EMPLOYMENT AGREEMENT
Exhibit
10.29
This
EMPLOYMENT AGREEMENT
(the “Agreement”), dated
as of December 2, 2008 (the “Effective Date”), is by and
between GoFish Corporation, a Nevada corporation (the “Company”) and Xxxx Xxxxxxx
(“Executive”). This
Agreement amends, restates and supersedes that certain Employment Agreement
dated as of June 5, 2008, by and between the Company and Executive.
I.
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POSITION
AND RESPONSIBILITIES
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A. Term. The Company
shall employ Executive from the Start Date (as defined below) until Executive’s
employment is terminated in accordance with Sections III, IV or V below (the
“Term”). The Company and
Executive shall mutually agree on a date on which Executive will commence
employment with the Company (the “Start Date”) as soon as
practicable after the Effective Date.
B. Position. Upon the
Start Date, the Company shall employ Executive to render services to the Company
in the position of Chief Executive Officer of the Company. Executive
shall perform such duties and responsibilities as are normally related to the
position in accordance with the standards of the industry and any additional
duties, consistent with his position, now or hereafter reasonably assigned to
Executive by the Company’s Board of Directors (the “Board of
Directors”). Executive shall report to the Board of
Directors. Executive shall abide by the reasonable rules,
regulations, and practices as adopted or modified from time to time by the Board
of Directors. Executive will also serve as a member of the Board of Directors
effective as of the Effective Date. Executive shall also serve
as an officer, director, or in such other executive capacity on behalf of any of
the Company’s affiliated entities as requested by the Company without any
additional compensation. Executive shall be located in the Company’s
office in New York and shall be expected to travel, including spending up to
fifty percent (50%) of his time in the Company’s San Francisco and Los Angeles
offices, if necessary, and to be available for special calls and teleconference
meetings to meet the obligations of his position.
C. Other
Activities. By executing this Agreement, Executive agrees to
serve in such position and to devote his full time, attention, loyalty and
efforts to the performance of Executive’s duties. Executive may,
during the Term, serve as an advisor to or be on the board of directors of other
companies as long as those companies are not competitors of
Company. Competitors of the Company, for this purpose, include but
are not limited to, online vertical advertising networks, brand advertising
networks and companies that target the online youth demographic based on an
internet advertising-based business model. Notwithstanding any
provision of this Section I(C), Executive shall be permitted to engage in
charitable and civic activities and manage his personal passive investments;
provided that such activities do not materially interfere with the performance
of his duties under this Agreement.
D. No
Conflict. Executive represents and warrants that his execution
of this Agreement, his employment with the Company, and the performance of his
proposed duties under this Agreement shall not violate any obligations he may
have to any other employer, person or entity, including any obligations with
respect to proprietary or confidential information of any other person or
entity.
II.
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COMPENSATION
AND BENEFITS
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A. Base Salary and Qualified Financing
Bonus. In consideration of the services to be rendered under
this Agreement, the Company shall pay Executive a salary at the monthly rate of
thirty seven thousand five hundred dollars ($37,500), less standard payroll
deductions and tax withholdings (“Base Salary”), beginning on
the Start Date. Upon the completion of one or more debt or equity
financings totaling at least $8 million (a “Qualified Financing”), the
Base Salary shall be increased to a monthly rate of fifty thousand dollars
($50,000), less standard payroll deductions and tax withholdings. At
the one-year anniversary of the Start Date, if the Company has completed a
Qualified Financing, Executive shall receive a bonus payment equal to $12,500
times the number of months between the Start Date and the date of completion of
a Qualified Financing (prorated for any partial months), to be paid by the
Company 30 days following the one-year anniversary of the Start Date. The Base
Salary shall be paid in accordance with the Company’s normal payroll procedures
and practice. Executive’s Base Salary will be reviewed annually in
accordance with the Company’s compensation review process and may be adjusted
(upward, but not downward) in the sole discretion of the Company.
B. Performance
Bonus. Executive shall be eligible to participate in an
incentive compensation plan to be established by the Board of Directors, under
which Executive shall be eligible to receive up to one hundred fifty thousand
dollars ($150,000) per year (the “Target Bonus”),
contingent upon attainment of performance targets to be mutually agreed upon by
Executive and the Board of Directors, as part of the Company’s annual operating
plan. The Target Bonus will be paid as
soon as administratively practicable following the date on which the Board of
Directors certifies that such performance targets have been achieved but in no
event later than the fifteenth day of the third month of the calendar year
following the calendar year for which the Target Bonus
relates.
C. Stock Options. On
the Effective Date, Executive shall be granted non-qualified stock options to
purchase a total of five million (5,000,000) shares of Common Stock of the
Company (each such option, an “Option” and, collectively, the
“Options”). On the
Effective Date, the Options reflect 8.35% of the outstanding capital stock of
the Company, on a fully-diluted basis. The exercise price of the
Stock Options shall be: (i) with respect to fifty percent (50%) of the Options,
the closing price on the Effective Date, and (ii) with respect to the other
fifty percent (50%) of the Options, $0.80 per share, subject to adjustment to
the price per share of the Qualified Financing if the Qualified Financing is an
equity financing completed at a per share price less than $0.80 per share, but,
in no event, shall the adjusted price per share be less than the closing price
on the Effective Date. The Options shall vest monthly over a
three-year period, beginning on the Start Date and subject to Executive’s
continuing employment with the Company. The terms and form of the Options shall
be set forth in a stock option agreement executed by Executive and the Company,
substantially in the same form attached as Exhibit A hereto.
