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EMPLOYMENT AGREEMENT
CKS Group, Inc., a Delaware corporation (hereafter referred to as the
"Employer", the "Company", or "CKS") and Xxxxxxx X. Xxxx (hereafter referred to
as "Employee") (jointly referred to hereafter as the "parties") wish to enter
into an agreement ("Agreement") pursuant to which CKS will continue to employ
the Employee. Accordingly, in consideration for the benefits and promises set
forth herein, the parties agree as follows:
1. Employment.
1.1 Position. Employee agrees to serve as the Employer's
Executive Vice President of Finance and Chief Financial Officer ("CFO")
reporting to the Chief Executive Officer ("CEO") of CKS with the specific
objectives of:
(a) managing all the financial and accounting operations
of the business, including but not limited to the treasury, financial planning
and analysis and accounting operations functions;
(b) managing the investor relations function and serving
as the key contact for investor relations with the sell and buy side analyst
communities;
(c) assisting in the development and implementation of the
Company's acquisition strategy;
(d) participating as a member of the senior executive
management team in developing strategy, annual operating plans and the like;
(e) hiring, firing, promoting, demoting and disciplining
subordinate personnel whose duties relate to the finance, accounting and
treasury functions, consistent with the Company's human resources policies and
procedures, and other policies;
(f) making regular reports required of other CKS corporate
officers on the Employer's operations to the CEO and to the Board of Directors
of the Company (the "Board"), as well as making other special reports as
required by the CEO and/or the Board;
(g) training such persons as may be designated by the CEO
with respect to any or all aspects of the Employer's operations.
1.2 Time and Effort. During his employment, Employee shall devote
his full energies, interest, abilities, and productive time to the performance
of this Agreement and shall not, without the prior written consent of the Board,
render to others services of any kind for compensation, or engage in any other
business activity that would materially interfere with the performance of his
duties under this Agreement. Notwithstanding this section 1.2 and subject to
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section 4.2 below, the Employee may, during the term of this Agreement,
participate in such civic, educational and religious organizations as do not
materially interfere with the performance of his duties. The Employee shall not
accept outside employment or board of director membership without the prior
written consent of the Company.
1.3 Employment for Unspecified Term. This Agreement provides for
employment for an unspecified term, commencing as of the date of this Agreement
and continuing until terminated by either party, as specified in Section 3
below.
2. Compensation and Benefits.
2.1 Basic Salary. Employer shall pay a basic salary to Employee
at the rate of $225,000.00 per year, payable in equal bi-weekly installments in
accordance with Employer's regular payroll practices except as otherwise agreed
in writing between Employer and Employee, provided that no salary shall be due
or payable during any period of unpaid leave, in accordance with Employer's
regular policies as they may exist or be changed from time to time. The
compensation package shall be subject to periodic review, and any modifications
thereto must be in writing signed by the parties to this Agreement.
2.2 Stock Options. The Company has previously granted to Employee
options to purchase common stock of the Company as follows:
Date of Grant Number of Shares Exercise Price Per Share
------------- ---------------- ------------------------
7/28/95 40,000 $ 1.00
6/1/96 40,000* 32.00
12/17/96 17,500 26.00
*Repriced to $20.00 per share on November 18, 1996
The option agreements evidencing such grants are referred to in this Agreement
as the Option Agreements.
In subsequent years, depending upon Employee's performance as evaluated by the
Employer and subject to applicable legal requirements, the Company may grant to
the Employee additional options in a manner consistent with the Employee's
status within the Company and the Company's treatment of other executives.
2.3 Bonus. Employee shall be eligible for bonus compensation as follows:
2.3.1 Personal Bonus. Employee shall be eligible for an
annual personal bonus of up to 50% of his basic salary, in addition to any
amounts that may be payable to Employee
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under Section 2.3.2 below, which annual personal bonus shall depend upon (a) his
performance and (b) the availability of funds for the payment of such a bonus,
as determined by the Board. The CEO shall evaluate the Employee's performance
annually.
2.3.1.1 Determination of Amount of Personal Bonus. Within
90 days following the date of this Agreement, Employee and the CEO will make a
good faith effort to define objective criteria by which Employee's performance
shall be evaluated for purposes of determining Employee's eligibility for a
personal bonus. If the Employee and the Company are able to define such
criteria, the Employee's personal bonus, if any, shall be calculated pursuant to
those criteria. Employee and the Company acknowledge that definition of such
criteria may prove to be impractical, however, in which case the evaluation of
Employee's performance and the determination of the amount of personal bonus, if
any, to be paid the Employee hereunder shall be at the sole discretion of the
CEO and the Board.
