EMPLOYMENT
AGREEMENT
This Employment Agreement (this "Agreement") is
made and entered into as of this 31 st day of October
2006, by and between New Motion, Inc. a Delaware corporation (the "
Company ") and Farlan Dowell
("Employee").
1.
Engagement and
Duties.
1.1 Upon the terms and subject to the conditions
set forth in this Agreement, the Company hereby engages and employs
Employee as Director of Products. Employee hereby accepts such
engagement and employment.
1.2 Employee will have access to certain
confidential information and may, during the course of his
employment, develop certain information which will be the property
of the Company. Employee will be required to sign the
Company’s “Proprietary Information and Assignment of
Inventions Agreement” as a condition of his employment under
this Agreement.
1.3 Employee’s duties and responsibilities
shall be as follows: to develop and manage the product offerings in
a specific channel (i.e. Sports, Entertainment, Lifestyle, etc),
subject to the supervision, direction and control of the Senior VP
of Operations of the Company. In addition, Employee's duties shall
include those duties and services for the Company and its
affiliates as the Board shall from time to time reasonably direct.
Employee shall report directly to the Senior VP of Operations of
the Company.
1.4 Employee agrees to devote his primary business
time, energies, skills, efforts and attention to his duties
hereunder, and will not, without the prior written consent of the
Company, which consent will not be unreasonably withheld, render
any material services to any other business concern. Employee will
use his best efforts and abilities faithfully and diligently to
promote the Company's business interests.
1.5 Except for routine travel incident to the
business of the Company, Employee shall perform his duties and
obligations under this Agreement principally from an office
provided by the Company in Los Angeles, California, or such other
location in Los Angeles County, as the Senior VP may from time to
time determine. In addition, the Employee will be expected to make
routine trips to the company’s headquarters in Orange County
California as his job requires.
1.6 Notwithstanding anything to the contrary, and
including both during and after the term of the agreement, your
employment is at-will and therefore your employment can be
terminated, with or without cause, and with or without notice, at
any time, at your option or the Company's option. Although other
terms and conditions of employment may change, this at-will
employment relationship as defined above will remain in effect
throughout your employment with the Company, unless it is modified
by a specific, express written agreement with the Company signed by
you and the CEO of the Company. This at-will employment
relationship may not be modified by any oral or implied agreement,
or by any person, statement, act, and series of events or pattern
of conduct. This paragraph about the at-will nature of your
employment sets forth our complete understanding regarding this
subject.
2.
Term of
Employment. Employee’s employment pursuant to this
Agreement shall commence on December 4, 2006 (“Start
Date”) and shall terminate on the earliest to occur of the
following:
(a) the close of business on the second anniversary
of the Start Date;
(b) the death of Employee ;
(c) delivery to Employee of written notice of
termination by the Company if Employee shall suffer a
“permanent disability,” which for purposes of this
Agreement shall mean a physical or mental disability which renders
Employee , in the reasonable judgment of the Board, unable to
perform his duties and obligations under this Agreement for 90 days
in any 12-month period;
(d) notice to Employee of termination by the
Company for Cause. For purposes of this Agreement, Cause means:
(ii) any material breach of any of the terms of this Agreement;
(ii) any act or omission knowingly undertaken or omitted by
Employee with the intent of causing damage to the Company, its
properties, assets or business, goodwill, or its stockholders,
officers, directors or employees; (ii) commission of any material
act of dishonesty, fraud, misrepresentation, misappropriation,
embezzlement, or other act of moral turpitude; (iii) Employee 's
consistent failure to perform his normal duties or any obligation
under any provision of this Agreement, in either case, as directed
by the Chief Executive Officer and/or the Board; (iv) conviction
of, or pleading nolo contendere to (A) any crime or offense
involving monies or other property of the Company; (B) any felony
offense; or (C) any crime of moral turpitude; or (v) the chronic or
habitual use or consumption of drugs or alcoholic beverages;
or
(e) notice to Employee of termination by the
Company "without cause."
After the
expiration of the Employment term under Section 2(a), if employee
continues to be employed by the Company, such employment shall be
terminable "at will" by either the Company or Employee and the
terms and conditions of this Agreement shall continue to apply;
provided, however, that if the Company terminates Employee's "at
will" employment without Cause, then the severance amount set forth
in Section 3.1 payable to Employee as a result of such termination
shall be equal to Employee’s then-current base salary and
health benefits described in Section 3.5 below as severance pay for
two months and such amount shall be paid in a lump sum within 20
calendar days of the date of Employee's termination.
In the event
Employee is terminated for Cause pursuant to section 2(d), the
Employee shall only receive his base salary though the termination
date and shall not be entitled to any additional compensation,
including salary, bonus or commissions.
3.
Compensation; Employee
Benefit Plans.
3.1 Base Salary . Commencing on the Start Date, the Company
shall pay Employee an annual base salary of $85,000.
Employee’s base salary shall be payable in installments
throughout the year in the same manner and at the same times the
Company pays base salaries to other Employee’s of the
Company. In the event that Executive's employment is terminated
pursuant to Section 2(e), above (i.e., without cause), the Company
shall continue to pay Executive's then-current base salary and
health benefits described in Section 3.5 below as severance pay for
two months.
3.2 Bonus . Employee will also be eligible to receive a
bonus; up to $15,000 per year (the "Bonus") based
On-Target.
3.3 Stock Options . Subject to approval by the Company’s
Board of Directors, you will be granted an option to purchase
shares of the Company’s common stock at an exercise price per
share equal to the fair market value of the common stock, to be
determined by the Board of Directors on the date of the grant. Your
option will be granted under the Company's 2005 Stock Option
Incentive Plan, in accordance with and subject to each term of the
Company's standard form of option agreement.
3.4 Vacation . You will receive three weeks paid vacation,
one week will vest immediately upon the Start Date and you shall
accrue the other two weeks. During the second year of your
employment, you will receive three weeks paid vacation, which shall
begin to accrue as of the first day of your second year of
employment. All vacation shall be paid and earned in accordance
with the Company’s vacation policy.
3.5 Relocation Allotment . Within 30 days following the effective date,
the Company shall make available to the Employee “Advanced
Funds” up to the amount of $3,000 through cash payment or
expense reimbursements directly related to and to assist with the
Employee’s cost incurred in relocation of his personal
residence to Los Angeles or Orange County, California. All expenses
to be covered by such Advance Funds must be submitted to the
Company for prior approval.
3.6 Other Benefits . During the term of his employment hereunder,
Employee shall be eligible to participate in all operative employee
benefit and welfare plans of the Company then in effect from time
to time and in respect of which all Employees of the Company
generally are entitled to participate ("Company Employee Benefit
Plans"), including, to the extent then in effect, medical, and
other insurance plans, all on the same basis applicable to
employees of the Company whose level of management and authority is
comparable to that of Employee.
The Company
reserves the right to modify, suspend, or discontinue any and all
of the above-mentioned plans, practices, policies and programs at
any time as long as such action is taken generally with respect to
other similarly situated Employee’s of the