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Exhibit 10.1
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is entered into as of this
15th day of October 1999 (the "Effective Date"), by and between, XxxxxXxxxx.xxx
Inc., a Nevada corporation (the "Company") and Xxxxx Xxxxxxx, an individual with
a mailing address at
____________________________________________________ ("Executive")
INTRODUCTION
Executive possesses skills and knowledge advantageous to the Company.
The Company desires to employ Executive and Executive desires to accept such
employment on the terms and conditions set forth herein.
AGREEMENT
In consideration of the premises and mutual promises hereinbelow set
forth, the parties hereby agree as follows:
1. EMPLOYMENT; DUTIES. Subject to the terms and conditions set
forth herein, the Company hereby employs Executive during the Employment Period
(as defined below), and Executive hereby accepts such employment. Executive
agrees to be a full-time employee of the Company and devote his full and
exclusive time, energy, skill and best efforts to the business of the Company
and to the fulfillment of Executive's duties hereunder. Executive's duties
include, but are not limited to, (i) serving as Chairman and Chief Executive
Officer of the Company; (ii) sales of the Company's and its affiliates products
and services; (iii) assisting in the internal growth of the Company's business;
and (iv) other duties assigned to Executive by the Company from time to time
consistent with Executive's position.
2. EMPLOYMENT PERIOD. The term of this Agreement (the
"Employment Period") shall commence on the Effective Date and shall be
guaranteed for a period of three (3) years thereafter. If Company desires to
terminate Executive earlier pursuant to SECTION 4 or SECTION 5 below, all
amounts due to or accrued on behalf of Executive, in accordance with the terms
of SECTION 3 becomes due immediately upon the effectiveness of such termination.
3. COMPENSATION AND BENEFITS
3.1 SALARY. During the Employment Period, the Company
agrees to pay Executive at the rate of $100,000 per year ("Base Salary").
Executive's salary shall be subject to customary withholdings and is payable to
Executive on the regularly occurring pay period established by the Company. Base
Salary is guaranteed by the Company to the Executive for the Employment Period.
3.2 HEALTH BENEFITS. During the Employment Period,
the Company shall provide Executive with individual and/or family healthcare,
dental, disability, and eyecare coverage, as provided by health care provider(s)
selected by the Company from time to time.
3.3 BONUS. During the Employment Period, Executive
shall be paid a bonus at the end of each fiscal year equal to the sum of (i)
2.5% of the Company's increase in "annual sales" and (ii) 5.0% of the Company's
increase in "EBITDA" (i.e., earnings before interest and taxes, less
depreciation and amortization). Such bonus (if any) shall be payable at the
discretion of the Company in either (A) cash or (B) common stock, options or
other awards from Company's incentive stock plan, subject to applicable
securities law and tax withholding payments by Executive. The calculation for
such bonus shall (w) be based on the unconsolidated financial statements of the
Company as certified by the Company's certified public accountants; (x) be
subject to allocation of overhead provisions from time to time adopted by the
Company and its subsidiaries; (y) include sales and earnings from new services
offered; and (z) include sales and earnings from new services offered resulting
from an expansion approved by the Company, or as a result of additional services
made available by the Company; and shall exclude, without limitation, any
earnings or sales generated by way of merger, acquisition or other similar
event.
3.4 RETIREMENT PLAN. During the Employment Period,
Executive shall
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be entitled to participate in any 401(k) or similar plan adopted by the Company
for the benefit of its Executives. The Company reserves the right to modify,
terminate or withdraw any such plan (if so adopted) at any time in its sole
discretion.
3.5 INCENTIVE BONUS. Executive will be paid an
incentive bonus equal to 2.0% of the total purchase price for each company that
Executive introduces to the Company and is subsequently acquired by the Company,
payable at the Company's discretion in either (i) cash or (ii) common stock,
stock options or other awards from the Company's incentive stock option plan,
subject to applicable securities law and tax withholding payments by Executive.
Executive will be required to submit any referral in writing for acknowledgment
by the Company prior to any negotiations between the Company and the referral.
Executive acknowledges that other persons or entities, (including other
employees, officers, and directors of the Company and its affiliates), have been
or may be offered a similar "incentive bonus" and that any incentive bonus which
Executive may be entitled to hereunder is subject to a percentage reduction to
the extent that other persons or entities participated in or were responsible
for the referral. Any dispute regarding apportionment of an incentive bonus
shall be resolved by binding arbitration in accordance with Section 13 hereof.
In no event shall the Company pay more than a total of 2% for any single
acquisition transaction.
3.6 OTHER BENEFITS. During the Employment Period,
Executive shall be entitled to an annual expense account to be used for
reimbursement of reasonable and necessary business expenses. Such expense
account shall not exceed $10,000 annually.
4. TERMINATION BY THE COMPANY FOR CAUSE. Upon written notice
to Executive, the Company may terminate this Agreement for cause if any of the
following events shall occur: (i) any breach of this Agreement by Executive;
(ii) the commission of a felony by Executive; (iii) the commission of an act by
Executive involving fraud, theft or dishonesty; or (iv) the Company's bona fide
decision to terminate its business and liquidate its assets. In the event of a
termination pursuant to this Section 4, all non-financial obligations of the
Company under this Agreement shall cease.
