EXHIBIT 10.10
EXECUTIVE EMPLOYMENT AGREEMENT
BY AND BETWEEN
XxxxxXxxxxx.xxx CORPORATION
AND
XXXXXXX X. XXXXXXXXX
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THIS EXECUTIVE EMPLOYMENT AGREEMENT (this "Agreement") is made and entered
into as of December 1, 1999 by and between XxxxxXxxxxx.xxx Corporation f/k/a
Divot Golf Corporation f/k/a Brassie Golf Corporation, a Delaware corporation
(the "Company"), and XXXXXXX X. XXXXXXXXX as Corporate Counsel ("Executive").
WHEREAS, the Company and Executive desire to enter into this Agreement to
assure the Company of the services of the Executive and to set forth the
respective rights and duties of the parties hereto; and
WHEREAS, the Company: (i) is presently in the business of providing
Internet travel, entertainment and related access services over the Internet
through its ownership and management of various proprietary and technological
holdings, licensing rights, subscription agreements and other related services;
and (ii) intends to invest its available resources in one or more new business
ventures (such activities, present and future, being hereinafter referred to as
the "Business").
NOW, THEREFORE, in consideration of the premises and the mutual covenants,
terms and conditions set forth herein, the Company and Executive agree as
follows:
ARTICLE I
Employment
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1.1 Employment and Title. The Company hereby employs Executive Executive
hereby accepts such employment, as Corporate Counsel, a member of the Board of
Directors and Director of the Legal committee of the Company, all upon the terms
and conditions set forth herein.
1.2 Services. During the Term (as hereinafter defined) hereof, Employee
agrees to perform diligently and in good faith the duties of Corporate Counsel,
a member of the Board of Directors and Director of the Legal committee of the
Company under the direction of the Board of Directors of the Company (the "Board
of Directors"). Employee agrees to devote his best efforts and substantially all
of his full business time, energies and abilities to the services to be
performed hereunder and for the exclusive benefit of the Company. Employee shall
be vested
with such authority as is generally commensurate with the position of Corporate
Counsel, a member of the Board of Directors and Director of the Legal committee
of the Company, as further outlined below./1/
1.3 Location. The principal place of employment and the location of
Employee's principal offices shall be in the State of New York; provided,
however, Employee shall form time to time temporarily perform outside of the
State of New York, such services as are reasonably required for the proper
execution of his duties under this Agreement.
1.4 Representations. Each party represents and warrants to the other that
he/it has full power and authority to enter into and perform this Agreement and
that his/its execution and performance of this Agreement shall not constitute a
default under or breach of any of the terms of any agreement to which he/it is a
party or under which he/it is bound. Each party represents that no consent or
approval of any third party is required for his/its execution, delivery and
performance of this Agreement or that all consents or approvals of any third
party required for his/its execution, delivery and performance of this Agreement
have been obtained.
1.5 Sole Discretion. As the term "sole discretion" is used in this
Agreement, unless otherwise defined, it will be interpreted as the exercise of
reasonable discretion applying normal business practices to a contractual
relationship between a company and its Corporate Counsel, a member of the Board
of Directors and Director of the Legal committee.
ARTICLE II
Term
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2.1 Term. The term of Executive's employment hereunder (the "Term") shall
commence as of the date hereof (the "Commencement Date") and shall continue
through the fifth anniversary of the Commencement Date (the "Scheduled
Termination Date") unless earlier terminated pursuant to the provisions of this
Agreement.
2.2 Renewal. This Agreement shall be renewed for successive one year terms
unless either party hereto provides written notice of non-renewal at least sixty
(60) days prior to the Scheduled Termination Date of each such term.
Notwithstanding the foregoing, each renewal hereof shall constitute a separate
and distinct agreement. If notice of non-renewal is given by either party. all
terms of this Agreement shall remain in full force and effect until the earlier
of the
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/1/ The company acknowledges that the Employee is an Attorney licensed in the
State of New York. That at the time of the Agreement Employee is obligated to
various clients for whom Employee remains duty-bound to conclude the legal
representation afforded them by the Employee. The Company agrees that Employee
is authorized to continue his representation of those clients for so long as it
may take to conclude their legal representation. Employee agrees not to
undertake the legal representation of any new clients without the express
written consent of the OrbitTravel Board of Directors.
following (i) a new employment agreement is entered into by the parties, or (ii)
employment is terminated under the terms and conditions in Article VII hereof.
