Exhibit 10.8
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT Agreement (the "Agreement") is made and entered into on
the 11th day of August, 1999 by and between MCY Music World, Inc., a Delaware
corporation with offices at 000 0xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the
"Company"), and Xxxxxxx Xxxxx, an individual residing at
___________("Employee").
W I T N E S S E T H:
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WHEREAS, the Company desires to employ Employee as its Senior
Vice-President of Marketing; and
WHEREAS, Employee desires to gain employment with the Company
as its Senior Vice-President of Marketing under the terms and conditions herein
stated; and
NOW, THEREFORE, in consideration of the mutual premises,
covenants and Agreements hereinafter set forth, the parties hereby agree as
follows:
I. Term. The Company hereby employs Employee, and Employee
hereby accepts employment hereunder, for a term of thirty-six (36) months (the
"Term") commencing on the date hereof, subject to prior termination as provided
in Section 8 herein.
1. Position and Duties. Employee shall serve as the Senior
Vice-President of Marketing of the Company, shall be based in the New York area
and shall perform the following duties in addition to those which may from time
to time be prescribed by the Board of Directors or bylaws of the Company:
(i) Creation and implementation of an overall marketing
plan for the Company;
(ii) Advice to the Board with respect to competition, market
trends, demographic trends and market conditions; and
(iii)Management of Marketing, Media, Public Relations and
Advertising.
2. Compensation.
2.1 Base Salary. For Employee's services hereunder, the
Company shall pay to Employee an annual salary of $175,000 (such amount is
referred to herein as the " Base Salary"). The Base Salary shall be payable in
equal installments in conformity with
the Company's normal payroll period. The Base Salary shall be subject to a 10%
annual increase on each anniversary of this Agreement during the Term hereof.
2.2 Stock Options. In connection with the execution of this
Agreement, the Company shall cause XXX.xxx, Inc. ("XXX.xxx") to issue to
Employee options to purchase 200,000 shares of XXX.xxx's common stock, par value
$.001 per share at the exercise price of $13.00 per share, pursuant to XXX.xxx's
1999 Stock Incentive Plan (the "Plan"). These options shall vest over a period
of thirty-six months commencing four months from the date of this Agreement as
set forth on the annexed Stock Option Agreement.
2.3 Bonus Options; Definitions. Within one month from the end
of each consecutive six month period (the "Period") commencing on the date of
this Agreement, the Company shall make a calculation to determine whether the
Employee shall be entitled to receive additional options under the Plan (the
"Bonus Options") as a result of exceeding certain Milestones (as hereinafter
defined) during such Period. For purposes of determining whether Bonus Options
have been earned under this Section 3.3, the Company shall calculate, for the
Period immediately preceding such calculation (i) the number of "hits" or times
that the Company's web site has been visited (the "Hits") during such Period;
and (ii) the number of customers who have purchased at least one NETrax during
such Period (each person referred to herein as a "Customer").
2.4 Bonus Options; Calculation. Employee shall be entitled to
and shall receive up to a maximum 300,000 Bonus Options as follows:
(i) Employee shall receive 1,000 Bonus Options for every 20,000,000
Hits the Company's web site receives during the Period above the Milestone
established during the preceding Period; and
(ii) Employee shall receive 1,000 Bonus Options for every 150,000
Customers who purchase NETrax during the Period above the Milestone established
during the preceding Period.
2.5 Bonus Options; Milestones. 0 Hits and 0 Customers shall
become the respective first milestones (the "Milestones") from which the number
of Bonus Options which may be earned shall be calculated. Thereafter, the
Milestone utilized for the determination of Bonus Option calculations shall be
equal to the number of Hits which the Company has received on its web site and
the number of Customers who have purchased NETrax during the Period immediately
preceding such calculation.
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3. Employee Benefits.
3.1 Automobile Allowance. The Company shall pay to Employee a
monthly automobile allowance equal to the Employee's monthly lease payments, not
to exceed $600 per month, upon the submission of receipt for same by the
Employee.
