EXHIBIT 10.3
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EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT entered into as of this 24th day of May 1999,
between The Publishing Company of North America, Inc. (the "Company") and Xxxxx
X. Xxxxxx (the "Executive").
WHEREAS, the Company desires to employ Executive and to ensure the
continued availability to the Company of the Executive's services, and the
Executive is willing to accept such employment and render such services, all
upon and subject to the terms and conditions contained in this Agreement and
WHEREAS, the Company has provided and/or will provide specialized
training in its business to the Executive;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants set forth in this Agreement, and intending to be legally bound, the
Company and the Executive agree as follows:
1. Term of Employment.
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(a) Term. The Company hereby employs the Executive, and the
Executive hereby accepts employment with the Company, for a period
commencing May 24, 1999 and ending three years thereafter.
(b) Continuing Effect. Notwithstanding any termination of this
Agreement except for termination under Section 5(c), at the end of the
Term or otherwise, the provisions of Sections 6 and 7 shall remain in
full force and effect and the provisions of Section 7 shall be binding
upon the legal representatives, successors and assigns of the
Executive.
2. Duties.
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(a) General Duties. The Executive shall serve as president and
chief executive officer of the Company, with duties and
responsibilities that are consistent with the Executive's duties and
responsibilities as of the date of this Agreement. The Executive will
also perform services for such subsidiaries as may be necessary. The
Executive will use his best efforts to perform his duties and discharge
his responsibilities pursuant to this Agreement competently, carefully
and faithfully. In determining whether or not the Executive has used
his best efforts hereunder, the Executive's and the Company's
delegation of authority and all surrounding circumstances shall be
taken into account and the best efforts of the Executive shall not be
judged solely on the Company's earnings or other results of the
Executive's performance.
(b) Devotion of Time. The Executive shall devote all of his
time, attention and energies during normal business hours (exclusive of
periods of sickness and disability and of such normal holiday and
vacation periods as have been established by the Company) to the
affairs of the Company.
3. Compensation and Expenses.
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(a) Salary. For the services of the Executive to be rendered
under this Agreement, the Company shall pay the Executive a salary as
follows: (1) For the first year of this Agreement, the Executive shall
receive $2,500 per week; (2) For the second year of this Agreement, the
Executive shall receive $3,000 per week; (3) For the third year of this
Agreement, the Executive shall receive $3,500 weekly.
(b) Expenses. In addition to any compensation received
pursuant to Section 3(a) and (c), the Company will reimburse or advance
funds to the Executive for all reasonable travel, entertainment and
miscellaneous expenses incurred in connection with the performance of
his duties under this Agreement.
(c) Management Bonus. The Executive shall receive an annual
bonus equal to 5% of the Company's increase in incremental (measured
from the previous year) year-end pre-tax net income. Bonus calculation
for fiscal 1999 shall use as a basis, zero dollars profit for fiscal
year 1998, whereas the Executive shall not be paid a bonus on the
difference between zero dollars profit and the Company's $885,337.00
1998 year-end loss.
4. Benefits.
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(a) Vacation. For each 12-month period during the Term, the
Executive will be entitled to four weeks of vacation without loss of
compensation or other benefits to which he is entitled under this
Agreement, to be taken at such times as the Executive may select and
the affairs of the Company may permit. Any unused vacation will be paid
for by the Company in addition to regular salary at the annual rate in
effect during 12 month period.
(b) Options. Upon execution of this Agreement, the Executive
shall be granted 150,000 non-qualified options to purchase the
Company's common stock, exercisable at Two Dollars each ($2.00) and
vesting over a three year period, with one third vesting each December
31st for the duration of this Agreement, and expiring ten years after.
(c) Employee Benefit Programs. The Executive is entitled to
participate in any pension, 401(k), insurance or other employee benefit
plan that is maintained by the Company for its executive officers,
including programs of life and medical insurance and reimbursement of
membership fees in civic, social and professional organizations.
(d) Insurance. The Company shall provide to Executive and pay
premiums on the Company's medical insurance policy and any other
medical, dental or insurance programs offered through the company,
covering Executive and Executive's dependents.
