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Employment Agreement - THINK New Ideas Inc. and James Grannan

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                              EMPLOYMENT AGREEMENT
                                        
     THIS EMPLOYMENT AGREEMENT (the "Agreement") is entered into as of this 30th
day of June 1996, between Think New Ideas, Inc., a Delaware corporation (the
"Company"), and James Grannan, an individual resident of Atlanta, Georgia (the
"Employee").

                                  WITNESSETH:

     WHEREAS, it is the desire of the Company to offer the Employee employment
with the Company upon the terms and subject to the conditions set forth herein;
and

     WHEREAS, it is the desire of the Employee to accept the Company's offer of
employment with the Company upon the terms and subject to the conditions set
forth herein.

     NOW THEREFORE, in consideration of the premises and mutual covenants,
conditions and agreements contained herein and for such other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, each intending to be legally bound hereby, agree as follows:

1.   Employment.  The Company hereby agrees to employ the Employee and the
     ----------                                                           
Employee hereby agrees to be employed by the Company upon the terms and subject
to the conditions set forth herein for the period of employment as set forth in
Section 2 hereof (the "Period of Employment").

2.   Term; Period of Employment.  Subject to extension or termination as
     --------------------------                                         
hereinafter provided, the Period of Employment hereunder shall be from the date
hereof (the "Effective Date") through the first anniversary of the Effective
Date.  Thereafter, the Period of Employment may be extended for successive one
(1) year periods at the option of the Company upon delivery of written notice by
the Company to the Employee, subject to acceptance by the Employee, not less
than one (1) month prior to the expiration of the Period of Employment, as
previously extended.  The phrase "Period of Employment" as used herein shall,
unless otherwise indicated:  (a) specifically include any extensions permitted
hereunder or provided herein, except as otherwise noted; and (b) be deemed to
have terminated as of the date of any notice provided to the Employee pursuant
to Section 9 hereof, notwithstanding the Company's obligation to pay the
Employee pursuant to Subsections 9(b) and 9(c) hereof.

3.   Office and Duties.  During the Period of Employment:
     -----------------                                   

     (a) the Employee shall be employed as a vice president of the Company as
set forth in the bylaws of the Company (the "Bylaws") with the responsibilities
reasonably prescribed for such position by the board of directors of the Company
(the "Board of Directors") in accordance with the Bylaws; and

     (b) the Employee shall devote substantially all of his time to the business
and affairs of the Company except for vacations, illness or incapacity, as
hereinafter set forth.  Notwithstanding the preceding sentence, nothing in this
Agreement shall preclude the Employee from devoting reasonable amounts of time:
<PAGE>
 
          (i) for serving as a director, officer or member of a committee of any
organization or entity involving no conflict of interest with the Company; or

          (ii) engaging in charitable and community activities;

provided, however, that such activities do not interfere with the performance by
--------  -------                                                               
the Employee of his duties hereunder.  In consideration of such employment, the
Employee agrees that he shall not, directly or indirectly, individually or as a
member of any partnership or joint venture, or as an officer, director,
stockholder, employee or agent of any other person, firm, corporation, business
organization or other entity, engage in any trade or business activity or
pursuit for his own account or for, or on behalf of, any other person, firm,
corporation, business organization or other entity, irrespective of whether the
same competes, conflicts or interferes with that of the Company or the
performance of the Employee's obligations hereunder; provided, however, that
                                                     --------  -------      
nothing contained herein shall be construed to prevent the Employee from:  (x)
investing in the stock of any corporation, which does not compete with the
Company, which is listed on a national securities exchange or traded in the
over-the-counter market if the Employee does not and will not as a result of
such investment own more than five percent (5%) of the stock of such corporation
("Permitted Investments"); or (y) engaging in personal business ventures to
which the Employee devotes time outside of the time required to be devoted to
the business of the Company hereunder.  The Employee represents and warrants
that he is not party to any agreement, oral or written, which restricts in any
way:  (a) his ability to perform his obligations hereunder; or (b) his right to
compete with a previous employer or such employer's business.

