EMPLOYMENT AGREEMENT
THIS
EMPLOYMENT AGREEMENT (this "Agreement") is made as of January ___, 2009, by and between
My Screen Mobile, Inc., a Delaware corporation ("Company"), and Xxxxxxxx
Xxxxxxxx, an individual ("Employee").
RECITALS
A. Company
is engaged in the business of developing and commercializing, on a global basis,
technology that provides direct incentive-based advertising to mobile telephone
users (the "Business"), and is seeking a Chief Executive
Officer with experience in the global telecommunications industry.
B. Employee
has experience in the telecommunications business on a global
basis.
C. The
parties are willing to enter into this Agreement with respect to Employee's
employment
and services upon the terms and conditions hereinafter set forth.
AGREEMENT
In
consideration of the foregoing recitals and the premises herein contained, the
parties agree as follows:
I.
TERM
Subject
to the provisions of Article V hereof, Company hereby employs Employee and
Employee hereby accepts employment with Company for a period of three (3) years
(the "Initial
Term").
The Initial Term shall commence on the date on which Employee's
employment with his current employer terminates, which date shall be confirmed
in writing by written letter from Employee to the Company (the "Commencement
Date"); provided, however, if the Initial Term has not commenced within
100 days from the "Approval Date" (as hereinafter defined), then this Agreement
shall automatically terminate and neither party shall have any liability to the
other party hereunder, except Employee shall immediately return any portion of
the Signing Bonus paid by Company and reimburse Company for all expenses paid
to, or on behalf of Employee, under Article III, Section 8 of this Agreement
Employee shall use his good faith efforts to relocate to Miami as soon as
possible after the Commencement Date, however, shall complete such relocation no
later than 90 days after the Commencement Date. For purposes of this Agreement,
the term "Approval Date" shall mean the date the Company confirms in writing to
Employee (and provides reasonable documentation evidencing such approval) that
this Agreement, including, without limitation, the grant and issuance of all of
the equity incentive compensation set forth below, has been authorized and
approved in accordance with all requisite corporate action, including the
requisite approval from a majority of the stockholders of the Company, all in
accordance with applicable law and the articles of incorporation, bylaws and all
other documents governing the Company, except for the formal establishment of
the Plans and required filings with the SEC of Information Statements, Proxy
Statements or other such filings required in connection with the Plans or the
equity grants.
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II.
DUTIES
1.
General Duties.
Unless otherwise directed by the Board of Directors of Company (the "Board of Directors"), and
subject to its policies and directives, Employee shall serve as the Chief
Executive Officer of Company, manage the day to day global operations of Company
and perform all duties customarily performed by the chief executive officer of a
US publicly traded company of similar size, market capitalization and in a
similar industry as the Company. Employee shall serve at the direction of the
Board of Directors of Company (the "Board of Directors"), subject
to its policies and directives (provided that the Company hereby represents and
warrants that no written policies or directives exist as
of the date hereof, it being the intention of the parties that Employee, as a
member of the Board of Directors and together with the other members of the
Board of Directors, will help shape and set forth the strategies, policies and
directives for the Company on a going-forward basis). Employee shall work from
the Company's world headquarters, which Company shall establish in Miami,
Florida, to where Employee shall relocate.
2.
Devotion of Time to
Company's Business. Employee agrees during the Term, to devote his best
efforts, and all of his business time exclusively, to his employment with
Company, and to perform such duties as shall be reasonably requested by
the Board of Directors of Company. Employee shall riot, during
Employee's employment, unless otherwise agreed to in advance and in
writing by Company, seek or accept other employment, become self-employed in any
other capacity, or engage in any activities that are detrimental to the business
of Company.
III.
COMPENSATION
AND BENEFITS
As
compensation for Employee's services hereunder, the covenant-not-to-compete
contained in Article VI of this Agreement (the "Covenant-Not-to-Compete"),
and the other
covenants and promises made by Employee
hereunder, Company agrees to the following:
1.
Base Salary. During
the Term, Employee shall receive an annual base
salary of
$350,000.00.
The base salary shall be payable in U.S. Dollars at the times and in the
installments consistent with Company's customary payroll practices. Company
shall withhold federal and state taxes in accordance with applicable
law.
2.
Signing
Bonus. Company shall pay Employee a signing bonus of $300,000 (the "Signing
Bonus"), which Signing Bonus shall be
payable in three equal installments of $100,000 each. The
first installment of the Signing Bonus shall be paid within three (3) calendar
days after both parties have executed this Agreement (the "Effective Date"); the second installment shall be
paid within three (3) calendar days after the Commencement Date; and the third
installment shall be paid within ninety (90) calendar days after the
Commencement Date. If Employee terminates this Agreement, without cause, or
if
Company terminates this Agreement for "Cause" (as hereinafter defined), prior to
the date any installment
of the Signing Bonus
is due under this Section, Company shall not be obligated to pay the
remaining
installments to Employee. In addition, if within one (1) year after the
Commencement Date, Employee terminates this Agreement, without cause, or Company
terminates this Agreement for Cause, Employee agrees to, within thirty (30) days
after such termination, repay Company a pro rata portion of the Signing Bonus
calculated by multiplying: (A) the portion of the Signing Bonus actually paid to
Employee;
times (B) a fraction, the numerator of which is (i) 365 minus the number of days
between the Commencement Date and the date of Employee's termination, and the
denominator of which is (ii) 365. (By way of example, if Employee has received
the entire Signing Bonus and Employee is terminated by the Company for Cause
after having been employed by the Company for 250 days from the Commencement
Date, then the portion of the Signing Bonus to be paid back by Employee
would be $96,000, calculated by reference to the foregoing formula as: $300,000
x ((365-250) / 365) = $96,000).
