BURGERFI INTERNATIONAL, INC. EMPLOYMENT AGREEMENT
Exhibit 10.12
THIS EMPLOYMENT AGREEMENT (“Agreement”) is made and entered into effective as of the 16th day of December, 2020, by and between BurgerFi International, Inc., a Delaware corporation (“Company”), and Xxxxx Xxxxxxx (“Executive”).
WITNESSETH:
WHEREAS, on the terms and subject to the conditions hereinafter set forth, Company desires to engage Executive as Chief Executive Oficer, and Executive desires to work with Company, to render Executive’s duties described herein to Company.
NOW, THEREFORE, in consideration of the mutual promises set forth herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:
1. Employment; Title; Duties and Location. Company hereby agrees to employ Executive on an exclusive basis, to render the duties set forth herein as an at-will employee of Company, and Executive hereby accepts such employment with Company, for the Compensation (as hereinafter defined) and on the terms and subject to the conditions set forth herein. During the Employment Period (as defined in Section 2 below), Executive shall serve the Company as Chief Executive Officer and shall report exclusively and directly to the Board of Directors and its Executive Chairman. Executive shall perform the duties consistent with Executive’s title and position and such other duties commensurate with such position and title as shall be specified or designated by Company from time to time. Subject to Executive’s appointment thereto, and without additional compensation, Executive shall hold such other or additional titles and serve, during the Employment Period, in such other or additional capacities to which Executive may be appointed from time to time in Company and its affiliated companies, provided such titles and additional capacities are consistent with Executive’s above-stated position and duties. The principal place of performance by Executive of Executive’s duties hereunder shall be the Company’s corporate offices in Palm Beach County, Florida, or such other location of the corporate offices from time to time, although Executive may be required to reasonably travel outside of such area in connection with the performance of Executive’s duties.
1.1 Executive agrees to conduct its business and activities so as to maintain and increase the goodwill and reputation of Company.
1.3 Executive acknowledges that Company’s interest in maintaining and promoting Company’s reputation for quality and service. From time to time, Company may establish reasonable policies, procedures and requirements that will be applicable and disseminated to its Executives. Executive hereby agrees to strictly comply with all such policies, procedures and requirements.
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2. Term. Executive’s employment hereunder shall commence on the date hereof (the “Commencement Date”) and shall continue for a one-year period thereafter (the “Initial Term”), subject to earlier termination exclusively as provided for in Section 6 below, and subject to extension as provided in the following sentence. Following the Initial Term, provided Executive’s employment has not previously been terminated, Executive’s employment hereunder shall automatically be extended for successive, one-year periods (each a “Renewal Term”), subject to earlier termination exclusively as provided for in Section 6 below. For the purposes of this Agreement, the “Term” at any given time shall mean the Initial Term as it may have been extended by one or more Renewal Terms as of such time (without regard to whether Executive’s employment is terminated prior to the end of such Term), and the “Employment Period” means the period of Executive’s employment hereunder (regardless of whether such period ends prior to the end of the Term and regardless of the reason for Executive’s termination of employment hereunder).
3. Compensation. As compensation in full for the performance of Executive’s duties hereunder (the “Compensation”), Company shall pay Executive:
3.1 Salary. Executive shall receive a base salary (the “Base Salary”) payable in substantially equal installments in accordance with Company’s normal payroll practices and procedures in effect from time to time and subject to applicable withholdings and deductions. Executive’s starting Base Salary shall be at the annual rate of $275,000.00, subject to review at the end of each Term by the Compensation Committee of the Board of Directors in consultation with Executive Chairman. Executive acknowledges and agrees that Executive may be paid by a parent Company or other affiliate of Company (“Paymaster”). Notwithstanding payment by Paymaster or reimbursement by an affiliate, Executive acknowledges and agrees that his sole contractual arrangement is with Company, Executive is not an employee of Paymaster or any affiliate, and Executive shall not have any claims against Paymaster or any affiliate relating to or arising out of Executive’s engagement by Company.
3.2 Incentive Bonus. Executive shall also be eligible for an annual incentive bonus of up to $100,000.00, payable entirely in common stock of Company (the “Incentive Bonus”), based on the achievement of certain key performance indicators (the “Key Performance Indicators”) set forth on Exhibit A hereto, at the sole and exclusive discretion of the Executive Chairman.
