EMPLOYMENT AGREEMENT
EMPLOYMENT
AGREEMENT (the “Agreement”), dated as of April 2, 2007 (the "Effective Date")
between Accoona Corp., a Delaware corporation (the “Company”), and Xxxxxxx X.
Xxxx (the “Executive”).
WHEREAS,
the Executive is the Chief Financial Officer and Treasurer of the Company and
a
member of the Board of Directors of the Company (the “Board”);
WHEREAS,
the Company and the Executive desire to enter into this Agreement to provide
for
the continued employment of the Executive by the Company upon the terms and
subject to the conditions set forth herein;
NOW,
THEREFORE, in consideration of the premises and the mutual agreements contained
herein, the parties hereby agree as follows:
1. Employment.
The
Company and the Executive agree that the Executive shall continue to be employed
by the Company upon the terms and subject to the conditions contained in this
Agreement. The term of employment of the Executive by the Company pursuant
to
this Agreement shall commence as of the Effective Date and, unless earlier
terminated or renewed pursuant to the terms hereof, shall end on the first
anniversary hereof (the “Initial Employment Period”), subject to renewal as
described below, and earlier termination as set forth in Section 4 hereof.
This
Agreement shall be subject to unlimited consecutive automatic renewals, each
for
a period of one year (the “Renewals”), unless either party hereto provides
written notice to the other party at least 90 days prior to each Renewal of
its
intention not to renew this Agreement. The Initial Employment Period and any
Renewals shall be referred to herein as the “Employment Period”.
2. Position
and Duties.
(a) The
Company shall employ the Executive in the position of Chief Financial Officer
and, subject to Section 10(c), Treasurer of the Company, and the Executive
shall
report directly to the Chief Executive Officer of the Company (the “CEO”). The
Executive shall perform such functions as may from time to time be designated
by
the CEO not inconsistent with such positions. During the Employment Period
the
Company shall nominate the Executive as a member of the Board. In the event
that
the Executive’s employment with the Company terminates for any reason, the
Executive agrees to resign from the Board upon the request of the Board. During
the Employment Period, the Executive shall perform the Executive’s duties
hereunder to the best of the Executive’s abilities, well and faithfully and at
the highest professional level. The Executive shall devote his full business
time, attention, skills and efforts to the affairs of the Company, and shall
use
his best efforts to promote the interests of the Company. Notwithstanding the
foregoing, the Executive may engage in charitable, civic or community activities
provided that they do not interfere with the performance of his duties
hereunder.
(b) Throughout
the Employment Period, the Executive’s duties will be performed primarily at the
Company’s offices in the New York City metropolitan area, including Jersey City,
New Jersey, as established by the Company, subject to the travel requirements
of
his position.
3. Performance
Review; Compensation.
(a) Performance
Review.
Annually, during the Employment Period the Executive shall receive a performance
review by the Board or the Compensation Committee. As part of the performance
review, the Board or the Compensation Committee shall: (x) establish Executive’s
base salary prospectively, (y) grant Executive such bonuses, if any, as
determined by the Board or the Compensation Committee in its sole discretion
for
the prior or current period and, in such reviewing party’s sole discretion,
establish the amount, if any, terms or performance requirements for any future
bonus, and (z) determine the amount and nature of employee benefits and fringe
benefits available to the Executive. Notwithstanding the foregoing, until such
time as the Executive receives a performance review within the meaning of this
Section 3(a) and the Board or Compensation Committee formally advises the
Executive of any changes in his compensation:
(i) During
the Employment Period, the Company shall pay to the Executive an annual base
salary at the rate of $275,000 per annum.
(ii) During
the Employment Period, the Executive shall be entitled to participate in the
Company’s employee benefit plans and fringe benefit arrangements that are
generally available from time to time to executives of the Company at the most
senior level, subject to the terms of such plans and arrangements and subject
to
the right of the Company to modify, revise or eliminate such benefit plans
and
arrangements from time to time in its sole discretion.
(iii) During
the Employment Period, the Executive shall be eligible for an annual bonus
equal
to 40% of his salary as determined by the Board in its sole discretion based
on
Executive’s performance.