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3.
Cash Incentive Bonus.
During each twelve (12) month period of the Term, Employee shall be
eligible to receive a cash bonus of up to $350,000 based on the achievement of
milestones to be mutually agreed upon by the Board of Directors and Employee, in
good faith, within thirty (30) days after the commencement of each such twelve
month period. Such milestones shall generally be based on some objective
performance standards such as revenues or profitability of the Company that are
reasonably achievable given the Company's position in the market at the time the
milestones are discussed and agreed upon.
4.
Equity Incentive
Compensation. Company shall provide Employee with the equity incentives
set forth below, subject to one or more employee equity compensation plans ("Plans")
to be established by the Company within thirty (30) days from the
Commencement Date, which Plans shall contain customary terms and provisions as
contained in Plans for similarly situated US publicly traded companies. Within
thirty (30) days after the Commencement Date, (a) such Plans shall be
established, (b) the equity incentives required hereunder shall be granted to
Employee, and (c) the Company shall make any filing with the Securities &
Exchange Commission or other governmental authority, including, but not limited
to, a proxy statement or information statement, required in connection with any
such Plans. In the event such Plans are not established, such equity incentives
are not granted to Employee, or said filings are not made, within said thirty
(30) day period, then Employee may provide written notice to Company of its
failure, in which case, Company shall have 30 days from its receipt of such
written notice, to cure such failure. If such failure is not cured within such
30 day period, Employee may resign from his position with the Company and,
notwithstanding anything contained in this Agreement to the contrary, the
Company shall be responsible to immediately pay to Employee, as agreed upon
liquidated damages, the Employee's annual base salary for the entire Initial
Term, plus the entire Signing Bonus (such a resignation shall not be deemed a
termination by Employee without cause and the provisions for Employee to return
a pro rata portion of the Signing Bonus under Section 2 of this Article shall
not be
applicable.
(a) Stock Grant. Company
shall issue Employee 3,000,000 shares of Company's common
stock, par value $0.001 per share (the "Common Stock")(the grant of all such
shares of Common Stock hereinafter collectively referred to as the "Stock
Grant") upon the Commencement Date, (i) 500,000 of which shall vest six
(6) months after the Commencement Date if Employee is still employed by Company
as of such date; (ii) 500,000 of which shall vest on the last day of the twelfth
month following the Commencement Date, if Employee is still employed by Company
as of such date; (iii) 500,000 of which shall vest on the last day of the
eighteenth month following the Commencement Date if Employee is still employed
by Company as of such date; (iv) 500,000 of which shall vest on the last day of
the twenty-fourth month following the Commencement Date, if Employee is still
employed by Company as of such
date; (v) 500,000 of which shall vest on the last day of the thirtieth month
following the Commencement Date, if Employee is still employed by Company as of
such date; and (vi) 500,000 of which shall vest on the last day of the
thirty-sixth month following the Commencement Date, if Employee is still
employed by Company as of such date. Notwithstanding the foregoing, if Company
terminates Employee without Cause during any part of the Term, the entire Stock
Grant shall automatically vest. For purposes of clarity, all unvested shares
shall be cancelled and/or returned to Company, if Employee's employment is
terminated for Cause before the date such shares vest. Upon the Commencement
Date, Company shall issue six (6) share certificates in the name of Employee,
each certificate representing 500,000 shares of the Company's Common Stock. The
Company shall deliver such certificates to Company's legal counsel, who, subject
to the terms and conditions set forth herein, shall deliver one (1) certificate
to Employee on each of the vesting dates set forth above. If the Company
terminates Employee at any time during the Term without Cause, then legal
counsel shall, and is hereby directed to, immediately deliver to Employee any of
such stock certificates not previously delivered to Employee. Upon the
termination of this Agreement for any other reason, Company's legal counsel
shall cancel any such stock certificates representing shares that have not
vested as of such termination date (provided that a termination as a result of
death or Disability shall be governed by the terms of Article V, Section 4(c)
below).
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(b)
Stock
Option Grant. Upon the Commencement Date, Company shall grant
Employee
options to purchase an aggregate of 7,000,000 shares of Company's Common Stock,
having an exercise price of $1.00 per share (the "Option
Sharer"). The Option Shares shall vest as set forth below, and be granted
pursuant to the terms of an option agreement which shall comply and conform with
the applicable Plans, which shall have customary terms and provisions as
contained in Plans for similarly situated US publicly traded companies. Upon a
termination of Employee's employment hereunder, for any reason, (provided that a
termination as a result of death or Disability shall be governed by the teams of
Article V, Section 4(c) below), all Option Shares vested as of the date of
termination shall remain vested and exercisable by Employee for the time periods
and in accordance with the terms of the Plans, and all unvested Option Shares as
of such date of termination shall terminate. The Option Shares shall vest as
follows:
(i)
750,000 of the Option Shares shall vest six (6) months after the Commencement
Date if Employee is still employed by Company as of such date.
(ii) 750,000
of the Option Shares shall vest on the last day of the twelfth month
following the Commencement Date, if Employee is still employed by Company as of such
date.
