Employment Agreement
with Xxxxxx X. Xxxxx
10.18
EMPLOYMENT AGREEMENT
(and Agreement to serve as a Director)
THIS EMPLOYMENT AGREEMENT, made as of this 27th day of January, 1997, by
and between:
FIDELITY HOLDINGS, INC., a Nevada corporation having its executive
office at 00-00 Xxx Xxxxxxx Xxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxx Xxxx 00000
(hereinafter referred to as "EMPLOYER")
AND
XXXXXX X. XXXXX, an adult individual residing at 000 Xxxxxxx Xxxx,
Xxxxxxxxxx, Xxxxxxxxxxx 00000 (hereinafter referred to as "EMPLOYEE")
WITNESSETH THAT:
WHEREAS, EMPLOYEE has certain education, experience, background and
contacts which would be useful and helpful to EMPLOYER in its business and
EMPLOYER is desirous of employing EMPLOYEE in order to obtain the benefits of
such education, experience, background and contacts;
WHEREAS, EMPLOYEE is agreeable to being hired by EMPLOYER as an employee
and providing the benefits of his education, experience, background and contacts
to EMPLOYER;
WHEREAS, the parties have agreed upon the terms of such employment and
desire a written, formal contract to evidence their agreements;
NOW, THEREFORE, in consideration of the mutual promises, covenants and
forbearances contained herein, and intending to be legally bound, the parties
have agreed as follows:
1. EMPLOYMENT. For the term provided in Paragraph 2, EMPLOYER hereby
employs EMPLOYEE, and EMPLOYEE hereby accepts that employment, upon the terms
and conditions hereinafter set forth.
2. TERM.
(a) This Agreement shall become effective as of 12:01 am, January 27,
1997.
(b) This Agreement, subject to the provisions of Paragraphs 14 and 15
below, shall continue and exist for an initial period from January 27, 1997 to
December 31, 1999.
(c) EMPLOYER shall have the option to extend the term of this Agreement
for an additional one (1) year period, i.e., to December 31, 2000. Such option
shall be exercised by EMPLOYER mailing notice to EMPLOYEE on or before September
30, 1999, of its intention to so extend the Agreement. If EMPLOYER shall not
exercise its extension option by September 30, 1999, this Agreement shall
terminate on December 31, 1999.
(d) EMPLOYER shall have an additional option to extend the term
of this Agreement for a further one (1) year period, i.e., to December 31, 2001.
Such option shall be exercised by EMPLOYER mailing notice to EMPLOYEE on or
before September 30, 2000, of its intention to so extend the Agreement. If
EMPLOYER shall not exercise its extension option by September 30, 2000, this
Agreement shall terminate on December 31, 2000.
(e) Notwithstanding the foregoing, the term of this Agreement is
otherwise subject to the termination provisions contained hereafter.
3. COMPENSATION-BASE.
(a) For all services rendered under this Agreement, EMPLOYEE shall be
paid, as base compensation, such annual fee as shall be determined by the
President/CEO and Management of EMPLOYER, from time to time, but in no event
shall such compensation be at a rate of less than $100,000 per year. In the
event of any extension of this Agreement, such compensation shall be at a rate
of no less than $100,000 per year during each extension year. All such
compensation shall be subject to a Cost-of-Living Adjustment (COLA) annually
based upon the percentage increase in the Cost-of-Living Index, All Commodities,
for the New York City area. Subject to sub-paragraphs (b) and (c) below, such
compensation is to be payable in equal installments at intervals no longer than
semi-monthly. Such base compensation shall be in addition to such fringe
benefits and bonuses as provided elsewhere herein.
(b) EMPLOYEE acknowledges that EMPLOYER is seeking the funding of the
working capital for the operations of EMPLOYER and the entire Plastics and
Utility Products Division of Fidelity Holdings, Inc. Accordingly, regular
semi-monthly compensation shall not commence until thirty (30) days after
effectiveness of the proposed Registration Statement being filed with the
Securities and Exchange Commission. Until such time, all compensation due
hereunder shall be accrued, subject, nevertheless, to periodic "draws" against
such accru ' al to be made by EMPLOYER as its financial circumstances will
permit.
