EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement ("Agreement") is made effective as of
the closing of the acquisition of April 1, 2004 ("Effective Date"), by and
between PeopleView, Inc. ("Company") and Xxxxxx X. Xxxxx ("Executive").
The parties agree as follows:
1. Employment. Company hereby employs Executive, and Executive hereby
accepts such employment, upon the terms and conditions set forth herein.
2. Duties.
2.1 Position. Executive is employed as Company's Chief Executive
Officer and Chairman of the Board of Directors with a and shall have the duties
and responsibilities assigned by the Company's Board of Directors both upon
initial hire and as may be reasonably assigned from time to time. Executive
shall perform faithfully and diligently all duties assigned to Executive.
Company reserves the right to modify Executive's position and duties at any time
in its sole and absolute discretion. Further, Executive is employed as President
and Chief Operating Officer of The Mayo Group, Inc. a subsidiary of the Company
and a and shall have the duties and responsibilities assigned by the Company's
Chief Executive Officer and attached in Exhibit B.
2.2 Best Efforts/Full-time. Executive will expend Executive's best
efforts on behalf of Company and its subsidiaries, and will abide by all
policies and decisions made by Company, as well as all applicable federal, state
and local laws, regulations or ordinances. Executive will act in the best
interest of Company at all times. Executive shall devote Executive's full
business time and efforts to the performance of Executive's assigned duties for
Company, unless Executive notifies the Board of Directors in advance of
Executive's intent to engage in other paid work and receives the Board of
Directors' express written consent to do so.
3. Term.
3.1 Initial Term. The employment relationship pursuant to this
Agreement shall be for an initial term commencing on the Effective Date set
forth above and continuing for a period of two (2) years following such date
("Initial Term"), unless sooner terminated in accordance with paragraph 7 below.
3.2 Renewal. On completion of the Initial Term specified in
subparagraph 3.1 above, this Agreement will automatically renew for subsequent
12 months terms unless either party provides advance written notice to the other
that Company/Executive does not wish to renew the Agreement for a subsequent 12
months. In the event either party gives notice of nonrenewal pursuant to this
subparagraph 3.2, this Agreement will expire at the end of the current term.
4. Compensation.
4.1 Base Salary. As compensation for Executive's performance of
Executive's duties hereunder, Company shall pay to Executive an initial Base
Salary of $165,000 per year, payable in accordance with the normal payroll
practices of Company, less required deductions for state and federal withholding
tax, social security and all other employment taxes and payroll deductions. In
the event Executive's employment under this Agreement is terminated by either
party, for any reason, Executive will be entitled to receive Executive's Base
Salary prorated to the date of termination.
4.2 Incentive Compensation. Executive will be eligible to earn
incentive compensation in accordance with the provisions set forth in Exhibit A.
5. Customary Fringe Benefits. Executive will be eligible for all customary
and usual fringe benefits generally available to executives of Company subject
to the terms and conditions of Company's benefit plan documents. Company
reserves the right to change or eliminate the fringe benefits on a prospective
basis, at any time, effective upon notice to Executive.
6. Business Expenses. Executive will be reimbursed for all reasonable,
out-of-pocket business expenses incurred in the performance of Executive's
duties on behalf of Company. To obtain reimbursement, expenses must be submitted
promptly with appropriate supporting documentation in accordance with Company's
policies.
