EMPLOYMENT AGREEMENT
GLOBAL AXCESS CORP, a Nevada
corporation with its principal office in Jacksonville, Florida (the “Corporation”) and
Xxxxxxx Xxxxxxxx, an individual residing in Jacksonville, Florida, (the “Employee”) have, as
of this 21st
day of October, 2010, in consideration of the mutual promises and covenants of
the parties, together with other valuable consideration, the receipt and legal
sufficiency of which are hereby acknowledged, Corporation and Employee have
agreed as follows:
AGREEMENT
In consideration of the mutual promises
and covenants of the parties, together with other valuable consideration, the
receipt and legal sufficiency of which are hereby acknowledged, Corporation and
Employee have agreed as follows:
1. Employment. Corporation
hereby employs Employee as the Chief Financial Officer and Chief Accounting
Officer of Corporation, and Employee hereby accepts employment by Corporation
upon the terms and conditions of this Agreement. The parties
acknowledge and agree that this Agreement materially enhances the terms and
conditions of Employee’s existing employment relationship with Employer, and
that no breach or interruption in the employment or service by Employee shall be
deemed to have occurred as a result of Corporation and Employee entering into
this Agreement.
2. Duties. Employee
shall serve as the Chief Financial Officer and Chief Accounting Officer of
Corporation. Employee shall perform such duties as may be reasonably
required by the Board of Directors, the Chairman of Corporation, or their
designee, or the President and Chief Executive Officer from time to
time. Changes in or additions to Employee’s duties or title(s) under
this Agreement are not to be accompanied by additional compensation unless
expressly agreed to by Corporation. During the term of this
Agreement, Employee agrees to serve Corporation faithfully and to devote
substantially all of Employee’s business time, attention and energies to the
business of Corporation and to the proper and timely discharge of Employee’s
duties. Employee represents and warrants that Employee is not subject
to any agreement or contract with any person or entity that will in any manner
prevent Employee from performing any of Employee’s duties under this
Agreement. Employee further represents and warrants that Employee has
not used or disclosed and will not use or disclose in the scope of Employee’s
employment any confidential, proprietary and/or trade secret materials,
documents or information that Employee obtained from a former employer or one to
whom Employee may owe any obligation of confidentiality or
nondisclosure.
3. Remuneration and Fringe
Benefits.
3.1 As full
and complete remuneration for all personal services rendered as an employee
pursuant to Paragraph 2 hereof, for so long as Employee is employed hereunder by
Corporation, Employee shall receive the following:
3.1.1 Initial
compensation as set forth on Schedule 1 attached hereto. Such
compensation may be adjusted from time to time by Corporation following notice
to Employee.
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3.1.2 Such
applicable fringe benefits as may be provided by Corporation from time to time;
provided Employee is otherwise eligible and desires to participate; and provided
further, that Corporation shall not be obligated hereby to implement any
benefits not presently in existence or to continue to maintain any benefits
presently in existence or to provide special benefits to Employee.
3.1.3 Vacation
each year with pay in accordance with Corporation policy.
3.1.4 Reimbursement
for all ordinary, necessary and reasonable business expenses, including without
limitation travel expenses, incurred by Employee in accordance with Corporation
policy in effect from time to time and in connection with the performance of
Employee’s duties pursuant to Paragraph 2 hereof. Reimbursement of
such expenses shall be made after Employee presents appropriate written
vouchers, bills, reports or other substantiation for such expenses in form
acceptable to the Internal Revenue Service and in compliance with Corporation’s
policy.
4. Term and
Termination.
4.1 The
initial term of this Agreement and Employee’s employment hereunder shall be for
a period of one (1) year, and shall commence effective June 1, 2010 and shall
expire at midnight on June 1, 2011. Absent a termination or notice of
termination as provided herein, beginning on the first anniversary of this
Agreement and at the end of each succeeding calendar month, the term shall
automatically extend for an additional one (1) year on the same terms and
conditions contained herein.
4.2 Notwithstanding
the provisions of paragraph 4.1, this Agreement and Employee’s employment
hereunder may be terminated as follows:
4.2.1 By
Corporation at any time, without notice and with immediate effect, for
Cause. “Cause”
means:
(i) Willful
failure of Employee to substantially comply with reasonable written directives
of Corporation’s Board of Directors or its designee or the President and Chief
Executive Officer.
