EXHIBIT 10.1
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EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT (this "Agreement") is effective as
of this 16th day of March, 2006 (the "Effective Date"), between ONLINE VACATION
CENTER HOLDINGS CORP., a Florida corporation f/k/a Xxxx Xxxxxxx Cigar
Corporation (the "Company"), whose principal place of business is in Broward
County, Florida, with its address to be determined, and XXXXXX X. XXXXXX, an
individual (the "Executive"), whose address is 0000 X.X. 00xx Xxxxxx, Xxxx
Xxxxxxxxxx, Xxxxxxx 00000. This Agreement shall become effective upon the
closing of the Share Exchange Agreement between the Company and Online Vacation
Center Holdings, Inc.
WHEREAS, the Company desires to employ the Executive as an employee of
the Company, and the Executive desires to provide services to the Company; and
WHEREAS, the Company desires to provide a plan for compensating the
Executive in relation to the degree of his success in aiding the Company's
business and affairs and recognizing the Executive's position of high trust and
confidence;
NOW, THEREFORE, in consideration of the mutual agreements herein made,
the Company and the Executive do hereby agree as follows:
1. Recitals. The above recitals are true, correct and are herein
incorporated by reference.
2. Employment. The Company hereby agrees to employ the Executive as the
Chairman of the Board of Directors and Chief Executive Officer of the Company.
The Executive hereby accepts such employment and agrees to perform pursuant to
the terms and conditions hereinafter set forth.
3. Authority and Power During Employment Period.
a. Duties and Responsibilities. During the term of this Agreement the
Executive shall serve as President and Chief Executive Officer of the Company
and shall have general executive and operating supervision over the property,
business and affairs of the Company, its subsidiaries and divisions, subject to
the guidelines and direction of the board of directors of the Company. It is
further the intention of the parties that at all times during the "Term," as
hereinafter defined, of this Agreement, the Executive shall serve as a member of
the Board of Directors of the Company and shall be elected and serve through the
Term of the Agreement as a Director of the Company. In the event Executive shall
at any time not be on the Board of Directors of the Company, it shall be
presumed (if Executive so elects) that the Executive has been Terminated Other
than for Cause, Death or Disability, as hereinafter defined, and Executive shall
be entitled to the rights specified in Section 6.d of this Agreement.
b. Time Devoted. Throughout the term of the Agreement, the Executive
shall devote a reasonable amount of the Executive's business time and attention
to the business and affairs of the Company consistent with the Executive's
senior position with the Company, except for reasonable vacations and except for
illness or incapacity, but nothing in this Agreement shall preclude the
Executive from engaging in personal business and/or serving as a member of the
board of directors of other companies, charitable and community affairs,
provided that such activities do not interfere with the regular performance of
the Executive's duties and responsibilities under this Agreement.
4. Term. The term of employment hereunder shall be for three (3) years
(the "Term") commencing on the Effective Date as set forth above and terminating
in three (3) years, unless sooner terminated under this Agreement. The Term
shall automatically renew every year, i.e. the Term shall be rolling and shall
never be in effect for less than three (3) years at any time while the Agreement
is effective.
5. Compensation and Benefits.
a. Salary. The Executive shall be paid a base salary (the "Base
Salary"), payable weekly, at an annual rate of no less than Three Hundred
Thousand Dollars ($300,000) for the first year, with annual incremental
increases of the greater of: (i) the percentage increase in the Consumer Price
Index, all items, as published by the United States Department of Labor, since
the Effective Time (in the case of the first annual increase) or since the most
recent anniversary of the Effective Time (in the case of all subsequent annual
increases), or (ii) six percent (6%) of the previous year's base salary. The
Company acknowledges and agrees that Executive is owed as of the date hereof the
sum of $579,990. This amount is a continuing obligation and is due to Executive
irrespective of any termination hereof.
b. Options. The Executive shall receive an initial grant of 500,000
stock options, of which 300,000 are fully vested on March 16, 2006, 100,000 will
vest on March 16, 2007 and the remaining 100,000 will vest on March 16, 2008.