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D. Anti-Dilution Protection. The
Company will provide Executive with anti-dilution protection at 8% of the
outstanding capital stock of the Company (on a fully-diluted basis) up to the
first $10 million of additional equity or convertible debt. Options made
available to Executive as part of this anti-dilution protection will be granted
upon the closing date of the additional capital financing and will be priced at
the then-current market price. Vesting will be in accordance with the same
vesting schedule as the original option grants specified above such that on the
grant date, a pro rata portion (based on the percentage of the original option
grant that has vested as of the grant date) of the newly-issued options will be
fully-vested.
E. Benefits. Executive
shall be eligible to participate in the benefits made generally available by the
Company to the Company’s similarly-situated employees, in accordance with the
benefit plans established by the Company, and as may be amended from time to
time in the Company’s sole discretion. Until such time as Executive
becomes eligible for coverage by the Company’s medical plan, the Company shall
pay the cost of COBRA coverage provided by Executive’s prior
employer.
F. Expenses. Executive
shall be reimbursed for all reasonable business-related travel and other
expenses incurred by Executive. Executive shall be entitled to incur
expenses for accommodations and travel at the same standard as the President or
Executive Chairman of the Company.
G. Vacation. During
the term of this Agreement, Executive shall be entitled to accrue, on a pro rata basis, twenty (20)
paid time off days per year in accordance with the Company’s standard PTO
policy, and shall be entitled to carry over accrued, unused PTO days from year
to year, of the greater of 240 hours per year or the maximum amount stated in
the Company’s standard PTO policy.
H. Indemnity
Agreement. The Company and Executive shall enter into an
Indemnity Agreement with the Company in substantially the form attached hereto
as Exhibit B (the “Indemnity
Agreement”).
I. Stock Ownership
Guidelines. During the Term, Executive will comply with the
reasonable corporate officer stock ownership guidelines (consistent with
similarly-situated companies) approved by the Board of Directors, as may be
amended from time to time, and provided in writing to Executive.
J. Legal Fees. The Company shall
reimburse Executive up to thirty thousand dollars ($30,000) for legal fees
incurred in the negotiation of this Agreement. The Company shall reimburse Executive as
soon as administratively practicable following the Start Date but in no event
later than March 15, 2009.
K. Registration of
Shares. The Company shall use reasonable commercial efforts to
cause the shares of Company common stock to be issued upon the exercise of the
Options to be registered with the Securities Exchange Commission on Form S-8
within six months of the Start Date, but in no event shall such filing be
completed later than nine months from the Start Date.
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III.
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AT-WILL
EMPLOYMENT; TERMINATION BY COMPANY
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A. At-Will Termination by
Company. Executive’s employment with the Company shall be
“at-will” at all times. The Company may terminate Executive’s
employment with the Company at any time, without any advance notice, for any
reason or no reason at all, notwithstanding anything to the contrary contained
in or arising from any statements, policies or practices of the Company relating
to the employment, discipline or termination of its employees. Upon
and after such termination, all obligations of the Company under this Agreement
shall cease, except as otherwise provided herein.
X. Xxxxxxxxx. Except
in situations where the employment of Executive is terminated For Cause, By
Death or By Disability (as defined in Section IV below), in the event that Executive has a “separation from
service” (within the meaning of Code Section 409A) due to
termination by the Company at any time and Executive has satisfied all
obligations in Section VI below (1) Executive will be eligible to receive (a)
all compensation, unreimbursed expenses and accrued and unused vacation days to
which Executive is entitled through the date of separation from service, (b) the then-current
Base Salary of Executive payable in the form of a salary continuation in
accordance with the Company’s payroll procedures and practice for a period of
twelve (12) months after such separation from
service (the “Severance
Period”), (c) any portion or
all of the Target Bonus earned under
Section II(B) for a calendar year prior to the date of separation from service that remains unpaid as of
the separation date, payable on the date
such bonus otherwise would be paid, and (d) a pro rated portion (pro rated up to
the last day of the month of the separation from
service) of the Target Bonus payable to Executive under Section II(B)
hereof, payable on the date such bonus otherwise would be paid, (2) the Options
awarded to Executive will continue to vest in accordance with the vesting
schedule set forth in Section II(C) above for the Severance Period and, to the extent
unexercised, shall expire (x) in the event of termination For Cause, on the earlier of two (2) years after the date of such separation from service or the
expiration date as set forth in the applicable stock option
agreement, and (y) in the event of
termination By Death or By Disability, on
the earlier of three (3) years after the
date of such separation from service or the
expiration date as set forth in the applicable stock option agreement,
and (3) the Company will cover Executive’s costs of coverage under the
Consolidated Omnibus Budget Reconciliation Act, or COBRA, provided that
Executive timely elects coverage under same. Such payments
will be made on a monthly basis and will
terminate 12 months after the separation date. In the event that Executive is
employed by a subsequent employer before the end of the Severance Period, then
