1
Exhibit 10.4
Employment Agreement Dated as of March 6, 2000 between Xxxxx X. Xxxxxxx and
Xxxxx Enterprises, Incorporated.
EMPLOYMENT AGREEMENT
PLEASE READ THIS AGREEMENT CAREFULLY. THIS AGREEMENT DESCRIBES THE BASIC LEGAL
AND ETHICAL RESPONSIBILITIES THAT YOU ARE REQUIRED TO OBSERVE AS AN EXECUTIVE
EXPOSED TO HIGHLY SENSITIVE TECHNOLOGY AND STRATEGIC INFORMATION. CONSULT WITH
YOUR LEGAL COUNSEL IF ALL THE TERMS AND PROVISIONS OF THIS AGREEMENT ARE NOT
FULLY UNDERSTOOD BY YOU.
THIS AGREEMENT is made as of the 1st day of March, 2000, by and
between XXXXX ENTERPRISES, INCORPORATED, a Florida corporation (the "Company"),
and XXXXX X. XXXXXXX (the "Executive").
W I T N E S S E T H :
WHEREAS, the Company desires to assure itself of the Executive's
continued employment in an executive capacity; and
WHEREAS, the Executive desires to be employed by the Company on the
terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements of the parties contained herein, and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto covenant and agree as follows:
1. EMPLOYMENT AND DUTIES. Subject to the terms and conditions of
this Agreement, the Company shall employ the Executive during the Term (as
hereinafter defined) in such management capacities as may be assigned from time
to time by the Company. The Executive accepts such employment and agrees to
devote his best efforts and entire business time, skill, labor, and attention
to the performance of such duties. The Executive agrees to promptly provide a
description of any other commercial duties or pursuits engaged in by the
Executive to the Company's Board of Directors. If the Board of Directors
determines in good faith that such activities conflict with the Executive's
performance of his duties hereunder, the Executive shall promptly cease such
activities to the extent as directed by the Board of Directors. It is
acknowledged and agreed that such description shall be made regarding any such
activities in which the Executive owns more than 5% of the ownership of the
organization or which may be in violation of Section 5 hereof, and that the
failure of the Executive to provide any such description shall enable the
Company to terminate the Executive for Cause (as provided in Section 6(c)
hereof). The Company agrees to hold any such information provided by the
Executive confidential and not disclose the same to any person other than a
person to whom disclosure is reasonably necessary or appropriate in light of
the circumstances. In addition, the Executive agrees to serve without
additional compensation if elected or appointed to any office or position,
including as a director, of the Company or any subsidiary or affiliate of the
Company; provided, however, that the Executive shall be entitled to receive
such benefits and additional compensation, if any, that is paid to executive
officers of the Company in connection with such service.
2. TERM. Subject to the terms and conditions of this Agreement,
including, but not limited to, the provisions for termination set forth in
Section 6 hereof, the employment of the Executive under this Agreement shall
commence on the effective date hereof and shall continue through and including
the close of business on the date hereof as set forth on Exhibit A attached
hereto and incorporated herein (such term shall herein be defined as the
"Term"). The Executive agrees that some portions of this Agreement, including
Sections 4, 5, and 6 hereof, will remain in force after the termination of this
Agreement.
3. COMPENSATION.
(a) Base Salary and Bonus. As compensation for the
Executive's services under this Agreement, the Executive shall receive and the
Company shall pay a weekly base salary set forth on Exhibit A. Such base salary
may be increased but not decreased during the Term in the Company's discretion
based upon the Executive's performance and any other factors the Company deems
relevant. Such base salary shall be payable in accordance with the policy then
prevailing for the Company's executives. In addition to such base salary, the
Executive shall be entitled during the Term to a performance bonus set forth on
Exhibit A and to participate in and receive payments from, at the Company's
election, other bonus and other incentive compensation plans, if any, as may be
adopted by the Company.
(b) Payments. All amounts paid pursuant to this
Agreement shall be subject to withholding or deduction by reason of the Federal
Insurance Contribution Act, federal income tax, state and local income tax, if
any, and comparable laws and regulations.
(c) Other Benefits. The Executive shall be reimbursed by
the Company for all reasonable and customary travel and other business expenses
incurred by the Executive in the performance of the Executive's duties
hereunder in accordance with the Company's standard policy regarding expense
verification practices. The Executive shall be entitled to that number of weeks
paid vacation per year that is available to other executive officers of the
Company in accordance with the Company's standard policy regarding vacations
and such other fringe benefits as may be set forth on Exhibit A and shall be
eligible to participate in such pension, life insurance, health insurance,
disability insurance, and other executive benefits plans, if any, which the
Company may from time to time make available to its executive officers
generally.