The options shall be exercisable at a price of $1.27 per share.
c. Performance-based Bonus. Executive shall be entitled to a
performance based bonus in such amount as to be determined by the board of
directors.
d. Executive Benefits. The Executive shall be entitled to participate
in all benefit programs of the Company currently existing or hereafter made
available to executives and/or other salaried employees, as well as any other
benefit programs including pension and other retirement plans, group life
insurance, hospitalization, medical (including surgical and major medical)
insurance, health and accident insurance, director and officer insurance, sick
leave, salary continuation, stock option plans, vacation and holidays, cellular
telephone and all related costs and expenses, long-term disability, and other
fringe benefits.
e. Vacation. During each fiscal year of the Company, the Executive
shall be entitled to reasonable time and to utilize such vacation as the
Executive shall determine; provided however, that the Executive shall evidence
reasonable judgment with regard to appropriate vacation scheduling.
Notwithstanding the foregoing, Executive shall be entitled to five (5) weeks
paid vacation per year. The Executive shall be permitted to accrue vacation time
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in accordance with Company policy. Upon Termination for any reason under this
Agreement, Executive shall be fully compensated for all properly accrued and
unused weeks of vacation.
f. Business Expense Reimbursement. During the Term of employment, the
Executive shall be entitled to receive proper reimbursement for all
out-of-pocket expenses incurred by the Executive (in accordance with the
policies and procedures established by the Company for its senior executive
officers) in performing services hereunder including expenses for travel and
entertainment provided the Executive provides reasonable documentation of such
expenses.
g. Automobile Expenses. Company shall pay a monthly automobile
allowance of $1,500 to the Executive. So as to adequately protect the Company
and Executive in the event that Executive is involved in any accident, Company
agrees to maintain minimum automobile accident insurance coverage of $500,000
per accident, and $1,000,000 aggregate per year. If such insurance cannot or is
not directly obtained and paid for by Company, it shall reimburse the Executive
for all costs thereof.
h. Memberships, Dues. The Company shall provide to the Executive
memberships in social, charitable or religious organizations or clubs, which
memberships shall be either in the name of the Executive or in the name of the
Company, as determined by the Executive. Executive shall be entitled to $30,000
in reimbursements for memberships.
i. Life Insurance. Company shall provide the Executive a universal life
insurance policy with a minimum death benefit of $3,000,000. Such policy shall
be owned by the Executive, or as Executive designates, with all premiums to be
paid by Company during the term hereof. The beneficiary of such life insurance
policy shall be designated by the Executive, although nothing contained herein
shall preclude Company from obtaining any available key-man life insurance
policy, if any, that would also benefit the Company upon the Executive's death.
Such policy shall also be freely transferable to, or assumable by, Executive
upon the expiration or earlier termination of this Agreement, for any reason,
provided that Executive shall then be responsible for all future premiums due
thereon. Executive agrees to reasonably cooperate with Company in the
acquisition or retention of such policies, including the provision of all
medically necessary information, and submission to such physical examinations or
testing as may be required.
6. Consequences of Termination of Employment.
a. Termination as a Result of Death. In the event of the death of the
Executive during the Term of this Agreement, the Executive's employment shall
terminate as of the date of Executive's death. The Executive's Compensation and
Benefits as provided for in Section 5 earned up to the last day of the month of
the Executive's death shall be paid to the Executive's designated beneficiary,
or, in the absence of such designation, to the estate or other legal
representative of the Executive, and all Compensation and Benefits under Section
5 shall continue to be paid in the same manner as provided in this Section for a
period of one (1) year following Termination as a Result of Death. The Company
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shall also be obligated to pay to the Executive's estate or heirs, as the case
may be, such earned but unpaid bonuses from previous years. Except as set forth
herein, other death benefits will be determined in accordance with the terms of
the Company's benefit programs and plans. All previously held stock options,
rights and awards made to the Executive shall automatically become fully vested
as of the date of death.
b. Termination as a Result of Disability.
