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Exhibit 10.19
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (this "Agreement"), dated as of October
23rd, 2006
(the "Effective Date"), between Home Director, Inc., a Delaware
corporation (the
"Company"), and Michael Liddle ("Employee").
WHEREAS, the Company desires to employ Employee as its Chairman
of the
Board of Directors and Chief Executive Officer and
WHEREAS, Employee is willing to accept such employment on the
terms set
forth herein.
NOW, THEREFORE, the Company and Employee hereby agree as
follows:
1. Employment.
1.1 General. The Company hereby employs Employee in the capacity
of
Chairman of the Board of Directors and Chief Executive Officer
and Employee
hereby accepts such employment, upon the terms and subject to
the conditions
herein contained.
1.2 Board of Directors. During the term of Employee's
employment
hereunder, the Employee agrees to serve as a member of the
Boards of Directors
of the Company.
1.3 Duties and Authority. During the term of Employee's
employment
hereunder, the Employee shall have such responsibilities, duties
and authority
as are consistent with his title and such additional
responsibilities, duties
and authority as may, from time to time, be reasonably assigned
to Employee by
the Board of Directors of the Company. During the term of this
Agreement,
Employee shall serve the Company, faithfully and to the best of
his ability, and
shall devote his business time and efforts to the business and
affairs of the
Company (including its subsidiaries and affiliates) and the
promotion of its
interests or such other activities as the Board of Directors of
the Company may
approve from time to time; provided, however, that this shall
not be construed
as either preventing Employee from investing his assets in such
form or manner
as will not require any services on the part of Employee or
precluding Employee
from performing a reasonable amount of civic and/or charitable
service. The
Company hereby acknowledges and approves the following
activities by Employee:
(a) Employee's and Employee's spouse's ownership of Emerging
Technology
Partners, a business advisory company and (b) Employee's partial
ownership and
member on the Board of Directors of Catch Media, Inc., a digital
content
management company. In addition, Company acknowledges that the
Employee may
become engaged in, invest in, or become a Partner of additional
companies that
do not compete with Company either directly or indirectly.
Employee will be
furnished with facilities and services commensurate with his
position and
adequate for the performance of his duties. Employee shall make
himself
available to the Company at such times and places as the Company
shall
reasonably request during the term hereof.
<PAGE>
2. Term of Employment. The term of this Agreement shall commence
on the
Effective Date and shall continue through December 31, 2009 (the
"Initial
Term"). Thereafter and unless this Agreement is terminated in
accordance with
the provisions set forth in Section 4 hereof, the term of this
Agreement shall
be automatically extended for successive and additional one-year
periods.
3. Compensation and Benefits.
3.1 Salary. The Company shall pay to Employee a base salary at
the
annual rate of $360,000 or at such increased rate as the Board
of Directors may
hereafter from time to time determine ("Base Salary"), payable
in accordance
with the regular payroll practices of the Company and subject to
all applicable
federal and state deductions and withholdings. During the term
of this
Agreement, Employee's Base Salary shall be reviewed no less
frequently than once
per year to determine whether or not such Base Salary should be
increased in
light of Employee's duties, responsibilities and performance,
and, if it is
determined that an increase is merited, such increase shall be
promptly put into
effect and Employee's base salary as so increased shall
constitute Employee's
Base Salary for purposes of this Section 3.1.
3.2 Expenses. The Company shall pay for, or reimburse Employee
for,
all other reasonable out-of-pocket expenses incurred by him in
performing
services under this Agreement. All such payments or
reimbursements shall be made
by the Company according to the Company's expense account and
reimbursement
policies and provided that Employee shall submit reasonable
documentation with
respect to such expenses. In addition the company will pay a car
allowance not
to exceed $750 per month. As the normal course of business shall
cause Employee
to travel, the Company acknowledges that Employee shall be
entitled to fly
Business Class or First Class when there is no Business Class
section on a plane
for any travel and will pay all expenses related to such travel.
The Company
shall pay a maximum of $2,000 annually for disability insurance
on behalf of the
Employee. All such payments or reimbursements shall be made by
the Company
according to the Company's expense account and reimbursement
policies and
provided that Employee shall submit reasonable documentation
with respect to
such expenses.
3.3 Incentive Compensation Plan. The Company, with respect to
each
calendar year during the term hereof, shall pay Employee an
annual cash bonus (a
"Bonus") in an amount equal to no less than 35% of Employee's
annual Base Salary
provided that the Employee remains employed by the Company
continuously
throughout such calendar year. The Company shall pay such Bonus,
if any, to
Employee on or before December 31st of such calendar year. The
bonus evaluation
for 2006 will be based on the Chairman of the Board of Directors
recommendation
to the Board of Directors Compensation Committee and will be
based on if the
Company is Profitable (as defined below) or has been
Strategically Repositioned
(as defined below). The term "Profitable" means positive net
cash flow from the
Company's business activities. The term "Strategically
Repositioned" means
additional funding was achieved and/or business partners were
brought in to
benefit the company. In addition to the foregoing, the Company
shall pay
Employee a bonus of $200,000 upon: (a) the listing of shares of
the Company's
Common Stock on a major stock exchange, including the American
Exchange, NASDAQ,
NYSE, or AIM or (b) the consummation of a merger,
reorganization, consolidation,
exchange, transfer of assets, or similar transaction in which
the Company is not
the surviving company (a "Change In Control").