3.3 Restricted Stock. Executive will have the ability to earn up to 250,000 shares of Company’s common stock in restricted stock grants through Company’s Omnibus Incentive Plan (collectively, the “Restricted Stock Grants”). Such Restricted Stock Grants shall be earned by Executive in equal amounts (i.e., 50,000 each) at the yearly anniversary of the Commencement Date for each of the first five years of employment with Company, subject to Executive’s achievement of the Key Performance Indicators set forth on Exhibit A hereto, so long as Executive is still an employee in good standing at the time of each such anniversary, subject to the terms and conditions of the Restricted Stock Purchase Agreement annexed hereto as Exhibit B. Shares issued upon each grant will be locked up for 24 months.
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3.4 Benchmark Restricted Stock. Executive shall be eligible to receive up to an additional 100,000 shares of Company common stock in restricted stock grants (“Benchmark Restricted Stock Grants”) upon achievement by Company of the following benchmarks: (i) 25,000 shares, when the last reported closing price of Company’s common stock for any 20 trading days within any consecutive 30 trading day period is greater than or equal to $19.00 per share; (ii) 25,000 shares, when the last reported closing price of the Company’s common stock for any 20 trading days within any consecutive 30 trading day period is greater than or equal to $22.00 per share; and (iii) 50,000 shares, when the last reported closing price of the Company’s common stock for any 20 trading days within any consecutive 30 trading day period is greater than or equal to $25.00 per share. These Benchmark Restricted Stock Grants may not be sold, transferred or conveyed for a twelve-month period following the date upon which they are earned (each, an “Earning Date”), provided that Executive is still an employee in good standing at the time of each such Earning Date, subject to the terms and conditions of the Restricted Stock Purchase Agreement. If there is a Change of Control during the term of Employment all unearned Restricted Stock Grants and Benchmark Restricted Stock Grants shall be deemed to have been earned and vested immediately prior to the Change of Control. A “Change of Control” means the sale of all or substantially all the assets of Company; any merger, consolidation or acquisition of Company with, by or into another corporation, entity or person; or any change in the ownership of more than fifty percent (50%) of the voting capital stock of Company in one or more related transactions.
3.5 Benefits. Executive shall have the right to receive or participate in all employee benefit programs and perquisites generally established by Company from time to time for employees similarly situated to Executive, subject to the general eligibility requirements and other terms of such programs and perquisites, and subject to Company’s right to amend, terminate or take other similar action with respect to any such programs and perquisites.
3.6 Vacation and Other Paid Time Off. Executive shall be entitled to 4 weeks of paid vacation, as well as sick days and any other paid time off, each year in accordance with then current Company policy. Executive shall be entitled to an additional week of paid vacation following the first anniversary of the Commencement Date and another week after the third anniversary.
3.7 Automobile. The Company shall reimburse Executive for all reasonable and properly documented expenses associated with a Company automobile (including automobile insurance, repairs, and gas), up to $1,200 per month.
4. Exclusivity and Best Efforts. During the Employment Period, Executive shall (i) in all respects conform to and comply with the lawful directions and instructions given to Executive by Company; (ii) subject to the proviso below, devote Executive’s entire business time, energy and skill to Executive’s services under this Agreement; (iii) use Executive’s best efforts to promote and serve the interests of Company and to perform Executive’s duties and obligations hereunder in a diligent, trustworthy, businesslike, efficient and lawful manner; (iv) comply with all applicable laws and regulations, as well as the policies and practices established by Company from time to time and made applicable to its employees generally or senior executives; (v) not engage in any other business, profession or occupation for compensation or otherwise; and (vi) not engage in any activity that, directly or indirectly, impairs or conflicts with the performance of Executive’s obligations and duties to Company, provided, however, that the foregoing shall not prevent Executive from managing Executive’s personal affairs and passive personal investments and participating in charitable, civic, educational, professional or community affairs, so long as, in the aggregate, any such activities do not unreasonably interfere or conflict with Executive’s duties hereunder or create a potential business or fiduciary conflict with Company, as reasonably determined by Company.
