Employment Agreement - Interactive Gallery Inc. and Gregory Dumas
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EMPLOYMENT AGREEMENT
BETWEEN
GREGORY DUMAS
AND
INTERACTIVE GALLERY, INC.
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October 27, 1999
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TABLE OF CONTENTS
PAGE
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1. EMPLOYMENT PERIOD..................................................1
2. TERMS OF EMPLOYMENT................................................1
(A) POSITION AND DUTIES..............................1
(B) COMPENSATION.....................................2
3. EARLY TERMINATION OF EMPLOYMENT....................................4
(A) DEATH OR DISABILITY..............................4
(B) CAUSE............................................4
(D) TERMINATION FOR OTHER REASONS....................5
(E) NOTICE OF TERMINATION............................5
(F) DATE OF TERMINATION. ............................6
4. OBLIGATIONS OF IGI UPON EARLY TERMINATION..........................6
(A) ACCELERATING EVENT...............................6
(B) GOOD REASON; OTHER THAN FOR CAUSE, DEATH OR
DISABILITY. ................................6
(C) DEATH............................................7
(D) CAUSE; OTHER THAN FOR GOOD REASON................7
(E) DISABILITY. .....................................7
(F) NONDISCLOSURE TO MEDIA...........................8
5. CHANGE IN CONTROL..................................................8
(A) DEFINED..........................................8
(B) ACCELERATING EVENT...............................8
6. NONEXCLUSIVITY OF EXECUTIVE'S RIGHTS...............................8
7. CONFIDENTIAL INFORMATION...........................................9
8. NON-COMPETE; NON-SOLICITATION......................................9
9. REMEDIES FOR EXECUTIVE'S BREACH...................................10
10. DISPUTE RESOLUTION................................................11
11. NO CONFLICTING OBLIGATIONS OF EXECUTIVE.........................11
12. INDEMNITY OF EXECUTIVE............................................11
13. SUCCESSORS........................................................11
14. MISCELLANEOUS.....................................................12
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EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement"), dated as of October 27,
1999 between GREGORY DUMAS, an individual (the "Executive"), and INTERACTIVE
GALLERY, INC. ("IGI"), a California corporation, recites and provides as
follows:
WHEREAS, the Board of Directors of IGI (the "Board") desires that IGI
retain the services of the Executive, and the Executive desires to remain
employed with IGI, all on the terms and subject to the conditions set forth
herein.
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants herein contained, IGI and the Executive agree as follows:
1. EMPLOYMENT PERIOD. IGI hereby agrees to employ the Executive, and
the Executive hereby agrees to accept employment by IGI, in accordance with the
terms and provisions of this Agreement, for the period commencing on the date of
this Agreement (the "Effective Date") and ending at midnight on March 31, 2003
(the "Employment Period").
2. TERMS OF EMPLOYMENT.
(A) POSITION AND DUTIES.
(i) During the Employment Period, the Executive shall serve as
President of IGI and shall have such authority and perform such executive duties
as are commensurate with that position. The Executive's duties shall include the
management and director of company activities for IGI, including business
development, acquisitions, web traffic and client management. The Executive
shall also be responsible for setting and attaining long and short-term goals
(revenues/profits) and strategic development for IGI. The Executive's services
shall be performed at IGI's headquarters in Sherman Oaks, California.
(ii) During the Employment Period, and excluding any periods
of vacation and leave to which the Executive is entitled, the Executive agrees
to devote his full attention and time during normal business hours to the
business and affairs of IGI and, to the extent necessary to discharge the duties
assigned to the Executive hereunder, to use his reasonable efforts to perform
faithfully such responsibilities. During the Employment Period it shall not be a
violation of this Agreement for the Executive to (A) serve on corporate, civic,
charitable, and professional association boards or committees, (B) deliver
lectures or fulfill speaking engagements and (C) manage personal investments, so
long as such activities do not materially interfere with the performance of the
Executive's responsibilities as an employee of IGI in accordance with this
Agreement.
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(B) COMPENSATION.
(i) Base Salary. During the Employment Period, the Executive shall
receive a base salary ("Annual Base Salary"), which shall be paid in equal
installments on a semi-monthly basis, at the annual rate of not less than One
Hundred Ten Thousand Dollars ($110,000) per year. During the Employment Period,
the Annual Base Salary shall be reviewed at least annually by the Compensation
Committee of the Board of Directors of New Frontier Media, Inc. ("NOOF"). Any
increase in Annual Base Salary shall not serve to limit or reduce any other
obligation to the Executive under this Agreement. Annual Base Salary shall not
be reduced and the term "Annual Base Salary" as used in this Agreement shall
mean the Annual Base Salary as so increased.
