EXHIBIT 10.6
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made this 25th of October, 1999 between IAM
Group, Ltd., a New York Corporation, (the Employer), located at 00 Xxxxx Xxxxxx,
Xxx Xxxx Xxx Xxxx and Xxxxxxx X. Xxxxx, Esq. (the Employee), residing at 00
Xxxxxxxxx Xxxxx, Xxx Xxxxx, Xxx Xxxx 00000. In consideration of the mutual
covenants contained in this Agreement, the Employer and Employee hereby agree as
follows:
RECITALS
The Employer, IAM Group, Ltd., ("IAM") recently entered into agreements to merge
with or to purchase all of the assets of the following companies: Guardian
Internet Services, Inc., Internet Solutions of Vero Beach, Inc., Computer
Solutions of Vero Beach, Inc. and A Virtual Presence, Inc., and Pro-Star
Athletic of Florida, Inc.
The Employee is admitted to practice in New York State and has the requisite
experience to render general corporate legal services to further the business
interests of IAM on a full time basis.
It is the intent of the Employer to develop a national and international
manufacturing and marketing business for sports apparel through license
agreements, and to design, develop and market an E-Commerce business through its
wholly owned Internet Service Provider business: Guardian Internet Solutions,
Inc. As a material inducement for the Employer to accomplish its business
purposes, the Employee has accepted a position as a Vice-President of Legal
Affairs for IAM, whose duties shall include general corporate legal services as
well as promoting the business interests of Employer.
ARTICLE 1
TERM OF EMPLOYMENT
The Employer employs Employee and Employee accepts employment with the Employer
for a period of three years beginning on the Effective Date of the Private
Placement Offering ("PPO'), or on November 1, 1999 whichever date is sooner;
however, the employment date for the Employee may be accelerated at the
Employer's option.
At the sole discretion and option of the Employer, the Employer may extend this
Agreement for an additional period of three years if Employee has satisfactorily
performed all duties under this Agreement. If the Employer intends to exercise
the right to extend the term of employment, the Employer shall notify Employee
in writing before the end of the original term of employment under this
Agreement. Employee shall accept the offer to renew by written notice to the
Employer within 30 days from receipt of the offer. Employment during any
extended term shall be governed by the terms of the offer submitted. If the
renewal offer is refused, Employee shall remain with the Employer until a
successor counsel is obtained.
The Employer has been advised that Employee's employment as an attorney is
terminable at any time if the legal services rendered are unsatisfactory for any
reason. If the Employer terminates without Employee's services without cause,
Employee shall continue to receive his basic salary, personal expenses and
medical insurance coverage during the term of this Agreement until he is
re-employed or one year after he establishes a law office and engages in the
practice of law. At such time as Employee is re-employed or establishes a law
office and engages in the practice of law for one year, he shall receive
one-half his basic salary for the remainder of the term of the Agreement.
ILLNESS, DISABILITY AND DEATH
In event of illness, disability or death employee or his survivor shall be
entitled to receive compensation as provided by the Employer pursuant to a
separate corporate policy statement to cover all officers, directors and
executives of the employer.
ARTICLE 2
DUTIES OF EMPLOYEE
The primary responsibilities of Employee shall be as follows:
To provide legal services and advice whenever required over
all operations, projects, subsidiaries or affiliates of IAM. Assist in execution
and completion of corporate business including but not limited to legal aspects
of day to day operations of the Employer, in-house corporate legal services, SEC
regulatory requirement filings, private placement offerings, and initial public
offerings.
Except to arrange for the orderly turnover of present clients
and to render legal services for those cases pending in Employee's office,
Employee shall devote his entire working time to the duties of the Employer and
shall not conduct personal business or engage in work for any other person or
entity during the term of this agreement. Employee shall perform all duties in
compliance with the directions and according to the policies of the Employer, as
long as the directions and policies are reasonable to both parties.
The duties of Employee may be changed from time to time by
mutual consent of Employer and Employee. Notwithstanding any such change, the
employment of Employee shall be construed as continuing under this Agreement as
modified.
Until the Employer has the financial resources to retain the
services of a Human Resources or Personnel Administrator, in addition to his
duties as Vice-President for legal affairs, Employee agrees to act as the Human
Resources and Personnel Officer for IAM.
