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EXHIBIT 10.25
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is effective as of the 1st day
of November, 1998 by and between PRIORITY INTERNATIONAL COMMUNICATIONS, INC.
("PIC"), PIC RESOURCES CORPORATION ("PICR"), both Texas corporations having
their offices and place of business at 0000 Xxxx Xxxxx, Xxxxx 000, Xxxxxx, Xxxxx
00000 (hereinafter PIC and PICR are collectively referred to as the "Company"),
XXXXXXX COMMUNICATIONS CORPORATION, an affiliate of the Company which guarantees
the obligation of the Company hereunder (hereinafter called "Xxxxxxx") and
XXXXXX X. XXXXXXXXX, an individual currently residing at 0000 Xxxxxx Xxxx 000,
Xxxxxxxxx, Xxxxx (hereinafter referred to as "Employee").
WITNESSETH
WHEREAS, The Company is currently engaged in the telecommunications
business;
WHEREAS, Employee currently is employed by the Company;
WHEREAS, the Company and Employee desire to renegotiate the terms of
employment whereby the Employee is employed by the Company; and
WHEREAS, Employee desires to be so employed by the Company;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the Company and Employee hereby agree as follows:
1. EMPLOYMENT TERM, The Company agrees to employ Employee, and
Employee agrees to be so employed under the terms and conditions of this
Agreement. Employment shall be for a term of three (3) years effective as of
November 1, 1998 and terminating thirty-six (36) months thereafter. This
Agreement shall thereafter be automatically renewed for successive additional
terms of one (1) year each unless either party gives the other at least one (1)
year prior written notice of its intent not to renew the Agreement.
2. TIME AND EFFORTS. Employee shall conscientiously devote
substantially all of his business time and attention in discharging his duties
to the Company as defined herein. Employee may serve on the board of directors
of other entities and engage in such civic activities and passive investment
activities as long as such activities do not materially interfere with
Employee's duties hereunder. Provided, however, that he shall not serve as a
director of a company which competes with the Company or Xxxxxxx.
3. DUTIES. Employee shall be employed as the Vice President and Chief
Financial Officer of each of PIC and PICR and as such shall report to the
President and the Board of Directors of each such Company. Employee's duties
shall be: (a) those generally performed by similarly situated officers with
Employee's title, (b) those generally performed by a chief operating officer of
a similarly situated company, and (c) those generally performed by a senior
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vice president of development for a similarly situated company, as the same may
be assigned by the President or the Board of Directors of PIC and PICR. In the
performance of his duties, Employee shall make his principal office in the
Austin, Texas area.
4. COMPENSATION. As compensation for his services hereunder, the
Company shall pay to Employee a base salary at the rate of $144,000.00 per
annum, which salary shall be paid to Employee in accordance with the general
practice of the Company. Salary payments shall be subject to withholding and
other applicable taxes. In addition to the foregoing, Employee shall be entitled
to receive an annual salary bonus at the good faith discretion of the Board of
Directors and the Company agrees to conduct an annual review of the Employee
with respect to compensation, bonuses and benefits by comparison to other
executive employees of Xxxxxxx and its affiliated companies.
5. EXPENSES. Employee may incur reasonable expenses for promoting the
Company's business, including expenses for entertainment, travel and similar
items in accordance with Company policy, procedures and directives. The Company
will reimburse Employee for all such expense upon Employee's prompt presentation
(not less frequently than monthly) of an itemized account of such expenditures.
6. BENEFITS. The Company shall at its expense provide the following
benefits to Employee:
(a) Key Man Insurance. The Company may apply for and procure as
owner and for its own benefit insurance on Employee's life, in any
amount and form or forms that the Company may choose. Employee shall
have no interest in any such policy or policies. Employee shall,
however, at the Company's request, submit to all medical examinations,
shall all information and execute all documents that are required by
the insurance company or companies to whom the Company has applied.
(b) Medical and Dental Benefits. The Company agrees to provide to
Employee and his family hospital, surgical and medical and dental
benefits commensurate with the Company's flexible benefits plan for all
executives.
(c) Vacation and Other Benefits. Employee shall be entitled to
three (3) weeks of vacation time each year.
(d) Disability Insurance. If the Employee can qualify for
disability insurance, the Company shall at its expense maintain
disability insurance equal to 50 percent of Employee's base salary.
