EMPLOYMENT AGREEMENT
THIS AGREEMENT ("Agreement") is made and entered into, as of this
11thday of November 1999 ("Effective Date"), by and between Xxxxxx Xxxxxxxx an
individual resident of the Province of Ontario ("Employee"), and Internet Cable
Corporation, a Nevada corporation ("Employer") with its principal place of
business at 000 Xxxx Xxxxxx, Xxxxxx Xxxxx, Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000.
W I T N E S S E T H
WHEREAS, Employer desires to employ Employee, and Employee desires to
be employed by Employer, on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual
promises and agreements contained herein, the parties hereto, intending to be
legally bound, hereby agree as follows:
SECTION 1.EMPLOYMENT. Subject to the terms hereof, Employer hereby
employs Employee, and Employee hereby accepts such employment. Employee will
serve in the capacity of President - Cable Systems Technical Services Division
of Employer and will have duties and responsibilities customarily assigned to a
person with such title. Employee hereby agrees that, throughout his period of
employment, he shall devote his business time, attention, knowledge and skills,
diligently in the furtherance of the business of the Employer and of its
subsidiaries and affiliates, shall perform his duties consistent with his
position with Employer and shall observe and carry out such rules and
regulations, policies and directions as Employer may from time to time establish
to the extent consistent herewith. During the term of this Agreement, Employee
shall do such traveling as may be reasonably required of him in the performance
of his duties on behalf of Employer. Employee shall report directly to the Chief
Executive Officer of Employer
SECTION 2.TERM OF EMPLOYMENT.
2.1 The term of Employee's employment hereunder (the "Initial Term")
shall be from the Effective Date and expire at the earlier of (a) the third
anniversary of the date of this Agreement or (b) the occurrence of any of the
following events:
(i) The death or total disability of Employee (total disability
meaning the failure to substantially perform his normal required
services hereunder for a period of six (6) consecutive months
during any consecutive twelve (12) month period during the term
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hereof, as determined by an independent medical doctor jointly
chosen by the Employee and the Employer, by reason of mental or
physical disability; or
(ii) The termination by Employer of Employee's employment hereunder,
upon seven (7) days prior written notice to Employee, which
termination shall be for "Cause", as determined by the Board of
Directors of Employer in accordance with the terms hereof. For
purposes of this Agreement, "Cause" for termination of
Employee's employment shall exist (V) if Employee is convicted
of, pleads guilty to, or confesses to any felony or any act of
fraud, misappropriation or embezzlement with regard to Employer,
(W) if Employee has engaged in a dishonest act to the material
damage or prejudice of Employer or an affiliate of Employer, or
in conduct or activities materially damaging to the property,
business, or reputation of Employer or an affiliate of Employer,
(X) if Employee violates any of the provisions contained in
Section 4 of this Agreement, after receiving thirty (30) days
written notice from Employer specifically outlining the alleged
violations by the Employee of Section 4 hereof and Employee has
not cured the alleged violations within thirty (30) days of
receipt of written notice by the Employer; (Y) Employee
willfully breaches or habitually and recklessly neglects the
duties he is required to perform hereunder, or performs such
duties in a grossly negligent manner, after receiving thirty
(30) days written notice from Employer specifically outlining
the violations of this Section and Employee has not cured the
alleged violations of this Section within thirty (30) days of
receipt of written notice by Employer.
2.2 SUCCESSIVE TERMS. After the Initial Term, this Agreement shall
continue upon a year-to-year basis (the "Successive Terms"; together with the
Initial Term, the "Term") unless terminated by either the Employer or the
Employee upon ninety (90) days written notice to the other prior to the end of
the Initial Term or the then Successive Term.
SECTION 3.COMPENSATION.
3.1 TERM OF EMPLOYMENT. Employer will provide Employee with the
following salary, expense reimbursement and additional employee benefits during
the term of employment hereunder:
(a) SALARY. During the Initial Term, Employee will be paid a salary
(the "Salary"), that shall be no less than
two-hundred-fifty-thousand United States dollars (US$250,000.00)
per annum, less deductions and withholdings required by
applicable law. Thereafter, and during the Successive Terms,
Employee will be paid a salary of not less than
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two-hundred-fifty-thousand United States dollars (US$250,000)
(the "Successive Terms Salary") determined in good faith
negotiations between Employer and Employee. The Salary and
Successive Terms Salary shall be paid to Employee in equal
monthly installments (or on such more frequent basis as other
executives of Employer are compensated).
(B) PERFORMANCE BONUS.