5. TERMINATION WITHOUT CAUSE.
5.1 BY EMPLOYER. The Company may terminate this
Agreement at any time without cause upon thirty (30) days written notice to
Executive. In such event, the Company shall pay Executive during regular payroll
periods (less customary withholding taxes) the Base Salary for up to the greater
of twelve (12) months or the remainder of the Employment Period. All other
obligations of the Company shall be prorated to the date of termination.
5.2 BY EXECUTIVE. Executive may terminate this
Agreement at any time upon ninety (90) days prior written notice to the Company.
In such event, all financial and non-financial obligations of the Company to the
Executive shall cease.
6. CONFIDENTIALITY AND NON-DISCLOSURE. Executive recognizes
and acknowledges that he has had in the past, currently has and in the future
may have access to certain confidential information relating to the Company and
its affiliates, including, but not limited to, operational policies, financial
information, marketing information, personnel information, trade secrets,
customer information (including customer lists), and pricing and cost policies,
that are valuable, special and unique assets of the Company (collectively,
"Confidential Information"). Executive agrees that he will not use or disclose
such Confidential Information to any person, firm, corporation, association or
other entity for any purpose or reason whatsoever, except as is required in the
course of performing his duties hereunder unless (i) such information becomes
known to the public generally through no breach by Executive of this covenant or
(ii) disclosure is required by law or any governmental authority or is required
in connection with the defense of a lawsuit against the disclosing party,
provided, that prior to disclosing any information pursuant to this clause (ii),
Executive shall give prior written notice thereof to the Company and provide the
Company with the opportunity to contest such disclosure. Executive agrees that,
both during the Employment Period and after the termination of this Agreement,
Executive will hold in a fiduciary capacity for the benefit of the Company, and
shall not directly or indirectly use or disclose, except as authorized by the
Company in connection with the performance of Executive's duties, any
Confidential Information, that Executive may have or may acquire (whether or not
developed or compiled by Executive and whether or not Executive has been
authorized to have access to such Confidential Information) during
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the term of this Agreement. The covenants contained in this SECTION 6 shall
survive for the Employment Period and for a period of one (1) year thereafter;
provided, however, that with respect to those items of Confidential Information
which constitute trade secrets under applicable law, Executive's obligations of
confidentiality and non-disclosure as set forth in this SECTION 6 shall continue
to survive after the applicable period above to the greatest extent permitted by
applicable law. These rights of the Company are in addition to those rights the
Company has under the common law or applicable statutes for the protection of
trade secrets.
7. NON-COMPETITION. Executive expressly covenants and agrees
that for the Employment Period and for a period of one (1) year thereafter, he
shall not, directly or indirectly, seek, obtain or accept a "Competitive
Position" in the "Restricted Territory" with a "Competitor" of the Company (as
such terms are hereafter defined) . For purposes of this Agreement, a
"Competitor" of the Company means any business, individual, partnership, joint
venture, association, firm, corporation or other entity engaged, wholly or
partly, in the business of selling internet access service, creating
multi-lingual online communities or multi-lingual internet portals. "Restricted
Territory" means each state of the United States of America; a "Competitive
Position" means any employment with any Competitor of the Company. Nothing
contained in this SECTION 7 is intended to prevent Executive from investing in
stock or other securities listed on a national securities exchange or actively
traded on the over the counter market or any corporation engaged, wholly or
partly, in the sale of products or services on the internet.
8. NON-SOLICITATION OF CUSTOMERS. Executive agrees that he
will not take any customer lists of the Company after leaving his employ and
that he will, for the Employment Period and for a period of one (1) year
thereafter, refrain from soliciting or attempting to solicit directly or by
assisting others, any business from any of the Company's customers, including
actively sought prospective customers, with whom Executive had "material contact
during the employment for purposes of providing products or services.
9. TOLLING OF PERIOD OF RESTRAINT. Executive hereby expressly
acknowledges and agrees that in the event the enforceability of any of the terms
of this Agreement shall be challenged in court and Executive is not enjoined
from breaching any of the restraints set forth in SECTION 6 through SECTION 9,
then if a court of competent jurisdiction finds that the challenged restraint is
enforceable, the time period of the restraint shall be deemed tolled upon the
filing of the lawsuit challenging the enforceability of the restraint until the
dispute is finally resolved and all periods of appeal have expired.
