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EXHIBIT 10.15
EMPLOYMENT AGREEMENT
BETWEEN
MICRO-MEDIA SOLUTIONS, INC.
AND
XXXX XXXXXX
THIS AGREEMENT dated June 15, 1997 (hereinafter called the ("Agreement") by and
among MICRO-MEDIA SOLUTIONS, INC., a Utah corporation and Xxxx Xxxxxx (the
"Executive")
WITNESSED THAT:
WHEREAS, Xxxx Xxxxxx has this date acquired 7,125,000 shares of the capital
stock of MSI and
WHEREAS, the Executive founded Micro-Media Solutions, Inc. of Texas (MSI) and
has served as an executive officer of MSI for the past five (5) years and is
familiar with the operations and business of MSI, and has over 20 years of
related experience.
WHEREAS, MSI desires to secure the services of the Executive in the continued
conduct of the operations and business of MSI, and
WHEREAS, the Executive desires to be employed in the continued conduct of the
operations and businesses of MSI and
WHEREAS, MSI is a public traded company based in Austin, Texas and a wholly
owned subsidiary of MSI Utah. The corporation was formed to provide computer
hardware, software programming, system support, maintenance, media duplication,
kitting, and related services to the public and private sectors. MSI is a
minority owned business that is HUB certified to du business with state and
corporate clients. The principals in the firm have significant computer related
experience and it is imperative that the MBE/HUB status be maintained as long as
possible.
At the date of the public company transaction the Hispanic makeup working in the
company controlled 71% of the company ownership with the Executive owning 66%.
Now, therefore the Executive will receive a matching stock % of new stock. To
remain in control of MSI (51.5%) until MSI's graduation from HUB status.
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NOW, THEREFORE, in consideration of the premises and of the mutual covenants and
agreements contained herein, the parties hereto, intending to be legally bound,
agree as follows:
ARTICLE 1
EMPLOYMENT
Section 1.01. Employment. MSI shall employ the Executive, and the Executive
shall serve MSI, in an executive capacity in accordance with the terms and
conditions hereof.
Section 1.02. Employment Period. The Executive shall be employed from June 23,
1997 hereof through March 31, 2001 inclusive, subject, however, to prior
termination as hereinafter provided in Article II hereof (such period of
employment being hereinafter called the "Employment Period"). In addition, the
employment period will cover two (2) one year employment extension options to be
mutually agreed between:
Section 1.03. Duties. Commencing with the beginning of the Employment Period,
the Executive shall perform the duties of President/CEO of MSI, as such duties
are set forth in the By-Laws of MSI subject always to the direction and control
of the Board of Directors of MSI Texas and Utah. The Executive shall devote his
entire working time and attention to and will use his best energies and
abilities in the performance of such duties to the reasonable satisfaction of
MSI. Such duties shall be performed at 000 Xxxxxx Xxxxxx, Xxxxxx, Xxxxx subject
to travel to such place or places as the interest, needs, business, or
opportunities of MSI shall require.
Section 1.04 Conflicting Activities. During the Employment Period the Executive
shall not engage in any other business activity which might interfere with the
devotion of his entire working time to serving MSI and performing his assigned
duties.
Section 1.06. Compensation. During the Employment Period, the Executive shall
receive as compensation for his services an annual salary of not less than
$100,000.00 per annum. MSI shall reimburse the Executive for all reasonable
out-of pocket expenses incurred in the lawful ordinary course of his employment
which are properly reported to MSI in accordance with its accounting procedures.
At the end of fiscal year, the Executive will be granted a five year option to
purchase up to 100,000 shares of common stock at a price of $1.50 per share
exerciseable for a period of 5 years commencing July 1 of each year.
Section 1.07. Employee Benefits. During the Employment
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Period, the Executive shall be eligible to participate in all of MSI employee
welfare, benefit and vacation plans and arrangements in accordance with their
terms as in effect from time to time which are applicable to employees of MSI
similarly situated. The Executive will be required to take at least 3 weeks of
vacation each calendar year.
