EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into
this 1st day of November, 1999, by and between ENTERTAINMENT BOULEVARD, INC.
("Company"), a Nevada corporation, and XXXXXXX XXXXX ("Employee"), with
reference to the following facts:
WHEREAS, Company wishes to employ Employee as a full-time employee
of Company, and Employee wishes to accept such employment, upon the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the terms and conditions and
the mutual agreements and covenants set forth herein, the parties hereto
agree as follows:
1. SCOPE OF EMPLOYMENT.
1.1 CAPACITY. Company hereby agrees to employ Employee, and
Employee hereby accepts such employment, as President and Chief Executive
Officer of Company during the term of this Agreement. Employee shall report
to the Board of Directors of Company and perform the services and duties
customarily incident to such office and as otherwise decided upon by the
Board of Directors.
1.2 DEVOTION OF SERVICES. Employee shall be a full-time
employee of Company during the term of this Agreement. Employee shall not
participate in any activities which may interfere with his duties hereunder
and/or which are competitive with Employer's activities (except as the owner
of less than 2% of the issued and outstanding capital stock of a publicly
traded corporation). Employee shall perform and discharge well and
faithfully those duties assigned him by Company.
2. TERM. Subject to Section 6 herein, the term of this Agreement
shall commence as of November 1, 1999, and shall continue and remain in full
force and effect for a period of two (2) years. However, in the event that
Company thereafter continues to employ Employee, this Agreement shall be
deemed automatically renewed upon the same terms and conditions set forth
herein except (a) that the parties may mutually agree to revise any of the
terms set forth herein, and (b) the employment relationship will be on an "at
will" basis, which means that, subject to Section 6.4 herein, either Company
or Employee may elect to terminate the employment relationship at any time
for any reason whatsoever, with or without cause. Employee acknowledges that
no representation has been made by Company as to any minimum or specified
term or length of employment following the term set forth above.
3. COMPENSATION.
3.1 SALARY AND BONUS. In consideration of the services to be
rendered by Employee hereunder, including without limitation any services
rendered as an officer or director of Company or any subsidiary or affiliate
thereof, during the term of this Agreement Company shall pay to Employee the
following:
(a) A salary in the amount of $240,000.00 per annum. The
Board of Directors may, at its sole and absolute discretion, increase
Employee's salary; provided, however, Employee's annual salary shall be
increased at the end of each twelve (12) month period by at least 15% over
the previous year.
(b) The Company's Board of Directors may, but shall not be
obligated to, award bonuses to Employee based upon his performance and the
Company's profitability.
(c) All payments to Employee shall be subject to the regular
withholding requirements of all appropriate governmental taxing authorities.
3.2 OTHER BENEFITS. Employee shall be entitled to
participate in any medical and insurance plan which Company is presently
providing or may provide to its senior executives. Employee acknowledges
that the terms of such plans may change from time to time.
3.3 EXPENSES. Company will advance to or reimburse Employee
for all reasonable travel and entertainment required by Company and other
reasonable expenses incurred by Employee in connection with the performance
of his services under this Agreement in accordance with Company policy as
established from time to time. In addition, Employee shall receive an
automobile lease allowance of $1,500.00 per month and, in addition, Company
shall pay for gas, maintenance and repairs of said automobile.
3.4 OPTIONS. At the end of each twelve (12) month period,
Company shall grant a minimum of 50,000 options to Employee pursuant to
Company's Stock Option Plan.
4. INVENTIONS.
4.1 RIGHT TO INVENTIONS. Employee agrees that any
discoveries, inventions or improvements of whatever nature (collectively
"Inventions") made or conceived by Employee, solely or jointly with others,
during the term of his employment with Company, that relate, at the time of
conception of or reduction to practice, to the business of Company or
Company's actual or demonstrably anticipated research or development; or that
result from any work performed by Employee for Company, shall belong to
Company. Employee also agrees that Company shall have the right to keep any
such Inventions as trade secrets, if Company so chooses.
