Exhibit 10.13
EMPLOYMENT AGREEMENT
THIS AGREEMENT (the "Agreement") effective as of January 11,
1999, between XXXXXXXX GROUP, INC., a Delaware Corporation, (the "Employer")
with offices at 000 Xxxxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx, 00000 and
XXXXX X. XXXXXX (the "Executive"), an individual residing at 000 Xxxx 00xx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
The Employer seeks to employ the Executive and the Executive has agreed
to enter into this Agreement.
Now Therefore, the parties in consideration of the mutual promises
herein contained hereby agree as follows:
1. Term of Services. The Executive's "term of employment," as this phrase is
used throughout this Agreement, shall be for the two (2) year period beginning
January 11, 1999 and ending January 12, 2001 subject, however, to earlier
termination for either "Cause" (as defined below) or not for "Cause" as
expressly provided herein.
2. Employment. The Employer shall employ the Executive, and the Executive shall
serve, as Vice President and Chief Financial Officer of the Employer during the
term of employment.
Subject to his election as such and without additional compensation, if
requested, the Executive agrees to serve during the term of employment in such
particular additional offices of comparable stature and responsibility
consistent with his performance as Vice President and Vice President and Chief
Financial Officer of the Employer to which he maybe elected from time to time in
the Employer and its subsidiaries. During the term of employment, except during
the transition period from January 11, 1999 through March 31, 1999, (the
"Transition Period") during which the Executive shall be permitted to wind up
the matters for which he has been responsible prior to term of employment, (i)
the Executive's services shall be rendered on a substantially full time,
exclusive basis, (ii) he will apply on a substantially full time basis all of
his skill and experience to the performance of his duties in such employment,
(iii) he shall have no other employment and, without the consent of a majority
of the members of the Employer's Board of Directors (the "Board"), no outside
business activities that require the devotion of substantial amounts of the
Executive's time, and (iv) unless otherwise specified by the Board, the
Executive, the headquarters for the performance of his services shall be the
principal executive offices of the Employer in the greater New York metropolitan
area (currently located 000 Xxxxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx
10022), subject to such reasonable travel as the performance of his duties in
the business of the Employer may require.
Except during the Transition Period, during the term of employment, the
Executive shall not, directly or indirectly, render any services to any other
person, or acquire any interests of any type in any other person, that might be
deemed in competition with the Employer or any of its subsidiaries or affiliates
or in conflict with his position as Vice President and Chief Financial Officer
of the Employer; provided, however, that the foregoing shall not be deemed to
prohibit the Executive from (i) acquiring, solely as an investment and through
market purchases, securities of any corporation that are registered under
Section l2(b) or l2(g) of the Securities Exchange Act of 1934 and that are
publicly traded so long as he is not part of any control group of such
corporation(s) or companies, (ii) acquiring, solely as an investment, any
securities of a partnership, trust, corporation (other than a corporation that
has outstanding securities covered by the preceding clause (i)) or other entity
so long as such entity is not, directly or indirectly, in competition with the
Employer or any of its subsidiaries or affiliates or (iii) serving as a director
of any corporation that is not in competition with the Employer or any of its
subsidiaries or affiliates.
3. Compensation. The Compensation of the Executive shall be comprised of the
following components: Base Salary; Incentive Compensation (Bonus); Incentive
Stock Options; Other Fringe Benefits; Severance; the Stock Loan/Purchase
Program; and the Non-Qualified Stock Options.
3.1 Base Salary. The Employer shall pay or cause to be paid to the
Executive during the term of employment a base salary of not less than the
annual rate of $150,000 (the "Base Salary"), payable in accordance with current
practices of the Employer, as such practices may exist from time to time, it
being understood and acknowledged by the Executive that currently the payment
practices of the Employer call for such payments to be made monthly in arrears.
Due to the short term of the Executive's employment as of February 28,
1999, the Executive will not receive a full compensation review at that time.
