EXHIBIT 10.3
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made and entered into as of the 12th day
of June, 1998, by and between Nu-Wave Health Products, Inc., a Florida
corporation (the "Employer") and Xxxx Xxxxxxxxxx, residing at 0000 Xxxxxx Xxxxx
Xxxx., Xxxxxxxx, XX 00000 (the "Employee").
WITNESSETH:
1. EMPLOYMENT. The Employer hereby employs the Employee as the
Vice Chairman of the Board of Directors of the Employer, and the Employee hereby
accepts such employment, upon the terms and subject to the conditions set forth
in this Agreement.
2. TERM. Subject to the provisions of termination as hereinafter
provided, the term of employment under this Agreement shall begin as of June 12,
1998, and terminate on June 13, 2001.
3. COMPENSATION; REIMBURSEMENT, ETC.
(a) The compensation payable to the Employee shall be
fixed at an annual salary of $125,000. Such compensation may be paid in weekly
or in other convenient installments, as determined by the Employer. In addition,
the Board of Directors of Employer may, in its discretion, establish a bonus
plan which may include the Employee. The terms of any such bonus plan shall be
in the discretion of the Employer.
(b) The Employer shall reimburse the Employee on a
monthly basis for all reasonable expenses incurred by the Employee in the
performance of his duties under this Agreement; provided, however, that the
Employer will not reimburse the Employee for any expense which had not been
approved by the Employer prior to such expense; and provided further, that the
Employee shall have previously furnished to the Employer an itemized account,
satisfactory to the Employer, in substantiation of such expenditures.
(c) The Employer currently provides to the Employee a
leased automobile, with 15 months remaining on such lease. The Employer shall
maintain such lease until its expiration, at which time such vehicle shall be
returned to the lessor. Thereafter, Employer shall pay to Employee an automobile
allowance of $750 per month for each month during the term hereof.
(d) The Employer shall maintain a life insurance policy
on the life of the Employee during the term of this Agreement in the face amount
of $500,000. The Employee, his designee or estate shall be the beneficiary of
$250,000 of the death benefit of such life insurance policy and, until the date
that the Employer refinances its existing note and mortgage encumbering its
facilities (the "Note"), $250,000 of the death benefit shall be payable to the
Employer, but pledged as additional security for the Note. After the Note is
refinanced, the death benefit previously pledged as additional security for the
Note shall be payable to the Employee's designated beneficiary.
4. DUTIES. The Employee is engaged as the Vice Chairman of the
Board of the Employer. Employee shall report to and take direction from
Employer's Chairman of the Board. Employee's primary responsibility shall be
business development and acquisitions. The Employee shall adhere to the minimum
performance standards set forth in Exhibit "A" hereto. In addition, the Employee
shall have such other duties and hold such offices as may from time to time be
reasonably assigned to him by the Board of Directors of the Employer.
5. EXTENT- OF SERVICES. During the term of his employment under
this Agreement, the Employee shall devote his entire time, attention, energies
and skill to the benefit and business of the Employer, and shall not during the
term of this Agreement be employed by any other person without board approval.
6. BENEFITS. The Employee shall be entitled to the same benefits
package made available by the Employer to its management personnel, including
health insurance for employee and his immediate family. The Employee shall be
entitled to four (4) weeks vacation time during each fiscal year of the
Employer.
7. DISABILITY, ILLNESS OR INCAPACITY.
(a) The Employee shall receive full compensation for any
period of disability, illness or incapacity during the term hereof which renders
the Employee at least temporarily unable to perform the services required under
this Agreement, provided, however, that if the Employee's disability, illness or
incapacity extends beyond a period of one hundred twenty (120) days, the
Employee shall not be entitled, after the expiration of such one hundred twenty
(120) day period, to any further compensation hereunder until he returns to full
time service hereunder, but he shall be entitled only to such disability
payments as may be provided by a disability insurance policy or policies
purchased by the Employer.
(b) Successive periods of disability, illness or
incapacity will be considered separate periods unless the later period of
disability, illness or incapacity is due to the same or related cause and
commences less than six (6) months after the ending of the previous period of
disability.
(c) If and when the period of disability, illness or
incapacity of the Employee totals six (6) months, his employment with the
Employer may be terminated by the Board. If the Employee and the Employer agree,
the Employee may thereafter be employed by the Employer upon such terms as may
be mutually agreeable.
(d) Any dispute regarding the existence, extent or
continuance of the disability, illness or incapacity shall be resolved by the
determination of a majority of three competent doctors who are not employees of
the Employer, one of which shall be selected by the Employer, one of which shall
be selected by the Employee and a third selected by the other two doctors.
8. DEATH OR RETIREMENT.
(a) All rights of the Employee hereunder (other than
rights accrued prior thereto) shall terminate upon his death, except that the
Employer shall pay to the estate of the
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Employee such compensation as would otherwise have been payable to the Employee
up to six months after the death occurs. The Employer shall. have no additional
financial obligation under this Agreement to the Employee or his estate.