i. In the event of the Executive's disability, as hereinafter
defined, the Executive shall be entitled to compensation in accordance
with the Company's disability compensation practice for senior
executives, including any separate arrangement or policy covering the
Executive, but in all events the Executive shall continue to receive
the Compensation and Benefits under Section 5 of this Agreement for a
period of one (1) year subsequent to Termination as a Result of
Disability which shall be paid in the same manner as that preceding
Termination as a Result of Disability. The Company shall be obligated
to pay to the Executive all earned but unpaid bonuses from previous
years. Any amounts provided for in this Section 6.b shall not be offset
by other long-term disability benefits provided to the Executive by the
Company.
ii. "Disability," for the purposes of this Agreement, shall be
deemed to have occurred in the event (A) the Executive is unable by
reason of sickness or accident, to perform the Executive's duties under
this Agreement for an aggregate of 180 days in any twelve-month period
or (B) the Executive has a guardian of the person or estate appointed
by a court of competent jurisdiction. Termination as a result of
Disability shall be deemed to have occurred upon the first day of the
month following the determination of Disability as defined in the
preceding sentence.
Anything herein to the contrary notwithstanding, if, following a
Termination as a result of Disability as provided in the preceding paragraph,
the Executive becomes re-employed, whether as an Executive or a consultant to
the Company, any salary, annual incentive payments or other benefits earned by
the Executive from such employment shall not offset any salary continuation due
to the Executive hereunder commencing with the date of re-employment.
c. Termination by the Company for Cause.
i. Nothing herein shall prevent the Company from terminating
Employment for "Cause," as hereinafter defined. The Executive shall
continue to receive salary only for the period ending with the date of
such Termination as provided in this Section 6.c, although all earned
but unpaid bonuses from past years performance will continue to be paid
to Executive. Any rights and benefits the Executive may have in respect
of any other compensation shall be determined in accordance with the
terms of such other compensation arrangements or such plans or
programs.
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ii. "Cause" shall mean and include those actions or events
specified below in subsections (A) through (D) to the extent the same
occur, or the events constituting the same take place, subsequent to
the date of execution of this Agreement: (A) Committing or
participating in an injurious act of fraud or embezzlement against the
Company; (B) engaging in a criminal enterprise involving moral
turpitude; (C) conviction of an act or acts constituting a felony of a
crime of violence, fraud or dishonesty under the laws of the United
States or any state thereof; or (D) any assignment of this Agreement by
the Executive in violation of Section 15 of this Agreement. Anything
herein to the contrary notwithstanding, the employment of Executive
shall not be terminable by the Company for Cause if the grounds for
such termination includes (i) the result of bad judgment or poor
economic results on the part of the Executive, (ii) any act or omission
believed by Executive in good faith to have been in or not opposed to
the interests of the Company, or (iii) any act or omission in respect
of which a determination could properly be made that Executive met the
applicable standard of conduct described for indemnification or
reimbursement or payment of expenses under the Articles of
Incorporation or Bylaws of the Company or the laws of the State of
Florida or the directors' and officers' liability insurance of the
Company, in each case as in effect at the time of such act or omission.
iii. Notwithstanding anything else contained in this
Agreement, this Agreement will not be deemed to have been terminated
for Cause unless and until there shall have been delivered to the
Executive a notice of termination stating that the Executive committed
one of the types of conduct set forth in this Section 6.c and
specifying the particulars thereof, and the Executive shall be given a
sixty (60) day period to cure such conduct, if possible.
d. Termination by the Company Other than for Cause, Death or
Disability.
i. The Company may terminate the Executive's employment for
whatever reason it deems appropriate provided, however, that unless
such termination is based on Cause, as provided in Section 6.c. above,
the Company may terminate this Agreement only upon giving three (3)
months' prior written notice. During such three (3) month period
preceding termination, the Executive will have all substantial rights
and shall be entitled to the same access and privileges to Company
property as he was preceding the notice of termination, and the Company
shall continue to provide all Compensation and Benefits under Section 5
of this Agreement to the Executive. The Company shall also be obligated
to pay to the Executive such amount of Bonus equal to the amount
received for the prior year or if no prior bonus an amount equal to
$150,000, as well as all earned but unpaid bonuses from previous years.
