Employment Agreement - SunnComm Inc. and William Howard Whitmore Jr.
EMPLOYMENT AGREEMENT
THIS AGREEMENT (the "Agreement") made this 26 th day of January, 2001 is by and
between SUNNCOMM, INC., A Nevada corporation ("Company"), and WILLIAM HOWARD
WHITMORE, Jr. an individual ("Employee").
RECITALS:
A. Company is engaged, among other things, in the business of
developing, licensing, and dispersing multi media content ("Company Business").
Employee has substantial experience and expertise in the area of executive
management.
B. Company desires to retain the services of Employee as an executive,
to act as its Vice President of Marketing and Communications, and Employee
desires and is willing to continue employment with the Company in that
capacity.
C. Company and Employee desire to embody the terms and conditions of
Employee's employment in a written agreement, which will supersede all prior
agreements of employment, whether written or oral, pursuant to the terms and
conditions hereinafter set forth.
D. The Board of Directors of Company (the "Board"), has determined that
it is in the best interests of Company and its shareholders to assure that
Company will have the continued dedication of Employee. Therefore, in order to
accomplish these objectives, the Board has caused Company to enter into this
Agreement.
AGREEMENT
In consideration of the recitals and mutual agreements hereinafter set
forth, the parties agree as follows:
1. Employment. Company agrees to continue to employ Employee on a
full-time basis, in accordance with the terms and conditions set forth herein,
and Employee agrees to accept such continued full-time employment in accordance
with said terms and conditions. Employee shall have such duties and
responsibilities as shall be allocated to him from time to time by the Board in
his capacity as the Vice President of Marketing and Communications. Employee's
title and duties may be changed from time to time in the discretion of
Company's Board so long as he is maintained in an executive capacity with
duties, responsibilities and privileges commensurate with his current level of
employment. Employee agrees to devote his full time, skill, knowledge and
attention to the business of Company and the performance of his duties under
this Agreement. Employee shall report directly to the Board.
2. Term. The initial term (the "Term") of employment under this
Agreement shall commence January 26, 2001 (the "Effective Date") and shall
continue for a period of two (2) years, unless earlier terminated as set forth
in Section 6 below. Thereafter, this Agreement shall automatically renew for an
additional two-year period (the "Renewal Term") unless either party gives the
other written notice of non-renewal at least 30 days prior to the expiration of
the Term or Renewal Term.
3. Compensation.
(a) Base Salary. Company agrees to pay Employee an initial annual base salary
of $78,000, before deducting all applicable withholdings which shall be payable
in accordance with Company's standard executive payroll policies as they may be
revised from time to time. Employee's annual base salary shall thereafter be
subject to annual adjustment in accordance with Company's standard executive
compensation policies, but in no event shall Employee's annual base salary be
less than $78,000 per year during the Term or Renewal Term. Performance
evaluation scheduled at 6 months from (the "Effective Date") for salary
increase with additional evaluations scheduled per company standards.
(b) Incentive Bonus. After commencing his duties as Vice President of
Marketing and Communications, Company's Executive Committee shall design and
present to the Board for review, adjustment and adoption, an incentive
compensation program for key employees. Employee shall be designated as a key
employee and shall be entitled to participate in such program, and if financial
targets established pursuant to the program are met, will be eligible to earn
in any year an additional maximum amount of compensation in the form of stock,
stock options and/or cash as determined by Company's Executive Committee.
c) Stock Options. Upon the execution of the Agreement, Employee shall
be entitled to participate in any qualified or non-qualified stock option plan
available to all employees
(d) Deductions. Company shall deduct from the payments make to Employee
hereunder any federal, state or local withholding or other taxes or charges
which Company is required to deduct under applicable law, and all amounts
payable to Employee under this Agreement are stated before any such deductions.
Company shall have the right to rely upon written opinion of counsel if any
questions arise as to any deductions.
4. Benefits.
(a) Insurance. In addition to the compensation described above, while Employee
is employed hereunder, Company shall pay for and provide Employee and his
dependents with the standard company health insurance package. Insurance
benefits will be active on (the "Effective Date") of employment agreement.
(b) Travel Expenses.. All business related travel expenses shall be paid for or
reimbursed by Company to Employee on a timely basis.
(c ) Employee shall receive a monthly automobile expense allowance of
$500.00
(c) Death. If Employee dies during the Term, or Renewal Term, if applicable,
this Agreement shall terminate immediately, and the Employee's legal
representatives shall be entitled to receive the base salary due the Employee
through the last day of the calendar month in which his death shall have
occurred and any other death benefits generally applicable to executive
employees.
