Exhibit 10.11
AGREEMENT
THIS AGREEMENT ("Agreement") is entered into and is effective as of March
30, 2007, by and between XXXXX INDUSTRIES INCORPORATED ("Company"), a Delaware
corporation, and XXXXX X. XXXXX, an individual resident in the State of Florida
("Xx. Xxxxx").
PREAMBLE
WHEREAS, Xx. Xxxxx has been elected to serve as Chairman of the Board
("Chairman") by the Board of Directors of the Company (the "Board") and the
other Board wish to encourage his efforts on behalf of the Company by providing
the compensation set forth herein; and
WHEREAS, Xx. Xxxxx is willing to serve in the capacity of Chairman,
subject to the following terms and conditions.
THE AGREEMENT
NOW, THEREFORE, in consideration of the mutual promises and agreements
hereby exchanged, the Company and Xx. Xxxxx (collectively the "Parties"), hereby
agree as follows:
1. Term; Obligations to the Company.
a. Xx. Xxxxx commenced serving as Chairman on March 16, 2007 (the
"Effective Date"), and will serve as Chairman until the earlier of the date (i)
that Xx. Xxxxx ceases to be a director of the Company, (ii) that his successor
as Chairman is elected by the Board and accepts the responsibility to serve as
Chairman as provided in the Company's bylaws in effect as of such date, (iii) of
his resignation as Chairman, (iv) of his removal as provided in this Agreement,
or (v) of his death or Disability (defined below) (the "Term"). Xx. Xxxxx'x
resignation of or removal from the office of Chairman as provided in this
section shall not, of itself, alter or affect his status as a member of the
Board. Further, the term of this Agreement need not necessarily correspond with
the term of Xx. Xxxxx'x service as Chairman.
b. Xx. Xxxxx shall have such authority, responsibilities, and duties as
are normally associated with the chairman of a company similar to the Company,
together with such other duties which are, in good faith, delegated by the
bylaws of the Company or are assigned to him by majority vote of the members of
the Board. Xx. Xxxxx agrees to use his reasonable business judgment to loyally
and conscientiously perform all of the duties and obligations required of and
from him pursuant to the express and implicit terms of this Agreement. Xx. Xxxxx
shall report to the Board and to such Committee as may be designated from time
to time for such purpose by the Board. Nothing in this Agreement will prevent
Xx. Xxxxx (1) from serving as an employee, officer or director of any other
company, provided that such performance is consistent with Xx. Xxxxx'x duty of
loyalty to the Company, (2) from serving on voluntary, community service
committees and boards, and (3) from owning shares valued at less than $250,000
representing less than 5% of the outstanding equity securities of a competitive
company whose stock is listed on a national stock exchange or the NASDAQ
National Market. Xx. Xxxxx will comply with and be bound by the Company's
operating policies, procedures and practices from time to time in effect during
the Term.
1
c. Conflicts. Xx. Xxxxx represents that his performance of all the terms
of this Agreement will not conflict with or breach any other agreement to which
he is a party or may be bound. Xx. Xxxxx has not, and will not during the term
of this Agreement, enter into any oral or written agreement in conflict with any
of the provisions of this Agreement. Xx. Xxxxx represents and warrants that he
is not bound by any agreements which prohibit or restrict him from: (a)
competing with, or in any way participating in a business that competes with,
any former employer or business of any former employer to the extent that Xx.
Xxxxx'x performance of his duties under this Agreement would be deemed to
constitute such competition; (b) soliciting personnel of a former employer or
business to leave such former employer's employment or to leave such business;
or (c) soliciting customers, suppliers, financing sources or other entities
having a substantial relationship with a former employer or business.