(e) Car Allowance. The Executive is entitled to the use of a
Company automobile currently consisting of the 1996 Chevrolet Tahoe
used by him which may be replaced by the Executive once during the term
of this agreement with a new comparable automobile at his discretion.
All expenses associated with the use of such automobile including
insurance, gas, oil and repairs shall be paid by the Company.
5. Termination.
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(a) Termination for Cause. The Company may terminate the
Executive's employment pursuant to the terms of this Agreement at any
time for cause by giving written notice of termination. Such
termination will become effective upon the giving of such notice. Upon
any such termination for cause, the Executive shall have no right to
compensation, bonus or reimbursement under Section 3, or to participate
in any employee benefit programs under Section 4, except as provided by
law, for any period subsequent to the effective date of termination.
For purposes of this Section 5(a), "cause" shall mean: (i) the
Executive is convicted of a felony which is directly related to the
Executive's employment or the business of the Company; (ii) the
Executive, in carrying out his duties hereunder, has been found in a
civil action to have committed gross negligence or intentional
misconduct resulting in either case in direct material harm to the
Company; (iii) the Executive is found in a civil action to have
breached his fiduciary duty to the Company resulting in direct profit
to him; or (iv) the Executive is found in a civil action to have
materially breached any provision of Section 6 or Section 7. The term
"found in a civil action" shall not apply until all appeals permissible
under the applicable rules of procedure or statute have been determined
and no further appeals are permissible.
(b) Death or Disability. Except as otherwise provided in this
Agreement, it shall terminate upon the death or disability of the
Executive. For purposes of this Section 5(b), "disability" shall mean
that for a period of 12 consecutive months in any 12-month period the
Executive is incapable of substantially fulfilling the duties set forth
in Section 2 because of physical, mental or emotional incapacity
resulting from injury, sickness or disease. In the event of Executive's
disability, the Executive will be paid compensation, benefits and bonus
which may accrue during the period of disability up to a total of 18
months, or for the remainder of this Agreement, whichever time is
greater.
(c) Special Termination. In the event that (i) the Executive,
with or without change in title or formal corporate action, shall no
longer exercise all of the duties and responsibilities and shall no
longer possess substantially all the authority set forth in Section 2;
or (ii) the Company materially breaches this Agreement or the
performance of its duties and obligations hereunder; or (iii) any
entity or person not now an executive officer of the Company becomes
either individually or as part of a group the beneficial owner of 25%
or more of the Company's common stock, in any such event the Executive,
by written notice to the Company, may elect to deem the Executive's
employment hereunder to have been terminated by the Company without
cause, in which event the Executive shall be entitled to the
compensation, reimbursement and benefits payable pursuant to Sections 3
and 4 herein for the remaining term of this Agreement and all of
Executive's remaining unvested options shall vest immediately upon such
termination. In such event, the Executive, by written notice to the
Company, may elect to refuse all further obligations of the Company
under Sections 3 and 4 and to release the Company with respect thereto,
in which event the Company shall release the Executive from the
provisions of Section 6.
(d) Continuing Effect. Notwithstanding any termination of the
Executive's employment as provided in this Section 5 or otherwise, the
provisions of Section 6 shall remain in full force and effect, except
as otherwise provided in Section 5(c).
6. Non-competition Agreement.
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(a) Competition with the Company. Until termination of his
employment and for a period of 12 months commencing on the date of
termination, the Executive, directly or indirectly, in association with
or as a shareholder, director, officer, consultant, employee, partner,
joint venturer, member or otherwise of or through any person, firm,
corporation, partnership, association or other entity, will not compete
with the Company or any of its affiliates in the offer, sale or
marketing of products or services that are competitive with any of the
products or services offered by the Company, within any metropolitan
area in the United States or elsewhere in which the Company is then
engaged in the offer and sale of competitive products or services;
provided, however, the foregoing shall not prevent Executive from
accepting employment with an enterprise engaged in two or more lines of
business, one of which is the same or similar to a portion of the
Company's business (the "Prohibited Business") if Executive's
employment is totally unrelated to the Prohibited Business; provided,
further, the foregoing shall not prohibit Executive from owning up to
5% of the securities of any publicly-traded enterprise provided
Executive is not an employee, director, officer, consultant to such
enterprise or otherwise reimbursed for services rendered to such
enterprise.
