Executive Employment Agreement
This Employment Agreement (this
“Agreement”) is made and entered into as of January 28, 2009 (the “Effective
Date”) by and between Xxxxxx X. Xxxxxxxx (“Executive”), residing in New York,
New York, and Optionable, Inc. (the “Company” or the “Employer”), a Delaware
corporation, with offices at 00 Xxxxxx Xxxxxx, Xxxxx 00, Xxxxxxxx, XX
00000.
In consideration of the services to be
rendered by Executive pursuant to this Agreement, the compensation that Employer
hereby promises to provide to Executive therefor, and the mutual promises
contained herein, the parties agree as follows:
1. Employment. Employer hereby
agrees to employ Executive, and Executive agrees to be employed by Employer, on
the terms and conditions set forth in this Agreement.
2. Title; Services to be
Rendered. Executive shall be employed as President and Chief
Executive Officer of the Company, reporting to the Company’s Board of Directors,
and working primarily from offices to be located within the greater New York
metropolitan area. Executive shall be responsible for the Company’s
operations, including overall strategy, product development, customer
relationships, sales, administration, and finance. While employed by
the Company, Executive shall devote his full time, ability and attention to the
business of the Company on a regular, "best efforts," and professional
basis. Executive shall not, without the prior written approval of the
Company’s Board of Directors, become an officer, employee or consultant of, or
otherwise become associated with or engaged in, any business other than that of
the Company, and he will do nothing that is inconsistent with his duties to the
Company, or that has an adverse impact on his ability to perform his duties to
the Company. Notwithstanding the foregoing, Executive shall be
entitled to serve as adviser and director to Real Savvy Media, Inc. and Resort
Sports Network and retain any compensation and benefits resulting from such
service, so long as such service does not interfere with, and is not
inconsistent with, his duties under this Agreement and so long as such service
does not compete directly with the products and services provided by the
Company.
3. Base
Compensation. As compensation for the services to be rendered
by Executive under this Agreement, Employer shall pay Executive an annualized
salary of $150,000 (“Base Compensation”), minus withholdings and other
applicable deductions, starting on the Effective Date and payable from time to
time in accordance with the Company’s customary payroll
practices. The Base Compensation shall be subject to annual increases
as approved by the Company’s Board of Directors.
4. Signing Bonus; Incentive
Compensation.
(a) Executive will
be entitled to a signing incentive of $30,000 payable on the Effective Date of
the Agreement as compensation for expenses and lost income in connection with
Executive’s former advisory business.
(b) Executive
shall be eligible to receive annual incentive compensation (pro rated for 2009)
equal to an amount up to 100% of Executive’s Base Compensation (“Incentive
Compensation”). Incentive Compensation, if any, shall be payable to
Executive at the end of each fiscal year beginning with Fiscal Year 2009,
subject to withholdings and other applicable deductions, and shall be based upon
criteria established and approved by the Company’s Board of
Directors.
5. Benefits. Executive
shall be eligible for three weeks of paid vacation in each calendar
year. Executive shall be entitled to participate in all retirement,
disability, profit sharing, medical or life insurance and other similar such
policies, plans or programs provided by the Company, in accordance with the
terms of each such policy, plan and/or program as may be amended from time to
time (herein “Benefits”).
6. Equity Participation. As soon
as reasonably practicable after the Effective Date, the Company shall award
Executive 250,000 options to purchase shares of the Company’s common stock in
accordance with and subject to the terms of the Company’s presently existing
stock option plan. Said stock options and Executive’s right to
exercise them shall be governed by the Company’s stock option plan as it exists
as of the Effective Date and as it may be amended from time to time thereafter
in accordance with its terms.
7. Expenses. The
Company shall pay or reimburse Executive for reasonable travel or other expenses
incurred by Executive in connection with the performance of Executive's duties
hereunder. Executive shall maintain reasonably detailed records and
written receipts as required by Company policy to substantiate such
expenses. The Company also shall reimburse all reasonable legal
expenses that Executive incurs in connection with the negotiation and drafting
and execution of this Agreement.
