EXHIBIT 10.3
10.3 Employment Agreement, dated April 17, 1999 by and between
Mirage Holdings, Inc. and Xxxxxx X. Xxxxxx
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is made, entered into, and
effective as of April 17, 1999 (the "Effective Date"), by and between Mirage
Holdings, Inc., a Nevada corporation ("Company"), and Xxxxxx Xxxxxx, an
individual ("Employee").
RECITALS
A. Company is engaged in the technology industry and maintains an
office in Santa Monica, California.
B. Company desires to have an employment agreement with Employee for
the position set forth in SCHEDULE A subject to the terms and conditions of
this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained herein, the parties hereto hereby agree as follows:
AGREEMENT
1. TERM AND DUTIES. Company hereby employs Employee in the position set out
on SCHEDULE A to this Agreement, and Employee agrees to fulfil the duties and
responsibilities as the Chief Executive Officer, President and interim Chief
Financial Officer of the Company, subject to changes consistent with the
usual duties and responsibilities of that position as may be reasonably
prescribed by the Board of Directors of the Company (the "Board") from time
to time. Employee shall devote such time and attention to the business of
Company as shall be required to perform the required services and duties.
Employee at all times during the employment term shall strictly adhere to and
obey all policies, rules and regulations established from time to time
governing the conduct of employees of Company.
2. DUTIES OF EMPLOYEE.
2.1 Employee agrees to perform Employee's services efficiently and to
the best of Employee's ability. Employee agrees throughout the term of this
Agreement to devote his time, energy and skill to the business of the Company
and to the promotion of the best interests of the Company.
2.2 Employee agrees that he shall not at any time, either during or
subsequent to his employment term, unless expressly consented to in writing
by Company, either directly or indirectly use or disclose to any person or
entity any confidential information of any kind, nature or description
concerning any matters affecting or relating to the business of Company,
including, but not limited to, information concerning the customers of
Company, Company's marketing methods, compensation paid to employees,
independent contractors or suppliers
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and other terms of their employment or contractual relationships, financial
and business records, know-how, or any other information concerning the
business of Company, its manner of operations, or other data of any kind,
nature or description. Employee agrees that the above information and items
are important, material and confidential trade secrets and these affect the
successful conduct of Company's business and its goodwill. This
non-disclosure obligation does not apply to any information which is
presently in the public domain, or any information that subsequently becomes
part of the public domain through no fault of Employee.
2.3 Employee will not, during his employment with the Company, engage
in any business, enterprise or activity that is contrary to or detracts from
the business of the Company or the proper fulfilment of his duties and
responsibilities to the Company.
2.4 Employee will comply with all the restrictions set forth below at
all times during his employment and for a period of eighteen months after the
termination of his employment:
a. Employee will not, either individually or in conjunction
with any person, as principal, agent, director, officer, employee, investor
or in any other manner whatsoever, directly or indirectly engage in or become
financially interested in any competitive business within North America,
except as a passive investor holding not more than one percent of the
publicly traded stock of a corporation in which Employee is not involved in
management;
b. Employee will not, either directly or indirectly, on its
own behalf of on behalf of others, solicit, divert or appropriate or attempt
to solicit, divert or appropriate to any competitive business, any business
or actively sought prospective business of the Company or any customers with
whom the Company or any affiliate of the Company has current agreements
relating to the business of the Company, or with whom Employee has dealt, or
with whom Employee has supervised negotiations or business relations, or
about whom Employee has acquired confidential information in the course of
Employee's employment;
c. Employee will not, either directly or indirectly, on
Employee's behalf or on behalf of others, solicit, divert or hire away, or
attempt to solicit, divert, or hire away, any independent contractor or any
person employed by the Company or any affiliate of the Company or persuade or
attempt to persuade any such individual to terminate his or her employment
with the Company; and,
d. Employee will not directly or indirectly impair or seek
to impair the reputation of the Company or any affiliate of the Company, nor
any relationship that the Company or any affiliate of the Company has with
its employees, customers, suppliers, agents or other parties with which the
Company or any other affiliate of the Company does business or has
contractual relations;
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e. Employee will not receive or accept for its own benefit,
either directly or indirectly, any commission, rebate, discount, gratuity or
profit from any person having or proposing to have one or more business
transactions with the Company or any affiliate of the Company, without the
prior approval of the Board, which may be withheld; and,
f. Employee will, during the term of this employment with
the Company, communicate and channel to the Company all knowledge, business
and customer contacts and any other information that could concern or be in
any way beneficial to the business of the Company. Any such information
communicated to the Company as aforesaid will be and remain the property of
the Company notwithstanding any subsequent termination of Employee's
employment.