     (c) the Employee shall be entitled to vacation time based upon the
cumulative number of years the Employee is or has been employed by the Company
(deemed for this purpose to include a predecessor, successor, subsidiary or
other affiliate of the Company) as follows:


 
          Weeks of Vacation        Full Years of Service     
          -----------------    ------------------------------
                                                       
               Two (2)         One (1) through Six (6)       
                                                             
               Three (3)       Seven (7) through Nine (9)    
                                                             
               Four (4)        Ten (10) through Fourteen (14)
                                                             
               Five (5)        Fifteen (15) and Beyond        


provided, however, that no employee of the Company shall be entitled to take
--------  -------                                                           
more than two weeks consecutively of vacation time at any one time.

4.   Compensation and Benefits.  In exchange for the services rendered by the
     -------------------------                                               
Employee pursuant hereto in any capacity during the Period of Employment,
including without limitation, services as an officer, director, or member of any
committee of the Company or any affiliate, subsidiary or division thereof, the
Employee shall be compensated as follows:

     (a) Compensation.  The Company shall pay the Employee compensation equal to
         ------------                                                           
at least One Hundred Twenty-Five Thousand Dollars ($125,000) per annum at a rate
of Ten Thousand Four Hundred Sixteen Dollars and Sixty-Seven Cents ($10,416.67)
per month (such monthly amount as the same may be increased from time to time by
virtue of the adjustments set forth hereinbelow shall be defined as

                                       2
<PAGE>
 
the "Monthly Compensation").  Such salary shall be payable in accordance with
the customary payroll practices of the Company.

     (b) Profitability Bonus.  The Company may pay the Employee a bonus if, in
         -------------------                                                  
the sole judgment of the Board of Directors, the earnings of the Company or the
services of the Employee merit such a bonus.

     (c) Withholding and Employment Tax.  Payment of all compensation hereunder
         ------------------------------                                        
shall be subject to customary withholding tax and other employment taxes as may
be required with respect to compensation paid by an employer/corporation to an
employee.

5.   Business Expenses.  The Company shall:  (a) pay or reimburse the Employee
     -----------------                                                        
for all reasonable travel or other expenses incurred by the Employee in
connection with the performance of his duties under this Agreement, provided
that the same are previously authorized by the Company, in accordance with such
procedures as the Company may from time to time establish for employees and as
required to preserve any deductions for federal income taxation purposes to
which the Company may be entitled; and (b) pay the Employee $600 per month as an
automobile allowance, which amount shall include all expenses related to
maintenance of such an automobile and necessary repairs, registration, insurance
and fuel.

6.   Disability.  The Company shall provide the Employee with substantially the
     ----------                                                                
same disability insurance benefits as those, if any, currently being provided by
the Company, if any, for similar employees.

7.   Death.  The Company shall provide the Employee with substantially the same
     -----                                                                     
life insurance benefits as those currently being provided by the Company for
similar employees.  In the event of the Employee's death, the obligation of the
Company to make payments pursuant to Section 4 hereof shall cease as of the date
of such Employee's death and the Company shall pay to the estate of the Employee
any amount due to the Employee under Section 4 which has accrued up to the date
of death.

8.   Other Benefits.  The Employee shall be entitled to participate in fringe
     --------------                                                          
benefit, deferred compensation and stock option plans or programs of the
Company, if any, to the extent that his position, tenure, salary, age, health
and other qualifications make him eligible to participate, subject to the rules
and regulations applicable thereto.  Such additional benefits shall include, but
not be limited to, paid sick leave and individual health insurance, all in
accordance with the policies of the Company.  Except as specifically set forth
herein, the terms of, and participation by the Employee in, any deferred
compensation plan or program shall be determined by the Board of Directors in
its sole discretion.