(e) Automobile Allowance. Employee shall be paid an automobile
expense allowance of $500.00 per month.
(f) Other Benefits. Employee shall also receive such other
benefits as other executive level employees of Xxxxxxx or its
affiliates commonly receive.
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7. CONFIDENTIALITY.
(a) Employee acknowledges and agrees during his employment with
the Company and at any time subsequent thereto that all Confidential
Materials and Information are and shall remain the sole and exclusive
property of the Company, and Employee acknowledges that he has no
rights thereto or interest therein. For purposes of this Agreement the
term "Confidential Materials and Information" shall mean (I) all
confidential or secret processes, plans, formulae, data (including cost
and performance data), inventions, machinery, drawings, papers,
writings, specifications, manufacturing procedures and techniques,
methods, technology, know-how, programs, devices and materials relating
to the business, products (either existing or under development),
services or activities of the Company or its affiliates, regardless of
whether or not any or all of the foregoing are or may be patented or
copyrighted, (ii) any other information or aspect of or related to the
Company's or its affiliates' trade, business, products or activities
which are designated or treated by the Company or its affiliates as
confidential, secret or of a proprietary nature, or (iii) any customer
or supplier usages and requirements and any of the Company's or its
affiliates' lists of clients, customers, suppliers and business
contacts.
(b) Except as required by law or in the course of Employees'
employment with the Company, Employee agrees that he shall not, during
his employment with the Company or at any time subsequent thereto,
directly or indirectly, copy or reproduce, cause to be copied or
reproduced, divulge, use, furnish, disclose or otherwise make known or
accessible to anyone other than the Company's officers, directors,
employees, affiliates, associates, agents and representatives who have
a need to know in order to fulfill their respective responsibilities on
behalf of the Company, any of the Confidential Materials and
Information or any knowledge or information with respect to the
Confidential Materials and information.
8. NON-COMPETITION AND NON-INTERVENTION
(a) Employee agrees that while Employee is employed by the
Company, Employee shall not, directly or indirectly, as an individual
proprietor, partner, stockholder, agent, consultant, advisor, director,
officer, joint venturer or investor, or in any other capacity
whatsoever, engage in or in any manner be employed by or associated
with any person company, association, partnership, trust, corporation
business or other entity engaged in any business or enterprise (whether
or not for profit) which competes with the business of the Company or
its affiliates.
(b) Employee further agrees that while he is employed by the
Company and for six (6) months thereafter if Employee terminates his
employment without "Good Reason" (as herein defined) or if Employer
terminates his employment for other than "For Cause" (as herein
defined), Employee shall not, directly or indirectly, whether alone or
by
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any act in concert with others, employ, attempt to employ, recruit or
otherwise solicit or induce or influence to leave his employment any
employee of the company or its affiliates for any purpose which,
directly or indirectly, would serve to compete with the Company or its
affiliates; furthermore, Employee will not induce any client, customer,
supplier, vendor or agent of the Company or its affiliates to leave or
cease doing business with the company or its affiliates or otherwise
interfere with or hinder the operations of the Company or its
affiliates while he is employed by the Company.
9. TERMINATION.
(a) Termination Prior to Expiration of Employment Term.
Employment pursuant to this Agreement may be terminated by the
Company, and Employee discharged, prior to the expiration of his term
set forth herein only by a majority vote of the Board of Directors of
the Company. Employee may terminate this Agreement at any time upon
sixty (60) days written notice.
(b) Termination by the Company For Cause. The Company may at its
option terminate Employee's employment for cause ("For Cause") pursuant
to this Agreement by giving written notice of termination to Employee
without prejudice to any other remedy to which the Company may be
entitled either at law, in equity or under this Agreement. Termination
shall be For Cause if Employee: (i) willfully breaches or habitually
neglects the duties that Employee is required to perform under the
terms of this Agreement; (ii) willfully violates reasonable and
substantial rules governing employee performance; (iii) fails to comply
with lawful directives of the Board of Directors or any superior of the
Company which directives are consistent with the material provisions of
this Agreement; (iv) fails to use his best efforts to preserve and
enhance the Company's business; (v) commits clearly dishonest acts
toward the Company; (vi) is convicted of a felony with all appeals
periods with respect to such conviction having expired or with any
final appeals having been pursued unsuccessfully to conclusion; or
(vii) engages in any pattern of prolonged absence from work without
satisfactory explanation or reason therefor.