(iii) 750,000
of the Option Shares shall vest on the last day of the twenty-fourth
month following the Commencement Date, if Employee is still employed by Company
as of such date.
(iv) 750,000
of the Option Shares shall vest on the last day of the thirty-sixth month
following the Commencement Date, if Employee is still employed by Company as of
such date.
(v) 4,000,000
of the Option Shares shall vest upon the achievement of milestones
as follows:
(A)
1,000,000 Option Shares shall vest upon the Company: (i) launching
its direct, incentive-based marketing and advertising platform for mobile
devices in any country around the world, such that mobile device users in such
country begin receiving (or are eligible to receive upon signing up for the
appropriate service) advertising to their mobile devices through the Company's
advertising platform; and (ii) generating any revenue from such launch in such
country (whether from direct fees, licensing fees, sublicense fees or otherwise,
provided, however, that license fees or sublicense fees received from a
licensing arrangement in existence prior to the Commencement Date shall not be
considered revenue for purposes of meeting this milestone).
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(B) 500,000
Option Shares shall vest upon the Company: (i) launching its direct,
incentive-based marketing and advertising platform for mobile devices in any
second country around the world, such that mobile device users in such country
begin receiving (or are eligible to receive upon signing up for the appropriate
service) advertising to their mobile devices through the Company's advertising
platform; and (ii) generating any "Advertising
Revenue" (as hereinafter defined) from such launch in such second
country. For purposes of this Agreement, "Advertising
Revenue" shall mean My Screen's portion of revenue generated from the
delivery of advertising or marketing to mobile devices through the Company's
mobile advertising platform, but excluding revenue generated through licensing
or sublicensing fees.
(C) 500,000
Option Shares shall vest upon the receipt by the Company of an aggregate of
$1,000,000 of Advertising Revenue.
(D) 500,000
Option Shares shall vest upon the Company: (i) launching its direct,
incentive-based marketing and advertising platform for mobile devices in
partnership with any Orascom-owned mobile operator around the world; and (ii)
generating any Advertising Revenue from such launch in such
country;
(E) 500,000
Option Shares shall vest at the end of the first fiscal quarter during which the
Company has positive Earnings Before Interest, Taxes Depreciation and
Amortization; and
(F) 1,000,000
Option Shares shall vest at the end of the first fiscal year
during which the Company has positive net annual income based on GAAP and
on an audited basis.
(c) Adjustments. The
following adjustments shall apply to any portion of the Stock Grant
that is unvested at the time of the event described below and shall apply to the
Option Shares:
(i) Upon Recapitalization.
If the outstanding shares of Common Stock of the Company are increased or
decreased or changed into or exchanged for a different number or kind of shares
or other securities of the Company by reason of any recapitalization,
reclassification, reorganization, stock split, reverse split, combination of
shares, exchange of shares, stock dividend or other distribution payable in
capital stock of the Company, or other increase or decrease in such shares
effected without receipt of consideration by the Company, an appropriate and
proportionate adjustment shall be made (A) in the number and kind of shares of
Common Stock issuable to Employee as to the invested portion of the Stock Grant;
(B) in the number and kind of shares of Common Stock issuable to Employee upon
exercise of outstanding Option Shares granted to Employee hereunder; and (C) in
the Option Price per share of outstanding Option Shares granted to Employee
hereunder.
(ii) Reorganization. In
connection with a merger, consolidation, reorganization or other business
combination of the Company with one or more other entities in which the Company
is not the surviving entity, each then unvested Stock Grant and each then
outstanding Option Share shall, upon exercise thereafter, entitle the holder
thereof to such number of shares of Common Stock or other securities or property
to which a holder of shares of Common Stock would have been entitled to upon
such merger, consolidation, reorganization or other business
combination.
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(iii) Dissolution or Liquidation.
Upon the dissolution or liquidation of the Company,
Employee shall have the right, immediately prior to the occurrence of such
dissolution or liquidation to exercise all Option Shares, whether or not such
Option Shares were otherwise exercisable at the time such liquidation or
dissolution occurs and without regard to any vesting or other limitation on
exercise imposed under this Agreement. The Company shall give to Employee
reasonable prior written notice before the record date of any such dissolution
or liquidation in order to give Employee a reasonable amount of time to exercise
such Option Shares, should Employee so elect.
(iv) Fractional Shares. No
fractional shares of Common Stock or units of other
securities shall be issued pursuant to any of the adjustments set forth herein,
and any fractions resulting from any such adjustment shall be eliminated in each
case by rounding upward to the nearest whole share or unit. Any adjustment made
pursuant to this Section 4(c) shall become effective retroactive to the record
date, if any, for such event.
5.
Change of
Control.
