1
EXHIBIT 10.14
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is entered into as of
September 9, 1996 by and between Bikers Dream, Inc. (the "Company") and Xxxxxx
X. Xxxxx ( "Officer").
WITNESSETH:
WHEREAS, the Company and Officer desire to enter into this Agreement
to assure the Company and the Officer of the continuing service of Officer and
to set forth the terms and conditions of Officer's employment with the Company.
NOW, THEREFORE, in consideration of the mutual promises and covenants
set forth herein, the parties agree as follows:
1. Term. The Company agrees to employ Officer and Officer hereby
accepts such employment, in accordance with the terms of this Agreement,
commencing September 9, 1996 and ending September 8, 1998 unless this Agreement
is earlier terminated as provided herein.
2. Services and Exclusivity of Services. So long as this
Agreement shall continue in effect, Officer shall devote a reasonable amount of
his business time, energy and ability to the business, affairs and interests of
the Company and its affiliates or subsidiaries ("Affiliates") and matters
related thereto to promote the Company's interests, and shall perform the
services contemplated by this Agreement in accordance with policies established
by and under the direction of the Board of Directors of the Company. The
Company acknowledges that Officer has significant outside business interests
that impact his ability to devote his full business time to his duties
hereunder.
3. Duties and Responsibilities. Officer shall serve as Co-Chief
Executive Officer of the Company for the duration of this Agreement. Officer
duties and responsibilities shall be generally consistent with such title,
subject to limitations on his availability described in Section 2 hereof.
Officer shall report directly to the Board of Directors of the Company and
shall be subject to the direction of the Board of Directors and to such limits
on Officer's authority as the Board of Directors may from time to time impose.
4. Compensation
(a) No Compensation. During the term of this Agreement, the Company
will pay Officer no salary.
(b) No Benefits. Officer shall not be entitled to any rights and
benefits for which Officer is otherwise eligible under any bonus plan,
incentive, participation or extra compensation plan, pension plan,
profit-sharing plan, life, medical, dental, disability, or insurance plan or
policy or other
2
plan or benefit that the Company or its Affiliates may provide for employees
generally as from time to time in effect, except for any as may be specifically
approved by the Board of Directors from time to time.
(c) Perquisites. Officer shall be entitled to select one new or
used motorcycle from inventory each twelve-month period, title to which shall
then be conveyed to Officer.
(d) Options. Officer shall be granted options to purchase 200,000
shares of the Company's common stock at an exercise price of $1.05 per share,
such options to be exercisable for two years, with a cashless exercise
feature, and shall not be terminable notwithstanding any termination of this
Agreement for any reason. The shares underlying such options shall have
piggyback registration rights on the next registration statement to be filed by
the Company covering the registration of shares for resale.
5. Termination. This Agreement and all obligations hereunder,
except the obligations contained in Section 7, which shall survive any
termination hereunder, shall terminate upon the earliest to occur of any of the
following:
(a) Expiration of Term. The expiration of the term provided for
in Section 1 or the voluntary termination by Officer.
(b) Death or Disability of Officer. For the purposes of this
Agreement, disability shall mean the absence of Officer performing Officer's
duties with the Company for a period of 6 months, as a result of incapacity due
to mental or physical illness which is determined to be total and permanent by
a physician selected by the Company or its insurers and acceptable to Officer
or Officer's legal representative (such agreement as to acceptability not to be
withheld unreasonably). If Officer shall become disabled, Officer's employment
may be terminated by written notice from the Company to Officer.
(c) For Cause. The Company may terminate Officer's employment
hereunder for cause. For purposes of this Agreement, the term "cause" shall be
defined as any of the following:
(i) Officer's material breach of any of the duties and response
(other than as a result of incapacity due to Officer's disability), or breach
of Officer's fiduciary duty as those terms are defined by the California Labor
Code;
(ii) Officer's conviction by, or entry of a plea of guilty or nolo
contendere in, a court of competent jurisdiction for a felony;
(iii) Officer's commission of an act of fraud, as determined by a
court of competent jurisdiction after all appeals have been exhausted, upon the
Company.
2
3
(iv) Officer's willful failure or refusal to perform Officer's
duties or responsibilities under this Agreement or Officer's material violation
of any duty of loyalty to the Company or a breach of Officer's fiduciary duty
as those terms are defined by the California Labor Code.
Notwithstanding the foregoing, Officer shall not be terminated for cause
pursuant to clauses (i) through (iv) of this Section 5(c) unless and until
Officer has received notice of a proposed termination for cause and Officer has
had an opportunity to be heard before at least a majority of members of the
Board of Directors. Officer shall be deemed to have had such an opportunity if
given written or telephonic notice at least 72 hours in advance of a meeting.
(d) Without Cause. Notwithstanding any other provision of this
Section 5, the Board shall have the right to terminate Officer's employment
with the Company without cause at any time, provided that the Company shall
first permit the Officer to select one new or used motorcycle in addition to
the motorcycles provided for in Section 4(c) above.
