EXECUTIVE EMPLOYMENT AGREEMENT OXFORD MEDIA, INC., a Nevada corporation, as “Employer” and J. RICHARD SHAFER, as “Executive”
EXECUTIVE
EMPLOYMENT
AGREEMENT
a
Nevada corporation,
as
“Employer”
and
J.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
as
“Executive”
Effective
Date:
20
MARCH 2006
I
PARTIES
THIS
EXECUTIVE EMPLOYMENT AGREEMENT
(the
“Agreement”) is entered into effective as of the 20th
day of
March, 2006 (the “Effective Date”), by and between OXFORD
MEDIA, INC., a Nevada corporation
(the
“Employer”); and,
J.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, an individual currently residing in the State of California
(the
“Executive”). Employer and Executive are sometimes referred to collectively
herein as the “Parties”, and each individually as a “Party”.
II
RECITALS
A. Employer
is engaged in the business of, among other things, among other things,
acting
as
a wireless and business systems provider specializing in WiFi/WiMAX, IT Security
and IT Integration, and Telecom (which includes as part of these offering
of
services, the design and installation of specialty communication systems
for
data, voice, video, and telecom, and the deployment of fixed wireless networks),
in addition to providing support to affiliated entities of Employer
in developing
private broadband networks and proprietary software and hardware which allows
for the delivery of low-cost broadband Internet access as well as video and
audio content on demand on a Pay-Per-View basis.
B. Employer’s
principal place of business is located at ▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ (the
“Premises”).
C. Executive
is
acknowledged as having domain expertise and significant contacts in the fields
of technology to be pursued by Employer, and Executive represents
to possess certain other skills and contacts which would enable Executive
to
benefit Employer.
D. The
Parties acknowledge that the Executive’s abilities and services are unique and
essential to the prospects of Employer, and Employer has relied upon Executive
agreeing to serve Employer pursuant to this Agreement.
E. Employer
desires to retain the services of Executive, and Executive desires to be
retained by Employer, all pursuant to the terms and conditions contained
herein.
F. NOW,
THEREFORE,
in
consideration of the promises and the mutual covenants contained herein,
and for
other good and valuable consideration, the receipt and sufficiency of which
are
hereby acknowledged, the Parties, intending to be legally bound, hereby agree
as
follows:
1
III
EMPLOYMENT
3.1
Position.
Employer hereby hires Executive to serve in the position as executive vice
president of sales. Executive shall do and perform all services, duties,
responsibilities, and acts typically and customarily undertaken by the executive
vice president of sales of a corporation of size and scope substantially
similar
to Employer, which shall include but not be limited to those items prescribed
by
the Bylaws of Employer, as amended from time-to-time, subject always to the
final determination of the Board of Directors of Employer (the “Board”). Said
services may also include, but not be limited to, those listed on Exhibit
3.1,
attached hereto and incorporated herein by reference.
3.2
Reasonable
Additional or Changed Responsibilities.
Nothing
herein shall preclude the Board from changing Executive’s title or materially
changing the duties of Executive if such Board has concluded in its reasonable
judgment that such change is in Employer’s best interests. At all times during
the term of this Agreement, Executive shall be employed as a senior executive
of
Employer, with appropriate and commensurate compensation, title, rank and,
status. If Executive is elected or appointed a director or officer of any
of
Employer’s subsidiaries during the Term of this Agreement, Executive, if he
accepts such position, will serve in such capacity without further
compensation.
3.3
Time
and Effort.
3.3.1.
Entire
Productive Time.
Executive shall devote Executive’s entire business time, attention, knowledge,
and skill to the business and interests of Employer. Employer shall be entitled
to all the benefits and profits arising from or incident to any and all services
performed by Executive pursuant to this Agreement.
3.3.2.
Exceptions.
Nothing
contained in Section 3.3.1., above, shall be construed to prevent Executive
from, during the Term of this Agreement:
(a) purchasing
securities in any corporation whose securities are regularly traded provided
that such purchase shall not result in his collectively owning beneficially
at
any time five percent (5%) or more of the equity securities of any corporation
engaged in a business competitive to that of Employer;
(b) participating
in conferences, preparing or publishing papers or books or teaching, so long
as
Executive provides reasonable written notice to the Board of such activities
prior to Executive engaging in them; or
(c) Continuing
to participate in business activities and pursuits in which Executive is
involved as of the Start Date.
2
3.4 Term.
3.4.1.
Initial
Term.
Executive’s employment with Employer and the Term of this Agreement shall
commence on the 20th
day of
March, 2005 (the “Start Date”), and shall continue for an initial period of
three (3) years, unless sooner terminated as provided for herein (the “Initial
Term”).
3.4.2.
Extended
Term.
This
Agreement shall remain in full force and effect and shall renew for an
additional twenty-four (24) months (the “Extended Term”), provided that neither
Party at least sixty days (60) prior to the end of Initial Term gives written
notice to the other of its decision to not have the Agreement remain in full
force and effect for the Extended Term, thereby terminating the Agreement
as of
and at the end of the Initial Term.
3.4.3.
Term
Defined.
For
purposes of this Agreement, the word “Term” shall specifically include the
Initial Term and all Extended Term hereunder.
3.5
Location.
