Directors, if elected, and will assume whatever
corporate office said Board of Directors may designate.
2.4 Employee shall devote his full-time efforts to his duties with
Employer and Employee shall not directly or indirectly engage or participate in
any activities while employed with Employer that would conflict with the best
interests of Employer.
2.5 Employee's obligation to devote his full-time attention and
energy to the business of Employer shall not be construed as preventing Employee
from investing his assets so long as any such investment will not require any
services on the part of Employee in the operation of the affairs of the
company(ies) or business(es) in which such investment(s) is (are) made.
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3. EMPLOYER'S COVENANTS
3.1 Employer shall furnish Employee with such equipment, employees
and services as are necessary to perform Employee's obligations under this
Agreement. Such equipment shall include, at a minimum, one desktop computer
together with all appropriate software programs, one laptop portable computer
with complete remote communications capability, and one cellular telephone.
Employer shall also pay for Employee's membership dues in professional
organizations, the reasonable costs of any seminar attendance or continuing
education requirements of Employee's profession and Employee's subscriptions to
a reasonable number of professional journals.
3.2 Employer shall reimburse Employee for all reasonable business
expenses incurred by Employee while on Employer's business. Employee shall
maintain such records as will be necessary to enable Employer to properly deduct
such items as business expenses when computing Employer's federal income tax.
4. COMPENSATION
4.1 For all services rendered by Employee under this Agreement,
including services, if any, rendered in the capacity as a director of the
Company, Employer will pay Employee a base salary of Ninety Five Thousand
Dollars ($95,000) per year (the "Base Salary"). Employee will be paid this
salary on a semi-monthly basis, minus all lawful and agreed upon payroll
deductions.
4.2 During the term of this Agreement, Employer's Board of Directors
may authorize additional compensation by way of increases to the Base Salary,
bonus, or otherwise as deemed appropriate. During the term of this Agreement,
Employer's Board of Directors shall periodically review, on a basis not more
frequently than annually, Employee's Base Salary in light of Employee's
performance and the overall performance of Employer for purposes of considering
increases to Employee's annual salary.
4.3 Because Employer's earnings depend largely upon the performance
and productivity of Employee, Employer's Board of Directors shall annually
review the services rendered by the Employee and, at the sole discretion of the
Board of Directors, may award a bonus in an amount which will recognize
Employee's contributions to profits during that period.
5. FRINGE BENEFITS
5.1 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 Employer and for which Employee
is eligible, including without limitation any and all stock option, stock bonus,
pension, profit sharing, disability, medical, group life insurance, or other
employee benefit plans.
5.2 Employee shall be entitled to a reasonable number of paid sick
leave days during each calendar year of employment. In determining what is a
reasonable number of days, Employer shall take into consideration previous
periods of disability, the number of days of sick leave taken in the current
year and preceding years, and other factors it deems pertinent. Employer shall
be the sole party to determine the reasonableness of Employee's number of sick
leave days.
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5.3 Employee shall be entitled to four (4) weeks' paid vacation per
calendar year.
5.4 Employer shall provide Employee a monthly automobile allowance
of Four Hundred Fifty Dollars ($450). Employer shall provide Employee with a
parking space at Employer's expense.
5.5 During the term of this Agreement, Employer and Employee shall
arrange for a mutually acceptable term life insurance policy for Employee,
payable to Employee's estate, in the amount of One Million Dollars ($1,000,000);
and Employer shall pay up to 50% of the premium amount of such life insurance
policy provided that such amount does not exceed $1,000.00 annually.
6. CONFIDENTIAL INFORMATION. As a result of Employee's employment with
Employer, Employee will be acquiring and making use of confidential information
about Employer's business, including without limitation ideas, products,
financial and marketing information about Employer. Employee, for a period of
eighteen (18) months after the termination of this Agreement, will not at any
time, without the express prior written consent of Employer, disclose or
otherwise make known or available to any person, firm, corporation or other
entity other than Employer, or use for his own account, any information
identified by Employer as "confidential."
7. COVENANT NOT TO COMPETE. In view of the unique value to Employer of
Employee's services, during his employment with Employer, and for a period of
twenty four (24) months after termination of his employment, Employee will not
directly or indirectly: (a) as principal, owner, employee, or agent, engage in
any business involving Internet, Intranet or Extranet based products and
services using relational database techniques and database compilation
techniques for companies located in the United States; (b) solicit for
employment or employ any employee of Employer; and (c) solicit business from
clients of Employer.
