EMPLOYMENT AGREEMENT
Exhibit 10.3
THIS EMPLOYMENT AGREEMENT (“Agreement”) is entered into by and between Xxxxx Xxxxx Root (“Employee”) and VegasWinners, Inc., a Nevada corporation (the “Company”), and Jericho Associates, Inc., a Nevada corporation, is effective as of the date of a Closing (as defined therein) (the “Effective Date”) of a certain Share Exchange and Reorganization Agreement dated the 19 day of August, 2018
1. EMPLOYMENT. The Company agrees to employ Employee as the President and Chief Executive Officer of the Company, and Employee accepts and agrees to such employment. During Employee's employment with the Company, Employee shall perform all services and acts necessary or advisable to fulfill the duties and responsibilities as are commensurate and consistent with Employee's position and shall render such services on the terms set forth herein. Employee shall have such powers and duties with respect to the Company as may reasonably be assigned to Employee by the Board, to the extent consistent with Employee's position and status. Employee agrees to perform the duties of Employee's position in accordance with the Company's policies as in effect from time to time. Employee's principal place of employment shall be the Company's offices located in Las Vegas, Nevada.
(c) INCENTIVE BONUS. Employee will be eligible to receive an annual cash bonus (the “Incentive Bonus”), which shall be payable upon achievement of performance goals mutually agreed between Employee and the Company.
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(i) Reimbursement for Business Expenses. During the Term, the Company shall reimburse Employee for all reasonable expenses incurred by Employee in performing Employee's duties for the Company, on the same basis as other executive officers and directors of the Company and in accordance with the Company's policies as in effect from time to time.
The Company acknowledges that Employee is engaged in other activities, including but not limited to, radio, television, book publishing and political activities, and that the performance of those activities by Employee will not violate the Employment Agreement with the Company and VegasWinners, Inc. (“VWI”) (a wholly owned subsidiary of the Company), provided such activities will not materially conflict or interfere with the business of VWI and the Company or its successor-in-interest.
If to the Company:
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VegasWinners, Inc.
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c/o Jericho Associates, Inc.
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Attention: Xxxxxx Xxxxxxxxx
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If to Employee:
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At the most recent address on record for Employee at the Company.
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With a cc to:
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Xxx Xxxxx, Esquire
Law Offices of Xxx Xxxxx, APC
000 Xxxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
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Either party may change such party's address for notices by notice duly given pursuant hereto.
(a). Employee will be named as an insured on the director and officer liability insurance policy currently maintained, or as may be maintained by the Company from time to time, and, in addition, Employee will enter into the form of indemnification agreement provided to other similarly situated executive officers and directors of the Company.
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(b) The Company shall indemnify Employee, to the fullest extent permitted by law, with respect to services to the Company and activities in connection with his employment hereunder against all obligations to pay money or perform or not perform actions, including without limitation judgments, settlements, penalties, fines, and reasonable Expenses (as defined below) arising from, related to, or connected with any threatened, pending or completed action, suit or proceeding, whether civil, criminal (except for criminal acts outside Company’s relationship to the cannabis industry), administrative, arbitrative or investigative, that involves Employee because Employee now serves or has served (i) as an employee or other service provider of the Company or (ii) at the Company’s written instruction, as an employee or service provider to another legal entity (in each case, a “Claim”).
(c) The Company shall pay Employee’s reasonable attorneys’ fees, costs and expenses (“Expenses”) arising from, related to, or connected with a Claim before the final disposition of the Claim. The Company shall pay any statement for Employee’s Expenses within 20 days after receipt of the statement; provided, that (a) such statements shall reasonably evidence the Expenses incurred by Employee or on Employee’s behalf and shall include reasonable backup information for all costs and disbursements in excess of $250.00 and (b) any request for payment of attorneys’ and other experts’ fees and costs must be accompanied by a detailed billing statement, redacted only as necessary to preserve any applicable attorney-client or other legally recognized privilege.
7. GOVERNING LAW; JURISDICTION. This Agreement and the legal relations thus created between the parties hereto shall be governed by and construed under and in accordance with the internal laws of the State of Nevada without reference to the principles of conflicts of laws. Any and all disputes between the parties which may arise pursuant to this Agreement will be heard and determined before an appropriate court in the County of Xxxxx, State of Nevada. The parties acknowledge that such courts have jurisdiction to interpret and enforce the provisions of this Agreement, and the parties consent to, and waive any and all objections that they may have as to, personal jurisdiction and/or venue in such courts.
VegasWinners, Inc.