Instead, effective as of March 1, 1999, the Executive shall receive an increase
in his Base Salary equal to the "standard increase" (an amount equal to
approximately 4% per annum) applied to the eligible payroll of the Employer.
As of March 1, 2000, the Executive's Base Salary will be subject to a
full review by the Employer and the Employer, by action of the Compensation
Committee of the Employer's Board of Directors (the "Compensation Committee")
taken in its discretion, may increase, but not decrease, the Base Salary at any
time and from time to time during the term of employment.
3.2 Incentive Bonus Compensation ("Bonus") For Fiscal Year Ended
February 28, 1999. In addition to the Base Salary, the Executive shall be
entitled to receive an annual bonus for the approximate two (2) month period
from January 11, 1999 through the end of the Employer's fiscal year ended
February 28, 1999 in the amount of $10,000.
3.3 Incentive Bonus Compensation For Fiscal Years Ended February 29,
2000 and Thereafter. In addition to the Base Salary, the Executive shall be
eligible to receive an annual bonus (the "Annual Bonus") for the twelve (12)
month period, after March 1, 1999 in an amount equal to the annual rate of
fifteen percent (15%) of the Base Salary in effect as of February 29, 2000. The
awarding of the Annual Bonus shall be based upon the Executive achieving, as
determined in the sole discretion of the Compensation Committee, the Management
By Objective ("Management by Objectives" or "MBO") goals (the "MBO Goals") that
have been established for the Executive for the fiscal year by mutual agreement
between the Executive and the Employer.
Although all of the MBO Goals for the Executive for the fiscal year
ended February 29, 2000 have not been established, the Executive and the
Employer agree that one of the Executive's MBO Goals for such time period shall
be that The X. X. Xxx Company ("Ney"), a wholly-owned subsidiary of the
Employer, in a manner acceptable to the Board, shall either: (a) have completed
an acquisition of a business that has annual revenues of in excess of $15
million, or (b) have completed an initial public offering of the stock of Ney.
3.4 Incentive Stock Option. In addition to the Base Salary the Employer
has an incentive stock option plan ("ISO Plan") currently in existence and the
Executive shall be awarded 10,000 shares pursuant to the terms and subject to
the conditions of the ISO Plan, as it exists from time to time, at the mean of
the Bid and Asked prices of the Employer Common Stock in effect as of the
Executive's first day of work, currently scheduled to occur on January 11, 1999.
3.5 Executives Other Fringe Benefits. In addition to the Base Salary
the Employer shall receive such other fringe benefits ("Other Fringe Benefits")
as the Employer may have in effect from time to time, including the following
fringe benefits that are currently in effect for employees of the Employer: life
insurance, disability insurance, medical insurance and vacations in accordance
with the Employer's standard policies relating thereto, which policies, as of
the date hereof, currently provide for the following benefits (it being
acknowledge by the Executive that certain of these fringe benefits will require
contributions from the Executive):
A. Life Insurance. $250,000 of term life insurance over and above the
$50,000 of term life insurance provided by the Employer's standard benefit plan.
B. Disability Insurance. Disability insurance pursuant to such plan of
disability insurance that the Employer may have in effect from time to time for
employees of comparable status to the Executive.
C. Medical Insurance. The CIGNA Plan Major Medical (Approximately 75% of
the premiums for this insurance are currently paid for the employees by the
Employer.)
D. Vacation. The Standard Vacation Policy of the Employer (and the
exceptions, where applicable, for the Executive) is as follows:
o Two Weeks Annual Vacation: during the first five (5) years of employment.
