EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT (this "Agreement") is made as of September
1, 2002, by and between Competency Based Learning Pty. Ltd. ACN 084 763
780, a registered company under the Corporations Xxx 0000 (Cwth.) (the
"Company"), and Xxxxx Xxxxxxx, an individual (the "Executive"). Certain
definitions are set forth in Section 5 of this Agreement.
In consideration of the mutual covenants contained herein and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties to this Agreement hereby agree as follows:
1. Employment.
(a) Position and Duties. The Company agrees to employ Executive and
Executive accepts such employment for the period beginning as of the date
hereof and ending upon termination pursuant to Section 1(c) hereof (the
"Employment Period"). Executive shall serve as Chief Executive Officer of
the Company and shall have all of the duties, powers and responsibilities
customarily delegated and assigned therewith, subject to the management and
control of the President of the Company or his designee and the Company's
Board of Directors (the "Board"). Executive shall not be required to
relocate without Executive's consent.
(b) Compensation.
(i) Salary. During the Employment Period, the Company will pay
Executive a base salary (the "Annual Base Salary") of USD $120,000 per
annum (payable monthly) or such other higher rate as the Board may
designate from time to time. The Board will review Executive's Annual Base
Salary at least once during each Fiscal Year, beginning with Fiscal Year
2002. Executive's Annual Base Salary for any partial Fiscal Year will be
prorated based upon the number of days elapsed in such Fiscal Year.
(ii) Bonus. Within the first 90 days of the date hereof, the
Board will determine a bonus plan for Executive, which shall be effective
for Fiscal Year 2002 and all subsequent Fiscal Years of the Company (and
portions thereof) during the Employment Period. The bonus plan shall take
into account the proposed budget for the applicable Fiscal Year and other
reasonable objectives determined by the Board. Upon completion of Fiscal
Year 2002 and each subsequent fiscal year of the Company, the Board will
award a bonus to Executive an amount to be determined in accordance with
the bonus plan criteria, as set forth on Exhibit A which shall give effect
to the Company's achievement of the budgetary and other reasonable
objectives identified in the bonus plan for the applicable Fiscal Year (the
"Annual Bonus").
(iii) Benefits. During the Employment Period, Executive will
be entitled to such automobile advances commensurate with advances received
by Executive in his prior employment with the Company. During the
Employment Period, Executive shall also be allowed to participate, on the
same basis and subject to the same conditions generally as other Executives
of Trinity Companies, Inc. ("Parent"), in all general employee benefit
plans and programs, including improvements or modifications of the same,
which are made available by Parent to all or substantially all of Parent's
employees. Such benefits, plans, and programs may include, without
limitation, sick leave, medical, health, and dental care, life insurance,
disability protection, and Section 401(k) plans. Except as expressly set
forth herein, nothing in this Agreement is to be construed or interpreted
to provide greater rights, participation, coverage, or benefits under such
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benefit plans or programs than provided to similarly-situated employees
pursuant to the terms and conditions of such benefit plans and programs.
Executive shall be entitled to four weeks of compensated vacation time
during each year of employment, which shall accrue on a pro rata basis from
the date employment commences under this Agreement. The carryover of
unused vacation time from year to year shall be in accordance with Company
policy. In addition, during the 2002 calendar year, Executive shall
receive options to purchase 250,000 shares of Parent's common stock
pursuant to Parent's stock option plan to be approved by Parent's board of
directors. Executive shall receive additional options to acquire a similar
number of shares of Parent common stock during each subsequent calendar
year of employment. Such options shall vest over a period of one year.
(c) Term and Termination. The Employment Period will commence on the
execution date hereof and continue thereafter for two (2) years (the
"Term") unless earlier terminated pursuant to the first to occur of (i)
Executive's resignation, death or Disability, or (ii) termination by the
Company with or without Cause.
(d) Severance.
