EXHIBIT 10.6
EMPLOYMENT AGREEMENT
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This employment agreement ("Agreement") dated as of the 1st day of
May, 1997, between Universal Heights, Inc. ("Universal") a corporation organized
and existing under and by virtue of the laws of the State of Delaware, having
its principal place of business at 00000 XX 00xx Xxxxxx, Xxxxx, Xxxxxxx 00000
(hereinafter referred to as the "Company"), and Xxxxxxx X. Xxxxx, who resides at
00000 Xxxx Xxxxxxx Xxxx Xxxxx, Xxxxxxxx, Xxxxxxx 00000 (hereinafter referred to
as "Employee").
W I T N E S E T H:
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WHEREAS, the Company is engaged in the sporting goods industry and
will be engaged in the investment and financial services industry; and
WHEREAS, the employee is running the sporting goods divison and will
develop and run the Company's activities in the investment and financial
services industry; and
WHEREAS, the Company is desirous of employing the Employee to run
the sporting goods division and provide assistance to the Company in the
development of its investment and financial services activities, and the
Employee is desirous of being employed by the Company to assist it in the
development of its investment and financial services activities; and
WHEREAS, the Company and Employee desire to enter into this
Agreement so that the rights, duties, benefits and obligations of each in
respect of the employment of the Employee for and by the Company will be fully
set forth under the terms and conditions stated herein upon the execution
hereof; and
WHEREAS, the Board of Directors of the Company, and the Compensation
and Stock Option Committee of the Board of Directors of the Company have
approved the employment of the Employee upon the terms and conditions set forth
herein by a resolution issued by it, and have authorized the execution and
delivery of this Agreement.
NOW, therefore, in consideration of the mutual promises contained
herein, the payment of Ten ($10.00) dollars by each party to the other, the
receipt of which is hereby duly acknowledged, and for other good and valuable
consideration, the Company and Employee agree as follows:
1. EMPLOYMENT
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The Company hereby employs the Employee in an executive
capacity, specifically as "President" and as the Company's "Chief Executive
Officer." The Employee hereby accepts such employment and agrees to perform the
services and duties specified herein.
2. TERM
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(a) The term of this Agreement ("Term") shall be for a period
of Four (4) years from the date hereof, unless sooner terminated in accordance
with the terms and conditions set forth herein. The Employee shall have an
option to extend this Agreement for an additional term of Two (2) years, under
the same terms and conditions as are contained herein.
(b) Upon the mutual agreement of the Employee and the Company,
the Term may be extended for an additional period of years, either upon the
terms and conditions set forth herein, or upon any other terms and conditions as
may be mutually agreed in writing between the Employee and the Company. The
foregoing notwithstanding, this Agreement shall terminate as provided for in
Article 2(a), and there shall not be any automatic renewal or other similar
extension of the Term.
3. DISABILITY
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If, during the Term, the Employee shall become unable to
perform his duties as provided for herein by reason of illness or injury, for a
consecutive period of Three Hundred Sixty Five (365) days, the Company may, on
Thirty (30) days written notice to the Employee, terminate the officership held
by Employee. In the event of such termination, then Employee shall remain an
employee of the Company and receive Seventy (70%) percent of his compensation
and all of his fringe benefits as is set forth below in this Agreement at
paragraphs "6" and "8" respectively.
4. TERMINATION FOR CAUSE
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This Agreement may be immediately terminated by the Company
for "cause" at any time, upon written notice to the Employee, after which all
obligations of the Company to the Employee shall thereupon cease. For the
purposes of this Agreement, the term "cause" when used with reference to the
termination of this Agreement, shall mean only any or all of the following:
(a) Employee's absence from his employment, for any reason
other than sickness or injury, at substantially all times during a period of
Ninety (90) consecutive days;
(b) Failure on the part of the Employee to (i) follow material
instructions or policy of the Board of Directors given or adopted in good faith,
or (ii) carry out an agreed policy or course of action as determined by (a) the
Board of Directors or (b) a committee of the Board of Directors, any or all of
which is or may be to the detriment of the Company; or
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(c) Willful misconduct or gross negligence of the Employee in
connection with the performance of his duties.