(ii) Any of
the following actions by Employee, if in the judgment of Corporation’s Board of
Directors or its designee or the President and Chief Executive Officer such
actions are materially injurious to Corporation:
(a) actions
involving moral turpitude; or
(b) illegal
use of controlled substances.
4.2.2 By the
Board of Directors of Corporation, upon notice to Employee of termination
without Cause.
4.2.3 By
Employee for any reason.
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4.3 In the
event of a termination of Employee’s employment hereunder without Cause by
Corporation, provided that Employee complies with the Restrictive Covenants
contained herein, Employee shall be entitled to receive salary continuation
payments at Employee’s base salary rate, in effect as of the date of Employee’s
termination of employment, less applicable tax withholding, payable in equal
installments in accordance with Corporation’s usual payroll practices (but no
less than monthly), over the following time period: (i) if the termination
occurs during the initial term, for the remaining portion of such initial term,
or for nine (9) months after the date of termination of Employee’s employment,
whichever is longer, or (ii) for any termination occurring after the initial
term, for nine (9) months after the date of termination of Employee’s
employment. Corporation will also pay Employee’s health, life,
dental, short term disability, and long term disability insurance premiums that
Corporation is paying at the time of termination of Employee’s employment during
the same time period. Corporation will also pay Employee for his
accrued but unused paid time off and any bonuses earned by the date of
Employee’s termination. Except as provided below, such payments shall
commence on the first payroll payment date coincident with or next following
Employee’s termination of employment.
Notwithstanding
anything in this Agreement to the contrary, the payments described in this
Paragraph 4.3 shall not be paid or payable unless on or before the sixtieth
(60th) day
following Employee’s termination of employment, Employee has provided
Corporation with an executed general release of all claims arising out of or
related to Employee’s employment with Corporation, and such release is not
subject to revocation, in a form and manner satisfactory to Corporation (the
“Release
Agreement”), which shall be provided by Corporation to Employee within
ten (10) days of Employee’s termination of employment. Any payments
that become due and payable under this Paragraph 4.3 during this sixty (60) day
period shall be paid in a single lump sum on the sixtieth (60th) day
and all subsequent payments shall be paid in installments as described
above.
4.4 The
provisions of Subparagraph 4.3 and Paragraph 5 of this Agreement shall survive
termination or expiration of this Agreement or employment hereunder for any
reason. Except as provided in Paragraph 4.3, termination of
employment shall constitute termination of Corporation’s obligations under
Paragraph 3 hereof, effective immediately upon termination of
employment.
5. Restrictive
Covenants. For purposes of this Agreement, “Restrictive
Covenants” mean the provisions of this Paragraph 5. It is
stipulated and agreed that Corporation is engaged in the business of providing
unattended self-service kiosk services (such business, together
with any other lines of business in which Corporation becomes engaged during the
term of this Agreement, being referred to herein as the “Business”). It
is further stipulated and agreed that as a result of Employee’s employment by
Corporation, Employee will have access to valuable, highly confidential,
privileged, and proprietary information relating to Corporation’s Business,
including, without limitation, existing and future equipment information,
customer lists, identities of distributors and distributorships, sales methods
and techniques, costs and costing methods, pricing techniques and strategies,
sales agreements with customers, profits and product line profitability
information, unpublished present and future marketing strategies and promotional
programs, and other information regarded by Corporation as proprietary and
confidential (the “Confidential
Information”). It is further acknowledged that unauthorized
use or disclosure by Employee of Confidential Information would seriously damage
Corporation in its Business.
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In consideration of the provisions of
this Paragraph 5, the term of employment granted to Employee in Paragraph 4 of
this Agreement and the payments and benefits referred to in Paragraphs 3 and 4.3
hereof, that Employee acknowledges are legally sufficient to support
enforceability by Corporation of the Restrictive Covenants against Employee,
Employee agrees as follows:
5.1 During
the term of this Agreement and after its termination or expiration for any
reason, Employee will not, without Corporation’s prior written consent, use,
divulge, disclose, furnish, or make accessible to any third person, company, or
other entity any aspect of Confidential Information (other than as required in
the ordinary discharge of Employee’s duties hereunder).