7. Termination of Executive's Employment.
7.1 Termination for Cause by Company. Although Company anticipates a
mutually rewarding employment relationship with Executive, Company may terminate
Executive's employment immediately at any time for Cause. For purposes of this
Agreement, "Cause" is defined as: (a) acts or omissions constituting gross
negligence, recklessness or willful misconduct on the part of Executive with
respect to Executive's obligations or otherwise relating to the business of
Company; (b) Executive's material breach of this Agreement; (c) Executive's
conviction or entry of a plea of nolo contendere for fraud, misappropriation or
embezzlement, or any felony or crime of moral turpitude; (d) Executive's willful
neglect of duties as determined in the sole and exclusive discretion of the
Board of Directors; (e) Executive's failure to perform the essential functions
of Executive's position, with or without reasonable accommodation due to a
mental or physical disability, due to a mental or physical disability; and (f)
Executive's death. In the event Executive's employment is terminated for Cause
in accordance with this subparagraph 7.1, Executive shall be entitled to no
further benefits or payments under this Agreement and all obligations of Company
under this Agreement shall become automatically terminated and completely
extinguished, provided that if Executive's employment is terminated pursuant to
Section 7.1(f) then Executive's estate shall be entitled to six (6) months
additional base compensation under this Agreement and the immediate vesting of
all unvested stock options (provided, however, that such vested options shall be
exercised in accordance with the Company's stock option plan).
7.2 Termination Without Cause by Company/Severance. Company may
terminate Executive's employment under this Agreement without Cause at any time
on thirty (30) days' advance written notice to Executive. In the event of such
termination, Executive will receive the Base Salary then in effect, prorated to
the date of termination, and a "Severance Payment" equivalent to (a) payment of
compensation for an additional six (6) months, payable in accordance with
Company's regular payroll cycle or lump sum, and (b) an additional provision of
accelerating all unvested stock options and warrants provided that: (a)
Executive complies with all surviving provisions of this Agreement as specified
in subparagraph 13.8 below; (b) Executive executes a full general release,
releasing all claims, known or unknown, that Executive may have against Company
arising out of or any way related to Executive's employment or termination of
employment with Company, and (c) such vested options shall be exercised in
accordance with the Company's stock option plan.
7.3 Voluntary Resignation by Executive for Good Reason/Severance.
Executive may voluntarily resign Executive's position with Company for Good
Reason, at any time on thirty (30) days' advance written notice. In the event of
Executive's resignation for Good Reason, Executive will be entitled to receive
the Base Salary then in effect, prorated to the date of termination, and the
Severance Payment described in subparagraph 7.2. above, provided Executive
complies with all of the conditions in subparagraph 7.2. above. All other
Company obligations to Executive pursuant to this Agreement will become
automatically terminated and completely extinguished. Executive will be deemed
to have resigned for Good Reason in the following circumstances: (a) Company's
material breach of this Agreement; (b) Executive's Base Salary is reduced by
more than 30% below Executive's salary in effect at any time during the
preceding twelve months, unless the reduction is made as part of, and is
generally consistent with, a general reduction of senior executive salaries; and
(c) Company relocates Executive's principal place of work to a location more
than sixty (60) miles from Newport Beach, California, without Executive's prior
written approval.
7.4 Voluntary Resignation by Executive Without Good Reason.
Executive may voluntarily resign Executive's position with Company without Good
Reason, at any time after the Initial Term, on thirty (30) days' advance written
notice. In the event of Executive's resignation without Good Reason, Executive
will be entitled to receive only the Base Salary for the thirty-day notice
period if any. All other Company obligations to Executive pursuant to this
Agreement will become automatically terminated and completely extinguished. In
addition, executive will not be entitled to receive the Severance Payment
described in subparagraph 7.2. above.
7.5 Termination of Employment Upon Nonrenewal. In the event either
party decides not to renew this Agreement for a subsequent 12 months in
accordance with subparagraph 3.2 above, the Agreement will expire, Executive's
employment with Company will terminate and Executive will only be entitled to
Executive's Base Salary paid through the last day of the current term. All other
Company obligations to Executive pursuant to this Agreement will become
automatically terminated and completely extinguished. Executive will not be
entitled to the Severance Payment described in subparagraph 7.2 above.
