EXHIBIT 10.2
EMPLOYMENT AGREEMENT
Agreement, dated as of 17th day of November ,1999, by and between
XXXXXX.XXX, INC., a Delaware corporation having its principal place of business
at 0000 X. Xxxxxxxxx Xxxxxxxxx, Xxxxxxxxx Xxxxx, Xxxxxxx 00000 (the
"Corporation") and XXXXX X. XXXXXX, residing at 0000 Xxxxxxx Xxx Xxxxx,
Xxxxxxxxx Xxxxx, Xxxxxxx 00000 (the "Executive").
W I T N E S S E T H:
WHEREAS, the Corporation desires to employ Executive as an executive
officer, and Executive is willing to accept such employment, all subject to the
terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements set forth herein, the parties hereto agree as follows:
1. EMPLOYMENT AND TERM. Subject to the terms and conditions
hereof, the Corporation hereby employs Executive, and Executive hereby accepts
employment by the Corporation, for a period of three (3) years commencing on
November 17,1999, (the "Commencement Date") and ending on the third anniversary
of the Commencement Date, unless terminated sooner pursuant to the provisions
hereof. Thereafter, the Agreement shall be automatically renewed for successive
one (1) year terms (a "Renewal Term") unless terminated by the Corporation or
the Executive upon ninety (90) days' written notice prior to the beginning of a
Renewal Term.
2. DUTIES. Executive shall serve the Corporation as its
Chairman of the Board and Chief Executive Officer. Executive shall perform such
executive, administrative, management, marketing and other services and duties
as are incidental to the offices he holds and as may, from time to time, be
assigned to him by the Board of Directors of the Corporation or a committee
thereof. Executive shall devote substantially all of his time to the performance
of his duties hereunder. Executive further agrees to serve as an officer or
director of any parent, subsidiary or affiliate of the Corporation upon the
Corporation's request, with no additional compensation beyond that set forth in
Paragraph 3 below.
3. COMPENSATION.
(a) As base compensation for the services to be rendered by
Executive hereunder, the Corporation agrees to pay to Executive an annual base
salary in the amount of One Hundred Fifty Thousand Dollars ($150,000), such
salary to be paid in equal biweekly installments for so long as Executive is
employed by the Corporation.
(b) The Executive shall receive an annual bonus for each
calendar year (i) in a minimum amount equal to a percentage of the Corporation's
net income before taxes for that year, with the percentage to be determined by
the Corporation's Compensation Committee;
plus (ii) any additional amount, if any, to be determined by Corporation's
Compensation Committee in recognition of the Executive's contribution to the
Corporation.
(c) During the term of this Employment Agreement, the
Corporation shall not pay any of its other employees or officers a greater
annual compensation than the compensation to be paid Executive pursuant to the
preceding subparagraphs 3(a) and (b).
(d) Executive shall be entitled, on a basis consistent with
the Corporation's policy, to reimbursement for all normal and reasonable travel,
entertainment and other expenses necessarily incurred by him in the performance
of his obligations hereunder. The Corporation shall reimburse Executive for such
expenses upon presentation to the Corporation, within a reasonable time after
such expenses are incurred, of an itemized account of such expenses, together
with such vouchers or receipts for individual expense items as the Corporation
may from time to time require under its established policies and procedures.
(e) Executive shall be entitled to participate in, or benefit
from, in accordance with the eligibility and other provisions thereof, such
medical insurance, pension, retirement, or other fringe benefit plans or
policies as the Corporation may make available to, or have in effect for, its
executive personnel from time to time. Plans and benefits currently in effect
and in which Executive shall be participate during the term of this Agreement
are set forth in Schedule A attached hereto. Plans and benefits may be modified
or eliminated by the Corporation from time to time as it determines in its sole
discretion. Executive shall also be entitled to four (4) weeks of vacation and
other similar benefits in accordance with the policies of the Corporation from
time to time in effect for executive personnel.
(f) Except as hereinafter provided, the Corporation shall pay
Executive, for any period during the term of this Agreement during which he is
unable fully to perform his duties because of physical or mental disability or
incapacity, an amount equal to the compensation due him for such period in
accordance with this Agreement, less the aggregate amount of all income
disability benefits which for such period he may receive under or by reason of
(i) any applicable compulsory state disability law, (ii) the Federal Social
Security Act, (iii) any applicable workmen's compensation law or similar law,
and (iv) any plan towards which the Corporation or any parent, subsidiary or
affiliate of the Corporation has contributed or for which it has made payroll
deductions, such as group accident, disability or health policies.
