This Employment Agreement (this
“ Agreement ”) is made and entered into on
March 11, 2009, but to be effective as of March 1, 2009
(the “ Effective Date ”), by and between Global
Traffic Network, Inc., a Nevada corporation with a business office
located at 880 Third Avenue, 6 th Floor, New York, NY 10022 (the “
Company ”), and Gary L. Worobow (the “
Employee ”).
A. The
Company desires to employ Employee as the Company’s Executive
Vice President, Business and Legal Affairs in accordance with the
terms and conditions of this Agreement, and wishes to obtain
reasonable protection against unfair competition from Employee
following termination of employment and to protect itself against
unfair competition and the use of its confidential business and
technical information.
B. Employee
wishes to provide services to the Company in exchange for
compensation and is willing to grant the Company the benefits of
the various covenants contained herein.
Now, Therefore, in consideration
of the foregoing facts, the mutual covenants set forth herein and
for other good and valuable consideration the receipt and
sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:
1.
Employment. The Company hereby employs Employee as the
Company’s Executive Vice President, Business and Legal
Affairs, and Employee hereby accepts such employment and agrees to
serve the Company to the best of his ability, promoting the
Company’s interests and business and devoting substantially
all of his business time, energy and skill to such
employment.
2. Duties
and Powers. During the Term (as defined below), and excluding
any periods of vacation, sick, disability or other leave to which
Employee may be entitled, Employee agrees to devote substantially
all of Employee’s business attention and time to the business
and affairs of the Company and, to the extent necessary to
discharge the responsibilities assigned to Employee pursuant hereto
and under the Company’s bylaws as amended from time to time,
to use Employee’s reasonable best efforts to perform
faithfully and efficiently such responsibilities. Also during the
Term, Employee shall not engage in any other business activity,
whether or not such business activity is pursued for gain, profit
or other pecuniary advantage, that will interfere with the
performance of Employee’s employment duties or that will
adversely affect, or reflect negatively upon, the Company. Employee
shall perform such duties under the direction of, and shall report
to, the Company’s Chief Executive Officer, President and
Board of Directors (the “Board”) or a committee
thereof. Employee shall comply with the Company’s policies
and procedures; provided, however , that to the extent such
policies and procedures are inconsistent with this Agreement, the
provisions of this Agreement shall control.
3.
Term. This Agreement, and Employee’s employment,
appointment and position hereunder shall be effective as of the
Effective Date. Subject to Section 16, this Agreement shall
continue through June 30, 2012, or until earlier terminated as
provided pursuant to Section 8 (such term is referred to
herein as the “Term”). Unless otherwise terminated
pursuant hereto, if Employee continues to be employed by the
Company after the Term, then this Agreement shall be deemed to
continue on a month-to-month basis until such time as
Employee’s employment is terminated pursuant to Section
8.
4.
Salary. . The Company shall pay Employee an initial
annualized salary of $250,000.00 per year through January 30,
2010. Employee’s annualized salary shall be subject to five
percent (5%) annual increases commencing February 1, 2010.
Payment of Employee’s salary shall be made in accordance with
the Company’s normal payroll business practices.
5.
Bonus . The Company shall pay Employee a one time bonus on
the Effective Date equal to $20,833.33. During the Term, Employee
shall be eligible to receive an annual performance-based bonus (the
“ Bonus ”) of up to 33 1/3 %
of his salary for each of the Company’s fiscal years,
commencing with the 2010 fiscal year. The amount of the Bonus, if
any, will be determined and paid based upon satisfaction of certain
operating profit goals to be determined by the Board or the
Compensation Committee thereof for the applicable fiscal year and
will be contingent upon Employee remaining an active employee of
the Company through the end of the applicable fiscal year. The
Bonus, if any, for any fiscal year will be paid not later than the
15 th
day of the third month after the end
of the calendar year in which the Bonus has been earned.
6. Other
Benefits . Employee shall be entitled to participate in or
receive benefits under any employee-benefit plan made available by
the Company in the future to its employees based in the United
States (including without limitation medical, dental and life
insurance benefits), subject to and on a basis consistent with the
terms, conditions and overall administration of such plans.
