[EXHIBIT 10.2.3]
EMPLOYMENT AGREEMENT
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This Employment Agreement ("Agreement") is entered into as
of May 23; 2003, between Xxxxxxxx X. Lot man ("Employee"), 000
Xxxxx Xxxxx Xxxxxx, Xxxx 0, Xxx Xxxxxxx, Xxxxxxxxxx 00000, and
Film and Music Entertainment, Inc. ("Company"), 0000 Xxxxxxx
Xxxx Xxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx 00000, XXX, on
the following terms and conditions:
1. Engagement of. Services. Company wishes to retain the
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services of Employee in connection with certain matters relating
to Company's business, as more fully described in Section 3
hereof, and Employee is willing to provide such services.
2. The term of this Agreement (the "Term") shall commence
as of the date set forth above and continue for a period of Five
(5) years, or upon thirty days' prior written notice from either
party.
3. Services to be Provided. Employee agrees that Employee
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will, on a non-exclusive basis and consistent with Employee's
other professional commitments render to Company such Employment
services as CFO, Vice President Finance and Secretary of the
Board of Directors of Company. Employee further agrees at all
times not to engage in conduct which will disparage the
reputation of Company and/or Company's technology, products and
services or which might tend to adversely affect the market
price of Company's common stock. Employee shall not be required
at any time to render services that would materially interfere
with Employee's prior professional obligations.
4. Compensation. All compensation provided for under this
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section 4 shall be provided on a "Most Favored Nations Basis"
with that of Xxxx Xxxx and or the President
4.1 Base Sa1ary Provided Employee shall faithfully and
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completely perform the services required hereunder and otherwise
fulfill his obligations under this Agreement. Company shall pay
Employee, as full compensation for the services requested of
Employee hereunder
(a) For all work performed at the rate of Dollar
($ .00) per year
(b) In addition to the Base Salary, the Company, at its
own discretion and with the approval of the Compensation
Committee of the Board of Directors, provide Employee with a
cash, or non-cash bonus.
(c) All compensation under this section shall be payable
in accordance with Employer's normal practices.
4.2 Options. The Company will, upon execution of
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this Agreement, grant Employee options pursuant to the Non-
Qualified Stock Option Agreement attached hereto and
incorporated herein as "Exhibit B", purchase One Million Six
Hundred Thousand (1,600,000) shares of the common stock of the
Company restricted under Rule 144 of the United States Security
and Exchange Commission. exercisable at a price of Fifty (50% )
of the closing price of May 6, 2003, and pursuant to the terms
embodied in the Xxxxxxxx X. Xxxxxx/Film and Music Entertainment,
Inc. Voting Trust Agreement attached hereto as "Exhibit A"
becoming a part of the whole hereof. Options granted hereunder
shall be considered "Dripped Out" pursuant to and in compensation
for the work performed under this Agreement for the period ending
prior to the Drip Out date as specified in Section 3 of Exhibit A.
4.3 Benefits. During the Employment Term, Employee
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shall be entitled to participate in all benefit plans available
to other employees of Employer of similar stature on terms no
less favorable than provided to any other employee of similar
stature.
5. Expenses.
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(a) In General. Employee may incur various costs and
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expenses in performing his services under this Agreement.
Company agrees to pay for only those reasonable costs and
expenses by prior written agreement of the Company.
(b) Out of Town Travel. Company agrees to pay
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transportation, meals, lodging and all other costs of any
necessary out-of-town travel by Employee (with air travel to be
coach class for Employee). Prior written approval by Company
shall be required for all air travel in connection with this
Agreement.
Employee shall invoice Company promptly for the foregoing
expenses. Such invoices shall be payable within 30 days of
receipt.
6. Termination for "Cause"
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Employer may terminate Employee's employment for "cause" as
defined in this section at any time upon written notice to
Employee. As used herein the term "cause" shall mean anyone or
combination of the following:
(i) Employee's arrest for or conviction of any crime
(whether or not involving Employer) which constitutes a crime of
moral turpitude or is punishable by imprisonment of one year or
more.
(ii) Employee's act or omission or act constituting
fraud, dishonesty or misrepresentation, whether prior or
subsequent to the date hereof, including without limitation any
fraud dishonesty or misrepresentation relating to Employee's
hiring by Employer.
(iii) Any act or omission by Employee involving willful
malfeasance or willful gross negligence or constituting a
material breach of this Agreement.
(iv) Employee's failure, inability (which does not
qualify as a disability under federal or state law), or refusal
to perform Employee's duties in a manner satisfactory to
Employer. Employer's good faith judgment as to Employee's ability
to perform Employee's duties shall be controlling.
(v) Employee's violation of any material rule or
regulation of Employer applicable to other Employees of similar
stature.
Notwithstanding the foregoing, Employee shall not be deemed
in breach of this provision unless and until Employer shall have
given Employee written notice describing the breach and Employee
shall have failed to cure the breach within three (3) business
days after Employee's receipt of that written notice, provided
that there shall be no cure period with respect to any matter
incapable of being cured. Employee shall not be required to give
a second notice and opportunity to cure with respect to any
breach by Employee.
7. Offset. Employee authorizes and agrees that Employer
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retains the right of offset and may deduct from the compensation
payable to Employee under this Agreement the amount of any debts
owed by Employee to Employer including, but not limited to, any
outstanding loans, unpaid advances and the value of any Employer
property retained by Employee.
