CONSULTING AND NONCOMPETITION AGREEMENT
This is a Consulting and Noncompetition Agreement (this "Agreement") dated
December 31, 1996, among Florida Gaming Centers, Inc., a Delaware Corporation
(the "Company") and Xxxxxxx X. Xxxxxxx (the "Consultant").
RECITALS
A. The Company is purchasing the assets of WJA Realty Limited
Partnership, a Massachusetts limited partnership ("Seller") pursuant to an
Assets Purchase Agreement dated as of November 20, 1996 (the "Purchase
Agreement"), between Florida Gaming Corporation ("FGC"), the Company and Seller.
All capitalized terms used, but not defined herein shall have the meanings
assigned to them in the Purchase Agreement.
B. Following the Company's purchase of the Assets, the Company wishes to
benefit from the Consultant's experience and knowledge by utilizing him as a
consultant to the Company, and the Company further wishes to prevent Consultant
from competing with the Company subject to the terms and conditions set forth
herein.
TERMS AND CONDITIONS
1. CONSULTING SERVICES. In consideration of the Company's purchase of
the Assets from Seller and the payment by the Company to the Consultant of
$20,000.00 per month for each of the sixty months following the date hereof, the
Consultant agrees for a period of five years from the date hereof to provide
such consulting services as may reasonably be requested by officers or directors
of the Company, including, without limitation, (i) advising the Company
regarding the operations of the business; (ii) advising the Company regarding
its marketing and promotional plans and activities; (iii) participating in the
preparation of competitive analyses; (iv) advising the Company regarding
political matters (v) assisting with Corporate expansion and business
development programs. Notwithstanding the foregoing, the Consultant shall be
obligated to assist and advise the Company sixty hours per month (but no more)
to the extent he is requested to do so by officers or directors of the Company.
2. INSURANCE. The Company will pay the premiums for Consultant's life
insurance policy with Xxxx Xxxxx Insurance Company for the term of this
Agreement. The premium obligation of the Company for the Consultant's life
insurance policy will not exceed $14,000 per annum. During the term of this
Agreement, the Company shall provide the Consultant with coverage under the
group health insurance plan in effect from time to time for the Company's
employees (the "Plan") on the same terms and conditions that the Company
generally provides such insurance to its employees from time to time; provided,
that the Company shall have no obligation to provide the Consultant with health
insurance except to the extent that the Plan permits the Company to do so under
the Plan.
3. STOCK OPTION. Concurrent with the purchase of the Assets, and the
execution of this Agreement, the Company will cause FGC to grant Consultant an
option to purchase 50,000 shares of the common stock of FGC pursuant to an
option agreement between the Company and the
Consultant in the form of Attachment A hereto. The exercise price shall be the
market price at the close of business on the Closing Date. The option shall be
exerciseable at any time within five years of the Closing.
4. COVENANTS OF THE CONSULTANT. In further consideration for the
Company's purchase of the Assets and the payments to be made to the Consultant
hereunder, the Consultant covenants and agrees as follows:
(a) COVENANT NOT TO COMPETE. During the term of this Agreement,
except for the services to be rendered by the Consultant under this Agreement,
the Consultant shall not, directly or indirectly, either individually or as an
employee, agent, partner, shareholder, investor, director, consultant or in any
other capacity (i) participate or engage in, or assist others in participating
or engaging in, a parimutuel or gaming business within 75 miles of any of the
jai-alai frontons located in Miami, Ft. Xxxxxx, Tampa, and Ocala, Florida; or
(ii) solicit, or assist others in soliciting, any employees of Company from
leaving their employ (including the current and former employees of Seller).
(b) CONFIDENTIALITY. The Consultant shall not communicate, disclose
or use for the benefit of himself or any other person, firm, partnership,
corporation or other entity (a "Person") in any way, or anywhere, any customer
or supplier lists, business secrets or methods, business policies, manuals of
instruction, reports, research, records, catalogs, samples, advertising,
brochures, or other forms, or any other confidential or proprietary information
or trade secrets of any type or description whatsoever belonging to the Company,
including, without limitation, those formerly belonging to Seller which are
being purchased by the Company pursuant to the Purchase Agreement ("Confidential
Information"). The Consultant acknowledges that to the best of his knowledge,
after due investigation, he has delivered to the Company all documents,
memoranda, notes, and other writings whatsoever (and all copies thereof)
prepared by the Consultant or otherwise, which contain or relate to Confidential
Information (the "Confidential Documents") which were in his possession or
control whether prepared by the Consultant or otherwise. Should the Consultant
discover that he does have possession or control of any Confidential Documents,
he shall immediately deliver them to the Company.
