September 23, 2005
Xxxxxxx X. Xxxxxxxxx
President and CEO
Dear Xxxx:
This letter (the "Agreement") outlines the terms of your employment with
PowerLinx (the "Company"), effective May 16, 2005 (the "Effective Date"). This
Agreement supersedes and replaces in all respects your previous employment
agreement(s), and in agreeing to the terms of this Agreement, you also agree
that your previous employment agreements) is/are cancelled in all respects.
TERM OF THE AGREEMENT
---------------------
The term of this Agreement is for a period of three (3) years from its
Effective Date (the "Term"). Your base salary is initially set at a rate of
$150,000 annually (the "Base Salary"). The Compensation Committee of the Board
(the "Compensation Committee") will review your base salary at least annually
and may adjust it, as the Compensation Committee deems proper, in accord with
your job performance.
STOCK AWARD
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You are hereby granted a common stock award of 1,300,000 shares. You may
receive future grants and/or options as determined by the Compensation
Committee.
BONUS
-----
Although the Effective Date of this Agreement is May 16, 2005, its bonus
provisions cover the full calendar year 2005. You are eligible to receive a
bonus, computed quarterly, in an amount equivalent to a minimum of 30% (the
"Bonus Percentage") of your base salary earned during the previous calendar
quarter ("Quarterly
Bonus"). Your Bonus Percentage will be determined annually by the Compensation
Committee. The Quarterly Bonus will be paid at the end of the applicable
quarter, and will be paid to you in your choice of cash, shares of common stock,
or a combination thereof. The Quarterly Bonus will vest only at the end of the
applicable quarter, and you must be employed by the Company at the end of the
applicable quarter to be eligible to receive the Quarterly Bonus attributable to
that quarter.
FRINGE BENEFITS
---------------
You will receive $750.00 per month as an Auto Allowance (covering fuel,
maintenance, insurance, parking, tolls, and any other automobile transportation
expenses you may incur). You will receive three (3) weeks of paid vacation each
year, to be used during that calendar year. There is no carryover for unused
vacation. Your remaining fringe benefits, including group health plan, paid sick
leave, 401(k) plan, etc., will be in accordance with general Company policies
applicable to all employees. Your travel (other than expenses included in your
Auto Allowance) and entertainment expense approvals and reimbursements will also
be handled in accordance with general Company policies applicable to all
employees.
TERMINATION FOR CAUSE
---------------------
If your employment with the Company is terminated for "Cause" (as defined
herein) as reasonably determined by the Board of Directors (the "Board"), or if
you elect to terminate your employment with the Company voluntarily, without the
agreement of the Board, this Agreement will immediately end, and no additional
compensation will be paid to you, except for your salary for services rendered
through the date of your termination, and any expenses previously submitted and
approved for reimbursement. If you elect to terminate your employment with the
Company voluntarily, with the agreement of the Board, this Agreement will
immediately end, and no additional compensation will be paid to you, except for
your salary for services rendered through the date of your termination, any
expenses previously submitted and approved for reimbursement, and any unused
vacation remaining for that calendar year. If your employment is terminated by
the Company for any reason other than for "Cause", this
Agreement will immediately end, and no additional compensation will be paid
to you, except you will receive the Base Salary remaining under the Term of this
Agreement.
As used in this Agreement, "Cause" shall mean: (i) engaging in conduct
which has caused or is reasonably likely to cause demonstrable and serious
injury to the Company, whether financial or otherwise; (ii) engaging in conduct
which gives rise to or results in action by the SEC against you, whether in your
official or individual capacity, or against the Company; (iii) committing,
confessing, pleading guilty, nolo contendre or no contest (or their equivalent)
to, entering into a pretrial intervention or diversion program, having
adjudication withheld, or being sanctioned (or their equivalent) regarding, or
being convicted of, a felony or any crime (whether misdemeanor or other) or
violation of any law, rule, or regulation involving moral turpitude, fraud,
dishonesty, misappropriation, embezzlement, misrepresentation; (iv) refusal to
perform your duties or responsibilities hereunder as determined by the Board;
(v) chronic absenteeism as determined by the Board; (vi) use of illegal drugs;
(vii) insobriety while performing your duties hereunder; (viii) falsification of
any report, record, or information submitted by you to the Company; or (ix)
material violation of the Confidentiality, No Competition, or No Solicitation
provisions of this Agreement.
TERMINATION FOLLOWING DISABILITY
--------------------------------
You agree that the Company may terminate this Agreement if, because of
illness or incapacity, you become unable to perform the essential functions of
your position with the Company ("Disabled") for a cumulative twelve (12) week
period over the course of a twelve (12) month period. Such cumulative twelve
(12) month period shall commence on the date you become Disabled, and shall
re-recommence on the anniversary of that date, provided you are performing the
essential functions of employment on the anniversary of that date. If you are
not performing the essential functions of your position on the anniversary of
the date you become Disabled, such cumulative twelve (12) month period shall
re-commence on the date you resume performing the essential functions of your
position. If this Agreement is terminated in accordance with this provision, you
and the Company agree that the Company shall have no further obligations to you
under this Agreement. All terms of this provision are intended to
comply with the Family and Medical Leave Act of 1993 ("FMLA") and the Americans
with Disabilities Act of 1991 ("ADA"), however, this provision shall not limit
or restrict in any way any other rights the Company may have under either the
FMLA or the ADA.
