EXHIBIT 99.2
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated as of December 31 2004, between
Xxxxx Xxxxxxxxx (the "Employee") and First South Africa Management Corp., a
Delaware corporation (the "Company").
WHEREAS, the Company desires to employ the Employee, and the
Employee desires to be employed by the Company, all upon the terms and
provisions and subject to the conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants and agreements contained herein, and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto hereby agree as follows:
1. Employment and Term.
The Company hereby employs the Employee as the Chief Executive
Officer, President, Chief Financial Officer of the Company and the Employee
hereby accepts such employment, upon the terms and provisions and subject to the
conditions set forth below for a term commencing on the date hereof (the
"Commencement Date") and terminating on January December 31, 2009, unless sooner
terminated as herein provided (the "Employment Term").
2. Employee's Duties.
(a) The Employee shall perform all duties and services incident to and
not inconsistent with Employee's positions with the Company, including, but not
limited to, those duties as are assigned to such offices in the Company's
by-laws, and such other duties as may from time to time be assigned to him by
the Board of Directors of the Company and/or the Board
of Directors of .Silverstar Holdings Ltd, the owner of 100% of the capital stock
of the Company ("SSTR"), subject in all cases to the authority and supervision
of the Board of Directors of the Company and SSTR.
(b) The Employee agrees to abide by all policies promulgated from time
to time by the Company.
(c) The Employee shall devote substantially all of his business time,
effort and attention to the business and affairs of the Company, and to the
furtherance of the interests of the business of the Company. The Employee shall
diligently and faithfully perform his duties and services hereunder to the best
of his ability and with the highest of professional standards and integrity.
3. Compensation for Employee's Services.
(a) For the full, prompt and faithful performance of the duties and
services to be performed by the Employee pursuant to Sections 1 and 2 hereof,
the Company agrees to pay, and the Employee agrees to accept, an annual base
salary (the "Base Salary") of $325,000 for the period from January 1, 2005
through December 31, 2005, $335,000 for the period from January 1 2006 through
December 31, 2006, $350,000 for the period from January 1 2007 through December
31, 2009. All amounts paid hereunder shall be reduced by all necessary and
required federal, state and local payroll deductions. The Base Salary shall be
paid in accordance with the usual payroll practices of the Company.
(b) The Employee shall be entitled to four (4) weeks vacation in each
calendar year. The Employee shall take such vacation at such time or times as
shall be mutually agreed upon with the Company.
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(c) During the Employment Term, the Employee shall be entitled to such
insurance, and health and medical benefits as are from time to time in effect
pursuant to the policies of the Company and/or SSTR (or any subsidiaries of
either of the foregoing); provided, however, that the Employee shall be required
to comply with the conditions attendant to coverage and shall comply with and be
entitled to benefits only in accordance with the terms and conditions of such
coverage. The Company may withhold from any benefits payable to the Employee all
federal, state, local or other taxes and amounts as shall be permitted or
required pursuant to law, rule or regulation.
(d) During the Employment Term, the Employee shall be eligible to
participate in the pension, compensation and bonus plans or programs that from
time to time are made available to other employees of the Company and/or SSTR
(or any subsidiaries of either of the foregoing), subject to any applicable
waiting periods, all in accordance with the terms and provisions of such plans
or programs.
(e) During the Employment Term, the Company shall pay all expenses
incurred by Employee in connection with the lease or ownership of an automobile
to be used primarily for Company business, and for all related expenses.
(f) During the Employment Term, the Employee shall be entitled to an
annual bonus (the "Bonus") in an amount to be determined by the Company's Board
of Directors and Compensation Committee based on the results of operations of
the Company for each fiscal year starting in the fiscal year ending June 30,
2006. The Employee hereby acknowledges that the payment of his bonus will be
dependent upon the Company's net income from operations achieving a rate of
return on its equity of not less than 20% annually.
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4. Expenses.
The Employee shall be entitled to reimbursement for his ordinary and
necessary reasonable business expenses actually incurred during the Employment
Term in the performance of his duties under Section 2 of this Agreement, if and
to the extent supported by such reasonable documentation as may be requested by
the Company.
5. Termination of Employment Term.
(a) In the event of the death, or the permanent mental or physical
disability (as determined in good faith by the Company on the basis of the
factors set forth in Section 5(b)(iii) hereto), of the Employee during the term
of his employment, the Employee's employment under Sections 1 and 2 hereof shall
terminate and this Agreement shall terminate on the date of such death or
termination resulting from such disability; provided, however, that the
Employee, his estate or legal representative, as the case may be, shall be
entitled to receive, and the Company shall pay, any unpaid Base Salary and Bonus
and other benefits and reimbursable expenses accrued and owing to the Employee
with respect to his employment prior to his death or termination resulting from
disability.
