EXHIBIT 10.3
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is effective this 17th day
of May, 1999 (the "Effective Date"), by and between New Commodore Cruise Lines
Limited, a corporation organized under the laws of Bermuda ("Company"), and
Xxxxx X. Xxxxxxxx ("Employee"). The Company desires to develop, promote and
expand its cruise business (the "Company's Cruise Business"). In consideration
of the premises and the mutual agreements herein, the Company and Employee
hereby agree as follows:
1. EMPLOYMENT.
The Company hereby employs Employee, and Employee hereby accepts and
agrees to such employment, commencing on the Effective Date. Employee shall be
employed by the Company as President. Employee shall have the duties and
responsibilities normally associated with this office. Employee shall report to
the Chief Executive Officer of Commodore Holdings Limited ("Commodore") and
functionally will liase with the Executive Vice President of Commodore with
respect to sales and marketing functions. Unless earlier terminated under
Sections 4, 6 or 7, below, this Agreement shall be in effect until May 16, 2001
(the "Term"). While employed by the Company, Employee shall not, without the
prior written consent of the Company, render his professional services to anyone
other than the Company, and will devote his full professional time, attention,
and best efforts to the business of the Company and the fulfillment of his
duties and obligations hereunder. Employee will not, while employed by the
Company, accept any position, employment, gratuities, compensation, promises,
commitments, reimbursements or funds or the equivalent of funds from any person,
corporation, partnership or other business entity whatsoever engaged in any
aspect of the business in which the Company is engaged or which is a supplier or
customer of the Company.
2. COMPENSATION.
(a) For all services rendered by the Employee pursuant to Section 1
hereof, the Company shall pay to and provide for Employee (i) a salary of
$175,500 per annum, which salary shall be increased by four percent (4%) on each
anniversary of the Effective Date, and (ii) any additional benefits provided
herein.
(b) Employee shall be entitled to such bonuses as the Company's
Board of Directors grants to him in its sole discretion.
3. VACATION AND OTHER BENEFITS.
During the Term, Employee shall be entitled to vacations (without
deduction in compensation or benefits) of such duration and at such time or
times as may be consistent with prevailing vacation policies of the Company, but
not less than three weeks per calendar year. Such vacation time shall be
adjusted pro rata for the number of months worked in the initial and final
partial years of the Term. Unused available vacation time shall not cumulate
from year to year. Unused available vacation time shall be paid to Employee at
his normal salary rate in the event of termination of this Agreement for any
reason. To the extent otherwise eligible, Employee may participate in any group
hospitalization, medical, stock option, bonus or other
similar Company benefit plan which is or may become generally available to
executive employees of the Company.
4. INCAPACITY.
(a) If Employee is unable at any time during the term of this
Agreement to perform his services by reason of physical or mental illness or
incapacity, he shall receive his then regular compensation for a cumulative
period of 90 days per calendar year but in no event beyond the term of this
Agreement. Such leave time shall be adjusted pro rata for the number of months
worked in the initial and final partial years of this Agreement. Unused medical
leave shall not cumulate from year to year. Unused available medical leave shall
be paid to Employee at his normal salary rate in the event of termination of
this Agreement for any reason. If Employee is unable to consistently perform his
material duties under this Agreement for any period of 90 consecutive days by
reason of physical or mental illness or incapacity, the Company shall continue
payment of Employee's salary for 90 more days after the first 90 days, provided,
however after the second 90 days the Company may terminate this Agreement at any
time without any further liability to Employee beyond the second 90 days of
salary. Periods of consecutive incapacity arising from the same mental or
physical condition which are less than 90 days each shall be cumulated and
considered consecutive. The Board of Directors of the Company shall determine in
its sole discretion in good faith whether Employee is ill or incapacitated for
purposes of this Section 4(a).
(b) In the event of death of Employee at any time during the term of
this Agreement, the Company shall pay to his surviving spouse, if any, the pro
rata salary to which Employee was entitled through the date of his death plus a
death benefit of six months of additional salary. If Employee has no surviving
spouse, then the Company shall pay the aggregate amount of such pro rata salary
and death benefit to Employee's estate.
5. EXPENSES. Employee shall be reimbursed by the Company for his
ordinary and necessary business expenses upon presentation of receipts therefor
to the Company. In addition, he shall receive a car allowance of $500 per month.
