Exhibit 10.1
EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT
AGREEMENT (the
“Agreement”) made as of the 5th day of September, 2007
(“Effective Date”).
BETWEEN:
IA Global, Inc.
101 California Street, Suite
2450
San Francisco, CA 94111
and its successor
entities
(the
“Company”)
AND:
Derek Schneideman
____________________
____________________
(the
“Executive”)
WHEREAS:
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A.
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The Company has offered employment
to the Executive;
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B.
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The Executive has accepted such
offer of employment;
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C.
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The Executive shall begin his
employment on September 5, 2007 (“Start Date”);
and
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D.
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The Executive is to be primarily
based in Tokyo, Japan.
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NOW THEREFORE THIS AGREEMENT
WITNESSES that in
consideration of the promises and mutual agreements contained
herein the parties hereto agree as follows:
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1.1
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The Executive shall be employed by
the Company as Chief Executive Officer and Chairman of the Board
and shall have such responsibilities, duties and authority as are
generally associated with each such office and such other authority
as may from time to time be assigned to the Executive by the
Company’s Board of Directors (the “Board”)
including, but not limited to, responsibility for the overall
strategic business plan and day-to-day operations of the Company
across all functional areas on a worldwide basis
(“Duties”). The Executive shall be primarily based at
the Company’s offices in Tokyo, Japan. The Executive shall,
at all times during the Term, report directly to the Board of
Directors.
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1.2
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The Executive shall perform the
Duties diligently and faithfully. The Executive shall devote
substantially all of his working time, attention and effort to the
performance of the Duties for the Company and shall not undertake
any other
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employment or business association
which requires the rendering of personal services without the prior
written consent of the Company. Notwithstanding the foregoing
provisions of this Paragraph 1.2, the Executive may devote
reasonable time to activities, other than those required under this
Agreement, including activities involving professional, charitable,
community, educational, religious and similar types of
organizations, speaking engagements, membership on the boards of
directors of other organizations, and other similar types of
activities, to the extent that such other activities do not
materially inhibit or prohibit the Executive from performing his
Duties under this Agreement, or conflict in any material way with
the business of the Company.
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1.3
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The Executive shall at all times
well and faithfully serve the Company and devote his or her best
effort and skill to his position with the Company and to promote
the business and interests of the Company.
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2.
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Compensation and
Benefits
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2.1
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Signing Bonus
. Upon the execution of this
Agreement, the Executive shall be paid a Signing Bonus of $0,
payable by wire transfer in immediately available funds to a bank
account designated by the Executive. The Company shall pay the
Signing Bonus to the Executive no later than ten (10) business days
following the execution of this Agreement. The Signing Bonus shall
be in addition to the annual Base Salary set forth
below.
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2.2
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Salary . The Company shall pay the Executive the base
salary of TWO HUNDRED AND FIFTY THOUSAND AND NO/100 DOLLARS
(US$250,000) per year (“Base Salary”) in accordance
with the Company’s usual payroll schedule. All payments made
to the Executive by the Company will be subject to normal employee
withholdings and deductions.
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2.3
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Benefits . During the Term, the Company shall make
available those benefits to the Executive that are available to
senior executives of the Company, which shall include family
medical insurance, term life insurance, term disability insurance,
dental insurance, a Simple IRA, and annual travel policy (including
medical for international travel). Such benefits shall be made
available subject to and on a basis consistent with the terms,
conditions (including the cost of the benefits to the Executive)
and overall administration of such plans and arrangements and the
Company’s practices with respect to such plans.
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(a) The
Executive shall be eligible to receive bonuses during the Term
(each, a “Bonus”) provided certain requirements are
satisfied. In order to receive each Bonus, the Executive must (i)
meet certain performance goals and objectives and (ii) be
continuously employed by the Company from the date the Bonus terms
are established by the Board through the date the Board determines
whether the applicable performance goals are satisfied and the
Executive is entitled to
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payment of the Bonus (the
“Bonus Term”). The Executive and the Board shall agree
on the Executive’s performance goals and objectives prior to
the beginning of each Bonus Term. The amount of each Bonus, if any,
shall be determined by the Board based upon the Executive’s
performance against such goals and objectives for the relevant
Bonus Term, as determined in good faith by the Board. For the
Initial Term, the Executive’s Bonus will be based on
performance criteria as set forth in Schedules A and B
hereto.