(a) Subject
to Article V below, upon a "Change of Control" (as defined below):
(i) Except
as set forth below, all unvested Stock Grants and Option Shares granted
pursuant to this Article
III, Section 4, shall automatically vest and be issued (in the case of
the Stock Grants) and become exercisable (in the case of the Option Shares). The
Company shall give to Employee reasonable prior written notice before the record
date of any such Change of Control event in order to give Employee a reasonable
amount of time to exercise such Option Shares; and
(ii) Employee
shall receive the following additional compensation (payable as set
forth below) (the "Change
of Control Bonus") if such
Change of Control results in net proceeds to Company or its stockholders, after
payments of all debts, liabilities and other outstanding obligations of the
Company (as shown in the Company's financial statements as of the date of the
Change of Control event, which financial statements shall be prepared in
accordance with GAAP, consistently applied) ("Net
Proceeds"), of more than
$250,000,000:
(A) One
Percent (1%) of any Net Proceeds between $250,000,000 and
$500,000,000, received by Company or its stockholders;
(B) One
and One-Half Percent (1 1/2%) of any Net Proceeds between $500,000,001
and $750,000,000, received by Company or its stockholders;
(C) Two
Percent (2%)
of any Net Proceeds between $750,000,000 and
$1,000,000,000, received by Company or its stockholders;
(D) Three
Percent (3%) of any Net Proceeds between $1,000,000,001 and
$1,500,000,000, received by Company or its stockholders; and
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(E) Four
Percent (4%) of any Net Proceeds over $1,500,000,001, received
by Company or its stockholders.
(b)
For purposes of this Agreement, "Change of Control" means:
(i) any
transaction in which any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act")), becomes the Beneficial Owner (as defined in Rule
13d-3 of the Exchange 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
(ii) any
merger, consolidation or other business combination or reorganization
in which the stockholders of the Company immediately prior to such
consolidation, merger or other business combination or reorganization own less
than 50% of the surviving or resulting entity's voting power immediately after
the transaction.
(iii) the
sale, transfer, or other disposition of all or substantially all of Company's
assets.
Notwithstanding
the foregoing, for purposes of Section 5(a)(i), any securities acquired by a
Current Owner (as defined below), shall not be included within the calculation
of the number of securities of which such Current Owner is or becomes the
Beneficial Owner, directly or indirectly under Section 5(b)(i), if such
securities are acquired by such Current Owner from persons that are stockholders
of the Company as of the date hereof, or the assignees of such persons, unless
such Current Owner becomes the Beneficial Owner of securities of the Company
representing 70% or more of the combined voting power of the Company's
then-outstanding securities. In order to be excluded in the calculation of the
number of securities of which such Current Owner is or becomes the Beneficial
Owner, directly or indirectly under Section 5(b)(i), a Current Owner must use
its own funds entirely to acquire securities from other stockholders of the
Company, it being agreed and acknowledged that if a Current Owner uses funds
from a third party or in concert with other parties (even if a portion of the
funds are from the Current Owner), to acquire securities from other stockholders
of the Company, then such securities shall be included within such calculation.
A "Current Owner" shall
mean any person that, as of the date hereof, is the Beneficial Owner, directly
or indirectly, of more than ten percent (10%) of the Company's combined voting
power, or such person's assignee(s), excluding, Orascom Telecom Holdings,
S.A.E.
A
transaction shall not constitute a Change of Control if its sole purpose is to
change the state of Company's incorporation or to create a holding company that
will be owned in substantially the same proportions by the persons who held
Company's securities immediately before such transaction. In addition, the
provisions of this Section 5 shall only apply to the first Change of Control,
and shall not apply to arty subsequent Change of Control.
6.
Benefits
Plans. Company shall provide Employee and his immediate family with
medical benefits commensurate with the medical benefits provided to Employee by
his current employer, Nokia.
7.
Other
Benefit Plans. Employee will be eligible to participate in such
disability insurance plans, life insurance plans, retirement plans and other
employee welfare and benefit plans or programs which may in the future be made
available to Company's senior-level U.S. executives.
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8.
Expenses.
Employee shall be entitled to receive reimbursement, effective from the
date of signing this Agreement, for all reasonable out-of-pocket travel and
other expenses (excluding ordinary commuting expenses) incurred by Employee in
performing Employee's services hereunder, provided that such expenditure is of a
nature qualifying it as a proper business expenditure of Company; and Employee
furnishes to Company adequate documentary evidence for the substantiation of
such expenditures and Employee otherwise complies with Company policies with
respect to expense reimbursement. In addition, Company shall pay all reasonable
expenses incurred by Employee in connection with the relocation of Employee and
Employee's immediately family from Madrid, Spain to Miami, Florida, which
expenses shall be mutually agreed upon in advance, but which expenses shall
specifically include any expenses incurred by Employee in terminating any lease
for his primary residence that Employee currently has in Madrid and any expenses
Employee incurs in connection with Employee's children leaving their current
school in Madrid prior to the end of the current school year. In addition, the
Company shall post a bond for the benefit of Employee in the amount of
$25,000.00 for the purpose of paying Employee's moving expenses to relocate from
Florida to any other part of the world, payable to Employee if and only to the
extent Employee is terminated by the Company without Cause, or, within twelve
(12) months from the Commencement Date, the Company ceases its business
operations or otherwise changes its core business so substantially such that the
skills and expertise of Employee are no longer required in connection with such
changed business (each of such events hereinafter referred to as a "Trigger
Event"). In the event a Trigger Event occurs and Employee does not
relocate from Florida within one-hundred-eighty (180) days - from the date of
such Trigger Event, then the bond shall terminate.
9.
Automobile,
telephone and housing allowance.
Company shall reimburse Employee or otherwise provide Employee an
automobile allowance in the amount of One Thousand Five Hundred and No/100
Dollars ($1,500.00) per month and a reimbursement for all reasonable insurance,
fuel, maintenance, cellular and mobile telephones, repairs and upkeep therefor.
Company shall provide Employee with a housing allowance of $3,500 per month for
the first 12 months after Employee's relocation to Miami, Florida, and at the
end of such 12 month period the Company's Board shall review the housing
allowance and the amount thereof.