Except
for routine travel incident to the business of Employer, Executive’s services
hereunder shall be principally performed at the Premises, or such other location
within the surrounding area of the Premises.
IV
COMPENSATION
4.1
Base
Salary.
Employer agrees to pay Executive and Executive agrees to accept as compensation
for the services and obligations set forth herein, as Base Salary, the sums
referenced on Exhibit 4.1, attached hereto and incorporated herein by reference,
per annum, which sum shall be paid to Executive by Employer in equal
semi-monthly installments to be tendered to Executive on the first and fifteenth
day of each month, or at such other intervals as may be mutually agreed upon
by
Employer and Executive.
4.1.1.
Necessary
Deductions.
Employer shall deduct from the Base Salary amounts sufficient to cover
applicable federal, state, and/or local income tax withholdings, and any
other
amounts which Employer is required to withhold by applicable law.
4.1.2.
Yearly
Review.
Upon
each yearly anniversary of the Start Date, Executive’s Base Salary shall be
reviewed by the Board or the Compensation Committee of the Board (the
“Compensation Committee”). Base Salary may be increased above those amounts
referenced in Exhibit 4.1, but may never be decreased, in the sole discretion
of
the Board or the Compensation Committee.
4.2
Discretionary
Annual Bonuses.
Employer may, but is not obligated to, pay Executive, as additional annual
compensation, during each calendar year ending during the Term of this
Agreement, such sums as may annually be determined by the Board, or the
Compensation Committee, including bonus, regular and cost of living increases,
and adjustments.
3
V
EXECUTIVE
BENEFITS
5.1
Employer
Policy.
During
the Term of this Agreement, Executive
shall be entitled to participate in employee benefit plans or programs of
Employer, if any, to the extent that his position, tenure, salary, age, health
and other qualifications make him eligible to participate, subject to the
rules
and regulations applicable thereto. Such additional benefits shall include,
subject to the approval of the Board, full medical, dental and disability
income
insurance, and participation in qualified pension and profit sharing plans,
as
well as a car allowance of Seven Hundred Fifty Dollars ($750.00) per month
and a
One Hundred Fifty Dollar ($150.00) monthly cell phone allowance.
5.2
Business
Expenses.
Employer will reimburse Executive for all reasonable business expenses incurred
by Executive in the performance of Executive’s duties provided
that:
(a)
Each
such
expenditure is reasonable and is made to support the execution of Employer’s
business or strategic plan;
(b)
Executive
furnishes to Employer adequate records and other documentary evidence required
to substantiate such expenditures as a proper deduction for federal income
tax
purposes.
5.3
Vacation
Time.
Executive shall be granted three (3) weeks paid vacation for each calendar
year
during the Term, with said time being immediately available for Executive’s
benefit. Vacation shall only be taken at such times as not to interfere with
the
necessary performance of Executive’s duties and obligations under this Agreement
unless otherwise agreed upon by the Board. However, if at the end of any
calendar year there is any accrued and unused vacation time for Executive,
additional vacation time for Executive will not accrue until Executive takes
all
of his vacation time accrued from prior calendar years. Upon using said accrued
vacation time, Executive shall once again be entitled to three (3) weeks
paid
vacation time for that calendar year, prorated for the month in which the
remaining accrued vacation time was taken.
5.4
Indemnification.
Employer and Executive
shall execute an Indemnification Agreement in the form of Exhibit 5.4, attached
hereto and incorporated herein by reference, which shall provide, among other
things, that Employer shall indemnify Executive against certain claims arising
by reason of the fact that he is or was an officer or director of Employer.
In
addition to all rights under the Indemnification Agreement, the Parties further
agree that all liabilities incurred by Executive in his capacity as an officer
hereunder shall be incurred for the account of Employer, and Executive shall
not
be personally liable therefore. Executive shall not be liable to Employer,
or
any of its respective subsidiaries, affiliates, employees, officers, directors,
agents, representatives, successors, assigns, stockholders, and their respective
subsidiaries and affiliates, and Employer shall, and hereby agrees to,
indemnify, defend and hold Executive harmless from and against any and all
damages and/or loss or liability (including, without limitation, all cost
of
defense thereof), for any acts or omissions in the performance of service
under
and within the scope of this Agreement on the part of Executive.
4
5.5
Change
in Control Payments.
5.5.1.
Change
in Control.
For
purposes of this Agreement, a “Change in Control” of Employer shall be deemed to
have occurred if (a) there shall be consummated (i) any consolidation or
merger
of Employer into or with another person, as such term in used in Sections
13(d)(3) and 14(d)(2) of the Securities and Exchange Act of 1934, as amended
(the “Exchange Act”), in which Employer is not the continuing or surviving
corporation or pursuant to which shares of Employer’s common stock immediately
prior to the merger have the same proportionate ownership of common stock
of the
surviving corporation immediately after the merger, or (ii) any sale, lease
or
other transfer (in one transaction or a series of related transactions) of
all
or substantially all of the assets of Employer; or, (b) the shareholders
of
Employer approve any plan or proposal for the liquidation or dissolution
of
Employer; or, (c) any person who is not now the owner of twenty percent (20%)
or
more of Employer’s outstanding equity securities shall become the beneficial
owner (within the meaning of Rule 13d-3 under the Exchange Act) of twenty
percent (20%) or more of Employer’s outstanding equity securities; or, (d)
individuals who are the members of the Board (once the Board consists of
at
least seven members) cease to constitute a majority of the members of the
Board,
provided that any person becoming a member of the Board subsequent to such
date
whose election or nomination for election was supported by two-thirds of
the
directors who then comprised the Board shall be considered to be part of
the
original majority.
