EXHIBIT 10.3
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated April 24, 1999, (the "Effective Date"), by
and between Pacific WebWorks, Inc., (the "Company) and Xxxxxxxxx Xxxxxx
("Executive"). The Company desires to engage the services of the Executive as
President of the Company on the terms and subject to the conditions of this
Agreement, and Executive desires to accept such employment.
In consideration of the terms and mutual covenants contained in this
Agreement, the Company and Executive agree as follows:
1. Employment. The company hereby engages the services of Executive as
President of the Company with powers and duties consistent with such position,
and Executive hereby accepts such engagement. During the terms of this
Agreement, Executive shall perform such additional duties and accept election or
appointment to such additional offices or positions of the Company or its
affiliates of an executive nature as may be specified by the Board of Directors
of the Company. Executive shall perform his obligations to the Company and its
subsidiaries pursuant to this Agreement under the direction of the Board of
Directors of the Company and/or the President, and Executive shall devote
approximately all of his business time and efforts to such performance.
2. Term. This Agreement shall continue in full force and effect for a
term of one year beginning on the Effective Date, unless sooner terminated
pursuant to the provisions contained herein (the "Initial Term"). Unless
terminated, this Agreement will be renewed automatically for one or more
successive one-year terms (the "Renewal Terms"), unless Executive or the Company
gives its written notice of non-renewal to the other party not less than ninety
(90) days prior to the expiration of the then-current term. Executive's period
of employment hereunder, including the Initial Terms and all Renewal Terms,
shall constitute and be hereinafter referred to as the "Term" of this Agreement.
3. Compensation. For services rendered pursuant to this Agreement,
Executive shall receive, commencing on the Effective Date, the following
compensation: (i) a base salary of Sixty Thousand Dollars ($60,000.00) per year;
and (ii) such bonuses and/or increases as from time to time as referenced herein
or as authorized by the Board of Directors in their sole discretion, but not
exceeding One Hundred Twenty Five Thousand Dollars ($125,000.00) in combined
annual salary and bonus. Executive's base salary shall be paid in equal
bi-monthly installments.
4. Incentive Bonus. In addition to the base salary, Executive shall be
eligible for an incentive bonus ("Incentive Bonus") each year in the amount as
identified herein. The Incentive Bonus shall be based upon the operating results
for that year of the Company and shall be issued, if earned, within thirty days
after such operating results have been determined by the company's accountants.
The operating results shall be measured by company profits and shall be
distributed on a per quarter basis to Executive. The criteria upon which the
Incentive Bonus is awarded shall be set by the Board of Directors.
5. Employment Benefits. Executive shall be entitled to two weeks of
paid vacation each calendar year, beginning January 1, 1999. Unused vacation
time shall not accrue or carry over to future years, so that two weeks will be
the maximum amount of paid vacation to which Executive shall be entitled
hereunder during any calendar year. In addition, Executive shall be entitled to
nine paid holidays, and six paid sick days.
During the term of this Agreement, the Company will provide to
Executive the following:
(a) Medical and short and long-term disability insurance
programs for the benefit of Executive;
(b) Executive shall have the ability to purchase Medical
Benefits at the cost of the company for any immediate family members.
6. Reimbursement of Future Expenses. Executive shall be reimbursed by
the Company for all reasonable out-of-pocket expenses documented and incurred by
Executive in performance of his duties under this Agreement.
7. Termination. Executive's employment will terminate upon the first to
occur of the following:
(a) Termination of the Company for "cause," as reasonably
determined by the Company's board of directors in good faith. For the purpose of
this section 7, "cause" shall mean:
(i) misfeasance or negligence in the performance of his
duties hereunder;
(ii) engagement by Executive in dishonest or illegal
conduct that is injurious to the Company; or
(iii) a breach of the Company's policy and procedure as
reasonably established from time to time by the Board of Directors of
the company that is not cured within 30 days of notice being sent by
the Company.
Executive shall be given 30 days notice of any anticipated termination
of his employment for cause, and a 30 days opportunity to rectify or correct the
alleged problem.
(b) Termination by the company (in its sole discretion) in the
event of Executive's disability. "Disability" will be deemed to exist if
Executive has substantially failed to perform his duties hereunder for 90
consecutive days for reasons of mental or physical health and is no longer able
to perform his duties hereunder with or without reasonable accommodations by the
Company, or if a physician selected in good faith by the Company examines
Executive (and Executive agrees to permit such examinations at the Company's
expense) and advises the Company that Executive will not be able to perform his
duties hereunder with or without reasonable accommodations by the Company for
the following 90 consecutive days. In determining what are reasonable
accommodations, the Company shall comply with the American Disability Act. If
the Company terminated Executive's employment for disability, Executive shall
receive compensation due under section 3 of this agreement and the employee
benefits due under section 4 of this Agreement through the date of termination
and the Company will have no further obligation under this Agreement other than
the continuation of insurance policies to the extent required by law upon
termination. At the sole discretion of the Board of Directors, the employee
stock option may be extended, for the period of time to be determined by the
Board, following the Disability.
