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EXHIBIT 10.26
EMPLOYMENT AGREEMENT
THIS AGREEMENT, made as of the 1 day of April, 1999 by and between FATS,
Inc., an Atlanta based corporation (the "Company") and Xxxx X. Xxxxxxx (the
"Employee").
WHEREAS, the Company desires to employ Employee to devote full time
service to the business of the Company and Employee desires to be so employed.
NOW THEREFORE, IN CONSIDERATION Of the premises and the terms and
conditions hereinafter set forth, the parties hereto agree as follows:
1. Employment. Subject to the terms and conditions hereof, the company
shall employ Employee and Employee agrees to be so employed in the capacity of
Chief Financial Officer for a term commencing (date of signing), and ending on
September 30, 2000.
2. Duties. Employee shall diligently and conscientiously devote his
full and exclusive time and attention to the discharge of his duties as Chief
Financial Officer. In such capacity, Employee shall at all times discharge said
duties in consultation with and under the direct supervision of the Executive
Vice President of the Company, and indirectly to the President and Board of
Directors of the Company.
3. Compensation. Commencing at the effective date hereof and continuing
through and including September 30, 2000, the Company shall pay to Employee for
services rendered hereunder as base compensation of $4,038.47 per two week pay
period. Employee is also eligible for performance bonus awards and stock option
participation consistent with the Company's incentive program throughout the
course of this agreement. The Employee shall remain eligible for programs
offered by the Company such as expense reimbursement and health and dental
benefits during the performance of this agreement in accordance with standard
practices and procedures of the Company.
4. Termination. Employee's employment hereunder shall be terminated
upon the happening of any of the following events:
(a) Expiration of the term of this Agreement, without renewal;
(b) Death of the Employee;
(c) Notice to Employee that his employment is terminated due to
Employee's inability to perform his usual and customary duties by reason of
physical or mental disability;
(d) By Employee upon thirty (30) days prior written notice to the
Company;
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(e) By Employee, if, following a Change in Control of the Company as
defined below, Employee's duties are Substantially Reduced or Negatively
Altered, as defined below, without prior written consent, upon thirty (30) days
prior written notice to the Company; or
(f) At any time without notice by the Company for cause.
For purposes of this Section, "Cause" means (I) Employee's conviction of
a felony which constitutes a crime involving moral turpitude; (ii) Employee's
misappropriation of funds, fraud or embezzlement; or (iii) Employee's willful
or gross and repeated neglect of duties hereunder, or willful or gross repeated
misconduct in the performance of such duties, so as to have a material adverse
effect on the business, operations, assets, properties, or financial condition
of Company, taken as a whole, determined in good faith by the Executive Vice
President, approved by the President and ratified by the Company's board of
directors.
For purposes of this Section, "Physical or Mental Disability" means any
ailment or incapacity with prevents Employee from performing the duties
incident to the Employee's employment hereunder which has continued for a
period of either (i) 45 consecutive days during the period of agreement or is
reasonably expected to be permanent.
For purposes of this section, a "Change in Control" with respect to the
Company shall have occurred on the earliest of the following dates:
(i) The date after the date of this Agreement that any entity or person
(including a "group" as defined in Section 13(d)(3) of the Securities Exchange
Act of 1934 (the "Exchange Act")) shall have become the beneficial owner of, or
shall have obtained voting control over, fifty percent (50%) or more of the
outstanding common shares of the Company;
(ii) The date the shareholders of the Company approve a definitive
agreement: (A) to merge or consolidate the Company with or into another
corporation, or to merge another corporation into the Company, in which the
Company is not the continuing or surviving corporation or pursuant to which any
common shares of the Company would be converted into cash, securities of
another corporation, or other property, other than a merger or consolidation of
the Company in which holders of common shares of the Company immediately prior
to the merger have the same proportionate ownership of common stock of the
surviving corporation or its parent corporation immediately after the merger as
immediately before; or (B) to sell or otherwise dispose of substantially all
the assets of the Company; or
(iii) The date there shall have been a change in a majority of the Board
of Directors of the Company within a twelve (12) month period unless the
nomination for election by the Company's shareholders of each new director was
approved by the vote
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of two-thirds of the directors then still in office who were in office at the
beginning of the twelve (12) month period.
Notwithstanding the foregoing, a "Change in Control" with respect to the
Company shall not be deemed to have occurred by reason of a private placement
of securities of the Company that is authorized by the Board of Directors, or
by a change in the directors occurring as a result of the exercise of rights
conferred in any agreement between the Company and investors in any such
private placement of securities.
"Substantially Reduced or Negatively Altered" means, without Employee's express
written consent:
(i) the assignment to Employee of any duties inconsistent with
Employee's positions, duties, responsibilities and status with Company or
a change in Employee's reporting responsibilities, titles or offices, or
any removal of Employee from, or any failure to re-elect Employee to, any
of such positions, except in connection with the termination of
Employee's employment for cause, upon the physical or mental disability
or death of Employee, or upon the voluntary termination by Employee;
(ii) a reduction in Employee's Base Salary below the minimum Base
Salary in Section 3 hereof;
(iii) the failure by Company to continue in effect benefit plans
substantially equivalent to the benefit plans in effect at the effective
date of this Agreement or established during the term of this Agreement;
the taking of any action by Company not required by law which would
adversely affect Employee's participation in or materially reduce
Employee's benefits under any of such plans or deprive Employee of any
material fringe benefit enjoyed by Employee; or the failure by Company to
provide Employee with the number of paid vacation days, holidays and
personal days to which Employee was then entitled in accordance with
Company's normal leave police in effect at the effective date of this
Agreement; or
(iv) failure of any successor to the Company not otherwise bound
by this Agreement to expressly assume and agree to perform the
obligations of the Company under this Agreement.
