EXHIBIT 10.9
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into
this __ day of July, 1999, by and between DSA Computers, Inc., a Florida
corporation (the "Company"), and Xxxxx Xxxx ("Executive").
WITNESSETH:
WHEREAS, the Company recognizes the experience and knowledge of the
Executive in the computer and related services industry, and wishes to retain
the valuable services of the Executive,
WHEREAS, the Executive wishes to accept employment with the Company
under the terms and conditions set forth herein; and
WHEREAS, the Executive is uniquely experienced and qualified to perform
certain employment services for the Company, and the value of the services to be
provided by the Executive are considered to be so unique and vital to the
Company's business, that the parties are entering into this Agreement which
provides generous consideration for the Executive, performance obligations for
the Executive and protective covenants for the Company and Executive; and
WHEREAS, the Company is a wholly-owned subsidiary of USA Digital, Inc.,
a Nevada corporation ("USA Digital").
NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements herein contained, and intending to be legally bound hereby, Company
and Executive agree as follows:
1. OFFICE AND DUTIES:
1.1 For the term of this Agreement as herein defined, Company hereby
employs, engages and hires Executive to serve as President of the Company. The
Executive shall have the powers and shall perform the specific duties as set
forth on the job description attached hereto as ATTACHMENT A, and such other
duties as delegated to Executive by the Chief Executive Officer of the Company.
The Executive hereby accepts such employment. It is hereby agreed between the
parties that primary responsibility for the supervision of the Executive shall
rest with the Chief Executive Officer of the Company, who shall review the
Executive's performance annually, make upward adjustment's to Executive's
compensation and award such other bonuses and employee benefits as he shall deem
appropriate and as set forth in this Agreement.
1.2 To assist Executive in performing Executive's duties, the Company
shall ensure that Executive is provided, in a timely manner, all reasonable
resources necessary for the accomplishment of Executive's duties.
2. TERM AND TERMINATION. This Agreement shall be effective July _, 1999
("Effective Date"), and shall remain in full force and effect for five (5) years
from the Effective Date, unless the Agreement is terminated sooner by the
parties pursuant to subsection 2.1 or 2.2 below.
2.1 Termination With Cause. This Agreement may be terminated by the
Company or the Executive for the following: (a) upon the other party's material
default or breach of any of its obligations hereunder, if such default or breach
remains uncorrected for a period of fifteen (15) days after the receipt by the
defaulting party of written notice of such default or breach; (b) upon the gross
negligence or willful misconduct of the other party during the term of this
Agreement, which is materially damaging to the Company or Executive, if such
gross negligence or misconduct remains uncorrected for a period of fifteen (15)
days after the receipt by the Company or Executive of written notice of such
negligence or misconduct; (c) upon the conviction of the Company or the
Executive during the term of this Agreement of a crime involving breach of trust
or moral turpitude; or (d) upon Executive's death. In the event that the Company
discharges the Executive alleging "cause" under this Section 2.1, such notice of
discharge shall be accompanied by a written and specific description of the
circumstances alleging such "cause". Further, in the event that the Company
discharges the Executive alleging "cause" under this Section 2.1, and it is
subsequently determined judicially that the termination was "without cause",
then such discharge shall be deemed a discharge without cause subject to the
provisions of Section 2.2 hereof.
2.2 Termination Without Cause. The Company or the Executive may, upon
sixty (60) days prior written notice to the other party, terminate this
Agreement without cause at any time commencing one year after the date of this
Agreement until expiration of this Agreement. If the Company terminates the
Executive without cause, the Company shall pay the Executive, as liquidated
damages in lieu of all other claims arising directly out of the Executive's
employment, an amount equal to the Base Salary which would otherwise be payable
to Executive for the remaining term of the Agreement, plus any bonuses which the
Executive would have earned if the Executive had remained employed by the
Company through the end of the bonus period then in effect, based upon a
reasonable extrapolation of the financial statements of the Company at the time
of such termination. Any such payments shall, at the option of the Company, be
made either in equal bi-monthly installments over the remaining term of this
Agreement, or in a lump sum cash payment on the date of termination. Further,
upon termination of the Executive without cause, all benefits of the Executive
which are in effect at the time of such termination shall remain in full force
and effect through the end of the original term of this Agreement. The
Liquidated damages payments and benefits due to the Executive if terminated
without cause as set forth above, are hereby unconditionally guaranteed in full
by USA Digital, Inc., the parent corporation to the Company.