3.2 Other Benefits. During the Term, Employee shall be
entitled to receive other perquisites and fringe benefits in accordance with the
plans and policies of the Company, including, without limitation, medical
insurance, disability and life insurance, participation in retirement and
savings plans, and other such perquisites and fringe benefits generally made
available by the Company to its executives and key management employees, subject
to and on a basis consistent with the terms, conditions, and overall
administration of such plans and policies.
4.3 Vacation. Employee shall be entitled to two weeks paid
vacation as is consistent with the Company's policies for its senior management.
The Employee shall additionally be paid for up to five (5) sick days and all
traditional holiday vacation days in accordance with Company policy and US Law.
4. Insurance. The Company shall have the right to apply for and
take out, in the Company's own name or otherwise, at the Company's expense,
life, health, accident, or other insurance covering Employee, in any amount the
Company deems necessary to protect the Company's interest hereunder, and
Employee shall have no right, title or interest in or to any such insurance.
Employee shall assist the Company in obtaining such insurance by submitting to
usual and customary medical and other examinations and by signing such
applications, statements and other instruments as may be reasonably required by
any insurance company.
6. Expenses. During the Term, Employee shall be entitled to
receive reimbursement for all reasonable business expenses incurred by him (in
accordance with the policies and procedures from time to time adopted by the
Board of Directors of the Company for its senior executives) in performing
services hereunder, provided that Employee properly accounts therefor in
accordance with such policy and procedures. All expenses over $5,000 shall be
pre-approved in writing by an officer of the Company.
7. Deductions and Withholdings. All amounts payable or which
become payable under any provision of this Agreement shall be subject to any
deductions authorized by Employee and any deductions and withholdings required
by law.
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8. Termination.
8.1 Death. This Agreement shall terminate immediately upon
Employee's death, unless sooner terminated hereunder, subject to Section 8.6 (a)
and (d) below.
8.2 Termination by the Company With Cause. The Company shall
have the right to terminate Employee's employment hereunder for Cause, subject
to Section 8.6 (c) and (d) below. For purposes of this Agreement, "Cause" means
(a) the failure by Employee substantially to perform his duties or obligations
hereunder; (b) Employee engaging in misconduct which is materially injurious to
the Company; (c) Employee's conviction of a crime of moral turpitude; or (d)
Employee's conviction by, or entry of a plea of guilty or nolo contendere in, a
court of competent jurisdiction of a crime constituting a felony.
8.3 Termination by the Company Without Cause. The Company may
terminate Employee's employment hereunder without Cause at any time during the
Term of this Agreement, subject to Section 8.6 (b) and (d) below.
8.4 Disability. If Employee shall be unable to perform his
services hereunder by reason of illness or other incapacity, his failure so to
perform his duties will not be grounds for terminating his employment for Cause
by the Company; provided, however, should the period of such incapacity exceed
three months, or if on 50% or more of the normal working days throughout six (6)
consecutive months Employee is unable to perform his duties fully due to such
incapacity, then the Company may terminate his employment hereunder, subject to
Section 8.6 (a) and (d) below.
8.5 Termination by the Employee. In the event that the
Employee terminates this Agreement, all rights and obligations of the Company
hereunder shall thereupon immediately terminate, as set forth in Section 8.6 (c)
and (d) below.
8.6 Effect of Termination.
(a) Upon termination of this Agreement or Employee's
employment hereunder pursuant to Sections 8.1 or 8.4
hereof, all compensation and benefits payable by the
Company hereunder shall be immediately terminated;
provided, however, Employee or his estate, as the case
may be, shall be entitled to receive any payments under
any applicable life or disability insurance plans. Such
payments, if any, shall be made
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at the time and in accordance with the terms and conditions
of such plans.
(b) Upon termination of Employee's employment pursuant to
Section 8.3 hereof, within 10 days after such
termination Employee shall be entitled to receive a
payment equal to three (3) months of Base Salary as
consideration for such termination.
(c) Upon termination of Employee's employment pursuant to
Sections 8.2 or 8.5 hereof, Employee shall not be
entitled to receive any payment upon such termination,
other than compensation and expenses accrued as at the
date of termination.
