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EMPLOYMENT AGREEMENT
This Agreement is executed December 22, 1997 to be retroactively effective to
October 1, 1997 (the "Effective Date") between SVI Holdings, Inc., a Nevada
corporation (the "Company"), having an address for notices at 0000 Xxxxxxx
Xxxxxx, Xxxxx 000, Xx Xxxxx, Xxxxxxxxxx 00000 and Xxxxx Xxxxxxxxx ("Executive"),
having an address for notices at 0000 Xxxxxxx Xxxxxx, Xxxxx 000, Xx Xxxxx,
Xxxxxxxxxx 00000, who agree as follows:
1. Hiring. The Company hereby hires Executive as, and Executive hereby
agrees to act as President and Chief Executive Officer of the Company.
2. Duties. Executive shall faithfully and diligently perform the following
duties on a full-time basis: (a) Devoting Executive's entire productive time,
ability and attention to the business of the Company; (b) Performing such
other duties as the board of directors of the Company (the "Board"), shall
from time to time specify that are consistent with the duties normally
performed by a Chief Executive Officer; and (c) reporting directly to the
Board.
3. Base Compensation. Executive's total compensation ("Base Compensation")
under this Agreement shall be:
First Year $15,000 per month
Second Year $20,000 per month
Third Year $25,000 per month
payable monthly in arrears from the Effective Date, in accordance with and at
the same times as the Company's ordinary payroll procedures.
4. Additional Compensation. As additional compensation, Executive shall
receive, on each anniversary of his employment under this Agreement, the
option to purchase from the Company up to a number of shares (the "Option
Shares") equal to 150% of the Executive's Base Compensation, for the preceding
year, divided by the average price per share of the Company for the 30 day
period immediately preceding such anniversary (the "Option Price"). The Share
Option may be exercised by the Executive, in whole or in part, at any time
within five years of the date of the applicable anniversary by written notice
tendering payment of the Option Price. Such Option shall become fully vested
upon each applicable anniversary and may be assigned by the Executive.
5. Benefits. Executive shall be entitled to the following benefits during
the term of this Agreement:
5.1. Twenty (20) business days paid vacation for each one-year period during
the term of this Agreement (prorated for any partial year), to be taken at
such times that are consistent with Executive's performance of Executive's
duties under this Agreement.
5.2. Reimbursement for reasonable out-of-town travel expenses and local
expenses incurred in the proper performance of Executive's duties under this
Agreement, in accordance with the Company's policy.
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5.3. Reimbursement for reasonable expenses, including reasonable and
customary automobile expenses, incurred in the proper performance of
Executive's duties under this Agreement and in accordance with the Company's
policy.
5.4. Inclusion in the Company's medical plan for the Company's other
Executives.
5.5. All benefits generally available to other officers of the Company.
6. Term. The term of this Agreement shall commence on the Effective Date and
unless terminated earlier as set forth below, shall expire on September 30,
2000. Upon expiration of this Agreement, the parties shall negotiate, in good
faith, an extension of the contract on such terms and conditions as shall
reasonably be agreed to. At any time that Good Cause (as defined below)
exists or has arisen, the Company may, at its election, terminate this
Agreement upon 14 days written notice. For purposes of this Agreement, "Good
Cause" shall mean the existence or occurrence of any of the following:
6.1. Any repeated breach of duty by Executive, or any repeated failure by
Executive to perform such duties as may be delegated to Executive by the
Company from time to time after written notice specifying such breach or
failure which Executive fails to cure within fourteen (14) days of receipt of
such notice.
6.2. If Executive is convicted of a felony.
6.3. If Executive commits theft, larceny, embezzlement, fraud, any acts of
dishonesty, illegality, moral turpitude or gross mismanagement.
6.4. If Executive otherwise materially and repeatedly breaches any provision
of this Agreement.
6.5. The death of Executive.
6.6. If Executive becomes materially disabled to such an extent that
Executive is precluded from performing the duties set forth in this Agreement
for a period of six (6) months.
7. Confidentiality. Executive hereby acknowledges that the Company has made
(or may make) available to Executive certain customer lists, product design
information, performance standards and other confidential and/or proprietary
information of the Company or licensed to the Company, including without
limitation trade secrets, copyrighted materials and/or financial information
of the Company (or any of its affiliates) including without limitation
financial statements, reports and data (collectively, the "Confidential
Material"). Except as essential to Executive's obligations under this
Agreement, neither Executive nor any agent, employee, officer, or independent
contractor of or retained by Executive shall make any disclosure of this
Agreement, the terms of this Agreement, or any of the Confidential Material.
