EMPLOYMENT AGREEMENT
Exhibit
10.2
EMPLOYMENT
AGREEMENT (this " Agreement
"),
made
and entered into effective as of October 3, 2007 (the " Effective
Date "),
by
and between Xxxxxxx.xxx, Inc. (the " Company
")
and
Xxxx X. Xxx (the " Executive
").
WHEREAS,
the Company desires to employ the Executive and to enter into an agreement
embodying the terms of such employment and considers it essential to its
best
interests and the best interests of its stockholders to employ the Executive
during the term of the Agreement;
WHEREAS,
the Executive desires to accept such employment and enter into such an
agreement;
NOW,
THEREFORE, in consideration of the premises and mutual covenants herein and
for
other good and valuable consideration, the parties hereby agree as
follows:
1.
Term
of Employment. Subject
to Section 8 below, the term of the Executive's employment under this
Agreement shall commence on the Effective Date and shall end on October 2,
2009
(the " Initial
Period ");
provided
,
however
,
that
such term shall be automatically extended for additional one-year periods
(each,
a " Renewal
Period ")
unless, not later than 180 days prior to the expiration of the Initial
Period or a Renewal Period, as applicable, either party hereto shall provide
written notice of its or his desire not to extend the term hereof (a "
Non-Renewal
Notice ")
to the
other party hereto (the Initial Period, together with each Renewal Period
then
in effect, shall be referred to hereinafter as the " Employment
Term ").
2.
Position.
(a)
Duties.
The
Executive shall serve as the Company's Chief Executive Officer and President.
In
such position, the Executive shall have such duties and authority as shall
be
determined from time to time by the Board of Directors of the Company (the
"
Board
")
and as
shall be consistent with the by-laws of the Company as in effect from time
to
time; provided,
however,
that,
at all times, the Executive's duties and responsibilities hereunder shall
be
commensurate in all material respects with his status as the senior-most
officer
of the Company. During the Employment Term, the Executive shall devote his
full
time and best efforts to his duties hereunder. The Executive shall report
directly to the Board (or any committee of the Board designated for this
purpose). In addition, as of the Effective Date, the Board shall appoint
the
Executive a member of the Board, and the Executive agrees to continue to
serve
during the Employment Term as a member of the Board to the extent he is
periodically elected or appointed to such position in accordance with the
by-laws of the Company and applicable law.
(b)
Company
Code of Conduct. The
Executive shall comply in all respects with the NASD Code of Conduct as may
be
amended from time to time (the " Code
of Conduct "),
and
the Executive hereby acknowledges that he has received a copy of the Code
of
Conduct. Pursuant to the Code of Conduct, and subject to Section 9 below,
the Executive shall be required to: (i) disclose to the Audit Committee of
the board of directors of the National Association of Securities
Dealers, Inc. (the " Audit
Committee ")
the
names of the boards of directors, boards of advisors or boards of trustees
on
which he currently serves and (ii) obtain prior approval from the Audit
Committee for service as a new director of any publicly traded company, which
approval shall not be unreasonably withheld. The Executive agrees to accept
the
final Audit Committee decision on the suitability of all present and future
directorships as binding. Subject to the foregoing, the Executive may, in
accordance with the Code of Conduct, (i) engage in personal activities
involving charitable, community, educational, religious or similar
organizations, (ii) manage his personal investments and (iii) continue
to serve as a member of the boards of directors, boards of advisors or boards
of
trustees on which he is serving on the Effective Date; provided
,
however
,
that,
in each case, such activities are in all respects consistent with applicable
law
and are in accordance with Section 9 below.
3.
Base
Salary. During
the Employment Term, the Company shall pay the Executive a base salary (the
"
Base
Salary ")
at an
annual rate of $40,000.00. The Base Salary shall be payable in regular payroll
installments in accordance with the Company's payroll practices as in effect
from time to time. The Management Compensation Committee of the Board (the
"
Compensation
Committee ")
shall
review the Base Salary at least annually and may (but shall be under no
obligation to) increase (but not decrease) the Base Salary on the basis of
such
review.
4.
Annual
Bonus; Transition Bonus. N/A
5.
