Exhibit 10.7
EMPLOYMENT AGREEMENT
Employment Agreement made as of the 23rd day of April, 1999 by and between
xxxxxx-xxxxxxxxxxxx.xxx,inc. (the "Company"), a Delaware corporation, and Xxxx
Xxxxxxx, of Liverpool, New York (the "Employee").
WITNESETH:
WHEREAS, Employee is employed by the Company as its Vice President , and
as a condition of closing on an initial public offering of the Company's common
stock (the "IPO Closing") through Rockcrest Securities L.L.C. ("Rockcrest"),
Rockcrest, Employee and the Company have required that this Employment Agreement
be entered into to be effective on the IPO Closing.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
set forth below, the parties hereby agree as follows:
1. EMPLOYMENT
1.1 Position and Duties. The Company shall employ Employee to serve in
and to have the authority and responsibilities for the positions of
Vice President and to perform such other duties as relate to such
positions or for such other position and duties as the Board of
Directors of the Company (the "Board") in its discretion may from
time to time determine and assign him. The Board will have the
authority to determine the means and manner by which Employee is to
perform his duties.
1.2 Exclusiveness. The Employee shall devote substantially all of his
business time, attention and energies to the business of the Company
and the performance of his responsibilities and duties and shall
carry out such responsibilities and duties diligently and to the
best of his abilities. The Employee recognizes that the Company is
entering into this Agreement because of the Employee's expertise,
skills and talents and his agreement to devote all of such
expertise, skills and talents to the tasks assigned him pursuant to
this Agreement. The Employee agrees that he shall not engage in any
other business activities of any kind which would give rise to a
conflict of interest for the Employee with respect to his duties and
obligations to the Company.
1.3 Compliance with Policies and Laws. Employee will at all times comply
with all applicable policies, standards and regulations of the
Company as may be established from time to time and will comply with
all applicable laws and regulations.
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1.4 Personal Service. Employee's personal performance of his duties is
the essence of this Agreement. Employee's rights and obligations
under this Agreement are not assignable by Employee.
2. COMPENSATION
2.1 Base Salary. For all services to be rendered by Employee in any
capacity hereunder, including services as an officer, director,
member of any committee or any other duties assigned to him by the
directors or officers of the Company, the Company agrees to pay
Employee an initial base salary of One Hundred Fifty Thousand and
00/100 Dollars ($150,000.00) per year payable in equal bi-weekly
installments in arrears. Employee's Base Salary may be adjusted
upward at the sole discretion of the Company during the term of this
Agreement. Employee has elected to defer the payment of Fifty
Thousand and 00/100 Dollars ($50,000.00) of base salary until the
Company completes a secondary financing of at least Five Million
Dollars (5,000,000.00).
2.2 Incentive Bonus. Employee shall be entitled to participate in the
Company's Key Officer Incentive Bonus Plan if and when established
by the Board. This plan shall be established or changed as the
circumstances warrant by the Board and the amount which shall be
paid to Employee as well as when such payment will be made will
likewise be established by the Board.
2.3 Other Bonuses or Incentive Compensation. Employee may also receive
such other bonuses, grants of stock, stock options, warrants or
stock appreciation rights as may determined by the Board, in its
sole discretion.
2.4 Other Benefits. Employee shall be entitled to such fringe benefits,
including, but not limited to: vacation, sick leave, participation
in medical, disability, dental and life insurance plans and pension
or profit-sharing plans, as are customarily provided to the senior
executives of the Company as determined by the Board of Directors of
the Company and as provided by the terms of the applicable benefit
plans.
2.5 Reimbursement of Expenses. The Company shall reimburse travel,
entertainment and other expenses incurred by Employee in connection
with the performance of his duties in accordance with such policies
as may be adopted from time to time by the Company.
3. TERM OF THE AGREEMENT
Employee's employment under this Agreement will commence upon the IPO
Closing and continue, subject to early termination as provided in Paragraph 4
below, for a term of five (5) years.
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4. EARLY TERMINATION; SEVERANCE
4.1 Employee's employment under this Agreement may or will, as
appropriate, be terminated prior to the expiration of the term set
forth above in Paragraph 3 in the following circumstances:
a. Disability: If Employee is disabled and fails to perform
his duties hereunder on account of illness or other
incapacity which prevents Employee from performing his
duties for a continuous period of three hundred sixty
five days, the Company thereafter may, upon ten days
written notice, terminate Employee's employment under
this Agreement.
b. Death. In the event of the death of Employee, this
Agreement will terminate immediately.
c. By the Company for Cause. The Company may terminate
Employee's employment under this Agreement for Cause.
