EMPLOYMENT AGREEMENT
EFFECTIVE DATE: May 15, 1998
EMPLOYER: THE ORLANDO PREDATORS ENTERTAINMENT, INC.
a Florida corporation
EMPLOYEE: XXXXX XXXXXX
PURPOSE:
--------
Employer owns, manages and operates a professional arena football franchise
known as the Orlando Predators and located in Orlando, Florida (the "Business").
Employer desires to employ Employee as as a financing, investment and
acquisitions strategist and Employee desires to accept such employment, on the
terms, covenants and conditions set forth in this Employment Agreement (this
"Agreement").
AGREEMENTS:
-----------
For the reasons set forth above, and in consideration of the mutual
promises and agreements set forth in this Agreement, Employer and Employee agree
as follows:
1. Employment; Duties.
-------------------
1.1 Subject to and in accordance with this Agreement, Employer employs
Employee as a financing, investment and acquisitions strategist for Employer and
Employee accepts employment with Employer subject to the general supervision and
pursuant to the orders, advice and direction of Employer. In such capacity,
Employee shall be responsible for identifying acquisition, merger and expansion
opportunities and the financing structures to accomplish the same.
1.2 Employee shall use his best efforts but shall not be required to
devote his full time to the performance of all the duties that may be required
of and from him pursuant to the express and implicit terms of this Agreement.
Such duties shall be rendered in Orlando, Florida and at such other places as
Employer and Employee shall mutually agree upon.
1.3 Employee represents and warrants that there are no agreements or
arrangements, written or oral, in effect which would prevent Employee from
rendering services to Employer during the term of this Agreement.
1.4 Nothing herein contained shall be construed to create a
partnership or joint venture between Employer and Employee. Neither party hereto
shall be liable for the debts or obligations of the other unless expressly
assumed in writing and signed by the parties hereto.
2. Term. This Agreement shall become effective on the date first written
above and, unless terminated sooner pursuant to Section 5, continue through May
31, 1999.
3. Compensation and Other Benefits.
--------------------------------
3.1 Compensation. For services rendered to Employer hereunder, in
whatever capacity rendered, Employee shall have and receive, subject to
withholding and other applicable taxes, an annual salary during the Term of
$20,000, which salary will be payable monthly, in arrears in two equal monthly
installments.
3.2 Stock Options. Employer shall grant to Employee stock options to
purchase 115,000 shares of no par value, voting common stock of Employer, to be
issued pursuant to Employer's stock option plan and to be evidenced by the stock
option agreement in form and content required by Employer's stock option plan
and providing for an exercise price equal to the fair market value of the shares
on the date of grant (being May 15, 1998) and for the vesting of the right to
purchase the shares on May 15, 1999.
3.3 Business Expenses. Upon submission of proper documentation,
Employer shall pay or reimburse Employee for all reasonable and necessary
office, telephone, travel and other expenses incurred by him in the pursuit of
his duties on behalf of Employer.
3.4 Employee Benefits. Employee shall be entitled to participate in
any and all other bonus, stock option, incentive compensation, deferred
compensation, group medical and dental insurance plans or other plans or
programs and to receive any and all other benefits for which he is eligible and
which Employer may provide its employees generally or its officers specifically.
4. Facilities. Employer shall provide and maintain (or cause to be provided
and maintained) such facilities, equipment, offices, secretarial help, and other
services and supplies as it deems necessary for Employee's performance of his
duties under this Agreement, as established from time to time by Employer.
5. Termination.
------------
5.1 This Agreement and Employee's employment hereunder may be
terminated at any time:
(a) By Employee upon the material breach by Employer of any of the
material provisions of this Agreement.
(b) By Employer for Cause. For purposes of this Agreement, the term
"Cause" shall mean: (i) conduct on the part of Employee which is intended to
result directly or indirectly in substantial gain or personal enrichment at the
expense of Employer; (ii) the material breach by Employee of any of the
provisions of this Agreement; or (iii) the failure by Employee to substantially
perform his duties hereunder.
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Further, this Agreement and Employee's employment hereunder shall automatically
terminate upon the death or disability of Employee or the discontinuance of
Employer's Business. For purposes of this Agreement, Employee is disabled if
Employee is found to be unable to fully perform substantially all material
aspects of his duties as an employee of Employer on a regular and consistent
basis for a consecutive period of 180 calendar days or for shorter periods
aggregating 180 calendar days (including sick leave days), during any 12 month
period.