5.5.2.
Severance
Payment.
Upon
the occurrence of a Change in Control of Employer, the employment of Executive
hereunder shall terminate and Employer shall pay (or, if applicable, Employer
shall ensure that it’s successor or assign shall pay) to Executive in cash, on
the day on which the Change of Control occurs (which for the purposes of
this
Agreement, shall be the Termination Date for this Article V), the
following:
(a)
All
accrued and unpaid salary and other compensation payable to Executive by
Employer for services rendered by Executive to Employer through the Termination
Date;
(b)
All
accrued and unused vacation and sick pay payable to Executive by Employer
with
respect to services rendered by Executive to Employer through the Termination
Date; and
(c)
Severance
pay in an amount equal to twenty-four (24) months salary based upon the then
existing salary of Executive, with the total amount to be paid in one
installment on the due date noted above, calculated at a net present
value.
5.5.3.
Provision
of Services Following Change in Control.
At the
request of Employer, Executive shall continue to serve hereunder for a period
of
time not to exceed one hundred eighty (180) days following the Termination
Date.
If Employer requests Executive to perform such services, Executive shall
be
compensated from and after the Termination Date for the period that Executive
actually remains employed by Employer at his then current salary, and with
the
provisions of Section 5.2, above, continuing to apply as well. All such amounts
payable to Executive shall be in addition to and not in lieu of the amounts
payable to Executive under Section 5.5.2, above. Upon the later to occur
of an
occurrence of a Change of Control or the termination of any period during
which
Executive continues to provide services as aforesaid, Executive’s employment
hereunder shall terminate.
5
5.6
Life
Insurance.
Upon
the completion of the first six (6) months under the Term, Employer shall
purchase, at its sole cost and expense, a term life insurance policy with
a
death benefit of One Million Dollars ($1,000,000), with Executive as the
owner
and insured, if such coverage is available. Executive, as the owner of the
policy, shall designate the beneficiary of the policy, as he may change same
from time-to-time. Employer shall keep and maintain the policy in full force
and
effect throughout the entire Term. Executive agrees to permit Employer to
purchase “key man” term life insurance coverage (as that term is commonly
defined) on Executive for the benefit of Employer, in the sole discretion
and
sole cost and expense of Employer.
5.7
Board
Participation.
Executive shall serve as an ex-officio/invitee of the Board of Directors
of
Oxford Media, Inc. (“Oxford’s Board”), the corporate parent of Employer.
Executive shall have full
right of participation in all meetings of Oxford’s Board. Executive shall have
no voting rights. Oxford’s Board reserves the right to excuse Executive from any
meeting in the event Oxford’s Board reasonably determines that confidentiality
dictates that Executive not participate in any such meeting, or portion
thereof.
VI
TERMINATION
6.1
Termination
in Case of Death.
6.1.1.
Termination
Event.
Executive’s employment hereunder shall terminate immediately upon the death of
Executive, which shall be the Termination Date for this Section
6.1.
6.1.2.
Result
of Termination.
Upon
termination of Executive’s employment pursuant to this Section 6.1, Employer
shall pay to Executive’s estate, on the Termination Date, a lump sum payment of
an amount equal to (i) all accrued and unused vacation and sick pay payable
to
Executive by Employer with respect to serviced rendered by Executive to Employer
through the Termination Date; and, (ii) if the Termination Date occurs during
the Extended Term, an amount equal to twelve (12) months salary based upon
the
then existing salary of Executive, payable in the same manner as salary would
have been paid to Executive had he continued to work for Employer hereunder.
In
addition to the foregoing, and notwithstanding the provisions of any other
agreement to the contrary, Employer shall continue to provide for the benefit
of
Executive’s family the medical benefits referred to in Section 5.1 hereof for
twelve (12) months following the Termination Date.
6.2
Termination
in Case of Disability.
6
6.2.1.
Termination
Event.
If
Executive suffers a physical or mental disability which results in Executive
being unable to perform his duties hereunder for a three (3) consecutive
month
period, then the Parties shall proceed as follows: (i) the Board shall select
a
qualified physician; (ii) Executive or his legal representative, if applicable,
shall select a qualified physician; (iii) those two (2) physicians shall
select
a third qualified physician; (iv) the three physicians shall examine Executive
and review his physical and mental capacity. If a majority of the three
physicians determine in good faith that such physical or mental disability
renders Executive incapable of performing his duties hereunder for a period
of
at least three (3) consecutive months following the date of such physician’s
written opinion, then Executive’s employment shall terminate effective three (3)
weeks following the date of such physician’s written opinion, which shall be the
Termination Date for this Section 6.2.
6.2.2.
Result
of Termination.