2
Satisfactory Performance of Duties
The employment of Employee shall continue so long as the services rendered by
Xxxxx are satisfactory to the Board of Directors of the Employer. The Board of
Directors of Employer shall evaluate Employee's performance every 6 months.
Place of Employment
At the commencement of the employment, Employee shall perform his duties at the
office of the Employer located at 00 Xxxxx Xxxxxx, Xxx Xxxx Xxx Xxxx. or at such
other location where the Employer maintains its principal place of business.
Employee shall relocate to the Employer's offices on the Effective Date of the
PPO or sooner if Employer elects to accelerate the beginning date of this
employment agreement.
Office Facilities
Employer shall operate and maintain facilities, and shall provide at its
expense, the necessary equipment and supplies, suitable to employee's position
and adequate for the performance of his legal services under and pursuant to
this Agreement. Further, Employer shall supply and pay for legal secretarial
services reasonably needed by employee in connection with his employment.
Engaging In Other Employment
Xxxxx shall devote his entire productive time, ability, and attention to the
business of the Employer during the term of this Contract. Xxxxx shall not
directly or indirectly render any services of a business, commercial, or
professional nature to any other person or organization, whether for
compensation or otherwise, without the prior written consent of the Employer.
The Employer recognizes that Xxxxx has current pending legal matters which he
can complete provided they do not adversely conflict with Employer's
requirements.
Matters Requiring Consent of Board of Directors
Xxxxx shall not, without specific approval of the Board of Directors of the
Employer, do or contract for any of the following:
1. Borrow money on behalf of the Employer during any fiscal
year an amount in excess of $100.
2. Permit any customer of Employer to become indebted to the
Employer in an amount in excess of $100.
3. Purchase capital equipment in excess of expenditures
budgeted by the Board of Directors.
4. Sell any single asset of the Employer having a market value
in excess of $100 without approval of the Board of Directors.
3
5. Pay any office expenses and/or reimbursable expenses
without approval of the President.
ARTICLE 3
COMPENSATION OF EMPLOYEE
Basic Salary
As compensation for all services rendered under this Agreement, Employee shall
receive a salary of $150,000.00 per year, payable in equal weekly or bi-monthly
installments during the period of employment, prorated for any partial
employment period. After 6 months of employment, Xxxxx'x salary shall be
re-evaluated based on meeting IAM'S budget and sales projections. In any event
Xxxxx shall receive minimum increases of salary of 2% for each six month period
following the first year of employment. Salary may be changed by mutual
agreement of the parties at any time. In the event Employer elects to accelerate
the date of employment, Employee shall be paid at the rate of $10,000.00 per
month plus medical insurance and reimbursement for reasonable expenses incurred
on behalf of IAM.
Bonus
In the event employer pays bonus' to officers and executive employees on or
before the last day of each fiscal year of the corporation, Xxxxx shall be
entitled to receive a bonus as negotiated with the employer.
Expenses
During the term of this Agreement, employer shall pay all reasonable business
expenses of employee in accordance with the general policy of employer including
but not limited to professional license fees, dues to State and County Bar
Associations, educational expenses incurred to maintain or improve employee's
professional skills, and for employee's actual expenses for travel, room and
meals for attending professional conventions. Employee agrees to submit to
employer such documentation as may be necessary to substantiate such expenses.
Fringe Benefits
As additional compensation, the employer shall provide the following further
benefits not to exceed twenty thousand ($20,000.00) per year:
(1) Automobile lease
(2) Automobile insurance expenses
(3) Cell phone expenses
(4) Automobile repairs and maintenance
4
Additional Benefits
In the event IAM Group, Inc., offers pension, welfare or employee stock benefit
or incentive programs, to its executives, Employee shall be included therein.
Within a reasonable time after PPO, Employer shall provide family medical
insurance coverage for Employee.
Holidays
Employee shall be entitled to eight days for all national legal holidays, to be
scheduled in advance by Employer and Employee.
Vacation
After the first year of employment Employee shall be entitled to two weeks paid
vacation time. After the second year Employee shall receive three weeks paid
vacation time. All vacation time is to be scheduled in advance by Employer and
Employee.
ARTICLE 4
NON COMPETITION OF EMPLOYEE
Non Competition During Term of Employment
During the term of this Agreement, Employee shall not, directly or indirectly,
either as an employee, employer, consultant, agent, principal, partner,
stockholder, corporate officer, director, or in any other individual or
representative capacity, engage or participate in any business that is in
competition in any manner whatsoever with the business of Employer.
