Exhibit 10.10
EMPLOYMENT AGREEMENT
SMARTGATE, INC.
THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into as of
this 9th day of February, 2000, by and between SmartGate, Inc., a Nevada
corporation, (the "Company") and Xxxxxx X. Xxxxxx ("Employee").
R E C I T A L S:
WHEREAS, the Company is in the business of developing, manufacturing and
marketing safety systems for closure devices based upon a proprietary
technology licensed to SmartGate, L.C., a Florida limited liability company,
from Radio Metrix, Inc. ("Business"); and
WHEREAS, Employee is employed by SmartGate, L.C.; and
WHEREAS, the Company is acquiring all of the outstanding stock of
SmartGate, L.C. with the intent to operate SmartGate, L.C. as a subsidiary; and
WHEREAS, the Company wishes to enter into this Employment Agreement
superseding the Employment Agreement previously entered into between SmartGate,
L.C. and Employee, thereby making Employee a direct employee of the Company
commencing at the acquisition of SmartGate, L.C. by the Company; and
WHEREAS, the Company and the Employee are desirous of setting forth in
this definitive Employment Agreement their respective rights and obligations
with respect to Employee's employment with the Company.
NOW, THEREFORE, in consideration of Employee's employment or continued
employment by the Company, in consideration of the mutual promises in this
Agreement, in consideration of Employee's prior employment with and services to
SmartGate, L.C., and for additional good and valuable consideration, the
receipt and sufficiency of which is acknowledged by the parties hereto, the
Company and the Employee agree as follows:
1. EMPLOYMENT AND TERM. On the terms and subject to the conditions of
this Agreement, the Company agrees to employ the Employee and the Employee
accepts such employment. Employee's employment under this Agreement shall
commence simultaneously with the acquisition of SmartGate, L.C. by the Company
and shall continue in effect for a period of five years from the date thereof.
This Agreement shall terminate at the end of said five-year period ("Termination
Date"), unless earlier terminated or continued by the parties pursuant to
Paragraph 6 hereinbelow.
2. DUTIES. The Employee is employed by the Company to perform the
duties, as specified from time to time by the Board of Directors and set forth
on Exhibit "A" which is attached hereto, incorporated herein and made a part
hereof ("Duties").
3. COMPENSATION. As compensation for Employee performing the Duties, the
Company shall pay Employee the compensation, as set forth on Exhibit "B" which
is attached hereto, incorporated herein and made a part hereof ("Compensation").
4. VACATIONS. Employee shall be entitled each year to a vacation as
provided in Exhibit "B", during which time Employee's Compensation shall be
paid in full.
5. FRINGE BENEFITS AND REIMBURSEMENT OF EXPENSES.
a. Employee shall be entitled to participate in any group plans or
programs maintained by the Company, if any, such as health insurance or other
related benefits as may be in effect from time to time and offered to the other
Employees of the Company ("Benefits").
b. The Company will reimburse Employee for Employee's out-of-pocket
expenses for entertainment, travel, and similar expenses reasonably incurred by
Employee in the performance of Employee's Duties hereunder ("Expenses") provided
such Expenses are consistent with policy and budgets established by the Board of
Directors from time to time. The Employee shall provide an itemized account of
such Expenses, itemizing such Expenses in reasonable detail, and reimbursement
for Expenses approved by the Board of Directors or its designated officer shall
be made in a reasonable time following the Employee's delivery of the itemized
account.
c. The Company shall provide Employee an automobile allowance as
provided in Exhibit "B", plus reimbursement for auto insurance and for actual
gasoline expenses for Company business.
6. TERMINATION OF EMPLOYMENT.
6.1 The Company shall have no right or entitlement under any
circumstances to terminate this Agreement except in accordance with the
provisions of this Section 6. Prior to the end of the term of this Agreement,
the Company may only terminate this Agreement as follows: (i) in the event of
Employee's death with termination only in accordance with the provisions of
Paragraph 6.2; or (ii) at the election of the Company in accordance with
Section 6.3, provided that the Company fully and completely satisfies the
obligation to pay the Severance Package Compensation provided for in Section
6.3.