5. DUTIES
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(a) The Employee shall perform the following duties in
connection with his employment, all of which shall be subject to the paramount
directions of the Board of Directors:
(i) To serve as "President" and to be the "Chief
Executive Officer" of the Company; and
(ii) To assist the Company in its business affairs, run
the sporting goods division, and develop and run its investment and financial
services activities, as well as in the Company's dealings with other companies,
its regulatory affairs, banking and other financial institutions and other
groups and institutions; and
(iii) To undertake such specific assignments, consistent
with his office and position, as may be given to him from time to time by the
Board of Directors; and
(iv) To continue to serve as a director of the Company,
and then as, if and when so re-elected, to continue to serve as a director of
the Company, and also if so elected, to serve as a director of any subsidiary or
affiliate of the Company.
(b) Employee shall devote his best efforts and skills to the
affairs of the Company, and to the performance of the duties set forth in this
Article 5, on a substantially full-time basis. The Employee shall not
participate in any outside business activity that will either (i) interfere
with, or (ii) be a conflict of interest with the performance of the Employee's
duties, activities and employment pursuant to this Agreement. The foregoing
notwithstanding, the Employee has disclosed to the Company his other outside
business interests ("Outside Business Interests") which are listed on Schedule
"1" hereto and the Company with this full knowledge has consented to the
Employee's continuance thereof. Moreover, the Company agrees to permit the
Employee to involve himself in other similar Outside Business Interests, on
condition that they similarly be disclosed and are added to Schedule "1" prior
to their being commenced. The Employee may also invest his assets and devote
such reasonable time as is necessary to do so, so as to manage, protect and
support the profitability of those invested assets.
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6. COMPENSATION
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(a) BASE SALARY
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The Employee shall receive from the Company, or any of its
subsidiaries, for the discharge of the Employees duties and activities on behalf
of the Company as provided for herein, an annual salary ("Base Salary") of Two
Hundred fifty Thousand ($250,000.00) dollars, which shall be paid by the Company
to the Employee in equal and regular installments not less frequently than
monthly, in accordance with the Company's policy for payment of executive
salaries.
(b) ANNUAL BONUS
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The Employee shall receive an annual bonus of three (3%)
percent of the Company's pre-tax income up to five million ($5,000,000) dollars,
and four (4%) percent of the Company's pre-tax income over five million
($5,000,000) dollars
(c) SIGNING STOCK OPTION BONUS
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The Employee upon the execution of this Agreement, shall be
granted an issuance of One Million Five Hundred Thousand (1,500,000) options to
purchase shares of common capital stock of the Company (the "Options"). The
Options shall be granted immediately, and vest as follows: (i) Five Hundred
Thousand (500,000) on the date of the grant, (ii) Five Hundred Thousand
(500,000) on the first anniversary of the grant, and (iii) Five Hundred Thousand
(500,000) on the second anniversary of the grant.
7. OPTIONS
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The Employee from time to time shall be granted as additional
compensation stock options ("Options's") to purchase shares of the Company's
Common ("Grant"). The Grant of the Options's shall be made pursuant to the
Company's 199_ Stock Option Plan, as may be amended from time to time ("Plan").
The Company shall enter into an option agreement for the issuance of the
Options's, which option agreement shall be subject to the terms and conditions
contained in the Plan.
