EMPLOYMENT AGREEMENT, dated as of February 25, 1999, by and
between DCAP GROUP, INC. (formerly EXTECH Corporation), a Delaware corporation
(the "Company"), and XXXXXXX XXXXXXXXX (the "Employee").
RECITALS
WHEREAS, the Company and the Employee desire to enter into an
employment agreement which will set forth the terms and conditions upon which
the Employee shall be employed by the Company and upon which the Company shall
compensate the Employee.
NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants hereinafter set forth, the parties hereto have agreed, and do
hereby agree, as follows:
1. EMPLOYMENT; TERM
1.1 (a) The Company will employ the Employee in its business,
and the Employee will work for the Company therein, as its Executive Vice
President for a term commencing as of the date hereof and terminating on the
fifth anniversary of the date hereof (the "Fifth Anniversary Date") (the
"Initial Term"), except that the term of this Agreement shall continue for an
additional three (3) years (the "Extended Term") unless, at least ninety (90)
days prior to the Fifth Anniversary Date, the Company, by vote of at least
seventy-five percent (75%) of all of the members of its Board of Directors
(including, for purposes of determining the number of members of the Board, the
Employee, if a member), notifies the Employee of its desire not to extend the
term of this Agreement (the "Non-Extension Notice"). The term of this Agreement,
as it may be extended, is hereinafter referred to as the "Employment Period".
(b) The Employee's employment may be terminated by
the Company at any time during the Employment Period upon written notice for
"cause". The Company agrees that it will not terminate the Employee's employment
for "cause" unless a majority of all of the members of its Board of Directors
(including, for purposes of determining the number of members of the Board, the
Employee, if a member) shall have approved such action. The Company agrees that
it will not terminate the Employee's employement other than for "cause" unless
at least seventy-five percent (75%) of all of the members of the Board of
Directors (including, for purposes of determining the number of members of the
Board, the Employee, if a member) shall have approved such action. As used in
this Agreement, "cause" shall mean the Employee's commission of any act in the
performance of his duties constituting common law fraud, a felony or other gross
malfeasance of duty, the Employee's commission of any act involving moral
turpitude, any material misrepresentation by the Employee (including, without
limitation, a breach of any representation set forth in Paragraph 13.1 hereof),
any breach of any material covenant on the Employee's part herein set forth, or
the Employee's engagement in misconduct which is materially injurious to the
Company or its subsidiaries.
1.2 Unless sooner terminated as provided for in this
Agreement, at the end of the Employment Period (the "Expiration Date"), the
Employee's employment with the Company shall terminate. Upon termination of the
Employee's employment with the Company for any reason whatsoever, he shall be
deemed to have resigned his positions as an officer and director of the Company
and as an employee, officer and director of each of the Company's subsidiaries.
2. DUTIES
2.1 During the Employment Period, the Employee shall serve as
the Company's Executive Vice President and shall perform duties of an executive
character consisting of administrative and managerial responsibilities on behalf
of the Company and such further duties of an executive character as shall, from
time to time, be delegated or assigned to him by the Board of Directors of the
Company consistent with the Employee's position.
3. DEVOTION OF TIME
3.1 During the Employment Period, the Employee shall expend
all of his working time for the Company; shall devote his best efforts, energy
and skill to the services of the Company and the promotion of its interests; and
shall not take part in activities detrimental to the best interests of the
Company.
4. COMPENSATION; LOANS
4.1 For all services to be rendered by the Employee during the
Employment Period and in consideration of the Employee's representations and
covenants set forth in this Agreement, the Employee shall be entitled to receive
from the Company compensation as set forth herein. The Employee acknowledges and
agrees that, notwithstanding the provisions of this Agreement, his compensation
hereunder is subject to reduction as provided for in a certain Agreement, dated
as of May 8, 1998, by and among the Company and the Employee, among others (the
"Acquisition Agreement"), and a certain letter agreement of even date between
the Company and the Employee, with regard to particular Joint Ventures with
respect to which the provisions of Schedule 8 to the Acquisition Agreement are
applicable.
4.2 During the Employment Period, the Employee shall be
entitled to receive a salary at the rate of $250,000 per annum. The Employee
shall be entitled to such additional compensation as shall be determined from
time to time by the Board of Directors of the Company in its sole discretion.
All amounts due hereunder shall be payable in accordance with the Company's
standard payroll practices.
4.3 From time to time during each of the five (5) twelve (12)
month periods of the Initial Term, within ten (10) days following receipt of
written request from the Employee, the Company will loan to the Employee up to
$20,000 (up to $100,000 in the aggregate) (collectively, the "Loans"); provided,
however, that the Company's obligation to make each such Loan shall be subject
to the condition that, at the time the particular Loan is to be made, the
Employee is in the employ of the Company. Each Loan will be evidenced by a
promissory note of the Employee in the principal amount thereof (collectively,
the "Notes") that will provide for, among other things, the following:
(i) interest at a rate per annum equal to the
"prime rate" (as reported in the Wall Street Journal) in effect as of the date
each Loan is made; and
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(ii) payment of the principal amount thereof,
together with accrued interest thereon, in four (4) equal annual installments
commencing one (1) year from the date of each Loan and continuing on the
anniversary day of the date thereof of each subsequent year, in such annual
amount as shall be necessary to self-amortize the Note at the end of such four
(4) year period (provided, however, that no payments shall be due later than the
seventh anniversary of the date hereof), subject to acceleration to the extent
the Employee receives any proceeds from the sale or other disposition of any
shares of Common Stock of the Company;
The Notes shall be in, or substantially in, the form of
Exhibit 4.3(a) attached hereto.
The repayment of all amounts due under each Note shall be
secured by the pledge by the Employee, pursuant to a pledge agreement that will
be entered into at the time of each Loan (the "Pledge Agreement"), of five (5)
Common Shares of the Company for each one dollar ($1) loaned.
The Pledge Agreement shall be in, or substantially in, the
form of Exhibit 4.3(b) attached hereto.
4.4 In the event Pre-Tax Net Income (as hereinafter defined)
for any fiscal year falling entirely within the Employment Period (but not
before the fiscal year ending December 31, 2000 and not after the fiscal year
ending December 31, 2005) is at least $100,000, the Employee shall be entitled
to receive a bonus in the amount of $37,500 (a "Bonus").
4.5 For purposes hereof, the term "Pre-Tax Net Income" for any
particular fiscal year shall mean the consolidated net income before all taxes
of the Company for such fiscal year determined in accordance with generally
accepted accounting principles consistently applied, as audited and reported
upon by the Company's then independent certified public accountants.
