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EXHIBIT 10.13
EMPLOYMENT AGREEMENT
XXXX X. XXXXXXXXXX
This is an agreement, effective during the period of March 24, 1999 through
December 31, 1999, between Xxxx X. Xxxxxxxxxx, an individual residing at 00
Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000, ("Employee") and WP Holding, Inc.,
of 000 Xxxx Xxxx Xxxxxxx, Xxxxx 000, Xxxxxx Xxxxx, XX 00000 ("Company" or
"Employer").
1. Services. Employer wishes to retain the services of Employee to act as a
member of its Board of Directors and to perform other duties, including, but not
limited to, advising and consulting Employer in strategic and business
development matters relative to the Company's List Partner Program, and Employee
is willing to provide such services. Employee agrees that during the term of
this Agreement, he will render to Employer such services as Employer may request
relating to list partner program creation, subscriber acquisition, strategic
marketing and business development.
2. Payment to Employee.
(a) Base Salary. Employer agrees to pay Employee for such services a base
salary of $12,000 for each month of work, which payments shall be made
semi-monthly. Subject to the provisions of Section 7 hereof, Employee
and Company contemplate this agreement shall expire December 31, 1999.
(b) Bonus. Employee shall be eligible for a bonus of up to twenty five
percent (25%) of the base salary earned during any calendar quarter
for meeting goals which will be reasonably established on or before
April 15, 1999 by the Company (the "Defined Goals") for the 2nd (March
24-June 30), 3rd (July 1-Sept. 30) and 4th (Oct. 1-Dec. 31) calendar
quarters of 1999. Said goals shall be related to the number of List
Management and related agreements, and the number of list subscribers
within these agreements.
(c) Reimbursement of Costs. Upon adequate substantiation, Employer will
reimburse Employee for all travel and related expenses incurred by
Employee on Employer's behalf. During the course of rendering services
to the Company, it is anticipated that Employee will attend major
industry shows, to be approved in advance by Employer, such as PC
forum, Internet World, Agenda, and Camp Interactive, which shall be
reimbursable expenses. In addition, Employee shall be reimbursed for
relocation travel and temporary living expenses incurred in Employee's
temporary housing in Chicago, Illinois in an amount of up to $1,000
per month for up to nine (9) months. Employee will be responsible for
additional apartment costs, security deposits, insurance, taxes, cable
television, local phone and other living type expenses.
Employee will provide local transportation (leased vehicle) and be
responsible for all operating expenses including lease, fuel,
insurance, taxes and additional local
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transportation charges tolls.
(c) Equity. For prior services as a member of the Company's predecessor Board
of Directors, Employee will be granted certain options to purchase shares
of Common Stock of the Company, or its successor, through the Company's
1999 Stock Option Plan (the "Plan"). For services under this Agreement,
Employee will be granted additional options to purchase shares of Common
Stock of the Company through the Plan equal to 0.38% of the Company's
Common Stock after the proposed Series A Preferred financing. These options
will be granted through a grant letter which will be on terms and
conditions consistent with other employees and consultants, as determined
by the Board of Directors. One half of such options shall vest monthly on a
straight-line basis over the term of the Agreement. The remaining one half
of such options shall vest, if at all, quarterly if Employee reaches the
Defined Goals, on a cumulative basis, for the applicable quarter. In case
of a Change of Control of the Company (as defined below), the options shall
accelerate in full and become immediately exercisable. The term "Change of
Control" shall mean and include any of the following: (i) a merger or
consolidation of the Company with or into any other corporation or other
business entity in which the Company is the surviving corporation (except
one in which the holders of capital stock of the Company immediately prior
to such merger or consolidation continue to hold at least a majority of the
outstanding securities having the right to vote in an election of the Board
of Directors ("Voting Stock") of the Company), or any such merger or
consolidation in which the Company is not the surviving corporation; (ii) a
sale, lease, exchange or other transfer (in one transaction or a related
series of transactions) of all or substantially all of the Company's
assets; (iii) the acquisition by any person or any group of persons (other
than the Company, any of its direct or indirect subsidiaries, or any
trustee, fiduciary or other person or entity holding securities under any
employee benefit plan or trust of the Company or any of its direct or
indirect subsidiaries) acting together in any transaction or related series
of transactions, of such number of shares of the Company's Voting Stock as
causes such person, or group of persons, to own beneficially, directly or
indirectly, as of the time immediately after such transaction or series of
transactions, 50% or more of the combined voting power of the Voting Stock
of the Company other than as a result of an acquisition of securities
directly from the Company, or solely as a result of an acquisition of
securities by the Company which by reducing the number of shares of the
Voting Stock outstanding increases the proportionate voting power
represented by the voting Stock owned by any such person to 50% or more of
the combined voting power of such Voting Stock; (iv) a change in the
composition of the Company's Board of Directors following a tender offer or
proxy contest, as a result of which persons who, immediately prior to a
tender offer or proxy contest, constituted the Company's Board of Directors
shall cease to constitute at least a majority of the members of the Board
of Directors; and (v) any liquidation, dissolution or winding up of the
Company (whether voluntary or involuntary).
