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Exhibit 10.57
 
EMPLOYMENT AGREEMENT
 
This Employment Agreement (“Agreement”) is entered into as of May 11, 2011, by
and between WebMediaBrands Inc., a Delaware corporation (“WMB”), and Justin L.
Smith, a resident of the State of California (“Smith”).
 
WITNESSETH:
 
WHEREAS, Smith is the founder of and majority stockholder in Inside Network,
Inc., a California corporation (“INI”); and
 
WHEREAS, WMB and the holders of INI’s outstanding equity securities have entered
into a Stock Purchase Agreement, dated as of May 11, 2011 (the “Definitive
Agreement”), whereby WMB will be acquiring all of the outstanding securities of
INI (the “Transaction”); and
 
WHEREAS, following the Transaction, INI will become a wholly owned subsidiary of
WMB; and
 
WHEREAS, one of the material terms of the Definitive Agreement provides for
Smith’s execution of this Agreement at the closing of the Transaction in order
to protect the goodwill of INI being purchased by WMB; and
 
WHEREAS, Smith’s agreement to the restrictive covenants contained in this
Agreement is a material inducement to WMB to enter into the Transaction;
 
NOW, THEREFORE, in consideration of the foregoing, the mutual promises herein
contained, and other good and valuable consideration, including the
consideration provided to Smith in connection with the Transaction, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto, intending
to be legally bound, hereby agree as follows.
 
1.   EMPLOYMENT. WMB hereby agrees to employ Smith, and Smith hereby agrees to
accept such employment pursuant to the terms of this Agreement. The commencement
of Smith’s employment shall be effective as of the Closing (as defined in the
Definitive Agreement) (the “Commencement Date”). Smith is hereby assigned to the
position of WMB’s Vice President, Social Media, reporting to WMB’s Chief
Executive Officer, effective as of the Commencement Date.
 
2.   DUTIES; EXCLUSIVE SERVICE. While employed by WMB, Smith shall faithfully
discharge his responsibilities and perform all duties prescribed to him by the
Chief Executive Officer of WMB. Smith agrees to perform all duties assigned to
him by WMB diligently and to the best of his ability. Smith further agrees to
devote all of his working time and attention to the performance of his duties
and responsibilities on behalf of WMB and in furtherance of its best interests.
Smith agrees to comply with all WMB policies, standards and regulations now
existing or hereafter promulgated. While employed by WMB, Smith shall not engage
in other business ventures or employment without the prior written approval of
WMB’s Chief Executive Officer. Smith agrees to immediately resign from any
consultancy, board or other position with any person or entity that engages in
any business that competes with or represents a conflict with the business of
WMB as determined in the sole discretion of WMB’s Chief Executive Officer.
  
 
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3.   COMPENSATION. Smith’s compensation shall be paid as follows:
 
(a)           Base Salary. During the Term of this Agreement, Smith shall
receive as compensation a base salary at an annual rate of $130,000, minus any
federal, state and local payroll taxes and other withholdings legally required
or properly requested by Smith (the “Base Salary”). The Base Salary shall be
payable in accordance with WMB’s regular payroll practices and procedures.
 
(b)           Business Expenses. WMB will pay all reasonable expenses incurred
by Smith directly related to the business of WMB, provided Smith complies with
WMB’s policies and procedures for reimbursement or advance of business expenses
established by WMB.
 
(c)           Benefits. While employed by WMB, Smith shall receive such other
standard benefits as are provided generally from time to time to all other
similarly situated employees of WMB. All such benefits are subject to the
provisions of their respective plan documents in accordance with their terms and
are subject to amendment or termination by WMB without Smith’s consent.
 
4.   TERM AND TERMINATION.
 
(a)           Term. The term of this Agreement shall commence on the
Commencement Date and shall continue until the second anniversary of the
Commencement Date (the “Term”). Following the expiration of the Term, Smith’s
employment with WMB shall continue on an at-will basis unless otherwise agreed
in writing by the parties.
 
