EXHIBIT 10.1
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT ("Agreement") is made as of this 11th
day of May 2006, by and between Next Generation Media Corp, a Nevada
corporation, its subsidiaries, successors and assigns ("NGMC" or
"Employer") and Xxxxxx X. Xxxx, an individual ("Employee").
WITNESSETH:
WHEREAS, the Employee has agreed to be employed by the Employer as
its Chief Executive Officer and President, as well as to be the Chief
Executive Officer and President of NGMC's operational entity and its
wholly-owned subsidiary, United Marketing Solutions, Inc. ("United");
and
WHEREAS, it is in the Employer's best interest to obtain the
services of the Employee; and
WHEREAS, the Employer and the Employee have previously engaged in
negotiations regarding the terms and conditions of their future
employment relationship; and
WHEREAS, the Employer and the Employee are desirous of now
committing to writing the agreed upon terms and conditions of their
future employment relationship by way of this Agreement.
NOW, THEREFORE, for and in consideration of valuable consideration
and the covenants, conditions and promises herein contained, it is
hereby agreed as follows:
1. Employment. The Employer, by authorization of a resolution
duly adopted by Employer's Board of Directors ("the Board"), hereby
authorizes and agrees to employ the Employee, and the Employee hereby
accepts said employment upon the terms and conditions hereinafter set
forth.
2. Positions and Titles. The Employee shall have the title of
Chief Executive Officer and President of NGMC, and shall be appointed
to such standing committees of the Employer that are or may be formed
during the period of this Agreement. The Employee shall perform such
duties as are normally associated with the position of Chief Executive
Officer and President of the Employer and such additional duties as
may, from time to time, be assigned by the Board, and shall further
have the usual authority associated with said position and office as
more fully described in the Bylaws of the Employer in effect during the
term of this Agreement. The Employee shall also be the Chief Executive
Officer and President of United and shall perform all such duties as
are normally associated with the position of President and such
additional duties as may, from time to time, be assigned by the Board,
and shall further have the usual authority associated with said
position and office as more fully described in the Bylaws of United in
effect during the term of this Agreement
3. Term. The term or period of this Agreement shall be for the
period beginning on the date of execution hereof and ending on the day
after the three year anniversary of the date hereof, provided, however,
that the term of this Agreement shall be automatically extended under
the same terms and conditions for three additional years unless at
least ninety (90) days prior to expiration of the initial term or any
subsequent term, either party shall deliver to the other written notice
of their intent to terminate said employment or to negotiate other
terms and conditions thereof. In the event this Agreement is not
renewed or extended and Employee does not enter into a new employment
agreement with Employer, Employee shall be paid compensation which
would have been paid under this Agreement for Two (2) years after
expiration of the initial term or any subsequent terms. The Employee
agrees to remain in the employ of the Employer during the period this
Agreement is in effect unless terminated pursuant to any of paragraphs
7, 8 or 12.
4. Performance of Duties. During the period of the Employee's
employment, the Employee shall perform faithfully the duties required
of him and agrees to devote that amount of time, attention, skill and
ability necessary to properly perform said duties. It is also
understood and agreed that the Employee may, from time to time, serve
on the boards of directors of other corporations as may be approved by
the Board, whose approval shall not be unduly withheld, provided that
such service does not actually interfere with the performance of his
duties to Employer.
5. Compensation. The employer shall pay to the Employee as
compensation for his services hereunder, the amounts set forth, subject
to the further provisions of this paragraph:
(A) Base Salary. The Employee shall be paid according to
the following: The First Year shall have a base salary of Two Hundred
and Nine Thousand ($209,000.00), payable pursuant to the Employer's
salary payment practices; The Second Year shall increase the First
Year's base salary by five percent (5%) to Two Hundred and Twenty
Thousand Dollars ($220,000); and the Third Year shall again increase
the previous year's salary by five percent (5%) to a base salary of Two
Hundred and Thirty-One Thousand ($231,000). The Employee shall be paid
according to the current payment standards in place with the Employer.
In the event that this Agreement carries over for a second term as
provided for under Paragraph No. 3, above, the same five percent (5%)
increases for each year shall be applied to each successive year.
It is also agreed that the Employer shall grant to the
Employee 500,000 options per year of employment pursuant to this
Agreement at a strike price of Ten Cents ($0.10), which is the current
share price of NGMC as of the date of this Agreement. These options
shall vest at the beginning of each new employment year and shall have
a term of ten (10) years from the date of grant before they expire.
