EXHIBIT 10.14
REVISED: SEPTEMBER 9, 1999
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT (the "Agreement") is entered into
as of the 24th day of August, 1999 between Xxxxxx Xxxx, (the "Executive"), whose
address is 0000 X. Xxxxxxx Xxxxxx, Xxxxxxxxx, XX 00000, and SecurFone America,
Inc., a Delaware corporation ("SecurFone" or "Company") whose address is 0000
Xxxxxxx Xxxxxx, Xxxxx 000, Xxx Xxxxx, XX 00000.
RECITALS:
WHEREAS, SecurFone wishes to obtain the services of the Executive;
and
WHEREAS,the Executive desires to obtain employment with SecurFone
pursuant to the terms of this Agreement;
NOW THEREFORE,in consideration of the mutual promises contained
herein and other consideration the receipt and sufficiency of which is
hereby acknowledged, the Executive and SecurFone agree as follows:
1. EMPLOYMENT. SecurFone will employ the Executive as Vice President
and Chief Financial Office of SecurFone.
2. DUTIES. The Executive will devote his full time efforts to the
business of SecurFone and its related organizations performing such duties as
are customary to his position and as may be reasonably requested by the Chief
Executive Officer or Board of Directors of SecurFone. The Executive will at
all times conduct himself in conformity with the policies of SecurFone. The
Executive is required to perform the following duties and responsibilities:
a. Develop and implement SecurFone's overall business and
financial plan for securing a leadership position in the
market for Internet-based, electronic commerce and related
services.
b. Assume overall financial responsibility to support SecurFone's
filings with the SEC and other government authorities as
appropriate
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c. Assist in managing relationships with financial institutions
and funding sources to meet company's funding needs and
maximize shareholder value
c. Assume overall fiduciary responsibility for SecurFone's
consolidated business operations including ensuring proper
controls and reporting processes are implemented
d. Identify and pursue new acquisition targets which are
consistent with SecurFone's strategic plan and maximize
shareholder value
3. COMPENSATION. For the performance of his duties during the
term of this Agreement, the Executive will earn an annual
salary of $120,000 of which the annualized salary will be
payable on a weekly basis. Executive agrees to defer
$3,000 per month and will be paid $7,000 per month starting
August 20, 1999 on a weekly basis. The continued agreement
to defer salary is contingent upon the timely and
uninterrupted flow of weekly salary payments. Future
deferred salary will be eliminated after Board approval and
new funding is received by the Company adequate to cover
staff salary needs.
4. STOCK OPTION BENEFIT. The Company will grant both Qualified and
Non-Qualified Stock Options which will be granted based upon the
Executive's successful performance, and the ability of the Company
to meet specified objectives. The option schedule is set forth
below.
a. The Company shall grant to the Executive
Non-Qualified Options for 20,000 shares of the
Company's Common Stock. The Option shall be granted
pursuant to a Plan adopted by the Company's Board of
Directors and approved by the Company's Shareholders.
The exercise price of the Option per share is to be
$0.10 per share, or the current market price upon the
date of this Agreement, whichever is lower. This
Option shall become exercisable one year from the
date of this Agreement. The maximum number of shares
exercisable under this option is 5,000 shares per
month.
b. The Company shall grant to the Executive Qualified
Incentive Options for 15,000 shares of the Company's
Common Stock. The Option shall be granted pursuant to a
Plan adopted by the Company's Board of Directors and
approved by the Company's Shareholders. The exercise
price of the Option per share is to be the current
market price upon the date of this Agreement. The
Option shall be exercisable by the Executive upon
SecurFone achieving a minimal market capitalization of
$50 million based on the average closing market prices
for a five-day period. The maximum number of shares
exercisable under this option is 5,000 shares per
month.
c. The Company shall grant to the Executive Qualified
Incentive Options for 10,000 shares of the Company's
Common Stock. The Option shall be granted pursuant to a
Plan adopted by the Company's Board of Directors
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and approved by the Company's Shareholders. The exercise
price of the Option per share is to be the current
market price upon the date of this Agreement. The
Option shall be exercisable by the Executive within
seven days after the Company reports positive cash flow
from operations for a minimum 60 day period. The
maximum number of shares exercisable under this option
is 5,000 shares per month.
5. d. Executive agrees that his sale of the stock received upon
exercise of the options granted pursuant to this Agreement will
also be subject to the volume limitations contained in Rule
144(e)(1) promulgated under the Securities Act of 1933.