4. TERMINATION ON DISABILITY OR DEATH.
(a) In the event that Executive, due to physical or mental
disability or incapacity, is unable to substantially perform his duties
hereunder for a period of three (3) successive months, the Corporation or
Executive shall then have the right to terminate this Agreement and Executive's
employment hereunder upon thirty (30)days' prior written notice, provided,
however, that in the event that Executive shall recommence rendering services
and performing all of his duties hereunder within such thirty (30) day notice
period, such notice shall be vitiated, and the Corporation and the Executive
shall no longer have the right to
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terminate based on the disability event described in the notice. Executive's
employment shall terminate immediately upon his death.
(b) Upon termination of Executive's employment by reason of
his death or disability as aforesaid, Executive, or in the case of Executive's
death, Executive's personal representatives, shall be entitled to receive all
base compensation earned or accrued to the date of such termination and not
already paid, less any benefits paid to Executive by reason of such disability.
(c) In the event of the termination of this Agreement for any
reason other than death, Executive shall have the right to purchase, and the
Corporation shall assign to Executive, any insurance policy maintained by the
Company on the life of Executive then in effect, for a price equal to the net
cash surrender value thereof at the time of such termination.
5. TERMINATION FOR CERTAIN CAUSES AND OTHER REASONS. In the
event of the (a) willful material misconduct of Executive in the performance of
his duties hereunder, (b) material breach of any provisions of Paragraphs 7, 8
or 9, or (c) conviction of the Executive for any felony under federal or state
law, this Agreement and Executive's employment hereunder may be terminated by
the Corporation without prior notice.
6. CHANGE OF CONTROL. In order to protect the Executive
against the possible consequences and uncertainties of a Change of Control of
the Corporation (as hereinafter defined) and thereby induce the Executive to
enter into the employ of the Corporation, the Corporation agrees that:
(a) If, during the initial three (3) year term of this
Agreement, the Executive's employment is terminated by the Corporation at any
time subsequent to a Change of Control other than for the causes set forth in
Paragraph 5, then in such event, the Corporation shall pay the Executive within
thirty (30) days after such termination, a lump sum payment in cash in an amount
equal to the balance of his base salary for the remaining term of the Agreement.
(b) For purposes of this Paragraph 6, in the event, following
a Change of Control, the Executive shall resign from his employment with the
Corporation within thirty (30) calendar days after he has obtained actual
knowledge of any significant change or proposed change in his title, nature of
duties, employee benefits or working conditions, in each instance without his
prior consent, such resignation shall be deemed to be a termination of
employment by the Corporation other than for the causes set forth in Paragraph
5.
(c) As used in this Paragraph 6, a "Change of Control" shall
be deemed to have occurred if (i) any "person" or "group of persons" (as such
terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended (the "1934 Act")), becomes the "beneficial owner" (as defined
in Rule 13d-3 promulgated under the 1934 Act), directly or indirectly, of
securities of the Corporation representing more than thirty-five percent (35%)
of the Corporation's then outstanding securities having the right to vote on the
election of directors or (ii) if directors constituting a majority of the Board
of Directors are
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elected to the Board of Directors without the recommendation or approval of the
incumbent Board of Directors.
7. DISCLOSURE AND ASSIGNMENT OF DISCOVERIES.
(a) Executive hereby covenants and agrees to disclose promptly
and fully, in writing, whenever possible, to the Corporation and its attorneys
and designated representatives, without additional compensation, all ideas,
formulae, programs, systems, devices, inventions, processes, business concepts,
discoveries, improvements, developments, works of authorship, product marks and
designations, technical information and know-how, whether or not patentable,
copyrightable or otherwise protectable relating to personalized diet and
nutrition programs (together, the "Developments"), which he may conceive,
develop, reduce to practice, acquire or make, alone or jointly with others:
(i) during the term of his employment with the
Corporation, whether during or outside of the usual hours of work;
(ii) within a period of two (2) years after
termination of his employment with the Corporation; and
(iii) within a period of three (3) years after
termination of his employment with the Corporation, if such Developments arise
out of any work done or concepts developed by Executive, alone or with others,
during his employment by the Corporation.
Executive hereby agrees that all of his right, title and interest in and to such
Developments shall be deemed as held by him in a fiduciary capacity solely for
the benefit of the Corporation, shall be the sole and exclusive property of the
Corporation and shall be subject to the confidentiality provisions of Section 8
as confidential information of the Corporation.