Equity
Compensation. The
Company will issue the
Executive
a
stock
base salary of 1,000,000 shares
of the
Company’s common stock to be restricted under SEC rule 144. Further, it is
agreed that such shares of common stock will be restricted in that the shares
of
common stock are to “vest” over the initial two year term of this Agreement,
beginning on the date this Agreement
is
signed below. Additionally,
the
Executive
or the
Company may terminate this Agreement
or
the
Executive
may
resign or be terminated by the Company with immediate effect. Upon resignation
or termination before the end of the two year term, if applicable, the
Executive
will
return the pro-rata unvested shares of common stock which are intended to
vest
over a two year term beginning with the date of this Agreement.
6.
Employee
Benefits.
(a)
Generally.
During
the Employment Term, the Company shall provide the Executive with benefits
on
the same basis as benefits are generally made available to other senior
executives of the Company, including, without limitation, medical, dental,
vision, disability and life insurance and pension benefits. The Executive
shall
be entitled to four weeks of paid vacation; provided
,
however
,
that,
in the event the Executive's employment ends for any reason, the Executive
shall
be paid only for unused vacation that accrued in the calendar year his
employment terminated and any unused vacation for any prior year shall be
forfeited.
(b)
SERP
Participation and Provisions. The
Executive shall be entitled to participate in the National Association of
Securities Dealers, Inc. Supplemental Executive Retirement Plan (the "
SERP
")
and is
hereby designated an " Executive
Participant "
for
purposes of the SERP. The Company has made available to the Executive a complete
copy of the SERP in effect as of the Effective Date. Notwithstanding any
term or
condition contained in the SERP to the contrary:
(i) Section 4.1
of the SERP shall be applied as if the age and service requirements stated
therein were age 49 and four years of service rather than age 55 and ten
years
of service. Accordingly, the Executive shall be 100% vested in his accrued
SERP
benefit upon the later of his attainment of age 49 while employed and his
completion of four years of service.
(ii) Section 4.1
of the SERP shall be applied as if the age and service requirements stated
therein were satisfied upon the Executive's termination of employment by
the
Company without Cause or by the Executive for Good Reason pursuant to
Section 8(b) below. Accordingly, under such circumstances, the Executive
shall be 100% vested in his SERP benefit even if his employment terminates
prior
to his attaining age 49 and having completed four years of service with the
Company.
(iii) The
death benefit provided in Section 5.1 of the SERP shall become payable if
the Executive dies before his SERP benefit commences, but after having satisfied
the requirements of Section 4.1 of the SERP prior to modification by
Section 6(b)(i) above (and, if the foregoing conditions are satisfied,
such death benefit will be payable even if the Executive's death occurs after
he
has left employment with vested rights under the SERP, but before payment
of the
SERP benefit commences).
(iv) Section 4.3
of the SERP (relating to early retirement) shall be applied as if the service
requirement stated therein were five years of service rather than ten years
of
service; provided
that
this
special rule shall not permit the Executive's SERP benefit to start earlier
than
age 55.
(v) The
provisions of this Section 6(b) shall not accelerate the rate at which the
SERP benefit accrues so that the amount of the accrued SERP benefit shall
be
determined with reference to an accrual over a period of 3,650 days as
provided in Section 4.2(a) of the SERP.
7.
Business
and Other Expenses.
(a)
Business
Expenses. During
the Employment Term, the Company shall reimburse the Executive for reasonable
business expenses incurred by him in the performance of his duties hereunder
in
accordance with the policy established by the Compensation Committee.
Accordingly, the Company shall reimburse the Executive's expenses associated
with business travel in accordance with such policy.
(b)
Transportation
and Security. During
the Employment Term, in accordance with the directives of the Compensation
Committee, the Company shall provide the Executive with an automobile and
driver
during the business week for personal and business use and at other times
as
required for business purposes. The driver shall have security training if
the
Executive and the Compensation Committee determine in good faith that such
security training is necessary or advisable for the personal safety of the
Executive or his family. As soon as practicable following the Effective Date,
the Company, at its expense, shall conduct a security audit at the Executive's
New Jersey residence and, if necessary, install or upgrade the Executive's
home
security system at a reasonable cost to the Company not to exceed
$10,000.00.
(c)
Legal
Fees. The
Company shall pay or reimburse the Executive for his reasonable legal fees
and
expenses incurred in connection with the negotiation and execution of this
Agreement upon presentation by the Executive of written invoices or receipts
setting forth in reasonable detail the basis for such legal fees and expenses
in
an amount not to exceed $20,000.00.
