Exhibit 10.11
EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT AGREEMENT
(“Agreement”) is made effective as of November 9,
2005 (“Effective Date”), by and between IT&E
International Group (“Company”) and Peter Sollenne
(“Executive”).
RECITALS
A.
Company desires to retain the
services of Executive, and Executive is willing to provide such
services to the Company.
B.
Company and Executive desire to
enter into this Agreement to provide for Executive’s
employment by the Company, upon the terms and conditions set forth
herein.
The parties hereby agree as
follows:
1.
Duties
.
1.1.
Position
. Executive
shall serve as Chief Executive Officer of the Company and shall
have the duties and responsibilities incident to such position and
such other duties as may be determined in consultation with the
Company’s Board of Directors (“Board of
Directors”). Executive shall perform faithfully,
cooperatively and diligently all of his job duties and
responsibilities.
1.2.
Best
Efforts . Executive will expend
his best efforts on behalf of Company in connection with his
employment and will abide by all policies and decisions made by
Company, as well as all applicable federal, state and local laws,
regulations or ordinances.
2.
Employment
Term . The term of
Executive’s employment under this Agreement shall commence as
of the Effective Date and shall continue until that date which is
twenty-four (24) months after the Effective Date (the
“Employment Term”), unless earlier terminated by either
the Executive or the Company.
3.
Compensation
.
3.1.
Base
Salary . As compensation for
Executive’s performance of his duties hereunder, Company
shall pay to Executive an initial base salary of Twenty One
Thousand Five Hundred Eighty Three Dollars and Thirty Three Cents
($21,583.33) per month (“Base Salary”), which if
annualized, would represent Two Hundred Fifty Nine Thousand Dollars
($259,000), payable in accordance with the normal payroll practices
of Company, less required deductions for state and federal
withholding tax, social security and all other employment taxes and
payroll deductions. Such Base Salary may be increased at any
time or from time to time at the discretion of the Board of
Directors.
3.2.
Annual
Bonus . In addition to the
Base Salary, Executive shall be eligible to receive an annual cash
bonus, in accordance with, and based upon the satisfaction of the
criteria and performance standards to be established by the Board
(“Annual Bonus”).
3.3.
Stock
Options . Effective as of the
Effective Date, the Company will grant to Executive stock options
to purchase an aggregate of two million five hundred thousand
(2,500,000) shares of its common stock (the “Common
Stock”) The exercise price for such Common Stock shall
be equal to the fair market value of the Common Stock on the
Effective Date, as determined by the Board of Directors. Such
stock options shall have a ten (10) year term and become
exercisable or “vest” as described in the individual
stock option agreement related thereto, subject to acceleration as
set forth below. The exercisability or “vesting”
of such stock options shall automatically accelerate such that the
option shall become fully exercisable in accordance with its terms
as of the date the Executive is terminated without Cause or resigns
for Good Reason. The other terms and conditions of such stock
options shall be governed by the terms and conditions set forth in
the individual stock option agreement and the Company’s 2005
Equity Incentive Plan. Executive shall also be eligible to
receive such other stock options, restricted stock or other equity
incentive grants pursuant to one or more equity incentive plans
offered by the Company from time to time, subject to the approval
of the Board of Directors.
4.
Health and
Welfare Benefit Plans . The Executive and the
Executive’s family, as the case may be, shall be eligible for
participation in and shall receive all benefits under health and
welfare benefit plans, practices, policies and programs provided by
the Company to similarly situated employees of the Company at
Executive’s level. Such benefits will be paid by the
Company for Executive and Executive’s family.
5.
Customary
Benefits . Executive shall be
entitled to all customary and usual fringe benefits, including,
without limitation, a reasonable car allowance, and shall be
entitled to participate in all savings and retirement plans,
practices, policies and programs generally applicable to employees
of the Company and that are in effect during the Employment Term,
subject to the terms and conditions of Company’s benefit plan
documents, as applicable. Company reserves the right to
change or eliminate the fringe benefits or plans, practices and
programs on a company-wide, prospective basis, at any
time.
6.
Business
Expenses . Executive shall be
entitled to receive prompt reimbursement for all reasonable,
out-of-pocket business expenses incurred in the performance of his
duties on behalf of Company. To obtain reimbursement,
expenses must be submitted promptly with appropriate supporting
documentation in accordance with Company’s
policies.