2.3.2 Executive Compensation Plan. Employee shall be
eligible to participate in the 1997 Executive Compensation Plan (and similar
executive compensation plans adopted in subsequent years) in accordance with the
terms and conditions of such plans.
2.4 Employee Benefits.
2.4.1 Fringe Benefits. During his employment, Employee
shall be entitled to life insurance in accordance with Employer's regular
practice, and medical, dental and disability insurance in accordance with
Employer's group insurance plans as they exist from time to time.
2.4.1.1 Effect of disability upon fringe benefits. If
Employee becomes disabled and unable to perform his duties and the Company's
disability insurance policy does not include provisions entitling Employee and
Employee's dependents to continued coverage under the Company's medical and
dental plans (at no cost to Employee or Employee's dependents) for so long as
such disability continues, then the Company shall continue to include Employee
and Employee's dependents on the Company's medical and dental insurance plans
(as they may exist from time to time) at the Company's expense for so long as
such disability continues.
2.4.2 Automobile. During the term of this Agreement,
Employer will provide Employee a monthly automobile allowance for the
acquisition, insurance and maintenance of a vehicle for CKS business use in an
amount equal to $1,000 per month (or such greater amount as Employer may
determine).
2.4.3 Vacation And Holidays. Employee shall be entitled to
annual vacation which will accrue at the rate of fifteen (15) working days per
year or such greater amount as is consistent with Employer's executive vacation
practices, subject, however, to the accrual maximums now or hereafter described
in Employer's policies for the accrual of unused vacation, but in no event shall
the accrual maximum for Employee be less than fifteen (15) working days per
year. Employee shall also be entitled to holiday pay for all holidays recognized
by Employer in accordance with the Employer's regular practices.
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2.5 Business Expenses. During Employee's employment, Employer
shall reimburse Employee for reasonable out-of-pocket expenses incurred in
connection with Employer's business, including travel and entertainment
expenses, food and lodging while away from home and cellular telephone expenses,
subject to such policies as Employer may from time to time establish for its
employees.
2.6 Withholding. All amounts to be paid by CKS to the Employee
are subject to applicable withholding for taxes, if any. Employer may withhold
from any and all payments, compensation or other remuneration paid to Employee
such amounts as Employer believes it is required to withhold under any federal,
state, local or foreign law, rule or regulation.
3. Termination.
3.1 Termination By Employer For Cause.
3.1.1 Definition of "for cause." As used in section 3.1
and its subparts, the term "for cause" means:
3.1.1.1 Violation of anti-discrimination policy. Any
violation by Employee of Employer's written policies (as they may exist from
time to time) prohibiting discrimination or harassment on the grounds of race,
sex, age or any other legally prohibited basis, provided that, for any violation
by the Employee of such policies occurring after a Change of Control (as defined
in section 3.5), (a) the Employer notifies the Employee of the facts allegedly
constituting the violation within 60 days after it acquires knowledge of such
facts, (b) the Employer affords the Employee 30 days within which to cease the
alleged violation and (c) the Employee fails to cease the alleged violation
within such 30 days.
3.1.1.2 Violation of law. Any violation by Employee of any
local, state, or federal law the violation of which is punishable other than as
an infraction.
3.1.1.3 Misconduct or dishonesty. The commission by
Employee of any material act of misconduct or dishonesty, or any material
failure to comply with the terms of the Proprietary Information Agreement
described in Section 4, below;
3.1.1.4 Material failure to achieve goals. Any material
failure to achieve goals agreed upon in writing by Employee and Employer;
provided, however, that notice of the Employer's intention to terminate
Employee's employment on the grounds of failure to achieve goals shall be given
within the fiscal quarter immediately following that in which such goals were
not achieved.
3.1.1.5 Insubordination or refusal to perform duties or
insubordination. Any insubordination or refusal by the Employee to perform the
duties described in this Agreement, provided that a Change of Control (as
defined in section 3.5) has not occurred.
