Exhibit 10.3
AMEDORE HOMES, INC.
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT made as of this 5th day of July, 2000 by
and between AMEDORE HOMES, INC., a New York corporation, having an office at
0000 Xxxxxx Xxxx, Xxxxxxxxxxx, Xxx Xxxx 00000 (hereinafter referred to as
"Employer") and XXXXXX X. XXXXXXX, XX., an individual with an address c/o
Amedore Homes, Inc. 0000 Xxxxxx Xxxx, Xxxxxxxxxxx, Xxx Xxxx 00000 (hereinafter
referred to as "Employee");
W I T N E S S E T H:
WHEREAS, Employer employs, and desires to continue to employ,
Employee as Executive Vice President of Employer; and
WHEREAS, Employee is willing to continue to be employed as the
Executive Vice President in the manner provided for herein, and to perform the
duties of Executive Vice President of Employer upon the terms and conditions
herein set forth;
NOW, THEREFORE, in consideration of the promises and mutual
covenants herein set forth it is agreed as follows:
1. Employment of Executive Vice President. Employer
hereby employs Employee as Executive Vice President.
2. Term.
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a. Subject to Section 10 below and further
subject to Section 2(b) below, the term of this Agreement shall commence on the
effective date of the Company's Registration Statement (the "Commencement Date")
and expire three years from such date. Each 12 month period from the
Commencement Date forward during the term hereof shall be referred to as an
"Annual Period." During the term hereof, Employee shall devote substantially all
of his business time and efforts to Employer and its subsidiaries and
affiliates.
b. Subject to Section 10 below, unless the
Board of Directors of the Company (the "Board") of Employer shall determine to
the contrary and shall so notify Employee in writing on or before the end of any
Annual Period or unless the Employee notifies Employer in writing on or before
the end of any Annual Period of his desire not to renew this Agreement, then at
the end of each Annual Period, the term of this Agreement shall be automatically
extended for one (1) additional Annual Period to be added at the end of the then
current term of this Agreement.
3. Duties. The Employee shall perform those functions
generally performed by persons of such title and position, shall attend all
meetings of the stockholders and the Board, shall perform any and all related
duties and shall have any and all powers as may be prescribed by resolution of
the Board, and shall be available to confer and consult with and advise the
officers and directors of Employer at such times that may be required by
Employer. Employee shall report directly and solely to the Board.
4. Compensation.
a. (i) Employee shall be paid a minimum of
$125,000 for each Annual Period thereafter. Employee shall be paid periodically
in accordance with the policies of the Employer during the term of this
Agreement, but not less than monthly.
(ii) Employee is eligible for an annual
bonus, if any, which will be determined and paid in accordance with Schedule A
attached hereto.
b. Employer shall include Employee in its
health insurance program available to Employer's executive officers and shall
pay 100% of the premiums for such program.
c. Employee shall have the right to participate
in any other employee benefit plans established by Employer.
d. Employee shall be entitled to a monthly car
allowance of $600.00.
5. Board of Directors. Employer agrees that so long as this
Agreement is in effect, Employee will be nominated to the Board as part of
management's slate of Directors.
6. Expenses. Employee shall be reimbursed for all of his
actual out-of-pocket expenses incurred in the performance of his duties
hereunder, provided such expenses are acceptable to Employer, which approval
shall not be unreasonably withheld, for business related travel and
entertainment expenses, and that Employee shall submit to Employer reasonably
detailed receipts with respect thereto.
7. Vacation. Employee shall be entitled to receive four (4)
weeks paid vacation time after each year of employment upon dates agreed upon by
Employer. Upon separation of employment, for any reason, vacation time accrued
and not used shall be paid at the salary rate of Employee in effect at the time
of employment separation.
8. Secrecy. At no time shall Employee disclose to
anyone any confidential or secret information (not already constituting
information available to the public) concerning the internal affairs or
proprietary business operations of Employer.
9. Covenant Not to Compete. Subject to, and limited by,
Section 11(b), Employee will not, at any time, within an area that is 25 miles
from Albany, New York, during the term of this Agreement, and for one (1) year
thereafter, either directly or indirectly, engage in, with or for any
enterprise, institution, whether or not for profit, business, or company,
competitive with the business (as identified herein) of Employer as such
business may be conducted on the date thereof, as a creditor, guarantor, or
financial backer, stockholder, director, officer, consultant, advisor, employee,
member, inventor, producer, director, or otherwise of or through any
corporation, partnership, association, sole proprietorship or other entity;
provided, that an investment by Employee, his spouse or his children is
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permitted if such investment is not more than four percent (4%) of the total
debt or equity capital of any such competitive enterprise or business and
further provided that said competitive enterprise or business is a publicly held
entity whose stock is listed and traded on a national stock exchange or through
the NASDAQ Stock Market. As used in this Agreement, the business of Employer
shall be deemed to include the development and building of homes and planned
communities.
