Ex. 10.7
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "AGREEMENT") is dated as of the 25th day of
February 2002. It is made and entered into by and between Hand Brand
Distribution, Inc., a Florida corporation having offices located in Miami
Shores, Florida (hereinafter referred to as the "Company"), and Xxxxxxx Xxxxxxx,
a resident of the State of New York, USA (hereinafter referred to as
"Employee").
R E C I T A L S:
_ _ _ _ _ _ _ _
WHEREAS, Employee has specialized skills, experience and knowledge in
administration, sales and business development particularly with startup and
early stage companies,
WHEREAS, the Company is desirous of retaining Employee's services and Employee
is desirous of formalizing his relationship with the Company, and
WHEREAS, the Company is willing to enter into an employment agreement with the
Employee to provide services for the Company, but only upon the terms and
condition provided for hereinafter,
NOW, THEREFORE, IN CONSIDERATION of the mutual promises made herein and certain
additional valuable consideration, as provided for hereafter, it is AGREED, that
1. SERVICES. Subject to the provisions of this Section 1 and Sections 6, 7 and
8 hereof, Employee's title shall be President. The description of the
duties responsibilities and accountabilities shall be incorporated into the
Company's Bylaws, as the Company's shareholders shall adopt them from time
to time. The Company agrees to retain Employee to provide such services
under the terms and conditions set forth herein. Employee agrees to render
all services under this Agreement in a professional and business-like
manner and in full accordance with the terms and conditions of this
Agreement. During the term of this Agreement, Employee shall devote his
full time, energy, skill and best efforts to promote Employer's business
and affairs and to perform his duties hereunder.
2. COMPENSATION. The Company shall pay the Employee for his loyal and
consistent services as follows:
2.1. Employee shall be paid at the rate of $3,000.00 monthly.
2.2. Employee will receive options to purchase 50,000 shares of the
Company's common stock at $3.50 per share, exercisable commencing on
January 1, 2003, until February 24, 2007. The options shall vest on
December 31, 2002 and are subject to the terms and conditions of the
Stock Incentive Plan of the Company, which will be presented to the
Company's Board of Directors (the "Board") at its next meeting.
2.3. PAYMENTS. The Company shall pay Employee monthly in arrears. The
Company will reimburse Employee for Employee's actual, reasonable
expenses directly related to the performance of his services
hereunder, provided that Employee submits appropriate supporting
documentation and that each item of expense has been approved in
advance. Employee shall submit, not less frequently than monthly, a
report on the Company's standard expense report form detailing
Employee's reimbursable expenses together with supporting
documentation.
3. EMPLOYMENT STATUS. The Company and Employee agree that Employee is an
employee of the Company for every purpose. As an employee of the Company,
Employee shall be subject to all policies, rules and regulations
established by the Board. Employee shall also have the opportunity to
participate in all benefit programs established by the Company and approved
by the Board. The purpose of this agreement is to define the terms of the
employee's relationship with the Company.
4. CONTROL. The Board shall determine the means and manner of performance of
any services rendered pursuant to this Agreement. In conformity with the
status of the parties, Employee shall not hold himself out to have powers
and authority beyond the scope of those defined for the employee by the
Board. Employee shall have no right, power or authority to bind the Company
to any agreement, contract or other matter outside the scope of authority
established by the Board without the express and prior written consent of
the Board.
5. TERMINATION.
5.1. Either party may terminate this agreement by giving the other party thirty
(30) days prior written notice.
5.2. The Employer may terminate this Agreement immediately upon written
notice to the Employee. The term "Cause", as used herein, shall mean
the loss of any license necessary for the Employee to perform his
duties hereunder, or any willful misconduct, malfeasance, gross
negligence or other like conduct adversely affecting the best
interests of the Employer, including, without limitation, (i) the
failure or neglect by the Employee to perform his duties hereunder,
(ii) the violation or attempted violation of any provision hereof,
(iii) the commission of any felony, including, without limitation, any
fraud against the Employer, any of its affiliates, clients or
customers of the Employer.
6. CONFIDENTIALITY.
6.1. Employee acknowledges he will have access to operating, financial and
other information of Employer and customers of the Employer including,
without limitation, procedures, business strategies, and prospects and
opportunities, techniques, methods and information about, or received
by it, from its customers and that divulgence will irreparably harm
the Employer ("Confidential Information"). Employee also acknowledges
that the foregoing provides Employer with a competitive advantage (or
that could be used to the disadvantage of the Employer by a
competitor). Employee also acknowledges the interest of the Employer
in maintaining the confidentiality of such information and Employee
shall not, nor any person acting on behalf of Employee,
divulge, disclose or make known in any way or use for the individual
benefit of Employee or others any of such Confidential Information.