(c) For compensation purposes, EMPLOYER shall assign EMPLOYEE to its
divisional subsidiary, "Xxxxx-Plast, Inc.", which is the head of the "Plastics
and Utility Products Division" and, provided that such assignment does not
require relocation, may assign EMPLOYEE to EMPLOYER may assign EMPLOYEE to one
or more of its subsidiaries and/or affiliates, to perform services consistent
with EMPLOYEE'S duties hereunder. In such event, EMPLOYEE may be separately
compensated by each such subsidiary and/or affiliate. All such compensation
shall be deducted from the compensation payable under sub-paragraph (a) above
and EMPLOYER shall pay EMPLOYEE only the difference between (i) the total of all
such compensations from subsidiaries and/or affiliates and (ii) the base
compensation. No assignment hereunder for compensation purposes shall require
that EMPLOYEE physically relocate.
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(d) The base compensation for each year of this Agreement, including any
extensions to this Agreement, shall be subject to a retroactive increase, based
upon an earnings per share formula (earnings of the "Plastics and Utility
Products bivision" on a consolidated basis divided by actual common shares of
EMPLOYER's public company parent issued and outstanding at December 31 of each
year, and not fully diluted) as follows:
Profits Per Increase as a
Common Share Percent of Base Compensation
$.OO - $.10 5%
$.ll - $.20 10%
$.21 - $.30 20%
$.31 - $.40 30%
$.41 - $.50 40%
$.51 - $.60 50%
$.61 - $.70 70%
$.71 - $.80 90%
$.81 - $.90 110%
$.91 - $1.00 130%
over $1.00 150%
This retroactive increase, if any should occur, is not a bonus but a merit
adjustment to the base compensation, and shall be based on the COLA-adjusted
base compensation in effect for the prior year. The calculation shall be made
based upon the annual audit of EMPLOYER's financial statements and shall be paid
in equal amounts for the balance of the then current year on the regular
paydays, commencing with the first payday following release of the audit. Any
retroactive increase shall not affect the baseline for subsequent calculations.
It is a separate adjustment from any other adjustment under any other plan.
(e) At the end of each calendar year, the President/CEO and Management
of EMPLOYER shall review the performance of EMPLOYEE for such year and, based
upon such evaluation, establish any increase in the base compensation payable to
EMPLOYEE for the succeeding calendar year, as COLA adjusted by sub-paragraph (a)
above. EMPLOYER shall not be obligated to provide any increase, in excess of the
increase in the Cost-of-Living Index, All Commodities, for the New York City
area during the prior calendar year.
4. COMPENSATION-FRINGE BENEFITS. EMPLOYEE shall receive at least the
following additional benefits, which may be extended or increased, but not
reduced, by EMPLOYER:
(a) Vacation - During the first year of this Agreement, EMPLOYEE shall
be entitled to paid vacation of three (3) weeks and during the second and any
extension year of this Agreement shall be entitled to paid vacation of four (4)
weeks, which shall not be accumulated from year to year if unused. EMPLOYEE
shall not be compensated for any unused vacation time.
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(b) Personal Leave - During each year of this Agreement, EMPLOYEE shall
receive ten (10) days paid personal leave, which shall not be accumulated from
year to year if unused. EMPLOYEE shall not be compensated for any unused
personal leave. "Personal leave" shall include sick leave and all other personal
time off not otherwise provided for.
(c) Automobile - During the term of this Agreement, EMPLOYER shall
provide EMPLOYEE with a car allowance of $500.00 per month. EMPLOYEE shall be
responsible for all purchase or lease costs and all costs for garaging, repairs,
maintenance, insurance, fuel, oil, and supplies. This amount shall commence with
the effective date of this Agreement and shall not be accrued.
(d) Health Insurance - During the term of this Agreement, EMPLOYER
shall provide EMPLOYEE with an allowance of $400.00 per month for the payment of
health insurance premiums. EMPLOYEE shall be responsible for all costs in excess
of such allowance. This amount shall commence with the effective date of this
Agreement and shall not be accrued.
