Exhibit 10.12
EMPLOYMENT AGREEMENT
DATED AS OF AUGUST 3, 2001
BY AND BETWEEN
BESTNET COMMUNICATIONS CORP.
AND
XXXXXX X. XXXXXXXXX
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT ("AGREEMENT") is entered into as of August 3,
2001, by and between BestNet Communications Corp, a Nevada corporation (the
"COMPANY"), and Xxxxxx X.. Xxxxxxxxx, an individual citizen of the State of
Michigan and resident of Kent County, Michigan ("EXECUTIVE").
RECITALS
1. The Company was organized and incorporated under the laws of the State
of Nevada, and has its principal office in Pima County, Arizona;
2. Executive is an individual residing in Kent County, Michigan, and is a
citizen of the State of Michigan; and
3. The Company wishes to employ Executive and Executive wishes to be
employed by the Company, on the terms and conditions set forth herein, based on
their full and complete understanding of the legal and practical significance of
each of the provisions of this Agreement.
ARTICLE I
DUTIES AND TERM
1.1 CONTINUED EMPLOYMENT. In consideration of their mutual covenants and
other good and valuable consideration, the receipt, adequacy and sufficiency of
which is hereby acknowledged, the Company agrees to maintain Executive in its
employ, and Executive agrees to remain in the employ of the Company, upon the
terms and conditions herein provided.
1.2 POSITION AND RESPONSIBILITIES.
(a) Executive shall serve as Chief Executive Officer of the Company
(or in a capacity and with a title of at least substantially equivalent quality)
reporting directly to the board of directors of the Company (the "Board").
Executive agrees to perform services not inconsistent with his position and
involving duties of comparable scope, dignity and importance to those of the
Chief Executive Officer as of the date of this Agreement, as shall from time to
time be assigned to him by the Board.
(b) During the period of his employment hereunder, Executive shall
devote substantially all of his business time, attention, skill and efforts to
the faithful performance of his duties hereunder. The Company must be made aware
of the Executive's appointment to any other Corporate or Association Boards
prior to acceptance.
1.3 TERM. Executive's employment with the Company shall commence on August
20, 2001 (the "COMMENCEMENT Date"), and shall continue for a three (3) year
period ending August 20, 2004, unless sooner terminated in accordance with the
terms of this Agreement. The Executive and the Company shall negotiate
Executive's employment relationship with the Company thereafter.
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ARTICLE II
COMPENSATION
For all services rendered by Executive in any capacity during his
employment under this Agreement, including, without limitation, services as an
officer, director or member of any committee of the Company or of any subsidiary
or affiliate of the Company, the Company shall compensate Executive as follows:
2.1 BASE SALARY. The Company shall initially pay to Executive an annual
base salary of $190,000.00 ($15,833.33 per month) (the "BASE SALARY") during the
term hereof; PROVIDED, HOWEVER, that in the event the Company institutes a
salary reduction program which affects all Senior Executives by the same
percentage, then Executive's Base Salary may be reduced by such percentage (and
the term "Base Salary" as used in this Agreement shall refer to the Base Salary
as so adjusted). Executive's Base Salary shall be paid in equal semi-monthly
installments. The Base Salary shall be reviewed annually by the Compensation
Committee of the Board, and the Board or the Compensation Committee may, in its
sole discretion, increase the Base Salary. The effective date of the Base Salary
shall be the Commencement Date.