Except as essential to Executive's obligations under this Agreement, neither
Executive nor any agent, employee, officer, or independent contractor of or
retained by Executive shall make any duplication or other copy of any of the
Confidential Material. Immediately upon request from the Company, Executive
shall return to the Company all Confidential Material. Executive shall notify
each person to whom any disclosure is made that such disclosure is made in
confidence, that the Confidential Material shall be kept in confidence by such
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person, and that such person shall be bound by the provisions of this
Paragraph.
8. Proprietary Information. For purposes of this Agreement, "Proprietary
Information" shall mean any information, observation, data, written material,
record, document, computer program, software, firmware, invention, discovery,
improvement, development, tool, machine, apparatus, appliance, design,
promotional idea, customer list, practice, process, formula, method,
technique, trade secret, product and/or research related to the actual or
anticipated research, development, products, organization, business or
finances of the Company (or any of its affiliates). All right, title and
interest of every kind and nature whatsoever in and to the Proprietary
Information made, discussed, developed, secured, obtained or learned by
Executive during the term of this Agreement, or the 60-day period immediately
following termination of this Agreement, shall be the sole and exclusive
property of the Company for any purposes or uses whatsoever, and shall be
disclosed promptly by Executive to the Company. The covenants set forth in
the preceding sentence shall apply regardless of whether any Proprietary
Information is made, discovered, developed, secured, obtained or learned (a)
solely or jointly with others, (b) during the usual hours of work or
otherwise, (c) at the request and upon the suggestion of the Company or
otherwise, or (d) with the Company's materials, tools, instruments or on the
Company's premises or otherwise. All Proprietary Information developed,
created, invented, devised, conceived or discovered by Executive that are
subject to copyright protection are explicitly considered by Executive and the
Company to be works made for hire to the extent permitted by law. Executive
hereby assigns to the Company all of Executive's right, title and interest in
and to the Proprietary Information. Executive hereby forever fully releases
and discharges the Company, any affiliates of the Company and their respective
officers, directors and employees, from and against any and all claims,
demands, damages, liabilities, costs and expenses of Executive arising out of,
or relating to, any Proprietary Information. Executive shall execute any
documents and take any action the Company may deem necessary or appropriate to
effectuate the provisions of this Agreement, including without limitation
assisting the Company in obtaining and/or maintaining patents, copyrights or
similar rights to any Proprietary Information assigned to the Company, if the
Company, in its sole discretion, requests such assistance. Executive shall
comply with any reasonable rules established from time to time by the Company
for the protection of the confidentiality of any Proprietary Information.
Executive irrevocably appoints the Chairman of the Company to act as
Executive's agent and attorney-in-fact to perform all acts necessary to obtain
and/or maintain patents, copyrights and similar rights to any Proprietary
Information assigned by Executive to the Company under this Agreement if (a)
Executive refuses to perform those acts, or (b) is unavailable, within the
meaning of any applicable laws. Executive acknowledges that the grant of the
foregoing power of attorney is coupled with an interest and shall survive the
death or disability of Executive. Executive shall promptly disclose to the
Company, in confidence (a) all Proprietary Information that Executive creates
during the term of this Agreement, and (b) all patent applications filed by
Executive within one year after termination of this Agreement. Any
application for a patent, copyright registration or similar right filed by
Executive within one year after termination of this Agreement shall be
presumed to relate to Proprietary Information created by Executive during the
term of this Agreement, unless Executive can prove otherwise. Nothing
contained in this Agreement shall be construed to preclude the Company from
exercising all of its rights and privileges as sole and exclusive owner of all
of the Proprietary Information owned by or assigned to the Company under this
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Agreement. The Company, in exercising such rights and privileges with respect
to any particular item of Proprietary Information, may decide not to file any
patent application or any copyright registration on such Proprietary
Information, may decide to maintain such Proprietary Information as secret and
confidential, or may decide to abandon such Proprietary Information or
dedicate it to the public. Executive shall have no authority to exercise any
rights or privileges with respect to the Proprietary Information owned by or
assigned to the Company under this Agreement. This Agreement does not apply
to any Proprietary Information that qualifies fully under the provisions of
California Labor Code Section 2870 or any similar or successor statute.