4.6 Any Bonus payable pursuant to the provisions hereof shall
be paid on April 15 following the particular fiscal year.
4.7 Notwithstanding anything herein to the contrary, (a) the
Company shall not be obligated to pay any Bonus to the Employee for a particular
fiscal year if, at the time the particular Bonus would be otherwise payable, no
amounts are payable by the Employee to the Company pursuant to his Additional
Shares Note (as such term is defined in the Acquisition Agreement), and (b) if
any amounts are then payable by the Employee pursuant to his Additional Shares
Note, (i) the amount of the Bonus shall not exceed the amount then payable
pursuant to his Additional Shares Note; and (ii) the Company may offset against
the Bonus any amount then payable by the Employee pursuant to his Additional
Shares Note.
5. AUTOMOBILE ALLOWANCE; REIMBURSEMENT OF EXPENSES
5.1 The Employee shall be entitled to the use of a
Company-leased automobile (the "Company Car") during the Employment Period for
business purposes. In no event shall the Company's lease obligations with
respect to the Company Car exceed $1,200 per month. The
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Company shall be responsible for all insurance premiums with respect to the
Company Car (not to exceed $3,000 per year) as well as all expenses for
gasoline, maintenance and repairs with respect thereto. The Employee
acknowledges and agrees that under no circumstances shall the foregoing
provisions create any implication that the Company shall be liable for, or that
the Employee shall be entitled to reimbursement with respect to, any other
insurance premiums, including, without limitation, any life insurance premiums
or premiums with respect to any insurance for any automobile other than the
Company Car, or with respect to any country club or similar membership. The
Employee acknowledges and agrees further that, until sold or otherwise disposed
of, the Company-owned boat shall be used by the Employee solely for business
purposes.
5.2 The Company shall pay directly, or reimburse the Employee
for, all other reasonable and necessary expenses and disbursements incurred by
the Employee for and on behalf of the Company in the performance of his duties
during the Employment Period, including, without limitation, reasonable and
necessary expenses incurred by the Employee for and on behalf of the Company in
the performance of his duties during the Employment Period for (a) client
entertainment and the use of a cellular telephone and beeper, and (b) food,
lodging and transportation if he is required to perform any of his duties away
from his primary place of residence.
5.3 The Employee shall submit to the Company, not less than
once in each calendar month, reports of such expenses and other disbursements in
form normally used by the Company and receipts with respect thereto and the
Company's obligations under Paragraphs 5.1 and 5.2 hereof shall be subject to
compliance therewith.
6. DISABILITY; INSURANCE
6.1 If, during the Employment Period, the Employee, in the
opinion of a majority of all of the members of the Board of Directors of the
Company (excluding the Employee), as confirmed by competent medical evidence,
shall become physically or mentally incapacitated to perform his duties for the
Company hereunder ("Disabled") for a continuous period, then for the first six
(6) months of such period he shall receive his full salary. In no event,
however, shall the Employee be entitled to receive any payments under this
Paragraph 6.1 beyond the expiration or termination date of this Agreement.
Effective with the date of his resumption of full employment, the Employee shall
be re-entitled to receive his full salary. If such illness or other incapacity
shall endure for a continuous period of at least nine (9) months or for at least
two hundred fifty (250) business days during any eighteen (18) month period, the
Company shall have the right, by written notice, to terminate the Employee's
employment hereunder as of a date (not less than thirty (30) days after the date
of the sending of such notice) to be specified in such notice. The Employee
agrees to submit himself for appropriate medical examination to a physician of
the Company's designation as necessary for purposes of this Paragraph 6.1.
6.2 The obligations of the Company under this Paragraph 6 may
be satisfied, in whole or in part, by payments to the Employee under disability
insurance provided by the Company.
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6.3 Notwithstanding the foregoing, in the event, at the time
of any apparent incapacity, the Company has in effect a disability policy with
respect to the Employee (or, if not with respect to the Employee, then with
respect to any executive officer of the Company), the Employee shall be
considered Disabled for purposes of Paragraph 6.1 only if he is (or the
executive officer, had he had the apparent incapacity, would be) considered
disabled for purposes of the policy.
6.4 The Company agrees to obtain a disability insurance policy
on behalf of the Employee (subject to the Employee's satisfying any requirements
therefor) and maintain such policy in effect during the Employment Period. In no
event shall the Company be liable for premiums in excess of $6,500 per annum
with respect thereto.
7. RESTRICTIVE COVENANTS
7.1 The services of the Employee are unique and extraordinary
and essential to the business of the Company, especially since the Employee
shall have access to the Company's customer lists, trade secrets and other
privileged and confidential information essential to the Company's business.
