Exhibit 10.28
EMPLOYMENT AGREEMENT
This Agreement, dated as of October 1, 2005 (the "Effective Date"), is
between Xxxxx X. Xxxxxx (the "Executive"), SuperStock Inc., a corporation formed
under the laws of the State of Florida (the "Company") and a21, Inc., a
corporation formed under the laws of the State of Texas ("a21").
W I T N E S S E T H:
WHEREAS, the Company desires to employ the Executive, and the Executive
is willing to render services to the Company, on the terms and subject to the
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants, agreements and promises hereinafter set forth, the parties hereto
covenant and agree as follows:
1. EMPLOYMENT. The Company shall employ the Executive as its Executive
Vice President and as an Executive of a21 with such title as may be mutually
agreed upon by the Executive and a21, and the Executive hereby accepts such
employment upon the terms and subject to the conditions hereinafter set forth,
commencing on the Effective Date and continuing until terminated pursuant to
Paragraph 4 hereof (the "Employment Period").
2. DUTIES.
(a) The Executive shall report to the Company's Board of Directors
(the "Board") through its Chief Executive Officer and a21's Board of Directors
(the "a21 Board") through its Chief Executive Officer. The Executive shall
perform and discharge diligently and faithfully such duties as may be assigned
to her from time to time by the Company's Board and the a21 Board as are
customary for the position of Executive Vice President. The Executive shall be
based in the Jacksonville, Florida metropolitan area, but her position will
require reasonable travel outside of such area.
(b) The Executive shall devote her full business time, attention,
skills and energies to the performance of her duties hereunder and to the
promotion of the business of the Company, consistent with such duties, and shall
not during the Employment Period be employed or engaged in any other business
activity, whether or not such activity is pursued for gain, profit or other
pecuniary advantage; provided, however, that this shall not be construed as
preventing the Executive from i) investing her personal assets in businesses
which do not compete with the Company, except as described in Paragraph 7(b),
ii) engaging in not-for-profit and civic activities that do not interfere with
the Executive's duties, or iii) investing in publicly traded securities of any
company as long as Executive is not an affiliate, as defined by applicable
securities laws, in a competitor; provided, however, that the foregoing shall
not be construed as precluding the Executive's spouse from pursuing any business
activities.
3. COMPENSATION.
(a) Salary. For services rendered by the Executive hereunder during
the Employment Period, the Company shall pay her a base salary (the "Salary") at
the annual gross rate of One Hundred Ten Thousand Dollars ($110,000). The Salary
shall increase to One Hundred Twenty Thousand Dollars ($120,000) as of November
1, 2005. An employment review will take place on an annual basis. Any increases
in the Salary rate shall be determined by the Chief Executive Officers of the
Company and a21 after the employment review.
(b) Bonus. On the Effective Date, a21 shall pay the Executive
additional compensation in the form of a bonus (the "Bonus") of 175,000 common
shares of a21. The common shares shall be issued upon signing this Agreement,
but shall vest in equal portions on each of November 1, 2005, February 28, 2006,
August 31, 2006 and February 28, 2007. In addition, during the Employment
Period, the Executive is eligible to receive an additional bonus (the
"Additional Bonus") the amount of which, if any, shall be determined solely and
in the good faith judgment of the Company, taking into consideration and giving
equal weight to (i) the Executive's performance, and (ii) the performance of the
Company. Additional Bonuses shall be determined on an annual basis or otherwise
as determined by the Chief Executive Officers of the Company and a21 and are
subject to the Company's ordinary payroll practices and may be paid in cash and
nonqualified stock options or restricted common shares of a21. The entire Bonus
and any Additional Bonus shall immediately vest upon a change in control of a21.
Notwithstanding anything contained in this Agreement to the contrary, any
unvested common shares may be repurchased by the Company for $.01 per common
share (with customary adjustments for splits etc.) within 30 days after the end
of the Employment Period.
