EXHIBIT 10.1
EMPLOYMENT AGREEMENT (XXXXXXX X. XXXX)
As of the last date written below, International Microcomputer Software, Inc., a
California corporation, ("IMSI") and Xxxxxxx X. Xxxx ("Employee") enter into
this Employment Agreement ("Agreement").
A. Whereas, IMSI desires to enter into an agreement setting out certain of the
terms under which Employee will remain employed by IMSI;
B. Whereas, IMSI desires Employee's services on a regular basis to perform
various duties as the Company's Chief Financial Officer as determined by the
Board of Director's and President of IMSI;
NOW, THEREFORE, the Parties agree as follows:
1. EMPLOYMENT - IMSI hereby retains Employee as Chief Financial Officer with
overall responsibilities as requested and amended from time to time by the
President of IMSI.
2. COMPENSATION - IMSI shall compensate Employee as follows:
BASE SALARY - IMSI shall pay Employee as salary $10,000.00 for each month,
payable on the 15th and the last day of each month. Salary may be adjusted by
IMSI from time to time commensurate with Employee's role.
BONUS PLAN- Employee is eligible for a quarterly bonus equal to $15,000.00.
Bonus will be based on meeting job specific MBO's and corporate performance as
documented in the Quarterly Bonus Plan to be agreed on by Employee and direct
supervisor..
EMPLOYEE BENEFITS - Employee shall have the right to continued participation in
any and all health benefits, Employee retirement income and welfare benefit
plans, policies, programs, agreements or arrangements generally made available
from time to time to salaried Employees and/or other Employees of IMSI which
shall include, at a minimum, medical and dental insurance and other benefits
which are presently in effect for Employees of IMSI. Employee shall be entitled
to ten (10) days of paid vacation time each year. Employee's specific rights
under any of the Employee Benefits, however, shall be governed by the terms,
provisions and conditions of the underlying plans, policies, programs,
agreements or arrangements relating to the particular Employee Benefits.
Employee's employment shall be deemed "continuing" for purposes of IMSI's stock
option plan and warrants granted to Employee while this agreement is in effect.
3. TERMINATION OF EMPLOYMENT - IMSI may terminate Employee's employment at any
time with or without cause.
TERMINATION WITHOUT CAUSE -Termination without Cause shall include, but not be
limited to:
The consummation of a merger or consolidation of the Company with or into
another entity or any other corporate reorganization, consolidation or other
reorganization where immediately after such merger, consolidation or other
reorganization 50% or more of the voting power of the outstanding securities of
Company changes hands into either the continuing or surviving entity or any
direct or indirect parent corporation of such continuing or surviving entity; or
The sale, transfer or other disposition of all or substantially all of the
Company's assets.
IMSI or its successor(s) choosing to substantially alter the position,
geographic location (with nine (9) months of the transaction date) or
responsibilities of Employee during the term of this Agreement A transaction
shall not constitute a Termination Without Cause if its sole purpose is to
change the state of the Company's incorporation or to create a holding company
that will be owned in substantially the same proportions by the persons who held
the Company's securities immediately before such transaction.
Should Employee's termination be deemed to be a Termination without Cause then
the following benefits will accrue to Employee;
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SEVERANCE BENEFIT
If the Termination Without Cause occurs prior to June 30, 2003, Employee accrues
three (3) months of gross salary, which will be paid over 6 months. If the
Termination Without Cause occurs subsequent to June 30, 2003, Employee accrues
five (5) months of gross salary, which will be paid over 10 months.
MEDICAL BENEFIT
Company paid benefit plan (including but not limited to health, dental, vision
and life insurance coverage) for twelve (12) months subsequent to Termination
without Cause. Benefits to be provided are the same as Employee maintained
during employment. At Company's discretion, Company has the right to provide a
cash buyout of Medical Benefit which is to be calculated using the Company's
currently effective COBRA rates for same benefits.
CASH BONUS
In the event of a sale, merger or consolidation of the Company with or into
another entity or any other corporate reorganization which results in a net
share amount between $1.00 and $1.75, Employee earns a bonus of $50,000, which
becomes immediately payable.
In the event of a sale, merger or consolidation of the Company with or into
another entity or any other corporate reorganization which results in a net
share amount greater than $1.75, Employee earns a bonus of $100,000, which
becomes immediately payable In the event of a sale of any individual product
line with a net sales price greater than $5,000,000, Employee earns a bonus of
$25,000, which becomes immediately payable.
ACCELERATED VESTING
Any, and all, unvested Incentive Stock Option ("ISO") options or warrants which
have been duly granted by the Company to Employee become immediately
exercisable, any other provision of the Incentive Stock Option agreement
notwithstanding.
TERMINATION BY IMSI FOR CAUSE - IMSI may terminate this Agreement immediately
for cause by giving written notice to Employee. For purposes of this Agreement,
"for cause" shall mean (i) the unauthorized use or disclosure of the
confidential information or trade secrets of the Company, which use or
disclosure causes material harm to the Company, (ii) conviction of, or a plea of
"guilty" or "no contest" to, a felony under the laws of the United States or any
state thereof, (iii) gross negligence, (iv) willful misconduct or (v) continued
failure to perform assigned duties after receiving written notification from the
Board. The foregoing, however, shall not be deemed an exclusive list of all acts
or omissions that the Company (or a Parent or Subsidiary) may consider as
grounds for the discharge of the Employee without Cause. Upon a "for cause"
termination, IMSI shall have no further compensation obligation to Executive.