2.2 INCENTIVE STOCK OPTIONS. The Company shall grant the following
Incentive Stock Options (the "INCENTIVE STOCK OPTIONS") to purchase shares of
the Company's Common Stock (the "COMMON STOCK"). The Incentive Stock Options
shall be granted pursuant to the Memorandum of Understanding dated June 19, 2001
attached hereto as EXHIBIT NO. 2, and evidenced by that certain Stock Option
Agreement dated June 19, 2001 (the "STOCK OPTION AGREEMENT"), a copy of which is
attached hereto as EXHIBIT NO. 1, which shall include the following terms:
(a) Executive shall be granted options to purchase 25,000 shares of
Common Stock upon the commencement of Executive's employment with the Company
provided that the performance goals referred to in item 2.2(c) have been
mutually agreed upon by the Company and the Executive. Such options shall fully
vest one year from the grant date or immediately in the event the Executive is
terminated without cause by the Company or for Good Reason by the Executive
prior to the vesting date of options established in Exhibit A to the Stock
Option Agreement. The options shall have a per share exercise price equal to the
closing purchase price of the Company's Common Stock on June 19, 2001;
(b) The Executive shall be granted options to purchase 25,000 shares
of Common Stock, which options shall vest on January 1, 2002, if at all, if the
President of the Company and Executive have successfully completed an equity
financing transaction initiated by the Executive by such date resulting in gross
proceeds to the Company of not less than $3,000,000. Such options shall have a
per share exercise price equal to the closing purchase price of the Company's
Common Stock on June 19, 2001; and
(c) Executive shall be granted options to purchase 450,000 shares of
Common Stock, 150,000 of which shall vest, if at all, on the one (1) year
anniversary date of the date of the commencement date of employment by Executive
and on each one (1) year anniversary date thereafter, provided, however, that
the vesting of each 150,000 tranche shall be contingent upon the Company
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achieving the financial goals set forth in the Company's business plan as set by
the Board from time to time.
(d) Vesting of the Options granted to the Executive may be accelerated
for the Company achieving the mutually agreed upon financial goals in a lessor
time frame.
The Incentive Stock Options shall vest in accordance with the vesting schedule
contained in EXHIBIT A to the Stock Option Agreement and shall be reviewed
annually by the Compensation Committee of the Board.
2.3 ADDITIONAL BENEFITS. Executive shall be entitled to participate in all
employee benefit and welfare programs, plans and arrangements (including,
without limitation, pension, supplemental pension and other retirement plans,
insurance, hospitalization, medical and disability benefits, travel or accident
insurance plans), which are from time to time available to the Company's
executive personnel; PROVIDED, HOWEVER, that there shall be no duplication of
termination or severance benefits, and to the extent that such benefits are
specifically provided to Executive under other provisions of this Agreement, the
benefits available under the foregoing plans and programs shall be reduced by
any benefit amounts paid under such provisions. Executive shall during the term
of his employment hereunder continue to be provided with benefits at a level
which shall in no event be less in any material respect than the benefits
available to Executive as of the date of this Agreement. Notwithstanding the
foregoing, the Company may terminate or reduce benefits under any benefit plans
and programs to the extent such reductions apply uniformly to all Senior
Executives entitled to participate therein, and Executive's benefits shall be
reduced or terminated accordingly. Specifically, without limitation, Executive
shall receive the following benefits:
(a) MEDICAL EXPENSES. As long as Executive is in the employ of the
Company, the Company shall provide Executive with medical, dental (preventive
and orthodontic), hospitalization and other health benefits.
(b) LIFE INSURANCE. As long as Executive is in the employ of the
Company, the Company shall acquire life insurance on the life of the Executive
for the benefit of Executive's beneficiaries, in such amount as shall be equal
to the product of two (2) times Executive's Base Salary.
(c) DISABILITY BENEFITS. As long as Executive is in the employ of the
Company, the Company shall provide short and long term disability benefits to
Executive.
(d) RELOCATION EXPENSES. In the event Executive's principal place of
employment is relocated by mutual consent of the parties outside Kent County,
Michigan, the Company shall reimburse Executive for all usual relocation
expenses incurred by Executive and his household in moving to the new location,
including, without limitation, moving expenses and rental payments for temporary
living quarters in the area of relocation for a period not to exceed six months.
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(e) REIMBURSEMENT OF BUSINESS EXPENSES. The Company shall, in
accordance with standard Company policies, pay, or reimburse Executive for, all
reasonable travel and other expenses incurred by Executive in performing his
obligations under this Agreement.
(f) VACATIONS. Executive shall be entitled to 20 business days,
excluding Company holidays, of paid vacation during each year of employment
hereunder. Executive may not accrue or carry forward unused vacation days.
ARTICLE III
TERMINATION OF EMPLOYMENT
3.1 DEATH OR RETIREMENT OF EXECUTIVE. This Agreement shall automatically
terminate upon death or Retirement (as defined in Section 6.1) of Executive.
3.2 BY EXECUTIVE. Upon giving Notice of Termination (as defined in Section
6.1) to the Company, Executive shall be entitled to terminate this Agreement for
Good Reason (as defined in Section 6.1).