ARTICLE III
Compensation
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3.1 Base Salary. As compensation for the services to be rendered by
Employee, the Company shall pay Employee, during the Term of this Agreement, an
annual base salary equal to One Hundred Eighty Thousand and 00/100 Dollars
($180,000.00), which base salary shall accrue monthly (prorated for periods less
than a month) and shall be paid in equal bimonthly installments, in arrears. The
base salary will be reviewed annually, or more frequently, as appropriate, by
the Board of Directors or the Compensation Committee of the Board of Directors,
as the case may be, in its sole discretion, provided that the annual base salary
shall not be decreased below One Hundred Eighty Thousand and 00/100 Dollars
($180,000.00). Employee may choose cash payment of one hundred eighty thousand
dollars to be paid as cash or at the election of Employee to be paid in stock at
a fifteen percent (15%) discount to the market based on a ten day trailing
average.
3.1 Vacation & Holidays As further compensation for services to be rendered by
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the executive, the executive shall accrue twenty one days of annual paid
vacation or leave and shall enjoy all REGULAR state and federal holidays.
3.2 Stock Options. The Company shall issue Executive options to purchase
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Five Million (5,000,000) shares of the Company's common stock at a per share
market value option price as soon as practicable after the date on which the
Company's proposals regarding a Stock Option Plan commencing the year 2000 and
an increase in the Company's authorized common stock are adopted by the
Company's shareholders, if necessary. The Options shall not be subject to any
vesting period. All options shall have an exercise period of five (5) years. The
number and price of the option shares shall be subject to equitable adjustment
in the event the Company's 1-for-20 reverse stock split is adopted by the
Company's shareholders.
(a) Default Provision In the event the company defaults on said severance
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and the Executive and the company are unable to arrive at a mutually
agreed upon extension the Executive may elect a conversion to
preferred stock at a base of a twenty five percent (25%) discount to
market on a ten day trailing average.
(b) No Dilution or Impairment: xxxxxxxxxxx.xxx Corporation f/k/a Divot
-------------------------
Golf Corporation hereby agrees that it shall not, by amendment of its
Certificate of Incorporation or through any reorganization, transfer
of capital stock or assets, consolidation, merger, dissolution, issue
or sale of securities or any other voluntary action, avoid or seek to
avoid the
observance or performance of any of the terms of this Agreement, but
will at all times in good faith assist in the carrying out of all such
terms and in the taking of all such action as may be necessary or
appropriate in order to protect the rights of Executive against
dilution or other impairment of the Shares issued hereunder.
(c) Anti-Dilution Provision The effects of anti-dilution pursuant to the
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terms and conditions as contained herein provide that the company
shall be entitled to issue additional shares of its capital stock in
connection with mergers and acquisitions and financing in the ordinary
course of business; provided, however, that in case the Company shall,
at any time after the date hereof, reorganize, recapitalize, issue or
sell any shares of Common Stock or issue warrants, options or other
securities convertible into, or exercisable or exchangeable for,
shares of Common Stock ("Convertible Securities") for a consideration,
or in the case of the issuance of Convertible Securities, an exercise
price or conversion price per share less than the Fair Market Value or
the Exercise Price in effect immediately prior to the issuance or sale
of such securities, then forthwith upon such issuance or sale, the
Exercise Price shall be reduced to the price determined by dividing
(I) an amount equal to the sum of (a) the number of shares of Common
Stock outstanding (after giving effect to the conversion or exercise
of all Convertible Securities) immediately prior to such issuance or
sale multiplied by the then existing Exercise Price and (b) the
aggregate amount of the consideration, if any, received by the Company
upon such issuance or sale by (ii) the total number of shares of
Common Stock outstanding (after giving effect to the conversion or
exercise of all Convertible Securities) immediately after such
issuance or sale. In no event shall the Exercise Price be adjusted
pursuant to this computation. In the event of a stock split, stock
divided, or other recapitalization pursuant to which the number of
outstanding shares of capital stock of the Company shall increase, the
number of shares covered by any unexercised portion of this Option and
the related Exercise Price per share shall be adjusted
proportionately. In the event of a combination or other
recapitalization pursuant to which the number of outstanding shares of
capital stock of the Company shall be reduced, the number of shares
covered by any unexercised portion of this Option and the related
Exercise Price per share shall not be subject to adjustment and shall
remain as in effect prior to such combination or recapitalization.
(d) Executive shall be entitled to receive: (i) a lump sum payment equal
to the sum of the present value of 100% of Executive's base salary for
the balance of the term of this Agreement; and (ii) a lump sum
severance payment in the amount of Nine Hundred Thousand Dollars
($900,000.00) (collectively, the "Severance Payments") which shall be
paid by the Company within sixty (60) days of the date of termination.