(e) Other - EMPLOYEE shall receive such other medical, surgical,
hospital, dental or legal insurance and fringe benefits as are available to any
other officers/employees/consultants, consistent with EMPLOYERIS past practices
and such life/disability insurance, incentive or deferred compensation or
bonuses, pension/profit sharing plan and qualified and non-qualified stock
option plans as the Board of Directors of EMPLOYER shall establish. Nothing
contained in this Agreement shall be in lieu of any rights, benefits and
privileges to which EMPLOYEE may be entitled under any retirement, pension,
profit-sharing, insurance, hospital or other plans which may now be in effect or
which may hereafter be adopted. EMPLOYEE shall have the same rights and
privileges to participate in such plans and benefits as any other employee
during his period of employment.
5. COMPENSATION-BONUS. After the end of each calendar year, the
President/CEO and Management of EMPLOYER shall determine the net profits before
taxes of EMPLOYER for such prior year and shall determine any bonus for such
year payable to EMPLOYEE. EMPLOYER shall not be obligated to provide any bonus.
Any bonus awarded shall be paid at such time or times, in such amounts or
installments, as the President/CEO and Management may determine.
6. DUTIES. (a) EMPLOYEE is engaged as the Chief Executive Officer of
EMPLOYER's "Plastics and Utility Products Division" under the Florida
corporation "Xxxxx-Plast, Inc." and, subj ect to the direction and approval of
EMPLOYER's President/CEO and Management, shall establish, supervise and manage
that division. EMPLOYEE shall provide advice and assistance to EMPLOYER's
officers, directors and key management. In cooperation with, and subject to,
EMPLOYER's President/CEO and Management, EMPLOYEE shall develop a divisional
developmental budget and forecast, including the acquisition,
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development, testing, production/manufacture and sales/marketing/distribution of
divisional products and shall develop, for approval by EMPLOYER's President/CEO
and Management, an annual budget and forecast for the Plastics and Utility
Products Division. EMPLOYEE'S performance shall be subject to the supervision of
EMPLOYERIS President/CEO and Management. The precise consulting scope and the
specific services to be rendered by EMPLOYEE may be defined, interpreted,
curtailed, or extended, from time to time, by determination of the President/CEO
of EMPLOYER, provided, however, that any definition, interpretation,
curtailment, or extension is consistent with the status of, and/or educational
experience required for, the responsibilities for which EMPLOYEE has been
initially engaged hereunder. It is the intent of this provision to provide
EMPLOYER with flexibility in assigning responsibilities to EMPLOYEE and this
provision shall not be used to discipline, embarrass, humiliate or harass
EMPLOYEE. (b) In addition, at the option of EMPLOYER's management, and subject
to the approval of the EMPLOYER's shareholders, during the term of this
Agreement EMPLOYEE shall, from time to time, serve as a director of the EMPLOYER
if so elected. If elected to serve as a director, EMPLOYEE shall be indemnified
by EMPLOYER and shall receive the benefits of any O&D insurance. Removal and/or
failure to elect or reelect EMPLOYEE as a director shall not be a breach of this
Employment Agreement.
7. EXTENT AND PLACE OF SERVICES. (a) Except as provided in subparagraph
(b) below, EMPLOYEE agrees that this employment constitutes his primary
employment and understands that his primary loyalty and responsibility is to
EMPLOYER. Accordingly, except as provided in subparagraph (b) below, EMPLOYEE
shall devote such adequate, reasonable, and proper time, attention, and energies
to the business of EMPLOYER as shall be necessary or consistent with such
understanding and EMPLOYEE shall not, during the term of this Agreement be
engaged in any other business activity (whether or not such business activity is
pursued for gain, profit, or other pecuniary advantage), which conflicts with
EMPLOYEE's employment responsibilities hereunder, without prior, written
authorization of EMPLOYER's President/CEO and Management. , However, nothing
contained herein shall be construed as preventing EMPLOYEE from investing his
assets in such form or manner as EMPLOYEE may select, whether or not such
investment will require any services on EMPLOYEE'S part in the operation of the
affairs of the companies in which such investments are made.
(b) EMPLOYER acknowledges awareness that EMPLOYEE owns and operates a plastics
industry consulting firm called "X.X. Xxxxx & Associates". EMPLOYEE may continue
to own and operate such enterprise, provided that EMPLOYEE shall devote at least
forty (40) hours per week to his duties under his Employment Agreement.