(i) Subject to Employer's and Employee's discussions, Employer shall
reserve as an equity performance bonus, shares of Employer's
common stock, no par value per share (the "Shares") , which
shall be available for issuance to Employee as follows:
(1) In the event Employer's pre-tax earnings (which shall be
calculated as follows: gross revenues - cost of sales -
salary, general and administrative expenses) in Employee's
first year of employment exceed the mutually agreed upon
target, Employer shall issue to Employee a mutually agreed
upon number of Shares.
(ii) Employee shall be entitled to receive a monetary performance
bonus as follows:
(1) In the event Employer's pre-tax earnings (which shall be
calculated as follows: gross revenues - cost of sales -
salary, general and administrative expenses) in Employee's
first year of employment exceed the mutually agreed upon
target, Employer shall pay to Employee a bonus in the
amount to mutually agreed upon.
(iii) The determination of whether Employer has achieved a certain
level of pre-tax earnings in any year for the purposes of this
section shall be made by the certified public accountant
regularly retained or employed by Employer with ninety (90) days
after the end of each calendar year, and shall be conclusive on
Employer and Employee.
(iv) The parties' good faith and fair dealing is a material term of
this Agreement, particularly with regard to future negotiations
to define the performance bonuses identified in this section.
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Notwithstanding any provision to the contrary contained herein. Employee shall
not be eligible to any performance bonus for any year during which Employee is
not employed by Employer pursuant to this Agreement.
(d) VACATION. Employee shall be entitled to receive five (5) weeks
paid vacation during each year of employment upon dates to be
taken at such times and in such periods as shall not interfere
with the duties required to be rendered by Employee hereunder.
(e) EXPENSES. Employer shall reimburse Employee within thirty (30)
days of its receipt of a reimbursement report with supporting
receipts from the Employee, for all reasonable and necessary
expenses incurred by Employee in performing services hereunder,
including without limitation, all expenses of travel and living
expenses when away from home on business at the request of or in
the service of Employer; use of country club membership; and
automobile allowance.
(f) BENEFIT PLANS. Employee shall have the option of participating
in such medical, dental, disability, hospitalization, life
insurance, stock option and other benefit plans (such as pension
and profit sharing plans) as Employer maintains from time to
time for the benefit of other full-time employees of Employer,
on the terms and subject to the conditions set forth in such
plans.
(g) STOCK COMPENSATION. This Agreement confirms the parties'
pre-existing agreement that, Employer shall issue to Employee an
option to purchase seven-hundred-thousand (700,000) Shares at an
exercise price of fsix United States dollars and twelve and
one-half cents (US$6.125) per share. The term of such option
shall be for a period of five (5) years from the Effective Date.
The option shall vest according to the following schedule: (i)
one-hundred-seventy-five-thousand (175,000) Shares on the
Effective Date; (ii) one-hundred-seventy-five-thousand (175,000)
Shares on November 11, 2000 (iii)
one-hundred-seventy-five-thousand (175,000) Shares on November
11, 2001; and (iv) one-hundred-seventy-five-thousand (175,000)
Shares on November 11, 2002.
However, vesting shall be accelerated in full in the event of
death, disability, involuntary termination without Cause (as
defined in Section 2.1(ii) above); the termination of employment
with Employer's consent; the filing of a voluntary or
involuntary bankruptcy by Employer; or upon the sale, pledge or
distribution of Employer's assets defined as follows: (W) the
sale of forty-five percent (45%) or more of Employer's assets;
(X) the entry into an agreement covering over fifteen (15%) of
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the voting common stock to a related party, as defined in
Section 12 of the Securities Act of 1933, as amended, without
Employee's written consent, which will not be unreasonably
withheld; or (Y) a recapitalization of Employer after six (6)
months from the date of the execution of this Agreement; or (Z)
a split of any manner in Employer's voting common stock.
(h) AUTOMOBILE ALLOWANCE. During the Term, Employer shall pay
Employee seven-hundred-fifty United States dollars (US$750.00)
per month as an allowance for the use of Employee's automobile.
In lieu of such allowance, Employer may furnish, or lease, an
automobile mutually acceptable to both Employer and Employee for
Employee's use.
3.2 EFFECT OF TERMINATION. Upon the termination of the employment of
Employee hereunder for Cause, Employee shall be entitled to all compensation and
benefits earned or accrued under Section 3.1 as of the effective date of
termination. Upon the termination of this Agreement during the first thirty (30)
months of the Initial Term or the then Successive Term, as the case may be, for
any reason other than for Cause, Employee shall be entitled to receive all
compensation and benefits provided in Section 3.1 through the end of the Initial
Term or the then Successive Term, as the case may be. Upon the termination of
this Agreement during the last six (6) months of the Initial Term or the then
Successive Term, as the case may be, for any reason other than for Cause,
Employee shall be entitled to receive all compensation and benefits earned or
accrued under Section 3.1 as of the effective date of termination plus an amount
equal to six (6) months Salary and continuation of benefits for six (6) months.