8.
Termination.
Notwithstanding
any other provision of this Agreement, subject to the further provisions
of this
Section 8, the Company may terminate the Executive's employment or the
Executive may resign such employment for any reason or no stated reason at
any
time, subject to the notice and other provisions set forth below:
(a)
Generally.
In
the event of the termination of the Executive's employment for any reason,
the
Executive shall be entitled to receive payment of (i) any unpaid Base
Salary through the Date of Termination, (ii) subject to Section 6(a)
above, any accrued but unpaid vacation through the Date of Termination (as
defined below) and (iii) any earned but unpaid Annual Bonus with respect to
the calendar year ended prior to the Date of Termination (the " Base
Obligations ").
In
addition, in the event of the Executive's termination of employment, the
applicable provisions of the Option Agreements and any Restricted Stock
Agreement shall govern the treatment of the Options and the Restricted Shares,
respectively.
For
purposes of this Agreement, " Date
of Termination "
means
(i) in the event of a termination of the Executive's employment by the
Company for Cause or by the Executive for Good Reason, the date specified
in a
written notice of termination (or, if not specified therein, the date of
delivery of such notice), but in no event earlier than the expiration of
the
cure periods set forth in Section 8(b)(ii) or 8(b)(iii) below,
respectively; (ii) in the event of a termination of the Executive's
employment by the Company without Cause, the date specified in a written
notice
of termination (or if not specified therein, the date of delivery of such
notice); (iii) in the event of a termination of the Executive's employment
by the Executive without Good Reason, the date specified in a written notice
of
termination, but in no event less than 60 days following the date of
delivery of such notice; (iv) in the event of a termination of the
Executive's employment due to Permanent Disability (as defined below), the
date
the Company terminates the Executive's employment following the certification
of
the Executive's Permanent Disability; (v) in the event of a termination of
Employment due to the Executive's death, the date of the Executive's death;
or
(vi) in the event of a termination of the Executive's employment due to the
delivery of a Non-Renewal Notice, the date on which the Initial Period or
a
Renewal Period expires, as applicable.
(b)
Termination
by the Company Without Cause or by the Executive for Good
Reason.
(i) The
Executive's employment hereunder may be terminated by the Company without
Cause
or by the Executive for Good Reason. Upon the termination of the Executive's
employment by the Company without Cause or by the Executive for Good Reason,
the
Executive shall be entitled to receive, in addition to the Base Obligations,
the
following payments and benefits (the " Severance
Benefits "):
(A)
Severance
Payment . The
Company shall pay the Executive an amount (the " Severance
Payment ")
equal
to the sum of (I) the Base Salary paid to the Executive with respect to the
calendar year immediately preceding the Executive's Date of Termination and
(II) the Target Bonus for the calendar year immediately preceding the
Executive's Date of Termination, payable in substantially equal monthly
installments for the twelve-month period following the Executive's Date of
Termination, or such shorter period as the Board, in its sole discretion,
may
determine (the "Severance Period");
(B)
Transition
Bonus . The
Company shall pay the Executive the Transition Bonus (to the extent not already
paid) in accordance with the provisions of Section 4(e) above;
(C)
SERP
. The
Company shall provide the Executive the SERP benefit as set forth in
Section 6(b)(ii) above; and
(D)
Health
Care Coverage . The
Company shall provide the Executive with continued health care coverage for
the
lesser of (I) twelve months or (II) the date that the Executive is
eligible for coverage under the health care plans of a subsequent employer,
such
coverage to be conditioned upon the Executive (X) being covered by the
Company's health care plans immediately prior to the Date of Termination
and
(Y) paying his share of the applicable health care premiums, deductibles
and co-payments for such period of coverage.
Receipt
of the Severance Benefits by the Executive is subject to the execution by
him of
a general release of claims substantially in the form attached as Exhibit D
(the " Release
").
All
other benefits, if any, due the Executive following termination pursuant
to this
Section 8(b) shall be determined in accordance with the plans, policies and
practices of the Company; provided
,
however
,
that
the Executive shall not participate in any severance plan, policy or program
of
the Company. If, during the Severance Period, the Executive breaches in any
material respect any of his obligations under Section 9 or 10 below, the
Company may, upon written notice to the Executive, (x) terminate the
Severance Period and cease to make any further payments of the Severance
Payment
and (y) cease any health care coverage continuation, except in each case as
required by applicable law.