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8. WORKING FACILITIES. EMPLOYEE shall be furnished, at the expense of
EMPLOYER, with all necessary working facilities, including but not limited to an
equipped office, clerical help, and telephone/facsimile/copying services,
suitable to his position and adequate for the performance of his duties.
9. EXPENSES. EMPLOYEE is not authorized to incur expenses on behalf
of, or chargeable to, EMPLOYER, with respect to his business travel, including
transportation, lodging, food, entertainment, etc. except within such
guidelines as may be established from time to time by the President/CEO and
Management of EMPLOYER. EMPLOYER shall reimburse EMPLOYEE for authorized
expenses within such guidelines upon presentation by EMPLOYEE, from time to
time, of an itemized account of such expenditures in such form as EMPLOYER may
require, together with receipts or other proofs of the expenditures as may be
required.
10. OWNERSHIP OF INVENTIONS AND DEVELOPMENTS. (a) For purposes of this
Agreement, the following definitions shall apply:
(i) "Inventions" shall mean:
(A) All inventions, improvements, modifications, and enhancements,
whether or not patentable, made by EMPLOYEE during EMPLOYEE's employment by
EMPLOYER; and
(B) All inventions, improvements, modifications and enhancements
made by EMPLOYEE, during a period of one (1) year after any suspension or
termination of EMPLOYEE's employment by EMPLOYER, which relate, directly or
indirectly, to the past, present or then current business of the EMPLOYER.
(ii) "Work Product" shall mean all documentation, software, creative
works, programs, systems, source codes, Hardware Signatures, know-how and
information created, in whole or in part, by EMPLOYEE during EMPLOYEE's
employment by EMPLOYER, whether or not copyrightable or otherwise protectable,
excluding Inventions.
(iii) "Trade Secrets" shall mean all documentation, software, know-how
and information relating to the past, present and then current business of the
EMPLOYER, any intended business of EMPLOYER of which EMPLOYEE has knowledge, or
any plans therefor, or relating to the past, present or then current business of
a third party or plans therefor that are disclosed to the EMPLOYER, which the
EMPLOYER does not disclose to third parties without restrictions on use or
further disclosure.
(b) To provide a benchmark, EMPLOYEE represents and warrants that as of
the execution of this Agreement there are no Inventions or Work Products
developed by EMPLOYEE which the EMPLOYEE asserts are to be excluded from the
provisions of this Paragraph 10.
(c) EMPLOYEE shall promptly disclose to EMPLOYER all Inventions and
keep accurate records relating to the conception and reduction to practice of
all Inventions. Such records shall be the sole and exclusive property of
EMPLOYER, and the EMPLOYEE shall surrender
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possession of such records to the EMPLOYER upon any suspension or termination of
EMPLOYEE's employment with the EMPLOYER.
(d) EMPLOYEE hereby assigns to the EMPLOYER, without further
consideration to the EMPLOYEE, the entire right title and interest in and to the
Inventions and Work Product and in and to all proprietary rights therein or
based thereon. EMPLOYEE agrees that the Work Product shall be deemed to be a
"work made for hire". EMPLOYEE shall execute all such assignments, oaths,
declarations and other documents as may be prepared by EMPLOYER to effect the
foregoing.
(e) EMPLOYEE shall provide EMPLOYER with all reasonable information,
documentation, and assistance EMPLOYER may request to perfect, enforce, or
defend the proprietary rights in or based on the Inventions, Work Product or
Trade Secrets. EMPLOYER, in its sole discretion, shall determine the exact
extent of the proprietary rights, if any, to be protected in or based on the
Inventions and Work Product. All such information, documentation and assistance
shall be provided at no additional expense or cost to the EMPLOYER, except for
out-of-pocket expenses which the EMPLOYEE incurs at the EMPLOYER's request.
(f) In the event of termination of this Employment Agreement, EMPLOYER
shall be entitled to advise any new employer of EMPLOYEE of his rights and
obligations hereunder for a period of one year following termination of this
Employment Agreement.
