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Exhibit 10.5
EMPLOYMENT AGREEMENT
This Employment Agreement (the Agreement) is made as of this 22nd day of
September, 1999 by and among Summit Brokerage Services, Inc., (the Company) and
any successor company currently at 00 Xxxxx Xxxxxx, Xxxxxxxxxxx, XX. 00000 and
Xxxxxxx X. Xxxxxx (Xxxxxx) currently having an address at 00000 Xxxxxx Xx.,
Xxxxx, XX 00000.
WITNESSETH
WHEREAS, the Company and Xxxxxx wish to set forth the terms and conditions
upon which Xxxxxx shall hereinafter be employed by the Company.
NOW, THEREFORE, IN consideration of the mutual covenants and agreements set
forth herein and for other goods and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Term. Xxxxxx shall be employed by the Company commencing on the above
date hereof and terminating two years from such date, unless sooner
terminated in accordance with the terms of this agreement (such period
referred to as the Term). There will be two consecutive optional one
year terms. Each optional year will need the approval of the Company
and Xxxxxx. This Agreement is conditioned upon the change of control
of Summit Brokerage Services, Inc.
2. Positions. During the Term, Xxxxxx shall serve as the President and
Chief Operating Officer of Summit Brokerage Services, Inc. and shall
perform such duties as shall be delegated to him by the Chief
Executive Officer and the Board of Directors of that company. Xxxxxx
will be responsible for all day to day operations of the securities
broker-dealer, all insurance activities inclusive of any separate
corporate agencies and registered investment advisors. Any
interference with Xxxxxx in carrying out such duties by any other
employee or officer or Board member or combination thereof who/
which knowingly may cause Xxxxxx or the Company to in any way to
violate any securities, insurance or investment advisory regulations,
rules or laws shall be a breach of this contract and shall cause
immediate payment of any and all compensation and stock options to
Xxxxxx. After such payment, Xxxxxx shall render a written resignation
resigning all positions with any and all affiliated companies of
Summit Brokerage Services, Inc. or its successors.
3. Compensation. Turnover shall receive an initial annual salary of
$100,000 of which $1,667 per month shall be deferred until the last
month of the first quarter of the year 2000 at which time a payment
will be made to Xxxxxx for $11,669; 15,000 shares of company stock
for year one and 15,000 shares of
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stock for year two. This salary will be increased in the second year
by five percent (5%) and each year thereafter for each additional
year. Xxxxxx shall receive prerequisites as may be directed by the
Board of Directors but shall be no less than three weeks vacation in
year one and four weeks vacation in year two (any vacation time
remaining at the end of each year shall be paid to Xxxxxx at 1 1/2
times its value) health and life insurance coverage for Xxxxxx and his
spouse and a $200/month car allowance.
4. Expenses. During the Term, Xxxxxx shall be entitled to prompt
reimbursement of all business expenses in accordance with the
Company's policy for such reimbursement. In the event of relocation
the company will pay all such relocation expenses inclusive of any
realtor's fees in the sale of Xxxxxx'x current residence plus all
closing costs on the purchase of a new residence. Additionally all
interim housing expenses between such relocation and the location in a
new residence.
5. Stock Options. On the date hereof the Company grants to Xxxxxx 100,000
options (50,000 options each year of the term). Each year of
employment thereafter Xxxxxx will be entitled to an additional 50,000
options exercisable for shares of the Company's common stock. The
exercise price for all options shall be $2.50. Exercise of the options
may be done on a cashless basis through the company or through any
securities broker dealer.
6. Vesting of Options. The above options shall vest as granted. Should a
change of control of the Company take place during the term, all
options will automatically be 100% vested and thereby exercisable. The
expiration date of each option shall be one year after the end of the
Term or after Xxxxxx'x last year of employment with the firm.
7. Change of Control. In the event Xxxxxx is terminated in connection
with a "change in control" of the Company, Xxxxxx shall receive a lump
sum payment equal to one year of his compensation at the annual rate
inclusive of all increases through the end of the Term and options
which were granted in previous years and the current year as described
in #6 above. A change in control shall mean any sale, merger, transfer
stock exchange or acquisition of the Company, in which Xxxxxx'x
position is terminated or changed.
8. Benefit Plans. Xxxxxx shall be entitled to participate in the
Company's benefit plans in the same manner and subject to the same
terms and conditions as the other senior executives of the company.
