EXHIBIT 10.7
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT (the "AGREEMENT"), is made as of
the Effective Date (as herein defined) by and between XxxxXxx.xxx, Inc., with
its principal executive office at Suite 270, Brandywine Centre II, 000 Xxxxxxx
Xxxxxxxxx, Xxxx Xxxx Xxxxx, Xxxxxxx 00000, (the "COMPANY") and Xxxxx Xxxxx, an
individual residing at 0000 Xxxxx Xxxx Xxxx, #000, Xx. Xxxxxxxxxx Xxxxx, XX
00000 (the "EXECUTIVE").
WHEREAS, the Executive has been offered the position of Chief Operating
Officer with a corporate title of Executive Vice President and will begin to
serve in such capacities on the Effective Date, and
WHEREAS, the Company wishes to assure itself of the services of the
Executive for the period provided for herein and the Executive is willing to
serve in the employ of the Company for said period upon terms and conditions
hereinafter provided; and
WHEREAS, the Company's Board of Directors has determined that the best
interests of the Company and its shareholders would be served by providing for
the terms and conditions of the Executive's employment as set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and intending to be legally bound hereby, the Company and the
Executive hereby agree as follows:
SECTION 1. GENERAL DEFINITIONS. As used herein, the following terms shall have
the meanings set forth below:
"EFFECTIVE DATE" shall mean October 2, 2000.
"IPO COMPLETION" shall mean that date certain upon which the Company
receives the proceeds from an initial public offering of the common shares of
the Company.
"PERSON" means any individual, sole proprietorship, general or limited
partnership, joint venture, trust, unincorporated organization, association,
corporation, institution, entity, party, limited liability company or government
body.
SECTION 2. EMPLOYMENT AND TERM. The Company hereby employs the Executive, and
the Executive hereby accepts such employment by the Company, for the purposes
and upon the terms and conditions contained in this Agreement and subject to the
approval of the Company's Board of Directors. Subject to the terms and
conditions contained herein, the initial term of this Agreement shall be for a
two (2) year period commencing on the date on which the Executive begins his
employment with the Company (which shall be the Effective Date) and terminating
on the second (2nd) anniversary of the Effective Date.
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Thereafter, the Company shall have the option, in its sole discretion, to renew
this Agreement on its then current terms and conditions for a subsequent one
(1) year term extension upon ninety (90) days' prior notice to the Executive.
The initial term hereof and any extension term are referred to herein as the
"EMPLOYMENT PERIOD".
SECTION 3. EMPLOYMENT CAPACITIES AND DUTIES. The Executive shall be employed
throughout the Employment Period as the Chief Operating Officer of the Company,
with a corporate title of Executive Vice President. The Executive shall have the
duties and responsibilities normally associated and incumbent with such position
and shall perform such other tasks as may reasonably be requested by the Chief
Executive Officer or the Board of Directors from time to time. Executive hereby
represents that he is able to perform the duties of Chief Operating Officer and
has no reason to believe otherwise. Subject to the direction and supervision by
the Company's Chief Executive Officer, the Executive shall supervise and manage
the day-to-day operations and business of the Company.
SECTION 4. EXECUTIVE PERFORMANCE COVENANTS. The Executive accepts the employment
described in Section 3 herein and agrees to devote his full working time and
efforts (except for authorized absences due to illness and appropriate
vacations) to the business and affairs of the Company and the performance of the
aforesaid duties and responsibilities.
SECTION 5. SALARY. In compensation for his services hereunder, the Executive
shall be paid a salary ("SALARY") for the period commencing on the Effective
Date at an annual rate of One Hundred Thousand Dollars (US $ 100,000) payable in
equal installments in accordance with the Company's payroll policies. In
addition to said Salary, the Executive shall be entitled to a performance bonus
at the end of each year equivalent to one percent (1%) of the improvement in the
Company's net income and/or loss for that twelve month period compared to the
previous twelve month period, based on the Company's GAAP unaudited financial
statements certified by its Chief Financial Officer.
SECTION 6. STOCK OPTIONS. The Company shall grant Incentive Stock Options (the
"OPTIONS") to the Executive to purchase up to Ninety Thousand (90,000) common
shares of the Company's capital stock at an exercise price of $7.00 per share,
subject to (i) vesting in accordance with the following schedule, (ii)
modification in grant and vesting pursuant to Section 9 of this Agreement; and
(iii) issuance of shares in a manner consistent with the terms and conditions of
the Company's 1999 Stock Plan. All Options granted to the Executive shall expire
on October 1, 2005 and shall vest at the rate of 7,500 Options per month. Upon
the request of the Executive, the Company will use its best efforts to effect
piggy-back registration of any Options shares in any registration statement
filed for the Company's securities pursuant to the Securities Act of 1934.