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4.2 ASSIGNMENT OF INVENTIONS AND PATENTS. In furtherance of,
and not in contravention, limitation and/or in place of, the provisions of
Section 4.1 above, Company hereby notifies Employee of California Labor Code
Section 2870, which provides:
"Any provision in an employment agreement which provides that an
employee shall assign or offer to assign any of his or her rights in
an invention to his or her employer shall not apply to an invention
for which no equipment, supplies, facility, or trade secret
information of the employer was used and which was developed entirely
on the employee's own time, and (a) which does not relate (1) directly
or indirectly to the business of the employer or (2) to the employer's
actual or demonstrably anticipated research or development, or (b)
which does not result from any work performed by the employee for the
employer. Any provision which purports to apply to such an invention
is to that extent against the public policy of this state and is to
that extent void and unenforceable."
Employee acknowledges that he has been notified by the Company of
this law, and understands that this Agreement does not apply to Inventions
which are otherwise fully protected under the provisions of said Labor Code
Section 2870. Therefore, Employee agrees to promptly disclose in writing to
the Company all Inventions, whether Employee personally considers them
patentable or not, which Employee alone, or with others, conceives or makes
during his employment with Company or as is otherwise required and set forth
under Section 4.1 above. Company shall hold said information in strict
confidence to determine the applicability of California Labor Code Section
2870 to said Invention and, to the extent said Section 2870 does not apply,
Employee hereby assigns and agrees to assign all his right, title and
interest in and to those Inventions which relate to business of the Company
and Employee agrees not to disclose any of these Inventions to others without
the prior written express consent of Company. Employee agrees to notify
Company in writing prior to making any disclosure or performing any work
during the term of his employment with Company which may conflict with any
proprietary rights or technical know-how claimed by Employee as his property.
In the event Employee fails to give Company notice of such conflict,
Employee agrees that Employee shall have no further right or claim with
respect to any such conflicting proprietary rights or technical know-how.
5. CONFIDENTIALITY.
5.1 RESTRICTIONS ON USE OF TRADE SECRETS AND RECORDS. During
the term of his employment, Employee will have access to and become acquainted
with various trade secrets of Company, consisting of formulas, patterns,
devices, secret Inventions, processes, compilations of information, records and
specifications (collectively "Trade Secrets"), all of which are owned by Company
and used in the operation of Company's business. Additionally, Employee will
have access to and may become acquainted with various files, records, customer
lists, documents, drawings, specifications, equipment and similar items relating
to the business of Company (collectively "Confidential Information"). All such
Trade Secrets and Confidential Information, whether they are designed, conceived
or prepared by Employee or come into Employee's possession
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or knowledge in any other way, are and shall remain the exclusive property of
Company and shall not be removed from the premises of Company under any
circumstances whatsoever without the prior written consent of Company.
Employee promises and agrees that he will not use for himself or for others,
or divulge or disclose to any other person or entity, directly or indirectly,
either during the term of his employment by Company or at any time
thereafter, for his own benefit or for the benefit of any other person or
entity or for any reason whatsoever, any of the Trade Secrets or Confidential
Information described herein, which he may conceive, develop, obtain or learn
about during or as a result of his employment by Company unless specifically
authorized to do so in writing by Company.
5.2 NON-INTERFERENCE. Employee recognizes that Company has
invested substantial effort in assembling its present employees and in
developing its customer base. As a result, and particularly because of
Company's many types of confidential business information, Employee
understands that any solicitation of a customer or employee of Company, in an
effort to get them to change business affiliations, would presumably involve
a misuse of Company's confidences, Trade Secrets and Confidential
Information. Employee therefore agrees that, for a period of one (1) year
from the later of the date of termination of Employee's employment with
Company for any reason whatsoever or the receipt by Employee of any
compensation paid to Employee by Company, Employee will not influence, or
attempt to influence, existing employees or customers of Company in an
attempt to divert, either directly or indirectly, their services or business
from Company.