5.2 Notwithstanding the termination of this Agreement or of Employee's
employment hereunder, the parties hereto shall be required to carry out any
provision hereof which contemplate performance by them subsequent to such
termination, nor shall such termination affect any liability or obligation which
has accrued prior to such termination, including but not limited to, accrued but
unpaid compensation and any liability for loss or damage on account of default.
5.3 Following any termination of employment hereunder, or notice
thereof, Employee shall fully cooperate with Employer in all matters relating to
the winding up of his pending work on behalf of Employer and the orderly
transfer of any such pending work to other employees of Employer as may be
designated by Employer. In consideration thereof, Employer shall pay Employee
for any services rendered post-termination at a rate equivalent to the daily
rate payable to Employee during the Initial Term or the Extension Term, as
applicable, during which the termination occurred.
5.4 Upon termination of this Agreement, or whenever requested by
Employer, Employee shall immediately turn over to Employer all of Employer's
property, including all items used by Employee in rendering services hereunder,
that may be in Employee's possession or under his control.
6. Covenant Not to Compete; Disclosure of Information.
---------------------------------------------------
6.1 Solicitation.
6.1.1 In the event that Employee terminates this Agreement in
breach of the terms and provisions hereof, then for a period of six months after
the date of such termination in breach of this Agreement, Employee shall not,
whether alone or as a partner, officer, director, employee or shareholder (or
other holder of an equity interest) of, or consultant, advisor or lender to, any
other corporation, partnership or other entity, or as a trustee, fiduciary or
other representative, solicit Employer's customers with respect to, engage in or
have any interest, including as a creditor, in any person, partnership,
corporation, association, or other business entity, whether as employee,
officer, director, agent, consultant, stockholder or holder of any right to any
form of equity ownership, or otherwise, that engages in the business of owing,
operating or managing professional football teams or leagues.
6.1.2 Employee shall not, during or for a period of six (6)
months after the term of this Agreement, solicit any employee, sales
representative or independent contractor of Employer for employment by any
person, firm, partnership, corporation, association or other entity for any
reason or purpose allied or related to the Business whatsoever.
-3-
6.2 Non Disclosure.
---------------
6.2.1 Employee hereby recognizes and acknowledges that: (i)
Employee will be making use of, acquiring, and/or adding to proprietary
information of a special and unique nature and value relating to and including,
but not limited to, such matters Employer's trade secrets, systems, procedures,
manuals, confidential reports, lists of suppliers, research and development
projects, policies, processes, formulas, techniques, know-how and facts relating
to sales, advertising, mailing, promotions, financial matters, customers,
customer lists, purchases or requirements or other methods used and preferred by
Employer in its operations, (ii) Employer will disclose certain proprietary
information to Employee including, but not limited to, the details of any
statistical or financial data, the operations and structure of the business of
Employer, and manuals, forms, techniques, methods or procedures of Employer used
by or made available to Employee in the course of Employee's employment (the
information referenced to in paragraphs 6.2.1 (i) and (ii) above are hereinafter
collectively referred to as the "Proprietary Information").
6.2.2 Employee hereby recognizes and acknowledges that the
Proprietary Information is a valuable, special and unique asset of Employer's
business.
6.2.3 Employee will not at any time, directly or indirectly make
use of, divulge or disclose any of the Proprietary Information or any part
thereof for any purpose whatsoever (except in the ordinary, day to day course of
conduct of Employer's Business) whatsoever to any person, firm, corporation,
association or other entity for any reason or purpose whatsoever (except in the
ordinary, day to day course of conduct of Employer's Business) that has been
obtained by, or disclosed to, him as a result of his relationship with Employer.
Immediately upon request by Employer, Employee shall return to Employer any and
all materials relating to Proprietary Information.
6.3 Acknowledgment.
---------------
6.3.1 Employee acknowledges that the covenants contained in this
Section 6 are a material inducement for Employer to enter into this Agreement
and to perform its obligations hereunder and that the services Employee is to
render to Employer hereunder are of a special and unusual character with a
unique value to Employer. Employee acknowledges that it would take at least six
(6) months for Employer to retain and train personnel to replace Employee.