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(d) Benefits. Employee shall be eligible to participate in any
health, dental, disability, profit sharing and retirement plans
of the Company, established from time to time, in accordance
with the rules of such plans and consistent with other employees
of the Company, except as limited or restricted due to
Employee's salary.
3. IPO Process Involvement. Employer agrees to use its reasonable efforts
to include Employee in the Company's activities which are directly
related to the process of initiating and completing, if any, the
Company's Initial Public Offering. The list of activities and terms
under which Employer agrees to include Employee, as practicable and at
Employer's sole discretion, is provided on Exhibit A. Employee shall be
included in the IPO Process, as provided on Exhibit A, for a period
through April 30, 2000, or upon earlier termination of this Agreement as
provided elsewhere in the Agreement.
4. Binding Authority. Employee shall have no authority to bind Employer or
incur other obligations on behalf of Employer.
5. Intellectual Property. Employee will promptly disclose to Employer each
discovery which he reasonably believes may be new or patentable,
conceived by him in carrying out the services contracted for herein.
Employer shall have the right to file a patent, trade xxxx or any other
application relevant to the intellectual property, at Employer's
expense, on each discovery, and Employee agrees to cooperate with
Employer and to execute all proper documents at the expense of Employer
to enable Employer to obtain patent protection in the United States and
foreign countries.
6. Confidentiality In the event Employer discloses information to Employee
that Employer considers to be secret or proprietary and so notifies
Employee or if Employee reasonably believes such information to be
proprietary information, Employee agrees to hold the proprietary
information in confidence and to treat such proprietary information with
at least the same degree of care and safeguards that he takes with his
own proprietary information. Proprietary information shall be used by
Employee only in connection with services rendered under this Agreement.
Proprietary information shall not be deemed to include information that
(a) is in or becomes in the public domain without violation of this
Agreement by Employee or (b) is rightfully received from a third entity
having no obligation to Employer and without violation of this Agreement
by Employee. Employee agrees to return to Company all Proprietary
information upon termination of this Agreement.
7. Representations and Warranties of Employee. Employee warrants that he
is under no obligation to any other entity that in any way conflicts
with this Agreement, that he is free to enter into this Agreement, and
is under no obligation to consult for others in matters related to
Internet marketing. Employee shall not, during the term of this
Agreement,
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perform services for others in the field of Internet marketing.
8. At-Will Employee. This agreement clarifies certain rights and duties of
Employer and Employee. Notwithstanding anything else contained herein, this
agreement may be terminated at any time by Employer, in Employer's sole
discretion. Employee recognizes that he is employed as an "at-will"
employee and that this agreement may be terminated at any time and at
Employer's sole discretion. In the event that Employee is terminated for
reason other than cause, Employee shall receive 30 days severance of Base
Salary and 60 days reimbursement of $1000 per month temporary living
expenses. In addition, if Xxxxx Xxxxxx ceases to be Company CEO, or if
Company determines that it will not pursue List Partner management
relationships (which decision shall represent a specific change in Company
strategy), Employee shall have the option to terminate this Employment
Agreement and receive Base Salary and $1000/month temporary housing
allowance for the balance of the term of the Agreement (through 12/31/99).
9. Assignment. This Agreement is not assignable by either party without the
consent of the other.
10. Arbitration. Any disputes under this agreement, including those relating to
non-competition shall be submitted to arbitration with a single arbitrator
under the rules of the American Arbitration Association. Any ruling made by
the arbitrators shall be final and may be entered as a judgment in any
court of competent jurisdiction.
11. Non-Solicitation of Customers. Employee shall not solicit any customer of
the Company, including any past customers of the Company who have done
business with the Company during the past three years, to purchase any
product or service which could be supplied by the Company.
12. Non-Solicitation of Employees. Employee shall not solicit any employees of
the Company to perform any act in contravention of this Agreement or to
terminate their employment with the Company.
13. Non-Interference. Employee shall not take any action to harm the Company or
its products and shall not take any action, at any time, which is designed
to hamper the productivity of the Company.
14. Injunctive Relief for Company. In the event of a breach or threatened
breach of this Agreement by Employee, the Company shall be entitled, in
addition to any other relief provided at law or equity, an injunction
restraining Employee from disclosing confidential information, or
soliciting customers or employees.
15. Survival. The provisions of Sections 5, 6 and 9 through 15 hereof shall
survive any termination of this Agreement for a period of three (3) years
after such termination.
Agreed to and accepted on this the 31st day of March, 1999.
