EXHIBIT 10.3
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, dated as of ___________, 2002, by and between AmeriFirst
Capital Corp., a Georgia corporation with executive offices at 000 Xxxxx Xxxx,
Xxxxx 000, Xxxxxxxxx, Xxxxxxx 00000 (the "Company"), and Xxxx Xxxxx, an
individual residing at 0000 Xxxxxxxxx Xxxxx Xxxx, Xxxxxxxxxxxx, Xxxxxxx 00000
("Executive").
WITNESSETH:
WHEREAS, subject to the terms and considerations hereinafter set forth,
the Company wishes to employ Executive in the positions set forth herein and
Executive wishes to accept such employment.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein set forth, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. EMPLOYMENT.
The Company hereby employs Executive and Executive hereby accepts such
employment, as an executive of the Company, subject to the terms and conditions
set forth in this Agreement.
2. TERM OF EMPLOYMENT.
Subject to the provisions for termination provided herein, the initial
term of employment of Executive under this Agreement shall be for a period of
three (3) years commencing on August 1, 2002 and ending on July 31, 2005 (the
"Initial Term"). Executive's employment under this Agreement shall be
automatically extended for successive one-year periods (the Extension Term")
unless either party gives a notice of termination not earlier than 180 days and
not later than 90 days prior to the expiration of the Initial Term or any
Extension Term. The Initial Term and Extension Term are referred to herein as
the "Term".
3. DUTIES.
Executive shall serve as President and Chief Executive Officer of the
Company and shall properly perform such duties as may be assigned to him from
time to time by the Company's Board of Directors (the "Board of Directors").
During the Term of this Agreement, Executive shall devote his full attention and
apply his best-efforts, energies and skills on a full-time basis, to the
business of the Company, and shall not during the Term of this Agreement be
engaged in any other business activity, whether or not such business activity is
pursued for gain, profit, or other pecuniary advantage, unless otherwise
authorized by the Board of Directors. Subject to the provisions of Section 7
hereof, the foregoing restriction shall not be construed as preventing Executive
from investing his assets in such form or manner as will not require any
services on his part in the operation of the affairs of the companies in which
such investments are made.
4. COMPENSATION OF EXECUTIVE.
4.1 BASE SALARY. Executive retains an equity interest in the Company and
hereby agrees to forego any cash compensation for his services hereunder. The
foregoing shall not be deemed to mean that Executive shall never be entitled to
compensation for his services. During the Term of this Agreement, the Board of
Directors may decide to compensate Executive for his services hereunder on an
annual basis, in an amount to be determined by the Board of Directors ("Base
Salary"). In the event Executive is provided a Base Salary, such Base Salary
shall be subject to the terms and conditions of this Agreement, as may be
amended.
4.2 INCENTIVE COMPENSTAION. The Company shall pay to Executive such
incentive compensation ("Incentive Compensation") from time to time, as shall be
determined by the Board of Directors.
4.2 TIME OF PAYMENT. Executive's Base Salary shall be paid in
substantially equal installments on a basis consistent with the Company's
payroll practices for senior executives. All amounts payable hereunder shall be
subject to all applicable withholding taxes.
4.3 EXPENSES. During the Term, the Company shall reimburse Executive for
all reasonable and necessary travel expenses and other disbursements incurred by
Executive on behalf of the Company in the performance of Executive's duties
hereunder, assuming Executive has received prior approval for such travel
expenses and disbursements by the Company to the extent possible, consistent
with the Company's practice or written policy in effect with respect to the
reimbursement of expenses to senior executives of the Company. Such expenses
shall be reimbursed only upon presentation of paid receipts and/or original
invoices and such other information as shall be required for tax purposes.
4.4 BENEFITS. During the Term, Executive shall be entitled to participate
in any pension or profit sharing plan, stock purchase plan, stock option plan,
group life insurance plan, hospitalization insurance plan, and medical services
plan and other similar plans, now or hereafter existing, afforded to other
senior executives.
4.5 VACATION. Executive shall be entitled to a vacation of four (4) weeks
per year, during which period his Base Salary shall be paid in full. Executive
shall take his vacation at such time or times as Executive and the Company shall
determine is mutually convenient. Executive shall not take more than two
consecutive weeks of vacation during any fiscal year. No portion of any unused
vacation time shall be carried over to a subsequent period unless specifically
authorized by the Company.
5. TERMINATION.
5.1 DEATH OR TOTAL DISABILITY.
(a) DEATH. This Agreement shall terminate upon the death of
Executive; provided, however, that the Company shall continue to pay to the
estate of Executive the Base Salary as set forth in Section 4.1 up to the end of
the month in which his death occurs, plus any Incentive Compensation earned
through the date of termination and all unpaid expense reimbursements as of such
date. The Company shall have no further obligation to Executive's estate.