<PAGE>
3.4 Incentive Stock Options. Simultaneously with the execution
and
delivery of this Agreement, the Company and Employee shall
execute and deliver a
Stock Option Agreement (the "Option Agreement") pursuant to
which the Company
shall grant Employee an option to purchase 545,455 shares of the
Common Stock of
the Company in accordance with the terms and conditions thereof.
The Option
Agreement shall provide that all options shall immediately be
granted, and that
they shall reverse vest monthly over three years beginning on
the Effective
Date, have an exercise price of $.81 per share, and vesting will
accelerate upon
the consummation of an a Change In Control.
3.5 Vacation. Employee shall be entitled to five weeks of
vacation
during each calendar year of this Agreement, or such greater
period as the Board
of Directors of the Company shall approve, and to paid holidays
given by the
Company to its employees generally, without reduction in salary
or other
benefits. Vacation for a calendar year that is not used may be
used in
subsequent calendar years. Upon termination of Employee's
employment pursuant to
Section 4 hereof, Employee shall be entitled, in addition to the
compensation
and benefits provided for in Section 4, to receive in cash an
amount equivalent
to all accrued and unused vacation as of such termination
date.
3.6 Equipment. The Company shall provide Employee with
equipment
reasonably determined by the Company to be necessary for
Employee to perform his
duties under this Agreement, including, without limitation, a
portable personal
computer and a cellular telephone.
3.7 No Other Benefits. During the term of this Agreement or upon
any
termination hereof, the Company shall have no obligation to pay
or provide, any
compensation or benefits other than as set forth herein;
provided, however, that
Employee shall be entitled to all benefits generally available
under the
employee benefit plans, and the policies and practices of, the
Company,
determined in accordance with the applicable terms and
provisions of such plans,
policies and practices, in each case, as accrued to the date of
termination of
employment. Employee hereby acknowledges that the Company may
desire to obtain
key-man life insurance on him. In such event, Employee shall
take all action
requested by the Company, including submitting to a physical
examination, to
facilitate the Company obtaining such policy.
<PAGE>
4. Termination of Employment.
4.1 Events of Termination. Employee's employment hereunder
shall
terminate prior to the expiration of the term set forth in
Section 2 hereof upon
the occurrence of any one or more of the following events:
(a) Death. In the event of Employee's death, Employee's
employment shall terminate on the date of death.
(b) Termination By the Company for Cause. The Company may, at
its
option, terminate Employee's employment for Cause (as defined
below) upon giving
written notice of termination to Employee. Employee's employment
shall terminate
on the date on which such notice shall be given. For purposes
hereof, "Cause"
shall mean Employee's (i) conviction of or guilty plea to a
felony, (ii)
commission of fraudulent, illegal or dishonest acts, as
determined by the Board
of Directors of the Company, (iii) willful misconduct or gross
negligence which
reasonably could be expected to be materially injurious to the
business or
operations of the Company (monetarily or otherwise) or (iv)
material failure to
perform his duties under this Agreement, or any other material
breach of this
Agreement, as reasonably determined by the Board of Directors of
the Company and
Employee fails to cure such failure to perform or such breach
within thirty (30)
days following receipt of written notice of such failure to
perform or such
breach.
(c) Termination By the Company Without Cause. The Company may,
at
its option, terminate Employee's employment for any reason
whatsoever by giving
at least thirty (30) days prior written notice of termination to
Employee.
(d) Termination By Employee. Employee may terminate
Employee's
employment for any reason whatsoever by giving at least thirty
(30) days prior
written notice of termination to the Company.
(e) Disability. In the event of Employee's Disability (as
defined
below), the Company will have the option to terminate Employee's
employment by
giving a written notice of termination to Employee. Such notice
shall specify
the date of termination, which date shall not be earlier than
thirty (30) days
after such notice is given. For purposes of this Agreement,
"Disability" means
the inability of Employee to substantially perform his duties
hereunder for
ninety (90) consecutive days or one hundred eighty (180) days
out of three
hundred sixty-five (365) days as a result of a physical or
mental illness, all
as determined in good faith by the Board of Directors of the
Company following
consultation with medical or mental health experts selected by
the Board of
Directors of the Company.
(f) Termination By Employee for Good Reason. Employee may, at
his
option, terminate Employee's employment upon giving written
notice of
termination to the Company in the event that (i) the Company
commits a material
breach of the terms of this Agreement and fails to cure such
breach within
thirty (30) days following receipt of written notice of such
breach, or (ii)
Employee's Base Salary, title, duties, authority, or
responsibilities (as such
duties, authority, and responsibilities have been established by
the Board of
Directors of the Company) are substantially reduced.
<PAGE>
4.2 Company's Obligations Upon Termination. Following the
termination
of Employee's employment under the circumstances described
below, the Company
shall pay to Employee (or in the event of Employee's death, as
directed by the
executor of Employee's estate) the following compensation and
provide the
following benefits, and in the case of Section 4.2(a) in full
satisfaction and
final settlement
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