XXXXX X. XXXXX
Amended Employment Agreement
AGREEMENT by and between Multimedia Access Corporation, a Delaware
corporation (herein called the "Company"), and Xxxxx X. Xxxxx (herein called the
"Employee").
WITNESSETH:
For and in consideration of the mutual promises and covenants herein
contained, the parties hereto mutually agree as follows:
Section 1. Employment. The Company hereby employs the Employee as Chief
Executive Officer of the Company for the term and upon the terms and conditions
hereinafter set forth, and the Employee hereby accepts such employment.
Section 2. Term. The Employee's employment hereunder shall be for a term of five
(5) years commencing February 7, 1994, and continuing through and including
February 6, 1999, renewable automatically from year to year thereafter unless
either party provides the other with written notice of non-renewal at least 90
days prior to the expiration of the initial term or of any renewal term.
Section 3. Duties; Control and Direction by Board of Directors.
Section 3(a). Duties. The Employee agrees to serve as Chief Executive
Officer. As such, the Employee (i) shall assist the Company in the development
of all phases of the Company's business and (ii) shall have such other or
further duties, powers, and responsibilities as from time to time may be
assigned to him by the Board of Directors of the Company.
Section 3(b). Rules and Regulations. The Employee shall comply with all
Company rules and regulations applicable to the executive employees of the
Company or to its employees generally and with all Company policies established
by the Board of Directors.
Section 4. Extent of Services. During the term of this Agreement, the Employee
shall devote his best efforts to the business of the Company and the furthering
of its interests and to the discharge of his duties, functions and
responsibilities hereunder.
Section 5. Compensation. As compensation during the term of the Employee's
employment hereunder, the Company shall pay to the Employee, and the Employee
shall accept, a salary at the rate of $135,000 per annum, or at such higher rate
as the Board of Direc-
tors, after periodic review, at its option and in its sole discretion, may fix.
The Employee will also receive an annual bonus based on performance. Such bonus
will be determined annually by the Board of Directors.
Section 6. Fringe Benefits. The Employee shall have the right to participate, on
the same terms and subject to the same conditions, limitations, restrictions and
requirements as the other executive employees of the Company in such medical,
health, insurance, pension, profit sharing, stock option and other plans, if
any, as the Company may from time to time provide for the benefit of its
employees and in which executive employees of the Company are eligible to
participate. The Company shall provide the Employee with an automobile allowance
of $850.00 per month.
Section 7. Expenses. The Employee is authorized to incur reasonable expenses in
performing services for and in promoting the business of the Company, including
expenses for business entertainment and travel. The Company shall promptly
reimburse the Employee for such expenses provided that the Employee presents an
itemized statement of the same together with such supporting vouchers as the
Company may from time to time require and are normally available.
Section 8. Patents, Copyrights, etc.
Section 8(a). Patents, Copyrights, etc. The Employee agrees that any
and all "Proprietary Property" (as defined in Section 8(b) following) that is
created, developed or discovered by or for the Company, or acquired by the
Company from others, and that comes into the Employee's knowledge or possession
during and in the course of the Employee's employment hereunder, shall be
received by the Employee as an employee of the Company and not in any way for
his own benefit, and that the Employee shall have no rights and shall acquire no
rights therein unless and until the Company shall expressly and in writing waive
the rights that it has therein and thereto under the provisions of this
sentence. The Employee further agrees (a) that any and all Proprietary Property
that is invented, created, written, developed, furnished or produced by the
Employee during the term of the Employee's employment under this Agreement shall
be the exclusive property of the Company, and that the Employee shall have no
right, title or interest of any kind therein or thereto or in and to any results
or proceeds therefrom, and (b) that at any time, during the term of this
Agreement, the Employee will (1) upon the request and at the expense of the
Company, (i) obtain patents or copyrights on, or (ii) permit the Company to
patent or copyright, any such material, whichever (i) or (ii) is appropriate,
and/or (2) at the request of the Company, execute any and all assignments,
instruments of transfer, or other documents, that the Company deems necessary or
appropriate to transfer to the Company all rights in or to such materials or to
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evidence the Company's ownership of such rights or any of them. The Employee
shall not, without limitation as to time or place, use any Proprietary Property
except on Company business during his period of employment or disclose same to
any other person, firm or corporation, except for disclosure on Company
business.