(b) Executive, when required to do so, either during or after
the term of his employment with the Corporation, shall:
(i) assign and convey to the Corporation his entire
right, title and interest in and to the Developments to the extent not owned by
the Corporation as a matter of law from the time of their creation and execute,
acknowledge and deliver all such further instruments and documents, in form and
substance satisfactory to the Corporation, as it shall deem reasonably necessary
or advisable to evidence the vesting in the Corporation of all right, title and
interest of Executive in and to the Developments;
(ii) assist the Corporation and its agents in
preparing patent applications, domestic and foreign, covering the Developments;
(iii) sign and deliver all such applications and
assignments of the same to the Corporation; and
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(iv) generally give all information and testimony,
sign all papers and do all things which may be needed or requested by the
Corporation to the end that the Corporation may obtain, extend, reissue,
maintain and enforce United States and foreign patents covering the
Developments.
(c) Executive hereby irrevocably nominates and appoints the
Corporation his attorney-in-fact to sign and deliver all such papers, and
perform all such acts mentioned in subparagraph 7(b), in the event of
Executive's absence, unavailability, or death, such nomination and appointment
hereby being granted with full authority in the premises, and such authority to
be deemed coupled with an interest vested in the Corporation.
(d) The Corporation agrees to bear all expenses which it
causes to be incurred in obtaining, extending, issuing, maintaining and
enforcing such patents and in investing and perfecting title thereto in the
Corporation, and agrees further to pay Executive for any time which it may
require of him therefor, and for any services that may be required of him
pursuant to subparagraph 7(b), subsequent to the termination of his employment
with the Corporation, such payment to be at an hourly rate equivalent to that at
which Executive is paid at the time of the termination of his employment by the
Corporation.
(e) In the event of the unenforceability of all or part of the
foregoing provisions of this Paragraph 7, as determined by a court of competent
jurisdiction, Executive hereby transfers and assigns to the Corporation such
lesser interests in the Developments, including, without limitations, any and
all United States and foreign patent rights therein and renewals thereof, as may
be determined by such a court to be a reasonable grant of interests under the
circumstances, but, in any event, and without limitation, Executive shall be
deemed to have granted to the Corporation not less than an irrevocable,
non-exclusive license, with the right to sublicense others, to manufacture, use,
lease and sell the Developments which have not been assigned to the Corporation
under the provisions of subparagraph 7(b), without payment of any royalty.
8. CONFIDENTIALITY.
(a) Executive understands and hereby acknowledges that as a
result of his employment with the Corporation, he will necessarily become
informed of, and have access to, certain valuable and confidential information
of the Corporation and any of its subsidiaries, joint ventures and affiliates,
including, without limitation, inventions, trade secrets, technical information,
know-how, plans, specifications, identity of customers and suppliers, and that
such information, even though it may be developed or otherwise acquired by
Executive, is the exclusive property of the Corporation to be held by Executive
in trust and solely for the Corporation's benefit. Accordingly, Executive hereby
agrees that he shall not, at any time, either during or subsequent to his
employment hereunder, use, reveal, report, publish, transfer or otherwise
disclose to any person, corporation or other entity, any of the Corporation's
confidential information without the prior written consent of the Corporation,
except to responsible officers and employees of the Corporation and other
responsible persons who are in a contractual or fiduciary relationship with the
Corporation or who have a need for such information for purposes in the interest
of the Corporation, and except for such information
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which legally and legitimately is or becomes of general public knowledge from
authorized sources other than Executive.
(b) Upon the termination of his employment with the
Corporation for any reason whatsoever, Executive shall promptly deliver to the
Corporation all drawings, manuals, letters, notes, notebooks, reports and copies
thereof, and all other materials, including, without limitation, those of a
secret and confidential nature, relating to the Corporation's business which are
in Executive's possession or control.
9. NON-COMPETITION. Executive agrees that, during the term of
this Agreement and for a period of two (2) years after the termination for any
cause of his employment with the Corporation, he shall not, anywhere in the
United States of America or elsewhere in the world (or in such smaller area or
for such lesser period as may be determined by a court of competent jurisdiction
to be a reasonable limitation on the competitive activity of Executive),
directly or indirectly:
(i) engage in a directly competitive line of business
to the business carried on by the Corporation, either for his own account or
with or for anyone else;
(ii) solicit or attempt to solicit business of any
customers of the Corporation for products or services the same or similar to
those offered, sold, produced or under development by the Corporation;
(iii) otherwise divert or attempt to divert from the
Corporation any business whatsoever;
(iv) solicit or attempt to solicit for any business
endeavor any employee of the Corporation;
(v) interfere with any business relationship between
the Corporation and any other person; or
(vi) render any services as an officer, director,
employee, partner, consultant or otherwise to, or have any interest as a
stockholder, partner, lender or otherwise in, any person which is so engaged.