Section 1.08. Bonus. During the Employment Period, the Executive shall have the
right to a Bonus, at the discretion of the Board of Directors. The Bonus will
consist of cash and common stock and will be based upon performance, revenues,
and common stock value. The base for the calculation of the bonus at the end of
each fiscal year will be as follows:
Revenue $10,000,000
Common Stock Value $3.00
For each ten percent increase in revenues from year to year (base year revenue
1998), the Executive will be issued 100,000 shares of common stock at 50% the
then current market value, not to exceed $1.70 per share.
For each $1.00 increase in the common stock value above the base common stock
value (highest previous level), calculated on the last 90 day average, the
Executive will be paid a cash bonus of $100,000 due no later than June 30, of
each fiscal year.
Section 1.09. Automobile. During the Employment Period the Executive shall be
provided an automobile allowance up to $650.00 per month for an automobile to be
used in business use.
ARTICLE II
TERMINATION
Section 2.01. Death and Incapacity. If the Executive dies during the Employment
Period, his employment hereunder shall immediately terminate. If during the
Employment Period the Executive shall become unable to continue to perform his
duties hereunder because of physical or mental incapacity or disability of a
nature reasonably expected to continue for more than three years, then MSI may
terminate his employment hereunder by delivery of written notice to the
Executive, which notice shall specify the date of termination, which date shall
be not sooner than 30 days after the date of such notice. Any such physical or
mental incapacity or disability shall be conclusively established by a
certificate to such effect by a medical doctor, as selected by MSI. Executive
shall make himself reasonably available for an examination by such medical
doctor; provided that if Executive is not so available, then MSI's reasonable
determination of such a physical or mental incapacity or disability shall be
conclusive.
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Section 2.02. For Cause. If during the Employment Period the Executive shall in
a material respect (a) continue to fail to perform his duties hereunder or under
law or (b) continue to violate any agreement, covenant, term or condition
hereunder after delivery of written notice from MSI of such failure or violation
providing 30 days to correct such failure or violation (if correctable), or if
during the Employment Period, MSI acting in good faith and upon reasonable
grounds, determines that the Executive has engaged in gross misconduct which has
severely injured the business or reputation of MSI or otherwise materially and
adversely affected either of its interests or which might so injure either of
its business or reputation or so affect either of its interests if the Executive
were retained then, and in any such event MSI may, by delivery of written notice
to the Executive, terminate his employment hereunder at any date specified in
such notice. Section 2.03. Effect. Upon termination hereunder together with the
payment of any salary accrued under Section 1.06 hereof, Executive's employment
and all obligations of MSI under Sections 1.01, 1.06, 1.07 and 1.08 hereof shall
forthwith terminate. The obligations of the Executive and MSI set forth in
Article III hereof shall continue notwithstanding the termination of the
Executive's employment pursuant to Article II hereof.
ARTICLE III
THE EXECUTIVE'S COVENANTS
Section 3.01. Confidentiality. Recognizing (1) that unpublished patentable or
unpatentable data and technical or nontechnical information in any way related
to the business of MSI or its affiliates (the term "affiliates" as used in this
Article III and Section 4.03 hereof, shall include all parties controlling,
controlled by or under common control with MSI, such as, but not limited to:
designs, procedures, processes, formulae, trademarks, patents, copyrights,
software, projects, project costs, financial or pricing data, marketing plans,
customer and supplier lists or business projections (including but not limited
to such of the foregoing used in the business of MSI constitute valuable trade
secrets or confidential information (such data and information being hereinafter
collectively called "Confidential Information") and (2) that such Confidential
Information is the property of MSI or its affiliates, in consideration of the
Executive's access to and use of Confidential Information, the Executive
covenants to hold such Confidential Information in trust for MSI and its
affiliates, and covenants not disclose or use the same other than in the
business of MSI. Without limitation on the foregoing the Executive shall:
(a) not directly or indirectly, disclose or make available to anyone or use
outside of his employment with MSI any Confidential Information
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without the prior written consent of MSI.
