EXHIBIT 10.43
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT entered into as of August 12, 2002 (the "Effective
Date") by and between X.X. Xxxxxx Group Inc., a Delaware corporation, with
principal offices at 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("Employer") and
Xxxxxx Xxxxx, residing at _____________________________, New York _____
("Executive").
W I T N E S S E T H:
A. Employer, directly and through its subsidiaries, is engaged in the business
of developing software for, and providing for use by its ultimate customers
of, electronic brokerage services and electronic trading programs for use
by professional and other retail customers including allowing such
customers to trade through their own home or office computers, and services
incident thereto, operating a block trading desk and disseminating
financial and trading information ("Employer`s Business");
B. Employer desires to employ Executive, and Executive desires to accept such
employment, on the terms and conditions set forth in this Agreement.
W I T N E S S E T H:
In consideration of the facts mentioned above, and of the covenants and
conditions set forth below, the parties agree as follows:
1. EMPLOYMENT.
(a) During the Term of Employment as defined in Section 2, Employer
agrees to employ Executive as an executive, subject to the
direction and control at all times of the Board of Directors of
Employer (the "Board"). Executive agrees to act in the foregoing
capacity, in accordance with the terms and conditions contained
in this Agreement. Executive will have the title of Chairman of
the Board of Employer. For so long as Executive remains an
employee of Employer, Employer shall use its best efforts to
secure the election and retention of Executive to the Board.
(b) During the Term of Employment, Executive shall devote
substantially all of his working time to Employer`s Business as
conducted from time to time. Executive shall render services and
serve on the Board, without additional compensation, in
connection with the operation of Employer`s Business, including
activities of affiliates and subsidiaries of the Employer as may
exist from time to time. Notwithstanding any of the foregoing, it
is expressly agreed and understood that Executive shall be
entitled to spend a reasonable amount of his working time on (i)
charitable activities and personal investments and (ii) other
business-related ventures subject to approval by the Board, which
shall not be unreasonably withheld.
2. TERM.
The initial term of Executive`s employment under this Agreement shall
commence on the date hereof and shall continue for a period of three
years (the "Initial Term"). Thereafter, this Agreement shall be
automatically renewed and extended for consecutive one-year renewal
terms, unless Executive provides 90 days`
written notice or Employer provides 135 days` written notice of
non-renewal prior to the expiration of the Initial Term or any renewal
term (each such one-year renewal period, a "Renewal Term"). The
Initial Term and each Renewal Term are subject to earlier termination
as set forth in Section 5. The actual term of employment is defined as
"Term of Employment."
3. COMPENSATION.
(a) For the first year of the Term of Employment, Employer shall pay
to Executive an annual base salary of $150,000.00 per annum (the
"Annual Base Salary"). Thereafter, the amount of Executive`s
Annual Base Salary shall be subject to annual review by the
Board; provided, however, that in no event shall the Annual Base
Salary be less than $150,000.00. For each year of the Term of
Employment, the Annual Base Salary shall be increased to an
amount not less than Executive`s Annual Base Salary as of the
immediately preceding year, multiplied by a fraction, not less
than one, the numerator of which is the Consumer Price Index --
Wages (the "CPIW") for the then-current January 1, and the
denominator of which is the CPIW for the immediately prior
January 1. Any amount to which Executive`s Annual Base Salary is
increased shall not be reduced after any such increase, and the
term "Annual Base Salary" as used in this Agreement shall refer
to the Annual Base Salary as so increased. All payments shall be
made in equal monthly installments, in arrears, or such other
installments as may be consistent with the payroll practices of
Employer for its senior executives.
(b) Upon commencement of employment, Executive shall be issued two
options to purchase a total of 800,000 shares of common stock of
Employer at the average closing price of such shares over the
five trading days immediately preceding the date of grant, and
otherwise subject to the terms of an equity plan of Employer, and
an award agreement between Executive and Employer. The first such
option shall be exercisable for 500,000 shares, and the option
shall be immediately fully vested and exercisable with respect of
one-half of the shares subject thereto, the option shall become
fully vested and exercisable in respect of one-quarter of the
shares subject thereto on the first anniversary of the Effective
Date, and the option shall become fully vested and exercisable on
the second anniversary of the Effective Date in respect of the
remaining one-quarter of the shares subject thereto. The second
option shall be exercisable for 300,000 shares, and the option
shall become fully vested and exercisable in respect of one-half
of the shares subject thereto on each of the first two
anniversaries of the Effective Date (with full vesting and
exercisability on the second anniversary).