10. Directors'
and Officers' Insurance. Company shall use its best efforts to secure, on
or before the Commencement Date, a directors' and officers' insurance policy
(the "Policy") in sufficient amounts to
insure against the personal liability of the Employee as an officer and/or
director of the Company for certain losses resulting from claims brought against
directors and officers because of their alleged wrongful acts. Company's failure
to secure the Policy prior to the Commencement Date shall not constitute a
breach of this Agreement, as long as Company continues to diligently proceed
with securing such Policy.
11. Vacation. The Employee shall be entitled
to a six (6) week vacation each calendar year during the Term.
12. Board
Seat It is the intent of the parties that Employee shall be a member of
the Board of Directors
of the Company during the entire Term of his employment with Company. In this
regard, within thirty (30) days following the Commencement Date, the Company
shall use its best efforts to cause a majority of its stockholders to enter into
a voting agreement or other agreement pursuant to which such majority
stockholders agree and consent to vote their respective shares for the purposes
of electing and appointing Employee to the Board of Directors for so long as
Employee remains employed by the Company. In the event, the foregoing agreement
by the majority stockholders is not fully executed and binding within thirty
(30) days from the Commencement Date, then Employee may resign from his position
with the Company, whereupon the parties shall be released of all liability or
obligation, each to the other, under this Agreement, except that,
notwithstanding anything contained in this Agreement to the contrary, the
Company shall be responsible to immediately pay to Employee, as agreed upon
liquidated damages, the Employee's annual base salary for the entire Initial
Term, plus the entire Signing Bonus (such a resignation shall not be deemed a
termination by Employee without cause and the provisions for Employee to return
a pro rata portion of the Signing Bonus under Section 2 of this Article III
shall not be applicable).
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IV.
REPRESENTATIONS
AND WARRANTIES
1.
Representations and Warranties of Company.
Company hereby represents and warrants to Employee, that Company's
authorized capital stock currently consists of 200,000,000 shares of Common
Stock and 3,000,000 shares of preferred stock. As of December 15, 2008, there
were approximately 133,695,637 shares of Common Stock issued and outstanding,
and no shares of preferred stock issued and outstanding. As of December 15,
2008, there were warrants outstanding to purchase approximately 24,890,697
shares of Common Stock, 20,000,000 of which have an exercise price of $2.00 per
share, and 4,890,697 of which are exercisable for $1.00 per share. As of
December 15, 2008, there were options outstanding to purchase 6,250,000 shares
of Common Stock, all of which have an exercise price of $1.00 per share. The
Company further represents and warrants to Employee that within five (5) days
after the date of this Agreement, this Agreement, including, without limitation,
the grant and issuance of all of the equity incentive compensation set forth
above, shall have been authorized and approved in accordance with all requisite
corporate action, including the requisite approval from a majority of the
stockholders of the Company, all in accordance with applicable law and the
articles of incorporation, bylaws and all other documents governing the Company
and its right and authority to undertake any actions; except for the formal
establishment of the Plans and required filings with the SEC of Information
Statements, Proxy Statements or other such filings required in connection with
the Plans or the equity grants. The Company represents and warrants to Employee
that when shares of Common Stock are issued to Employee pursuant to the Stock
Grants Grant or exercise of the Option Shares, such shares shall be validly
issued, fully paid (subject to payment for the Options Shares) and
non-assessable shares of Company Common Stock, and Employee will have good and
valid title to such Company Common Stock, free of all liens and encumbrances.
Company covenants and agrees with Employee that it shall at all times during the
Term, reserve for issuance the shares of Common Stock issuable as part of the
Stock Grant and the exercise of the Option Shares.
2.
Representations and
Warranties of Employee. Employee hereby represents and warrants to
Company, and agrees, that Employee has a visa or such other documentation
required for Employee to legally work in the United States. Employee also
represents and warrants that Employee shall not disclose to Company or otherwise
use in the course of performing his services for Company, any trade secrets or
other confidential information obtained from any of Employee's prior employers
or other
third parties, which Employee is restricted from disclosing or using. To
the best of Employee's knowledge, he is not presently involved in mobile
advertising at Nokia, his present employer. Employee further represents and
warrants to Company that Employee was subject to a non-compete covenant with his
prior employer, Nokia, a true and correct copy of which has been previously
provided to the Company by Employee. If Employee's prior employer, Nokia, files
any action or claim or makes any threats against
Employee based on
Employee's alleged violation of any non-compete covenant, Company
agrees to pay all
reasonable legal fees Employee incurs during the Term defending any such
suit, claim or threat, including, without limitation, all attorneys fees,
paralegals' fees and court costs and expenses through all negotiations, trials
and appeals.
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V.
TERMINATION
Except as
otherwise set forth in this Article V, upon termination of Employee's employment
hereunder, Employee shall not be entitled to any severance payments or severance
benefits from Company or any payments from Company on account of any claim for
wrongful termination, including, but not limited to, claims under any federal,
state or local human and civil rights or labor laws, except
for any benefits which may be due to Employee in the normal course under
any employee benefit plan or program of
Company which provides for benefits after termination of employment.
Employee's right to receive any severance payments or benefits under this
Agreement upon termination of employment will cease if Employee breaches any
provision of Articles VI or VII of this Agreement.
