SECOND AMENDMENT TO EMPLOYMENT AGREEMENT
SECOND
AMENDMENT TO EMPLOYMENT AGREEMENT
WHEREAS, InfoSearch Media,
Inc., a Delaware corporation, with its principal place of business located
at
0000 Xxx Xxx Xxxxxx, Xxxxxx Xxx Xxx, Xxxxxxxxxx 00000, its affiliates,
subsidiaries, successors and assigns (the “Company”), and
Xxxxxx Xxxxxxx, an individual residing at 000 Xxxxx Xxxxxxx Xxxxx, Xxxxxxx
Xxxxx, Xxxxxxxxxx 00000 (the “Executive”), are parties to an
Employment Agreement dated January 4, 2006 and effective as of August 23, 2005,
as amended by the Amendment to Employment Agreement, effective as of July 1,
2006 (as amended, the “Agreement”), which is incorporated
herein by reference, and a copy of which is attached hereto as Exhibit
A.
WHEREAS, it is the desire
of the Company and the Executive to amend Sections 6 and 11 of the Agreement;
and
WHEREAS, the Company and
the Executive have agreed to memorialize this written amendment to the Agreement
(the “Amendment”).
NOW, THEREFORE, in
consideration of the premises and the mutual covenants and agreements
hereinafter set forth, and other good and valuable consideration, the receipt
and sufficiency of which the parties hereby acknowledge, the parties hereby
agree to amend the Agreement as follows:
1.
Definitions. Unless otherwise defined herein, all capitalized terms
and phrases used in this Amendment shall have their meanings as defined in
the
Agreement.
2. Effective
Date. The parties intend that this Amendment shall be effective as of
January 12, 2007 (the “Effective Date”).
3. Amended
Section 6(b) of Agreement.
(a)
The first sentence of Section
6(b) of the Agreement is hereby replaced in its
entirety as follows:
(b)
Quarterly Bonus. During the Term of this Agreement, the Executive
shall be entitled to a quarterly bonus in an amount not to exceed twenty-five
percent (25%) of the Base Salary for each calendar quarter (or pro-rata
portion thereof in the case of a period of less than three (3) months) within
the Board’s sole discretion based on its review of the operating performance of
the Company during the quarter to which the bonus pertains.
4. Amended
Section 11(d) of the Agreement.
(a)
Section 11(d)(ii) of the
Agreement is hereby replaced in its entirety as
follows:
(ii)
For purposes of this Agreement, “Change of Control” means the consummation
of: (a) any consolidation or merger of the Company pursuant to which fifty
percent (50%) or more of the outstanding voting securities of the surviving
or
resulting company are not owned collectively by the common share and warrant
holders of the Company as of January 12, 2007; (b) any sale, lease, exchange
or
other transfer (in one transaction or a series of related transactions) of
all,
or substantially all, of the assets of the Company other than any sale, lease,
exchange or other transfer to any company where the Company owns, directly
or
indirectly, one hundred percent (100%) of the outstanding voting securities
of
such company after any such transfer; (c) any person or persons or group (as
such term is used in Section 13(d) of the Securities Exchange Act of 1934,
as
amended (the “Exchange Act”)), acquiring or becoming the beneficial owner
(within the meaning of Rule 13d-3 under the Exchange Act) whether directly,
indirectly, beneficially or of record, of fifty percent (50%) or more of the
outstanding voting securities of the Company; or (d) by any entity, person,
or
group (including any affiliate thereof, other than the Company) of a tender
offer or exchange offer where the offeree acquires more than fifty percent
(50%)
of the then outstanding voting securities of the Company.
(b)
Section 11(d)(iv) of the
Agreement is hereby replaced in its entirety as
follows:
(iv)
In the event that the Executive terminates this Agreement and his employment
with the Company for “Good Reason,” the Company shall pay or provide to the
Executive (or, following his death, to the Executive’s heirs, administrators or
executors) an aggregate lump sum payment equal to: (a) any earned but
unpaid base salary, unpaid pro rata bonus and unused vacation days accrued
through the Executive’s last day of employment with the Company, including any
carryover days; (b) the Executive’s full base salary for six (6) months; (c) the
Executive’s bonuses that he would have been awarded during the same six (6)
month period; and (d) continued coverage, at the Company’s expense, under all
Benefits Plans in which the Executive was a participant immediately prior to
his
last date of employment with the Company, or, in the event that any such Benefit
Plans do not permit coverage of the Executive following his last date of
employment with the Company, under benefit plans that provide no less coverage
than such Benefit Plans, for a period of six (6) months (collectively subsection
11(d)(iv)(a), 11(d)(iv)(b), 11(d)(iv)(c) and 11(d)(iv)(d) are referred to as
the
“Continued Benefits”). Payment of the Continued Benefits shall be paid to
the Executive within forty-five (45) days of the Executive’s last day of
employment with the Company. The Company shall deduct, from all payments
made hereunder, all applicable taxes, including income tax, FICA and FUTA,
and
other appropriate deductions. In addition to the Continued Benefits, fifty
percent (50%) of the unvested options granted to Executive pursuant to the
Company’s 2004 Stock Option Plan will automatically vest in the event that the
Executive terminates this Agreement and his employment with the Company pursuant
to this Section 11(d)(iv).