In addition, in the event of a termination without cause for any
reason other than death, Executive shall be entitled to receive the No
renewal Payment (as defined in Section 7.7);
(e) Right of Lien Executive shall be issued a UCC 1 which shall be
recorded by the company in the amount of Nine Hundred Thousand Dollars
($900,000.00) (collectively, the "Severance Payments") for the purpose
of security in the event of default under the provisions of this
agreement. Upon payment in full of all shares and money Executive
shall release said lien.
(f) Except as provided in Article XI, this Agreement shall thereupon be of
no further force or effect. Any amounts due from Company pursuant
above and not paid to Executive as and when due shall accrue interest
at the prime rate of interest as established from time to time by
Chase Manhattan Bank of New York. Company may purchase insurance to
cover all or any part of its obligations set forth in this Section,
and Executive agrees to take a physical examination to facilitate the
purchase of such insurance.
3.3 Incentive Compensation. The Company shall pay Employee, during the
Term of this Agreement, an annual performance/incentive bonus which shall be
calculated as follows:
Fiscal Year
Revenue Bonus
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$0 - 2,000,000 Five Percent (5%) of Base Salary
$2,000,00 to $5,000,000 Fifteen Percent (15%) of Base Salary
$5,000,00 to $10,000,000 Thirty Percent (30%) of Base Salary
In excess of $10,000,001 Fifty Percent (50%) of Base Salary
Sale of Company Five Percent of the Purchase Price
Capital Raised Two Percent of all Capital Raised
3.4 Benefits. Employee shall be entitled, during the Term hereof, to the
same medical, hospital dental and life insurance coverage and benefits as are
available to the Company's most senior executive officers on the Commencement
Date.
3.5 Withholding. Any and all amounts payable under this Agreement.
including, without limitation, amounts payable under this Article Ill and
Article VII, are subject to withholding for such federal, state and local taxes
as the Company, in its reasonable judgment, determines to be required pursuant
to any applicable law, rule or regulation.
ARTICLE IV
Working Facilities, Expenses and Insurance
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4.1 Working Facilities and Expenses. Employee shall maintain his own
office, or shall be provided an office at the discretion of management or at
such other location as agreed to by Employee and the Company, and other working
facilities and secretarial and other assistance suitable to his position and
reasonably required for the performance of his duties hereunder The Company
hereby agrees to reimburse Employee for pre approved expenses associated with
the maintainance of an office at such other location than employees home office.
The Company shall promptly reimburse Employee for all pre approved expenses or
such other of Employee's reasonable expenses incurred while employed, and
performing his duties under and in accordance with the terms and conditions of
this Agreement, subject to Employee's full and appropriate documentation,
including, without limitation, receipts for all such expenses in the manner
required pursuant to Company's policies arid procedures and the Internal Revenue
Code of 1986, as amended (the "Code"), and applicable regulations as are in
effect from time to time.
4.2 Insurance. The Company may secure in its own name or otherwise, and at
its own expense, life, disability, and other insurance covering Employee or
Employee and others, and Employee shall not have any right, title or interest in
or to such insurance other than as expressly provided herein. Employee agrees to
assist the Company in procuring such insurance by submitting to the usual and
customary medical and other examinations to be conducted by such physicians(s)
as the Company or such insurance company may designate and by signing such
applications and other written instruments as may be required by any insurance
company to which application is made for such insurance.
ARTICLE V
Illness or Incapacity
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5.1 Right to Terminate. If, during the Term of this Agreement, Employee
shall be unable to perform in all material respects his duties hereunder for a
period exceeding six (6) consecutive months by reason of illness or incapacity,
this Agreement may be terminated by the Company in its sole discretion pursuant
to Section 7.2 hereof.
5.2 Right to Replace. If Employee's illness or incapacity, whether by
physical or mental cause, renders him unable for a minimum period of ninety (90)
consecutive calendar days to carry out his duties and responsibilities as set
forth herein, the Company shall have the right to designate a person to replace
Employee temporarily in the capacity described in Article I hereof; provided,
however, that if Employee returns to work from such illness or incapacity within
the six (6) month period following his inability due to such illness or
incapacity, he shall be entitled to be reinstated in the capacity described in
Article I hereof with all rights, duties
and privileges attendant thereto.
5.3 Rights Prior to Termination. Employee shall be entitled to his full
remuneration and benefits hereunder during such illness or incapacity unless and
until an election is made by the Company to terminate this Agreement in
accordance with the provisions of this Article V.