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3.1.2 Compensation due to Employee upon Termination by
Employer for Cause. Except as contemplated by 3.5.3 following a Change of
Control, in the event Employer terminates Employee's employment for cause, as
defined in section 3.1.1, then Employee shall be entitled only to his basic
salary and bonuses earned up to and including the date on which CKS notifies him
of his termination for cause; provided, however, that if the cause for which
Employee is terminated is as defined in Section 3.1.1.4, Employer shall continue
to include the Employee and the Employee's dependents as beneficiaries of its
group medical, dental, disability and life insurance for 12 months and shall
reimburse the Employee for the cost of continuing such benefits for an
additional 18 months thereafter pursuant to the Consolidated Omnibus Budget
Reconciliation Act ("COBRA") if the Employee elects to continue such benefits at
the time of his termination and executes a Severance and General Release in the
form attached hereto as Exhibit B.
3.2 Termination By Employer Without Cause. In the event that,
without a Change of Control (as defined in section 3.5 below), the Employer
terminates the Employee's employment without cause, Employee shall be entitled
to severance compensation consisting of:
(i) continuation of Employee's basic salary (as set
forth in Section 2.1 and as it may be increased
from time to time) for twelve months following
the date on which the Employer notifies the
Employee of his termination;
(ii) bonus and incentive compensation equal to total
bonus and incentive compensation received (or
earned, but not yet received) by Employee during
the twelve months preceding the date on which the
Employer notifies the Employee of his
termination;
(iii) reimbursement by the Employer of the cost of
continuing Employee's (and Employee's
dependents') medical, disability, dental, life
and similar benefits for 12 months pursuant to
the Consolidated Omnibus Budget Reconciliation
Act ("COBRA"), if the Employee elects to continue
such benefits at the time of his termination;
(iv) continuation of his car allowance for twelve
months following the date on which the Employer
notifies the Employee of his termination; and
(v) an additional twelve months vesting on all
options held by Employee.
provided that the Employee executes a Severance and General Release Agreement in
the form attached hereto as Exhibit B.
3.2.1 Effect of Employee's subsequent employment. Employee
shall have no obligation to mitigate damages or payments due under this
paragraph; but if Employee obtains
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full time employment prior to the first anniversary of the date on which his
employment with CKS terminates, any income earned by the Employee during such
twelve months from Employee's new employer shall be offset against the Company's
payment obligations pursuant to section 3.2 above.
3.3 Termination By Employee for Good Reason.
3.3.1 Definition of "for good reason." As used in section
3.3 and its subparts, the term "for good reason" means any circumstances
resulting in the Employee no longer reporting to Xxxx X. Xxxxxx as CEO of CKS,
provided that the Employee terminates his employment within 120 days after the
date on which the Employee first reports to someone other than Xx. Xxxxxx.
3.3.2 Compensation due to Employee Upon Termination by
Employee for Good Reason. In the event that the Employee terminates his
employment for good reason, as defined in section 3.1.1, the Employee shall be
entitled to severance compensation consisting of:
(i) continuation of Employee's basic salary (as set
forth in Section 2.1 and as it may be increased
from time to time) for twelve months following
the date on which the Employee notifies the
Company of his termination;
(ii) bonus and incentive compensation equal to total
bonus and incentive compensation received (or
earned, but not yet received) by Employee during
the twelve months preceding the date on which the
Employee notifies the Company of his termination;
(iii) reimbursement by the Employer of the cost of
continuing Employee's (and Employee's
dependents') medical, disability, dental, life
and similar benefits for 12 months pursuant to
the Consolidated Omnibus Budget Reconciliation
Act ("COBRA"), if the Employee elects to continue
such benefits at the time of his termination;
(iv) continuation of car allowance for twelve months
following the date on which the Employee notifies
the Company of his termination; and
(v) an additional twelve months vesting on all
options held by Employee.
provided that the Employee executes a Severance and General Release Agreement in
the form attached hereto as Exhibit B.
3.3.3 Effect of Employee's subsequent employment. Employee
shall have no obligation to mitigate damages or payments due under this
paragraph; but if Employee obtains full time employment prior to the first
anniversary of the date on which his employment with CKS
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terminates, any income earned by the Employee during such twelve months from
Employee's new employer shall be offset against the Company's payment
obligations pursuant to section 3.3.2 above.