SECTION 4. NONSOLICITATION.
4.1 DEFINITIONS. For the purposes of this Section 4, the following
definitions shall apply.
(a) "Confidential Information" means any confidential, proprietary
business information or data belonging to or pertaining to
Employer that does not constitute a "Trade Secret" (as
hereinafter defined) and that is not generally known by or
available through legal means to the public, including, but not
limited to, information regarding the Employer's customers or
actively sought prospective customers, acquisition targets,
suppliers, manufacturers and distributors gained by Employee as
a result of his employment with Employer.
(b) "Customer" means actual customers or actively sought prospective
customers of Employer.
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(c) "Trade Secrets" means information or data of or about Employer,
including but not limited to technical or non-technical data,
formulas, patterns, compilations, programs, devices, methods,
techniques, drawings, processes, financial data, financial
plans, products plans, or lists of actual or potential
customers, clients, distributees or licensees, information
concerning or Employer's finances, services, staff, contemplated
acquisitions, marketing investigations and surveys, that are not
generally known to, and/or are not readily ascertainable by
proper means by, other persons.
(d) "Work Product" means any and all work product property, data
documentation or information of any kind prepared, conceived,
discovered, developed or created by Employee for Employer or its
affiliates' clients or customers for utilization in Employer's
business, not generally known by or not readily ascertainable by
proper means by other persons who can obtain economic value from
their disclosure or use.
4.2 TRADE NAME AND CONFIDENTIAL INFORMATION.
(a) Employee hereby agrees that at all times during the Term and
thereafter:
(i) Employee shall not, directly or by assisting others own,
manage, operate, join, control or participate in the
ownership, management, operation or control of, or be
connected in any manner with, any business conducted under
any corporate or trade name of Employer or name confusingly
similar thereto, without the prior written consent of
Employer;
(ii) Employee shall hold in confidence all Trade Secrets and all
Confidential Information and will not, either directly or
indirectly, use, sell, lend, lease, distribute, license,
give, transfer, assign, show, disclose, disseminate,
reproduce, copy, appropriate or otherwise communicate any
Trade Secrets or Confidential Information, without the
prior written consent of Employer; and
(iii) During the Term Employee shall immediately notify Employer
of any unauthorized disclosure or use of any Trade Secrets
or Confidential Information of which Employee becomes
aware, Employee shall assist Employer, to the extent
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necessary, in the procurement or any protection of
Employer's rights to or in any of the Trade Secrets or
Confidential Information.
(b) Upon the request of Employer, Employee shall deliver to Employer
all memoranda, notes, records, manuals and other documents,
including all copies of such materials and all documentation
prepared or produced in connection therewith, pertaining to the
performance of Employee's services hereunder or Employer's
business or containing Trade Secrets or Confidential
Information, whether made or complied by Employee or furnished
to Employee from another source by virtue of Employee's
employment with Employer.
(c) To the greatest extent possible, all Work Product shall be
deemed to be "work made for hire" (as defined in the Copyright
Act, 17 U.S.C.A. Section 101 et seq., as amended) and owned
exclusively by Employer. Employee hereby unconditionally
and irrevocably transfers and assigns to Employer all rights,
title and interest Employee may have in or to any and all Work
Product, including, without limitation, all patents, copyrights,
trademarks, service marks and other intellectual property rights
arising out of the Work Product. Employee agrees to execute and
deliver to Employer any transfers, assignments, documents or
other instruments which Employer may deem necessary or
appropriate to vest complete title and ownership of any and all
such Work Product, and all rights therein, exclusively in
Employer.
4.3 NONSOLICITATION AND NONCOMPETE. Employee hereby agrees that
Employee will not, during the Term and for a period of one (1) year following
the Term, either directly or indirectly, alone or in conjunction with any other
party, on the North American continent:
(a) solicit, divert or appropriate or attempt to solicit, divert or
appropriate, any Customer for the purpose of providing the
Customer with services or products competitive with those
offered by Employer during the Term; or
(b) solicit or attempt to solicit any officer, director, employee,
consultant, contractor, agent, lessor, lessee, licensor,
licensee, supplier or any shareholder of Employer or other
personnel of Employer or any of its affiliates or subsidiaries
to terminate, alter or lessen that party's affiliation with
Employer or such affiliate or subsidiary or to violate the terms
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of any agreement or understanding between such employee,
consultant, contractor or other person and Employer; or
(c) engage in, as owner, stockholder, employee, partner, agent,
representative or otherwise, or have an interest in (except for
ownership of publicly trade securities representing not more
than five percent (5%) of the outstanding voting shares), any
business, firm, corporation or other entity in direct
competition with the business of Employer.
