EXECUTIVE EMPLOYMENT
AGREEMENT
This Executive Employment Agreement (this
"Agreement") is made and entered into as of this 28th of
October 2006, by and between New Motion, Inc. a Delaware
corporation (the "Company") and Zach Greenberger
("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 Chief Technology Officer and Vice President of
Operations. 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: manage all aspects of Company's technology
platforms and applications, set strategy for Company's technology
architecture, application development, and data management, lead
the day to day operations team, prioritize activities of all
technical and operational resources, support the integration of new
technologies developed internally, purchased by 3 rd
parties, and/or supplied by industry partners, subject to the
supervision, direction and control of the CEO 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.
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.
1.5 Except for routine travel incident to the
business of the Company, Executive shall perform his duties and
obligations under this Agreement principally from an office
provided by the Company in Irvine, California, or such other
location in Los Angeles County, as the CEO may from time to time
determine.
2.
Term of
Employment. Executive's employment pursuant to this
Agreement shall commence on December 28, 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 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 unable to
perform the essential functions of his job without or without
reasonable accommodation for 90 consecutive days in any 12-month
period;
(d) 30 days written notice to Executive of
termination by the Company for Cause following a reasonable
opportunity for Executive to cure the alleged Cause for
termination. 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) 30 days written notice to Executive of
termination by the Company "without cause."
(f) 30 days written notice to Company by Executive
that he is terminating his employment for Good Reason. For the
purposes of this Agreement, Good Reason means: (i) Company engages
or is reasonably perceived to have engaged in an unfair, unlawful,
or fraudulent business practice or act; (ii) Company materially
diminishes Executive's title or duties hereunder; (iii) Company
reduces Executive's base pay; or (iv) any other Company action or
inaction that constitutes a material breach of this
Agreement.
(g) upon a Change in Control. For the purposes of
this Agreement, a Change in Control means the sale of all or
substantially all of the outstanding voting equity securities of
the Company issued as of the date of this Agreement in a
transaction or series of transactions pursuant to which the
business of the Company or control of the business of the Company
is sold or transferred to a third party or parties not controlled
by the persons controlling the Company immediately prior to
consummation of the sale; or (ii) any other merger, business
combination, or reorganization that results in the business of the
Company being controlled by a third party or parties not controlled
by the persons controlling the Company immediately prior to
consummation of such merger, business combination, or other
reorganization.
(i) 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, following the
expiration of the term if the Company terminates Executive's
employment without cause then the Company shall within 20 days of
termination pay as severance six months base pay, six months
prorated bonus based on the higher of Executive's target annual
bonus or annual bonus earned the previous year, and accelerate the
vesting of all unvested stock options under Section 3.3. If
Executive terminates his employment for Good Reason, then the
Company shall within 20 days of termination pay as severance three
months base pay, three months prorated bonus based on the higher of
Executive's target annual bonus or annual bonus earned the previous
year, and accelerate the vesting of all unvested stock options
under Section 3.3.
(ii) In the event Executive is terminated because of
Death pursuant to Section 2(b), Disability pursuant to Section
2(c), or for Cause pursuant to section 2(d), the Company shall pay
Executive or his estate (A) his base salary, (B) his prorata share
of his annual bonus calculated by taking the product of (i)
Executive's annual bonus from the preceding year or target annual
bonus, whichever is higher, and (ii) the fraction of the calendar
year worked by Executive as of the termination date, (C) all
accrued but unused vacation, and (D) any vested deferred
compensation that he has earned through the termination date.
Executive shall not be entitled to any additional compensation,
including salary, bonus or commissions.
(iii) In the event that Executive's employment is
terminated before the expiration of the term by the Company without
Cause pursuant to Section 2(e), or by Executive for Good Reason
pursuant to 2(f), the Company shall, in addition to all obligations
due to Executive as if he were terminated for Cause, within 20 days
of termination do the following: (a) if the termination occurs
during the first year of the term, pay Executive an amount equal to
two times Executive's target annual bonus, or if the termination
occurs during the second year of the term, the higher of
Executive's target annual bonus or annual bonus earned the previous
year; and (b) accelerate the vesting of all unvested stock options
under Section 3.3.
(iv) In the event that Executive's employment is
terminated because of a Change in Control pursuant to Section 2(g)
before the expiration of the term, the Company or its successors or
assigns shall, in addition to all obligations due to Executive as
if he were terminated for Cause, within 20 days of termination do
the following: (a) if the termination occurs during the first year
of the term, pay Executive an amount equal to two times Executive's
target annual bonus, or if the termination occurs during the second
year of the term, the higher of Executive's target annual bonus or
annual bonus earned the previous year; and (b) accelerate the
vesting of all unvested stock options under Section 3.3. In the
event that Executive's employment is terminated because of a Change
in Control pursuant to Section 2(g) following the expiration of the
term, the Company or its successors or assigns shall within 20 days
of termination pay as severance six months base pay, six months
prorated bonus based on the higher of Executive's target annual
bonus or annual bonus earned the previous year, and accelerate the
vesting of all unvested stock options under Section 3.3.
3.
Compensation; Executive Benefit Plans.
3.1 Base Salary. Commencing on the
Start Date, the Company shall pay Executive an annual base salary
of $200,000. 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.
3.2 Bonus. Executive will also be
eligible to receive a bonus, up to $45,000 per year (the "Bonus")
based On-Target Marketing.
3.3 Stock Options. Executive will
be eligible for 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. Executive's option will be
granted under the Company's future Stock Option Incentive Plan, in
accordance with and subject to each term of the Company's standard
form of option agreement.
3.4 Vacation. Executive will
receive two weeks paid vacation. One week will vest immediately
upon the Start Date and the other shall accrue dur