[LOGO] XXXXXX
TECHNOLOGIES, INC.
XXXXXX TECHNOLOGIES, INC.
EMPLOYMENT AGREEMENT
THIS AGREEMENT (the "Agreement") is made and entered into this 29th day of
February, 2000 (the "Effective Date"), by and between Xxxxxx Technologies, Inc.
(hereinafter referred to as "Xxxxxx Technologies," "Xxxxxx" or "Company"), a
Delaware Corporation with a business address of 00-00 00xx Xxxxxx, Xxxx Xxxxxx
Xxxx, XX 00000, and Xxxxx Xxxxxx (hereinafter referred to as "Employee"),
residing at 000-00 00xx Xxxx, Xxxxxxxx, Xxx Xxxx 00000.
WITNESSETH:
WHEREAS, Xxxxxx Technologies currently employs Employee as President
and Chief Executive Officer of the Company, and the services of the Employee,
his experience, expertise and knowledge of the affairs of the Company are of
great value to the Company; and
WHEREAS, Xxxxxx Technologies deems it essential that it continue to employ
Employee as Chief Executive Officer of the Company; and
WHEREAS, Employee consents to be so employed.
NOW THEREFORE, in consideration of the premises, of the mutual covenants
herein contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:
I Employment
Xxxxxx Technologies hereby employs Employee, and Employee hereby agrees to
be employed, as Chief Executive Officer of the Company upon the terms and
conditions herein set forth. Employee shall be responsible for strategic
oversight and administration of the Company and any other responsibilities and
duties that may be assigned to him customarily appertaining to the role of Chief
Executive Officer, from time to time by the Board of Directors of the Company.
Employee agrees to devote his reasonable best diligence and his full time to the
performance of his duties hereunder. Employee's principal place of employment
shall be at the Company's headquarters in Long Island City, New York; Employee
shall travel as reasonably required in the performance of his duties hereunder.
March 9, 2000
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II Term
The term of Employee's initial employment as Chief Executive Officer shall
be three (3) years, ending on December ___, 2002. This Agreement and Employee's
employment thereunder shall be renewable thereafter on a year-to-year basis,
unless either party gives 60 days written notice of termination before the end
of the then-current term.
III Compensation & Benefits
Xxxxxx Technologies shall pay Employee, as full consideration for the
services to be rendered hereunder, compensation consisting of the following:
(1) An initial Annual Base Salary of $200,000, payable bi-monthly or in
accordance with any other payment schedule as may be adopted generally for
the payment of the Company's payroll. Said Annual Base Salary shall be
increased annually, on each anniversary of the Effective Date of this
Agreement, by a minimum of ten percent (10%). Additionally, Employee shall
be eligible for annual merit, or cost-of-living increases as may be
determined by the Executive Compensation Committee of the Board of
Directors;
(2) Incentive Compensation based upon the EBITDA earned by the Company during
each fiscal year, as a percentage of the Company's net revenues, as
represented by the following formula: [$5,000 x (EBITDA/Net Revenues) x
100], payable at or about the end of each fiscal year of employment
hereunder, commencing April 1, 2000. To illustrate, if the Company's EBITDA
for the fiscal year is $1 Million and its net revenues are $10 Million,
Employee shall receive incentive compensation under this paragraph in the
amount of $50,000. Additionally, Employee shall be eligible for annual
merit bonuses as may be determined by the Executive Compensation Committee
of the Board of Directors;
(3) Participation in any incentive compensation plan, pension or profit-sharing
plan, stock purchase or stock option plan, (including, without limitation,
the Company's 1996 Employee Stock Option Plan), annuity or group insurance
plan previously adopted by the Company or which may be adopted by the
Company at some future date, on terms and in amounts no less favorable than
provided for other Xxxxxx employees similarly employed.
(4) Immediate vesting of all Company stock options held by or issued to
Employee in the event that, and at such time as, Xxxxxx Technologies has a
change in control or is acquired by another entity or company. (For
purposes of this Agreement, "control" is defined as any event or
circumstance that would require disclosure pursuant to Item 1 of Form 8-K
or any comparable requirement of the Securities and Exchange Commission.);
(5) Employment benefits generally provided to Xxxxxx employees, including
medical and dental insurance, on terms and in amounts no less favorable
than provided for other Xxxxxx employees similarly employed;
(6) Fifteen (15) business days per year for vacation time, and five business
days per year for sick or personal leave, during which times Employee will
be compensated the normal pro-rated portion of his base salary;
March 9, 2000
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(7) A discretionary spending allowance in the amount of $10,000 per year, which
allowance may be utilized at Employee's sole discretion for the payment of
costs and expenses relating to or arising out of the Company's business,
potential business or the Employee's employment hereunder. The Company
shall promptly establish a bank checking account in Employee's name into
which the Company shall deposit the sum of $10,000 on or about January 2nd
of each calendar year. Said checking account shall be linked to a debit
credit card issued in Employee's name;
(8) Reimbursement for all expenses incurred by Employee in the ordinary course
of his performance of duties hereunder and submitted by him with supporting
documentation to the Company's accounting department, in terms no less
favorable than provided for other Xxxxxx employees similarly employed;
(9) Monthly payments of up to $500 to pay for the cost of a leased automobile
to be used by Employee. Additionally, the Company shall make full payment
of automobile insurance premiums and operating expenses relating to said
automobile; and
(10) Reimbursement for any salary payments by the Company to Employee which were
previously declined or deferred by Employee. Said reimbursement shall be
made by April 15, 2000.