(b) Provided
the Executive remains continuously employed by the Company through
the end of the Bonus Term, as required by Paragraph 2.4(a), and the
Board has determined that the applicable performance goals have
been satisfied, notwithstanding anything herein to the contrary,
each Bonus shall be paid to the Executive in the form of a lump sum
within fifteen (15) days of the end of the Bonus Term, whether or
not the Executive is employed by the Company on the actual date of
payment.
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2.5
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Stock Options
. The Executive will be eligible to
be granted stock options under the Company’s stock option
plans.
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(a) The
Company shall reimburse the Executive for all reasonable business
expenses actually and properly incurred by the Executive during the
Term, in connection with taking up and performing the Duties,
provided that all such expenses are incurred and accounted for in
accordance with reasonable policies and procedures of the Company
as are in effect from time to time.
(b) The
Executive is to be provided an American Express Corporate credit
card to cover reasonable business expenses, which may include but
are not limited to travel, lodging, meals, gasoline and
entertainment. Reasonable and standard corporate expenses
include:
(i) Business
class airfares for flights above four hours or multiple flights in
combination above four hours; and
(ii) Hotels
while traveling on business (Marriott class or similar
style).
(c) All
reimbursements provided for in this Paragraph 2.6 shall be paid to
the Executive no later than thirty (30) days following the date the
Executive provides all required documentation and submits a request
with the Company for reimbursement, provided that no reimbursement
shall be paid later than the end of the year following the year in
which the Executive incurs the expense. The amount of expenses
eligible for reimbursement in any one year will not affect the
expenses eligible for reimbursement in any other year.
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2.7
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Vacation . The Executive shall be entitled to twenty five
(25) vacation days per year, plus ten (10) holidays and five (5)
days of paid sick leave per year, to accrue
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(except in the case of holidays) pro
rata on a daily basis beginning on the Start Date. Unused vacation
days will be carried over each year.
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3.1
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Subject to earlier termination as
provided in Sections 4 through 8 hereof, the initial employment
term of this Agreement shall be two (2) years beginning on the
Start Date (“Initial Term”). The Initial Term shall be
automatically extended, subject to earlier termination as provided
in Sections 4 through 8 hereof, for successive additional one (1)
year periods (the “Additional Term,” and together with
the Initial Term, the “Term”), unless, at least twelve
(12) months prior to the end of the Initial Term or the then
Additional Term, the Executive or the Company has notified the
other in writing that the Term shall terminate at the end of the
then current term.
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4.
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Termination of Employment by
the Company For Cause
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4.1
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The Company may terminate the
Executive’s employment at any time for Cause by providing
written notice to the Executive.
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4.2
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For this purpose, the term
“Cause” shall mean the following: (a) the
Executive’s performance of the Duties in a grossly negligent
manner, (b) the Executive’s repeated failure to perform the
Duties as the Company reasonably requires or to abide by the
Company’s polices and/or procedures for the operation of its
business and the continuation thereof after the receipt by the
Executive of written notice from the Company, (c) the
Executive’s willful and material breach of a provision of
this Agreement, or (d) actions or omissions by the Executive that
are criminal, fraudulent, or involve dishonesty, or constitute
intentional breach of fiduciary obligation or intentional
wrongdoing or malfeasance, and, in each instance, result in harm to
the operations or reputation of the Company; provided that no act
or failure to act shall be considered “willful” unless
it is done, or omitted to be done, by the Executive in bad faith or
without reasonable belief that his act or failure to act was in the
best interest of the Company; and provided further, that Cause
shall not include any actions taken by the Executive on behalf of
or at the direction of any controlling shareholder or shareholder
groups (as such terms are used under the US Federal securities
laws) or any refusal by Executive to take any actions on behalf of
such shareholder or shareholder group. Before terminating the
Executive’s employment for Cause, the Company shall provide
notice to the Executive of the Company’s intention to
terminate the Executive’s employment for Cause and the
specific grounds for such termination. The Company will give the
Executive ten (10) business days to cure the event constituting
Cause (if such is curable, in the sole discretion of the Board) and
will not terminate the Executive’s employment if the
Executive affects such cure during that time.