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5. Reimbursement for Expenses. Executive is authorized to incur reasonable expenses in the discharge of the services to be performed hereunder in accordance with Company’s expense reimbursement policies, as the same may be modified by Company from time to time in its sole and complete discretion (the “Reimbursement Policies”). Company shall reimburse Executive for all such proper expenses upon presentation by Executive of itemized accounts of such expenditures in accordance with the terms of the Reimbursement Policies.
6. Termination. This Agreement shall be for at-will employment and shall continue until one of the parties hereto notifies the other of its intent to terminate this Agreement at a date more than thirty days from the date of the notice. Upon the termination of Executive’s engagement hereunder, Company shall have no further liability hereunder, except to pay Executive all Compensation earned by Executive as of the date of termination and as set forth in Section 6.3 below.
6.1 Executive’s engagement and rights hereunder may be terminated by Company or Executive, as the case may be, immediately upon a breach of this Agreement that, if possible to be cured, has gone uncured for at least 30 days following written notice thereof.
6.2 Upon termination, Executive shall:
(i) Deliver to Company all documents, data, records, and all other materials which are provided by Company to Executive, including any Confidential Information;
(ii) Take all such reasonable actions as shall be requested in writing from time to time by Company consistent with the foregoing and for the orderly transition of the services provided by Executive to either Company or to a new employee, in the discretion of Company.
6.3. Upon termination by Company without cause the Incentive Bonus and all unearned Restricted Stock Grants for the year in which termination occurs shall be deemed to have been earned and vested immediately before such termination. This Section 6 shall survive the termination of this Agreement and Executive’s engagement hereunder.
7. Confidential Information and Competition. Executive has entered into that certain Agreement Regarding Confidential Information and Prohibiting Competition attached hereto as Exhibit C, the terms and conditions of which are hereby incorporated by this reference, and agrees that nothing herein shall limit or restrict the obligations of Executive thereunder or enforcement of the terms thereof. As used herein, the term “Confidential Information” shall have the meaning set forth in the Agreement Regarding Confidential Information and Prohibiting Competition. This Section 7 shall survive the termination of this Agreement and Executive’s engagement hereunder.
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8. Trade Names and Trademarks. Executive agrees that he will use only such trade names, trademarks or other designations of Company or any simulations thereof as may be authorized in writing by Company. All such use shall be in accordance with Company's instructions and any such authorization may be withdrawn or modified at any time. Executive will, in the event this Agreement is terminated, cease all use of any of Company's trade names, trademarks or other designations or other simulations thereof. Executive will not register or attempt to register or assert any right of ownership in any of Company's trade names, trademarks or other designations or any simulations thereof. Executive shall immediately notify Company in writing upon learning of any potential or actual infringement of any trademark, patent, copyright or other proprietary right owned by or licensed to Company, or of any actual or potential infringement by Company of the rights of any third party.
9. Miscellaneous.
9.1 Notices. Any notice required or permitted to be delivered to any party under the provisions of this Agreement shall be deemed to have been duly given (a) upon hand delivery thereof, (b) upon telefax or email and written confirmation of transmission, (c) upon proof of delivery and receipt of any overnight deliveries, or (d) on the third (3rd) business day after mailing United States registered or certified mail, return receipt requested, postage prepaid, addressed to each party as follows:
| To Company: | 000 X.X. Xxxxxxx Xxx |
| Xxxxx Xxxx Xxxxx, XX 00000 | |
| With a copy to: | 0000 XX 0xx Xxxxxx |
| Xxxxx, XX 00000 | |
| Attention: General Counsel | |
| To Executive: | to the address set forth on the signature page |
or to such other address or such other person as any party shall designate, in writing, to the others for such purposes and in the manner set forth in this Section.
9.2 Accuracy of Statements. No representation or warranty contained in this Agreement, and no statement delivered, or information supplied to any party pursuant hereto, contains an untrue statement of material fact or omits to state a material fact necessary to make the statements or information contained herein or therein not misleading. The representations and warranties made in this Agreement will be continued and will remain true and complete in all material respects and will survive the execution of the transactions contemplated hereby.
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9.3 Entire Agreement. This Agreement sets forth all the promises, covenants, agreements, conditions and understandings between the parties hereto, and supersedes all prior and contemporaneous agreements, understandings, inducements or conditions, expressed or implied, oral or written, except as herein contained.