(c) Stock Options. Subject to final approval of the Board of
Directors of a21, the Executive shall be entitled to receive, as soon as
practicable following the Effective Date, nonqualified stock options in
accordance with the terms of the a21 stock option plan and the standard stock
option agreement thereunder; provided, however, that such options shall provide
the Executive with the right to purchase 300,000 common shares of a21 at a
purchase price of $.30 per common share which shall vest in equal portions on
each of November 1, 2005, February 28, 2006, August 31, 2006 and February 28,
2007. All options shall immediately vest upon a change in control.
(d) Benefits. During the Employment Period, the Company shall
provide the Executive with any medical insurance, 401(k), pension, vacation or
other employee benefits made available to similarly situated executives of the
Company from time to time in accordance with the terms of the Company's standard
benefits plans and policies. Notwithstanding the foregoing, the Executive will
receive four (4) weeks vacation per year.
(e) Expense Reimbursement. The Executive is authorized to incur
reasonable expenses related to the performance of her duties under this
Agreement in accordance with budgets and guidelines established by the Company
from time to time or otherwise approved by the Chief Executive Officer of the
Company. The Company shall promptly reimburse the Executive for all such
expenses in accordance with its expense reimbursement policy in effect from time
to time.
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(f) Taxes. All payments and benefits provided to the Executive
hereunder shall be reported as taxable income to the extent required by law and
shall be subject to applicable income and payroll withholding taxes.
4. TERM AND TERMINATION.
(a) The term of this Agreement (the "Employment Period") shall
commence on the Effective Date and continue for thirty-six (36) months unless
terminated earlier in accordance with this Paragraph 4.
(b) Termination Without Cause. Either party hereto may terminate
this Agreement and the Executive's employment for any reason at any time during
the Employment Period, effective upon sixty (60) days written notice to the
other party. In the event the Company terminates this Agreement and the
Executive's employment without Cause (as hereinafter defined), the Company shall
pay to the Executive (i) any unpaid Salary accrued as of the date of
termination, (ii) any unused vacation days accrued as of the date of
termination, and (iii) the lesser of 1) the Salary due under any remaining term
of this Agreement, and 2) the Salary due for a period of six(6) months following
the end of the Employment Period - in either case in installments in accordance
with the Company's ordinary payroll practices. In addition, solely for purposes
of determining the portion of any Bonus or Additional Bonus awarded to the
Executive under Paragraph 3(b) and Stock Options under Paragraph 3(c) that has
vested, the shares or options that would have vested on the vesting date next
succeeding the date of termination of employment, but for the termination
without Cause, shall be vested as of the date of the termination of Executive's
employment. The Executive shall not be entitled to any further payments or
benefits except as required by any federal or state law requiring continuation
of benefits and except as may be provided in any stock option agreement.
(c) Termination for Cause. The Company may terminate this Agreement
and the Executive's employment for Cause (as hereinafter defined) at any time,
effective immediately upon giving the Executive written notice of such
termination. As used herein, the term "Cause" shall mean any of the following
events:
(i) the Executive's conviction of or plea of guilty or nolo
contendere, or no contest to a misdemeanor involving moral turpitude (which is
likely to have an adverse effect on the Company or the Executive's ability to
perform her duties hereunder) or a felony which may result in a term of
imprisonment;
(ii) the Executive's breach of this Agreement or willful failure
to carry out the lawful directives of the Board or the a21 Board consistent with
Paragraph 2(a) hereof (provided the Company has given the Employee advance
written notice specifying the nature of such breach or failure to carry out the
lawful directives of the Board or the a21 Board and a period of at least fifteen
(15) days to cure such breach or failure); or
(iii) the Executive's (A) willful gross misconduct, including,
without limitation, dishonesty, fraud or theft, or (B) willful bad faith act or
failure to act that is injurious to the business or reputation of the Company.