(B) Annual Cash Bonus. In addition to the compensation set
forth in subsection 5(A) above, during the term of this Agreement,
Employee may be entitled to a cash bonus (the "Annual Bonus") for the
fiscal years ending December 31 based on Employee's and Employer's
performance during such fiscal year. The standard for determining an
Annual Bonus shall be according to the following: In any year that the
Employer has a positive net profit for that particular fiscal year
("Net Profit"), for the first Two Hundred Thousand Dollars ($200,000)
Net Profit, the Employee shall receive an Annual Bonus calculated at a
percentage rate of Two Five Percent (5.0%) of the Net Profit, and the
Employee shall receive an Annual Bonus calculated at a percentage rate
of Seven Percent (7%) of the Net Profit if the Net Profit is greater
than Two Hundred and Fifty Thousand Dollars ($250,000). The Annual
Bonus shall be paid no later than March 31 of the year after the year
in which said bonus is earned.
(C) Director's and Committee Attendance Fees. The Employee
shall be entitled to receive fees for attendance at all meetings of the
Board and standing committees to which he has been appointed, payable
at such times as shall be in accordance with the Employer's practices
and at the rates determined by the Board and the Compensation Committee
of NGMC.
6. Additional Benefits. In addition to the salary specified in
Paragraph 5(A) and Annual Bonus specified in Paragraph 5B above,
Employer shall provide Employee comparable additional benefits as are
provided to other senior officers of Employer; provided, however, the
said additional benefits shall not be less favorable to Employee than
as more particularly described in subparagraphs (A) through (F) of this
paragraph 6.
(A) Vacations and Sick Leave. The Employee shall be
entitled to four (4) weeks of vacation and sick leave for each year of
employment. Time allotted for vacation and sick leave that is not used
shall accrue to the next year.
(B) Business Expenses. The Employer will reimburse the
Employee in full for all reasonable expenses incurred by the Employee
in pursuit of the Employer's business during the period of this
Agreement. The Employee shall be required to submit the appropriate
expense reports and vouchers in support of the expenses incurred on
behalf of the Employer as required by the general practices and
procedures of the Employer and in compliance with all reasonable
business expense requirements of the Internal Revenue Service.
(C) Hospital, Medical and Dental Reimbursement Plan. The
Employer shall provide, at its cost, health, major medical and dental
benefits for the Employee and his immediate family.
(D) Life Insurance. The Employer shall provide, at its cost,
term life insurance with a death benefit of not less than $1,500,000.
The Employer will be the owner of the policy and the Employee will be
the insured. The "Split Dollar" concept will be used. The Employee
will be responsible for taxes due in relation to the term cost or PS-52
table, whichever is less.
(E) Automobile. During the term hereof, the Employer shall
provide the Employee with an automobile or monthly car allowance at a
rate of Six Hundred Dollars ($600) per month.
(F) Disability. If the Employee becomes unable to perform
the services expected hereunder by reason of illness or incapacity, his
full compensation, including Annual Bonus and all benefits, shall be
continued for a period of 180 days from the last day of the month that
the Corporation determines that the Employee is first disabled. At the
end of such 180 days, his compensation by the Employer shall cease; but
said Employee shall be entitled to a leave of absence for the balance
of the term of the Agreement, during any continuance of such inability
to perform. The Employer, at its expense, will acquire disability
insurance on the Employee in an amount equal to sixty-percent (60%) of
the Employee's base salary (exclusive of additional Annual Bonus),
which will become effective after a 180-day waiting period. Proceeds
from such disability insurance will be paid directly to Employee by the
insurance carrier, as provided by the insurance policy.
(G) Retirement. The Employee shall be entitled to
participate in, and receive benefits under and in accordance with, any
pension plan (including, but not limited to, a 401(k) plan) or any
other retirement plan or program of Employer either in existence as of
the date hereof or hereafter adopted for the benefit of any of its
executive employees.
7. Termination. This Agreement may be terminated pursuant to
the following:
(A) Voluntary Termination by either the Employee or the
Employer. The Employee may voluntarily terminate this Agreement by
providing ninety (90) days written notice to Employer in the event of a
termination pursuant to this subparagraph. All compensation hereunder
shall terminate as of the effective date of such termination. The
Employer may voluntarily terminate this Agreement by providing ninety
(90) days written notice to the Employee "Written Notice". For the
right to voluntarily terminate the Employee, the Employer must pay to
the Employee the entire amount remaining on this Agreement or Five
Hundred Thousand Dollars ($500,000), whichever is greater, payable on
the last day of the Written Notice. All options earned will remain in
force, and all Annual Bonus Cash earned will be determined at the end
of the year in which the Written Notice is effective and pursuant to a
pro-rata formula based upon the time that had expired in that year
prior to the effective date of the Written Notice.