(b) Solicitation of Customers. During the periods in which the
provisions of Section 6(a) shall be in effect, the Executive, will not
seek Prohibited Business from any Customer (as defined below) on behalf
of any enterprise or business that is in direct competition with the
Company's bar association print directory programs, refer Prohibited
Business from any Customer to any enterprise or business that is in
direct competition with the Company's bar association print directory
programs or receive commissions based on sales or otherwise relating to
the Prohibited Business from any Customer, or any enterprise that is in
direct
competition with the Company's bar association print directory
programs. For purposes of this Section 6(b), the term "Customer" means
any person, firm, corporation, partnership, association or other entity
to which the Company or any of its affiliates sold or provided goods or
services during the 6-month period prior to the time at which any
determination is required to be made as to whether any such person,
firm, corporation, partnership, association or other entity is a
Customer.
(c) No Payment. The Executive acknowledges and agrees that no
separate or additional payment will be required to be made to him in
consideration of his undertakings in this Section 6.
7. Nondisclosure of Confidential Information. The Executive
acknowledges that during his employment he will learn and will have
access to confidential information regarding the Company and its
affiliates, including without limitation (i) confidential or secret
plans, programs, documents, agreements or other material relating to
the business, services or activities of the Company and its affiliates
and (ii) trade secrets, market reports, customer investigations,
customer lists and other similar information that is proprietary
information of the Company or its affiliates (collectively referred to
as "Confidential Information"). The Executive acknowledges that such
Confidential Information as is acquired and used by the Company or its
affiliates is a special, valuable and unique asset. All records, files,
materials and Confidential Information obtained by the Executive in the
course of his employment with the Company are confidential and
proprietary and shall remain the exclusive property of the Company or
its affiliates, as the case may be. The Executive will not, except in
connection with and as required by his performance of his duties under
this Agreement, for any reason use for his own benefit or the benefit
of any person or entity with which he may be associated or disclose any
such Confidential Information to any person, firm, corporation,
association or other entity for any reason or purpose whatsoever
without the prior written consent of the Board unless such Confidential
Information previously shall have become public knowledge through no
action by or omission of the Executive.
8. Equitable Relief.
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(a) The Company and the Executive recognize that the services
to be rendered under this Agreement by the Executive are special,
unique and of extraordinary character, and that in the event of the
breach by the Executive of the terms and conditions of this Agreement
or if the Executive, without the prior consent of the Board shall leave
his employment for any reason and take any action in violation of
Section 6 or Section 7, the Company will be entitled to institute and
prosecute proceedings in any court of competent jurisdiction referred
to in Section 8(b) below, to enjoin the Executive from breaching the
provisions of Section 6 or Section 7. In such action, the Company will
not be required to plead or prove irreparable harm or lack of an
adequate remedy at law. Nothing contained in this Section 8 shall be
construed to prevent the Company from seeking such other remedy in
arbitration in case of any breach of this Agreement by the Executive,
as the Company may elect.
(b) Any proceeding or action must be commenced in Volusia
County, Florida where the Company maintains its principal offices. The
Executive and the Company irrevocably and unconditionally submit to the
exclusive jurisdiction of such courts and agree to take any and all
future action necessary to submit to the jurisdiction of such courts.
The Executive and the Company irrevocably waive any objection that they
now have or hereafter irrevocably waive any objection that they now
have or hereafter may have to the laying of venue of any suit, action
or proceeding brought in any such court and further irrevocably waive
any claim that any such suit, action or proceeding brought in any such
court has been brought in an inconvenient forum. Final judgment against
the Executive or the Company in any such suit shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment, a
certified or true copy of
which shall be conclusive evidence of the fact and the amount of any
liability of the Executive or the Company therein described, or by
appropriate proceedings under any applicable law or otherwise.
9. Assignability. The rights and obligations of the Company under this
Agreement shall inure to the benefit of and be binding upon the
successors and assigns of the Company, provided that such successor or
assign shall acquire all or substantially all of the securities or
assets of the Company. The Executive's obligations hereunder may not be
assigned or alienated and any attempt to do so by the Executive will be
void.