(b) The Company shall have the right to terminate the Employee's
employment under Sections 1 and 2 hereof and to terminate this Agreement, in the
event: (i) the Employee fails to substantially perform or repeatedly neglects
his duties assigned in accordance with this Agreement in any continuing manner
after notice from the Company of such failure or neglect; (ii) the Employee
willfully fails or refuses to substantially follow or comply with the directions
of the Board of Directors of the Company or SSTR or the policies or work rules
of the Company; (iii) the Employee shall be unable (as determined in good faith
by the Company) to
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substantially perform his duties under this Agreement for a period of forty-five
(45) consecutive days, or ninety (90) days in total in any six-month period,
whether because of illness or mental or physical disability; (iv) the Employee
through his intentional action or inaction has subjected the Company or SSTR or
any of their respective subsidiaries to any criminal or civil liability under
any applicable law; (v) the Employee is convicted for any misdemeanor involving
moral turpitude or any felony; (vi) the Employee has misappropriated any asset
or property of the Company or SSTR or any of their respective subsidiaries,
including (without limitation) any theft or embezzlement or any diversion of any
corporate opportunity; or (vii) the Employee has breached any of his covenants
and agreements contained in this Agreement, including (without limitation) those
contained in Section 7 hereof, provided, however, that the Company shall be
entitled to terminate this Agreement under this Section 5(b) only if the
Employee shall have failed to cure any of the above events within 30 days of the
Employee's receipt of the Company's written notice stating its intent to
terminate this Agreement and setting forth its reasons therefor. The Employee
acknowledges and agrees that any of the foregoing reasons constitute adequate
and sufficient cause for termination, and if the Company elects such
termination, the Employee shall be entitled to receive only such Base Salary,
Bonus, benefits and reimbursable expenses accrued and owing to the Employee at
the date of such termination (which, however, shall be subject to offset by the
Company with respect to all amounts then owing to the Company or SSTR or any of
their respective subsidiaries by the Employee, including amounts respecting
misappropriated assets and properties).
(c) Any termination under this Section or termination of Employee's
duties under Sections 1 and 2 of this Agreement, whether by the Employee
(pursuant to Section 6
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hereof) or by the Company, shall be communicated by a notice of termination to
the other party hereto, which shall set forth the facts and circumstances
respecting such termination; provided, however, that no notice of termination
need be given in the event of the death of the Employee.
(d) The Employee acknowledges and agrees that any termination under
this Section is not intended, and shall not be deemed or construed, in any way
to affect any of the Employee's other covenants and obligations contained in
this Agreement, including (without limitation) those contained in Section 7
hereof, which other covenants and agreements shall continue in full force and
effect.
6. Change in Control, Termination of Employment and Compensation in
Event of Termination.
(a) After a direct or indirect Change in Control (as such term is
hereinafter defined) of the Company has occurred, if either the Employee
terminates his employment within six months after he has obtained actual
knowledge of the direct or indirect Change in Control of the Company (or any
successor thereto) or the Employee's employment with the Company is terminated
by a party other than the Employee within one year after the direct or indirect
Change in Control, the Employee (i) shall be entitled to his Base Salary, Bonus,
benefits and reimbursable expenses, accrued through the date the Employee's
employment with the Company is terminated (the "Termination Date") and, in
addition thereto, and (ii) shall be entitled to be paid in a lump-sum, on the
Termination Date, an amount of cash equal to 24 months salary plus accrued but
unearned bonuses.
(b) For purposes hereof, a Change in Control shall be deemed to have
occurred if there has occurred a change in control as the term "control" is
defined in Rule 12b-2
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promulgated under the Securities Exchange Act of 1934, as amended (the "Act"):
(i) when any "person" (as such term is defined in Sections 3(a)(9) and 13(d)(3)
of the Act), except for an employee stock ownership trust (or any of the
trustees thereof), after the date hereof, directly or indirectly, acquires
securities of SSTR representing twenty percent (20%) or more of SSTR's then
outstanding Common Stock, $.01 value per share; (ii) if the stockholders of the
Company or SSTR approve a plan of complete liquidation of the Company or SSTR,
as the case may be; or (iii) if the stockholders of SSTR or the Company approve
an agreement for the sale or disposition of all or substantially all of SSTR's
or the Company's assets. Notwithstanding the foregoing, no Change in Control
shall be deemed to have occurred as a result of any event specified in clauses
(i)-(iii) of this paragraph 6(b) if a majority of the Board of Directors of SSTR
or the Company approve such transaction prior to its occurrence.
