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Exhibit 10.6
EMPLOYMENT AGREEMENT
This Employment Agreement is made on the 1st day of January, 1999 between AmTec,
Inc., a Delaware Corporation ("Employer"), and Xxxxxx X. Xxxxxx, Xx.
("Executive").
1. TERM. Employer hereby employs Executive and Executive hereby accepts
employment on the terms and conditions hereinafter set forth. Subject to the
provisions of Section 7 hereof, the term of this Agreement shall be effective
commencing as of January 1, 1999 and shall terminate on December 31, 2001.
2. DUTIES. Executive agrees to serve Employer as Chairman, Chief
Executive Officer and President of AmTec, Inc. and in such capacity Executive
agrees to render his services to the best of his ability. Executive will report
to the Board of Directors of the Company. During the term of this Agreement,
Executive will devote his full time (at least 35 hours per week) and attention
to, and use his best efforts to advance the business and welfare of Employer,
subject to the directions and control of the Board of Directors.
3. CONFIDENTIAL INFORMATION AND COVENANT NOT TO COMPETE.
(a) Executive hereby agrees that, during the term of this
Agreement and thereafter, he will not disclose to any person, or otherwise use
or exploit any of the proprietary or confidential information or knowledge,
including without limitation, trade secrets, processes, records of research,
proposals, reports, methods, processes, techniques, computer software or
programming, or budgets or other financial information, regarding Employer, its
business, properties or affairs obtained by him at any time prior to or
subsequent to the execution of this Agreement, except in the furtherance of the
interests of Employer in the execution of Executive's duties hereunder or as may
be required pursuant to a lawful order of a judicial tribunal or legislative
body of competent jurisdiction.
(b) Upon termination of employment, Executive will deliver to
Employer all processes, records of research, proposals, reports, memoranda,
computer software and programming, budgets and other financial information, and
other materials or records or writings of any other type (including any copies
thereof) made used or obtained by Executive in connection with his employment by
Employer.
(c) During the term of this Agreement, Executive agrees that
he will: (i) neither authorize his name to be used by, (ii) nor engage in or
carry on, directly or indirectly, for himself as a member of a partnership or as
a stockholder (other than as a stockholder of less than five percent (5%) of the
issued and outstanding stock of a publicly held corporation having assets in
excess of $10,000,000), investor, officer, or director of a corporation (other
than Employer, or any parent, subsidiary, affiliate or successor of Employer),
or as an employee, agent, associate, or consultant of any person, partnership,
corporation or other business entity, in competition with any business carried
on, directly or indirectly, by Employer prior to the date hereof or hereafter
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conducted, directly or indirectly, by Employer during the term of this
Agreement, in any county where business is then carried on or conducted by
Employer.
(d) Executive agrees that the remedy at law for any branch by
him of any of the covenants and agreements set forth in this Section 3 will be
inadequate and that in the event of any such breach, Employer may, in addition
to the other remedies which may be available to it at law, obtain injunctive
relief prohibiting him (together with all those persons associated with him)
from the breach of such covenants and agreements.
(e) The parties hereto intend that the covenants and
agreements contained in this Section 3 shall be deemed to include a series of
separate covenants and agreements. If, in any judicial proceeding, a court shall
refuse to enforce all of the separate covenants deemed included in such action,
then such unenforceable covenants shall be deemed eliminated from the provisions
hereof for the purposes of such proceeding to the extent necessary to permit the
remaining separate covenants to be enforced in such proceeding.
4. COMPENSATION.
4.1 SALARY. For the services to be rendered by Executive
during the first year of the term of this Agreement, Employer shall pay
Executive an annual base salary of Four Hundred Fifty Thousand Dollars
($450,000), payable in cash in equal installments semi-monthly and subject to
income tax withholdings and other payroll deductions as customary in respect of
Employer's salaried employees in general. On the date of this agreement,
Executive shall receive ten year options to purchase 200,000 shares of common
stock of the Employer at a price of $1.00 per share, said options to vest 25% on
June 30, 1999, December 31, 1999, June 30, 2000 and December 31, 2000. While the
amount of additional option awards will be determined at the discretion of the
Compensation Committee of the Board of Directors. It is intended that Executive
will receive stock options in each year of this Agreement. The annual base
salary of Executive for the second and third years of the term of this Agreement
will be determined by the Compensation Committee of the Board of Directors.
4.2 BONUS. Executive shall be entitled to participate in such
bonus plans of Employer applicable to senior executives of Employer as
determined by the Board of Directors of Employer in its sole discretion,
however, it is the goal of Employer to pay a bonus in the first year of the
Agreement between $50,000 to $500,000. All bonuses payable to Executive per the
Agreement and will be payable on December 31 of 1999, 2000 and 2001. The
Compensation Committee may consider a bonus to be paid to Executive on March 31,
1999 for the fiscal year then ended. Criteria for the determination of the
discretionary amount of bonus will be as agreed upon by the Executive and the
Chairman of the Board within forty-five days of the date of this Agreement and
within forty-five days of the commencement of each succeeding year of employment
hereunder.