3.4 Termination by Employee Without Cause. Employee shall have
the right to terminate his employment without cause by notifying the Company 30
days in advance of the date on which his employment is to terminate. Should
Employee elect to terminate employment without cause (and without Good Reason):
(i) Employee shall not be entitled to severance
compensation of any kind;
(ii) Employee shall not be entitled to exercise stock
options except for vested shares (which shall be
exercisable in accordance with the Option
Agreements); and
(iii) Employee shall forfeit any and all right to any
bonus compensation pursuant to Section 2.3
during the year in which employment is
terminated; provided, however, that if Employee
elects to terminate employment under this
section within the 90 days prior to the end of
the Employer's fiscal year, Employee shall
receive a pro rata share of the bonus which
would be provided to Employee under the 1977
Executive Compensation Plan (or any similar
compensation plan in subsequent years) in
accordance with the terms and conditions of such
plan; provided, however, that if Employee has
earned bonus compensation for the prior fiscal
year, but such bonus has not yet been paid to
Employee, Employee shall be entitled to such
bonus compensation.
3.5 Involuntary or Constructive Termination Following a Change
of Control.
3.5.1 Definition of "Constructive Termination." As used in
section 3.5 and its subparts, "Constructive Termination" shall mean:
(a) without the Employee's express written consent, (i)
a significant reduction of the Employee's duties, position or responsibilities
relative to the Employee's duties, position or responsibilities in effect
immediately prior to such reduction, or (ii) the removal of the Employee from
such position, duties and responsibilities, unless the Employee is provided with
a comparable position, duties and responsibilities;
(b) a substantial reduction, without the Employee's
express written consent, of the facilities and perquisites (including office
space and location) available to the Employee immediately prior to such
reduction;
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(c) a reduction by the Company of the Employee's base
salary or bonuses paid in comparison with the prior year;
(d) a material reduction by the Company in the kind or
level of employee benefits to which the Employee is entitled, with the result
that the Employee's overall benefits package is significantly reduced;
(e) any reduction, after a Change of Control, in the
disability benefits available to Employee prior to the Change of Control;
(f) the relocation of the Employee to a facility or a
location more than twenty (20) miles from his current location without the
Employee's express written consent, or
(g) the failure of the Company to obtain the assumption of
this Agreement by any successors contemplated in Section 6.10 below;
(h) an increase of 10% or more in the number of days which
the Employee travels outside of Santa Xxxxx, San Mateo, San Francisco, Santa
Xxxx, Contra Costa or Alameda Counties, in comparison with the number of such
days in the 12 months preceding the Change of Control (or, if Employee has not
been employed for 12 months at the time of the Change of Control, the number of
days determined by dividing the days Employee did travel by the number of days
Employee was employed, and multiplying the result by 365);
provided that, with respect to subparagraphs (b), (d) and (e)
above, (i) the Employee notifies the Company of the facts allegedly constituting
his Constructive Termination and his intention to terminate his employment
within 30 days after he acquires knowledge of such facts, (ii) the Employee
affords the Company 30 days within which to remedy the alleged Constructive
Termination and (iii) the Company fails to remedy the alleged Constructive
Termination within such 30 days.
3.5.2 "Change of Control." As used in section 3.5 and its
subparts, "Change of Control" shall mean:
(a) the approval by shareholders of the Company of a
merger or consolidation of the Company with any other corporation, other than a
merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) at least fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation, or the approval by
the shareholders of the Company of a plan of complete liquidation of the Company
or an agreement for the sale or disposition by the Company of all or
substantially all of the Company's assets.
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(b) Any "person" (as such term is used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934, as amended, but excluding
officers of CKS and the Director of the Interpublic Group) becoming the
"beneficial owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing 50% or more of the total
voting power represented by the Company's then outstanding voting securities;
(c) A change in the composition of the Board of Directors
of the Company occurring within a two-year period, as a result of which fewer
than a majority of the directors are Incumbent directors. "Incumbent Directors"
shall mean directors who either (i) are directors of the Company as of the date
hereof, or (ii) are appointed, or nominated for election to the Board of
Directors of the Company with the affirmative votes of at least a majority of
the Incumbent Directors at the time of such election or nomination in connection
with an actual or threatened proxy contest relating to the election of directors
of the Company.