(i) Termination Without Cause. If Executive's employment is
terminated by the Company without Cause or if Executive resigns for Good
Reason, then during the remainder of the Term commencing on the date of
termination, the Company shall pay Executive severance payments, at a rate
equal to Executive's Annual Base Salary, payable in equal installments on
the Company's regular salary payment dates (the "Severance Payments") and
allow Executive and Executive's qualified dependents to continue
participating in all of the Company's medical, disability and life
insurance plans on the same basis as Executive was participating prior to
termination (e.g., if Executive's participation was at the Company's sole
expense prior to termination, it will be at the Company's sole expense
during the severance period). In addition, at such time as the Annual
Bonus which would otherwise have been payable following the 12 month period
during which Executive was terminated, the Company shall pay Executive a
pro rata portion of the Annual Bonus based upon (i) the number of days of
Executive's employment during the period in which the Annual Bonus is
determined divided by (ii) 365 days.
(ii) Death or Disability. If Executive's employment is
terminated due to Executive's death or Disability, then during the sixth
month period commencing on the date of termination, the Company shall pay
Executive (or to Executive's spouse if so directed in writing by Executive
and in the absence of such direction to Executive's estate) at a rate equal
to Executive's Annual Base Salary, payable in equal installments on the
Company's regular salary payment dates (the "Severance Payments") and,
during the six month period commencing on the date of termination, allow
Executive and Executive's qualified dependents to continue participating in
all of the Company's medical, disability and life insurance plans on the
same basis as Executive was participating prior to termination. In
addition, at such time as the Annual Bonus which would otherwise have been
payable to Executive during the 12 month period immediately following the
date of termination would have been paid, the Company shall pay Executive a
pro rata portion of the Annual Bonus based upon the number of days of such
12 month period prior to the termination divided by 365 days.
(iii) Resignation. If Executive's employment is terminated
due to Executive's resignation, then Executive shall be entitled to receive
Executive's Annual Base Salary through the date of termination. All of
Executive's rights to Annual Base Salary and benefits hereunder which
accrue or become payable after the date of such termination of the
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Employment Period shall cease upon such termination. All of Executive's
rights to the Annual Bonus which accrue or become payable before or after
the date of such resignation shall terminate and cease upon such
resignation.
(iv) Termination With Cause. If Executive's employment is
terminated by the Company with Cause, then Executive shall be entitled to
receive Executive's Annual Base Salary through the date of termination.
All of Executive's rights to Annual Base Salary and benefits hereunder
which accrue or become payable after the date of such termination of the
Employment Period shall cease upon such termination. All of Executive's
rights to the Annual Bonus which accrue or become payable before or after
the date of such termination with Cause shall terminate and cease upon such
termination.
2. Confidential Information. Executive acknowledges that the
confidential and proprietary information, observations and data of the
Company obtained by Executive during the course of Executive's performance
under this Agreement concerning the business and affairs of the Company and
its Affiliates are the property of the Company, including information
concerning acquisition opportunities in or reasonably related to the
Company's business or industry of which Executive becomes aware during the
Employment Period. Therefore, Executive agrees that Executive will not
disclose to any unauthorized person outside the ordinary course of business
or use for Executive's own account any of such information, observations or
data without the Board's written consent, unless and to the extent that the
aforementioned matters become generally known to and available for use by
the public other than as a result of Executive's acts or omissions to act.
Executive agrees to deliver to the Company at the termination of the
Employment Period, or at any other time the Company may reasonably request
in writing, all memoranda, notes, plans, records, reports and other
documents (and copies thereof) relating to the business of the Company and
its Affiliates (including, without limitation, all acquisition prospects,
lists and contact information) which Executive may then possess or have
under Executive's control.
3. Noncompetition and Nonsolicitation.
(a) Noncompetition. Executive acknowledges that in the course
of Executive's employment with the Company Executive will become familiar
with the Company's trade secrets and with other confidential information
concerning the Company and that Executive's will be of special and unique
value to the Company. Therefore, Executive agrees that, during the
Employment Period and for one year thereafter (the "Noncompete Period"),
Executive shall not directly or indirectly own, manage, control,
participate in, consult with, render services for, or in any manner engage
in any business that provides services similar or identical to the services
provided by the Company or any of its Affiliates at the time of such
termination; provided, however, if the Company terminates Executive's
employment without Cause then the provisions of this Section 3(a) shall
terminate one month after the final payment of the Severance Payments
provided in Section 1(d)(i) hereof, unless the Company and Executive
mutually extend the Noncompete Period in which case the Company shall
continue to pay monthly Severance Payments and the Noncompete Period shall
be extended to include each month during which Severance Payments are made;
and further provided that the Noncompete Period shall terminate upon an
Event of Default under that certain Promissory Note of even date herewith
by and between Trinity Companies, Inc. (an Affiliate of the Company) and
Executive.