(c) In addition to the compensation set forth above, Executive shall
be entitled to receive a semi-annual bonus in accordance with the
terms of the semi-annual bonus pool set forth on Exhibit A
attached hereto and incorporated herein by reference, subject to
shareholder approval intended to satisfy the rules under Section
162(m) of the Internal Revenue Code of 1986, as amended (the
"Code") for performance-based compensation, for fiscal years
ending after September 30, 2002. Employer shall use its best
efforts to procure such shareholder approval, and, failing to do
so, in consultation with Executive, Employer agrees to negotiate
in good faith with Executive for the implementation of a
reasonable alternative, for which Employer will again use its
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best efforts to obtain shareholder approval.
(d) It is expressly acknowledged and agreed that, to the extent
permitted by applicable law, any option granted to Executive
hereunder shall be qualified as an "incentive stock option," as
defined under Section 422(b) of the Code.
(e) Employer shall (i) use its best efforts to have the shares
subject to all options granted to Executive be subject to an
effective registration statement on Form S-8 or another
applicable registration form, and (ii) have all option grants be
exempt under Rule 16b-3 of the Securities and Exchange
Commission.
4. ADDITIONAL EXECUTIVE BENEFITS.
(a) Employer shall reimburse Executive in accordance with Employer`s
policies for all expenses reasonably incurred by Executive in
connection with the performance of Executive`s duties under this
Agreement; provided that Executive shall submit proof of such
expenses prior to reimbursement within a reasonable amount of
time following such expenses.
(b) Executive shall be permitted during the Term of Employment to
participate in any group life, hospitalization or disability
insurance plans, health programs, stock option plans, pension and
profit sharing plans and similar benefits that may be available
to other senior executives of Employer generally, on the same
terms as such other executives, in each case to the extent that
Executive is eligible under the terms of such plans or programs.
Notwithstanding the generality of the foregoing, Employer shall
provide and pay for the following benefits: $1,000,000 life
insurance coverage for the first year of the Term of Employment,
and commencing when Employer first has sufficient available cash
to begin paying therefor, as reasonably determined by the three
senior managers (including Executive) (i) such life insurance
shall be increased to $2,000,000 and (ii) Executive shall be
covered by disability insurance benefits equal to 60% of
Executive`s annual salary plus target bonus. Once increased, the
level of benefits and perquisites in the immediately preceding
sentence shall not be decreased without Executive`s written
consent.
5. TERMINATION.
5.1 TERMINATION FOR CAUSE; TERMINATION WITHOUT GOOD REASON.
(a) Employer may terminate this Agreement for Cause (as defined
below), and Executive may terminate his employment without Good
Reason (as defined below) upon written notice to Employer. If
Employer terminates Executive for Cause, or Executive terminates
his employment and the termination by Executive is not covered by
Section 5.2, 5.3 or 5.4, Executive shall receive Annual Base
Salary and other benefits earned and accrued under this Agreement
prior to the effective date of the termination of employment (and
reimbursement under this Agreement for expenses incurred prior to
the effective date of the termination of employment).
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(b) "Cause" within the meaning of this Agreement shall mean any one
of:
(i) Executive`s material breach of the provisions of Section 6;
(ii) Executive`s material and willful failure or refusal on more
than one occasion (in each case, of which he is made aware
in writing by Employer promptly and in no event more than
seven days after such failure or refusal) to perform
Executive`s duties in accordance with Section 1 hereof, if
there is a demonstrable adverse affect to Employer;
(iii)willful failure on more than one occasion by Executive (in
each case, of which he is made aware in writing by Employer
promptly and in no event more than seven days after such
failure) to comply in any material respect with any
reasonable written policies or directives of the Board; or
(iv) Executive is convicted of, or pleads guilty (or nolo
contendre) to, any felony (but not any traffic or similar
infraction) or crime involving fraud, misappropriation or
embezzlement against Employer;
provided that (x) no conduct by Executive shall be deemed willful for purposes
of this Section 5.1 if Executive believed in good faith that such conduct was in
or not opposed to the best interests of Employer, and (y) Cause shall in no
event be deemed to exist (1) with respect to clauses (i), (ii) and (iii) above,
unless Executive shall have first received written notice from the Board
advising Executive of the specific acts or omissions alleged to constitute a
failure or breach giving rise expressly to Cause hereunder, and such failure or
breach continues after Executive shall have had a reasonable opportunity (which
shall be defined as a period of time consisting of at least 15 days from the
date Executive receives said notice) to correct the acts or omissions so
complained of, and (2) except upon a finding reflected in a resolution of the
Board approved by at least 75% of the members of the Board, whose finding shall
not be binding upon or entitled to any deference by any court, arbitrator or
other decision-maker ruling on this Agreement, at a meeting to which Executive
(and Executive`s counsel) shall be invited upon proper notice.