Upon
termination of Executive’s employment pursuant to this Section 6.2, Employer
shall pay to Executive, on the Termination Date, a lump sum payment of an
amount
equal to (i) all accrued and unpaid salary and other compensation payable
to
Executive by Employer and all accrued and unused vacation and sick pay payable
to Executive by Employer with respect to services rendered by Executive to
Employer through the Termination Date; and, (ii) if the Termination Date
occurs
during the Extended Term, an amount equal to nine (9) months salary based
upon
the then existing salary of Executive, payable in the same manner as salary
would have been paid to Executive had he continued to work for Employer
hereunder. However, such amount shall be reduced by the amount of any payments
to be paid to Executive under any long-term disability insurance policy
maintained by Employer for the benefit of Executive. In addition to the
foregoing, and notwithstanding the provisions of any other agreement to the
contrary, Employer shall continue to provide to Executive all other benefits
referred to in Section 5.1 hereof for nine (9) months following the Termination
Date.
6.3
Termination
By Executive for Cause.
6.3.1.
Termination
Event.
This
Agreement shall terminate upon ten (10) days prior written notice from Executive
to Employer of Executive’s decision to terminate “for cause” (as defined below),
provided that the notice specifies the conduct constituting “for cause”
hereunder, and Employer does not remediate or cease, as appropriate, the
conduct
constituting “for cause” prior to the expiration of such ten (10) day period.
For purposes of this Section 6.3, the term “for cause” shall include the
following:
(a)
The
willful breach of any of the material obligations of Employer owed to Executive
under this Agreement;
(b)
The
Employer’s primary chief executive offices are moved to a location outside of
Orange County, California, unless approved by the Board; or
(c)
The
material breach of this Agreement by Employer.
6.3.2.
Result
of Termination.
Upon
termination of Executive’s employment pursuant to this Section 6.3. Employer
shall pay to Executive, on the termination date designated by Executive,
an
amount equal to (i) all accrued and unpaid salary and other compensation
payable
to Executive by Employer and all accrued and unused vacation and sick pay
payable to Executive by Employer with respect to services rendered by Executive
to Employer through the Termination Date; and, (ii) an amount equal to twelve
(12) months salary based upon the then existing salary of Executive, payable
in
the same manner as salary would have been paid to Executive had he continued
to
work for Employer hereunder. In addition to the foregoing, and notwithstanding
the provisions of any other agreement to the contrary, Employer shall continue
to provide to Executive all other benefits that would otherwise be payable
to
Executive pursuant to Section 5.1 hereof for the twelve (12) months following
the Termination Date.
7
6.4
Termination
by Executive Without Cause.
6.4.1.
Termination
Event.
This
Agreement shall terminate immediately upon delivery to Employer of thirty
(30)
days written notice of termination by Executive without cause.
6.4.2.
Result
of Termination.
Upon
termination of this Agreement pursuant to this Section 6.4, Employer shall
pay
to Executive, on the Termination Date, a lump sum payment of an amount equal
to
all accrued and unpaid salary and other compensation payable to Executive
by
Employer and all accrued and unused vacation and sick pay payable to Executive
by Employer with respect to services rendered by Executive to Employer through
the Termination Date.
6.5
Termination
by Employer With Cause.
6.5.1.
Termination
Event.
This
Agreement shall terminate upon ten (10) days prior written notice from Employer
to Executive of the termination of Executive’s employment “for cause” (as
defined below), provided that the notice specifies the conduct constituting
“for
cause” hereunder, and Executive does not cease the conduct constituting “for
cause” prior to the expiration of such ten (10) day cure period. For purposes of
this Section 6.5, the term “for cause” shall include the following:
(a) Any
action by Executive resulting in the conviction or plea of nolo contendre
of any
criminal statute constituting a felony;
(b) Gross
misconduct in the performance of Executive’s duties hereunder;
(c) The
failure by Executive to follow or comply with the policies and procedures
of
Employer, or the written directives of the Board of Directors of Employer,
provided that such policies, procedures or directives are consistent with
Executive’s duties hereunder;
(d) The
violation by Executive of any material provision of this Agreement.
6.5.2.
Result
of Termination.
Upon
termination of this Agreement pursuant to this Section 6.5, Employer shall
pay
to Executive, on the Termination Date, a lump sum payment of an amount equal
to
all accrued and unpaid salary and other compensation payable to Executive
by
Employer and all accrued and unused vacation and sick pay payable to Executive
by Employer with respect to services rendered by Executive to Employer through
the Termination Date.
8
6.6
Termination
By Employer Without Cause.
6.6.1.
Termination
Event.
The
employment of Executive shall terminate immediately upon delivery to Executive
of written notice of termination by Employer, which shall be deemed to be
“without cause” unless termination is expressly stated to be pursuant to
Sections 6.1 or 6.2.
6.6.2.
Result
of Termination.
Upon
termination of this Agreement pursuant to this Section 6.6, Employer shall
pay
to Executive, on the Termination Date, an amount equal to (i) all accrued
and
unpaid salary and other compensation payable to Executive by Employer and
all
accrued and unused vacation and sick pay payable to Executive by Employer
with
respect to services rendered by Executive to Employer through the Termination
Date; and, (ii) an amount equal to twelve (12) months salary based upon the
then
existing salary of Executive, payable in the same manner as salary would
have
been paid to Executive had he continued to work for Employer hereunder. In
addition to the foregoing, and notwithstanding the provisions of any other
agreement to the contrary, Employer shall continue to provide to Executive
all
other benefits that would otherwise be payable to Executive pursuant to Section
5.1 hereof for the twelve (12) months following the Termination
Date.