ii. The Executive will continue to receive all Compensation
and Benefits under Section 5 of this Agreement for a period of three
(3) years following termination. The Executive shall continue to
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receive Salary at the same rate and in the same form and manner as that
in the year of termination. The Executive shall continue to receive all
Benefits in the same form and manner as that in the year of
termination.
iii. The Executive, at his option, may require the Company to
make a lump sum payment at the time of termination of (a) all or a
portion of his entitled Compensation based on this Section 6.d, (b) all
or a portion of his entitled Benefits based on this Section 6.d, or (c)
any combination thereof.
iv. The foregoing notwithstanding, the Executive's employment
may not be terminated by the Company for any reason other than pursuant
to Section 6.a, Section 6.b and/or Section 6.c during the first three
(3) years of this Agreement.
v. The Company shall, upon demand, pay or reimburse Executive
for all legal fees and expenses of the Executive incurred as a result
of such Termination (including all such fees and expenses, if any,
incurred in contesting or disputing any such Termination, in seeking to
obtain or enforce any right or benefit provided by this Agreement, or
in interpreting this Agreement).
vi. The Executive shall be under no obligation to seek other
employment and there shall be no offset against any amounts due the
Executive under this Agreement on account of any remuneration
attributable to any subsequent employment that the Executive may obtain
(any amounts due under this Agreement are in the nature of severance
payments, or liquidated damages, or both, and are not in the nature of
a penalty).
vii. Unless the Executive is Terminated for Cause, Death or
Disability, the Company shall maintain in full force and effect, for
the Executive's continued benefit for a period to extend three (3)
years from the date of termination, all active and retirement Insurance
Benefits and other benefit programs or arrangements in which he was
entitled to participate immediately prior to the termination provided
that continued participation is possible under the general terms and
provisions of such plans and programs. In the event that participation
in any such plan or program is barred, the Company shall arrange to
provide the Executive with benefits substantially similar to those
which he is entitled to receive under such plans and programs.
viii. Unless the Executive is Terminated for Cause which is
not contested by the Executive, the Company shall allow the Executive
at Company expense, to continue to utilize the services of the
Company's certified public accountants, and/or another accountant or
attorney (including fees and expenses through all appeals) of his
choice for assistance in enforcing this Agreement and preparation of
his tax returns for the year following termination of employment. The
Company hereby waives any potential conflict as a result of such
representation.
e. Voluntary Termination. In the event the Executive terminates the
Executive's employment on the Executive's own volition (except as provided in
Section 6.f and/or Section 6.g) prior to the expiration of the Term of this
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Agreement, such termination shall constitute a Voluntary Termination. The
Company shall also be obligated to pay to the Executive all earned but unpaid
bonuses from past years performance.
f. Constructive Termination of Employment. If the Executive so elects,
a Termination by the Company Other than for Cause, Death or Disability under
Section 6.d shall be deemed to have occurred upon the occurrence of one or more
of the following events without the express written consent of the Executive:
i. a significant change in the nature or scope of the
authorities, powers, functions, duties or responsibilities attached to
Executive's position as described in Section 3;
ii. five percent (5%) reduction in the Executive's base
salary;
iii. a material breach of the Agreement by the Company;
iv. a material reduction of the Executive's benefits under any
Executive benefit plan, program or arrangement (for Executive
individually or as part of a group) of the Company as then in effect or
as in effect on the Effective Date of the Agreement, which reduction
shall not be effectuated for similarly situated Executives of the
Company;
v. by a successor company to assume the obligations under the
Agreement; or
vi. a change in the Executive principal office to a location
outside the Broward County, Florida area.