2
4. CONFIDENTIAL INFORMATION.
(a) The Executive has acquired and will acquire information
and knowledge respecting the intimate and confidential affairs of the Company,
including, without limitation, confidential information with respect to the
Company's technical data, research and development projects, methods, products,
software, financial data, business plans, financial plans, customer lists,
business methodology, processes, production methods and techniques, promotional
materials and information, and other similar matters treated by the Company as
confidential (the "Confidential Information"). Accordingly, the Executive
covenants and agrees that during the Executive's employment by the Company
(whether during the Term hereof or otherwise) and thereafter, the Executive
shall not, without the prior written consent of the Company, disclose to any
person, other than a person to whom disclosure is reasonably necessary or
appropriate in connection with the performance by the Executive of the
Executive's duties hereunder, any Confidential Information obtained by the
Executive while in the employ of the Company.
(b) The Executive agrees that all memoranda; notes; records;
papers or other documents; computer disks; computer, video or audio tapes;
CD-ROMs; all other media and all copies thereof relating to the Company's
operations or business, some of which may be prepared by the Executive; and all
objects associated therewith in any way obtained by the Executive shall be the
Company's property. This shall include, but is not limited to, documents;
computer disks; computer, video and audio tapes; CD-ROMs; all other media and
objects concerning any technical data, methods, products, software, research
and development projects, financial data, financial plans, business plans,
customer lists, contracts, price lists, manuals, mailing lists, advertising
materials; and all other materials and records of any kind that may be in the
Executive's possession or under the Executive's control. The Executive shall
not, except for the Company's use, copy or duplicate any of the aforementioned
documents or objects, nor remove them from the Company's facilities, nor use
any information concerning them except for the Company's benefit, either during
the Executive's employment or thereafter. The Executive covenants and agrees
that the Executive will deliver all of the aforementioned documents and
objects, if any, that may be in the Executive's possession to the Company upon
termination of the Executive's employment, or at any other time at the
Company's request.
(c) In any action to enforce or challenge these Confidential
Information provisions, the prevailing party is entitled to recover its
attorney's fees and costs.
5. COVENANT NOT-TO-COMPETE AND NO SOLICITATION. Executive
recognizes that the Company is in the business of employing individuals to
provide specialized and technical services to the Company's Clients. The
purpose of these Covenant Not-to-Compete and No Solicitation provisions are to
protect the relationship which exists between the Company and its Client while
Executive is employed and after Executive leaves the employ of the Company. The
consideration for these Covenant Not-to-Compete and No Solicitation provisions
is the Executive's employment with the Company.
(a) Executive acknowledges the following:
(1) The Company expended considerable resources in
obtaining contracts with its Clients;
(2) The Company expended considerable resources to
recruit and hire employees who could perform
services for its Clients;
(3) Through his/her employ with the Company,
Executive will develop a substantial
relationship with the Company's existing or
potential Clients, including, but not limited
to, being the sole or primary contact between
the Client and the Company;
(4) Executive will be exposed to valuable
confidential business information about the
Company, its Clients, and the Company's
relationship with its Client;
(5) By providing services on behalf of the Company,
Executive will develop and enhance the valuable
business relationship between the Company and
its Client;
(6) The relationship between the Company and its
Clients depends on the quality and quantity of
the services Executive performs;
(7) Through employment with the Company, Executive
will increase his/her opportunity to work
directly for the Clients or for a competitor of
the Company; and
(8) The Company will suffer irreparable harm if
Executive breaches these Covenant Not-to-Compete
and No Solicitation provisions of this
Agreement.
3
(b) Executive agrees that:
(1) The relationship between the Company and its
Client (developed and enhanced when the
Executive performs services on behalf of the
Company) is a legitimate business interest for
the Company to protect;
(2) The Company's legitimate business interest is
protected by the existence and enforcement of
these Covenant Not-to-Compete and No
Solicitation provisions;
(3) The business relationship which is created or
exists between the Company and its Client, or
the goodwill resulting from it, is a business
asset of the Company and not the Executive; and
(4) Executive will not seek to take advantage of
opportunities which result from his/her
employment with the Company and that entering
into the Agreement containing Covenant
Not-to-Compete and No Solicitation provisions is
reasonable to protect the Company's business
relationship with its Clients.