11. NON-DISCLOSURE OF INFORMATION. (a) EMPLOYEE recognizes and
acknowledges that, during the course of his employment, he will have access to
valuable proprietary information, including, but not limited to Inventions, Work
Product and/or Trade Secrets, contractual arrangements and compensation
arrangements with sub-contractors and customers of EMPLOYER; compensation
arrangements with sub contractors, vendors, and outside personnel; costing,
pricing and bidding methods, procedures, and amounts; management and operating
procedures and software; management information systems, etc.; marketing plans
and strategy; personnel policies and contractual arrangements, including job
assignments and compensation; customer leads; customer lists; and that such
information constitutes unique assets of the business of EMPLOYER and of which
EMPLOYER is the sole and exclusive owner. EMPLOYEE will treat such proprietary
information on a confidential basis and will not, during or after his
employment, personally use or disclose all, or any part of, such proprietary
information to any person, firm, corporation, association, agency, or other
entity except as properly required in the conduct of the business of EMPLOYER,
or except as authorized in writing by EMPLOYER, publish, disclose or authorize
anyone else to publish or disclose, any secret or confidential matter relating
to any aspect of the business of EMPLOYER with which EMPLOYEEIS service may in
any way acquaint EMPLOYEE. EMPLOYEE shall surrender possession of all
proprietary information, including especially all Trade Secrets, to EMPLOYER
upon any suspension or termination of
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EMPLOYEE's employment with the EMPLOYER. In the event of a breach, or threatened
breach, by EMPLOYEE, of the provisions of this Paragraph, EMPLOYER shall be
entitled to a preliminary, temporary and permanent injunction restraining
EMPLOYEE from disclosing in whole or in part, any such proprietary information
and/or form rendering any services to any person, firm, corporation,
association, agency, or other entity to whom such information, in whole or in
part, has been disclosed or is threatened to be disclosed. Furthermore, nothing
herein shall be construed as prohibiting EMPLOYER from pursuing any other
equitable or legal remedies available to it for such breach or threatened
breach, including the recovery or damages from EMPLOYEE. (b) EMPLOYER recognizes
that the EMPLOYEE may possess proprietary information of third parties and that
EMPLOYEE may have ongoing obligations to third parties with respect thereto.
EMPLOYER expressly requires that EMPLOYEE shall honor such ongoing obligations
to such third parties and that the EMPLOYEE shall not use, for the benefit of
EMPLOYER, or disclose to EMPLOYER, any such proprietary information.
12. RESTRICTIVE COVENANT. (a) During the term of this Agreement and for
a period of twelve (12) months after the termination of this Agreement and any
extension thereof, EMPLOYEE will not, within the United States or any other area
of the world in which EMPLOYER is then operating, directly or indirectly,
compete with, own,, manage, operate, control, be employed by, consult for,
participate in, perform services for, or be connected in any manner with the
ownership, management, operation or control of any business similar to the type
of business conducted by EMPLOYER at the time of the termination of this
Agreement. EMPLOYEE shall not, directly or indirectly, compete with any products
or services marketed or offered by EMPLOYER at the time of termination, or
engage in any activities which could be deemed a conflict of interest.
(b) EMPLOYEE agrees that the "time", "geographic area", and "Scope of
Business" provisions of this restrictive covenant are reasonable and proper and
have been specifically negotiated in connection with his employment and
compensation hereunder.
(c) EMPLOYER and EMPLOYEE agree, that if any court of competent
jurisdiction shall, for any reason, conclude that any portion of this covenant
shall be too restrictive, the court shall determine and apply lesser
restrictions, it being the intent of the parties that some such restrictions
shall be applicable for the protection of EMPLOYER and its shareholders.
(d) Notwithstanding the foregoing, EMPLOYEE's continuation of the
businesses of X.X. Xxxxx & Associates, as provided in Paragraph 7(b) shall not
constitute a violation of the provisions of this restrictive covenant, provided
that such business is not expanded into competition with EMPLOYER.
13. NONSOLICITATION COVENANT. (a) For a period of twelve (12
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months after the termination of this Agreement (including any extension thereof)
(the "Post Termination Period") EMPLOYEE shall not, solicit, directly or
indirectly, by any means, any of the clients, accounts, employees or "leads" of
EMPLOYER during the Post Termination Period.