5.2 During
the term of this Agreement and for a period of one year and six months after the
date of the expiration or termination of this Agreement for any reason (the
“Restrictive
Period”), Employee shall not directly or indirectly:
(i) employ,
or solicit the employment of, any person who at any time during the twelve (12)
calendar months immediately preceding the termination or expiration of this
Agreement was employed by Corporation;
(ii) provide
or solicit the provision of products or services, similar to those provided by
Corporation, to any person or entity who purchased or leased products or
services from Corporation at any time during the twelve (12) calendar months
immediately preceding the termination or expiration of this Agreement for any
reason and for or with whom Employee had contact, responsibility or access to
Confidential Information related to such person or entity; provided, however,
the restrictions of this subsection (ii) shall be limited in scope to the
“Territory” (as defined below) and to any office, store or other place of
business in which, or in connection with which, Employee has had business
contact with such persons or entities during the twelve (12) calendar months
immediately preceding the termination or expiration of this Agreement for any
reason;
(iii) interfere
or attempt to interfere with the terms or other aspects of the relationship
between Corporation and any person or entity from whom Corporation has purchased
equipment, supplies or inventory at any time during the twelve (12) calendar
months immediately preceding the termination or expiration of this Agreement and
for or with whom Employee had contact, responsibility or access to Confidential
Information related to such person or entity;
(iv) compete
with Corporation, its successors and assigns by engaging, directly or
indirectly, in the Business Corporation is engaged in on the date of the
expiration or termination of this Agreement and as conducted or in a business
substantially similar to the Business Corporation is engaged in on the date of
the expiration or termination of this Agreement within the “Territory,” as
hereinafter defined (“Restricted Business”); or
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(v) provide
information to, solicit or sell for, organize or own any interest in (either
directly or through any parent, affiliate, or subsidiary corporation,
partnership, or other entity), or become employed or engaged by, or act as agent
for any person, corporation, or other entity that is directly or indirectly
engaged in a business in the “Territory”, as hereinafter defined, which is
substantially similar to the Business as conducted by or competitive with
Corporation’s Business; provided, however, that nothing herein shall preclude
Employee from holding not more than one percent (1%) of the outstanding shares
of any publicly held company which may be so engaged in a trade or business
identical or similar to the Business of Corporation.
As used herein, the “Territory” means any
state that Corporation did business within the last twelve (12) months of
Employee’s employment and Employee had business contact with such persons or
entities during the twelve (12) calendar months immediately preceding the
termination or expiration of this Agreement for any reason.
5.3 In the
event of a breach or threatened breach by Employee of any of the Restrictive
Covenants contained in this Paragraph 5, Corporation, in addition to and not in
derogation of any other remedies it may have, shall be entitled to any or all of
the following remedies:
5.3.1 It is
stipulated that a breach by Employee of the Restrictive Covenants would cause
irreparable damage to Corporation; Corporation, in addition to any other rights
or remedies which Corporation may have, shall be entitled to an injunction
restraining Employee from violating or continuing any violation of such
Restrictive Covenants; such right to obtain injunctive relief may be exercised,
at the option of Corporation, concurrently with, prior to, after, or in lieu of,
the exercise of any other rights or remedies which Corporation may have as a
result of any such breach or threatened breach;
5.3.2 Employee
agrees that upon breach of any of the Restrictive Covenants, Corporation shall
be entitled to an accounting and repayment of all profits, royalties,
compensation, and/or other benefits that Employee directly or indirectly has
realized or may realize as a result of, or in connection with, any such
breach.
5.3.3 Employee
agrees that the Restrictive Period shall not include any period of time in which
Employee is in violation of the Restrictive Covenants.