Accordingly, Employee acknowledges that the restrictions contained in this
Section 6 are reasonably necessary for the protection of Employer's business and
that a breach of any such restrictions could not adequately be compensated by
damages in an action at law.
6.3.2 In the event of a breach or threatened breach by Employee
of any provision contained in this Section 6, Employer shall be entitled to
obtain, by posting an appropriate bond, an injunction (preliminary or permanent,
or a temporary restraining order) restraining Employee from the activity or
threatened activity constituting or that would constitute a breach.
-4-
6.3.3 In the event of a material breach by Employee of any
provision contained under this Section 6, Employer shall be entitled to an
accounting and repayment of all profits, compensation, commissions,
remunerations or other benefits that Employee, directly or indirectly, has
realized and/or may realize as a direct result of, arising directly out of or in
direct connection of any such breach.
6.3.4 The remedies provided in this Section 6 shall be in
addition to, and not in lieu of, any and all other remedies of Employer at law
or in equity.
7. Miscellaneous.
--------------
7.1 Notice. Notices required or permitted to be given hereunder shall
be sufficient if in writing and delivered or deposited in the mail, postage
prepaid, certified mail, return receipt requested (or the equivalent in a
foreign country), addressed, if to Employer, at its principal place of business
and, if to Employee, at the address set forth in Employer's employee records or
to such other address as may be designated in writing hereafter by either party
hereto. All notices hereunder shall be effective: (a) five (5) days after
deposit in the mail; or (b) upon delivery, if delivered in person or by
commercial express service.
7.2 Burden. Except as otherwise provided herein, this Agreement shall
be binding upon and inure to the benefit of any successor of Employer and any
such successor shall be deemed substituted for Employer under the terms of this
Agreement. As used in this Agreement, the term "successor" shall mean any
person, firm, corporation or other business entity which at any time, whether by
merger, purchase or otherwise acquires all or substantially all of the assets or
business of Employer.
7.3 Entire Agreement. This Agreement contains the entire agreement and
understanding by and between Employer and Employee with respect to the
employment of Employee and no representations, promises, agreements or
understandings, written or oral, not contained herein shall be of any force or
effect. No change or modification of this Agreement shall be valid or binding
unless it is in writing and signed by the parties intended to be bound. No
waiver of any provision of this Agreement shall be valid unless it is in writing
and signed by the parties against whom the waiver is sought to be enforced. No
valid waiver of any provision of this Agreement at any time shall be deemed a
waiver of any other provision of this Agreement at such time or any other time.
7.4 Arbitration. In the event any dispute or controversy arising out
of this Agreement cannot be settled by Employer and Employee, such controversy
or dispute, at the election of either Employer or Employee, by written notice to
the other, may be submitted to arbitration in Orlando, Florida and for this
purpose Employer and Employee each hereby expressly consent to such arbitration
and such place. In the event Employer and Employee cannot, within 15 days
following the election to submit the dispute or controversy to arbitration,
-5-
mutually agree upon an arbitrator to settle their dispute or controversy, then
Employer and Employee shall each select one arbitrator and the two arbitrators
shall select a third arbitrator. The decision of the majority of said
arbitrators shall be binding upon Employer and Employee for all purposes, and
judgment to enforce any such binding decision may be entered in the Circuit
Court, Orange County, Florida (and for this purpose Employer and Employee hereby
irrevocably consent to the jurisdiction of said court). If either Employer or
Employee fails to select an arbitrator within fifteen (15) days after written
demand from the other party to do so, then the Chief Judge in the United States
Middle District Court of the District of Florida shall select such other
arbitrator. At the election of either Employer or Employee, all arbitrators
shall be selected pursuant to the then existing rules and regulations of the
American Arbitration Association governing commercial transactions. At the
request of either Employer or Employee, arbitration proceedings shall be
conducted in the utmost secrecy. In such case, all documents, testimony and
records shall be available for inspection only for purposes of the arbitration
and only by either party and their respective attorneys and experts who shall
agree, in advance and in writing, to receive all such information in secrecy. In
all other respects, the arbitrators shall conduct all proceedings pursuant to
the Uniform Arbitration Act as adopted by the State of Florida and the then
existing rules and regulations of the American Arbitration Association governing
commercial transactions. The costs of the arbitration, the arbitrators and the
prevailing party's reasonable attorneys' fees shall be borne by the
non-prevailing party, as determined by the arbitrators.