(b) DISABILITY. If Executive is unable to perform his duties
hereunder by reason of physical or mental incapacity or infirmity (a
"Disability") for a continuous period of six (6) months or any one hundred
ninety (190) business days during any period of two hundred fifty (250)
continuous business days, then Executive shall be "Disabled" for purposes of
this Agreement and the period of his Disability as provided above shall be
referred to herein as the "Disability Period." The existence of a Disability
hereunder shall be determined by a licensed physician selected by the Company,
and Executive hereby consents to an examination by such physician for such
purpose. During the Disability Period, the Company shall continue to pay
Executive his Base Salary and any Incentive Compensation earned hereunder;
provided, however, that such payments shall be reduced by the amount of any
disability income payments Executive receives during the Disability Period under
any policy carried by the Company of which Executive is the beneficiary. The
Company shall have the right to terminate this Agreement and Executive's
employment hereunder for a Disability at any time after the end of the
Disability Period. The Company shall pay Executive his Base Salary until the
date of termination (the date after the end of the Disability Period), plus any
Incentive Compensation earned through the date of termination and all unpaid
expense reimbursements as of such date.
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5.2 TERMINATION FOR CAUSE; EXECUTIVE'S RESIGNATION.
(a) CAUSE. The Company shall have the right to terminate Executive's
employment for Cause (as hereinafter defined) at any time, which termination
shall be effective immediately upon the Company giving notice to Executive
setting forth in reasonable detail the grounds therefore. For purposes of this
Agreement, any of the following actions or events shall constitute grounds for
termination of Executive's employment for "Cause":
(i) Executive's neglect or refusal to perform, or if he
otherwise fails to perform, his duties as an employee of the
Company, including, without limitation, any violation of the
policies referred to in Subsection 3.4 hereof or failure to
perform such duties as are delegated to him by the Board of
Directors;
(ii) any other conduct constituting a breach of this Agreement
or of any code of conduct heretofore or hereafter adopted by
the Company;
(iii) Executive's conviction (including a conviction on a nolo
contendere plea) of a felony or misdemeanor (other than minor
traffic offenses);
(iv) any willful, intentional, or grossly negligent act having
the effect of injuring Executive's reputation or the
reputation or business of the Company; or
(v) any other malfeasance, misfeasance or nonfeasance by
Executive relative to or in connection with the performance of
his duties hereunder (including, without limitation,
Executive's inability to perform his duties hereunder as a
result of chronic alcoholism or drug addiction).
(b) RESIGNATION. Executive shall have the right to terminate this
Agreement and his employment thereunder for any reason, other than Good Reason
(as defined in Section 5.3(b) hereof), upon thirty (30) days' prior written
notice to the Company.
(c) PAYMENT UPON TERMNIATION FOR CAUSE OR RESIGNATION. In the event
Executive is discharged for Cause or in the event Executive resigns (other than
pursuant to Section 5.3(b) hereof), the Company shall pay to Executive, within
forty-five (45) days after termination for Cause or resignation, his Base Salary
and any Incentive Compensation earned through the date of notice of termination
and all unpaid expense reimbursements as of such date. Executive hereby
acknowledges that upon termination of his employment for Cause or upon his
resignation, he shall have no right to receive any other payments or benefits
provided for under this Agreement.
5.3 TERMINATION WITHOUT CAUSE; GOOD REASON.
(a) WITHOUT CAUSE. The Company shall have the right to terminate
Executive's employment without Cause, other than for death or a Disability, at
any time upon fifteen (15) days' prior written notice thereof to Executive.
(b) GOOD REASON. Executive shall have the right to his employment
for Good Reason (as hereinafter defined), upon fifteen (15) days' prior written
notice thereof to the Company. As used herein, the term "Good Reason" shall mean
the occurrence of any of the following:
(i) the assignment to Executive, without his consent, of any
duties inconsistent in any substantial and negative respect
with his positions, duties, responsibilities and status with
the Company as contemplated hereunder, if not remedied by the
Company within thirty (30) days after receipt of written
notice thereof from Executive;
(ii) any removal of Executive, without his consent, from any
positions or offices Executive held as contemplated hereunder
(except in connection with the
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termination of Executive's employment by the Company for Cause
or on account of a Disability pursuant to the requirements of
this Agreement), if not remedied by the Company within thirty
(30) days after receipt of written notice thereof from
Executive;
(iii) any material breach by the Company of the terms of this
Agreement that is not remedied by the Company within thirty
(30) days after receipt of written notice thereof from
Executive; or
(iv) failure by any successor to the Company to expressly
assume all obligations of the Company under this Agreement,
which failure is not remedied by the Company within thirty
(30) days after receipt of written notice thereof from
Executive.