Section 8(b). "Proprietary Property." As used in this Agreement,
"Proprietary Property" means any and all ideas, creations, inventions,
improvements, know-how, methods of applying and putting into practice any
inventions or know-how and proprietary technical information which are not
generally known in the videoconferencing industry and which are disclosed to or
known or developed by Employee as a consequence of or through his employment.
Section 9. Insurance. The Employee agrees to submit to the usual and customary
medical examinations and otherwise cooperate with the Company in its procurement
of such insurance policies on the Employee's life as the Company may desire. If
at any time in the Employee's lifetime the Employee ceases to be employed by the
Company, then the Company shall promptly, if requested by the Employee and
subject to the applicable regulations of the insurance company or companies
concerned, transfer, assign and deliver to the Employee, any and all insurance
policies on the life of the Employee then held and/or owned by the Company.
Premiums shall be adjusted to the date of such transfer, assignment and
delivery.
Section 10. Participation in Competing Business. The Employee shall not at any
time during the term of his employment own a majority or controlling interest in
or be connected with majority ownership, management, operation, or control of
any business that engages in a business which deals in services or products
similar to and competitive with the Company's services or products in the United
States or any other geographic region where the Company is engaged in business,
but the above shall not be deemed to exclude Employee from acting as a director
of or a consultant to other corporations or entities with the consent of the
Company's Board of Directors.
Section 11. Non-Competition.
The Company's Board of Directors may require that the Employee not
compete with the Company or solicit any of the Company's clients on behalf of
himself or an entity founded by the Employee within two years after leaving the
Company. The Employee further agrees that the Company's Board of Directors may
require that the Employee not compete with the Company or solicit any of the
Company's clients as an employee of a company that engages in a business which
deals in services or products and competitive with the Company's services or
products within two years after leaving the Company.
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In consideration for the above agreement, the Company's Board of
Directors agrees that the Employee shall continue to receive a salary at the
level of compensation received by Employee at the time employment ends, as
provided by Section 5 of this Employment Agreement, for the entire period the
Non-Competition clause is in effect.
Section 12. Termination of the Agreement and of the Employee's Employment
Hereunder.
Section 12(a). Termination for Cause by the Company. The Company shall
have the right to terminate this Agreement and Employee's employment hereunder
at any time for cause (as defined in Section 19 hereunder) upon 30 days' written
notice of such termination specifying the reasons therefor. Employee shall have
30 days following receipt of such written notice to cure the cause to the
satisfaction of the Board of Directors. In the event Employee does not cure such
cause in the good faith determination of the Board, Employee's employment
hereunder shall cease. In the event of such termination for cause, Employee
shall be entitled to receive accrued pay and benefits as of the date of
termination.
Section 12(b). Termination Without Cause by the Company or for Good
Reason by the Employee. In the event that:
(1) the Company terminates this Agreement and the Employee's employment
hereunder without cause, that is, for any reason other than "cause" (as defined
in Section 19 hereof), death or incapaci- ty; or
(2) the Employee terminates this Agreement and his employment hereunder
for "Good Reason" (as defined in Section 19 hereof); then, in either such case:
The Employee shall receive from the Company prior to the effective time
of such termination: (i) all Employee's accrued salary, bonuses and benefits
through the date of such termination, (ii) the acceleration as to vesting of
those certain options, assumed by the Company pursuant to the terms of the
Agreement and Plan of Merger and Reorganization between Viewpoint Systems, Inc.
and the Company, to purchase securities of the Company granted or issued to
Employee (and, in the event of a change in control, the assumption by the
acquiror of all such outstanding options) and the right to exercise such options
within 90 days following the effective time of such termination; (iii) a sum
equal in the aggregate to the full amount, discounted by three percent (3%), of
(a) the salary and benefits which the Employee would have received, at the
average rate or rates in effect during the six-month period immediately prior to
termination, and (b) the annual bonus or
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bonuses which the Employee would have received, at the rate of the Employee's
annual bonus for the last full fiscal year of the Company ending prior to
termination, had, with respect to both (a) and (b), the Employee's employment
under this Agreement continued for the full initial five-year term or renewal
term thereof, as the case may be, as provided in Section 2 hereof, and (iv)
immediate payment of all notes, convertible debt, and/or short-term debt owed by
the Company to the Employee (the "Notes"), whether or not such Notes are due and
payable at the time of termination. The Employee shall not be required to
mitigate the amount of any payments provided for in this Section 12(b) by
seeking other employment or otherwise, and any such employment, if obtained,
shall not be deemed to mitigate such amount. In addition, upon termination of
the agreement the Employee's obligations under his "lock-up" agreement with the
Company shall terminate.
