EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") made this 2nd day of November,
1999, between Xxxxx.xxx Network, Inc., formally known as Deerbrook Publishing
Group, Inc., a Colorado corporation (the "Company") and Xxxxx Xxxxxxx
("Employee").
RECITALS
The Company desires to employ Employee and Employee desires to be so
employed. The terms, conditions and undertakings of this Agreement were
submitted to and duly approved and authorized by unanimous consent of the
Company's Board of Directors.
It is, therefore, agreed:
1. EMPLOYMENT AND EMPLOYMENT TERM.
(a) EMPLOYMENT. The Company agrees to employ Employee, and Employee
agrees to be so employed, in the capacity of Chief Financial Officer of
XxxXx.Xxx Network, Inc.
(b) EMPLOYMENT TERM. The term of this Agreement shall be for a period
of three years commencing as of November 1, 1999 and terminating on October 31,
2002.
(c) TERMINATION UNDER CERTAIN CIRCUMSTANCES. Notwithstanding the
provisions of Section 1(b):
(i) DEATH. Employee's employment shall be automatically
terminated effective upon the date of Employee's death.
(ii) DISABILITY. Employer may, at its option and upon written
notice to Employee, terminate Employee's employment as a result of "Total and
Permanent Disability" (as defined below) effective on the date of that notice.
For purposes of this Agreement, the term "Total and Permanent Disability" shall
mean such physical or mental condition of Employee that renders Employee
incapable of performing Employee's duties for a period of more than 90
consecutive days or for 90 days within any 180-day period; provided, however,
that Employee shall not be terminated for Total and Permanent Disability until a
qualified and independent (i.e., having no prior affiliations with Employer, or
Employee, Action or any Action affiliate) medical specialist provides written
confirmation, after examination, that Employee is totally and permanently
incapacitated such that Employee can no longer perform Employee's duties
hereunder. In the event that Employee is a "qualified individual with a
disability," as defined in the Americans With Disabilities Act, Employer shall
not terminate Employee's employment hereunder if Employee is able to perform the
essential functions of Employee's job with reasonable accommodation from
Employer.
(iii) UNILATERAL DECISION OF EMPLOYER. Employer may, at its
option, upon notice to Employee, terminate Employee's employment effective on
the date of that notice.
(iv) UNILATERAL DECISION BY EMPLOYEE. Employee may, at his option
and upon notice to Employer, terminate Employee's employment effective on the
date of that notice.
(v) FOR "CAUSE". Employer may, at its option and upon written
notice to Employee, terminate Employee's employment for "Cause" (as defined
below) effective on the date of that notice. For purposes of this Agreement, the
term "Cause" shall mean (i) the failure or inability (other than as a
consequence of any illness, accident or other disability, as confirmed by
competent medical evidence) of Employee to perform Employee's duties hereunder
for a period in excess of 30 days in a manner reasonably satisfactory to
Employer's Board of Directors, provided the decision of the Board of Directors
is not arbitrary or capricious and is not made in bad faith; or (ii) "Serious
Misconduct" of Employee (as defined below). For purposes of this Agreement, the
term "Serious Misconduct" shall mean embezzlement or misappropriation of
corporate funds; acts of Dishonesty (as defined below); activities harmful to
the reputation of Employer (other than as a consequence of good faith decisions
made by Employee in the normal performance of Employee's duties hereunder); the
conviction of or the plea by Employee to any criminal felony offense (other than
those arising within the scope of Employee's employment hereunder, of which
offenses Employee was not personally aware or did not personally and knowingly
order in violation of the law, and other than a traffic or other offense that in
the sole discretion of the Board of Directors of Employer does not affect
Employee's position as an Employee of Employer) or any criminal offense
involving dishonesty or moral turpitude; the refusal to perform the duties
assigned to Employee pursuant to this Agreement (unless such duties shall be
unlawful); or the breach of any of the material terms or conditions contained in
this Agreement. For purposes of this Agreement, the term "Dishonesty" shall mean
the varnishing of any information, reports, documents or certificates by
Employee to Employer which Employee knew or reasonably should have known to be
false or misleading.
(d) RESULT OF TERMINATION. In the event of the termination of
Employee's employment pursuant to Sections 1(c)(i), (ii), or (iii) above,
Employee's estate or Employee, as the case may be, shall be entitled to receive
an amount equal to Employee's fixed salary as in effect pursuant to Section 3 at
the time of termination for a period of one year after such termination. In the
event of the termination of Employee pursuant to Section 1(c)(iv) and 1(c)(v)
above, Employee shall receive no further compensation under this Agreement.