6. TERM. The Term shall begin on the Effective Date and expire on May
16, 2001, unless earlier terminated under Section 4, above, or Section 7, below.
Notwithstanding the foregoing, the Company shall have the option to terminate
this Agreement upon six (6) months prior notice to Employee.
7. TERMINATION FOR CAUSE. If at any time Employee shall commit an act
of theft or embezzlement from or fraud on the Company, shall consistently
neglect his duties while employed by the Company (except as provided in Section
4(a)) which behavior continues after receiving written notice from the Company
that he has been consistently neglecting his duties, shall willfully refuse to
continue his employment with the Company (except as provided in Section 4(a)),
shall fail materially to comply with the Company's policies in good faith, shall
be in material breach or default of this Agreement, shall have materially
breached a representation or warranty herein, shall commit an act of moral
turpitude or illegality that brings the reputation of the Company into public
disrepute or causes the Company to be generally viewed unfavorably by customers
or suppliers, the Company may forthwith terminate this Agreement by written
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notice and shall have no further liability hereunder except for compensation
accrued to the date of such termination notice or the first date of willful
refusal by Employee to continue his employment, as the case may be.
8. TRADE SECRETS AND EMPLOYMENT OF COMPANY EMPLOYEES.
(a) During the Term and thereafter, Employee shall not, except as
required by Employee's duties to the Company, without the Company's prior
written consent, directly or indirectly, disclose, furnish, or cause to be
disclosed or furnished, or use to the detriment of the Company any proprietary,
confidential or trade secret information, whether or not patentable or
copyrightable, belonging to the Company which Employee gains knowledge of during
his employment and which was not known to Employee prior to the date of this
Agreement, whether or not developed by Employee and whether or not marked or
designated as proprietary, confidential, or trade secret.
(b) For a period from the date hereof until six months from the date
of Employee's termination of employment with the Company for any reason,
Employee shall not, directly or indirectly:
(1) induce or attempt to induce away, or aid, assist or abet any
other party or person in inducing or attempting to induce away any person from
his or his employment with the Company;
(2) hire or attempt to hire any former employee of the Company
within one year after the termination for any reason of such employee's
employment with the Company;
(3) take away or attempt to take away, or aid, assist or abet
any other party or person in taking away or attempting to take away, any
customers of the Company who were such customers at the date of Employee's
termination of employment; or
(4) in any form copy, duplicate or otherwise compile any list of
past, present, or potential customers of the Company except on an as-needed
basis while employed by the Company and upon termination of Employee's
employment with the Company for any reason Employee shall immediately return all
such lists, and all copies, duplicates, and compilations thereof, to the
Company.
Employee acknowledges that a violation of this Section 8(b) would
lead to inevitable injury to the Company by interference with critical customers
and employees of the Company.
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9. NONCOMPETITION.
(a) For a period from the date hereof until the date specified in
Section 9(b), below, Employee will not, whether individually or as a member of a
partnership or as an officer, director, investor, stockholder, creditor,
employee or consultant of a corporation or of any other person, limited
liability company, partnership or other entity, engage or seek to engage in a
business the same as or similar to the divisions of the Company's business with
which the Employee was materially involved in the same market that the Company
is operating. The ownership by Employee of 5% or less of the outstanding stock
of any corporation engaged in any such competitive business, but whose stock is
listed on a national securities exchange or is a Nasdaq listed stock, shall not
be deemed by itself to be a violation by Employee of this section. In the event
that for any reason there should be a determination by a court of competent
jurisdiction that the provisions of this section are too broad or unreasonable
or unenforceable as such, then such provisions shall be deemed modified and
fully enforceable as so modified to the extent that such a court would find them
fair, reasonable and enforceable under the circumstances.
(b) This Section 9 shall be effective for the longer of (i) one year
after the termination of Employee's employment pursuant to Section 7 or his
voluntary termination, or (ii) the unexpired Term. In any other event of
termination of this Agreement, this Section 9 shall terminate on the date of the
termination of this Agreement.
