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EXHIBIT 10.4
EMPLOYMENT AGREEMENT
Between
XXXX.XXX CORPORATION
And
XXXXX X. XXXXXXXXXX
This Agreement confirms the terms of the employment relationship
between xxxx.xxx Corporation and its successors and assigns ("Employer"), and
Xxxxx X. Xxxxxxxxxx ("Employee"). Employee's employment by Employer began in
July 1995. In light of recent changes in Employer's business, Employee and
Employer desire to set forth Employee's terms of employment in writing. For
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
1. TERM OF AGREEMENT. Employee shall be employed by Employer for
a term of three years commencing on the first day of the month following the
closing of the initial public offering underwritten by Xxxxxxx and Company
Securities, Inc., as representatives of the Underwriters, unless employment is
sooner terminated as provided herein. This Agreement thereafter shall be
automatically renewed for succeeding terms of one (1) year, unless at least
ninety (90) days prior to the expiration of any term, either party gives
written notice, pursuant to Section 11.3 of this Agreement, to the other of
that party's intention not to renew this Agreement.
2. POSITION AND DUTIES. Employee will be employed as Chief
Financial Officer and in this capacity, Employee's responsibilities will
include, but are not limited to, those duties that may be described in the
Bylaws of Employer or may be defined by the Board of Directors of Employer.
2.1 From time to time, Employee may be assigned other
duties in addition to those described above, and Employee's responsibilities may
be modified or expanded at any time by Employer in order to accommodate the
needs of Employer. As Chief Financial Officer of Employer, the hours which
Employee is required to work will vary considerably and will sometimes be more
than forty (40) hours per week. Employee understands that such work in excess of
forty (40) hours per week is a regular and normal part of Employee's
responsibilities for which he is compensated, and does not in any way constitute
overtime for which Employee is entitled to receive additional compensation.
2.2 Employee will have the authority to hire and fire
other employees of the company under his supervision.
2.3 In addition to his employment responsibilities,
Employee will serve on the Employer's Board of Directors, if elected, and will
assume whatever corporate office said Board of Directors may designate.
2.4 Employee shall devote his full-time efforts to his
duties with Employer and Employee shall not directly or indirectly engage or
participate in any activities while employed with Employer that would conflict
with the best interests of Employer.
2.5 Employee's obligation to devote his full-time
attention and energy to the business of Employer shall not be construed as
preventing Employee from investing his assets so long as any such investment
will not require any services on the part of Employee in the operation of the
affairs of the company(ies) or business(es) in which such investment(s) is (are)
made.
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3. EMPLOYER'S COVENANTS
3.1 Employer shall furnish Employee with such equipment,
employees and services as are necessary to perform Employee's obligations under
this Agreement. Such equipment shall include, at a minimum, one desktop computer
together with all appropriate software programs, one laptop portable computer
with complete remote communications capability, and one cellular telephone.
Employer shall also pay for Employee's membership dues in professional
organizations, the reasonable costs of any seminar attendance or continuing
education requirements of Employee's profession and Employee's subscriptions to
a reasonable number of professional journals.
3.2 Employer shall reimburse Employee for all reasonable
business expenses incurred by Employee while on Employer's business. Employee
shall maintain such records as will be necessary to enable Employer to properly
deduct such items as business expenses when computing Employer's federal income
tax.
4. COMPENSATION
4.1 For all services rendered by Employee under this
Agreement, including services, if any, rendered in the capacity as a director of
the Company, Employer will pay Employee a base salary of Ninety Thousand Dollars
($90,000) per year (the "Base Salary"). Employee will be paid this salary on a
semi-monthly basis, minus all lawful and agreed upon payroll deductions.
4.2 During the term of this Agreement, Employer's Board
of Directors may authorize additional compensation by way of increases to the
Base Salary, bonus, or otherwise as deemed appropriate. During the term of this
Agreement, Employer's Board of Directors shall periodically review, on a basis
not more frequently than annually, Employee's Base Salary in light of Employee's
performance and the overall performance of Employer for purposes of considering
increases to Employee's annual salary.
4.3 Because Employer's earnings depend largely upon the
performance and productivity of Employee, Employer's Board of Directors shall
annually review the services rendered by the Employee and, at the sole
discretion of the Board of Directors, may award a bonus in an amount which will
recognize Employee's contributions to profits during that period.
5. FRINGE BENEFITS
5.1 During the term of this Agreement, Employee shall be
entitled to participate in all fringe benefits and incentive compensation plans
as may be authorized and adopted from time to time by the Employer and for which
Employee is eligible, including without limitation any and all stock option,
stock bonus, pension, profit sharing, disability, medical, group life insurance,
or other employee benefit plans.
5.2 Employee shall be entitled to a reasonable number of
paid sick leave days during each calendar year of employment. In determining
what is a reasonable number of days, Employer shall take into consideration
previous periods of disability, the number of days of sick leave taken in the
current year and preceding years, and other factors it deems pertinent. Employer
shall be the sole party to determine the reasonableness of Employee's number of
sick leave days.
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5.3 Employee shall be entitled to four (4) weeks' paid
vacation per calendar year.
5.4 Employer shall provide Employee a monthly automobile
allowance of Four Hundred Fifty Dollars ($450). Employer shall provide Employee
with a parking space at Employer's expense.
5.5 During the term of this Agreement, Employer and
Employee shall arrange for a mutually acceptable life term insurance policy for
Employee, payable to Employee's estate, in the amount of One Million Dollars
($1,000,000), and Employer shall pay up to 50% of the premium amount of such
life insurance policy provided that such amount does not exceed $1,000.00
annually.
