EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is effective as of the 1st
day of January, 1997, is made by and between Third Wave Media Limited, a
California corporation (the "Company") and Xxxxxx Xxxxxx, an individual
("Employee").
RECITALS
A. Employee has developed considerable familiarity with and expertise
in the operations and business of media replication and has been involved in the
industry for a number of years.
B. The Company desires to maintain Employee's services and Employee and
the Company desire to provide for Employee's employment by the Company upon the
terms and conditions set forth in this Employment Agreement.
AGREEMENT
1. Employment. The Company hereby agrees to employ Employee and
Employee hereby agrees to serve the Company as its President and Chief Executive
Officer or in any other comparable position consistent with Employee's status,
as to which he may hereafter be elected or appointed during the Employment Term
(as hereinafter defined).
2. Employment Term. Employee's employment hereunder shall be for a term
of not less than seven (7) calendar years commencing on January 1, 1997 and
continuing to and including December 31, 2003 unless earlier terminated pursuant
to Sections 4 or 5 of this Agreement (the "Employment Term").
3. Responsibilities. During the Employment Term, Employee shall render
such services to the Company and its affiliates as are reasonably required by
the Board of Directors of the Company and as may be required by virtue of the
office(s) and positions held by Employee.
4. Incapacity. If during the Employment Term, Employee is prevented
from performing his duties or fulfilling any of his responsibilities by reason
of any incapacity or disability for a continuous period of not less than six (6)
months, then the Company, by majority vote of the Board of Directors, may
consider such incapacity or disability to be permanent and may, upon ninety (90)
days written notice to Employee, thereafter terminate Employee's employment
hereunder. However, notwithstanding any such termination, Employee shall
continue to be eligible to receive any benefits to which he may be entitled
under the terms of the Company's long term disability plan for its employees, if
any. In the event of such disability, the Company shall pay Employee the full
amount of the compensation otherwise payable under Section 6 by way of Base
Salary (as hereinafter set forth) until such termination and the sum of 25%
thereof, on a monthly basis, until such time as the first to occur of the end of
the Employment Term or death of Employee.
5. Death. The Employment Term, unless terminated earlier, shall
automatically terminate on the last day of the month in which the death of
Employee occurs. Employee's estate, or heirs as applicable, shall be paid any
and all accrued and unpaid Base Salary and Incentive Compensation, as such terms
are hereinafter defined, to the date of Employee's death plus, by way of lump
sum payment, the additional sum of 25% of the remaining Base Salary otherwise
payable hereunder throughout the remainder of the term of employment which would
otherwise apply irrespective of such death of Employee.
6. Compensation: Base Salary. As compensation for all services rendered
pursuant to this Agreement, the Company agrees to pay Employee a gross salary
("Base Salary") equal to no less than the following amounts for each calendar
year set forth below.
Year Base Salary (expressed annually)
1997 $ 50,000
1998 $ 75,000
1999 $ 100,000
2000 $ 125,000
2001 $ 150,000
2002 $ 175,000
2003 $ 200,000
Base Salary shall be paid not less often than monthly. Base Salary may be paid
more often as may be paid to other employees of the Company or as determined by
the Board of Directors of the Company. Any Base Salary unpaid when due shall
bear interest at the rate of the lesser of 10% per annum or the maximum rate
permissible by law.
7. Incentive Compensation. In addition to said Base Salary, Employee
shall be entitled to receive incentive compensation ("Incentive Compensation")
in the form of annual bonuses to be paid annually no later than the fifteenth
(15th) day of the second month following the close of each calendar year of
employment or as otherwise mutually agreed upon between Employee and the Board
of Directors of Company. Incentive Compensation shall be not less than the sum
of $25,000 for each and every $500,000 increase in gross sales of Company
comparing each calendar year of employment with the gross sales of the calendar
year prior. In no event shall Incentive Compensation result in a decrease in
Employee's compensation nor will decreases in gross sales be carried over from
year to year to diminish Incentive Compensation in later years. Any Incentive
Compensation not paid when due shall bear interest at the rate of the lesser of
10% per annum or the maximum rate permissible by law.
8. Expenses. During the Employment Term, the Company shall allow
Employee reasonable travel, business, entertainment, and other business expenses
incurred in the performance of his duties hereunder, subject to the rules and
regulations adopted by the Company for the handling of such business expenses
and consistent with IRS policies and procedures re deductibility.
9. Other Benefits. During the Employment Term, the Company shall
provide Employee, with not less than the same insurance and other benefits the
Company makes available to other similarly situated or executive employees.
Employee shall have the use of a Company car or the equivalent by way of a car
allowance consistent with his position within the Company.
10. Best Efforts. During the Employment Term, Employee shall devote
full time and best efforts to the performance of all responsibilities to the
Company and its affiliates and to further the businesses and interests of the
Company and its affiliates.
11. Indemnification. The Company agrees to indemnify, defend and hold
harmless Employee, his heirs, personal representatives, successors and assigns
from and against any claim for loss, damage, liability or cost (including
reasonable attorney's fees and expenses) asserted against or incurred by
Employee as a result of management, business operations and exercise of
corporate powers by Employee but not in any event for judicially established
criminal misconduct of Employee.
12. Benefit. This Agreement shall bind and inure to the benefit of
Employee, the Company, and their respective heirs, personal representatives,
successors, and assigns.
13. Notices.
(a) To the Company, if delivered to a director or the highest ranking
officer (excluding Employee) of the Company, or if mailed, certified or
registered mail, postage prepaid to the Company at its then current principal
executive office.
(b) To Employee, if delivered to Employee in person or if mailed, by
certified or registered mail, postage prepaid, to Employee's last known
residential address as maintained in the records of the Company.
14. Governing Law; Venue; Attorneys' Fees. This Agreement shall be
governed by and construed and enforced in accordance with the laws of the State
of California. Any action arising out of this Agreement shall be litigated in
the state courts of California and the prevailing party therein shall be
entitled to recover from the other party reasonable attorneys' fees, court costs
and expert witness fees as determined by the Court having jurisdiction over such
dispute.
15. Severability. The invalidity of any one or more of such provisions
of this Agreement shall not affect or limit the enforceability of the remaining
provisions or paragraphs of this Agreement unless an essential purpose of this
Agreement would be defeated by the invalid provision(s).
16. Headings. The headings in this Agreement are solely for convenience
of reference and shall not affect its interpretation.
17. No Waiver. No failure on the part of any party hereto at any time
to require the performance by any other party of any term of this Agreement
shall be taken or held to be a waiver of such term or in any way affect such
party's right to enforce such term, and no waiver on the part of either party of
any term of this Agreement shall be taken or held to be a waiver of any other
term hereof or the breach thereof.
18. Counterparts. This Agreement may be executed in separate
counterparts, each of which when so executed shall be an original but all of
such counterparts shall together constitute but one and the same instrument.
EXECUTED AND EFFECTIVE as of the date first written above.
THIRD WAVE MEDIA LIMITED
By:___________________________
Its: Sole Director
______________________________
Xxxxxx Xxxxxx, an individual