8. Seat on Company’s Board of
Directors. Executive, who is presently a member of the
Company’s Board of Directors, shall continue to serve as a member of the
Company’s Board of Directors until and through the date of the 2009 annual
meeting of shareholders. For so long as Executive is employed as President and
Chief Executive Officer, the Company shall nominate Executive to serve on, and
Executive shall consent to be nominated to serve on, the Board of Directors, and
Executive shall serve on the Board of Directors if elected at any of the
Company’s annual meetings during the term of this Agreement. Notwithstanding
anything to the contrary in this section, upon the termination of Executive’s
employment with the Company for any reason, Executive shall tender his
resignation as a member of the Company’s Board of Directors and from any
position as an officer of the Company that he may then hold, and shall execute
any document reasonably requested by the Company for purposes of effectuating
such resignation.
9. Term; Termination. Executive’s
employment with the Company shall continue until it is terminated by either the
Executive or the Company in accordance with the terms of this Agreement. Each of Employer and
Executive may terminate Executive’s employment, at will, at any time for any
reason not prohibited by law, provided that the party terminating the
Executive’s employment provides 30 days’ advance notice to the other party.
Notwithstanding anything to the contrary in the foregoing sentence, the Employer
does not need to give any notice to Executive if the Employer terminates
Executive’s employment for Cause, defined below. If Employer terminates
Executive’s employment for Cause, except as required under applicable law,
Executive shall be entitled to no compensation other than base compensation and
Benefits through the last day of Executive’s employment (the “Termination
Date”). If Executive resigns his employment, with or without Good
Reason, except as required under applicable law, Executive shall be entitled to
receive only Base Compensation and Benefits through the Termination Date, plus
such other compensation and benefits as are expressly provided herein. For
purposes of this Agreement, "Cause" shall mean engaging in illegal conduct
(other than any misdemeanor, traffic violation or similar misconduct) in
connection with Executive’s performance of duties for the Company, Executive's
conviction of a felony or Executive’s material breach of section 11 or 12 of
this Agreement. For purposes of this Agreement, “Good Reason” shall
mean a material reduction in Executive's compensation and/or Benefits, a
material diminution in Executive's job responsibilities or position as President
and Chief Executive Officer of the Company, or the Company’s relocation of
Executive office location by more than 50 miles from New York
City. If, upon Executive’s resignation, Employer wishes to dispense
with Executive’s services before the effective date of resignation set forth in
Executive’s notice of resignation (the “Resignation Date”), Employer may
designate a Termination Date to a date earlier than the Resignation Date and
Executive’s employment shall terminate that day, but Employer shall continue to
pay Executive’s Base Compensation and provide Benefits for the period between
the Termination Date and the Resignation Date.
10. Severance
Pay. If Executive resigns his employment for Good
Reason, or if Employer terminates Executive’s employment for any reason other
than Cause, Executive shall be entitled to severance pay in an amount equal to
six months’ Base Compensation (minus withholding and applicable deductions) and
Benefits from the later of the Termination Date or the Resignation Date, plus an
amount equal to one half of any Incentive Compensation (minus withholdings and
other applicable deductions) which would have been due under Section 4 of this
Agreement had Executive continued working until the last day of the fiscal year
in which notice of resignation or the termination of Executive’s employment is
given and had the criteria for Incentive Compensation been met fully. At
Executive’s sole option, the base compensation portion of such severance pay
shall be paid to Executive either in a single lump sum within 10 days following
the Termination Date, or else as salary continuation and Benefits for six months
from the later of the Termination Date or the Resignation Date. The
Incentive Compensation-based portion of the severance pay shall be paid within
10 days following the Termination Date.
11. Confidential
Information. Executive understands and agrees that in the
course of Executive’s employment with the Company, Executive will acquire
confidential information concerning the Company’s business, industry, finances,
strategy, plans, contracts, intellectual and real property, technology,
personnel and other non-public information (collectively, “Confidential
Information”). Executive understands and agrees that such information
would be extremely damaging to the Company if disclosed to a competitor or a
third party. Executive understands and agrees that such information
will be divulged to Executive in confidence. Accordingly, Executive
shall not use for any purpose except for the benefit of the Company, nor
disclose to any person, firm, corporation or other entity without written
authorization of the Board of Directors of the Company, any Confidential
Information. For purposes of this Agreement, "Confidential
Information" shall include, without limitation, trade secrets, information
relating to any inventions, processes, formulae, plans, devices, compilations of
information, methods of distribution, customers, client relationships, or
marketing strategies of the Company.
12. Non-Solicitation. At
all times during Executive’s employment with the Company, and for the 12-month
period that starts on Executive’s Termination Date, Executive shall not,
directly or indirectly, on Executive’s own behalf or on behalf of any other
person, firm, corporation or other entity (i) solicit any account that was a
client of the Company while Executive was employed by the Company, or (ii)
induce any employee of the Company to terminate employment with the
Company.
