EMPLOYMENT AGREEMENT
This
EMPLOYMENT
AGREEMENT
(the
“Agreement”),
dated
as of June 5, 2008 (the “Effective
Date”),
is by
and between GoFish Corporation, a Nevada corporation (the “Company”)
and
Xxxx Xxxxxxx (“Executive”).
|
I.
|
POSITION
AND RESPONSIBILITIES
|
A. Term.
The
Company shall employ Executive from the Start Date (as defined below) until
Executive’s employment is terminated in accordance with Sections III, IV or V
below (the “Term”).
The
Company and Executive shall mutually agree on a date on which Executive will
commence employment with the Company (the “Start
Date”)
as
soon as practicable after the Effective Date.
B. Position.
Upon
the
Start Date, the Company shall employ Executive to render services to the
Company
in the position of Chief Executive Officer of the Company. Executive shall
perform such duties and responsibilities as are normally related to the position
in accordance with the standards of the industry and any additional duties,
consistent with his position, now or hereafter reasonably assigned to Executive
by the Company’s Board of Directors (the “Board
of Directors”).
Executive shall report to the Board of Directors. Executive shall abide by
the
reasonable rules, regulations, and practices as adopted or modified from
time to
time by the Board of Directors. Executive will also serve as a member of
the
Board of Directors effective as of the Effective Date. Executive shall also
serve as an officer, director, or in such other executive capacity on behalf
of
any of the Company’s affiliated entities as requested by the Company without any
additional compensation. Executive shall be located in the Company’s office in
New York and shall be expected to travel, including spending up to fifty
percent
(50%) of his time in the Company’s San Francisco and Los Angeles offices, if
necessary, and to be available for special calls and teleconference meetings
to
meet the obligations of his position.
C. Other
Activities.
By
executing this Agreement, Executive agrees to serve in such position and
to
devote his full time, attention, loyalty and efforts to the performance of
Executive’s duties. Executive may, during the Term, serve as an advisor to or be
on the board of directors of other companies as long as those companies
are not competitors of Company. Competitors of the Company, for this
purpose, include but are not limited to, online vertical advertising networks,
brand advertising networks and companies that target the online youth
demographic based on an internet advertising-based business model.
Notwithstanding any provision of this Section I(C), Executive shall be permitted
to engage in charitable and civic activities and manage his personal passive
investments; provided
that
such activities do not materially interfere with the performance of his duties
under this Agreement.
D. No
Conflict.
Executive represents and warrants that his execution of this Agreement, his
employment with the Company, and the performance of his proposed duties under
this Agreement shall not violate any obligations he may have to any other
employer, person or entity, including any obligations with respect to
proprietary or confidential information of any other person or
entity.
|
II.
|
COMPENSATION
AND BENEFITS
|
A. Base
Salary.
In
consideration of the services to be rendered under this Agreement, the Company
shall pay Executive a salary at the monthly rate of thirty seven thousand
five
hundred dollars ($37,500), less standard payroll deductions and tax withholdings
(“Base
Salary”),
beginning on the Start Date. Upon the completion of one or more debt or equity
financings totaling at least $8 million (a “Qualified
Financing”),
the
Base Salary shall be increased to a monthly rate of fifty thousand dollars
($50,000), less standard payroll deductions and tax withholdings. At the
one-year anniversary of the Start Date, if the Company has completed a Qualified
Financing, Executive shall receive a bonus payment equal to $12,500 times
the
number of months between the Start Date and the date of completion of a
Qualified Financing (prorated for any partial months), to be paid by the
Company
30 days following the one-year anniversary of the Start Date. The Base Salary
shall be paid in accordance with the Company’s normal payroll procedures and
practice. Executive’s Base Salary will be reviewed annually in accordance with
the Company’s compensation review process and may be adjusted (upward, but not
downward) in the sole discretion of the Company.
B. Performance
Bonus. Executive
shall be eligible to participate in an incentive compensation plan to be
established by the Board of Directors, under which Executive shall be eligible
to receive up to one hundred fifty thousand dollars ($150,000) per year,
contingent upon attainment of performance targets to be mutually agreed upon
by
Executive and the Board of Directors, as part of the Company’s annual operating
plan.
C. Stock
Options.
On the
Effective Date, Executive shall be granted non-qualified stock options to
purchase a total of five million
(5,000,000)
shares
of Common Stock of the Company (each such option, an “Option”
and,
collectively, the “Options”).