(ii) Short-Term Incentive Bonus. In addition to Annual Base
Salary, the Executive shall participate in an annual incentive bonus plan. Such
plan shall provide the Executive with the opportunity to earn a bonus based on
satisfaction of performance criteria of gross revenues for IGI. Specifically,
the Executive shall be entitled to receive a bonus equal to .62% of the amount
by which IGI's annual gross revenues exceed Twenty Million Dollars
($20,000,000), but less than Forty Million Dollars ($40,000,000), and 1% of the
amount of IGI's annual gross revenues exceed Forty Million Dollars
($40,000,000), (collectively, the "Target Figures"). The bonus payable pursuant
to this Section 2(B)(ii) for any fiscal year shall be paid to the Executive in
estimated quarterly payments with the year-end payment due no later than the
30th day following the issuance of the audited financial statements of IGI for
such year. Notwithstanding the foregoing, the Compensation Committee shall have
full authority to set and change the Target Figures, as it sees fit. The first
full annual period shall be April 1, 2000, to March 31, 2001 and there shall be
a prorated partial period from the date hereof to March 31, 2000.
(iii) Long-Term Incentives: Stock Options. The Executive
shall receive a grant of non statutory stock options of fifty thousand (50,000)
shares of NOOF common stock. The options shall have a term of ten (10) years
(subject to earlier expiration as hereinafter provided), shall have an exercise
price equal to 100% of the fair market value, as of the close of trading on the
date of this Agreement, of the shares of common stock subject to such stock
options, based upon the ten day trading average of the common stock prior to
such date, and shall vest and become exercisable in three (3) equal annual
installments on the first through the third anniversaries of the Effective Date;
provided, however, that such stock options shall vest immediately and become
exercisable in their entirety in the event that an Accelerating Event (as
hereinafter defined in Section 4(A)) occurs. To the extent not previously
exercised, all such stock options shall expire 90 days following the Date of
Termination (as hereinafter defined in Section 3(F));provided, however, that the
Executive, or his heirs or legal representatives in the event of the Executive's
death, may exercise all or any part of such stock options as were exercisable as
of the close of business on the Date of Termination for a period of two (2)
years following such Date of Termination in the event an Accelerating Event (as
hereinafter defined in
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Section 4(A)) occurs. Such stock options shall include a provision for
adjustment in the option price to reflect any extraordinary distribution made
with respect to the common stock during the term of the options. In the event of
a capital adjustment resulting from a stock dividend, stock split,
reorganization, merger, consolidation, spinoff, a combination or exchange of
shares or other transaction having a similar substantive effect, the number
shares of stock subject to the stock options and the option price shall be
equitably adjusted. Such stock options shall be evidenced by a written stock
option award agreement between NOOF and the Executive, the terms of which shall
be agreed to by the parties in good faith as soon as practical.
(iv) Long-Term Incentives. Other. During the Employment
Period, the Executive shall be entitled to participate in long-term incentive
plans and programs applicable generally to other peer executives of IGI. Such
participation shall commence with respect to IGI's 1999 fiscal year.
(v) Savings and Retirement Plans. During the Employment
Period, the Executive shall be entitled to participate in all savings and
retirement plans, practices, policies and programs applicable generally to other
peer executives of IGI, including any 401(k) plan maintained by IGI.
(vi) Welfare Benefit Plans. During the Employment Period, the
Executive and/or the Executive's family and dependents, as the case may be,
shall be eligible for participation in and shall receive all benefits under all
welfare benefit plans, practices, policies and programs provided by IGI
(including, without limitation, medical, prescription, dental, disability,
salary continuance, employee life, group life, accidental death and travel
accident insurance plans and programs) to the extent applicable generally to
other peer executives of IGI.
(vii) Expenses. During the Employment Period, the Executive
shall be entitled to receive prompt reimbursement for all employment-related
expenses incurred by the Executive in accordance with the most favorable
policies, practices and procedures of IGI as in effect generally from time to
time after the Effective Date with respect to other peer executives of IGI.
(viii) Fringe Benefits. During the Employment Period, the
Executive and/or the Executive's family and dependents shall be entitled to
fringe benefits in accordance with the most favorable plans, practices, programs
and policies of IGI as in effect generally from time to time after the Effective
Date with respect to other peer executives of IGI.