Anything herein to the contrary notwithstanding, the Executive shall
give written notice to the Board of Directors of the Company that the Executive
believes an event has occurred which would result in a Constructive Termination
of the Executive's employment under this Section 6.f, which written notice shall
specify the particular act or acts, on the basis of which the Executive intends
to so terminate the Executive's employment, and the Company shall then be given
the opportunity, within fifteen (15) days of its receipt of such notice to cure
said event, provided, however, there shall be no time period permitted to cure a
second or subsequent occurrence under this Section 6.f (whether such second
occurrence be of the same or a different event specified in subsections (i)
through (vi) above).
g. Termination Following a Change of Control.
i. In the event that a "Change in Control" or an "Attempted
Change in Control" as hereinafter defined, of the Company shall occur
at any time during the Term hereof, the Executive shall have the right
to terminate the Executive's employment under this Agreement upon
thirty (30) days written notice given at any time within one year after
the occurrence of such event, and such Termination of the Executive's
employment with the Company pursuant to this Section 6.g.i, then, in
any such event, such Termination shall be deemed to be a Termination by
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the Company Other than for Cause, Death or Disability and the Executive
shall be entitled to such Compensation and Benefits as set forth in
Subsection 6.d of this Agreement.
ii. For purposes of this Agreement, a "Change in Control" of
the Company shall mean a change in control (A) as set forth in Section
280G of the Internal Revenue Code or (B) of a nature that would be
required to be reported in response to Item 1 of the current report on
Form 8K, as in effect on the date hereof, pursuant to Section 13 or
15(d) of the Securities Exchange Act of 0000 (xxx "Xxxxxxxx Xxx");
provided that, without limitation, such a change in control shall be
deemed to have occurred at such time as:
(A) any "person", other than the Executive, (as such
term is used in Section 13(d) and 14(d) of the Exchange Act)
is or becomes the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities
of the Company representing thirty percent (30%) or more of
the combined voting power of the Company's outstanding
securities then having the right to vote at elections of
directors; or,
(B) the individuals who at the effective date of the
Agreement constitute the Board of Directors cease for any
reason to constitute a majority thereof unless the election,
or nomination for election, of each new director was approved
by a vote of at least two thirds of the directors then in
office who were directors at the commencement of the
Agreement; or
(C) there is a failure to elect such number of
directors as would constitute a majority of the Board of
Directors candidates nominated by the Company to the Board of
Directors; or
(D) the business of the Company for which the
Executive's services are principally performed is disposed of
by the Company pursuant to a partial or complete liquidation
of the Company, a sale of assets (including stock of a
subsidiary of the Company) or otherwise.
Anything herein to the contrary notwithstanding, this Section 6.g.ii
will not apply where the Executive gives his explicit written waiver stating
that for the purposes of this Section 6.g.ii a Change in Control shall not be
deemed to have occurred. The Executive's participation in any negotiations or
other matters in relation to a Change in Control shall in no way constitute such
a waiver which can only be given by an explicit written waiver as provided in
the preceding sentence.
An "Attempted Change in Control" shall be deemed to have occurred if
any substantial attempt, accompanied by significant work efforts and
expenditures of money, is made to accomplish a Change in Control, as described
in subparagraphs (A), (B), (C) or (D) above whether or not such attempt is made
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with the approval of a majority of the then current members of the Board of
Directors.
iii. In the event that, within twelve (12) months of any
Change in Control of the Company or any Attempted Change in Control of
the Company, the Company terminates the employment of the Executive
under this Agreement, for any reason other than for Cause as defined in
Section 6.c, or the Executive's employment is constructively terminated
as defined in Section 6.g.iv, then, in any such event, such Termination
shall be deemed to be a Termination by the Company Other than for
Cause, Death or Disability and the Executive shall be entitled to such
Compensation and Benefits as set forth in Subsection 6.d of this
Agreement.