6.7
Termination
upon the Expiration of the Term.
Upon
termination of this Agreement upon the scheduled expiration of the Term pursuant
to Section 3.4, above, Employer shall pay to Executive, on the Termination
Date,
an amount equal to (i) all accrued and unpaid salary and other compensation
payable to Executive by Employer and all accrued and unused vacation and
sick
pay payable to Executive by Employer with respect to services rendered by
Executive to Employer through the Termination Date; and, (ii) an amount equal
to
twelve (12) months salary based upon the then existing salary of Executive,
payable in the same manner as salary would have been paid to Executive had
he
continued to work for Employer hereunder.
6.8
Disputes
as to Termination.
If
either party disputes any aspect of Executive’s termination hereunder, the
disputing party shall demand arbitration of the dispute by written notice
to the
other no later than thirty (30) days after the applicable termination date.
The
costs of arbitration, including the fees and expenses of the arbitrator,
shall
be paid by Employer. Each Party shall bear the cost of preparing and presenting
its case including the use of any expert witness. Such arbitration shall
be
commenced not later than thirty (30) days following the date of delivery
of the
notice of arbitration by a panel of three qualified arbitrators, one who
shall
be designated by Executive, one by the Employer and one (who shall act as
chairman of the arbitration panel) by the first two arbitrators so appointed.
The arbitration shall be conducted in Orange County, California in accordance
with the rules promulgated and adopted by the American Arbitration Association
(with the right of discovery as provided in the California Code of Civil
Procedure by all Parties), and each Party shall retain the right to
cross-examine the opposing Party's witnesses, either through legal counsel,
expert witnesses or both. The majority decision of the arbitration panel
shall
be made in writing, and shall be final, binding and conclusive on all Parties
(without any right of appeal therefrom) and shall not be subject to judicial
review.
6.9 Termination
Date.
For
purposes of this Agreement, the term “Termination Date” shall mean that date on
which Executive’s employment is terminated pursuant to this Article
VI.
9
VII
INTENDED
TAX RESULTS
The
Parties believe that the payments pursuant to Section 5.5 and Article VI,
above,
do not constitute “Excess Parachute Payments” under Section 280G of the Internal
Revenue Code of 1986, as amended (the “Code”). Notwithstanding such belief and
intent, if any benefit under these provisions constitutes an “Excess Parachute
Payment”, Employer shall pay to Executive an additional amount (the “Tax
Payment”) such that (i) the excess of all Excess Parachute Payments (including
payments under this sentence) over the sum of excise tax thereon under Section
4999 of the Code and income tax thereon under Subtitle A of the Code and
under
applicable state law is equal to (ii) the excess of all Excess Parachute
Payments (excluding payments under this sentence) over income tax thereon
under
Subtitle A of the Code and under applicable state law is equal to (iii) the
excess of all Excess Parachute Payments (excluding payments under this sentence)
over income tax thereon under Subtitle A of the Code and under applicable
state
law. Such Tax Payment shall be paid to Executive concurrently with the severance
payment referred to in Section 5.5.2., above.
VIII
NO
MITIGATION
The
payments required to be paid to Executive by Employer pursuant to Section
5.5.2.
and Article VI, above, shall not be reduced by or mitigated by amounts which
Executive earns or is capable of earning during any period following his
Termination Date, and shall not be subject to any offsets, deductions, or
charges, other than as may be required under applicable Federal and State
tax
withholding and similar requirements.
IX
CONFIDENTIAL
INFORMATION AND RELATED COVENANTS
9.1 Trade
Secrets Covenants.
Executive shall not at any time, whether during or subsequent to the term
of
Executive’s employment, unless specifically consented to in writing by Employer,
either directly or indirectly use, divulge, disclose or communicate to any
person, firm, or corporation, in any manner whatsoever, any confidential
information concerning any matters affecting or relating to the business
of
Employer, including, but not limited to, the names, buying habits, or practices
of any of its customers, its’ marketing methods and related data, the names of
any of its vendors or suppliers, costs of materials, the prices it obtains
or
has obtained or at which it sells or has sold its products or services,
manufacturing and sales, costs, lists or other written records used in
Employer’s business, compensation paid to employees and other terms of
employment, or any other confidential information of, about or concerning
the
business of Employer, its manner of operation, or other confidential data
of any
kind, nature, or description. The Parties hereby stipulate that as between
them,
the foregoing matters are important, material, and confidential trade secrets
and affect the successful conduct of Employer’s business and its goodwill, and
that any breach of any term of this Section 9.1 is a material breach of this
Agreement.
10
9.2
Customer
Accounts Covenants.
As used
herein, the term “Customer Accounts” shall mean all accounts, clients,
customers, and the like of Employer and its affiliates, subsidiaries, licensees,
and business associations, whether now existing or hereafter developed or
acquired, including any and all accounts developed or acquired by or through
the
efforts of Executive. During and through the Term of this Agreement and
continuing for a period of twenty four (24) months immediately following
the
termination of Executive’s employment with Employer, Executive shall not
directly or indirectly make known to any person, firm, corporation or entity
the
names or addresses of any of the Customer Accounts or any other information
pertaining to them. During this same time period, Executive shall not, directly
or indirectly, for Executive or any other person, firm, corporation or entity,
divert, take away, call on or solicit, or attempt to divert, take away, call
on
or solicit, any of the Customer Accounts, including but not limited to those
Customer Accounts which Executive called or with whom Executive became
acquainted during Executive’s employment with Employer.