(c) Restrictions on Executive. During the term of this
Agreement and for a period of time set forth on Exhibit A after the termination
of this Agreement, for whatever reason, whether such termination was by the
Company or the Executive, voluntarily or involuntarily, and whether with or
without cause, Executive agrees that he/she shall not, as a principal,
employer, stockholder, partner, agent, consultant, independent contractor,
employee, or in any other individual or representative capacity:
(1) Directly or indirectly engage in, continue in,
or carry on the business of the Company or any
business substantially similar thereto,
including owning or controlling any financial
interest in any corporation, partnership, firm,
or other form of business organization which
competes with or is engaged in or carries on any
aspect of such business or any business
substantially similar thereto;
(2) Consult with, advise, or assist in any way,
whether or not for consideration, any
corporation, partnership, firm, or other
business organization which is now, becomes, or
may become a competitor of the Company in any
aspect of the Company's business during the
Executive's employment with the Company,
including, but not limited to, advertising or
otherwise endorsing the products of any such
competitor or loaning money or rendering any
other form of financial assistance to or
engaging in any form of transaction whether or
not on an arm's length basis with any such
competitor;
(3) Provide or attempt to provide or solicit the
opportunity to provide or advise others of the
opportunity to provide any services of the type
Executive performed for the Company or the
Company's Clients (regardless of whether and how
such services are to be compensated, whether on
a salaried, time and materials, contingent
compensation, or other basis) to or for the
benefit of any Client (i) to which Executive has
provided services in any capacity on behalf of
the Company, or (ii) to which Executive has been
introduced to or about which the Executive has
received information through the Company or
through any Client from which Executive has
performed services in any capacity on behalf of
the Company;
(4) Retain or attempt to retain, directly or
indirectly, for itself or any other party, the
services of any person, including any of the
Company's employees, who were providing services
to or on behalf of the Company while Executive
was employed by the Company and to whom
Executive has been introduced or about whom
Executive has received information through
Employer or through any Client for which
Executive has performed services in any capacity
on behalf of the Company;
(5) Engage in any practice, the purpose of which is
to evade the provisions of this Agreement or to
commit any act which is detrimental to the
successful continuation of or which adversely
affects the business or the Company; provided,
however, that the foregoing shall not preclude
the Executive's ownership of not more than 2% of
the equity securities registered under Section
12 of the Securities Exchange Act of 1934, as
amended; or
(6) For purpose of these Covenant Not-to-Compete and
No Solicitation provisions, Client includes any
subsidiaries, affiliates, customers, and clients
of the Company's Clients. The Executive agrees
that the geographic scope of this Covenant
Not-to-Compete shall extend to the geographic
area where the Company's Clients conduct
business at any time during the Term of this
Agreement. For purposes of this Agreement,
"Clients" means any person or entity to which
the Company provides or has provided within a
period of one (1) year prior to the Executive's
termination of employment labor, materials or
services for the furtherance of such entity's or
person's business or any person or entity that
within such period of one (1) year the Company
has pursued or communicated with for the purpose
of obtaining business for the Company.
4
(d) Enforcement. These Covenant Not-to-Compete and
No Solicitation provisions shall be construed
and enforced under the laws of the State of
Florida. In the event of any breach of this
Covenant Not-to-Compete, the Executive
recognizes that the remedies at law will be
inadequate, and that in addition to any relief
at law which may be available to the Company for
such violation or breach and regardless of any
other provision contained in this Agreement, the
Company shall be entitled to equitable remedies
(including an injunction) and such other relief
as a court may grant after considering the
intent of this Section 5. It is further
acknowledged and agreed that the existence of
any claim or cause of action on the part of the
Executive against the Company, whether arising
from this Agreement or otherwise, shall in no
way constitute a defense to the enforcement of
this Covenant Not-to-Compete, and the duration
of this Covenant Not-to-Compete shall be
extended in an amount which equals the time
period during which the Executive is or has been
in violation of this Covenant Not-to-Compete. In
the event a court of competent jurisdiction
determines that the provisions of this Covenant
Not-to-Compete are excessively broad as to
duration, geographic scope, prohibited
activities or otherwise, the parties agree that
this covenant shall be reduced or curtailed to
the extent necessary to render it enforceable.
(e) In an action to enforce or challenge these
Covenant Not-to-Compete and No Solicitation
provisions, the prevailing party is entitled to
recover its attorney's fees and costs.
(f) By signing this Agreement, the Executive
acknowledges that he/she understands the effects
of these Covenant Not-to-Compete and No
Solicitation provisions and agrees to abide by
them.