TERMINATION UPON DEATH
----------------------
You and the Company agree that this Agreement shall terminate immediately
upon your death, and the Company shall have no further obligations to you under
this Agreement.
TERMINATION UPON DISSOLUTION OR LIQUIDATION
-------------------------------------------
You and the Company agree that this Agreement shall terminate upon the
dissolution or liquidation of the Company, and the Company shall have no further
obligations to you under this Agreement.
LEGAL EXPENSES
--------------
The Company agrees to advance any reasonable legal expenses or related
costs which you may incur in connection with a) the current and any subsequent
SEC investigations involving the Company, and/or b) in connection with any other
investigation, administrative proceeding, or litigation wherein you are named as
a defendant in your individual capacity, related to or arising from your
position and employment with the Company.
CONFIDENTIALITY
---------------
You recognize and acknowledge that because of the position of trust you
hold with the Company, you have access to, acquire, and assist in developing
confidential and proprietary information relating to the business and operations
of the Company and certain of its predecessors, and affiliated entities,
including but not limited to, information relating to trade secrets, research or
development projects or results, strategic marketing and business plans and/or
materials, business methods, business policies or practices, techniques,
advertising, sales, ongoing business operations and practices, financial data,
software codes, and business and customer relationships of the Company
(including customer lists and names and addresses of customers) (collectively,
the "Confidential
Information"). Confidential Information does not include any information which
(i) is or becomes generally available to the public other than as a result of a
disclosure in violation of this clause; (ii) becomes available to you on a
non-confidential basis from a source other than the Company or its agents; (iii)
was known by you prior to its disclosure by the Company or its agents; or (iv)
is required to be disclosed by order of a court of competent jurisdiction. You
acknowledge that the Confidential Information has been and will continue to be
of central importance to the Company and that disclosure of such information or
its use by others could cause substantial loss to the Company.. You agree that:
(a) All Confidential Information of any kind furnished to you by the
Company or its predecessors or affiliated entities or developed by you on behalf
of the Company or its predecessors or affiliated entities or at their direction
or for their use or otherwise in connection with your employment (whether
before, during, or after the Term of this Agreement) is and shall remain the
confidential property of the Company, for the sole use of the Company, and shall
remain protected for the longest period allowed under applicable state and/or
federal law, including protection provided by the Uniform Trade Secrets Act.
(b) You agree that you will not (whether before, during, or after the Term
of this Agreement) reveal such Confidential Information to any person or
organization; or use such Confidential Information in a manner that would be
detrimental to the Company.
(c) Upon the termination of your employment with the Company, whether
voluntarily or involuntarily, you agree that you will not take any original or
copy of any document or electronic file that belongs to the Company that you
received while employed by the Company or its predecessors or affiliated
entities.
NO COMPETITION
--------------
During your employment, and for a term of six (6) months after your
employment with the Company ends, whether voluntarily or involuntarily, or for
the period during which you continue to receive any Base Salary from the
Company, whichever is longer, you agree that you will not, directly or
indirectly, own, manage, operate, join or control, or participate in the
ownership, management, operation, or control of, or be a director, stockholder
or an employee of, or a consultant to, any business, form, corporation, or
entity which:
(a) Is conducting business which competes with the business of the Company
or its predecessors or affiliated entities, as conducted any time during your
employment with the Company, its predecessors or affiliated entities, or
(b) Is or was at any time during your employment with the Company or its
predecessors or affiliated entities, a vendor, supplier, customer or distributor
of the Company or its predecessors or affiliated entities. The provisions of
this paragraph are not intended to nor shall they prevent you from owning five
(5) percent or less of the outstanding stock of any publicly traded company.
NO SOLICITATION
---------------
During your employment, and for a term of six (6) months after your
employment with the Company ends, whether voluntarily or involuntarily, or for
the period during which you continue to receive any Base Salary from the
Company, whichever is longer, you agree that you will not, directly or
indirectly:
(a) solicit orders for merchandise, products, and/or services sold or
rendered by the Company or its predecessors or affiliated entities while you
were employed by the Company or its predecessors or affiliated entities from
current or former customers of the Company, whether such solicitation is for
your own account, or for the account of any other person or entity, or
(b) attempt to induce or influence any person who was employed by the
Company on the date your employment with the Company ended, whether voluntarily
or involuntarily, or who was employed by the Company at any time during which
you received any Base Salary from the Company, or who was employed by the
Company at the expiration of the tern of this Agreement, whichever is later, to
leave the employment of the Company.