3.3 BY COMPANY. Upon giving Notice of Termination to Executive, the Company
shall be entitled to terminate this Agreement:
(a) in the event of Executive's Total Disability (as defined in
Section 6.1); or
(b) for Cause (as defined in Section 6.1).
3.4 EARLY TERMINATION (INITIAL 3 MONTHS) WITHOUT CAUSE. The Executive and
the Company shall negotiate Executive's Early Termination without Cause.
ARTICLE IV
COMPENSATION UPON TERMINATION OF EMPLOYMENT
If Executive's employment hereunder is terminated, in addition to any other
rights or benefits specifically provided for herein, the Company shall be
obligated to provide compensation and benefits to Executive, as follows:
4.1 IN GENERAL. Except as otherwise provided in SECTION 4.2, if Executive's
employment is terminated for any reason, the Company shall:
(a) pay Executive (or his estate or beneficiaries) any Base Salary
which has accrued but not been paid as of the termination date (the "ACCRUED
BASE SALARY");
(b) pay Executive (or his estate or beneficiaries) for unused vacation
days accrued as of the termination date in an amount equal to his Base Salary
multiplied by a fraction the numerator of which is the number of accrued unused
vacation days and the denominator of which is 260 (the "ACCRUED VACATION
PAYMENT");
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(c) reimburse Executive (or his estate or beneficiaries) for expenses
incurred by him prior to the date of termination which are subject to
reimbursement pursuant to this Agreement (the "ACCRUED REIMBURSABLE EXPENSES");
and
(d) provide to Executive (or his estate or beneficiaries) any accrued
and vested benefits required to be provided by the terms of any
Company-sponsored benefit plans or programs (the "ACCRUED BENEFITS"), together
with any benefits required to be paid or provided in the event of Executive's
death or Total Disability under applicable law.
4.2 UPON TERMINATION BY THE COMPANY WITHOUT CAUSE OR BY EXECUTIVE FOR GOOD
REASON. Notwithstanding SECTION 4.1, if Executive's employment is terminated by
the Company without Cause or by Executive for Good Reason, the Company shall:
(a) pay Executive the Accrued Base Salary;
(b) pay Executive the Accrued Vacation Payment;
(c) pay Executive the Accrued Reimbursable Expenses;
(d) pay Executive the Accrued Benefits;
(e) continue to pay Executive his Base Salary for a period of twelve
(12) months following the termination date; and
(f) maintain in full force and effect, for Executive's and his
eligible beneficiaries' continued benefit, for twelve (12) months following the
termination date, the employee benefits pursuant to Company-sponsored benefit
plans, programs or other arrangements in which Executive was entitled to
participate immediately prior to such termination, subject to the terms and
conditions of the plans (the "CONTINUED BENEFITS"). If Executive's continued
participation is not permitted under the general terms and provisions of such
plans, programs and arrangements, the Company shall arrange to provide Executive
with Continued Benefits substantially similar to those which Executive is
entitled to receive under such plans, programs and arrangements.
4.3 STOCK OPTION VESTING. Notwithstanding any provision of the Stock Option
Agreement, if Executive's employment is terminated by the Company without Cause
or by the Executive for Good Reason, the Executive shall have up to six (6)
months after the termination date to exercise his vested options, to the extent
not previously exercised by Executive.
4.4 CHANGE OF CONTROL
Change in Control" shall mean (i) the time that the Corporation first determines
that any person and all other persons who constitute a group having acquired
direct or indirect beneficial ownership of fifty-one (51%) or more of the
Corporation's outstanding securities, or (ii) the time that the "Continuing
Directors" approves a transaction such that the Corporation is acquired by or
merged into another company.
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SEVERANCE COMPENSATION IN THE EVENT OF A TERMINATION UPON A CHANGE IN CONTROL.
In the event the Executive's employment is terminated in a Termination Upon a
Change in Control, the Executive shall be paid as severance compensation
("Severance compensation") an amount equal to 100% of his base salary in effect
at Termination. In the event of a Change of Control and the Executive's
employment is retained, no Severance Compensations shall be due the Executive.