Notwithstanding this provision, the maximum number of shares
that the Executive can exercise in any thirty day period is
5,000 shares for the options granted above. BENEFIT PLANS.
During the term of this Agreement,Executive shall be entitled
to participate in all employee benefit plans which are
maintained or established by the Company from time to time and
which cover SecurFone's senior executives, provided he
satisfies any applicable eligibility requirements therefor.
Executive shall be entitled to participate in other cash and
stock incentives as granted at the discretion of the Board of
Directors based on achieving selected milestones. Executive
acknowledges the right of the Company to amend or terminate
such plans at any time in the exercise of its discretion.
Executive further acknowledges that the Company may wish to
maintain insurance on his life for its benefit and agrees to
submit to any physical examination which may be required in
order to obtain such insurance. SecurFone has no current
employee benefit plan in existence. Executive shall receive
three (3) weeks paid vacation per year, commencing upon
execution date of this Agreement.
6. EXPENSES. The Executive will be reimbursed in a timely manner for
all reasonable expenses incurred by him in performing his duties
hereunder, provided that such expenses are incurred and accounted
for in accordance with the policies and procedures established by
SecurFone.
7. TERMINATION OF EMPLOYMENT.
a. DEATH; DISABILITY. In the event of Executive's death or
Disability (as hereinafter defined), his employment with
the Company shall be deemed terminated as of the end of
the month in which such death or Disability occurs, and
all rights, duties and obligations of the parties
hereunder shall thereupon cease, except that in the case
of the termination due to Disability, Executive's
obligations under Section 11 shall continue. For purpose
of this Section, Disability shall be deemed to have
occurred if (a) Executive shall be unable to perform his
duties on an active full-time basis by reason of
disability or impairment of health for a period of at
least ninety (90) consecutive calendar days or (b) the
Company shall have received a certificate from a physician
reasonably acceptable to both the
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Company and the Executive (or his representative) to the
effect that Executive is incapable of reasonably performing
services under this Agreement in accordance with past
practices.
b. BY COMPANY FOR GOOD CAUSE. Executive's employment with the
Company may be terminated at the option of and by written
notice from the Company if the Board of Directors of the
Company shall find Good Cause for termination. For
purposes of this Agreement, Good Cause shall mean only (i)
Executive's willful failure to perform his duties under
this Agreement within a reasonable period of time after
receipt of written notice from the Company setting forth
in reasonable detail the duties which Executive has failed
to perform and the corrective actions expected of him;
(ii) a breach of Executive's duty of loyalty to the
Company, including but not limited to a breach of
Executive's obligations under Sections 10 or 11 below;
(iii) indictment for, conviction of, or written confession
to a crime against the Company or a crime which otherwise
materially adversely affects Executive's ability to
perform his obligations under this Agreement, any business
relationship which the Company maintains or the general
reputation and good will of the Company; or (iv) Executive
shall have been found by the Board of Directors of the
Company to have been repeatedly and excessively using
alcohol, drugs and/or any other intoxicating or controlled
substance. Upon any such termination all rights,
obligations and duties of the parties hereunder shall
immediately cease, except that the Company shall fulfill
its obligations to Executive under Section 8 hereof, and
except for Executive's obligations under Sections 10 and
11 hereof.
c. BY COMPANY WITHOUT GOOD CAUSE. The Company may also
terminate Executive's employment at any time by written
notice without Good Cause, whereupon all rights,
obligations and duties of the parties hereunder shall
immediately cease, except that the Company shall fulfill
its obligations to Executive under Section 8 hereof, and
except for Executive's obligations under Section 11 hereof.
d. BY EXECUTIVE FOR GOOD REASON. Executive may terminate his
employment with the Company upon not less than thirty (30)
days advance written notice for "Good Reason." Upon the
effective date of any such termination all rights,
obligations and duties of the parties hereunder shall
immediately cease, except that (i) the Company shall
fulfill its obligations to Executive under Section 8(a)
hereof, (ii) the Company shall fulfill its obligations to
Executive under Section 8(b) hereof, and (iii) Executive's
obligations under Section 11 hereof shall remain
effective. For purposes of this Agreement, the Executive
will have "Good Reason" if (iv) the Board of Directors of
SecurFone shall fail to reelect, or shall remove Executive
from the office of Chief Financial Officer of SecurFone,
(v) the
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Board of Directors of SecurFone shall make a significant
negative change in the nature of scope of the authorities,
powers, functions or duties of Executive hereunder, (vi)
the Company shall fail to pay when due any compensation
provided for in this Agreement and provided for under
previous agreements entered into between the Company and
the Executive and such failure is not corrected within
thirty (90) days after notice thereof to the Company by
the Executive, or (vii) any pattern of conduct done with
the approval of the Board of Directors of the Company
which impedes the Executive in the exercise of his
authorities, powers, functions or duties, hereunder in the
manner in which they would normally be exercised by the
Chief Financial Officer.