7.5 Prohibition Against Assignment. This Agreement is personal to
Employee and Employee shall not assign or delegate any of his rights or
obligations hereunder without first obtaining the written consent of Employer.
7.6 Governing Law. This Agreement shall be governed in all respects
whether as to validity, construction, capacity, performance or otherwise by the
laws of the State of Florida. The section headings used in this Agreement are
included solely for convenience and shall not affect or be used in connection
with the interpretation of this Agreement.
7.7 Severability. The provisions of this Agreement shall be deemed
severable and the invalidity or unenforceability of any one or more of the
provisions of this Agreement shall not affect the validity and enforceability of
the other provisions.
7.8 AFL League. Employee agrees to be bound by the Arena Football
League, Inc. Bylaws, Operations Manual, Rule Book and/or by any other rules and
regulations of the Arena Football League, Inc. as they exist and/or as they may
be amended, modified or otherwise changed from time-to-time.
-6-
IN WITNESS WHEREOF, the parties have executed this document to be effective
the date first above written.
EMPLOYEE: EMPLOYER:
THE ORLANDO PREDATORS ENTERTAINMENT, INC.
a Florida corporation
/s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxxx X. Xxxxx
--------------------------------- -------------------------------------
XXXXX XXXXXX
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FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
EFFECTIVE DATE: January 26, 1999
EMPLOYER: THE ORLANDO PREDATORS ENTERTAINMENT, INC.
a Florida corporation
EMPLOYEE: XXXXX XXXXXX
PURPOSE:
--------
Employer and Employee entered into that certain Employment Agreement dated
May 15, 1998 (the "Agreement"). For good and valuable consideration, Employer
and Employee desire to amend the Agreement as set forth in this First Amendment
to Employment Agreement (this "Amendment").
AGREEMENT:
----------
All capitalized terms not defined herein shall have the meaning set forth
in the Agreement. Notwithstanding any provision to the contrary contained in the
Agreement, Employer and Employee hereby agree as follows:
1. Purpose. Employee desires to resign as a financing, investment and
acquisitions strategist and to hereafter act as Chief Executive Officer Employer
desires to employ Employee as Employer's Chief Executive Officer.
2. Section 1 - Employment; Duties.
----------------------------------
2.1 Subject to and in accordance with the Agreement, as amended by
this Amendment, Employer employs Employee as the Chief Executive Officer and
Employee accepts employment with Employer subject to the general supervision and
pursuant to the orders, advice and direction of Employer. In such capacity,
Employee shall be responsible for the overall and day-to-day operations of the
Business.
2.2 Employee shall use his best efforts and devote his full time to
the performance of all the duties that may be required of and from him pursuant
to the express and implicit terms of this Agreement. Such duties shall be
rendered in Orlando, Florida and at such other places as Employer and Employee
shall mutually agree upon.
3. Section 2 - Term. The term of the Agreement shall commence on the
Effective Date and, unless terminated sooner pursuant to Section 5 of the
Agreement, shall expire on December 31, 2001.
4. Section 3 - Compensation and Other Benefits.
4.1 From and after the Effective Date of this First Amendment: (i) the
compensation provided for in Section 3.1 of the Agreement is null and void; and
(ii) for services rendered to Employer hereunder, in whatever capacity rendered,
Employee shall have and receive, subject to withholding and other applicable
taxes, an annual salary of $50,000, payable monthly, in arrears in two equal
monthly installments during Employer's regular pay periods.
4.2 The 47,920 of the stock options granted pursuant to Section 3.2 of
the Agreement are hereinafter canceled. Employer shall issue to Employee an
option to purchase 950,000 shares of Class A voting common stock of Employer on
the terms and conditions set forth on the attached Exhibit "A".
6. Affect of Amendment. Except as amended by this Amendment, the Agreement
shall remain in full force and effect.
7. Counterpart. This Amendment may be executed in any number of
counterparts and each such executed counterpart shall constitute one and the
same instrument. Buyer and Seller agree that signatures received via facsimile
transmission shall in all respects be deemed to be original signatures.