(c) REASONABLENESS OF COVENANTS. It is expressly understood and
agreed that although the Company and the Consultant consider the covenants
contained in this paragraph 4 to be reasonable for the purpose of preserving the
Company's proprietary rights and ongoing business value including, without
limitation, such rights and value transferred to the Company pursuant to the
Purchase Agreement, if a final judicial determination is made by a court having
jurisdiction that the time or territory or any other restriction contained in
this paragraph 4 is an unenforceable restriction against the Consultant, the
provisions of such restriction shall not be rendered void but shall be deemed
reduced as to a duration or scope or otherwise amended to such extent as such
court may judicially determine or indicate to be reasonable. Alternatively, if
the court referred to above finds that any restriction contained in this
paragraph 4 is unenforceable, and such restriction cannot be amended so as to
make it unenforceable, such finding shall not affect the enforceability of any
of the other restrictions contained herein.
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5. REMEDIES. The Consultant acknowledges that the Company has
consummated the transactions contemplated in the Purchase Agreement in reliance
upon Consultant's fulfillment of the obligations imposed by this Agreement. The
Consultant agrees that the Company may not be adequately compensated by money
damages for a breach by the Consultant of any of the covenants contained herein,
and the Consultant agrees that the Company shall be entitled, in addition to all
other remedies, to injunctive relief and specific performance of this Agreement.
The parties further agree that, if the Company reasonably determines that the
Consultant has breached any of his covenants contained herein, in addition to
all other remedies, the Company shall have the right to set off the amount of
any damages which it sustains as a result of such breach against any amounts the
Company owes to the Consultant, including, without limitation, any payments owed
to Seller pursuant to the Purchase Agreement.
6. REIMBURSEMENT OF EXPENSES. The Company shall reimburse the Consultant
for all reasonable travel, entertainment, and similar expenses that the Company
directs the Consultant to incur in connection with the provision of consulting
services under this Agreement. The Company shall not reimburse any expense that
is not specifically approved by the Company before it is incurred. Any
reimbursements under this paragraph shall be made upon the Consultant's
presentation to the Company, from time to time, of an account of such expenses
in such form and in such detail as the Company may reasonably request.
7. HOLD HARMLESS FROM AGREEMENT WITH SELLER. The Consultant has been an
employee of the Seller for a number of years. The Consultant represents and
warrants to the Company that (i) he has not received compensation from the
Seller in the last six months in excess of the Consultant's base salary plus
benefits listed in the schedules to the Purchase Agreement, (ii) he has not
received in the last six months any bonus, (iii) he is not entitled to any bonus
from Seller with respect to all or any part of calendar year 1996 or any period
thereafter, (iv) he is not entitled to any severance payment from Seller or any
similar benefit, and (v) the Seller owes nothing to the Consultant other than
the Consultant's base pay for the days completed in the current pay period. The
Consultant shall indemnify and hold the Company harmless against any losses it
incurs as a result of any inaccuracy in any of the foregoing representations and
warranties. The Company may setoff the amount of any such losses against
amounts that would otherwise be payable to the Consultant under this Agreement.
8. MISCELLANEOUS.
(a) ASSIGNABILITY. The services to be rendered by the Consultant
under this Agreement are unique and personal, and the Consultant may not assign
any of his rights or delegate any of his duties under this Agreement. The
rights or obligations of the Company under this Agreement shall benefit and bind
the successors and assigns of the Company.
(b) GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Florida.
(c) ENTIRE AGREEMENT. This Agreement and the accompanying Option
Agreement constitute the entire agreement of the parties and supersedes all
prior understandings
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with respect to the subject matter hereof. No change in or modification of this
Agreement shall be enforceable, unless in writing and signed by the party
against whom enforcement is sought.
(d) INDEPENDENT CONTRACTOR. The parties acknowledge and agree that
the Consultant shall perform his consulting services hereunder as an independent
contractor and not as an employee of the Company. The Consultant shall not
have, receive or be entitled to receive under this Agreement any of the rights,
privileges, or benefits of employees of the Company.
(e) SEVERABILITY. If any provision of this Agreement or the
application thereof shall be adjudged by any court of competent jurisdiction to
be invalid, illegal, or unenforceable in any respect, the validity, legality,
and enforceability of all other applications of such provision, and of all other
provisions and applications hereof, shall not in any way be affected or impaired
unless such provision is of the essence of this Agreement.
(f) NO WAIVERS. No failure or delay on the part of any party
exercising any power or right under this Agreement shall operate as a waiver
thereof, and no single or partial exercise of any such right or power shall
preclude any other or further exercise thereof, or the exercise of any other
right or power under this Agreement.
(g) HEADINGS. The headings used in this Agreement have been included
solely for ease of reference and shall not be deemed a part of this Agreement in
construing or interpreting the provisions hereof.
(h) COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original. It shall not be
necessary in making proof of this Agreement or the terms hereof to produce or
account for more than one such counterpart.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date
first set forth above.
Florida Gaming Centers, Inc. Consultant
Name:
By ------------------------------
--------------------------------- Xxxxxxx X. Xxxxxxx
Title: Signature:
----------------------------- -------------------------
Date: Date:
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