(ix) Office and Support Staff. During the Employment Period,
the Executive shall be entitled to retain the same office as he currently uses
with the same furnishings and other appointments, and to exclusive personal
secretarial and other assistance, and to facilities and equipment, at least
equal to the most favorable of the foregoing provided
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generally from time to time after the Effective Date with respect to other peer
executives of IGI.
(x) Vacation. During the Employment Period, the Executive
shall be entitled to paid vacation in accordance with the most favorable plans,
policies, programs and practices of IGI as in effect generally from time to time
after the Effective Date with respect to other peer executives of IGI, provided
that the vacation will not be not less than four (4)weeks per year. The accrued
vacation of Executive of four (4) weeks prior to the date of this Agreement
shall continue in effect for the term of this Agreement until used.
(xi) Car Allowance. During the Employment Period, the
Executive shall be entitled to a car allowance of at least $500 per month, in
accordance with IGI's car allowance policy, in lieu of expenses associated with
the operation of his automobile.
(xii) Employment Conditions. IGI shall take all possible
efforts to maintain the general working conditions for the Executive at IGI as
in existence prior to the date of this Agreement. The general working conditions
include the ability of Executive to establish his own working hours, the current
style of dress for employees, and other similar lifestyle matters.
3. EARLY TERMINATION OF EMPLOYMENT.
(A) DEATH OR DISABILITY. The Executive's employment shall
terminate automatically upon the Executive's death during the Employment Period.
If IGI determines in good faith that the Disability of the Executive has
occurred during the Employment Period (pursuant to the definition of disability
set forth below), it may give to the Executive notice of its intention to
terminate the Executive's employment. In such event, the Executive's employment
with IGI shall terminate effective on the thirtieth (30th) day after receipt of
such notice by the Executive (the "Disability Effective Date"), provided that,
within the thirty (30) days after such receipt, the Executive shall not have
returned to full-time performance of the Executive's duties. For purposes of
this Agreement, "Disability" shall mean the absence of the Executive from the
Executive's duties with IGI on a full-time basis for one hundred eighty (180)
consecutive business days as a result of incapacity due to mental or physical
illness which is determined to be total and permanent by a physician selected by
IGI or its insurers and acceptable to the Executive or the Executive's legal
representative (such agreement as to acceptability not to be withheld
unreasonably).
(B) CAUSE. IGI may terminate the Executive's employment during
the Employment Period for Cause. For purposes of this Agreement, "Cause" shall
mean (i) the conviction of the Executive for committing an act of fraud,
embezzlement, theft or other act constituting a felony or the guilty or nolo
contendere plea of the Executive to such a felony; (ii) a material act of
dishonesty or breach of trust on the part of the Executive resulting or
intending to result directly or indirectly in material personal gain or
enrichment at the
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expense of IGI; or (iii) Executive's continuing, repeated, willful failure or
refusal to perform his duties required by this Agreement, provided that
Executive shall have first received written notice from IGI stating with
specificity the nature of such failure and refusal and affording Executive an
opportunity, as soon as practicable, to correct the acts or omissions complained
of.
(C) GOOD REASON. The Executive may terminate his employment
for Good Reason. For purposes of this Agreement, "Good Reason" shall mean, in
the absence of the consent of the Executive, a reasonable determination by the
Executive that any of the following has occurred:
(i) the assignment to the Executive of any duties inconsistent
in any material respect with the Executive's position(including status, offices,
titles and reporting requirements), authority, duties or responsibilities as
contemplated by Section 2(A) of this Agreement, or any other action by IGI which
results in a material diminution in such position, authority, duties or
responsibilities, excluding for this purpose an isolated and insubstantial
action not taken in bad faith and which is remedied by IGI promptly after
receipt of notice thereof given by the Executive; or
(ii) any failure by IGI to comply with any of the provisions
of this Agreement applicable to it, other than any isolated and insubstantial
failure not occurring in bad faith and which is remedied promptly after notice
thereof from the Executive.
(D) TERMINATION FOR OTHER REASONS. IGI may terminate the
employment of the Executive without Cause by giving notice to the Executive at
least sixty (60) days prior to the Date of Termination. The Executive may resign
from his employment without Good Reason hereunder by giving notice to IGI at
least sixty (60) days prior to the Date of Termination.