(ii) For
purposes of this Agreement, " Cause
"
shall
mean (A) the Executive's conviction of, or pleading nolo
contend ere to,
any
crime, whether a felony or misdemeanor, involving the purchase or sale of
any
security, mail or wire fraud, theft, embezzlement, moral turpitude, or Company
property (with the exception of minor traffic violations or similar
misdemeanors); (B) the Executive's repeated neglect of his duties to the
Company; or (C) the Executive's willful misconduct in connection with the
performance of his duties or other material breach by the Executive of this
Agreement; provided
,
however
,
that
the delivery of a Non-Renewal Notice by the Executive shall not constitute
Cause
for purposes of this Agreement; provided
further that
the
Company may not terminate the Executive's employment for Cause unless
(x) the Company first gives the Executive written notice of its intention
to terminate and of the grounds for such termination within 90 days
following the date the Board is informed of such grounds at a meeting of
the
Board and (y) the Executive has not, within 30 days following receipt
of such notice, cured such Cause (if capable of cure) in a manner that is
reasonably satisfactory to the Board.
(iii) For
purposes of this Agreement, " Good
Reason "
shall
mean the Company (A) reducing the Executive's position, duties, or
authority; (B) failing to secure the agreement of any successor entity to
the Company that the Executive shall continue in his position without reduction
in position, duties or authority; or (C) committing any other material
breach of this Agreement; provided
,
however
,
that
the delivery of a Non-Renewal Notice by the Company shall not constitute
Good
Reason for purposes of this Agreement; provided
further that
no
event or condition shall constitute Good Reason unless (x) the Executive
gives the Company a Notice of Termination specifying his objection to such
event
or condition within 90 days following the occurrence of such event or
condition, (y) such event or condition is not corrected, in all material
respects, by the Company in a manner that is reasonably satisfactory to the
Executive within 30 days following the Company's receipt of such notice and
(z) the Executive resigns from his employment with the Company not more
than 30 days following the expiration of the 30-day period described in the
foregoing clause (y).
(c)
Permanent
Disability.
(i) The
Executive's employment hereunder may terminate due to his Permanent Disability.
Upon termination of the Executive's employment due to Permanent Disability,
the
Executive shall be entitled to receive, in addition to the Base Obligations,
subject to the execution of a Release, the following payments and benefits
from
the Company: (i) a pro rata Target Bonus with respect to the calendar year
in which the Date of Termination occurs payable in a lump sum within
30 days following the Date of Termination and (ii) the Transition
Bonus (to the extent not already paid) in accordance with the provisions
of
Section 4(e) above. All other benefits, if any, due the Executive following
termination pursuant to this Section 8(c) shall be determined in accordance
with the plans, policies and practices of the Company; provided
,
however
,
that
the Executive shall not participate in any other severance plan, policy or
program of the Company.
(ii) For
purposes of this Agreement, " Permanent
Disability "
means
the inability of the Executive to perform substantially all of his duties
in the
manner required by the Agreement, whether by reason of illness or injury
or
otherwise (whether physical or mental) incapacitating the Executive for a
continuous period exceeding 120 days (or a period of six months in any
twelve-month period). Such Permanent Disability shall be certified by a
physician chosen by the Company and reasonably acceptable to the Executive
(if
he is then able to exercise sound judgment).
(d)
Death.
The
Executive's employment hereunder may terminate due to his death. Upon
termination of the Executive's employment hereunder due to death, the
Executive's estate shall be entitled to receive, in addition to the Base
Obligations, the following payments and benefits from the Company: (i) a
pro rata Target Bonus with respect to the calendar year in which the Date
of
Termination occurs, payable in a lump sum within 30 days following the Date
of Termination and (ii) the Transition Bonus (to the extent not already
paid) in accordance with the provisions of Section 4(e) above. All other
benefits, if any, due the Executive's estate following termination pursuant
to
this Section 8(d) shall be determined in accordance with the plans,
policies and practices of the Company.