In the event that the Executive's employment is terminated as a result of a
Termination Without Cause, the Executive shall be paid as Severance Compensation
an amount equal to 100% of his base salary paid in equal installments for a
period of six months from the date of such termination provided, however, that
if the Executive is employed by a new employer during such period, the Severance
Compensation payable to the Executive during such period will be reduced by the
amount of compensation that the Executive actually receives from the new
employer. However, the Executive is under no obligation to mitigate the amount
owed the Executive pursuant to this Section by seeking other employment or
otherwise. In the event of a Termination Upon a Change in Control or a
Termination Without Cause within the first twelve (12) months of a change in
control, the Executive shall also be entitled to an accelerated vesting of any
awards granted to the Executive under the Corporation's Stock Option Plan to the
extent provided in the stock option agreement entered into at the time of
employment.
ARTICLE V
RESTRICTIVE COVENANTS
5.1 CONFIDENTIALITY.
(a) Executive covenants and agrees to hold in strictest confidence,
and not disclose to any person without the express written consent of the
Company, any and all of the Company's Proprietary Information (as defined
below), except as such disclosure may be required in connection with his
employment hereunder. This covenant and agreement shall survive this Agreement
and continue to be binding upon Executive after the expiration or termination of
this Agreement, whether by passage of time or otherwise, so long as such
information and data shall remain proprietary information.
(b) Upon termination of this Agreement for any reason, Executive shall
immediately turn over to the Company any "Proprietary Information," as defined
in subparagraph (c) below. Executive shall have no right to retain any copies of
any material qualifying as Proprietary Information for any reason whatsoever
after termination of his employment hereunder without the express written
consent of the Company.
(c) For purposes of this Agreement, "PROPRIETARY INFORMATION" means
and includes the following: the identity of clients or customers or potential
clients or customers of the Company or its affiliates; any written, typed or
printed lists, or other materials identifying the clients or customers of the
Company or its affiliates; any financial or other information supplied by
clients or customers of the Company or its affiliates; any and all data or
information involving the Company, its affiliates, programs, methods, or
contacts employed by the Company or its affiliates in the conduct of their
business; any lists, documents, manuals, records, forms, or other material used
by the Company or its affiliates in the conduct of their business; and any other
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secret or confidential information concerning the Company's or its affiliates'
business or affairs. The terms "list," "document" or other equivalents, as used
in this subparagraph (c), are not limited to a physical writing or compilation
but also include any and all information whatsoever regarding the subject matter
of the "list" or "document," whether or not such compilation has been reduced to
writing. "Proprietary Information" shall not include any information which: (i)
is or becomes publicly available through no act or failure of Executive; (ii)
was or is rightfully learned by Executive from a source other than the Company
before being received from the Company; or (iii) becomes independently available
to Executive as a matter of right from a third party. If only a portion of the
Proprietary Information is or becomes publicly available, then only that portion
shall not be Proprietary Information hereunder.
(d) Executive acknowledges that he is Chief Executive Officer of the
Company and in such capacity he will be a representative of the Company with
respect to clients and potential clients of the Company. Executive also
acknowledges that he has had and will continue to have access to confidential
information about the Company, its affiliates, and their clients and that
"Proprietary Information" acquired by him at the expense of the Company is for
use in its business. Executive has substantial experience in the information
technology products and services marketing and distribution industry and
possesses special, unique, extraordinary skills, and knowledge in this field.
Executive's management and operational services to the Company are special,
unique, and extraordinary and the success or failure of the Company is dependent
upon his discharge of his duties and obligations. Accordingly, by execution of
this Agreement, and subject to subparagraph (c) hereof, Executive agrees that
during his employment with the Company and for a period of twelve (12) months
following the date of termination of his employment hereunder (the
"NON-COMPETITION PERIOD") for any reason (whether such termination shall be
voluntary or involuntary), he shall not violate the provisions of Section 5.2.
Executive agrees that the twelve (12) month period referred to in the preceding
sentence shall be extended by the number of days included in any period of time
during which he is or was engaged in activities constituting a breach of Section
5.2.