6. Business Expenses. During the term of this Agreement, to the
extent that such expenditures satisfy the criteria under the Internal Revenue
Code for deductibility by the Company (whether or not fully deductible by the
Company) for federal income tax purposes as ordinary and necessary business
expenses, the Company shall reimburse Officer promptly for reasonable business
expenditures (including travel, entertainment, parking, business meetings, and
professional dues but not the costs of or dues associated with maintaining club
memberships) made and substantiated in accordance with policies, practices and
procedures established from time to time by the Company
7. Indemnity. To the fullest extent permitted by applicable law
and the bylaws of the Company, as from time to time in effect, the Company
shall indemnify Officer and hold Officer harmless for any acts or decisions
made in good faith while performing services for the Company, and the Company
shall use its best efforts to obtain coverage for Officer (provided the same
may be obtained at reasonable cost) under any liability insurance policy or
policies now in force or hereafter obtained during the term of this Agreement
that cover other officers of the Company having comparable or lesser status and
responsibility. To the same extent the Company will pay all expenses,
including reasonable attorneys' fees and costs of court approved settlements,
actually and necessarily incurred by Officer in connection with the defense of
any action, suit or proceeding and in connection with any appeal thereon, which
has been brought against Officer by reason of Officer's service as an officer
or agent of the Company or of any Affiliate of the Company. The parties
understand and agree that this does not reduce or modify any and all statutory
or common law duties to indemnify Officer in the course or scope of his
employment.
8. Severability. If any provision of this Agreement is held to
be unenforceable for any reason, it shall be adjusted rather than voided, if
possible, to achieve the intent of the parties to the extent possible. In any
event, all other provisions of this Agreement shall be deemed valid and
enforceable to the extent possible.
3
4
9. Succession, This Agreement shall inure to the benefit of and
be binding upon the Company and its successors and assigns and any such
successor or assignee shall be deemed substituted for the Company under the
terms of this Agreement for all purposes. As used herein, "successor" and
"assignee" shall include any person, firm, corporation or other business entity
which at any time, whether by purchase, merger or otherwise, directly or
indirectly acquires the stock of the Company or to which the Company assigns
this Agreement, by operation of law or otherwise. The obligations and duties
of Officer hereunder are personal and otherwise not assignable. Officer's
obligations and representations under this Agreement will survive the
termination of Officer's employment, regardless of the manner of such
termination.
10. Notices. Any notice or other communication provided for in
this Agreement shall be in writing and sent if to the Company to its principal
office at:
Bikers Dream, Inc.
0000 Xxxxxxx Xxx
Xxxxx Xxx, XX 00000
Attention: Controller
with a copy to: Rowland W. Day II
Day Xxxxxxxx & XxXxxx
0000 Xxxxxxx, Xxxxx 000
Xxxxx Xxxx, Xxxxxxxxxx 00000
with a copy to: Xxxxxx X. Xxxxx
Xxxxx, Xxxxx & Associates
000 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
or at such other address as the Company may from time to time in writing
designate, and if to Officer at such address as Officer may from time to time
in writing designate. Each such notice or other communication shall be
effective (i) if given by telecommunication, when transmitted to the applicable
number so specified in this Section 10 and a verification of receipt is
received, (ii) if given by mail, three days after such communication is
deposited in the mails with first class postage prepaid, addressed as aforesaid
or (iii) if given by any other means, when actually delivered at such address.
11. Entire Agreement. This Agreement contains the entire
agreement of the parties relating to the subject matter hereof and supersedes
any prior agreements, undertakings, commitments and practices relating to
Officer's employment by the Company, other than option or warrant agreements or
other agreements not inconsistent herewith.
12. Amendments. No amendment or modification of the terms of this
Agreement shall be valid unless made in writing and duly executed by both
parties.
4
5
13. Waiver, No failure on the part of any party to exercise or
delay in exercising any right hereunder shall be deemed a waiver thereof or of
any other right, nor shall any single or partial exercise preclude any further
or other exercise of such right or any other right.
14. Governing Law. This Agreement, and the legal relations
between the parties, shall be governed by and construed in accordance with the
laws of the State of California.
15. Attorneys' Fees. If any litigation shall occur between
Officer and the Company which litigation arises out of or as a result of this
Agreement or the acts of the parties hereto pursuant to this Agreement, or
which seeks an interpretation of this Agreement, each party in such litigation
shall bear its own expenses, including attorneys' fees and costs.
16. Withholdings. All compensation payable hereunder, including
salary and other benefits, shall be subject to applicable taxes, withholding
and other required, normal or elected employee deductions.
17. Counterparts. This Agreement and any amendment hereto may be
executed in one or more counterparts. All of such counterparts shall constitute
one and the same agreement and shall become effective when a copy signed by
each party has been delivered to the other party.
18. Headings. Section and other headings contained in this
Agreement are for convenience of reference only and shall not affect in any way
the meaning or interpretation of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
THE COMPANY
Bikers Dream, Inc.
/s/ ROWLAND W. DAY II
-----------------------------------
By: ROWLAND W. DAY II
Its Co-CEO
------------------------------
OFFICER
/s/ XXXXXX X. XXXXX
-----------------------------------
XXXXXX X. XXXXX
5