8. Confidentiality. In connection with Employee's services
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hereunder, Company will be disclosing to Employee certain
confidential information all of which Company considers to be
secret or proprietary ("Proprietary Information"), and Employee
agrees, during the Term and forever after the expiration or
termination of this Agreement. to hold the Proprietary
Information in confidence, and not to disclose such Proprietary
Information to third parties (except pursuant to judicial
process) or to use such Proprietary Information for Employee's
own account, without Company's prior written authorization.
Proprietary Information shall be used
by Employee only in connection with services rendered pursuant
to 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 already in the possession of Employee, as evidenced by
written documents, prior to the disclosure thereof by Company,
or (c) is rightfully received from a third entity having no
obligation to Company and without violation of this Agreement by
Employee. Employee shall not issue any publicity or statements
to the press or third parties regarding Company, or its
technology, products or services, without Company's prior
written consent in each instance.
9. Company's Duties. Company agrees to cooperate with
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Employee, to abide by this Agreement, and to pay Employee's bills
on time.
10. Warranties. Employee warrants that Employee is under no
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obligation to any third party that would prevent Employee from
rendering the services contemplated by this Agreement, and that
Employee is free to enter into this Agreement Company warrants
that Company is under no obligation to any third party that
would prevent Company from performing its obligations under this
Agreement and that Company is free to enter into this
Agreement
11. Indemnity. Employee will indemnify and hold harmless
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Company from any and all liabilities, Costs, and expenses
(including attorney's fees) incurred by reason of any breach of
this Agreement by Employee. The Company will indemnify and hold
harmless Employee from any and all liabilities, costs, and
expenses (including attorney's fees) incurred by reason of any
breach of this Agreement by Company.
12. Injunctive Relief. In the event of any breach or an alleged
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breach of this Agreement by Company, it is acknowledged that
Employee's rights and remedies shall be strictly limited to the
right of Employee to recover damages in an action at law, and in
no event shall Employee be entitled to rescind this Agreement.
revoke any of the rights herein granted or to equitable or
injunctive relief, including without limitation specific
performance.
13. Notices. Any notice required or permitted to be given
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hereunder sha11 be in writing and sha11 be personally delivered,
including by messenger or courier (e.g. delivery by Federal
Express or other similarly recognized air express company), or
by certified or registered mail, return receipt requested,
postage prepaid. to Employee at the address previously
inscribed or to Company at Pervasys. Inc.. 0000 Xxxxxxx
Xxxx Xxxx. Xxxxx 0000. Xxx Xxxxxxx. Xxxxxxxxxx 00000.
USA, with a copy to Alexander. Nau. Xxxxxxxx & Xxxxxx. LLP.
Attention: Xxxxxx X. Nan. 0000 Xxxxxxx Xxxx Xxxx. Xxxxx 0000.
Xxx Xxxxxxx. Xxxxxxxxxx 00000. USA. Any party may change its
address for notices hereunder by giving written notice in the
manner provided for herein.
14. Disability. If Employee becomes "Materially Disabled"
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(as defined in this Section) during the Employment Term,
Employer may, at its election, terminate this Agreement, except
that Employee's obligations under Sections 9, 11, and 12 of this
Agreement shall survive any such termination. "Material
Disabled" shall mean any instance where employee becomes
unable, as a result of a serious health condition (other
than pregnancy-related disability), to render full services as
contemplated by this Agreement for any period totaling more than
four (4) weeks in the aggregate during any twelve (12) month
period. In the event of termination pursuant to this Section 14,
Employer shall thereupon be released and discharged from all
further obligations under this Agreement, except for any vested
benefits and unpaid Base Sa1aIy for time worked.
15. Death. In the event of Employee's death, this Agreement
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shall terminate, and Employee shall thereupon be released and
discharged from all further obligations under this Agreement,
except for any vested benefits and unpaid earned Base Salary for
time worked.
16. Entire Agreement. This Agreement constitutes the entire
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agreement between the parties. No modification or amendment of
this Agreement Shall be binding unless executed in writing by all
the parties.
17. Assignability. This Agreement is not assignable by
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either party without the prior written consent
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18. Severability. If any provision of this Agreement is
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declared invalid, illegal or incapable of being enforced, all of
the remaining provisions of this Agreement sl1all nevertheless
continue in full force and effect.
19. Arbitration. Any dispute, controversy or claim arising
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out of or relating to the enforcement, interpretation or alleged
breach of this Agreement. or the services rendered pursuant to
this Agreement, shall be submitted to and resolved by binding
arbitration in Los Angeles, California in accordance with the
Commercial Arbitration Rules of the American Arbitration
Association, and judgment upon the award rendered by the
arbitrator may be entered in and enforceable by any court having
jurisdiction.
20. Choice of Law. This Agreement shall be construed and
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enforced in accordance with the laws of the State of California,
United States of America..
In Witness Thereof, the undersigned have executed this Agreement
as of the date first set forth above
Xxxxxxxx X. Xxxxxx
("Employee")
By: /s/Xxxxxxxx Xxxxxxx
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("Company")
Film and Music Entertainment, Inc.
By: /s/Xxxx Xxxx
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Its: President
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