Exhibit 10.1
EXECUTIVE EMPLOYMENT
AGREEMENT
THIS EXECUTIVE
EMPLOYMENT AGREEMENT , is dated as of this 27
th
day of April, 2007
(the “Agreement”), by and between DYNAMIC RESPONSE
GROUP, INC., a Florida corporation (the “Company”),
and MELISSA K. RICE, (the
“Executive”).
BACKGROUND:
WHEREAS, the Company is engaged in
the business of developing, manufacturing and marketing consumer
products and services distributed nationally and internationally
through direct response television and radio infomercials and in
e-commerce; and
WHEREAS, Executive has acted as
Company’s securities counsel for an extended period of time
and as such has become intimately familiar with the Company and its
needs; and
WHEREAS, the Company believes that
the Executive possesses the skills and abilities necessary for the
Company to meet its current and future objectives; and
WHEREAS, the Executive desires to
provide such services to the Company in such capacities, on and
subject to the terms and conditions hereof.
NOW, THEREFORE, in consideration of
the mutual covenants set forth below, the parties hereby agree as
follows.
AGREEMENT
Section 1.
Employment.
1.1 Employment .
Subject to all of the terms and conditions hereof, the Company does
hereby employ the Executive and the Executive does hereby accept
the employment.
1.2 Term . This
Agreement shall be in effect for a period of three (3) years
(the “Initial Term”) beginning on the date of execution
of this Agreement (the “Effective Date”), and shall
renew for additional two (2) year term, and then automatically
renew for additional one (1) year terms unless terminated by
either party as set forth below.
1.3 Duties
(a) Capacity . So long as she
is employed by Company, Executive shall be employed as CEO, of the
Company and will be an employee of the Company at all times during
the term of this Agreement. Company and Executive acknowledge and
agree that Executive’s position is the Chief Executive
Officer and shall be entitled to the rights and benefits that an
afforded to the responsibilities of a Chief Executive Officer.
Executive will report directly to the Company’s Board of
Directors. Executive will also serve as a member of the Board of
Directors as allowed by the SEC to represent a member from the
Company’s day-to-day
operations. The duties and corresponding
authority would include, but are not limited to, maintaining the
Company’s public status within the legal guidelines of the
Security and Exchange Commission, overseeing the overall direction
of Company growth through financing, business development,
strategic positioning, distribution partners, branding, day to day
operations, creation of new entertainment industry programming the
acquisition of programming, co-productions and the outsource
production services of the Company’s soundstage and
production capabilities with a focused direction to increase the
Company’s revenue and shareholder value. Day to day
operational duties include, but shall not be limited to, having the
final approval in the negotiations of all major contracts, hiring
of management and other employees, the creative and business
direction of the Company, and, working directly with the
Company’s legal counsel, auditors, and other senior
management, consultants and producers. In the exercise of her
duties, Executive will comply with all policies and procedures of
the Company as it relates to hiring and discharging employees that
directly or indirectly report to Executive. She will also provide
input regarding compensation including raises and bonuses for
senior management employees, to the Board of Directors or its
compensation committee as directed and required by compensation
policies established by the Board of Directors. Executive shall
carry out these duties with the assistance of other employees,
consultants or independent contractors that Executive may choose to
retain, in Executive’s reasonable discretion.
(b) Schedule. So long as she
is employed by Company, Executive shall devote the majority of
Executive’s working time and attention, as necessary, to
faithfully and fully carryout her duties described herein;
provided, however, Executive may (i) serve as a Director of other
business organizations with the prior written approval of Company,
(ii) devote time to and invest in non-competing side
activities, provided that such activities do not individually or in
the aggregate interfere with her duties so as to adversely affect
Company’s business. Executive shall at all times perform her
duties and obligations faithfully, diligently and to the best of
Executive’s ability.
(c) Key Man Insurance.
Company may, for its benefit and at its own, expense, insure
Executive’s life. Executive agrees to submit to such physical
examination and supply such information as may be reasonably
required in connection therewith.
2. Compensation
.