EMPLOYEE: EMPLOYER:
THE ORLANDO PREDATORS ENTERTAINMENT, INC.,
a Florida corporation
/s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxxx X. Xxxxx
------------------------------- -------------------------------------
XXXXX XXXXXX Xxxxxxx Xxxxx, Chairman of the Board
2
Exhibit "A"
Form of Stock Option
3
STOCK OPTION AGREEMENT
EFFECTIVE DATE: January 26, 1999
OPTIONOR: THE ORLANDO PREDATORS ENTERTAINMENT, INC.
a Florida corporation
00 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
OPTIONEE: XXXXX XXXXXX
0000 Xxxx Xxx Xxxxxx Xxxxxx
Xxxxxxxx Xxxxxx, Xxxxxxx 00000
RECITALS:
---------
A. Optionee is the Chief Executive Officier of Optionor.
B. Optionor desires to grant to Optionee an option (the "Option") to
purchase nine hundred fifty thousand (950,000) shares (the "Option Shares") of
no par value, Class A voting common stock of Optionor ("Common Stock") on the
terms and conditions set forth in this Stock Option Agreement (this
"Agreement").
AGREEMENT:
----------
For good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Optionor and Optionee hereby agree as follows:
1. Grant of Option. Optionor hereby grants to Optionee a stock option to
purchase a total of nine hundred fifty thousand (950,000) Option Shares, subject
to the terms and conditions of this Agreement. The Option to puchase the Option
Shares shall vest one-third on January 26, 2000, one-third on January 26, 2001
and one-third on December 31, 2001.
2. Exercise Price. The price payable by Optionee upon exercise of the
Option (the "Exercise Price") shall be an amount equal to $4.44 per Option Share
(representing the fair market value of the Option Share on the Effective Date)
as determined by Optionor's certified public accountants).
3. Exercise of Option. Optionee shall have the right to exercise that
portion of the Option which has vested subject to the following terms and
conditions:
(a) Exercise. That portion of the Option which has vested may be
exercised at any time following the vesting date and until December 31, 2001
(the "Option Period"). If the period during which Optionee may exercise the
Option has ended, and the Option has not been exercised, the Option will lapse
and any subsequent attempt to exercise the Option will be of no effect.
(b) Manner of Exercise. The Option shall be exercisable only by
Optionee giving written notice to the Optionor of its intention to exercise from
that portion of the Option which has vsted, which notice shall state the number
of vested Option Shares to which the Option is being exercised. Each exercise
shall be for no less than 100,000 or if there are less than 100,000 vested
Option Shares outstanding under this Option, then the remaining number of vested
Option Shares available under the Option.
(c) The Closing. The consummation of a purchase of Option Shares
pursuant to an exercise of the Option shall take place at the main corporate
offices of the Optionor on such date as the parties shall agree upon, but in no
event later than ten (10) business days after receipt by Optionor of the notice
referred to in Section 3(b) above. At the closing, Optionee shall deliver to
Optionor (i) cash or a cashier's check for the Exercise Price, and (ii) the
investment letter referred to in Section 4 below. None of the Option Shares will
be issued to Optionee until Optionor has received the Exercise Price therefor.
In exchange therefor, Optionor shall issue simultaneously to Optionee a stock
certificate representing the Option Shares. Optionor shall reflect the issuance
of such Option Shares on its books and records.
4. Adjustment to Stock Option Shares. Except as otherwise herein expressly
provided:
(a) Stock Dividend. In case Optionor shall hereafter declare and pay
to the holders of shares of Common Stock a dividend in shares of Common Stock of
Optionor, or declare a stock split, Optionee shall, upon exercise of this
Option, be entitled to receive (in addition to the shares of Common Stock
purchased upon such exercise and without any payment other than the aggregate
Exercise Price for such shares assuming that no such stock dividend or stock
split had been declared) such additional shares of Common Stock as Optionee
would have received as a dividend or in a stock split if they had exercised this
Option immediately prior to the date such dividend or stock split was declared.