Notwithstanding anything to the contrary contained in this Paragraph 9, the
provisions hereof shall not prevent the Executive from purchasing or owning up
to five percent (5%) of the voting securities of any corporation, the stock of
which is publicly traded.
10. REMEDIES. Because the Corporation does not have an
adequate remedy at law to protect its business from Executive's competition or
to protect its interests in its trade secrets, privileged, proprietary or
confidential information and similar commercial assets, the Corporation shall be
entitled to injunctive relief, in addition to such other remedies and relief
that would, in the event of a breach of the provisions of Paragraphs 7, 8 and 9,
be available to the Corporation. In the event of such a breach, in addition to
any other remedies, the
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Corporation shall be entitled to receive from Executive payment of, or
reimbursement for, its reasonable attorneys fees and disbursements incurred in
successfully enforcing any such provision.
11. SURVIVAL. The provisions of Paragraphs 7, 8 and 9 shall
survive termination of this Agreement for any reason.
12. ENTIRE AGREEMENT. This Agreement sets forth the entire
understanding of the parties and merges and supersedes any prior or
contemporaneous agreements between the parties pertaining to the subject matter
hereof. This Agreement may not be changed or terminated orally, and no change,
termination or attempted waiver of any of the provisions hereof shall be binding
unless in writing and signed by the party against whom the same is sought to be
enforced; PROVIDED, HOWEVER, that Executive's compensation may be increased at
any time by the Corporation without in any way affecting any of the other terms
and conditions of this Agreement, which in all other respects shall remain in
full force and effect. Failure of a party to enforce one or more of the
provisions of this Agreement or to require at any time performance of any of the
obligations hereof shall not be construed to be a waiver of such provisions by
such party nor to in any way affect the validity of this Agreement of such
party's right thereafter to enforce any provision of this Agreement, nor to
preclude such party from taking any other action at any time which it would
legally be entitled to take.
13. SUCCESSORS AND ASSIGNS. Neither party shall have the right
to assign this personal Agreement, or any rights or obligations hereunder,
without the consent of the other party; PROVIDED, HOWEVER, that upon the sale of
all or substantially all of the assets, business and goodwill of the Corporation
to another corporation, or upon the merger or consolidation of the Corporation
with another corporation, this Agreement shall inure to the benefit of, and be
binding upon, both Executive and the corporation purchasing such assets,
business and goodwill, or surviving such merger or consolidation, as the case
may be, in the same manner and to the same extent as though such other
corporation were the Corporation. Subject to the foregoing, this Agreement shall
inure to the benefit of, and bind, the parties hereto and their legal
representatives, heirs, successors and assigns.
14. ADDITIONAL ACTS. Executive and the Corporation each agrees
that he or it shall, as often as requested to do so, execute, acknowledge and
deliver and file, or cause to be executed, acknowledged and delivered and filed,
any and all further instruments, agreements or documents as may be necessary or
expedient in order to consummate the transactions provided for in this Agreement
and do any and all further acts and things as may be necessary or expedient in
order to carry out the purpose and intent of this Agreement.
15. COMMUNICATIONS. All notices, requests, demands and other
communications under this Agreement shall be in writing and shall be deemed to
have been given at the time when mailed in any United States post office
enclosed in a registered or certified postage prepaid envelope and addressed to
the addresses set forth at the beginning of this Agreement, or to such other
address as any party may specify by notice to the other party; PROVIDED,
HOWEVER, that any notice of change of address shall be effective only upon
receipt.
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16. CONSTRUCTION. The headings of the Paragraphs of this
Agreement have been inserted for convenience of reference only and shall in no
way restrict or otherwise affect the construction of the terms or provisions
hereof. References in this Agreement to Sections are to the sections of this
Agreement.
17. COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which shall be deemed to be an original and all of which
together shall be deemed to be one and the same instrument.
18. SEVERABILITY. If any provision of this Agreement is held
to be invalid or unenforceable by a court or tribunal of competent jurisdiction,
such invalidity or unenforceability shall not affect the validity and
enforceability of the other provisions of this Agreement and the provision held
to be invalid or unenforceable shall be carried out as nearly as possible
according to its original terms and intent to eliminate such invalidity or
unenforceability.
19. GOVERNING LAW. This Agreement is made and executed and
shall be governed by the laws of the State of Florida.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date first set forth above.
CORPORATION:
XXXXXX.XXX, INC.
By: /S/ XXXXXXXXX X. XXXXX
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Xxxxxxxxx X. Xxxxx, Secretary
EXECUTIVE:
/S/ XXXXX X. XXXXXX
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Xxxxx X. Xxxxxx
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SCHEDULE "A"
(1) Medical Insurance
(2) Long Term Care - $2,500 Annually