(In addition, the Executive shall receive one additional week during the initial
five (5) years of employment.)
o Three Weeks Annual Vacation: during the next four (4) years of employment
(employment years six through nine).
o Four Weeks Annual Vacation: during the tenth year of employment and
thereafter
3.6 Severance.
A. No Severance If Termination Is For "Cause" By the Employer Or If
Termination Is By Executive's Own Volition. In the event of (i) termination of
the employment of the Executive by the Employer for "Cause" (as defined below)
or (ii) termination of the employment of the Executive by the Executive by his
own volition, there will be no severance ("Severance") payments and the Base
Salary shall be paid to the Executive to the date of termination and the
Executive shall not be entitled to receive any other form of compensation from
the Employer whether pursuant to this Agreement or otherwise; provided however,
with respect to the Stock Loan/Purchase Program (described and defined below),
the rights and obligations of the parties pursuant to the various documents
(including the provisions in this Agreement) that relate to such program as
otherwise set forth herein (or in the other documents relating thereto) shall
continue to be in full force and effect pursuant to their respective terms and
subject to their respective conditions notwithstanding such termination.
X. Xxxxxxxxx Paid If Termination of Executive Is Not For
"Cause" The Executive acknowledges and agrees that
the Employer has and retains the right to terminate
the Executive's employment not for "Cause." In the
event of the termination of the employment of the
Executive by the Employer not for "Cause," the
following provisions shall apply:
x. Xxxxxxxxx Paid If Termination Occurs
During the First Contract Year of
Employment. In the event that Executive is
terminated by the Employer not for "Cause"
during the First Contract Year, then in that
event, the Employer shall pay Executive a
sum equal to:
(A) 90 days of Base Salary (which
amount shall be payable to the
Executive in any event regardless of
the amount, if any, of the Pay
Differential, plus
(B) the "Pay Differential," if any,
(as defined and described below).
"Pay Differential" (whether for the First
Contract Year or the Second Contract Year)
shall mean and refer to the amount, if any,
by which the amount of the Base Salary (in
accord with paragraph (a) below) is greater
than the amount of Other Reportable Income
(in accord with paragraph (b) below):
(a) Base Salary: the annual rate of
the Executive's Base Salary for the
contract year in question either (i)
the first contract year (the "First
Contract Year") from January 11,
1999 through January 10, 2000 or the
second contract year (the "Second
Contract Year") from January 11,
2000 to January 10, 2001 (the First
Contract Year and the Second
Contract Year are collectively
referred to as "Contract Year(s)"
where applicable; and
(b) Other Reportable Income: the
Executive's "reportable income" (as
defined by the Internal Revenue
Code) from all sources for the
Contract Year in question whether
such "reportable income" has been
paid in cash or is accrued
(including but not limited to income
received by the Executive pursuant
to this Agreement) (such income is
referred to herein as "Other
Reportable Income").
In the event that Other Reportable Income
exceeds the Base Salary for the Contract
Year in question, then in that event, there
is no Pay Differential and the Executive
would only receive 90 days Base Salary as
his Severance payment.
ii. Severance Paid If Termination Occurs
During the Second Contract Year of
Employment. In the event that Executive is
terminated by the Employer not for "Cause"
during the Second Contract Year, then in
that event, the Employer shall pay the
Executive a sum equal to:
(A) 90 days of Base Salary (which
amount shall be payable to the
Executive in any event regardless of
the amount, if any, of the Pay
Differential, plus
(B) the "Pay Differential," if any,
(as defined and described above).
provided however, the payment of the Pay
Differential portion of the Severance (but
not the 90 days Base Salary portion of the
Severance) shall be conditioned upon
Executive's obligation to mitigate damages
by the Executive conducting a diligent
search for employment after such termination
and the payment of such amount shall be paid
upon the conclusion of the Contract Year in
question.
Timing of Severance Payments: Regardless of whether the Severance is being
paid in connection with the First Contract Year or the Second Contract Year,
(a) The 90 days of Base Pay portion
of the Severance shall be paid to
the Executive upon the termination
date of the Executive.
(b) The Pay Differential portion of
the Severance, if any, shall be paid
after the close of the Contract Year
in question and then within 30 days
after the Executive supplies the
Employer with such information and
documentation as are reasonably
required by the Employer in order to
be able to determine the amount, if
any, of the Other Reportable Income
of the Executive for the Contract
Year in question.