(e)
For
Cause by the Company or Without Good Reason. The
Executive's employment hereunder may be terminated by the Company for Cause
or
by the Executive without Good Reason. Upon termination of the Executive's
employment for Cause or without Good Reason pursuant to this Section 8(e),
in the event the Date of Termination occurs prior to the second anniversary
of
the Effective Date, the Executive shall repay to the Company the Transition
Bonus in accordance with the provisions of Section 4(e) above. The
Executive shall have no further rights to any compensation (including any
Annual
Bonus or Transition Bonus) or any other benefits under this Agreement other
than
the Base Obligations. All other benefits, if any, due the Executive following
the Executive's termination of employment pursuant to this Section 8(e)
shall be determined in accordance with the plans, policies and practices
of the
Company; provided
,
however
,
that
the Executive shall not participate in any severance plan, policy, or program
of
the Company.
(f)
Non-Renewal
of Employment Term. The
Executive's employment hereunder may be terminated by either the Executive
or
the Company by delivery of a Non-Renewal Notice in accordance with the
provisions of Section 1 above. Upon termination of the Executive's
employment with the Company following the delivery of a Non-Renewal Notice,
the
Executive shall be entitled to receive, in addition to the Base Obligations,
the
SERP benefit. Upon termination of the Executive's employment pursuant to
this
Section 8(f), the Executive shall have no further rights, other than those
set forth in this Section 8(f), to any compensation or benefits under this
Agreement. All other benefits, if any, due the Executive following termination
pursuant to this Section 8(f) shall be determined in accordance with the
plans, policies and practices of the Company; provided
,
however
,
that
the Executive shall not participate in any severance plan, policy or program
of
the Company.
(g)
Consulting
Arrangement. Notwithstanding
anything to the contrary in this Agreement, in the event of a termination
of the
Executive's employment under Section 8(b) or 8(f) above, the Company, in
its discretion and subject to the approval of the Board and the Executive,
may
engage the Executive as a consultant for a period commencing on the Date
of
Termination and ending on the first anniversary thereof (the " Consulting
Period ");
provided
,
however
,
that
the Company may, upon written notice to the Executive, terminate the Consulting
Period for any reason and at any time. The Executive's services during the
Consulting Period shall consist of such consulting and advisory services,
and
shall be provided at such times, as may be requested from time to time by
the
Board. During the Consulting Period, the Company shall pay the Executive,
as
compensation for the consulting services to be performed by the Executive,
a fee
as shall be mutually agreed upon by the Company and the Executive. The Executive
and the Company hereby agree that during the Consulting Period the Executive
shall not be an employee of the Company but shall act in the capacity of
an
independent contractor. Consequently, the Executive shall not be entitled
to
participate during the Consulting Period in any of the benefit plans, policies
and practices of the Company, except as required by applicable law.
(h)
Mitigation;
Offset. Following
the termination of his employment under any of the above clauses of this
Section 8, the Executive shall have no obligation or duty to seek
subsequent employment or engagement as an employee (including self-employment)
or as a consultant or otherwise mitigate the Company's obligations hereunder;
nor shall the payments provided by this Section 8 be reduced by the
compensation earned by the Executive as an employee or consultant from such
subsequent employment or consultancy.
9.
Non-Competition;
Non-Solicitation; Confidentiality. The
Executive acknowledges and recognizes the highly competitive nature of the
businesses of the Company and accordingly agrees as follows:
(a)
Non-Competition.
For
a period of one year following the Date of Termination (the " Restricted
Period "),
regardless of the circumstances surrounding such termination of employment,
the
Executive will not, directly or indirectly, (i) engage in any "Competitive
Business" (as defined below) for the Executive's own account, (ii) enter
the employ of, or render any services to, any person engaged in a Competitive
Business, (iii) acquire a financial interest in, or otherwise become
actively involved with, any person engaged in a Competitive Business, directly
or indirectly, as an individual, partner, shareholder, officer, director,
principal, agent, trustee or consultant, or (iv) interfere with business
relationships (whether formed before or after the date of this Agreement)
between the Company and customers or suppliers of the Company. For purposes
of
this Agreement, " Competitive
Business "
shall
mean (x) any national securities exchange registered with the Securities
and Exchange Commission, (y) any electronic communications network or
(z) any other entity that engages in substantially the same business as the
Company, in each case in North America or in any other location in which
the
Company operates. For purposes of this Agreement, " person
"
shall
mean an individual, corporation, partnership, limited partnership, limited
liability company, syndicate, person (including, without limitation, a "person"
as defined in Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended), trust, association or entity or government, political subdivision,
agency or instrumentality of a government.