e. BY EXECUTIVE WITHOUT GOOD REASON. Executive may terminate
his employment with the Company upon not less than thirty
(30) days advance written notice. Upon the effective date
of any such termination all rights, obligations and duties
of the parties hereunder shall immediately cease, except
for Executive's obligations under Sections 10 and 11
hereof; provided, however, that the Company shall not be
prohibited from terminating Executive under Section 7(c)
above following receipt of a notice of termination from
Executive, subject to its obligations thereunder.
8. TERMINATION COMPENSATION: SEVERANCE PAY. If Executive's employment
is terminated pursuant to Section 7(c) or 7(d), Executive shall be entitled to
the continued payment of the annual salary described in Section 3 above for a
period of three (3) months following such termination. If Executive's employment
is terminated pursuant to Section 7(b) or 7(e), Executive shall be entitled to
the continued payment of the annual salary described in Section 3 until the last
date of employment with the company.
9. TERM. This Agreement will continue in effect from July 1, 1999
until July 1, 2000 unless sooner terminated under Section 7 hereof. The
Agreement shall automatically renew from year to year unless either party gives
no less than thirty (30) days and no more than ninety (90) days of its/his
intent not to renew this Agreement.
10. NON-COMPETITION.
a. RESTRICTIONS. As consideration for the compensation and
benefits to be provided to the Executive under this
Agreement, and assuming all conditions set forth in the
Agreement are met by Securfone, the Executive will not
during the term of this Agreement and for a period of six
months (6) thereafter if Executive's employment is
terminated pursuant to Section 7(b) or 7(e), directly or
indirectly, for himself or for others, in any state of the
United States or in any foreign country where SecurFone or
any of its Affiliates (as defined below) is then conducting
the Business (as defined below) or has, during the previous
six (6) months, conducted the business:
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(1) engage in the Business;
(2) render advice, consultation, or services
to or otherwise assist any other person or entity who
competes, directly or indirectly, with SecurFone or
any of its Affiliates;
(3) transact any business in any manner
pertaining to suppliers or customers of SecurFone or
any of its Affiliates which, in any manner, would
have, or is likely to have, an adverse effect upon the
conduct of the Business of SecurFone or any of its
Affiliates; or
(4) induce any employee, agent or
representative of SecurFone or any of its Affiliates
to terminate his or her employment with SecurFone or
such Affiliate.
b. DEFINITIONS. For purposes of this Section 10, the
"Business" will mean the business activities of
SecurFone and its Affiliates in the business of
offering Internet-based , electronic commerce services
in the travel and hospitality sectors. The term
"Affiliates" shall mean any entity controlling,
controlled by or under common control with SecurFone,
including, but not limited to, SecurFone divisions and
subsidiaries, and any licensee, franchisee or agent of
SecurFone products or services.
c. REASONABLENESS; ENFORCEMENT. The Executive
understands that the foregoing restrictions may limit
his ability to engage in certain business pursuits
during the period provided for above, but acknowledges
that he will receive sufficiently higher remuneration
and other benefits from SecurFone hereunder than he
would otherwise receive to justify such restriction.
The Executive acknowledges that he understands the
effect of the provisions of the provisions of this
Section 10, and that he was encouraged to and had an
opportunity to consult an attorney with respect to
these provisions. SecurFone and the Executive consider
the restrictions contained in this Section 10 to be
reasonable and necessary. Nevertheless, if any aspect
of these restrictions is found to be unreasonable or
otherwise unenforceable by a Court of competent
jurisdiction, the parties intend for such restrictions
to be modified by such Court so as to be reasonable
and enforceable and, so as modified by the Court, to
be fully enforced. In the event of a breach or
threatened breach of this Section 10 by Executive,
SecurFone will be entitled to preliminary and
permanent injunctive relief, sufficient to enforce the
provisions thereof and SecurFone will be entitled to
pursue such other remedies at law or in equity which
it deems appropriate.