the amount of salary continuation payable
under clause (b) above shall be shortened
to six (6) months or the length of time between the effective date of such separation from service and the date upon which
Executive begins such subsequent employment, whichever is longer; provided, however,
that if Executive’s salary at such subsequent employer is lower than the Base
Salary, then Executive shall be entitled to receive the difference between the
Base Salary and Executive’s salary with such subsequent employer until the end
of the twelve month period. Executive’s eligibility for severance is conditioned
on Executive having first signed a standard release as provided in Section VI(D)
hereof, and all severance payments pursuant to Section III(B)(1)(b) above shall
be made within thirty (30) days after such release has become effective,
provided that the Executive has returned all Company property in his possession,
and (to the extent applicable) the Executive has resigned as a member of the
Board of Directors of the Company and all of its subsidiaries, no later than the
deadline for returning the release as provided in Section VI(D)
below. Executive shall not be entitled to any severance payments if
Executive’s separation from service is For Cause, By Death or By Disability
(as defined in Section IV below). Except as set forth in this Section
V(B), upon such separation from service,
all unvested Options not subject to continuing vesting for the Severance Period
shall immediately expire effective as of the date of such separation from service. If the Company voluntarily provides more favorable
severance benefits to any other Company employee or officer, or if Company has
in effect, 60 days after the Effective Date, agreements with employees or
officers containing more favorable severance terms than those contained in this
Agreement, then Executive will be entitled to receive those more-favorable
severance terms.
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C. “Change of
Control.” In the event of a Change of Control before
Executive’s service terminates, 50% of any unvested Options would become fully
vested immediately prior to the occurrence of the Change of
Control. If there is a Change of Control before Executive’s service
terminates and if Executive is terminated without Cause or resigns for Good
Reason within 12 months of the Change of Control and a “separation from service” (within the meaning of Section
409A of the Code) occurs, then in addition to the vesting provided in the
preceding sentence upon a Change of Control, any remaining unvested Options, if
any, shall vest immediately prior to such separation from service. Executive
shall have thirty-six (36) months from such separation from service to exercise Executive’s
vested options (provided that no such period shall extend beyond the maximum
term specified in such Stock Award). For purposes of this Agreement,
“Change of Control”
shall mean a “Change in Control” as defined on the
date hereof in the Company’s 2007
Non-Qualified Option
Plan. Notwithstanding the foregoing, a “Change of Control”
shall not include a transaction within twelve months of the Effective Date
solely for the purpose of an equity financing (and not a sale) of the Company
where the total transaction amount is less than $50 million, provided that,
after such transaction, the shares into which the Options are convertible into
are shares in the same entity and of the same class as the other officers and
directors of the Company.
IV.
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OTHER
TERMINATIONS BY COMPANY
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A. Termination for
Cause. For purposes of this Agreement, “For Cause” shall mean
Executive: (i) is convicted of, or pleads “guilty” or “no contest” to, a
felony under the laws of the United States or of any state thereof, excluding
convictions associated with traffic violations; (ii) willfully engages in
conduct that is in bad faith and materially injurious to the Company, including
but not limited to, misappropriation of the
Company’s trade secrets, fraud or embezzlement; (iii) commits a
material breach of this Agreement, or the Option, Confidentiality, or Management
Lock-Up Agreements between Executive and the Company, which breach is not cured
within thirty days after written notice delivered to Executive from the Board;
(iv) willfully refuses to implement or follow a lawful policy or directive
of the Board consistent with Executive’s duties and title, which breach is not
cured within thirty days after written notice delivered to Executive from the
Board, (v) demonstrates a pattern of failing to perform job duties
diligently and professionally and fails to cure such breach within sixty days
after written notice delivered to Executive from the Board, or (vi) engages
in the unauthorized use or disclosure of the Company’s trade
secrets. With respect to clauses (iii) and (iv) above, grounds For
Cause will only exist after a finding by the Board of such material breach or
failure and the failure by Executive to remedy such performance to the Board’s
satisfaction within such thirty day period. With respect to clause
(v) above, grounds For Cause will only exist after a finding by the Board
of such material breach or failure and the failure by Executive to remedy such
performance to the Board’s satisfaction within such sixty day
period. The Company shall pay to Executive all compensation,
unreimbursed expenses and accrued and unused vacation days to which Executive is
entitled up through the date of termination, subject to any other rights or
remedies of the Company under law; and thereafter all obligations of the Company
under this Agreement shall cease. Upon such termination of
employment, the unvested Options awarded to Executive shall immediately expire
effective as of the date of such termination and (ii) the vested Options awarded
to Executive, to the extent unexercised, shall expire upon the earlier of one
hundred twenty (120) days after such termination or the expiration date as set
forth in the applicable stock option agreement.