Payments of Other Compensation Components In
the Event of Termination Not For Cause: In
the event of termination not for Cause, in
addition to the Severance described above,
the following shall apply:
(a) The Executive shall receive his
Incentive Bonus Compensation which
shall be determined on the basis
that (i) all of the MBO Goals have
been achieved but (ii) such amount
shall be prorated to reflect only
that portion of the year during
which the Executive was employed by
the Employer.
(b) The Incentive Stock Option Plan
only applies to employees and once
the Executive ceases to be an
employee of the Employer such plans
cease to be in effect.
(c) The Non-Qualified Stock Option
Plan shall terminate to the extent
the vesting requirements have not
been met at the time of termination.
Executives shall have thirty (30)
days from the date of termination to
exercise the non-qualified stock
options which have been vested.
3.7 Stock Loan/Purchase Program: In order to effectuate this Agreement,
the Employer agrees, on a best efforts basis, to locate a block of 62,500 shares
of Common Stock of Employer ("Employer Common Stock") that is available for sale
by existing shareholder(s) of the Employer at a price of approximately $4.00 per
share. The Executive agrees with his own funds to purchase 12,500 shares of such
shares at a price of approximately $4.00 per share purchase price. In addition,
the Employer agrees to lend (the "Executive Loan") the Executive $200,000 for
the sole and only purpose of the purchase by the Executive of the remaining
50,000 shares of Employer Common Stock from such third party pursuant to the
following terms and conditions:
A. Principal Maturity Date: All of the $200,000 of the principal amount of
the Executive Loan shall be due and payable Two years from date of making of
such $200,000 Executive Loan;
B. Interest Rate: Seven percent (7%) per annum;
C. Payment of Interest: The interest of seven percent (7%) per
annum shall be paid quarterly in arrears on the unpaid
principal balance at the end of the third, sixth, ninth,
twelfth, fifteenth, eighteenth, twenty-first and twenty-fourth
months after the date of the Note.
D. Evidence of Obligation: The Executive shall execute and
deliver a promissory note (the "Executive Note") payable to
the Employer evidencing all of the terms and conditions of the
$200,000 loan being made to the Executive by the Employer.
E. Security: The Executive shall pledge (the "Executive Pledge")
all the 62,500 shares of Employer Common Stock (including the
12,500 shares of such stock acquired by use of the Executive's
own funds) in order to secure the payment of the Executive
Note pursuant to the terms and subject to the conditions of a
standard stock pledge agreement and such Executive Pledge
shall be perfected so that the Employer obtains a first
priority security interest in the such 62,500 shares pursuant
to the New York Uniform Commercial Code;
F. Executive Put: Subject to compliance with applicable federal
securities laws and any other applicable laws, the Executive
shall be able, on a dollar for dollar basis, to put (the
"Executive Put") the shares of Employer Common Stock to the
Employer in payment of the Executive Note at any time on or
prior to the maturity date of the Executive Note pursuant to
the following terms and conditions:
(i) Executive Has Unlimited Upside Potential Gain:
The Executive shall be entitled to receive and retain
all of the benefit of any appreciation that may occur
with respect to the 62,500 shares of Employer Common
Stock being acquired pursuant to the Stock
Loan/Purchase Program and if the Employer Common
doubles in value from, for example, $4.00 per share
to $8.00 per share, then in that event, the Executive
shall only be required to tender 25,000 shares of the
62,500 shares of Employer Common Stock so acquired by
the Executive in order to pay off the $200,000
Executive Note and the Executive shall be entitled to
keep the remaining 37,500 shares of Employer Common
Stock free and clear of any obligation to the
Employer.