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8. FRINGE BENEFITS
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In addition to the Base Compensation set forth in Article 6
above, the Employee shall be entitled to receive the following benefits:
(a) Any benefits under group hospitalization, health, dental
care or sick leave plan, life or other insurance or death benefit plan, travel
or accident insurance, or contingent compensation plan, or any other present or
future plan, including any qualified retirement plan, for which any executives
are or shall become eligible. In the event the Employee is not eligible for
health benefits as described above, by reason of age, location or otherwise the
Employee shall be provided equivalent benefits determined at the election of the
Company. The Employee shall be eligible to receive the foregoing benefits during
the five (5) years period following the termination of his employment under this
Agreement; and
(b) An annual vacation of either or a combination of (i) up to
Four (4) consecutive weeks or (ii) up to any Thirty (30) days ("Vacation
Period"), at such time or times as shall be approved by the Company, and which
approval shall not be unreasonably refused. Full compensation shall be paid
during any Vacation Period. Any portion of any Vacation Period not used within
any year shall be accrued and will accumulate, and may be used by the Employee
at any time during his employment in accordance with the provisions of this
Article 8. In the event that the Employee has not used all of his accrued and
accumulated vacation time at the termination of his employment, then the
employee may then elect to have his accrued and accumulated Vacation Period time
converted to annual Base Salary, pro rata at the then prevailing Base Salary,
regardless of when the unused vacation time accrued; and
(c) The Employee may incur and shall be reimbursed for
reasonable expenses which are related to the Company's business, including
expenses for entertainment, travel and similar items ("Approved Reimbursable
Expenses"). All such reimbursement of Approved Reimbursable Expenses shall be
made within Thirty (30) days of receipt by the Company from the Employee of an
itemized account and if necessary proper substantiation of Approved Reimbursable
Expenses. In order to facilitate the payment of the Approved Reimbursable
Expenses, the Company shall furnish the Employee with Company acquired credit
cards as may be available to all other executive officers of the Company; and
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(d) The Employee shall be given a private office with
secretarial help and any and all reasonable facilities and services so as to be
suitable with his position as President and Chief Executive Officer, and so as
to assist in the performance of his duties and activities.
(e) The Employee shall be given an automobile allowance or
automobile lease plan to the extent of $7,500.00 PER ANNUM, paid in Twelve equal
monthly installments, to be used to defray acquisition expense for a luxury
automobile, and insurance and maintenance expenses for the automobile.
9. DISCLOSURE OF INFORMATION AND NON-COMPETITION
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(a) The Employee recognizes and acknowledges that during the
course of his employment he will have access to certain confidential information
of the Company and that such information constitutes valuable, special and
unique property of the Company. During the term of this Agreement and following
termination of his employment hereunder, the Employee will not disclose
information, including any trade secrets or confidential information of the
Company obtained during the course of his employment with the Company, except
such information as may have become part of the public domain through no fault
of the Employee, which public domain determination shall only be made by the
Company in a written acknowledgement made at the request of the Employee, before
the Employee may be free to disclose any such claimed public domain information.
(b) During the term of this Agreement, and for Two (2) years
thereafter, the Employee will not, directly or indirectly, engage in any
business enterprise or activity competitive with the business of the Company
either as an employee, consultant, partner, shareholder, or in any other
capacity. For the purposes of this covenant not to compete, a competing business
enterprise will be deemed competitive only if such business enterprise conducts
activities in the development of investments and financial services similar to
the activities of the Company. Further, the Employee agrees that he will not
either during or within Two (2) years subsequent to the termination of his
employment, disturb, entice, hire or in any other manner attempt to persuade any
employee, dealer, supplier or customer of the Company to discontinue its
business relationship with the Company.
(c) The Employer and the Company acknowledge that it would be
very difficult or impossible to measure the damages resulting from a breach of
this Article 9, and that any such breach would cause immediate and irreparable
harm. Therefore, in consequence of the foregoing, the Employee hereby agrees
that any breach or threatened breach by him of any provision of this Article 9
shall entitle the Company, in addition to any other legal remedies available to
it, to obtain from any Court of competent jurisdiction a temporary and permanent
injunction in order to enjoin such breach or threatened breach, without the
necessity on the part of the Company, in any application for such injunctive
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relief to show immediate and irreparable harm, which would be a requirement of
such an application absent this covenant waiving those requirements. The
Employee also covenants that the service of any papers to commence any legal
proceedings including proceedings to obtain injunctive relief, may be done by
utilizing Federal Express in lieu of any other form of personal delivery of the
process or orders of the Court and upon doing so the service and notice
provisions for the commencement of legal proceedings shall be satisfied.