(d) (Non-Renewal. If Employee's term of employment is not renewed by Company as
contemplated by Section 2 at the end of the Term, Company shall, (i) pay to
Employee the base salary due to him through the end of the Term, less
applicable withholdings
(e) Severance Package. Employee shall receive a severance package including
salary and benefits equal to a three month period immediately following
severance for any reason other than "cause". Any "Stock Options" partially
vested will become 100 % fully vested through the current vesting period at
time of severance.
(f) Signing Bonus: Peter H Jacobs shall deliver to William H. Whitmore Jr. on
or before March 30, 2001 company common stock in the amount of 25,000 shares
without restriction or legend.
(g) Vacation Pay: Employee shall be entitled to paid vacation for (3) three
weeks per year for the first two year employment term. Employer reserves the
right to determine or approve the vacation time in order to ensure efficient
and orderly business operations. Any vacation time not used during the year may
be used in subsequent years.
5. Non-competition: Confidential Information.
(a) Confidential Information. Employee acknowledges that Employee may receive,
or contribute to the production of, Confidential Information. For purposes of
the Agreement, Employee agrees that "Confidential Information" shall mean
information of material proprietary to Company of designated as Confidential
Information by Company and not generally known by non-Company personnel, which
Employee develops or of or to which Employee may obtain knowledge or access
through or as a result of Employee's relationship with Company (including
information conceived, originated, discovered or developed in whole or in part
by Employee). Confidential Information includes, but is not limited to, the
following types of information and other information of a similar nature
(whether or not reduced to writing) related to Company's business: discoveries,
inventions, ideas, concepts, research, development, processes, procedures,
"know-how", formulae, marketing techniques and materials, marketing and
development plans, business plans, customer names and other information related
to customers, price lists, pricing policies, financial information, employee
compensation, and computer programs and systems. Confidential Information also
includes any information described above which Company obtains from another
party and which Company treats as proprietary or designates as Confidential
Information, whether or not owned by or developed by Company. Employee
acknowledges that the Confidential Information derives independent economic
value, actual or potential, from not being generally know to, and not being
readily ascertainable by proper means by, other persons who can obtain economic
value from its disclosure or use. Information publicly known without breach of
this Agreement that is generally employed by the trade at or after the time
Employee first learns of such information, or generic information or knowledge
which Employee would have learned in the course of similar employment or work
elsewhere in the trade, shall not be deemed part of the Confidential
Information. Employee further agrees:
(i) To furnish Company on demand, at any time during or after employment, a
complete list of the names and addresses of all present, former and potential
customers and other contacts gained while an employee of Company in Employee's
possession, whether or not in the possession or within the knowledge of
Company;
(ii) that all notes, memoranda, documentation records in any way incorporating
or reflecting any Confidential Information shall belong exclusively to Company,
and Employee agrees to turn over all copies of such materials in Employee's
control to Company upon request or upon termination of Employee's employment
with Company.
(iii) that while employed by Company and thereafter Employee will hold in
confidence and not directly or indirectly reveal, report, publish, disclose or
transfer any of the Confidential Information to any person or entity, or
utilize any of the Confidential Information for any purpose, except in the
course of Employee's work for Company; and
(iv) that any idea in whole or in part conceived of or made by Employee during
this term of his employment, consulting, or similar relationship with the
Company which relates directly or indirectly to Company's current or planned
lines of business and is made through the use of any of the Confidential
Information of Company or any of Company's equipment, facilities, trade secrets
or time, or which results from any work performed by Employee for Company,
shall belong exclusively to Company and shall be deemed a part of the
Confidential Information for purposes of this Agreement. Employee hereby
assigns and agrees to assign to Company all rights in and to such Confidential
Information whether for purposes of obtaining patent or copyright protection or
otherwise. Employee shall acknowledge and deliver to Company, without charge to
Company (but at its expense) such written instruments and do such other acts,
including giving testimony in support of Employee's authorship or inventorship,
as the case may be, necessary in the opinion of Company to obtain patents or
copyrights or to otherwise protect or vest in Company the entire right and
title in and to the Confidential Information.
(b) Non-competition. During the Term, Employee agrees that he shall not enter
into or engage, directly or indirectly, whether on his own account or as a
shareholder (other than as a less than 2% shareholder of a publicly-held
company), partner, joint venture, employee, consultant, advisor, and/or agent,
of any person, firm, corporation, or other entity, in any or all of the
following activities: Exception letter drafted prior to employment to identify
exceptions due to pre-existing equity positions.