9. Survival. The representations, warranties and covenants of Executive in
this Agreement shall survive any termination of this Agreement.
10. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
11. Further Assurances. Each party to this Agreement shall execute all
instruments and documents and take all actions as may be reasonably required
to effectuate this Agreement.
12. Venue and Jurisdiction. For purposes of venue and jurisdiction, this
Agreement shall be deemed made and to be performed in the City of San Diego,
California.
13. Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original and all of which together shall constitute
one document.
14. Time of Essence. Time and strict and punctual performance are of the
essence with respect to each provision of this Agreement.
15. Attorney's Fees. In the event any litigation, arbitration, mediation, or
other proceeding ("Proceeding") is initiated by any party(ies) against any
other party(ies) to enforce, interpret or otherwise obtain judicial or
quasi-judicial relief in connection with this Agreement, the prevailing
party(ies) in such Proceeding shall be entitled to recover from the
unsuccessful party(ies) all costs, expenses, and actual attorney's fees
relating to or arising out of (d) such Proceeding (whether or not such
Proceeding proceeds to judgment), and (e) any post-judgment or post-award
proceeding including without limitation one to enforce any judgment or award
resulting from any such Proceeding. Any such judgment or award shall contain
a specific provision for the recovery of all such subsequently incurred costs,
expenses, and actual attorney's fees.
16. Modification. This Agreement may be modified only by a contract in
writing executed by the party(ies) to this Agreement against whom enforcement
of such modification is sought.
17. Headings. The headings of the Paragraphs of this Agreement have been
included only for convenience, and shall not be deemed in any manner to modify
or limit any of the provisions of this Agreement, or be used in any manner in
the interpretation of this Agreement.
18. Prior Understandings. This Agreement contains the entire agreement
between the parties to this Agreement with respect to the subject matter of
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this Agreement, is intended as a final expression of such parties' agreement
with respect to such terms as are included in this Agreement, is intended as a
complete and exclusive statement of the terms of such agreement, and
supersedes all negotiations, stipulations, understandings, agreements,
representations and warranties, if any, with respect to such subject matter,
which precede or accompany the execution of this Agreement.
19. Interpretation. Whenever the context so requires in this Agreement, all
words used in the singular shall be construed to have been used in the plural
(and vice versa), each gender shall be construed to include any other genders,
and the word "person" shall be construed to include a natural person, a
corporation, a firm, a partnership, a joint venture, a trust, an estate or any
other entity.
20. Partial Invalidity. Each provision of this Agreement shall be valid and
enforceable to the fullest extent permitted by law. If any provision of this
Agreement or the application of such provision to any person or circumstance
shall, to any extent, be invalid or unenforceable, the remainder of this
Agreement, or the application of such provision to persons or circumstances
other than those as to which it is held invalid or unenforceable, shall not be
affected by such invalidity or unenforceability, unless such provision or such
application of such provision is essential to this Agreement.
21. Notices. All notices or other communications required or permitted to be
given to a party to this Agreement shall be in writing and shall be personally
delivered, sent by certified mail, postage prepaid, return receipt requested,
or sent by an overnight express courier service that provides written
confirmation of delivery, to such party at its address as set forth above in
the introductory Paragraph of this Agreement. Each such notice or other
communication shall be deemed given, delivered and received upon its actual
receipt, except that if it is sent by mail in accordance with this Paragraph,
then it shall be deemed given, delivered and received three days after the
date such notice or other communication is deposited with the United States
Postal Service in accordance with this Paragraph. Any party to this Agreement
may give a notice of a change of its address to the other party(ies) to this
Agreement.
22. Drafting Ambiguities. Each party to this Agreement has reviewed and
revised this Agreement. Each party to this Agreement has had the opportunity
to have such party's legal counsel review and revise this Agreement. The rule
of construction that any ambiguities are to be resolved against the drafting
party shall not be employed in the interpretation of this Agreement or of any
amendments or exhibits to this Agreement.
SVI HOLDINGS, INC., a Nevada corporation
By:/s/ Xxxxxxx Xxxxxxxxx
Vice President / Secretary
EMPLOYEE
/s/ Xxxxx Xxxxxxxxx
Chief Executive Officer
XXXXX XXXXXXXXX