Therefore, the Employee agrees that, if the term of his employment hereunder
shall expire or his employment shall at any time terminate for any reason
whatsoever, with or without cause, the Employee will not at any time within two
(2) years after such expiration or termination (the "Restrictive Covenant
Period"), without the prior written consent of the Company (which consent shall
require the approval of the Board of Directors of the Company), directly or
indirectly, anywhere within five (5) miles of the location of any office of the
Company or any franchisee thereof at the date of expiration or termination,
whether individually or as a principal, officer, employee, partner, member,
manager, director, agent of, or consultant or independent contractor to, any
entity, (i) engage or participate in a business which, as of such expiration or
termination date, is similar to or competitive with, directly or indirectly,
that of the Company and shall not make any investments in any such similar or
competitive entity, except that the foregoing shall not restrict the Employee
from acquiring up to one percent (1%) of the outstanding voting stock of any
entity whose securities are listed on a stock exchange or Nasdaq; (ii) cause or
seek to persuade any director, officer, employee, customer, client, account,
agent or supplier of, or consultant or independent contractor to, the Company,
or others with whom the Company has a business relationship (collectively
"Business Associates"), to discontinue or materially modify the status,
employment or relationship of such person or entity with the Company, or to
become employed in any activity similar to or competitive with the activities of
the Company; (iii) cause or seek to persuade any prospective customer, client,
account or other Business Associate of the Company (which at or about the date
of cessation of the Employee's employment with the Company was then actively
being solicited by the Company) to determine not to enter into a business
relationship with the Company or to materially modify its contemplated business
relationship; (iv) hire, retain or associate in a business relationship with,
directly or indirectly, any director, officer or employee of the Company; or (v)
solicit or cause or authorize to be solicited, or accept, for or on behalf of
him or any third party, any business from, or the entering into of a business
relationship with, (a) others who are, or were within one (l) year prior to the
cessation of his employment with the Company, a customer, client, account or
other Business Associate of the Company, or (b) any prospective
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customer, client, account or other Business Associate of the Company which at or
about the date of such cessation was then actively being solicited by the
Company. The foregoing restrictions set forth in this Paragraph 7.1 shall apply
likewise during the Employment Period. Notwithstanding the foregoing, (x) in the
event the Employee is entitled to receive the Severance Amount (as hereinafter
defined) or his employment is terminated by the Company without cause, then the
obligations under this Paragraph 7.1 shall terminate in the event the Company
defaults in its obligation to make any payments provided for in Paragraph 11.2
or 11.3 hereof and such default continues for a period of twenty (20) days
following receipt by the Company of written notice thereof from the Employee;
and (y) the provisions of this Paragraph 7.1 shall cease to apply in the event
(I) this Agreement is terminated pursuant to the provisions of Paragraph 11.1(a)
hereof or (II) (A) the term of this Agreement is extended for the Extended Term;
(B) prior to the expiration of the Extended Term (the "Extended Expiration
Date"), the Employee is not offered by the Company a further two (2) year
extension of the term of this Agreement at an annual base salary at least equal
to his annual base salary in effect at the Extended Expiration Date and
otherwise substantially upon the terms set forth herein (except for any loans
and bonuses provided for herein); (C) prior to the Extended Expiration Date, the
Employee's employment with the Company is not terminated in accordance with the
provisions of Paragraph 11.1(b) hereof and he does not voluntarily terminate his
employment with the Company; and (D) the Employee's employment with the Company
terminates on the Extended Expiration Date.
7.2 The Employee agrees to disclose promptly in writing to the
Board of Directors of the Company all ideas, processes, methods, devices,
business concepts, inventions, improvements, discoveries, know-how and other
creative achievements (hereinafter referred to collectively as "discoveries"),
whether or not the same or any part thereof is capable of being patented,
trademarked, copyrighted, or otherwise protected, which the Employee, while
employed by the Company, conceives, makes, develops, acquires or reduces to
practice, whether acting alone or with others and whether during or after usual
working hours, and which are related to the Company's business or interests, or
are used or usable by the Company, or arise out of or in connection with the
duties performed by the Employee. The Employee hereby transfers and assigns to
the Company all right, title and interest in and to such discoveries (whether
conceived, made, developed, acquired or reduced to practice on or prior to the
date hereof or hereafter during his employment with the Company), including any
and all domestic and foreign copyrights and patent and trademark rights therein
and any renewals thereof. On request of the Company, the Employee will, without
any additional compensation, from time to time during, and after the expiration
or termination of, the Employment Period, execute such further instruments
(including, without limitation, applications for copyrights, patents, trademarks
and assignments thereof) and do all such other acts and things as may be deemed
necessary or desirable by the Company to protect and/or enforce its right in
respect of such discoveries. All expenses of filing or prosecuting any patent,
trademark or copyright application shall be borne by the Company, but the
Employee shall cooperate in filing and/or prosecuting any such application.
7.3 (a) The Employee represents that he has been informed that
it is the policy of the Company to maintain as secret all confidential
information relating to the Company,
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including, without limitation, any and all knowledge or information with respect
to secret or confidential methods, processes, plans, materials, customer lists
or data, or with respect to any other confidential or secret aspect of the
Company's activities, and further acknowledges that such confidential
information is of great value to the Company. The Employee recognizes that, by
reason of his employment with the Company, he will acquire confidential
information as aforesaid. The Employee confirms that it is reasonably necessary
to protect the Company's goodwill, and, accordingly, hereby agrees that he will
not, directly or indirectly (except where authorized by the Board of Directors
of the Company), at any time during the term of this Agreement or thereafter
divulge to any person, firm or other entity, or use, or cause or authorize any
person, firm or other entity to use, any such confidential information.
(b) The Employee agrees that he will not, at any
time, remove from the Company's premises any drawings, notebooks, software, data
or other confidential information relating to the business and procedures
heretofore or hereafter acquired, developed and/or used by the Company, except
where necessary in the fulfillment of his duties hereunder.
(c) The Employee agrees that, upon the
expiration or termination of this Agreement for any reason whatsoever, he shall
promptly deliver to the Company any and all drawings, notebooks, software, data
and other documents and material, including all copies thereof, in his
possession or under his control relating to any confidential information or
discoveries, or which is otherwise the property of the Company.
(d) For purposes hereof, the term "confidential
information" shall mean all information given to the Employee, directly or
indirectly, by the Company and all other information relating to the Company
otherwise acquired by the Employee during the course of his employment with the
Company (whether on or prior to the date hereof or hereafter), other than
information which (i) was in the public domain at the time furnished to, or
acquired by, the Employee, or (ii) thereafter enters the public domain other
than through disclosure, directly or indirectly, by the Employee or others in
violation of an agreement of confidentiality or nondisclosure.
7.4 For purposes of this Paragraph 7, the term "Company" shall
mean and include any and all subsidiaries and affiliated entities of the Company
in existence from time to time.
8. VACATIONS
8.1 The Employee shall be entitled to an aggregate of four (4)
weeks vacation time for each twelve (12) month period during the Employment
Period commencing on the date hereof, the time and duration thereof to be
determined by mutual agreement between the Employee and the Company.
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9. PARTICIPATION IN EMPLOYEE BENEFIT PLANS; STOCK OPTIONS
9.1 The Employee shall be accorded the right to participate in
and receive benefits under and in accordance with the provisions of any pension,
profit sharing, insurance, medical and dental insurance or reimbursement (with
family coverage) or other plan or program of the Company either in existence as
of the date hereof or hereafter adopted for the benefit generally of its
executive employees.
9.2 Concurrently with the execution hereof, pursuant to the
Company's 1998 Stock Option Plan and a Stock Option Agreement of even date, the
Company is granting to the Employee the right and option to purchase up to
200,000 Common Shares of the Company upon the following terms: (a) an expiration
date of five (5) years from the date hereof; (b) an exercise price equal to
$2.69 per share; and (c) vesting to the extent of one-half thereof on each of
the first and second anniversaries of the date hereof (the "Option").