(E) NOTICE OF TERMINATION. Any termination shall be
communicated by Notice of Termination to the other party. For purposes of this
Agreement, a "Notice of Termination" means a notice which (i) indicates the
specific termination provision in this Agreement relied upon, (ii) to the extent
applicable, sets forth in reasonable detail the facts and circumstances claimed
to provide a basis for termination of the Executive's employment under the
provision so indicated and (iii) if the Date of Termination (as defined below)is
other than the date of receipt of such notice, specifies the termination
date(which date shall be not more than fifteen (15) days after the giving of
such notice, unless otherwise required by Section 3(f)). The failure by the
Executive or IGI to set forth in the Notice of Termination any fact or
circumstance shall not waive any right of the Executive or IGI hereunder or
preclude the Executive or IGI from asserting such fact or circumstance in
enforcing the Executive's or IGI's rights hereunder.
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(F) DATE OF TERMINATION. "Date of Termination" shall mean (i)
if the Executive's employment is terminated by IGI for Cause, or by the
Executive for Good Reason, the date of receipt of the Notice of Termination or
any permitted later date specified therein, as the case may be,(ii) if the
Executive's employment is terminated by IGI other than for Cause or Disability
or by the Executive other than for Good Reason, the Date of Termination shall be
the sixtieth (60th) day following the date of receipt of the Notice of
Termination or any later date specified therein, as the case maybe, and (iii) if
the Executive's employment is terminated by reason of the Executive's death or
Disability, the Date of Termination shall be the date of death of the Executive
or the Disability Effective Date, as the case may be.
4. OBLIGATIONS OF IGI UPON EARLY TERMINATION.
(A) ACCELERATING EVENT. As used in this Agreement, the term
"Accelerating Event" shall mean any of the following: (i)the Executive's
employment terminates under the circumstances described in Section 3(A), (ii)
the Executive is discharged without Cause, (iii) the Executive resigns with Good
Reason, or (iv) a Change in Control (as defined in Section 5(A)) occurs.
(B) GOOD REASON; OTHER THAN FOR CAUSE, DEATH OR DISABILITY.
If, during the Employment Period, IGI shall terminate the Executive's employment
other than for Cause, death or Disability or the Executive shall terminate
employment for Good Reason:
(i) IGI shall pay to the Executive in a lump sum in cash
within thirty (30) days after the Date of Termination the sum of (A) the
Executive's Annual Base Salary through the Date of Termination to the extent not
theretofore paid; (B) to the extent not theretofore paid, any annual bonus
payable to the Executive for any prior completed fiscal year; (C) the product of
(x) the largest annual bonus paid or payable to the Executive in respect of any
of the three (3) fiscal years immediately preceding the fiscal year in which the
Date of Termination occurs (the "Highest Annual Bonus") and(y) a fraction, the
numerator of which is the number of days in the current fiscal year through the
Date of Termination, and the denominator of which is 365; (D) any compensation
previously deferred by the Executive (together with any accrued interest or
earnings thereon) to the extent not theretofore paid; and (E) any accrued
vacation pay, expense reimbursement and any other entitlements accrued by the
Executive under Section 2(B), to the extent not theretofore paid (the sum of the
amount described in clauses (A), (B), (C), (D)and (E) shall be hereinafter
referred to as the "Accrued Obligations"); and
(ii) IGI shall pay to the Executive in equal monthly
installments beginning thirty (30) days following the Date of Termination an
amount equal to the larger of (A) the sum of the Executive's Annual Base Salary
and Highest Annual Bonus payable for the
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remaining term of this Agreement, or (B) the sum of the Executive's Annual Base
Salary and Highest Annual Bonus payable for 12 months (without duty of
mitigation); and
(iii) If an Accelerating Event involving the Executive's
termination occurs within eighteen (18) months following the date of this
Agreement, IGI shall pay to the Executive an additional One Hundred Thousand
Dollars ($100,000).
(iv) For the remainder of the Employment Period (as it would
continue but for such early termination), or such longer period as any plan,
program, practice or policy may provide, IGI shall continue benefits to the
Executive and/or the Executive's family and dependents at least equal to those
which would have been provided to them in accordance with the plans, programs,
practices and policies described in Section 2(B)(vi) if the Executive's
employment had not been terminated, in accordance with the most favorable plans,
practices, programs or policies of IGI as in effect generally at any time
thereafter with respect to other peer executives of IGI and their families
("Welfare Benefit Continuation"). If the Executive becomes redeployed with
another employer and is eligible to receive medical or other welfare benefits
under another employer-provided plan, the medical and other welfare benefits
described herein shall be secondary to those provided under such other plan
during such applicable period of eligibility. For purposes of determining
eligibility (but not the time of commencement of benefits), the Executive shall
be considered to have remained employed until the end of the Employment Period
(as it would continue but for such early termination) and to have retired on the
last day of such period.