iv. For purposes of this Section 6.g, the Executive's
employment shall be deemed constructively terminated in the event one
or more of the following events occurs without the express written
consent of the Executive:
(A) Significant change in the nature or scope of the
authorities, powers, functions, duties or responsibilities
attached to Executive's position as described in Section 3; or
(B) A five percent (5%) reduction in the Executive's
salary below the salary in effect immediately prior to such
reduction or a reduction in the target bonus participation
under Section 5.d as a percentage of salary; or
(C) Material breach of the Agreement by the Company;
or
(D) Material reduction of the Executive's benefits
under any Executive benefit plan, program or arrangement (for
Executive individually or as part of a group) of the Company
as then in effect or as in effect on the effective date or the
Agreement, which reduction shall not be effectuated for
similarly situated Executives of the Company; or
(E) Failure by a successor company to assume the
obligations under the Agreement; or
(F) Change in the Executive's principal office to a
location outside the Broward County, Florida.
v. Anything in this Section 6.g to the contrary
notwithstanding, in no event will any action or non-action by the
Executive at any time prior to the first anniversary date of the
applicable Change in Control or Attempted Change in Control (including
any action or non-action prior to the effective date of this Agreement)
be deemed consent to any of the events described in this Section 6.g.
vi. Anything herein to the contrary notwithstanding, in the
event the circumstances giving rise to an Attempted Change in Control
are included in those circumstances giving rise to an actual Change in
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Control the twelve (12) month period under this Section 6 will be
deemed to have recommenced on the date the actual Change in Control
occurred.
vii. If Executive, as a result of a Change in Control as
defined herein, shall incur any legal expenses as a result of such
Change in Control, the Executive shall be entitled to recover all
reasonable attorney's fees incurred by Executive.
7. Covenant Not to Compete and Non-Disclosure of Information.
a. Covenant Not to Compete. The Executive acknowledges and recognizes
the highly competitive nature of the Company's business and the goodwill,
continued patronage, and specifically the names and addresses of the Company's
Clients (as hereinafter defined) constitute a substantial asset of the Company
having been acquired through considerable time, money and effort. Accordingly,
in consideration of the execution of this Agreement, the Executive agrees to the
following:
i. That until a termination occurs for any reason under this
Agreement and for a one year period thereafter (as herein defined) and
within the Restricted Area (as hereinafter defined), the Executive will
not, individually or in conjunction with others, directly or
indirectly, engage in any Business Activities (as hereinafter defined),
whether as an officer, director, proprietor, employer, partner,
independent contractor, investor (other than as a holder solely as an
investment of less than 1% of the outstanding capital stock of a
publicly traded corporation), consultant, advisor, agent or otherwise.
ii. That until a termination occurs for any reason under this
Agreement and for a one year period thereafter, and within the
Restricted Area, the Executive will not, directly or indirectly,
compete with the Company by soliciting, inducing or influencing any of
the Company's clients which have a business relationship with the
Company at the time during the Restricted Period to discontinue or
reduce the extent of such relationship with the Company.
iii. That until a termination occurs for any reason under this
Agreement and for a one year period thereafter, and within the
Restricted Area, the Executive will not (A) directly or indirectly
recruit, solicit or otherwise influence any Executive or agent of the
Company to discontinue such employment or agency relationship with the
Company, or (B) employ or seek to employ, or cause or permit any
business which competes directly or indirectly with the Business
Activities of the Company (the "Competitive Business") to employ or
seek to employ for any Competitive Business any person who is then (or
was at any time within six (6) months prior to the date Executive or
the Competitive Business employs or seeks to employ such person)
employed by the Company.
iv. That until a termination occurs for any reason under this
Agreement and for a one year period thereafter, the Executive will not
interfere with, or disrupt or attempt to disrupt any past, present or
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prospective relationship, contractual or otherwise, between the Company
and any customer, Executive or agent of the Company.
v. In the event that a termination occurs "without cause" or
for disability by the Company under this Agreement, this Section 7.a
and all references thereto shall be inapplicable as to the Executive
and the Company.
b. Non-Disclosure of Information. The Executive acknowledges that the
Company's trade secrets, private or secret processes, methods and ideas, as they
exist from time to time, customer lists and information concerning the Company's
products, services, training methods, development, technical information,
marketing activities and procedures, credit and financial data concerning the
Company and/or the Company's Clients, and (the "Proprietary Information") are
valuable, special and unique assets of the Company, access to and knowledge of
which are essential to the performance of the Executive hereunder. In light of
the highly competitive nature of the industry in which the Company's business is
conducted, the Executive agrees that all Proprietary Information, heretofore or
in the future obtained by the Executive as a result of the Executive's
association with the Company shall be considered confidential.