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B. By Death. Executive
shall have “separation from
service” (within the meaning of Section 409A of the
Code) automatically upon
Executive’s death. The Company shall pay to Executive’s beneficiaries
or estate, as appropriate, (a) all compensation, unreimbursed expenses and
accrued and unused vacation days to which Executive is entitled through the date
of such separation from service, (b) all or
any portion of the Target Bonus earned
under Section II(B) for a calendar year prior to the date of separation from service that remains unpaid as of
such date, payable on the date such bonus
otherwise would be paid, and (c) a pro rated portion (pro rated up to the last
day of the month of such separation from service)
of the Target Bonus payable to Executive under Section II(B) hereof,
payable on the date such bonus otherwise would be paid and all other amounts and
benefits specified in this Section II(B). In addition, the Options
awarded to Executive will continue to vest in accordance with the vesting
schedule set forth in Section II(C) above for twelve months from the date of
separation from service and, to the extent
unexercised, shall expire upon the earlier of
three (3) years after the date of such separation from service or the
expiration date set forth in the applicable stock option
agreement. Any options that remain unvested as of the two year
anniversary of such separation from service will expire on the earlier of such date or the expiration date as
set forth in the applicable stock option agreement. Thereafter all
obligations of the Company under this Agreement shall cease. Nothing
in this Section shall affect any entitlement of Executive’s heirs or devisees to
the benefits of any life insurance plan or other applicable
benefits. In connection with such separation from service, Executive shall also be
entitled to receive continued coverage for Executive’s beneficiaries or estate,
as appropriate, under all benefit plans in which Executive was participating as
of the date of such separation from service (to
the extent permitted under the terms of such benefit plans) for a period
of one year following such date; provided
that in the event any such benefit plans do not permit coverage of Executive
following separation from service, the
Company shall provide the economic equivalent of the benefits provided under the
plan in which he is unable to participate. Such payments
will be made on a monthly basis and will terminate 12 months after the
separation date.
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C. By Disability. If
Executive becomes eligible for the Company’s long term disability benefits or
if, in the opinion of a licensed healthcare professional selected by the
Company, Executive is unable to carry out the responsibilities and functions of
the position held by Executive by reason of any physical or mental impairment
for more than one hundred twenty consecutive days or more than one hundred and
eighty days in any twelve-month period, then, to the extent permitted by law,
the Company may cause Executive to
have a “separation
from service”
(within the meaning of Section 409A of the Code). The Company
shall pay to Executive (a) all compensation, unreimbursed expenses and accrued
and unused vacation days to which Executive is entitled up through the date of
the separation from service, (b) all or
any portion of the Target Bonus earned
under Section II(B) for a calendar year prior to the date of the separation from service that remains unpaid
as of such date, payable on the date such
bonus otherwise would be paid, and (c) a pro rated portion (pro rated up to the
last day of the month of such separation from
service) of the Target Bonus payable to Executive under Section II(B)
hereof, payable on the date such bonus otherwise would be paid and all other
amounts and benefits specified in this Section II.C, and thereafter all
obligations of the Company under this Agreement shall cease. In
addition, the Options awarded to Executive will continue to vest in accordance
with the vesting schedule set forth in Section II(C) above for twelve months
from the date of separation from service
and, to the extent unexercised, shall expire upon
the earlier three (3) years after
such separation from service or the expiration
date as set forth in the applicable stock option agreement. Any
options that remain unvested as of the two year anniversary of such separation
from service will expire on the earlier of
such date or the expiration date as set forth in the applicable stock option
agreement. Nothing in this Section shall affect Executive’s rights under
any disability plan in which Executive is a participant. In
connection with such separation from
service, Executive shall also be entitled to receive continued coverage
for Executive under all benefit plans in which Executive was participating as of
the date of such separation from service (to the
extent permitted under the terms of such benefit plans) for a period of
one year following such date; provided that
in the event any such benefit plans do not permit coverage of Executive
following separation from service, the
Company shall provide the economic equivalent of the benefits provided under the
plan in which he is unable to participate. Such
payments will be made on a monthly basis and will terminate 12 months after the
separation date. If Executive disagrees with the
finding of a disability by the Company-selected healthcare professional,
Executive may submit to the Company the opinion of a licensed healthcare
professional of his choice. In the event that the medical opinions of such
licensed healthcare professionals conflict, such licensed healthcare
professionals shall appoint a third licensed healthcare professional to examine
Executive, and the opinion of such third licensed healthcare professional
regarding Executive’s ability to carry out the responsibilities and functions of
his position shall be dispositive for purposes of this Section.
V.
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TERMINATION
BY EXECUTIVE
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A. At-Will Termination by
Executive. Executive may terminate employment with the Company
at any time for any reason or no reason at all, upon no less than six (6) weeks
advance written notice. During such notice period Executive shall
continue to diligently perform all of Executive’s duties
hereunder. The Company shall have the option, in its sole discretion,
to make Executive’s termination effective at any time prior to the end of such
notice period as long as the Company pays Executive all compensation,
unreimbursed expenses and accrued and unused vacation days to which Executive is
entitled up through the last day of the six week notice
period. Thereafter all obligations of the Company shall
cease. Upon such termination of employment, (i) the unvested Options
awarded to Executive shall immediately expire effective as of the date of such
termination and (ii) the vested Options awarded to Executive, to the extent
unexercised, shall expire ninety (90) days after such termination; provided that in each case the Options are no longer
exercisable as of the expiration date set forth in the applicable stock option
agreement.