10. SERVICE AS OFFICER OF SUBSIDIARIES; SERVICE AS DIRECTOR
10.1 During the Employment Period, the Employee shall, if
elected or appointed, serve as (a) an officer of any subsidiaries of the Company
in existence or hereafter created or acquired and (b) a director of the Company
and/or any such subsidiaries of the Company, in each case without any additional
compensation for such services.
11. EARLIER TERMINATION; PAYMENT FOLLOWING TERMINATION
11.1 The Employee's employment hereunder shall automatically
terminate upon his death and may terminate at the option of the Company in the
event of:
(a) the Employee's incapacity, as provided for
in Paragraph 6.l hereof; or
(b) "cause", as provided for in Paragraph 1.1
hereof.
Upon the termination of the Employee's employment, the Employment Period shall
be considered to have ended.
11.2 In the event of the following:
(a) the Company timely sends the Non-Extension
Notice to the Employee in accordance with the provisions of Paragraph 1.1
hereof;
(b) prior to the Fifth Anniversary Date, the
Employee's employment with the Company is not terminated in accordance with the
provisions of Paragraph 11 hereof and he does not voluntarily terminate his
employment with the Company; and
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(c) the Employee's employment with the Company
terminates on the Fifth Anniversary Date,
then, the Company shall continue to pay to the Employee his then annual base
salary for a period of two (2) years following the Fifth Anniversary Date (the
"Severance Amount"). The Severance Amount shall be payable in a manner
consistent with the payment to the Employee theretofore of his salary.
11.3 In the event of the termination of the Employee's
employment by the Company during the Employment Period without cause, as
liquidated damages, the Employee shall be entitled to receive an amount equal to
all compensation that he would have been entitled to receive for the remainder
of the Employment Period pursuant to Paragraph 4 hereof as if his employment had
not been terminated (the "Post-Termination Payments"). The Post-Termination
Payments shall be made in a manner consistent with the payment to the Employee
theretofore of his salary as if he had remained in the employ of the Company. In
the event the notice of termination of employment is given (a) prior to the
ninetieth (90th) day prior to the Fifth Anniversary Date or (b) subsequent to
such ninetieth (90th) day but after the date of any Non-Extension Notice timely
given, then, instead of any obligation to pay the Employee any amount with
regard to the Extended Term, the Employee shall be entitled to receive the
Severance Amount, payable, as provided for in Paragraph 11.2 hereof, following
the expiration of the Post-Termination Payments.
11.4 The Employee shall not be required to mitigate any
damages he may incur for any termination of employment by the Company without
cause by seeking other employment; however, any amounts paid or payable to the
Employee from other employment or other services shall reduce on a
dollar-for-dollar basis any amount otherwise payable to him pursuant to
Paragraph 11 hereof.
12. INJUNCTIVE RELIEF; REMEDIES
12.1 The Employee acknowledges and agrees that, in the event he
shall violate or threaten to violate any of the restrictions of Paragraph 3
(with regard to the last clause thereof) or 7 hereof, the Company will be
without an adequate remedy at law and will therefore be entitled to enforce such
restrictions by temporary or permanent injunctive or mandatory relief in any
court of competent jurisdiction without the necessity of proving damages.
12.2 The Employee agrees further that the Company shall have the
following additional rights and remedies:
(i) The right and remedy to require the Employee to
account for and pay over to the Company all profits derived or received by him
as the result of any transactions constituting a breach of any of the provisions
of Paragraph 7.1, and the Employee hereby agrees to account for and pay over
such profits to the Company; and
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(ii) The right to recover attorneys' fees incurred in
any action or proceeding in which it seeks to enforce its rights under Paragraph
7 hereof and is successful on any grounds.
12.3 Each of the rights and remedies enumerated above shall be
independent of the other, and shall be severally enforceable, and all of such
rights and remedies shall be in addition to, and not in lieu of, any other
rights and remedies available to the Company under law or in equity.
12.4 The parties hereto intend to and hereby confer jurisdiction
to enforce the covenants contained in Paragraph 7.1 upon the courts of any
jurisdiction within the geographical scope of such covenants (a "Jurisdiction").
In the event that the courts of any one or more of such Jurisdictions shall hold
such covenants unenforceable by reason of the breadth of their scope or
otherwise, it is the intention of the parties hereto that such determination not
bar or in any way affect the Company's right to the relief provided above in the
courts of any other Jurisdiction, as to breaches of such covenants in such other
respective Jurisdictions, the above covenants as they relate to each
Jurisdiction being, for this purpose, severable into diverse and independent
covenants.
13. NO RESTRICTIONS
13.l The Employee hereby represents that neither the execution
of this Agreement nor his performance hereunder will (a) violate, conflict with
or result in a breach of any provision of, or constitute a default (or an event
which, with notice or lapse of time or both, would constitute a default) under
the terms, conditions or provisions of any contract, agreement or other
instrument or obligation to which the Employee is a party, or by which he may be
bound, or (b) violate any order, judgment, writ, injunction or decree applicable
to the Employee. In the event of a breach hereof, in addition to the Company's
right to terminate this Agreement, the Employee shall indemnify the Company and
hold it harmless from and against any and all claims, losses, liabilities, costs
and expenses (including reasonable attorneys' fees) incurred or suffered in
connection with or as a result of the Company's entering into this Agreement or
employing the Employee hereunder.
14. ARBITRATION
14.1 Except with regard to Paragraph 12.1 hereof and any other
matters that are not a proper subject of arbitration, all disputes between the
parties hereto concerning the performance, breach, construction or
interpretation of this Agreement or any portion thereof, or in any manner
arising out of this Agreement or the performance thereof, shall be submitted to
binding arbitration, in accordance with the rules of the American Arbitration
Association, which arbitration shall be carried out in the manner hereinafter
set forth.
14.2 Within twenty (20) days after written notice by one party
to the other of its demand for arbitration, which demand shall set forth the
name and address of its arbitrator, the other party shall select its arbitrator
and so notify the demanding party. Within twenty (20) days thereafter, the two
arbitrators so selected shall select the third arbitrator. The decision of any
two (2) arbitrators shall be binding upon the parties. In default of either side
naming its arbitrator as
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aforesaid or in default of the selection of the said third arbitrator as
aforesaid, the American Arbitration Association shall designate such arbitrator
upon the application of either party. The arbitration proceeding shall take
place at a mutually agreeable location in Nassau County, New York or such other
location as agreed to by the parties.
