EXHIBIT 6(ii)
Xxxx Xxxxxxxxxx Employment Agreement
Employment Agreement
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (THE "Agreement"), dated as of the 10th day of
November, 1998, is between Dreams, Inc., a Utah corporation (the "Company") and
Xxxx Xxxxxxxxxx (the "Employee").
In consideration of the foregoing and the mutual promises and covenants
set forth herein, Company and Employee agree:
1. EMPLOYMENT.
1.1 EMPLOYMENT AND TERM. The company hereby employs the
Employee, and Employee shall serve the company, upon the terms and
conditions herein set forth, for a term commencing on the date of this
Agreement and expiring on the last day of the 60th calendar month
following the date first written above (the "Term of Employment"), unless
earlier terminated pursuant to Section 4 below.
1.2 POSITION AND DUTIES. The Employee is engaged as Vice-
President to exercise and faithfully perform to the best of his
ability on behalf of Company such duties as shall be determined by
the Board of Directors of the Company, and as same may be modified
from time to time.
1.3 OTHER ACTIVITIES. Nothing in this Agreement shall be
construed to prevent Employee from devoting a portion of his time to
community or charitable activities, from investing his assets in any form
or manner he deems appropriate or from serving as a director of any
corporation, provided such activities do not unreasonably interfere with
the performance of duties under this Agreement and do not violate the
provisions of Section 3.1.
2. COMPENSATION.
2.1 BASE SALARY. Company shall pay Employee Two Hundred Fifty
Thousand and No/100 Dollars ($250,000) per calendar year, payable semi-
monthly, subject, however, to the "EBITA" (as hereinafter defined)
adjustment. Notwithstanding the foregoing, commencing as of April 1,
2000, and on April 1st of each and every calendar year thereafter during
the Term of Employment, in the event that the Company's EBITA for the
immediately preceding fiscal year is: (a) less than One Million Two
Hundred Thousand and No/100 Dollars ($1,200,000.00), then for the fiscal
year then in question (commencing April 1, 2000 through March 31, 2001),
the base salary shall be Two Hundred Thousand and No/100 Dollars
($200,000.00), payable semi-monthly; or (b) equal to or greater than One
Million Two Hundred Thousand and No/100 Dollars ($1,200,000.00), then for
the fiscal year then in question (commencing April 1, 2000 through March
31, 2001), the base salary shall
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be Two Hundred Fifty Thousand and No/100 Dollars ($250,000.00),
payable semi-monthly. For purposes of this Agreement, the term
"EBITA" shall mean net income plus interest expense, plus income tax,
plus depreciation expenses, plus amortization expenses, all
determined in accordance with generally accepted accounting
principles, all as set forth in the Company's audited financial
statements.
2.2 HEALTH INSURANCE. The Company shall provide health,
medical and dental care insurance coverage for Employee and his
dependents in amounts and coverage equivalent to the greater of the
amount and coverage previously provided to Employee by his previous
employer, Mounted Memories, Inc., or the insurance benefits and coverage
provided by the Company in its health insurance coverage provided for
other Company officers.
2.3 AUTOMOBILE ALLOWANCE. Company shall reimburse Employee or
otherwise provide Employee an automobile allowance in the amount of Eight
Hundred and No/100 dollars ($800.00) per month and a reimbursement for
all insurance, fuel, maintenance, cellular and mobile telephones, repairs
and upkeep therefor. The automobile allowance shall increase effective
immediately preceding the adjustment then in question by a ratio of the
"Index" (as hereinafter defined) for the month of November preceding the
year of the date of adjustment then in question divided by the Index for
the month of November of 1997. The "Index" shall mean the index numbers
of retail commodity prices designated "Revised Consumer Price Index for
all Urban Consumers - U.S. City Average - All Items (1982-1984=100)
Prepared by the Bureau of Labor Statistics of the United States
Department of Labor". In the event such Index is not published, then an
index most comparable to the commodity index published shall be utilized.
2.4 DISABILITY AND LIFE INSURANCE.
(a) Company shall pay for or reimburse Employee the cost
of a disability insurance policy which shall provide the highest
rate of compensation then available, but in no event less than Two
Hundred Thousand and No/100 Dollars ($200,000.00) per year, a
ninety (90) day waiting period, and benefits payable through the
age of seventy-five (75).