(b)           Termination by WMB for Cause. During the Term, WMB shall have the
right to terminate this Agreement for Cause (as defined below) at any time by
giving Smith written notice of such termination. As used herein, “Cause” shall
mean and include: (i) any material act of dishonesty, theft, fraud or
embezzlement committed by Smith in connection with Smith’s responsibilities as
an employee or director of WMB; (ii) failure, refusal or neglect by Smith to
perform in any material respect his duties or responsibilities under this
Agreement; (iii) misappropriation by Smith of any of the assets or business
opportunities of WMB; (iv) Smith’s conviction of, or plea of no contest to, a
felony or other crime involving moral turpitude; (v) Smith’s gross misconduct in
connection with Smith’s responsibilities as an employee that causes or may cause
material harm to WMB; or (vi) Smith’s continued substantial and material
violation of this Agreement; provided, however, if, in WMB’s discretion and
judgment, the circumstance(s) creating grounds for a “for Cause” termination can
be cured, Smith shall receive a written demand for the cure of such
circumstance(s) from WMB that specifically sets forth the factual basis for
WMB’s belief that Smith is subject to a “for Cause” termination, and Smith will
have an opportunity to cure such violation(s) within a period ten (10) days from
receipt of such written demand.
 
(c)           Termination by Smith. During the Term, upon sixty (60) days
written notice delivered by Smith to WMB, Smith may voluntarily choose to
terminate his employment with WMB.
  
 
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(d)           Termination by WMB Without Cause. During the Term, upon sixty (60)
days written notice delivered by WMB to Smith, WMB may terminate this Agreement
for any reason and without Cause.
 
(e)           Termination for Good Reason. During the Term, Smith may terminate
this Agreement for Good Reason (as defined below), provided that Smith has
provided WMB with written notice of such intention to terminate and specifying
the reason for such termination within thirty (30) days of an event qualifying
as Good Reason (as defined below). WMB shall then have thirty (30) days from
receipt of any such written notice from Smith to cure Smith’s grievances. If WMB
has not cured Smith’s grievances in that time period, Smith must terminate this
Agreement within thirty (30) days thereafter. As used herein, “Good Reason”
shall mean the occurrence of any of the following events or conditions: (i) a
material adverse change in, or the assignment to Smith of any duties or
responsibilities which are inconsistent with, Smith’s status, title, position or
responsibilities with WMB; (ii) a reduction in Smith’s salary and/or benefits,
except to the extent such reduction is comparable to percentage reductions in
salary and/or benefits of all other employees of WMB, or any failure to pay
Smith any compensation or benefits to which Smith is entitled within five (5)
days of the date due; (iii) WMB relocates Smith’s workplace more than thirty
(30) miles from Smith’s current workplace; or (iv) any material breach by WMB of
any provision of this Agreement.
 
(f)   Termination Due to Death or Disability. During the Term, this Agreement
and Smith’s employment hereunder shall be deemed terminated automatically
immediately upon Smith’s death or Disability (as defined below). As used herein,
“Disability” shall mean Smith’s inability to perform the essential functions of
his job, with or without a reasonable accommodation, for a period of ninety (90)
days within any twelve (12) month period.
 
5.           Termination Payments.
 
(a)           No Payments. In the event of any termination of this Agreement
during the Term by WMB for Cause pursuant to Section 4(b) or voluntarily by
Smith pursuant to Section 4(c) or due to Smith’s death or Disability pursuant to
Section 4(f), WMB shall have no further payment obligations to Smith hereunder,
except for wages and benefits accrued through the date of termination and/or as
required by applicable law. Following the expiration of the Term, Smith’s
employment, if continued, shall be “at will,” and WMB will have no payment
obligations to Smith upon the termination of Smith’s employment for any reason
by either party, except for wages and benefits accrued through the date of
termination and/or as required by applicable law.
 
(b)           Continued Payments. If, during the Term, this Agreement is
terminated by WMB without “Cause” pursuant to Section 4(d) or by Smith for “Good
Reason” pursuant to Section 4(e), then, provided that (i) within 55 days of
termination of employment Smith executes and does not revoke a general release
of any employment-related claims against WMB, in a form acceptable to WMB and
(ii) Smith does not violate any provision of this Agreement (including Section
6) for the period remaining in the Term, WMB shall pay to Smith as severance, in
addition to all wages and benefits accrued through the date of termination
and/or as required by applicable law, Smith’s annual Base Salary for the period
remaining in the Term. All payments hereunder shall be minus customary and
applicable withholdings and payable in accordance with WMB’s customary payroll
practices.
  
