Exhibit 10.18
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "AGREEMENT") is made as of this 1st day
of March, 2000, by and between Xxxxxx.xxx, Inc., a Delaware corporation (the
"COMPANY"), and Xxxxxxxx X. XxXxxxxxx (the "EXECUTIVE").
RECITALS:
A. The Company is actively engaged in operating an e-commerce site
(Xxxxxx.xxx) which facilitates both the purchase and sending of liquor, wine,
and other alcoholic or non-alcholic beverage by businesses and individuals for
gift delivery and personal consumption.
B. The Company is currently expanding its business by further utilizing
its existing network of affiliates in the alcholic beverage industry to reduce
the cost and increase the efficiency at each tier of the alcholic beverage
distribution system.
C. The Company desires to employ Executive and the Executive desires to
be employed by the Company.
D. As a condition of the Company entering into this Agreement with the
Executive, Executive has agreed to execute and deliver the
Confidentiality/Invention and Non-Compete Agreement attached hereto as EXHIBIT A
(the "CONFIDENTIALITY AGREEMENT").
NOW, THEREFORE, in consideration of the foregoing and the agreements,
covenants and conditions set forth herein, the Executive and the Company hereby
agree as follows:
ARTICLE I
EMPLOYMENT
1.1 EMPLOYMENT. The Company hereby employs, engages and hires
Executive, and Executive hereby accepts employment, upon the terms and
conditions set forth in this Agreement. The Executive shall serve as an
Executive Vice President of Business Development. Executive shall have and fully
perform such duties and responsibilities that may be, from time to time,
assigned to him by the Company.
1.2 ACTIVITIES AND DUTIES DURING EMPLOYMENT. Executive represents and
warrants to the Company that he is free to accept employment with the Company,
and that he has no prior or other commitments or obligations of any kind to
anyone else which would hinder or interfere with his acceptance of his
obligations under this Agreement, or the exercise of his best efforts as an
officer and employee of the Company. During the Employment Term (as defined
below), Executive agrees:
(a) to devote substantially all of his business, time, attention
and efforts to the faithful and diligent performance of his services to
the Company;
(b) to faithfully serve and further the interests of the Company in
every lawful way, giving honest, diligent, loyal and cooperative
service to the Company; and
(c) to comply with all rules and policies which, from time to time,
may be adopted by the Company.
ARTICLE II
TERM
2.1 TERM. The term of employment under this Agreement shall be one (1)
year (the "INITIAL TERM"), commencing on the date of the Agreement (such term of
employment, as it may be extended or terminated, is herein referred to as the
"EMPLOYMENT TERM"), which Employment Term shall automatically renew for one year
periods unless terminated by either party by written notice not less than sixty
(60) days prior to expiration of the then-current term.
2.2 TERMINATION. The employment of Executive may be terminated as
follows:
(a) By the Company at any time without cause by providing Executive
with written notice of termination. If the Company terminates
Executive's employment hereunder without cause, the Company shall be
obligated to pay Executive's pro-rated base salary only through the
actual effective date of termination. In addition, if Executive
executes a separation agreement including a general release and a
reaffirmation of certain covenants in the Confidentiality Agreement in
a form acceptable to the Company, the Company shall pay to Executive,
in one lump sum, an amount equal to six (6) months of Executive's base
salary.
(b) By the Company immediately for "CAUSE." For the purpose of this
Agreement, "CAUSE" shall mean (i) conduct amounting to fraud,
embezzlement, gross negligence, or willful or illegal misconduct in
connection with Executive's duties under this Agreement; (ii) any act
of dishonesty in connection with the Executive's duties under this
Agreement; (iii) the indictment or conviction of Executive by a court
of proper jurisdiction of (or his written, voluntary and freely given
confession to) a crime which constitutes a felony and/or results in
injury to the Company's property, operation or reputation; (iv) any
failure by the Executive to perform or observe any duty assigned to
Executive hereunder or the breach of any term under this Agreement,
which default has continued for a period of five (5) business days
after written notice thereof from the Company to the Executive,
provided that no notice or cure period shall be required after the
first such offense by Executive; or (v) breach of any term of the
Confidentiality Agreement, except for an unintentional breach that
Executive cures within five (5) business days after written notice
thereof from the Company to the Executive. If the Company terminates
Executive's employment for Cause hereunder, Company shall be obligated
to pay Executive's pro-rated base salary only through the actual
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effective date of termination and shall have no other payment
obligation or liability to Executive under this Agreement or otherwise.