(B) Involuntary Termination. This Agreement may be
terminated by the Employer for "Just Cause", or as provided for in
paragraph 12. For purposes of this Agreement, "Just Cause" shall mean:
Unappealable conviction by a trial court of a felony or crime involving
moral turpitude; declaration of unsound mind by court order; or the
failure to diligently apply himself to the duties required by Employer.
In the event the Employee is judged by Employer as failing to
diligently apply himself to the duties hereunder, Employer will provide
written notice to Employee specifying with particularity the conduct
constituting such failure and such steps as are necessary to warrant
the deficiency of performance. Employee will be allowed thirty (30)
days from the date of such notice to attempt to correct the
deficiencies. Upon the expiration of this cure period, Employer will
provide written notice to Employee of the adequacy or failure of
efforts made by Employee to correct the deficiencies. The Employer
agrees to provide the Employee at least sixty (60) days written notice
of termination pursuant to this subparagraph. In the event of a
termination under this subparagraph (B), Employee shall be paid the
same compensation at the same times that would be paid under this
Agreement through the effective date of Employee's termination. In the
event of a termination pursuant to this subparagraph, the Annual Bonus
payable to Employee pursuant to paragraph 5(B) hereof, for the fiscal
year within which said termination occurs, shall be pro-rated and paid
to Employee through the date of termination of Employee's daily
managerial responsibilities.
(C) Severance Pay. Upon any termination pursuant to
paragraph 6(F) or 7(A) hereof, Employee shall be paid the compensation
that he would have been paid under this Agreement as provided for under
Paragraph 7(A) after the date of termination. Such compensation shall
include any Annual Bonus payable to Employee pursuant to paragraph 5(B)
hereof, for the fiscal year within which said termination occurs, which
Annual Bonus shall be pro-rated through the date of termination of
Employee's daily managerial responsibilities. Employer shall also
provide Employee, at the Employer's expense, for a period of twelve
(12) month's beginning with the date of termination, with life
insurance, medical insurance, dental insurance and long-term disability
insurance that, taken as a whole, are substantially similar to the
benefits provided to Employee immediately prior to the date of
termination.
8. Change of Ownership, Change of Title/Position. This
Agreement shall terminate in the event that the Employer or all or
substantially all of Employer's assets, and/or goodwill, or its stock
are purchased in conjunction with a corporate (stock or assets) sale,
or merger, or in the event that the Employee is no longer the Chief
Executive Officer and President of NGMC and its subsidiary. In such
event, Employee shall be entitled to his annual salary and Annual Bonus
from the effective date of such transaction, as well as the buyout
provision provided in Section 7(a), above, through the end of the term
of this Agreement, provided Employee is not offered the position under
the same terms and conditions of this agreement with the acquiring
company or operation. All such compensation and severance pay will be
paid within ninety (90) days of the effective date of the transaction.
In the event of such payment, Employer and Employee shall have no
further obligations under this Agreement except that Employer will pay
all premiums for health insurance policies then in effect for Employee,
through the end of such compensation period.
9. Obligations on Termination. In addition to the obligations
on the Employee set forth in paragraph 9 herein, upon termination of
employment for any reason, the Employee shall deliver to the Employer
all correspondence, letters, records, computer programs, data bases and
any and all other material pertaining to or containing information
relative to the business of the Employer or its affiliates which the
Employee has acquired during his association with Employer.
10. Indemnification. The Employer agrees to indemnify and defend
Employee (and his heirs, executor, and administrators) from all claims,
liabilities, judgments, settlements, costs and expenses, including all
attorneys' fees, imposed upon or reasonably incurred by him in
connection with or resulting from any action, suit, proceeding, or
claim to which he is or may be made a party by reason of his being or
having been an employee of the Employer (whether or not an employee at
the time such costs or expenses are incurred by or imposed upon him) to
the full extent provided for in the Employer's Articles of
Incorporation or the laws of the State of Nevada, whichever is broader,
as in effect on the date of execution hereof. Such right of
indemnification shall not be deemed exclusive of any rights to which he
may be entitled otherwise.
11. Death of Employee. In the event of the Employee's death
during the term of this Agreement, the Agreement shall stand terminated
and all payments hereunder shall ceases as of the date of death, except
as to the following:
(A) The base salary being paid to the Employee by the
Employer as of the date of death shall continue to be paid to
Employee's surviving spouse for a period of one hundred eighty (180)
days after the date of death.