5.4 Determination of illness or Incapacity. For purposes of this Article
V. the term "illness or incapacity" shall mean Employee's inability to perform
his duties hereunder substantially on a full-time basis due to physical or
mental illness as determined by the Board of Directors in accordance with the
Company's long-term disability insurance policy or, in the event Company does
not have a long-term disability insurance policy in effect, in accordance with
the following procedure: Employee and the Company each shall designate a
physician who shall jointly select a third physician and the three (3)
physicians selected would then determine whether or not any illness or
incapacity is such as to prevent Employee from performing his duties hereunder.
5.5 Executive's Right of Designation: Notwithstanding Paragraph 5.2
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Executive shall have the right to and be entitled to temporarily designate his
replacement in the event of incapacity for a period not to exceed an additional
six months of illness as defined in paragraph 5.1.
ARTICLE VI
Confidentiality
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6.1 Confidentiality. During the Term of this Agreement and thereafter,
Executive agrees to maintain the confidential nature of the Company's trade
secrets, including, without limitation, development ideas, acquisition
strategies and plans, financial information, records, "know-how", methods of
doing business, customer, supplier and distributor lists and all other
confidential information of the Company. Executive shall not use (other than in
connection with his employment), in any way whatsoever, such trade secrets
except as authorized in writing by the Company. Executive shall, upon the
termination of his employment, deliver to the Company any and all records,
hooks, documents or any other materials whatsoever (including all copies
thereof) containing such trade secrets, which shall be and remain the property
of the Company.
6.2 Non-Removal of Records. All documents, papers, materials, notes,
books, correspondence, drawings and other written and graphic records relating
to the Business of the Company which Employee shall prepare or use, or come into
contact with, shall be and remain the sole property of the Company.
ARTICLE VII
Termination
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7.1 Termination For Cause: This Agreement and the employment of Executive may
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be terminated by the Company for "Just Cause" or "Proper Cause" and only in
any of the following circumstances:
(a) Just Cause: "Just Cause" shall mean that Executive has been
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judicially convicted or has pleaded nolo contendere to any one of the
following offenses: (i) Executive has been judicially determined to
have committed any fraud, theft, misappropriation or similar act
against the Company or Executive has been judicially declared to have
misappropriated, or embezzled funds in connection with the Company's
business; or (ii) any felony that the Board determines is detrimental
to the Company's reputation or that otherwise interferes with
Executive's ability to perform his duties under this Agreement.
(b) Proper Cause: "Proper Cause" shall mean an Executive is in default
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in a material respect in the performance of Executive's obligations,
services or duties hereunder, which shall include, without limitation:
(i) Executive's willful disregard of the lawful written instructions
of the Executive Committee or the Board of Directors concerning the
performance of his duties within the scope hereof; (ii) Any conduct of
the Executive which is materially inconsistent with the published
policies of the Company, as promulgated from time to time and which
are generally applicable to all senior executives; or (iii)
Executive's breach of any other material provision of this Agreement,
provided, however, that Executive shall be given written notice of
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such default and a reasonable opportunity to cure such default.
An event giving rise to termination of the Executive's employment, whether
for Just Cause or Proper Cause, shall henceforth be referred to as
"Termination Events."
7.2 Termination Procedure: In the event that the Board determines that a
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Termination Event has taken place with respect to the Executive, the Board
shall undertake the following procedure to terminate Executive's
employment:
(a) The Board shall present Executive with thirty (30) day's advance
written notice of Executive's Just Cause or Proper Cause termination,
and shall include with such notice a copy of the minutes of the
meeting of the
Board that reference the Board's determination that a Termination
Event has taken place.
(b) Executive shall have thirty (30) days after his receipt of the Board's
written notice of Just Cause or Proper Cause termination in which to
deliver to the Board a written objection to such termination. Upon its
receipt of Executive's written objection, the Board will be required
to do the following:
(1) Within ten (10) day's of its receipt of Executive's written
objection, the Board shall convene a Special Meeting to
review such objection. Executive shall receive notice of,
and shall have the right to be present at any such meeting,
and may present evidence that serves to contradict the
Board's determination that a Termination Event has occurred.
The Board shall have five (5) days following such Special
Meeting in which to reverse its decision to terminate
Executive. If the Executive has not been informed of such
reversal within such five (5) day period, Executive shall
have ten (10) days in which to appeal the matter to binding
arbitration.
(c) Arbitration Procedure: Should Executive elect to submit the Board's
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decision to binding arbitration, such arbitration shall take place
within thirty (30) days, in accordance with the American International
Commercial Arbitration Rules. The number of arbitrators shall be
three; the Board shall choose one arbitrator, the Executive shall
choose one arbitrator, and both arbitrators shall choose a third
arbitrator. The place of arbitration shall be New York City, New York,
and the language of the arbitration shall be English. No discovery
shall be permitted in such dispute, other than exchange of relevant
documents ordered by the arbitrators. The maximum number of days of
hearings in such arbitration shall be 3, all of which shall occur
consecutively. The arbitrators' decision shall be limited to whether a
Just Cause or Proper Cause termination is justified under the
circumstances. Such decision shall be binding upon all parties.