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Jericho Associates, Inc. (for purposes
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of Paragraph 3E only
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By: s/Xxxxx Xxxxx Root
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By: s/Xxxxxx Xxxxxxxxx
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Title: CEO & President
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Title: Acting CEO
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Employee:
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s/ Xxxxx Xxxxx Root
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Xxxxx Xxxxx Root
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STANDARD TERMS AND CONDITIONS
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(i) the Company shall continue to pay Employee the Base Salary through the longer of (x) the end of the Term over the course of the then remaining Term and (y) 12 months (such period, the “Salary Continuation Period” and such payments, the “Cash Severance Payments”), in each case payable in equal biweekly installments and the Company shall pay in cash to Employee (within 10 business days of each applicable monthly period) for each month between the date of termination and the end of the Salary Continuation Period an amount equal to the premiums charged by the Company to maintain COBRA benefits continuation coverage for Employee and Employee's eligible dependents to the extent such coverage is then in place;
(ii) the Company shall pay Employee within 30 days of the date of such termination in a lump sum in cash any Accrued Obligations;
(iii) any compensation awards of Employee based on, or in the form of, Company equity (e.g. restricted stock, restricted stock units, stock options or similar instruments) (“Equity Awards”) that are outstanding and unvested at the time of such termination shall 100% vest (and with respect to awards other than stock options and stock appreciation rights, settle) as of the date of such termination of employment; provided further that any amount that would vest under this provision but for the fact that outstanding performance conditions have not been satisfied shall vest (and with respect to awards other than stock options and stock appreciation rights, settle) as if such performance conditions had been fully satisfied ; and provided further that if any Equity Awards made subsequent to the Effective Date of this Agreement specifies a more favorable post-termination vesting schedule for such equity, the terms of the award agreement for such Equity Award shall govern; and
(iv) any then vested options of Employee (including options vesting as a result of (iii) above) to purchase Company equity, shall remain exercisable through the time of their exercise period.
(v) The payment to Employee of the severance pay or benefits described in Section 1(d) (other than any Accrued Obligations) is contingent upon Employee signing and not revoking a separation and release of the Company and its affiliates in a form substantially similar to that used for similarly situated executive officers of the Company (the “Release”), the offset provisions in Section 1(e), and Employee's compliance with the restrictive covenants set forth in Section 2 (other than any non-compliance that is immaterial, does not result in harm to the Company or its affiliates, and, if curable, is cured by Employee promptly after receipt of notice thereof given by the Company). The Release must become effective no later than sixty (60) days following Employee's employment termination date or such earlier date required by the Release (such deadline, the “Release Deadline”). If the Release does not become effective by the Release Deadline, Employee will forfeit any rights to severance. In no event will severance payments or benefits (other than any Accrued Obligations) be paid or provided until the Release becomes effective and irrevocable. Upon the Release becoming effective and irrevocable, any payments delayed from the date Employee terminates employment through the effective date of the Release will be payable in a lump sum without interest as soon as administratively practicable after the Release Deadline and all other amounts will be payable in accordance with the payment schedule applicable to each payment or benefit. In the event the termination occurs at a time during the calendar year where the Release could become effective in the calendar year following the calendar year in which Employee's termination occurs, then any severance payments or benefits that would be considered Deferred Payments (as defined below) will be paid on the first payroll date to occur during the calendar year following the calendar year in which such termination occurs, or, if later, (i) the Release Deadline, (ii) such time as required by the payment schedule provided above that is applicable to each payment or benefit, or (iii) the Delayed Initial Payment Date (as defined below). Employee acknowledges and agrees that the Company's payment of severance pay and benefits (except Accrued Obligations) constitutes good and valuable consideration for such Release.
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As used herein, “Good Reason” shall mean the occurrence of any of the following without Employee's prior written consent: (A) the Company's breach of any material provision of this Agreement or the failure to have this agreement assumed by any successor, (B) the material reduction in Employee's duties, reporting responsibilities or level of responsibilities, excluding for this purpose any such reduction that is an isolated and inadvertent action not taken in bad faith or that is authorized pursuant to this Agreement, (C) a reduction in Employee's Base Salary or Employee's total annual compensation opportunity, or (D) the relocation of Employee's principal place of employment more than 100 miles outside the Las Vegas Metropolitan Area or his residence, provided that in no event shall Employee's resignation be for “Good Reason” unless (x) an event or circumstance set forth in clauses (A) through (D) shall have occurred and Employee provides the Company with written notice thereof within 30 days after Employee has knowledge of the occurrence or existence of such event or circumstance, which notice specifically identifies the event or circumstance that Employee believes constitutes Good Reason, (y) the Company fails to correct the circumstance or event so identified within 30 days after receipt of such notice, and (z) Employee resigns within 90 days after the date of delivery of the notice referred to in clause (x) above. Notwithstanding the preceding provisions of this Section [1(d)], in the event that Employee is a “specified employee” (within the meaning of Section 409A) on the date of termination of Employee's employment with the Company and the Cash Severance Payments to be paid within the first six months following such date (the “Initial Payment Period”) exceed the amount referenced in Treas. Regs. Section 1.409A-1(b)(9)(iii)(A) (the “Limit”), then (1) any portion of the Cash Severance Payments that is a “short-term deferral” within the meaning of Treas. Regs. Section 1.409A-1(b)(4)(i) shall be paid at the times set forth in Section 1(d), (2) any portion of the Cash Severance Payments (in addition to the amounts contemplated by the immediately preceding clause (1)) that is payable during the Initial Payment Period that does not exceed the Limit shall be paid at the times set forth in Section 1(d) as applicable, (3) any portion of the Cash Severance Payments that exceeds the Limit and is not a “short-term deferral” (and would have been payable during the Initial Payment Period but for the Limit) shall be paid, with Interest, on the first business day of the first calendar month that begins after the six-month anniversary of Employee's “separation from service” (within the meaning of Section 409A) and (4) any portion of the Cash Severance Payments that is payable after the Initial Payment Period shall be paid at the times set forth in Section 1(d). For purposes of this Agreement, “Interest” shall mean interest at the applicable federal rate provided for in Section 7872(f)(2)(A) of the Code, from the date on which payment would otherwise have been made but for any required delay through the date of payment.