9.3
Employees
Covenant.
During
and through the Term of this Agreement and continuing for a period of twenty
four (24) months immediately following the termination of Executive’s employment
with Employer, Executive shall not, directly or indirectly, cause or induce,
or
attempt to cause or induce, any employee of Employer to terminate his or
her
employment with Employer, as such employment exists at any time following
the
execution of this Agreement.
9.4
Books
and Records.
All
equipment, notebooks, documents, memoranda, reports, files, samples, books,
correspondence, lists, computer disks and data bases, computer programs and
reports, computer software, and all other written, graphic and computer
generated or stored records affecting or relating to the business of Employer
which Executive shall prepare, use, construct, observe, possess, or control
shall be and remain the sole and exclusive property of Employer, and shall
constitute trade secret information of Employer. Within five (5) day so of
the
Termination Date, Executive shall promptly deliver to Employer all such
equipment, notebooks, documents, memoranda, reports, files, samples, books,
correspondence, lists, computer disks and data bases, computer programs and
reports, computer software, and all other written, graphic and computer
generated or stored records relating to the business of Employer which are
or
have been in the possession or under the control of Executive.
9.5
Injunctive
Relief.
Executive acknowledges that if Executive violates any of the provisions of
this
Article IX, it will be difficult to determine the amount of damages resulting
to
Employer. In addition to any other remedies which it may have, Employer shall
also be entitled to seek temporary and permanent injunctive relief without
the
necessity of proving actual damages.
9.6
Enforcement
of Covenants.
It
is the
desire and intent of the Parties that the provisions of this Article IX shall
be
enforced to the fullest extent permissible under the laws and public policies
applied in each jurisdiction in which enforcement is sought. Accordingly,
if any
particular portion of this Article IX shall be adjudicated to be invalid
or
unenforceable, this Article IX shall be deemed amended to delete therefrom
the
portion thus adjudicated to be invalid or unenforceable, such deletion to
apply
only with respect to the operation of this Article in the particular
jurisdiction in which such adjudication is made.
11
X
PROPRIETARY
INTEREST
10.1
Inventions.
All
inventions, improvements, ideas and disclosures (whether or not patentable)
conceived or reduced to practice (actually or constructively) by Executive
during the Term of this Agreement which are directly or indirectly related
to
Employer’s business shall be the property of Employer. Executive shall execute
and deliver to Employer, at Employer’s expense, all instruments of assignment
necessary to vest title to such intangible rights in Employer, and, if
requested, to execute all applications for issuance of Letters Patent in
the
United States or abroad and assignments thereof.
10.2
Specific
Exclusion.
Specifically excluded from this Article XI are any inventions which qualify
fully under California Labor Code §2870, which provides as follows:
(a)
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 that the employee developed
entirely on his or her own time without using the employer’s equipment,
supplies, facilities, or trade secret information except for those inventions
that either:
(1) Related
at the time of conception or reduction to practice of the invention to the
employer’s business, or actual or demonstrably anticipated research or
development of the employer; or
(2) Result
from any work performed by the employee for the employer.
(b)
To
the
extent a provision in an employment agreement purports to require an employee
to
assign an invention otherwise excluded from being required to be assigned
under
subdivision (a), the provision is against the public policy of this state
and is
unenforceable.
XI
REPRESENTATIONS
AND WARRANTIES OF EXECUTIVE
Executive
hereby represents and warrants to Employer the following as of and on the
day
this Agreement is executed:
(a)
The
execution, delivery, and consummation of this Agreement will comply with
all
applicable law and will not:
(i)
Violate
any judgment, order, writ or decree of any court or administrative body
applicable to Executive;
(ii)
Result
in
the breach of, constitute a default under, constitute an event which with
notice
or lapse of time, or both, would become a default under, or result in the
creation of any right to proceed against Employer under any agreement,
commitment, contract (written or oral) or other instrument to which Executive
is
a party.
12
(b)
Executive
is not subject to any non-compete, non-disclosure or similar agreement (whether
oral or written) with any third party.
XII
EXTENT
OF RELATIONSHIP
EXECUTIVE
HEREBY ACKNOWLEDGES THAT THIS AGREEMENT (AND ALL OTHER REFERENCES HEREIN)
THE
SOLE AGREEMENT BETWEEN EMPLOYER AND EXECUTIVE REGARDING THE EXTENT OF THE
EMPLOYMENT RELATIONSHIP BETWEEN EMPLOYER AND EXECUTIVE. THERE IS NO OTHER
AGREEMENT, EXPRESS OR IMPLIED, BETWEEN EMPLOYER AND EXECUTIVE FOR EMPLOYMENT
BEYOND THE TERM SPECIFIED HEREIN OR UNDER ANY CONDITIONS OTHER THAN THOSE
STATED
HEREIN. EMPLOYER AND EXECUTIVE BOTH HAVE THE RIGHT TO TERMINATE THIS AGREEMENT
ONLY IN STRICT COMPLIANCE WITH THE TERMS AND CONDITIONS OF THIS
AGREEMENT.