(C) DEATH. If the Executive's employment is terminated by
reason of the Executive's death during the Employment Period, this Agreement
shall terminate without further obligation to the Executive's legal
representatives under this Agreement, other than for payment of Accrued
Obligations (which shall be paid to the Executive's estate or beneficiary, as
applicable, in a lump sum in cash within thirty (30) days of the Date of
Termination) and the timely payment or provision of the Welfare Benefit
Continuation.
(D) CAUSE; OTHER THAN FOR GOOD REASON. If the Executive's
employment shall be terminated for Cause or the Executive terminates his
employment without Good Reason during the Employment Period, this Agreement
shall terminate without further obligations to the Executive other than the
obligation to pay to the Executive the Accrued Obligations and the amount of any
compensation previously deferred by the Executive, in each case to the extent
theretofore unpaid, all of which shall be paid in cash within thirty (30) days
of the Date of Termination.
(E) DISABILITY. If the Executive's employment shall be
terminated by reason of the Executive's Disability during the Employment Period,
this Agreement shall terminate without further obligation to the Executive,
other than for payment of Accrued Obligations and the timely payment or
provision of the Welfare Benefit Continuation. Accrued Obligations shall be paid
to the Executive in a lump sum in cash within thirty (30)
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days of the Date of Termination. The Executive shall be entitled after the
Disability Effective Date to receive disability and other benefits as in effect
at the Disability Effective Date with respect to other peer executives of IGI
and their families.
(F) NONDISCLOSURE TO MEDIA. After the Date of Termination or
the end of Employment Period, the Executive and IGI agree that they will not
discuss the Executive's employment and resignation or termination(including the
terms of this Agreement) with any representatives of the media, either directly
or indirectly, without the consent of the other party hereto.
5. CHANGE IN CONTROL.
(A) DEFINED. For purposes of this Agreement, a "Change in
Control" of IGI shall be deemed to have occurred as of the first day that any
one or more of the following conditions shall have occurred:
(i) Any "person" (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the "Act")), becomes
the "beneficial owner" (as defined in Rule 13-d under the Act) directly or
indirectly, of securities representing more than fifty percent (50%) of the
total voting power represented by NOOF's then outstanding voting securities; or
(ii) A change in the composition of the Board, as a result of
which fewer than a majority of the directors are Incumbent Directors. "Incumbent
Directors" shall mean directors who either (A) are directors of NOOF as of the
date hereof, or (B) are elected, or nominated for election, to the Board with
the affirmative votes of at least a majority of the Incumbent Directors at the
time of such election or nomination (but shall not include an individual whose
election or nomination is in connection with an actual or threatened proxy
contest relating to the election of directors of NOOF); or
(iii) NOOF merges or consolidates with any other corporation
after which a majority of the shares of the resulting entity are not held by the
shareholders of NOOF prior to the merger, or NOOF adopts, and the stockholders
approve, if necessary, a plan of complete liquidation of NOOF, or NOOF sells or
disposes of substantially all of its assets.
(B) ACCELERATING EVENT. A Change in Control shall be an
Accelerating Event as defined in Section 4(A).
6. NONEXCLUSIVITY OF EXECUTIVE'S RIGHTS. Except as provided in Sections
4(B)(iii), 4(C) and 4(E), nothing in this Agreement shall prevent or limit the
Executive's continuing or future participation in any plan, program, policy or
practice provided by IGI or any of its affiliated companies and for which the
Executive may qualify, nor shall anything herein limit or otherwise affect such
rights as the Executive may have
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under any contract or agreement with IGI. Amounts which are vested benefits or
which the Executive is otherwise entitled to receive under any plan, policy,
practice or program of or any contract or agreement with IGI at or subsequent to
the Date of Termination shall be payable in accordance with such plan, policy,
practice or program or contract or agreement except as explicitly modified by
this Agreement.