6. TERMINATION OF AGREEMENT.
6.1 TERMINATION BY COMPANY. Company may terminate Employee's
employment hereunder at any time for cause without payment of severance or
similar benefits. For purposes of this Section 6.1, "cause" shall mean the
following events: (a) any willful breach of duty by Employee in the course of
his employment, (b) the breach of any provision of this Agreement or any
misrepresentation by Employee hereunder, (c) misconduct, neglect or negligence
in the performance of Employee's duties and obligations, (d) disloyal,
dishonest, willful misconduct, illegal, immoral or unethical conduct by
Employee, (e) such carelessness or inefficiency in the performance of his
duties that Employee is unfit to continue in the service of Company, (f)
failure of Employee to comply with the policies or directives of Company
and/or failure to take direction from Company's Board of Directors, or (g)
such other conduct which is substantially detrimental to the best interests
of Company. Any such termination shall become effective upon delivery of
written notice to Employee.
6.2 TERMINATION BY EMPLOYEE. Employee may terminate his
employment hereunder at any time for cause. For purposes of this Section
6.2, "cause" shall mean the breach of any provision of this Agreement by
Company which is not cured within thirty (30) days after Employee delivers
written notice to the Company's Board of Directors describing such breach.
If the breach is not so cured within such thirty (30) days after delivery of
such notice, the termination of employment shall become effective after the
expiration of such cure period.
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6.3 DEATH OR DISABILITY. Employee's employment with Company
shall cease upon the date of his death. In the event Employee becomes
physically or mentally disabled so as to become unable for more than one
hundred eighty (180) days in the aggregate in any twelve (12) month period to
perform his duties on a full-time basis with reasonable accommodations,
Company may, at its sole discretion, terminate this Agreement and Employee's
employment.
6.4 TERMINATION FOLLOWING AUTOMATIC RENEWAL. In the event
that this Agreement is automatically renewed pursuant to Paragraph 2 herein,
either Company or Employee may terminate Employee's employment hereunder at
any time and for any reason whatsoever, with or without cause, upon thirty
(30) days prior written notice delivered to the other party.
6.5 EFFECT OF TERMINATION. Upon the termination of
Employee's employment hereunder or the expiration or termination of the
Agreement,(a) Company shall pay Employee all compensation accrued and
outstanding as of the date of such termination or expiration, and (b)
notwithstanding anything to the contrary contained herein, the rights and
obligations of each party under Paragraphs 4, 5 and 8 herein shall survive
such termination or expiration. Notwithstanding anything to the contrary
contained in this Agreement, if, prior to the end of the initial two (2) year
term, Employer terminates this Agreement without cause, Employee shall
continue to be entitled to receive all of the compensation and other benefits
provided for in Paragraph 3 for the remainder of said two (2) year term
without any deduction or offset for any compensation earned or received by
Employee from any other sources.
7. EMPLOYEE'S REPRESENTATIONS. As an inducement for Company to
execute this Agreement, Employee represents and warrants to Company that the
negotiation, execution and delivery of this Agreement by Employee together
with the performance of his obligations hereunder does not breach or give
rise to a breach under any employment, confidentiality, non-disclosure,
non-competition or any other agreement, written or oral, to which Employee is
a party.
8. EQUITABLE REMEDIES.
8.1 INJUNCTIVE RELIEF. Employee acknowledges and agrees that
the covenants set forth in Paragraphs 4 and 5 herein are reasonable and
necessary for protection of Company's business interests, that irreparable
injury will result to Company if Employee breaches any of the terms of said
covenants and that, in the event of Employee's actual or threatened breach of
said covenants, Company will have no adequate remedy at law. Employee
accordingly agrees that in the event of actual or threatened breach of any of
such covenants, Company shall be entitled to immediate injunctive and other
equitable relief, without bond and without the necessity of showing actual
monetary damages. Nothing contained herein shall be construed as prohibiting
Company from pursuing any other remedies available to it for such breach or
threatened breach, including the recovering of any damages which it is able
to prove. Each of the covenants in Paragraphs 4 and 5 shall be construed as
independent of any other covenants or provisions of this Agreement. In the
event of any judicial determination that any of the covenants set forth in
Paragraphs 4 and 5 herein
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or any other provisions of the Agreement are not fully enforceable, it is the
intention and desire of the parties that the court treat said covenants as
having been modified to the extent deemed necessary by the court to render
them reasonable and enforceable and that the court enforce them to such
extent.