10. DEATH DURING EMPLOYMENT
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If the Employee dies during the term of his employment, the
Company shall pay to his estate compensation which would otherwise be payable to
the Employee for the shorter of (i) Three (3) years from the date of his death,
or (ii) through to the termination date of this Agreement. Said sums shall be
paid in accordance with written directions given by the Employee to the Company,
or lacking any such directions then to the surviving spouse of the Employee, or
if there is no surviving spouse, then to his surviving children in equal shares,
or if there are none, then to his estate.
11. PATENTS, COPYRIGHTS AND PROPRIETARY RIGHTS
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During the Term of employment all work product emanating
directly and/or indirectly from the Employees duties and activities effected on
behalf of the Company ("Work Product"), shall be exclusively owned by the
Company. In the event that any such Work Product is the subject of an
application for patent, copyright, trade xxxx or similar proprietary protection
("Application"), then regardless of the name of the person or entity submitting
the Application, the Employee hereby acknowledges the Company's exclusive rights
in and to the Application for proprietary protection. In the event that the
Application results in the issuance of the requested proprietary protection,
E.G., a patent or copyright, then the Employee hereby acknowledges the Company's
exclusive ownership therein, and the employee will execute any documents
necessary to give effect and implement this ownership, including but not limited
to an assignment of the Application and/or the issued proprietary protection.
12. NOTICES
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Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and actually delivered, or if sent
either by Federal Express, or postage prepaid, by certified mail, return receipt
requested, with a copy by ordinary mail, to the addresses below:
As to Company: 00000 XX 00xx Xxxxxx
Xxxxx, Xxxxxxx 00000
As to Employee: 00000 Xxxx Xxxxxxx Xxxx Xxxxx
Xxxxxxxx, Xxxxxxx 00000
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or to such other address as either party shall designate by written notice to
the other.
13. ASSIGNMENT
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The rights and obligations of the Company under this Agreement
shall inure to the benefit of and shall be binding upon the successors and
assigns of the Company. The Employee acknowledges that the services to be
rendered by him are unique and personal, and accordingly, he may not assign any
of his rights, duties, obligations or benefits under this Agreement.
14. ENTIRE AGREEMENT
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This Agreement contains the entire agreement and understanding
of the Company and the Employee with respect to the subject matter hereof, and
shall incorporate, merge and supersede all prior agreements and understandings
had between the Company and the Employee, either oral or written, if any. No
modification, change or amendment to this Agreement, shall be binding upon the
Company or the Employee unless the same is in writing, and signed by the party
against whom enforcement of the modification, change or amendment is sought to
be enforced.
15. MISCELLANEOUS
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(a) This Agreement and the implementation of it shall be
subject to and governed by the laws of the State of Florida, and any legal
proceedings relating to (i) the interpretation or enforcement of any of the
provisions of this Agreement, or (ii) any dispute relating to the employment
relationship created by the Agreement, shall only be brought in the Circuit
Court of the State of Florida, in and for the County of Dade.
(b) The Article headings contained herein are for reference
purposes only and shall not in any way affect the meaning or the interpretation
of this Agreement.
(c) The failure of any provision of this Agreement shall in no
manner affect the right to enforce the remainder of this Agreement, and the
waiver by either The Company or the Employee of any breach of any provision of
this Agreement shall not be construed to be a waiver by the Company or the
Employee of any succeeding breach of such provision or a waiver by such party of
any breach of any other provision of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement
on August 6, 1997 as of May 1, 1997.
EMPLOYEE:
Witness:
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Xxxxxxx X. Xxxxx
COMPANY:
UNIVERSAL HEIGHTS, INC.
Witness:
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------------------------------ By:
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SCHEDULE 1
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OUTSIDE BUSINESS INTERESTS
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As of execution date:
UNIVERSAL HEIGHTS, INC.
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By:
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Xxxxxxx X. Xxxxx
Dated: August 6, 1997
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