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(a) CONFIDENTIALITY. Employee acknowledges that while employed by the Company Employee will occupy a position of trust and confidence. The Company has provided and shall continue to provide Employee with Confidential Information. Employee shall hold in a fiduciary capacity for benefit of the Company and its subsidiaries and affiliates, and shall not, except as may be required to perform Employee's duties hereunder or as required by applicable law, without limitation in time, communicate, divulge, disseminate, disclose to others or otherwise use, whether directly or indirectly, any Confidential Information. “Confidential Information” shall mean information about the Company or any of its subsidiaries or affiliates, and their respective businesses, employees, consultants, contractors, suppliers, clients and customers that is not disclosed by the Company or any of its subsidiaries or affiliates for financial reporting purposes and that was learned by Employee in the course of employment by the Company or any of its subsidiaries or affiliates, including (without limitation) any proprietary knowledge, trade secrets, data, formulae, processes, methods, research, secret data, costs, names of users or purchasers of their respective products or services, business methods, operating procedures or programs or methods of promotion and sale, information relating to accounting or tax strategies and data, information and client and customer lists and all papers, resumes, and records (including computer records) of the documents containing such Confidential Information. For purposes of this Section 2(a), excluded from the definition of Confidential Information are the following: Confidential Information shall not include information that is (1) generally available to, and known by, the public at the time of disclosure to the Employee, provided that such disclosure is through no direct or indirect fault of the Employee or person(s) acting on the Employee's behalf; or (2) known by the Employee before obtaining access to it under this Agreement; or (3) provided to the Employee by a third party not under an obligation of confidence benefiting the Employer; or (4) independently developed by the Employee without use of the Employer’s Confidential Information; or (5) disclosed by the Employer to a third party without confidentiality obligations comparable to those of this Agreement. For purposes of this Section 2(a), information shall not cease to be Confidential Information merely because it is embraced by general disclosures for financial reporting purposes or because individual features or combinations thereof are publicly available. Notwithstanding the foregoing provisions, if Employee is required to disclose any such confidential or proprietary information pursuant to applicable law or a subpoena or court order, Employee shall promptly notify the Company in writing of any such requirement so that the Company may seek an appropriate protective order or other appropriate remedy or waive compliance with the provisions hereof. Employee shall reasonably cooperate with the Company to obtain such a protective order or other remedy. If such order or other remedy is not obtained prior to the time Employee is required to make the disclosure, or the Company waives compliance with the provisions hereof, Employee shall disclose only that portion of the confidential or proprietary information which he is advised by counsel that he is legally required to so disclose. Employee acknowledges that such Confidential Information is specialized, unique in nature and of great value to the Company and its subsidiaries or affiliates, and that such information gives the Company and its subsidiaries or affiliates a competitive advantage. Employee agrees to deliver or return to the Company, at the Company's request at any time or upon termination or expiration of Employee's employment, all documents, computer tapes and disks, plans, initiatives, strategies, records, lists, data, drawings, prints, notes and written information (and all copies thereof) created by or on behalf of the Company or its subsidiaries or affiliates or prepared by Employee in the course of Employee's employment by the Company and its subsidiaries or affiliates. As used in this Agreement, “subsidiaries” and “affiliates” shall mean any company controlled by, controlling or under common control with the Company.
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Notwithstanding this Paragraph 2(a), the Company acknowledges that Employee is engaged in other activities, including but not limited to, radio, television, book publishing and political activities, and that the performance of those activities by Employee will not violate the Employment Agreement with the Company and VegasWinners, Inc. (“VWI”) (a wholly owned subsidiary of the Company), provided such activities will not materially conflict or interfere with the business of VWI and the Company or its successor-in-interest.
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6. HEADING REFERENCES. Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose. References to “this Agreement” or the use of the term “hereof” shall refer to these Standard Terms and Conditions and the Employment Agreement attached hereto, taken as a whole.
ACKNOWLEDGED AND AGREED AS OF THE EFFECTIVE DATE:
VegasWinners, Inc.
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By: s/ Xxxxx Xxxxx Root
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August 19, 2018
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Title: CEO & President
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Employee:
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s/ Xxxxx Xxxxx Root
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August 19, 2018
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Xxxxx Xxxxx Root
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Jericho Associates, Inc.
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By: s/ Xxxxxx Xxxxxxxxx
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August 19, 2018
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Title: Acting CEO
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