(b) Company shall pay for or reimburse Employee for a
life insurance policy which will provide a death benefit in the
amount of Two Million and No/100 Dollars ($2,000,000.00), which
shall contain a cost of living adjustment endorsement for each
calendar year during the term of this Agreement.
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(c) Provided, however, that the total annual cost of
such disability and life insurance coverage for Employee to be
paid by the Company shall not exceed Two Thousand Dollars ($2,000)
per year. Any cost of such insurance in excess of $2,000 per year
shall be paid by Employee.
2.5 DIRECTORS' AND OFFICERS' INSURANCE. At such time as it
becomes available and economically feasible, Company will maintain
director's and officers' insurance in sufficient amounts to insure
against the personal liability of the Employee as a director of the
Company for certain losses resulting from claims brought against
directors and officers because of their alleged wrongful acts.
2.6 VACATION. The Employee shall be entitled to a four (4)
week vacation each calendar year during the term of this Agreement.
2.7 BENEFITS. In addition to the other provisions of Section 2
set forth above, Company shall provide to Employee all other standard
benefits and perquisites as are provided for other Company officers,
directors and employees.
2.8 WITHHOLDING. Employee agrees that the Company shall deduct
and withhold from his salary and from all other amounts paid to Employee,
all state and federal tax and other withholdings.
2.9 EXPENSES. Employee is authorized to incur reasonable
expenses for the business of company which are necessary for the
promotion of Company's business and similar expenses that assist Employee
in the performance of his duties hereunder.
2.10 TERMINATION. Without in any way limiting the other
provisions of this Agreement, upon termination of Employee's employment,
whether by expiration of the term of this Agreement or as provided for in
Section 4, Employee shall cease to receive or have any right to receive
salary or any other compensation provided for above or otherwise,
provided, however, that nay previously earned compensation shall be paid
by Company to Employee in accordance with the terms and provisions of
this Agreement.
3. DISCLOSURE OF INFORMATION.
3.1 DISCLOSURE OF INFORMATION. The Employee recognizes and
acknowledges that the confidential, proprietary information of the
Company, and other intellectual property of this Company including
contacts made prior to the commencement of this Agreement and those made
within the scope of Employee's duties hereunder and such trade secrets or
information as may exist from time to time, including without limitation,
technical
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information regarding the Company's business, information as to the
identity of employees, customers and potential or existing suppliers
of the Company or its affiliates, information as to the marketing or
other plans of the Company and other similar items, are valuable,
special and unique assets of the Company's business, access to and
knowledge of which are essential to the performance of the duties of
Employee hereunder. Such property and information shall remain the
exclusive property of the Company at all times during and subsequent
to the Term of Employment. Employee will not, during or after the
Term of Employment, in whole or in part, remove Company's records
either in original, duplicated or copied form, from the premises of
the Company, nor disclose such secrets or confidential or proprietary
information to any person, firm, corporation, association or other
entity (except the Company or its affiliates) under any
circumstances, during or after the Term of Employment.
3.2 INJUNCTIVE RELIEF. If there is a breach or threatened
breach of the provisions of Section 3.1 of this Agreement by Employee,
the Company shall be entitled to an injunction restraining the Employee
from breaching or violating the provisions of this Section 3, it being
agreed that the loss and damages suffered by virtue of any breach are
incapable of being made certain.
3.3 EVENTS OF DEFAULT BY COMPANY. In the event of a breach or
default by the Company hereunder, which results in Employee not receiving
base salary (as set forth in Paragraph 2.1 above), for any reason and for
a period of ninety (90) consecutive days, which reasons include, but are
not limited to, the failure of the Company to pay to Employee the base
salary while Employee remains in the employ of the Company or Employee
ceases to be employed by the Company directly as a result of such breach
or default by the Company, then the provisions of this Section 3 shall be
void and of no further force or effect.