1. Termination By Company For
Cause. The Company shall have the right to terminate the
employment of Employee for "Cause" immediately upon written notice to Employee.
For purposes of this Agreement, "Cause" shall mean the occurrence of any of the
following:
(a)
Employee's failure to perform his material
duties under this Agreement, which failure is not remedied or corrected within thirty (30) days following written notice
from the Company, which written notice shall specify the material duties the
Company believes Employee has failed to perform and the actions deemed necessary
by the Company for Employee to cure such failure;
(b)
Conduct on the part of Employee which constitutes a
breach of any statutory or common
law duty of loyalty to Company;
(c)
Employee's commission of any illegal act
which materially and adversely affects the business of Company or any of
its affiliates or which involves acts of theft, fraud, misappropriation of
funds, embezzlement, moral turpitude or similar conduct;
(d)
Any violation by Employee of the terms of Articles VI
or VII of this Agreement; or
(e)
Employee's failure to relocate to Miami within 90 days after
the Commencement Date,
unless otherwise agreed to in writing by My Screen.
2.
By
Company or Employee Without Cause. Either party may terminate this Agreement
and Employee's employment hereunder without cause, upon thirty (30) days
prior written notice to the other party.
3.
Upon
Death or Disability. Employee's employment hereunder shall terminate upon
Employee's
death or Disability (as hereinafter defined). For purposes of this Agreement,
Disability shall mean the Employee's inability or failure, as a result of an
incapacitating physical or mental condition, to perform Employee's duties as
required herein for a period of at least ninety (90) consecutive days. If there
is any dispute as to whether Employee suffered a Disability, Employee shall
submit to examination by a physician designated by Company and reasonably
acceptable to Employee (or his spouse or other legal guardian).
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4.
Effect of Termination.
(a)
Termination by Company. For
Cause or by Employee without cause. If Employee's employment hereunder is
terminated by the Company for Cause, or by Employee without cause, Employee
shall not be entitled to any severance payments or severance benefits from
Company, except for any benefits which may be due to Employee in the normal
course under any employee benefit plan or program of Company which provides for
benefits after termination of employment.
(b)
Termination Without Cause.
If Company terminates this Agreement and Employee's employment hereunder
without Cause, then Company shall continue to pay to Employee his base salary
and provide all benefits under this Agreement (or in lieu of such benefits, pay
Employee an equivalent dollar amount) for the greater of (i) the remaining Term
under this Agreement, or (ii) twelve (12) months following Employee's last day
of employment. Employee's right to receive any severance payments or benefits
under this Agreement upon termination of employment will cease if Employee
breaches any provision of Articles VI or VII of this Agreement.
(c)
Death or Disability.
In the event Employee's employment is terminated as a result of
Employee's death or Disability during the Term, Company shall pay to Employee's
estate or Employee, as applicable, an amount equal to his then current annual
base salary, which amount may be paid, at the Company's option, in a lump sum or
in equal installments in accordance with the Company's then standard payroll
practices. In addition, Employee or Employee's immediate family shall be
entitled to receive the same medical/health care coverage benefits, at Company's
sole expense, received immediately prior to termination of this Agreement for a
period of twelve (12) months following the termination of Employee's employment
as a result of his death or Disability. In the event the Employee's death or
Disability occurs prior to a date that is twenty-four (24) months from the
Commencement Date, then any unvested portion of the Stock Grant or the Option
Shares shall terminate. In the event the Employee's death or Disability occurs
on a date that is twenty-four (24) months from the Commencement Date or any time
thereafter, then any unvested portion of the Stock Grant or the Option Shares
shall immediately vest. In addition, Employee, his estate or his surviving
heirs, as applicable, shall be entitled to receive any other unpaid amounts
(including, without limitation, vested equity incentives) earned by Employee
through the date of termination of his employment as a result of his death or
Disability.
For
purposes of clarity, upon termination of this Agreement, Company shall be
obligated to pay Employee all compensation and other amounts due under this
Agreement prior to the date of such termination, relocation expenses pursuant to
Article III, Section 8, if applicable, all compensation and other benefits to
which Company is obligated to pay Employee under this Article V, Section 4, and
any other compensation which is specified in this Agreement to be due upon or in
connection with a termination, and Company shall have no obligation to pay any
other compensation to Employee.
VI.
COVENANT
NOT-TO-COMPETE
For good
and valuable consideration as set forth in Article III of this Agreement,
Employee agrees to the following:
1.
General
Covenant. During the
"Restricted Period" (as defined below), Employee agrees that he
shall not, anywhere within the world (the "Territory"), engage or participate in
the ownership, management, operation or control of, or be connected as an officer, employee, partner,
director, agent, security holder, consultant or otherwise with, or aid or assist
any other person or entity, in the conduct or operation of, any business
involving direct advertising or marketing to mobile telephones, smart telephones
or other handheld devices. For purposes of this Agreement, the term "Restricted Period" shall mean the period commencing on
the date of this Agreement and ending twenty-four (24) months after the
termination of Employee's employment under this Agreement; provided, however, if
the Employee is terminated by Company without Cause, then the Restricted Period
shall end eighteen (18) months after the termination of Employee's employment
under this Agreement. This Section 1 shall not apply if the Company does not pay
any amounts to which Employee is due hereunder upon
termination.
11
2.
Interpretation.