On
the Effective Date, the Options reflect 8.35% of the outstanding capital
stock
of the Company, on a fully-diluted basis. The exercise price of the Stock
Options shall be: (i) with respect to fifty percent (50%) of the Options,
the
closing price on the Effective Date, and (ii) with respect to the other fifty
percent (50%) of the Options, $0.80 per share, subject to adjustment to the
price per share of the Qualified Financing if the Qualified Financing is
an
equity financing completed at a per share price less than $0.80 per share,
but,
in no event, shall the adjusted price per share be less than the closing
price
on the Effective Date. The Options shall vest monthly over a three-year period,
beginning on the Start Date and subject to Executive’s continuing employment
with the Company. The terms and form of the Options shall be set forth in
a
stock option agreement executed by Executive and the Company, substantially
in
the same form attached as Exhibit
A
hereto.
D. Anti-Dilution
Protection.
The
Company will provide Executive with anti-dilution protection at 8% of the
outstanding capital stock of the Company (on a fully-diluted basis) up to
the
first $10 million of additional equity or convertible debt. Options made
available to Executive as part of this anti-dilution protection will be granted
upon the closing date of the additional capital financing and will be priced
at
the then-current market price. Vesting will be in accordance with the same
vesting schedule as the original option grants specified above such that
on the
grant date, a pro rata portion (based on the percentage of the original option
grant that has vested as of the grant date) of the newly-issued options will
be
fully-vested.
2
E. Benefits.
Executive shall be eligible to participate in the benefits made generally
available by the Company to the Company’s similarly-situated employees, in
accordance with the benefit plans established by the Company, and as may
be
amended from time to time in the Company’s sole discretion. Until such time as
Executive becomes eligible for coverage by the Company’s medical plan, the
Company shall pay the cost of COBRA coverage provided by Executive’s prior
employer.
F. Expenses.
Executive shall be reimbursed for all reasonable business-related travel
and
other expenses incurred by Executive. Executive shall be entitled to incur
expenses for accommodations and travel at the same standard as the President
or
Executive Chairman of the Company.
G. Vacation.
During
the term of this Agreement, Executive shall be entitled to accrue, on a
pro
rata
basis,
twenty (20) paid time off days per year in accordance with the Company’s
standard PTO policy.
H. Indemnity
Agreement.
The
Company and Executive shall enter into an Indemnity Agreement with the Company
in substantially the form attached hereto as Exhibit
B
(the
“Indemnity
Agreement”).
I. Restrictions
on Trading.
During
any 30 calendar day period within six months of the Start Date, Executive
shall
not sell any shares of the Company’s stock that would exceed five percent (5%)
of the aggregate volume of the Company’s stock that was sold in the preceding 25
trading days. After such six month period, Executive agrees to abide by the
trading policy approved by the Board for all of the Company’s senior officers.
Upon termination of the Agreement, Executive may freely dispose of ten percent
(10%) of his shares. With respect to the other ninety percent (90%) of his
shares, Executive shall not sell any shares of the Company’s stock during any 30
calendar day period that would exceed twenty-five percent (25%) of the aggregate
volume of the Company’s stock that was sold in the preceding 25 trading days.
J. Stock
Ownership Guidelines.
During
the Term, Executive will comply with the reasonable corporate officer stock
ownership guidelines (consistent with similarly-situated companies) approved
by
the Board of Directors, as may be amended from time to time, and provided
in
writing to Executive.
K. Legal
Fees. The
Company shall reimburse Executive up to thirty thousand dollars ($30,000)
for
legal fees incurred in the negotiation of this Agreement.
L. Registration
of Shares. The
Company shall use reasonable commercial efforts to cause the shares of Company
common stock to be issued upon the exercise of the Options to be registered
with
the Securities Exchange Commission on Form S-8 within six months of the Start
Date, but in no event shall such filing be completed later than nine months
from
the Start Date.
3
|
III.
|
AT-WILL
EMPLOYMENT; TERMINATION BY
COMPANY
|
A. At-Will
Termination by Company.
Executive’s employment with the Company shall be “at-will” at all times. The
Company may terminate Executive’s employment with the Company at any time,
without any advance notice, for any reason or no reason at all, notwithstanding
anything to the contrary contained in or arising from any statements, policies
or practices of the Company relating to the employment, discipline or
termination of its employees. Upon and after such termination, all obligations
of the Company under this Agreement shall cease, except as otherwise provided
herein.