2.3 Effect of Termination. In the event of any termination of this
Agreement pursuant to Section 2.1 or 2.2 hereof, such termination shall not
effect any of the obligations or covenants of any party arising prior to the
date of such termination, including, without limitation, the non-
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solicitation and non-disclosure covenants set forth in Sections 6.1 and 6.3
hereof, all of which shall continue as provided in this Agreement, nor shall
such termination effect any allegations, representations, promises or covenants
contained herein which are expressly made to extend beyond the term of this
Agreement. The Executive shall resign from any office that the Executive may
hold in the Company, and shall cooperate in the transfer of Executive's work
responsibilities to such consultants or employees of Company as may be
designated by the Company.
3. COMPENSATION.
3.1 Base Salary; Bonus. For all services rendered hereunder during the
term of this Agreement, the Executive shall be paid an annual base salary ("Base
Salary") of Sixty-Five Thousand Dollars ($65,000) per year. The Company and the
Executive agree that such base salary is reasonable and is based upon the fair
market rate in the marketplace for similar services by similarly qualified
executives. The Base Salary shall be paid in bi-monthly installments in
accordance with the Company's usual payroll practices. The Executive shall also
be eligible to receive an annual bonus based upon specific Company financial
performance criterion mutually developed by the parties and set forth on
ATTACHMENT B.
3.2 Benefits. During the term of this Agreement, the Executive will be
entitled to those executive benefits consistent with personnel policies and
procedures which now exist or which may be developed for similar executive
employees during the term of this Agreement. In addition, Executive shall be
entitled to receive those benefits set forth on ATTACHMENT C.
3.3 Vacation. Executive shall be entitled to three (3) weeks annual
vacation leave with pay. Vacation shall be scheduled at reasonable times not in
conflict with Executive's duties hereunder.
4. EXECUTIVE REPRESENTATIONS. Executive represents to Company that:
4.1 There are no restrictions, agreements or understandings whatsoever
to which Executive is a party that would prevent or make unlawful the
Executive's execution of this Agreement or the Executive's employment hereunder.
4.2 Executive's execution of this Agreement and Executive's employment
hereunder shall not constitute a breach of any contract, agreement or
understanding, oral or written, to which Executive is a party or by which
Executive is bound.
4.3 Executive will at all times faithfully, industriously and to the
best of Executive's ability, experience and talents perform all of the duties
that may be required of Executive pursuant to the express and implied terms of
this Agreement.
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5. CONTEMPORANEOUS BUSINESS ACTIVITY. In order to assure the consistency of
services provided by Executive, Executive agrees, during the effective terms of
this Agreement, that Executive shall devote such full-time attention to the
performance of the Executive's duties under this Agreement as necessary to
ensure Executive's full and complete compliance with Executive's covenants under
this Agreement. Notwithstanding the foregoing, Executive shall be permitted to
continue his existing relationship with AccuData.
6. NON-COMPETITION/NON-DISCLOSURE.
6.1 Non-Solicitation. During the term of this Agreement and for a
period of twelve (12) months after termination or expiration of this Agreement,
the Executive shall not without the prior written permission of the Company: (a)
directly or indirectly induce or attempt to influence any of Company's or USA
Digital's employees or other staff, including but not limited to their agent,
representatives and independent contractors, to terminate their relationship
with the Company or USA Digital, as the case may be; (b) directly or indirectly
induce or attempt to influence any of the Company's or USA Digital's business
associates, clients, customers, consultants or referral sources to terminate
their relationship with the Company or USA Digital, as the case may be; or (c)
divert or take away any corporate business or professional opportunity of the
Company or USA Digital that the Executive may become aware of during the term of
this Agreement which is competitive with the business of the Company or USA
Digital. This provision shall survive the termination or expiration of this
Agreement.