7. CONFIDENTIAL INFORMATION.
(a) The Executive shall hold in a fiduciary capacity for the
benefit of IGI all secret or confidential information, knowledge or data
relating to IGI or any of its affiliated companies, and their respective
businesses, which shall have been obtained by the Executive during the
Executive's employment by IGI or any of its affiliated companies and which shall
not be or become public knowledge (other than by acts by the Executive or
representatives of the Executive in violation of this Agreement). After
termination of the Executive's employment with IGI, the Executive shall not,
without the prior written consent of IGI or except as may otherwise be required
by law or legal process, communicate or divulge any such information, knowledge
or data to anyone other than IGI and those designated by it. In no event shall
an asserted violation of the provisions of this Section 7 constitute a basis for
deferring or withholding any amounts otherwise payable to the Executive under
this Agreement.
(b) All records, files, memoranda, reports, price lists,
customer lists, drawings, designs, proposals, plans, sketches, documents,
computer programs, CAD systems, CAM systems, disks, computer printouts and the
like (together with all copies thereof) relating to the business of IGI, which
Executive shall use or prepare or otherwise have in his possession in the course
of, or as a result of, his employment hereunder shall, as between the parties
hereto, remain the sole property of IGI. Executive shall use such materials
solely for the benefit of IGI and shall not divulge any such materials other
than in furtherance of IGI's interests. Executive hereby agrees that he will
return all such materials, including copies, to IGI upon demand, or upon the
cessation of his employment.
(c) Any termination of the Executive's employment hereunder or
of this Agreement shall have no effect on the continuing operation of this
Section 7.
8. NON-COMPETE; NON-SOLICITATION.
(a) Except as is set forth below, for a period commencing on
the Effective Date hereof and ending on the first anniversary of the date the
Executive ceases to be employed by IGI (the "Non-Competition Period"), the
Executive shall not, directly or indirectly, either for himself or any other
person, own, manage, control, materially participate in, invest in, permit his
name to be used by, act as consultant or advisor to, render material services
for (alone or in association with any person, firm, corporation or other
business organization) or otherwise assist in any manner any business which is a
competitor of a substantial portion
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of IGI's business at the date the Executive ceases to be employed by IGI
(collectively, a "Competitor"); provided, however, that the restrictions set
forth above shall immediately terminate and shall be of no further force or
effect (i) in the event of a default by IGI of the performance of any of the
obligations hereunder, which default is not cured within ten (10) days after
notice thereof, or (ii) if the Executive's employment has been terminated by IGI
other than for Cause, or (iii) if the Executive resigns for Good Reason provided
that the Executive gives written notice to IGI whenever during the
Non-Competition Period that he desires to accept employment with a Competitor;
and that the payment specified in Section 4(B)(ii) hereof shall be mitigated by
the amount of salary and pro rata target bonus payable to the Executive by the
Competitor based on the Executive's initial terms of employment and attributable
to employment during the Non-Competition Period. Nothing herein shall prohibit
the Executive from being a passive owner of not more than five percent (5%) of
the equity securities of an enterprise engaged in such business which is
publicly traded, so long as he has no active participation in the business of
such enterprise.
(b) During the Non-Competition Period, the Executive shall
not, directly or indirectly, (i) induce or attempt to induce or aid others in
inducing an employee of IGI to leave the employ of IGI, or in any way interfere
with the relationship between IGI and an employee of IGI except in the proper
exercise of the Executive's authority, or (ii) in any way interfere with the
relationship between IGI and any customer, supplier, licensee or other business
relation of IGI.
(c) If, at the time of enforcement of this Section 8, a court
shall hold that the duration, scope, area or other restrictions stated herein
are unreasonable under circumstances then existing, the parties agree that the
maximum duration, scope, area or other restrictions reasonable under such
circumstances shall be substituted for the stated duration, scope, area or other
restrictions.
(d) The covenants made in this Section 8 shall be construed as
an agreement independent of any other provisions of this Agreement, and shall
survive the termination of this Agreement. Moreover, the existence of any claim
or cause of action of the Executive against IGI or any of its affiliates,
whether or not predicated upon the terms of this Agreement, shall not constitute
a defense to the enforcement of these covenants.
9. REMEDIES FOR EXECUTIVE'S BREACH. In the event Executive violates any
provision of Sections 7 or 8 and such violation continues after notice thereof
to the Executive and the expiration of a reasonable opportunity to cure, then
IGI may thereafter terminate the payment of any post-termination benefits
hereunder, and IGI will have no further obligation to Executive under this
Agreement. The parties acknowledge that any violation of Section 7 or 8 can
cause substantial and irreparable harm to IGI. Therefore, IGI shall be entitled
to pursue any and all legal and equitable remedies, including but not limited to
any injunctions.