X. Xxxxxxxxx.
Except
in situations where the employment of Executive is terminated For Cause,
By
Death or By Disability (as defined in Section IV below), in the event that
the
Company terminates the employment of Executive at any time (1) Executive
will be
eligible to receive (a) all compensation, unreimbursed expenses and accrued
and
unused vacation days to which Executive is entitled through the date of
termination, (b) the then-current Base Salary of Executive payable in the
form
of a salary continuation in accordance with the Company’s payroll procedures and
practice for a period of twelve (12) months after such termination (the
“Severance
Period”),
(c)
any annual bonus earned under Section II(B) for a fiscal year prior to the
date
of termination that remains unpaid as of the termination date, payable on
the
date such bonus otherwise would be paid, and (d) a pro rated portion (pro
rated
up to the last day of the month of termination) of any annual bonus payable
to
Executive under Section II(B) hereof, payable on the date such bonus otherwise
would be paid, (2) the Options awarded to Executive will continue to vest
in
accordance with the vesting schedule set forth in Section II(C) above for
the
Severance Period and,
to
the extent unexercised, shall expire two (2) years after such termination,
and
(3) Executive will be entitled to continued coverage, at the Company’s expense,
under all benefit plans in which Executive was participating as of the
termination date until the earlier of (x) the end of the Severance Period
or (y)
the date on which Executive is eligible to receive comparable coverage and
benefits under the same type of plan of a subsequent employer; provided
that in
the event any such benefit plans do not permit coverage of Executive following
employment termination, the Company shall provide the economic equivalent
of the
benefits provided under the plan in which he is unable to participate. In
the
event that Executive is employed by a subsequent employer before the end
of the
Severance Period, then the amount payable under subsection (b) above shall
be
shortened to six (6) months or the length of time between the effective date
of
such termination and the date upon which Executive begins such subsequent
employment, whichever is longer; provided however that if Executive’s salary at
such subsequent employer is lower than the Base Salary, then Executive shall
be
entitled to receive the difference between the Base Salary and Executive’s
salary with such subsequent employer until the end of the twelve month period.
Executive’s eligibility for severance is conditioned on Executive having first
signed a standard release and covenant not to xxx agreement provided by the
Company. Executive shall not be entitled to any severance payments if
Executive’s employment is terminated For Cause, By Death or By Disability (as
defined in Section IV below). Except as set forth in this Section V(B), upon
such termination of employment, all unvested Options not subject to continuing
vesting for the Severance Period shall immediately expire effective as of
the
date of such termination. If Company voluntarily provides more favorable
severance benefits to any other Company employee or officer, or if Company
has
in effect, 60 days after the Effective Date, agreements with employees or
officers containing more favorable severance terms than those contained in
this
Agreement, then Executive will be entitled to receive those more-favorable
severance terms.
4
C. “Change
of Control.” In
the
event of a Change of Control, any unvested Options would become fully vested
immediately prior to the occurrence of the Change of Control. For purposes
of
this Agreement, “Change
of Control”
shall
mean the occurrence of one transaction or a series of related transactions
involving (i) a transfer of securities of the Company or any consolidation
or
merger of the Company with or into any other person or entity, or any other
corporate reorganization or similar transaction or series of related
transactions (including the acquisition of capital stock of the Company),
in
which the stockholders of the Company immediately prior to such transaction,
own, directly or indirectly, capital stock representing directly, or indirectly,
less than fifty percent (50%) of the equity (measured by economic value or
voting power) of the Company or other surviving entity immediately after
such
transaction or (ii) a sale, lease or other disposition of all or substantially
all of the assets of the Company. Notwithstanding the foregoing, a “Change in
Control” shall not include a merger or tender offer conducted within twelve
months of the Effective Date solely for the purpose of a take-private
transaction in connection with the equity financing (and not a sale) of the
Company where the total transaction amount is less than $50 million, provided
that, after such transaction, the shares into which the Options are convertible
into are shares in the same entity and of the same class as the other officers
and directors of the Company.
|
IV.
|
OTHER
TERMINATIONS BY COMPANY
|
A. Termination
for Cause.
For
purposes of this Agreement, “For Cause” shall mean: (i) Executive is convicted
of a felony or a crime involving material dishonesty; (ii) Executive willfully
engages in conduct that is in bad faith and materially injurious to the Company,
including but not limited to, misappropriation of trade secrets, fraud or
embezzlement; (iii) Executive commits a material breach of this Agreement,
which
breach is not cured within twenty days after written notice to Executive
from
the Board; (iv) Executive willfully refuses to implement or follow a lawful
policy or directive of the Board consistent with Executive’s duties and title,
which breach is not cured within twenty days after written notice to Executive
from the Board, or (v) demonstrates a pattern of failing to perform job duties
diligently and professionally and fails to cure such breach within sixty
days
after written notice to Executive from the Board. The Company may terminate
Executive’s employment For Cause at any time, without any advance notice. With
respect to clauses (iii) and (iv) above, grounds For Cause will only exist
after
a finding by the Board of such material breach or failure and the failure
by
Executive to remedy such performance to the Board’s satisfaction within such
20-day period. With respect to clause (v) above, grounds For Cause will only
exist after a finding by the Board of such material breach or failure and
the
failure by Executive to remedy such performance to the Board’s satisfaction
within such 60-day period. The Company shall pay to Executive all compensation,
unreimbursed expenses and accrued and unused vacation days to which Executive
is
entitled up through the date of termination, subject to any other rights
or
remedies of the Company under law; and thereafter all obligations of the
Company
under this Agreement shall cease. Upon such termination of employment, the
unvested Options awarded to Executive shall immediately expire effective
as of
the date of such termination and (ii) the vested Options awarded to Executive,
to the extent unexercised, shall expire one hundred twenty (120) days after
such
termination.