9.   Termination of Employment.  Notwithstanding any other provision of this
     -------------------------                                              
Agreement, employment hereunder may be terminated:

     (a) By the Company, in the event of the employee's death or Disability or
for "Just Cause." "Just Cause" shall be defined to be limited to:  (i) the
Employee's indictment or conviction of a crime involving a felonious act or
acts, including dishonesty, fraud or moral turpitude by the Employee; and (ii)
"cause" as the same is construed for employment purposes under the laws of the
State of Delaware. The Employee shall be deemed to have a "Disability" for
purposes of this Agreement if he is unable to perform, by reason of physical or
mental incapacity, a material portion of his duties or obligations

                                       3
<PAGE>
 
under this Agreement for a period of thirty (30) consecutive days in any 365-day
period. The Board of Directors shall determine whether and when the Disability
of the Employee has occurred and such determination shall not be arbitrary or
unreasonable. The Company shall by written notice to the Employee given within
thirty (30) days after discovery of the occurrence of an event or circumstance
which constitutes "Just Cause," specify the event or circumstance giving rise to
the Company's exercise of its right hereunder and, with respect to Just Cause
arising under Section 9(a)(i), the Employee's employment hereunder shall be
deemed terminated as of the date of such notice; with respect to Just Cause
arising under Section 9(a)(ii), the Company shall provide the Employee with
thirty (30) days written notice of such violation and the Employee shall be
given reasonable opportunity during such thirty (30) day period to cure the
subject violation;

     (b) By the Company, in its sole and absolute discretion, provided that in
such event the Company shall, as liquidated damages or severance pay, or both,
pay the Employee an amount equal to the Employee's then Monthly Compensation (as
defined in Section 4(a) hereof) multiplied by three (3); or

     (c) By the Employee, upon any material violation of any material provision
of this Agreement by the Company, which violation remains unremedied for a
period of thirty (30) days after written notice of the same is delivered to the
Company by the Employee, provided that in such event, the Company shall, as
                         -------- ----                                     
liquidated damages or severance pay, or both, pay to the Employee an amount
equal to the Employee's Monthly Compensation multiplied by three (3).

     Nothing set forth in this section shall:  (i) require the Employee in the
event of termination pursuant to Subsections 9(b) or 9(c) above to mitigate
damages during the period in which the Employee is receiving payment thereunder
(the "Severance Period"); or (ii) entitle the Company to offset the amounts owed
by the Company to the Employee pursuant to Subsections 9(b) or 9(c) by any
income or compensation received by the Employee from sources other than the
Company during such Severance Period.  In addition, the Company shall not be
entitled to withhold or otherwise offset any amounts payable to the Employee
under Subsections 9(b) or 9(c) above in response to an alleged violation by the
Employee of any of the obligations which are imposed under this Agreement and
survive termination hereof until such time as court of competent jurisdiction or
other appropriate governing body has rendered judgment or otherwise made a
determination with respect to whether such violation has occurred.

10.  Non-Competition.  Notwithstanding any earlier termination, during the
     ---------------                                                      
Period of Employment and for one (1) year thereafter:

     (a) the Employee shall not, anywhere in North America or in any other place
or venue where the Company or any affiliate, subsidiary or division thereof now
conducts or operates, or may conduct or operate its business in the future but
prior to the date of termination hereunder, directly or indirectly, individually
or as a member of any partnership or joint venture, or as an officer, director,
stockholder, employee or agent of any other person, firm, corporation, business
organization or other entity, participate in, engage in, solicit or have any
financial or other interest in any activity or any business or other enterprise
in the field of advertising, marketing, interactive Internet solutions or in any
other field which is or may be reasonably expected to become competitive with
the current or contemplated business of the Company or any affiliate, subsidiary
or division thereof (unless the Board of Directors shall have authorized such
activity and the Company shall have consented thereto in writing), as an

                                       4
<PAGE>
 
individual or as a member of any partnership or joint venture, or as an officer,
director, stockholder, investor, employee or agent of any other person, firm,
corporation, business organization or other entity; provided, however, that
                                                    --------  -------
nothing contained herein shall be construed to prevent the employee from
investing in Permitted Investments; and

     (b) the Employee shall not:  (i) solicit or induce any employee of the
Company to terminate his employment or otherwise leave the Company's employ or
hire any such employee (unless the Board of Directors shall have authorized such
employment and the Company shall have consented thereto in writing); or (ii)
contact or solicit any clients or customers of the Company, either as an
individual or as a member of any partnership or joint venture, or as an officer,
director, stockholder, investor, employee or agent of any other person, firm,
corporation, business organization or other entity.