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B. Termination for Good
Reason. Executive’s termination shall be for “Good Reason” if
Executive resigns within 12 months of an event constituting Good
Reason. Notwithstanding the foregoing, an event shall not be
considered Good Reason unless the Executive provides written notice to the
Company of the Good Reason within thirty (30) days of the event constituting
Good Reason and provides the Company with a period of thirty (30) days to cure
the event constituting Good Reason and the Company fails to cure the Good Reason
within that period and a “separation from
service” (within the meaning of Section 409A of the Code)
occurs. For purposes of this Agreement, “Good Reason” shall mean any of
the following events if the event is effected by the Company without the written
consent of Executive: (A) a change in Executive’s duties with the
Company which materially reduces Executive’s level of responsibility or a
requirement that Executive perform services that are materially inconsistent
with Executive’s position as President; (B) a material reduction in Executive’s
Base Salary; (C) a requirement that Executive report to a person or entity
other than the Board of Directors (provided, however, that it shall not be
considered Good Reason under this clause (C) where Executive is required to
report to a person or entity other than the Board of Directors as a result of a
Change of Control with an entity that is larger than the Company and such change
in reporting structure is not a material diminution in Executive’s authority,
duties, or responsibilities); (D) a change of Executive’s principal place
of performance of duties and responsibilities to a location more than 50 miles
from the location of Executive’s principal place of performance of duties and
responsibilities on the Effective Date; or (E) a material breach of this
Agreement, or the Option, Confidentiality, or Management Lock-Up Agreements
between Executive and the Company. If Executive terminates his
employment for Good Reason, Executive shall receive all of the rights and
benefits specified in Section III(B) hereof.
VI.
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TERMINATION
OBLIGATIONS
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A. Return of
Property. Executive agrees that all property (including
without limitation all equipment, tangible proprietary information, documents,
records, notes, contracts and computer-generated materials, and any copies
thereof) furnished to or created or prepared by Executive incident to
Executive’s employment belongs to the Company and shall be promptly returned to
the Company upon termination of Executive’s employment.
B. Resignation and
Cooperation. Upon termination of Executive’s employment for
any reason, Executive shall be deemed to have resigned from all offices and
directorships then held with the Company. Following any termination
of employment, Executive shall reasonably cooperate with the Company in the
winding up of pending work on behalf of the Company and the orderly transfer of
work to other employees. Executive shall also reasonably cooperate
with the Company in the defense of any action brought by any third party against
the Company that relates to Executive’s employment by the
Company. Any post-termination assistance described in this
Section VI(B) shall be provided at the Company’s sole cost and expense and shall
be subject to Executive’s other commitments.
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C. Continuing
Obligations. Executive understands and agrees that Executive’s
obligations under Sections VI, VII, VIII and IX herein shall survive the
termination of Executive’s employment for any reason and the termination of this
Agreement.
D. Release. Executive agrees to
execute a general release of all claims that Executive may have against the
Company or persons affiliated with the Company. The release must be
in the form reasonably agreed to by Executive and the Company. The
Company will deliver the form to the Executive within 30 days after the
Executive’s separation from service. The Executive must execute and
return the release within the period set forth in the prescribed
form. Any salary continuation payments will commence not later than
30 days after the release has become effective, provided that the Executive has
returned all property of the Company in his possession and (to the extent
applicable) the Executive has resigned as a member of the Boards of Directors of
the Company and all of its subsidiaries, no later than the deadline for
returning the release as provided in this Section VI(D).
VII.
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INVENTIONS
AND CONFIDENTIAL INFORMATION; PROHIBITION ON THIRD PARTY
INFORMATION
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A. Confidential
Information.
1. Executive
expressly acknowledges that, in the performance of his duties and
responsibilities with the Company, he has been exposed since prior to the
Effective Date, and will be exposed, to the confidential and proprietary
information of the Company, its affiliates and/or its clients, business partners
or customers (“Confidential
Information”). The term “Confidential Information” includes
information or material that has actual or potential commercial value to the
Company, its affiliates and/or its clients, business partners or customers and
is not generally known to and is not readily ascertainable by proper means to
persons outside the Company, its affiliates and/or its clients or customers.