6. TERMINATION
(a) Death. The Executive's employment hereunder shall
terminate upon his death.
(b) Disability. If during the Term the Executive becomes
physically or mentally disabled in accordance with
the terms and conditions of any disability insurance
policy covering the Executive, or, if due to such
physical or mental disability the Executive becomes
unable for a period of more than six (6) consecutive
months to perform his duties hereunder on
substantially a full-time basis as determined by the
Company in its sole reasonable discretion, the
Company may, at its option, terminate the
Executive's employment hereunder upon not less than
thirty (30) days' written notice.
(c) Cause. The Company may terminate the Executive's
employment hereunder for Cause effective immediately
upon notice. For purposes of this Agreement, the
Company shall have "Cause" to terminate the
Executive's employment hereunder: (i) if the
Executive engages in conduct which has caused or is
reasonably likely to cause demonstrable and serious
injury to Company; (ii) if the Executive is
convicted of a felony as evidenced by a binding and
final judgment, order, or decree of a court of
competent jurisdiction; (iii) for the Executive's
neglect of his duties hereunder or the Executive's
refusal to perform his duties or responsibilities
hereunder as determined by the Company's Board of
Directors in good faith; (iv) consistent failure to
achieve goals established by the Board of Directors
or their designate; (v) gross incompetence; (vi) for
the Executive's violation of this Agreement,
including, without limitation, Section 5 hereof;
(vii) chronic absenteeism; (viii) for use of illegal
drugs; (ix) insobriety by the Executive while
performing his or her duties hereunder; and (x) for
any act of dishonesty or falsification of reports,
records, or information submitted by the Executive
to the Company.
(d) Non-Compete Payment and Liquidated Damages. In the
event of a termination of the Executive's employment
pursuant to Section 6 or by the Executive, all
payments and Company benefits to the Executive
hereunder, except the payments (if any) provided
below, shall immediately cease and terminate. In the
event of a termination by the Company of the
Executive's employment with the Company for any
reason other than pursuant to Section 6(c), the
Company shall pay the Executive Liquidated Damages
as defined in (e) below for early termination of his
employment and the Covenant Not-to-Compete set forth
in Section 5 hereof shall remain in full force and
effect through the full stated Term of this
Agreement; and additionally, from the end of the
Term of this Agreement through the non-compete
period stated on Exhibit "A", the Company shall pay
the Executive Not-to-Compete pay in equal biweekly
installments ("Non-Compete Payment Installments") in
the amount set forth on Exhibit A ("Non-Compete
Payment"). Such Non-Compete Payment, however, shall
not be required to be paid by the Company if the
Company elects, in its sole discretion, to release
the Executive from the Covenant Not-to-Compete set
forth in Section 5 hereof. Additionally, if the
Company commences paying Executive Non-Compete
Payment Installments and subsequently elects in the
future, in its sole discretion, to release Executive
from the Covenant Not-to-Compete and gives notice to
Executive, then, at the effective date of such
notice, Executive shall no longer be subject to the
Covenant Not-to-Compete, and no further Non-Compete
Payment Installments shall be due or payable to
Executive. If the Company terminates the Executive's
employment pursuant to Section 6(c) or the Executive
terminates such employment, the Executive shall not
be entitled to the Non-Compete Payment, and the
Covenant Not-to-Compete set forth in Section 5
hereof shall remain in full force and effect.
Notwithstanding anything to the contrary herein
contained, the Executive shall receive all
compensation and other benefits to which he was
entitled under this Agreement or otherwise as an
executive of the Company through the termination
date.
(e) The Liquidated Damages amount, if due as provided
above, shall be equal to the weekly amount stated on
Exhibit A times the number of weeks remaining
between the early termination date and the end of
Term as stated on Exhibit A ("Liquidated Damages").
This amount shall be paid biweekly in equal
installments over such period.
5
7. NOTICE. For purposes of this Agreement, notices and all other
communications provided for herein shall be in writing and shall be deemed to
have been duly given when hand-delivered, sent by telecopier, facsimile
transmission, or other electronic means of transmitting written documents (as
long as receipt is acknowledged) or mailed by United States certified or
registered mail, return receipt requested, postage prepaid, addressed as
follows:
If to the Executive, to the address set forth on the
signature page.
If to the Company: Xxxxx Enterprises, Incorporated
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxx, Xxxxxxx 00000
Attention: President
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that a notice of change of address shall
be effective only upon receipt.
