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EXHIBIT 10.45
SECOND RESTATEMENT OF EMPLOYMENT AGREEMENT
THIS SECOND RESTATEMENT OF EMPLOYMENT AGREEMENT (this "Agreement") is
entered into effective as of July 9, 1998, between STAR TELECOMMUNICATIONS,
INC., a Delaware corporation ("STAR"), as successor in interest to STAR Vending,
Inc., a Nevada corporation, and XXXXX XXXXXXX (the "Employee").
RECITALS:
A. STAR and Employee are parties to that certain Employment Agreement
dated September 14, 1996 (the "Employment Agreement"), as amended by that
certain First Restatement of Employment Agreement dated December 18, 1996 (the
"Restated Agreement"), and as amended by that certain Amendment Number One to
First Restatement of Employment Agreement dated June 16, 1997, pursuant to which
Employee is employed by STAR.
B. The Parties desire to amend and restate all the previous agreements
to provide Employee with additional compensation in the event that Employee is
terminated without cause. Thus, the parties have determined to execute this
Agreement.
AGREEMENT:
NOW, THEREFORE, the parties, intending to be legally bound, agree as
follows:
1. EMPLOYMENT. During the term of this Agreement, STAR shall employ
Employee, and Employee accepts employment, as Executive Vice President -
Operations and Engineering. Employee's primary duties will be to manage STAR's
operations (other than sales and marketing) in accordance with the policies
established by STAR's Board of Directors. Employee will faithfully perform his
duties to the best of his ability in accordance with the reasonable directions
of STAR as given through the Board of Directors, the Chief Executive Officer and
the President. Employee will devote his full business time, ability, attention
and loyalty to the business of STAR during the term of this Agreement, and will
not, directly or indirectly, render any services of a business, commercial or
professional nature to any other person, firm, corporation or organization for
compensation without the prior written consent of STAR.
2. TERM. The term of Employee's employment by STAR pursuant to this
Agreement shall be for the period commencing September 14, 1996 and ending
December 31, 2000. The term of Employee's employment is subject to earlier
termination as provided in Section 7."
3. COMPENSATION; FRINGE BENEFITS
3.1 Base Salary. STAR shall pay Employee a monthly salary during the
term of this Agreement. This salary shall be $16,666.67 per month. Employee's
salary shall not be reduced at any time during the term of this Agreement, but
the foregoing shall not limit STAR's rights under Section 7.
3.2 Stock Options. Employee shall be awarded incentive stock options
to purchase a total of 100,000 shares of STAR's common stock pursuant to STAR's
1996 Supplemental Stock Option Plan.
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3.3 Fringe Benefits. During the employment term, Employment shall
be entitled to receive, a STAR's sole expense, the following fringe benefits:
A. Group health insurance, paid vacation leave, life insurance
and other insurance programs as set forth in STAR's employee manual applicable
to employees generally to the same extent, and on the same terms, as other
employees of STAR; and
B. Other benefits accorded to executives of STAR as determined
from time to time by the Board of Directors.
3.4 Taxes. Compensation paid to Employee under Sections 3.1 through
3.3, inclusive, shall be subject to withholding for federal and state income
tax purposes. All payments received by Employee shall be reported on his
federal and state tax returns as compensation for employment in a manner
consistent with this Agreement.
3.5 Expenses. During the employment term, STAR shall reimburse
Employee for reasonable out-of-pocket expenses incurred in connection with STAR
business. All reimbursements required by this Section 3.5 shall be subject to
such reasonable policies and record keeping as STAR may from time to time
establish for its employees.
4.1 CONFIDENTIAL INFORMATION. Employee shall, during the term of this
Agreement and thereafter, hold in confidence and not disclose to any person or
entity without the express prior authorization of STAR, any and all trade
secrets of STAR (including, without limitation, all customer lists and lists of
customer sources), and any and all other secret or confidential information
relating to the services, customers, sales or business affairs of STAR or its
affiliates. Employee agrees that he will not make use of any of the above at any
time after termination of his employment. Upon termination of his employment,
Employee shall deliver to STAR all documents, records, notebooks, work papers
and all similar repositories containing any information concerning STAR, whether
prepared by Employee, STAR or anyone else. This Agreement will further
incorporate any and all provisions with respect to confidentiality, trade
secrets, secret processes and data to which STAR may be required to cause its
employees to agree under the terms and provisions of any contract entered into
by STAR with any customer or client thereof, or under the terms of any
subcontract to which STAR may be a party, whether the same be in any contract to
which STAR is presently a party or may, during the course of this Agreement,
become a party, or under the provisions of any other contract with a customer of
STAR.