13. Non-Competition. At
all times during Executive’s employment with the Company, and during the
12-month period that starts on Executive’s Termination Date, Executive shall
not, neither directly or indirectly, nor individually or with others, start up,
establish, own more than five percent (5%) of the outstanding stock of, manage,
operate, control or advise, or join or participate in the ownership, management,
operation or control of, or be employed by, or act as a consultant or
independent contractor for, or be connected in any manner with, any business,
practice, service or enterprise that competes directly with the products and
services provided by the Company.
14. Assignment of
Inventions. Executive shall disclose to the Company, and
hereby sells, transfers and assigns to the Company or its designee, all right,
title, and interest in and to any and all inventions, original works of
authorship, developments, concepts, improvements or trade secrets, whether or
not patentable or registrable under copyright or similar laws, and other
intellectual property which Executive may solely or jointly conceive or develop
or reduce to practice during the course of Executive’s employment by the Company
and relating to the business of the Company (collectively referred to as
"Inventions”). All such original works of authorship are "works made
for hire” and the Company or its designee shall own all rights
therein.
15. Indemnification. Employer
shall indemnify Executive, defend him, and hold him harmless to the fullest
extent permitted by law and the by-laws of the Company, from and against all
claims asserted against Executive relating to or arising from Executive’s
performance of any services hereunder or as a director and, subject to the
Company’s receipt of a satisfactory undertaking to reimburse the Company for any
amounts improperly advanced, the Company shall advance amounts sufficient to
cover Executive’s legal fees in connection with his defense or resolution of the
case or controversy giving rise to indemnification. By signing below,
Executive represents expressly that he has no obligations that conflict with or
are inconsistent with the obligations in this Agreement.
16. Arbitration. The
parties shall arbitrate any dispute, claim or controversy that may arise between
them related to Executive’s employment by the Company or any interpretation or
alleged breach of this Agreement, whether sounding in tort, contract, statutory
violation or otherwise, or involving the construction or application or any of
the terms, provisions, or conditions of this Agreement. The parties
agree that if any arbitration is brought to enforce any provision of this
Agreement, the prevailing party in such arbitration shall be entitled to its
reasonable attorneys’ fees and costs as part of any judgment or award plus
simple interest at an annual rate of 9% on the amount of any judgment or award
measured from and after the original date of the breach, action or inaction
giving rise to such dispute, claim or controversy. The arbitration
shall be conducted pursuant to the National Rules for the Resolution of
Employment Disputes promulgated by the American Arbitration Association in
effect at the time arbitration is demanded. The arbitration
provisions of this Agreement shall be strictly construed to provide for
arbitration as the sole and exclusive means for resolution of all disputes
hereunder, and questions of arbitrability shall be determined by the
arbitrator. The parties expressly waive any entitlement to have such
controversies decided by a court or a jury.
17. Governing Law. This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York without giving effect to the principles of conflicts of
law.
18. Representation by
Counsel. Each party acknowledges that it or he has read and
understands all of the provisions of this Agreement and has had the opportunity
to consult legal and other advisors of its or his choice prior to entering into
this Agreement.
19. Miscellaneous. This
Agreement shall be binding upon and inure to the benefit of the parties
hereto. If for any reason any provision of this Agreement shall be or
become illegal or unenforceable, then the remaining provisions shall remain
valid and binding on the parties according to their terms. This
Agreement contains the entire agreement of the parties with respect to the
subject matter of this Agreement and shall cancel and supersede all prior
agreements between the parties. All modifications to this Agreement
must be in writing, signed by the parties hereto. The failure of
either party to enforce any of the terms and conditions of this Agreement shall
not constitute a waiver of that party’s right thereafter to enforce each and
every term and condition of this Agreement or upon reasonable notice to require
correction of a default previously waived.
IN WITNESS WHEREOF, the
parties hereto have executed this Agreement as of the day and year first above
written.
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Executive:
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Employer:
Optionable,
Inc.
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/s/
Xxxxxx X.
Xxxxxxxx
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/s/
Xxxx-Xxxxx
Xxxxxxxx
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Xxxxxx
X. Xxxxxxxx
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Name:
Xxxx-Xxxxx Xxxxxxxx
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Title:
CFO
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