9.4 Binding Effect; Assignment. This Agreement shall be binding upon the parties hereto, their heirs, administrators, successors and assigns. Except as otherwise provided in this Agreement, no party may assign or transfer its interests herein, or delegate its duties hereunder, without the written consent of the other party. Any assignment or delegation of duties in violation of this provision shall be null and void.
9.5 Amendment. The parties hereby irrevocably agree that no attempted amendment, modification, termination, discharge or change of this Agreement shall be valid and effective, unless the parties shall unanimously agree in writing to such amendment.
9.6 No Waiver. No waiver of any provision of this Agreement shall be effective unless it is in writing and signed by the party against whom it is asserted, and any such written waiver shall only be applicable to the specific instance to which it relates and shall not be deemed to be a continuing or future waiver.
9.7 Gender and Use of Singular and Plural. All pronouns shall be deemed to refer to the masculine, feminine, neuter, singular or plural, as the identity of the party or parties, or their personal Executives, successors and assigns may require.
9.8 Headings. The article and section headings contained in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of the Agreement.
9.9 Governing Law. This Agreement shall be construed in accordance with the laws of the State of Florida and any proceeding arising between the parties in any manner pertaining or related to this Agreement shall, to the extent permitted by law, be held in Palm Beach County, Florida.
9.10 Further Assurances. The parties hereto will execute and deliver such further instruments and do such further acts and things as may be reasonably required to carry out the intent and purposes of this Agreement.
9.11 Litigation. If any party hereto is required to take any action or engage in litigation against any other party hereto, either as plaintiff or as defendant, in order to enforce or defend any rights under this Agreement, and such litigation results in a final judgment in favor of such party, then the party or parties against whom said final judgment is obtained shall reimburse the prevailing party for all direct, indirect or incidental expenses incurred, including, but not limited to, all attorneys' fees, court costs and other expenses incurred throughout all negotiations, trials or appeals undertaken in order to enforce the prevailing party's rights hereunder.
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9.12 Mediation. Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall be settled by a mediation administered by a mutually agreed upon mediator and, except as set forth below, the cost of any such mediation shall be shared equally by all parties thereto. Any judgment on the award rendered by the mediator(s) may be entered in any court having jurisdiction thereof. During any mediation related to the Agreement, the parties shall continue to perform their respective obligations under this Agreement. The prevailing party in any enforcement of this Agreement shall be entitled to recover all costs and expenses of such enforcement, including costs of litigation, and attorneys’ fees, costs, and expenses, at trial through appeal.
9.13 Indemnification; D&O Insurance.
(i) Company hereby agrees to indemnify Executive and to defend and hold him harmless to the fullest extent permitted by law and under the by-laws of Company against and in respect to any and all actions, suits, proceedings, claims, demands, judgments, costs, expenses (including reasonable attorney's fees at all levels of proceedings), losses, and damages resulting from Executive's good faith performance of his duties and obligations hereunder. This Section 9.13(i) shall survive the termination of this Agreement and Executive’s engagement hereunder.
(ii) Company shall purchase and maintain insurance, at its expense, to protect itself and Executive while serving in such capacity to Company or on behalf of Company as an officer or director or employee of any affiliate of Company.
9.14 Counterparts. This Agreement may be executed in counterparts and by facsimile and/or e-mail .pdf, each of which shall constitute originals and all of which, when taken together, shall constitute the same original instrument, legally binding all parties to this Agreement.
THIS SPACE INTENTIONALLY BLANK
SIGNATURES CONTINUED ON FOLLOWING PAGE
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With full power and authority and intedning to be legally bound, the parties hereto have executed this Agreement as of the date first above written.
