Exhibit 10.53
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EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into as of
this 1st day of January, 1999, by and between UNITED INTERNET TECHNOLOGIES,
INC., a Delaware corporation (the "Company"), and XXXXX XXXXXXX ("Employee"),
with reference to the following facts:
A. Employee has been serving as a consultant to the Company in a
satisfactory and capable manner pursuant to an oral agreement between Employee
and the Company.
B. The Company has requested that Employee enter into a written
employment agreement with the Company with respect to matters relating to
employment with the Company, and Employee has agreed to do so, upon the terms
and conditions set forth herein.
NOW, THEREFORE, in consideration of the terms and conditions and the
mutual agreements and covenants set forth herein, the parties hereto agree as
follows:
1. SCOPE OF EMPLOYMENT.
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1.1 Capacity. Company hereby continues to employ Employee and
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Employee hereby accepts continued employment as President of the Company.
Employee shall report to the Board of Directors of Company and perform the
services and duties customarily incident to such office and as otherwise decided
upon by the Board of Directors.
1.2 Devotion of Services. Employee shall devote his entire
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productive time, ability and attention exclusively to the business of Company,
including the needs of the licensees of the Company's technology, as reasonably
required from time to time, during the term of this Agreement, except for
passive investments, charitable and non-profit enterprises and any other
business investments which do not interfere with his duties hereunder and which
are not competitive with Employer's activities (except as the owner of less than
2% of the issued and outstanding capital stock of a publicly traded
corporation), and except for involvement in United Leisure Corporation, the
parent of the Company, and United Film Distributors, Inc., for which Employee
may devote such time as necessary, provided that it does not interfere with his
duties to the Company hereunder. Employee shall perform and discharge well and
faithfully those duties assigned him by the Company. Employee shall perform his
services under this Agreement in Los Angeles County, California, or such other
location as is acceptable to Employee.
2. TERM. Subject to Section 6 herein, the initial term of this
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Agreement shall commence as of the date of this Agreement and shall continue and
remain in full force and effect for a period of five (5) years. The term of
this Agreement shall be extended at the end of each year of its term for an
additional one-year period unless either party gives the other written notice of
intention to terminate the Agreement at the end of its then current five-year
term, such notice to be
given at least 60 days prior to the end of the completion of the first year of
the five-year term then in effect. For example, if no notice of termination is
given by either party during the first full year of this Agreement, but it is
intended by one party that this Agreement terminate at the earliest possible
date, written notice of such termination must be given at least 60 days before
December 31, 2000 in order that this Agreement terminate on December 31, 2005.
3. COMPENSATION.
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3.1 Salary and Bonus. In consideration of the services to be
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rendered by Employee hereunder, including without limitation any services
rendered as an officer or director of the Company or any subsidiary or affiliate
thereof, during the term of this Agreement, the Company shall pay to Employee
the following:
(a) A salary in the initial amount of $240,000.00 per annum (the
"Base Salary"). Employee shall be entitled to an increase in Base Salary of 10%
per annum, effective on January 1 of each year of the term of this Agreement.
(b) The Board of Directors may, in its sole and absolute
discretion, grant Employee a bonus from time to time, in such amount and in such
form, as the Board of Directors shall determine.
(c) All payments to Employee shall be subject to the regular
withholding requirements of all appropriate governmental taxing authorities.
(d) If the Company's Board of Directors and/or any committee
thereof grants options to senior members of management of the Company and/or its
subsidiaries, the Board of Directors and/or such committee shall consider in
good faith granting a reasonable amount of options to Employee.
3.2 Other Benefits. Employee shall be entitled to participate
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in any medical and insurance plan which the Company is presently providing or
may provide to its senior executives. Employee acknowledges that the terms of
such plans may change from time to time. Furthermore, Employee shall be entitled
to receive the same automobile, life insurance policy and all other benefits
which he presently is receiving.
3.3 Expenses. The Company will advance to or reimburse Employee
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for all reasonable travel and entertainment required by the Company and other
reasonable expenses incurred by the Employee in connection with the performance
of his services under this Agreement in accordance with Company policy as
established from time to time.