Section 12(c). Voluntary Termination without Good Reason. In the event
Employee terminates this agreement and his employment hereunder without Good
Reason, Employee shall be entitled to receive accrued pay and benefits including
benefits set forth in Section 12(b)(iv) as of the date of termination.
Section 12. Termination by Reason of Death or Incapacity of the Employee.
(a) This Agreement will terminate upon the Employee's death.
(b) Incapacity:
(i) In the event Employee shall, during the term of employment,
fail substantially to perform his duties hereunder for a
period of six (6) consecutive months because of illness or
other incapacity, he shall, upon the furnishing by a physician
(acceptable to both Company and Employee or his family) of a
written statement that Employee is totally incapacitated or
that it would be unsafe or unwise for serious health reasons
for Employee to perform his duties hereunder, be deemed to be
totally incapacitated. In the event a physician cannot be
located who is acceptable to both parties, each shall select a
physician who shall together select a third, whose decision
shall be final. In the event of a dispute or inability to
select a third, a physician shall be selected by the American
Arbitration Association, and such physician's decision shall
be final.
(ii) If Employee shall be deemed totally incapacitated as set forth
above, the Company, unless this Agreement shall
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have earlier terminated, may at its option, by giving Employee
written notice of its intention to do so, terminate Employee's
employment hereunder effective as of the end of the calendar
month in which such notice is given, and the Company shall pay
Employee prior to the effective time of such termination a sum
equal in the aggregate to an additional twelve (12) months'
salary and benefits which the Employee would have received, at
the average rate or rates in effect for the six-month period
immediately prior to termination, less any amounts the
Employee receives through disability policies maintained by
the Company, provided that, upon such termination, all notes,
convertible debt, and/or short-term debt owed by the Company
to the Employee (the "Notes"), whether or not such Notes are
due and payable at the time of termination, shall be
immediately payable to the Employee; and further provided
that, upon such termination, the Employee's obligations under
his "lockup" agreement with the Company shall terminate.
(iii) In the event Employee shall not have been deemed totally
incapacitated as provided above, but shall have failed as a
result of temporary incapacitation to perform his duties
hereunder for an aggregate of more than twelve (12) months in
any period of twenty-four (24) consecutive months, the Company
may at its option, by giving Employee written notice of its
intention to do so, terminate Employee's employment hereunder
effective as of the end of the calendar month in which such
notice is given, and the Company shall pay Employee prior to
the effective time of such termination a sum equal in the
aggregate to an additional twelve (12) months of salary and
benefits which the Employee would have received, at the
average rate or rates in effect for the six-month period
immediately prior to termination, less any amounts the
Employee receives through disability policies maintained by
the Company, provided that, upon such termination, all notes,
convertible debt, and/or short-term debt owed by the Company
to the Employee (the "Notes"), whether or not such Notes are
due and payable at the time of termination, shall be
immediately payable to the Employee; and further provided
that, upon such termination, the Employee's obligations under
his "lock- up" agreement with the Company shall terminate.
Section 14. Registration Rights.
Section 14(a). Piggyback Rights. In the event that the Company shall
at any time undertake to file a registration statement with the Securities and
Exchange Commission to register
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securities of the Company for sale to the public (other than a registration
statement relating solely to an employee benefit plan or a Rule 145
transaction), either for the Company's account or for the account of others,
then the Company shall provide to the Employee written notice of such intended
registration and the anticipated terms thereof. The Employee shall be entitled
to include in such registration all or any portion of the shares of Common Stock
of the Company then held by the Employee (including shares of Common Stock
issuable upon exercise of options or warrants or conversion of convertible
securities). The Company shall bear any and all costs of the preparation and
filing of the Registration Statement and the making of the offering, including
without limitation all fees of the Company's independent auditors and
accountants and the fees of one counsel to all selling shareholders, provided
only that the Employee shall be responsible for underwriting discounts and
commissions associated with the shares sold by the Employee. In the event that
the registration statement relates to an underwritten public offering, the
Employee's right to include shares in the registration and offering will be
contingent upon the Employee entering into an underwriting agreement with the
underwriters of the offering providing for reciprocal indemnification and
contribution and other customary terms appearing in underwriting agreements
issued by investment bankers. In the event that the managing underwriters of a
firm commitment underwritten offering advise the Company that marketing factors
limit the aggregate number of shares that may be included in the registration
and offering on behalf of selling stockholders, then the managing underwriters
may limit the shares included in the registration and offering on the part of
the Employee and other selling stockholders, provided that the Employee shall be
entitled to sell a pro rata portion of the aggregate number of shares which are
included on behalf of the selling stockholders, based upon the number of shares
entitled to registration rights held by all selling stockholders proposing to
include shares in the offering.