(c) Upon the death of Executive, and in such event, the Company
shall be obligated to Executive's family or estate only for the
pro-rated salary and accrued bonus as of the date of Executive's death.
(d) By either party upon the Total Disability of the Executive. The
Executive shall be considered to have a Total Disability for purposes
of this Agreement if he is unable by reason of accident or illness to
substantially perform his employment duties, and is expected to be in
such condition for periods totaling three (3) months (whether or not
consecutive) during any consecutive period of twelve (12) months.
During a period of disability prior to termination hereunder, Executive
shall continue to receive his base salary. If either party terminates
Executive's employment upon a Total Disability of the Executive, the
Company shall be obligated to pay Executive's pro-rated base salary and
accrued bonus, if any, only through the actual effective date of
termination.
2.3 CESSATION OF RIGHTS AND OBLIGATIONS: SURVIVAL OF CERTAIN
PROVISIONS. On the date of expiration or earlier termination of the Employment
Term for any reason, all of the respective rights, duties, obligations and
covenants of the parties, as set forth herein, shall, except as specifically
provided herein to the contrary, cease and become of no further force or effect
as of the date of said termination, and shall only survive as expressly provided
for herein.
2.4 CESSATION OF COMPENSATION. Upon any termination of the Employment
Term, Executive shall be entitled to receive the compensation set forth above in
SECTION 2.2 and expense reimbursement through the date of termination; PROVIDED,
HOWEVER, that any compensation or expense reimbursement payable to Executive
shall be subject to any set-offs to which the Company may be entitled. Unless
specifically required to be paid by law, other compensation and benefits,
including accrued vacation time, will not be paid or provided after termination
for any reason.
ARTICLE III
COMPENSATION OF BENEFITS
3.1 COMPENSATION.
(a) During the Employment Term, the Company shall pay Executive a
base salary ("BASE SALARY") of One Hundred Fifty Thousand Dollars
($150,000) per year. The Base Salary will be reviewed annually by the
Board of Directors with a view to increasing it.
(b) The Company shall, in addition to Executive's Base Salary,
pay Executive an annual performance bonus (the "PERFORMANCE BONUS")
based on the Company obtaining certain targeted financial goals, as
established by the Board of Directors of the Company.
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3.2 PAYMENT. All compensation shall be payable in intervals in
accordance with the general payroll payment practice of the Company. The
compensation shall be subject to such withholdings and deductions by the Company
as are required by law.
3.3 OPTIONS. The Company shall grant to the Executive incentive stock
options to purchase 50,000 shares of the Company's common stock at an exercise
price equal to $3.52 per share and such other terms and conditions set forth in
the Company's 2000 Stock Plan and the option agreement issued thereunder. The
option shares shall vest as follows: 20,000 shares upon issuance and 2,000
shares each month thereafter until fully vested.
3.4 BUSINESS EXPENSES.
(a) REIMBURSEMENT. The Company shall reimburse the Executive for
all reasonable, ordinary, and necessary business expenses incurred by
him in connection with the performance of his duties hereunder,
including, but not limited to, ordinary and necessary travel expenses
and entertainment expenses.
(b) ACCOUNTING. The Executive shall provide the Company with an
accounting of his expenses, which accounting shall clearly reflect
which expenses are reimbursable by the Company. The Executive shall
provide the Company with such other supporting documentation and other
substantiation of reimbursable expenses as will conform to Internal
Revenue Service or other requirements. All such reimbursements shall be
payable by the Company to the Executive within a reasonable time after
receipt by the Company of appropriate documentation therefor.
3.5 OTHER BENEFITS. Executive shall be entitled to participate in any
retirement, pension, profit-sharing, stock option, health plan, incentive
compensation and welfare or any other benefit plan or plans of the Company which
may now or hereafter be in effect for executive officers of the Company. The
Executive shall be entitled to two weeks paid vacation.
