ACCELERIZE NEW MEDIA, INC. Columbia Falls, MT 59912
Exhibit
10.3
EXECUTION
COPY
ACCELERIZE
NEW MEDIA, INC.
0000
Xxxxx Xxxx
Xxxxxxxx
Xxxxx, XX 00000
Xx.
Xxxxx
Xxxxxxxx
AGREEMENT
entered into as of the 1st day of January, 2007, by and between Accelerize
New
Media, Inc., a Delaware
corporation with headquarters at 0000
XXX
00 Xxxxx, Xxxxx 000, Xxxxxxxxx, XX 00000
(the
“Company”),
and
Xxxxx Xxxxxxxx, a natural person, residing at 0000 Xxxxxx Xxxxxx, Xxxx Xxxxxxxx,
XX 00000 (the “Employee”).
The
following sets out the terms of your employment with the Company, effective
as
of January 1, 2007.
1. Term.
The
Company shall employ you subject to the terms and conditions of this letter
through the earlier of January 1, 2010 or such date as this Agreement shall
terminate or expire as provided herein (the “Term”);
provided that
you
shall have the option to renew for an additional 2 year term by giving written
notice to the Company of your intention to do so 60 days before the expiration
of the Term. If this option is exercised the word “Term” shall include such
additional 2 year period. You and the Company may also elect to continue your
employment after expiration of the Term or the renewal period on such terms
and
conditions of employment as are mutually agreed upon; provided
further
that
Section 8 of this Agreement shall continue in full force and effect during
any
period in which you are employed by the Company, including without limitation,
any period of employment following the Term and shall survive the termination
of
your employment.
2. Duties.
You
shall be employed in the position of
Chief
Technical Officer. You will also serve as a Board Member on the Board of
Directors. You shall (a) be responsible, subject to the board of directors
of
the Company (the “Board”)
and
the President of the Company, for participating in the management and direction
of the Company, (b) perform all duties incident to such offices and (c) perform
such other tasks, consistent with your position with the Company, as may from
time to time be assigned to you by the Board or other officers of the Company.
You shall devote substantially all of your business time, labor, skill, and
best
ability to the performance of your duties hereunder in a manner which will
faithfully and diligently further the business and interests of the Company.
During the term of your employment, you shall not directly or indirectly pursue
any other business activity which unreasonably interferes with the performance
of your duties and responsibilities hereunder; provided,
however,
that
you may serve on civic or other charitable boards or committees and manage
personal investments, so long as such activities do not interfere in any
material respect with the performance of your duties and responsibilities
hereunder.
3. Compensation.
Base
Salary.
During
the Term you shall receive an annual base salary (the “Annual
Base Salary”)
of One
Hundred Fifty Thousand Dollars ($150,000) for your position as Chief Technical
Officer of the Company. The Annual Base Salary shall be payable in accordance
with the Company’s payroll practices as in effect from time to time, subject to
applicable withholding and other taxes.
4. Additional
Benefits.
(a) Business
Expenses.
The
Company shall reimburse you for reasonable and properly documented business
expenses incurred by you in connection with your employment by the Company,
including but not limited to your monthly cell phone charges for business
related calls and emails in accordance with Company policy.
(b) Benefit
Plans and Programs.
During
the Term, the
Company shall reimburse you for your health insurance premiums as and to the
extent set forth on Exhibit
A.
(c) Stock
Option Plan.
You
shall, to the extent you are otherwise eligible, be entitled to participate
in
the Company’s stock option plan; provided that any grant of options shall be
subject to vesting and other terms and conditions as may be determined by the
Board of Directors of the Company. Upon execution of this agreement, you shall
be granted a non-qualified stock option (an “NSO”)
to
purchase 200,000 shares of the Company’s common stock subject to the terms and
conditions of the option agreement between the Company and you relating to
such
option of even date herewith (the “NSO
Agreement”).
5. Illness
or Disability.
If,
because of your illness or other disability for a continuous period of more
than
45
days,
you are unable to render the services required by the Company as provided
herein, the Company may end the Term and the Company may terminate your
employment hereunder, by written notice. Upon such termination, if any, you
shall not be entitled to any further payments of any nature, except for payment
of (a) any
earned but unpaid Annual Base Salary and
(b)
unreimbursed business expenses (collectively, “Payable
Amounts”).
All
Payable Amounts shall become due and payable on the date of such
termination.
6. Death.
In the
event of your death, the Term shall end and the obligation of the Company to
make any payments whatsoever under this Agreement shall cease, except that
your
executors, administrators, or other legal representatives, shall be entitled
to
receive any Payable
Amounts.