(b) safeguard all Confidential Information in his possession at all times so
that access to it is not allowed to any unauthorized person, corporation or
entity (including unauthorized employees and agents of MSI or its affiliates):
(c) promptly disclose to MSI and its affiliates all matters coming to his
attention during his employment pertaining to the business or interests of MSI
and its affiliates and all ideas which he may conceive and all inventions,
improvements or discoveries which he may make and which may relate to the
business or interests of MSI and its affiliates, whether conceived or made
during working hours or otherwise and whether alone or jointly with others, and
disclaim all rights, title and interest in and to all such ideas, inventions,
improvements or discoveries recognizing them to be the sole property of MSI and
its affiliates; and
(d) deliver to MSI and its affiliates, promptly upon termination of his
employment, papers, photographs, photo reproductions, computer tapes, tape
recordings and other documents and materials containing any Confidential
Information, and all personal notes, reports, plans, drawings and copies,
extracts and reproductions thereof, relating to the business of MSI and its
affiliates in his possession or control.
Section 3.02. Noncompetition. For the period commencing with the beginning of
the Employment Period and ending on the earlier to occur of (i) December 31,2000
or (ii) one year from the date of termination under Article II hereof
(hereinafter called the "Noncompetition Period"), the Executive shall not,
directly or indirectly, whether as principal or as agent, officer, director,
employee, consultant, or otherwise, alone or in association with any person,
corporation or other entity, own, carry on, be engaged, be concerned, take part
in, use or permit his name to be used, render services to, share in the earnings
of, or invest in the stock, bonds, or other securities of any person corporation
or other entity engaged in a business competitive to any business carried on by
MSI on the date hereof or at any time within the Employment Period in any
location serviced by MSI. Notwithstanding the preceding sentence the Executive
may invest in stock, bonds, or other securities of any corporation engaged in a
business similar to MSI (hereinafter called a "Similar Business"), without
otherwise participating in a Similar Business, if (1) such stock, bonds, or
other securities are listed on any national or regional securities exchange or
have been registered under Section 12 (g) of the Securities Exchange Act of
1934, (2) his investment does not exceed, in the case of any class of the
capital stock of any one issuer, 1% of the issued and outstanding shares, or, in
the case of other securities, 1% of the aggregate principal amount
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thereof issued and outstanding, and (3) such investment would not prevent,
directly or indirectly, the transaction of business by MSI with any prospective
customer or any state, district, territory, or possession of the United States,
or any governmental subdivision, agency or instrumentality thereof, by virtue of
any statute, law, regulation, or administrative practice.
Section 3.03. Goodwill. During the Noncompetition Period the Executive shall not
(1) take away or interfere or attempt to interfere, with any customer, trade,
business or patronage of MSI or its affiliates, or (2) interfere, or attempt to
interfere, with any officer, employee, representative or agent of MSI or its
affiliates, or induce, or attempt to induce, any of them to leave the employ of
MSI or its affiliates shareholders, whether or not initiated prior to the date
of termination of his employment.
Section 3.04. Extension of Noncompetition Period. The Noncompetition Period
referred to in Section 3.02 hereof shall be extended by the length of time
during which the Executive shall have admitted or been found by the court of
competent jurisdiction to have been in breach of the terms of the such Section.
Section 3.05. Covenants of the Essence. The covenant of the Executive set forth
in this Article III are of the essence of this Agreement; they shall be
construed as independent of any other provision in this Agreement, and the
existence of any claim cause of action of the Executive against MSI or any
affiliate whether predicated on this Agreement or otherwise, shall not
constitute a defense to enforcement by MSI of these covenants.
Section 3.06. Enforceability of Article III Covenants. The Executive understands
the nature of, and the burdens imposed by, the covenants contained in this
Article III and has consulted with his attorney in respect thereof. The
Executive agrees that such covenants are reasonable, enforceable and proper in
duration, scope and effect.