5. Amended
Section 11(e)(ii) of the Agreement.
(a)
Section 11(e)(ii) of the
Agreement is hereby replaced in its entirety as
follows:
(ii)
By The Company. At any time during the Term of this Agreement, the
Company shall be entitled to terminate this Agreement and the Executive’s
employment with the Company without “Cause,” as that term is defined in Section
11(c)(i) hereinabove by providing written notice to the Executive at least
forty-five (45) days prior to the termination date. Upon termination by
the Company of this Agreement and the Executive’s employment with the Company
without Cause, the Company shall pay or provide to the Executive (or, following
his death, to the Executive’s heirs, administrators or executors): any
earned but unpaid base salary, unpaid pro rata bonus and unused vacation days
accrued through the Executive’s last day of employment with the Company,
including any carryover days. In addition, so long as Executive has not
and does not violate the provisions of Sections 12, 13 and 14 of this Agreement,
the Company shall pay or provide to the Executive (a) the Executive’s full base
salary for a period of six (6) months ; (b) the Executive’s bonuses that he
would have been awarded during the same six (6) month period; and (c) continued
coverage, at the Company’s expense, under all Benefits Plans in which the
Executive was a participant immediately prior to his last date of employment
with the Company, or, in the event that any such Benefit Plans do not permit
coverage of the Executive following his last date of employment with the
Company, under benefit plans that provide no less coverage than such Benefit
Plans, for a period of six (6) months (collectively subsection 11(e)(ii)(a),
11(e)(ii)(b) and 11(e)(ii)(c) are referred to as the “Continued
Benefits”). Payment of the Continued Benefits shall be paid to the
Executive in a lump sum payment within forty-five (45) days of the Executive’s
last day of employment with the Company. The Company shall deduct, from
all payments made hereunder, all applicable taxes, including income tax, FICA
and FUTA, and other appropriate deductions. In addition to the Continued
Benefits, fifty percent (50%) of the unvested options granted to Executive
pursuant to the Company’s 2004 Stock Option Plan that are not subject to a
performance vesting requirement will automatically vest in the event that the
Company terminates this Agreement and his employment with the Company pursuant
to this Section 11(e)(ii).
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6. New
Section 11(f) of the Agreement.
(a)
Section 11(f) is hereby
included in the Agreement as follows:
(f)
Change of Control.
(i)
If the Executive is terminated by the Company without “Cause” or if the
Executive resigns his employment with the Company for “Good Reason”, each within
twelve (12) months of a Change of Control, fifty percent (50%) of all (A)
unvested options to purchase stock of the Company, (B) unvested shares of
restricted stock and (C) other unvested equity compensation shall automatically
vest and become immediately exercisable and transferable. The Executive
shall have a period of ninety (90) days after termination of employment by
the
Company without “Cause” or termination of employment by the Executive for “Good
Reason” to exercise any unvested options or other unvested equity compensation
that vests under this Section 11(f)(i) as a result of such termination of
employment.
(ii)
In the event of a Change of Control, and immediately prior to such Change of
Control, any unvested options to purchase stock of the Company, all (A) unvested
options to purchase stock of the Company, (B) unvested shares of restricted
stock and (C) other unvested equity compensation shall automatically vest and
become immediately exercisable and transferable, unless the outstanding options,
restricted stock and other equity compensation are (x) assumed by the surviving
corporation or its parent or subsidiary on terms no less favorable and with
an
equity value equal to or greater than immediately prior to the Change of
Control; or (y) substituted by the surviving corporation or its parent or
subsidiary with equivalent awards for the outstanding options, restricted stock
and other equity compensation on terms no less favorable and with an equity
value equal to or greater than immediately prior to the Change of Control.
7. Other
Sections of Agreement Reaffirmed. All of the other sections of the
Agreement remain unchanged and are hereby ratified and reaffirmed as of the
date
hereof and shall remain in full force and effect.
8. Severability.
Should any term
or provision of this Amendment be finally determined by a court
of competent jurisdiction to be void, invalid, unenforceable or contrary to
law
or equity, the offending term shall be modified and limited (or if strictly
necessary, deleted) only to the extent required to conform to the requirements
of law and the remainder of this Amendment (or, as the case may be, the
application of provisions to other circumstances) shall not be affected thereby
but rather shall be enforced to the greatest extent permitted by law.
[SIGNATURE
PAGE FOLLOWS]
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BY HIS EXECUTION
BELOW, THE EXECUTIVE ACKNOWLEDGES AND STATES THAT HE HAS FREELY AND VOLUNTARILY
ENTERED INTO THIS AMENDMENT AND THAT HE HAS READ AND UNDERSTOOD EACH AND EVERY
PROVISION THEREOF.
EXECUTIVE
COMPANY
/s/
Xxxxxx
Xxxxxxx By:
/s/ Xxxxx Xxxxxxxx
XX
Date: May 1,
2007 Name:
Xxxxx Xxxxxxxx
XX
Title: Chief
Financial
Officer
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