(ii) Executive Has $50,000 Maximum Downside Loss
Risk: The Executive shall also bear the risk of any
decline in the value of the Employer Common Stock,
but only to the maximum extent of the $50,000 that
Executive pays for the 12,500 shares of Employer
Common Stock that the Executive is purchasing with
his own funds. That is to say, in the event that the
Employer Common Stock declines in value from, for
example, $4.00 per share to $3.00 per share, the
Executive can extinguish all of his obligations under
the $200,000 Executive Note by tendering all 62,500
shares of Employer Common Stock (together with a
signed and guaranteed stock power signed in blank)
even though the market value of the 62,500 shares of
Employer Common Stock so tendered by the Executive is
only $187,000.
(iii) Market Value of Stock: The market value of the
Employer Common Stock for the purpose of this
Executive Put shall be determined by taking the
average of the daily mean of the bid and asked price
for such stock for the fifteen (15) days immediately
preceding the business day of the sending of the
notice exercising the Executive Put of such stock by
the Executive.
(iv) Notice: Notice of the Executive's exercise of
the Executive Put shall be given pursuant to the
notice provision of this Agreement.
(v) Put Procedures: In the event that the Executive
exercises the Executive Put by giving notice thereof
pursuant to the notice provisions of this Agreement,
the Executive shall tender such number of shares of
Employer Common Stock necessary to extinguish the
Executive Note and the Executive shall be entitled to
receive the remainder of the 62,500 shares acquired
by the Executive, if any, that remain after such
tender. The shares of Employer Common Stock so
tendered by the Executive shall be delivered to
Employer together with a stock power signed in blank
by the Executive (with his signature guaranteed), and
the remaining shares of Employer Common Stock
acquired by the Executive (being held pursuant to the
Executive Pledge) shall be released from the
Executive Pledge and returned to the Executive free
from any restriction, lien or encumbrance. In
addition, the original of the Executive Note shall be
marked "paid in full" by the Employer and returned to
the Executive.
G. Prepayment: The Executive may prepay the Executive Note either
in whole or part without premium or penalty at any time prior
to the Maturity Date of the Executive Note; provided however,
in the event that of a partial prepayment of the Executive
Note, no shares of such stock held pursuant to the Executive
Pledge shall be released to the Executive until the Executive
Note is paid in full pursuant to the terms and subject to the
conditions hereof and upon the occurrence of such payment in
full, the number of shares of such stock so released from the
Executive Pledge shall be determined as set forth elsewhere in
this Agreement.
(The provisions of this Section 3.6 of this Agreement shall be referred
to as the "Stock Loan/Purchase Program.")
3.8 Additional Incentive/Non-Qualified Stock Option: In addition to the
Base Salary, the Employer agrees to adopt a non-qualified stock option plan (the
"Non-Qualified Stock Option Plan") and, as part of such plan, to award the
Executive non-qualified stock options (the "Non-Qualified Stock Options") to
acquire 175,000 shares of Employer's Common Stock in accordance with the
following table the ("NQSO Table") and pursuant to the following terms and
subject to the following conditions (the "NQSO Terms and Conditions"):
NQSO Table
Grant Amount Strike Price Vesting Market Price
25,000 $4.00 $8.00
50,000 $6.00 $10.00
50,000 $8.00 $12.00
50,000 $10.00 $14.00
-------
175,000
NQSO Terms and Conditions
A. Vesting: In order for the Executive to qualify for the vesting
in accordance with the NQSO Table, the Employer Stock bid
price (as reported on NASDAQ) must be at or higher than the
Vesting Market Price stated in the NQSO Table for fifteen (15)
consecutive business days.
X. Xxxxx Date: The effective grant date of the Non-Qualified
Stock Options shall be the next day following the date on
which the Employer Stock price has been at the vesting price
for the required fifteen (15) day period.
