EXHIBIT 10.10
AMENDMENT TO EMPLOYMENT AGREEMENT
This Amendment to Employment Agreement (this "Agreement"), dated as of
November 7, 2002 and effective as of October 23, 2002 (the "Effective Date"), is
between XXXX XXXXXXX AUCTIONS, INC, a Delaware corporation ("GMAI"), and XXXXX
X. XXXXXXXX, an individual ("Xx. Xxxxxxxx").
GMAI and Xx. Xxxxxxxx are parties to an Employment Agreement, dated April
23, 2001 (the "Original Agreement"), pursuant to which Xx. Xxxxxxxx has been
employed by GMAI as its Chief Financial Officer and Executive Vice President.
The Term set forth in the Original Agreement terminates on April 23, 2003.
In connection with certain transactions known collectively as the "Lenape
Project", the parties desire to amend and extend the Original Agreement at this
time rather than at the end of the original Term. The Board of Directors of GMAI
approved the terms hereof on the Effective Date.
GMAI and Xx. Xxxxxxxx therefore agree as follows:
1. Effective the Effective Date, the Term as set forth is Section 1 of
the Original Agreement is hereby extended to June 30, 2006 (subject to earlier
termination as provided in the Original Agreement).
2. Effective the Effective Date, paragraph (a) of Section 3 of the
Original Agreement is hereby amended to read as follows:
"Compensation. (a) GMAI shall pay Xx. Xxxxxxxx a salary of $150,000
per annum, which will increase to $160,000 per annum on May 1, 2003;
to $175,000 on May 1, 2004; and to $190,000 on May 1, 2005 (that
salary, the "Base Salary"). Payment of the Base Salary will be in
accordance with GMAI's standard payroll practices and subject to all
legally required or customary withholdings."
3. Effective the Effective Date, paragraph (b) of Section 3 of the
Original Agreement is hereby amended to read as follows:
"(b)(i) In the event that in any full fiscal year during the Term
GMAI's Audited Pre-Tax Income (as defined below) equals or exceeds
$50,000, GMAI shall pay to Xx. Xxxxxxxx a cash bonus equal to 25% of
such Pre-Tax Income, up to a maximum bonus of $50,000 (that bonus, a
"Bonus"). The term "Audited Pre-Tax Income" means the net income of
GMAI for the fiscal year before federal income taxes and bonuses
paid under this section and any other executive employment
agreement entered into by GMAI, determined in accordance with
generally accepted accounting principles consistently applied as
determined by GMAI's independent auditors.
"(ii) The bonus for each fiscal year provided for above shall be
payable promptly after the amount of the Audited Pre-Tax Income
shall have been determined by GMAI's independent auditors as
evidenced by an executed report of such auditors (including for the
last year of the Term hereunder, even if Xx. Xxxxxxxx shall no
longer be employed by GMAI)."
4. Effective as of November 1, 2002, paragraph (a) of Section 5 of the
Original Agreement is hereby amended to read as follows:
"Benefits. (a) GMAI shall pay to Xx. Xxxxxxxx, in a manner
consistent with GMAI's standard payroll practices (and subject to
all legally required or customary withholdings), an annual
non-accountable expense allowance equal to $15,000 per year during
the Term." and
Effective as of November 1, 2002, a new paragraph (c) is hereby
added to Section 5 of the Original Agreement, reading as follows:
"(c) During the Term hereunder, Xx. Xxxxxxxx shall be entitled to
the use of an automobile with a base lease cost of up to $425 per
month."
5. Contemporaneously with the execution of this Agreement, GMAI and Xx.
Xxxxxxxx are entering into a Stock Option Agreement, reflecting the grant by
GMAI to Xx. Xxxxxxxx of options to purchase 75,000 shares of common stock of
GMAI, which options shall vest 33 1/3% on the Effective Date and 33 1/3% per
year on each of the first and second anniversaries of the Effective Date, and
shall be exercisable at a price equal to $1.35 per share, which is not less than
the fair market value of the common stock of GMAI as of the Effective Date.
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6. This Agreement is governed by the laws of the State of New York,
without giving effect to principles of conflict of laws.
7. Except as specifically amended hereby, the Original Agreement shall
remain in full force and effect in accordance with its terms. This Agreement
shall not constitute an amendment to or modification of any other agreement
between the parties hereto. Capitalized terms used herein and not otherwise
defined will have their meanings as set forth in the Original Agreement.
XXXX XXXXXXX AUCTIONS, INC.
By: /s/ Xxxx Xxxxxxx
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Xxxx Xxxxxxx
Chairman of the Board, Chief Executive Officer
and President
/s/ Xxxxx Xxxxxxxx
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XXXXX X. XXXXXXXX
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