(b) All rights of the Employee hereunder (other than
rights accrued prior thereto) shall terminate upon his retirement, except that
the Employer shall pay to the Employee such compensation as would otherwise have
been payable to the Employee up to the end of the month in which his retirement
occurs. The Employer shall have no additional financial obligation under this
Agreement to the Employee.
9. OTHER TERMINATIONS.
(a) (i) The Employer may terminate the employment of the
Employee hereunder without notice (1) upon the Employee's breach of any
provision of this Agreement, or (2) for good cause (as defined below).
(ii) The term "good cause" as used in this
Agreement shall include, but shall not necessarily be limited to fraud, habitual
absenteeism, a pattern of conduct which tends to hold the Employer up to
ridicule in the community, conduct disloyal to the Employer, conviction of any
crime of moral turpitude and substantial dependence, as determined by the Board
of Directors of the Employer, on any addictive substance, including but not
limited to alcohol, amphetamines, barbiturates, methadone, cannabis, cocaine,
PCP, THC, LSD or other illegal or narcotic drugs. If any determination of
substantial dependence by the Board of Directors is disputed by the Employee,
the parties hereto agree to abide by the decision of a panel of three physicians
selected in the manner provided in Section 7(d) of this Agreement. The Employee
agrees to make himself available for and submit to examinations by such
physicians as may be directed by the Employer. Failure to submit to any such
examination shall constitute a breach of a material part of this Agreement.
(b) If the employment of the Employee is terminated
pursuant to this Section 9, the Employer shall pay to the Employee any
compensation earned but not paid to the Employee prior to such termination. Such
payment shall be in full and complete discharge of any and all liabilities or
obligations of the Employer to the Employee hereunder, and the Employee shall be
entitled to no further benefits under this Agreement, except as provided in
Section 9 of this Agreement.
(c) In the event termination for reasons other than those
pursuant to this Section 9 the Employer will pay the balance of compensation due
pursuant to that contact, less any bonus, up to the termination date of this
contract.
10. DISCLOSURE.
(a) The Employee agrees that he will fully disclose and
disclose only to the Employer all ideas, methods, plans, developments,
improvements or patentable inventions, of any kind, which relate directly or
indirectly to the business of the Employer and which are known, made or
discovered by him during the performance of his duties under this Agreement. All
disclosures are to be made promptly after conception or discovery of the idea,
method, plan,
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development, improvement or invention. Nothing in this Section 10 shall be
construed as requiring any communication to the Employer of the idea, method,
plan, development, improvement or invention if lawfully protected by any other
lawful prohibition against such communication.
(b) Any idea, method, plan, development, improvement or
invention which the Employee is obligated to disclose to the Employer under this
Section 10 shall be the property of the Employer, regardless of whether it is
disclosed by the Employee to the Employer. The Employee agrees that he will
provide any and all assistance to the Employer in making any patent applications
or other applications for obtaining exclusive rights in, and will do all other
things that may be reasonably necessary to vest in the Employer or its assigns,
the ideas, methods, plans, developments, improvements or inventions.
11. CONFIDENTIALITY. The Employee agrees to keep in strict secrecy
and confidence any and all information the Employee assimilates or to which he
has access during his employment by the Employer and which has not been publicly
disclosed and is not a matter of common knowledge in the fields of work of the
Employer. The Employee agrees that both during and after the term of his
employment by the Employer, lie will not, without prior written consent of the
Employer, disclose any such confidential information to any third person,
partnership, joint venture, company, corporation or other organization.
12. NONCOMPETITION AND NONSOLICITATION.
(a) During the term of this Agreement, except as
contemplated herein, and for a period of three (3) years after the termination
of his employment with the Employer, regardless of the reason for such
termination, the Employee shall not, directly or indirectly, within Florida,
enter into, engage in, be employed by, or consult with any business in
competition with the business of the Employer or Nu-Wave Health Products, Inc.,
a Florida corporation ("Nu-Wave") as it is then carried on (except for vitamin
outlets); further, the Employee shall not sell to, market, produce or otherwise
deal with any customer of the Employer or Nu-Wave. The restrictions of this
Section 12 shall extend to any and all activities of the Employee, whether as an
independent contractor, partner or joint venturer, or as an officer, director,
stockholder, agent, employee or salesman for any person, firm, partnership,
corporation or other entity, or otherwise. The restrictions of this Section 12
shall not be violated by the ownership of no more than 2% of the outstanding
securities of any company whose stock is traded on a national securities
exchange or is quoted in the Automated Quotation System of the National
Association of Securities Dealers (NASDAQ). Solicitation or acceptance of orders
outside of any prohibited territory as described above for shipment to, delivery
in or service in any restricted territory shall also constitute engaging in
business within the restricted territories in violation of this Section 12.