6.2 In the event of Employee's death, this Agreement will terminate.
The Company shall pay to Employee's estate or as otherwise designated by
Employee, the following death benefit: (a) a fully paid life insurance policy
with a death benefit in the amount of $2,000,000; or (b) should the Company
fail to have such a life insurance policy in effect as provided in subsection
(a), an amount equal to the base salary to Employee for a period of five years,
which may be paid at the same intervals as the compensation would have been
paid had the employment not been terminated.
6.3 Prior to the Termination Date, the Company may, upon 30 days
written notice to the Employee, immediately thereafter terminate the Employee's
employment for any reason and without regard to cause. In the event of such
termination, the Company shall pay to Employee, a severance package consisting
of the Compensation (as set forth on Exhibit "B") and Benefits as described in
Paragraph 5 hereinabove (jointly referred to as the "Severance Package
Compensation"), which would have been due and owing to Employee during the
five-year period following the date of such Termination ("Severance Payment
Period"). The Severance Package Compensation shall be paid during the Severance
Payment Period at the same intervals as the Compensation and Benefits would
have been paid had the employment not been terminated.
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6.4 Prior to the Termination Date, the Employee may, upon 30 days
written notice to the Company, terminate Employee's employment with the
Company, and in such event, Employee shall not be entitled to any Compensation
or Severance Package Compensation following the date of such termination.
6.5 In the event this Agreement is not terminated prior to its
Termination Date, as set forth hereinabove in this Paragraph 6, then in such
event this Agreement shall terminate upon the Termination Date. Notwithstanding
the foregoing, if the Company is profitable as determined by the Company's
auditors, based upon generally accepted accounting principles consistently
applied during the 12 month period immediately prior to the end of the term of
this Agreement, this Agreement shall automatically be renewed for an additional
five-year term, all pursuant to the terms and conditions of this Agreement.
7. NON-COMPETITION. Simultaneously with his execution of this Agreement,
Employee shall execute a Covenant Not to Compete Agreement with the Company, as
set forth on Exhibit "C" which is attached hereto, incorporated herein and made
a part hereof.
8. CONFIDENTIALITY/WAIVER OF INTEREST. Simultaneously with the execution
of this Agreement, Employee shall execute a Confidentiality/Waiver of Interest
Agreement with the Company, as set forth on Exhibit "D" which is attached
hereto, incorporated herein and made a part hereof.
9. EMPLOYMENT AGREEMENT WITH SMARTGATE, L.C. Simultaneously with the
commencement of this Employment Agreement between the Company and Employee,
the Employment Agreement between the Employee and SmartGate, L.C. shall be
automatically superseded and replaced by this Agreement without reducing or
altering Employee's entitlement to unpaid compensation or benefits under said
agreement with SmartGate, L.C.
10. NOTICES. Any notice provided for in this Agreement must be in writing
and must be either personally delivered or mailed by certified mail, return
receipt required, to the recipient at the address indicated below:
TO THE COMPANY: TO THE EMPLOYEE:
SmartGate, Inc. Xxxxxx X. Xxxxxx
000 X. Xxxxxxxx Xxxxxx, Xxxxx 000 4400 Xxxxxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000 Xxxxxxxx, XX 00000
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party.
11. SEVERABILITY. In the event that any provision of this Agreement shall
be held to be unreasonable, invalid, or unenforceable for any reason
whatsoever, the parties agree that: (i) such invalidity or unenforceability
shall not affect any other provision of this Agreement and the remaining
covenants, restrictions, and provisions hereof shall remain in full force and
effect; and (ii) any court of competent jurisdiction may so modify the
objectionable provision as to make it valid, reasonable, and enforceable, and
such provision, as so modified, shall be valid and binding as though the
invalid, unreasonable, or unenforceable portion thereof had not been included
therein.
