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EXECUTIVE EMPLOYMENT AGREEMENT

Employment Agreement

EXECUTIVE EMPLOYMENT AGREEMENT | Document Parties: MPLC, INC. | New Motion, Inc | Shane A. Maidy You are currently viewing:
This Employment Agreement involves

MPLC, INC. | New Motion, Inc | Shane A. Maidy

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Title: EXECUTIVE EMPLOYMENT AGREEMENT
Governing Law: California     Date: 2/13/2007
Industry: Printing and Publishing     Sector: Services

EXECUTIVE EMPLOYMENT AGREEMENT, Parties: mplc  inc. , new motion  inc , shane a. maidy
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EXECUTIVE EMPLOYMENT AGREEMENT

 

This Executive Employment Agreement (this "Agreement") is made and entered into as of this 1st day of October 2005, by and between New Motion, Inc. a Delaware corporation (the "Company") and Shane A. Maidy ("Executive").

 

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 Executive as Senior Vice President of Marketing & Licensing. Executive hereby accepts such engagement and employment.

 

 1.2 Executive 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. Executive 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 Executive's duties and responsibilities shall be as follows: responsible for the development and expansion of the Company's licensed content library and strategic placement of such content on New Motion's mobile platform, subject to the supervision, direction and control of the Board of Directors (the "Board") of the Company. In addition, Executive's duties shall include those duties and services for the Company and its affiliates as the Board shall from time to time reasonably direct. Executive shall report directly to the Chief Executive Officer of the Company.

 

 1.4 Executive 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. Executive will use his best efforts and abilities faithfully and diligently to promote the Company's business interests.

 

(a) Company acknowledges and approves that Executive currently has a vested interest in another Corporation that maintains and is acquiring content from international sources which is to be utilized in various media formats. From time to time Executive may chose to hold director and officer positions with the Corporation. Executive has made Company aware of these circumstances and have agreed that this will not prevent Executive from performing his services to Company. Executive will perform his services for the Corporation so not to interfere with his services to Company. Executive shall inform Company immediately of any potential conflicts of interests and shall resolve such potential conflicts in favor of the Company.

 

Executive may perform his duties and obligations under this Agreement remotely for up to three days per week, so long as doing so does not interfere with his performance of such duties and obligations and the Executive complies with the Company's Telecommunications Policy. On days Executive is not working remotely, he shall work from an office provided by the Company in Orange County, California, or such other location in Los Angeles or Orange County, California, as the Board may from time to time determine.

 

2.   Term of Employment. Executive's employment pursuant to this Agreement shall commence on August 25, 2005 ("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 Executive;

 

(c) delivery to Executive of written notice of termination by the Company if Executive shall suffer a "permanent disability," which for purposes of this Agreement shall mean a physical or mental disability which renders Executive, 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 Executive 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 Executive 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) Executive'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 Executive of termination by the Company "without cause."

 

After the expiration of the Employment term under Section 2(a), if Executive continues to be employed by the Company, such employment shall be terminable "at will" by either the Company or Executive and the terms and conditions of this Agreement shall continue to apply; provided, however, that if the Company terminates Executive's "at will" employment without Cause, then the severance amount set forth in Section 3.1 payable to Executive as a result of such termination shall be equal to one month's pay at Executive's then-current base salary, accrued vacation and any Company approved holidays for which the Executive worked reimbursement of any approved expenses incurred up through date of termination and such amount shall be paid pursuant to California law. Additionally, Executive shall be entitled to Commissions as described in Section 3.3 of this Agreement for a period as agreed to in Exhibit A Paragraph 2.f. which provides Executive upon termination of its relationship with Company an one percent (1%) Commission Fee of Company's Gross Revenue for any license signed, content secured or relationship developed where Executive introduces Company to Property owner, Licensor or business partner.

 

In the event Executive is terminated for Cause pursuant to section 2(d), the Executive shall only receive his base salary though the termination date and shall not be entitled to any additional compensation, including salary, or bonus, excluding commissions. accrued vacation, Company approved holidays for which the Executive worked. Additionally, Executive shall be entitled to Commissions as described in Section 3.3 of this Agreement for a period as agreed to in Exhibit A Paragraph 2.f. which provides Executive upon termination of its relationship with Company an one percent (1%) Commission Fee of Company's Gross Revenue for any license signed, content secured or relationship developed where Executive introduces Company to Property owner, Licensor or business partner.

 

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3. Compensation; Executive Benefit Plans.

 

 3.1 Base Salary. Commencing on the Start Date, the Company shall pay Executive an annual base salary of $135,000.00. Executive's annual base salary will be increased to $160,000.00 on the first anniversary of the Start Date. Executive'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 executives of the Company. In the event that Executive's employment is terminated, above (i.e., without cause), the Company shall continue to pay Executive's then-current base salary, Bonus described in Section 3.2, Commissions described in Section 3.3, as severance pay for the balance of the initial term hereof, and Executive shall retain only those Options described in Section 3.4, below, that have vested prior to the effective date of such termination.