“Confidential Information” includes the following, whether or not expressed in a
document or medium, regardless of the form in which it is communicated, and
whether or not marked “trade secret” or “confidential” or any similar legend:
(i) lists of and/or information concerning (including identities of) customers,
prospective customers, suppliers, employees, consultants, co-venturers and/or
joint venture candidates of the Company, its affiliates or its clients or
customers; (ii) non-public information submitted by customers, prospective
customers, suppliers, employees, consultants and/or co-venturers of the Company,
its affiliates and/or its clients or customers; (iii) non-public information
proprietary to the Company, its affiliates and/or its clients or customers,
including, without limitation, cost information, profits, sales information,
prices, accounting, unpublished financial information, business plans or
proposals, expansion plans (for current and proposed facilities), markets and
marketing methods, advertising and marketing strategies, administrative
procedures and manuals, the terms and conditions of the Company’s contracts and
trademarks and patents under consideration, distribution channels, franchises,
investors, sponsors and advertisers; (iv) proprietary technical information
concerning products and services of the Company, its affiliates and/or its
clients, business partners or customers, including, without limitation, product
data and specifications, diagrams, flow charts, know how, processes, designs,
formulae, inventions and product development; (v) lists of and/or information
concerning applicants, candidates or other prospects for employment, independent
contractor or consultant positions at or with any actual or prospective customer
or client of Company and/or its affiliates, any and all confidential processes,
inventions or methods of conducting business of the Company, its affiliates
and/or its clients, business partners or customers; (vi) acquisition or merger
targets; (vii) business plans or strategies, data, records, financial
information or other trade secrets concerning the actual or contemplated
business, strategic alliances, policies or operations of the Company or its
affiliates; or (viii) any and all versions of proprietary computer software
(including source and object code), hardware, firmware, code, discs, tapes, data
listings and documentation of the Company; (ix) trade secrets, business and/or
financial secrets and (x) any other confidential information disclosed to
Executive by, or which Executive obligated under a duty of confidence from, the
Company, its affiliates, and/or its clients, business partners or
customers.
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2. Except
as authorized in writing by the Board of Directors, during the performance of
Executive’s duties and responsibilities for the Company and until such time as
any such Confidential Information becomes generally known to and readily
ascertainable by proper means to persons outside the Company, its affiliates
and/or its clients, business partners or customers, Executive agrees to keep
strictly confidential and not use for his personal benefit or the benefit to any
other person or entity (other than the Company) the Confidential
Information
3. Executive
affirms that he does not possess and will not rely upon the protected trade
secrets or confidential or proprietary information of his prior employer(s) in
providing services to the Company.
4. In
the event that Executive’s employment with the Company terminates for any
reason, Executive shall deliver forthwith to the Company any and all originals
and copies of Confidential Information.
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B. Non-Solicitation.
1. Executive
agrees and acknowledges that by virtue of his position in the Company, he is
familiar with and in possession of the Company’s trade secrets, customer
information and other Confidential Information which are valuable to the Company
and that their goodwill, protection and maintenance constitute a legitimate
business interest of the Company, to be protected by the non-competition
restrictions set forth herein. Executive agrees and acknowledges that
the non-competition restrictions set forth herein are reasonable and necessary
and do not impose undue hardship or burdens on Executive. Executive
also acknowledges that the products and services developed or provided by the
Company, its affiliates and/or its clients or customers are or are intended to
be sold, provided, licensed and/or distributed to customers and clients in and
throughout the United States (the “Geographic Boundary”) (to the
extent the Company comes to own or operate any material asset in other areas of
the United States during the term of Executive’s employment, the definition of
Geographic Boundary shall be expanded to cover such other areas), and that the
Geographic Boundary, scope of prohibited competition, and time duration set
forth in the non-competition restrictions set forth below are reasonable and
necessary to maintain the value of the Confidential Information of, and to
protect the goodwill and other legitimate business interests of, the Company,
its affiliates and/or its clients or customers. For this purpose, the
Company’s business includes products and services that target the online youth
demographic based on an internet advertising based business model.
2. The
Executive agrees that the Company will be irreparably damaged if Executive were
to provide services or to otherwise participate in the business of any person or
company competing with the Company in violation of this Agreement and any such
competition by Executive would result in significant loss of goodwill by the
Company. Therefore, Executive hereby agrees and covenants that he shall not,
without the prior written consent of the Company, directly or indirectly, in any
capacity whatsoever, including, without limitation, as an employee, employer,
consultant, principal, partner, shareholder, officer, director or any other
individual or representative capacity (other than a holder of less than one
percent (1%) of the outstanding voting shares of any publicly held company), or
whether on Executive’s own behalf or on behalf of any other person or entity or
otherwise howsoever, during Executive’s employment with the Company and for a
period equal to one year (or two years, if Executive’s employment is terminated
by Executive in accordance with Section V above) following the termination of
this Agreement and Executive’s employment with the Company, in the Geographic
Boundary:
a. Directly
or indirectly through another person recruit, solicit or interfere with, or
attempt to recruit, solicit, or interfere with, any employee, or independent
contractor of the Company, who was employed by or worked at the Company at the
time of Executive’s termination, to leave the employment (or independent
contractor relationship) thereof, whether or not any such employee or
independent contractor is party to an employment agreement. The Company
acknowledges that this Section will not be violated by general advertising or
general solicitations that are not targeted or directed specifically to
employees of the Company, nor by the consideration or acceptance of unsolicited
applications for employment by such individuals.
11
b. Use
the Company’s Confidential Information or trade secrets or any other means that
would amount to unfair competition to interfere with any relationship,
contractual or otherwise, between the Company and any other party, including;
without limitation, any supplier, co-venturer or joint venturer of the Company
to discontinue or reduce its business with the Company or otherwise interfere in
any way with the Business of the Company. The “Business of the Company”
includes products that target the online youth demographic based on an internet
advertising based business model.