The foregoing is not applicable to such Confidential Information that
is established by Employee to be in the public domain otherwise than
as a result of its unauthorized disclosure by Employee or any other
person.
6.2. The customers of the Employer entrust the Employer with responsibility
for their business in the expectation that the Employer will hold all
such matters, including in some cases the fact that they are doing
business with the Employer and the specific transactions in which they
are engaged, in the strictest confidence ("Customer Confidences").
Employee covenants that after the termination of his employment with
the Employer, he will hold all Customer Confidences in a fiduciary
capacity and will not directly or indirectly disclose or use such
information.
6.3. Employee hereby assigns to the Employer his entire right, title and
interest in any idea, concept, technique, invention and related
documentation, other works of authorship, and the like (all
hereinafter called "Developments") made, conceived, written, or
otherwise created solely by him or jointly with others, whether or not
such Developments are patentable, subject to copyright protection or
susceptible to any other form of protection which relate to the actual
business or research or development of the Employer. Employee, after
the termination of its employment with Employer, shall return to the
Employer (and shall not retain any copies or excerpts therefrom) all
documents, notes, analyses or compilations, including all copies
thereof, and all other property relating to the Employer ("Employer
Documents") including, but not limited to, documents generated by
Employee pursuant to his relation with the Employer.
6.4. Employee acknowledges that the Employer has a compelling business
interest in preventing unfair competition stemming from the use or
disclosure of Customer Confidences and Confidential Information in the
event that, after any termination on the post-employment activities of
Employee, Employee goes to work or becomes affiliated with a
competitor of the Employer.
6.5. Employee further acknowledges that all customers he services or dealt
with while employed with the Employer are customers of the Employer
and not Employee's personally. Employee also acknowledges that, by
virtue of his employment with the Employer, Employee has gained or
will gain knowledge of the identity, characteristics and preferences
of the customers of the Employer, and that Employee will not use such
Customer Confidences and Confidential Information at any time.
7. COVENANTS NOT TO COMPETE OR SOLICIT.
7.1. The Employee undertakes that during the term of this Agreement and for
24 months thereafter, he will not, directly or indirectly (whether as
sole proprietor, partner, stockholder, director, officer, employee or
in any other capacity as principal or agent) compete with, or
participate in any business that competes with, the Employer; provided
that the Employee may invest in (i) the securities of any business or
enterprise (but
without otherwise participating in the activities of such business or
enterprise) which are listed on a national or regional securities
exchange or traded in the over-the-counter market, and (ii) equity
interests of the Employer, of any member thereof.
7.2. The Employee undertakes that during the term of this Agreement and for
a period of 36 months thereafter he will not, directly or indirectly
(whether as a sole proprietor, partner, stockholder, director,
officer, employee or in any other capacity as principal or agent), do
any of the following:
7.2.1. Hire, or attempt to hire for employment, any person who is an
employee of the Employer on the date of such termination of
employment, or attempt to influence any such person to
terminate his employment by the Employer; or
7.2.2. In any other manner interfere with, disrupt or attempt to
disrupt the relationship, contractual or otherwise, between
the Employer and any of its employees, or disparage the
business or reputation of the Employer to any such person.
7.2.3. The Employee undertakes that during the term of this Agreement
and for 24 months thereafter he will not, directly or
indirectly (whether as a sole proprietor, partner,
stockholder, director, officer, employee or in any other
capacity as principal or agent), do any of the following:
7.2.3.1. Solicit, service or accept any actual or prospective
accounts, clients or customers of the Employer during
the period of the Employee's employment by the
Employer;
7.2.3.2. Influence or attempt to influence any of the
accounts, customers or clients referred to in Section
7.2.3 to transfer their business or patronage from the
Employer to any other person or company engaged in a
similar business;
7.2.3.3. Directly assist any person or company soliciting,
servicing or accepting any of the accounts, customers
or clients referred to in Subsection 7.2.3; or
7.2.3.4. In any other manner directly interfere with, disrupt
or attempt to disrupt the relationship, contractual or
otherwise, between the Employer and any of its
accounts, customers or clients referred to in
Subsection 7.2.4, or any other person, or disparage the
business or reputation of the Employer to any such
person.