(b) EMPLOYER and EMPLOYEE agree, that if any court of competent
jurisdiction shall, for any reason conclude that any portion of this covenant
shall be too restrictive, the court shall determine and apply lesser
restrictions, it being the intent of the parties that some such restrictions
shall be applicable for the protection of EMPLOYER and its shareholders.
(c) This covenant has been given to induce EMPLOYER to enter into this
Agreement and provide EMPLOYEEIS job responsibilities and compensation.
14. DISABILITY. (a) If the EMPLOYEE is unable to perform his services
by reason of illness or incapacity for a period of more than twenty-one (21)
consecutive work days, or more than four (4) weeks in any two-month period, the
compensation otherwise payable to him thereafter during the continued period of
such illness or incapacity may, at the option of EMPLOYER be reduced by 40%. If
such illness or incapacity shall continue for a period of more than six (6)
consecutive weeks, or more than 50% of the time in any one year, such
compensation may, at the option of EMPLOYER, be stopped altogether. The
EMPLOYEE'S full compensation shall be reinstated upon his return to employment
and the discharge of his full duties hereunder. Notwithstanding anything herein
to the contrary, EMPLOYER may, at its option, terminate this Agreement at any
time after the EMPLOYEE shall be absent from his employment, for whatever cause,
for a continuous period of more than six (6) months, and all obligations of
EMPLOYER hereunder shall cease upon any such termination.
(b) At any time, and from time to time, EMPLOYER may purchase
disability insurance to compensate EMPLOYEE during periods of disability, either
pursuant to sub-paragraph 4(d) or otherwise. In the event that such insurance is
purchased, during any period for which benefits are being paid by such insurance
sub-paragraph (a) above shall be inapplicable. In lieu thereof, EMPLOYER shall
compensate EMPLOYEE at the agreed base compensation rate less the benefits paid
by such insurance.
15. SUSPENSION. As used in this Agreement, the term "suspension" shall
mean:
(a) uncompensated military leave;
(b) uncompensated extended personal leave, authorized by EMPLOYER;
(c) temporary discontinuance of compensation due to disability, whether
or not compensated; and
(d) temporary discontinuance of employment, without termination, for
the convenience of either of the parties.
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16. TERMINATION. (a) EMPLOYER can terminate EMPLOYEE employment at any
time for good cause. Without intending to limit the definition of good cause
hereby, good cause will include:
(1) the EMPLOYEEIS death;
(2) the occurrence of one of the following events:
(i) EMPLOYEE commits, is arrested, or is officially charged with a f
elony or any crime involving moral turpitude or unethical conduct which in the
good faith opinion of the EMPLOYER could impair his ability to perform his
duties; and
(ii) in the good faith opinion of the President/CEO and Management, the
EMPLOYEE fails to fully and faithfully perform his obligations under this
Employment Agreement, and does not cure such failure within ten (10) working
days after receipt of notice of any failure.
(b) The termination of EMPLOYEEIS services shall not constitute a
termination of the restrictive obligations and duties under Paragraphs 10, 11,
12 and 13, except as otherwise provided in this Employment Agreement.
(c) In the event of the bankruptcy (Chapter 7), reorganization (Chapter
11) or other termination of the business of the EMPLOYER or of any subsidiary on
which EMPLOYEEIS continued employment and compensation is dependent, the
provisions of subparagraph 10(a) (i) (B) and Paragraphs 12 and 13 shall continue
in full force and effect only so long as full base compensation by EMPLOYER
shall continue.
17. SIGNING BONUS. (a) As a "signing bonus", EMPLOYER's parent,
Fidelity Holding's Inc., shall promptly issue to EMPLOYEE Thirty Thousand
(30,000) shares of its Common Stock, ownership to which shall vest as provided
below. The purpose of immediate issuance is to establish EMPLOYEE as a
stockholder as of the starting date of employment, subject to such subsequent
vesting, for purposes of dividends, stock splits, and other capital
transactions. EMPLOYEE represents and warrants that he is acquiring such shares
for personal investment purposes and not with a view to resale or distribution;
the certificates for such shares shall bear a legend on the face thereof
indicating that such shares have not been registered under the Securities Act of
1933 and are restricted as to further transfer.