| COMPANY: | ||
| BurgerFi International, Inc. | ||
| By: | /s/ Xxxxx Xxxxxxxxx | |
| Xxxxx Xxxxxxxxx, Executive Chairman | ||
| EMPLOYEE: | ||
| /s/ Xxxxx Xxxxxxx | ||
| Xxxxx Xxxxxxx | ||
| Address: | ||
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EXHIBIT A
Key Performance Idicators (KPIs)
To be agreed upon by Executive and Company as soon as possible
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EXHIBIT B
RESTRICTED STOCK GRANT AGREEMENT
To be provided by Company to Executive as soon as possible
A-2
EXHIBIT C
AGREEMENT REGARDING CONFIDENTIAL INFORMATION
AND
PROHIBITING COMPETITION
I, the undersigned employee of BurgerFi International, Inc., a Delaware corporation (the "Company"), am entering into this Agreement in consideration of my employment by the Company. The Company is in the business of operating gourmet fast food and quick service casual restaurants focused on all-natural hamburgers, vegetarian burgers, hormone-free chicken, and other complementary food offerings (the "Company's Business"). I hereby acknowledge that, in conjunction with the performance of my duties as an employee of the Company, I will be exposed to, making use of, acquiring and adding to confidential information of a special and unique nature and value affecting and relating to the Company and its financial operations, including, but not limited to: the Company's Business, the identity of the Company's clients, the prices being charged by the Company to such clients, the Company's contracts, business records and other records, the Company's trade secrets, customer lists, vendors and vendor lists, recipes, billing forms, methods, and procedures, trade names, manuals, photographs, samples, literature, sales aids of every kind, software, advertising methods and strategies, information regarding advertising locations, style and wording of all advertising, plans for expansion or marketing strategies, and other similar information relating to the Company and the Company's Business (all the foregoing being hereinafter referred to collectively as "Confidential Information"). I agree that the Confidential Information is a trade secret of, and is owned solely by, the Company.
I acknowledge that the disclosure of Confidential Information to competitors of the Company would cause the Company irreparable injury. Because I have been and will be exposed to Confidential Information, the Company requires, as a condition to my employment with the Company, that I, the undersigned, execute and deliver to the Company this legally binding agreement ("Agreement"), which is intended to protect the Company from my unauthorized use of the Confidential Information and to prohibit the Company’s competitors from receiving the benefits of my knowledge of the Company’s Business or the specialized training that the Company has provided or will provide to me. This Agreement does not obligate the Company to employ or retain me for any specific length of time. Although the Company seeks to retain valued employees and independent contractors, employment with the Company remains terminable by the Company "at will."
I agree that all Confidential Information is owned exclusively by the Company, that I may use the Confidential Information only when permitted by the Company and only for the benefit of the Company, that at all times during and subsequent to my employment with the Company, I will not disclose any Confidential Information to any other person or entity for any reason whatsoever, and that I will at all times take such actions as shall be necessary to maintain the confidentiality of the Confidential Information and to prevent its unauthorized disclosure.
I agree that, upon the Company's demand, whether verbal or written, I will promptly deliver as directed, without retaining copies, all materials and media in my possession that contain Confidential Information or that relate to the Company’s Business. I agree that the fact that I had knowledge, or that others may have had knowledge, of Confidential Information prior to the execution of this Agreement shall not in any way limit or affect my obligations under this Agreement.
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I agree that all copyrightable, patentable or unpatentable business information, and other proprietary information, inventions, techniques, know-how, materials and Confidential Information created by me during my employment with the Company, together with all rights relating to said property, are the exclusive property of the Company and its assigns. I further agree that this Agreement constitutes a "Work for Hire" with respect to any copyrightable works created by me during my employment with the Company. I agree to execute all documents, including, but not limited to, assignments of rights, that the Company may request to assist in establishing its ownership of such property.
During the term of my employment with the Company, I will not directly or indirectly, in any location, operate, organize, maintain, establish, manage, own, participate in, or in any manner whatsoever, individually or through any corporation, firm or organization of which I shall be affiliated in any manner whatsoever, have any interest in, whether as owner, investor, operator, partner, stockholder, director, trustee, officer, mortgagee, employee, independent contractor, principal, agent, consultant or otherwise, any other business or venture which engages in the Company's Business, or is otherwise in competition with Company or any assigns of the Company, unless such activity shall have been previously agreed to in writing by Company and its successors and assigns (I acknowledge that the Company's Business is advertised and conducted throughout the United States, and accordingly that this covenant against competition shall extend to the entire United States). Further, during the term of my employment with the Company and for a period of two (2) years thereafter (the “Restricted Period”), I will not: (i) directly or indirectly, divert from the Company or its successors or assigns any proprietary product or service of Company, or cause any client or account of Company to cease using or acquiring Company’s products or services; or (ii) directly or indirectly, solicit for employment, employ or otherwise engage the services of, any employees, independent contractors, vendors, agents, or consultants of the Company or its successors or assigns, provided, however, that nothing set forth herein shall limit Executive’s right to compete with Company and to work for any competitor of Company after termination of this Agreement.