(c) Executive's death. In the event of the Executive's death,
Executive's estate or surviving spouse, as applicable, shall receive all
compensation due to Executive under this Agreement through the date of death and
the Company will have no further obligation under this agreement other than the
continuance of insurance policies to the extent required by law and continuation
of other benefits under this Agreement for six months following the date of
death. At the sole discretion of the Board of Directors, the employee stock
option plan may be extended, for a period of time to be determined by the Board,
following the Death.
8. Notice of Termination. Any Termination of Executive's employment
under this Agreement shall be communicated by a written Notice of Termination to
the other party hereto, which notice shall specify the particular termination
provision in this Agreement relied upon by the Terminating party and shall set
forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination under such provision.
9. Executive's Devotion of Time. Executive hereby agrees to devote his
full time, abilities and energy to the faithful performance of the duties
assigned to him or her and to the promotion and forwarding of the business
affairs of the Company, and not to divert any business opportunities from the
Company to himself or to any other person or business entity without approval of
the Board of Directors.
10. Agreement Not to Compete. In the event that this Agreement expires
in accordance with its terms of is terminated for any reason, Executive
covenants and agrees that for a period of one year after his employment under
this Agreement expires or is so terminated, he will not directly or indirectly
whether as employee, director, owner, 5% or greater stockholder, consultant,
partner (limited or general) or otherwise engage in or have any interest in any
business that competes with the business of the Company or its subsidiaries
provided, except as approved by the Board of Directors on a case by case basis.
The Company may, in its discretion, give Executive written approval(s) to
personally engage in any activity or render any services referred to in this
Section if Company secures written assurances (satisfactory to the Company and
its counsel) from the Executive and any prospective employer(s) of Executive
that the integrity of the Company's Confidential or Proprietary Information will
not in any way be jeopardized by such activities, provided that the burden or so
establishing the foregoing to the satisfaction of the Company and its counsel
shall be upon the executive and prospective employer(s).
11. Agreement not to Solicit Employees, Customers, or Others. Executive
covenants and agrees that, for a period of two years after this Agreement is
terminated, he will not, directly or indirectly, (i) solicit, induce or hire
away, or assist any third party in soliciting, diverting or hiring away, any
employee of the Company or its subsidiaries, whether or not the employee's
employment is for a specified term or is at will, or (ii) induce or attempt to
induce any customer, supplier, dealer, lender, licensee, consultant, or other
business relation of the Company or its subsidiaries to cease doing business
with the Company or its subsidiaries.
12. Inventions and Improvements. Executive agrees that all inventions,
innovations, or improvements in the Company's or its subsidiaries' products or
methods of conducting its business (including new combinations, applications,
improvements, ideas, and discoveries, whether or not copyrightable or
patentable) conceived or made by him while he is employed by the Company or its
subsidiaries is and will remain the property of the Company. Executive will
promptly disclose such inventions, innovations, or improvements to the Board of
Directors of the Company and perform all actions reasonably requested to
establish or confirm the ownership of the Company or its subsidiaries thereof.
13. Ownership, Non-Disclosure and Non-Use of Confidential or
Proprietary Information.
(a) Executive covenants and agrees that while he is employed
by the Company and after termination of employment he will not, directly or
indirectly:
(i) give any person not authorized by Company to receive
it or use it, except for the sole benefit of the company or its
subsidiaries, any of the Company's or subsidiaries' proprietary date of
information whether relating to management, know-how, patents or
otherwise; or
(ii) give to any person not authorized by the Company to
receive in any specifications, reports or technical information or the
like owned by the Company or its subsidiaries; or
(iii) give to any person not authorized by the Company to
receive it any information that is not generally known outside the
Company or that is designated by the Company or its subsidiaries as
limited, private, or confidential.
(b) If Executive is employed in a sales capacity, Executive
will not render services, directly or indirectly, to any competitor of the
Company or its subsidiaries.
(c) Executive covenants and agrees that he will keep himself
informed of the Company's policies and procedures for safeguarding the Company
property including proprietary data and information and will strictly comply
therewith at all times. Executive will return to the Company or its subsidiaries
immediately upon termination of his employment all Company or its subsidiaries
property in his possession or control.
14. Limitations. The parties agree that in the event any court of
competent jurisdiction should determine that the term or restrictions set forth
herein is unreasonable in scope, then in such event the court shall fix the term
or restrictions so as to be reasonable, enforceable and consistent with the
intent of this Agreement.
15. Independent Agreements: Survival. Executive and Company agree that
the covenants made in Sections 7 through and including 12 herein shall be
construed as agreements independent of any other provision of the Agreement, and
shall survive the termination of the Agreement. Moreover, the existence of any
claim or cause of action of Executive against the Company, or the Company
against Executive, whether or not predicated upon the terms of this Agreement,
shall not constitute a defense to the enforcement of any of these covenants
against Executive by Company, or against Company by Executive, respectively. Any
reference to the Company in Sections 6 through and including 11 shall include
the Company and its subsidiaries where applicable.