7. Termination
of Employment.
(a)
Termination
Without Cause.
During
the Term, this Agreement and your employment may be terminated by either party
without Cause by giving thirty (30) days’ prior written notice of such
termination to the other party; provided,
however,
that
the Company may terminate your employment without any payment obligation
immediately after you have given written notice that you intend to terminate
this Agreement. In the event that the Company terminates your employment without
Cause during the Term, the Company shall, subject to your execution and delivery
of a general release in favor of the Company and its affiliates, and your
compliance with the terms of this Agreement, pay to you a severance payment
of
the
greater of the remaining payments due on the term of this Agreement or an
Annual
Base Salary otherwise payable through one (1) year from the date of termination,
payable in accordance with the Company’s normal payroll practices (or, at your
option, in one lump sum payment, discounted to present value using a 5% discount
rate), and notwithstanding anything to the contrary, you will be entitled to
such payments only if you have complied in full with the terms of this Agreement
following your termination (e.g.,
your
Non-Competition, Non-Solicitation, Confidentiality, and Return of Property
obligations, etc.).
In
addition, (i) you shall be entitled to receive all Payable Amounts (which shall
become due and payable on the date of termination) and (ii) all of your unvested
options issued under the Company’s Stock Option Plan, bonuses and other
compensation shall vest on the date of termination.
(b) Termination
with Cause.
During
the Term, this Agreement and your employment may be terminated by the Company
with Cause. The Company shall have no liability for any further payments to
you
(including, without limitation, Annual Base Salary or benefits) upon your
termination
for
Cause, provided that you shall be entitled to receive all Payable Amounts (which
shall become due and payable on the date of termination).
“Cause”
shall
mean your:
|
(i)
|
failure
or refusal to perform, or any misconduct in the performance of, any
material portion of your obligations, duties and responsibilities
under
this Agreement, which (A) is incapable of cure or (B) has not been
cured
or remedied as promptly as is reasonably possible (and in any event
within
forty-five (45) days) after written notice from the Company to you
specifying in reasonable detail the nature of such failure, refusal
or
misconduct; or
|
|
(ii)
|
material
breach of this Agreement which (A) is incapable of cure, or (B) has
not
been cured or remedied promptly (and in any event within forty-five
(45)
days) after written notice from the Company to you specifying in
reasonable detail the nature of such breach;
or
|
|
(iii)
|
act
or acts of dishonesty in connection with your employment;
or
|
| (iv) |
commission
of a felony or other crime which materially and adversely affects
the
Company or its business or
reputation.
|
8. Restrictions.
You
acknowledge that
the
business in which the Company is engaged is highly competitive,
and
that you are a key executive of the Company. You further acknowledge that as
a
result of your senior position within the Company, you have acquired and will
acquire extensive confidential information and knowledge of the business
of the Company,
and
will develop relationships with, and/or knowledge of, customers, clients,
employees, sales agents, middlemen and suppliers of the Company and its
subsidiaries and affiliates. In light of the foregoing, you agree as
follows:
(a) Non-Solicitation.
While
you
are employed by the Company for a period of eighteen (18) months thereafter,
you
agree that you will not, either directly or indirectly, (i) attempt to recruit,
solicit or take away any employee or consultant of Company; make known to any
person, firm or corporation the names or addresses of, or any information
pertaining to any employee or consultant of Company or (ii) attempt to call
on,
solicit or take away any customer or collaborating partner of Company or any
prospective customer or collaborating partner whose identity as such was learned
by you during your employment with the Company.
(b) Non-Competition.
While
you
are employed by the Company and for and for a period of eighteen (18) months
thereafter, (i) you will not directly or indirectly be interested in, as an
owner, partner, member or shareholder of any entity, which engages in activities
related to debt reduction, financial website portals or any other activity
that
is specific to the business of the Company and its affiliates from time to
time
(“Proscribed
Activity”)
provided,
however,
that
you and members of your family may acquire (or hold) solely for investment
purposes up to 5% of the outstanding equity interests in any publicly-traded
company; and (ii) you will not, directly or indirectly as an employee, officer,
director, partner, joint venturer, consultant or otherwise engage in any
Proscribed Activity or participate, consult with, render services to or permit
your name to be used or any other manner or capacity engage in any business
or
enterprise which engages in Proscribed Activity.
(c) No
Recruiting.
While
you are employed by the Company and for a period of eighteen (18) months
thereafter, you will not, directly or indirectly, on your own behalf or as
an
owner, partner, officer, director, employee or consultant of any entity, hire
or
offer to hire any person who is or was an employee or contractor or
collaborating partner of the Company during your employment with the Company.