(b)
Non-Solicitation.
During
the Restricted Period, the Executive will not, directly or indirectly,
(i) interfere with any relationship between the Company and any of its
employees, consultants, agents or representatives; (ii) employ or otherwise
engage, or attempt to employ or otherwise engage, any current or former
employee, consultant, agent or representative of the Company in any Competitive
Business; (iii) solicit the business or account of the Company or any
affiliate; or (iv) divert or attempt to divert from the Company any
business or interfere with any relationship between the Company and any of
its
clients or customers.
(c)
Securities
Ownership. Notwithstanding
anything to the contrary in this Agreement, the Executive may, directly or
indirectly, own, solely as an investment, securities of any person engaged
in
the business of the Company which are publicly traded on a national or regional
stock exchange or on the over-the-counter market if the Executive (i) is
not a controlling person of, or a member of a group which controls, such
person
and (ii) does not, directly or indirectly, own one percent or more of any
class of securities of such person.
(d)
Confidentiality.
The
Executive hereby agrees that he will comply with the Company's general policies
regarding confidentiality of information and processes. Without in any way
limiting the foregoing sentence, the Executive further agrees that he will
not,
at any time during or after the Employment Term, make use of or divulge to
any
other person, firm or corporation any trade or business secret, process,
method
or means, or any other confidential information concerning the business or
policies of the Company, which he may have learned in connection with his
employment. For purposes of this Agreement, a "trade or business secret,
process, method or means, or any other confidential information" shall mean
and
include written information treated as confidential or as a trade secret
by the
Company. The Executive's obligation under this Section 9(d) shall not apply
to any information which (i) is known publicly; (ii) is in the public
domain or hereafter enters the public domain without the fault of the Executive;
(iii) is known to the Executive prior to his receipt of such information
from the Company; or (iv) is hereafter disclosed to the Executive by a
third party not under an obligation of confidence to the Company. The Executive
agrees not to remove from the premises of the Company, except as an employee
of
the Company in pursuit of the business of the Company or except as specifically
permitted in writing by the Board, any document or other object containing
or
reflecting any such confidential information. The Executive recognizes that
all
such documents and objects, whether developed by him or by someone else,
will be
the sole exclusive property of the Company. Except as specifically authorized
by
the Board upon termination of his employment hereunder, the Executive shall
forthwith deliver to the Company all such confidential information, including,
without limitation, all lists of customers, correspondence, accounts, records
and any other documents (whether or not electronically or digitally produced)
or
property made or held by him or under his control in relation to the business
or
affairs of the Company, and no copy of any such confidential information
shall
be retained by him.
(e)
Severability.
It
is expressly understood and agreed that, although the Executive and the Company
consider the restrictions contained in this Section 9 to be reasonable, if
a final judicial determination is made by a court of competent jurisdiction
that
the time or territory or any other restriction contained in this Agreement
is an
unenforceable restriction against the Executive, the provisions of this
Agreement shall not be rendered void, but shall be deemed amended to apply
as to
such maximum time and territory and to such maximum extent as such court
may
judicially determine or indicate to be enforceable. Alternatively, if any
court
of competent jurisdiction finds that any restriction contained in this Agreement
is unenforceable, and such restriction cannot be amended so as to make it
enforceable, such finding shall not affect the enforceability of any of the
other restrictions contained herein.
10.
Nondisparagement.
The
Executive agrees (whether during or after the Executive's employment with
the
Company) not to issue, circulate, publish or utter any false or disparaging
statements, remarks or rumors about the Company or its shareholders unless
giving truthful testimony under subpoena. The Company agrees (whether during
or
after the Executive's employment with the Company) not to issue, circulate,
publish or utter any false or disparaging statements, remarks or rumors about
the Executive unless giving truthful testimony under subpoena. Notwithstanding
the foregoing, nothing in this Section 10 shall preclude either party from
responding to correct false or disparaging statements, remarks or
rumors.
11.
