EXHIBIT 10.1
EMPLOYMENT AGREEMENT
AGREEMENT made as of May 22, 1998, between EPIC RESORTS, INC., a Delaware
corporation (the "COMPANY"), and Xxxxxx X. Xxxxxxx ("EXECUTIVE").
In consideration of the mutual covenants contained herein and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. EMPLOYMENT. The Company shall employ Executive, and Executive accepts
continued employment with the Company, upon the terms and conditions set forth
in this Agreement for the period beginning on the date hereof and ending as
provided in paragraph 2 hereof (the "EMPLOYMENT PERIOD").
2. TERM. Subject to the terms and conditions hereinafter set forth,
Executive shall be employed for a term commencing on the date hereof and
expiring three (3) years after the date hereof unless such employment is earlier
terminated as provided in Section 5 herein (the "TERM"). If this Agreement is
not terminated prior to the expiration of the employment period, the Term of the
Agreement shall continue on a month-to-month basis after the expiration of the
three-year Term, until either party to this Agreement notifies the other party
in writing that this Agreement has been terminated. After the initial
three-year Term, either party may terminate this Agreement for any or no reason
upon written notice to the other party.
3. DUTIES. During the Term, Executive shall devote his best efforts and
substantially all of his business time and services to the Company. Executive
shall perform such duties and services as the Chief Executive Officer (CEO)
shall request.
4. COMPENSATION AND BENEFITS.
(a) SALARY. The Company agrees to pay Executive a salary during the
Employment Period, in semi-monthly installments. Executive's initial salary
shall be Two Hundred Eighty Thousand Dollars ($280,000) per anum. Executive's
Salary may be increased by the CEO from time to time.
(b) BONUS(ES). The CEO may, in its sole discretion, award a bonus to
Executive for any calendar year during the Employment Period.
(c) EXPENSE REIMBURSEMENT. The Company shall reimburse Executive for
all reasonable expenses incurred by him in the course of performing his duties
under this Agreement that are consistent with the Company's policies in effect
from time to time with respect to travel, entertainment and other business
expenses, subject to the Company's requirements with respect to reporting and
documentation of such expenses.
(d) OTHER BENEFITS. Executive shall be entitled, if and to the
extent eligible, to participate in any group life, hospitalization or Disability
insurance plan, health program,
pension plan, similar benefit plan or other so-called "fringe benefits" of
the Company, that may be no less favorable to Executive than the terms
offered to other Employees of the Company during the Term.
5. TERMINATION. Executive's employment hereunder may be terminated
during the Term as described below.
5.1 RESIGNATION, DEATH OR DISABILITY. In the event of the
resignation, of Executive during the Term, Executive's employment hereunder
shall be terminated and the Company shall pay to Executive, all accrued and
unpaid Salary and Benefits through the date of such termination. Except as set
forth above in this Section 5.1, and except for any salary and other benefits
accrued, vested and unpaid as of the date of his resignation, the Company shall
not be under any further obligation to the Executive after the date of the
Executive's resignation, pursuant to this Agreement. In the event of the death
or Disability (as defined below) of Executive during the Term, the Company shall
continue to pay Executive's executors, legal representatives or administrators,
the base salary outlined in Paragraph 4.a, for a period of one (1) year. A
"Disability" shall be deemed to occur if Executive is unable to perform his
duties and responsibilities hereunder to the full extent required by this
Agreement by reasons of illness, injury or incapacity for a period of more than
forty-five (45) consecutive days or more than ninety (90) days in the aggregate,
during any one-year period during the Term.
5.2 TERMINATION FOR CAUSE.
(a) The Company may terminate Executive's employment hereunder
at any time for "Cause" upon written notice to Executive. For purposes of this
Agreement, "Cause" shall mean the occurrence of any of the following: (i)
alcohol abuse or use of controlled substances during employment hours, (ii)
except where non-performance is caused by a resignation, Disability or death,
Executive's refusal or inability to competently perform his obligations under
this Agreement, as determined by the CEO, (iii) any type of harassment, violence
or threat thereof, of other employees of the Company or toward third paries of a
kind that may tend to result in liability being incurred by the Company toward
such employee or third party, (iv) any type of disloyalty to the Company or any
of its affiliates or subsidiaries, (v) gross negligence or willful misconduct
with respect to the Company or any of its affiliates or subsidiaries, including
without limitation fraud, embezzlement, theft or proven dishonesty in the course
of his employment, or (vi) a conviction of a felony or a misdemeanor involving
moral turpitude or the entering of a plea of guilty or NOLO CONTENDERE to a
felony.
(b) If the Company exercises the right to terminate Executive's
employment with Company for Cause, the Company's obligations to Executive shall
be limited solely to the payment of accrued and unpaid Salary and Benefits
through the date of such termination.
(c) The Company shall have such rights and remedies as may be
available to it for any breach by the Executive of this Agreement or otherwise.
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5.3 TERMINATION WITHOUT CAUSE.
(a) At any time, the Company may terminate Executive's
employment hereunder for a reason not constituting Cause by giving written
notice to Executive one hundred and twenty (120) days prior to such termination.
(b) If Executive is terminated without Cause, the Executive
shall be entitled to payment of, (i) all accrued and unpaid Salary and Benefits
through the date of such termination, and (ii) a lump sum amount equal to two
(2) years of his salary.
5.4 SPECIAL TERMINATION OF EMPLOYMENT. If the Company merges,
consolidates or consummates any other business combination in which the Company
is not the surviving entity, and this Agreement is terminated by the Company
thereafter for any reason except for Cause (a "SPECIAL TERMINATION OF
EMPLOYMENT"), the Company shall pay to Executive a lump sum amount upon
termination equal to five (5) years Salary.