I acknowledge that I may be performing services at one or more locations that are shared facilities with other entities that may be affiliates of the Company (“Affiliated Entities”). The Affiliated Entities each have their own respective confidential information like that described as the Company’s Confidential Information, and that the Affiliated Entities intend that such confidential information remain confidential under agreements like this agreement. If I should be exposed to or learn of any such confidential information, I agree that it is protected information that shall be owned by the Affiliated Entities in the same manner as the Confidential Information is owned and protected by the Company. Further, I agree that in no event shall any such confidential information be used by me for the purpose of competing with, or to solicit customers, employees, agents or independent contractors of, the Company or any Affiliated Entity. The Affiliated Entities are intended third party beneficiaries for the purpose of enforcing the foregoing.
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I agree that if I breach or threaten to breach this Agreement, the Company will be entitled to receive, in addition to all other remedies to which it may be entitled at law or in equity, temporary and permanent injunctions prohibiting any breach of this Agreement by me, or by my partners, agents, representatives, servants, employers, employees, independent contractors and all persons directly or indirectly acting for or with me. In the event the Company obtains a temporary or permanent injunction, I agree that any such injunction shall compute the two (2) year restriction from the date the injunction is entered. The Company shall also be entitled to receive from me reimbursement of all its reasonable attorneys' and other legal fees and costs that it incurs in enforcing this Agreement, inclusive of all such fees and costs incurred with respect to all negotiations, trial and appellate proceedings. This Agreement shall be interpreted under the laws of the State of Florida, and the venue for any proceedings under this Agreement shall be Palm Beach County, Florida. I hereby submit to the jurisdiction of any state or federal courts in Palm Beach County, Florida for purposes of the foregoing. The terms of this Agreement shall survive the termination of my employment by the Company.
Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall be settled by a mediation administered by a mutually agreed upon mediator and, except as set forth below, the cost of any such mediation shall be shared equally by all parties thereto. Any judgment on the award rendered by the mediator(s) may be entered in any court having jurisdiction thereof. During any mediation related to the Agreement, the parties shall continue to perform their respective obligations under this Agreement. The prevailing party in any enforcement of this Agreement shall be entitled to recover all costs and expenses of such enforcement, including costs of litigation, and attorneys’ fees, costs, and expenses, at trial through appeal.
I agree that the restrictions contained in this Agreement are fair and reasonably necessary to protect the legitimate business interests of the Company, and will not unfairly restrict my ability to find gainful work in my field. I also agree that if a court determines that any of the restrictions in this Agreement are unenforceable, the court, in so establishing a substitute restriction, shall recognize that I agree that the restrictions described above be imposed and maintained to the maximum lawful extent. I hereby certify that no representative or agent of the Company has represented, expressly or otherwise, that the Company would not seek to enforce this Agreement. The provisions contained herein shall be binding upon me as an independent obligation and shall be enforceable even if there is or is claimed to be a breach of this Agreement or any other agreement, understanding, commitment or promise by the Company. The Company’s failure or refusal to enforce any of the terms contained in this Agreement against any other employee or independent contractor or former employee or independent contractor for any reason, shall not constitute a defense to the enforcement of this Agreement against me.
I agree that I will not at any time (during or after my employment with the Company) disparage the reputation of the Company, or its customers, vendors, merchants, officers, members, manager, directors, agents, employees or independent contractors.
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By executing this Agreement in the space provided below I confirm that I have read, understand and agree to all the provisions of this Agreement and that I agree to be legally bound by the terms of this Agreement. This Agreement is for the benefit of and may be enforced by the Company, its successors and assigns.
| Agreed to this 16th Day of December, 2020 | |
| /s/ Xxxxx Xxxxxxx | |
| SIGNATURE | |
| Xxxxx Xxxxxxx | |
| PRINT NAME | |
| ADDRESS: | |
| Phone:_________________________________ | |
| Email:__________________________________ |
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