5
B. By
Death.
Executive’s employment shall terminate automatically upon Executive’s death. The
Company shall pay to Executive’s beneficiaries or estate, as appropriate, (a)
all compensation, unreimbursed expenses and accrued and unused vacation days
to
which Executive is entitled through the date of termination, (b) any annual
bonus earned under Section II(B) for a fiscal year prior to the date of
termination that remains unpaid as of the termination date, payable on the
date
such bonus otherwise would be paid, and (c) a pro rated portion (pro rated
up to
the last day of the month of termination) of any annual bonus payable to
Executive under Section II(B) hereof, payable on the date such bonus otherwise
would be paid and all other amounts and benefits specified in this Section
II(B). In addition, the Options awarded to Executive will continue to vest
in
accordance with the vesting schedule set forth in Section II(C) above for
twelve
months from the date of termination and, to the extent unexercised, shall
expire
two (2) years after such termination. Thereafter, the unvested Options awarded
to Executive will immediately expire. Thereafter all obligations of the Company
under this Agreement shall cease. Nothing in this Section shall affect any
entitlement of Executive’s heirs or devisees to the benefits of any life
insurance plan or other applicable benefits. In connection with such termination
of employment, Executive shall also be entitled to receive continued coverage
for Executive’s beneficiaries or estate, as appropriate, under all benefit plans
in which Executive was participating as of the termination date for a period
of
one year following the termination date; provided
that in
the event any such benefit plans do not permit coverage of Executive following
employment termination, the Company shall provide the economic equivalent
of the
benefits provided under the plan in which he is unable to
participate.
C. By
Disability.
If
Executive becomes eligible for the Company’s long term disability benefits or
if, in the opinion of a licensed healthcare professional selected by the
Company, Executive is unable to carry out the responsibilities and functions
of
the position held by Executive by reason of any physical or mental impairment
for more than one hundred twenty consecutive days or more than one hundred
and
eighty days in any twelve-month period, then, to the extent permitted by
law,
the Company may terminate Executive’s employment. The Company shall pay to
Executive (a) all compensation, unreimbursed expenses and accrued and unused
vacation days to which Executive is entitled up through the date of termination,
(b) any annual bonus earned under Section II(B) for a fiscal year prior to
the
date of termination that remains unpaid as of the termination date, payable
on
the date such bonus otherwise would be paid, and (c) a pro rated portion
(pro
rated up to the last day of the month of termination) of any annual bonus
payable to Executive under Section II(B) hereof, payable on the date such
bonus
otherwise would be paid and all other amounts and benefits specified in this
Section II.C, and thereafter all obligations of the Company under this Agreement
shall cease. In addition, the Options awarded to Executive will continue
to vest
in accordance with the vesting schedule set forth in Section II(C) above
for
twelve months from the date of termination and, to the extent unexercised,
shall
expire two (2) years after such termination. Thereafter, the unvested Options
awarded to Executive will immediately expire. Nothing in this Section shall
affect Executive’s rights under any disability plan in which Executive is a
participant. In connection with such termination of employment, Executive
shall
also be entitled to receive continued coverage for Executive under all benefit
plans in which Executive was participating as of the termination date for
a
period of one year following the termination date; provided
that in
the event any such benefit plans do not permit coverage of Executive following
employment termination, the Company shall provide the economic equivalent
of the
benefits provided under the plan in which he is unable to participate. If
the
Executive disagrees with the finding of a disability by the Company-selected
healthcare professional, Executive may submit to the Company the opinion
of a
licensed healthcare professional of his choice. In the event that the medical
opinions of such licensed healthcare professionals conflict, such licensed
healthcare professionals shall appoint a third licensed healthcare professional
to examine the Executive, and the opinion of such third licensed healthcare
professional regarding Executive’s ability to carry out the responsibilities and
functions of his position shall be dispositive for purposes of this
Section.
6
|
V.
|
TERMINATION
BY EXECUTIVE
|
A. At-Will
Termination by Executive.
Executive may terminate employment with the Company at any time for any reason
or no reason at all, upon no less than six (6) weeks advance written notice.