7.3.1 Executive to Remain in Position: Notwithstanding any other provision of
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this Agreement to the contrary, should Executive object to a Just Cause
or Proper Cause Termination Notice, he shall remain in his position, with
the same duties and for the same compensation as set forth in this
Agreement,
during the course of such objection, until such time as Executive accepts
the Board's decision or a final decision is rendered with respect to the
matter or that the has been determined through arbitration or appeal.
(a) A Termination for cause delivered to Executive pursuant to this
Agreement shall effective as of the date set forth in a written notice
of termination delivered to Executive (which shall be no less than
thirty (30) days following the delivery of written notice), but shall
not be earlier than the date such written notice is delivered to
Executive.
7.4 Termination Without Cause: This Agreement and the employment of the
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Executive may be terminated "Without Cause" as follows:
(a) By mutual agreement of the parties hereto; or
(b) At the election of the Company by its giving not less than sixty (60)
days written notice to Executive in the event of an illness or
incapacity described in Section 5.1; or
(c) At the election of the Executive by his giving not less than sixty
(60) days written notice to the Company; or
(d) Upon the Scheduled Termination Date or on the last day of any renewal
term in the event of non-renewal of this Agreement; or
(e) Upon Executive's death.
A Termination Without Cause under Section 7.4(b), (c) or (d) hereof shall
be effective upon the date set forth in a written notice of termination
delivered hereunder, which shall be not less than sixty (60) days nor more
than one hundred twenty (120) days after the giving of such notice. A
Termination Without Cause under Section 7.4(a), (d) or (e) hereof shall be
automatically effective upon the date of mutual agreement, or the Scheduled
Termination Date or the last day of any renewal term, or the date of death
of the Executive, as the case may be.
7.5 Effect of Termination For Cause: If Executive's employment is terminated
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For Cause:
(a) Executive shall be entitled to accrued base salary under Section 3.1
Through the date of termination which shall be paid by the Company
within sixty (60) days of the date of termination;
(b) Executive shall be entitled to reimbursement for expenses accrued
through the date of termination in accordance with the provisions of
Section 4.1 hereof which shall be paid by the Company within sixty
(60) days of the date of termination; and
(c) Except as provided in Article XI, this Agreement shall thereupon be of
no further force and effect.
7.6 Effect of Termination Without Cause: If Executive's employment is
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terminated Without Cause except pursuant to Section 7.4(c) or (e) hereof:
(g) Executive shall be entitled to accrued base salary under Section 3.1
through the date of termination which shall be paid by the Company
within sixty (60) days of the date of termination;
(h) Executive shall be entitled to reimbursement for expenses accrued
through the Scheduled Termination Date in accordance with the
provisions of Section 4.1 hereof which shall be paid by the Company
within sixty (60) days of the date of termination;
(i) Default Provision In the event the company defaults on said severance
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and the Executive and the company are unable to arrive at a mutually
agreed upon extension the Executive may elect a conversion to
preferred stock at a base of a twenty five percent (25%) discount to
market on a ten day trailing average.
(j) No Dilution or Impairment: xxxxxxxxxxx.xxx Corporation f/k/a Divot
-------------------------
Golf Corporation hereby agrees that it shall not, by amendment of its
Certificate of Incorporation or through any reorganization, transfer
of capital stock or assets, consolidation, merger, dissolution, issue
or sale of securities or any other voluntary action, avoid or seek to
avoid the observance or performance of any of the terms of this
Agreement, but will at all times in good faith assist in the carrying
out of all such terms and in the taking of all such action as may be
necessary or appropriate in order to protect the rights of Executive
against dilution or other impairment of the Shares issued hereunder.