The
Executive agrees that the Compensation under this Section 3 shall constitute
full compensation for all services rendered by the Executive during the
Employment Period. All payments of base salary shall be in accordance with
the
Company’s regular payroll practices and base salary and all other cash payments
hereunder shall be in U.S. Dollars.
(b) Vacation.
Executive shall be entitled to three (3) weeks of vacation per year with carry
over for one year.
(c) Expense
Reimbursement.
The
Company shall reimburse the Executive for all ordinary and reasonable
out-of-pocket business expenses reasonably incurred by the Executive in the
performance of the Executive’s duties hereunder in accordance with the Company’s
policies and procedures for its most senior executives. In addition, the
Executive shall be paid parking of $300 per month. The Executive shall submit
appropriate invoices for all expenses for which the Executive seeks
reimbursement.
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4. Termination;
Consequences of Termination of Employment Period.
(a) The
Executive’s employment may be terminated at any time during the Employment
Period(s) by the Company for Disability or with or without Cause and
(ii) by the Executive for Good Reason upon at least ninety (90) days
notice.
(b) If
(A)
the Executive’s employment is terminated prior to the end of the Employment
Period (i) by the Company other than for Cause (but not for death or Disability)
or (ii) by the Executive for Good Reason, or (B) if the Executive’s employment
is terminated due to the expiration of the Employment Period and the election
of
the Company not to renew the same, the Company’s obligations hereunder shall
cease as of the date of such termination, except that the Executive shall be
entitled to cash payments (the “Severance Payments”) in an aggregate amount
equal to the Executive’s base salary and benefits (or the cash equivalent value
thereof to Executive, which would be affected by Executive electing COBRA and
the Company reimbursing the Executive for the same) (but not any bonuses or
other compensation) for a period of twelve (12) months from the date of
termination to be paid to Executive in accordance with the regular payroll
practices of the Company. The Executive shall be under no obligation to mitigate
his damages or to seek other employment.
(c) If
the
Executive’s employment terminates for any other reason prior to end of the
Employment Period, including (A) by reason of death or Disability of the
Executive, (B) by the Company for Cause, or (C) by the Executive without Good
Reason, the Company’s obligations hereunder shall cease as of the date of such
termination, and the Executive shall not be entitled to any severance by virtue
of this Agreement or otherwise.
(d) In
the
event of any termination of Executive’s employment under this Section 4,
Executive (or his estate) shall be paid such portion of the Executive’s base
salary as has accrued by virtue of his service during the period prior to
termination and has not yet been paid, together with any amounts for expense
reimbursement and similar items which have been properly incurred in accordance
with the provisions hereof prior to termination and have not yet been
paid.
5. Federal
and State Withholding.
The
Company shall deduct from the amounts payable to the Executive pursuant to
this
Agreement the amount of all required federal and state withholding taxes in
accordance with the Executive’s Form W-4 on file with the Company and all
applicable social security and Medicare taxes.
6. Agreement
to Protect Confidential Information.
The
Executive has executed a separate Agreement to Protect Confidential Information,
Assign Inventions and Prevent Unfair Competition and Unfair Solicitation dated
the date hereof (the “Restrictive Covenant Agreement”). Said agreement is hereby
incorporated herein and made a part hereof by this reference.
7. Life
Insurance.
The
Company may, in its sole discretion, and at any time during the Employment
Period, apply for and procure as owner and for its own benefit insurance on
the
life of the Executive, in such amounts and in such form or forms as the Company
may choose. The Executive shall have no interest whatsoever in any such policy
or policies, but he shall, at the request of the Company, submit to such medical
examinations, supply such information, and execute such documents as may be
reasonably required by the insurance company or companies to whom the Company
has applied for such insurance. Upon the termination of Executive’s employment
by the Company, if the Company owns any life insurance policy on the Executive’s
life, the Executive shall have the option to acquire such life insurance from
such owner at a price equal to its cash surrender value, if any, at the date
of
the termination of the Executive’s employment, and if the Company owns any term
life insurance on the Executive’s life, the Executive shall have the option to
acquire such life insurance from such owner at a price equal to the prepaid
premium at the date of the termination of the Executive’s
employment.
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8. Arbitration;
Certain Costs.