3. COMPENSATION.
3.1 Subject to the termination of this Agreement as provided herein,
Company shall compensate Employee for his services hereunder at an annual
salary set forth in SCHEDULE A, subject to changes by mutual agreement,
payable in accordance with the Company's standard salary payment schedule.
Payment of Employee's Salary will be subject to income tax source deductions
and other deductions required by applicable laws.
3.2 Employee is also eligible to receive such additional compensation
as the Board of Directors of Company determines is proper in recognition of
Employee's contributions and services to Company. Such additional
compensation shall be paid to Employee on the anniversary date of this
Agreement during the Employment Term, and at such other times as may be
determined by the Board of Directors.
3.3 Employee shall be entitled to stock options each year of employment
for the term of his employment as set forth in summary in Schedule A. The
details of the stock options are set forth in the Company's Employee Stock
Option Plan.
3.4 In addition to the compensation set forth above, Employee shall be
entitled to participate in or to receive benefits under all of Company's
employee benefit plans made available by Company now or in the future to
similarly situated employees, subject to the terms, conditions and overall
administration of such plans.
(a) Employee shall be entitled to participate in or to
receive benefits under all of Company's employee benefit plans made available
by Company or in the future to similarly situated employees, subject to the
terms, conditions and overall administration of such plans. Including but not
limited to 401(k) plans, XXX plans, E.R.I.S.A Plans, any other retirement or
benefit plans that the Company has made available to similarly situated
employees.
(b) Upon receipt of the bills or other evidence of
expenses, Company shall reimburse Employee for all medical, dental and
hospital expenses incurred by Employee for
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himself and for his dependant(s), if any, pursuant to the medical care plan
adopted by the Company.
4. EXPENSES. Company shall reimburse Employee for all reasonable business
related expenses incurred by Employee in the course of his normal duties on
behalf of the Company. In compensating Employee for expenses, the ordinary
and usual business guidelines and documentation requirements shall be adhered
to by Company and Employee.
(a) Employee will be required to incur travel, meals, entertainment and
other business expenses on behalf of the Company in the performance of
Employee's duties hereunder. Company will reimburse Employee for all such
reasonable business expenses incurred by Employee in connection with
Company's business upon presentation of receipts or other acceptable
documentation of the expenditures.
5. VACATION. Employee shall be entitled to the period of vacation set
forth on SCHEDULE A to this Agreement. Vacation should be taken at such times
as may be convenient to Company and Employee. Any vacation time not used in
any one year may be carried forward to subsequent employment years. For
purposes of this Agreement, "employment years" shall mean the successive one
(1) year periods beginning on the Effective Date of this Agreement and on
each anniversary date of the Effective Date of this Agreement during the term
of this Agreement.
6. ASSIGNMENT OF INTELLECTUAL PROPERTY RIGHTS. As consideration for your
employment with Company, Employee covenants and agrees as follows:
(a) Employee will make prompt and full disclosure to the Company of any
discovery, processes, inventions, patents, computer software, copyrights,
trademarks and other intangible rights (collectively referred to as
"Intellectual Property") that may be conceived, made, improved upon,
developed, or participated by Employee, solely or jointly, in the course of,
arising from or relating to any Intellectual Property Rights of the Company,
or his employment with the Company or any affiliate of the Company (the "Work
Products").
(b) The Company will hold all Intellectual Property Rights in respect
of the Work Products for the exclusive benefit of the Company and Employee
agrees not to claim or apply for registration or challenge the Company's
registration of, any such Intellectual Property Rights. Employee's acceptance
of the terms of this Agreement constitutes an absolute, unconditional and
irrevocable assignment, transfer and conveyance of all past, present and
future right, title, benefit and interest in and to all Intellectual Property
Rights in respect of the Work Products. Employee hereby waives, in favor of
the Company, all claims of any nature whatsoever that Employee now or
hereafter may have for infringement of any Intellectual Property Rights for
the Work Products so assigned to the Company. To the extent that copyright
may subsist in the Work Products, Employee hereby waives all past, present
and future moral rights he may have.
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(c) The Work Products and all related Intellectual Property Rights will
be the absolute and exclusive property of the Company. The Company may apply
for patent, copyright or other intellectual property protection in the
Company's name or, where such procedure is proper, in Employee's name,
anywhere in the world. Employee will, at the Company's request, execute all
documents and do all such acts and things considered necessary by the Company
to obtain, confirm or enforce any Intellectual Property Rights in respect of
the Inventions. In case the Company requires, but is unable to secure
Employee's signature for any such purpose in a timely manner, Employee hereby
irrevocably designate and appoint the Company and any duly authorized officer
or agent of the Company as Employee's agent and attorney, to act for Employee
and in Employee's behalf an stead to execute any such documents and to do all
other lawfully permitted acts to carry out the intent of this provision, with
the same legal force and effect as if executed or done by Employee. This
power of attorney is coupled with an interest.