11.  Confidential Information.  The parties hereto recognize that it is
     ------------------------                                          
fundamental to the business and operation of the Company, its affiliates,
subsidiaries and divisions thereof to preserve the specialized knowledge, trade
secrets, and confidential information of the foregoing concerning the field of
advertising, marketing and interactive Internet solutions.  The strength and
good will of the Company is derived from the specialized knowledge, trade
secrets, and confidential information generated from experience through the
activities undertaken by the Company, its affiliates, subsidiaries and divisions
thereof.  The disclosure of any of such information and the knowledge thereof on
the part of competitors would be beneficial to such competitors and detrimental
to the Company, its affiliates, subsidiaries and divisions thereof, as would the
disclosure of information about the marketing practices, pricing practices,
costs, profit margins, design specifications, analytical techniques, concepts,
ideas, process developments (whether or not patentable), customer and client
agreements, vendor and supplier agreements and similar items or technologies.
By reason of his being an employee of the Company, in the course of his
employment, the Employee has or shall have access to, and has obtained or shall
obtain, specialized knowledge, trade secrets and confidential information such
as that described herein about the business and operation of the Company, its
affiliates, subsidiaries and divisions thereof. Therefore, the Employee hereby
agrees as follows, recognizing and acknowledging that the Company is relying on
the following in entering into this Agreement:

     (a) The Employee hereby sells, transfers and assigns to the Company, or to
any person or entity designated by the Company, any and all right, title and
interest of the Employee in and to all creations, designs, inventions, ideas,
disclosures and improvements, whether patented or unpatented, and copyrightable
material, made or conceived by the Employee solely or jointly, in whole or in
part, during or before the term hereof (commencing with the date of the
Employee's employment with the Company) which:  (i) relate to methods,
apparatus, designs, products, processes or devices created, promoted, marketed,
distributed, sold, leased, used, developed, relied upon or otherwise provided by
the Company or any affiliate, subsidiary or division thereof; or (ii) otherwise
relate to or pertain to the business, operations or affairs of the Company or
any affiliate, subsidiary or division thereof.  Whether during the Period of
Employment or thereafter, the Employee shall execute and deliver to the Company
such formal transfers and assignments and such other papers and documents as may
be required of the Employee to permit the Company or any person or entity
designated by the Company to file, enforce and prosecute the patent applications
relating to any of the foregoing and, as to copyrightable material, to obtain
copyright thereon; and

     (b) Notwithstanding any earlier termination, during the Period of
Employment and for a period of one (1) year thereafter, the Employee shall,
except as otherwise required by or compelled by 

                                       5
<PAGE>
 
law, keep secret and retain in strict confidence, and shall not use, disclose to
others, or publish any information, other than information which is in the
public domain or becomes publicly available through no wrongful act on the part
of the Employee, which information shall be deemed not to be confidential
information, relating to the business, operation or other affairs of the
Company, its affiliates, subsidiaries and divisions thereof, including but not
limited to confidential information concerning the design and marketing
practices, pricing practices, costs, profit margins, products, methods,
guidelines, procedures, engineering designs and standards, design
specifications, analytical techniques, technical information, customer, client,
vendor or supplier information, employee information, and any and all other
confidential information acquired by him in the course of his past or future
services for the Company or any affiliate, subsidiary or division thereof. The
Employee shall hold as the Company's property all notes, memoranda, books,
records, papers, letters, formulas and other data and all copies thereof and
therefrom in any way relating to the business, operation or other affairs of the
Company, its affiliates, subsidiaries and divisions thereof, whether made by him
or otherwise coming into his possession. Upon termination of his employment or
upon the demand of the Company, at any time, the Employee shall deliver the same
to the Company within twenty-four (24) hours of such termination or demand.