10. MATERIALITY AND REMEDIES. Employee acknowledges that a violation of
the noncompetition or nondisclosure provisions of Sections 8 and 9 will cause
irreparable injury to the Company in that its vital confidential or proprietary
knowledge will become public knowledge causing it to lose its competitive
advantage and goodwill. Therefore, since damage to the Company will be difficult
to ascertain, the Company shall be entitled without the showing or proving of
any factual damages sustained to a temporary restraining order or injunction
granted by a competent court of equity to prevent a breach or further breach of
Sections 8 and 9 of this Agreement. If a court should nevertheless require a
showing of damages, then the Company may meet this burden by showing it has a
legitimate business interest to protect and competition itself will be injurious
to the Company. Without regard to whether or not the Company seeks or is granted
equitable relief, the Company shall not be prejudiced in its right to seek and
be awarded damages for breach.
11. CHANGE OF CONTROL.
(a) Unless this Agreement has been earlier terminated before a
Change of Control of Commodore Holdings Limited, the Company's parent
("Commodore"), as defined below, Employee shall have the option in his
discretion to terminate this Agreement in writing within 30 days after the date
of the Change of Control and receive an amount equal to a continuation of his
salary and other benefits for the greater of:
(1) one year from the date of the Change of Control, or
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(2) the time remaining under this Agreement after the date of
the Change of Control. Payment shall be made to Employee in one lump sum within
30 days after receipt of Employee's notice of termination.
(b) A "Change of Control" shall have occurred on the date that a
majority of the persons on the Board of Directors of Commodore are persons (i)
who obtained their seats other than in the normal course as a result of death or
voluntary resignation and (ii) whose appointment to the Board was not with the
approval of the majority of the directors in office immediately before his
election to the Board of Directors.
12. INDEMNIFICATION. The Company shall indemnify Employee including,
without limitation, for legal fees, to the fullest extent provided or permitted
under Bermuda law to past or current directors and officers of the Company and
its affiliates in the performance of their duties which indemnification shall
survive the termination of this Agreement, anything else to the contrary in this
Agreement notwithstanding.
13. ARBITRATION. Any disagreement between Employee and the Company
concerning the interpretation or fulfillment of this Agreement shall be
submitted to arbitration pursuant to the rules then prevailing of the American
Arbitration Association in Miami-Dade County, Florida. The ruling of the
arbitrator shall be final and binding on the parties and shall be enforceable in
any court having jurisdiction thereof. The arbitrator shall have the authority
to award the costs of the arbitration, including, without limitation, the legal
fees and costs incurred by the parties, to either party as he deems appropriate.
14. ENTIRE AGREEMENT. This Agreement contains the entire agreement
concerning employment arrangements between the Company and Employee and
supersedes all prior written and oral understandings of the parties with respect
thereto. This Agreement may not be changed except by a writing signed by the
party against whom the enforcement of any waiver, change, extension,
modification or discharge is sought.
15. NOTICES. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and delivered in person or sent by
certified mail to the party involved at the address shown on the signature page,
or to such other address as either party may specify to the other in writing.
The date two days after the date of mailing of such notice shall be deemed to be
the date of delivery thereof.
16. ASSIGNMENT. This Agreement shall inure to the benefit of, and shall
be binding upon, the Company, its successors and assigns, Employee, his heirs
and personal representatives, but may not be assigned by Employee.
17. SEVERABILITY. In the event any term, section or provision of this
Agreement or its application to any circumstances shall to any extent be deemed
invalid or unenforceable, the remainder of this Agreement shall be valid and
enforceable to the fullest extent permitted by law.
18. APPLICABLE LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Florida.
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19. CONSULTATION OF ATTORNEYS. The Company and Employee acknowledge
that they each have had the opportunity to consult its or his respective
attorney with respect to this Agreement and that they each understand its
contents.
20. SECTION HEADINGS. The section headings contained herein are for
reference only and shall not in any way affect the meaning or interpretation of
this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day
and year first written above.
"Employee" "Company"
NEW COMMODORE CRUISE LINES LIMITED
/s/ XXXXX X. XXXXXXXX By: /s/ XXXXXXXXX X. XXXXX
--------------------------- ------------------------------
XXXXX X. XXXXXXXX
Its: CHIEF EXECUTIVE OFFICER
Address: Address:
___________________________ 0000 Xxxxxxxxx Xxxxxxxxx
___________________________ Suite 385, South Tower
___________________________ Xxxxxxxxx, XX 00000
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