EXHIBIT 10.11
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement"), made and entered into this
20th day of December, 1999, by and between Uproar Inc. (the "Company"), and
Xxxxxxx X. Xxxxx (the "Executive").
WITNESSETH
WHEREAS, the Company has a need for the Executive's personal services
in a senior executive capacity; and
WHEREAS, the Executive possesses the necessary strategic, financial,
planning, operational and managerial skills necessary to fulfill those needs;
and
WHEREAS, the Executive and the Company desire to enter into a formal
Employment Agreement to fully recognize the contributions of Executive to the
Company and to assure continuous harmonious performance of the affairs of the
Company.
NOW, THEREFORE, in consideration of the mutual promises, terms,
provisions, and conditions contained herein, the parties agree as follows:
1. Position.
The Company hereby agrees to continue to employ the Executive to serve
in the role of Chief Financial Officer of the Company or such other senior
executive role as shall be agreed upon by the Executive and the Chairman and
Chief Executive Officer of the Company ("CEO"), subject to the limitations set
forth herein and agrees to perform the duties generally associated with his
position from time to time. The Executive accepts such employment upon the terms
and conditions set forth herein. The Executive shall, at all times during the
Term, report directly to the CEO. The Executive shall perform his duties
diligently and faithfully.
2. Term of Employment and Renewal.
The term of the Executive's employment under this Agreement (the
"Term") shall commence on the date of this Agreement (the "Effective Date") and
shall end on the earliest of (i) twenty-four (24) months after the Effective
Date; (ii) the date upon which the Agreement between the Company and Xxxxxxx
Television, Inc. dated January 12, 1999 (the "Pearson Agreement") is amended or
otherwise modified so that the cessation of the Executive's employment with the
Company or any affiliate no longer triggers the right of Xxxxxxx Television,
Inc. to terminate the Pearson Agreement; or (iii) the date of termination of the
Pearson Agreement.
1
3. Compensation and Benefits.
(a) Salary. Commencing on the Effective Date, the Company agrees to pay
the Executive a base salary at an annual rate of no less than One Hundred Fifty
Thousand Dollars ($150,000), payable in such installments as is the policy of
the Company (the "Salary"), but no less frequently than monthly. The Company
shall periodically consider appropriate increases to Executive's Salary but in
no event shall diminish the amount of Executive's Salary below the initial rate.
(b) Bonus. The Executive shall be eligible to receive annual bonuses,
up to a maximum of One Hundred Percent (100%) of the annual Salary, at the
discretion of the Company according to performance goals to be agreed upon by
the CEO and the Executive.
(c) Benefits. The Executive shall be entitled to participate in all
employee benefit plans which the Company provides or may establish from time to
time for the benefit of its employees, including, without limitation, group
life, medical, surgical, dental and other health insurance, short and long-term
disability, deferred compensation, profit-sharing and similar plans. The
Executive shall also be entitled to paid vacation of five (5) weeks per year.
(d) Stock Options. As of the last day of each calendar quarter during
the Term, beginning on March 31, 2000, the Company shall grant the Executive,
pursuant to the Company's 1999 Stock Option/Stock Issuance Plan (or any
successor plan), options to purchase fifteen thousand (15,000) shares of the
Company's common stock (the "Stock Options"), for a purchase price equal to the
fair market value of the shares at the time of the stock option grant, under the
terms and conditions set forth in the Company's standard Notice Of Grant of
Stock Options, and the exhibits thereto (other than the standard terms and
conditions relating to vesting), which shall be provided to the Executive upon
the date of the stock option grants provided for herein. The Stock Options shall
vest in full and become exercisable at the end of the Term, unless the Executive
is terminated for "Cause" or resigns without "Good Reason," as those terms are
defined below, in which case the Executive shall irrevocably forfeit all rights
to the Stock Options.
(e) Expenses. The Company shall pay or reimburse the Executive for all
reasonable out-of-pocket expenses actually incurred by him during the Term in
performing services hereunder, including business class airfare for travel to
and from Budapest, Hungary, provided that the Executive properly accounts for
such expenses in accordance with the Company's policies.
4. Termination and Severance.
Notwithstanding the provisions of Section 2 of this Agreement, the
Executive's employment hereunder may terminate under the following
circumstances:
2
(a) Termination by the Company for Cause. The Company may terminate the
Executive's employment hereunder for Cause at any time, upon written notice to
the Executive setting forth in reasonable detail the nature of such Cause. For
purposes of this Agreement, Cause is defined as (i) the Executive's willful and
material breach of the terms of this Agreement; (ii) the Executive's conviction
of any felony or any crime involving moral turpitude; (iii) willful misconduct
by the Executive in connection with the performance of his duties hereunder; or
(iv) the Executive's willful refusal to perform such duties, after thirty (30)
days' written notice and opportunity to cure. Upon the termination for Cause of
Executive's employment, the Company shall have no further obligation or
liability to the Executive other than for salary earned under this Agreement to
the date of termination, and any accrued but unused vacation.