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In the event of termination for Cause, the Company shall pay to the
Executive any unpaid Salary and any unused vacation days accrued as of the date
of termination, and the Executive shall not be entitled to any further payments
or benefits except as required by any federal or state law requiring
continuation of benefits and except as may be provided in any stock option
agreement, as the case may be.
(d) Death. If the Executive dies during the Employment Period, this
Agreement and the Executive's employment shall terminate as of the date of her
death. The Company shall pay to the Executive's estate any unpaid Salary and any
unused vacation days accrued as of the date of termination, and the Executive's
estate shall not be entitled to any further payments or benefits pursuant to
Paragraph 3 except as required by any federal or state law requiring
continuation of benefits and except as may be provided in any stock option
agreement, as the case may be.
(e) Disability. If the Executive is incapacitated by accident, sickness
or otherwise so as to render her mentally or physically incapable of performing
the services required of her under this Agreement (referred to herein as a
"Disability") for (i) a period of ninety (90) consecutive days or (ii) for an
aggregate of one hundred twenty (120) business days during any twelve (12) month
period, the Company may terminate this Agreement and the Executive's employment
effective immediately after the expiration of either of such periods, upon
giving the Executive written notice of such termination. Notwithstanding the
foregoing provision, if it is determined by the Company that the Executive has a
"disability" as defined under the Americans with Disabilities Act, the
Executive's employment shall not be terminated on the basis of such disability
unless it is first determined by the Company after consultation with the
Executive that there is no reasonable accommodation which would permit the
Executive to perform the essential functions of her position without imposing an
undue hardship on the Company.
In the event the Executive is determined to have a Disability hereunder
and receives payments under any disability plan maintained by the Company for
its employees or under any other arrangement maintained by the Company for the
Executive, such payments shall reduce and offset any Salary payable to the
Executive pursuant to Paragraph 3 hereof, to extent permitted under such plan or
arrangement. In the event of termination pursuant to this Subparagraph 4(e), the
Company shall pay to the Executive (i) any unpaid Salary accrued as of the date
of termination, and (ii) any unused vacation days accrued as of the date of
termination, and the Executive shall not be entitled to any further payments or
benefits pursuant to Paragraph 3 except as required by any federal or state law
requiring continuation of benefits and except as may be provided in any stock
option agreement, as the case may be.
5. NON-SOLICITATION.
(a) Non-Solicitation of Employees. The Executive hereby agrees that
during the Employment Period and for a period of one (1) year thereafter (the
"Survival Period"), she shall not, directly or indirectly through any other
individual, person or entity, employ, solicit, persuade or induce any
individual, other than Executive's spouse, who is, or was at any time during the
last twelve (12) months of the Executive's employment by the Company, an
employee of the Company to terminate or refrain from renewing or extending her
or her employment by the Company or to become employed by or enter into a
contractual relationship with the Executive or any other individual, person or
entity. For the purposes of Paragraphs 5, 6 and 7 of this Agreement the
"Company" shall be deemed to include the Company and each of its Affiliates. For
the purposes hereof, Affiliates shall mean with respect to any person, any
person directly or indirectly controlling, controlled by, or under common
control with, such other person at any time during the period for which the
determination of affiliation is being made.
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(b) Non-Solicitation of Suppliers or Vendors. The Executive hereby
agrees that during the Employment Period and the Survival Period he shall not,
directly or indirectly through any other individual, person or entity, solicit,
persuade or induce any individual, person or entity which is, or at any time
during the Employment Period was, a supplier of any product or service to the
Company, or vendor of the Company (whether as a distributor, agent, commission
agent, employee or otherwise), to terminate, reduce or refrain from renewing or
extending his, her or its contractual or other relationship with the Company.