Specific
Performance. The
Executive acknowledges and agrees that the Company's remedies at law for
a
breach or threatened breach of any of the provisions of Section 9 or
Section 10 above would be inadequate and, in recognition of this fact, the
Executive agrees that, in the event of such a breach or threatened breach,
in
addition to any remedies at law, the Company, without posting any bond, shall
be
entitled to obtain equitable relief in the form of specific performance,
temporary restraining order, temporary or permanent injunction or any other
equitable remedy which may then be available.
12.
Disputes.
Except
as provided in Section 11 above, any future dispute, controversy or claim
between the parties arising from or relating to this Agreement, its breach
or
any matter addressed by this Agreement shall be resolved through binding,
confidential arbitration to be conducted by a panel of three arbitrators
that is
mutually agreeable to both the Executive and the Company, all in accordance
with
the arbitration rules of the American Arbitration Association set forth in
its
National Rules for the Resolution of Employment Disputes then in effect (the
"
AAA's
Arbitration Rules ").
If
the Executive and the Company cannot agree upon the panel of arbitrators,
the
arbitration shall be settled before a panel of three arbitrators, one to
be
selected by the Company, one by the Executive and the third to be selected
by
the two persons so selected, all in accordance with the AAA's Arbitration
Rules.
The arbitration proceeding shall be held in New York City or such other location
as is mutually agreed in writing by the parties. The arbitrators shall base
their award on the terms of this Agreement, and the arbitrators shall strictly
follow the law and judicial precedents that a United States District Judge
sitting in the Southern District of the State of New York would apply in
the
event the dispute were litigated in such court. The arbitration shall be
governed by the substantive laws of the State of New York applicable to
contracts made and to be performed therein, and by the arbitration law chosen
by
the arbitrators, and the arbitrators shall have no power or authority to
order
or grant any remedy or relief that a court could not order or grant under
applicable law. Judgment upon the award rendered by the arbitrators may be
entered in any court having jurisdiction thereof. The Company shall bear
the
cost of the arbitrators. Costs and expenses associated with the arbitration
that
are not otherwise assignable to one of the parties shall be allocated equally
between the parties. In every other respect, the parties shall each pay their
own costs and expenses, including, without limitation, attorneys' fees and
costs. Nothing contained in this Section 12 shall be construed to preclude
the Company from exercising its rights under Section 11 above.
13.
Miscellaneous.
(a)
Acceptance.
(i) The
Executive hereby represents and warrants, as a material inducement to the
Company's agreement to enter into this Agreement, other than the SunGard
Restrictive Covenants (as defined below), that there are no legal, contractual
or other impediments, including, without limitation, restrictive covenants
with
a current or former employer, precluding the Executive from entering into
this
Agreement or from performing the services with the Company contemplated hereby.
Any violation of this representation and warranty by the Executive shall
render
all of the obligations of the Company under this Agreement void ab
initio and
of no
force and effect.
(ii) The
Executive and the Company hereby acknowledge that the Executive is a party
to an
employment agreement and an acquisition agreement with SunGard Data
Systems, Inc. (" SunGard
")
that
contain restrictive covenants that purport to limit the Executive's business
activities following his termination of employment with SunGard (the "
SunGard
Restrictive Covenants ").
The
Executive and the Company hereby agree that in the event that the Board
determines in good faith that the SunGard Restrictive Covenants (x) present
a material impediment to the Executive's performance of his duties or to
the
conduct of the Company's day-to-day business or the implementation of the
Company's business plan, or (y) preclude the Company from pursuing any
reasonable business objective, the Board in its discretion may, notwithstanding
anything to the contrary in subsections (a), (b), (c) or (d) of
Section 4 above, adjust in an equitable manner the Executive's incentive
compensation from the Company, including, without limitation, reducing the
Annual Bonus or Target Bonus or adjusting the Executive's equity compensation,
other than such equity compensation granted pursuant to Section 5 above.
This Section 13(a) shall not be deemed to be an acknowledgement or an
admission by either the Executive or the Company as to the interpretation,
applicability, waiver, effectiveness or enforceability of the SunGard
Restrictive Covenants.