7.2.4. The Employer undertakes that during the term of this Agreement
and for a period of 60 months thereafter he will not, directly
or indirectly, disparage the business or reputation of the
Employee to any accounts, customers or clients referred to in
this Section 7, or any other person.
8. RETURN OF DOCUMENTS. On termination of the Employee's employment with the
Company, or at any time upon the request of the Board of Directors of the
Company or its affiliates, the
Employee shall return to the Employer all documents, including all copies
thereof, and all other property relating to the business or affairs of the
Employer, including, without limitation, customer lists, agents or
representatives lists, commission schedules and information manuals,
letters, materials, reports, lists and records (all such documents and
other property being hereinafter referred to collectively as the
"Materials"), in his possession or control, no matter from whom or in what
manner he may have acquired such property. The Employee acknowledges and
agrees that all of the Materials are property of the Employer and releases
all claims of right of ownership thereto.
9. ENFORCEMENT OF COVENANTS. The parties acknowledge and agree that the
covenants contained in Sections 6, 7 and 8 are essential elements of this
Agreement and that, but for the agreements of the Employee to comply with
such covenants, the Employer would not have entered into this Agreement.
The parties further acknowledge and agree that a breach by the Employee of
the covenants contained in Sections 6, 7 and 8 may result in irreparable
injury to the Employer for which there is no adequate remedy at law and
that the Employer shall be entitled to seek enforcement of the same by
means of a temporary restraining order and/or a preliminary or permanent
injunction issued by any court having jurisdiction thereof. In the event
that the Employee breaches any of the covenants contained in Sections 6, 7
and 8, the Employer shall be entitled to an accounting and repayment of all
profits, Commissions and benefits the Employee receives in connection with
such breach. The Employee agrees to indemnify and hold harmless the
Employer against all of its costs and expenses (including, without
limitation, reasonable attorneys fees and expenses) incurred in connection
with the enforcement of the covenants contained in Sections 6, 7 and 8,
except, with respect to the enforcement of any such covenant by the
Employer, to the extent that the Employer is the prevailing party in any
action or proceeding commenced by the Employer in connection therewith. The
covenants contained in Sections 6, 7 and 8 shall survive the termination of
this Agreement. The remedies provided in this Section 9 shall be in
addition to, and not in lieu of, any other remedies and relief including
damages to which the Employer may be entitled.
10. BLUE-PENCIL. If any court of competent jurisdiction shall at any time deem
the term of any of the covenants and undertakings of the Employee under
Sections 6, 7 and 8 herein too lengthy, the other provisions of those
Sections 6, 7 and 8 shall nevertheless stand, the period of restriction
shall be deemed to be the longest period permissible by law under the
circumstances. The court in each case shall reduce the period of
restriction to permissible duration.
11. MUTUAL INDEMNITIES. THE COMPANY AND EMPLOYEE JOINTLY AGREE TO AND SHALL
INDEMNIFY, DEFEND AND HOLD HARMLESS The OTHER FROM AND AGAINST ANY AND ALL
CLAIMS, LOSSES, DAMAGES, CAUSES OF ACTION, SUITS, AND LIABILITY OF EVERY
KIND, INCLUDING ALL EXPENSES OF LITIGATION, COURT COSTS, AND ATTORNEYS'
FEES, FOR INJURY TO OR DEATH OF ANY PERSON, OR FOR DAMAGE TO ANY PROPERTY,
ARISING OUT OF EITHER NEGLIGENCE OR MISCONDUCT IN CONNECTION WITH THE WORK
DONE BY EMPLOYEE UNDER THIS AGREEMENT; PROVIDED THAT THIS INDEMNIFICATION
SHALL NOT APPLY IN THE EVENT OF ANY GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT BY THE EMPLOYEE.
12. TERM. This Agreement shall expire, unless earlier terminated, on January
25, 2003. It will automatically renew monthly until either party gives
notice not less than thirty (30) days of termination.
13. ASSIGNMENT OF CONTRACT. The Employee may not assign his rights under this
Agreement without the written consent of the Company.
14. GOVERNING LAW. This Agreement, and the rights and obligations of the
parties hereto, shall be governed by and construed in accordance with the
laws of the State of New York without regard to principles of conflict of
laws. Any disputes with respect to the interpretation of this Agreement or
the rights and obligations of the parties hereto shall be exclusively
brought in any federal or state court of competent jurisdiction located in
the City of New York, State of New York. Each of the parties waives any
right to object to the jurisdiction or venue of such courts or to claim
that such courts are an inconvenient forum.