(i) Engaging in Company Business in the United States;
(ii) soliciting the past or existing customers, clients, suppliers, or business
patronage of Company or any of its predecessors, affiliates or subsidiaries, or
use any Confidential Information (as defined in Section 5(a)) for the purpose
of, or which results in, competition with Company or any of its affiliates or
subsidiaries;
(iii) soliciting the employment of any employees of Company or any of its
affiliates or subsidiaries; and
(iv) promoting or assisting, financially or otherwise, any person, firm,
association, corporation, or other entity engaged in the Company Business in
the United States.
(c) Injunctions. It is agreed that the restrictions contained in this Section
5 are reasonable, but it is recognized that damages in the event of the breach
of any of the restrictions will be difficult or impossible to ascertain; and,
therefore, Employee agrees that, in addition to and without limiting any other
right or remedy Company may have. Company shall have the right to an injunction
against Employee issued by a court of competent jurisdiction enjoining any such
breach without showing or proving any actual damage to Company.
(d) Employee also agrees, acknowledges, covenants, represents and warrants as
follows:
(i) That he has read and fully understands the foregoing restrictions and that
he has consulted with a competent attorney regarding the uses and
enforceability of restrictive covenants;
(ii) that he is aware that there may be defenses to the enforceability of the
foregoing restrictive covenants, based on time or territory considerations, and
that he knowingly, consciously, intentionally and entirely voluntarily,
irrevocably waives any and all such defenses and will not assert the same in
any action or other proceeding brought by Company for the purpose of enforcing
the restrictive covenants or in any other action or proceeding involving him
and Company;
(iii) that he is fully and completely aware that, and further understands
that, the foregoing restrictive covenants are an essential part of the
consideration for Company entering into this Agreement and that Company is
entering into this Agreement in full reliance on these acknowledgements,
covenants, representations and warranties; and
(iv) that the existence of any claim or cause of action by him against Company,
if any, whether predicated upon this Agreement or otherwise, shall not
constitute a defense to the enforcement by Company of the foregoing restrictive
covenants which shall be litigated separately.
(e) If period of time and/or territory described above are nevertheless
held to be in any respect an unreasonable restriction (after giving due
consideration to the provisions of Section 5(d) above), then it is agreed that
the court so holding may reduce the territory to which the restriction pertains
or the period of time in which it operates or may reduce both such territory
and such period, to the minimum extent necessary to render such provision
enforceable.
(f) The obligations described in this Section 5 shall survive any termination
of the Agreement or any termination of the employment relationship created
hereunder for the maximum period of time said obligations may be legally
enforced.
(6) Inventions and Creations.
(a) Employee agrees that all inventions, discoveries, developments,
improvements, ideas, distinctive marks, symbols or phrases, copyrightable
creations, works of authorship, mask works and other contributions including
but not limited to software, advertising, design, artwork, manuals and writings
(collectively referred to as "Creations"), whether or not protectable by
statute, which have been, or are in the future conceived, created, made,
developed or acquired by Employee, wither individually or jointly, while
employee is retained by Company and relate in any manner to Employee's work for
Company, the research or business of Company or fields into which the business
of Company may extend, belong to Company. Employee hereby sells, assigns, and
transfers to Company exclusively and irrevocably, without further compensation,
all ownership, title and rights in and to all of the Creations. Employee
further agrees to promptly and fully disclose the Creations to Company in
writing, if requested by Company, and to execute and deliver any and all lawful
applications, assignments and other documents which Company requests for
protecting the Creations in the United States or any other country. Company
shall have the full and sole power to prosecute such applications and to take
all other actions concerning the Creations, and Employee agrees to cooperate
fully, at the expense of Company, in the preparation and prosecution of all
such applications and any legal actions and proceedings concerning the
Creations.
(b) Employee agrees and warrants that the Creations will be Employee's
original work and will not improperly or illegally incorporate any material
created by or belonging to others.
(c) Employee agrees to and does hereby sell, assign, convey and transfer to
Company any and all manuscripts, programs, writings, pictorial materials,
originals, camera-ready copies, and all drafts and notes of the Creations,
regardless of the media in which they might exist, and to provide these
materials to Company promptly whenever requested by Company and upon completion
of the Agreement, and to execute documents, give testimony and otherwise
cooperate fully with Company to establish and/or confirm Company's ownership,
patent, copyright and/or trademark rights concerning the Creations.
(d) Without diminishing in any way the rights granted to Company above, if a
Creation is described in a patent, copyright or trademark application, or is
disclosed to a third party by Employee within two (2) years after Employee's
employment with Company is terminated, Employee agrees that it is to be
presumed that the Creation was conceived, created, made, developed or acquired
by Employee during the period of his employment with Company, unless Employee
can prove otherwise by clear and convincing evidence.
7. Governing Law and Venue. Nevada law shall govern the construction and
enforcement of this Agreement and the parties agree that any litigation
pertaining to this Agreement shall be in courts located in Maricopa County,
Arizona.