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(b) Nonsolicitation. During the term of the Employment Period
and the Noncompete Period, Executive shall not directly or indirectly
through another entity (i) induce or attempt to induce any employee of the
Company or any of its Affiliates to leave the employ of the Company or any
of its Affiliates, or in any way interfere with the relationship between
the Company or any of its Affiliates and any such employee thereof, (ii)
hire or engage, or offer to hire or engage, any employee of the Company or
any of its or Affiliates, or (iii) induce or attempt to induce any
customer, supplier, licensee or other business relation of the Company or
any of its Affiliates to cease doing business with the Company or such
Affiliate, or in any way interfere with the relationship between any such
customer, supplier, licensee or business relation and the Company or any of
its Affiliates.
(c) Enforcement. If, at the time of enforcement of Section 2 or 3 of
this Agreement, a court holds that the restrictions stated herein are
unreasonable under circumstances then existing, the parties hereto agree
that the maximum duration, scope or geographical area reasonable under such
circumstances shall be substituted for the stated period, scope or area and
that the court shall be allowed to revise the restrictions contained herein
to cover the maximum duration, scope and area permitted by law. Because
Executive's services are unique and because Executive has access to
confidential information, the parties hereto agree that money damages would
be an inadequate remedy for any breach of this Agreement. Therefore, in
the event a breach or threatened breach of this Agreement, the Company or
its successors or assigns may, in addition to other rights and remedies
existing in their favor, apply to any court of competent jurisdiction for
specific performance and/or injunctive or other relief in order to enforce,
or prevent any violations of, the provisions hereof (without posting a bond
or other security).
4. Board of Directors. The Company shall cause the number of seats
on its board of directors to remain at five (5) for the duration of the
Term.
5. Definitions.
"Affiliate" of any particular person or entity means any other
person or entity controlling, controlled by or under common control with
such particular person or entity.
"Cause" means (i) the conviction of a felony or a crime involving
moral turpitude or the commission of any act constituting intentional
dishonesty or fraud with respect to the Company or any of its Affiliates or
any of their customers or suppliers, (ii) failure to perform duties of the
office held by Executive as reasonably directed by the Board, (iii)
recklessness or willful misconduct with respect to the Company or any of
its Affiliates, or (iv) any material breach of Section 2 or 3 of this
Agreement; provided, however, that in the case of (ii) through (iv), such
failure or breach is not cured (or such recklessness or willful misconduct
does not cease) within 30 days after Executive receives written notice
thereof from the Board.
"Disability" means the inability, due to illness, accident,
injury, physical or mental incapacity or other disability, of Executive to
carry out effectively his or her duties and obligations to the Company or
to participate effectively and actively in the management of the Company
for a period of at least 180 days (whether or not consecutive) during any
365-day period, as determined in the reasonable judgment of the Board after
receipt of competent medical advice.
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"Fiscal Year" means the year that ends on December 31.
"Good Reason" means any of the following: (i) a reduction by the
Company in Executive's then Annual Base Salary, (ii) the relocation of
Executive to a location outside the greater Gold Coast area (excluding
travel on Company business to an extent substantially consistent with
Executive's past business travel obligations), unless Executive has
consented in writing to such relocation; (iii) the removal of Executive
from, or failure to reelect Executive to, his position as Chief Executive
Officer and/or director of the Company, other than a removal for Cause,
without his consent; or (iv) any material breach by the Company of any
material provision of this Agreement. With respect to (iv) above, the
event prompting Executive's termination hereunder must continue for more
than thirty (30) days after notice given to the Company, such notice to set
forth in reasonable detail the nature of such event.
"Person" means an individual, a partnership, a limited liability
company, a corporation, an association, a joint stock company, a trust, a
joint venture, an unincorporated organization and a governmental entity or
any department, agency or political subdivision thereof.