IV Termination For Cause
The Company shall have ""cause" to terminate this Agreement upon (i) the
commission by Employee of an act of (a) criminal misconduct, or (b) fraud
against the Company; or (ii) the commission by the Employee of an act of
malfeasance, recklessness or gross negligence against the Company that is
injurious to the Company or its customers; or (iii) a material breach by
Employee of the terms of this Agreement; in any of which cases the Company may
at any time thereafter by written notice to Employee immediately terminate this
Agreement.
V Severance
If the Company effects any change in Employee's title, or diminishes, in
any significant manner, Employee's duties or responsibilities of employment,
then Employee shall have the immediate right, at his sole option, to a position
as consultant for the company for a period of one year, during which time
Employee shall receive the compensation and benefits as set forth in section III
of this Agreement.
VI Non-Disclosure
(1) Employee recognizes that the Company possesses and will continue to possess
non-public information that has been created, discovered, developed, or
otherwise become known to it, and/or in which property rights have been
assigned or otherwise conveyed to it, which information has commercial
value in the business in which it is engaged or may become engaged. All of
the aforementioned information is hereinafter called "Proprietary
Information."
(2) By way of illustration, but not limitation, Proprietary Information
includes trade secrets, processes, structures, formulas, data, know-how,
improvements, inventions, product concepts, techniques, marketing plans,
strategies, forecasts, customer lists and information about the Company's
employees and/or consultants.
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(3) At all times, both during Employee's employment by the Company and after
its termination, Employee shall keep in confidence and trust all
Proprietary Information, and Employee shall not use or disclose any
Proprietary Information or anything directly relating to it without the
written consent of the Chief Executive Officer of the Company, except as
may be necessary in the ordinary course of Employee's performing his duties
as an employee of the Company and only for the benefit of the Company.
VII Non-Solicitation
During the period of the Employee's employment by the Company, and for a
period of twelve months following the termination of the Employee's Employment
with the Company for cause (as defined in Paragraph IV of this Agreement),
Employee shall not, directly or indirectly, without the prior written consent of
the Company (a) solicit or induce any employee of the Company to leave his or
her employment; or (b) hire for any purpose any employee of the Company or any
employee who has left such employment within the previous six months; or (c)
solicit or accept the business for any competing products of any party who was a
client or customer of the Company at any time during the term of Employee's
employment hereunder.
VIII Non Competition
During the period of Employee's employment by the Company and for a period
of twelve months following the termination of the Employee's Employment with the
Company for cause (as defined in Paragraph IV of this Agreement), Employee shall
not, directly or indirectly, engage or become interested in any way (whether as
an owner, stockholder, partner, lender, investor, director, officer, employee,
consultant or otherwise) in any activity, business or enterprise, located within
the geographical area of the United States or Canada, that is competitive with
any significant part of the business conducted by the Company or as contemplated
to be conducted by it [which, for purposes of this Paragraph VI, shall be deemed
to be competitive if it involves predominantly similar types of products or
services and is directed at predominantly similar types of customers as any
business of the Company (except that ownership of not more than 5% of the
outstanding securities of any class of any corporation that are listed on a
national securities exchange or traded in the over-the-counter market shall not
be considered a breach of this Paragraph VIII)].
IX Miscellaneous Provisions
(1) Acknowledgments and Affirmations: Employee recognizes, understands, agrees
and acknowledges that the Company has a legitimate and necessary interest
in protecting its goodwill and Proprietary Information. Employee further
affirms, represents, and acknowledges that in the event of Employee's
termination of employment with the Company, Employee's experience and
capabilities are such that the enforcement of this Agreement will not
prevent him from obtaining employment in another line of business different
from that carried on by the Company and permitted under this Agreement.
Employee further affirms, represents and acknowledges that Employee has
received good and valuable consideration for entering into this Agreement.
(2) Remedies for Breach. Employee agrees that any breach of this Agreement by
Employee would cause irreparable damage to the Company and that, in the
event of such breach, the Company
March 9, 2000
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shall have, in addition to any and all remedies at law, the right to an
injunction, specific performance or other equitable relief to prevent or
redress the violation of Employee's obligations hereunder.
(3) Separability. If any provision hereof shall be declared unenforceable for
any reason, such unenforceability shall not affect the enforceability of
the remaining provisions of this Agreement. Further, such provision shall
be reformed and construed to the extent permitted by law so that it would
be valid, legal and enforceable to the maximum extent possible.
(4) Applicable Law. Any dispute arising under or related in any manner to this
Agreement or to Employee's employment by the Company or to the termination
of said employment shall in all respects be governed by, adjudicated,
construed and enforced in accordance with the laws of the State of New
York.
(5) Jurisdiction and Venue. Employee irrevocably and unconditionally submits to
the exclusive jurisdiction of any United States federal or state court
sitting in New York in any action or proceeding relating in any manner to
this Agreement or to Employee's employment by the Company or to the
termination of said employment. Further, Employee irrevocably and
unconditionally agrees that all claims relating in any manner to this
Agreement or to Employee's employment by the Company or to the termination
of said employment may be heard and determined in any such court and waives
any objection Employee may now or hereafter have as to venue of any such
action or proceeding brought in such court or the fact that such court is
an inconvenient forum.
XXXXXX TECHNOLOGIES, INC. XXXXX XXXXXX
00-00 00XX Xxxxxx
Xxxx Xxxxxx Xxxx, XX 00000
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------
/s/ Xxxxx Xxxxxx
------------------------
Title: President (signature)
Date: 2/29/00
Date: 2/29/00
March 9, 2000
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