(c) Non-Solicitation of Customers. The Executive hereby agrees that
during the Employment Period and the Survival Period he shall not, directly or
indirectly through any other individual, person or entity, solicit, persuade or
induce any individual, person or entity which is, or at any time during the
Employment Period was, a customer of the Company to terminate, reduce or refrain
from renewing or extending its contractual or other relationship with the
Company in regard to the purchase of products or services manufactured, marketed
or sold by the Company, or to become a customer of or enter into any contractual
or other relationship with the Executive or any other individual, person or
entity in regard to the purchase of products or services similar or identical to
those manufactured, marketed or sold by the Company.
6. CONFIDENTIALITY.
The Executive agrees that during the Employment Period, and thereafter,
he shall not divulge to anyone, other than as necessary in the performance of
her duties hereunder or as required by law or legal process, confidential
information of the Company, its affiliates or its customers, including, without
limitation, know-how, trade secrets, customer lists, costs, profits or margin
information, markets, sales, pricing policies, operational methods, plans for
future development, data, drawings, samples, processes or products and other
information disclosed to the Executive or known by her as a result of or through
her employment by the Company, which is not generally known in the businesses in
which the Company is engaged and which relates directly or indirectly to the
Company's products or services or which is directly or indirectly useful in any
aspect of the Company's business. In the event the Company is bound by a
confidentiality agreement with a customer, supplier or other party regarding the
confidential information of such customer, supplier or other party, which
provides greater protection than specified above in this Paragraph 6, the
provisions of such other confidentiality agreement shall be binding upon the
Executive and shall not be superseded by this Paragraph 6. Upon the termination
of the Executive's employment hereunder or at any other time upon the Company's
request, the Executive shall deliver forthwith to the Company all memoranda,
notes, records, reports, computer disks and other documents (including all
copies thereof) containing such confidential information.
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7. NON-COMPETITION.
(a) The Executive hereby agrees that, except as described under
Paragraph 7(b), during the Employment Period and the Survival Period, the
Executive shall not, directly or indirectly, anywhere in the entire United
States, own, manage, operate, control or participate in the ownership,
management, operation or control of, or be connected as an officer, employee,
partner, director, independent contractor or in any other capacity with, or have
any financial interest in, or aid or assist anyone else in the manufacture, sale
or representation of products or the provision of services identical or similar
to the products and services manufactured, sold, represented or provided by the
Company, and which products or services are marketed to the same customer base
as the products or services offered by the Company, at any time during the
Employment Period or the Survival Period, or which are included in any business
plans of the Company in existence and under consideration at the time of
termination and of which Executive was aware.
(b) Exception for Business Activities of Executive's Spouse. The
Executive shall not be prevented from investing her personal assets, whether
held jointly or individually, as a passive interest in any of the Executive
Spouse's business activities, or from safeguarding those investments, whether or
not the Executive Spouse's business activities are considered to be in
competition with the Company. Such passive investment by the Executive shall not
in and of itself be construed as a breach of any part of this Agreement,
provided that it does not interfere with the performance of the Executive's
duties and that the Executive does not violate any of the provisions of this
Agreement.
8. REMEDIES. The Executive acknowledges and agrees that the Company's
remedy at law for a breach or threatened breach of any of the provisions of
Paragraphs 5, 6 or 7 of this Agreement would be inadequate and, in recognition
of that fact, in the event of a breach or threatened breach by the Executive
of any of the provisions of Paragraphs 5, 6 or 7 of this Agreement, it is
agreed that in addition to its remedy at law, the Company shall be entitled to
appropriate equitable relief in the form of specific performance, preliminary
or permanent injunction, temporary restraining order or any other appropriate
equitable remedy which may then be available. Notwithstanding any provision of
this Agreement to the contrary, it is expressly understood and agreed that,
although the Executive and the Company consider the restrictions contained in
Paragraphs 5, 6 and 7 to be reasonable for the purpose of preserving the
Company's goodwill and other proprietary rights, if a final judicial
determination is made by a court having jurisdiction that the time and scope of
the restrictions in such Paragraphs is an unreasonable or otherwise
unenforceable restriction against the Executive, the provisions of such
Paragraphs shall not be rendered void but shall be deemed amended to apply as to
the maximum time and scope permitted and to such other extent as the court may
determine to be reasonable.