3.5.3 Acceleration of Vesting Following Change of Control. On
the effectiveness of any Change of Control, the vesting of all options granted
to Employee by the Company shall be accelerated so that, as to each such option,
one half of the shares subject to such option which were not otherwise vested at
the effective time of the Change of Control shall become vested at such
effective time, and the remaining unvested shares shall continue to vest
thereafter at the same rate (number of shares per month) as was in effect prior
to the Change of Control.
3.5.4 Compensation due to Employee Upon Involuntary or
Constructive Termination Following a Change in Control. If, following a Change
of Control as defined above, the Employee's employment is terminated
involuntarily (for any reason) or by Constructive Termination, the Employer
shall
(i) pay to Employee in a single lump sum an amount
equal to (A) 12 months basic salary (at the rate
in effect prior to the Change of Control or the
date of termination, whichever is greater), plus
(B) the total amount paid to or earned by
Employee as incentive compensation or bonus
payments during the twelve months preceding the
Change of Control or date of termination,
whichever is greater,
(ii) reimburse Employee for the cost of continuing
Employee's (and Employee's dependents') medical,
disability, dental, life and similar benefits for
12 months pursuant to the Consolidated Omnibus
Budget Reconciliation Act ("COBRA"), if the
Employee elects to continue such benefits at the
time of his termination;
(iii) continue for a period of twelve months to provide
the car allowance, professional association dues
and continuing legal education benefits enjoyed
by Employee immediately prior to the Change of
Control, and
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(iv) accelerate the vesting of all then unvested
options held by the Employee at the date of
termination such that those shares shall vest
immediately;
provided that the Employee executes a Severance and General Release Agreement in
the form attached hereto as Exhibit B.
3.5.5 Effect of Employee's subsequent employment. Employee shall
have no obligation to mitigate damages or payments due under this paragraph, nor
shall any amounts earned by Employee be offset against the amounts payable to
Employee under Section 3.5 and its subsections.
3.6 Termination By Death or Permanent Disability.
3.6.1 Definition of "Permanent Disability." For the purpose of
section 3.7 and its subparts, the term "Permanent Disability" means the
Employee's inability to perform his duties hereunder (with or without reasonable
accommodation) for 120 or more working days during any twelve-month period.
3.6.2 Effect of Death or Permanent Disability of Employee. The
Employee's employment will terminate automatically upon the death or Permanent
Disability of Employee, in which case Employee or his estate will be entitled
only to compensation earned through the date of such death or Permanent
Disability; provided, however, that, in the event of a Permanent Disability,
Employer will continue to include Employee and Employee's dependents on the
Company's medical and dental insurance plans (as they may exist from time to
time) for so long as such disability continues at the Company's expense.
3.7 Effect of Dispute Regarding Nature of Termination. In the event
that the parties disagree on the nature of the termination of the Employee's
employment (such as whether a termination was for cause or not) and submit such
dispute to arbitration, the effective date of the termination of the Employee's
employment shall be determined as if no dispute arose. In the event that the
parties disagree on whether a Constructive Termination or Change in Control has
occurred and submit such dispute to arbitration, the Employee shall be deemed to
have terminated his employment without cause in the event if the arbitrator
determines that a Constructive Termination or Change in Control did not occur.
4. Trade Secrets and Confidential Information.
4.1 Proprietary Information. Employee recognizes that as an
executive of the Employer, Employee occupies a position of trust with respect to
much business information of a secret or confidential nature which is the
property of the Employer and which will be imparted to Employee from time to
time in the course of Employee's duties. Employee therefore agrees that Employee
shall not, at any time, whether in the course of his employment or thereafter,
use or disclose directly or indirectly to any person outside the Employer any of
such information, except as
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required in the ordinary course of Employee's duties under this Agreement.
Concurrently with the execution of this Agreement, Employee shall sign the
Proprietary Information Agreement attached hereto as Exhibit C (the "Proprietary
Information Agreement").
4.2 Non-Competition with Employer. During his employment, and so
long as this contract remains in effect and any payments or benefits are
provided to the Employee, the Employee shall not, directly or indirectly,
promote, participate, or engage in any activity or other business competitive
with Employer's business, or any of its affiliates, and shall not solicit the
Company's employees or customers, or the employees or customers of any of
Employer's affiliates, nor shall Employee engage in any act or conduct which
creates, or appears to create, a conflict of interest with Employer, except as
may be approved in writing by the CEO; provided, however, that this section 4.2
shall not apply if Employee is terminated involuntarily or by constructive
termination following a Change of Control.