6. CONFIDENTIAL INFORMATION. As a result of Employee's employment
with Employer, Employee will be acquiring and making use of confidential
information about Employer's business, including without limitation ideas,
products, financial and marketing information about Employer. Employee, for a
period of eighteen (18) months after the termination of this Agreement, will not
at any time, without the express prior written consent of Employer, disclose or
otherwise make known or available to any person, firm, corporation or other
entity other than Employer, or use for his own account, any information
identified by Employer as "confidential."
7. COVENANT NOT TO COMPETE. In view of the unique value to
Employer of Employee's services, during his employment with Employer, and for a
period of twenty four (24) months after termination of his employment, Employee
will not directly or indirectly: (a) as principal, owner, employee, or agent,
engage in any business involving Internet, Intranet or Extranet based products
and services using relational database techniques and database compilation
techniques for companies located in the United States; (b) solicit for
employment or employ any employee of Employer; and (c) solicit business from
clients of Employer.
8. SPECIFIC PERFORMANCE. Employee acknowledges that (a) the
covenants set forth in Sections 6 and 7 are essential elements of the
transactions contemplated in this Agreement, that, but for the agreement of
Employee to comply with such covenants, Employer would not have entered into
this Agreement, and that Employee has consulted with, or has had the opportunity
to consult with, counsel and has been advised in all respects concerning the
reasonableness of such covenants as to scope and limit of time; (b) Employer
will not have any adequate remedy at law if Employee violates the terms of
Sections 6 and 7 or fails to perform any of his other obligations hereunder; and
(c) Employer shall have the right, in addition to any other rights it may have,
to obtain in any court of competent jurisdiction temporary, preliminary and
permanent injunctive relief to restrain any breach, threatened breach, or
otherwise to specifically enforce any, of such covenants or any other
obligations of Employee if Employee fails to perform any of his obligations
under this Agreement.
9. TERMINATION. This Agreement will be terminated upon the
occurrence of any one of the following events:
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9.1 By either party to this Agreement, without cause,
upon not less than ninety days prior written notice, if the date of such notice
is within ninety days of the anniversary of the commencement of the term of this
Agreement, provided however that no such notice shall be effective for any
period prior to the third anniversary of the commencement of the term of this
Agreement.
9.2 Death of Employee.
9.3 For cause, where "cause" is defined as a willful
dereliction of duty or conviction of a felony.
10. EFFECT OF TERMINATION. Upon termination of Employee's
employment, Employer will pay Employee all salary, fringe benefits, bonuses and
all other remuneration which are due and owing to Employee as of the date of
termination, less legal deductions or offsets Employee may owe to Employer for
such items as salary advances or loans. Employee's signature on this Agreement
constitutes his authorization for all such deductions. Employee agrees to return
to Employer all of Employer's property of any kind which may be in Employee's
possession. In the event this Agreement is terminated, the terms and provisions
of this Agreement will also terminate, except for Sections 6, 7 and 8 of this
Agreement, which will survive termination of this Agreement.
11. MISCELLANEOUS
11.1 The terms and conditions described in this Agreement
constitute the essential terms and conditions of the employment arrangement
between Employer and Employee, all of which have been voluntarily agreed upon.
There are no other essential terms or conditions of the employment relationship
that are not described within this Agreement, and any change in the essential
terms and conditions of this Agreement must be in writing, signed by both
Employer and Employee to be effective.
11.2 The invalidity of all or any part of any section of
this Agreement shall not render invalid the remainder of this Agreement or the
remainder of such section. If any provision of this Agreement is so broad as to
be unenforceable, such provision shall be interpreted to be only so broad as is
enforceable. Employee and Employer acknowledge and stipulate that the covenants
set forth in Sections 6, 7, and 8 of this Agreement are fair and reasonably
necessary for the protection of Employer's protectable interests. In the event a
court of competent jurisdiction should decline to enforce any provision of
Sections 6, 7, and 8 as written herein, such provision shall be deemed to be
modified to the minimum extent necessary to render such provision enforceable.
11.3 Any notice given pursuant to this Agreement will be
sufficient if it is in writing and personally delivered to the party or sent by
certified mail, return receipt requested, addressed to the party at the
addresses set forth below each party's signature. Either party may change his or
its address by giving to the other written notice of such change as provided in
this paragraph.
11.4 This Agreement is made and will be construed and
performed under the laws of the State of Washington. In the event either party
is required to institute legal action to enforce the provisions of this
Agreement, venue shall be in King County, Washington. In any such legal action,
the substantially prevailing party in such litigation will be entitled to
recover reasonable attorneys' and experts' fees and expenses.
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11.5 The waiver by Employer of a breach of any provision
of this Agreement by Employee will not operate or be construed as a waiver by
Employer of any subsequent breach by Employee.
11.6 The captions and headings of the paragraphs of this
Agreement are for convenience and reference only and are not to be used to
interpret or define the provisions hereof.
11.7 The rights and obligations of Employer under this
Agreement will inure to the benefit of and be binding upon the successors and
assigns of Employer. The rights and obligations of Employee hereunder are
nonassignable. Employer may assign its rights and obligations to any entity
without the consent of Employee.
DATED May 9, 1997.
EMPLOYEE: xxxx.xxx CORPORATION:
/s/ Xxxxx X. Xxxxxxxxxx /s/ Xxxxxx X. Fine
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Xxxxx X. Xxxxxxxxxx By: Xxxxxx X. Fine, CEO
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