2.1 Base Compensation
. Base Salary. Subject to increases pursuant to the cost of
living adjustment described below, Company shall pay to Executive
an annual base salary of Two Hundred and Twenty-five Thousand
Dollars ($225,000.00) during the term of this Agreement (the
“Base Salary”) or such greater amount as may be
determined upon a review of Executive’s performance to be
undertaken pursuant to Company policy regarding performance reviews
by the Board of Directors at least once annually. Executive’s
Base Salary shall be payable in accordance with Company’s
standard payroll procedures. Executive’s Base Salary at the
commencement of the second and each subsequent year shall be
adjusted to provide for all cost of living increases based upon the
percentage increase (if any) in the Consumer Price Index for All
Urban Consumers (1967-100; Alt Cities), prepared by the United
States Bureau of Labor Statistics, or any successor thereto, over
said Index in effect at the commencement of the preceding calendar
year. Executive’s Base Salary will be no less than equal to
or greater than any other senior executive.
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2.2 (1) In the event the Board
of Directors determines that the Company cannot afford to pay
Executive any portion of her Base Salary, Executive may, at her
sole option elect one of the following:
a. Agree to defer receipt of her
Base Salary until such time as the Company has the funds to pay
her. In the event that Executive elects this option, the unpaid
salary shall be paid with no interest. However, the Company, as
additional compensation, shall immediately issue Executive an
amount of Common Stock equal to 20% of the deferred Salary based
upon a market value determined to be the average 30-day trading
price prior to each such election; or,
b. Elect to convert all, or a
portion of the unpaid Salary into Common Stock at a market value
equal to 80% of the average 30-day trading price prior to each
election.
2.3 Signing Bonus . In
addition to the base compensation, Company shall issue to the
Employee as a signing bonus 6500,000 shares of fully vested
stock.
2.4 Expenses . The Company
shall pay the Executive’s reasonable moving expenses for her
relocation from Sarasota, Florida to Miami, Florida. In the event
that the Company cannot afford to pay said moving expenses at the
time they are incurred, the Executive shall be reimbursed as soon
as is reasonably practicable thereafter, but not more than 1 year
from the date hereof. The Company shall pay all the
Executive’s reasonable expenses in connection with the
Executive’s services hereunder.
2.5 Bonus Compensation
.
2.5.1. In addition to the base
compensation, the Company shall issue to the Executive 100,000
shares of the Company’s common stock on each one year
anniversary of this Agreement during the term.
2.5.2. Annual Performance Bonus.
Company shall pay Executive an annual bonus, subject to meeting
mutually agreed upon annual performance criteria mutually
established by Company and Executive between February 1 and
April 1 of each year of this Agreement. Company and Executive
agree to establish the annual performance criteria, for the first
year of this Agreement within 45 days of the execution of this
Agreement.
2.5.3. In each year during the Term
that total EBITDA increases by at least ten percent (10%) from
the previous year (the “Bonus Threshold”), the Employee
shall be issued a bonus of 250,000 shares of the Company’s
common stock.
2.5.4. For each five percent
(5%) increase in EBITDA over the Bonus Threshold, the Employee
shall be issued a bonus of 250,100 shares of the Company’s
common stock, up to a maximum of 1,000,000 shares.
2.5.5. In addition to the stock
bonuses set forth above, in each year during the Term that total
gross revenues of the Company increase by more than Fifteen Million
Dollars from the previous year the Employee shall be paid a cash
bonus equal to twenty percent of the Base Compensation.
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2.5.6. For purposes of calculating
the bonuses set forth in this Section 2.4, gross revenues
shall not include the revenues of companies acquired by the Company
during the year for which bonuses are being calculated.
2.5.7 Certain Benefits. Executive
shall be entitled to participate in all employee benefit programs
established by the Company from time to time for employees or
executives of Company to the extent that executives or senior
management employees of Company generally are eligible to
participate in such programs. Executive shall be further entitled
to an annual paid vacation of four (4) weeks and other
benefits in accordance with Company’s policies as from time
to time established by the Company or the Company’s Board of
Directors (the “Board”) for employees and/or senior
executive officers and the following: (i) full medical, dental
and vision insurance plans for Executive and her immediate family;
(ii) a per month automobile leasing, operating, insurance and
maintenance expense allowance of $700 per month or the cash
equivalent in the form of an expense reimbursement; and
(iii) cell phone and other communication device acquisition
and operating expenses.
(i) It is understood that payment of
all the above benefits are contingent on the Company’s
ability to reasonably afford such benefits. At such time as the
Company can afford such benefits, Executive will be
eligibl