ARTICLE IV
MISCELLANEOUS
4.1 NOTICES. All notices or other communications required or permitted
hereunder shall be in writing and shall be deemed given, delivered and received
(a) when delivered, if delivered personally, (b) four days after mailing, when
sent by registered or certified mail, return receipt requested and postage
prepaid, (c) one business day after delivery to a private courier service, when
delivered to a private courier service providing documented overnight service,
and (d) on the date of delivery if delivered by telecopy, receipt confirmed,
provided that a confirmation copy is sent on the next business day by first
class mail, postage prepaid, in each case addressed as follows:
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To Executive at his home address.
To Company at: Xxxxxx.xxx, Inc.
0000 X. Xxxxxx Xxxx Xxxx
Xxxxxxx, XX 00000
Attn: Chief Executive Officer
Ph: 000-000-0000
Fax: 000-000-0000
With a copy to: Xxxxxxx & Xxxxxxxx Ltd.
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx
Any party may change its address for purposes of this paragraph by giving the
other party written notice of the new address in the manner set forth above.
4.2 ENTIRE AGREEMENT; AMENDMENTS, ETC. This Agreement and the
Confidentiality Agreement, and the option plan and agreements referred to herein
contain the entire agreement and understanding of the parties hereto, and
supersedes all prior agreements and understandings relating to the subject
matter thereof. No modification, amendment, waiver or alteration of this
Agreement or any provision or term hereof shall in any event be effective unless
the same shall be in writing, executed by both parties hereto, and any waiver so
given shall be effective only in the specific instance and for the specific
purpose for which given.
4.3 BENEFIT. This Agreement shall be binding upon, and inure to the
benefit of, and shall be enforceable by, the heirs, successors, legal
representatives and permitted assignees of Executive and the successors,
assignees and transferees of the Company. This Agreement or any right or
interest hereunder may not be assigned by Executive without the prior written
consent of the Company.
4.4 NO WAIVER. No failure or delay on the part of any party hereto in
exercising any right, power or remedy hereunder or pursuant hereto shall operate
as a waiver thereof; nor shall any single or partial exercise of any such right,
power or remedy preclude any other or further exercise thereof or the exercise
of any other right, power or remedy hereunder or pursuant thereto.
4.5 SEVERABILITY. Wherever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law but, if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement. If any part of any
covenant or other provision in this Agreement is determined by a court of law to
be overly broad thereby making the covenant unenforceable, the parties hereto
agree, and it is their desire, that the court shall substitute
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a judicially enforceable limitation in its place, and that as so modified the
covenant shall be binding upon the parties as if originally set forth herein.
4.6 COMPLIANCE AND HEADINGS. Time is of the essence of this Agreement.
The headings in this Agreement are intended to be for convenience and reference
only, and shall not define or limit the scope, extent or intent or otherwise
affect the meaning of any portion hereof.
4.7 GOVERNING LAW. The parties agree that this Agreement shall be
governed by, interpreted and construed in accordance with the laws of the State
of Illinois, and the parties agree that any suit, action or proceeding with
respect to this Agreement shall be brought in the courts of Xxxx County in the
State of Illinois or in the U.S. District Court for the Northern District of
Illinois. The parties hereto hereby accept the exclusive jurisdiction of those
courts for the purpose of any such suit, action or proceeding. Venue for any
such action, in addition to any other venue permitted by statute, will be Xxxx
County, Illinois.
4.8 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed an original and all of which together
will constitute one and the same instrument.
4.9 RECITALS. The Recitals set forth above are hereby incorporated in
and made a part of this Agreement by this reference.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed and delivered as of the day and year first above
written.
XXXXXX.XXX, INC.,
a Delaware corporation
By: /s/ Xxxxx Xxxxxx
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Xxxxx Xxxxxx
Chief Executive Officer
EXECUTIVE:
/s/ Xxxxxxxx X. XxXxxxxxx
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Xxxxxxxx X. XxXxxxxxx
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