2. TIME AND EFFORTS. Employee shall diligently and conscientiously devote
full time, attention and best efforts in discharging his duties as the Chief
Financial Officer of XxxXx.Xxx Network, Inc. He shall serve as a Director of
XxxXx.Xxx Network, Inc. and retain a seat on the Board of Directors of any Spin
Off Company or other Company that XxxXx.Xxx Network has more than a twenty
percent interest (20%) in. Employee shall perform duties customarily incident to
such offices and all other duties the Board of Directors may from time to time
assign to him.
3. COMPENSATION.
(a) During the first twelve (12) months of this Agreement, the Company
shall pay to Employee a base salary amount of $150,000 per year as compensation
for his services. This amount shall be paid in equal bi-weekly installments. In
addition to all other remuneration
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provided for in this Agreement, Employee and Company have agreed to additional
compensation, including additional stock and stock options, to be covered in a
separate agreement to be completed by Employee's start date. Employee shall also
be entitled to receive the same Director's fees for such services as that
received by other Directors.
(b) During the second twelve (12) months of this Agreement, Company
shall pay to Employee the base salary amount of $175,000 per year as
compensation for his services. This amount shall be paid in equal bi-weekly
installments.
(c) During the third twelve (12) months of this Agreement, Company
shall pay to Employee a base salary of $200,000 per year as compensation for his
services. This amount shall be paid in equal bi-weekly installments.
4. EXPENSES.
(a) The Employee shall be entitled to all reasonable expenses incurred
on behalf of Company and shall present the Company on a monthly basis an
itemized account of all such expenses.
(b) Company shall pay the costs of all of Employee's personal legal
expenses during the term of, and whether during or after Employee's term,
arising from, or in connection with Employee's employment with the Company.
(c) Company shall pay the costs of Directors and Officers liability
insurance and/or Errors and Omissions insurance at a level recommended from time
to time by Employee's legal counsel.
(d) Company shall pay the costs of Salary Continuation Insurance in
the amount of the total base salary for the term of this Agreement.
(e) Company shall pay the cost of Employee's and his family's medical
Insurance.
5. LONG TERM BONUS.
(a) Employee shall be entitled to stock options of 75,000 shares
during each year of his employment. Options granted at the average closing price
the month prior to grant. Stock shall be restricted for one year from grant.
6. OTHER TERMS.
(a) Any material misrepresentations or omissions, whether intentional
or unintentional, by employee, agents, directors, or officer's of the Company
shall result, at the option of the Employee, in the termination of Employee's
duties under this Agreement. However, said misrepresentations omission shall not
terminate the obligations of the Company under this Agreement.
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7. BINDING EFFECT. This Agreement shall inure to the benefit of and be
binding upon the Company, its successors and assigns, including, without
limitation, any person, partnership, company or corporation which may acquire
substantially all of the Company's assets or business or with or into which the
company may be liquidated, consolidated, merged or otherwise combined. In
addition, this Agreement shall inure to the benefit of and be binding upon
Employee, his heirs, distributees and personal representatives.
8. WAIVER. The failure of either party to insist in any one or more
instances upon performance of any term or condition of this Agreement shall not
be construed a waiver of its future performance. The obligations of either party
with respect to such term, covenant or condition shall continue in full force
and effect.
9. SEVERABILITY. The unenforceability, invalidity, or illegality of any
provision of this Agreement, shall not render the other provisions
unenforceable, invalid or illegal. If any term, provision, covenant or condition
of this Agreement is invalidated due to its scope or breadth, such term,
provision, covenant, or condition shall be deemed valid to the extent of the
scope or breadth permitted by law in accordance with the intent of the parties
as expressed herein.
10. NOTICES. Any notice given hereunder shall be in writing and delivered
or mailed by register for certified mail, return receipt requested:
(a) To the Company, addressed the CEO at 0000 Xxxxx 00xx Xxxxx,
Xxxxxxx, Xxxxxxx 00000.
(b) To Employee at 0000 Xxxxx XxXxxxxxxx, Xxxx 0000, Xxxxx, Xxxxxxx
00000.
Either party may, by notices a provided above, designate a difference address.
Any such notice shall be effective on the date of receipt.
11. ENTIRE AGREEMENT. This Agreement supersedes all previous agreements
between Employee and the Company and contains the entire understanding and
agreement between the parties with respect to its subject matter. This agreement
cannot be amended, modified or supplemented in any respect except by a
subsequent written agreement entered into by both parties.
12. HEADING. Heading in this Agreement are for convenience only and shall
not be used to interpret or construed it provision.
13. GOVERNING LAW. This Agreement shall be construed in accordance with and
governed by the laws of the State of Arizona.
14. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day
and year first above written.
XxxXx.xxx Network, Inc.
By /s/ Xxxx X. Xxxxx
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Xxxx X. Xxxxx, President & CEO
Employee
/s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx
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