(k) Anti-Dilution Provision The effects of anti-dilution pursuant to the
-----------------------
terms and conditions as contained herein provide that the company
shall be entitled to issue additional shares of its capital stock in
connection with mergers and acquisitions and financing in the ordinary
course of business; provided, however, that in case the Company shall,
at any time after the date hereof, reorganize, recapitalize, issue or
sell any shares of Common Stock or issue warrants, options or other
securities convertible into, or exercisable or exchangeable for,
shares of Common Stock ("Convertible Securities") for a consideration,
or in the
case of the issuance of Convertible Securities, an exercise price or
conversion price per share less than the Fair Market Value or the Exercise
Price in effect immediately prior to the issuance or sale of such
securities, then forthwith upon such issuance or sale, the Exercise Price
shall be reduced to the price determined by dividing (I) an amount equal to
the sum of (a) the number of shares of Common Stock outstanding (after
giving effect to the conversion or exercise of all Convertible Securities)
immediately prior to such issuance or sale multiplied by the then existing
Exercise Price and (b) the aggregate amount of the consideration, if any,
received by the Company upon such issuance or sale by (ii) the total number
of shares of Common Stock outstanding (after giving effect to the
conversion or exercise of all Convertible Securities) immediately after
such issuance or sale. In no event shall the Exercise Price be adjusted
pursuant to this computation. In the event of a stock split, stock divided,
or other recapitalization pursuant to which the number of outstanding
shares of capital stock of the Company shall increase, the number of shares
covered by any unexercised portion of this Option and the related Exercise
Price per share shall be adjusted proportionately. In the event of a
combination or other recapitalization pursuant to which the number of
outstanding shares of capital stock of the Company shall be reduced, the
number of shares covered by any unexercised portion of this Option and the
related Exercise Price per share shall not be subject to adjustment and
shall remain as in effect prior to such combination or recapitalization.
(l) Executive shall be entitled to receive: (i) a lump sum payment equal to the
sum of the present value of 100% of Executive's base salary for the balance
of the term of this Agreement; and (ii) a lump sum severance payment in the
amount of Nine Hundred Thousand Dollars ($900,000.00) (collectively, the
"Severance Payments") which shall be paid by the Company within sixty (60)
days of the date of termination. In addition, in the event of a
termination without cause for any reason other than death, Executive shall
be entitled to receive the No renewal Payment (as defined in Section 7.7);
(m) Right of Lien Executive shall be issued a UCC 1 which shall be recorded by
the company in the amount of Nine Hundred Thousand Dollars ($900,000.00)
(collectively, the "Severance Payments") for the purpose of security in the
event of default under the provisions of this agreement. Upon payment in
full of all shares and money Executive shall release said lien.
(n) Except as provided in Article XI, this Agreement shall thereupon be of no
further force or effect. Any amounts due from Company pursuant above and
not paid to Executive as and when due shall accrue interest
at the prime rate of interest as established from time to time by Chase
Manhattan Bank of New York. Company may purchase insurance to cover all or
any part of its obligations set forth in this Section, and Executive agrees
to take a physical examination to facilitate the purchase of such
insurance.
7.7 Non-Renewal of Agreement: In the event that Company shall not have made a
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Qualifying Offer (as hereinafter defined) to Executive on or before the
Scheduled Termination Date of this Agreement, and no other agreement
between Executive and Company relating to the extension of Executive's
employment shall have been entered into by the Scheduled Termination Date,
Executive shall receive (after having given the Company written notice of
its failure to deliver a Qualifying Offer, and after not having received
such Qualifying Offer from the Company within five (5) business days from
the delivery of such notice to the Company) a contract termination payment
of $900,000.00 (the "Nonrenewal Payment") from the Company. Such
Nonrenewal Payment shall be due within sixty (60) days following the
Scheduled Termination Date of Executive's employment.
(a) Qualifying Offer: The term "Qualifying Offer" shall mean a written
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offer of employment to Executive which: (i) shall be for a period of
not less than five years from the Scheduled Termination Date, (ii)
shall include the types of compensation contained in this Agreement,
(iii) shall constitute a reasonable offer taking into account
Executive's compensation set forth in this Agreement; (iv) the
Company's financial and operating performance during the term of this
Agreement; (v) any other then-current circumstances relevant to the
determination of Executive's compensation by Company for the period
specified in (i); (vi) shall not contain any terms or provisions which
reduce Executive's title or duties as stated herein, and (vii) shall
state that it is irrevocable for 30 days from the date of delivery
thereof.
(b) In the event that the parties shall disagree as to whether or not an
offer timely made by Company in accordance with the foregoing
constitutes a Qualifying Offer, the parties shall submit such
disagreement to arbitration by a qualified individual executive
compensation expert of national reputation, who shall not have had
dealings with either party during the preceding five (5) years.