7. Restrictions Respecting Confidential Information.
(a) The Employee has entered into the covenants and agreements
contained in this Section (i) in recognition of the competitive and confidential
nature of the assets, properties, information and business of the Company and
SSTR, and (ii) in consideration of the compensation described in this Agreement.
(b) The Employee hereby covenants and agrees that, during the
Employment Term and thereafter, the Employee will not directly or indirectly,
under any circumstance without the prior written consent of an authorized
officer of the Company: (i) disclose or reveal in any way other than for the
benefit of SSTR and its affiliates, directly or indirectly, any Confidential
Information (as hereinafter defined) to any other person, firm or company; (ii)
use in any way, directly or indirectly, any Confidential Information for the
benefit of any
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other person or entity other than the Company or its affiliates, or (iii) offer
or agree to, or cause or assist in the initiation or continuation of, any
disclosure of any Confidential Information for the benefit of the Employee or
any third party. For the purposes of the foregoing, "Confidential Information"
shall mean any and all information pertaining to SSTR, the Company or any of
their respective subsidiaries or affiliates, or the business activities and
affairs thereof or of any officer, director or employee thereof in such
capacity, or any activities of, or any knowledge or information learned by the
Employee, provided, however, that Confidential Information shall exclude any
information that is or becomes publicly available (other than through any
disclosure in violation of this Section by the Employee or any persons or entity
acting on the Employee's behalf). Following the Termination Date, the Employee
shall immediately return to SSTR or the Company, as the case may be, all
documents and other tangible items containing any Confidential Information and
all other corporate books and records of SSTR or the Company, as the case may
be, now or hereafter in its possession, custody or control or provide a written
accounting of the disposition of any such Confidential Information that he shall
have received and that shall not be returned to the Company under this Section
7.
(c) Notwithstanding anything to the contrary in this Agreement, the
terms and provisions of this Section and Sections 8 through 18 of this
Agreement, together with any definitions used in such terms and provisions,
shall survive the termination or expiration of the Employee's employment under
Sections 1 and 2 hereof, irrespective of (i) the reason therefor, and (ii)
whether such termination was permitted hereunder or under applicable law, and
the Company will have the right to communicate with any future or prospective
employer concerning Employee's continuing obligations under this Agreement.
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8. Enforcement.
The Company may proceed to exercise or enforce any right,
power, privilege, remedy or interest that the Company may have under this
Agreement or applicable law (at law, in equity, in rem or in any other forum
available under applicable law); without notice except as otherwise expressly
provided herein; without pursuing, exhausting or otherwise exercising or
enforcing any other right, power, privilege, remedy or interest that the Company
may have against or in respect of the Employee or any other person or thing; and
without regard to any act or omission of the Company or any other person. The
Company may institute one or more proceedings (which may be separate
proceedings) with respect to this Agreement in such order and at such times as
the Company may in its sole discretion elect.
9. Equitable Relief.
The Employee acknowledges and agrees that it will be impossible to
measure in money the damage to the Company in the event of a breach of any of
the terms and provisions of Section 7 of this Agreement, and that, in the event
of any such breach, the Company will not have an adequate remedy at law,
although the foregoing shall not constitute a waiver of any of the Company's
rights, powers, privileges and remedies against or in respect of a breaching
party or any other person or thing under this Agreement, or applicable law. It
is therefore agreed that the Company, in addition to all other such rights,
powers, privileges and remedies that they may have, shall be entitled to
injunctive relief, or such other equitable relief as the Company may request to
exercise or otherwise enforce. The Employee will not raise and hereby waives any
objection or defense that there is an adequate remedy available at law.
10. Representations and Warranties of Employee.
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(a) In order to induce the Company to enter into this Agreement, the
Employee represents and warrants to the Company that: (i) the execution and
delivery of this Agreement by the Employee and the performance of his
obligations hereunder will not violate or be in conflict with any fiduciary or
other duty, instrument, agreement, document, arrangement or other understanding
to which the Employee is a party or by which he is or may be bound or subject;
and (ii) the Employee is not a party to any instrument, agreement, document,
arrangement or other understanding with any person (other than the Company)
requiring or restricting the use or disclosure of any confidential information.
(b) The Employee hereby agrees to indemnify and hold harmless the
Company, from and against any and all losses, costs, damages and expenses
(including without limitation, their reasonable attorneys' fees) incurred or
suffered by the Company resulting from any breach by the Employee of any of his
representations or warranties set forth in Section 10(a) hereof.