(i) Upon the conclusion of the Initial Term, if this Agreement
is not renewed for a Successive Term, Employee may be
engaged solely as an employee in any business, firm,
corporation or other entity in direct competition with the
business of Employer.
Nothing contained in this Section 4 shall prohibit Employee from
acquiring not more than five percent (5%) of any competitor of Employer whose
common stock is publicly traded on a national securities exchange or in the
over-the-counter market or from acquiring any percentage of any company which is
non-competitive with Employer.
SECTION 5.MISCELLANEOUS.
5.1 SEVERABILITY. The covenants in this Agreement shall be construed
as covenants independent of one another and as obligations distinct from any
other contract between Employee and Employer. Any claim that Employee may have
against Employer shall not constitute a defense to enforcement by Employer of
this Agreement.
5.2 SURVIVAL OF OBLIGATIONS. The covenants in Section 4 of this
Agreement shall survive termination of Employee's employment for the period set
forth therein.
5.3 NOTICES. Any notice or other document to be given hereunder by
any party hereto to any other party hereto shall be in writing and delivered in
person or by courier, by telecopy transmission or sent by any express mail
service, postage or fees prepaid at the following addresses:
EMPLOYER: Internet Cable Corporation
-------- 000 Xxxx Xxxxxx, Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Secretary
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WITH A
COPY TO: Xxxxxxx, Xxxxxx & Xxxxxxxxx, LLP
------- 000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxxxxxx X. Xxxxx, Esq.
EMPLOYEE: Xxxxxx Xxxxxxxx
-------- 0 Xxxxxxxx Xxxxxxxx
Xxxxxxx, Xxxxxxx, Xxxxxx X00 0X0
or at such other address or number for a party as shall be specified by like
notice. Any notice which is delivered in the manner provided herein shall be
deemed to have been duly given to the party to whom it is directed upon actual
receipt by such party or its agent.
5.4 BINDING EFFECT. This Agreement inures to the benefit of, and is
binding upon, Employer and their respective successors and assigns, and
Employee, together with Employee's executor, administrator, personal
representative, heirs, and legatees.
5.5 ENTIRE AGREEMENT. This Agreement is intended by the parties
hereto to be the final expression of their agreement with respect to the subject
matter hereof and is the complete and exclusive statement of the terms thereof,
notwithstanding any representations, statements or agreements to the contrary
heretofore made. This Agreement supersedes and terminates all prior employment
and compensation agreements, arrangements and understandings between or among
Employer, Employer's Management and Employee. This Agreement may be modified
only by a written instrument signed by all of the parties hereto.
5.6 ARBITRATION. Any claim or controversy arising out of or relating
to the formation, interpretation and enforcement of this Agreement or any breach
thereof, shall be settled by arbitration, in accordance with the ten current
rules of the American Arbitration before a panel of three (3) arbitrators. Any
such arbitration shall take place in Philadelphia, Pennsylvania. Judgement upon
the written award rendered by a majority of the arbitrators may be entered in
the court having jurisdiction thereof. The written decision of the majority of
the arbitrators shall be valid, binding and final, and shall be a condition
precedent to any legal action that any party may contemplate against the other,
except to compel arbitration pursuant hereto.
5.7 GOVERNING LAW. This Agreement shall be deemed to be made in, and
in all respects shall be interpreted, construed, and governed by and in
accordance with, the laws of the Commonwealth of Pennsylvania. No provision of
this Agreement shall be construed against or interpreted to the disadvantage of
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any party hereto by any court or other governmental or judicial authority or by
any board of arbitrators by reason of such party or its counsel having or being
deemed to have structured or drafted such provision.
5.8 ATTACHMENT. Except as required by law, the right to receive
payments under this Agreement shall not be subject to attachment, sale, pledge,
encumbrance, charge, levy or similar process or assignment, and any attempt to
do so shall be null and void.
5.9 HEADINGS. The section and paragraph headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
5.10 SPECIFIC PERFORMANCE. Each party hereto hereby agrees that any
remedy at law for any breach of the provisions contained in this Agreement shall
be inadequate and that the other parties hereto shall be entitled to specific
performance and any other appropriate injunctive relief in addition to any other
remedy such party might have under this Agreement or at law or in equity.
5.11 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the _____day of December, 1999.
INTERNET CABLE CORPORATION
By:__________________________
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Chief Executive Officer
By:___________________________
Xxxxxx Xxxxxxxx