During such notice period Executive shall continue to diligently perform
all of
Executive’s duties hereunder. The Company shall have the option, in its sole
discretion, to make Executive’s termination effective at any time prior to the
end of such notice period as long as the Company pays Executive all
compensation, unreimbursed expenses and accrued and unused vacation days
to
which Executive is entitled up through the last day of the four week notice
period. Thereafter all obligations of the Company shall cease. Upon such
termination of employment, (i) the unvested Options awarded to Executive
shall
immediately expire effective as of the date of such termination and (ii)
the
vested Options awarded to Executive, to the extent unexercised, shall expire
ninety (90) days after such termination.
B. Termination
for Good Reason.
Executive’s termination shall be for “Good Reason” if Executive provides written
notice to the Company of the Good Reason within thirty (30) days of the event
constituting Good Reason and provides the Company with a period of twenty
(20)
days to cure the event constituting Good Reason and the Company fails to
cure
the Good Reason within that period. For purposes of this Agreement,
“Good
Reason”
shall
mean any of the following events if the event is effected by the Company
without
the written consent of Executive: (A) a change in Executive’s title; (B) a
change in Executive’s duties with Employer which materially reduces Executive's
level of responsibility or a requirement that Executive perform services
that
are materially inconsistent with Executive’s position as Chief Executive
Officer; (C) a reduction in Executive’s Base Salary; (D) a requirement that
Executive report to a person or entity other than the Board; or (E) a breach
by
the Company of a material provision of this Agreement. If Executive terminates
his employment for Good Reason, Executive shall receive all of the rights
and
benefits specified in Section III(B) hereof.
|
VI.
|
TERMINATION
OBLIGATIONS
|
A. Return
of Property.
Executive agrees that all property (including without limitation all equipment,
tangible proprietary information, documents, records, notes, contracts and
computer-generated materials) furnished to or created or prepared by Executive
incident to Executive’s employment belongs to the Company and shall be promptly
returned to the Company upon termination of Executive’s employment.
7
B. Resignation
and Cooperation.
Upon
termination of Executive’s employment, Executive shall be deemed to have
resigned from all offices and directorships then held with the Company.
Following any termination of employment, Executive shall reasonably cooperate
with the Company in the winding up of pending work on behalf of the Company
and
the orderly transfer of work to other employees. Executive shall also reasonably
cooperate with the Company in the defense of any action brought by any third
party against the Company that relates to Executive’s employment by the Company.
Any post-termination assistance described in this Section VI(B) shall be
provided at the Company’s sole cost and expense and shall be subject to
Executive’s other commitments.
C. Continuing
Obligations.
Executive understands and agrees that Executive’s obligations under Sections VI,
VII, VIII and IX herein shall survive the termination of Executive’s employment
for any reason and the termination of this Agreement.
|
VII.
|
INVENTIONS
AND CONFIDENTIAL INFORMATION; PROHIBITION ON THIRD PARTY
INFORMATION
|
A. Confidential
Information.
1. Executive
expressly acknowledges that, in the performance of his duties and
responsibilities with the Company, he has been exposed since prior to the
Effective Date, and will be exposed, to the confidential and proprietary
information of the Company, its affiliates and/or its clients, business partners
or customers (“Confidential
Information”).
The
term “Confidential Information” includes information or material that has actual
or potential commercial value to the Company, its affiliates and/or its clients,
business partners or customers and is not generally known to and is not readily
ascertainable by proper means to persons outside the Company, its affiliates
and/or its clients or customers. “Confidential Information” includes the
following, whether or not expressed in a document or medium, regardless of
the
form in which it is communicated, and whether or not marked “trade secret” or
“confidential” or any similar legend: (i) lists of and/or information concerning
(including identities of) customers, prospective customers, suppliers,
employees, consultants, co-venturers and/or joint venture candidates of the
Company, its affiliates or its clients or customers; (ii) non-public information
submitted by customers, prospective customers, suppliers, employees, consultants
and/or co-venturers of the Company, its affiliates and/or its clients or
customers; (iii) non-public information proprietary to the Company, its
affiliates and/or its clients or customers, including, without limitation,
cost
information, profits, sales information, prices, accounting, unpublished
financial information, business plans or proposals, expansion plans (for
current
and proposed facilities), markets and marketing methods, advertising and
marketing strategies, administrative procedures and manuals, the terms and
conditions of the Company’s contracts and trademarks and patents under
consideration, distribution channels, franchises, investors, sponsors and
advertisers; (iv) proprietary technical information concerning products and
services of the Company, its affiliates and/or its clients, business partners
or
customers, including, without limitation, product data and specifications,
diagrams, flow charts, know how, processes, designs, formulae, inventions
and
product development; (v) lists of and/or information concerning applicants,
candidates or other prospects for employment, independent contractor or
consultant positions at or with any actual or prospective customer or client
of
Company and/or its affiliates, any and all confidential processes, inventions
or
methods of conducting business of the Company, its affiliates and/or its
clients, business partners or customers; (vi) acquisition or merger targets;
(vii) business plans or strategies, data, records, financial information
or
other trade secrets concerning the actual or contemplated business, strategic
alliances, policies or operations of the Company or its affiliates; or (viii)
any and all versions of proprietary computer software (including source and
object code), hardware, firmware, code, discs, tapes, data listings and
documentation of the Company; (ix) trade secrets, business and/or financial
secrets and (x) any other confidential information disclosed to Executive
by, or
which Executive obligated under a duty of confidence from, the Company, its
affiliates, and/or its clients, business partners or customers.