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4.3
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In the event that the Executive
incurs a Separation from Service (within the meaning of Section
409A of the Internal Revenue Code of 1986, as amended
(the
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“Code”)) with the
Company on account of the Company’s involuntary termination
of the Executive’s employment for Cause, the Company shall
pay the Executive any earned but unpaid Base Salary, and accrued
and unused vacation days, in accordance with the Company’s
customary payroll practices and vacation plan, provided, however,
that such payments shall in no event be made later than thirty (30)
days following the Executive’s Separation from Service or, if
earlier, the latest time permitted by applicable law. The
Executive’s business expenses incurred through the date of
the Executive’s Separation from Service shall be reimbursed
pursuant to Paragraph 2.6 hereof.
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4.4
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In the event that the Executive
incurs a Separation from Service with the Company on account of the
Company’s involuntary termination of the Executive’s
employment for Cause, and the Company satisfies its obligations
under Section 4 hereof, the Company shall have no further
obligation or liability to the Executive, except as provided under
Paragraph 2.4(b) hereof.
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5.
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Termination of Employment by
the Company Without Cause
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5.1
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The Company may involuntarily
terminate the Executive’s employment without Cause at any
time and for any reason, or no reason whatsoever, upon thirty (30)
days written notice to the Executive.
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5.2
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In the event that the Executive
incurs a Separation from Service with the Company on account of the
Company’s involuntary termination of the Executive’s
employment without Cause, the Company shall pay the Executive any
earned but unpaid Base Salary, and accrued and unused vacation
days, in accordance with the Company’s customary payroll
practices and vacation plan, provided, however, that such payments
shall in no event be made later than thirty (30) days following the
Executive’s Separation from Service or, if earlier, the
latest time permitted by applicable law. The Executive’s
business expenses incurred through the date of the
Executive’s Separation from Service shall be reimbursed
pursuant to Paragraph 2.6 hereof.
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5.3
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In the event that the Executive
incurs a Separation from Service with the Company on account of the
Company’s involuntary termination of the Executive’s
employment without Cause, the Company shall, in addition to the
payment set forth in Paragraph 5.2:
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(a) Pay
the Executive an amount equivalent to one (1) year’s then
applicable Base Salary; and
(b) Cause
any unexpired options granted to the Executive under Paragraph 2.5
to vest immediately.
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5.4
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As a prerequisite to receiving any
of the payments and benefits provided for in Section 5.3, the
Executive shall be required to sign a “Waiver and Release of
All Claims,” in a form acceptable to Company. No payment or
benefit shall be provided under Section 5.3 unless such Waiver and
Release of All Claims has
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been signed and become irrevocable
within 60 days of the Executive’s Separation from Service
(the “Release Effective Date”).
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5.5
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The additional payment provided in
Paragraph 5.3(a) shall be paid to the Executive in the form of a
lump sum no later than (i) seventy (70) days following the
Executive’s Separation from Service and (ii) ten (10) days
following the Release Effective Date. In the event that the
Executive incurs a Separation from Service with the Company in 2007
on account of the Company’s involuntary termination of the
Executive’s employment without Cause, one-half of the
additional payment provided in Paragraph 5.3(a) shall be paid in
the form of a lump sum immediately upon the Executive’s
Separation from Service and the provisions of Paragraph 5.4 shall
not apply to such payment. The balance of the payment due under
5.3(a) shall be made in accordance with the terms of Paragraph 5.4
and the first sentence of this Paragraph 5.5.
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5.6
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In the event that the Executive
incurs a Separation from Service with the Company on account of the
Company’s involuntary termination of the Executive’s
employment without Cause, and the Company satisfies its obligations
under Section 5 hereof, the Company shall have no further
obligation or liability to the Executive, except as provided under
Paragraph 2.4(b) hereof.
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6.