(d) Notwithstanding the termination of this Agreement or
any provision herein to the contrary, the Employee
shall in all events be subject to the Confidentiality
Agreement (as hereinafter defined) after the
termination of this Agreement pursuant to its terms.
9. General Provisions.
9.1 Notices. All notices required to be given under the terms
of this Agreement shall be in writing and shall be deemed to have been duly
given only if delivered to the addressee in person or mailed by certified mail,
return receipt requested, to the address as included in the Company's records or
to any such other address as the party to receive the notice shall advise by due
notice given in accordance with this paragraph. Any party hereto may change its
or his address for the purpose of receiving notices, demands and other
communications as herein provided, by a written notice given in the manner
aforesaid to the other party hereto.
9.2 Benefit of Agreement and Assignment. This Agreement shall
inure to the benefit of and be binding upon the parties hereto and their
respective executors, administrators, successors and assigns; provided, however,
that Employee may not assign any of his rights or duties hereunder except upon
the prior written consent of the Board of Directors of the Company.
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9.3 Applicable Law. This Agreement is made in and is to be
governed by and construed under the laws of the State of New York.
9.4 Captions. The captions appearing at the commencement of
the sections hereof are descriptive only and for convenience of reference only
and are not intended to be part of or to effect the meaning or interpretation of
this Agreement.
9.5 Severability. In the event that any one or more of the
provisions contained in this Agreement or in any other instrument referred to
herein, shall, for any reason, be held to be invalid, illegal or unenforceable
in any respect, then to the maximum extent permitted by law, such invalidity,
illegality or unenforceability shall not affect any other provision of this
Agreement or any other such instrument.
9.6 Entire Agreement. This Agreement contains the entire
Agreement of the parties, and supersedes any and all other Agreements, either
oral or in writing, between the parties hereto with respect to the subject
matter hereof. Each party to this Agreement acknowledges that no
representations, inducements, promises, or Agreements, oral or otherwise, have
been made by either party, or anyone acting on behalf of either party, which are
not embodies herein, and that no other Agreement, statement or promise not
contained in this Agreement shall be valid or binding.
9.7 Amendments. This Agreement may be modified or amended only
by an Agreement in writing signed by the Company and Employee.
9.8 Waiver. No waiver of any provision hereof shall be valid
unless made in writing and signed by the party making the waiver. No waiver of
any provision of this Agreement shall constitute a waiver of any other
provision, whether or not similar, nor shall any waiver constitute a continuing
waiver.
9.9 Attorneys' Fees. Should any party hereto institute any
action or proceeding at law or in equity, or in connection with any arbitration,
to enforce any provision of this Agreement, including an action for declaratory
relief, or for damages by reason of an alleged breach of any provision of this
Agreement, or otherwise in connection with this Agreement, or any provision
hereof, the prevailing party shall be entitled to recover from the losing party
or parties reasonable attorneys' fees and costs for services rendered to the
prevailing party in such action or proceeding.
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9.10 Representations and Warranties. Each party hereto
represents and warrants that it or he has the power and authority to execute and
deliver this Agreement and to perform its or his obligations hereunder.
9.11 Compliance with Laws and Policies. Employee agrees that
he will at all times comply strictly with all applicable laws and all current
and future policies of the Company, including but not limited to the Trust and
Confidentiality Agreement of even date herewith by and among the Employee and
the Company, the provisions of which are hereby incorporated herein by reference
and made a part hereof.
9.12 Arbitration. Any dispute or controversy arising under or
in connection with this Agreement, other than matters pertaining to injunctive
relief, including, without limitation, temporary restraining orders, preliminary
injunctions and permanent injunctions, shall, upon the written demand of either
party served upon the other party, be submitted to arbitration. Such arbitration
shall be held in the City of New York, New York, and conducted in accordance
with the Rules of the American Arbitration Association.
IN WITNESS WHEREOF, this Agreement is executed on the day and year
first above written.
MCY MUSIC WORLD, INC. EMPLOYEE
By: /s/ Xxxxxxxx Xxxxxxx By: /s/ Xxxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, Xxxxxxx Xxxxx
President
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