The covenants contained in this Covenant-Not-to-Compete shall be
construed to be a series of separate covenants, one for each geographical
location specified. Except for geographical coverage, each such separate
covenant shall be deemed identical to the terms contained herein. If a court of
competent jurisdiction deems any term, provision or geographical location of any
covenant or provision contained this Covenant-Not-to-Compete, or in this
Agreement to be invalid, illegal or unenforceable for any reason, the court may
reduce or eliminate such term, provision or geographical location to conform to
applicable law so as to be valid and enforceable, or, if it cannot be so reduced
or eliminated without materially altering the intention of the parties, the
invalidity or unenforceability of such term or provision shall in no way affect
(to the maximum extent permissible by law) the validity or enforceability of any
other term, provision or geographical location of this Agreement, or the
validity or enforceability of the remaining separate covenants.
3.
Limitation. Nothing
in this Article shall prevent Employee from holding or acquiring common stock or
other securities in any company which is publicly traded on any internationally
recognized stock exchange or on the National Market System of The NASDAQ Stock
Market, provided that such holdings are less than five percent (5%) of the
outstanding capital stock of such publicly-traded company.
4. Agreement Not to Solicit.
To ensure the protection of the trade secrets of Company and its
"Affiliates" (as defined below) and to preserve the goodwill of Company and its
Affiliates for the benefit of Company and its shareholders, Employee agrees to
not, and will cause each of his Affiliates to not, at any time during his
employment with Company and for a period of twenty-four (24) months after the
termination of his employment with Company; provided, however, if the Employee
is terminated without Cause, then such period shall be reduced to eighteen (18)
months after the termination of Employee's employment under this
Agreement:
(a)
Attempt in any manner to persuade any customer or partner of Company or
any of Company's Affiliates, or any other third party doing business with
Company or any of its Affiliates, to cease to do business with, or to reduce the
amount of business which such customer, partner, or other third party has
customarily done or contemplates doing, with Company or its Affiliates;
or
(b)
Solicit for employment or consulting
services or employ or engage any person who is an employee or consultant of
Company or any of Company's Affiliates.
For
purposes of this Agreement, "Affiliate(s)" means any corporation, company,
partnership, joint venture, firm and/or other entity which controls, is
controlled by or is under common control with the person with respect to which
the term "Affiliate" is used. For purposes of this Agreement, "person" means an
individual, corporation, partnership, limited liability company, trust or
unincorporated organization, or a government or any agency or political
subdivision thereof.
12
5. Consideration; Reasonable
Scope. Employee acknowledges and agrees that this Covenant Not-to-Compete
and the compensation provided hereunder constitute good, valid and binding
consideration for Employee's obligations and covenants contained in this
Covenant Not-to-Compete. Employee acknowledges and agrees that the agreements
and covenants of Employee contained in this Covenant Not-to-Compete are
reasonable as to scope and time and necessary to
protect the legitimate interests of Company and its Affiliates, and that any
violation of such provisions would result in irreparable harm to Company.
Accordingly, Employee consents and agrees that in the event of any violation of
such provisions by Employee, Company shall be entitled to, in addition to such
other rights or remedies as Company may have at law, injunctive
and other equitable relief. Furthermore, none of Company's remedies at law or in
equity shall be exclusive of any other remedy available to Company.
VII.
OTHER
RESTRICTIVE COVENANTS
1. Confidential and Proprietary
Information. As an employee of Company, Employee shall have
access to certain "Confidential and Proprietary Information" (as defined below)
concerning Company and its Affiliates. Employee agrees that he will not, either
directly or indirectly, disclose to any person or use any of the Confidential
and Proprietary Information in any way during the Term (except as required in
the course of the performance of his duties to Company) or after the expiration
of the Term.
For
purposes of this Agreement, "Confidential and Proprietary
Information" means any of the following information relating to the
business of Company that is not generally known to competitors, suppliers and
customers of Company: (i) any business or technical information, design,
process, procedure, formula, improvement, or any portion or phase thereof, that
is owned by or has, at the time of determination, been used by Company; (ii) any
information related to the development of products and production processes;
(iii) any information concerning proposed new processes; (iv) any information
concerning customer lists and other customer information, vendor lists and
information, price data, cost data, profit plans, capital plans and proposed or
existing marketing techniques or plans; and (v) any other information which
would constitute a trade secret.
The term
"Confidential and Proprietary
Information" shall not include any information that: (i) was
in Employee's possession prior to the Effective Date and without restriction as
to confidentiality; (ii) is
generally available to the public or becomes generally available to the public
through no breach of agreement or other wrongful act by Employee; (iii) Employee
receives from a third party without restriction on disclosure and without breach
of agreement by Employee; or (iv) is independently developed by Employee without
regard to the Confidential and Proprietary Information. In addition, Employee
may disclose Confidential and Proprietary Information without in any manner
violating this Agreement as required to comply with binding orders of
governmental entities or authorities.
2.
Inventions
and Improvements. Employee agrees that he will assign to Company, without
further consideration, the exclusive rights and title to all inventions,
discoveries, ideas, improvements, and other intellectual property made or
acquired by Employee during the Term, whether alone or jointly with others.
Employee further agrees to execute any and all documents that are reasonably
required in order to transfer or assign such property rights to
Company.
13
VIII.
MISCELLANEOUS
1.
Severability. Every
provision of this Agreement is intended to be severable. If any term or
provision hereof is declared by a court of competent jurisdiction to be illegal
or invalid, such illegal or invalid term or provision shall not affect the
balance of the terms and provisions hereof, which terms and provisions shall
remain binding and enforceable.