5.2 TERMINATION WITHOUT CAUSE OR FOR GOOD REASON.
(a) Employer may terminate Executive`s employment at any time for any
reason or no reason and Executive may terminate Executive`s
employment with Employer for Good Reason. If Employer terminates
Executive`s employment and the termination is not covered by
Section 5.1, 5.3 or 5.4, or Executive terminates his employment
for Good Reason and the termination by Executive is not covered
by Section 5.4, (i) Executive shall receive no later than 30 days
after such termination (A) Annual Base Salary and other benefits
earned and accrued under this Agreement prior to the date of
termination (and reimbursement under this Agreement for expenses
incurred prior to the date of termination) and (B) a prorated
bonus through the date of termination based on the highest annual
bonus either paid in any prior year or potentially payable to
Executive in the year of such termination; (ii) Executive shall
be entitled to receive (A) an amount equal to the Applicable
Factor (as defined below) times Executive`s Annual Base Salary
(as in effect on the effective date of such termination), payable
no later than 30 days after such termination, (B) an amount equal
to the Applicable Factor times (x) if such termination occurs
within the first year of the Initial Term, the maximum annual
bonus that would be otherwise payable under Section 3(c) or (y)
if such termination occurs after the first year of the Initial
Term, the greater of (1) the maximum potential annual bonus
payable under 3(c) in the year of termination and (2) the highest
annual bonus paid during the Term of Employment, payable no later
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than 30 days after such termination, and (C) for a number of
years equal to the Applicable Factor after termination of
employment (x) such continuing health benefits (including any
medical, vision and dental benefits) under Employer`s health
plans and programs applicable to senior executives of Employer
generally as Executive would have received under this Agreement
(and at such costs to Executive) as would have applied in the
absence of such termination; provided that Employer shall
continue to be required to provide such coverage after such time
as Executive becomes entitled to receive health benefits from
another employer or recipient of Executive`s services to the
extent that the benefits being provided hereunder are greater
than the benefits to which Executive has subsequently become
entitled; and provided, further, that all "COBRA" continuation
periods shall commence upon the expiration of the continued
coverage provided for under this Section 5.2(b)(ii) without being
reduced by the period of such continued coverage; (y) an amount
reasonably equivalent economically to the pension and other
retirement benefits Executive would have received if Executive
remained employed for such period; and (z) continuing payment or
reimbursement for the benefits provided under Section 4(b); and
(iii) all outstanding unvested options and other equity held by
Executive shall vest and become immediately exercisable and shall
otherwise be exercisable in accordance with their terms and
Executive shall become vested in any pension or other deferred
compensation other than pension or deferred compensation under a
plan intended to be qualified under Section 401(a) or 403(a) of
the Code. The "Applicable Factor" is the greater of (i) the
number of years (including fractions thereof) remaining in the
term of employment (as determined without regard to the
termination) and (ii) 2.