11. Notice.
Except as otherwise expressly provided, any notice, request, demand or
other communication permitted or required to be given hereunder shall be in
writing, shall be sent by one of the following means to the addressee at the
address set forth below (or at such other address as shall be designated
hereunder by notice to the other party hereto, effective upon actual receipt)
and shall be deemed conclusively to have been given: (i) on the first business
day following the day timely deposited with Federal Express (or other equivalent
express overnight courier) or United States Express Mail, with the cost of
delivery prepaid or for the account of the sender; (ii) on the fifth business
day following the day duly sent by certified or registered mail,
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postage prepaid and return receipt requested; or (iii) when otherwise actually
received by the addressee on a business day (or on the next business day if
received after the close of normal business hours or on any non-business day).
If to the Employee:
c/o First South Africa Management Corp.
0000 Xxxxxx Xxxx
Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
Facsimile No.: (000) 000-0000
If to the Company:
First South Africa Management Corp.
0000 Xxxxxx Xxxx
Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxx X. Xxxxxxx, Esq.
Xxxxxxxx Xxxxxxx LLP
The Chrysler Building
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (000) 000-0000
If a certificate, signed notice or other signed item is expressly required by
another provision of this Agreement, a manually signed original must be
delivered by the party giving it; any other notice, request, demand or other
communication also may be sent by telecopy, with the cost of transmission
prepaid or for the account of the sender, and shall (except as otherwise
specified in this Agreement) be deemed conclusively to have been given on the
first business day following the day duly sent.
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12. Section and Other Headings.
The section and other headings contained in this Agreement are for
reference purposes only and shall not affect the meaning or interpretation of
this Agreement.
13. Governing Law.
This Agreement shall be governed by and construed in accordance with
the applicable laws of the State of Delaware without reference to the conflict
of law principles thereof.
14. Severability.
In the event that any term or provision of this Agreement shall be
finally determined to be superseded, invalid, illegal or otherwise unenforceable
pursuant to applicable law by a governmental authority having jurisdiction and
venue, that determination shall not impair or otherwise affect the validity,
legality or enforceability, to the maximum extent permissible by law, (a) by or
before that authority of the remaining terms and provisions of this Agreement,
which shall be enforced as if the unenforceable term or provision were deleted,
or (b) by or before any other authority of any of the terms and provisions of
this Agreement. If any provision of Section 7 hereof is held to be unenforceable
because of the scope or duration of any such provision, the parties agree that
any court making such determination shall have the power to reduce the scope or
duration of such provision, and said provision shall be enforceable in such
reduced form.
15. Counterparts.
This Agreement may be executed in a number of counterpart copies of the
entire document or of signature pages to the document, each of which may be
executed by one of the
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parties hereto, but all of which, when taken together, shall constitute a single
agreement binding upon each of the parties hereto. 16. Successors and Assigns;
Assignment.
Whenever in this Agreement reference is made to any party, such
reference shall be deemed to include the successors, assigns, heirs and legal
representatives of such party, and, without limiting the generality of the
foregoing, all representations, warranties, covenants and other agreements made
by or on behalf of the Employee in this Agreement shall inure to the benefit of
the successors and assigns of the Company, as the case may be; provided,
however, that nothing herein shall be deemed to authorize or permit the Employee
to assign any of his rights or obligations under this Agreement to any other
person (whether or not a family member of the Employee), and the Employee
covenants and agrees that he shall not make any such assignment. 17.
Modification, Amendment, Etc.
Each and every modification and amendment of this Agreement shall be in
writing and signed by all of the parties hereto, and each and every waiver of,
or consent to any departure from, any representation, warranty, covenant or
other term or provision of this Agreement shall be in writing and signed by each
affected party hereto.
18. Entire Agreement.
This Agreement contains the entire agreement of the parties and
supersedes all other representations, warranties, agreements and understandings,
oral or otherwise, among the parties with respect to the matters contained
herein. This Agreement supersedes and terminates
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that certain Employment Agreement dated January 29, 1996 between the Employee
and the Company.
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IN WITNESS WHEREOF, the parties hereto have executed and
delivered this Agreement as of the date first above written.
/s/ Xxxxx Xxxxxxxxx
-------------------------------------
Xxxxx Xxxxxxxxx
First South Africa Management Corp.
By: /s/ Xxxxx Xxxxxxxxx
---------------------------------
Name: Xxxxx Xxxxxxxxx
Title: CEO
Payment to the Employee under Section 6 of this Agreement is hereby guaranteed
by the undersigned:
Silverstar Holdings, Ltd.
By: /s/ Xxxxxxx Xxxx
---------------------------------
Name: Xxxxxxx Xxxx
Title: Chairman of the Board
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