6. Change of
Control. If there is a Change of Control, as defined herein,
and if within six (6) months of such Change of Control (a) Employee’s base
salary is reduced and (b) Employee’s job responsibilities (as in effect during
Employee’s employment with Corporation in Jacksonville, Florida prior to the
Change of Control) are diminished, Employee may terminate his employment with
Corporation within thirty (30) days of such reduction in salary and diminution
in job responsibilities. In connection with such termination of
employment, provided that Employee complies with the Restrictive Covenants
contained herein, Employee shall be entitled to receive salary continuation
payments at Employee’s base salary rate, in effect as of Employee’s termination
of employment, less applicable tax withholding, payable in equal installments in
accordance with Corporation’s usual payroll practices (but no less than
monthly), over the following time period: (i) if the termination occurs during
the initial term, for the remaining portion of such initial term, or for one (1)
year after the date of termination of Employee’s employment, whichever is
longer, or (ii) for any termination occurring after the initial term, for one
(1) year after the date of termination of Employee’s
employment. Corporation will also pay Employee’s health, life,
dental, short term disability, and long term disability insurance premiums
during the same time period. Corporation will also pay Employee for
his accrued but unused paid time off and any bonuses earned by the date of
Employee’s termination. Except as provided below, such payments shall
commence on the first payroll payment date coincident with or next following
Employee’s termination of employment.
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Notwithstanding
anything in this Agreement to the contrary, the payments described in this
Paragraph 6 shall not be paid or payable unless on or before the sixtieth
(60th) day
following Employee’s termination of employment, Employee has provided
Corporation with an executed Release Agreement, which shall be provided by
Corporation to Employee within ten (10) days of Employee’s termination of
employment. Any payments that become due and payable under this
Paragraph 6 during this sixty (60) day period shall be paid in a single lump sum
on the sixtieth (60th) day
and all subsequent payments shall be paid in installments as described
above.
For
purposes of this Agreement, “Change of Control” shall mean the acquisition by
any individual, entity or group (within the meaning of Section 409A of the
Internal Revenue Code of 1986, as amended (“Section 409A”)) (a “Person”) of
ownership of stock of Corporation that, together with stock held by such Person,
constitutes more than 50% of the total fair market value or total voting power
of the stock of Corporation. However, if any Person is considered to
own more than 50% of the total fair market value or total voting power of the
stock of Corporation, the acquisition of additional stock by the same Person is
not considered to cause a change in ownership of Corporation (or to cause a
change in the effective control of Corporation). An increase in the
percentage of stock owned by any one Person as a result of a transaction in
which Corporation acquires its stock in exchange for property will be treated as
an acquisition of stock for purposes of this paragraph. This
paragraph applies only when there is a transfer of stock of Corporation (or
issuance of stock of Corporation) and stock in Corporation remains outstanding
after the transaction.
7. Surrender of Books and
Records. Employee acknowledges that all files, records, lists,
designs, specifications, formulas, books, products, and other materials owned
and used by Corporation in connection with the conduct of its Business shall at
all times remain the property of Corporation, and that upon termination or
expiration of this Agreement or employment hereunder for any reason or upon
demand by Corporation, Employee will surrender to Corporation all such
materials.
8. Waiver of
Breach. The waiver by either party of any breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach.
9. Severability. The
provisions of this Agreement, particularly Paragraph 5, are hereby deemed by the
parties to be severable, and the invalidity or unenforceability of any one or
more of the provisions of this Agreement shall not affect the validity or
enforceability of the other provisions hereof.
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10. Acknowledgment of
Reasonableness. Employee has carefully read and considered the
provisions of this Agreement and expressly agrees that the provisions hereof,
including without limitation the Restrictive Covenants, are fair and reasonable
and reasonably required for Corporation’s protection of its legitimate business
interests, including, without limitation, the confidential and proprietary
information and trade secrets of Corporation, the substantial relationships
between Corporation and its customers, officers, directors, employees,
independent contractors, agents and other personnel, and the goodwill of
Corporation. In the event that any provision of Paragraph 5 relating
to the Restrictive Period, the Territory and/or the scope of activity restricted
shall be declared by a court of competent jurisdiction to exceed the maximum
time period, geographical area and/or scope of activity restricted that such
court deems reasonable and enforceable under applicable law, the time period,
area of restriction and/or scope of activity restricted that is held reasonable
and enforceable by the court shall thereafter be the Restrictive Period,
Territory and/or scope of activity restricted under this Agreement.
11. Addresses for
Notices. Any notice contemplated, required, or permitted under
this Agreement shall be sufficient if in writing and shall be deemed given when
delivered personally or mailed by registered or certified mail, return receipt
requested, to the addresses listed below:
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(a)
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To
Corporation:
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Attn:
Global Axcess Board of Directors
0000
Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxxxxxxx,
XX 00000
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(b)
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To
Employee:
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Xxxxxxx
Xxxxxxxx
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0000 Xxx
Xxxxxx Xxxxxx
Xxxxxxxxxxxx Xxxxx, XX
00000
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or such
subsequent address(es) as the respective parties may hereafter by written notice
designate.