2. Fees. For the duties and services to be performed by him under this
Agreement, the Company shall pay to Xx. Xxxxx, and Xx. Xxxxx agrees to accept,
the compensation described below in this Section 2.
a. Fees. Commencing as of the Effective Date, Xx. Xxxxx will be paid a
director's fee at the rate of $175,000.00 per year (the "Fee"). The Fee shall be
payable no less frequently than monthly. The Fee shall be reviewed by the Board
or an appropriate committee thereof no less often than annually. The review
shall take into account the projected and historical scope of Xx. Xxxxx'x
responsibility as Chairman, the time devoted to his responsibilities as
Chairman, and such other matters as the Board may consider relevant. If the Fee
is adjusted, such adjusted amount shall thereafter become the "Fee" for the
purposes of this Agreement.
b. Bonus. In addition to the Fee, promptly after the date hereof Xx. Xxxxx
will be paid $15,000. In addition, Xx. Xxxxx may receive an annual bonus in cash
or stock at the sole discretion of the Board of Directors or an appropriate
committee thereof.
c. Limitation on Other Fees. During such period that Xx. Xxxxx is
receiving the Fee, he shall continue to receive the "per meeting" fees paid to
other Board members, but shall not receive such annual retainer, committee fees
and chairmanship fees as may be paid to other Board members.
d. Equity Component. In addition to the Fee, Xx. Xxxxx shall receive Two
Hundred Thousand (200,000) shares of the Company's common stock pursuant to the
form of restricted stock agreement attached to this Agreement as Exhibit A.
2
3. Expenses. Xx. Xxxxx shall be reimbursed by the Company for reasonable
expenses incurred by him in furtherance of his performance of duties hereunder,
provided that such expenses are substantiated in accordance with Company
policies.
4. Office. In connection with the performance of his responsibilities and
duties, the Company will supply Xx. Xxxxx with services, staff and facilities
reasonably appropriate to carry out such responsibilities and duties as his
position from time to time requires, including, but not limited to, adequate
computing and mobile communication devices and support. The Company, will, on an
annual basis during the Term, provide one new laptop computer system of Xx.
Xxxxx'x choosing for his use.
5. Fringe and Medical Benefits. Xx. Xxxxx will be eligible to participate in any
of the Company's medical, dental and other benefit programs as are available to
independent members of the Board.
6. Term.
a. Term. The term of this Agreement shall commence as of the date hereof
and shall terminate on December 31, 2007, provided if Xx. Xxxxx'x tenure as
Chairman shall end earlier, this Agreement shall terminate on the date he ceases
to serve as Chairman.
b. Termination by Reason of Death or Disability.
1. In the event that Xx. Xxxxx'x tenure as Chairman with the Company
terminates as a result of his death or Disability (as defined below), he
or his estate or representative will receive all fees accrued as of the
date of Xx. Xxxxx'x death or Disability and any other benefits payable
under the Company's then existing benefit plans and policies in accordance
with such plans and policies in effect on the date of death or Disability
and in accordance with applicable law.
2. Definition of Disability. For purposes of this Agreement,
"Disability" shall mean that Xx. Xxxxx, in the reasonable determination of
the Board, has been unable to perform his duties hereunder as the result
of his incapacity due to physical or mental illness, incapacity or
disability and such inability continues for at least 90 consecutive
calendar days or 120 calendar days during any consecutive twelve-month
period; provided, that any days of disability separated by ten (10) or
fewer days shall be considered continuous. During any period when Xx.
Xxxxx implicitly or explicitly purports to be unable to perform his duties
hereunder by reason of physical or mental illness, incapacity or
disability, Xx. Xxxxx, at the request of the Company, shall submit to one
or more examinations by a physician of the Company's choice acceptable to
Xx. Xxxxx (with such agreement on acceptability not to be unreasonably
withheld).
3
c. Termination in General. Upon the termination of Xx. Xxxxx'x status as
Chairman, the Company shall pay to Xx. Xxxxx all of his Fees accrued as of the
date of termination and such expense reimbursements as are due as of such date.
d. Continuation of Health Benefits. To the extent that health insurance
benefits are provided under Section 5, if Xx. Xxxxx'x tenure as Chairman shall
terminate for reasons other than voluntary resignation by him not requested by
the Board, such benefits shall continue with the same coverage provided to Xx.
Xxxxx prior to the termination (e.g. medical, dental, optical, mental health)
and in all other respects significantly comparable to those in place immediately
prior to the termination at the Company's cost during the six-month period
following the date of termination.
7. Governing Law; Mediation & Arbitration. This Agreement shall be governed by,
and construed in accordance with the laws of the State of New York, without
regard to choice-of-law principles, as if made and to be performed solely in New
York.