10. Termination.
a. Termination by Employer
(i) Employer may terminate this Agreement
upon written notice for Cause. For purposes hereof, "Cause" shall mean (A)
engaging by the Employee in conduct that constitutes activity in competition
with Employer; (B) the conviction of Employee for the commission of a felony;
and/or (C) the habitual abuse of alcohol or controlled substances.
Notwithstanding anything to the contrary in this Section 10(a)(i), Employer may
not terminate Employee's employment under this Agreement for Cause unless
Employee shall have first received notice from the Board advising Employee of
the specific acts or omissions alleged to constitute Cause, and such acts or
omissions continue after Employee shall have had a reasonable opportunity (at
least 10 days from the date Employee receives the notice from the Board) to
correct the acts or omissions so complained of. In no event shall alleged
incompetence of Employee in the performance of Employee's duties be deemed
grounds for termination for Cause.
(ii) This agreement automatically shall
terminate upon the death of Employee, except that Employee's estate shall be
entitled to receive any amount accrued under Section 4(a) and the pro-rata
amount payable under Section 4(e) for the period prior to Employee's death and
any other amount to which Employee was entitled of the time of his death.
b. Termination by Employee
(i) Employee shall have the right to terminate his
employment under this Agreement upon 30 days' notice to Employer given within 90
days following the occurrence of any of the following events (A) through (F) or
within three years following the occurrence of event (G):
(A) Employee is not elected or retained
as Chief Executive Officer, Chairman and President.
(B) Employer acts to materially reduce
Employee's duties and responsibilities hereunder. Employee's duties and
responsibilities shall not be deemed materially reduced for purposes hereof
solely by virtue of the fact that Employer is (or substantially all of its
assets are) sold to, or is combined with, another entity, provided that Employee
shall continue to have the same duties and responsibilities with respect to
Employer's business, and Employee shall report directly to the chief executive
officer and/or board of directors of the entity (or individual) that acquires
Employer or its assets.
(C) Employer acts to change the
geographic location of the performance of Employee's duties from the Capital
Region of New York State. For purposes of this Agreement, Capital Region of New
York State shall be deemed to be the area within 35 miles of Albany, New York.
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(D) A Material Reduction (as hereinafter
defined) in Employee's rate of base compensation, or Employee's other benefits.
"Material Reduction" shall mean a ten percent (10%) differential;
(E) A failure by Employer to obtain the
assumption of this Agreement by any successor;
(F) A material breach of this Agreement
by Employer, which is not cured within thirty (30) days of written notice of
such breach by Employer;
(G) A Change of Control.
(ii) Anything herein to the contrary
notwithstanding, Employee may terminate this Agreement upon thirty (30) days
written notice.
c. If Employer shall terminate Employee's
employment other than due to his death or disability or for Cause (as defined in
Section 10(a)(i) of this Agreement), or if Employee shall terminate this
Agreement under Section 10(b)(i), Employer's obligations under Section 4 shall
be absolute and unconditional and not subject to any offset or counterclaim and
Employee shall continue to be entitled to receive all amounts provided for by
Section 4 and all additional employee benefits under Section 4 regardless of the
amount of compensation he may earn with respect to any other employment he may
obtain.
11. Consequences of Breach by Employer;
Employment Termination
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a. If this Agreement is terminated pursuant to
Section 10(b)(i) hereof, or if Employer shall terminate Employee's employment
under this Agreement in any way that is a breach of this Agreement by Employer,
the following shall apply:
(i) Employee shall be entitled to
payment of any previously declared bonus and additional compensation as provided
in Section 4(a) and (b) above.
b. In the event of termination of Employee's
employment pursuant to Section 10(b)(i) of this Agreement, the provisions of
Section 9 shall not apply to Employee.
12. Remedies
Employer recognizes that because of Employee's
special talents, stature and opportunities in the home building industry, and
because of the special creative nature of and compensation practices of said
industry and the material impact that individual projects can have on Employer's
results of operations, in the event of termination by Employer hereunder (except
under Section 10(a)(i) or (iii), or in the event of termination by Employee
under Section 10(b)(i) before the end of the agreed term, the Employer
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acknowledges and agrees that the provisions of this Agreement regarding further
payments of base salary, bonuses and the exercisability of Rights constitute
fair and reasonable provisions for the consequences of such termination, do not
constitute a penalty, and such payments and benefits shall not be limited or
reduced by amounts' Employee might earn or be able to earn from any other
employment or ventures during the remainder of the agreed term of this
Agreement.