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SECTION 7. EMPLOYEE BENEFITS. During the Employment Period, in addition to any
and all compensation and benefits required or permitted to be made by the
Company to the Executive hereunder, the Executive shall receive the benefits and
enjoy the perquisites described below:
(a) Vacation. The Executive shall be entitled to two (2) weeks
paid vacation per annum to be taken at such times for such
lengths as are reasonable given the tasks of the Executive and
obligations of the Company; and
(b) Benefit Plans. The Executive shall be entitled to participate
in the Company's benefit plans, including but not limited to
group hospitalization, health, life, disability, travel or
accident insurance, restricted or stock purchase plan, stock
option plan, retirement income or pension plan, 401(k) plan or
other present or future group employee benefit plan or program
of the Company for which Executives are or shall become
eligible. Nothing contained in this Agreement shall prevent
the Board of Directors from amending or otherwise altering any
such plan, program or arrangement during the Employment
Period; and
(c) Indemnification. The Executive shall be entitled to
indemnification and protection from liability as set forth in
Section 11.
SECTION 8. REIMBURSEMENT OF EXPENSES. The Company shall reimburse the Executive
for all reasonable and necessary business expenses, including all normal and
necessary moving expenses, incurred in providing services to the Company upon
the Executive's submission of appropriate documentation evidencing such expenses
in accordance with the Company's reimbursement policies as determined from time
to time by the Company. If there is a dispute as to the eligibility of an
expense for reimbursement in accordance with the Company's reimbursement
policies, then such expense shall be determined to be reimbursable if approved
by the Chief Executive Officer.
SECTION 9. TERMINATION OF EMPLOYMENT. Any termination of the Executive's
employment by the Company or the Executive shall be communicated by a written
Notice of Termination to the other party hereto. For purposes of this Agreement,
a "NOTICE OF TERMINATION" shall mean a notice that shall indicate the provisions
in this Agreement relied upon.
(a) "EMPLOYMENT TERMINATION DATE" shall mean the date on which the
Employment Period and the Executive's right and obligation to
perform employment services for the Company shall terminate
effective upon the first to occur of the following:
(1) The expiration of the Employment Period;
(2) The death of the Executive;
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(3) If the Executive's employment is terminated by the
Company for Cause, the date on which a Notice of
Termination is given;
(4) If the Executive's employment is terminated by the
Company other than for Cause or the death of the
Executive, the date specified in the Notice of
Termination; and
(5) If the Executive's employment is terminated by
voluntary action of the Executive, the date specified
in the Notice of Termination.
(b) Termination Upon Executive's Death. In the event of the
Executive's death, the Company shall pay to the Executive's
estate any unpaid amount of Salary, benefits and un-reimbursed
expenses through the date of death.
(c) Termination for Cause. The Company may terminate the
Executive's employment hereunder and the Employment Period
for Cause. For the purposes of this Agreement, "CAUSE" shall
mean termination because of the Executive's personal
dishonesty, incompetence, willful misconduct, excessive
absences, breach of fiduciary duty involving personal profit,
failure to perform required duties, violation of any law, rule
or regulation (other than traffic violations or similar
offenses) or the material breach of any provision of this
Agreement. If the Executive's employment is terminated for
Cause, the Company shall pay the Executive (or his successors)
his unpaid Salary, benefits and un-reimbursed expenses through
the Employment Termination Date.
(d) Compensation Upon Termination by Company Other Than for Cause.
If the Company shall terminate the Executive's employment
after its ninety (90) day probationary period for any reason
other than pursuant to Sections 9(b) or 9(c), then the Company
shall pay to the Executive his unpaid Salary, benefits and un-
reimbursed expenses. Further, the Company shall immediately
vest all unvested Options in accordance with the grants
provided in Section 6 as would have been paid during the
tenure of this Agreement had the Executive not been
terminated, and allow the Executive one year from the
Employment Termination Date in which to exercise such Options.
(e) Termination by Executive. In the event that the Executive
voluntarily terminates his employment with the Company prior
to the expiration of the Employment Period, the Executive
shall be entitle only to the payment of the amounts which
would be payable to him under Section 9(c) above as if he had
been terminated for cause. However, in the event that the
Executive terminates his employment with the Company prior to
the expiration of the Employment Period due to a material
adverse change in the condition of his employment, and such
adverse change is confirmed by an independent arbitrator to be
a reasonable reason to resign, then the Executive shall be
entitled to Severance Pay. For the purposes of this Agreement,
"SEVERANCE PAY" shall mean Salary equivalent to one week's
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salary for each completed month of service, but not to exceed
the completion of the Company's Salary obligations during the
Employment Period.