(b) For purposes of this Agreement, "Good Reason" shall mean, unless
otherwise consented to in writing by Executive,
(i) the material reduction of Executive`s title, authority,
duties or responsibilities, or the assignment to Executive
of duties materially inconsistent with Executive`s positions
with Employer as stated in Section 1 hereof (including,
without limitation, a failure of Executive to continue to be
elected (after having been elected) to serve as a member of
the Board);
(ii) (A) a reduction in the Annual Base Salary of Executive
or the failure to provide for the increases thereto required
by this Agreement, (B) any failure to comply with the
provisions of Section 3(c) (relating to certain arrangements
governing bonuses), or (C) without limiting the foregoing,
any failure to pay the Annual Base Salary or any bonus to
Executive in accordance with Section 3(b) or 3(c), as
applicable if such failure is not cured by Employer within
five days of notice of such failure (provided that Employer
shall not have repeated rights to cure);
(iii) the relocation of Executive`s office to more than 25
miles from New York City;
(iv) Employer`s failure to pay Executive any amounts
otherwise due hereunder or under any plan, policy, program,
agreement, arrangement or other commitment of Employer if
such failure is not cured by Employer within 15 days of
notice of such failure;
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(v) the failure by Employer to obtain an agreement in form
and substance reasonably satisfactory to Executive from any
successor to the business of Employer to assume and agree to
perform this Agreement; or
(vi) any other material breach by Employer of this
Agreement.
(c) For purposes of this Section 5, if Executive`s employment is not
terminated under this Section 5 before the Initial Term or any
Renewal Term would otherwise expire under Section 2, then any
termination of employment at the expiration of the Term of
Employment, after a notice of non-renewal by Employer as
contemplated by Section 2, which termination is not a termination
for Cause by the Company covered by Section 5.1 and is not a
termination covered by Section 5.3 or 5.4, shall be treated as a
termination by Executive for Good Reason covered under this
Section 5.2, except that (i) the Applicable Factor for all
purposes (other than for purposes of clause (ii)(C) of Section
5.2(a)) shall be 1.5 (and shall remain as 2 in respect of such
clause), and (ii) the amount of the payments provided for under
clauses (ii)(A) and (ii)(B) of the second sentence of Section
5.2(a) shall be paid in substantially equal payments (or more
frequently if salary is paid more frequently) on a monthly basis
over the 18-month period commencing with such termination (rather
than in a lump sum) for so long as Executive complies with the
restrictions set forth in Section 6.1 (including during any part
of such 18-month period which is after the Restricted Period (as
defined below)).
5.3 TERMINATION UPON DEATH OR DISABILITY.
If Executive dies during the Term of Employment, the obligations of
Employer to or with respect to Executive shall terminate in their entirety
except as otherwise provided under this Section 5.3. If Executive becomes
disabled for purposes of Employer`s long-term disability plan, Employer shall
have the right, to the extent permitted by law, to terminate the employment of
Executive upon notice in writing to Executive; provided that Employer will have
no right to terminate Executive`s employment if, in the opinion of a qualified
physician reasonably acceptable to Employer, it is reasonably certain that
Executive will be able to resume Executive`s duties on a regular full-time basis
within 30 days of the date Executive receives notice of such termination. Upon
death or other termination of employment by virtue of disability, (i) Executive
(or Executive`s estate or beneficiaries in the case of the death of Executive)
shall receive no later than 30 days after such termination (A) Annual Base
Salary and other benefits earned and accrued under this Agreement prior to the
date of termination (and reimbursement under this Agreement for expenses
incurred prior to the date of termination) and (B) a prorated bonus through the
date of termination based on the highest annual bonus either paid in any prior
year or potentially payable to Executive in the year of such termination, (ii)
Executive (or Executive`s estate or beneficiaries in the case of the death of
Executive) shall be entitled to receive any and all applicable insurance
proceeds; and (iii) all outstanding unvested options and other equity held by
Executive shall vest and become immediately exercisable and shall otherwise be
exercisable in accordance with their terms and Executive shall become vested in
any pension or other deferred compensation other than pension or deferred
compensation under a plan intended to be qualified under Section 401(a) or
403(a) of the Code.
Notwithstanding the foregoing, this Section 5.3 shall not apply to a
termination within the six-month period to follow a Change of Control (as
defined below) on account of death or disability, but, rather, such a
termination shall be covered by Section 5.4.
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5.4 CERTAIN TERMINATIONS AFTER CHANGE OF CONTROL.
(a) If, after a Change of Control, (i) during the six-month period
immediately following a Change of Control, either Employer or
Executive terminates Executive`s employment for any reason or no
reason, or (ii) Executive is terminated at any time by Employer
without Cause or Executive terminates his employment for Good
Reason, then Executive shall receive or be entitled to (as
applicable) the payments, benefits and accelerations set forth in
Section 5.2(a), except that for purposes of this Section 5.4, the
Applicable Factor shall equal three.