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10. DISPUTE RESOLUTION. Any dispute or controversy arising under or in
connection with this Agreement shall be settled by binding arbitration, which
shall be the sole and exclusive method of resolving any questions, claims or
other matters arising under this Agreement or any claim that IGI has in any way
violated the non-discrimination and/or other provisions of Title VII of the
Civil Rights Act of 1964, as amended; the Age Discrimination in Employment Act
of 1967, as amended; the Americans with Disabilities Act; the Family and Medical
Leave Act; the Employee Retirement Income Security Act of 1974, as amended; and,
in general, any federal law or the law of the State of California. Such
proceeding shall be conducted by final and binding arbitration before a panel of
one or more arbitrators under the administration of the American Arbitration
Association, and in a location mutually agreed to by the Executive and IGI. The
Federal and State courts located in the United States of America are hereby
given jurisdiction to render judgment upon, and to enforce, each arbitration
award, and the parties hereby expressly consent and submit to the jurisdiction
of such courts. Notwithstanding the foregoing, in the event that a violation of
the Agreement would cause irreparable injury, IGI and the Executive agree that
in addition to the other rights and remedies provided in this Agreement (and
without waiving their rights to have all other matters arbitrated as provided
above) the other party may immediately take judicial action to obtain injunctive
relief.
11. NO CONFLICTING OBLIGATIONS OF EXECUTIVE. Executive represents and
warrants that he is not subject to any duties or restrictions under any prior
agreement with any previous employer or other person, and that he has no rights
or obligations except as previously disclosed to IGI which may conflict with the
interests of IGI or with the performance of the Executive's duties and
obligations under this Agreement. Executive agrees to notify IGI immediately if
any such conflicts occur in the future.
12. INDEMNITY OF EXECUTIVE. IGI shall indemnify and defend the
Executive against all claims relating to the performance of his duties hereunder
to the fullest extent permitted by applicable law.
13. SUCCESSORS.
(a) This Agreement is personal to the Executive and without
the prior consent of IGI shall not be assignable by the Executive otherwise than
by will or the laws of descent and distribution. This Agreement shall inure to
the benefit of and be enforceable by the Executive's legal representatives.
(b) This Agreement shall inure to the benefit of and be
binding upon IGI and its successors and assigns.
(c) IGI will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of IGI to assume expressly and
agree to perform this Agreement in the same manner and to the
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same extent that IGI would be required to perform it if no such succession had
taken place. As used in this Agreement, "IGI" shall mean IGI as herein before
defined and any successor to its business and/or assets as aforesaid which
assumes and agrees to perform this Agreement by operation of law, or otherwise.
14. MISCELLANEOUS.
(a) This Agreement shall be governed by and construed in
accordance with the laws of the State of California, without reference to
principles of conflict of laws. The captions of this Agreement are not part of
the provisions hereof and shall have no force or effect. This Agreement contains
the full and complete understanding between the parties hereto and supersedes
all prior understandings, whether written or oral pertaining to the subject
matter hereof. This Agreement may not be amended or modified otherwise than by a
written agreement executed by the parties hereto or their respective successors
and legal representatives.
(b) All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, or by telecopier,
or by courier to such address as either party shall have furnished to the other
in writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.
(c) In the event of a dispute arising out of this Agreement,
any party receiving any monetary or injunctive remedy, whether at law or in
equity, which is final and not subject to appeal shall be entitled to its
reasonable attorneys' fees and costs incurred with respect to obtaining such
remedy from the other party.
(d) The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.
(e) IGI may withhold from any amounts payable under this
Agreement such Federal, state or local taxes as shall be required to be withheld
pursuant to any applicable law or regulation.
(f) The Executive's or IGI's failure to insist upon strict
compliance with any provision hereof or any other provision of this Agreement or
the failure to assert any right the Executive or IGI may have hereunder, shall
not be deemed to be a waiver of such provision or right or any other provision
or right of this Agreement.
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IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand
and, pursuant to the authorization from its Board of Directors, IGI has caused
these presents to be executed in its name on its behalf, all as of the day and
year first above written.
COMPANY:
INTERACTIVE GALLERY, INC.
By /s/ Edward Bonn
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President
EXECUTIVE:
/s/ Gregory Dumas
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Gregory Dumas
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