(b) Reorganization. In case of any reorganization or recapitalization
of Optionor (by reclassification of its outstanding shares of Common Stock or
otherwise), or its consolidation or merger with or into another corporation,
Optionee shall, upon exercise of the Stock Option, be entitled to receive, in
lieu of the shares of Common Stock which the Optionee would otherwise be
entitled to receive upon such exercise and without any payment in addition to
the aggregate Exercise Price for such shares assuming that no event specified
above had occurred, the shares of stock, cash or other consideration which the
Optionee would have received upon such reorganization, recapitalization,
consolidation or merger if immediately prior thereto the Optionee had exercised
this Option and had exchanged such shares of Common Stock in accordance with the
terms of such reorganization, recapitalization, consolidation or merger.
5. Investment Representation. Optionee acknowledges that neither the Option
nor the Option Shares to be delivered upon exercise of the Option (collectively,
the "Securities") have been registered under the Securities Act of 1933, as
amended, or applicable state securities laws. Optionee represents that the
Option is being, and the Securities will be, acquired and/or purchased for
investment and not with a view to their distribution or resale. Optionee shall
execute and deliver to Optionor on the Effective Date (in the form attached
hereto as Exhibit "A") and on each the closing date following any exercise
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hereunder (in the form attached hereto as Exhibit "B") an investment letter.
Each stock certificate evidencing any of Option Shares shall, if and when
delivered to Optionee, bear on its face a restrictive legend substantially in
the following form:
"These securities have not been registered under the
Securities Act of 1933, as amended. They may not be sold or
otherwise disposed of in the absence of an effective
registration statement under that Act or an opinion of
counsel satisfactory to the Company that such registration
is not required."
6. Optionee's Covenant. Optionee covenants and agrees that it will not,
without first obtaining Optionor's written consent, sell, assign, transfer,
pledge, hypothecate, encumber, alienate or otherwise dispose of the Option.
7. Notices. All communications or notices required or permitted to be given
or served under this Agreement shall be in writing and shall be deemed to have
been duly given or made if delivered in person or deposited in the United States
mail, postage prepaid, for mailing by certified or registered mail, return
receipt requested, and addressed to the addresses set forth above. Any party may
change its address by giving notice in writing, stating its new address, to all
of the other parties hereto as provided in the foregoing manner. Commencing on
the tenth day after the giving of such notice, such newly designated address
shall be such party's address for the purpose of all communications or notices
required or permitted to be given or served under this Agreement.
8. Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors, legal
representatives, executors and heirs; provided, however, that no party hereto
shall have the right to assign any right hereunder or delegate any obligation
hereunder, in whole or in part, without the prior written consent of the other
party hereto, and any attempt to do so shall be void.
9. Amendment, Modification or Waiver. No amendment, modification or waiver
of any condition, provision or term of this Agreement shall be valid or of any
effect unless made in writing, signed by the party to be bound and specifying
with particularity the nature and extent of such amendment, modification or
waiver.
10. Entire Agreement. This Agreement contains the entire understanding and
agreement of the parties hereto with respect to the subject matter hereof and
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.
11. Florida Law to Govern. This Agreement shall be governed by, and
construed and enforced in accordance with, the law of the State of Florida.
12. Attorney's Fees. In the event any party hereto brings any action to
enforce any provision hereof, or to secure specific performance hereof or to
collect any damages of any kind for any breach of this Agreement, the prevailing
party shall be entitled to all court costs, all expenses arising out of or
incurred by reason of litigation and any reasonable attorney's fees expended or
incurred for any such proceedings.
-3-
13. Severability. Each provision of this Agreement is intended to be
severable, and the invalidity or unenforceability of one or more provisions of
this agreement shall not affect the validity and enforceability of the other
provision. Should any valid federal or Florida state law or final determination
of any administrative agency or court of competent jurisdiction affect any
provision of this agreement, the provision or provisions so affected shall be
automatically conformed to the law or determination and otherwise this agreement
shall continue in full force and effect.
14. Counterparts. This agreement may be executed in two (2) or more
counterparts, each of which shall be considered one in the same agreement and
shall become effective when one or more counterparts have been found by each of
the parties hereto and delivered to the other parties hereto.
15. Withholding. Optionee authorizes Optionor to withhold in accordance
with applicable law from any regular cash compensation payable to it any taxes
required to be withheld by Optionor under federal, state or local law as a
result of its exercise of the Option.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
Effective Date.