(c) PAYMENT UPON TERMINATION WITHOUT CAUSE OR FOR GOOD REASON. If
Executive's employment is terminated by the Company without Cause and other than
as a result of Executive's death or Disability, or by Executive for Good Reason,
then, and in any such event, the Company shall pay Executive, and Executive
shall accept as liquidated and agreed upon damages, an amount equal to the Base
Salary Executive would have earned for the remainder of the Initial Term or the
Extension Term, as applicable, which shall be paid periodically in accordance
with the Company's payroll policies, plus any Incentive Compensation earned
through the date of termination and all unpaid expense reimbursements as of such
date.
6. CONFIDENTIAL INFORMATION. Executive recognizes that he has and will continue
to have access to secret and confidential information regarding the Company or
ay of its subsidiaries or affiliated companies, including but not limited to
information relating sales, strategies, customers, formulas, processes, methods,
or ideas, belonging to or relating to the business of the Company or any of its
subsidiaries or affiliated companies (the "Confidential Information"). Executive
acknowledges that such Confidential Information is of great value to the
Company, is the sole property of the Company, and has been and will be acquired
by him in confidence. In consideration of the obligations undertaken by the
Company herein, Executive shall not at any time, during or after his employment
hereunder, reveal, divulge or make known to others or use to the detriment of
the Company, any such Confidential Information. The provisions of this Section 6
shall survive Executive's termination of employment hereunder.
7. COVENANTS AND RESTRICTIONS.
7.1 COMPETITION. Executive recognizes that the services to be performed by
him hereunder are special, unique and extraordinary. The parties confirm that it
is reasonably necessary for the protection of the Company that Executive agree,
and accordingly, Executive does hereby agree that, except as provided in Section
7.3 hereof, he shall not, directly or indirectly, at any time during the
Restricted Period within the Restricted Area (as such terms are defined in
Section 7.4 hereof), engage in any business which is competitive with the
business of the Company or any of its subsidiaries or affiliated companies,
either on his own behalf or as an officer, director, stockholder, partner,
principal, trustee, investor, consultant, associate, employee, owner, agent,
creditor, independent contractor, co-venturer of any other business, firm,
corporation, partnership or other entity or in any other relationship or
capacity.
7.2 SOLICITATION. Executive hereby agrees that he will not, directly or
indirectly, for or on behalf of himself or any other business, firm,
corporation, partnership or other entity, at any time during the Restricted
Period (i) solicit any past or present customer of the Company or any of its
subsidiaries or affiliated companies, or (ii) solicit, employ or engage, or
cause, encourage or authorize, directly or indirectly, to be employed or
engaged, for or on behalf of himself or any other business, firm, corporation,
partnership or other entity, any employee or agent of the Company or any of its
subsidiaries or affiliated companies.
7.3 EXCEPTIONS. This Section 7 shall not be construed to prevent Executive
from owning, directly and indirectly, in the aggregate, an amount not exceeding
4.9% of the issued and outstanding
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voting securities of any class of any corporation whose voting capital stock is
traded on a national securities exchange or in the over-the-counter market.
7.4 CERTAIN DEFINITIONS. The term "Restricted Period" as used in this
Section 7, shall mean the period of Executive's actual employment hereunder plus
twenty-four (24) months after the date Executive is no longer employed by the
Company. The term "Restricted Area" as used in this Section 7 shall mean
anywhere in the world.
7.5 SURVIVAL. The provisions of this Section 7 shall survive the
termination of Executive's employment hereunder.
8. REASONABLENESS OF COVENANTS. Executive acknowledges that he has carefully
read and considered all the terms and conditions of this Agreement, including
the restraints imposed upon him pursuant to Sections 6 and 7 hereof. Executive
agrees that said restraints are necessary for the reasonable and proper
protection of the Company and its subsidiaries and affiliates, and that each and
every one of the restraints is reasonable in respect to subject matter, length
of time, geographic area and otherwise. Executive further acknowledges that, in
the event any provision of Sections 6 and 7 hereof shall be determined by any
court of competent jurisdiction to be unenforceable by reason of its being
extended over too great a time, too large a geographic area, too great a range
of activities or any other reason, such provision shall be deemed to be modified
to permit its enforcement to the maximum extent permitted by law.