8. No Conflict of Interest. During the term of Executive's employment with
Company and during any period Executive is receiving payments from Company,
Executive must not engage in any work, paid or unpaid, that creates an actual or
potential conflict of interest with Company. Such work shall include, but is not
limited to, directly or indirectly competing with Company in any way, or acting
as an officer, director, employee, consultant, stockholder, volunteer, lender,
or agent of any business enterprise of the same nature as, or which is in direct
competition with, the business in which Company is now engaged or in which
Company becomes engaged during the term of Executive's employment with Company,
as may be determined by the Board of Directors in its sole discretion. If the
Board of Directors believes such a conflict exists during the term of this
Agreement, the Board of Directors may ask Executive to choose to discontinue the
other work or resign employment with Company. If the Board of Directors believes
such a conflict exists during any period in which Executive is receiving
payments pursuant to this Agreement, the Board of Directors may ask Executive to
choose to discontinue the other work or forfeit the remaining severance
payments. In addition, Executive agrees not to refer any client or potential
client of Company to competitors of Company, without obtaining Company's prior
written consent, during the term of Executive's employment and during any period
in which Executive is receiving payments from Company pursuant to this
Agreement.
9. Confidentiality and Proprietary Rights. Executive agrees to read, sign
and abide by Company's Employee Innovations and Proprietary Rights Assignment
Agreement, which is provided with this Agreement and incorporated herein by
reference.
10. Non-Solicitation.
10.1 Nonsolicitation of Customers or Prospects. Executive
acknowledges that information about Company's customers is confidential and
constitutes trade secrets. Accordingly, Executive agrees that during the term of
this Agreement and for a period of one (1) year after the termination of this
Agreement, Executive will not, either directly or indirectly, separately or in
association with others, interfere with, impair, disrupt or damage Company's
relationship with any of its customers or customer prospects by soliciting or
encouraging others to solicit any of them for the purpose of diverting or taking
away business from Company.
10.2 Nonsolicitation of Company's Employees. Executive agrees that
during the term of this Agreement and for a period of one (1) year after the
termination of this Agreement, Executive will not, either directly or
indirectly, separately or in association with others, interfere with, impair,
disrupt or damage Company's business by soliciting, encouraging or attempting to
hire any of Company's employees or causing others to solicit or encourage any of
Company's employees to discontinue their employment with Company.
11. Injunctive Relief. Executive acknowledges that Executive's breach of
the covenants contained in paragraphs 8-10 (collectively "Covenants") would
cause irreparable injury to Company and agrees that in the event of any such
breach, Company shall be entitled to seek temporary, preliminary and permanent
injunctive relief without the necessity of proving actual damages or posting any
bond or other security.
12. Agreement to Arbitrate. To the fullest extent permitted by law,
Executive and Company agree to arbitrate any controversy, claim or dispute
between them arising out of or in any way related to this Agreement, the
employment relationship between Company and Executive and any disputes upon
termination of employment, including but not limited to breach of contract,
tort, discrimination, harassment, wrongful termination, demotion, discipline,
failure to accommodate, family and medical leave, compensation or benefits
claims, constitutional claims; and any claims for violation of any local, state
or federal law, statute, regulation or ordinance or common law. Claims for
workers' compensation, unemployment insurance benefits and Company's right to
obtain injunctive relief pursuant to paragraph 11 above are excluded. For the
purpose of this agreement to arbitrate, references to "Company" include all
parent, subsidiary or related entities and their employees, supervisors,
officers, directors, agents, pension or benefit plans, pension or benefit plan
sponsors, fiduciaries, administrators, affiliates and all successors and assigns
of any of them, and this agreement shall apply to them to the extent Executive's
claims arise out of or relate to their actions on behalf of Company.
12.1 Consideration. The mutual promise by Company and Executive to
arbitrate any and all disputes between them rather than litigate them before the
courts or other bodies, provides the consideration for this agreement to
arbitrate.
12.2 Initiation of Arbitration. Either party may exercise the right
to arbitrate by providing the other party with written notice of any and all
claims forming the basis of such right in sufficient detail to inform the other
party of the substance of such claims. In no event shall the request for
arbitration be made after the date when institution of legal or equitable
proceedings based on such claims would be barred by the applicable statute of
limitations.