7.8 Constructive Termination: Prior to the expiration of the Term, Executive
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shall have the right to terminate his employment under this Agreement, upon
thirty (30) days' notice to the Company given within sixty (60) days
following the occurrence of any of the following events ("Constructive
Termination Events"); provided, however, that the Company shall have twenty
(20) days after the date such notice has been given to the Company in which
to cure the conduct or cause specified in such notice:
(a) A material breach by the Company of a material obligation of the Company
under this Agreement;
(b) A failure of the Company to pay when due to the Executive any annual base
salary, annual bonus or other earned bonus or awards or commissions
referred to in this Agreement;
(c) The relocation of the Executive's principal place of employment to a
location not within a 30 mile radius of such place of employment on the
Effective Date;
(d) A material reduction by the Company of the Executive's duties or
responsibilities;
(e) The failure of the Company to obtain an agreement reasonably satisfactory
to the Executive from any successor to assume and agree to perform this
Agreement, or, if the business for which the Executive's services are
principally performed is sold or transferred, the failure of the Company to
obtain such an agreement from the purchaser or transferee of such business;
or
(f) The Company shall fail to grant Executive's stock options for provided for
herein.
Following a Constructive Termination Event and proper notice by the Executive as
set forth herein, Executive may terminate his employment with the Company and
shall be entitled to receive the Severance Payments and the Nonrenewal Payment
as set forth in Sections 7.6 and 7.7 of this Agreement. In the event the
Executive terminates Executive's employment as a result of a Constructive
Termination Event and the Company objects in writing to the Executive's
determination that there was Constructive Termination Event within (30) days
after Executive has notified the Company of the same, the matter shall be
resolved by arbitration in accordance with the provisions of Section 7.2(c). If
the Company fails to object to any such determination of Constructive
Termination in writing within such thirty (30) day period, it shall be deemed to
have waived its right to object to that determination. If such arbitration
determines that there was not proper Constructive Termination, such termination
shall be deemed to be a termination pursuant to subsection 7.4(c).
7.9 Certain Payments: The parties believe that the payments to Executive
----------------
hereunder do not constitute "Excess Parachute Payments" under Section 28OG
of the Code. Notwithstanding such belief, if any payment or benefit under
this Agreement is determined to be an `Excess Parachute Payment," Company
shall pay Executive an additional amount (the "Tax Payment") such that (i)
the excess of all Excess Parachute Payments (including payments under this
sentence) over the sum of excise tax thereon under Section 4999 of the Code
and income tax thereon under Subtitle A of the Code and under applicable
state law is equal to (ii) the excess of all Excess Parachute Payments
(excluding payments under this sentence) over income tax thereon under
Subtitle A of the Code and under applicable state law.
ARTICLE VIII
Non-Competition and Non-Interference
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8.1 Non-Competition. Executive may advise, lend money, manage, control,
trade, sell, lease, license or otherwise own technology in any private company,
---------------
however, Executive's ownership interest may not directly or indirectly exceed
-------
20% of the total issued and outstanding shares of any one company whether said
company is or is not in direct competition with the Company. Employee shall be
permitted to own up to 5% of the issued and outstanding shares of capital stock
of any corporation which has a class of equity securities registered under
Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended.
8.2 Non-Interference. Employee agrees, that during the Term hereof and, in
the case of a Termination For Cause or a Termination Without Cause pursuant to
Section 7.2(d) hereof, for a period of one (6) months thereafter, Employee will
not, directly, indirectly or as an agent on behalf of or in conjunction with any
person, firm, partnership corporation or other entity, induce or entice any
employee of the Company to leave such employment or cause anyone else to do so.
Employee agrees to provide a non-event and comprehensive transition of his or
her responsibilities to any new Employee being brought in to the Company to
serve in the capacity of the departing employee.
8.3 Severability. If any covenant or provision contained in this Article
VIII is judicially determined to be void or unenforceable in whole or in part,
it shall not be deemed to affect or impair the validity of any other covenant or
provision. If, in any arbitration or judicial proceeding, a tribunal shall
refuse to enforce all of the separate covenants deemed included in this Article
VIII, then such unenforceable covenants shall be deemed eliminated from the
provisions hereof for the purpose of such proceedings to the extent necessary to
permit the remaining separate
covenants to be enforced in such proceedings.
ARTICLE IX
Remedies
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9.1 Equitable Remedies. Executive and the Company agree that the services
to be rendered by Executive pursuant to this Agreement, and the rights and
interests granted and the obligations to be performed by Executive to the
Company pursuant to this Agreement, are of a special, unique, extraordinary and
intellectual character, which gives them a peculiar value, the loss of which
cannot be reasonably or adequately compensated in damages in any action at law,
and that a breach by Company of any of the terms of this Agreement will cause
the Employee great and irreparable injury and damage. Employee and hereby
expressly agrees that the each shall be entitled to the remedies of injunction,
specific performance and other equitable relief to prevent a breach of Articles
VI and VIII of this Agreement, both pendente lite and permanently, as such
breach would cause irreparable injury to each and a remedy at law would be
inadequate and insufficient. Therefore, the parties may in addition to pursuing
other remedies, obtain an injunction from any court having jurisdiction in the
matter restraining any further violation.