(b) For purposes of this Agreement, "Change of Control" means the
occurrence of one of the following:
(i) a "person" or "group" within the meaning of Sections
13(d) and 14(d) of the Securities and Exchange Act of 1934
(the "Exchange Act"), becomes the "beneficial owner" (within
the meaning of Rule 13d-3 under the Exchange Act) of
securities of Employer (including options, warrants, rights
and convertible and exchangeable securities) representing
25% or more of the combined voting power of Employer`s then
outstanding securities in any one or more transactions;
provided, however, that purchases by employee benefit plans
of Employer or by Xxxxx Xxxxx, Xxxxxx Xxxxx, or Xxxxx Xxxxx
(or family or charitable trusts controlled thereby), or
Employer or its affiliates shall be disregarded;
(ii) the approval of any sale, lease, exchange or other
transfer (in one transaction or a series of related
transactions) of all, or substantially all, of the operating
assets of Employer, other than an internal restructuring of
Employer;
(iii) the approval of a merger or consolidation, or a
transaction having a similar effect unless such merger,
consolidation or similar transaction is with a subsidiary of
Employer or with another company, a majority of whose
outstanding capital stock is owned by the same persons or
entities who own a majority of Employer`s outstanding common
stock (the "Common Stock") at such time, where (A) Employer
is not the surviving corporation, (B) the majority of the
Common Stock of Employer is no longer held by the
stockholders of Employer immediately prior to the
transaction, or (C) Employer`s Common Stock is converted
into cash, securities or other property (other than the
common stock of a company into which Employer is merged); or
(iv) a majority of the members of the Board are not persons
who (A) had been directors of Employer for at least the
preceding 24 consecutive months or (B) when they initially
were elected to the Board, (I) were nominated (if they were
elected by the stockholders) or elected (if they were
elected by the directors) with the affirmative vote of
two-thirds of the directors who were Continuing Directors
(as defined below) at the time of the nomination or election
by the Board and (II) were not elected as a result of an
actual or threatened solicitation of proxies or consents by
a person other than the Board or an agreement intended to
avoid or settle such a proxy solicitation (the directors
described in clauses (A) and (B) being "Continuing
Directors").
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6. Non-Competition, Non-Solicitation, Non-Disclosure, Shop Rights,
XXXXXXX XXXXXXX AND JURISDICTIONAL MATTERS.
6.1 NON-COMPETITION.
As a material inducement to Employer to enter into this Agreement
and to perform its obligations hereunder, Executive covenants and agrees that
during Executive`s Term of Employment with Employer (the "Restricted Period")
and for a period of one year thereafter, neither Executive, any of Executive`s
agents nor anyone acting on Executive`s behalf, shall directly or indirectly,
either as an employee, employer, agent, investor, principal, partner,
shareholder (except as a holder of less than five percent of the issued and
outstanding voting stock of a publicly held corporation), corporate officer,
director, independent contractor, or in any other individual or representative
capacity, engage or participate in engage or participate in any entity (other
than Employer) engaged in Employer`s Business wherein Executive shall be
involved with online or electronic brokerage or trading activities or facilities
or an institutional block trading desk, in the United States or any foreign
country in which Employer has offices (other than with respect to employees
Executive brings to Employer as of the Effective Date and identifies to Employer
on such date); provided, that, nothing contained in this Section 6.1 shall
prevent Executive from participating in any activities described in Section
1(b).
6.2 NON-SOLICITATION; NON-DISPARAGEMENT.
During the Restricted Period and for a period of one year
thereafter, Executive covenants and agrees that Executive will not, directly or
indirectly, either for itself or for any other person or business entity, (i)
solicit any employee of Employer to terminate his employment with Employer
(other than with respect to employees Executive brings to Employer as of the
Effective Date and identifies to Employer on such date), or (ii) solicit any
client of Employer, other than a client that was introduced to Employer directly
by Executive as of the Effective Date and that is identified by Executive as
such, to terminate its relationship with Employer (other than with respect to
clients Executive brings to Employer as of the Effective Date and identifies to
Employer on such date). During the Restricted Period and thereafter, Executive
and Employer agree not to make any disparaging statements concerning the other
party, other than as may be required by legal process, it being understood and
agreed that this sentence is not intended to and shall not prohibit Executive
from making any comparative statement favorable to Executive in connection with
any competitive activity which is not prohibited under the terms of this
Agreement.