12.3 Arbitration Procedure. The arbitration will be conducted in
Irvine, California by a single neutral arbitrator and in accordance with the
then current rules for resolution of employment disputes of the American
Arbitration Association ("AAA"). The parties are entitled to representation by
an attorney or other representative of their choosing. The arbitrator shall have
the power to enter any award that could be entered by a judge of the trial court
of the State of California, and only such power, and shall follow the law. In
the event the arbitrator does not follow the law, the arbitrator will have
exceeded the scope of his or her authority and the parties may, at their option,
file a motion to vacate the award in court. The parties agree to abide by and
perform any award rendered by the arbitrator. Judgment on the award may be
entered in any court having jurisdiction thereof.
12.4 Costs of Arbitration. Each party shall bear one half the cost
of the arbitration filing and hearing fees, and the cost of the arbitrator.
13. General Provisions.
13.1 Successors and Assigns. The rights and obligations of Company
under this Agreement shall inure to the benefit of and shall be binding upon the
successors and assigns of Company. Executive shall not be entitled to assign any
of Executive's rights or obligations under this Agreement.
13.2 Waiver. Either party's failure to enforce any provision of this
Agreement shall not in any way be construed as a waiver of any such provision,
or prevent that party thereafter from enforcing each and every other provision
of this Agreement.
13.3 Attorneys' Fees. Each side will bear its own attorneys' fees in
any dispute unless a statutory section at issue, if any, authorizes the award of
attorneys' fees to the prevailing party.
13.4 Severability. In the event any provision of this Agreement is
found to be unenforceable by an arbitrator or court of competent jurisdiction,
such provision shall be deemed modified to the extent necessary to allow
enforceability of the provision as so limited, it being intended that the
parties shall receive the benefit contemplated herein to the fullest extent
permitted by law. If a deemed modification is not satisfactory in the judgment
of such arbitrator or court, the unenforceable provision shall be deemed
deleted, and the validity and enforceability of the remaining provisions shall
not be affected thereby.
13.5 Interpretation; Construction. The headings set forth in this
Agreement are for convenience only and shall not be used in interpreting this
Agreement. This Agreement has been drafted by legal counsel representing
Company, but Executive has participated in the negotiation of its terms.
Furthermore, Executive acknowledges that Executive has had an opportunity to
review and revise the Agreement and have it reviewed by legal counsel, if
desired, and, therefore, the normal rule of construction to the effect that any
ambiguities are to be resolved against the drafting party shall not be employed
in the interpretation of this Agreement.
13.6 Governing Law. This Agreement will be governed by and construed
in accordance with the laws of the United States and the State of California.
Each party consents to the jurisdiction and venue of the state or federal courts
in Orange County, California, if applicable, in any action, suit, or proceeding
arising out of or relating to this Agreement.
13.7 Notices. Any notice required or permitted by this Agreement
shall be in writing and shall be delivered as follows with notice deemed given
as indicated: (a) by personal delivery when delivered personally; (b) by
overnight courier upon written verification of receipt; (c) by telecopy or
facsimile transmission upon acknowledgment of receipt of electronic
transmission; or (d) by certified or registered mail, return receipt requested,
upon verification of receipt. Notice shall be sent to the addresses set forth
below, or such other address as either party may specify in writing.
13.8 Survival. Sections 8 ("No Conflict of Interest"), 9
("Confidentiality and Proprietary Rights"), 10 (Nonsolicitation), 11
("Injunctive Relief"), 12 ("Agreement to Arbitrate"), 13 ("General Provisions")
and 14 ("Entire Agreement") of this Agreement shall survive Executive's
employment by Company.