12.  Reasonableness of Restrictions.  The Employee hereby agrees that the
     ------------------------------                                      
restrictions in this Agreement, including without limitation, those relating to
the duration of the provisions hereof and the territory to which such
restrictions apply, are necessary and fundamental to the protection of the
business and operation of the Company, its affiliates, subsidiaries and
divisions thereof, and are reasonable and valid.

13.  Reformation of Certain Provisions.  In the event that a court of competent
     ---------------------------------                                         
jurisdiction determines that the non-compete or the confidentiality provisions
hereof are unreasonably broad or otherwise unenforceable because of the length
of their respective terms or the breadth of their territorial scope, or for any
other reason, the parties hereto agree that such court may reform the terms
and/or scope of such covenants so that the same are reasonable and, as reformed,
shall be enforceable.

14.  Remedies.  Subject to Section 15 below, in the event of a breach of any of
     --------                                                                  
the provisions of this Agreement, the non-breaching party shall provide written
notice of such breach to the breaching party. The breaching party shall have
thirty (30) days after receipt of such notice in which to cure its breach. If,
on the thirty-first (31st) day after receipt of such notice, the breaching party
shall have failed to cure such breach, the non-breaching party thereafter shall
be entitled to seek damages.  It is acknowledged that this Agreement is of a
unique nature and of extraordinary value and of such a character that a breach
hereof by the Employee shall result in irreparable damage and injury to the
Company for which the Company may not have any adequate remedy at law.
Therefore, if, on the thirty-first (31st) day after receipt of such notice, the
breaching party shall have failed to cure such breach, the non-breaching party
shall also be entitled to seek a decree of specific performance against the
breaching party, or such other relief by way of restraining order, injunction or
otherwise as may be appropriate to ensure compliance with this Agreement.  The
remedies provided by this section are non-exclusive and the pursuit of such
remedies shall not in any way limit any other remedy available to the parties
with respect to this Agreement, including, without limitation, any remedy
available at law or equity with respect to any anticipatory or threatened breach
of the provisions hereof.

15.  Certain Provisions; Specific Performance.  In the event of a breach by the
     ----------------------------------------                                  
Employee of the non-competition or confidentiality provisions hereof, such
breach shall not be subject to the cure 

                                       6
<PAGE>
 
provision of Section 14 above and the Company shall be entitled to seek
immediate injunctive relief and a decree of specific performance against the
Employee. Such remedy is non-exclusive and shall be in addition to any other
remedy to which the Company or any affiliate, subsidiary or division thereof may
be entitled.

16.  Consolidation; Merger; Sale of Assets.  Nothing in this Agreement shall
     -------------------------------------                                  
preclude the Company from combining, consolidating or merging with or into,
transferring all or substantially all of its assets to, or entering into a
partnership or joint venture with, another corporation or other entity, or
effecting any other kind of corporate combination, provided that, the
corporation resulting from or surviving such combination, consolidation or
merger, or to which such assets are transferred, or such partnership or joint
venture assumes this Agreement and all obligations and  undertakings of the
Company hereunder. Upon such a consolidation, merger, transfer of assets or
formation of such partnership or joint venture, this Agreement shall inure to
the benefit of, be assumed by, and be binding upon such resulting or surviving
transferee corporation or such partnership or joint venture, and the term
"Company," as used in this Agreement, shall mean such corporation, partnership
or joint venture, or other entity and this Agreement shall continue in full
force and effect and shall entitle the Employee and his heirs, beneficiaries and
representatives to exactly the same compensation, benefits, perquisites,
payments and other rights as would have been their entitlement had such
combination, consolidation, merger, transfer of assets or formation of such
partnership or joint venture not occurred.