2.
Notice. Any notice or
communication required to be given hereunder may be delivered by hand,
deposited with an overnight courier, sent by confirmed facsimile, or mailed by
registered or certified mail, if to Company, to its Board of Directors and Chief
Financial Officer, at the Company's corporate headquarters, and if to Employee,
to his office, or to such other address or fax number as Employee shall provide
in writing to the Chief Financial Officer and Board of Directors of the Company.
Notice shall be deemed received on the date sent if sent by facsimile or
personal delivery; three days after the date sent if sent by registered or
certified mail; and one day after the day it is sent if sent by overnight
courier.
3. Entire Agreement;
Modification. This Agreement contains the entire and complete
understanding between the parties concerning its subject matter and all
representations, agreements, arrangements and understandings between or among
the parties, whether oral or written, have been fully merged herein and are
superseded thereby.
4. Equitable Relief.
Employee acknowledges and agrees that his services are of a special,
unique and extraordinary value to Company and its Affiliates and that damages
alone may be an inadequate remedy for any breach of this Agreement. Accordingly,
in the event of the breach by Employee of any of the provisions of this
Agreement, Company may, in addition and supplementary to other rights and
remedies existing in its favor, apply to any court of law or equity of competent
jurisdiction for specific performance and/or injunctive or other relief in order
to enforce, or prevent any violations of the provisions of this
Agreement.
5.
Representation
by Counsel.
Employee acknowledges
that he has been represented by independent
legal counsel in connection with
this Agreement and has consulted with such legal counsel.
6.
Counterparts. This
Agreement may be executed in counterparts, all of which taken together will
constitute one instrument.
7.
Waiver.
Either party's failure to enforce any provision or provisions of this
Agreement shall not
in any way be construed as a waiver of any such provision or provisions, nor
prevent that party thereafter from enforcing each and every other provision of
this Agreement. The rights granted both parties herein are cumulative and shall
not constitute a waiver of either party's right to assert all
other legal remedies available to it under the
circumstances.
8.
Dispute Resolution;
Attorneys' Fees. This Agreement shall be governed by and construed
in
accordance with the laws of the State of Florida, without giving effect to its
principles regarding conflicts of law; and the courts located in Miami, Florida
shall have sole and exclusive jurisdiction over any action or proceeding brought
under or pursuant to this Agreement. The parties hereby agree that any service
of process may be affected on such party by delivering such process by hand,
depositing it with an overnight courier, or mailing it by registered or
certified mail to such party_ Upon default, the breaching party agrees to pay to
the non-breaching party's reasonable attorneys' fees, plus all other reasonable
expenses incurred by the non-breaching party in exorcising any of the
non-breaching party's rights and remedies.
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9.
Binding
Effect. Except as otherwise provided in this Agreement, this Agreement
shall be binding
upon and inure to the
benefit of the parties hereto and their respective successors, heirs, and
assigns.
Employee shall not assign, convey, or otherwise transfer, voluntarily or
by
operation of law, to any person or entity, this Agreement or any
interest herein without the prior written consent of Company. Any attempt
to do so without such consent shall be null and void.
10. Amendment.
This Agreement may not be modified and the rights
and obligations of the parties
contained
herein may not be altered, except by a written instrument signed by both
parties.
IN
WITNESS WHEREOF, the
parties hereto have duly
executed this Agreement as of
the date first above
written.
"Company"
MY SCREEN MOBILE,
INC
A Delaware
corporation
|
By:
|
/s/ Xxxxxxxxx Xxxxxxx | |
| Xxxxxxxxx Xxxxxxx, Chief Financial Officer |
"Employee"
| /s/ Xxxxxxxx Xxxxxxxx | |
| Xxxxxxxx Xxxxxxxx |
|
|
15
Certificate
The
undersigned hereby represents and warrants to My Screen Mobile, Inc. ("My Screen"), that attached hereto as Exhibit A, is a true
and correct copy of the non-compete covenant between the undersigned and Nokia,
the undersigned's current employer. This certificate is being provided to My
Screen in connection with an Employment Agreement to be entered into between My
Screen and the undersigned on or about the date hereof.
| /s/ Xxxxxxxx Xxxxxxxx | Dated: January ___, 2009 |
| Xxxxxxxx Xxxxxxxx |
16
Exhibit
A
Non-Compete and
Non-Solicitation You will not for a period of six months following
the termination of this agreement directly or indirectly commit yourself to any
other employment or assignment as a partner, manager, employee, consultant,
adviser, independent contractor or otherwise or prepare for such activity with
any business in competition with or otherwise similar to any business of Nokia
in which you worked and/or had access to its confidential proprietary
information at any time during your employment. In partial consideration of the
foregoing agreement, Nokia shall provide you with monetary compensation in the
form of an additional and separate payment for any part of the six month
non-compete period which falls outside of a notice of termination period. This
payment will be calculated on a pro-rata basis based on your annual base salary
and management incentive, payable pro-rata at 100% of target. Nokia can at its
sole discretion decide not to enforce part or all of this non-compete
obligation, in which case any of the consideration described in this paragraph
shall, at Nokia's discretion, be treated accordingly.
Furthermore,
you agree you will not directly or indirectly contribute to the solicitation for
employment outside of Nokia of any Nokia employee during the six months
following the termination of your employment.
A-1