Section 3.07. Compensation for Article III Covenants. In consideration of the
Executive's covenants contained in this Article III, MSI shall pay to the
Executive on the date hereof, and the Executive by executing the Agreement
acknowledges receipt of, Five Hundred Dollars ($500.00).
ARTICLE IV
MISCELLANEOUS TERMS
Section 4.01. Integration and Modification. This Agreement contains the entire
agreement between the parties hereto with respect to the subject matter hereof
and supersedes all prior agreements and understandings, oral or
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written, between the parties hereto with respect to the subject matter hereof..
This Agreement may not be waived, changed, amended, modified or discharged
except by a written instrument signed by the party against whom enforcement of
any such waiver, change, amendment, modification or discharge is asserted.
Section 4.02. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Texas.
Section 4.03. Enforcement. The relationship contemplated by this Agreement is
unique and personal, and the covenants of the Executive made in Article III
hereof are integral to that relationship. Without limiting the remedies
available to MSI or its affiliates, the Executive acknowledges that damages at
law will be an insufficient remedy to MSI or its affiliates in the event that
the Executive violates the terms of such covenants and that MSI or its
affiliates may apply for and have injunctive relief in a court of competent
jurisdiction to restrain the breach or threatened breach of, or otherwise to
specifically enforce, such covenants. Such specific enforcement shall be
available to MSI or its affiliates in lieu of, or prior to or pending
determination in, any other proceeding.
Section 4.04. Waiver. A waiver by MSI, or the Executive of a breach of, or the
failure to enforce, any provision of this Agreement shall not operate or be
construed as a waiver of excuse of any subsequent breach.
Section 4.05. Severability. The invalidity of all or any part of any section of
this Agreement shall not render invalid the remainder of this Agreement or the
remainder of such section. If any provision of this Agreement is so broad as to
be unenforceable, it is expressly intended by the parties hereto that such
provision shall be interpreted to be as broad as is enforceable.
Section 4.06. Assignment. This Agreement, and the rights and obligations
hereunder, shall inure to the benefit of, and shall be binding upon, the parties
hereto and their respective successors, assigns and affiliates, except that
neither party hereto shall assign the rights or obligations hereunder without
the prior written consent of the other party. Notwithstanding the proceeding
sentence, subject to Section 2.03 hereof MSI may assign its rights and
obligations hereunder to any partnership or other business organization with
which MSI may merge or consolidate or to which it may transfer substantially all
its assets or with which it may otherwise enter into an acquisition or
reorganization transaction, and MSI may assign its rights and obligations
hereunder to any corporation which is a general or limited partner of MSI or is
a direct or indirect subsidiary of any such partner or any other related entity.
No such assignment shall relieve MSI of its obligations hereunder.
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Section 4.07. Notices. All notices and other communications hereunder shall be
in writing and shall be deemed to be received when delivered to the addressee or
when deposited in the mail, postage prepaid, or in the case of telegraphic
notice, when delivered to the telegraph office, charges prepaid, and addressed
as follows: '
(a) if to the Executive
Xxxx Xxxxxx
11035 Xxxxxxxxx
Xxxxxx, Xxxxx 00000
(b) Micro-Media Solutions, Inc.
000 Xxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
or to such other address as the addressee party may have previously furnished to
the other party.
Section 4.08. Counterparts, Section Headings. This Agreement may be executed in
any number of counterparts, each of which shall be deemed to be an original, but
all of which together shall constitute one and the same instrument. The section
headings of this Agreement are for convenience of reference only and shall not
affect the construction or interpretation of any of the provisions hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day and
year first above written.
Micro-Media Solutions, Inc. Xxxx Xxxxxx
/s/ Xxxxxxxx Xxxxxxxx /s/ Xxxx Xxxxxx
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Xxxxxxxx Xxxxxxxx, Vice President "Executive"
/s/ Xxxxxx Xxxxxxxx
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Xxxxxx Xxxxxxxx, Vice President