10. ACKNOWLEDGEMENTS. Executive hereby acknowledges and agrees
that the restrictions contained in SECTION 6 through SECTION 9 are fair and
reasonable and necessary for the protection of the legitimate business interests
of the Company. Executive acknowledges that in the event Executive's employment
with the Company terminates for any reason, Executive will be able to earn a
livelihood without violating the restrictions contained in SECTION 6 through
SECTION 9 and that Executive's ability to earn a livelihood without violating
such restrictions is a material condition to Executive's employment and
continued employment with the Company. Executive expressly agrees that the
character, duration and geographical scope of the covenants contained in this
SECTION 6 through SECTION 9 are reasonable in light of the circumstances as they
exist at the date upon which this Agreement has been executed. However, should a
determination nonetheless be made by a court of competent jurisdiction at a
later date that the character, duration or geographical scope of the covenants
contained herein are unreasonable in light of the circumstances as they then
exist, then it is the intention of both Executive and the Company that these
covenants shall be construed by the court in such a manner as to impose only
those restrictions on the conduct of Executive which are reasonable in light of
the circumstances as they then exist and necessary to assure the Company of the
intended benefit of these covenants.
11. RIGHTS TO MATERIALS; WORK FOR HIRE. All records, files,
memoranda, reports, price lists, customer lists, drawings, plans, sketches,
documents and the like (together with all copies thereof) relating to the
business of the Company, which Executive shall use or prepare or come in contact
with in the course of, or as a result of, his employment shall, as between the
parties hereto, remain the sole property of the Company. Upon the termination of
Employment or upon the prior demand of the Company, Executive shall immediately
return all such materials and shall not thereafter cause removal
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thereof from the premises of the Company. Executive agrees to disclose and
assign to the Company as its exclusive property, all ideas, writings,
inventions, discoveries, improvements and technical or business innovations made
or conceived by Executive, whether or not patentable or copyrightable, either
solely or jointly with others during the Employment Period and for a period of
six months (6) thereafter whether or not made or conceived during regular hours
of work or otherwise, which are along the lines of the business, work or
investigations of the Company or its affiliates. Executive agrees to execute any
and all documents hereafter requested by the Company necessary to further
effectuate the foregoing.
12. REMEDIES. Without limiting the Company's right to claim
damages, Executive acknowledges that the Company will be irreparably harmed by a
breach of any provision of this Agreement and Executive agrees that the Company
shall be entitled to injunctive relief in the event of such breach.
13. GOVERNING LAW; ARBITRATION; JURISDICTION; VENUE;
ATTORNEY'S FEES. This Agreement is made and entered into in and shall be
governed by and interpreted in accordance with the laws of, the State of Nevada.
The Company and Executive agree that any dispute regarding this Agreement shall
be submitted to arbitration to and shall be resolved in accordance with the
rules of the JAMS/Endispute for expedited cases then in effect. The
arbitrator(s) shall be mutually selected by the parties or in the event the
parties cannot mutually agree, then appointed by JAMS/Endispute. Any arbitration
shall be held within a thirty (30) mile radius of Mahwah, NJ and the
arbitrator(s) shall apply Nevada law. Judgment upon any award rendered by the
arbitrator(s) shall be final and may be entered in any court of competent
jurisdiction. Notwithstanding the foregoing, the Company shall have the absolute
right to obtain equitable remedies in any state court of competent jurisdiction
in the State of Nevada. By his execution and delivery of this agreement,
Executive irrevocably submits to and accepts the exclusive jurisdiction of each
of such courts and waives any objection (including any objection to venue or any
objection based upon the grounds of forum non conveniens) which might be
asserted against the bringing of any such action, suit or other legal proceeding
in such courts. The court and/or arbitrator(s) shall award costs and expenses
(including reasonable attorney's fees) to the prevailing party in any litigation
or arbitration.
14. MISCELLANEOUS
14.1. ENTIRE AGREEMENT. This Agreement constitutes
the entire agreement between the parties hereto with respect to the subject
matter hereof and supersedes any and all previous agreements, written and oral,
regarding the subject matter hereof between the parties hereto. This Agreement
shall not be changed, altered, modified or amended, except by a written
agreement signed by both parties hereto.
14.2. ASSIGNMENT. The Company may assign this
Agreement to (i) any entity controlling, controlled by or under common control
with the Company or (ii) to any purchaser of the Company's assets provided that
such purchaser agrees to assume the Company's obligations hereunder.
14.3. WAIVER. The failure of any party to insist in
any one instance or more upon strict performance of any of the terms and
conditions hereof, or to exercise any right or privilege herein conferred, shall
not be construed as a waiver of such terms, conditions, rights or privileges,
but same shall continue to remain in full force and effect. Any waiver by any
party of any violation of, breach of or default under any provision of this
Agreement by the other party shall not be construed as, or constitute, a
continuing waiver of such provision, or waiver of any other violation of, breach
of or default under any other provision of this Agreement.
14.4. TITLES; GENDER. Section and subsection titles
are for convenience of reference only and are not to be considered in the
interpretation or construction of any of the provisions hereof. All pronouns or
any variations thereof contained in this Agreement refer to the masculine,
feminine or neuter as the identity of the person may require.
14.8. SURVIVAL. SECTION 6 through SECTION 14 hereof
shall survive any termination of this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
COMPANY:
ATTEST: XxxxxXxxxx.xxx, Inc.
By:_________________________________
Xxxxx Xxxxx, President
WITNESS EXECUTIVE:
By:_________________________________
Name: ______________________________