12. Governing Law,
Forum. This Agreement shall in all respects be governed by and
construed according to the laws of Florida. Any suit or other proceeding arising
out of or relating to this Agreement shall be instituted and maintained in the
state or federal courts sitting in Xxxxx County, Florida, absent written consent
of Corporation to the contrary. Employee expressly waives any
objections to such jurisdiction and venue and irrevocably consents and submits
to the personal and subject matter jurisdiction of such courts in any such
action or proceeding.
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13. Compliance with Code Section
409A. It is intended that the terms of this Agreement,
including any ambiguous terms, be interpreted in a manner consistent with
Section 409A. It is also intended that, for all purposes,
“termination of employment” (or similar terms) as used herein shall mean
“separation from service” (within the meaning provided by Treasury Regulation
Section 1.409A-1(h)) in accordance with Treasury Regulation Section
1.409A-3(a)(1). Any provision that would cause this Agreement, or any
payment hereunder, to fail to satisfy Section 409A shall have no force or effect
until amended to comply with Section 409A, which amendment may be retroactive to
the extent permitted by Section 409A. The direct payment or
reimbursement of expenses permitted under this Agreement or otherwise shall be
made no later than the last day of Employee’s taxable year following the taxable
year in which such expense was incurred. Notwithstanding anything
herein to the contrary, in no event shall Corporation be liable to Employee for,
or with respect to, any taxes, penalties, or interest which may be imposed upon
you pursuant to Section 409A.
If it is
determined that (a) Employee is a “specified employee,” as defined in Section
409A(a)(2)(B)(i) and the regulations and other guidance promulgated thereunder,
and any elections made by Employee in accordance therewith, and (b) such
payments constitute a distribution of deferred compensation (within the meaning
of Treasury Regulation Section 1.409A-1(b)) upon separation from service (within
the meaning of Treasury Regulation Section 1.409A-1(h)), after taking into
account all available exemptions, then notwithstanding the timing of payment
provided in any other Paragraph of this Agreement, no payment, distribution, or
benefit under this Agreement that constitutes a distribution of deferred
compensation and that would otherwise be payable during the six (6) month period
after Employee’s termination of employment, will be made during such six (6)
month period, and any such payment, distribution or benefit will instead be paid
on the first business day after such six (6) month period.
14. Successors, Heirs and
Assigns. The rights and obligations of Employee under this
Agreement shall inure to the benefit of Corporation, its successors and assigns,
and shall be binding upon Employee and his respective successors, heirs and
permitted assigns. Corporation shall have the right to assign,
transfer, or convey this Agreement to its affiliated companies, successor
entities, or assignees or transferees of substantially all of Corporation’s
business activities. This Agreement, being personal in nature to
Employee, may not be assigned by Employee without Corporation’s prior written
consent.
15. Entire Agreement;
Amendment. Except as otherwise provided in this Paragraph,
this Agreement contains the entire agreement of the parties hereto, and may not
be changed or amended orally, but only by an agreement in writing expressly
purporting to amend this Agreement signed by both parties hereto; provided,
however, to the extent the Restrictive Covenants shall be determined to be
unenforceable for any reason, then such Restrictive Covenants shall be deemed to
be in addition to, and not in lieu of, any similar obligations or restrictions
to which Employee may be subject under the terms of any prior agreement with
Employer.
IN WITNESS WHEREOF, the
parties hereto have executed this Agreement under seal, as is their intention,
as of the day and year first above written.
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By: Xxxxxx
XxXxxxx
Title:
President & CEO
/s/
Xxxxxx
XxXxxxx
Signature
/s/
Xxxxxxx X.
Xxxxxxxx
Xxxxxxx
Xxxxxxxx’x Signature
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Schedule
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COMPENSATION
Salary
& Benefits
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1.
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Employee
shall receive a base salary at the rate of $170,000
per year, payable in accordance with Corporation’s regular payroll
practices as such practices may exist from time to
time.
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2.
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Employee
shall be eligible to participate in Corporation’s benefit plans on such
terms as may be established for Employee from time to
time.
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