14.3 A party who files a notice of demand for arbitration must
assert in the demand all claims then known to that party on which arbitration is
permitted to be demanded. When a party fails to include a claim through
oversight, inadvertence or excusable neglect, or when a claim has matured or
been acquired subsequently, the arbitrators may permit amendment. A demand for
arbitration shall be made within a reasonable time after the claim has arisen,
and in no event shall it be made after the date when institution of legal or
equitable proceedings based on such claim would be barred by the applicable
statute of limitations.
14.4 The award rendered by the arbitrators shall be final,
binding and conclusive, shall be specifically enforceable, and judgment may be
entered upon it in accordance with applicable law in the appropriate court in
the State of New York, with no right of appeal therefrom.
14.5 Each party shall pay its or his own expenses of
arbitration, and the expenses of the arbitrators and the arbitration proceeding
shall be equally shared; provided, however, that, if, in the opinion of a
majority of the arbitrators, any claim or defense was unreasonable, the
arbitrators may assess, as part of their award, all or any part of the
arbitration expenses of the other party (including reasonable attorneys' fees)
and of the arbitrators and the arbitration proceeding against the party raising
such unreasonable claim or defense; provided, further, that, if the arbitration
proceeding relates to the issue of "cause" for termination of employment, (a)
if, in the opinion of a majority of the arbitrators, "cause" existed, the
arbitrators shall assess, as part of their award, all of the arbitration
expenses of the Company (including reasonable attorneys' fees) and of the
arbitrators and the arbitration proceeding against the Employee or (b) if, in
the opinion of a majority of the arbitrators, "cause" did not exist, the
arbitrators shall assess, as part of their award, all of the arbitration
expenses of the Employee (including reasonable attorneys' fees) and of the
arbitrators and the arbitration proceeding against the Company.
15. ASSIGNMENT
15.1 This Agreement, as it relates to the employment of the
Employee, is a personal contract and the rights and interests of the Employee
hereunder may not be sold, transferred, assigned, pledged or hypothecated.
16. NOTICES
16.1 Any notice required or permitted to be given pursuant to
this Agreement shall be deemed to have been duly given when delivered by hand or
sent by certified or registered mail, return receipt requested and postage
prepaid, overnight mail or courier or telecopier as follows:
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If to the Employee:
c/o Dealers Choice Automotive Planning Inc.
0000 Xxxxxxxxx Xxxxxxxx
Xxxxx 000
Xxxx Xxxxxx, Xxx Xxxx 00000
Telecopier Number: (000) 000-0000
with a copy to:
Weil & Xxxxxxxxxx
00-00 Xxxx Xxxxxxxxx
Xxxxxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxxxxx, Esq.
Telecopier Number: (000) 000-0000
If to the Company:
00 Xxxxxxx Xxxxxx
Xxxx Xxxxxx, Xxx Xxxx 00000
Attention: Chairman of the Board
Telecopier Number: (000) 000-0000
with a copy to:
Certilman Balin Xxxxx & Xxxxx, LLP
00 Xxxxxxx Xxxxxx
Xxxx Xxxxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxxx, Esq.
Telecopier Number: (000) 000-0000
or at such other address as any party shall designate by notice to the other
party given in accordance with this Paragraph 16.1.
17. GOVERNING LAW
17.1 This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of New York applicable to
agreements made and to be performed entirely in New York.
12
18. WAIVER OF BREACH; PARTIAL INVALIDITY
18.1 The waiver by either party of a breach of any provision of
this Agreement shall not operate or be construed as a waiver of any subsequent
breach. If any provision, or part thereof, of this Agreement shall be held to be
invalid or unenforceable, such invalidity or unenforceability shall attach only
to such provision and not in any way affect or render invalid or unenforceable
any other provisions of this Agreement, and this Agreement shall be carried out
as if such invalid or unenforceable provision, or part thereof, had been
reformed, and any court of competent jurisdiction or arbitrators, as the case
may be, are authorized to so reform such invalid or unenforceable provision, or
part thereof, so that it would be valid, legal and enforceable to the fullest
extent permitted by applicable law.
19. ENTIRE AGREEMENT
19.1 This Agreement constitutes the entire agreement between the
parties with respect to the subject matter hereof and there are no
representations, warranties or commitments except as set forth herein. This
Agreement supersedes all prior agreements, understandings, negotiations and
discussions, whether written or oral, of the parties hereto relating to the
subject matter hereof. This Agreement may be amended, and any provision hereof
waived, only by a writing executed by the party sought to be charged. No
amendment or waiver on the part of the Company shall be valid unless approved by
its Board of Directors.
20. COUNTERPARTS
20.1 This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, and all of which taken together shall
constitute one and the same instrument.
21. FACSIMILE SIGNATURES
21.1 Signatures hereon which are transmitted via facsimile shall
be deemed original signatures.
22. REPRESENTATION BY COUNSEL; INTERPRETATION
22.1 The Employee acknowledges that he has been represented by
counsel in connection with this Agreement. Accordingly, any rule or law or any
legal decision that would require the interpretation of any claimed ambiguities
in this Agreement against the party that drafted it has no application and is
expressly waived by the Employee. The provisions of this Agreement shall be
interpreted in a reasonable manner to give effect to the intent of the parties
hereto.
13
23. HEADINGS
23.1 The headings and captions under sections and paragraphs of
this Agreement are for convenience of reference only and do not in any way
modify, interpret or construe the intent of the parties or affect any of the
provisions of this Agreement.
14
IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the day and year above written.
DCAP GROUP, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
---------------------------
Xxxxxx X. Xxxxxxxxx, Chairman of the Board
/s/ Xxxxxxx Xxxxxxxxx
-------------------------------------
Xxxxxxx Xxxxxxxxx
15
EXHIBIT 4.3(a)
-------------, ----
$-----------
PROMISSORY NOTE
FOR VALUE RECEIVED, XXXXXXX XXXXXXXXX (the "Maker"), having an address
as indicated under his name, hereby promises to pay to the order of DCAP GROUP,
INC. (formerly EXTECH Corporation), a Delaware corporation (the "Payee"), at 00
Xxxxxxx Xxxxxx, Xxxx Xxxxxx, Xxx Xxxx or at such other place as the holder
hereof may from time to time designate in writing, in immediately available New
York funds, the principal sum of _____________________ THOUSAND DOLLARS
($________), together with interest on the outstanding principal balance from
the date hereof at the rate of ___ percent (__%) per annum [Wall Street Journal
prime rate at time of execution]. The principal amount of this Note, together
with accrued interest thereon, shall be payable in four (4) equal annual
installments commencing one (1) year from the date hereof and continuing on the
anniversary day of the date hereof of each subsequent year, in such annual
amount as shall be necessary to self-amortize this Note at the end of such four
(4) year period [if this Note is dated later than three (3) years after February
25, 1999, then the payment terms shall be amended so that any payment that would
be otherwise due after seven (7) years from February 25, 1999 shall be due on
such seventh anniversary date]; provided, however, that the amounts due under
this Note shall be payable sooner to the extent of any proceeds received by the
Maker from the sale or other disposition of any shares of Common Stock of the
Payee on or after the date hereof (the proceeds being immediately payable to the
Payee).