5.2 COMPETITION.
(a) During the Non-Competition Period specified in Section 5.1(d),
Executive shall not:
(i) except as a passive investor in publicly-held companies, and
except for investments held as of the date hereof, directly or indirectly own,
operate, manage, consult with, control, participate in the management or control
of, be employed by, maintain or continue any interest whatsoever in any company
that directly competes with the Company in the United States; or
(ii) directly or indirectly solicit any business of a nature that
is directly competitive with the business of the Company from any individual or
entity that obtained such products or services from the Company or its
affiliates at any time during his employment with the Company; or
(iii) directly or indirectly solicit any business of a nature
that is directly competitive with the business of the Company from any
individual or entity solicited by him on behalf of the Company or its
affiliates; or
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(iv) directly or indirectly solicit, or cause the solicitation
of, any employees of the Company who are in the employ of the Company on the
termination date of his employment hereunder for employment by others.
(b) Executive expressly agrees and acknowledges that:
(i) it will require at least 12 months for the Company to locate,
hire and train an appropriate individual to perform the functions and duties
that Executive is performing hereunder;
(ii) the Company has protected business interests throughout the
[United States of America] and that competition with and against such business
interests would be harmful to the Company;
(iii) this covenant not to compete is reasonable as to time and
geographical area and does not place any unreasonable burden upon him;
(iv) the general public will not be harmed as a result of
enforcement of this covenant not to compete;
(v) his personal legal counsel has reviewed this covenant not to
compete; and
(vi) he understands and hereby agrees to each and every term and
condition of this covenant not to compete.
5.3 NON-DISPARAGEMENT. During the term of this Agreement and the
Non-Competition Executive shall not disparage the Company or disclose to any
third party the conditions of Executive's employment with the Company except as
may be required in filings made pursuant to applicable law and the rules and
regulations of the Securities and Exchange Commission.
5.4 REMEDIES. Executive expressly agrees and acknowledges that this
covenant not to compete is necessary for the Company's and its affiliates'
protection because of the nature and scope of their business and his position
with the Company. Further, Executive acknowledges that, in the event of his
breach of his covenant not to compete, money damages will not sufficiently
compensate the Company for its injury caused thereby, and he accordingly agrees
that in addition to such money damages he may be restrained and enjoined from
any continuing breach of this covenant not to compete without any bond or other
security being required of any court. Executive acknowledges that any breach of
this covenant not to compete would result in irreparable damage to the Company.
Executive further acknowledges and agrees that if the covenant not to compete
herein is deemed to be unenforceable and/or the Executive fails to comply with
this Article V, the Company has no obligation to provide any compensation or
other benefits described in Article IV hereof. Executive acknowledges that the
remedy at law for any breach or threatened breach of Sections 5.1, 5.2 and 5.3
will be inadequate and, accordingly, that the Company shall, in addition to all
other available remedies (including without limitation, seeking such damages as
it can show it has sustained by reason of such breach), be entitled to
injunctive relief or specific performance.
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ARTICLE VI
MISCELLANEOUS
6.1 DEFINITIONS. For purposes of this Agreement, the following terms shall
have the following meanings:
(a) "ACCRUED BASE SALARY" - as defined in Section 4.1(a).
(b) "ACCRUED BENEFITS" - as defined in Section 4.1(d).
(c) "ACCRUED REIMBURSABLE EXPENSES" - as defined in Section 4.1(c).
(d) "ACCRUED VACATION PAYMENT" - as defined in Section 4.1(b).
(e) "BASE SALARY" - as defined in Section 2.1.
(f) "CAUSE" shall mean the occurrence of any of the following:
(i) Executive's gross and willful misconduct which is injurious
to the Company;
(ii) Executive has engaged in fraudulent conduct with respect to
the Company's business or in conduct of a criminal nature that may have an
adverse impact on the Company's standing and reputation;
(iii) the continued and unjustified failure or refusal by
Executive to perform the duties required of him by this Agreement which failure
or refusal shall not be cured within fifteen (15) days following (A) receipt by
Executive of written notice specifying the factors or events constituting such
failure or refusal, and (B) a reasonable opportunity for Executive to correct
such deficiencies;
(iv) Executive's use of drugs and/or alcohol in violation of then
current Company policy or Executive's failure to comply with other Company
policies in effect from time to time including, without limitation, policies
relating to sexual harassment; or
(v) Executive's breach of his duties under Section 1.2(b) hereof
which shall not be cured within fifteen (15) days after written notice thereof
to Executive.
(g) "CODE" shall mean the Internal Revenue Code of 1986, as amended.
(h) "CONTINUED BENEFITS" - as defined in Section 4.3(g).