Notwithstanding anything to the contrary, if during the period this provision
is
effective, you and Xxx Xxxxxxxx are both no longer employed by or providing
services to the Company, you may collaborate on other business endeavors which
do not compete with the Company’s business.
(d) Confidentiality.
(i)
You
agree at all times during your employment with the Company and thereafter to
hold in strictest confidence, and not to use, except for the benefit of the
Company and within the scope of your employment, or to disclose (except as
required by law) to any person or entity, any Confidential Information of the
Company. You understand that “Confidential
Information”
means
(i) any and all information,
in
whatever form, whether reduced to writing, maintained on any form of electronic
media, or maintained in mind or memory, received
by you or generated by you on behalf of the Company at any time before or after
the date of this Agreement relating
to the current or prospective business, research and development activities,
products, technology, strategy, organization and/or finances of the Company,
or
of third parties (including affiliates, vendors, suppliers and customers) with
which the Company has a business relationship and (ii) any other information,
in
whatever form, designated by the Company as confidential, in either of cases
(i)
or (ii), above, whether disclosed to, or obtained by, you prior or subsequent
to
the date of execution of this Agreement. Confidential Information shall
include
without limitation customer lists, database information, samples, demonstration
models or materials and other embodiments of products or prospective products,
software and other technology, projections, existing and proposed projects
or
experiments, processes and methodologies and trade secrets and all Developments,
as defined below, but excluding (A) information that the Company deliberately
and voluntarily makes publicly available and (B) information
disclosed by you to comply with a court, or other lawful compulsory, order
compelling you to do so, provided you give the Company prompt notice of the
receipt of such order and disclosure is limited only to disclosure necessary
for
such purpose. You
specifically acknowledge that the Confidential Information derives independent
economic value from not being readily known to, or ascertainable by proper
means
by, others; that the Company has expended considerable sums and efforts to
develop such Confidential Information; reasonable efforts have been made by
the
Company to maintain the secrecy of such information; that such information
is
the sole property of the Company or its affiliates, vendors, suppliers, or
customers and that any retention, use or disclosure of such Confidential
Information by you during the Term (except in the course of performing your
duties under this Agreement) or any time after termination thereof for any
reason, shall constitute a violation of this Agreement and the misappropriation
of the trade secrets and Confidential Information of the Company or its
affiliates, vendors, suppliers, or customers.
(ii)
You
recognize that the Company has received and in the future will receive
Confidential Information of and from other companies subject to a duty on the
Company’s part to maintain the confidentiality of such information and to use it
only for certain limited purposes. You agree to hold all such confidential
or
proprietary information in the strictest confidence and not to disclose it
to
any person or entity or to use it except as necessary in performing your duties
under this Agreement.
(iii)
You
agree that all Confidential Information, in any form, shall be and remain the
sole and exclusive property of the Company and that immediately upon the
termination of your employment, or at any other time that the Company may
request, you shall deliver all Confidential Information in your control to
the
Company or, if instructed to do so by the Company, you will delete or destroy
all Confidential Information in your control.
(e) Assignment
of Work Product.
(i)
If
at any
time during your employment with the Company, you have or shall (either alone
or
with others, and whether before or after the date of this Agreement) make,
conceive, create, discover, invent or reduce to practice any invention, design,
development, improvement, process, software program, work of authorship, or
technique, in
whole
or in part, or which results from any work which you may do for or at the
request of the Company, whether or not conceived by you while on holiday, on
vacation, or off the premises of the Company, including such of the foregoing
items conceived during the course of employment which are developed or perfected
after your termination date,
whether
or not patentable or registrable under copyright or similar statutes (herein
called “Developments”)
that
(a) relates to the business of the Company or any of the products or services
being developed, manufactured or sold by the Company, or (b) results directly
or
indirectly from tasks assigned to you by the Company or (c) results from the
use
of premises or property (whether tangible or intangible) owned, leased or
contracted for by the Company, such Developments and all rights and interests
therein and all records relating to such Developments shall be the sole and
absolute property of the Company. You shall promptly disclose to the Company
each such Development and you shall deliver to the Company all records relating
to each such Development. You hereby assign any rights (including, but not
limited to, any rights under patent law and copyright law or other similar
laws)
you may have or acquire in the Developments to the Company, without further
compensation. Where applicable, all Developments which are copyrightable works
shall be works made for hire. To
the
extent any such work of authorship may not be deemed to be a work made for
hire,
you agree to, and do hereby, irrevocably, perpetually and unconditionally
transfer and assign to the Company all right, title, and interest including
copyright in and to such work without further compensation.