SECTION 10. COMPANY PROTECTION PROVISIONS. The following provisions apply for
the protection of the Company and shall survive indefinitely beyond the duration
of this Agreement:
(a) Non-Competition. During the Restricted Period (as hereinafter
defined), the Executive shall not directly or indirectly
compete with the Company by owning, managing, controlling or
participating in the ownership, management or control of, or
be employed or engaged by or otherwise affiliated or
associated with any Competitive Business in any location in
which the Company is doing business as of the Employment
Termination Date. As used herein, the term "RESTRICTED PERIOD"
means the Employment Period and a period of six months
thereafter. As used herein, a "Competitive Business" is any
other corporation, limited liability company, partnership,
proprietorship, firm, association or other business entity
that is engaged in any business from which the Company has
derived more than 10% of its revenues during the twelve months
preceding the Employment Termination Date or in which the
Company has invested 10% or more of its total assets as of the
time in question.
(b) Non-Interference. During the Restricted Period, the Executive
shall not induce or solicit any employee of the Company or any
person doing business with the Company to terminate his or her
employment or business relationship with the Company or
otherwise interfere with any such relationship.
(c) Confidentiality. The Executive agrees and acknowledges that,
by reason of the nature of his duties as an officer and
employee, he will have or may have access to and become
informed of confidential and secret information which is a
competitive asset of the Company ("CONFIDENTIAL
INFORMATION"), including without limitation any lists of
customers or subscribers, financial statistics, research data
or any other statistics and plans contained in profit plans,
capital plans, critical issue plans, strategic plans or
marketing or operation plans or other trade secrets of the
Company and any of the foregoing which belong to any person or
company to which the Executive has access by reason of his
employment relationship with the Company. The Executive agrees
faithfully to keep in strict confidence, and not, either
directly or indirectly, to make known, divulge, reveal,
furnish, make available or use (except for use in the regular
course of his employment duties) any such Confidential
Information. The Executive acknowledges that all manuals,
instruction books, price lists, experiment logs or papers,
information and records and other information and aids
relating to the Company's business, and any and all other
documents containing Confidential Information furnished to
the Executive by the Company or otherwise acquired or
developed by the Executive, shall at all times be the property
of the
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Company. Upon termination of the Employment Period, the
Executive shall return to the Company any such property or
documents which are in his possession, custody or control, but
his obligation of confidentiality shall survive such
termination of Employment Period until and unless any such
Confidential Information shall have become, through no fault
of the Executive, generally known to the trade. The
obligations of the Executive under this subsection are in
addition to, and not in limitation or preemption of, all other
obligations of confidentiality that the Executive may have to
the Company under general legal or equitable principles.
(d) Remedies. It is expressly agreed by the Executive and the
Company that these provisions are reasonable for purposes of
preserving for the Company its business, goodwill and
proprietary information. It is also agreed that if any
provision is found by a court having jurisdiction to be
unreasonable because of scope, area or time, then that
provision shall be amended to correspond in scope, area or
time to that considered reasonable by a court and as amended
shall be enforced and the remaining provisions shall remain
effective. In the event of any breach of these provisions by
the Executive, the parties recognize and acknowledge that a
remedy at law will be inadequate and the Company may suffer
irreparable injury. The Executive acknowledges that the
services to be rendered by him are of a character giving them
peculiar value, the loss of which cannot be adequately
compensated for in damages; accordingly, the Executive
consents to injunctive and other appropriate equitable relief
without the posting of any type of bond or surety upon the
initiation of proceedings therefore by the Company in order to
protect the Company's rights. Such relief shall be in addition
to any other relief to which the Company may be entitled at
law or in equity.
SECTION 11. INDEMNIFICATION. As an officer of the Company, the Executive shall
be indemnified by the Company in accordance with the indemnification provisions
of the Company's Bylaws, and otherwise to the extent to which officers of a
corporation registered under the laws of Florida may be indemnified pursuant to
Section 607.0850 of the Florida statutes and to the extent to which officers of
a corporation organized under the laws of Nevada may be indemnified pursuant to
Nevada statutes.