(b) Ownership to the 30,000 shares shall vest as follows:
(i) upon completion of the first year of employment, ten thousand
(10,000) shares shall vest;
(ii) upon completion of the second year of employment, ten thousand
(10,000) shares shall vest; and
(iii) upon completion of the third year of employment, ten thousand
(10,000) shares shall vest.
The certificates for such shares shall bear a legend on the face
thereof indicating that such shares have not vested and cannot be sold,
transferred, assigned or otherwise disposed of until and unless they have
vested.
(c) As shares shall vest, EMPLOYEE may, subject to restrictions imposed
by applicable securities laws and regulations transfer,
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assign or otherwise dispose of the vested shares. EMPLOYEE may not sell,
transfer, assign or otherwise dispose or any shares not vested.
(d) During the three year vesting period, all dividends shall be paid
to EMPLOYEE to the extent that shares are vested. Dividends payable with respect
to shares not yet vested, shall be held by Fidelity Holdings, Inc. and shall be
paid over to EMPLOYEE proportionately as the shares shall vest. As shares shall
vest, all accrued dividends with respect thereto shall vest also. Stock splits
and other capital transactions shall also follow the status of the original
shares; i.e., vested or unvested.
18. ARBITRATION. Any controversy or claim arising out of, or relating
to this Agreement, or the breach thereof, shall be settled by arbitration in New
York City, New York in accordance with the rules then pertaining of the American
Arbitration Association, but with all rights of discovery provided by the New
York Rules of Civil Procedure, and judgment upon the award rendered may be
entered in any court having jurisdiction thereof. The losing party shall pay all
costs and fees, including reimbursement of the attorney's fees of the winning
party.
19. WAIVER OF BREACH. The waiver by either party of a breach of any
provision of this Agreement by the other party shall not operate or be construed
as a waiver of any subsequent breach by such other party. The failure of a party
to exercise any rights or privileges under this Agreement shall not be deemed to
be a waiver or extinguishment of such rights or privileges, all of which shall
continue to be exercisable.
20. BENEFIT. The rights and obligations of EMPLOYER under this
Agreement shall inure to the benefit of, and shall be binding upon it, its
successors and assigns. The protection of Paragraphs 10, 11 and 12 shall inure
to the benefit of EMPLOYER and any successors and assigns. The rights and
obligations of EMPLOYEE under this Agreement shall inure to the benefit of, and
shall be binding upon, his heirs, administrators, executors, successors and
assigns.
21. NOTICES. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing, and if sent by certified mail to
his residence in the case of EMPLOYEE, or to its principal office in the case of
EMPLOYER.
22. LIFE INSURANCE. EMPLOYER and/or one or more of its subsidiaries
may, in its discretion at any time after the execution of this Agreement, apply
for and procure, as owner and for its own benefit, insurance on the life of
EMPLOYEE, in such amounts and in such forms as EMPLOYER may choose. EMPLOYER
shall not be required to
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give EMPLOYEE any interest whatsoever in any such policy or policies, (although
nothing contained herein shall be deemed to prohibit any such arrangement) but
EMPLOYEE shall, at the request of EMPLOYER, subject himself to such medical
examination, supply such 'information, and execute such information releases and
documents as may be required by the insurance company or companies to whom
EMPLOYER has applied for such insurance.
23. ENTIRE AGREEMENT. This instrument contains the entire agreement of
the parties and may be modified only by agreement in writing signed by the party
against whom enforcement of any waiver, change, modification, extension or
discharge is sought.
24. APPLICABLE LAW. This Agreement shall be governed for all purposes
by the laws of the State of New York. If any provision of this Agreement is
declared void, such provision shall be deemed severed from this Agreement, which
shall otherwise remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto, intending to be legally bound,
have hereunto set their hands and seals as of the day and year herein above
written.
FIDELITY HOLDINGS, INC.
ATTEST:
By:__________________________________
President
________________________
Secretary
WITNESS:
_______________________ __________________________________
XXXXXX X. XXXXX
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