8.2 SPECIFIC ENFORCEMENT. Employee agrees and acknowledges
that he is obligated under this Agreement to render services of a special,
unique, unusual, extraordinary and intellectual character, thereby giving
this Agreement peculiar value, so that the loss thereof could not be
reasonable or adequately compensated in damages in an action at law.
Therefore, in addition to other remedies provided by law, Company shall have
the right, during the term of this Agreement, to obtain specific performance
hereof by Employee and to obtain injunctive relief against the performance of
service elsewhere by Employee during the term of this Agreement.
9. GENERAL.
9.1 ENTIRE AGREEMENT. This Agreement contains the entire
understanding between the parties hereto and supersedes all other oral and
written agreements or understandings between them.
9.2 AMENDMENT. This Agreement may not be modified, amended,
altered or supplemented except by written agreement between Employee and
Company.
9.3 COUNTERPARTS. This Agreement may be executed in two (2)
or more counterparts, each of which shall be deemed an original but all of
which together shall constitute one and the same instrument.
9.4 JURISDICTION. Each party hereby consents to the
exclusive jurisdiction of the state and federal courts sitting in Los Angeles
County, California, in any action on a claim arising out of, under or in
connection with this Agreement or the transactions contemplated by this
Agreement. Each party further agrees that personal jurisdiction over him may
be effected by service of process by registered or certified mail addressed
as provided in Section 9.9 herein, and that when so made shall be as if
served upon him personally within the State of California.
9.5 EXPENSES. In the event an action at law or in equity is
required to enforce or interpret the terms and conditions of this Agreement,
the prevailing party shall be entitled to reasonable attorney's fees and
costs in addition to any other relief to which that party may be entitled.
9.6 INTERPRETATION. The headings herein are inserted only as
a matter of convenience and reference, and in no way define, limit or
describe the scope of this Agreement or the intent of any provisions thereof.
No provision of this document is to be interpreted for or against any party
because that party or party's legal representative drafted it.
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9.7 SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon, and inure to the benefit of, the parties hereto and their heirs,
successors, assigns and personal representatives. As used herein, the
successors of Company shall include, but not be limited to, any successor by
way of merger, consolidation, sale of all or substantially all of its assets
or similar reorganization. In no event may Employee assign any rights or
duties under this Agreement.
9.8 CONTROLLING LAW; SEVERABILITY. The validity and
construction of this Agreement or of any of its provisions shall be
determined under the laws of the State of California. Should any provision
of this Agreement be invalid either due to the duration thereof or the scope
of the prohibited activity, such provision shall be limited by the court to
the extent necessary to make it enforceable and, if invalid for any other
reason, such invalidity or unenforceability shall not affect or limit the
validity and enforceability of the other provisions hereof.
9.9 NOTICES. Any notice required or permitted to be given
under this Agreement shall be sufficient if in writing and if personally
received by the party to whom it is sent or delivered, or if sent by
registered or certified mail, postage prepaid, to Employee's residence in the
case of notice to Employee, or to its principal office if to Company. A
notice is deemed received or delivered on the earlier of the day received or
three (3) days after being sent by registered or certified mail in the manner
described in this Section.
9.10 WAIVER OF BREACH. The waiver by any party hereto of a
breach of any provision of this Agreement shall not operate or be construed
as a waiver of any subsequent breach.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the day and year first above written.
ENTERTAINMENT BOULEVARD, INC.
By: /s/ Xxxxxxx Xxxxx
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Xxxxxxx Xxxxx, President
/s/ Xxxxxxx Xxxxx
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XXXXXXX XXXXX