7.
Vacation
. Executive
shall be entitled to at least four (4) weeks paid vacation
each calendar year in accordance with the Company’s plans,
policies and programs then in effect.
8.
Severance
Package Upon Termination of Employment Other Than for
Cause . If the Company
terminates Executive’s employment without Cause or Executive
resigns as an employee of the Company for Good Reason, Company
agrees to provide Executive with the Severance Package described in
section 8.1 below in accordance with the payment
schedule set forth in section 8.2 below, provided
Executive agrees to comply with all of the conditions set forth in
section 8.3 below.
8.1.
Description of
Severance Package . The “Severance
Package” will consist of:
2
(a)
all Accrued
Obligations (defined below);
(b)
a
“Severance Payment” equal to the greater of:
(i) the amount of Executive’s then in effect Base Salary
that would have been payable to Executive if Executive had been
employed by the Company from the Date of Termination through the
end of the Employment Term, or (ii) an amount equal to one
(1) year of Executives then in effect Base Salary;
and
(c)
Upon termination
of employment, the Executive will be allowed to continue in the
Company’s group health insurance plan at the
Executive’s own expense for up to eighteen (18) months, in
accordance with applicable law (COBRA). However, if the
Executive elects COBRA coverage, the Company will pay the first
twelve (12) months of COBRA coverage.
8.2.
Payment
Schedule . The Severance Package
will be paid less required deductions for state and federal
withholding tax, social security and all other employment taxes as
required by law. The Accrued Obligations described in
section 8.1(a) will be paid within fifteen (15) days after the
Date of Termination, unless otherwise required by law. The
Severance Payment described in section 8.1(b) will be
payable in equal installments in accordance with the normal payroll
practices of the Company from the Date of Termination through the
end of the Employment Term or one (1) year after the Date of
Termination, whichever is applicable (the “Severance
Period”), with the first installment to be paid on the
payroll date immediately following the later of the Date of
Termination or the date Executive executes the General
Release. The payments to be made under
Section 8.1(c) above shall be made in accordance with the
terms of the applicable plan or policy.
8.3.
Conditions to
Receive Severance Package . Executive will
receive the Severance Package described above only if he complies
with all of the following conditions and continues to comply with
the following for the duration of the Severance Period:
(a)
Executive
executes a full general release in favor of the Company in the form
attached hereto as Exhibit A (the “General
Release”); and
(b)
Executive
complies with the Company’s then in effect trade secrets
policies and any inventions and proprietary information agreement
between Executive and the Company (the “Confidentiality
Agreement”) in accordance with the terms thereof.
(c)
During the term
of the Executive’s employment by the Company, and for the
next succeeding twelve (12) months, the Executive shall not,
directly or indirectly:
(i)
Solicit any of
the Company’s customers except on the Company’s behalf,
or direct any current or prospective customer to anyone other than
the Company for goods or services that the Company
provides;
(ii)
Influence any of
the Company’s employees to terminate their employment with
the Company or accept employment with any of the Company’s
competitors; or
3
(iii)
Interfere with
any of the Company’s business relationships, including
without limitation those with customers, suppliers, consultants,
attorneys, and other agents, whether or not evidenced by written or
oral agreements.
The
Company’s obligation to make payments under this
Section 8 shall cease if at any time Executive is not in
compliance with any of the foregoing agreements.
9.
Definitions
.
9.1.
Accrued
Obligations . For purposes of this
Agreement, “Accrued Obligations” shall mean:
(i) payment of Executive’s then in effect Base Salary
through the Date of Termination to the extent not theretofore paid;
(ii) payment of any compensation previously deferred by
Executive (together with any accrued interest thereon) and not yet
paid by Company and any accrued vacation pay not yet paid by
Company; and (iii) payment of any unreimbursed expenses as
contemplated by Section 6 hereof.
9.2.
Cause . For purposes of this
Agreement, “Cause” shall mean: (i) any willful,
material violation of any law or regulation applicable to the
business of the Company or any subsidiary of the Company;
(ii) conviction for, or guilty plea to, a felony or a crime
involving moral turpitude, or any willful perpetration of a common
law fraud; (iii) commission of an act of personal dishonesty
which involves personal profit in connection with the Company or
any subsidiary of the Company, or any other entity having a
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