(ii)
You
will, during your employment with the Company and at any time thereafter, at
the
request and cost of the Company, promptly sign all such assignments,
applications and other documents, and take such other actions, as the Company
and its duly authorized agents may reasonably require: (A) to evidence the
Company’s ownership of any Development and to apply for, obtain, register and
vest in the name of the Company, or renew, patents, copyrights, trademarks
or
other similar protection for any Development in any country throughout the
world
and (B) to initiate or defend any judicial, administrative or other proceedings
in respect of such patents, copyrights, trademarks or other similar
rights.
(iii)
In
the event the Company is unable, after reasonable effort, to secure your
signature for such purposes for any reason whatsoever, you hereby irrevocably
designate and appoint the Company and its duly authorized officers and agents
as
your agents and attorneys-in-fact, to act for and in your name, behalf and
xxxxx, to execute and file any such assignments, applications or other documents
and to do all other lawfully permitted acts to further the obtaining and
protection of such patents, copyright or trademark registrations or other rights
with the same legal force and effect as if executed by you.
(iv) You
represent and warrant that (A) you do not
have
any pre-existing inventions that relate to the business of the Company and
all
inventions that you have made and own the intellectual property rights to as
of
the Effective Date that relate to the business of the Company shall be
considered Developments and are subject to the terms of Section 8(d) and
(B)
all
Developments that you have developed or with respect to which you have been
associated while employed by the Company are the sole property of the Company
and that there are no other claims or ownership rights in such property with
respect to any other party.
(f) Return
of Property.
Upon
the termination of the your employment or at any other time upon written request
by the Company, you shall promptly deliver to the Company all records, files,
memoranda, designs, data, reports, drawings, plans, computer programs, software
and other documents (and all copies or reproductions for such materials in
your
possession or control) belonging to the Company, including, without limitation,
and Developments and/or Confidential Information and anything relating
thereto.
(g) For
the
purposes of this Section
8,
“Company”
shall
mean the Company and its subsidiaries and controlled affiliates.
9.
General.
(a) Cooperation.
During
the Term and thereafter, you agree to fully cooperate with the Company or its
counsel in connection with any matter, investigation, proceeding or litigation
regarding any matter in which you were involved during your employment with
the
Company or to which you had knowledge based on your employment with the
Company.
(b) Notices.
Any
notice or any other communication required or permitted to be given hereunder
shall be in writing and shall be sufficiently given (i) when delivered by
personal delivery; or (ii) two days after sending by registered mail,
postage prepaid, return receipt requested, to
the
party entitled thereto at the address stated below.
| (A) |
To
Company:
|
0000
XXX
00 Xxxxx
Xxxxx
000
Xxxxxxxxx,
XX 00000
Attn:
Xxxxx Xxxx
| (B) |
To
Xxxxx Xxxxxxxx:
|
0000
Xxxxxx Xxxxxx
Xxxx
Xxxxxxxx, XX 00000
(c) No
Conflict.
you
represent that your performance of all of the terms of this Agreement does
not
and will not conflict with or breach any agreement you have with any other
party.
(d) Waivers.
Any
waiver by the Company of any provision of this Agreement shall not operate
or be
construed as a waiver of this Agreement or of any subsequent breach of such
provision or any other provision.
(e) Survival
of Terms.
Your
obligations under Sections 8 and 10 of this Agreement shall survive the
termination of this Agreement for any reason whatsoever regardless of the manner
of such termination and shall be binding upon your heirs, executors,
administrators and legal representatives.
(f) Successors
and Assigns.
This
Agreement shall inure to the benefit of and be enforceable by the Company’s
successors or assigns. The
Company shall have the right to assign this Agreement.
(g) Scope
of Restrictions.
You
agree
that the unenforceability of any one clause of this Agreement shall in no way
impair the enforceability of any of the other clauses. If any of the provisions
of this Agreement shall for any reason be held to be excessively broad as to
scope, activity, subject or otherwise, the parties hereto agree that such
provisions shall be construed by the appropriate judicial body by limiting
or
reducing them, so as to be enforceable to the maximum extent legally
permissible.
(h) Remedies.
You
agree that a any breach or threatened breach of Section 8
of this
agreement would result in irreparable harm to the Company; therefore, in
addition to its other remedies at law or in equity, the Company shall be
entitled to injunctive or other equitable relief in order to enforce or prevent
any violations of the provisions of Section 8,
without
the posting of any bond.
(i) Governing
Law.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of Delaware without regard to its conflict of law provisions.
(j) Dispute
Resolution
(i)
Hierarchy
of Dispute Resolution Procedures.