(i) "GOOD REASON" shall mean the occurrence of any of the following:
(i) Without Executive's express written consent, a material
reduction by the Company in Executive's function, duties or responsibilities
(including reporting responsibilities) relative to Executive's function, duties
or responsibilities in effect immediately prior to such reduction, or
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Executive's removal from such function, duties or responsibilities, unless
Executive is provided with a comparable function, duties and responsibilities;
PROVIDED, HOWEVER, that a reduction in duties, position or responsibilities
solely by virtue of the Company being acquired and made part of a larger entity
shall not constitute "Good Reason";
(ii) Executive's Base Salary is materially reduced by the
Company, unless such reduction is pursuant to a salary reduction program as
described in Section 2.1 hereof or there is a material reduction in the benefits
that are in effect for the Executive immediately prior to such reduction, unless
such reduction is pursuant to a uniform reduction in benefits for all Senior
Executives;
(iii) The failure by the Company to obtain the assumption by
operation of law or otherwise of this Agreement by any entity which is the
surviving entity in any merger or other form of corporate reorganization
involving the Company or by any entity which acquires all or substantially all
of the Company's assets; or (iv) A failure by the Company to timely pay
Executive's Base Salary.
(j) "NON-COMPETITION PERIOD" - as defined in Section 5.1(d).
(k) "NOTICE OF TERMINATION" shall mean a notice which shall indicate
the specific termination provision of this Agreement relied upon and shall set
forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of Executive's employment under the provision so
indicated. Each Notice of Termination shall be delivered at least 30 days prior
to the effective date of termination.
(l) "PROPRIETY INFORMATION" - as defined in Section 5.1(c).
(m) "RETIREMENT" shall mean normal retirement at age 65 or in
accordance with rules generally applicable to the Company's executive employees
in accordance with any other retirement arrangement established with Executive's
consent with respect to Executive.
(n) "SENIOR EXECUTIVES" shall mean the five highest compensated
employees of the Company determined in accordance with applicable rules and
regulations of the Securities and Exchange Commission.
(o) "TOTAL DISABILITY" shall mean Executive's failure substantially to
perform his duties hereunder on a full-time basis for a period exceeding 180
consecutive days or for periods aggregating more than 180 days during any
twelve-month period as a result of incapacity due to physical or mental illness.
If there is a dispute as to whether Executive is or was physically or mentally
unable to perform his duties under this Agreement, such dispute shall be
submitted for a resolution to a licensed physician agreed upon by the Company
and Executive, or if an agreement cannot be promptly reached, the Company and
Executive will each select a physician, and if these physicians cannot agree,
they will pick a third physician whose decision shall be binding on all parties.
If such a dispute arises, Executive shall submit to such examinations and shall
provide such information as such physician(s) may request, and the determination
of the physician(s) as to Executive's physical or mental condition shall be
binding and conclusive.
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6.2 MITIGATION OF DAMAGES; DISPUTE RESOLUTION.
(a) The Company's obligation to make the payments provided for in this
Agreement and otherwise to perform its obligations hereunder shall not be
affected by any set-off, counterclaim, recoupment, defense or other claim, right
or action which the Company may have against the Executive or others. In no
event shall the Executive be obligated to seek other employment or take any
other action by way of mitigation of the amounts payable to Executive under any
of the provisions of this Agreement and such amounts shall not be reduced
whether or not the Executive obtains other employment. The Company agrees to pay
promptly as incurred, to the full extent permitted by law, all legal fees and
expenses which the Executive may reasonably incur as a result of any contest
(regardless of the outcome thereof) by the Company, the Executive or others of
the validity or enforceability of, or liability under, any provision of this
Agreement or any guarantee or performance thereof (including as a result of any
contest by the Executive about the amount of any payment pursuant to this
Agreement), plus in each case interest on any delayed payment at the applicable
Federal rate provided for in Code Section 1274(d) or any successor provision
thereto, for an obligation with a term equal to the length of such delay.