17.  Survival.  Sections 10 through 15 shall survive the termination for any
     --------                                                               
reason of this Agreement (whether such termination is by the Company, by the
Employee, upon the expiration of this Agreement by its terms or otherwise);
provided, however, that in the event that the Company ceases to exist and
--------  -------                                                        
neither an affiliate, subsidiary or division thereof has assumed, at its option,
the obligations of the Company hereunder, the Employee shall no longer be bound
by the Non-Competition provision set forth in Section 10 hereof.

18.  Severability.  The provisions of this Agreement shall be considered
     ------------                                                       
severable in the event that any of such provisions are held by a court of
competent jurisdiction to be invalid, void or otherwise unenforceable.  Such
invalid, void or otherwise unenforceable provisions shall be automatically
replaced by other provisions which are valid and enforceable and which are as
similar as possible in term and intent to those provisions deemed to be invalid,
void or otherwise unenforceable.  Notwithstanding the foregoing, the remaining
provisions hereof shall remain enforceable to the fullest extent permitted by
law.

19.  Entire Agreement; Amendment.  This Agreement contains the entire agreement
     ---------------------------                                               
between the Company and the Employee with respect to the subject matter hereof
and thereof.  This Agreement may not be amended, changed, modified or
discharged, nor may any provision hereof be waived, except by an instrument in
writing executed by or on behalf of the party against whom enforcement of any
amendment, waiver, change, modification or discharge is sought.  No course of
conduct or dealing shall be construed to modify, amend or otherwise affect any
of the provisions hereof.

20.  Notices.  All notices, request, demands and other communications hereunder
     -------                                                                   
shall be in writing and shall be deemed to have been duly given if physically
delivered, delivered by express mail or other expedited service or upon receipt
if mailed, postage prepaid, via first class mail as follows:

                                       7
<PAGE>
 
     (a)  To the Company:           Think New Ideas, Inc.
                                      8522 National Boulevard, Suite 101
                                      Culver City, California 90232
                                      Attention:  President

     (b)  To the Employee:          Mr. James Grannan
                                      c/o Creative Resources Agency, Inc.
                                      3110.5 Roswell Road, N.W.
                                      Atlanta, Georgia  30305

     (c)  With an additional copy
               by like means to:      De Martino Finkelstein Rosen & Virga
                                      1818 N Street, N.W., Suite 400
                                      Washington, D.C.  20036
                                      Attn:  Ralph V. De Martino, Esq.

and/or to such other persons and addresses as any party hereto shall have
specified in writing to the other.

21.  Assignability.  This Agreement shall not be assignable by the Employee, but
     -------------                                                              
shall be binding upon and shall inure to the benefit of his heirs, executors,
administrators and legal representatives.  This Agreement shall be assignable by
the Company to any affiliate, subsidiary or division thereof and to any
successor in interest.

22.  Governing Law.  This Agreement shall be governed by and construed under the
     -------------                                                              
laws of the State of Delaware, without regard to the principles of conflicts of
laws thereof.

23.  Waiver and Further Agreement.  Any waiver of any breach of any terms or
     ----------------------------                                           
conditions of this Agreement shall not operate as a waiver of any other breach
of such terms or conditions or any other term or condition hereof, nor shall any
failure to enforce any provision hereof operate as a waiver of such provision or
of any other provision hereof.  Each of the  parties hereto agrees to execute
all such further instruments and documents and to take all such further action
as the other party may reasonably require in order to effectuate the terms and
purposes of this Agreement.

24.  Headings of No Effect.  The headings contained in this Agreement are for
     ---------------------                                                   
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.

                                       8
<PAGE>
 
     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.

                              THINK NEW IDEAS, INC., the Company


                              By:   /s/ Scott Mednick
                                    --------------------------------------
                                    Scott Mednick, Chief Executive Officer


                              THE EMPLOYEE


                              By:   /s/ James Grannan
                                    --------------------------------------
                                    James Grannan

                                       9