9. REPRESENTATION/WARRANTY. The Executive represents and warrants
that he is not bound by the terms of a confidentiality agreement or
non-competition agreement or any other agreement with a former employer or other
third party which would preclude her from accepting employment by the Company or
which would preclude her from effectively performing her duties for the Company.
The Company represents and warrants that it has all requisite corporate power
and authority to consummate the transactions contemplated by this Agreement and
that this Agreement is binding on the Company and enforceable against the
Company in accordance with its terms.
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10. NOTICES. Any notices or other communications required to be
given pursuant to this Agreement shall be in writing and shall be deemed given:
(i) upon delivery, if by hand; (ii) after two (2) business days if sent by
express mail or air courier; (iii) four (4) business days after being mailed
(seven (7) business days for international mailings), if sent by registered or
certified mail, postage prepaid, return receipt requested; or (iv) upon
transmission, if sent by facsimile (provided that a confirmation copy is sent in
the manner provided in clause (ii) or clause (iii) of this Paragraph 10 within
thirty-six (36) hours after such transmission), except that if notice is
received by facsimile after 5:00 p.m. on a business day at the place of receipt,
it shall be effective as of the following business day. All communications
hereunder shall be delivered to the respective parties at the following
addresses:
If to the Company or a21:
0000 Xxxxxxxxx Xxxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: Chairman, Board of Directors
with a copy to:
Loeb & Loeb LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxxxxx, Esq.
If to the Executive:
Xxxxx X. Xxxxxx
[use home address]
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
11. GOVERNING LAW/JURISDICTION. This Agreement shall be governed by
and construed in accordance with the law of the State of Florida, regardless of
the law that might otherwise govern under applicable principles of conflicts of
laws thereof. The parties hereto hereby irrevocably consent to the exclusive
jurisdiction of the state or federal courts sitting in Jacksonville, Florida in
connection with any controversy or claim arising out of or relating to this
Agreement, or the negotiation or breach thereof, and hereby waive any claim or
defense that such forum is inconvenient or otherwise improper. Each party hereby
agrees that any such court shall have in personam jurisdiction over it and
consents to service of process in any matter authorized by Florida law.
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12. SEVERABILITY. Whenever possible, each provision or portion of any
provision of this Agreement shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision or portion of any
provision of this Agreement is found to be invalid or unenforceable in any
respect under any applicable law or rule in any jurisdiction, such finding or
construction shall not affect the remainder of the provisions of this Agreement,
which shall be given full force and effect without regard to the invalid or
unenforceable provision, and such invalid or unenforceable provision shall be
modified automatically to the least extent possible in order to render such
provision valid and enforceable, but only if the provision as so modified
remains consistent with the parties' original intent.
13. WAIVER OF BREACH. The waiver by either party hereto of a breach
of any provision of this Agreement by the other party shall not operate or be
construed as a waiver of any subsequent breach.
14. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective heirs,
successors, representatives and assigns. This Agreement is assignable to any
legal successor of the Company. This Agreement may not be assigned by the
Executive.
15. ENTIRE AGREEMENT. This Agreement constitutes the entire
understanding and agreement between the Company and the Executive with regard to
all matters contained herein and incorporates and supersedes all prior
agreements between the parties concerning the employment of the Executive by the
Company. There are no other agreements, conditions or representations, oral or
written, express or implied, with regard thereto. This Agreement may be amended
only in writing, signed by both parties.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set
forth above.
SUPERSTOCK, INC. EXECUTIVE
By: /s/ Xxxxxx X. Xxxxx /s/ Xxxxx X. Xxxxxx
------------------------------- ---------------------------------
Name: Xxxxxx X. Xxxxx Xxxxx X. Xxxxxx
Title: Chief Executive Officer
a21, INC.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Executive Officer
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