(b) If there shall be any dispute between the Company and Executive
(i) in the event of any termination of Executive's employment by the Company,
whether such termination was for Cause, or (ii) in the event of any termination
of employment of Executive, whether Good Reason existed, the dispute shall be
resolved in accordance with the dispute resolution procedures set forth in
EXHIBIT "A" hereto, and until there is a resolution and award declaring that
such termination was for Cause or that the termination by Executive for Good
Reason was not made in good faith, the Company shall pay all amounts, and
provide all benefits, to Executive and/or Executive's family or other
beneficiaries, as the case may be, that the Company would be required to pay or
provide hereunder as though such termination were by the Company without Cause
or by Executive with Good Reason, provided, however, that the Company shall not
be required to pay any disputed amounts pursuant to this subparagraph (b) except
upon receipt of an undertaking by or on behalf of Executive to repay, without
interest or penalty, all such amounts to which Executive is ultimately adjudged
not to be entitled as soon as possible after completion of the dispute
resolution with respect to the payment of such disputed amount.
6.3 SUCCESSORS; BINDING AGREEMENT. This Agreement shall be binding upon any
successor to the Company and shall inure to the benefit of and be enforceable by
Executive's personal or legal representatives, beneficiaries, designees,
executors, administrators, heirs, distributees, devisees and legatees.
6.4 MODIFICATION; NO WAIVER. This Agreement may not be modified or amended
except by an instrument in writing signed by the parties hereto. No term or
condition of this Agreement shall be deemed to have been waived, nor shall there
be any estoppel against the enforcement of any provision of this Agreement,
except by written instrument by the party charged with such waiver or estoppel.
No such written waiver shall be deemed a continuing waiver unless specifically
stated therein, and each such waiver shall operate only as to the specific term
or condition waived and shall not constitute a waiver of such term or condition
for the future or as to any other term or condition.
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6.5 SEVERABILITY. The covenants and agreements contained herein are
separate and severable and the invalidity or unenforceability of any one or more
of such covenants or agreements, if not material to the employment arrangement
that is the basis for this Agreement, shall not affect the validity or
enforceability of any other covenant or agreement contained herein. If, in any
judicial proceedings, a court shall refuse to enforce one or more of the
covenants or agreements contained herein because the duration thereof is too
long, or the scope thereof is too broad, it is expressly agreed between the
parties hereto that such duration or scope shall be deemed reduced to the extent
necessary to permit the enforcement of such covenants or agreements.
6.6 NOTICES. All notices and other communications required or permitted
hereunder shall be in writing and shall be delivered personally or sent by
registered or certified mail, return receipt requested, to the parties hereto at
the following addresses:
If to the Company, to it at:
BestNet Communications Corp.
0000 Xxxx Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxx, Xxxxxxx 00000
ATTN: President
with a copy to:
Xxxxxxx X. Xxxx, Esq.
Squire, Xxxxxxx & Xxxxxxx L.L.P.
00 Xxxxx Xxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
If Executive, to him at:
Xxxxxx X. Xxxxxxxxx
0000 Xxxxxxx Xxxx, Xxxxxxxxx, Xxxxx X
Xxxxx Xxxxxx, XX 00000
6.7 ASSIGNMENT. This Agreement and any rights hereunder shall not be
assignable by either party without the prior written consent of the other party.
6.8 ENTIRE UNDERSTANDING; TERMINATION OF PRIOR AGREEMENTS. This Agreement
constitutes the entire understanding between the parties hereto and no
agreement, representation, warranty or covenant has been made by either party
except as expressly set forth herein. All prior agreements relating to the
subject matter hereof, including the Prior Agreement, are hereby superseded in
their entirety and shall be of no further force or effect.
6.9 EXECUTIVE'S REPRESENTATIONS. Executive represents and warrants that
neither the execution and delivery of this Agreement nor the performance of his
duties hereunder violates the provisions of any other agreement to which he is a
party or by which he is bound.
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6.10 SURVIVORSHIP. Unless specifically stated to the contrary in this
Agreement, the rights and obligations of the Executive and Company set forth
herein shall continue beyond the term of this Agreement, including, but not by
way of limitation, the Company's obligations under Sections 2.5, 4.3, and the
Company's rights under Article V.
6.11 GOVERNING LAW. This Agreement shall be construed in accordance with
and governed for all purposes by the laws of the State of Arizona applicable to
contracts executed and wholly performed within such state.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the day and year first above written.
BESTNET COMMUNICATIONS CORP.,
a Nevada corporation
By: ____________________________________
Name: __________________________________
Title: _________________________________
EXECUTIVE
________________________________________
Xxxxxx Xxxxxxxxx
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