TERMINATION BY EMPLOYEE - Employee may terminate his employment with IMSI at any
time with or without cause and shall receive no severance benefits in case of
such termination.
THESE TERMINATION PROVISIONS SHALL SURVIVE TERMINATION OF THIS AGREEMENT AND CAN
ONLY BE MODIFIED BY A SUBSEQUENT WRITTEN AGREEMENT EXECUTED BY EMPLOYEE AND
IMSI.
4. TRADE SECRETS - Employee acknowledges that IMSI possesses and will continue
to develop and acquire valuable Proprietary Information. The value of that
Proprietary Information depends on it remaining confidential. IMSI depends on
Employee to maintain that confidentiality, and Employee accepts that position of
trust. Employee agrees, upon leaving employment with IMSI for any reason, to
promptly deliver to IMSI all material documents, including but not limited to,
writings and computer data, in Employee's possession, custody, or under
Employee's control containing or disclosing Proprietary Information. In
addition, Employee agrees to remain bound by and to sign any and all standard
employee documents normally signed by all IMSI employees related to their
employment by IMSI.
5. CONFLICTS WITH OTHER ACTIVITIES - Employee agrees that his employment with
IMSI is non-exclusive but requires substantial attention and effort. Therefore,
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while employed by IMSI, Employee will not, without IMSI's consent, engage in any
employment or business competitive with the business of IMSI.
6. ADDITIONAL PROVISIONS RELATING TO PAYMENTS - If IMSI finds that, at the time
any payment is due under this Agreement, Employee is unable to care for his
affairs because of illness or accident, payment (unless a duly qualified
guardian or other legal representative of Employee has made IMSI an earlier
claim for it) may be paid to any individual deemed by IMSI to be maintaining
Employee or responsible for Employee's maintenance, and any such payment shall
be deemed to be payment for the Employee's account and shall be a complete
discharge of any liability under this Agreement. IMSI will honor any request
made prior to his disability by Employee regarding such payments. IMSI may
withhold from any amounts payable under this Agreement all federal, state, city
or other taxes as required under any law or government regulation or ruling.
7. GOVERNING LAW - This Agreement shall be construed and its performance
enforced in accordance with the laws of the State of California, excluding its
choice of law provisions.
8. MODIFICATIONS - Any and all modifications, amendments, or additions to this
Agreement shall be in writing. Similarly, any and all waivers of any terms of
this Agreement shall be in writing. Any and all oral modifications, amendments,
additions, and/or waivers shall be unenforceable.
9. DISPUTE RESOLUTION - The Parties agree to submit any disputes involving
money or damages greater than $5,000 relating to this Agreement and/or
transactions, duties, or obligations to be performed under this Agreement, to
mediation with a mediator approved by the Parties to the dispute. If the Parties
resolve their disputes through mediation, the Parties shall share the mediator's
fees evenly but pay their own attorneys' fees and other expenses related to
mediation. If mediation fails to resolve all disputes within thirty (30) days
after submission to the mediator, then either Party may file a lawsuit or
request arbitration. The Parties agree that mediation is a pre-condition to
filing a lawsuit. The prevailing Party in any law suit or arbitration relating
to the transactions contemplated by this Agreement shall be entitled to costs
and expenses including reasonable attorney's fees and the attorneys' fees and
expenses incurred in connection with mediation that failed to resolve the
dispute. Claims of $5,000 or less may be submitted to mediation or small claims
court.
10. SEVERABILITY - If a court of competent jurisdiction or arbitrator finds that
one or more provisions of this Agreement is or are illegal or unenforceable, the
remaining provisions of this Agreement shall remain in full force and effect as
if such provision or provisions never existed.
11. WAIVER - No Party's right to require performance of another Party's
obligations under this Agreement shall be affected by any previous delay in
enforcing such right, express waiver of prior similar right to require
performance, or course of dealing.
12. INTEGRATION CLAUSE - This Agreement, together with any standard IMSI
employee documents signed by Employee, contain the entire agreement of the
Parties relating to the employment of Employee. The Parties have made no
agreements, representations, or warranties relating to the subject matter of
these agreements that are not stated herein.
13. INTERPRETATION OF THIS AGREEMENT - The Parties acknowledge that they and
their attorneys have had an opportunity to review this Agreement in detail and
to comment on and draft any and all additional terms or modifications to this
Agreement. Accordingly, the Parties agree that this Agreement shall not be
interpreted against any Party under California Civil Code ss. 1654 because the
attorney for that Party drafted this Agreement or any provision of this
Agreement.
14. SUCCESSORS - Should any change in IMSI ownership or structure occur, this
agreement shall survive and inure to the benefit of and be binding on the legal
representatives, successors and assigns of the parties.
15. INDEMNIFICATION OF LOSSES OF EMPLOYEE - IMSI shall indemnify Employee for
all direct losses sustained by Employee as a result of the proper,
non-negligent, and non-criminal discharge of his duties on IMSI's behalf.
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16. NOTICES. Notices under this Agreement shall be sufficient only if sent (a)
by overnight courier, or (b) by facsimile or other electronic means and by U. S.
Mail, or (c) personally delivered to the other Party.
17. COUNTERPARTS. This Agreement may executed in one or more counterparts, each
of which shall be deemed to be an original, but all of which together shall
constitute one and the only Agreement.
IN WITNESS WHEREOF, the Parties execute this Agreement as of the last date
written below.
Date: February 11, 2003
IMSI: ____/s/ Xxxxxx Xxxx, III
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Date: February 11, 2003 Employee: ___/s/ Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx
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