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12. COMPLETE AGREEMENT. This Agreement contains the entire agreement of
the parties and supersedes and preempts any prior understandings, agreements or
representations between Employee and the Company regarding the employment of
Employee.
13. COUNTERPARTS. This Agreement may be simultaneously executed in two
counterparts, each of which shall be an original, and all of which shall
constitute but one and the same instrument.
14. CHOICE OF LAW. This Agreement shall be governed by and construed in
accordance with the laws of the state of Florida, with venue in Sarasota County,
Florida.
15. ATTORNEY'S FEES. In the event that either party to this Agreement
shall be forced to retain the services of any attorney to enforce any of the
provisions hereof, than the prevailing party in any ensuing litigation shall be
entitled to recover from the non-prevailing party the prevailing party's
reasonable attorney's fees, court costs or other expenses of litigation, whether
incurred at trial or upon appeal.
16. AMENDMENTS/WAIVERS. This Agreement may only be modified, amended, or
waived by a writing duly authorized and executed by all parties.
17. WAIVER OF CONFLICT OF INTEREST. It is expressly acknowledged that Xx.
Xxxxxx is a partner in the law firm of XXXXXX & XXXXX, P.A. XXXXXX & XXXXX, P.A.
performs legal services for SmartGate, L.C. and following closing may provide
legal services to the Company. The Company expressly acknowledges the conflict
of interest in hiring Xx. Xxxxxx as an Employee and waives any such conflict of
interest. It is at the request of the Company that Xx. Xxxxxx serve both as an
Employee and his law firm serve as legal counsel.
18. PERMITTED ACTIVITIES. It is acknowledged that Employee is engaged in
other business activities and has other employment relationships. The Company
expressly permits Employee to engage in current and future business and
employment activities at the discretion of Employee, which are in addition to
the employment of Employee by the Company without any further approval or
consent by the Company and Employee is entitled to earn and retain compensation
as a result of such additional employment relationships or business activities.
In furtherance of the foregoing and not in limitation thereof, it is expressly
acknowledged and agreed by the Company that Employee is an employee, officer,
director and stockholder of Radio Metrix, Inc., New Freedom, Inc., entities
which have or may in the future have license agreements or sublicense agreements
with Radio Metrix, Inc. and other entities, some of which have or may have
business or financial relationships with the Company, SmartGate, L.C., Radio
Metrix, Inc. or other entities. Potential conflicts of interest resulting from
Employee's relationship with such entities are hereby waived by the Company and
the continued relationship and involvement of Employee in such entities is
expressly permitted.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day and
year first above written.
THE COMPANY: EMPLOYEE:
SmartGate, Inc.
By: /s/ Xxxxxx Xxxxxx /s/ Xxxxxx X. Xxxxxx
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Xxxxxx Xxxxxx, President Xxxxxx X. Xxxxxx
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EXHIBIT "A"
EMPLOYMENT AGREEMENT
BETWEEN
SMARTGATE, INC.
AND
XXXXXX X. XXXXXX
In accordance with Paragraph 2, Employee shall perform the following duties:
All duties associated with serving as Chairman and Treasurer.
EXHIBIT "B"
EMPLOYMENT AGREEMENT
BETWEEN
SMARTGATE, INC.
AND
XXXXXX X. XXXXXX
In accordance with Paragraph 3, Employee shall be paid the following
Compensation payable as set forth below:
1. $120,000 annual base salary, payable monthly, which shall automatically
increase to $150,000 per annual base salary once the Company achieves three
consecutive months of profit from operations, as determined by the Company's
accountants and in accordance with generally accepted accounting principles
consistently applied. At least annually, the Board of Directors shall review
the base salary for increase based upon performance of the Company;
2. $700 per month car allowance;
3. Eight weeks vacation.
4. A bonus as determined from time to time by the Company's Board of
Directors. The Company's Board of Directors shall quarterly review and declare a
bonus to Employee based upon the performance of the Company. It is anticipated
by the parties that, based upon the performance of the Company, bonus
compensation will constitute a significant part of Employee's overall
compensation from the Company.