16. Complete Agreement. This Agreement embodies the complete Agreement
and understanding between the parties and supersedes any prior understandings,
agreements, or representations by or among the parties, whether written or oral,
concerning the subject matter hereof in any way.
17. Amendments: Waivers. This Agreement may not be amended except by a
writing signed by both an appropriate member of the Company's management or
Board of Directors and Executive. Any waiver by a party hereof of any right
hereunder shall be effective only if evidenced by a signed writing, and only to
the extent set forth in such writing.
18. Successor and Assigns. This Agreement shall be binding upon and
inure to the benefit of and be enforceable by the parties hereto and their
respective successors, heirs, and assigns, except that Executive may not assign
any of his obligations hereunder without the prior written consent of the
Company.
19. Remedies. Each of the parties to this Agreement will be entitled to
specifically enforce its rights under this Agreement, to recover damages by
reason of any breach of any provisions of this Agreement and to exercise all
other rights to which it may be entitled. The parties agree and acknowledge that
money damages may not be an adequate remedy for breach of provision of the
Agreement and accordingly, each party hereby agrees and consents that in the
event of any material breach of this Agreement by it, the non-breaching party
may obtain appropriate injunctive relief or an order for specific performance,
in order to enforce or prevent any violations of the provisions of this
Agreement.
20. Governing Law. In the event of any disputes arising under this
Agreement, it is agreed between the parties that the laws of the State of Utah
will govern the interpretation, validity, and effect of this Agreement without
regard to the place of execution or performance hereof.
21. Dispute Resolution. In the event of any dispute between the parties
arising out of or related to this Agreement, the parties agree to use the
following procedure prior to either party pursuing other available remedies:
(a) A meeting shall be held promptly between the parties,
attended by representatives having decision-making authority regarding the
disputes, to attempt in good faith to negotiate a resolution of the dispute.
(b) If, within thirty (30) days after such meeting, the
parties will have not succeeded in negotiating a resolution of the disputes,
they will jointly appoint mutually acceptable neutral person not affiliated with
either of the parties (the "Neutral"), seeking in such regard from the American
Arbitration Association, Center for Public Resources, or other mutually
agreed-upon organization if they have been unable to agree upon such appointment
within forth (40 ) days from the initial meeting. The fees of, and authorized
costs incurred by, the Neutral shall be shared equally by the parties.
(c) In consultation with the Neutral, the parties will select
or devise an Alternative Disputes Resolution procedure ("ADR") by which they
will attempt to resolve the dispute, and a time and place for the ADR to be
held, with the Neutral making the decision as to the procedure and/or place and
time, if the parties have been unable to agree on any of such matters within
twenty (20) days after initial consultation with the Neutral. In any case, the
ADR shall be held no later than sixty (60) days after selection of the Neutral.
(d) The parties agree to participate in good faith in the ADR
to its conclusion. If the parties are not successful in resolving the dispute
through the ADR, then either party may pursue other available remedies upon
seven (7) days written notice to the other party specifying its intended course
of action.
22. Notices. Any notice to be given hereunder shall be in writing and
shall be effective when personally delivered or sent to the other party by
registered or certified mail, return receipt requested, or overnight courier,
postage prepaid, or otherwise when received by the other party, at the address
set forth at the end of this Agreement.
23. Severability. Any provision of this agreement that is deemed
invalid, illegal, or unenforceable in any jurisdiction shall, as to that
jurisdiction and subject to this section, be ineffective to the extent of such
invalidity, illegality, or unenforceability, without affecting in any way the
remaining provisions hereof in such jurisdiction or rendering that or any other
provisions of this Agreement invalid, illegal, or unenforceable in any other
jurisdiction. If the covenant should be deemed invalid, illegal, or
unenforceable because its scope of the covenant is reduced only to the minimum
extent necessary to render the modified covenant valid, legal and enforceable.
24. Attorney Fees. In the event any action or proceeding is brought by
any party, against any other party, to enforce the provisions of this Agreement,
the prevailing party shall be entitled to recover its costs and reasonable
attorney fees, whether such sums are expended with or without suit, at trial or
on appeal.
25. Taxes. All applicable state and federal employment taxes shall be
withheld by the Company and paid directly to the taxing agency. Payroll checks
and other disbursements to Executive shall be net after taxes.
26. Construction. This Agreement shall not be construed against the
party preparing it, and shall be construed without regard to the identity of the
person who drafted it or the party who caused it to be drafted and shall be
construed as if all parties had jointly prepared this Agreement and it shall be
deemed their joint work product, and each and every provision of this Agreement
shall be construed as though all the parties hereto participated equally in the
drafting hereof; and any uncertainty or ambiguity shall not be interpreted
against any one party. As a result of the foregoing, any rule of construction
that a document is to be construed against the drafting party shall not be
applicable.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
this 24th day of April, 1999.
Pacific WebWorks, Inc. EXECUTIVE
By: /S/ /S/
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Name: Xxxxx Xxxxxx Xxxxxxxxx Xxxxxx, President