In recognition of this fact, the Executive agrees that until a
termination occurs for any reason under this Agreement, the Executive will not
use or disclose any of such Proprietary Information for the Executive's own
purposes or for the benefit of any person or other entity or organization
(except the Company) under any circumstances unless: (i) such Proprietary
Information has been publicly disclosed generally; (ii) upon written advice of
legal counsel reasonably satisfactory to the Company; (iii) the Executive is
legally required to disclose such Proprietary Information; or (iv) unless such
documentation is necessary in order for the Executive to obtain investment or
tax advice.
c. Company's Clients. The "Company's Clients" shall be deemed to be any
persons, partnerships, corporations, professional associations or other
organizations for whom the Company has performed Business Activities.
d. Restricted Area. The Restricted Area shall be deemed to mean any
county of any state in which the Company is providing service at the time of a
termination under this Agreement.
e. Business Activities. "Business Activities" shall be deemed to
include retail travel services.
8. Indemnification. As an employee, officer and director of the
Company, the Executive shall be indemnified against and the Company shall use
its best efforts to maintain director and officer insurance in amounts not less
than $2,000,000 for all liabilities, damages, fines, costs and expenses to the
fullest extent to which employees, officers and directors of a corporation
organized under the laws of the state of Florida may be indemnified. The
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Executive shall continue to be covered by the Articles of Incorporation and/or
the Bylaws of the Company with respect to matters occurring on or prior to the
date of termination of the Executive's employment with the Company, subject to
all the provisions of Florida and Federal law and the Articles of Incorporation
and Bylaws of the Company then in effect. Such reasonable expenses, including
attorneys' fees, that may be covered by the Articles of Incorporation and/or
Bylaws of the Company shall be paid by the Company on a current basis in
accordance with such provision, the Company's Articles of Incorporation and
Florida law.
9. Withholding. Anything to the contrary notwithstanding, all payments
required to be made by the Company hereunder to the Executive or the Executive's
estate or beneficiaries shall be subject to the withholding of such amounts, if
any, relating to tax and other payroll deductions as the Company may reasonably
determine it should withhold pursuant to any applicable law or regulation. In
lieu of withholding such amounts, the Company may accept other arrangements
pursuant to which it is satisfied that such tax and other payroll obligations
will be satisfied in a manner complying with applicable law or regulation.
10. Notices. Any notice required or permitted to be given under the
terms of this Agreement shall be sufficient if in writing and if sent postage
prepaid by registered or certified mail, return receipt requested; by overnight
delivery; by courier; or by confirmed telecopy, in the case of the Executive to
the Executive's last place of business or residence as shown on the records of
the Company, or in the case of the Company to its principal office as set forth
in the first paragraph of this Agreement, or at such other place as it may
designate.
11. Certain Tax Matters. The Company shall indemnify and hold the
Executive harmless from and against (i) the imposition of excise tax (the
"Excise Tax") under Section 4999 of the Internal Revenue Code of 1986, as
amended (or any successor provision thereto, the "Code"), on any payment made
under this Agreement (including any payment made under this paragraph) and any
interest, penalties and additions to tax imposed in connection therewith, and
(ii) any federal, state or local income tax imposed on any payment made pursuant
to this paragraph. The Executive shall not take the position on any tax return
or other filing that any payment made under this Agreement is subject to the
Excise Tax, unless, in the opinion of independent tax counsel reasonably
acceptable to the Company, there is no reasonable basis for taking the position
that any such payment is not subject to the Excise Tax under U.S. tax law then
in effect. If the Internal Revenue Service makes a claim that any payment or
portion thereof is subject to the Excise Tax, at the Company's election, and the
Company's direction and expense, the Executive shall contest such claim;
provided, however, that the Company shall advance to the Executive the costs and
expenses of such contest, as incurred. For the purpose of determining the amount
of any payment under clause (ii) of the first sentence of this paragraph, the
Executive shall be deemed to pay federal income taxes at the highest marginal
rate of federal income taxation applicable to individuals in the calendar year
in which such indemnity payment is to be made and state and local income taxes
at the highest marginal rates of taxation applicable to individuals as are in
effect in the jurisdiction in which the Executive is resident, net of the
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reduction in federal income taxes that is obtained from deduction of such state
and local taxes.