Post-Employment Noncompetition
Employee agrees that, upon termination of employment for cause, he shall not
directly or indirectly engage in competition with the Employer for a period of
two years from the date of termination. As used in this paragraph, "competition
with the Employer" means entering or engaging in the business of: Internet
Service Provider offering exclusive or optional filtered access service to its
users, either individually, or as a partner, or as a member of a joint venture,
or as an employee, or as an agent, officer, director, or shareholder of any
entity or person or entering or engaging in the apparel licensing business. This
covenant shall be construed as an agreement independent of any other provision
of this employment agreement. The existence of any claim or cause of action of
Employee against the Employer, whether predicated on this agreement or otherwise
shall not constitute a defense to the enforcement by the Employer of this
covenant. In the event of a breach or threatened breach by Employee of the
obligations under this paragraph, Employee acknowledges that the Employer will
not have an adequate remedy at law and shall be entitled to such equitable and
injunctive relief as may be available to restrain Employee from the violation of
the provision of this paragraph. Nothing in this paragraph shall be construed as
prohibiting the Employer from pursuing any other remedies available for breach
or threatened breach of this covenant not to compete, including the recovery of
damages from Employee.
5
ARTICLE 5
PROPERTY RIGHTS OF THE PARTIES
Soliciting Customers After Termination of Employment
Employee shall not for a period of two years immediately following the
termination of this employment with Employer, either directly or indirectly:
1. Make known to any person, firm, or corporation the names or
addresses of any of the customers of the Employer or any information pertaining
to them;
2. Call on, solicit, or attempt to call on, solicit or take
away any of the customers of the Employer.
Ownership of Customer Records
All customer agreements, and any other agreements and books relating to the
Employer, whether prepared by Employee or otherwise coming into his possession,
shall be the exclusive property of the Employer. All agreements, records and
books shall be immediately returned to the Employer on termination of
employment.
Ownership of Legal Records
All legal records relating to IAM, whether prepared by Employee or otherwise
coming into his possession, shall be the exclusive property of the Employer. All
legal records and books shall be immediately returned to the Employer on
termination of employment.
ARTICLE 6
TERMINATION OF EMPLOYMENT
If Employee willfully breaches or habitually neglects his duties or fails to
perform the duties he is required to perform under this Agreement, the Employer
may, at the Employer's option, terminate this Agreement by giving written notice
of the termination to Employee. Such termination shall not prejudice any other
remedy to which the Employer may be entitled either at law, equity, or under
this Agreement.
6
Effect of Termination on Compensation
In the event of termination of this Agreement other than for willful breach or
habitual neglect of duties, Employee shall be entitled to the compensation
earned by him prior to the date of termination as provided for in this Agreement
and to all future compensation and benefits entitled to be received during the
term of this Agreement.
Damages for Breach of Contract
In the event of breach of this Agreement by either the Employer or Employee
resulting in damages to the other party, that party may recover from the party
breaching the Agreement any and all damages that may be sustained, unless the
Employer pays future compensation and benefits for the remainder of the term of
this Agreement. In the event Employee sues and prevails in a breach of contract
action, damages will be limited to compensation, benefits and reasonable
attorney fees.
Attorney's Fees and Costs
If any action at law or in equity is necessary to enforce or interpret the terms
of this Agreement, the prevailing party shall be entitled to an award of
reasonable attorney fees, costs, and necessary disbursements in addition to any
other relief that the party may be entitled.
Entire Agreement
This Agreement supercedes any and all other agreements, whether oral or in
writing, between the parties with respect to the employment of Employee by the
Employer, and this Agreement contains all of the covenants and agreements
between the parties with respect to the employment in any manner whatsoever.
Each party to this Agreement acknowledges that no representations, inducements,
promises, or agreements, orally or otherwise, have been made by any party, that
are not embodied in this Agreement, and that no other agreement, statement, or
promise not contained in this Agreement shall be valid or binding. Any
modification to this Agreement will be effective only if it is in writing signed
by the party to be charged.
AGREED TO AND ACCEPTED this 25th day of October, 1999.
EMPLOYER: EMPLOYEE:
IAM GROUP LTD.
By: /s/ XXXX XXXXXXXX By: /s/ XXXXXXX XXXXX, ESQ.
------------------------ -----------------------
Xxxx Xxxxxxxx, President
7