13. Excise Tax. In the event that any payment or benefit
received or to be received by Employee in connection with a termination of his
employment with Employer would constitute a "parachute payment" within the
meaning of Code Section 280G or any similar or successor provision to 280G
and/or would be subject to any excise tax imposed by Code Section 4999 or any
similar or successor provision then Employer shall assume all liability for the
payment of any such tax and Employer shall immediately reimburse Employee on a
"grossed-up" basis for any income taxes attributable to Employee by reason of
such Employer payment and reimbursements.
14. Arbitration. Any controversies between Employer and
Employee involving the construction or application of any of the terms,
provisions or conditions of this Agreement, save and except for any breaches
arising out of Sections 8 and 9 hereof, shall on the written request of either
party served on the other be submitted to arbitration. Such arbitration shall
comply with and be governed by the rules of the American Arbitration
Association. An arbitration demand must be made within one (1) year of the date
on which the party demanding arbitration first had notice of the existence of
the claim to be arbitrated, or the right to arbitration along with such claim
shall be considered to have been waived. An arbitrator shall be selected
according to the procedures of the American Arbitration Association. The cost of
arbitration shall be born by the losing party or in such proportions as the
arbitrator shall decide. The arbitrator shall have no authority to add to,
subtract from or otherwise modify the provisions of this Agreement, or to award
punitive damages to either party.
15. Attorneys' Fees and Costs. If any action at law or
in equity is necessary to enforce or interpret the terms of this Agreement, the
prevailing party shall be entitled to reasonable attorney's fees, costs and
necessary disbursements in addition to any other relief to which he may be
entitled.
16. Entire Agreement; Survival. This Agreement contains the
entire agreement between the parties with respect to the transactions
contemplated herein and supersedes, effective as of the date hereof any prior
agreement or understanding between Employer and Employee with respect to
Employee's employment by Employer. The unenforceability of any provision of this
Agreement shall not effect the enforceability of any other provision. This
Agreement may not be amended except by an agreement in writing signed by the
Employee and the Employer, or any waiver, change, discharge or modification as
sought. Waiver of or failure to exercise any rights provided by this Agreement
and in any respect shall not be deemed a waiver of any further or future rights.
b. The provisions of Sections 4, 8, 9,
10(a)(ii), 10(c), 11, 12, 13, 14, 15, 18, 19 and 20 shall survive the
termination of this Agreement.
17. Assignment. This Agreement shall not be assigned to
other parties.
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18. Governing Law. This Agreement and all the amendments
hereof, and waivers and consents with respect thereto shall be governed by the
internal laws of the State of New York, without regard to the conflicts of laws
principles thereof.
19. Notices. All notices, responses, demands or other
communications under this Agreement shall be in writing and shall be deemed to
have been given when:
a. delivered by hand;
b. sent by telex or telefax, (with receipt
confirmed), provided that a copy is mailed by registered or certified mail,
return receipt requested; or
c. received by the addressee as sent be express
delivery service (receipt requested) in each case to the appropriate addresses,
telex numbers and telefax numbers as the party may designate to itself by notice
to the other parties:
(i) if to the Employer:
Amedore Homes, Inc.
0000 Xxxxxx Xxxx
Xxxxxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Xx.
Telefax: (000) 000-0000
Telephone:(000) 000-0000
Xxxxxxx, Xxxxxx & Xxxxxxxxx,LLP
000 Xxxx 00xx Xxxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxx X. Xxxxxxxxx, Esq.
Telefax: (000) 000-0000
Telephone: (000) 000-0000
(ii) if to the Employee:
Xxxxxx X. Xxxxxxx, Xx.
0000 Xxxxxx Xxxx
Xxxxxxxxxxx, XX 00000
20. Severability of Agreement. Should any part of this
Agreement for any reason be declared invalid by a court of competent
jurisdiction, such decision shall not affect the validity of any remaining
portion, which remaining provisions shall remain in full force and effect as if
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this Agreement had been executed with the invalid portion thereof eliminated,
and it is hereby declared the intention of the parties that they would have
executed the remaining portions of this Agreement without including any such
part, parts or portions which may, for any reason, be hereafter declared
invalid.
IN WITNESS WHEREOF, the undersigned have executed this
agreement as of the day and year first above written.
AMEDORE HOMES, INC.
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
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Xxxxxx X. Xxxxxxx, Xx.
Chief Executive Officer
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
--------------------------
Xxxxxx X. Xxxxxxx, Xx.
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SCHEDULE "A"
SECTION 4(A)(II) - PROJECTED GROSS REVENUE AND NET INCOME FOR ENTITLEMENT
OF BONUS
$25,000 bonus if Employer achieves gross revenues of $12,000,000 and $430,000 in
net income for fiscal year ended May 31, 2001
$50,000 bonus if Employer achieves gross revenues of $18,500,000 and $800,000 in
net income for fiscal year ended May 31, 2002
$75,000 bonus if Employer achieves gross revenues of $22,250,000 and $1,000,000
in net income for fiscal year ended May 31, 2003.
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