Exhibit 10.3
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is made and entered into
effective as of the 1st day of December, 1999, by and between NetZero, Inc., a
Delaware corporation (the "Company"), with principal corporate offices at ▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, and ▇▇▇▇▇ ▇▇▇▇▇, whose address is
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ("Employee").
1. EMPLOYMENT.
1.1 The Company hereby agrees to employ Employee, and Employee hereby
accepts such employment, on the terms and conditions set forth herein,
commencing December 1, 1999 (or, if later, the date the Conditions, as
defined below are fulfilled) (the "Effective Date"), and continuing
through December 1, 2002 (the "Term"), unless such employment is
terminated earlier as provided in Section 4 below.
1.2 Employee's employment shall be contingent upon (i) the approval by the
Company's Board of Directors of this Agreement and (ii) the
consummation of the acquisition of AimTV, Inc. by the Company pursuant
to the Merger Agreement and Plan of Reorganization dated November 15,
1999 (collectively, the "Conditions"). If the Conditions are not met
by December 15, 1999, this Agreement shall terminate and be of no
force or effect.
2. DUTIES OF EMPLOYEE.
2.1 Employee shall serve as Senior Vice President, Chief Marketing Officer
of the Company. In this capacity, Employee shall perform customary,
appropriate and reasonable duties including such duties as are
delegated to him from time to time by the Chief Executive Officer or
the Board of Directors of the Company (the "Board"). Employee shall
report directly to the Company's Chief Executive Officer.
2.2 Employee agrees to devote Employee's full time, attention, skill and
efforts to the performance of his duties for the Company during the
Term; provided, however, that the Company acknowledges that Employee
has certain responsibilities to, and involvement in and with, the
following entities and the Company agrees that Employee may fulfill
such responsibilities and continue such involvement without in any way
jeopardizing or otherwise affecting his employment by the Company or
any of his rights hereunder so long as such involvement does not
materially interfere with Employee's duties hereunder.
(a) WHITE BONE ENTERTAINMENT LLC, its affiliates and their respective
successors and assigns. Employee has a non-employee ownership
interest in, and is a member of, White Bone Entertainment
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LLC. White Bone's principal business is the development,
production, financing, distribution and exploitation of motion
pictures, television programs and related activities.
(b) RETAIL MEDIA SYSTEMS. Employee serves on the board of directors
of Retail Media Systems.
In addition, this Agreement shall not be interpreted to
prohibit Employee from making passive personal investments or
engaging in charitable and public service activities to the
extent such activities do not materially interfere with
Employee's duties hereunder.
3. COMPENSATION AND OTHER BENEFITS.
3.1 BASE SALARY. During the Term, the Company shall pay to Employee a base
salary of One Hundred Fifty Thousand Dollars ($150,000) per year (the
"Base Salary"), payable at the rate of Twelve Thousand Five Hundred
Dollars ($12,500.00) per month, with payments to be made in accordance
with the Company's standard payment policy and subject to such
withholding as may be required by law.
3.2 BONUS. During the Term, the Employee shall also be eligible to receive
an annual cash bonus at the same time as other Senior Vice Presidents
of up to 70% of Employee's base salary for each full fiscal year or a
pro rata amount for a partial fiscal year (the "Annual Bonus"), less
withholding required by law, based on performance criteria established
by the Board or the Company's Chief Executive Officer. Employee shall
not be eligible to receive any unpaid Annual Bonus if his employment
hereunder is terminated pursuant to either Section 4.1, or if Employee
voluntarily resigns.
3.3 VACATION. Employee shall be entitled initially to four (4) weeks paid
vacation with increases in accordance with the Company's standard
vacation policies.
3.4 OTHER BENEFITS. Employee shall be eligible to participate, as of the
date of Employee's employment, in all group life, health, medical,
dental or disability insurance or other employee, health and welfare
benefits made available generally to other senior executives of the
Company on the same terms as such senior executives. If Employee
elects to participate in any of such plans, Employee's portion of the
premium(s) will be deducted from Employee's paycheck.
3.5 BUSINESS EXPENSES. The Company shall promptly reimburse Employee for
all reasonable and necessary business expenses incurred by Employee in
connection with the business of the Company and the performance of his
duties under this Agreement, subject to Employee providing the Company
with reasonable documentation thereof.
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3.6 OPTION GRANT. Effective on the date Employee commences employment with
the Company, Employee shall be granted a stock option under the
Company's 1999 Stock Incentive Plan for 327,273 shares of the
Company's Common Stock. The option shall have an exercise price equal
to the closing per share of Common Stock as reported on the Nasdaq
National Market on the date Employee commences employment. Employee
shall acquire a vested interest in twenty-five percent of the Option
shares upon the first-year anniversary of the commencement of
Employee's employment with the Company and in the remaining
seventy-five percent of the Option shares in thirty-six (36) equal
monthly installments, beginning one month following such first-year
anniversary.