9. Termination. (A) The Company may terminate this Agreement at any time
for "Cause." For purposes of this Agreement, "Cause" shall mean the
following (i) if Xxxxxx has persistently and will fully failed to
devote substantially all of his working time to the operations of the
Company, after specific notice has been given to Xxxxxx of such
alleged failure and a 20 day
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opportunity has been given but nothing has been accomplished to cure
such failure (ii) if Xxxxxx is indicted of any criminal offense
involving a violation of any federal or state securities laws,
embezzlement, fraud, wrongful taking of property involving the Company
or any subsidiary or its customers. All options and bonuses if payable
will be placed in escrow and be null and void if convicted (iii)
violation or breach of this Agreement not corrected within 20 days
after notice of same.
(a) In the event this Agreement shall be terminated by the
Company for any reason other than pursuant to Section 9(a),
Xxxxxx shall be entitled to receive all payments and benefits
to which he was entitled pursuant to this Agreement to the
end of the term or one year whichever is shorter.
(b) Should Xxxxxx be terminated as per (a) above, he agrees to
not compete with or be engaged in the same business as the
Company for the remainder of the Term with the exception that
he will be allowed to become registered with a securities
firm and be insurance licensed as per regulatory requirements.
(c) For a period of three years following termination from the
Company Xxxxxx will not recruit or allow to join a firm
Xxxxxx is associated with any employees or Independent
Contractors from the Company.
10. Authority; No Conflict. Xxxxxx and the Company each represent and
warrant that (A) each has the full power and authority to enter into
this Agreement and to perform each of their obligations hereunder, and
(B) the execution, delivery and performance by Xxxxxx and the Company
of this Agreement will neither (i) violate conflict with, or result in
any breach of any contract or other Agreement by Xxxxxx or the Company
nor (ii) violate any law, statute, or other requirement of any
government body.
11. Miscellaneous. This Agreement (i) contains the entire understanding of
the parties with respect to the subject matter hereof and supercedes
all prior agreements of the parties, written or oral, of any nature
whatsoever, (ii) shall be binding upon and shall inure to the benefit
of the parties hereto and their respective successors and (iii) shall
be governed by the laws of the state of Florida, without giving effect
to the conflicts of law provisions thereof.
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12. Mediation/Arbitration. Any dispute or controversy arising out of or
relating to this Agreement, any Document or instrument delivered
pursuant to, in connection with, or simultaneously with this Agreement,
or any breach of this Agreement or any breach of this Agreement or any
such document or instrument shall be heard first through Mediation. If
no settlement is reached through the Mediation process then each party
agrees to Arbitration to be held and decided in accordance with the
Code of Arbitration of the National Association of Securities Dealers,
Inc. The cost and expenses for the arbitration shall be paid by each of
the parties.
IN WITNESS THEREOF, THE PARTIES HERETO HAVE CAUSED THIS AGREEMENT TO BE DULY
EXECUTED AND DELIVERED AS OF THE DATE FIRST WRITTEN ABOVE.
AGREED /s/ XXXXXXX X. XXXXXX
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XXXXXXX X. XXXXXX, CHAIRMAN BOARD OF DIRECTORS
SUMMIT BROKERAGE SERVICES, INC. AND ALL AFFILIATES
AGREED /s/ XXXXXXX X. XXXXXX
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XXXXXXX X. XXXXXX
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ADDENDUM TO EMPLOYMENT AGREEMENT
This addendum is made as of this 16th day of May, 2000 to the Employment
Agreement between Summit Brokerage Services, Inc. (the Company) and Xxxxxxx X.
Xxxxxx, (Xxxxxx) dated September 22nd, 1999.
The parties agree to the following changes:
3. Compensation. Effective January 1st 2000 through the remaining term of
the agreement, Xxxxxx shall forego his rights to receive 15,000 shares
of company stock per year, in exchange for the change made to paragraph
5 below.
5. Stock Options. Effective January 1st 2000 through the remaining term of
the agreement Xxxxxx shall forego his rights to receive 100,000 options
(50,000 options each year of the term.)
On the date hereof, the Company grants to Xxxxxx 160,000 options exercisable for
shares of the Company's common stock. The exercise price for all options shall
be $2.50.
All other terms and conditions remain the same.
Agreed to and accepted this 16th day of May, 2000.
Xxxxxxx Brokerage Services, Inc.
/s/ Xxxxxxx Xxxxxx, /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx Xxxxxx, Xxxxxxx X. Xxxxxx
Chairman and CEO
/s/ Xxxx Xxxxxxxxx /s/ Xxxx Xxxxxxxxx
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Witness Witness