 

3.2 Bonuses.

 

(a)   Executive will also be eligible to receive a bonus, capped at $120,000 per year (the "Bonus") at the times and in the amounts set forth below:

 

The Bonus will be paid in cash pursuant to the schedule below and will accrue on each monthly anniversary of the Start Date for a period of twenty four months (the "Bonus Period"). At the end of each calendar month following the Start Date, Executive shall accrue a bonus of 1% of the Company's then completed month's net profits, as determined in accordance with generally accepted accounting principals ("GAAP"). The accrued bonus for each monthly period shall be payable under this paragraph within 30 days after the end of each calendar quarter in the Bonus Period and upon completion of the un-audited interim financial statements of the Company (or its successor) for each such calendar quarter for which a Bonus is payable hereunder (the "Bonus Payment Date"). The Bonus for any month in the Bonus Period which is less than a full month, shall be prorated for the applicable month. All bonus calculations shall be made by the Company, whose determination shall be final and binding on Executive and the Company absent manifest error.

 

In the event of an adjustment to the financial statements used above, occasioned by results of the actual year end audit, the Executive and the Company shall make an adjusting payment (in cash, or stock if the stock election has been made) to one another, as necessary, to reflect any change to the financial information used to calculate the bonus payable hereunder. Any under payment of Bonuses will be paid to Executive within 30 days of the discovered error, however these adjustments will not effect the maximum allowable under Section 3.2. Any over payment of Bonuses to Executive will be reflected in next bonus period, however these adjustments will not effect the maximum as allowed under Section 3.2. Any overpayment of a bonus will be adjusted through the future bonus payment.

 

(b)   Executive will also receive a bonus equal to 1% of the net profits of the Company's licensing division, as determined in accordance with generally accepted accounting principals ("GAAP"). The accrued bonus for each monthly period shall be payable under this paragraph within 30 days after the end of each calendar quarter and upon completion of the un-audited interim financial statements of the Company (or its successor) for each such calendar quarter for which a bonus is payable hereunder (the "Bonus Payment Date"). The bonus for any month which is less than a full month, shall be prorated for the applicable month. All bonus calculations shall be made by the Company's outside accountants whose determination shall be final and binding on Executive and the Company absent manifest error.

 

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In the event of an adjustment to the financial statements used above, occasioned by results of the actual year end audit, the Executive and the Company shall make an adjusting payment (in cash, or stock if the stock election has been made) to one another, as necessary, to reflect any change to the financial information used to calculate the bonus payable hereunder. Any under payment of Bonuses will be paid to Executive within 30 days of the discovered error, however these adjustments will not effect the maximum allowable under Section 3.2. Any over payment of Bonuses to Executive will be reflected in next bonus period, however these adjustments will not effect the maximum as allowed under Section 3.2.

 

 3.3 Commissions. Attached as Exhibit A to this Agreement is a copy of Executive's Consulting Agreement with the Company, dated April 20, 2005 ("Consulting Agreement"). Executive will receive commissions earned as a result of services performed under the Consulting Agreement according to the terms and at the rates set forth in section 2 of the Consulting Agreement ("Residual Commissions"). A complete list of the relationships, deals and/or business opportunities for which Executive will receive Residual Commissions is set forth on Exhibit B to this Agreement.

 

 3.4 Stock Options. Subject to approval by the Company's Board of Directors, you will be granted an option to purchase up to 60,000 shares of NMI's Common Stock (the "Options") at an exercise valued at the fair market value of the stock as of the Value Determination Date (defined below). For purposes hereof, if the Company is a private company, the fair market value of the stock as of the last day in the applicable quarterly period (the "Value Determination Date") shall be determined in good faith by the Board of Directors of the Company. If the Company is public at that time, the fair market value of the stock on the Value Determination Date shall be the average closing price of the stock on the market on which it is then being traded for the 20 trading days immediately preceding the Value Determination Date. The Options will be governed by and granted pursuant to a separate Stock Option Agreement. The Options will be subject to vesting so long as you continue to be employed by the Company, according to the vesting schedule set forth in the Stock Option Agreement. Accelerated Vesting: Company agrees that all 60,000 shares (or the remaining unvested shares at the time shall or any subsequent grant of shares) shall vest automatically for Executive, should one of the following events take place, (1) a "Change of Control" For purposes of this letter agreement, a "Change of Control" shall be deemed to have occurred in the event (i) any person (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or group of such "persons", without the consent of the Company's Board of Directors, is or becomes a "beneficial owner" (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of securities of the Company representing fifty-one percent (51%) or more of the combined voting power of the Company's then outstanding securities; (ii) of a merger, consolidation or stock sale which results in the holders of the Company's capital stock immediately prior to such merger, consolidation or stock sale owning less than fifty percent (50%) of the voting equity of the Company's capital stock immediately after such merger, consolidation or stock sale; or (iii) of the sale or transfer of all or substantially all of the assets of the Company.

 

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3.5 Vacation. You will receive two weeks paid vacation, one week will vest immediately upon the Start Date and you shall accrue the other week. During the second year of your employment, you will receive three weeks paid vacation which you shall accrue during that year. All vacation shall be paid and earned in accordance with the Company's vacation policy.

 

 3.6 Lap


 
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