8
2. Except
as
authorized in writing by the Board, during the performance of Executive’s duties
and responsibilities for the Company and until such time as any such
Confidential Information becomes generally known to and readily ascertainable
by
proper means to persons outside the Company, its affiliates and/or its clients,
business partners or customers, Executive agrees to keep strictly confidential
and not use for his personal benefit or the benefit to any other person or
entity (other than the Company) the Confidential Information
3. Executive
affirms that he does not possess and will not rely upon the protected trade
secrets or confidential or proprietary information of his prior employer(s)
in
providing services to the Company.
4. In
the
event that Executive’s employment with the Company terminates for any reason,
Executive shall deliver forthwith to the Company any and all originals and
copies of Confidential Information.
9
B. Non-Solicitation.
1. Executive
agrees and acknowledges that by virtue of his position in the Company, he
is
familiar with and in possession of the Company’s trade secrets, customer
information and other Confidential Information which are valuable to the
Company
and that their goodwill, protection and maintenance constitute a legitimate
business interest of the Company, to be protected by the non-competition
restrictions set forth herein. Executive agrees and acknowledges that the
non-competition restrictions set forth herein are reasonable and necessary
and
do not impose undue hardship or burdens on Executive. Executive also
acknowledges that the products and services developed or provided by the
Company, its affiliates and/or its clients or customers are or are intended
to
be sold, provided, licensed and/or distributed to customers and clients in
and
throughout the United States (the “Geographic
Boundary”)
(to
the extent the Company comes to own or operate any material asset in other
areas
of the United States during the term of Executive’s employment, the definition
of Geographic Boundary shall be expanded to cover such other areas), and
that
the Geographic Boundary, scope of prohibited competition, and time duration
set
forth in the non-competition restrictions set forth below are reasonable
and
necessary to maintain the value of the Confidential Information of, and to
protect the goodwill and other legitimate business interests of, the Company,
its affiliates and/or its clients or customers. For this purpose, the Company’s
business includes products and services that target the online youth demographic
based on an internet advertising based business model.
2. The
Executive agrees that the Company will be irreparably damaged if Executive
were
to provide services or to otherwise participate in the business of any person
or
company competing with the Company in violation of this Agreement and any
such
competition by Executive would result in significant loss of goodwill by
the
Company. Therefore, Executive hereby agrees and covenants that he shall not,
without the prior written consent of the Company, directly or indirectly,
in any
capacity whatsoever, including, without limitation, as an employee, employer,
consultant, principal, partner, shareholder, officer, director or any other
individual or representative capacity (other than a holder of less than one
percent (1%) of the outstanding voting shares of any publicly held company),
or
whether on Executive’s own behalf or on behalf of any other person or entity or
otherwise howsoever, during Executive’s employment with the Company and for a
period equal to the greater of one year (two years, if Executive’s employment is
terminated by Executive in accordance with Section V above) following the
termination of this Agreement and Executive’s employment with the Company, in
the Geographic Boundary:
a. Directly
or indirectly through another person recruit, solicit or interfere with,
or
attempt to recruit, solicit, interfere with, any employee, or independent
contractor of the Company to leave the employment (or independent contractor
relationship) thereof, whether or not any such employee or independent
contractor is party to an employment agreement. The Company acknowledges
that
this Section will not be violated by general advertising or general
solicitations that are not targeted or directed specifically to employees
of the
Company, nor by the consideration or acceptance of unsolicited applications
for
employment by such individuals.
b. Interfere
with any relationship, contractual or otherwise, between the Company and
any
other party, including; without limitation, any supplier, co-venturer or
joint
venturer of the Company to discontinue or reduce its business with the Company
or otherwise interfere in any way with the Business of the Company. The
“Business of the Company” includes products that target the online youth
demographic based on an internet advertising based business model.