C. MBO Goal Must Be Met To Make NQSO Plan Effective: In addition
to the foregoing provisions, the Non-Qualified Stock Option
Plan shall not become effective unless and until the Required
MBO Goal (as defined and described below) occurs.:
The "Required MBO Goal" shall mean and refer to Ney,
in a manner acceptable to the Board, either: (a)
having completed an acquisition of a business that
has annual revenues of in excess of $15 million, or
(b) having completed an initial public offering of
the stock of Ney.
The Executive acknowledges and understands that the occurrence
of the Required MBO Goal relates solely and only to the
effectiveness of the Non-Qualified Stock Option Plan and that
other MBO Goals may, and probably will be established in
accordance with the standard practices of the Employer, for
the purpose of determining the compensation to be paid to
Executive pursuant to the Incentive Bonus Compensation plan
discussed and described above.
4. Definition of "Cause" The Executive and the Employer agree that the
Employer may terminate the Executive either for "Cause" or not for "Cause" at
any time during the term of this Agreement and the parties agree that for the
purposes of this Agreement, the term, "Cause," shall mean and refer to the
following:
A. Executive's Conviction of a Felony (which, through lapse of time or
otherwise, is not subject to appeal);
B. Material dishonesty or wrongful taking by the Executive established to
the satisfaction of a majority of the Board;
C. Willful failure or refusal by the Executive without proper cause (i) to
perform his obligations under this Agreement or (ii) because of the Executive's
material breach without proper cause of any of the covenants provided for in
this Agreement or (iii) because of the Executive's willful and repeated failure
or refusal without proper cause to follow the instructions of the Board, all as
determined by a majority of the Board. Such termination as set forth in this
paragraph C. shall be effected by notice thereof delivered by the Employer to
the Executive and shall be effective as of the date of such notice; provided,
however, that if (i) such termination pursuant to this paragraph C. is because
of the Executive's willful refusal without proper cause to perform any one or
more of his obligations under this Agreement, (ii) such notice is the first such
notice of termination for any reason delivered by Employer to the Executive
hereunder within any six (6) month period and (iii) within seven days following
the date of such notice the Executive shall cease his refusal and shall use his
best efforts to perform such obligations, the termination shall not be
effective.
5. Expense Reimbursement. Employer shall pay or reimburse the Executive
for all reasonable expenses actually incurred or paid by the Executive during
the term of employment in the performance of his services hereunder upon
presentation of expense statements or vouchers or such other supporting
information as Employer may reasonably require of the Executive.
6. Indemnification. The Executive shall be entitled through the term of
employment to the benefit of the indemnification provisions contained on the
date hereof in the By-Laws of the Employer as the same may hereafter be amended,
and of any indemnification provisions that may hereafter be added to the
Certificate of Incorporation of the Employer, to the extent permitted by
applicable law at the time of the assertion of any liability against the
Executive. The Executive shall also be entitled to the benefit of any Directors
and Officers Liability Insurance that the Employer may elect to maintain in
effect pursuant to the terms and subject to the conditions of such the policies
that evidence such coverage.
7. Mitigation of Damages. In the event of the termination of the term
of employment by the Employer not for "Cause," the Executive shall,
nevertheless, be required to mitigate the Executive's damages hereunder;
provided however, the obligation of the Executive to mitigate damages shall not
apply to the 90 days Base Salary portion of the Severance payments required by
this Agreement.
8. Legal Costs. If either party institutes any legal action to enforce
his or its rights under, or to recover damages for breach of, this Agreement,
each party shall pay for his or its legal cost and expenses including attorneys
fees.
9. Death and Permanent Disability. In the event of the Executive's
death or permanent disability, the Executive shall receive such payments
hereunder as shall be awarded to him by a majority of the Board as determined in
its sole and complete discretion after taking into consideration all of the
relevant circumstances. The Board decision in this regard shall be final and
binding on the parties hereto.
10. Office Facilities and Services. During the term of the employment
the Executive shall be accorded such benefits and support services, including
but not limited to office facilities, secretarial, financial, communications,
security and transportation services and other allowances as are determined to
be reasonable and necessary by the Board.