4. EARLY TERMINATION OF AGREEMENT.
4.1 EARLY TERMINATION OF AGREEMENT. This Agreement shall
terminate earlier than expiration of the Term of Employment ("Early
Termination") upon the occurrence of any of the following events:
(a) Immediately upon notice from the Company to the
Employee for cause. The term "cause" shall refer and be limited
to: (i) any act of embezzlement or conversion of assets of the
Company; (ii) the employee's breach of any material covenant of
this Agreement; (iii) habitual or repeated non-performance of
material duties. However, with regard to (ii) and (iii) above,
"cause" shall not have occurred until Company notifies Employee of
such event, in writing, and Employee shall not have cured such
event within a period of fifteen (15) days after receipt of such
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written notice, provided however, in the event such cure cannot be
reasonably completed within said fifteen (15) day period, Employee
shall have the right to commence to cure such event and diligently
pursue such cure to completion.
(b) Upon mutual agreement of Company and Employee.
4.2 OBLIGATIONS SURVIVING EARLY TERMINATION. Notwithstanding
the Early Termination of this Agreement as contemplated in Section 4.1
above or expiration of the term if this Agreement, the provisions of this
Agreement relating to the Employee's covenant not to compete, and
Employee's obligation to maintain and protect trade secrets and
confidential, proprietary rights and information of the Company shall
maintain in force and effect pursuant to the terms of this Agreement.
5. GENERAL PROVISIONS.
(a) BINDING AGREEMENT. This Agreement shall be binding upon and
shall inure to the benefit of the heirs, legal representatives,
successors and assigns, as applicable, of the respective parties hereto,
and any entities resulting from the reorganization, consolidation or
merger of any party hereto.
(b) HEADINGS. The headings used in this Agreement are inserted
for reference purposes only and shall not be deemed to limit or affect in
any way the meaning or interpretation of any of the terms or provisions
of this Agreement.
(c) COUNTERPARTS. This Agreement may be signed upon any number
of counterparts with the same effect as if the signature to any
counterpart were upon the same instrument.
(d) SEVERABILITY. The provisions of this Agreement are
severable, and should any provision hereof be found to be void, voidable
or unenforceable, such void, voidable or unenforceable provision shall
not affect any other portion or provision of this Agreement. without
limiting the generality of the above, should any provision be
unenforceable as a result of a time period or geographic area, the time
period and/or geographic area shall be reduced to the longest period
and/or largest area which would render the provision enforceable.
(e) WAIVER. Any waiver by any party hereto of any breach of any
kind or character whatsoever by any other party, whether such waiver be
direct or implied, shall not be construed as a continuing waiver or
consent to any subsequent breach of this Agreement on the part of the
other party.
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(f) MODIFICATION. This Agreement may not be modified except by
an instrument in writing signed by the parties hereto.
(g) GOVERNING LAW. This Agreement shall be interpreted,
construed and enforced according to the laws of the State of Florida.
Venue with respect to any litigation regarding this Agreement shall only
be permitted in the Seventeenth Judicial Circuit in and for Broward
County, Florida.
(h) ATTORNEYS' FEES. In the event any action or proceeding is
brought by either party against the other under this Agreement, the
prevailing party shall be entitled to recover reasonable attorneys' fees
and costs through all trial and appellate levels.
(i) NOTICE. Any notice, consent, request, objection or
communication to be given by either party to this Agreement shall be in
writing and shall be either delivered personally or by Airborne, Federal
Express or other commercial overnight delivery service addressed as
follows:
Company: Dreams, Inc.
00000 Xxxxxxxx Xxxxx
Xxxx Xxxxxx, XX 00000
Employee: Xxxx Xxxxxxxxxx
00000 Xxxxx Xxxxxx
Xxxxxx Xxxx, XX 00000
(j) ASSIGNMENT. Employee may not assign his rights and
obligations pursuant to this Agreement to a third party without the
written consent of the Company.
(k) SECURITIES DOCUMENTS. It shall be a condition to the
issuance of any securities by Company to Employee, including shares of
the Company's common stock, that Employee shall execute and deliver to
Company all documents deemed necessary by the Company's counsel in order
to comply with the securities laws of the United States and the states
thereof.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective as of the date first set forth above.
COMPANY:
DREAMS, INC., a Utah corporation
By:
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Its: Secretary
EMPLOYEE:
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Xxxx Xxxxxxxxxx
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