4. INVENTIONS.
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4.1 Right to Inventions. Employee agrees that any discoveries,
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inventions or improvements of whatever nature (collectively "Inventions") made
or conceived by Employee, solely or jointly with others, during the term of his
employment with the Company, that are made with the Company's equipment,
supplies, facilities, trade secrets or time; or that relate, at the time
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of conception of or reduction to practice, to the business of the Company or the
Company's actual or demonstrably anticipated research or development; or that
result from any work performed by Employee for the Company, shall belong to the
Company. Employee also agrees that the Company shall have the right to keep any
such Inventions as trade secrets, if the Company so chooses. In order to permit
the Company to claim rights to which it may be entitled, Employee agrees to
disclose to the Company in confidence all Inventions that Employee makes during
the course of his employment and all patent applications filed by Employee
within three (3) years after termination of his employment. Employee shall (a)
assist the Company in obtaining patents on all Inventions deemed patentable by
the Company in the United States and in all foreign countries and (b) execute
all documents and do all things necessary to obtain letters patent to vest the
Company with full and extensive titles thereto and to protect the same against
infringement by others. For the purposes of this Agreement, an Invention is
deemed to have been made during the period of Employee's employment if the
Invention was conceived or first actually reduced to practice during that
period, and Employee agrees that any patent application filed within three (3)
years after termination of his employment with the Company shall be presumed to
relate to an Invention made during the term of Employee's employment unless
Employee can provide evidence to the contrary.
4.2 Assignment of Inventions and Patents. In furtherance of,
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and not in contravention, limitation and/or in place of, the provisions of
Section 4.1 above, the Company hereby notifies Employee of California Labor Code
Section 2870, which provides:
"Any provision in an employment agreement which provides that an
employee shall assign or offer to assign any of his or her rights in an
invention to his or her employer shall not apply to an invention for which
no equipment, supplies, facility, or trade secret information of the
employer was used and which was developed entirely on the employee's own
time, and (a) which does not relate (1) directly or indirectly to the
business of the employer or (2) to the employer's actual or demonstrably
anticipated research or development, or (b)which does not result from any
work performed by the employee for the employer. Any provision which
purports to apply to such an invention is to that extent against the public
policy of this state and is to that extent void and unenforceable."
Employee acknowledges that he has been notified by the Company of this
law, and understands that this Agreement does not apply to Inventions which are
otherwise fully protected under the provisions of said Labor Code Section 2870.
Therefore, Employee agrees to promptly disclose in writing to the Company all
Inventions, whether Employee personally considers them patentable or not, which
Employee alone, or with others, conceives or makes during his employment with
the Company or as is otherwise required and set forth under Section 4.1 above.
The Company shall hold said information in strict confidence to determine the
applicability of California Labor Code Section 2870 to said Invention and, to
the extent said Section 2870 does not apply, Employee hereby assigns and agrees
to assign all his right, title and interest in and to those Inventions which
relate to business of the Company and Employee agrees not to disclose any of
these Inventions to others without the prior written express consent of the
Company. Employee agrees to notify the Company in writing prior to making any
disclosure or performing any work during the term of his employment with the
Company which may conflict with any proprietary rights or technical know-how
claimed by Employee as his property. In the event that Employee fails to give
the Company
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notice of such conflict, Employee agrees that Employee shall have no further
right or claim with respect to any such conflicting proprietary rights or
technical know-how.
5. CONFIDENTIALITY.
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5.1 Restrictions on Use of Trade Secrets and Records. During
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the term of his employment, Employee will have access to and become acquainted
with various trade secrets of the Company, consisting of formulas, patterns,
devices, secret Inventions, processes, compilations of information, records and
specifications (collectively "Trade Secrets"), all of which are owned by the
Company and used in the operation of the Company's business. Additionally,
Employee will have access to and may become acquainted with various files,
records, customer lists, documents, drawings, specifications, equipment and
similar items relating to the business of the Company (collectively
"Confidential Information"). All such Trade Secrets and Confidential
Information, whether they are designed, conceived or prepared by Employee or
come into Employee's possession or knowledge in any other way, are and shall
remain the exclusive property of the Company and shall not be removed from the
premises of the Company under any circumstances whatsoever without the prior
written consent of the Company. Employee promises and agrees that he will not
use for himself or for others, or divulge or disclose to any other person or
entity, directly or indirectly, either during the term of his employment by the
Company or at any time thereafter, for his own benefit or for the benefit of any
other person or entity or for any reason whatsoever, any of the Trade Secrets or
Confidential Information described herein, which he may conceive, develop,
obtain or learn about during or as a result of his employment by the Company
unless specifically authorized to do so in writing by the Company.
5.2 Non-Interference. Employee recognizes that the Company has
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invested substantial effort in developing its technology and a list of present
and potential licensees and customers therefor. As a result, and particularly
because of the Company's many types of confidential business information,
Employee understands that any solicitation of a customer or employee of the
Company, in an effort to get them to change business affiliations, would
presumably involve a misuse of the Company's confidences, Trade Secrets and
Confidential Information. Employee therefore agrees that, for a period of one
(1) year from the later of the date of termination of Employee's employment with
the Company for any reason whatsoever or the receipt by Employee of any
compensation paid to Employee by the Company, Employee will not influence, or
attempt to influence, existing employees or customers of the Company in an
attempt to divert, either directly or indirectly, their services or business
from the Company.