Any
dispute, controversy, or claim, whether based on contract, tort, statute, fraud,
misrepresentations, or any other legal theory between the Company, on the one
hand, and you, on the other hand (a “Dispute”),
that
arises out of or relates to this Agreement or any obligations or related
services to be provided under this Agreement, shall be resolved in accordance
with the procedures described in this Section 9(j). In the case of a Dispute,
the parties shall establish an internal hierarchy to facilitate resolution
of
any Dispute as set forth below:
(A)
Upon
written request of the Company or you , the Company shall appoint one designated
representative and you shall either represent yourself or appoint one designated
representative whose task it shall be to meet for the purpose of endeavoring
to
resolve such Dispute. Before any initial meeting, the designated representative
shall provide to each party written notice of any Dispute, which notice shall
include a detailed description of the claim or dispute sufficient to allow
a
full analysis and complete response. Each party shall exercise good faith in
providing its response to any claim or dispute, in advance of the first meeting
between designated representatives. The designated representatives shall meet
as
often as the parties reasonably deem necessary to discuss the Dispute in an
effort to resolve the Dispute without the necessity of any further
proceeding.
(B)
The
Company and you shall negotiate in good faith in an attempt to resolve the
Dispute for a period of not greater than sixty (60) days after notice of the
Dispute is received by the parties.
(ii)
Arbitration
(A)
If
the parties are unable to resolve any Dispute as contemplated by Section
9(j)(i), such Dispute, excluding any matter relating to questions of
arbitrability and any action for injunctive relief or specific performance,
shall be submitted to arbitration.
(B)
Any
arbitration hereunder shall be conducted as a self administered arbitration
in
accordance with and subject to the Federal Arbitration Act (9 U.S.C. § 1 et
seq., the “Arbitration
Act”)
to the
exclusion of any state arbitration laws, and to the extent not inconsistent
with
the Arbitration Act, in accordance with the commercial arbitration rules of
the
American Arbitration Association, as then in effect (the “Arbitration
Rules”).
The
arbitration shall occur in New York, NY.
(C)
The
arbitration panel shall consist of one (1) arbitrator, chosen by mutual
agreement of the parties. The arbitrator shall be a lawyer, judge or mediator
experienced in the resolution of commercial disputes. The relevant parties
shall
cooperate to select the arbitrator promptly after service of a document
initiating arbitration.
(D)
The
award of an arbitrator shall be final and binding upon the parties to such
arbitration proceeding, with only such rights of appeal or review as are
available under the Arbitration Act.
(E)
Except for the matters specifically addressed in the Arbitration Rules or
hereafter in this Section 9(j)(ii) the procedural rules for the conduct of
an
arbitration under this Section 9(j)(ii) shall be established by the arbitrator
consistent with the parties' intent that any arbitration hereunder is to be
conducted in a streamlined and expedited manner, with limited discovery, and
as
economically as practicable. In addition, the following shall
apply:
(1)
All
costs
and fees of counsel and expert witnesses shall be borne by the party incurring
the same; and
(2)
The
costs
of the arbitrator shall be divided equally among the parties to any arbitration
proceeding.
(k) Entire
Agreement; Amendment.
This
Agreement constitutes the entire agreement between the Company and you with
respect to the subject matter hereof (except with respect to the NSO), and
supersedes all prior discussions, promises, negotiations and agreements (whether
written or oral). The parties agree that the NSO Agreement governs the terms
of
the NSO and if any provision of this Agreement conflict with the terms of the
NSO Agreement, the terms of the NSO Agreement shall govern. This
Agreement may be amended or modified only by a written agreement executed by
the
Company and you.
(l) Tax
Withholding.
The
Company may withhold from any amounts payable under this Agreement or otherwise
all federal, state, city, or other taxes as may be required pursuant to any
law
or governmental regulation or ruling.
(m) Option
Award.
During
the Term or any extension thereof pursuant to Section 1, you shall have the
right to require the Company to amend the non-qualified stock option issued
by
the Company to you of even date herewith to so it mirrors any option granted
to
Xxxxx Xxxx after the date hereof in all material terms except for the number
of
options granted.
[SIGNATURE
PAGE FOLLOWS]
IN
WITNESS WHEREOF, the parties hereto have executed or caused to be executed
this
Agreement as of the date first above written.
EMPLOYEE:
/s/
Xxxxx
Xxxxxxxx
Xxxxx
Xxxxxxxx
ACCELERIZE
NEW MEDIA, INC.
BY:
/s/ Xxxxx Xxxx
Xxxxx
Xxxx
Title:
Chief Executive Officer
Exhibit
A
[insert
description of BCBS plan or attach copy of a xxxx with relevant
information]