VIII.
|
ARBITRATION
|
Any
dispute, controversy, or claim arising under, out of, in connection with, or in
relation to this Agreement, or the breach termination, validity or
enforceability of any provision of this Agreement (“Arbitrable Claims”), will be
settled by final and binding arbitration conducted in accordance with and
subject to the Judicial Arbitration and Mediation Service’s (“JAMS”) then-current JAMS
Employment Arbitration Rules and Procedures (the “JAMS Rules”), or such other
alternative dispute resolution provider or process agreed by the
parties. Unless otherwise mutually agreed upon by the parties, the
arbitration hearings shall be conducted in San Francisco,
California. A single arbitrator shall be selected in accordance with
the JAMS Rules (the “Arbitrator”) and the
Arbitrator shall allow such discovery as is appropriate, consistent with the
purposes of arbitration in accomplishing fair, speedy and cost effective
resolution of disputes. Judgment upon the award rendered in any such arbitration
may be entered in any court having jurisdiction thereof, or application may be
made to such court for a judicial acceptance of the award and an enforcement of
such award, as the law of such jurisdiction may require or allow. Other than
those matters involving injunctive relief as a remedy that cannot, as a matter
of law, be awarded by the Arbitration, or any action necessary to enforce the
award of the Arbitrator, the parties agree that the provisions of this Section
VIII are a complete defense to any suit, action, or other proceeding instituted
in any court or before any administrative tribunal with respect to any dispute,
controversy or claim arising under or in connection with this
Agreement. THE PARTIES HEREBY WAIVE ANY RIGHT THEY MAY HAVE TO A
TRIAL BY JURY IN REGARD TO THE ARBITRABLE CLAIMS.
IX.
|
AMENDMENTS;
WAIVERS; REMEDIES
|
This
Agreement may not be amended or waived except by a writing signed by Executive
and by a duly authorized representative of the Company other than
Executive. Failure to exercise any right under this Agreement shall
not constitute a waiver of such right. Any waiver of any breach of
this Agreement shall not operate as a waiver of any subsequent
breaches. All rights or remedies specified for a party herein shall
be cumulative and in addition to all other rights and remedies of the party
hereunder or under applicable law.
X.
|
ASSIGNMENT;
BINDING EFFECT
|
A. Assignment. The
performance of Executive is personal hereunder, and Executive agrees that
Executive shall have no right to assign and shall not assign or purport to
assign any rights or obligations under this Agreement. This Agreement
may be assigned or transferred by the Company to any successor to all or
substantially all of the business and/or assets of the Company if such successor
expressly assumes and agrees to perform this Agreement in the same manner and to
the same extent that the Company would be required to perform it if no such
succession had taken place; and nothing in this Agreement shall prevent the
consolidation, merger or sale of the Company or a sale of any or all or
substantially all of its assets.
12
B. Binding
Effect. Subject to the foregoing restriction on assignment by
Executive, this Agreement shall inure to the benefit of and be binding upon each
of the parties; the affiliates, officers, directors, agents, successors and
assigns of the Company; and the heirs, devisees, spouses, legal representatives
and successors of Executive.
XI.
|
NOTICES
|
All
notices or other communications required or permitted hereunder shall be made in
writing and shall be deemed to have been duly given if delivered: (a)
by hand; (b) by a nationally recognized overnight courier service; (c) by United
States first class registered or certified mail, return receipt requested, to
the principal address of the other party, as set forth below or (d) by facsimile
(receipt confirmed). The date of notice shall be deemed to be the
earlier of (i) actual receipt of notice by any permitted means, or (ii) five
business days following dispatch by overnight delivery service or the United
States Mail. Executive shall be obligated to notify the Company in
writing of any change in Executive’s address. Notice of change of
address shall be effective only when done in accordance with this
paragraph.
Company’s
Notice Address:
GoFish
Corporation
000
Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx
Xxxxxxxxx, Xxxxxxxxxx, 00000
Facsimile:
(000) 000-0000
Executive’s
Notice Address:
[Omitted]
With a
copy to:
Frankfurt
Kurnit Xxxxx & Xxxx, PC
000
Xxxxxxx Xxxxxx, 00xx
xxxxx
Xxx Xxxx,
XX 00000
Attn.: Xxxxxxx
Xxxxxx
Facsimile:
(000) 000-0000
XII.
|
SEVERABILITY
|
If any
provision of this Agreement shall be held by a court or arbitrator to be
invalid, unenforceable, or void, such provision shall be enforced to the fullest
extent permitted by law, and the remainder of this Agreement shall remain in
full force and effect. In the event that the time period or scope of
any provision is declared by a court or arbitrator of competent jurisdiction to
exceed the maximum time period or scope that such court or arbitrator deems
enforceable, then such court or arbitrator shall reduce the time period or scope
to the maximum time period or scope permitted by law.
13
XIII.
|
TAXES
|
All
amounts paid under this Agreement (including without limitation Base Salary or
Severance) shall be paid less all applicable state and federal tax withholdings
and any other withholdings required by any applicable jurisdiction.