5. NO SOLICITATION OF EMPLOYEES. Employee agrees that during the term of
this Agreement, and for a period of twelve (12) months thereafter, he will not,
directly or indirectly, for himself, or as agent, or on behalf of or in
conjunction with any other person, firm, partnership, corporation or other
entity, induce or entice any employee of STAR or its affiliates to leave such
employment or cause anyone else to do so.
6. ASSIGNMENT. Employee shall not have any right to delegate or
transfer any duty or obligation to be performed by him to any third party, nor
to assign or transfer the right, if any, to receive payments under this
Agreement.
7. TERMINATION.
7.1 Method of Termination. This Agreement and the employment of
Employee may be terminated at any time:
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A. By mutual agreement of the parties.
B. By STAR if Employee dies or becomes physically or
mentally disabled (the term "disabled" shall mean any mental or physical
illness or disability that renders the Employee unable to perform the essential
functions of his position, after reasonable accommodation of such disability by
STAR).
C. By STAR, for cause, if Employee (a) has committed any
material act of dishonesty, fraud or misrepresentation or any act of moral
turpitude; (b) is in default in the performance of Employee's material
obligations, services or duties under this Agreement; or (c) has failed to
execute specific instructions from STAR's Board of Directors or executive
officers, which failure is not corrected by Employee after reasonable notice
from STAR.
D. By STAR, without cause, at any time during the term of
this Agreement.
E. By the Employee if STAR is in default of its material
obligations or duties under this Agreement.
F. By the Employee, without cause, at any time during the
term of this Agreement.
7.2 Consequences of Termination. Employee shall be entitled to the
following compensation in the event of a termination:
A. In the event of any termination under Sections 7.1A,
7.1B, 7.1C, or 7.1F, Employee (or, in the event of Employee's death, his
estate) shall be entitled to receive compensation accrued and payable to him as
of the date of termination or death, and all other amounts payable under this
Agreement shall thereupon cease.
B. In the event of any termination under Section 7.1D or
Section 7.1E, then Employee shall continue to receive the compensation provided
in this Agreement until the expiration of this Agreement. Any amounts earned by
him (other than through his personal investment activities) prior to such
expiration by virtue of other employment shall be deducted from amounts to
which he is entitled under this Agreement.
7.3 IRC Violations. Any provision in this Agreement to the
contrary notwithstanding, in no event will Employee receive a payment which
would trigger the excise taxes and disallowance of deductions contemplated by
Sections 280G and 4999 of the Internal Revenue Code of 1986, as amended (the
"Code"). In the event that any amount calculated would result in such a payment,
such amount shall be reduced to the largest amount that would not result in such
a payment. This reduction shall apply to any and all compensation, including
compensation pursuant to stock option grants governed by separate agreement
between STAR and Employee. If, at the time of any such payment, no stock of STAR
is readily tradeable on an established securities market or otherwise, then STAR
agrees to use its best efforts to cause such payment to meet the exemption set
forth in Sections 280G(b)(5)(A)(ii) and (B) of the Code, so that no reduction
will be required under this Agreement.
8. REPRESENTATIONS AND WARRANTIES OF EMPLOYEE. Employee represents and
warrants that there are no agreements or arrangements, whether written or oral,
that would be breached by Employee
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upon execution of this Agreement or that would impair or prevent Employee from
rendering exclusive services to STAR during the term of this Agreement, and
that Employee has not made and will not make any commitment to do any act in
conflict with this Agreement.
9. MISCELLANEOUS. This Agreement, and the legal relations between the
parties, shall be governed by and construed in accordance with the laws of the
State of California. This Agreement supersedes all prior agreements between the
parties concerning the subject matter, and constitutes the entire agreement
between the parties with respect to the subject matter. This Agreement may be
modified only with a written instrument duly executed by each of the parties.
No waiver by any party of any breach of this Agreement shall be deemed to be a
waiver of any proceeding or succeeding breach. The headings and titles to the
Sections of this Agreement are inserted for convenience only and shall not be
deemed a part of or effect the construction or interpretation or any provision
of this Agreement. This Agreement may be executed in counterparts, each of
which shall be deemed to be an original, and all such counterparts together
shall constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date above written.
STAR TELECOMMUNICATIONS, INC.
a Delaware corporation
By [sig]
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Xxxx Xxxxx, President
[sig]
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Xxxxx Xxxxxxx
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