The payment of all amounts due under this Note is secured by a pledge
of ________ shares of Common Stock of the Payee [five times the principal amount
of this Note] owned by the Maker pursuant to a Pledge Agreement of even date
between the Maker and the Payee (the "Pledge Agreement").
In the event (a) the Maker shall (i) fail to make any payment due
hereunder and such failure shall continue unremedied for a period of ten (10)
days following the date of written notice of default; (ii) admit in writing his
inability to pay his debts as they mature; (iii) make a general assignment for
the benefit of creditors; (iv) be adjudicated a bankrupt or insolvent; (v) file
a voluntary petition in bankruptcy or a petition or an answer seeking an
arrangement with creditors; (vi) take advantage of any bankruptcy, insolvency or
readjustment of debt law or statute or file an answer admitting the material
allegations of a petition filed against him in any proceeding under any such
law; or (vii) have entered against him a court order approving a petition filed
against him under the Federal Bankruptcy Act; or (b) there shall be a breach of
any representation, warranty, covenant or other agreement set forth in the
Pledge Agreement or that certain Employment Agreement dated
February 25, 1999 between the Maker and the Payee and such breach shall continue
unremedied for a period of fifteen (15) days following the date of written
notice thereof, then and in each and every such event, the Payee may, by written
notice to the Maker, declare the entire unpaid principal amount of this Note
then outstanding plus accrued interest to be forthwith due and payable whereupon
the same shall become forthwith due and payable.
The Maker may prepay the principal amount of this Note, in whole or in
part, from time to time, without premium or penalty, provided that the Maker
pays all interest accrued with regard to the principal prepaid to the date of
prepayment.
If the Maker shall fail to pay when due, whether by acceleration or
otherwise, all or any portion of the principal amount hereof, any such unpaid
amount shall bear interest for each day from the date it was so due until paid
in full at the rate of sixteen percent (16%) per annum, payable on demand.
Notwithstanding anything to the contrary contained in this Note, the
rate of interest payable on this Note shall never exceed the maximum rate of
interest permitted under applicable law.
This Note may not be waived, changed, modified or discharged orally,
but only by an agreement in writing, signed by the party against whom
enforcement of any waiver, change, modification or discharge is sought.
Should the indebtedness represented by this Note or any part thereof be
collected at law or in equity, or in bankruptcy, receivership or any other court
proceedings (whether at the trial or appellate level), or should this Note be
placed in the hands of any agent or attorneys for collection upon default or
maturity, the Maker agrees to pay, in addition to all other amounts due and
payable hereunder, all reasonable costs and expenses of collection or attempting
to collect this Note, including reasonable attorneys' fees.
The Maker and any endorsers hereof, for themselves and their respective
representatives, successors and assigns, expressly (a) waive presentment,
protest, notice of dishonor, notice of non-payment, notice of maturity, notice
of protest, diligence in collection, and the benefit of any applicable
exemptions, including, but not limited to, exemptions claimed under insolvency
laws, and (b) consent that the Payee may release or surrender, exchange or
substitute any property or other collateral or security now held or which may
hereafter be held as security for the payment of this Note, and/or may release
any guarantor, and/or may extend the time for payment and/or otherwise modify
the terms of payment of any part or the whole of the debt evidenced hereby.
Any notice, demand or request relating to any matter set forth herein
shall be in writing and shall be deemed effective when hand delivered, when
mailed, postage prepaid, by registered or certified mail, return receipt
requested, or by a nationally recognized overnight mail or courier
2
service, or when sent by facsimile transmission (with transmission confirmation)
to any party hereto at its address stated herein or at such other address of
which it shall have notified the party giving such notice in writing as
aforesaid.
The Payee shall be entitled to assign all or any portion of its right,
title and interest in and to this Note at its sole discretion without notice to
the Maker, provided that the Maker shall continue to make payments required
hereunder to the Payee until he has received notice of change of payee for
payments as provided herein.
Notwithstanding any other provision of this Note, all payments made
hereunder shall be applied first to payment of sums payable hereunder other than
interest and principal, secondly, interest on the principal balance outstanding
hereunder from time to time, and thirdly to principal.
The Maker acknowledges and agrees that the obligations under this Note
are unconditional and are not subject to any defense, counterclaim, or right of
offset or setoff.
This Note shall be governed by, and construed in accordance with, the
laws of the State of New York, excluding conflict of law principles thereof.
The Maker acknowledges that he has been represented by counsel in
connection with this Note. Accordingly, any rule or law or any legal decision
that would require the interpretation of any claimed ambiguities in this Note
against the party that drafted it has no application and is expressly waived by
the Maker. The provisions of this Note shall be interpreted in a reasonable
manner to give effect to the intent of the Maker and the Payee.
Xxxxxxx Xxxxxxxxx
Address: 0000 Xxxxxxxxx Xxxxxxxx
Xxxxx 000
Xxxx Xxxxxx, Xxx Xxxx 00000
Telecopier Number: (000) 000-0000
3
ACKNOWLEDGMENT
STATE OF NEW YORK )
) ss.:
COUNTY OF NASSAU )
On ____________, ____ before me personally came Xxxxxxx
Xxxxxxxxx to me known, and known to be the individual described in, and who
executed the foregoing Note, and duly acknowledged to me that he executed the
same.
Notary Public
4
EXHIBIT 4.3(b)
PLEDGE AGREEMENT, dated ____________, ____, by and between
XXXXXXX XXXXXXXXX (the "Pledgor") and DCAP GROUP, INC. (formerly EXTECH
Corporation), a Delaware corporation (the "Pledgee").
WHEREAS, simultaneously herewith, the Pledgee is loaning to
the Pledgor the amount of ___________ Thousand Dollars ($________) and the
Pledgor is executing and delivering to the Pledgee a Promissory Note in such
principal amount (the "Note").