(c) Termination on Other Extraordinary Grounds. This Agreement
shall terminate immediately on the occurrence of any one of the
following events: (i) the occurrence of circumstances that make it
impossible or impracticable for the business of the Company to be
continued; (ii) the death of Employee; (iii) the loss by Employee of
legal capacity; or (iv) the continued incapacity on the part of
Employee to substantially perform his duties for a continuous period of
180 days, unless waived by the Company.
(d) Effect of Termination. In the event of the termination of
employment pursuant to this Agreement prior to the completion of the
term of employment specified herein, for any reason, Employee shall be
entitled to the compensation and benefits earned prior to the date of
termination as provided for in this Agreement, computed pro rata up to
and including the date of termination. Except as otherwise stated
herein, Employee shall be entitled to no further compensation and will
be relieved of all duties
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and obligations under this Agreement at the date of termination except
as provided in Paragraphs 7 and 8 above.
(e) Termination by Employee for Good Reason. Employee shall have
the right to terminate the Agreement for "Good Reason" which shall
include: (i) the Company's failure in any material respect to perform
any provision of the Agreement, which failure is not cured within
thirty (30) days of written notice specifying the failure; (ii) any
material reduction in the duties and responsibilities of Employee under
the Agreement; provided, however, that any two (2) of the three (3)
duties listed in Section 3 may be reduced or eliminated by the Company
without Employee's consent; (iii) the transfer of Employee to
employment by any subsidiary or affiliate of the Company which is not a
successor to the business operations of the Company unless agreed to in
writing by Employee; (iv) the failure of Employee to be elected or
appointed to a senior management position within both PIC and PICR; (v)
the relocation of Employee's workplace from the Austin, Texas
metropolitan area; (vi) the failure by an entity that is the survivor
in a merger with the Company, or that acquires substantially all of the
assets of the Company to assume the obligations under the Agreement;
(vii) the action of the Company in giving Employee notice of intent not
to renew the Agreement under Section 1 hereof; or (viii) after six (6)
months following a change of control to an entity other than Xxxxxxx or
any affiliate of Xxxxxxx and for a period of thirty (30) days
thereafter, Employee's termination of this Agreement.
10. LIQUIDATED DAMAGES. In the event that the Company (or either of
them) shall terminate this Agreement other than For Cause or that Employee shall
terminate this Agreement for Good Reason, then the Company shall be liable to
Employee for liquidated damages in an amount equal to the total of the base
salary to which Employee would have been entitled during the greater of (a) the
remainder of the term of the employment under this Agreement or (b) one (1)
year.
11. SEVERANCE PAY. Notwithstanding the foregoing, if the Company
terminates this Agreement for any of the reasons stated in Section 9(c) hereof,
then Employee shall be entitled to receive, as his sole remedy severance pay in
the amount of twelve (12) months base salary existing at the time of such
termination.
12. REMEDY FOR BREACH BY EMPLOYEE. Both parties recognize that the
services to be performed by Employee are special and unique,. Accordingly, if
Employee breaches the terms and conditions of this Agreement, or shall threaten
a breach of any such terms and conditions, then the Company shall be entitled to
institute legal and equitable proceedings in any court of competent jurisdiction
and to obtain injunctive relief for a violation of Section 7 or 8 hereof,
without the necessity of posting a bond, to protect itself from such breach and
the Company shall be entitled to recover any and all costs and expenses,
including reasonable counsel fees in enforcing this Agreement and the provisions
of this Paragraph against Employee.
13. INDEMNITY. To the fullest extent permitted by law, the Company
shall indemnify Employee and hold him harmless for all acts or decisions made by
him in good faith and in a
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manner a prudent person would believe to be in the best interest of the Company
while performing services for the Company.