Any
dispute or controversy between the Company and the Executive, whether arising
out of or relating to this Agreement, the breach or alleged breach of this
Agreement, or otherwise, shall be settled by arbitration in New York City
administered by the American Arbitration Association before a single arbitrator
in accordance with its Commercial Rules then in effect and judgment on the
award
rendered by the arbitrator may be entered in any court having jurisdiction
thereof. The arbitrator shall have the authority to award any remedy or relief
that a court of competent jurisdiction could order or grant, including, without
limitation, the issuance of an injunction. However, either party may, without
inconsistency with this arbitration provision, apply to any court having
jurisdiction over such dispute or controversy and seek interim provisional,
injunctive or other equitable relief until the arbitration award is rendered
or
the controversy is otherwise resolved. Except as necessary in court proceedings
to enforce this arbitration provision or an award rendered hereunder, or to
obtain interim relief, neither a party nor an arbitrator may disclose the
existence, content or results of any arbitration hereunder without the prior
written consent of the Company and the Executive. The Company and the Executive
acknowledge that this Agreement evidences a transaction involving interstate
commerce. Notwithstanding any choice of law provision included in this
Agreement, the United States Federal Arbitration Act shall govern the
interpretation and enforcement of this arbitration provision.
9. Notices.
All
notices and other communications required or permitted hereunder shall be in
writing and shall be deemed to have been duly given when personally delivered
or
five days after deposit in the United States mail, certified and return receipt
requested, postage prepaid, addressed (a) if to the Executive, to the most
recent address then shown on the employment records of the Company, and if
to
the Company, to Accoona Corp., 000 Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx Xxxx,
XX
00000 to the attention of the Chairman of the Board of Directors, with a copy
to
Xxxxxx X. Xxxx, Loeb & Loeb LLP, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
or (b) to such other address as either party may have furnished to the other
in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
10. Certain
Definitions.
The
following terms shall have the following meanings for purposes of this
Agreement:
(a) “Cause”
means (i) Executive’s continued willful failure or refusal to perform written
directives of the CEO, the Vice Chairman, the Chairman of the Board or the
Board
regarding Executive’s duties and responsibility which are not contrary to the
scope and nature of Executive’s duties and responsibilities as set forth in
Paragraph 2(a) hereof, which failure or refusal is not cured within 10 days
after written notice thereof to Executive, (ii) the willful engaging by
Executive in conduct that is, or that the Board determines in good faith is
reasonably likely to be, materially injurious to the business, reputation,
character or community standing of the Company, which failure has not been
cured
within 10 days after written notice thereof to the Executive by the Company,
(iii) any act of dishonesty, fraudulent or unethical conduct or moral turpitude
affecting, or which in the good faith judgment of the Board, reasonably might
materially adversely affect, the Company, (iv) Executive’s conviction in a court
of law or plea of nolo contendere to any felony, or (v) a material breach by
the
Executive of any material term of this Agreement or the Restrictive Covenant
Agreement, provided if such breach is susceptible of cure, such breach is not
cured within 10 days after written notice thereof to the Executive by the
Company.
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(b) “Disability”
means the Executive having become unable to perform regularly Executive’s duties
hereunder by reason of illness or incapacity for a period of more than 60
consecutive days or a total of 120 days, even if not consecutive, within any
period of 360 consecutive days. If there should be a dispute between the parties
hereto as to the Executive’s physical or mental disability for purposes of this
Agreement, the question shall be settled by the opinion of an impartial
reputable physician or psychiatrist agreed upon for the purpose by the parties
or their representatives, or of the parties cannot agree within fifteen (15)
days after a request for designation of such party, then each party shall
designate a physician or psychiatrist and the two of them shall designate a
third such medical professional and the opinion of a majority of the three
(3)
of them shall settle the question. The certification of such physician or
psychiatrist or the majority of the three (3) of them, as the case may be,
as to
the question in dispute shall be final and binding upon the parties
hereto.