Section 14(b). Demand Rights. At the written request of the Employee
made at any time prior to termination of this Agreement or within one year
thereafter, the Company agrees promptly to prepare and file a registration
statement with the Securities and Exchange Commission to register under the
Securities Act of 1933 for sale by the Employee of any or all shares of the
Company's Common Stock, $.0001 par value per share, held by the Employee, or
issuable to the Employee upon the exercise of stock options held by the
Employee, to use its best efforts to have such registration statement declared
effective as promptly as practicable and to maintain such registration statement
in effect for not less than two years from its effective date. The Company shall
bear any and all costs of the sale of the securities pursuant to the
registration statement, except for fees payable to broker/dealers or to counsel
for the Employee which will be borne by the Employee.
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Prior to the effective date of the registration statement, the Company and the
Employee will enter into an agreement providing for reciprocal indemnification
and contribution substantially in the form customarily appearing in underwriting
agreements issued by investment bankers.
Section 14(c). Company's Registration Obligations. With regards to the
registration rights granted to the Employee under Sections 14(a) and 14(b) the
Company will use its best efforts to register or qualify the securities under
the securities laws or blue sky laws of such jurisdictions as the Employee
reasonably requires. The Company will also enter into such other agreements
(including an underwriting agreement) as are customary and take such other
actions as are reasonably required in order to expedite and facilitate the sale
of the securities. The registration rights set forth in this section may be
transferred to any transferee who acquires securities from the Employee;
provided, however, that the Company is given written notice by the Employee at
the time of such transfer stating the name and address of the transferee and
identifying the securities with respect to which the rights are being assigned,
and provided further, however, that registration rights may not be transferred
to any person in connection with the acquisition of shares in a transaction that
was registered under the Securities Act.
Section 15. Effect of Termination. Except as otherwise expressly provided for in
this Agreement, the termination of this Agreement and of the Employee's
employment hereunder shall not affect (a) the Company's obligations to pay the
Employee any salary, benefits and bonus payments accrued to the date of such
termination and unpaid, which obligations shall continue to bind the Company,
(b) the Employee's rights under Sections 12, 13 and 14 of this Agreement or
under the written terms of any stock option or other benefit plan of the
Company, or (c) any right to damages or other remedies that either party may
have (under this Agreement or otherwise) by reason of any acts or omissions of
the other party prior to such termination.
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Section 16. Medical Examination. The Employee shall be required to have a
medical examination annually by a physician acceptable to the Company and at the
Company's cost, the results of which shall be submitted to the Company.
Section 17. Waiver of Breach. Forbearance by either party to require performance
of any provision hereof shall not constitute or be deemed a waiver by such party
of such provision or of the right thereafter to enforce the same, and no waiver
by either party of any breach or default hereunder shall constitute or be deemed
a waiver of any subsequent breach or default, whether of the same or similar
nature or of any other nature, or a waiver of the provision or provisions
breached or with respect to which such default occurred.
Section 18. Notices. All notices and other communications required or permitted
hereunder shall be in writing and may be personally delivered, deposited in the
United States mail (first class postage prepaid, return receipt requested),
transmitted by telecopier or telex, with copy by United States mail (first class
postage prepaid), or sent by a private messenger or overnight courier which
issues delivery receipts, addressed to the party for whom they are intended at
the following addresses:
Address for the Company: Multimedia Access Corporation
0000 Xxxxx Xxxxx, Xxxxx 000
Xxxxxx, XX 00000
Address for the Employee: 0000 Xxxxx Xxxxx, Xxxxx 000
Xxxxxx, XX 00000
Such notices and other communications shall be deemed effective upon receipt,
and in any event be deemed received five days after deposit in the U.S. Mail,
one business day after the business day of transmission by telecopy or telex, or
one business day after the business day of deposit with an overnight courier, as
the case may be. The above addresses may be changed by notice given pursuant to
this Section 18.