(b)
Entire
Agreement; Amendments. This
Agreement contains the entire understanding of the parties with respect to
the
employment of the Executive by the Company and shall supersede any and all
previous contracts, arrangements or understandings between the Company and
the
Executive with respect to the subject matter set forth herein, including,
without limitation, the Term Sheet. There are no restrictions, agreements,
promises, warranties, or covenants by and between the Company and the Executive
and undertakings between the parties with respect to the subject matter herein
other than those expressly set forth herein. This Agreement may not be altered,
modified or amended except by written instrument signed by the parties
hereto.
(c)
No
Waiver. The
failure of a party to insist upon strict adherence to any term of this Agreement
on any occasion shall not be considered a waiver of such party's rights or
deprive such party of the right thereafter to insist upon strict adherence
to
that term or any other term of this Agreement.
(d)
Severability.
In
the event that any one or more of the provisions of this Agreement shall
be or
become invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions of this Agreement shall not
be
affected thereby.
(e)
Successor;
Assignment. This
Agreement is confidential and personal and neither of the parties hereto
shall,
without the consent of the other, assign or transfer this Agreement or any
rights or obligations hereunder. Without limiting the foregoing, the Executive's
right to receive payments hereunder shall not be assignable or transferable
whether by pledge, creation of a security interest or otherwise, other than
a
transfer by the Executive's will or by the laws of descent and distribution.
In
the event of any attempted assignment or transfer contrary to this
Section 13(e), the Company shall have no liability to pay the assignee or
transferee any amount so attempted to be assigned or transferred. The Company
shall cause this Agreement to be assumed by any entity that succeeds to all
or
substantially all of the Company's business or assets and this Agreement
shall
be binding upon any successor to all or substantially all of the Company's
business or assets; provided
,
however
,
that no
such assumption shall release the Company of its obligations hereunder, to
the
extent not satisfied by such successor, without the Executive's prior written
consent.
(f)
Confidentiality
of Tax Treatment and Structure. Notwithstanding
anything herein to the contrary, each party and its representatives may consult
any tax advisor regarding the tax treatment and tax structure of this Agreement
and may disclose to any person, without limitation of any kind, the tax
treatment and tax structure of this Agreement and all materials (including
opinions or other tax analyses) that are provided relating to such treatment
or
structure.
(g)
Notice.
For
the purpose of this Agreement, notices and all other communications provided
for
in this Agreement shall be in writing and shall be deemed to have been duly
given when delivered or mailed by United States registered mail, return receipt
requested, postage prepaid, addressed to the respective addresses set forth
on
the execution page of this Agreement, provided
that
all
notices to the Company shall be directed to the attention of the General
Counsel
or to such other address as either party may have furnished to the other
in
writing in accordance herewith, except that notice of change of address shall
be
effective only upon receipt:
|
(1)
|
if
to the Company:
|
|
|
The
Office of the General Counsel
|
||
|
Xxxxxxx.xxx,
Inc.
|
||
|
0xx
Xxxxx, Xxxxxxx Xxxxxxxx Xxxxx Xxxx.,00 Xxxxxxxxxxxx St., Chongwen
Dist.,
|
||
|
Beijing
100062,China
|
||
|
(2)
|
if
to the Executive:
|
|
|
x/x
Xxxxxxx.xxx, Xxx.
|
||
|
0xx
Xxxxx, Xxxxxxx Business World Xxxx.,00 Xxxxxxxxxxxx Xx., Xxxxxxxx
Xxxx.,
|
||
|
Xxxxxxx
000000,Xxxxx
|
||
|
Attention:
Xxxx Xxx (Ruibo Lun)
|
This
address as shown in the records of the Company
(h)
Withholding
Taxes. The
Company may withhold from any amounts payable under this Agreement such federal,
state and local taxes as may be required to be withheld pursuant to any
applicable law or regulation.
(i)
Counterparts.
This
Agreement may be signed in counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the
same
instrument.
(j)
Governing
Law. This
Agreement shall be governed by and construed in accordance with the laws
of the
State of New York.
* * *
IN
WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the
day and year first above written.
|
EXECUTIVE
|
||
| |
|
|
| By: | /s/ Xxxx X. Xxx | |
|
Xxxx X. Xxx |
||
|
XXXXXXX.XXX, INC.
|
||
| |
|
|
| By: | /s/ Xxx Xxx | |
|
|
||
| Title |
Director of the Board
|
|
|
Date:
|
10/03/2007
|
|