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Termination of Employment by
the Executive
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6.1
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The Executive may terminate his
employment with the Company at any time for any reason by providing
not less than twelve (12) months written notice to the
Company.
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6.2
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In the event that the Executive
incurs a Separation from Service with the Company on account of the
Executive’s termination of his employment with the Company,
the Company shall pay the Executive any earned but unpaid Base
Salary, and accrued and unused vacation days, in accordance with
the Company’s customary payroll practices and vacation plan,
provided, however, that such payments shall in no event be made
later than thirty (30) days following the Executive’s
Separation from Service or, if earlier, the latest time permitted
by applicable law. The Executive’s business expenses incurred
through the date of the Executive’s Separation from Service
shall be reimbursed pursuant to Paragraph 2.6 hereof. Subject to
Paragraph 2.4(b), the Company shall have no further liability or
obligation to the Executive.
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6.3
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In the event that the Executive
incurs a Separation from Service with the Company on account of the
Executive’s termination of his employment with the Company,
and the Company satisfies its obligations under Section 6 hereof,
the Company shall have no further obligation or liability to the
Executive, except as under Paragraph 2.4(b).
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7.
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Termination of Employment on
Account of the Executive’s Death or
Disability
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7.1
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Termination of Employment on
Account of Disability .
The Company shall have
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the right to involuntarily terminate
the Executive’s employment effective after the determination
that the Executive is unable to work due to a Disability. If the
Executive incurs a Separation from Service with the Company on
account of the Company’s termination of his employment for
Disability, then:
(a) The
Base Salary provided for in Paragraph 2.2 shall cease to accrue as
of the Executive’s Separation from Service;
(b) The
Company shall pay the Executive any earned, but unpaid Base Salary,
and accrued and unused vacation days, in accordance with the
Company’s customary payroll practices and vacation plan,
provided, however, that such payments shall in no event be made
later than thirty (30) days following the Executive’s
Separation from Service or, if earlier, the latest time permitted
by applicable law. The Executive’s business expenses incurred
through the date of the Executive’s Separation from Service
shall be reimbursed pursuant to Paragraph 2.6 hereof.
(c) At
the option of the Executive, the Executive and his dependents may
continue to participate in the benefit plans as described in
Paragraph 2.3 to the extent the Executive and his dependents are
eligible to participate in such benefit plans pursuant to the terms
of such benefit plans, and to the extent continuation in such
benefit plans does not violate Code Section 409A.
(d) In
the event that the Executive incurs a Separation from Service with
the Company on account of the Company’s termination of his
employment for Disability, and the Company satisfies its
obligations under Section 7 hereof, the Company shall have no
further obligation or liability to the Executive, except as under
Paragraph 2.4(b) hereof.
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7.2
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Disability
. For purposes of this Agreement,
“Disability” shall mean (i) the Executive has begun
receiving disability income insurance payments under any long-term
disability income insurance policy that the Company is then
maintaining for the benefit of the Executive, among others; or (ii)
a physical or mental disability, as determined by an independent
physician selected by the Company, that renders the Executive
incapable of performing his Duties under this Agreement for 180
days or more within any 365-day period, of which at least 90 days
are consecutive. The Company shall not involuntarily terminate the
Executive’s employment due to Disability as defined in clause
(ii) hereof prior to the first day following the 180-day period
described in such clause.
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7.3
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Termination of Employment because
of Death .
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(a) If
the Executive incurs a Separation from Service on account of his
death during the Term, the Company shall pay to the
Executive’s Beneficiary any earned but unpaid Base Salary,
and accrued and unused vacation days, in accordance with the
Company’s customary payroll practices and vacation plan,
provided, however, that such payments shall in no event be made
later than thirty (30) days following the Executive’s
Separation from Service or, if earlier, the
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latest time permitted by applicable
law. The Executive’s business expenses incurred through the
date of the Executive’s Separation from Service shall be
reimbursed pursuant to Paragraph 2.6 hereof and paid to the
Executive’s Beneficiary. The Executive’s dependents may
continue to participate in the benefit plans as described in
Paragraph 2.3 to the extent the Executive’s dependents
are