8. ENFORCEMENT, GOVERNING LAW, AND ATTORNEY'S FEES. It is
stipulated that a breach by Executive of the restrictive covenants set forth in
Sections 4 and 5 of this Agreement will cause irreparable damage to Company or
its Clients, and that in the event of any breach of those provisions, Company
is entitled to injunctive relief restraining Executive from violating or
continuing a violation of the restrictive covenants as well as other remedies
it may have. Additionally, such covenants shall be enforceable against the
Executive's successors or assigns or by successor assigns.
The validity, interpretation, construction, and performance of this
Agreement shall be governed by the internal laws of the State of Florida. Any
litigation to enforce this Agreement shall be brought in the state or federal
courts of Hillsborough County, Florida, which is the principal place of
business for Company and which is considered to be the place where this
Agreement is made. Both parties hereby consent to such courts' exercise of
personal jurisdiction over them.
Except where required, to enforce the restrictive covenants regarding
Not-to-Compete, No Solicitation, and Confidential Information, as provided in
Sections 4 and 5 of this Agreement, Company and the Executive will each pay
their own attorney's fees and costs in the event Company or the Executive must
enforce any of the other rights granted to them, regardless of the outcome of
any action seeking to enforce rights under this Agreement.
9. MISCELLANEOUS. No provision of this Agreement may be modified
or waived unless such waiver or modification is agreed to in writing signed by
the parties hereto; provided, however, that the terms of the performance bonus
and fringe benefits set forth or Exhibit A may be amended by the Company in its
discretion without the Executive's consent to the extent provided therein. No
waiver by any party hereto of any breach by any other party hereto shall be
deemed a waiver of any similar or dissimilar term or condition at the same or
at any prior or subsequent time. This Agreement is the entire agreement between
the parties hereto with respect to the Executive's employment by the Company
and there are no agreements or representations, oral or otherwise, expressed or
implied, with respect to or related to the employment of the Executive which
are not set forth in this Agreement. Any prior agreement relating to the
Executive's employment with the Company is hereby superseded and void, and is
no longer in effect. This Agreement shall be binding upon and inure to the
benefit of the Company, its respective successors and assigns, and the
Executive and his heirs, executors, administrators and legal representatives.
Except as expressly set forth herein, no party shall assign any of his or its
rights under this Agreement without the prior written consent of the other
party and any attempted assignment without such prior written consent shall be
null and void and without legal effect. The parties agree that if any provision
of this Agreement shall under any circumstances be deemed invalid or
inoperative, the Agreement shall be construed with the invalid or inoperative
provision deleted and the rights and obligations of the parties shall be
construed and enforced accordingly. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original but all of
which together will constitute but one and the same instrument. This Agreement
has been negotiated and no party shall be considered as being responsible for
such drafting for the purpose of applying any rule construing ambiguities
against the drafter or otherwise.
6
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
XXXXX ENTERPRISES, INCORPORATED EXECUTIVE
By:
---------------------------------- -------------------------------------
Xxxxx X. Xxxxxxx
Address:
---------------------------------- -------------------------------------
7
Xxxxx X. Xxxxxxx
Group Executive
Senior Vice President
Performance Management and
Administration
EXHIBIT A TO EMPLOYMENT AGREEMENT
This Exhibit A is attached to and made a part of that certain
Employment Agreement dated effective March 1, 2000, entered into by and between
Xxxxx Enterprises, Incorporated (the "Company") and Xxxxx X. Xxxxxxx (the
"Executive," which supercedes and replaces that certain Employment Agreement
dated April 5, 1999 entered into by and between the Company and the Executive.
TERM: Two (2) Years, commencing March 1, 2000.
BASE SALARY $4,326.92 per week
PERFORMANCE BONUS: 0% to 50% of annual Base Salary (See Attachment I)
FRINGE BENEFITS: Standard fringe benefits for executives
TERM OF COVENANT
NOT TO COMPETE: 12 months
NON-COMPETE PAYMENT: $4,326.92 per week for 52 weeks
LIQUIDATED DAMAGES $4,326.92 per week
THE COMPANY RESERVES THE RIGHT, AT ITS SOLE DISCRETION, AT SUCH TIME OR TIMES
AS IT ELECTS, TO CHANGE OR ELIMINATE BONUSES OR OTHER BENEFITS.
IN WITNESS WHEREOF, the parties have executed this Exhibit A to the
Employment Agreement as of the ___ day of _____________, 2000.
XXXXX ENTERPRISES, INCORPORATED EXECUTIVE
By:
---------------------------------- -------------------------------------