10
3. Executive
further agrees that for a period of six months following the termination
of this
Agreement and of Executive’s employment, he will not, directly or indirectly,
engage, own, manage, operate, control, be employed by, consult for, participate
in, render services for or be connected in any manner with the ownership,
management, operation or control of any business in competition with the
Business of the Company as defined above.
|
VIII.
|
ARBITRATION
|
Any
dispute, controversy, or claim arising under, out of, in connection with,
or in
relation to this Agreement, or the breach termination, validity or
enforceability of any provision of this Agreement (“Arbitrable
Claims”),
will
be settled by final and binding arbitration conducted in accordance with
and
subject to the Judicial Arbitration and Mediation Service’s (“JAMS”)
then-current JAMS Employment Arbitration Rules and Procedures (the “JAMS
Rules”),
or
such other alternative dispute resolution provider or process agreed by the
parties. Unless otherwise mutually agreed upon by the parties, the arbitration
hearings shall be conducted in San Francisco, California. A single arbitrator
shall be selected in accordance with the JAMS Rules (the “Arbitrator”)
and
the Arbitrator shall allow such discovery as is appropriate, consistent with
the
purposes of arbitration in accomplishing fair, speedy and cost effective
resolution of disputes. Judgment upon the award rendered in any such arbitration
may be entered in any court having jurisdiction thereof, or application may
be
made to such court for a judicial acceptance of the award and an enforcement
of
such award, as the law of such jurisdiction may require or allow. Other than
those matters involving injunctive relief as a remedy that cannot, as a matter
of law, be awarded by the Arbitration, or any action necessary to enforce
the
award of the Arbitrator, the parties agree that the provisions of this Section
VIII are a complete defense to any suit, action, or other proceeding instituted
in any court or before any administrative tribunal with respect to any dispute,
controversy or claim arising under or in connection with this Agreement.
THE
PARTIES HEREBY WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY IN REGARD
TO THE
ARBITRABLE CLAIMS.
|
IX.
|
AMENDMENTS;
WAIVERS; REMEDIES
|
This
Agreement may not be amended or waived except by a writing signed by Executive
and by a duly authorized representative of the Company other than Executive.
Failure to exercise any right under this Agreement shall not constitute a
waiver
of such right. Any waiver of any breach of this Agreement shall not operate
as a
waiver of any subsequent breaches. All rights or remedies specified for a
party
herein shall be cumulative and in addition to all other rights and remedies
of
the party hereunder or under applicable law.
11
|
X.
|
ASSIGNMENT;
BINDING EFFECT
|
A. Assignment.
The
performance of Executive is personal hereunder, and Executive agrees that
Executive shall have no right to assign and shall not assign or purport to
assign any rights or obligations under this Agreement. This Agreement may
be
assigned or transferred by the Company to any successor to all or substantially
all of the business and/or assets of the Company if such successor expressly
assumes and agrees to perform this Agreement in the same manner and to the
same
extent that the Company would be required to perform it if no such succession
had taken place; and nothing in this Agreement shall prevent the consolidation,
merger or sale of the Company or a sale of any or all or substantially all
of
its assets.
B. Binding
Effect.
Subject
to the foregoing restriction on assignment by Executive, this Agreement shall
inure to the benefit of and be binding upon each of the parties; the affiliates,
officers, directors, agents, successors and assigns of the Company; and the
heirs, devisees, spouses, legal representatives and successors of
Executive.
|
XI.
|
NOTICES
|
All
notices or other communications required or permitted hereunder shall be
made in
writing and shall be deemed to have been duly given if delivered: (a) by
hand;
(b) by a nationally recognized overnight courier service; (c) by United States
first class registered or certified mail, return receipt requested, to the
principal address of the other party, as set forth below or (d) by facsimile
(receipt confirmed). The date of notice shall be deemed to be the earlier
of (i)
actual receipt of notice by any permitted means, or (ii) five business days
following dispatch by overnight delivery service or the United States Mail.
Executive shall be obligated to notify the Company in writing of any change
in
Executive’s address. Notice of change of address shall be effective only when
done in accordance with this paragraph.