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11. CONFIDENTIAL INFORMATION.
a. PROHIBITION ON DISCLOSURE OR USE OF CONFIDENTIAL
INFORMATION. The Executive will at all times keep and
maintain Confidential Information (as defined below)
confidential and will not, at any time, either during or
subsequent to his employment with SecurFone, unless required
by law or order, either directly or indirectly, use any
Confidential Information for his own benefit, or otherwise
divulge, disclose, or communicate any Confidential
Information to any person or entity in any manner
whatsoever, other than employees or agents of SecurFone or
its Affiliates who have a need to know such information, and
then only to the extent necessary to perform their
responsibilities on behalf of SecurFone or its Affiliates.
b. DEFINITION OF CONFIDENTIAL INFORMATION. "Confidential
Information" will mean any and all information (excluding
information in the public domain) relating to the Business,
including, without limitation, all patents and patent
applications; copyrights (whether registered or to be
registered in the United States or elsewhere) which are
applied for, issued to or owned by SecurFone or any of its
Affiliates; inventions; trade secrets; computer programs;
engineering and technical data; drawings or designs;
manufacturing techniques; information concerning pricing and
pricing policies; marketing techniques; suppliers; methods
and manner of operations; and information relating to the
identity and location of all past, present and prospective
customers.
c. ENFORCEMENT. the Executive's obligations contained in
this Section 11 are of a special and unique character which
gives him a peculiar value to SecurFone. The parties
recognize that SecurFone cannot be reasonably or adequately
compensated in damages alone in an action at law should the
Executive breach such obligations. The Executive therefore
expressly agrees that, in addition to any other rights or
remedies which SecurFone may possess, it will be entitled to
injunctive and other equitable relief in the form of
preliminary and permanent injunctions, without bond or other
security, in the event of any actual or threatened breach of
such obligations by the Executive, in order to enforce this
Section 11.
12. SUCCESSORS. This Agreement is personal to the Executive and will
not be assignable by him without the prior written consent of SecurFone, except
that Executive's right to receive compensation may be assigned by Executive, in
writing. Any amounts payable after the death of the Executive shall be paid to
the executor or administrator of his estate. This Agreement will inure to the
benefit of and be binding upon SecurFone, its Affiliates and their successors
and assigns.
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13. INDEMNIFICATION. The Certificate of Incorporation of the Company
provides, in Article VII thereof, captioned "Indemnification", that the Company
shall indemnify certain persons under certain conditions. The Company agrees
that the Executive shall be a person covered by the attached Article VII, that
the Executive shall be entitled to the benefit of all of the provisions of
Article VII, and that such provisions shall remain in full force and effect with
respect to the Executive throughout the term of this Agreement, without regard
to any amendment to Article VII which might be adopted after the date hereof.
The Company agrees that to the extent the Company's obligations under this
paragraph are insurable, the Company agrees to purchase insurance, in the amount
of $2,500,000 to secure the Company's obligations hereunder.
14. TIME. The parties acknowledge that time is of the essence in the
performance of the obligations of each party hereto, and that the timely
performance of such obligations is a pre-condition to the continuation of the
obligations of the other party.
15. GOVERNING LAW. This Agreement will be governed by and construed in
accordance with the laws of the Commonwealth of Virginia without reference to
principles of conflict of laws. Any action brought to enforce this Agreement or
to seek relief based upon any provision of it will be brought in a court of
competent jurisdiction in the Commonwealth of Virgina.
16. MERGER. This Agreement supersedes any and all prior agreements,
whether written or oral, with respect to the Executive's employment by SecurFone
or any of its Affiliates and contains all of the promises, representations,
warranties and agreements between the parties with respect to such employment.
17. MODIFICATION. This Agreement may not be amended or modified
otherwise than by a written agreement executed by the parties or their
respective successors.
18. NOTICES. All notices or other communications hereunder will be in
writing and will be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, to the following:
If to the Executive:
Xxxxxx Xxxx
0000 X. Xxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
If to SecurFone:
SecurFone America, Inc.
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
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With a copy to:
Xxxxxxxxxxx Xxxxxxx, Esq.
Xxxxxxx Xxxxxxx & Xxxxxx P.L.L.
00xx Xxxxx, Xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Any party may from time to time change its address for purposes of this
Agreement by giving notice of such change to the other party, but no such
change will be deemed effective until actually received by the party to whom it
is directed. Notice and communications under this Agreement will be effective
when actually received by the party to whom they are directed.
IN WITNESS WHEREOF the parties have executed this Agreement the day and
year written above.
SECURFONE AMERICA, INC.
a Delaware corporation
By: Xxxx X. Xxxxxxxxx
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Its: CEO
/s/ Xxxxxx X. Xxxx
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XXXXXX XXXX
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