11. Other Benefits. During the term of employment, the Executive shall
remain eligible to participate in any plan or program of the Employer now
existing or established hereafter, to the extent that he is eligible under the
general provisions thereof.
12. Protection of Confidential Information.
The Executive acknowledges that his employment by the Employer will,
throughout the term of employment, bring him into close contact with many
confidential affairs of the Employer, including information about costs,
profits, markets, sales, products, key personnel, pricing policies, operational
methods, technical processes and other business affairs and methods and other
information not readily available to the public, and plans for future
developments. The Executive further acknowledges that the services to be
performed under this Agreement are of a special, unique, unusual, extraordinary
and intellectual, character. The Executive further acknowledges that the
business of the Employer is international in scope, that its products are
marketed throughout the world, that the Employer competes in nearly all of its
business activities with other organizations which are or could be located in
nearly any part of the world and that the nature of the Executive's services,
position and expertise are such that he is capable of competing with the
Employer from nearly any location in the world. In recognition of the foregoing,
the Executive covenants and agrees:
A. That the Executive will keep secret all material confidential
matters of the Employer and will not intentionally disclose
them to anyone outside of the Employer, either during or after
the term of employment except with the Employer's written
consent, provided that (i) the Executive shall have no such
obligation to the extent such matters are or become publicly
known other than as a result of the Executive's breach of his
obligations hereunder and (ii) the Executive may, after giving
prior written notice to the Employer to the extent practicable
under the circumstances, disclose such matters to the extent
required by applicable laws or governmental regulations or
judicial or regulatory process; and
B. That he will deliver promptly to the Employer on termination
of his employment by the Employer, or at any other time the
Employer may so request, at the Employer's expense, all
memoranda, notes, records, reports and other documents (and
all copies thereof) relating to the Company's business, which
he obtained while employed by, or otherwise serving or acting
on behalf of, the Employer and which he may then possess or
have under his control.
C. Hiring Restrictions. If the term of employment is terminated
pursuant to this Agreement, for a period of two years after
such termination without the consent of the Employer, the
Executive shall not employ, and shall not cause any entity of
which he is an affiliate to employ, any person who was a
full-time employee of the Employer or any of its subsidiaries
at the date of such termination or within six months prior
thereto.
D. Specific Remedy. In addition to such other rights and remedies
as the Employer may have at equity or in law with respect to
any breach of this Agreement, if the Executive commits a
material breach of any of the provisions of Section 4, the
Employer shall have the right and remedy to have such
provisions specifically enforced by any court having equity
jurisdiction, it being acknowledged and agreed that any such
breach threatened breach will cause irreparable injury to the
Employer and that money damages will not provide an adequate
remedy to the Employer.
13. Ownership of Work Product. The Executive acknowledges that during
the term of employment, he may conceive of, discover, invent or create
inventions, improvements, new contributions, literary property, material, ideas
and discoveries, whether patentable or copyrightable or not (all of the
foregoing being collectively referred to herein as "Work Product") and that
various business opportunities shall be presented to him by reason of his
employment by the Employer. The Executive acknowledges that, unless the Employer
otherwise agrees in writing, all of the foregoing shall be owned by and belong
exclusively to the Employer and that he shall have no personal interest therein,
provided that they are either related in any manner to the business (commercial
or experimental) of the Employer, or are, in the case of Work Product, conceived
or made on the Employer's time or with the use of the Employer's facilities or
materials, or, in the case of business opportunities, are presented to him for
the possible interest or participation of the Employer. The Executive shall
further, unless the Employer otherwise agrees in writing, (i) promptly disclose
any such Work Product and business opportunities to the Employer; (ii) assign to
the Employer, upon request and without additional compensation, the entire
rights to such Work Product and business opportunities; (iii) sign all papers
necessary to carry out the foregoing; and (iv) give testimony in support of his
inventorship or creation in any appropriate case. The Executive agrees that he
will not assert any rights to any Work Product or business opportunity as having
been made or acquired by him prior to the date of this Agreement except for Work
Product or business opportunities, if any, disclosed to and acknowledged by the
Employer in writing prior to the date hereof.