For purposes of this subparagraph, the Company will have
"Cause" to terminate this Agreement upon (I) the willful
and continued failure by Employee to substantially
perform his duties hereunder (other than such failure
resulting from Employee's incapacity due to physical or
mental illness), after a written demand for substantial
performance is delivered by the Company that
specifically identifies the manner in which the Company
believes the Employee has not substantially performed
his duties, or (ii) the willful engaging by the Employee
in misconduct which is materially injurious to the
Company, monetarily or otherwise, (iii) the willful
violation by Employee of the provisions of this
Agreement, (iv) a material breach of any fiduciary duty
owed by Employee to the Company or its relationships
with employees, suppliers, customers or others with whom
the Company does business or (v) the habitual or
repeated misuse of alcohol or controlled substances. For
purposes of the subparagraph, no act, or failure to act,
on Employee's part shall be considered "willful" unless
done, or omitted to be done, by him not in good faith or
without reasonable belief that his action or omission
was in the best interest of the Company. Notwithstanding
the foregoing, Employee will not be deemed to have been
terminated for Cause without reasonable notice to
Employee setting forth the reasons for the Company's
intention to terminate for Cause, an opportunity for
Employee to be heard before the Board, and thereafter, a
determination that in the good faith opinion of the
Board, "Cause" exists within the meanings set forth in
clause (I), (ii), (iii), (iv) or (v) of this
subparagraph.
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d. By Company Without Cause. The Company may terminate
Employee's employment under this Agreement unilaterally
at any time for any reason or for no reason by giving
Employee ninety (90) days advance notice of the
intention to terminate. Employee may at the sole
discretion of the Company, be relieved of his duties
during such ninety (90) day period, although Employee
must be paid during this period.
e. By Employee. Employee may terminate his employment under
this Agreement at any time upon ninety (90) days written
notice to the Company. Employee may, at the sole
discretion of the Company, be relieved of his duties
during such ninety day period, but continue to be paid
during such period.
4.2 In the event of termination of Employee's employment prior to the
end of the Term, Employee shall be entitled to a lump sum severance
payment payable on the date of termination as follows:
a. In the event the Employee's is terminated due to
Employee's death or disability, the Employee or
Employee's estate shall be entitled to a payment equal
to the sum of (i) twelve months of the then current base
salary (including accrued portions) , (ii) any accrued
salary which has not been paid , and (iii) any expense
reimbursement due and owing to him at the time of such
termination.
b. In the event the Employee's employment is terminated by
the Company without Cause as defined above, or Employee
terminates his employment for good reason (as hereafter
defined), the Employee shall be entitled to a payment
equal to the sum of (i) the greater of one year of then
current base annual salary, or the total base salary
which would be payable for the balance of the Term, and
(ii) a pro-rata portion of what the Incentive Bonus for
the then current year would be if the calculation for
the year through such date of termination annualized out
for the year would have resulted in an Incentive Bonus
for the year, and (iii) any accrued salary which has not
been paid, and (iv) any expense reimbursement due and
owing to him at the time of such termination.
c. In the event that Employee's employment is terminated by
the Company for Cause or is terminated by Employee
voluntarily prior to the end of the Term other that for
Good Reason, Employee shall not be entitled to any
severance payment.
4.3 For purposes hereof:
"Good Reason: is defined to mean (i) the Board substantially
diminishing Employee's responsibilities and activities to a degree which
is not commensurate with the position held by Employee: or (ii) the Board
taking action in material breach of this Agreement; or (iii) requiring the
Employee to relocate to anywhere other than the metropolitan Syracuse
area; or (iv) the voluntary resignation of
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Employee at any time within sixty days after a Change in Control (as
hereinafter defined)
"Change in Control: shall mean any transaction or series of
transactions (including, without limitation, a tender offer, merger or
consolidation) the result of which is that any "person" or "group" (within
the meaning of Section 13 (d) and 14 (d)(2) of the Securities Exchange Act
of 1934, as amended). Other than Xxxxxx X. Xxxxxxxxxx, or trusts for the
benefit of any of the foregoing or their respective families, and any
"person" or "group" solicited by any of such persons: (I) becomes the
beneficial owner of more than 50 percent of the total aggregate voting
power of all classes of the voting stock of the Company and/or warrants or
options to acquire such voting stock, calculated on a fully diluted basis;
or (ii) acquires all or substantially all of the assets of the Company.