WHEREAS, the Pledgee desires, and the Pledgor is willing, to
secure performance of the Note.
WHEREAS, certain capitalized terms used herein are defined in
Section 8 hereof.
NOW, THEREFORE, the parties hereto agree as follows:
1. PLEDGE. The Pledgor hereby grants to the Pledgee, as security for the
performance by the Pledgor of all of his obligations under the Note (the
"Obligations"), a valid and binding first security interest in the Collateral
(as hereinafter defined). The Pledgor has delivered simultaneously herewith to
the Pledgee, and the Pledgee hereby acknowledges receipt of, a certificate
evidencing the Pledged Shares registered in the name of the Pledgor (the
"Pledged Certificate"), accompanied by appropriate stock powers endorsed by the
Pledgor (the "Stock Powers").
2. TERM. This Agreement shall continue in effect until terminated in accordance
with Section 7 hereof.
3. SHARE RIGHTS; CASH DIVIDENDS.
(a) In the event of any change in the Pledged Shares during the term of
this Agreement by reason of any stock dividend, stock split-up, reverse split,
recapitalization, combination, reclassification, exchange of shares, merger,
consolidation or the like, all new, substituted, or additional stock, or other
securities, issued by reason of any such change (the "Adjusted Shares") (the
Pledged Shares and the Adjusted Shares are hereinafter referred to collectively
as the "Shares") shall be retained by or delivered to, as the case may be, and
held by the Pledgee under the terms of this Agreement in the same manner as the
Pledged Shares originally pledged hereunder.
(b) Unless and until the occurrence of a Default (as hereinafter
defined), the Pledgor shall have the right to vote the Shares. Upon the
occurrence of a Default, the Shares shall be registered in the name of the
Pledgee and the Pledgee shall have all incidents of ownership thereof.
(c) Provided that no Default has occurred, any and all cash dividends
paid in respect of the Shares shall be paid to the Pledgor; provided, however,
that, in any event, any extraordinary
distributions made in respect of the Shares shall be retained by the Pledgee and
held by it in accordance with the terms hereof.
4. REPRESENTATIONS. The Pledgor hereby represents and warrants to the Pledgee
that:
(a) The Pledgor is the sole record and beneficial owner of the Pledged
Shares, free and clear of all liens, pledges, security interests, encumbrances,
restrictions, subscriptions, hypothecations, charges and claims of any kind
whatsoever (collectively, "Liens").
(b) No consents of governmental and other regulatory agencies, foreign
or domestic, or of other parties are required to be received by or on the part
of the Pledgor to enable him to enter into and carry out this Agreement and the
transactions contemplated hereby.
(c) The Pledgor has the power to enter into this Agreement and to carry
out his obligations hereunder. This Agreement constitutes the valid and binding
obligation of the Pledgor, and is enforceable in accordance with its terms.
(d) Neither the execution and delivery of this Agreement nor compliance
by the Pledgor with any of the provisions hereof nor the consummation of the
transactions contemplated hereby will violate or, alone or with notice or the
passage of time, result in the material breach or termination of, or otherwise
give any contracting party the right to terminate, or declare a default under,
the terms of any agreement, understanding or arrangement to which the Pledgor is
a party or by which he or his assets or properties may be bound.
5. COVENANTS.
(a) The Pledgor hereby covenants that from and after the date hereof
and until the Obligations shall have been satisfied in full:
(i) The Pledgor will not grant, create, incur, assume or
suffer to exist any Lien in the Collateral (except for the Lien created hereby).
(ii) The Pledgor will defend the Pledgee's right, title, and
security interest in and to the Collateral against the claims of any person,
firm, corporation or other entity.
(iii) The Pledgor shall at any time and from time to time,
upon the written request of the Pledgee, execute and deliver such other
instruments and documents and do such further acts and things as the Pledgee may
reasonably request in order to effect the purposes of this Agreement.
(b) The Pledgee's sole duty with respect to the custody, safekeeping
and physical preservation of the Collateral in its possession, under Section
9-207 of the Code or otherwise, shall be to deal with it in the same manner as
the Pledgee deals with similar securities and property for its own account.
2
6. DEFAULT.
(a) In the event that the Pledgor fails to pay to the Pledgee any
Obligation when due or there shall otherwise occur an Event of Default (as
defined in the Note) ("Default"), the Pledgee shall have all of the rights and
remedies afforded to secured parties with respect to the Collateral as set forth
in the Code as well as all other rights and remedies granted in the Note and
this Agreement. Without limiting the generality of the foregoing, the Pledgee,
without demand of performance or other demand, presentment, protest,
advertisement or notice of any kind (except any notice required by law referred
to below) to or upon the Pledgor (all and each of which demands, defenses,
advertisements and notices are hereby waived), may in such circumstances
forthwith collect, receive, appropriate and realize upon the Collateral, or any
part thereof, and/or may forthwith sell, assign, give an option or options to
purchase or otherwise dispose of and deliver the Collateral or any part thereof
(or contract to do any of the foregoing), in one or more parcels at public or
private sale or sales, upon such terms and conditions and at such prices as it
may deem advisable, for cash or on credit or for future delivery without
assumption of any credit risk. The Pledgee shall have the right upon any such
public sale or sales, and, to the extent permitted by law, upon any such private
sale or sales, to purchase the whole or any part of the Collateral so sold. The
Pledgee shall apply any proceeds from time to time held by it and the net
proceeds of any such sale or other disposition, after deducting all reasonable
costs and expenses of every kind incurred in respect thereof or incidental to
the care or safekeeping of any of the Collateral or in any way relating to the
Collateral or the rights of the Pledgee hereunder, including, without
4limitation, reasonable attorneys' fees and disbursements of counsel to the
Pledgee, to the satisfaction in whole or in part of the Obligations, in such
order as the Pledgee may elect and only after such application and after the
payment by the Pledgee of any other amount required by any provision of law,
including, without limitation, Section 9-504 (1)(c) of the Code, need the
Pledgee account for the surplus, if any, to the Pledgor. To the extent permitted
by applicable law, the Pledgor waives all claims, damages and demands he may
acquire against the Pledgee arising out of the lawful exercise by it of any
rights hereunder. Neither the Pledgee nor any of its respective directors,
officers, employees or agents shall be liable for failure to sell or otherwise
dispose of the Collateral or for any delay in doing so. If any notice of a
proposed sale or other disposition of the Collateral shall be required by law,
such notice shall be deemed reasonable and proper if given at least ten (10)
days before such sale or other disposition. In any event, notice of a proposed
sale or other disposition shall be given at least ten (10) days before such sale
or other disposition to the Pledgor and Xxxxx Xxxx. The Pledgor shall remain
liable for any deficiency if the proceeds of any sale or other disposition of
the Collateral are insufficient to pay all of the Obligations and any and all
costs and expenses of every kind incurred by the Pledgee with respect to the
collection of such deficiency, including, without limitation, all reasonable
fees and disbursements of any attorneys employed by the Pledgee.