7. DISABILITY OF EMPLOYEE.
7.1 Employee shall be considered disabled if, due to illness or injury,
either physical or mental, Employee is unable to perform Employee's customary
duties as an employee of Company for more than thirty (30) days in the
aggregate out of a period of twelve (12) consecutive months. The disability
shall be determined by a certification from a physician.
7.2 If Employee is determined to be disabled, Company shall continue to
pay Employee's base salary for the initial ninety (90) days of "disability."
The continuation of the salary compensation after the initial ninety (90)
days shall be determined by the Board of Directors of the Company.
8. TERMINATION BY COMPANY.
8.1 Unless terminated earlier as provided in this Agreement, Employee
shall be employed for a term set forth in SCHEDULE A. Thereafter, the
employment term shall continue on an at will basis until terminated at the
option of Company or Employee upon thirty (30) days prior written notice.
This Agreement may be terminated at any time by written agreement between the
parties, or as provided in Section 8.2 below. This Agreement will terminate
immediately upon Employee's death.
8.2 Company may terminate this Agreement for cause at any time without
notice. For purposes of this Agreement, the term "cause" shall include, but
not be limited to, the following: a material breach of or failure to perform
any covenant or obligation in this Agreement, disloyalty, dishonesty, neglect
of duties, unprofessional conduct, acts of moral turpitude, disappearance,
felonious conduct or fraud, the use of illegal drugs or the habitual and
disabling use of alcohol and drugs, embezzlement or similar conduct.
9. NOTICE. Any notice, request, demand, or other communication given
pursuant to the terms of this Agreement shall be deemed given upon delivery,
if hand delivered, or
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forty-eight (48) hours after deposit in the United States mail, postage
prepaid, and sent certified or registered mail, return receipt requested,
correctly addressed to the addresses of the parties indicated below or at
such other address as such party shall in writing have advised the other
party.
If to Company: Mirage Holdings, Inc.
000 Xxxxxxxx Xxxx., Xxxxx 000
Xxxxx Xxxxxx, XX 00000
Attn.: Xxxxxx Xxxxxx, President
Copy to: Xxxxxxx & Xxxx
Xxx Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxx, XX 00000
Attn.: Xxxxxxxx X. Xxxxxxx, Esq.
If to Employee: ________________________
________________________
________________________
Copy to: ________________________
________________________
________________________
10. BINDING EFFECT. This Agreement shall be binding upon and inure to the
benefit of the parties hereto their respective devisees, legatees, heirs,
legal representatives, successors, and permitted assigns. The preceding
sentence shall not affect any restriction on assignment set forth elsewhere
in this Agreement.
11. ARBITRATION. If a dispute or claim shall arise with respect to any of
the terms or provisions of this Agreement, or with respect to the performance
by either of the parties under this Agreement, other than a dispute with
respect to Section 2 of this Agreement, then either party may, with notice as
herein provided, require that the dispute be submitted under the Commercial
Arbitration Rules of the American Arbitration Association ("AAA"). Each party
shall bear one-half (1/2) of the cost of appointing the arbitrator and of
paying such arbitrator's fees. The written decision of the arbitrator(s)
ultimately appointed by or for both parties shall be binding and conclusive
on the parties. Judgment may be entered on such written decision of the
single arbitrator in any court having jurisdiction. Any arbitration
undertaken pursuant to the terms of this section shall occur in the county of
the Company's office in Los Angeles, California.
12. ASSIGNMENT. Subject to all other provisions of this Agreement, any
attempt to assign or transfer this Agreement or any of the rights conferred
hereby, by judicial process or
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otherwise, to any person, firm, Company, or corporation without the prior
written consent of the other party, shall be invalid, and may, at the option
of such other party, result in an incurable event of default resulting in
termination of this Agreement and all rights hereby conferred.
13. CHOICE OF LAW. This Agreement and the rights of the parties hereunder
shall be governed by and construed in accordance with the laws of the State
of California including all matters of construction, validity, performance,
and enforcement and without giving effect to the principles of conflict of
laws.
14. INDEMNIFICATION. Company shall indemnify, defend and hold Employee
harmless, to the fullest extent permitted by law, for all claims, demands,
losses, costs, expenses, obligations, liabilities, damages, recoveries and
deficiencies, including interest, penalties and reasonable attorney's fees
that Employee shall incur or suffer that arise from, result from or relate to
the discharge of Employee's duties under this Agreement.