5. COVENANT NOT TO COMPETE; CONFIDENTIALITY
5.1 Non-competition.
a. Employee acknowledges and understands that the Business
(as defined below) in which the Company is engaged can
be and will be effectively and efficiently conducted
anywhere in the world and the Company's business is
international in scope (as opposed to national and
regional). Therefore, as a material consideration of the
Company's entering into this Agreement, Employee agrees
that during the Term and for a period of one year
following termination of Employee's employment under
this Agreement for any reason whatsoever, in the entire
world, directly or indirectly, Employee shall not, in
any location whatsoever, (i) own (as a proprietor,
partner, stockholder, or otherwise) an interest in or
(ii) participate (as an officer, director, or in any
capacity) in the management, operation or control of, or
(iii) perform services as or act in the capacity of an
employee, independent contractor, consultant or agent of
any enterprise, which competes, or intends to compete
with the Company's Business (the "Non-Compete Covenant")
except with prior written consent of the Board, which
consent may be withheld or granted in the Board's sole
and absolute discretion. The Company's "Business" as
that term is used in this Paragraph 5.1 means the
development, manufacture, marketing, selling or
distribution of wireless phones or wireless phone
related systems.
b. Notwithstanding the foregoing, in the event that
Employee's employment is terminated due to expiration of
the Term without early termination under Section 4, and
Employee's employment is not otherwise renewed, Employee
shall not be bound to the Non-Compete Covenant unless
the Company makes the following election. The Company
shall have the option to bind Employee to the
Non-Compete Covenant for one year after the termination
of his employment due to expiration of the Term by
electing to do so and agreeing to pay to
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Employee the Non-Compete Consideration (as hereinafter
defined) in equal monthly installments over the one year
period. To make such election, the Company shall give
the Employee notice of such election (which shall
include an agreement to pay the Non-Compete
Consideration) by no later that the Election Date (as
hereinafter defined). Failure to give such notice by the
Election Date shall be deemed an election by the Company
not to bind Employee to the Non-Compete Covenant for the
one year period following the expiration of the Term. In
the event that the Company shall default on its payment
of any installment of the Non-Compete Consideration,
Employee shall be relieved from the Non-Compete
Covenant, in addition to any other rights and remedies
which Employee may have. For purposes hereof; the
"Non-Compete Consideration" is the amount equal to the
current base annual salary being paid to Employee on the
day prior to the date of expiration of the Term, and the
"Election Date" is the date which is three (3) months
prior to the date on which the Term expires.
5.2 Covenant Not to Promote Termination of Relationships. As a material
consideration for the Company's entering into this Agreement,
Employee covenants and agrees that for a period of two years
commencing on the termination of Employee's employment with the
Company, Employee shall not persuade or entice, or attempt to
persuade or entice any customer or client of the Company to
terminate its business or contractual relationship with the Company,
or refrain from establishing any such relationship with the Company.
5.3 Inducement of Breach. Employee shall promptly notify the Company if
any person, firm, partnership, limited liability company,
association, corporation or other entity attempts to induce Employee
to breach any of the terms or provisions of this Agreement.
5.4 Confidentially. Employee acknowledges and agrees that all product or
service information, marketing information, lists or identities of
the Company's customers, pricing and cost information, financial
information, technical data, technical know-how, and other
information and data related to the Company's business
("Confidential Information") are valuable assets of the Company
except for Confidential Information which is a matter of public
record through no action or fault of the Employee. Employee shall
not, during the Term or after termination of Employee's employment
hereunder for any reason whatsoever, use, divulge, disclose, or
communicate any Confidential Information to any entity, except with
the prior consent of the Board of Directors of the Company, which
consent may be withheld or granted in the Board" sole and absolute
discretion.
5.5 Return of Documents. Employee acknowledges and agrees that all
originals and copies of records, reports, documents, lists,
memoranda, notes and other documentation related to the business of
the Company or containing any Confidential Information shall be the
sole and exclusive property of the Company and shall be returned to
the Company by Employee upon
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termination of Employee's employment hereunder for any reason
whatsoever, or upon the written request of the Company at any time.
5.6 No Solicitation. As a material consideration of the Company's
entering into this agreement, Employee covenants and agrees that
during the Term and for a period of two years after the termination
of Employee's employment hereunder for any reason whatsoever,
neither Employee, nor any person or entity controlled by Employee
(including without limitation, members of Employee's family), shall
directly or indirectly; (i) solicit for employment any person
employed by, or serving as a consultant to, the Company or the
Company's affiliates, successors or assigns or (ii) solicit or aid
in the solicitation of persons or business entities with whom the
Company has done business or with whom the Company has attempted to
do business.
5.7 Equitable Relief; Other Remedies. Employee acknowledge and agrees
that it would be difficult to measure damage to the Company from any
breach by Employee of any matter described in this Section 5 of this
Agreement and that monetary damages would be an inadequate remedy
for any such breach. Accordingly, Employee agrees that if Employee
shall directly or indirectly breach or take steps preliminary to
breaching any of the provisions of this Section 5 of this Agreement,
the Company shall be entitled , in addition to all other remedies it
may have at law or in equity, to an injunction or other appropriate
orders or equitable relief to restrain any such breach, without
showing or proving any actual damaged sustained by the Company.
Employee further agrees that, for any period during which breach of
any provision of this Agreement has not been enjoined, the Company
shall be entitled, upon proof of same, to actual and consequential
damages caused by such breach, including, but not limited to loss of
business relationships, loss of goodwill and loss of prospective
business and advantage.