The Pledgor recognizes that the Pledgee may be unable to
effect a public sale of any or all the Collateral by reason of certain
restrictions contained in the Securities Act of 1933, as amended, and applicable
state securities laws or otherwise, and may be compelled to resort to one or
more private sales thereof to a restricted group of purchasers which will be
obliged to agree, among other things, to acquire such securities for their own
account for investment and not with a
3
view to the distribution or resale thereof. The Pledgor acknowledges and agrees
that any such private sale may result in prices and other terms less favorable
than if such sale were a public sale and agrees that any such private sale under
such circumstances shall not be evidence that it has been made in other than a
commercially reasonable manner.
The Pledgor agrees to use his best efforts to do or cause to
be done all such other acts as may be necessary to make such sale or sales of
all or any portion of the Collateral pursuant to this section valid and binding
and in compliance with any and all other applicable requirements of law.
(b) The rights of the Pledgee hereunder shall not be conditioned or
contingent upon the pursuit by the Pledgee of any right or remedy against the
Pledgor, any other person which may be or become liable in respect of all or any
part of the Obligations or against any collateral security therefor, guarantee
therefor or right of offset with respect thereto. Neither the Pledgee nor any of
its affiliates or representatives shall be liable for any failure to demand,
collect or realize upon all or any part of the Collateral or for any delay in
doing so, nor shall the Pledgee be under any obligation to sell or otherwise
dispose of any Collateral upon the request of the Pledgor or any other person or
to take any other action whatsoever with regard to the Collateral or any part
thereof.
7. TERMINATION OF AGREEMENT. Upon (i) the Pledgor's satisfaction of the
Obligations in full (at which time the Pledgee shall redeliver the Pledged
Certificate and accompanying Stock Powers to the Pledgor), or (ii) the
conclusion of the actions contemplated by Section 6 hereof, this Agreement shall
thereupon terminate.
8. DEFINED TERMS. The following terms shall have the following meanings:
(a) "Code" means the Uniform Commercial Code from time to time in
effect in the State of New York.
(b) "Collateral" means the Pledged Shares and all Proceeds.
(c) "Pledged Shares" means _____________ thousand (________) shares of
Common Stock of the Pledgee [five times the principal amount of the Note],
together with any and all shares, stock certificates, options or rights of any
nature whatsoever that may be issued or granted to the Pledgor with regard
thereto, in substitution or replacement thereof, as a conversion thereof, in
exchange therefor or otherwise in respect thereof.
(d) "Proceeds" means all "proceeds" as such term is defined in Section
9-306(1) of the Code on the date hereof and, in any event, shall include,
without limitation, all dividends or other income from the Pledged Shares,
collections thereon and distributions with respect thereto.
4
8. MISCELLANEOUS.
(a) This Agreement shall be binding upon and shall inure to the benefit
of the parties hereto and their respective legal representatives, successors and
assigns.
(b) This Agreement contains the entire agreement and understanding
between the parties in respect of the subject matter hereof, and cannot be
modified, changed, discharged or terminated except by an instrument in writing,
signed by the party against whom enforcement of any modification, change,
discharge or termination is sought.
(c) A waiver of the breach of any term or condition of this Agreement
shall not be deemed to constitute a waiver of any other breach of the same or
any other term or condition.
(d) This Agreement will be construed and governed in accordance with
the laws of the State of New York, excluding choice of law rules thereof.
(e) All notices or other communications required or permitted hereunder
shall be sufficiently given if delivered by hand, or sent by certified mail,
return receipt requested, postage prepaid, facsimile transmission or overnight
mail or courier, addressed as follows:
If to the Pledgor:
c/o Dealers Choice Automotive Planning Inc.
0000 Xxxxxxxxx Xxxxxxxx
Xxxxx 000
Xxxx Xxxxxx, Xxx Xxxx 00000
Telecopier Number: (000) 000-0000
with a copy to:
Weil & Xxxxxxxxxx
00-00 Xxxx Xxxxxxxxx
Xxxxxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxxxxx, Esq.
Telecopier Number: (000) 000-0000
If to the Pledgee:
00 Xxxxxxx Xxxxxx
Xxxx Xxxxxx, Xxx Xxxx 00000
Attention: Chairman of the Board
Telecopier Number: (000) 000-0000
5
with a copy to:
Certilman Balin Xxxxx & Xxxxx, LLP
00 Xxxxxxx Xxxxxx
Xxxx Xxxxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxx, Esq.
Telecopier Number: (000) 000-0000
(f) The Pledgor waives any and all notice of the extension or
modification of the terms of the Note.
(g) In the event that the Collateral or any portion thereof is released
to the Pledgor and any payments of, or proceeds of any security for, the
Obligations, or any part thereof, are subsequently invalidated, declared to be
fraudulent or preferential, set aside and/or required to be repaid to a trustee,
receiver or any other party under any bankruptcy law, state or federal law,
common law or equitable cause, then the Pledgor shall redeliver the Collateral
and Stock Powers to the Pledgee and, until so redelivered, shall hold the
Collateral and Stock Powers as agent of, and in trust for, the Pledgee.
(h) If any provision hereof is declared to be invalid and
unenforceable, then, to the fullest extent permitted by law, the other
provisions hereof shall remain in full force and effect and shall be liberally
construed in favor of the Pledgee in order to carry out the intentions of the
parties hereto as nearly as may be possible.
(i) Each party acknowledges that he or it has been represented by
counsel in connection with this Agreement. Accordingly, any rule or law or any
legal decision that would require the interpretation of any claimed ambiguities
in this Agreement against the party that drafted it has no application and is
expressly waived by the parties. The provisions of this Agreement shall be
interpreted in a reasonable manner to give effect to the intent of the parties
hereto.
6
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
Xxxxxxx Xxxxxxxxx
DCAP GROUP, INC.
By:
--------------------------
Xxxxxx X. Xxxxxxxxx,
Chairman of the Board
7