SURVIVAL OF RESTRICTIVE COVENANTS
---------------------------------
You agree that each covenant outlined above (the paragraphs entitled "NO
COMPETITION", and "NO SOLICITATION" (collectively the "Restrictive Covenants"))
shall, unless otherwise indicated above, each be construed as agreements
independent of any other covenant or provision of this Agreement, and shall
survive the termination of this Agreement, and the existence of any claim,
complaint, or cause of action that you may have against the Company, whether
based upon or arising from this Agreement or otherwise, and shall not constitute
a defense to the enforcement of any or all of the Restrictive Covenants by the
Company. You agree that a breach of any of the Restrictive Covenants shall
automatically toll and suspend the period of the restriction for as long as the
breach continues.
REMEDY FOR BREACH OF RESTRICT WE COVENANTS
------------------------------------------
You agree that the breach of any of the Restrictive Covenants by you will
result in irreparable damage to the Company, and that in the event that you
breach or threaten to breach any of the Restrictive Covenants, the Company shall
be entitled to immediate preliminary and/or permanent injunctive relief, in any
court of competent jurisdiction, as well as liquidated damages and any other
money damages, insofar as they may be determined or provided for in this
Agreement, as well as attorneys' fees and costs.
You and the Company agree that it may be difficult, if not impossible, to
accurately determine the amount of damages the Company may occur if you breach
any of the Restrictive Covenants. You agree that should you breach any of the
Restrictive Covenants, the Company shall be entitled to immediately stop making
any payments to you of the balance of any Base Salary remaining under the Term
of this Agreement. You agree that this is a reasonable amount, as liquidated
damages and not as a penalty, based upon the facts and circumstances of known to
you and the Company at the time of entering into this Agreement, and with due
regard to the future expectations of you and the Company. This amount
constitutes the minimum amount of damages which will be incurred by the Company
if you breach any of the Restrictive Covenants. You agree that the Company shall
be entitled to seek and obtain the full amount of the actual damages incurred by
the Company as a result of any breach or violation by you of any of the
Restrictive Covenants, as well as attorneys' fees and costs. You acknowledge and
agree that the Company shall also be entitled to seek injunctive relief with
regard to any such breach or violation by you of any of the Restrictive
Covenants.
You agree that in any action by the Company to obtain injunctive relief,
the Company shall not be required to post an injunction bond in excess of One
Thousand Dollars ($1000.00) in order to obtain a temporary restraining order
and/or preliminary injunction. Should the Company's action for a temporary
restraining order and/or preliminary injunction be granted in whole or in part,
and should the Company be ultimately unsuccessful in obtaining a permanent
injunction to enforce any of the Restrictive Covenants, you hereby waive any and
all rights you may have against the Company for any injuries or damages,
including consequential damages, allegedly sustained by you arising directly or
indirectly from the issuance of the temporary restraining order and/or
preliminary injunction.
SCOPE OF THE RESTRICTIVE COVENANTS
----------------------------------
You and the Company agree that if any court or other judicial authority
finds that any of the Restrictive Covenants are overbroad as to the geographic
area, activity, or time period covered, that geographic area, activity, or time
period shall be reduced to whatever extent such court or other judicial
authority deems to be reasonable and appropriate, and the Restrictive Covenants
shall be enforced to the full extent of such reduced geographic area, activity,
or time period.
WAIVER OF TRIAL BY JURY
-----------------------
In the event of any dispute regarding this Agreement, or for any action
whatsoever regarding or arising from this Agreement, or regarding or arising
from your employment with PowerLinx, both you and the Company agree to waive any
right to a trial by jury.
VENUE AND CHOICE OF LAW
-----------------------
You and the Company agree that a) the venue for the enforcement of this
Agreement, or for any action whatsoever regarding or arising from this
Agreement, or regarding or arising from your employment with PowerLinx, shall be
in Hillsborough
County, Florida; and b) this Agreement and/or any action whatsoever regarding or
arising from this Agreement or for any action whatsoever regarding or arising
from this Agreement, or regarding or arising from your employment with PowerLinx
shall be interpreted under and governed by Florida law, excluding its choice of
law provisions.
ABILITY TO EARN A LIVING
You acknowledge and represent that when this Agreement is complete, you
will be able to earn a living without violating the Restrictive Covenants, and
your recognition and representation of this fact is a material condition to the
execution of this Agreement and to your continued employment with the Company.
PowerLinx is genuinely fortunate in having you serve the Company. Your
signature below acknowledges your acceptance of the terms of this Agreement.
Sincerely,
Sincerely,
Xxxxx Xxxxxxxx
Chairman of the Board Of Directors
/s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx
for the Compensastion Committe
Accepted
/s/ Xxxxxxx X. Xxxxxxxxx
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Xxxxxxx X. Xxxxxxxxx