6.3 NON-DISCLOSURE AND NON-USE; SHOP RIGHTS.
(a) DESCRIPTION OF CONFIDENTIAL INFORMATION. For purposes of
this Section, "Confidential Information" means any
information disclosed during the Restricted Period, which is
clearly either marked or reasonably understood as being
confidential or proprietary including, but not limited to,
information disclosed in discussions between the parties in
connection with technical information, data, proposals and
other documents of Employer pertaining to its business,
products, services, finances, product designs, plans,
customer lists, public relations and other marketing
information and other unpublished information. Confidential
Information shall include all tangible materials containing
Confidential Information including, but not limited to,
written or printed documents and computer disks and tapes,
whether machine or user readable.
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(b) STANDARD OF CARE. Executive shall protect Confidential
Information from disclosure to any person other than other
Executives of Employer who have a need to know, by using the
same degree of care, but no less than a reasonable degree of
care, to prevent the unauthorized use, dissemination, or
publication of Confidential Information as Executive is
required to use to protect such Confidential Information.
(c) EXCLUSION. This Section imposes no obligation upon Executive
with respect to information that: (i) was in Executive`s
possession before receipt from Employer; (ii) is or becomes
a matter of public knowledge through no fault of Executive;
(iii) is rightfully received by Executive from a third party
who does not have a duty of confidentiality; (iv) is
disclosed under operation of law, except that Executive will
disclose only such information as is legally required and
give Employer prompt prior notice; or (v) is disclosed by
Executive with Employer`s prior written consent.
(d) INTELLECTUAL PROPERTY. Executive hereby agrees to disclose
to Employer all work product developed by Executive within
the scope of his employment, except as otherwise permitted
by the Board (the "Work Product"). Both parties acknowledge
and agree that if any Work Product or any portion thereof is
copyrightable, it will be deemed a "work made for hire," as
such term is defined in the Federal Copyright Act, 17 U.S.C.
Section 101 et seq., and Employer will own all right, title
and interest in and to the Work Product. Notwithstanding the
foregoing, Employer acknowledges and agrees (i) that
Executive brings to Employer a substantial accumulation of
ideas, concepts, know-how, techniques, data, modules,
components, designs, utilities, interfaces, templates,
subroutines, analyses, methods, algorithms, formulas,
technical information, specifications, and other
pre-existing materials used or developed by Executive in the
course of his work performed outside the scope of his
employment for Employer, and that there also exists and will
exist an accumulation of general ideas, general concepts,
general know-how, general techniques, and general methods
gained or learned by Executive during the performance of his
employment for Employer (all of the foregoing accumulations,
the "Residual Information"), and (ii) that nothing contained
in this Agreement is intended to or shall restrict Executive
from using the Residual Information for any purpose
whatsoever.
(e) STOCK TRADING. If the information disclosed hereunder is
material, non-public information about Employer, then
Executive agrees not to trade in the securities of Employer,
or in the securities of or any appropriate and relevant
third party until such time as no violation of the
applicable federal and state securities laws would result
from such securities trading.
(f) RETURN OF CONFIDENTIAL INFORMATION. Executive will
immediately destroy or return all tangible material
embodying Confidential Information (in any form and
including, without limitation, all summaries, copies and
excerpts of Confidential Information) upon the earlier of
(i) the completion or termination of the dealings between
the Employer and Executive under this Agreement or (ii) at
such time that Employer may so request.
(g) NOTICE OF BREACH. Executive shall notify Employer
immediately upon discovery of any unauthorized use or
disclosure of Confidential Information, or any other breach
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of the Agreement by Executive, and will cooperate with
Employer in every reasonable way to help Employer regain
possession of Confidential Information and prevents its
further unauthorized use.
7. REPRESENTATION BY EXECUTIVE.
Executive hereby represents and warrants that he is not a party to any
agreement, whether oral or written, which would prohibit him from being employed
by Employer.