12. Waiver. Unless agreed in writing, the failure of either party, at
any time, to require performance by the other of any provisions hereunder shall
not affect its right thereafter to enforce the same, nor shall a waiver by
either party of any breach of any provision hereof be taken or held to be a
waiver of any other preceding or succeeding breach of any term or provision of
this Agreement. No extension of time for the performance of any obligation or
act shall be deemed to be an extension of time for the performance of any other
obligation or act hereunder.
13. Completeness and Modification. This Agreement constitutes the
entire understanding between the parties hereto superseding all prior and
contemporaneous agreements or understandings among the parties hereto concerning
the Employment Agreement. This Agreement may be amended, modified, superseded or
canceled, and any of the terms, covenants, representations, warranties or
conditions hereof may be waived, only by a written instrument executed by the
parties or, in the case of a waiver, by the party to be charged.
14. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which shall
constitute but one agreement.
15. Binding Effect/Assignment. This Agreement shall be binding upon the
parties hereto, their heirs, legal representatives, successors and assigns. This
Agreement shall not be assignable by the Executive but shall be assignable by
the Company in connection with the sale, transfer or other disposition of its
business or to any of the Company's affiliates controlled by or under common
control with the Company.
16. Governing Law Venue. This Agreement shall become valid when
executed and accepted by Company. The parties agree that it shall be deemed made
and entered into in the State of Florida and shall be governed and construed
under and in accordance with the laws of the State of Florida. Any action or
dispute concerning this Agreement shall be brought in the appropriate court in
Broward County, Florida. Anything in this Agreement to the contrary
notwithstanding, the Executive shall conduct the Executive's business in a
lawful manner and faithfully comply with applicable laws or regulations of the
state, city or other political subdivision in which the Executive is located.
17. Further Assurances. All parties hereto shall execute and deliver
such other instruments and do such other acts as may be necessary to carry out
the intent and purposes of this Agreement.
18. Headings. The headings of the sections are for convenience only and
shall not control or affect the meaning or construction or limit the scope or
intent of any of the provisions of this Agreement.
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19. Survival. Any termination of this Agreement shall not, however,
affect the ongoing provisions of this Agreement which shall survive such
termination in accordance with their terms.
20. Severability. The invalidity or unenforceability, in whole or in
part, of any covenant, promise or undertaking, or any section, subsection,
paragraph, sentence, clause, phrase or word or of any provision of this
Agreement shall not affect the validity or enforceability of the remaining
portions thereof.
21. Enforcement. Should it become necessary for any party to institute
or defend any action whatsoever in order to enforce the terms and conditions of
this Agreement, the Executive shall be awarded all reasonable costs and fees
incurred as a result of such action.
22. Construction. This Agreement shall be construed within the fair
meaning of each of its terms and not against the party drafting the document.
THE EXECUTIVE ACKNOWLEDGES THAT THE EXECUTIVE HAS READ ALL OF THE TERMS OF THIS
AGREEMENT, UNDERSTANDS THE AGREEMENT, AND AGREES TO ABIDE BY ITS TERMS AND
CONDITIONS.
IN WITNESS WHEREOF, the parties have executed this Agreement as of date
set forth in the first paragraph of this Agreement.
THE COMPANY:
ONLINE VACATION CENTER HOLDINGS CORP.
By:/S/XXXXXX X. XXXXXX
-----------------------
Xxxxxx X. Xxxxxx, President
and Chief Executive Officer
THE EXECUTIVE:
/S/XXXXXX X. XXXXXX
--------------------------
Xxxxxx X. Xxxxxx
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