(B) The Annual Bonus payable to the Employee by the Employer
for the fiscal year within which the date of death occurs shall be
prorated through the date of death.
(C) The Employer shall cooperate and take all necessary
steps to effectuate the payment of the life insurance proceeds
established in paragraph 6(D) of this Agreement.
(D) All accrued and unpaid benefits under this Agreement,
whatsoever in nature, shall be payable to the Employee's surviving
spouse.
12. Assignment of Agreement. The obligations of the Employer
under this Agreement shall be binding upon the successors and assigns
of the Employer. In the event this contract is assigned, Employee
shall be entitled to enforce the provisions of this Agreement or, in
his sole discretion, terminate this Agreement upon the terms provided
in paragraph 8 hereof. For purposes of this Agreement, the term
"successors" and "assigns" shall include any person, firm, corporation,
or other entity which at the time, whether by merger, reorganization,
purchase, or otherwise, shall acquire all or substantially all the
assets, stock, or business of the Company.
13. Amendments. This Agreement cannot be changed or terminated
orally and no waiver of compliance with any provision or condition
hereof shall be effective unless evidenced by an instrument in writing
duly executed by the parties hereto and sought to be changes by such
waiver.
14. Writing. This Agreement sets forth the entire understanding
of the parties with respect to the employment of the Employee by the
Employer and supersedes any and all prior agreements, arrangements and
understanding relating to the subject matter hereof. This Agreement
shall be binding upon and inure to the benefit of the parties and their
respective successors and assigns.
15. Waiver. The waiver by the Employer or the Employee of any
breach of any provisions of this Agreement shall not operate or be
construed as a waiver of any subsequent breach of this Agreement.
16. General Provisions.
(A) Should any controversy or claim arise out of or relate
to the Agreement, or a breach thereof, the parties shall attempt to
negotiate a settlement of their differences. If, however, the
negotiations are unsuccessful, either party may seek the aid of a court
of competent jurisdiction in Virginia. In that event, the court shall
deny attorneys' fees and costs to the party not prevailing and award
the same to the party who prevails. Notwithstanding the foregoing, any
controversy or claims arising out of, or relating to this Agreement or
the breach thereof, shall at the option of either party, be settled by
arbitration in the Washington, D.C. area in accordance with the rules
of commercial arbitration then obtaining of the American Arbitration
Association, and judgment upon the award rendered may be entered in any
court having jurisdiction thereof. Cost of such arbitration will be
borne by Employer.
(B) In the event that any term, provisions, or paragraph of
this Agreement is declared illegal, void or unenforceable, the same
shall not effect or impair the other terms, provisions or paragraphs of
this Agreement. Covenants contained in this Agreement shall be
independent. The doctrine of severability shall be applied. The
parties do not intend by this statement to imply the illegality,
voidability or unenforceability of any of the terms, provisions or
paragraphs of this Agreement.
17. Captions. The captions for each paragraph are not part of
this Agreement, but are for identification purposes.
18. Governing Law. This Agreement is made under and shall be
construed pursuant to the laws of Nevada.
19. Notices. Any notice, writing, report or other document
required or permitted hereunder shall be in writing and shall be given
by prepaid registered or certified mail, with return receipt requested,
addressed as follows:
IF TO THE EMPLOYER:
Next Generation Media Corporation
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
Attention: Chairman of the Compensation Committee
IF TO THE EMPLOYEE:
Xxxxxx X. Xxxx
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
The date of any such notice and of service thereof shall be seemed to
be the date of dispatch. Either party may change its address for
purposes of notice by giving notice in accordance with the provisions
of this paragraph.
IN WITNESS WHEREOF, the parties hereto have hereunto set their
hands and seals the date and year first above written.
FOR THE EMPLOYER:
Attest: Next Generation Media Corp.
Date: 05/11/06
By: /s/ Xxxxxxx Held Xxxxxxx
Xxxxxxx Held Xxxxxxx, Secretary
Date: 05/11/06
By: /s/ Xxxx Xxxxxx
Xxxx Xxxxxx
On behalf of
Next Generation Media Corporation
By Its Board of Directors
(CORPORATE SEAL)
THE EMPLOYEE:
Witness: Xxxx Xxxxxx Xxxxxx X. Xxxx
s/s Xxxx Xxxxxx s/s Xxxxxx X. Xxxx Date: 05/11/06