5. Effect of Termination. If Employee is terminated by the Company for
cause as defined in Section 4(f) or Employee terminates employment under
Section 4(d), Employee shall be paid only to the date of actual termination of
employment and Employee shall not be entitled to any additional compensation
for the year in which termination of employment occurs or any other termination
payment.
If Employee terminates employment for the reason specified in Section
4(e) or Employee is terminated by the Company for any reason other than "for
cause", Employee
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shall be entitled to a salary and health benefits as cited in Section 3 shall
continue through the period of this agreement, September 30, 2000.
6. Confidentiality. "Confidential Information" means any information
or compilation of information possessed by the Company that derives independent
economic value, actual or potential, from not being generally known to, and not
being readily ascertainable by proper means by other persons who can obtain
economic value from its disclosure or use, including but not limited to: (a)
any information not generally known in the industry of the Company regarding
the Company's pricing of services, research, development, marketing, servicing,
business systems, and techniques; (b) financial information concerning the
Company; and (c) any information that the Company may from time to time
designate as "confidential," "proprietary," or "trade secrets" which is not
generally known in the industry of the Company.
The Employee may have access to Confidential Information which the
Company desires to protect at all times. The Employee understands,
acknowledges, and agrees that the Company has expended substantial sums of
money, time and effort in developing such Confidential Information and the
Company will be substantially harmed in the competitive marketplace if the
Confidential Information is used to its detriment or to the benefit of others.
In recognition of the foregoing, the Employee agrees that:
(a) The Employee will not, during or after employment with the Company,
directly or indirectly knowingly use or disclose any Confidential
Information to any other person, firm or company, or in any way use
for his benefit, or to the detriment of the Company, any
information or knowledge obtained during the course of his
employment with the Company, except as required in the conduct of
the Company's business or as authorized in writing by the Company;
and
(b) All memoranda, notes, records, papers and other documents and all
copies thereof relating to the Company's operations and all objects
related thereto are and remain the property of the Company;
including, but not limited to, those developed, investigated, or
considered by the Company. The Employee will not copy or duplicate
any of the aforementioned documents or objects nor use any
information contained therewith, except for the Company's benefit,
either during or after his employment.
7. Covenant Not To Compete. The parties agree that the Company would
be substantially harmed if the Employee competes with the Company during
employment with the Company or after termination of employment with the
Company. Therefore, in exchange for the benefits provided to the Employee
hereunder, the Employee agrees that during his employment with the Company and
for a period of one (1) year after
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termination of such employment for any reason, the Employee will not directly
or indirectly, without the written consent of the Company:
(01) Own, operate or render services to any entity engaged, directly or
indirectly, in owning or operating gunnery simulators and training
devices; or
(02) Hire, offer to hire, entice away, or in any other way, persuade or
attempt to persuade any entity or any employee, officer, agent,
independent contractor, supplier, customer, or subcontractor of the
Company to discontinue their relationship with the Company;
8. Disparagement. The Company and Employee agree that during and after
the term of this Agreement, they will not knowingly vilify, disparage, slander
or defame the other party or, in the case of the Company, its officers,
directors, employees, business or business practices.
9. Remedy. Employee and Company acknowledge that in the event of a
breach of this Agreement by either party, money damages would be inadequate and
the non-breaching party would have no adequate remedy at law. Accordingly, in
the event of any controversy concerning the rights or obligations under this
Agreement, such rights or obligations shall be enforceable in a court of equity
by a decree of specific performance. Such remedy, however, shall be cumulative
and nonexclusive and shall be in addition to any other remedy to which the
parties may be entitled to by law.
10. Notices. All notices required or permitted to be given under this
Agreement shall be given by certified mail, return receipt requested, to the
parties at the following addresses or to such other addresses as either may
designate in writing to the other party:
If to Company: FATS, Inc.
0000 XxXxxxxx Xxxxx Xxxx
Xxxxxxx, XX 00000
If to Employee: Xxxx X. Xxxxxxx
0000 Xxxxx Xx.
Xxxxxxxxxxxxx, XX 00000
11. Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of Georgia.
12. Entire Contract. This Agreement constitutes the entire understanding
and agreement between the Company and Employee with regard to the matters
stated herein. There are no other agreements, conditions or representations,
oral or written, express or implied, with regard to the employment of Employee
by the Company. This Agreement may be amended only in writing, signed by both
parties hereto.
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13. Binding Effect. This Agreement shall ensure to the benefit of and
be binding upon the Company, its successors and assigns, and shall ensure to
the benefit of and be binding upon the Employee, his heirs, distributees and
personal representatives. In the event of Employee's death, any amounts payable
hereunder shall be paid in accordance with the terms of this Agreement to
Employee's designee, or if there is no such designee, to Employee's estate.
IN WITNESS WHEREOF, the parties have executed this Agreement the day and
year first above written.
FATS, INC.
By: Xxxxx Xxxxxx
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Its: President
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Xxxx X. Xxxxxxx
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