8. INJUNCTIVE RELIEF.
The parties acknowledge that the services to be rendered hereunder by
Executive are special, unique and of extraordinary character, and that in the
event of a breach or a threatened breach of Executive of any of Executive`s
obligations under Section 6 of this Agreement, Employer will not have an
adequate remedy at law. Accordingly, in the event of any breach or threatened
breach by Executive, Employer shall be entitled to such equitable and injunctive
relief as may be available to restrain Executive and any business, firm,
partnership, individual, corporation or entity participating in the breach of
Section 6 of this Agreement. Nothing in this Agreement shall be construed as
prohibiting Employer from pursing any other remedies available at law or in
equity for such breach or threatened breach, including the recovery of damages
and the immediate termination of the employment of Executive under this
Agreement.
9. NOTICES.
All notices shall be in writing and shall be delivered personally
(including by courier), sent by facsimile transmission (with appropriate
documented receipt thereof), by overnight receipted courier service (such as UPS
or Federal Express) or sent by certified, registered or express mail, postage
prepaid, to the parties at their address set forth at the beginning of this
Agreement with Employer`s copy being sent to Employer at its then principal
office. Any such notice shall be deemed given when so delivered personally, or
if sent by facsimile transmission, when transmitted, or, if mailed, 48 hours
after the date of deposit in the mail. Any party may, by notice given in
accordance with this Section 9 to the other party, designate another address or
person for receipt of notices hereunder. Copies of any notices to be given to
Employer shall be given simultaneously to: Sichenzia Xxxx Xxxxxxxx Xxxxxxx LLP,
1065 Avenue of the Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Xxxxxxx X. Xxxxxxxx, Esq.,
10. MISCELLANEOUS.
(a) This Agreement shall be governed in all respects, including
validity, construction, interpretation and effect, by New York
law.
(b) This Agreement may be amended, superseded, canceled, renewed or
extended, and the terms hereof may be waived, only by a written
instrument signed by authorized representatives of the parties
or, in the case of a waiver, by an authorized representative of
the party waiving compliance. No such written instrument shall be
effective unless it expressly recites that it is intended to
amend, supersede, cancel, renew or extend this Agreement or to
waive compliance with one or more of the terms hereof, as the
case may be. No delay on the part of any party in exercising any
right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any waiver on the part of any party of any
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such right, power or privilege, or any single or partial exercise
of any such right, power or privilege, preclude any further
exercise thereof or the exercise of any other such right, power
or privilege. The rights and remedies herein provided are
cumulative and are not exclusive of any rights or remedies that
any party may otherwise have at law or in equity.
(c) Any controversy or claim arising out of or relating to this
Agreement or the breach of this Agreement that is not resolved by
Executive and Employer (or its affiliates, where applicable)
shall be submitted to arbitration in New York, New York in
accordance with New York law and the procedures of the American
Arbitration Association. The determination of the arbitrator(s)
shall be conclusive and binding on Employer (or its affiliates,
where applicable) and Executive and judgment may be entered on
the arbitrator(s)` award in any court having jurisdiction.
(d) Employer shall pay, at least monthly, all costs and expenses,
including attorneys` fees and disbursements, of Employer and
Executive in connection with (i) the preparation, negotiation and
execution of this Agreement and (ii) any legal proceeding,
whether or not instituted by Employer or Executive, relating to
the interpretation or enforcement of any provision of this
Agreement; provided that if Executive institutes the proceeding
and Employer prevails on each and every material issue, Executive
shall pay his own costs and expenses, and promptly (and in no
event more than 60 days after demand therefor by Employer) return
to Employer any amounts previously paid by Employer under this
Section 10(d)(ii).
(e) If any provision or any portion of any provision of this
Agreement or the application of any such provision or any portion
thereof to any person or circumstance, shall be held invalid or
unenforceable, the remaining portion of such provision and the
remaining provisions of this Agreement, or the application of
such provision or portion of such provision as is held invalid or
unenforceable to persons or circumstances other than those as to
which it is held invalid or unenforceable, shall not be affected
thereby and such provision or portion of any provision as shall
have been held invalid or unenforceable shall be deemed limited
or modified to the extent necessary to make it valid and
enforceable; in no event shall this Agreement be rendered void or
unenforceable.