5. Miscellaneous.
5.1 Notice. All notices, requests and other communications
required or permitted to be given hereunder shall be in writing and shall be
deemed given (a) upon receipt, if given by personal delivery; (b) upon delivery,
if given by electronic facsimile, with proof of receipt; and (c) upon the third
business day following mailing, if mailed by deposit in the United States mail,
with certification and postal charges prepaid, addressed as follows (or such
other address as either party may provide to the other from time to time).
If to Employer:
CKS Group, Inc.
0000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attn: President and Chief Executive Officer
Fax: (000) 000-0000
If to Employee:
Xxxxxxx X. Xxxx
00000 Xx Xxxxxx Xxxxxx
Xxxxxxxx, XX 00000
5.2 Delegation of Duties. Employee may not delegate the services
and obligations he is required to perform under this Agreement. Any attempt by
Employee to delegate his duties hereunder shall be null and void.
5.3 Amendment. This Agreement may be modified or amended only by
and to the extent of the written agreement of Employer and Employee.
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5.4 Previous Agreements. This Agreement, together with the
Proprietary Information Agreement and the Stock Option Agreements, contains the
entire agreement between the parties and supersedes all prior oral and written
agreements, understandings, commitments, and practices between the parties,
including all prior employment or consulting agreements, whether or not fully
performed before the date of this Agreement.
5.5 Governing Law. Except as provided by section 5.8 below, this
Agreement shall be governed by and construed in accordance with the internal
laws of the State of California.
5.6 Section Headings. The various section headings are inserted
for convenience of reference only and shall not affect the meaning or
interpretation of this Agreement or any section thereof.
5.7 Severability. If provision of this Agreement is held by a
court of competent jurisdiction to be invalid, illegal or unenforceable, such
provision will be deemed amended to the minimum extent necessary to conform to
applicable law so as to be valid, legal and enforceable; if such provision
cannot be amended as provided above, it will be stricken and the remainder of
this Agreement will remain in full force and effect.
5.8 Arbitration. It is further understood and agreed that if, at
any time, a violation of any term of this Agreement is asserted by any party
hereto, that party shall have the right to seek specific performance of that
term and/or any other necessary and proper relief, including but not limited to
damages, before an arbitrator as set forth below. Each party will pay its own
costs and attorneys fees. The Company shall pay the costs of the arbitrators.
The parties agree that if they have any dispute as to the terms of or
obligations created by this Agreement, or should either party to this Agreement
have any dispute as to Employee's termination or compensation, or should
Employee allege that Employer or any of its employees, managers, officers,
directors or other representatives has violated any of Employee's rights under
state or federal civil rights laws including, but not limited to, the California
Fair Employment and Housing Act (Cal. Gov. Code Sections 12900, et seq.), the
Civil Rights Act of 1964 (42 U.S.C. Sections 2000e, et seq.), the Equal Pay Act
of 1963 (29 U.S.C. Sections 206(d)), the Americans With Disabilities Act of 1990
(42 U.S.C. Sections 12101, et seq., or California Labor Code Section 1102.1,
they will submit any such dispute to final and binding arbitration before a
neutral arbitrator selected from the roster of Judicial Arbitration and
Mediation Services, or before any other neutral, and pursuant to any other such
procedures, as the parties may agree upon. To be timely, any such dispute must
be referred to arbitration within twelve (12) months of the incident or
complaint giving rise to the dispute; disputes not referred to arbitration
within such twelve (12) twelve month period shall be deemed waived, and the
arbitrator shall deny any untimely claims. THE PARTIES EXPRESSLY AGREE THAT SUCH
ARBITRATION SHALL BE THE EXCLUSIVE, FINAL AND BINDING REMEDY FOR ANY DISPUTE
INVOLVING OR RELATED TO AN ALLEGED BREACH OF THIS AGREEMENT, EMPLOYMENT
TERMINATION, COMPENSATION, THE VIOLATION OF XX. XXXX'X CIVIL RIGHTS, OR ANY
OTHER MATTER ARISING OUT OF OR RELATED TO XX. XXXX'X EMPLOYMENT, AND HEREBY
EXPRESSLY WAIVE ANY RIGHT THEY HAVE OR MAY HAVE TO A COURT TRIAL OR A JURY TRIAL
OF ANY SUCH DISPUTE. In making an award, the
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arbitrator shall have no power to add to, delete from or modify this Agreement,
or to enforce purported unwritten agreements or prior agreements, or to construe
implied terms or covenants into the Agreement, the parties being in agreement
that no such oral or implied terms or covenants or unwritten agreements or prior