6. Notices. All notices and other communications given or made
pursuant hereto shall be in writing and shall be deemed to have been duly
given or made as of the date delivered if delivered personally or by
telecopy or seven (7) days after being mailed by registered or certified
mail (postage prepaid, return receipt requested) to the parties at the
following addresses (or at such other address for a party as shall be
specified by like notice, except that notices of changes of address shall
be effective upon receipt):
If to the Company:
Trinity Companies, Inc.
0000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (___) __________
with a copy to:
Xxxxxxx Xxxxx & Xxxxxxx
000 Xxxxx 000 Xxxx, Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000
Attention: Xxxxx Xxxxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to Executive:
Xxxxx Xxxxxxx
XX Xxx 000
XXXXXXXXXX
Xxxxxxxxx
Telephone: (___)_________
Facsimile: (___)__________
or to such other address or to the attention of such other person as the
recipient party has specified by prior written notice to the sending party.
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7. General Provisions.
(a) Severability. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
invalid, illegal or unenforceable in any respect under any applicable law
or rule in any jurisdiction, such invalidity, illegality or
unenforceability will not affect any other provision or any other
jurisdiction, but this Agreement will be reformed, construed and enforced
in such jurisdiction as if such invalid, illegal or unenforceable provision
had never been contained herein.
(b) Complete Agreement. This Agreement, the exhibits attached
hereto, those documents expressly referred to herein and other documents
executed by the Company and Executive of even date herewith embody the
complete agreement and understanding among the parties and supersede and
preempt any prior understandings, agreements or representations by or among
the parties, written or oral, which may have related to the subject matter
hereof in any way.
(c) Counterparts. This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which
taken together constitute one and the same agreement.
(d) Successors and Assigns. Except as otherwise provided herein,
this Agreement shall bind and inure to the benefit of and be enforceable by
Executive, the Company, and their respective successors and assigns;
provided that the rights and obligations of Executive under this Agreement
shall not be assignable.
(e) Choice of Law. All questions concerning the construction,
validity and interpretation of this Agreement and any exhibits hereto will
be governed by and construed in accordance with the internal laws of the
State of Utah, without giving effect to any choice of law or conflict of
law provision or rule (whether of the State of Utah or any other
jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Utah.
(f) Remedies. Each of the parties to this Agreement will be entitled
to enforce its rights under this Agreement specifically, to recover damages
and costs (including attorney's fees) caused by any breach of any provision
of this Agreement and to exercise all other rights existing in its favor.
The parties hereto agree and acknowledge that money damages may not be an
adequate remedy for any breach of the provisions of this Agreement and that
any party may in its sole discretion apply to any court of law or equity of
competent jurisdiction (without posting any bond or deposit) for specific
performance and/or other injunctive relief in order to enforce or prevent
any violations of the provisions of this Agreement.
(g) Amendment and Waiver. The provisions of this Agreement may be
amended and waived only with the prior written consent of the Company and
Executive.
IN WITNESS WHEREOF, the parties hereto have executed this Employment
Agreement on the date first written above.
COMPANY:
Competency Based Learning Pty. Ltd.
ACN 084 763 780
By:
Its:
EXECUTIVE
Xxxxx Xxxxxxx
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EXHIBIT A
Bonus Plan Criteria
Within 90 days of the end of each fiscal year, Executive shall be
entitled to receive an Annual Bonus of USD $5,000 for every USD $100,000 in
revenues of CBL Acquisition Corp., a Utah company and parent corporation of
the Company ("CBLAC"), together with its subsidiaries, exceeding USD
$2,700,000 actually received by CBLAC and its subsidiaries (the "Revenue
Threshold"); provided, however that CBLAC, together with its subsidiaries,
is Profitable in the year for which such Annual Bonus is calculated.
Notwithstanding the foregoing, for the first partial year of Executive's
employment, the Revenue Threshold shall equal to the product of (i) the
Revenue Threshold multiplied by the quotient of (a) the number of days
Executive is employed during the fiscal year divided by (b) 365 days. For
purposes of this Exhibit A, "Profitable" shall mean that CBLAC, together
with its subsidiaries, has a positive net income calculated in accordance
with generally accepted accounting principles as applied in the United
States after giving effect to the Annual Bonus and the annual bonuses of
other officers and employees of the CBLAC and its subsidiaries.
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