(f) The headings to the Sections of this Agreement are for
convenience of reference only and shall not be given any effect
in the construction or enforcement of this Agreement.
(g) This Agreement shall inure to the benefit of and be binding upon
the successor and assigns of Employer, but no interest in this
Agreement shall be transferable in any manner by Executive. In
the event of any sale, transfer or other disposition of all or
substantially all of Employer`s assets or business, whether by
merger, consolidation or otherwise, Employer`s obligations
hereunder shall be assigned to, and assumed by, the successor or
successors of Employer; provided that Employer shall,
notwithstanding such assignment and assumption, remain liable and
otherwise responsible for the fulfillment of the terms and
conditions of this Agreement.
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(h) This Agreement constitutes the entire agreement and understanding
between the parties and supersedes all prior discussions,
agreements and undertakings, written or oral, of any and every
nature with respect thereto.
(i) This Agreement may be executed by the parties hereto in separate
counterparts which together shall constitute one and the same
instrument.
(j) In the event of the termination or expiration of this Agreement,
the provisions of Sections 5, 6, 7 and 8 hereof shall remain in
full force and effect, in accordance with their respective terms.
(k) Executive shall, at all times, be indemnified by Employer in
connection with his performance of services hereunder, at the
maximum level permitted by law. Employer shall cause Executive
(together with other officers and directors) to be covered at all
times by directors and officers liability insurance with such
coverage to be not less than $5,000,000. Employer shall continue
to indemnify Executive as provided above and maintain such
liability insurance coverage for Executive, after the Term of
Employment has ended for any claims that may be made against him
with respect to his service as a director or officer of Employer.
(l) Executive shall not be required to mitigate damages or the amount
of any payment provided for under this Agreement by seeking other
employment or otherwise, nor will any payments hereunder be
subject to offset in the event Executive does mitigate.
(m) If all, or any portion, of the payments provided under this
Agreement, either alone or together with other payments and
benefits which Executive receives or is entitled to receive from
Employer or an affiliate, would constitute an "excess parachute
payment" within the meaning of Section 280G of the Code (whether
or not under an existing plan, arrangement or other agreement)
(each such parachute payment, a "Parachute Payment"), and would
result in the imposition on Executive of an excise tax under
Section 4999 of the Code, then, in addition to any other benefits
to which Executive is entitled under this Agreement, Executive
shall be paid by Employer an amount in cash equal to the sum of
the excise taxes payable by Executive by reason of receiving
Parachute Payments plus the amount necessary to put Executive in
the same after-tax position (taking into account any and all
applicable federal, state and local excise, income or other taxes
at the highest possible applicable rates on such Parachute
Payments (including without limitation any payments under this
Section 10(m)) as if no excise taxes had been imposed with
respect to Parachute Payments (the "Parachute Gross-up"). The
amount of any payment under this Section 10(m) shall be computed
by a certified public accounting firm of national reputation
reasonably selected by Executive. If Employer desires to dispute
the computation rendered by such accounting firm, Employer may
select an alternative certified public accounting firm of
national reputation to perform the applicable computations. If
the two accounting firms cannot agree upon the computations,
Executive and Employer will jointly appoint a third certified
public accounting firm of national reputation, reasonably
acceptable to Executive and Employer, within 10 calendar days
after the two conflicting computations have been rendered. Such
third accounting firm shall be asked to determine within 30
calendar days the computation of the Parachute Gross-up to be
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paid to Executive, and payments shall be made accordingly. In any
event, Employer will pay to Executive or pay on Executive`s
behalf the Parachute Gross-up as computed by the accounting firm
initially selected by Executive by the time any taxes payable by
Executive as a result of the Parachute Payments become due, with
Executive agreeing to return the excess amount of such payment
over the final computation rendered from the process described in
this Section 10(m). Executive and Employer will provide the
accounting firms with all information which any accounting firm
reasonably deems necessary in computing the Parachute Gross-up to
be made available to Executive. The costs and expenses of all of
the accounting firms retained to perform the computations
described above shall be borne by Employer.
IN WITNESS WHEREOF, this Agreement has been executed as of the date
stated at the beginning of this Agreement.
X.X. Xxxxxx Group Inc.
By: ____________________________________
Title: ____________________________________
---------------------------------------------
Xxxxxx Xxxxx
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