Company’s
Notice Address:
GoFish
Corporation
000
Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx
Xxxxxxxxx, Xxxxxxxxxx, 00000
Facsimile:
(000) 000-0000
Executive’s
Notice Address:
Xxxx
Xxxxxxx
[ADDRESS
OMITTED]
Facsimile:
_______________
With
a
copy to:
Frankfurt
Kurnit Xxxxx & Xxxx, PC
000
Xxxxxxx Xxxxxx, 00xx
xxxxx
Xxx
Xxxx, XX 00000
Attn.:
Xxxxxxx Xxxxxx
Facsimile:
(000) 000-0000
12
|
XII.
|
SEVERABILITY
|
If
any
provision of this Agreement shall be held by a court or arbitrator to be
invalid, unenforceable, or void, such provision shall be enforced to the
fullest
extent permitted by law, and the remainder of this Agreement shall remain
in
full force and effect. In the event that the time period or scope of any
provision is declared by a court or arbitrator of competent jurisdiction
to
exceed the maximum time period or scope that such court or arbitrator deems
enforceable, then such court or arbitrator shall reduce the time period or
scope
to the maximum time period or scope permitted by law.
|
XIII.
|
TAXES
|
All
amounts paid under this Agreement (including without limitation Base Salary
or
Severance) shall be paid less all applicable state and federal tax withholdings
and any other withholdings required by any applicable jurisdiction.
The
Company shall delay the payment of any amounts under this Agreement to the
extent necessary to comply with Section 409A(a)(2)(B)(i) of the Internal
Revenue
Code (relating to payments made to certain “specified employees” of certain
publicly-traded companies); in such event, any payment to which Executive
would
otherwise be entitled during the six (6) month period following the date
of
Executive’s termination of employment will be payable on the first business day
following the expiration of such six (6) month period.
If
the
receipt by the Executive of any payments, awards, grants or other amounts
or
benefits pursuant to the terms of this Agreement (“Initial Amount”) result in a
tax under Sections 409A or 4999 of the Internal Revenue Code, or both, the
Company shall pay the Executive an additional amount (the “Gross Up Amount”) so
that, after the reduction of tax (i) under those Sections (and corresponding
provisions of state and local law) on the Initial Amount and the Gross Up
Amount
and (ii) any US federal, state and local income or payroll tax on the Gross
Up
Amount, the amount retained by the Executive is equal to the Initial Amount
before any US federal, state or local income or payroll tax on the Initial
Amount.
|
XIV.
|
GOVERNING
LAW
|
This
Agreement shall be governed by and construed in accordance with the laws
of the
State of California.
13
|
XV.
|
INTERPRETATION
|
This
Agreement shall be construed as a whole, according to its fair meaning, and
not
in favor of or against any party. Sections and section headings contained
in
this Agreement are for reference purposes only, and shall not affect in any
manner the meaning or interpretation of this Agreement. Whenever the context
requires, references to the singular shall include the plural and the plural
the
singular.
|
XVI.
|
COUNTERPARTS
|
This
Agreement may be executed in any number of counterparts, each of which shall
be
deemed an original of this Agreement, but all of which together shall constitute
one and the same instrument.
|
XVII.
|
AUTHORITY
|
Each
party represents and warrants that such party has the right, power and authority
to enter into and execute this Agreement and to perform and discharge all
of the
obligations hereunder; and that this Agreement constitutes the valid and
legally
binding agreement and obligation of such party and is enforceable in accordance
with its terms.
|
XVIII.
|
ENTIRE
AGREEMENT
|
This
Agreement is intended to be the final, complete, and exclusive statement
of the
terms of Executive’s employment by the Company and may not be contradicted by
evidence of any prior or contemporaneous statements or agreements, except
for
agreements specifically referenced herein (including the Indemnity Agreement
and
any applicable stock option agreement, applicable restricted stock unit
agreement or other similar Company plan document). To the extent that the
practices, policies or procedures of the Company, now or in the future, apply
to
Executive, and to the extent that any applicable stock option agreement,
applicable restricted stock unit agreement or similar Company plan document,
are
inconsistent with the terms of this Agreement, the provisions of this Agreement
shall control. Any subsequent change in Executive’s duties, position, or
compensation will not affect the validity or scope of this
Agreement.
|
XIX.
|
EXECUTIVE
ACKNOWLEDGEMENT
|
EXECUTIVE
ACKNOWLEDGES THAT HE HAS HAD THE OPPORTUNITY TO CONSULT LEGAL COUNSEL CONCERNING
THIS AGREEMENT, THAT HE HAS READ AND UNDERSTANDS THE AGREEMENT, THAT HE IS
FULLY
AWARE OF ITS LEGAL EFFECT, AND THAT HE HAS ENTERED INTO IT FREELY BASED ON
HIS
OWN JUDGMENT AND NOT ON ANY REPRESENTATIONS OR PROMISES OTHER THAN THOSE
CONTAINED IN THIS AGREEMENT.
14
IN
WITNESS WHEREOF,
the
parties have duly executed this Agreement as of the date first written
above.
|
Xxxx
Xxxxxxx
|
|
|
By:_________________________________
|
_________________________________
|
|
Name:
|
|
|
Title:
|
15