14. SEVERABILITY. The Company and Employee hereby recognize and agree
that because any breach of the provisions of this Agreement by Employee would
result in irreparable harm and damage to the overall reputation of the Company
and to its business and affairs, the restrictions set forth in this Agreement by
which Employee has agreed to be bound, are reasonable, both as to the covenants
of and the duties and restrictions accepted by Employee herein, including in
terms of extent, time and geographic area. Therefore, whenever possible,
Employee and the Company desire that each provision of this Agreement be
interpreted in such a manner as to be effective, valid and enforceable under
applicable law. However, if any of the covenants, duties or restrictions which
Employee has accepted hereunder, or any other provisions of this Agreement would
be deemed to be unreasonable (such as because any or all of them may be too
broad) so that they would be unenforceable or invalid under such applicable law,
then such paragraph, provision, covenant, duty or restriction shall be reformed
in order to conform with such applicable law so that it shall bind Employee and
the Company; such reformation to be which such provision shall be invalid or
unenforceable, and the remainder of such covenant, duty, restriction, provision
or paragraph shall continue to be binding and in full force and effect.
15. NOTICES. Any notice, payment, request, instruction or other
document to be delivered under this Agreement shall be deemed sufficiently given
if in writing and delivered personally mailed by certified mail, postage
prepaid, to Employee at its address listed above and to the Company at the
address listed above or to any changed address that the parties may designate by
like notice. The effective date of such notice shall be its mailing date.
16. GUARANTY. By its signature hereto, Xxxxxxx does hereby fully
guarantee to Employee the performance by the Company of the obligations to
Employee arising under this Agreement as if Xxxxxxx were a party to this
Agreement and agrees to be jointly and severally liable with PIC and PICR for
such obligations.
17. MISCELLANEOUS.
(a) Entire Agreement. This Agreement represents the entire
understanding of the parties with respect to its subject matter and
supersedes all prior agreements, written or oral, concerning the
subject matter hereof and may not be changed or modified in any regard
except by an instrument in writing and signed by a duly authorized
officer of the Company and by Employee. No inferences shall be drawn
from any variance between this Agreement and any prior written
negotiations or letters of intent with respect to or drafts of this
Agreement.
(b) Binding Effect. All terms and provisions of this Agreement
shall be binding upon and inure to the benefit of and be enforceable by
the Company, and its successors, assigns and legal representatives. The
rights and benefits of the Company under this Agreement shall be
transferable and assignable to any business entity with which the
Company may merge or to which it may transfer all or a substantial part
of its
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assets, and all the covenants and agreements hereunder shall ensure to
the benefit of and be enforceable by the successors and assigns of any
such transferee or assignee. The obligations of Employee shall be
binding upon his heirs, executors, administrators and legal
representatives.
(c) Counterparts. This Agreement may be executed in one or more
counterparts, each one of which shall be deemed to be an original, but
all of which together shall constitute one and the same instrument.
(d) Non-Waiver. No delay or omission by the Company in enforcing
any of the terms or conditions of this Agreement shall be construed as
or constitute a waiver thereof or bar thereto, and no waiver of any
breach hereunder shall be construed as or constitute a waiver of any
other or subsequent breach or a bar to the enforcement of such terms or
conditions on any future occasion.
(e) Construction. This Agreement shall be deemed to be made under
the laws of the State of Texas, for all purposes shall be governed by,
enforced under and construed in accordance with the laws of said State,
without regard to principles of conflicts of law, and shall be deemed
performable in Austin,Texas.
(f) Headings. Headings in this Agreement are for convenience of
reference only and shall not be used to interpret or construe its
provisions.
IN WITNESS WHEREOF, the Company and Employee have caused this Agreement
to be executed to take effect as an instrument under seal as of the day and year
first above written.
COMPANY:
PRIORITY INTERNATIONAL
COMMUNICATIONS, INC.
By: /s/ Xxxxxx X. Xxxxxxx
January 28, 1999 Name: Xxxxxx X. Xxxxxxx
----------------------------- Title: Chairman
DATE
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PIC RESOURCES CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
January 28, 1999 Name: Xxxxxx X. Xxxxxxx
----------------------------- Title: Chairman
DATE
EMPLOYEE:
January 28, 1999 /s/ Xxxxxx X. Xxxxxxxxx
----------------------------- XXXXXX X. XXXXXXXXX
DATE
GUARANTOR:
XXXXXXX COMMUNICATIONS
CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
January 28, 1999 Name: Xxxxxx X. Xxxxxxx
----------------------------- Title: Chief Executive Officer
DATE
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