14. Entire Agreement. This Agreement, including the Company Employee
Innovations and Proprietary Rights Assignment Agreement incorporated herein by
reference and Company's stock option plan and related option documents described
in paragraph 4.3 of this Agreement, constitutes the entire agreement between the
parties relating to this subject matter and supersedes all prior or simultaneous
representations, discussions, negotiations, and agreements, whether written or
oral. This Agreement may be amended or modified only with the written consent of
Executive and the Board of Directors of Company. No oral waiver, amendment or
modification will be effective under any circumstances whatsoever.
THE PARTIES TO THIS AGREEMENT HAVE READ THE FOREGOING AGREEMENT AND FULLY
UNDERSTAND EACH AND EVERY PROVISION CONTAINED HEREIN. WHEREFORE, THE PARTIES
HAVE EXECUTED THIS AGREEMENT ON THE DATES SHOWN BELOW.
XXXXXX X. XXXXX
Dated:
--------------------------- ----------------------------------
00 Xxx Xxxxxxx
Xxx Xxxxxxxx, XX. 00000
PeopleView, Inc.
Dated: By:
--------------------------- ----------------------------------
Xxxxxxx X. Xxxxxxxxxx
Compensation Committee Chairperson
PeopleView, Inc.
27130 A Xxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxx Xxxxxxxxxx, XX. 92675
EXHIBIT A
COMPANY'S INCENTIVE COMPENSATION PLAN
Incentive Compensation:
2004--Pre Reverse Split
a. 250,000 options granted in a 3-- year vesting schedule
b. 750,000 warrants terms as such:
1. 250,000 upon closing of acquisition of The Mayo Group, Inc.
2. 250,000 if the Company's revenues and EBITDA for fiscal year
2004 exceed the threshold amounts set forth in the Agreement
and Plan of Merger dated as of April 1, 2004 between the
Company, The Mayo Group, Inc., the shareholders of The Mayo
Group, Inc., and PPVW Acquisition Corporation (the "Merger
Agreement").
3. 250,000 if the Company's revenues and EBITDA for fiscal year
2005 exceed the targets set forth in the Mayo Group, Inc.
Merger 2004 Integration Plan (Exhibit H) described in the
Merger Agreement.
The warrants subject to the contingencies in items 2 and 3 above will be
placed in escrow and released to Executive within thirty days after
audited numbers are achieved and released for the applicable periods.
Should however, the actual 2004 and 2005 EBITDA amount achieved by the
Company be less than 100% of the target, but 75% or more of the target,
Executive will be entitled to an equally reduced ratio of these warrants
(between 75% and 100%). In the event that less than 75% of the 2004 or
2005 target EBITDA is achieved by the Company, Executive will not be
entitled to any percentage of the contingent warrants. The warrants will
have a 5 year term.
c. Participation in the Corporate Executive Bonus Plan. The plan will be
based on 7.5% of EBITDA for 2004, and 6% of EBITDA for 2005. The Executive
will be capped at $50,000 in bonus payment per year during the term of
this Agreement. The bonus, if any, will be paid at the time that the
relevant 10K if filed with the SEC. The EBITDA targets described in this
Exhibit A shall be "grossed up" and analyzed as if the bonuses to be paid
to the Executives have been paid (i.e., the potential executive bonuses
shall be accrued and counted as an expense on the Company's income
statement).
Job Description
President & Chief Operating Officer, The Mayo Group Inc.
|_| President & Chief Operating Officer
|_| Reports to CEO with dotted line to the Board of Directors
|_| Direct Reports include EVPs of , Key Accounts, and Consulting Groups
|_| Other Responsibilities include:
>> Daily Management of Corporate Operations
>> Creating and maintaining Corporate Infrastructure to sustain growth
>> Dealing with Wall Street and Investment Community
>> Executive ( non-Officer) Compensation Plans
>> Quarterly Customer Reviews with EVP of Business Development
>> Customer Service and Support Programs
>> National and International Corporate Expansion, working closely with
Exec Team on providing the infrastructure and funding
>> Company finances in conjunction