(b) Termination by the Company Without Cause. The Executive's
employment hereunder may be terminated without Cause by the Company upon written
notice to the Executive, provided, however, that if the Company terminates the
Executive's employment without Cause, or the Executive terminates his employment
for Good Reason, as defined below, the Stock Options shall accelerate and vest
in full.
(c) Termination by the Executive. The Executive may terminate his
employment hereunder for "Good Reason," within thirty (30) days of the
occurrence of any of the following events (i) a material breach of this
Agreement by the Company; (ii) a material change in the Executive's duties or
responsibilities; (iii) a change in the Executive's reporting relationship so
that he no longer reports directly to the CEO; (iv) an involuntary relocation of
the Executive's worksite to a location 75 miles or more from its current
location; or (v) "Change of Control," as defined below. The Executive shall give
the Company twenty (20) days' written notice and opportunity to cure prior to
any termination for Good Reason based on the grounds specified in (i) through
(iv) above. As used herein, a "Change of Control" shall be deemed to occur if:
(i) there shall be consummated (x) any consolidation or merger of the Company in
which the Company is not the continuing or surviving corporation or pursuant to
which the stock of the Company would be converted into cash, securities or other
property, other than a merger or consolidation of the Company in which the
holders of the Company's stock immediately prior to the merger or consolidation
hold more than fifty percent (50%) of the stock or other forms of equity of the
surviving corporation immediately after the merger, or (y) any sale, lease,
exchange or other transfer (in one transaction or a series of related
transactions) of all, or substantially all, the assets of the Company, or (ii)
the Board of Directors of the Company approves any plan or proposal for
liquidation or dissolution of the Company.
(d) Death. In the event of the Executive's death during the Term of
this Agreement, the Executive's employment hereunder shall immediately and
automatically terminate, and the Company shall have no further obligation or
duty to the Executive or his estate or beneficiaries except that the Stock
Options shall accelerate and vest in full and the Company shall pay the
Executive's estate the Salary and vacation earned under this Agreement prior to
the date of termination and any payments or benefits due under Company policies
or benefit plans.
3
(e) Disability. The Company may terminate the Executive's employment
hereunder, upon written notice to the Executive, in the event that the Executive
becomes disabled during the Term through any condition of either a physical or
psychological nature and, as a result, is, with or without reasonable
accommodation, unable to perform the essential functions of the services
contemplated hereunder for (a) a period of ninety (90) consecutive days, or (b)
for shorter periods aggregating one hundred twenty (120) days during any twelve
(12) month period during the Term. Any such termination shall become effective
upon mailing or hand delivery of notice that the Company has elected to exercise
its right to terminate under this subsection 4(e), and the Company shall have no
further obligation or duty to the Executive except that the Stock Options shall
accelerate and vest in full and the Company shall pay the Executive the Salary
and vacation earned under this Agreement prior to the date of termination and
any payments or benefits due under Company policies or benefit plans.
5. Choice of Law.
The validity, interpretation and performance of this Agreement shall be
governed by, and construed in accordance with, the internal law of New York,
without giving effect to conflict of law principles.
6. Miscellaneous.
(a) Assignment. The Executive acknowledges and agrees that the rights
and obligations of the Company under this Agreement may be assigned by the
Company to any successors in interest. The Executive further acknowledges and
agrees that this Agreement is personal to the Executive and that the Executive
may not assign any rights or obligations hereunder.
(b) Entire Agreement. Unless otherwise specifically provided for
herein, this Agreement sets forth the entire agreement between the parties and
supersedes any prior communications, agreements and understandings, written or
oral, with respect to the terms and conditions of the Executive's employment.
(c) Amendments. Any attempted modification of this Agreement will not
be effective unless signed by an officer of the Company and the Executive.
(d) Headings. The parties acknowledge that the headings in this
Agreement are for convenience of reference only and shall not control or affect
the meaning or construction of this Agreement.
4
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement
as of the day and year set forth below.
XXXXXXX X. XXXXX UPROAR INC.
/s/ Xxxxxxx X. Xxxxx By: /s/ Xxxxxxx X. Xxxx
------------------------------ ---------------------------------
Title: Chief Executive Officer
---------------------------------
Dated: December 20, 1999 Dated: December 20, 1999
5