OPTIONOR:
THE ORLANDO PREDATORS ENTERTAINMENT, INC.,
a Florida corporation
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------------------
Name: Xxxxxxx X. Xxxxx
------------------------------------------
Title: Chairman of the Board
-----------------------------------------
OPTIONEE:
/s/ Xxxxx X. Xxxxxx
------------------------------------------------
Xxxxx Xxxxxx
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EXHIBIT "A"
-----------
INVESTMENT LETTER
-----------------
TO: THE ORLANDO PREDATORS ENTERTAINMENT, INC.
In connection with the undersigned's acquisition of an Option to purchase
Option Shares, as those terms are defined in the Stock Option Agreement by and
between The Orlando Predators Entertainment, Inc. (the "Company") and the
undersigned, the undersigned acknowledges, represents, warrants, covenants and
agrees as follows:
1. The undersigned represents that:
(a) It is acquiring the Option, and will acquire the Option Shares for its
own account, for investment and not with a view to, or for resale in connection
with, the distribution thereof and that it has no present intention of
distributing the Option or the Option Shares (collectively, the "Securities");
(b) It possesses such knowledge and experience in financial and business
matters pertaining to the type of business conducted by the Company and
otherwise, that it is capable of evaluating the merits and risks of an
investment in the Securities;
(c) It is fully familiar with the Company and its business, operations,
condition (financial and other), assets, liabilities and prospects and has had
access to any and all material information it deems necessary or appropriate to
enable it to make an investment decision in connection with the acquisition of
the Securities; and
(d) Its financial situation is such that it can afford to bear the economic
risk of holding the Securities for an indefinite period of time and can afford
to suffer a complete loss of its investment in the Securities.
2. The undersigned understands and acknowledges that:
(a) Neither the Option nor the Option Shares have been registered pursuant
to the Securities Act of 1933, as amended (the "Act"), or any state securities
laws, that it may not transfer, resell or otherwise dispose of the Securities
except pursuant to a registration statement in compliance with the Act and any
applicable state securities laws, unless exemptions from the registration
requirements of the Act and any applicable state securities laws are available
that it must, therefore, bear the economic risks of an investment in the
Securities for an indefinite period of time;
(b) The Company is under no obligation to register the Securities pursuant
to the Act or any state securities laws or to comply with or make available any
exemption from the registration requirements thereof;
-5-
(c) Any certificates representing the Securities will contain a legend to
the effect that the Securities cannot be transferred, resold or otherwise
disposed of except in compliance with the Act and any applicable state
securities laws;
(d) A "stop-transfer" order will be issued with respect to the Securities
to effectuate the foregoing restrictions on transfer of the Securities and the
Company and its transfer agents shall have no obligation to effect any purported
transfer of the Securities except upon demonstration of compliance with the
foregoing restrictions; and
(e) It has had the opportunity to ask questions of the Company and its
representatives and receive answers from the Company and its representatives
concerning the Company and the undersigned's investment in the Securities and to
obtain additional information possessed by the Company, or obtainable without
unreasonable effort or expense, that is necessary to verify the accuracy of the
information furnished to the undersigned.
3. The undersigned covenants and agrees that it will not sell, pledge, transfer
or otherwise dispose of the Securities or any interest therein, or make any
offer to attempt to do any of the foregoing, except pursuant to a registration
statement in compliance with the Act and all applicable state securities laws or
in a transaction which, in the opinion of counsel for the Company, is exempt
from the registration requirements thereof.
The undersigned understands and acknowledges that the Company will rely
upon the acknowledgments, representations, warranties, covenants and agreements
contained herein (and any supplemental information provided to the Company) for
the purpose of determining whether this transaction meets the requirements for
an exemption from the registration requirements of the Act and applicable state
securities laws. The undersigned hereby agrees to indemnify and hold harmless
the Company and its directors and officers from and against any cost, expense,
claim, liability or damage arising out of or resulting from any breach of such
covenant and agreement including, without limitation, any liability of the
Company to any third person purchasing the Option or any capital stock of the
Company. Further the undersigned covenants and agrees that if there should be
any material change with respect to any of the representations and warranties
contained herein, after the execution of this Investment Letter and prior to the
exercise of the Option or the transfer of Securities to it, the undersigned will
immediately furnish the revised or corrected information to the Company.