9.2 Rights and Remedies Preserved. Nothing in this Agreement shall limit
any right or remedy the Company or Employee may have under this Agreement or
pursuant to them, for any breach of this Agreement by the other party. The
rights granted to the parties herein are cumulative and the election of one
shall not constitute a waiver of such party's right to assert all other legal
remedies available under the circumstances.
ARTICLE X
Miscellaneous
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10.1 No Waivers. The failure of either party to enforce any provision of
this Agreement shall not be construed as a waiver of any such provision nor
prevent such party thereafter from enforcing such provision or any other
provision of this Agreement.
10.2 Notices. Any notice to be given to the Company and Employee under the
terms of this Agreement may he delivered personally, by telecopy, telex or other
form of written electronic transmission, or by registered or certified mail,
postage prepaid, and shall be addressed as follows:
If to the Company: OrbitTravel .com Corporation
X/X Xxxxxx Xxxxxxx, Xxxxx 00-X
One Union Square Station
New York, New York
Attention: CEO
With a Copy to: Xxxxx X. Brand, Esq.
Brand & Brand
000 Xxxx Xxxx Xxxx, Xxxxxxxxx Xxxxx
Xxxxxx Xxxx, Xxx Xxxx 00000
If to Employee: Xxxxxxx X. Xxxxxxxxx
00 Xxxxx Xxxxx Xxxx
Xxxxxxx, Xxx Xxxx 00000
Either party may hereafter notify the other in writing of any change in address.
Any notice shall be deemed duly given (1) when personally delivered, (ii) when
telecopied, telexed or transmitted by other form of written electronic
transmission (upon confirmation of receipt) or (iii) on the third day after it
is mailed by registered or certified mail, postage prepaid, as provided herein.
10.3 Severability. The provisions of this Agreement are severable and if
any provision of this Agreement shall be held to be invalid or otherwise
unenforceable, in whole or in part, the remainder of the provisions, or
enforceable parts thereof, shall not be affected thereby.
10.4 Successors and Assigns. The rights and obligations of the Company
under this Agreement shall inure to the benefit of and be binding upon the
successors and assigns of the Company, including the survivor upon any merger,
consolidation, share exchange or combination of the Company with any other
entity. Employee shall not have the right to assign, delegate or otherwise
transfer any duty or obligation to be performed by him hereunder to any person
or entity.
10.5 Entire Agreement. This Agreement supersedes all prior and
contemporaneous agreements and understandings between the parties hereto, oral
or written, and may not be modified or terminated orally- No modification,
termination or attempted waiver shall be valid unless in writing, signed by the
party against whom such modification, termination or waiver is sought to be
enforced. This Agreement was the subject of negotiation by the parties hereto
and their counsel. The parties agree that no prior drafts of this Agreement
shall be admissible as evidence (whether in any arbitration or court of law) in
any proceeding which involves the interpretation of any provisions of this
Agreement.
10.6 Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York without reference to
the conflict of law principles thereof.
10.7 Section Headings. The section headings contained herein are for the
purposes of convenience only and are not intended to define or limit the
contents of said sections.
10.8 Attorneys Fees. In the event of any litigation arising out of this
Agreement, the prevailing party shall be entitled to recover from the non-
prevailing party reasonable attorneys fees and costs incurred.
10.9 Further Assurances. Each party hereto shall cooperate and shall take
such further action and shall execute and deliver such further documents as may
be reasonably requested by the other party in order to carry out the provisions
and purposes of this Agreement.
10.10 Gender. Whenever the pronouns "he" or "his" are used herein they
shall also be deemed to mean "she'' or "hers" or "it" or "its" whenever
applicable. Words in the singular shall be read and construed as though in
the plural and words in the plural shall be read and construed as though in
the singular in all cases where they would so apply.
10.11 Counterparts. This Agreement may be executed in counterparts, all of
which taken together shall be deemed one original.
ARTICLE XI
Survival
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11.1 Survival. The provisions of Articles VI, VII, VIII, IX and X, of this
Agreement shall survive the termination of this Agreement whether upon, or prior
to, the Scheduled Termination Date hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Employment
Agreement as of the date first above written.
XxxxxXxxxxx.xxx Corporation
a Delaware Corporation
By: /s/ Xxxxx X. Xxxxxxxx By: /s/ Xxxxxx X. Xxxxxxx
----------------------------- -----------------------------
Xxxxx X. Xxxxxxxx Title Chairman & CEO
Vice Chairman & Vice President
/s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------
XXXXXXX X. XXXXXXXXX, Employee