8. SPECIFIC PERFORMANCE. Employee acknowledges that (a) the covenants
set forth in Sections 6 and 7 are essential elements of the transactions
contemplated in this Agreement, that, but for the agreement of Employee to
comply with such covenants, Employer would not have entered into this Agreement,
and that Employee has consulted with, or has had the opportunity to consult
with, counsel and has been advised in all respects concerning the reasonableness
of such covenants as to scope and limit of time; (b) Employer will not have any
adequate remedy at law if Employee violates the terms of Sections 6 and 7 or
fails to perform any of his other obligations hereunder; and (c) Employer shall
have the right, in addition to any other rights it may have, to obtain in any
court of competent jurisdiction temporary, preliminary and permanent injunctive
relief to restrain any breach, threatened breach, or otherwise to specifically
enforce any, of such covenants or any other obligations of Employee if Employee
fails to perform any of his obligations under this Agreement.
9. TERMINATION. This Agreement will be terminated upon the occurrence
of any one of the following events:
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9.1 By either party to this Agreement, without cause, upon not less
than ninety days prior written notice, if the date of such notice is within
ninety days of the anniversary of the commencement of the term of this
Agreement, provided however that no such notice shall be effective for any
period prior to the third anniversary of the commencement of the term of this
Agreement.
9.2 Death of Employee.
9.3 For cause, where "cause" is defined as a willful dereliction of
duty or conviction of a felony.
10. EFFECT OF TERMINATION. Upon termination of Employee's employment,
Employer will pay Employee all salary, fringe benefits, bonuses and all other
remuneration which are due and owing to Employee as of the date of termination,
less legal deductions or offsets Employee may owe to Employer for such items as
salary advances or loans. Employee's signature on this Agreement constitutes his
authorization for all such deductions. Employee agrees to return to Employer all
of Employer's property of any kind which may be in Employee's possession. In the
event this Agreement is terminated, the terms and provisions of this Agreement
will also terminate, except for Sections 6, 7 and 8 of this Agreement, which
will survive termination of this Agreement.
11. MISCELLANEOUS
11.1 The terms and conditions described in this Agreement
constitute the essential terms and conditions of the employment arrangement
between Employer and Employee, all of which have been voluntarily agreed upon.
There are no other essential terms or conditions of the employment relationship
that are not described within this Agreement, and any change in the essential
terms and conditions of this Agreement must be in writing, signed by both
Employer and Employee to be effective.
11.2 The invalidity of all or any part of any section of this
Agreement shall not render invalid the remainder of this Agreement or the
remainder of such section. If any provision of this Agreement is so broad as to
be unenforceable, such provision shall be interpreted to be only so broad as is
enforceable. Employee and Employer acknowledge and stipulate that the covenants
set forth in Sections 6, 7, and 8 of this Agreement are fair and reasonably
necessary for the protection of Employer's protectable interests. In the event a
court of competent jurisdiction should decline to enforce any provision of
Sections 6, 7, and 8 as written herein, such provision shall be deemed to be
modified to the minimum extent necessary to render such provision enforceable.
11.3 Any notice given pursuant to this Agreement will be sufficient
if it is in writing and personally delivered to the party or sent by certified
mail, return receipt requested, addressed to the party at the addresses set
forth below each party's signature. Either party may change his or its address
by giving to the other written notice of such change as provided in this
paragraph.
11.4 This Agreement is made and will be construed and performed
under the laws of the State of Washington. In the event either party is required
to institute legal action to enforce the provisions of this Agreement, venue
shall be in King County, Washington. In any such legal action, the substantially
prevailing party in such litigation will be entitled to recover reasonable
attorneys' and experts' fees and expenses.
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11.5 The waiver by Employer of a breach of any provision of this
Agreement by Employee will not operate or be construed as a waiver by Employer
of any subsequent breach by Employee.
11.6 The captions and headings of the paragraphs of this Agreement
are for convenience and reference only and are not to be used to interpret or
define the provisions hereof.
11.7 The rights and obligations of Employer under this Agreement
will inure to the benefit of and be binding upon the successors and assigns of
Employer. The rights and obligations of Employee hereunder are nonassignable.
Employer may assign its rights and obligations to any entity without the consent
of Employee.
DATED May 9, 1997.
EMPLOYEE: xxxx.xxx CORPORATION:
/s/ Xxxxxx X. Fine /s/ Xxxxx X. Xxxxxxxxxx
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Xxxxxx X. Fine By: Xxxxx X. Xxxxxxxxxx, CFO
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