Nonetheless, in its sole discretion the Company may amend or
terminate any such employee-benefit plan providing benefits
generally to its employees. Employee shall be entitled to an
aggregate of four weeks of paid vacation in each calendar year.
Notwithstanding the foregoing, unless and until the Company elects
to provide its United States based employees (including Employee)
with medical insurance, the Company shall pay Employee $1,000 per
month in lieu providing Employee with such benefit.
7.
Reimbursement of Business Expenses . Upon presentation of
appropriate receipts and/or vouchers, the Company shall reimburse
Employee for bar dues, bar association membership dues, costs
associated compliance with continuing legal education
(CLE) requirements and other reasonable and necessary expenses
he incurs in connection with the performance of his duties, in
accordance with any and all Company’s policies and procedures
governing such expenses.
8.
Termination . Notwithstanding the term set forth in
Section 3 hereof, this Agreement may be earlier terminated as
set forth below:
(a) by the Company
without Cause (as defined below) upon 30 days written notice
to Employee;
(b) by the
Company, immediately upon written notice to Employee for the
following events, each of which would constitute “
Cause ”: (i) Employee is convicted of a felony;
(ii) Employee has materially breached this Agreement which
failure has not been cured by Employee after fifteen (15) days
written notice thereof to Employee by the Company; or
(iii) Employee’s habitual intoxication, drug use or
chemical substance abuse by any intoxicating or chemical
substance;
(c) by Employee in
the event (i) of a material breach of this Agreement by the
Company, or (ii) that Employee is required to report directly
to anyone other than the Company’s Chief Executive Officer,
President or the Board of Directors (or a committee thereof);
provided, however, that in either case: (x) Employee
has provided written notice to the Board of the
2
existence of
such breach within a period not to exceed ninety (90) days
following its initial occurrence; (y) the Company has failed
to cure such breach within a period of (30) days following the
Board’s receipt of such notice from Employee; and (z)
Employee terminates his employment with the Company within a period
of time not to exceed thirty (30) days following the
expiration of the Company’s cure period under subsection (y)
above.
(d) by Employee
voluntarily upon at least 30 days written notice to the
Company, specifying an effective date for such termination;
and
(e) upon the death
or disability of Employee. For the purposes of this Agreement,
Employee’s “ disability ” shall occur if
Employee shall become incapacitated by accident or illness and, in
the sole reasonable determination of the Board, shall be unable to
perform the duties of the positions he then occupies with
reasonable accommodation for a period of time of not less than 90
consecutive days, and the Company provides 30 days written
notice to the Employee at any time after such period of
disability.
In the event of
any termination occurring by virtue of paragraphs (a) through
(e) above, Employee shall be entitled to compensation and
benefits, if any, accrued through the effective date of
termination. Furthermore, if Employee’s employment is
terminated pursuant to paragraphs (a) or (c) above, he
shall continue to receive the salary payments specified in
Section 4 at his then current annualized salary and a $1,000
per month medical insurance reimbursement through June 30,
2012 (the “ Severance Payments ”).
If the Company
determines that it will not renew this Agreement or wishes to
terminate this Agreement after June 30, 2012, the Company
shall either provide Employee with notice of its intention four
months prior to the termination date of this Agreement or shall
continue to pay Employee’s then current annualized salary and
monthly medical insurance reimbursement for four months following
the termination of the Agreement.
Except as provided
in the following paragraph, the Company shall make all Severance
Payments due pursuant to this Section 8, and all payments made
pursuant to the preceding paragraph, at the times and in the manner
that Employee’s salary would have been paid but for the
termination of Employee’s employment and shall otherwise
comply with the requirements of Section 409A of the Internal
Revenue Code of 1986, as amended, and the Treasury Regulations
promulgated thereunder (“ Section 409A
”).
If, as of the date
Employee’s employment is terminated: (a) the
Company’s common stock is publicly traded (as determined
under Section 409A), (b) Employee is a “specified
employee” (as determined under Section 409A), and
(c) any portion of the Severance Payments due pursuant to this
Section 8, or any amounts payable under the second preceding
paragraph of this Section 8, wo
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