4.2(a) STOCK OPTIONS. The Executive shall receive
stock options as described in section 4.1. It is expected that the Executive
will receive additional option awards in the second and third years of the term
of this Agreement as determined by the Compensation Committee of the Board of
Directors.
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4.2(b) STOCK GRANTS. The Executive will be entitled
to receive a stock grant of 100,000 shares of the Employer's Common Stock upon
the commencement of this Agreement.
4.2(c) LONG TERM COMPENSATION PLAN. Executive shall
be entitled to participate in a long-term compensation plan which will be
multi-year performance based over a number of years starting with the first
contract year. It is the intention of the Employer to pay the Executive on the
incentive basis to be determined by the Compensation Committee of the Board of
Directors under a performance based plan after a number of years stipulated by
the Board of Directors.
4.3 VACATION. Executive shall be entitled to four weeks' paid
vacation for each year during the term of this Agreement.
4.4 MEDICAL INSURANCE. During the term of this Agreement
Employer shall furnish Executive with the same medical and hospital insurance
furnished to other employees of Employer.
4.5 DISABILITY INSURANCE. During the term of this Agreement,
Employer shall furnish Executive with Long Term Disability Insurance on the same
terms available to all senior executives of Employer.
4.6 PENSION AND PROFIT SHARING. Executive shall participate in
such pension and profit sharing plans as are established for senior executives
of Employer.
4.7 OTHER BENEFITS, RIGHTS AND OPTIONS. In addition to the
foregoing, Executive shall be entitled to such additional rights and options as
may be granted or established for the benefit of senior executive officers of
the Company, including, without limitation, in connection with, any
recapitalization, reorganization, consolidation or merger of the Company. Not
withstanding, Executive will be entitled to:
(a) The Company shall reimburse the Executive promptly for all
reasonable club membership dues incurred by him for membership in two clubs in
the New York City area;
(b) Executive shall be entitled to be paid an allowance of
$35,000 per year (subject to required withholding) for financial planning and
tax preparation expenses.
(c) The Company shall provide a car and a driver for the
Executive's use in New York City.
5. EXPENSES. Employer will pay or reimburse Executive for such
reasonable travel (including first class air travel), entertainment, or other
expenses as he may incur at the request of Employer during the term of this
agreement in connection with the performance of his duties hereunder. Executive
shall furnish Employer with such evidence that such expenses were incurred as
Employer may from time to time require or request.
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6. DEATH OR TOTAL DISABILITY OF EXECUTIVE. If Executive dies, or
becomes totally disabled (for a period of more than six (6) consecutive weeks),
during the term of this Agreement, Executive's employment under this Agreement
shall automatically terminate; provided that, in such event of death or total
disability, Executive's stock options under paragraph 4.1 hereof, to the extent
not already vested, shall vest immediately.
7. TERMINATION FOR CAUSE. Executive's employment under this Agreement
may be terminated by Employer for "good cause". The term "good cause" is defined
as any one or more of the following occurrences:
(a) Executive's breach of any of the covenants contained in
Section 3 of this Agreement;
(b) Executive's conviction by, or entry of a plea of guilty or
nolo contendere to a felony;
(c) Executive's commission of an act of fraud, whether prior
to or subsequent to the date hereof, upon Employer;
(d) Executive's continuing failure or refusal to perform his
duties as required by this Agreement;
(e) Executive's gross negligence, insubordination, material
violation of any duty or loyalty to Employer or any other material misconduct
relating to the business or good will of Employer;
8. MISCELLANEOUS.
8.1 MODIFICATION AND WAIVER OF BREACH. No waiver or
modification of this Agreement shall be binding unless it is in writing signed
by the parties hereto. No waiver of a breach hereof shall be deemed to
constitute a waiver of a future breach, whether of a similar or dissimilar
nature.
8.2 COMPLETE AGREEMENT. The Agreement contains the entire
agreement between the parties hereto with respect to the transactions
contemplated by this Agreement and supercedes all previous oral and written and
all contemporaneous negotiations, commitment, writings, and understandings and
is and shall be binding upon the inure to the benefit of Employer, its
successors and permitted assigns and Executive, his heirs, executors and
administrators.
8.3 LEGAL FEES. If any legal action, arbitration or other
proceeding is brought for the enforcement of this Agreement, or because of any
alleged dispute, breach, default or misrepresentation in connection with this
Agreement, the successful or prevailing party shall be entitled to recover
reasonable attorneys' fees and other costs it incurred in that action or
preceding, in addition to any other relief to which it may be entitled.
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8.4 ASSIGNMENT. This Agreement may not be assigned in any
manner whatsoever.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the day and year first above written.
EXECUTIVE: EMPLOYER:
AMTEC, INC.
/s/ Xxxxxx X. Xxxxxx, Xx. /s/ Xxxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxx, Xx. Xxxxxxx X. Xxxxxxxx
CHAIRMAN, COMPENSATION
COMMITTEE
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