Section 19. Definitions. As used in this Agreement:
Person. The term "person" shall mean and include any individual, partnership,
firm, corporation, trust, unincorporated organization, or joint venture.
Cause. The term "cause" for termination by the Company of this Agreement and of
Employee's employment hereunder shall mean such act or omission to act, or
series of acts or omissions to act, or
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E
course of conduct of the Employee that would constitute reckless or criminal
misconduct in the performance of his duties under the Agreement.
Good Reason. The term "Good Reason" for termination by the Employee of this
Agreement and of his employment hereunder shall mean (i) a "change in control"
of the Company (as defined herein) to which the Employee has not given his
express written consent prior to its becoming effective; (ii) a good faith
determination by the Employee that as a result of a "change in control" of the
Company he is unable to discharge effectively his duties and offices under this
Agreement; (iii) removal of the Employee from his position as Chief Executive
Officer of the Company or failure to reelect him to this position or as a
director of the Company; or (iv) a failure by the Company to comply with any
material provision of this Agreement where such noncompliance has not been cured
by the Company within thirty (30) days after the giving of written notice
thereof by the Employee to the Company.
Change in Control. A "change in control" with respect to the Company shall be
deemed to have occurred if (i) substantially all the assets of the Company are
sold, other than any such transaction following which the stockholders of the
Company prior to the transaction retain at least a majority of the voting equity
securities of the surviving or successor corporation; (ii) the Company is merged
or consolidated with, or becomes a subsidiary of, another corporation, other
than any such transaction following which the stockholders of the Company prior
to the transaction retain at least a majority of the voting equity securities of
the surviving or successor corporation; (iii) any "person" or "group" of persons
(as such terms are used in Section 13(d) of the Securities Exchange Act of 1934,
as amended), other than the Company or a subsidiary of the Company, and other
than persons holding greater than 10% of the outstanding voting securities
immediately following the merger of Multimedia Acquisition Corporation and
Viewpoint Systems, Inc., becomes the "beneficial owner" (as defined in Rule
13d-3 under the 1934 Act), directly or indirectly, of securities of the Company
representing 50% or more of the combined voting power of the Company's then
outstanding securities, or (iv) during any period of two consecutive years
during the term of this Agreement, individuals who at the beginning of such
period constitute the Board of Directors of the Company cease for any reason to
constitute at least a majority thereof, unless the election of each director who
was not a director at the beginning of such period has been approved in advance
by directors representing at least two-thirds of the directors then in office
who were directors at the beginning of the period.
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Section 20. Severability. The invalidity or unenforceability of any provision of
this Agreement shall not invalidate or render unenforceable any other provisions
of this Agreement.
Section 21. Binding Effect. The rights and obligations of the Company under this
Agreement shall inure to the benefit of and be binding upon the Company and its
successors and assigns. This Agreement shall be binding upon the Employee and,
except that the Employee may not delegate his obligations hereunder, shall inure
to the benefit of the Employee and the Employee's heirs, executors and
administrators.
Section 22. Governing Law. This Agreement shall be governed by, and construed
under and in accordance with, the laws of the State of Texas.
Section 23. Supersession of Prior Employment Agreement(s). As of the
commencement date of this Agreement (September , 1996), -- this Agreement shall
supersede Employee's employment agreements with the Company executed on May 28,
1996 and any and all other employment agreements Employee may have with the
Company or Viewpoint Systems, Inc. This Agreement, however, shall not divest
Employee of any accrued salary, options or other benefits previously granted and
due Employee under the terms of Employee's employment agreement with the Company
or Viewpoint Systems, Inc.
Section 24. Entire Agreement. This instrument embodies the entire agreement and
understanding by and between the parties hereto with respect to the subject
matter hereof. This Agreement may not be changed, modified or amended in whole
or in part except by a writing signed by both parties. No waiver of any of the
rights hereunder of either of the parties hereto shall be effective or binding
unless such waiver shall be in writing and signed by the party against whom such
waiver is sought to be enforced.
IN WITNESS WHEREOF, the parties have executed this Agreement as of this
1st day of October, 1996.
Multimedia Access Corporation Employee
By: /s/ Xxxxxxx X. Xxxx /s/ Xxxxx X. Xxxxx
---------------------------- ---------------------------
Xxxxxxx X. Xxxx Xxxxx X. Xxxxx
Chairman of the Board
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