6. TERMINATION OF AGREEMENT.
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6.1 Termination by the Company. The Company may terminate
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Employee's employment hereunder at any time for cause without payment of
severance or similar benefits. For purposes of this Section 6.1, "cause" shall
mean the following events: any willful breach of duty by Employee in the
course of his employment, the breach of any provision of this Agreement or any
misrepresentation by Employee hereunder, misconduct, neglect or negligence in
the performance of Employee's duties and obligations, disloyal, dishonest,
willful misconduct, illegal, immoral or unethical conduct by Employee, such
carelessness or inefficiency in the performance of his duties that Employee is
unfit to continue in the service of the Company, failure
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of Employee to comply with the policies or directives of the Company and/or
failure to take direction from the Company's Board of Directors, or such other
conduct which is substantially detrimental to the best interests of the Company.
Any such termination shall become effective upon delivery of written notice to
Employee.
6.2 Termination by Employee. Employee may terminate his
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employment hereunder at any time for cause. For purposes of this Section 6.2,
"cause" shall mean the breach of any provision of this Agreement by the Company
which is not cured within thirty (30) days after Employee delivers written
notice to the Company's Board of Directors describing such breach. If the
breach is not so cured within such thirty (30) days after delivery of such
notice, the termination of employment shall become effective after the
expiration of such cure period.
6.3 Death or Disability. Employee's employment with the Company
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shall cease upon the date of Employee's death and the Company shall be obligated
to pay to Employee's estate compensation only through the date of death. In the
event Employee becomes physically or mentally disabled so as to become unable
for more than one hundred eighty (180) days in the aggregate in any twelve (12)
month period to perform his duties on a full-time basis with reasonable
accommodations, the Company may, at its sole and absolute discretion, terminate
this Agreement, Employee's employment and its obligation to pay Employee from
and after the date of termination.
6.4 Effect of Termination. Upon the termination of Employee's
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employment hereunder or the expiration or termination of the Agreement, the
Company shall pay Employee all compensation accrued and outstanding as of the
date of such termination or expiration, and notwithstanding anything to the
contrary contained herein, the rights and obligations of each party under
Paragraphs 4, 5 and 8 herein shall survive such termination or expiration.
Notwithstanding anything to the contrary contained in this Agreement if, prior
to the end of any five (5) year term, Employer terminates this Agreement without
cause or Employee terminates this Agreement with cause, Employee shall continue
to receive all of the compensation and other benefits provided for in Paragraph
3 for the remainder of said then-current five (5) year term.
7. EMPLOYEE'S REPRESENTATIONS. As an inducement for the Company to
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execute this Agreement, Employee represents and warrants to the Company that the
negotiation, execution and delivery of this Agreement by Employee together with
the performance of his obligations hereunder does not breach or give rise to a
breach under any employment, confidentiality, non-disclosure, non-competition or
any other agreement, written or oral, to which Employee is a party.
8. EQUITABLE REMEDIES.
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8.1 Injunctive Relief. Employee acknowledges and agrees that
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the covenants set forth in Paragraphs 4 and 5 herein are reasonable and
necessary for protection of the Company's business interests, that irreparable
injury will result to the Company if Employee breaches any of the terms of said
covenants and that, in the event of Employee's actual or threatened breach of
said covenants, the Company will have no adequate remedy at law. Employee
accordingly agrees that in the event of actual or threatened breach of any of
such covenants, the Company shall be entitled to immediate injunctive and other
equitable relief, without bond and without the necessity
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of showing actual monetary damages. Nothing contained herein shall be construed
as prohibiting the Company from pursuing any other remedies available to it for
such breach or threatened breach, including the recovering of any damages which
it is able to prove. Each of the covenants in Paragraphs 4 and 5 shall be
construed as independent of any other covenants or provisions of this Agreement.
In the event of any judicial determination that any of the covenants set forth
in Paragraphs 4 and 5 herein or any other provisions of the Agreement are not
fully enforceable, it is the intention and desire of the parties that the court
treat said covenants as having been modified to the extent deemed necessary by
the court to render them reasonable and enforceable and that the court enforce
them to such extent.
8.2 Specific Enforcement. Employee agrees and acknowledges
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that he is obligated under this Agreement to render services of a special,
unique, unusual, extraordinary and intellectual character, thereby giving this
Agreement peculiar value, so that the loss thereof could not be reasonable or
adequately compensated in damages in an action at law. Therefore, in addition to
other remedies provided by law, the Company shall have the right, during the
term of this Agreement, to obtain specific performance hereof by Employee and to
obtain injunctive relief against the performance of service elsewhere by
Employee during the term of this Agreement.
9. GENERAL.
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9.1 Entire Agreement. This Agreement contains the entire
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understanding between the parties hereto and supersedes all other oral and
written agreements or understandings between them.
9.2 Amendment. This Agreement may not be modified, amended,
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altered or supplemented except by written agreement between Employee and the
Company.