15. ENTIRE AGREEMENT. Except as provided herein, this Agreement, including
exhibits, contains the entire agreement of the parties, and supersedes all
existing negotiations, representations, or agreements and all other oral,
written, or other communications between them concerning the subject matter
of this Agreement. There are no representations, agreements, arrangements, or
understandings, oral or written, between and among the parties hereto
relating to the subject matter of this Agreement that are not fully expressed
herein.
16. SEVERABILITY. If any provision of this Agreement is unenforceable,
invalid, or violates applicable law, such provision, or unenforceable portion
of such provision, shall be deemed stricken and shall not affect the
enforceability of any other provisions of this Agreement.
17. CAPTIONS. The captions in this Agreement are inserted only as a matter
of convenience and for reference and shall not be deemed to define, limit,
enlarge, or describe the scope of this Agreement or the relationship of the
parties, and shall not affect this Agreement or the construction of any
provisions herein.
18. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
shall together constitute one and the same instrument. 19. MODIFICATION. No
change, modification, addition, or amendment to this Agreement shall be valid
unless in writing and signed by all parties hereto.
20. ATTORNEYS' FEES. Except as otherwise provided herein, if a dispute
should arise between the parties including, but not limited to arbitration,
the prevailing party shall be reimbursed by the non-prevailing party for all
reasonable expenses incurred in resolving such dispute, including reasonable
attorneys' fees exclusive of such amount of attorneys' fees as shall be a
premium for result or for risk of loss under a contingency fee arrangement.
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21. TAXES. Any income taxes required to be paid in connection with the
payments due hereunder, shall be borne by the party required to make such
payment. Any withholding taxes in the nature of a tax on income shall be
deducted from payments due, and the party required to withhold such tax shall
furnish to the party receiving such payment all documentation necessary to
prove the proper amount to withhold of such taxes and to prove payment to the
tax authority of such required withholding.
22. NOT FOR THE BENEFIT OF CREDITORS OR THIRD PARTIES. The provisions of
this Agreement are intended only for the regulation of relations among the
parties. This Agreement is not intended for the benefit of creditors of the
parties or other third parties and no rights are granted to creditors of the
parties or other third parties under this Agreement. Under no circumstances
shall any third party, who is a minor, be deemed to have accepted, adopted,
or acted in reliance upon this Agreement.
23. FACSIMILE SIGNATURES. Facsimile signatures shall be acceptable and
binding as originals.
24. CONFLICT WAIVER. Both Employee and the Company (the "Parties") hereby
agree and acknowledge that the law firm of Xxxxxxx and Beam ("H&B"), which
represents the Company, has drafted this Agreement. The Parties hereto
further acknowledge that they have been informed of the inherent conflict of
interest associated with the drafting of this Agreement by H&B and waive any
action they may have against H&B regarding such conflict. The Parties have
been given the opportunity to consult with counsel of their choice regarding
their rights under this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the Effective Date.
"Company" "Employee"
Mirage Holdings, Inc., Xxxxxx Xxxxxx
a Nevada corporation
/s/Xxxxxx Xxxxxx /s/Xxxxxx Xxxxxx
---------------------- -------------------
BY: Xxxxxx X. Xxxxxx
ITS: President
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SCHEDULE A
EMPLOYEE'S NAME: Xxxxxx Xxxxxx
EFFECTIVE DATE AND TERM: Effective date of Employment shall be as of April 17,
1999 for a period of three years from the effective date.
POSITION: Chief Executive Officer, President and
interim Chief Financial Officer
SALARY: $100,000 per year.
STOCK OPTION:
Specific terms as detailed in the Employee Stock Option Plan with general terms
as follows:
(a) On May 18, 1999, Employee shall be issued 150,000 shares of common
stock of the Company with Rule 144 restriction at an exercise price of
$1.50 per share;
(b) On May 18, 2000, Employee shall be issued 150,000 shares of common
stock of the Company with Rule 144 restriction at an exercise price of
$2.50 per share;
(c) On May 18, 2001, Employee shall be issued 150,000 shares of common
stock of the Company with Rule 144 restriction at an exercise price of
$3.50 per share;
PAID VACATION: Two weeks paid vacation.
"Company" "Employee"
Mirage Holdings, Inc., Xxxxxx Xxxxxx
a Nevada corporation
/s/Xxxxxx Xxxxxx /s/Xxxxxx Xxxxxx
----------------------- ---------------------
BY: Xxxxxx X. Xxxxxx
ITS: President
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