SECTION 12. SUCCESSORS AND ASSIGNS. Except as hereinafter expressly provided,
the agreements, covenants, terms and provisions of this Agreement shall bind the
respective heirs, executors, administrators, successors and assigns of the
parties. This Agreement is personal in nature and neither of the parties shall,
without the consent of the other, assign or transfer this Agreement or any
rights or obligations hereunder, except as provided in this Section 12. Without
limiting the foregoing, the Executive's right to receive payments hereunder
shall not be assignable or transferable, whether by pledge, creation of
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a security interest or otherwise, and in the event of any attempted assignment
or transfer in contravention of this Section 12, the Company shall have no
liability to pay to the purported assignee or transferee any amount so attempted
to be assigned or transferred.
SECTION 13. NOTICES. All notices and other communications that are required or
may be given under this Agreement shall be in writing and shall be delivered
personally or by express mail or by certified mail addressed to the party
concerned at the addresses noted below, or as notified in writing, if changed.
All notices shall be effective upon receipt.
If to the Company: XxxxXxx.xxx, Inc.
Suite 270 Brandywine Centre II
000 Xxxxxxx Xxxxxxxxx
Xxxx Xxxx Xxxxx, XX 00000
If to the Executive: Xxxxx Xxxxx
0000 Xxxxx Xxxx Xxxx - #000
Xx. Xxxxxxxxxx, XX 00000
SECTION 14. WAIVER; REMEDIES CUMULATIVE. No waiver of any right or option
hereunder by any party shall operate as a waiver of any other right or option,
or the same right or option as respects any subsequent occasion for its
exercise, or of any legal remedy. No waiver by any party of any breach of this
Agreement or of any agreement or covenant contained herein shall be held to
constitute a waiver of any other breach or a continuation of the same breach.
All remedies provided in this Agreement are in addition to all other remedies
provided under this Agreement or applicable law.
SECTION 15. GOVERNING LAW; SEVERABILITY. This Agreement is made and is expected
to be performed in Palm Beach County, Florida, and the various terms,
provisions, covenants and agreements, and the performance thereof, shall be
construed, interpreted and enforced under and with reference to the laws of the
State of Florida. It is the intention of the Company and the Executive to fully
comply with all laws and matters of public policy relating to employment
agreements and restrictive covenants, and this Agreement shall be construed
consistently with such laws and public policy to the extent possible. If any one
or more covenants, agreements, terms or provisions of this Agreement or any
portion or portions thereof shall be held invalid or unenforceable by a court of
competent jurisdiction, then such covenants, agreements, terms or provisions (or
portions thereof) shall be deemed separable from the remaining covenants,
agreements, terms or provisions of this Agreement and such holding shall in no
way affect the validity or enforceability of any of the other covenants,
agreements, terms or provisions hereof.
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SECTION 16. JURISDICTION AND VENUE. The parties acknowledge that a substantial
portion of negotiations, anticipated performance and execution of this Agreement
occurred or shall occur in Palm Beach County, Florida, and that, therefore,
without limiting the jurisdiction or venue of any other federal or state courts,
each of the parties irrevocably and unconditionally (a) agrees that any suit,
action or legal proceeding must be brought in Palm Beach County, Florida; (b)
consents to the jurisdiction of such court in any suit, action or proceeding;
(c) waives any objection which it may have to the laying of venue of any such
suit, action or proceeding in any of such courts; and (d) agrees that service of
any court paper may be effected on such party by mail, as provided in this
Agreement, or in such other manner as may be provided under applicable laws or
court rules in the State of Florida. Notwithstanding the above, the parties
hereto agree that any controversy, claim or dispute arising out of the terms of
this Agreement, or the breach thereof, shall be settled by arbitration in Palm
Beach County under the rules of the American Arbitration Association.
SECTION 17. MISCELLANEOUS. This Agreement constitutes the entire understanding
of the parties hereto with respect to the subject matter hereof. This Agreement
may not be modified, changed or amended except in a writing signed by each of
the parties hereto. This Agreement may be signed in multiple counterparts, each
of which shall be deemed an original hereof. The captions of the several
sections and the subsections of this Agreement are not part of the context
hereof, are inserted only for convenience in locating such subsections and shall
be ignored in construing this Agreement.
SIGNATURE PAGE TO FOLLOW
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IN WITNESS WHEREOF, the Company and the Executive have executed this
Agreement as of the Effective Date.
XXXXXXX.XXX, INC.
BY: /s/ Xxxxxxxxxxx Xxxxx
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ITS: /s/ President
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WITNESS:
/s/ Xxxxx X. Xxxxxx
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XXXXX XXXXX
BY: /s/ Xxxxx Xxxxx
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WITNESS:
/s/
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