 
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6.           RESTRICTIVE COVENANTS. In exchange for the consideration provided
to Smith in connection with the Transaction, as well as other consideration
described herein, while employed by WMB (except as authorized in the course of
performing duties on behalf of WMB), and for three (3) years after the
termination of Smith’s employment with WMB by either party for any reason
whatsoever, Smith agrees not to:
 
(a)           engage in, manage, operate, control, supervise, have an ownership
or financial interest (other than as a shareholder of less than 5% of the
outstanding shares of a publicly traded company), or participate in the
management, operation, control or supervision of, any business or entity engaged
in the Restricted Business (as defined below) in the Protected Territory (as
defined below);
 
(b)           be employed or engaged by any business or entity engaged in the
Restricted Business in or targeting the Protected Territory in a position where
Smith has substantially the same title, authority and/or duties or work as Smith
had while employed by WMB pursuant to this Agreement or otherwise;
 
(c)           be employed or engaged by any business or entity engaged in the
Restricted Business in or targeting the Protected Territory in a position where
Smith or his employer could benefit from the use or disclosure of WMB’s
Confidential Information (as defined below);
 
(d)           directly or indirectly call on or otherwise contact customers with
whom Smith had any business contacts on behalf of WMB during the twelve (12)
months prior to termination for the purpose of selling products or services to
such customers that are competitive with those provided by WMB;
 
(e)           directly or indirectly contact, solicit, interfere with or attempt
to entice in any form, fashion or manner any employee or consultant of WMB: (i)
for the purpose of inducing that employee or consultant to work with or for
Smith (or with a person or business entity with which Smith is affiliated); or
(ii) to terminate his, her or its employment or engagement with WMB; and/or
 
(f)           directly or indirectly contact, solicit, interfere with or attempt
to entice in any form, fashion or manner any vendor of WMB: (i) for the purpose
of inducing that vendor to work with or for Smith (or with a person or business
entity with which Smith is affiliated); or (ii) to terminate his, her or its
vendor relationship with WMB.
 
Smith further agrees that for three (3) years after termination of employment by
either party for any reason whatsoever, Smith will provide written notice to WMB
of the name and address of any other employer with whom Smith commences
employment as soon as reasonably practical, and in no case later than five (5)
business days after commencement of such employment.
 
For purposes of this Agreement, the “Restricted Business” is defined as any
company or business entity that provides the development, publishing, marketing,
distribution, creation, licensing or sale of any business, product, service or
venture that is substantially similar to the principal products, services,
content or focus of INI’s business, and specifically including:
  
 
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(i)    operating or promoting any Internet web sites substantially similar to,
in form or content, the web sites located at the uniform resource locators:
 
insidenetwork.com
insidefacebook.com
insidevirtualgoods.com
insidemobileapps.com
insidesocialgames.com
appdata.com; and
insidesocialapps.com.
 
(ii)    operating or promoting any Internet web sites substantially similar to,
in form or content, the web sites located at the uniform resource locators:
allfacebook.com, socialtimes.com, alltwitter.com and allfacebookstats.com; and
 
(iii)   writing any articles, blog posts or content, or operating or promoting
any Internet web site or blog, or other paper or electronic product or service
that is similar to, or has any content or features similar to, or is likely to
compete or interfere with, or injure the value or prospects of INI’s social
media business, which, for the avoidance of doubt shall include any Web
site/blog primarily about social media, Facebook, social games, virtual goods or
mobile applications (apps) or as a regular feature on any Web site or blog; and
 
(iv)   operating, organizing or promoting events, conferences, tradeshows,
webinars or education on Facebook, social media or applications (apps),
including, without limitation, any event similar to the Inside Social Apps, “FMB
2009” or Facebook Marketing Breakfast Series events held by INI; and
 
(v)    operating, writing, conducting or promoting any research or statistics
product or service related to Facebook or applications (apps).
 
For purposes of this Agreement, the “Protected Territory” is defined as (i) the
United States; (ii) Europe; (iii) China; (iv) Japan; (v) Singapore; (vi) Brazil;
(vii) India; (viii) Australia; (ix) Canada; (x) the United Kingdom; and (xi)
Russia.
 
