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
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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&rs