EXECUTED this 26th day of January, 1999
/s/ Xxxxx X. Xxxxxx
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Xxxxx Xxxxxx
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EXHIBIT "B"
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INVESTMENT LETTER
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TO: THE ORLANDO PREDATORS ENTERTAINMENT, INC.
In connection with the undersigned's acquisition of Option Shares pursuant
to an exercise of the Option, as those terms are defined in the Stock Option
Agreement by and between The Orlando Predators Entertainment, Inc. (the
"Company") and the undersigned, the undersigned acknowledges, represents,
warrants, covenants and agrees as follows:
1. The undersigned represents that:
(a) It is purchasing the Option Shares for its own account, for investment
and not with a view to, or for resale in connection with, the distribution
thereof and that it has no present intention of distributing any of the Option
Shares;
(b) It possesses such knowledge and experience in financial and business
matters pertaining to the type of business conducted by the Company and
otherwise, that it is capable of evaluating the merits and risks of an
investment in the Option Shares;
(c) It is fully familiar with the Company and its business, operations,
condition (financial and other), assets, liabilities and prospects and has had
access to any and all material information it deems necessary or appropriate to
enable it to make an investment decision in connection with the purchase of the
Option Shares; and
(d) Its financial situation is such that it can afford to bear the economic
risk of holding the Option Shares for an indefinite period of time and can
afford to suffer a complete loss of its investment in the Option Shares.
2. The undersigned understands and acknowledges that:
(a) The Option Shares have not been registered pursuant to the Securities
Act of 1933, as amended (the "Act"), or any state securities laws, that it may
not transfer, resell or otherwise dispose of the Option Shares except pursuant
to a registration statement in compliance with the Act and any applicable state
securities laws, unless exemptions from the registration requirements of the Act
and any applicable state securities laws are available that it must, therefore,
bear the economic risks of an investment in the Option Shares for an indefinite
period of time;
(b) The Company is under no obligation to register the Option Shares
pursuant to the Act or any state securities laws or to comply with or make
available any exemption from the registration requirements thereof;
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(c) The certificates representing the Option Shares will contain a legend
to the effect that the Option Shares cannot be transferred, resold or otherwise
disposed of except in compliance with the Act and any applicable state
securities laws; and
(d) A "stop-transfer" order will be issued with respect to the Option
Shares to effectuate the foregoing restrictions on transfer of the Option Shares
and the Company, or its transfer agent, shall have no obligation to effect any
purported transfer of the Option Shares except upon demonstration of compliance
with the foregoing restrictions.
(e) It has had the opportunity to ask questions of the Company and its
representatives and receive answers from the Company and its representatives
concerning the Company and its investment in the Option Shares and to obtain
additional information possessed by the Company, or obtainable without
unreasonable effort or expense, that is necessary to verify the accuracy of the
information furnished to the undersigned.
3. The undersigned covenants and agrees that it will not sell, pledge, transfer
or otherwise dispose of the Option Shares or any interest therein, or make any
offer to attempt to do any of the foregoing, except pursuant to a registration
statement in compliance with the Act and all applicable state securities laws or
in a transaction which, in the opinion of counsel for the Company, is exempt
from the registration requirements thereof.
The undersigned understands and acknowledges that the Company will rely
upon the acknowledgments, representations, warranties, covenants and agreements
contained herein (and any supplemental information provided to the Company) for
the purpose of determining whether this transaction meets the requirements for
an exemption from the registration requirements of the Act and applicable state
securities laws. The undersigned hereby agrees to indemnify and hold harmless
the Company and its directors and officers from and against any cost, expense,
claim, liability or damage arising out of or resulting from any breach of such
covenant and agreement including, without limitation, any liability of the
Company to any third person purchasing any capital stock of the Company. Further
the undersigned covenants and agrees that if there should be any material change
with respect to any of the representations and warranties contained herein,
after the execution of this Investment Letter and prior to the transfer of
Option Shares to it, the undersigned will immediately furnish the revised or
corrected information to the Company.
EXECUTED this 26th day of January, 1999.
/s/ Xxxxx X. Xxxxxx
------------------------------------
Xxxxx Xxxxxx
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