14. Notices. All notices, requests, consents and other communications,
required or permitted to be given hereunder, shall be in writing and shall be
deemed to have been duly given if delivered personally or sent by prepaid
telegram, or mailed first-class, postage prepaid, by registered or certified
mail, as follows (or to such other or additional address as either party shall
designate by notice in writing to the other in accordance herewith):
A. If to the Employer: to the address set forth on the first page of this
Agreement.
B. If to the Executive, to him at his address on the personnel records of
the Employer.
15. General.
A. Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of New York applicable to
agreements made and to be performed entirely in New York.
B. Captions. The section headings contained herein are for reference
purposes only and shall not in any way affect the meaning or interpretation of
this Agreement.
C. Entire Agreement. This Agreement sets forth the entire agreement and
understanding of the parties relating to the subject matter hereof, and
supersedes all prior agreements, arrangements and understandings, written or
oral, between the parties
D. No Other Representations. No representation, promise or inducement has
been made by either party that is not embodied in this Agreement, and neither
party shall be bound by or liable for any alleged representation, promise or
inducement not so set forth.
E. Assignability. This Agreement, and the Executive's rights and
obligations hereunder, may not be assigned by the Executive.
the Employer may assign its rights, together with its
obligations, hereunder in connection with any sale, transfer
or other disposition of all or substantially all of its
business and assets; and such rights and obligations shall
inure to, and be binding upon, any successor to the business
or substantially all of the assets of the Employer, whether by
merger, purchase of stock or assets or otherwise, and such
successor shall expressly assume such obligations.
F. Amendments; Waivers. This Agreement may be amended, modified,
superseded, cancelled, renewed or extended and the terms or
covenants hereof may be waived, only by a written instrument
executed by both of the parties hereto, or in the case of a
waiver, by the party waiving compliance. The failure of either
party at any time or times to require performance of any
provision hereof shall in no manner affect the right at a
later time to enforce the same. No waiver by either party of
the breach of any term or covenant contained in this
Agreement, whether by conduct or otherwise, in any one or more
instances, shall be deemed to be, or construed as, a further
or continuing waiver of any such breach, or a waiver of the
breach of any other term or covenant contained in this
Agreement.
G. Changes in Capital Structure. For all purposes of this Agreement, (i)
all references to "shares" of the Employer ----------------------------- Common
Stock shall mean the shares of the Employer Common Stock as they exist on the
date hereof, and all securities issued or exchanged with respect to such shares
upon any recapitalization, reclassification, merger, consolidation, spin-off,
split, dividend, distribution, subdivision or combination of such shares or the
like; and all references regarding stock price information shall be equitably
adjusted to take into account all events or transactions referred to in the
preceding clause (i); and (iii) if sales of the Employer Common Stock are no
longer reported on the Composite Tape, all references herein to "as reported on
the Composite Tape" shall refer to as reported on the principal national
securities exchange on which the Employer Common Stock is listed or admitted to
trading, or, if the Employer Common Stock is not listed or admitted to trading
on any national securities exchange, as reported by the National Association of
Securities Dealers, Inc. through NASDAQ or a similar organization if NASDAQ is
no longer reporting such information or if not so reported, the sales price of a
share of the Employer Common Stock shall be equitably determined.
H. Offsets. the Employer shall be entitled to offset and deduct from those
payments due to the Executive under this Agreement for money borrowed by the
Executive from the Employer.
[The Remainder of this Page Intentionally Left Blank. The Next Page is the
Signature Page.]
IN WITNESS WHEREOF, the parties have duly executed this
Agreement as of the date first above written.
XXXXXXXX GROUP, INC.
BY: __________________________
Name: __________________
Title: ___________________
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XXXXX XXXXXX