(c) “Good
Reason” means the occurrence, without the Executive’s express written consent,
of any of the following events: (i) removal as the Chief Financial Officer
but
not as Treasurer of the Company; provided, that such failure or removal is
not
in connection with a termination of Executive’s employment hereunder (ii) any
material dimunition in the Executive’s duties, authority, responsibilities or
reporting relationships with respect to the Company except in connection with
the Company’s election of a third party as Treasurer, or assignment to the
Executive of any duties that are materially inconsistent with the Executive’s
position or duties described herein, provided such changes are not in connection
with the Executive’s termination of employment (iii) the Executive’s base
compensation is reduced and/or fringe benefits are materially reduced, and
(iv)
a change in the location of the principal offices of the Company to a location
outside of Jersey City, New Jersey or the New York metropolitan area, without
the consent of Executive. Notwithstanding the foregoing, an isolated,
insubstantial and inadvertent action taken by the Company in good faith that
is
remedied by the Company promptly (the earlier of 20 days or as soon as
reasonably practicable) after receipt of written notice thereof given by the
Executive shall not constitute a basis for Good Reason.
11. Indemnification.
The
Company agrees that, in addition to any rights that the Executive may have
under
the certificate of incorporation and by-laws of the Company as the same may
be
in effect from time to time hereafter as to indemnification and advancement
of
expenses, the Executive shall hereby, as a matter of separate contract, be
entitled and continue to be entitled to all rights of indemnification and
advancement of expenses provided to directors, officers, employees or agents
of
the Company or who serve or served at the request of the Company in any capacity
with any other corporation or other enterprise, under the certificates or
articles of incorporation and by-laws of the Company and such other companies
as
in effect on the date hereof (the provisions of which are incorporated herein
by
reference), regardless of any amendments thereto which thereafter occur, which
rights the Company expressly agrees shall apply to the Executive as a director,
officer, employee and agent of the Company, and which rights shall continue
indefinitely in the Executive’s favor as to any actions, suits, claims or
proceedings now pending or threatened and as to any actions, suits, claims
or
proceedings which may hereafter be brought or threatened.
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12. Severability.
Whenever possible, each provision of this Agreement shall be interpreted in
such
a manner as to be effective and valid under applicable law, but if any provision
of this Agreement is determined to be invalid, illegal or unenforceable in
any
respect under applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect the validity, legality or
enforceability of any other provision of this Agreement or the validity,
legality or enforceability of such provision in any other jurisdiction, but
this
Agreement shall be reformed, construed and enforced in such jurisdiction as
if
such invalid, illegal or unenforceable provision had never been contained
herein.
13. Entire
Agreement.
This
Agreement constitutes the entire agreement and understanding between the parties
with respect to the subject matter hereof and supersedes and preempts any prior
understandings, agreements or representations by or between the parties, written
or oral, which may have related in any manner to the subject matter hereof.
14. Successors
and Assigns.
This
Agreement shall be enforceable by the Executive and the Executive’s heirs,
executors, administrators and legal representatives, and by the Company and
its
successors and permitted assigns. This Agreement shall not be assigned by the
Company other than to a successor pursuant to a merger, consolidation or
transfer of all or substantially all of the capital stock or assets of the
Company. The Executive may not assign any of his duties under this
Agreement.
15. Governing
Law.
This
Agreement shall be governed by and construed and enforced in accordance with
the
internal laws of the State of New York without regard to principles of conflict
of laws.
16. Survival.
Sections 4-18 of this Agreement shall survive and continue in full force and
effect in accordance with its terms, notwithstanding any termination of the
Employment Period.
17. Amendment
and Waiver.
The
provisions of this Agreement may be amended or waived only by the written
agreement of the Company (upon the approval of the Board) and the Executive,
and
no course of conduct or failure or delay in enforcing the provisions of this
Agreement shall affect the validity, binding effect or enforceability of this
Agreement.
18. Counterparts.
This
Agreement may be executed in one or more counterparts, each of which shall
be
deemed to be an original and 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 as of the
date
first above written.
| ACCOONA CORP. | ||
| |
|
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| By: | /s/ Valentine X. Xxxxxx | |
|
Valentine X. Xxxxxx Its: Vice Chairman |
||
| EXECUTIVE: | ||
| |
|
|
| By: | /s/ Xxxxxxx X. Xxxx | |
|
Xxxxxxx X. Xxxx |
||
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