10. Severability.
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(a) The Executive expressly agrees that the character,
duration and geographical scope of the provisions set forth in this
Agreement are reasonable in light of the circumstances as they exist on
the date hereof. Should a decision, however, be made at a later date by
a court of competent jurisdiction that the character, duration or
geographical scope of such provisions is unreasonable, then it is the
intention and the agreement of the Executive and the Company that this
Agreement shall be construed by the court in such a manner as to impose
only those restrictions on the Executive's conduct that are reasonable
in the light of the circumstances and as are necessary to assure to the
Company the benefits of this Agreement. If, in any judicial proceeding,
a court shall refuse to enforce all of the separate covenants deemed
included herein because taken together they are more extensive than
necessary to assure to the Company the intended benefits of this
Agreement, it is expressly understood and agreed by the parties hereto
that the provisions of this Agreement that, if eliminated, would permit
the remaining separate provisions to be enforced in such proceeding
shall be deemed eliminated, for the purposes of such proceeding, from
this Agreement.
(b) If any provision of this Agreement otherwise is deemed to
be invalid or unenforceable or is prohibited by the laws of the state
or jurisdiction where it is to be performed, this Agreement shall be
considered divisible as to such provision and such provision shall be
inoperative in such state or jurisdiction and shall not be part of the
consideration moving from either of the parties to the other. The
remaining provisions of this Agreement shall be valid and binding and
of like effect as though such provision were not included.
11. Notices and Addresses. All notices, offers, acceptance and any
other acts under this Agreement (except payment) shall be in writing,
and shall be sufficiently given if delivered to the addressees in
person, by Federal Express or similar receipted delivery, by facsimile
delivery or, if mailed, postage prepaid, by certified mail, return
receipt requested, as follows:
To the Company: The Publishing Company of
North America, Inc.
000 XXXX Xxxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
With a Copy to: Xxxxxxx X. Xxxxxx, Esq.
Xxxxxxx Xxxxxx, P.A.
1645 Palm Beach Lakes Blvd., Ste. 000
Xxxx Xxxx Xxxxx, XX 00000
To the Executive: Xx. Xxxxx X. Xxxxxx
0000 Xxxxx Xxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
or to such other address as either of them, by notice to the other may
designate from time to time. The transmission confirmation receipt from
the sender's facsimile machine shall be conclusive evidence of
successful facsimile delivery. Time shall be counted to, or from, as
the case may be, the delivery in person or by mailing.
12. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of
which together shall constitute one and the same instrument. The
execution of this Agreement may be by actual or facsimile signature.
13. Attorney's Fees. In the event that there is any controversy or
claim arising out of or relating to this Agreement, or to the
interpretation, breach or enforcement thereof, and any action or
proceeding is commenced to enforce the provisions of this Agreement,
the prevailing party shall be entitled to a reasonable attorney's fee,
costs and expenses.
14. Governing Law. This Agreement and any dispute, disagreement, or
issue of construction or interpretation arising hereunder whether
relating to its execution, its validity, the obligations provided
therein or performance shall be governed or interpreted according to
the internal laws of the State of Florida without regard to choice of
law considerations.
15. Entire Agreement. This Agreement constitutes the entire Agreement
between the parties and supersedes all prior oral and written
agreements between the parties hereto with respect to the subject
matter hereof. Neither this Agreement nor any provision hereof may be
changed, waived, discharged or terminated orally, except by a statement
in writing signed by the party or parties against which enforcement or
the change, waiver discharge or termination is sought.
16. Section and Paragraph Headings. The section and paragraph headings
in this Agreement are for reference purposes only and shall not affect
the meaning or interpretation of this Agreement.
IN WITNESS WHEREOF, the Company and the Executive have executed this
Agreement as of the date and year first above written.
THE PUBLISHING COMPANY OF
NORTH AMERICA, INC.
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------------------ By:
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Xxxxxxx Xxxxxxx, Chief
Operating Officer
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------------------ By:
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Xxxxx X. Xxxxxx