6.2 Non-Competition. During the term of this Agreement, the Executive
shall not, without the prior written permission of the Company, engage in or
have any interest in any sole proprietorship, partnership, corporation or other
business or be employed by or work for any other person or business entity
(whether as employee, officer, director, partner, agent, security holder,
consultant or otherwise) that directly or indirectly engages primarily in a
business in competition with the Company or USA Digital. Notwithstanding the
foregoing, Executive's relationship with AccuData shall not be deemed to be a
violation of this Section 6.2.
6.3 Non-disclosure. Executive, by virtue of Executive's employment, has
been and will continue to be introduced to confidential and/or proprietary
information concerning the Company and USA Digital, and their respective
operations. Because unauthorized disclosure of such confidential and/or
proprietary information will harm the Company and USA Digital, the Executive
shall not, except with the Company's and USA Digital's express, prior written
consent, directly or indirectly, communicate, disclose, divulge or use, for the
benefit of any person or entity other than the Company or USA Digital, any
information regarding the business, customer and/or client lists of the Company
or USA Digital or any other knowledge or information whether confidential or
proprietary of or about the Company or USA Digital acquired by the Executive
during the term of this Agreement. This Executive further agrees that all work
product produced by the Executive during the term of Executive's employment
shall remain the property of the Company, and may not reproduced or
communicated, disclosed or
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divulged to any person or entity other than the Company or USA Digital. This
provision shall survive the termination or expiration of this Agreement.
6.4 Remedies. The Executive agrees that the Company's and USA Digital's
remedies at law for the Executive's breach of any of these
non-competition/non-disclosure provisions are inadequate and that the Company or
USA Digital may seek relief in equity by way of an injunction restraining any
violation of the non-competition/non-disclosure provisions by the Executive. If
any period of time or geographic area relative to these
non-competition/non-disclosure provisions should be adjudged to be unreasonable
in any proceedings, then the period of time or geographic area shall be reduced
by such amount of time or distance so that such restrictions may be enforced for
such time or geographic area as is adjudged to be reasonable by a court of
competent jurisdiction.
7. MISCELLANEOUS.
7.1 Indulgences, Etc. The failure or any delay on the part of the
Executive or Company to exercise any right, remedy, power or privilege under
this Agreement shall not operate as a waiver thereof. A single or partial
exercise of any right, remedy, power or privilege shall not preclude any further
exercise of the same or of any other right, remedy, power or privilege. A waiver
of any right, remedy, power or privilege with respect to any occurrence shall
not be construed as a waiver of such right, remedy, power or privilege with
respect to any other occurrence.
7.2 Controlling Law. This Agreement and all questions relating to its
validity, interpretation, performance and enforcement shall be governed by and
construed in accordance with the laws of the State of Florida.
7.3 Notice. All notices, requests, demands and other communications
required or permitted under this Agreement and transactions contemplated herein
shall be in writing and shall be deemed to have been duly given, made and
received when delivered against receipt or when sent by United States certified
or registered mail, return receipt requested, postage prepaid, addressed as set
forth below in subparagraphs (a) and (b). In addition, notice by mail shall be
air mail if posted outside the continental United States. Executive and Company
may alter the address to which communications of copies are to be sent by giving
notice of such change of address in conformity with the provisions of this
paragraph for the giving of notice.
(a) If to Company: DSA Computers, Inc.