9. INSURANCE. The Company may, from time to time, apply for, purchase and
maintain, in its own name and at its own expense, life, health, accident,
disability or other insurance upon Executive in any sum or sums that it may deem
necessary to protect its interests, and Executive agrees to aid and cooperate in
all reasonable respects with the Company in procuring any and all such
insurance, including, without limitation, submitting to the usual and customary
medical examinations, and by filling out, executing and delivering such
applications and other instruments in writing as may be reasonably required by
an insurance company or companies to which an application or applications for
such insurance may be made by or for the Company. In order to induce the Company
to enter into this Agreement, Executive represents and warrants to the Company
that to the best of his knowledge Executive is insurable at standard (non-rated)
premiums.
10. MISCELLANEOUS.
10.1 ENFORCEMENT OF COVENANTS. The parties hereto agree that Executive is
obligated under this Agreement to render personal services during the Term of a
special, unique, unusual, extraordinary and intellectual character, thereby
giving this Agreement peculiar value, and in the event of a breach of any
provision of this Agreement by Executive, the injury or imminent injury to the
value and goodwill of the Company's business could not be reasonably or
adequately compensated in damages in an action at law. Executive therefore
agrees that the Company, in addition to any other remedies available to it,
shall be entitled to seek specific performance, preliminary and permanent
injunctive relief or any other equitable remedy against Executive, without the
posting of a bond, in the event of any breach or threatened breach by Executive
of any provision of this Agreement, including, but not limited to, the
provisions of Sections 6 and 7 hereof. Without limiting the generality of the
foregoing, if Executive breaches any provision of Sections 6 and 7 hereof, such
breach will entitle the Company to enjoin Executive from disclosing any
Confidential Information to any competing business, to enjoin such competing
business from receiving or using any Confidential Information, and/or to enjoin
Executive from rendering personal services to or in connection with such
competing business. The rights and remedies of the parties hereto are cumulative
and shall not be exclusive, and each party shall be entitled to pursue all legal
and equitable rights and remedies and to secure performance of the obligations
and duties of the other under this Agreement, and the enforcement of one or more
of such rights and remedies by a party shall in no way preclude such party from
pursuing, at the same time or subsequently, any and all other rights and
remedies available to it.
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10.2 SEVERABILITY. The invalidity or partial invalidity of one or more
provisions of this Agreement shall not invalidate any other provision of this
Agreement. If any portion or provision of this Agreement shall to any extent be
declared illegal or unenforceable by a court of competent jurisdiction, the
remainder of this Agreement, or the application of such portion or provision in
circumstances other than those as to which it is so declared illegal or
unenforceable, shall not be affected thereby, and each portion and provision of
this Agreement shall be valid and enforceable to the fullest extent permitted by
law.
10.3 ASSIGNMENTS. Neither Executive nor the Company may assign or delegate
any of their rights or duties under this Agreement without the express written
consent of the other, except the Company may transfer its rights and duties in
connection with a sale of all or substantially all of its assets or in
connection with any merger, consolidation or other similar business combination.
10.4 ENTIRE AGREEMENT; AMENDMENT. This Agreement constitutes and embodies
the full and complete understanding and agreement of the parties with respect to
Executive's employment by the Company, supersedes all prior understandings and
agreements, whether oral or written, between Executive and the Company, and
shall not be amended, modified or changed except by an instrument in writing
executed by Executive and by an expressly authorized officer of the Company.
10.5 WAIVER. No waiver of any provision hereof shall be effective unless
made in writing and signed by the waiving party. The failure of either party to
require the performance of any term or obligation of this Agreement, or the
waiver by either party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.
10.6 BINDING EFFECT. This Agreement shall inure to the benefit of, be
binding upon and enforceable against, the parties hereto and their respective
successors, heirs, beneficiaries and permitted assigns.
10.7 HEADING. The headings contained in this Agreement are for convenience
of reference only and shall not affect in any way the meaning or interpretation
of this Agreement.
10.8 NOTICES. Any and all notices, requests, demands and other
communications required or permitted to be given hereunder shall be in writing
and shall be deemed to have been duly given when personally delivered, sent by
registered or certified mail, return receipt requested, postage prepaid, or by
private overnight mail service (e.g., Federal Express) to the party at the
address set forth above or to such other address as either party may hereafter
give notice of in accordance with the provisions hereof. Notices shall be deemed
given on the sooner of the date actually received or the third business day
after sending.
10.9 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the law of the State of Georgia, without giving effect to such
State's conflicts of laws principles.
10.10 COUNTERPARTS. This Agreement may be executed simultaneously in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
10.11 CONSTRUCTION. The language used in this Agreement is the language
chosen by the parties to express their mutual intent, and no rule of strict
construction will be applied against either party.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date set forth above.
AMERIFIRST CAPITAL CORP.
By:
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Name:
Title:
EXECUTIVE
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Xxxx Xxxxx
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