5.8 No Release. Employee agrees that the termination of this Agreement
shall not release Employee from any of Employee's obligations under
this Section 5, all of which survive such termination.
6. INDEMIFICATION
To the fullest extent permitted under the law, the Company will defend,
advance funds, indemnify and hold Employee harmless with respect to any expenses
incurred, claims against and other liabilities arising in connection with any
actual or threatened action, suit or proceeding, whether civil, criminal,
administrative, investigative or otherwise (including any suit proceeding by or
in the right of the Company) to which Employee is made a party, is threatened to
be made a party or is an actual or potential witness by reason of the fact that
Employee is an officer, employee, director or agent of the Company, or at the
request of the Company, an officer, employee, director or agent of any other
entity unless, in connection with such action, suit or proceeding or in
connection with the claims made therein, Employee has engaged in acts of bad
faith, willful misconduct, gross negligence or reckless disregard of his duties
to the Company or the best interests of the Company.
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7. GENERAL PROVISIONS
7.1 Entire Agreement. This Agreement contains the entire agreement and
understanding of the parties with respect to the employment of
Employee by the Company and supersedes all prior and contemporaneous
agreements between them with respect to such subject matter.
7.2 Modification. This Agreement may not be changed, modified, released,
discharged, abandoned, or otherwise amended, in whole or in part,
except by an instrument in writing, signed by an employee and an
authorized officer of the Company.
7.3 Waiver. Failure of any party at any time to require performance of
any provision of this Agreement shall not limit such party's right
to enforce such provision, nor shall any waiver of any breach of
this Agreement constitute a waiver of such provision itself. No
attempted or purposed waiver of any provision of this Agreement
shall be effective unless set forth in writing and signed by the
party to be bound.
7.4 Severability. The agreements and covenants contained in this
Agreement are severable, and in the event any of the agreements and
covenants contained in this Agreement should be held to be invalid
by an arbitrator or by any court or tribunal of competent
jurisdiction, this agreement shall be interpreted as if such valid
agreements and covenants were not contained herein; provided
however, that if any legal proceeding or arbitrator or a court shall
hold unenforceable the covenants contained in Section 5 above by
reason of their geographic extent or duration or otherwise, any such
covenant shall be reduced in scope to the extent requires by law and
enforced in its reduced form.
7.5 Governing Law. This Agreement will be governed by and constructed in
accordance with the laws of the State of New York in the County of
Onondaga.
7.6 Controversies or Disputes. Any controversy, claim, or dispute
arising under or relating to this Agreement, or that arises out of
or that is based upon the employment relationship (including any
wage claim, any claim for wrongful termination, or any claim based
upon any statue, regulation, or law including those concerning
employment discrimination, sexual harassment, civil rights, age or
disabilities), including tort claims (except a tort that is a "
compensable injury" under workers' compensation law), or a dispute
between the parties that arose or arises before, during or after
employment, other than any matter as to which a party seeks
injunctive relief, shall be resolved by a single, neutral arbitrator
in an arbitration conducted in New York in accordance with the then
current rules of commercial arbitration of the American Arbitration
Association. Employee and the Company agree that neither party is
entitled to recover punitive damages. The decision or award rendered
by the arbitrator
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shall be final, nonappealable and binding upon the parties, and
judgment may be entered upon it in accordance with applicable law in
a court of competent jurisdiction. The arbitrator shall be an
attorney with at least ten years of experience in employment law.
Arbitration in accordance with this paragraph is the sole and
exclusive method, means and procedure to resolve any and all claims
or disputes other than those seeking exclusively injunction relief.
Employee and the Company hereby irrevocably waive any and all rights
to resolve disputes in a manner contrary to the provisions of this
paragraph. Any and all attempts to circumvent the terms in this
paragraph shall be null and void and of no force and effect
whatsoever.
8. NOTICES
Any notice given pursuant this Agreement shall be in writing and shall be
deemed given on the earlier of the date the notice is (I) personally delivered
to the party to be notified, (ii) mailed, postage prepaid, certified with return
receipt requested, addressed as follows, or to such other address as a party may
from time to time designate by notice to the other party, or (iii) delivered at
the party's address via courier service.
To the Company: bright-technologies,com,inc.
0000 Xxxxxx Xxxx
Xxxxxxxxx, XX 00000
Attention: Chief Executive Officer
To the Employee: Xxxx X. Xxxxxxx
0000 Xxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
xxxxxx-xxxxxxxxxxxx.xxx,inc.
By: /s/ Xxxxxx X. Xxxxxxxxxx
-------------------------
Its Chief Executive Officer
Duly Authorized
Employee
/s/ Xxxx X. Xxxxxxx
----------------------------
Xxxx X. Xxxxxxx
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