7.           NONDISCLOSURE. Smith will not at any time, whether during or after
the termination of his employment for whatever reason, reveal to any person or
entity any of the trade secrets or confidential information concerning the
organization, business or finances of WMB or of any third party that WMB is
under an obligation to keep confidential (the “Confidential Information”),
except as may be required in the ordinary course of performing his duties as an
employee of WMB. For purposes of this Agreement, Confidential Information shall
include but is not limited to WMB’s trade secrets or other information
respecting inventions, research, products, designs, methods, know-how, formulae,
techniques, systems, processes, sensitive strategic or financial information,
works of authorship, customer lists, prospect lists, customer pricing and order
data, marketing plans, projects, plans, proposals, or other technical
information. Smith shall keep secret all Confidential Information and/or other
matters entrusted to him and shall not use or attempt to use any such
Confidential Information in any manner that is reasonably likely to injure or
cause loss to WMB. The foregoing shall not apply to any information that (a) is
in the public domain, (b) was already known to Smith prior to his initial
employment by INI, (c) is disclosed to Smith by a third party under no
obligation of confidentiality to WMB, or (d) that Smith is required to disclose
pursuant to a valid order of a court or other governmental body, provided that
Smith first notifies WMB of the existence and terms of such order, gives WMB a
reasonable opportunity to seek a protective or similar order to prevent or limit
such disclosure, and only discloses that information actually required to be
disclosed pursuant to such order.
  
 
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8.           ASSIGNMENT OF DEVELOPMENTS. If at any time or times during Smith’s
employment, Smith shall (either alone or with others) make, conceive, discover
or reduce to practice any idea, concept, invention, modification, discovery,
design, development, improvement, process, software program, work of authorship,
documentation, formula, data, technique, know-how, secret or intellectual
property right whatsoever or any interest therein (whether or not patentable or
registrable under copyright or similar statutes or subject to analogous
protection) (herein called “Developments”) that relates to the business of WMB
or any of the products or services being developed, manufactured or sold by WMB,
such Developments and the benefits thereof shall immediately become the sole and
absolute property of WMB and its assigns, and Smith shall promptly disclose to
WMB each such Development and hereby assigns any rights Smith may have or
acquire in the Developments and benefits and/or rights resulting therefrom to
WMB and its assigns without further compensation and shall communicate, without
cost or delay, and without publishing the same, all available information
relating thereto to WMB.
 
Upon the request of WMB, Smith will execute and deliver all documents and do
other acts which are or may be necessary to document such transfer or to enable
WMB to file and prosecute applications for and to acquire, maintain, extend and
enforce any and all patents, trademark registrations or copyrights under United
States or foreign law with respect to any such developments. In the event WMB is
unable for any reason, after reasonable effort, to secure Smith’s signature on
any document needed in connection with the actions specified in this Section 8,
Smith hereby irrevocably designates and appoints WMB and its duly authorized
officers and agents as Smith’s agent and attorney in fact, which appointment is
coupled with an interest, to act for and in Smith’s behalf to execute, verify
and file any such documents and to do all other lawfully permitted acts to
further the purposes of such section with the same legal force and effect as if
executed by Smith. Smith hereby waives and quitclaims to WMB any and all claims,
of any nature whatsoever, which Smith now or may hereafter have for infringement
of any Development assigned hereunder to WMB.
 
Smith represents that the Developments, if any, identified on Exhibit A hereto
comprise all the unpatented and uncopyrighted Developments that Smith has made
or conceived prior to Smith’s employment by WMB, which Developments are excluded
from this Agreement. Smith understands that it is necessary only to list the
title and purpose of such Developments but not details thereof.
 
9.           ENFORCEMENT. Smith acknowledges and agrees that the provisions of
Sections 6, 7 and 8 (hereinafter, the “Covenants”) hereof are exchanged for
valid consideration and are reasonably necessary to the protection of WMB’s
business, that a violation of any of the Covenants of this Agreement would
result in immediate and irreparable harm to WMB and that WMB’s remedies at law
and/or the award of monetary damages would be inadequate relief for such a
violation. Therefore, Smith’s violation or threatened violation of any of the
Covenants will give WMB the right to enforce the Covenants through specific
performance, temporary restraining order, preliminary or permanent injunction,
and other equitable relief. These remedies will be cumulative and in addition to
any other remedies that WMB may have.
  
 
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10.           SURVIVAL OF COVENANTS. The provisions set forth in the Covenants
hereof shall survive the termination of this Agreement and any period of
applicability stated therein shall be extended to the extent of any period of
time during which the Smith is in violation thereof.
 