X.X. Xxx 000000
Xxxxx, Xxxxxxx 00000
Attn: Xxxx X. Xxxx
(b) If to Executive: Xxxxx Xxxx
00000 Xxxxxxxxx 00xx Xxxxxx
0
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
7.4 Binding Nature of Agreement. This Agreement shall be binding upon
and inure to the benefit of Company and its successors and assigns and shall be
binding upon and inure to the benefit of Executive, and Executive's heirs and
legal representatives.
7.5 Provisions Separable. The provisions of this Agreement are
independent of and separable from each other. No provision shall be rendered
invalid or unenforceable by virtue of the fact that for any reason, any one or
more of them may be invalid or unenforceable in whole or in part.
7.6 Entire Agreement. This Agreement contains the entire understanding
between Company and Executive with respect to the subject matter hereof, and
supersedes all prior and contemporaneous agreements and understandings,
inducements or conditions, express or implied, oral or written, except as herein
contained. The express terms hereof control and supersede any course of
performance or usage of the trade or professions inconsistent with any of the
terms hereof. This Agreement may not be modified or amended other than by any
agreement in writing.
7.7 Section Headings. The section headings in this Agreement are for
convenience only and form no part of this Agreement and shall not affect its
interpretation.
7.8 Gender, Etc. Words used in this Agreement, regardless of the number
and gender specifically used, shall be deemed and construed to include any other
number, singular or plural, and any other gender, masculine, feminine or neuter,
as the context requires.
7.9 Number of Days. In computing the number of days for purposes of
this Agreement, all days shall be counted, including Saturdays, Sunday or
holidays; provided, however, that if the final day of any time period falls on a
Saturday, Sunday or holiday, then the final day shall be deemed to be the next
day which is not a Saturday, Sunday or holiday.
7.10 Counterparts. This Agreement may be executed two or more
counterparts, each of which shall be deemed an original, but all of which shall
constitute but one and the same Agreement.
7.11 Assignment. This Agreement may not be assigned by the Executive.
This Agreement may be assigned by the Company to an entity under its control,
directly or indirectly, or the control of its principals without the consent of
the Executive, provided Executive's security herein is not impaired by the
assignment.
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7.12 Construction. This Agreement shall be construed without regard to
any presumption or other rule requiring construction against the party causing
this Agreement to be drafted.
IN WITNESS WHEREOF, the parties hereto have executed this agreement or
caused their duly authorized representatives to execute this Agreement on the
day first stated above.
DSA COMPUTERS, INC.
By:
----------------------------
Xxxx X. Xxxx
Chief Executive Officer
------------------------------
XXXXX XXXX
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ATTACHMENT A
JOB DESCRIPTION
(TO BE DEVELOPED)
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ATTACHMENT B
(BONUS SCHEDULE)
Executive shall receive the following cash bonus based on "Net Profit" of
DSA Computers, Inc., to be paid on a quarterly basis.
10% $0-$50,000
15% $50,001-100,000
20% $100,00+
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ATTACHMENT C
(EXECUTIVE BENEFITS)
1. Executive shall be entitled to receive a monthly car allowance in the amount
of $500.
2. Executive shall be entitled to receive $250 monthly in unaccountable
expenses.
3. Executive shall receive the following stock options in USA Digital on the
date indicated below (the "Date of Issuance") if the employment contract is in
full force and effect on such date. Each of these options shall be exercisable
in whole or in part at any time within five years of the Date of Issuance,
after which time any such options which have not been exercised shall terminate.
These options are in addition to any other options received under any employee
stock option plan.
Options for following
Date of Issuance: number of shares: Exercise Price:
---------------- ---------------- ---------------
July 9, 1999: 25,000 shares $3.00
July 9, 2000: 25,000 shares $5.50
July 9, 2001: 25,000 shares $6.00
July 9, 2002: 25,000 shares $6.50
July 9, 2003: 50,000 shares $7.00
4. The Company shall pay for, or reimburse Executive for, the expenses
related to the MCSE certification.
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