8. Construction. The language in all parts of this Agreement shall in
all cases be construed as a whole according to its fair meaning and not
strictly for nor against any party. The Section headings contained in this
Agreement are for reference purposes only and will not affect in any way the
meaning or interpretation of this Agreement. All terms used in one number or
gender shall be construed to include any other number or gender as the context
may require. The parties agree that each party has reviewed this Agreement and
has had the opportunity to have counsel review the same and that any rule of
construction to the effect that ambiguities are to be resolved against the
drafting party shall not apply in the interpretation of this Agreement or any
amendment or any exhibits thereof.
9. Non-eligibility of Employee's Rights and Company Assignment Rights.
The obligations, rights and benefits of Employee hereunder are personal and may
not be delegated, assigned or transferred in any manner whatsoever, nor are
such obligations, rights or benefits subject to involuntary alienation,
assignment or transfer. Upon reasonable notice to Employee, Company may
transfer Employee to an affiliate of Company, which affiliate shall assume the
obligations of Company under this Agreement. This Agreement shall be assigned
automatically to any entity merging with or acquiring Company or its business.
10. Assignment. This Agreement and the respective rights, duties and
obligations of Employee hereunder may not be assigned or delegated by Employee.
11. Severability. In the event any term or provision of this Agreement is
declared by a court of competent jurisdiction to be invalid or unenforceable
for any reason, this Agreement shall remain in full force and effect, and
either (a) the invalid or unenforceable provision shall be modified to the
minimum extent necessary to make it valid and enforceable or (b) if such a
modification is not possible, this Agreement shall be interpreted as if such
invalid or unenforceable provision were not a part hereof.
12. Attorney's Fees. Except as otherwise provided herein, in the event any
party hereto institutes an action or other proceeding to enforce any rights
arising out of this Agreement, the party prevailing in such action or other
proceeding shall be paid all reasonable costs and attorneys' fees by the
non-prevailing party, such fees to be set forth by the court and not by a jury
and to be included in any judgment entered in such proceeding.
13. Consideration. It is expressly understood and agreed that this document
sets forth the entire consideration for this Agreement, and that said
consideration for this Agreement is contractual and not a mere recital.
14. Construction. This Agreement is a negotiated agreement and any documents
delivered pursuant hereto shall be construed without regard to the identity of
the persons or entities who or which drafted the various provisions thereof.
Every provision of this Agreement and such other employment-related documents
shall be construed as though all parties participated equally in the drafting
thereof. Any legal rule of construction that a document is to be construed
against the drafting party shall not be applicable and is expressly waived by
Company and Employee.
15. Counterparts. This Agreement may be executed in any number of
counterparts, all such counterparts shall be deemed to constitute one and the
same instrument, and each of said counterparts shall be deemed an original
hereof.
16. Captions. The captions used in this Agreement are inserted for convenience
only and shall not affect the meaning or construction of this Agreement.
17. Notices. All notices required or permitted hereunder shall be in writing
and shall be deemed duly given upon receipt if either personally delivered,
sent by certified mail, return receipt requested, or sent by a
nationally-recognized overnight courier service, addressed to the parties as
follows:
If to Company: SunnComm, Inc.
668 N. 44th Street, Suite 220
Phoenix, Arizona 85008
Attn: General Counsel
If to Employee: William Howard Whitmore, Jr.
9098 E. Ludlow Drive
Scottsdale, AZ 85260
480-661-5845
or to such other address as any party may provide to the other in accordance
with this Section.
18. Entire Agreement. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof (i.e., Employee's
employment by Company) and supersedes all prior or contemporaneous
understandings or agreements in regard thereto; provided, however, that (except
as otherwise set forth herein) this Agreement shall not affect or supersede any
rights of Company under any other contracts or other agreements between or
otherwise involving the parties, any restrictive covenants or any similar
agreements. No modification or addition to this Agreement shall be valid unless
in writing, specifically referring to this Agreement and signed by all parties
hereto. No waiver of any rights under this Agreement shall be valid unless in
writing and signed by the party to be charged with such waiver. No waiver of
any term or condition contained in this Agreement shall be deemed or construed
as a further or continuing waiver of such term or condition contained in this
Agreement shall be deemed or construed as a further or continuing waiver of
such term or condition, unless the waiver specifically provides otherwise.
IN WITNESS WHEREOF, the parties have executed this Agreement on the _26
th_ day of January , 2001.
SUNNCOMM, INC., EMPLOYEE:
a Nevada corporation
By: ____________________________ ____________________________
Peter H. Jacobs, President William Howard Whitmore, Jr.