11.           RETURN OF WMB PROPERTY. Upon the termination of Smith’s employment
with WMB for any reason, Smith shall return to WMB all personal property
belonging to WMB (“WMB Property”) that is in Smith’s possession or control as of
the date of such termination of employment, including, without limitation, all
records, papers, drawings, notebooks, specifications, marketing materials,
software, reports, proposals, equipment, or any other device, document or
possession, however obtained, whether or not such WMB Property contains
Confidential Information. Such WMB Property shall be returned in the same
condition as when provided to Smith, reasonable wear and tear excepted.
 
12.           SMITH’S REPRESENTATIONS.
 
(a)           Smith represents that his performance of all of the terms of this
Agreement does not and will not breach any arrangement to keep in confidence
information acquired by Smith in confidence or in trust prior to Smith’s
employment by WMB. Smith represents that he has not entered into, and agrees not
to enter into, any agreement either oral or written in conflict herewith.
 
(b)           Smith understands as part of the consideration for this Agreement
and for Smith’s employment or continued employment by WMB, that Smith has not
brought and will not bring with Smith to WMB, or use in the performance of
Smith’s duties and responsibilities for WMB or otherwise on its behalf, any
materials or documents of a former employer or other owner which are generally
not available to the public, unless Smith has obtained written authorization
from the former employer or other owner for their possession and use and has
provided WMB with a copy thereof.
 
(c)           Smith understands that during his employment for WMB he is not to
breach any obligation of confidentiality that Smith has to a former employer or
any other person or entity and agrees to comply with such understanding.
 
13.           SECTION 409A. The intent of the parties is that the payments and
benefits under this Agreement comply with or be exempt from Section 409A of the
Internal Revenue Code, and the regulations and guidance promulgated thereunder
(collectively, “Section 409A”) and, accordingly, to the maximum extent
permitted, this Agreement shall be interpreted to be in compliance therewith. A
termination of employment shall not be deemed to have occurred for purposes of
any provision of this Agreement providing for the payment of any amounts or
benefits subject to Section 409A upon or following a termination of employment
unless such termination is also a “separation from service” within the meaning
of Section 409A, and for purposes of any such provision of this Agreement,
references to a “resignation,” “termination,” “terminate,” “termination of
employment” or like terms shall mean “separation from service” (within the
meaning of Section 409A).
 
15.           SEVERABILITY. Smith hereby agrees that each provision herein shall
be treated as a separate and independent clause, and the unenforceability of any
one clause shall in no way impair the enforceability of any of the other clauses
herein.
  
 
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16.           NOTICES. Any notice required to be given hereunder shall be
sufficient if in writing and sent by certified or registered mail, return
receipt requested, first-class postage prepaid, in the case of Smith, to his
address last shown on WMB’s records, and in the case of WMB, to its principal
office in the State of Connecticut.
 
17.           WAIVER. Any waiver by WMB or Smith of a breach of any provision of
this Agreement shall not operate or be construed as a waiver of any subsequent
breach of such provision or any other provision hereof.
 
18.           AFFILIATES; ASSIGNMENT; BINDING EFFECT. The term “WMB” shall also
include any of WMB’s subsidiaries, subdivisions or affiliates. Neither of WMB
nor Smith may assign any of its or his rights or delegate any of its or his
duties under this Agreement; provided, that WMB may assign its rights or
delegate its duties hereunder to its affiliates. This Agreement shall be binding
upon and shall inure to the benefit of each of the parties hereto, and to their
respective heirs, representatives, successors and permitted assigns.
 
19.           ENTIRE AGREEMENT. This Agreement is the final, complete and
exclusive agreement of the parties with respect to the subject matter hereof and
supersedes and merges all prior discussions between the parties. No modification
of or amendment to this Agreement, nor any waiver of any rights under this
Agreement, will be effective unless in writing and signed by each of the parties
hereto.
 
20.           GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of California, without regard to that
body of law known as choice of law, and any suit, action or charge arising out
of or relating to this Agreement will be adjudicated in the state or federal
courts in San Francisco County, California.
 
21.           COUNTERPARTS.  This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which taken
together constitute one agreement.
 
[Signature page follows.]
  
 
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IN WITNESS WHEREOF, the parties have executed this Employment Agreement
effective as of the day and year first above written.
  
  

  WebMediaBrands Inc.          
 
By:
/s/ Alan Meckler       Name: Alan Meckler       Title: CEO                    
EMPLOYEE           /s/ Justin L. Smith      Justin L. Smith                  

 
 
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