(b) During his employment with the Employer, except as
contemplated herein, and for a period of one (1) year after the termination of
his employment with the Employer, regardless of the reason for such termination,
the Employee agrees he will refrain from and will not, directly or indirectly,
as independent contractor, employee, consultant, agent, partner, joint venturer,
or otherwise, (1) solicit any of the employees of the Employer or Nu-Wave to
terminate their employment or (2) accept employment with or seek remuneration by
any of the customers
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of the Employer or Nu-Wave with whom the Employer or Nu-Wave did business during
the term of the Employee's employment.
(c) The period of time during which the Employee is
prohibited from engaging in certain business practices pursuant to Sections
12(a) or (b) shall be extended by any length of time during which the Employee
is in breach of such covenants.
(d) It is understood by and between the parties hereto
that the foregoing restrictive covenants set forth in Sections 12(a) through (c)
are essential elements of this Agreement, and that, but for the agreement of the
Employee to comply with such covenants, the Employer would not have agreed to
enter into this Agreement. Such covenants by the Employee shall be construed as
agreements independent of any other provision in this Agreement. The existence
of any claim or cause of action of the Employee against the Employer, whether
predicated on this Agreement, or otherwise, shall not constitute a defense to
the enforcement by the Employer of such covenants.
(e) It is agreed by the Employer and the Employee that if
any portion of the covenants set forth in this Section 12 are held to be
invalid, unreasonable, arbitrary or against public policy, then such portion of
such covenants shall be considered divisible both as to time and geographical
area. The Employer and Employee agree that, if any court of competent
jurisdiction determines the specified time period or the specified geographical
area applicable to this Section 12 to be invalid, unreasonable, arbitrary or
against public policy, a lesser time period or geographical area which is
determined to be reasonable, nonarbitrary and not against public policy may be
enforced against the Employee. The Employer and the Employee agree that the
foregoing covenants are appropriate and reasonable when considered in light of
the nature and extent of the business conducted by the Employer.
13. SPECIFIC PERFORMANCE. The Employee agrees that damages at law
will be an insufficient remedy to the Employer if the Employee violates the
terms of Sections 10, 11 or 12 of this Agreement and that the Employer would
suffer irreparable damage as a result of such violation. Accordingly, it is
agreed that the Employer shall be entitled, upon application to a court of
competent jurisdiction, to obtain injunctive relief to enforce the provisions of
such Sections, which injunctive relief shall be in addition to any other rights
or remedies available to the Employer. The Employee agrees to pay to the
Employer all costs and expenses incurred by the Employer relating to the
enforcement of the terms of Sections 10, 11 or 12 of this Agreement, including
reasonable fees and disbursements of counsel (both at trial and in appellate
proceedings).
14. COMPLIANCE WITH OTHER AGREEMENTS. The Employee represents and
war-rants that the execution of this Agreement by him and his performance of his
obligations hereunder will not conflict with, result in the breach of any
provisions of or the termination of or constitute a default under any Agreement
to which the Employee is a party or by which the Employee is or may be bound.
15. WAIVER OR BREACH. The waiver by the Employer of a breach of
any of the provisions of this Agreement by the Employee shall not be construed
as a waiver of any subsequent breach by the Employee.
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16. BINDING EFFECT ASSIGNMENT. The rights and obligations of the
Employer under this Agreement shall inure to the benefit of and shall be binding
upon the successors and assigns of the Employer. This Agreement is a personal
employment contract and the rights, obligations and interests of the Employee
hereunder may not be sold, assigned, transferred, pledged or hypothecated.
17. ENTIRE AGREEMENT. This Agreement contains the entire agreement
and supersedes all prior agreements and understandings, oral or written, with
respect to the subject matter hereof. This Agreement may be changed only by an
agreement in writing signed by the party against whom any waiver, change,
amendment, modification or discharge is sought.
18. HEADINGS. The headings contained in this Agreement are for
reference purposes and shall not affect the meaning or interpretation of this
Agreement.
19. GOVERNING LAW. This Agreement shall be construed and enforced
in accordance with the laws of the State of Florida. 20. NOTICES. Any notice
required or permitted to be given under this Agreement shall Sufficient if in
writing and if sent by certified or registered mail, first class, return receipt
requested, to the parties at the following addresses:
To the Employer: Nu-Wave Health Products, Inc.
c/o Nu-Wave Health Products, Inc.
0000 Xxxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Kotha X. Xxxxxxxx, President
To the Employee at his address herein first above written.
The parties hereto have executed this Agreement the day and year first
above written.
EMPLOYER:
NU-WAVE HEALTH PRODUCTS, INC.
By: /s/ KOTHA X. XXXXXXXX
-------------------------------------
Kotha X. Xxxxxxxx, President
EMPLOYEE:
/s/ XXXX XXXXXXXXXX
-------------------------------------
Xxxx Xxxxxxxxxx
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