4. TERMINATION.
4.1 TERMINATION FOR CAUSE.
(a) Termination "for cause" is defined as follows: the Company
terminates Employee's employment with the Company (1) if Employee
is convicted of a felony or commits an act of moral turpitude, in
either case which adversely impacts the Company, (2) if Employee
materially breaches the Company's Confidentiality and Proprietary
Agreement, or (3) if Employee fails, after receipt of detailed
written notice and after receiving a period of at least thirty
(30) days following such notice to cure such failure, to use his
reasonable good faith efforts to follow the direction of the
Company's Board of Directors and to perform his obligations
hereunder.
(b) The Company may terminate this Agreement for any of the reasons
stated in Section 4.1(a) by giving written notice to Employee
without prejudice to any other remedy to which the Company may be
entitled. The notice of termination shall specify in reasonable
detail the grounds for termination. If Employee's employment
hereunder is terminated "for cause" pursuant to this Section 4.1,
Employee shall be entitled to receive hereunder his accrued but
unpaid Base Salary and vacation pay through the date of
termination, and reimbursement for any expenses as set forth in
Section 3.5, through the date of termination, but shall not be
entitled to receive any unpaid portion of the Annual Bonus or any
other amount.
4.2 TERMINATION WITHOUT CAUSE. If Employee's employment is terminated
without "cause" as defined in Section 4.1(a), or if Employee is
Involuntarily Terminated (as defined below), the Company (or its
successor, as the case may be) shall pay to Employee (i) any accrued
but unpaid Base Salary and vacation through the date of termination,
(ii) reimbursement for any expenses as set forth in Section 3.5,
through the date of termination and (iii) a severance payment in an
amount equal to One Hundred Fifty Thousand Dollars ($150,000.00),
payable in one lump sum, subject to withholding as may be required by
law.
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As used in this Section 4.2, Employee shall be deemed "Involuntarily
Terminated" if (i) the Company or any successor to the Company
terminates Employee's employment without cause in connection with or
following a Corporate Transaction (as defined in the Company's 1999
Stock Incentive Plan); or (ii) in connection with or following a
Corporate Transaction there is (a) a material reduction in the scope
Employee's day to day responsibilities, (b) a decrease in pay from
that provided by the Company immediately prior to the Corporate
Transaction or (c) a relocation of Employee's place of employment by
more than fifty miles, provided and only if such change, reduction or
relocation is effected without Employee's consent.
5. ASSIGNMENT. Neither the Company nor Employee may assign this Agreement
or any rights or obligations hereunder. This Agreement will be binding
upon the Company and its successors and assigns. In the event of a
Corporate Transaction, the Company shall cause this Agreement to be
assumed by the Company's successor as well as any acquiring or
ultimate parent entity, if any, following any Corporate Transaction.
6. MISCELLANEOUS.
6.1 This Agreement supersedes any and all other agreements, either
oral or in writing, between the parties hereto with respect to
the employment of Employee by the Company, other than the
Confidentiality and Proprietary Agreement attached hereto as
Exhibit A, and constitutes the entire agreement between the
Company and the Employee with respect to its subject matter. In
addition, that certain Stock Restriction Agreement and that
certain Noncompetition Agreement shall remain unaffected by this
Agreement. That certain Employment Agreement between AimTV, Inc.
and Employee dated June 1, 1999 is hereby terminated and of no
further force or effect.
6.2 This Agreement may not be amended, supplemented, modified or
extended, except by written agreement, which expressly refers to
this Agreement, which is signed by each of the parties hereto and
which is authorized by the Company's Board of Directors.
6.3 This Agreement is made in and shall be governed by the laws of
California, without giving effect to its conflicts-of-law
principles.
6.4 In the event that any provision of this Agreement is determined
to be illegal, invalid or void for any reason, the remaining
provisions hereof shall continue in full force and effect.
6.5 Employee represents and warrants to the Company that there is no
restriction or limitation, by reason of any agreement or
otherwise, upon Employee's right or ability to enter into this
Agreement and fulfill his obligations under this Agreement.
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6.6 All notices and other communications required or permitted
hereunder shall be in writing and shall be mailed by first-class
mail, postage prepaid, registered or certified, or delivered
either by hand, by messenger or by overnight courier service, and
addressed to the receiving party at the respective address set
forth in the heading of this Agreement, or at such other address
as such party shall have furnished to the other party in
accordance with this Section 6.6 prior to the giving of such
notice or other communication.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the first date written above.
NETZERO, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
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▇▇▇▇ ▇▇▇▇▇▇▇▇, Chief Executive Officer
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
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