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_______________
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_______________
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|
Employer
Initials
|
Executive’s
Initials
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XIII
NOTICES
All
notices, requests, demands and other communications required or permitted
to be
given hereunder shall be effected pursuant to Section 14.13, below, as
follows:
|
If
to Employer:
|
With
a copy to:
|
|
Mr.
▇▇▇▇▇ ▇▇▇▇▇▇
|
▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇, Esq.
|
|
SPECTRUM
LAW GROUP, LLP
|
|
|
One
Technology Drive, Building H
|
▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
|
|
▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇
|
▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
|
If
to
Executive:
Mr.
J.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇
/
/ / / /
/
/ / / /
/
/ / / /
13
XIV
ADDITIONAL
PROVISIONS
14.1
Executed
Counterparts.
This
Agreement may be executed in any number of original, fax, electronic, or
copied
counterparts, and all counterparts shall be considered together as one
agreement. A faxed, electronic, or copied counterpart shall have the same
force
and effect as an original signed counterpart. Each of the Parties hereby
expressly forever waives any and all rights to raise the use of a fax machine
or
E-Mail to deliver a signature, or the fact that any signature or agreement
or
instrument was transmitted or communicated through the use of a fax machine
or
E-Mail, as a defense to the formation of a contract.
14.2
Successors
and Assigns.
Except
as expressly provided in this Agreement, each and all of the covenants, terms,
provisions, conditions and agreements herein contained shall be binding upon
and
shall inure to the benefit of the successors and assigns of the Parties
hereto.
14.3
Article
and Section Headings.
The
article and section headings used in this Agreement are inserted for convenience
and identification only and are not to be used in any manner to interpret
this
Agreement.
14.4
Severability.
Each
and every provision of this Agreement is severable and independent of any
other
term or provision of this Agreement. If any term or provision hereof is held
void or invalid for any reason by a court of competent jurisdiction, such
invalidity shall not affect the remainder of this Agreement.
14.5
Governing
Law.
This
Agreement shall be governed by the laws of the State of California, without
giving effect to any choice or conflict of law provision or rule (whether
of the
State of California or any other jurisdiction) that would cause the application
of the laws of any jurisdiction other than the State of California. If any
court
action is necessary to enforce the terms and conditions of this Agreement,
the
Parties hereby agree that the Superior Court of California, County of Orange,
shall be the sole jurisdiction and venue for the bringing of such action.
14.6
Entire
Agreement.
This
Agreement, and all references, documents, or instruments referred to herein,
contains the entire agreement and understanding of the Parties hereto in
respect
to the subject matter contained herein. The Parties have expressly not relied
upon any promises, representations, warranties, agreements, covenants, or
undertakings, other than those expressly set forth or referred to herein.
This
Agreement supersedes any and all prior written or oral agreements,
understandings, and negotiations between the Parties with respect to the
subject
matter contained herein.
14.7
Additional
Documentation.
The
Parties hereto agree to execute, acknowledge and cause to be filed and recorded,
if necessary, any and all documents, amendments, notices and certificates
which
may be necessary or convenient under the laws of the State of
California.
14.8
Attorney’s
Fees.
If any
legal action (including arbitration) is necessary to enforce the terms and
conditions of this Agreement, the prevailing Party shall be entitled to costs
and reasonable attorney’s fees.
14
14.9
Amendment.
This
Agreement may be amended or modified only by a writing signed by all
Parties.
14.10
Remedies.
14.10.1.
Specific
Performance.
The
Parties hereby declare that it is impossible to measure in money the damages
which will result from a failure to perform any of the obligations under
this
Agreement. Therefore, each Party waives the claim or defense that an adequate
remedy at law exists in any action or proceeding brought to enforce the
provisions hereof.
14.10.2.
Cumulative.
The
remedies of the Parties under this Agreement are cumulative and shall not
exclude any other remedies to which any person may be lawfully entitled.
14.11
Waiver.
No
failure by any Party to insist on the strict performance of any covenant,
duty,
agreement, or condition of this Agreement or to exercise any right or remedy
on
a breach shall constitute a waiver of any such breach or of any other covenant,
duty, agreement, or condition.
14.12
Assignability.
This
Agreement is not assignable by either Party without the expressed written
consent of all Parties.
14.13
Notices.
All
notices, requests and demands hereunder shall be in writing and delivered
by
hand, by facsimile transmission, by mail, by telegram or by recognized
commercial over-night delivery service (such as Federal Express, UPS or DHL),
and shall be deemed given (a) if by hand delivery, upon such delivery; (b)
if by
facsimile transmission, upon telephone confirmation of receipt of same; (c)
if
by mail, forty-eight (48) hours after deposit in the United States mail,
first
class, registered or certified mail, postage prepaid; (d) if by telegram,
upon
telephone confirmation of receipt of same; or, (e) if by recognized commercial
over-night delivery service, upon such delivery.
14.14
Time.
All
Parties agree that time is of the essence as to this Agreement.
14.15
Disputes.