8. Notices. All notices or other communications which are required or permitted
hereunder shall be in writing and sufficient if delivered personally or sent by
air courier or first class certified or registered mail, return receipt
requested and postage prepaid, addressed as follows:
If to Xx. Xxxxx, to: 0000 Xxx Xxxxxxx Xxxxx
Xxxxxx Xxxxx, XX 00000-0000
with a copy to: Xxxxxxxxx Xxxxxxx, P.A.
000 X. Xxxxxxx Xxxxx, Xxxxx 000-Xxxx Xxxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
Attn: Xxxxxx X. Xxxxx, Esq.
If to the Company, to: Xxxxx Industries Incorporated
0000 Xxxxxxx Xxxxxx
Xxx Xxxxx, Xxx Xxxx 00000
Attn: President
with a copy to: Xxxxx & Xxx Xxxxxx
0 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. XxXxxx, Esq.
or to such other address as the party to whom notice is to be given may have
furnished to the other party in writing in accordance herewith. All notices and
other communications given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been given on the date of delivery if
personally delivered; on the business day after the date when sent if sent by
air courier; and on the third business day after the date when sent if sent by
mail, in each case addressed to such party as provided in this Section or in
accordance with the latest written direction from such party.
4
9. Indemnification. The Company shall indemnify Xx. Xxxxx, as a director of the
Company, to the maximum extent permitted under applicable law against all
liabilities and expenses, including amounts paid in satisfaction of judgments,
in compromise, or as fines and penalties, and counsel fees, reasonably incurred
by Xx. Xxxxx in connection with the defense or disposition of any civil,
criminal, administrative or investigative action, suit or other proceeding,
whether civil or criminal, in which he may be involved or with which he may be
threatened, while an officer or director of the Company. Expenses (including
attorney's fees) incurred by Xx. Xxxxx in defending any such action, suit or
other proceeding shall be paid by the Company in advance of the final
disposition of such action, suit or proceeding upon receipt of an undertaking by
or on behalf of him to repay such amount if it shall be ultimately determined
that he is not entitled to be indemnified by the Company. The right of
indemnification provided herein shall not be exclusive of or affect any other
rights to which Xx. Xxxxx may be entitled. The provisions hereof shall survive
expiration or termination of this Agreement for any reason whatsoever. In the
event of any conflict between the provisions hereof and the indemnification
provisions contained in the Company's articles of incorporation or bylaws, or in
any agreement between the Company and Xx. Xxxxx, the terms of such articles,
bylaws or agreement shall govern.
10. Entire Agreement. This Agreement constitutes the sole agreement of the
parties and supersedes all oral negotiations and prior writings, including any
and all prior employment agreements between Xx. Xxxxx and the Company, with
respect to the subject matter hereof.
11. Advice of Counsel. EACH PARTY TO THIS AGREEMENT ACKNOWLEDGES THAT, IN
EXECUTING THIS AGREEMENT, SUCH PARTY HAS HAD THE OPPORTUNITY TO SEEK THE ADVICE
OF INDEPENDENT LEGAL COUNSEL, AND HAS READ AND UNDERSTOOD ALL OF THE TERMS AND
PROVISIONS OF THIS AGREEMENT. THIS AGREEMENT SHALL NOT BE CONSTRUED AGAINST ANY
PARTY BY REASON OF THE DRAFTING OR PREPARATION HEREOF.
12. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which shall constitute one
and the same instrument.
13. Amendments. No modification, waiver, amendment, discharge or change of this
Agreement shall be valid unless the same is in writing and signed by the Party
against which the enforcement of said modification, waiver, amendment, discharge
or change is sought.
14. Severability. If any portion of any provision of this Agreement, or the
application of such provision or any portion thereof to any person or
circumstance shall be held invalid or unenforceable, the remaining portions of
such provision or portion of such 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 to which it is held
invalid or unenforceable, shall not be effected thereby.
5
The Parties, by signing below, agree to the terms and conditions set forth
in this Agreement.
XXXXX INDUSTRIES INCORPORATED
By: /s/ Xxxxx X. Xxxxxxxxxx
------------------------------
President
Date: 3/30/2007
----------------------------
XXXXX. XXXXX
/s/ Xxxxx X. Xxxxx
----------------------------------
Xxxxx X. Xxxxx
Date: 3/30/2007
----------------------------
6