15. ENTIRE AGREEMENT AMENDMENT. This Agreement constitutes the entire
Agreement, representation and understanding of the parties hereto with
respect to the subject matter hereof, and no amendment or modification
shall be valid or binding unless made in writing and signed by the parties
to this Agreement. This Agreement supersedes any and all other agreements,
either oral or written, between the Company and Employee with respect to
the subject matter hereof, and contains all of the covenants and agreements
between the parties relating in any way to Employee's services for the
Company.
16. NOTICES. All notices or other communications required or permitted
hereunder shall be in writing. All notices or other required or permitted
communications shall be delivered or sent, as the case may be, by any of
the following methods: (i) personal delivery; (ii) overnight commercial
carrier; or (iii) registered or certified mail, postage prepaid, return
receipt requested. Receipt and effective delivery shall occur upon the
earlier of the following: (a) If personally delivered, the date of delivery
to the address of the person to receive such notice; (b) If delivered by
overnight commercial carrier, one day following the receipt of such
communication by such carrier from the sender as shown on the sender's
delivery invoice from such carrier; or (c) If mailed, two (2) business days
after the date of posting by the United States post office. No notice or
other required or permitted communication shall be effective unless and
until received.
Any such notice or other communication so delivered shall be addressed to
the party to be served at the address set forth below:
THE COMPANY EMPLOYEE
Hand Brand Distribution, Inc. Xxxxxxx Xxxxxxx
0000 X.X. 0xx Xxxxxx 000 Xxxxxxxx, xxxxx 0000
Xxxxx Xxxxxx, Xxxxxxx 00000 Xxx Xxxx, Xxx Xxxx 00000
Notice of change of address shall be given by written notice in the manner
detailed in this
Section. Rejection or other refusal to accept, or the inability to deliver
because of changed address for which no notice was given, shall be deemed
to constitute receipt of the notice or communication sent.
17. MODIFICATION AND WAIVER. No change or modification of this Agreement shall
be valid or binding upon the parties hereto unless such change or
modification shall be in writing and signed by the Company and Employee. No
course of dealing between the Company and Employee, nor any waiver by the
Company of a breach of any provision of this Agreement, or delay in
exercising any right under this Agreement, shall operate or be construed as
a waiver of any subsequent breach by Employee.
18. REMEDIES FOR BREACH. Employee recognizes and acknowledges that the remedy
at law for a breach by Employee of any of the covenants contained in this
Agreement shall be inadequate. Employee agrees that the Company, in
addition to all other legal and equitable remedies it may have, shall have
the right to injunctive relief to enforce the provisions of this Agreement
if there is such a breach or threatened breach. The Company hereby
expressly reserves the right to offset any costs it incurs as a result of
any breach of this Agreement by Employee against any amounts payable to
Employee hereunder and the right to terminate this Agreement upon written
notice for a breach of this Agreement by Employee. Both parties shall have
all other rights and remedies available at law or in equity for a breach or
threatened breach of this Agreement. Employee agrees that all sums payable
to it under this Agreement shall be available to the Company to satisfy
Employee's breach of this Agreement and to satisfy Employee's indemnity
agreement set forth herein. If any action at law or in equity is necessary
to enforce or interpret the terms of this Agreement, the prevailing party
shall be entitled to recover its reasonable costs and attorneys' fees from
the other party.
19. REMOVAL OF ILLEGAL, INVALID OR UNENFORCEABLE PROVISIONS. If any provision
of this Agreement is held to be illegal, invalid or unenforceable, such
provision may be removed. Thereafter, the Agreement shall be considered to
be legal, valid or enforceable provision as though the removed provision
had never comprised a part of the Agreement. The remaining provisions of
this Agreement shall remain in full force and effect and shall not be
affected by the illegal, invalid or unenforceable provision or by their
removal from this Agreement.
20. NO PARTNERSHIP OR JOINT VENTURE. Nothing in this Agreement is either
intended and should not in any way be construed to create any form of joint
venture, partnership or agency relationship of any kind between the Company
and Employee. The parties expressly disclaim any intention of any kind to
create any such relationship between themselves.
21. TRAVEL POLICY. All travel arrangements must be consistent with the policies
and practices adopted by the Board.
IN WITNESS WHEREOF, the parties have executed this Agreement or caused this
Agreement to be executed on the date first set forth above.
Hand Brand Distribution Inc. ("The Company")
By: /S/ Date:
_______________________________
Title:
Xxxxxxx Xxxxxxx ("EMPLOYEE"):
/S/ Date:
___________________________________