agreements are intended by them to remain enforceable, to the extent they may
ever have been so. In reaching his or her decision, the arbitrator shall adhere
to the relevant law and applicable precedent and shall have no power to vary
therefrom. In construing this Agreement, its language shall be given a fair and
reasonable construction in accordance with the intention of the parties, and
without regard to, or the aid of, Section 1654 of the California Civil Code. At
the time of issuing a decision, the arbitrator shall (in the decision or
separately) make specific findings of fact and shall set forth such facts as
support the decision, as well as his conclusions of law, and the reasons and
bases for his opinion, and such a decision incorporating these elements shall be
a condition precedent to its enforcement. The decision of the arbitrator shall
be final and binding; provided, however, that in the event the arbitrator
exceeds the powers or jurisdiction here conferred, or fails to issue a decision
in conformance herewith, it is specifically agreed that the aggrieved party may
petition a court of competent jurisdiction to correct or vacate such award, and
that the arbitrator's act of exceeding his or her powers shall be grounds for
granting such relief. It is further agreed by the parties that venue for any
arbitration proceedings shall be Santa Xxxxx County, California. This
arbitration clause is entered pursuant to, and shall be governed by, the Federal
Arbitration Act (9 U.S.C. Section 1, et seq.), but in all other respects this
agreement shall be governed by the provisions of California law. If any one or
more provisions of this arbitration clause shall for any reason be held invalid
or unenforceable, it is the specific intent of the parties that such provisions
shall be modified to the minimum extent necessary to make it or its application
valid and enforceable.
5.9 Waiver. Waiver of any default or breach of this Agreement or
of any warranty, representation, covenant or obligation contained herein shall
not be construed as a waiver of any subsequent breach.
5.10 Successors.
(a) Company's Successors. Any successor of the Company
(whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) to all or substantially all of the
Company's business and/or assets shall assume the Company's obligations under
this Agreement and agree expressly to perform the Company's obligations under
this Agreement in the same manner and to the same extent as the Company would be
required to perform such obligations in the absence of a succession. For all
purposes under this Agreement, the term "Company" shall include any successor to
the Company's business and/or assets which executes and delivers the assumption
agreement described in this subsection (a) or which becomes bound by the terms
of this Agreement by operation of law.
(b) Employee's Successors. Except as otherwise provided in
this Agreement, the terms of this Agreement and all rights of the Employee
hereunder shall inure to the benefit of, and be enforceable by, the Employee's
personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.
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5.11 Notice of Termination. Any termination of this Agreement by
the Company for cause or by the Employee with cause or without cause or
following a Change in Control or Constructive Termination shall be communicated
by a notice of termination to the other party hereto given in accordance with
this Section 5.11. Such notice shall indicate the specific termination provision
in this Agreement relied upon, shall set forth in reasonable detail the facts
and circumstances claimed to provide a basis for termination under the provision
so indicated, and shall specify an effective date of termination which shall be
no more than 30 days after the giving of such notice.
5.12 Conflict with Option Agreements. To the extent that the
provisions of this Agreement conflict with the provisions of any of the Option
Agreements (or any agreement evidencing any option granted in the future to
Employee), the terms of this Agreement shall control, and this Agreement shall
be deemed to be an amendment to any such Option Agreement (or subsequent
agreement evidencing any option granted in the future to Employee) to the extent
of such conflict, so as to make the provisions of any such Option Agreement or
other agreement consistent with this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement in one or
more counterparts which, taken together, shall constitute one agreement.
EMPLOYER:
CKS GROUP, INC.
By:/s/ Xxxx X. Xxxxxx
-----------------------------------------
Xxxx X. Xxxxxx
President and Chief Executive Officer
Date: September 25, 1997
---------------------------------------
EMPLOYEE:
/s/Xxxxxxx X. Xxxx
--------------------------------------------
Xxxxxxx X. Xxxx
Date: September 25, 1997
---------------------------------------
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