6. CONFIDENTIAL INFORMATION. Executive agrees that, for a period of two
(2) years following the expiration or termination of Executive's employment with
the Company pursuant to this Agreement, Executive shall keep secret and retain
in strictest confidence, and shall not use for Executive's benefit or the
benefit of others, directly or indirectly, any proprietary, confidential or
secret matters relating to the Company or any other entity which may hereafter
become an affiliate thereof, including, without limitation, financial
information, trade secrets, customer lists, details of client or consultant
contracts, pricing policies, operational methods, marketing plans or strategies,
product development techniques or plans, business acquisition plans, new
personnel acquisition plans, technical processes, designs and design projects,
all as may be learned, acquired or developed by Executive while employed by the
Company. In the event that Executive or any of his representatives becomes
legally compelled to disclose any of the proprietary, confidential or secret
information of the Company, Executive will provide the Company with prompt
written notice so that the Company may seek a protective order or other
appropriate remedy.
7. NON-COMPETE, NON-SOLICITATION.
(a) Executive acknowledges that in the course of his employment with
the Company pursuant to this Agreement, he will become familiar, and during the
course of his employment by the Company or any of its subsidiaries or affiliates
or any predecessor thereof prior to the date of this Agreement he has become
familiar, with trade secrets and customer lists or any other confidential
information concerning the Company and its subsidiaries and affiliates and
predecessors thereof and that his services have been and will be of special,
unique and extraordinary value to the Company.
(b) Executive agrees, (i) that during the Employment Period he shall
not in any manner, directly or indirectly, through any person, firm or
corporation, alone or as a member of a partnership or as an officer, director,
stockholder, investor or employee of or in any other corporation or enterprise
or otherwise, engage in or be engaged in, the timeshare business or any other
business then actively being conducted by the Company or any of its
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subsidiaries or affiliates, and (ii) that for six (6) months after the
Employment Period he shall not in any manner, directly or indirectly, through
any person, firm or corporation, alone or as a member of a partnership or as
an officer, director, stockholder, investor or employee of or in any other
corporation or enterprise or otherwise engage in the activities of the
timeshare business.
(c) Executive further agrees that during the Employment Period and
for two (2) years thereafter he shall not in any manner, directly or indirectly,
induce or attempt to induce any employee of the Company or any of its
subsidiaries or affiliates to quit or abandon his employ.
(d) Nothing in this paragraph 7 shall prohibit Executive from being:
(i) a stockholder in a mutual fund or a diversified investment company or, (ii)
a passive owner of not more than 2% of the outstanding stock of any class of a
corporation that is publicly traded, so long as Executive has no active
participation in the business of such corporation.
(e) If, at the time of enforcement of this paragraph, a court holds
that the restrictions stated herein are unreasonable under circumstances then
existing, the parties hereto agree that the maximum period, scope or
geographical area reasonable under such circumstances shall be substituted for
the stated period, scope or area and that the court shall be allowed to revise
the restrictions contained herein to cover the maximum period, scope and area
permitted by law.
8. ENFORCEMENT. Because Executive's services are unique and because
Executive has access to Confidential Information and work product, the parties
hereto agree that the Company would be damaged irreparably in the event any of
the provisions of paragraph 7 hereof were not performed in accordance with their
specific terms or were otherwise breached and that money damages would be an
inadequate remedy for any such non-performance or breach. Therefore, the
Company or its successors or assigns shall be entitled, in addition to other
rights and remedies existing in their favor, to an injunction or injunctions to
prevent any breach or threatened breach of any such provisions and to enforce
such provisions specifically (without posting a bond or other security).
9. SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit of
and be binding upon the Company and Executive and their respective successors,
executors, administrators, heirs and/or permitted assigns; PROVIDED, HOWEVER,
that neither Executive nor the Company may make any assignments of this
Agreement or any interest herein, by operation of law or otherwise, without the
prior written consent of the other party, except that, without such consent, the
Company may assign this Agreement to any successor to all or substantially all
of its assets and business by means of liquidation, dissolution, merger,
consolidation, transfer or assets, or otherwise.
10. NOTICE. Any notice or communication required or permitted under this
Agreement shall be made in writing and, (i) sent by overnight courier, (ii)
mailed by certified or registered mail, return receipt requested or, (iii) sent
by telecopier, addressed to the address of
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the parties set forth on page 1 hereof or to such other address as either
party may from time to time duly specify by notice given to the other party
in the manner specified above.
11. ENTIRE AGREEMENT; AMENDMENTS. This Agreement sets forth the
understanding of the parties hereto relating to the subject matter hereof, and
merges and supersedes all prior and contemporaneous discussions, agreements and
understandings of every nature between the parties hereto relating to the
employment of Executive with the Company. This Agreement may not be changed or
modified, except by an agreement in writing signed by each of the parties
hereto.
12. WAIVER. Any waiver by either party of any breach of any term or
condition in this Agreement shall not operate as a waiver of any other breach of
such term or condition or of any other term or condition, nor shall any failure
to enforce any provision hereof operate as a waiver of such provision or of any
other provision hereof or constitute or be deemed a waiver or release of any
other rights, in law or in equity.
13. GOVERNING LAW. Notwithstanding any contrary choice of laws
principles, this Agreement shall be governed by and construed in accordance with
the substantive laws of the State of Pennsylvania, applicable to contracts
executed and performed within the State of Pennsylvania.
14. SEVERABILITY. Whenever possible, each provision of this Agreement
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or the effectiveness or validity of any provision in any
other jurisdiction, and this Agreement will be reformed, construed and enforced
in such jurisdiction as if such invalid, illegal or unenforceable provision had
never been contained herein.
15. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, and all of which
together shall be deemed to be one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
By /s/X.X. Xxxxxxx
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Chairman and CEO, Epic Resorts, Inc.