The
Parties agree to cooperate and meet in order to resolve any disputes or
controversies arising under this Agreement. Should they be unable to do so,
then
either may elect arbitration under the rules of the American Arbitration
Association, and both Parties are obligated to proceed thereunder, to resolve
all disputes, other than those arising under Section 6.8, above. Arbitration
shall proceed in Orange County, and the Parties agree to be bound by the
arbitrator’s award, which may be filed in the
Superior
Court of California, County of Orange. The
Parties consent to the jurisdiction of California Courts for enforcement
of this
determination by arbitration. The prevailing Party shall be entitled to
reimbursement for his attorney’s fees and all costs associated with arbitration.
In any arbitration proceeding conducted pursuant to the provisions of this
Section, both Parties shall have the right to conduct discovery, to call
witnesses and to cross-examine the opposing Party’s witnesses, either through
legal counsel, expert witnesses or both, and the provisions of the California
Code of Civil Procedure (Right to Discovery; Procedure and Enforcement) are
hereby incorporated into this Agreement by this reference and made a part
hereof.
15
14.16
Provision
Not Construed Against Party Drafting Agreement.
This
Agreement is the result of negotiations by and between the Parties, and each
Party has had the opportunity to be represented by independent legal counsel
of
its choice. This Agreement is the product of the work and efforts of all
Parties, and shall be
deemed
to have been drafted by all Parties. In the event of a dispute, no Party
hereto
shall be entitled to claim that any provision should be construed against
any
other Party by reason of the fact that it was drafted by one particular
Party.
14.17
Incorporation
of Exhibits and Schedules.
The
Exhibits and Schedules identified in this Agreement are incorporated herein
by
reference and made a part hereof as if set out in full herein.
14.18
Recitals.
The
facts recited in Article II, above, are hereby conclusively presumed to be
true
as between and affecting the Parties.
14.19
Consents,
Approvals, and Discretion.
Except
as herein expressly provided to the contrary, whenever this Agreement requires
consent or approval to be given by a Party, or a Party must or may exercise
discretion, the Parties agree that such consent or approval shall not be
unreasonably withheld, conditioned, or delayed, and such discretion shall
be
reasonably exercised. Except as otherwise provided herein, if no response
to a
consent or request for approval is provided within ten (10) days from the
receipt of the request, then the consent or approval shall be presumed to
have
been given.
14.20
No
Third Party Beneficiaries.
This
Agreement has been entered into solely by and between Employer and Executive,
solely for their benefit. There is no intent by either Party to create or
establish a third party beneficiary to this Agreement, and no such third
party
shall have any right to enforce any right, claim, or cause of action created
or
established under this Agreement.
14.21
Best
Efforts.
The
Parties shall use and exercise their best efforts, taking all reasonable,
ordinary and necessary measures to ensure an orderly and smooth relationship
under this Agreement, and further agree to work together and negotiate in
good
faith to resolve any differences or problems which may arise in the
future.
14.22
Definitional
Provisions.
For
purposes of this Agreement, (i) those words, names, or terms which are
specifically defined herein shall have the meaning specifically ascribed
to
them; (ii) wherever from the context it appears appropriate, each term stated
either in the singular or plural shall include the singular and plural; (iii)
wherever from the context it appears appropriate, the masculine, feminine,
or
neuter gender, shall each include the others; (iv) the words “hereof”, “herein”,
“hereunder”, and words of similar import, when used in this Agreement, shall
refer to this Agreement as a whole, and not to any particular provision of
this
Agreement; (v) all references to designated “Articles”, “Sections”, and to other
subdivisions are to the designated Articles, Sections, and other subdivisions
of
this Agreement as originally executed; (vi) all references to “Dollars” or “$”
shall be construed as being United States dollars; (vii) the
term
“including” is not limiting and means “including without limitation”;
and,
(viii) all references to all statutes, statutory provisions, regulations,
or
similar administrative provisions shall be construed as a reference to such
statute, statutory provision, regulation, or similar administrative provision
as
in force at the date of this Agreement and as may be subsequently amended.
16
14.23
Survival.
Notwithstanding anything herein to the contrary, the provisions of Section
5.6
and Articles VI, VII, VIII, and IX, inclusive, shall expressly survive the
termination of this Agreement.
XV
EXECUTION
IN
WITNESS WHEREOF,
this
EXECUTIVE EMPLOYMENT AGREEMENT has been duly executed by the Parties in Orange
County, California, and shall be effective as of and on the Effective Date
set
forth in Article I of this Agreement. Each of the undersigned Parties hereby
represents and warrants that it (i) has the requisite power and authority
to
enter into and carry out the terms and conditions of this Agreement, as well
as
all transactions contemplated hereunder; and, (ii) it is duly authorized
and
empowered to execute and deliver this Agreement.
|
EMPLOYER:
|
EXECUTIVE:
|
|
a
California corporation
|
|
|
_____________________________
|
|
|
J.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
|
|
|
BY:
__________________________
|
DATED:
______________________
|
|
NAME:
_______________________
|
|
|
TITLE:
_______________________
|
|
|
DATED:
______________________
|
17
EXHIBIT
3.1
SERVICES
18
EXHIBIT
4.1
BASE
ANNUAL SALARY
FirstTwelveMonths $320,000.00
annually
Thereafter,
no less
than
$320,000 and
increased in accordance with performance based incentives to be determined
by
Employer.
19
EXHIBIT
5.4
INDEMNIFICATION
AGREEMENT
20