9.3 Counterparts. This Agreement may be executed in two (2) or
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more counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
9.4 Jurisdiction. Each party hereby consents to the exclusive
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jurisdiction of the state and federal courts sitting in Los Angeles County,
California, in any action on a claim arising out of, under or in connection with
this Agreement or the transactions contemplated by this Agreement. Each party
further agrees that personal jurisdiction over him may be effected by service of
process by registered or certified mail addressed as provided in Section 9.9
herein, and that when so made shall be as if served upon him personally within
the State of California.
9.5 Expenses. In the event an action at law or in equity is
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required to enforce or interpret the terms and conditions of this Agreement, the
prevailing party shall be entitled to reasonable attorney's fees and costs in
addition to any other relief to which that party may be entitled.
9.6 Interpretation. The headings herein are inserted only as a
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matter of convenience and reference, and in no way define, limit or describe the
scope of this Agreement or
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the intent of any provisions thereof. No provision of this document is to be
interpreted for or against any party because that party or party's legal
representative drafted it.
9.7 Successors and Assigns. This Agreement shall be binding
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upon, and inure to the benefit of, the parties hereto and their heirs,
successors, assigns and personal representatives. As used herein, the
successors of the Company shall include, but not be limited to, any successor by
way of merger, consolidation, sale of all or substantially all of its assets or
similar reorganization. In no event may Employee assign any rights or duties
under this Agreement.
9.8 Controlling Law; Severability. The validity and
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construction of this Agreement or of any of its provisions shall be determined
under the laws of the State of California. Should any provision of this
Agreement be invalid either due to the duration thereof or the scope of the
prohibited activity, such provision shall be limited by the court to the extent
necessary to make it enforceable and, if invalid for any other reason, such
invalidity or unenforceability shall not affect or limit the validity and
enforceability of the other provisions hereof.
9.9 Notices. Any notice required or permitted to be given under
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this Agreement shall be sufficient if in writing and if personally received by
the party to whom it is sent or delivered, or if sent by registered or certified
mail, postage prepaid, to Employee's residence in the case of notice to
Employee, or to its principal office if to the Company. A notice is deemed
received or delivered on the earlier of the day received or three (3) days after
being sent by registered or certified mail in the manner described in this
Section.
9.10 Waiver of Breach. The waiver by any party hereto of a
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breach of any provision of this Agreement shall not operate or be construed as a
waiver of any subsequent breach.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
UNITED INTERNET TECHNOLOGIES, INC.
By: /s/ Xxxxx Xxxxxxx
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Title: Chief Executive Officer
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/s/ Xxxxx Xxxxxxx
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XXXXX XXXXXXX
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AGREEMENT
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AGREEMENT dated as of January 1, 1999, by and among United Leisure
Corporation, a Delaware corporation ("ULC"), United Internet Technologies, Inc.,
a Delaware corporation ("UIT") and a wholly-owned subsidiary of ULC, and Xxxxx
Xxxxxxx ("Xxxxxxx").
WHEREAS, UIT and Xxxxxxx have entered into that certain Employment
Agreement dated as of January 1, 1999 (the "Employment Agreement"); and
WHEREAS, Xxxxxxx is the President of UIT, and a director and principal
stockholder of ULC; and
WHEREAS, the parties wish to provide for certain other matters related to
Xxxxxxx'x employment and compensation;
NOW, THEREFORE, for good and valuable consideration, receipt of which is
hereby acknowledged, the parties hereto hereby agree as follows:
1. Pursuant to Section 1.2 of the Employment Agreement, Xxxxxxx is
permitted to engage in certain business activities other than his obligations to
serve as President of UIT, including involvement in ULC. Consistent with that
provision, UIT agrees to make available Xxxxxxx'x services to consult for ULC on
a variety of matters. Xxxxxxx consents to this arrangement.
2. For making available the services of Xxxxxxx as contemplated by
Paragraph 1 above, ULC agrees to pay to UIT the sum of $5,000 per month. No
portion of this amount shall be paid to Xxxxxxx, which Xxxxxxx expressly
acknowledges.
3. Xxxxxxx further agrees that UIT may credit against his salary under the
Employment Agreement any amounts he actually receives from Genisys Reservation
Systems, Inc. and its affiliates, including its wholly-owned subsidiary,
Netcruise Interactive, Inc. ("NII"), pursuant to that certain Agreement dated as
of July 23, 1998, for consulting services rendered by Xxxxxxx to NII from and
after January 1, 1999.
IN WITNESS WHEREOF, the parties hereto have signed this Agreement as of the
date first above written.
UNITED LEISURE CORPORATION UNITED INTERNET TECHNOLOGIES, INC.
By /s/ Xxxxx Xxxxxxx By /s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx Xxxxx Xxxxxxx
Title: Chief Executive Officer Title: Chief Executive Officer
By /s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx
