ADDENDUM AND MODIFICATION TO EMPLOYMENT AGREEMENT
This ADDENDUM AND MODIFICATION TO EMPLOYMENT AGREEMENT ("Agreement") is
made and entered into this ___ day of May, 1999, by and between The Network
Connection, Inc. ("TNCI") and Xxxxxx X. Xxxxx, Xx. ("Employee").
WHEREAS, the parties entered into an Employment Agreement or related
agreements on or about October 31, 1998 (the "Employment Agreement"); and
WHEREAS, TNCI and Interactive Flight Technologies, Inc. ("IFT") entered
into an Asset Purchase and Sale Agreement, dated April 29, 1999 (the "Asset
Purchase Agreement"), and contemplate that IFT shall sell certain assets and
business interests to TNCI in exchange for shares of TNCI's capital stock (the
"Transaction"); and
WHEREAS, the Transaction is anticipated to benefit TNCI and its employees,
including Employee; and
WHEREAS, TNCI and Employee desire to modify their respective rights and
obligations under the Employment Contract to allow the Transaction to occur for
their mutual benefit;
NOW THEREFORE in consideration of the foregoing and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, and
intending to be legally bound, the parties to this Agreement hereby agree as
follows:
1. Provided that the Transaction closes on or before June 14, 1999, this
Agreement supersedes any inconsistent terms of the Employment Agreement,
specifically including all of paragraphs 6 and 7, but all other terms of the
Employment Agreement shall remain in full force and effect. In the event the
Transaction fails to close on or before June 14, 1999, this Agreement shall be
without effect.
2. Employee waives and relinquishes any and all rights pursuant to Section
7 of the Employment Agreement ("Severance"). Employee further waives and
relinquishes any and all rights under the original Employment Agreement or
otherwise relating to relocation; Employee understands that relocation may be
required and does not provide any right to terminate this Agreement or receive
any benefits or payments (other than reimbursement of reasonable expenses as
approved by TNCI in advance).
3. TNCI shall employee Employee, and Employee agrees to be employed with
TNCI, according to the terms set forth herein. Employee shall be employed as
Executive Vice President Business Development, with assignments to be determined
from time to time by the TNCI board of directors. The term of such employment
shall be two (2) years from the date the Transaction actually closes. During
this term, Employee may be terminated for "cause" or for "no cause." For
purposes of this Agreement, "cause" shall be deemed to mean TNCI's reasonable
belief that any of the following has occurred:
i. the recurring or continued failure of Employee to perform material
duties assigned to Employee after a written demand by TNCI identifying
the manner in which it believes Employee has not performed his duties
and Employee's subsequent failure to cure the identified problem
within a reasonable time; or
ii. the Employee's commission of fraud or dishonesty, or willful conduct
that (actually or potentially) significantly impairs the reputation
of, or xxxxx, TNCI, its subsidiaries or affiliates; or
iii. Wilful or reckless violation of TNCI's work rules, policies or
regulations.
4. After the initial two (2) year term of this Agreement, Employee's
employment shall terminate unless the parties otherwise agree in writing.
5. In the event Employee is terminated during the term of this Agreement by
TNCI for "no cause," Employee shall be entitled to receive a gross severance
benefit equal to the lesser of (a) one (1) year's base salary, or (b) Employee's
base salary for the remaining term of this Agreement. Any severance benefit paid
pursuant to this paragraph shall be payable (subject to payroll deductions) 50%
at the time of termination and the remaining 50% in six monthly installments. In
addition, as part of the severance, in the event Employee elects health care
benefits continuation under COBRA, TNCI shall pay or reimburse the cost of
Employee's premiums until Employee obtains alternative health care coverage, up
to a maximum of twelve (12) months. No severance pay shall be due in the event
Employee is terminated "for cause" at any time, or resigns or otherwise
initiates termination for any reason.
6. In view of the move of corporate headquarters to Arizona and the parties
interests in uniform interpretation of its rights and obligations, this
Agreement and the Employment Agreement shall be interpreted according to the
laws of the State of Arizona as governs transactions occurring wholly within the
State of Arizona between Arizona residents. Any dispute related to this
Agreement or the Employment Agreement, including any arbitration initiated
pursuant to paragraph 12 of the Employment Agreement shall be venued in Maricopa
County, Arizona.
7. This writing constitutes the entire agreement among the parties hereto
with respect to the subject matter hereof and shall not be altered or amended
except in a writing signed by the parties whose rights or obligations are
affected by such amendment or alteration.
IN WITNESS WHEREOF, the Parties have executed this Agreement effective as
of the day and year first written above.
THE NETWORK CONNECTION, INC.
May 14, 1999 By: /s/ Xxxxxx X. Xxxxx, Xx.
------------------------------- -------------------------------------
Dated Xxxxxx X. Xxxxx, Xx.
------------------------------- By: /s/ Xxxxxx X. Xxxxx
Dated -------------------------------------
The Network Connection, Inc.