Notwithstanding any other provision of this Agreement to
the contrary, if Executive is a “specified
employee” within the meaning of Section 409A of the Internal
Revenue Code of 1986, as amended (the “Code”) and the related
guidance (“Section 409A”) at the time of
Executive’s separation from service, then only that portion of the
severance benefits provided hereunder, together with any other severance
payments or benefits, that may be considered deferred compensation under Section
409A, which (when considered together) do not exceed the Section 409A Limit (as
defined below) and which qualify as separation pay under Treasury Regulation
Section 1.409A-1(b)(9)(iii), may be paid within the first six (6) months
following Executive’s separation from service in accordance with applicable
payment schedule set forth herein or, for payments or benefits not provided
under this Agreement, with the payment schedule applicable to each such other
payment or benefit. Otherwise, the portion of the severance benefits
provided herein, together with any other severance payments or benefits that may
be considered deferred compensation under Section 409A, that would otherwise be
payable within the six (6) month period following Executive’s separation from
service will be paid in a lump sum on the date six (6) months and one (1) day
following the date of Executive’s separation from
service (or the next business day if such date is not business
day). For purposes of this Agreement, “Section 409A Limit” means the lesser
of two (2) times: (i) the sum of Executive’s annualized
compensation based upon the annual rate of pay for services provided to the
Company for the taxable year preceding the taxable year of Executive’s separation from
service from the Company as determined under Treasury Regulation Section
1.409A-1(b)(9)(iii)(A)(1) and any related Internal Revenue Service guidance; or
(ii) the maximum amount that may be taken into account under a qualified plan
pursuant to Section 401(a)(17) of the Code for the year in which such separation
from service occurs.
If the
receipt by Executive of any payments, awards, grants or other amounts or
benefits pursuant to the terms of this Agreement (“Initial Amount”) result in a
tax under Sections 409A or 4999 of the Internal Revenue Code, or both, the
Company shall pay Executive an additional amount (the “Gross Up Amount”) so that,
after the reduction of tax (i) under those Sections (and corresponding
provisions of state and local law) on the Initial Amount and the Gross Up Amount
and (ii) any US federal, state and local income or payroll tax on the Gross Up
Amount, the amount retained by Executive is equal to the Initial Amount before
any US federal, state or local income or payroll tax on the Initial Amount. Any amounts payable pursuant to this
paragraph shall be paid to Executive no later than the end of
Executive’s taxable year next following Executive’s taxable year in
which Executive remits the related taxes.
XIV.
|
GOVERNING
LAW
|
This
Agreement shall be governed by and construed in accordance with the laws of the
State of California.
14
XV.
|
INTERPRETATION
|
This
Agreement shall be construed as a whole, according to its fair meaning, and not
in favor of or against any party. Sections and section headings
contained in this Agreement are for reference purposes only, and shall not
affect in any manner the meaning or interpretation of this
Agreement. Whenever the context requires, references to the singular
shall include the plural and the plural the singular.
XVI.
|
COUNTERPARTS
|
This
Agreement may be executed in any number of counterparts, each of which shall be
deemed an original of this Agreement, but all of which together shall constitute
one and the same instrument.
XVII.
|
AUTHORITY
|
Each
party represents and warrants that such party has the right, power and authority
to enter into and execute this Agreement and to perform and discharge all of the
obligations hereunder; and that this Agreement constitutes the valid and legally
binding agreement and obligation of such party and is enforceable in accordance
with its terms.
XVIII.
|
ENTIRE
AGREEMENT
|
This
Agreement is intended to be the final, complete, and exclusive statement of the
terms of Executive’s employment by the Company, except for agreements
specifically referenced herein (including the Indemnity Agreement and any
applicable stock option agreement, applicable restricted stock unit agreement or
other similar Company plan document), and may not be contradicted by
evidence of any prior or contemporaneous statements or agreements. To
the extent that the practices, policies or procedures of the Company, now or in
the future, apply to Executive, and to the extent that any applicable stock
option agreement, applicable restricted stock unit agreement or similar Company
plan document, are inconsistent with the terms of this Agreement, the provisions
of this Agreement shall control. Any subsequent change in Executive’s
duties, position, or compensation will not affect the validity or scope of this
Agreement.
XIX.
|
EXECUTIVE
ACKNOWLEDGEMENT
|
EXECUTIVE
ACKNOWLEDGES THAT HE HAS HAD THE OPPORTUNITY TO CONSULT LEGAL COUNSEL CONCERNING
THIS AGREEMENT, THAT HE HAS READ AND UNDERSTANDS THE AGREEMENT, THAT HE IS FULLY
AWARE OF ITS LEGAL EFFECT, AND THAT HE HAS ENTERED INTO IT FREELY BASED ON HIS
OWN JUDGMENT AND NOT ON ANY REPRESENTATIONS OR PROMISES OTHER THAN THOSE
CONTAINED IN THIS AGREEMENT.
15
IN WITNESS WHEREOF, the
parties have duly executed this Agreement as of the date first written
above.
GOFISH CORPORATION | Xxxx Xxxxxxx | ||||
By: |
/s/
Xxxxxxx Xxxxxx
|
/s/
Xxxx Xxxxxxx
|
|||
Name | Xxxxxxx Xxxxxx |
|
|||
Title
|
President |