EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement"), is entered into and effective
as of this 16 day of October 2002, by and between XXXXXXXX X. XXXX ("Executive")
and REGENCY AFFILIATES, INC. ("Company"), a Delaware corporation with its
principal place of business in Jensen Beach, Florida.
RECITALS
WHEREAS, in order to acquire the Executive's knowledge, experience and
abilities, the Company desires to employ the Executive as the President and
Chief Executive Officer of the Company, and the Executive desires to be so
employed, subject to the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the Company and Executive agree as follows:
SECTION 1. EMPLOYMENT.
(a) Position. Subject to the terms and conditions hereinafter set forth,
the Company hereby employs Executive and Executive hereby accepts such
employment for the provision of executive services on behalf of the Company as
President and Chief Executive Officer. The term of employment ("Term") shall
commence on the date hereof and shall terminate upon the earlier of (a) the date
on which the Executive attains Retirement Age (as defined below) or (b) the date
on which the employment of the Executive is terminated pursuant to Section 4
hereof. "Retirement Age" shall mean the date upon which Executive attains the
age which constitutes the earliest mandatory retirement age then imposed by the
Company, which shall not be less than sixty-five years of age; provided, that if
no such retirement age is imposed by the Company, the term "Retirement Age"
shall mean the date on which the Executive reaches seventy years of age.
(b) Duties. Executive agrees to perform such services customary to such
office as are reasonably required for the operations of the Company and such
other services as shall from time to time be assigned to Executive by the Board
of Directors of the Company (the "Board of Directors"). Executive shall devote
such time and attention to the business and affairs of the Company during the
Term as he shall determine to be necessary.
SECTION 2. COMPENSATION.
(a) Base Salary. The Company shall pay to Executive during the term of
this Agreement a base salary of no less than $150,000 per annum. The Board of
Directors may increase such compensation at any time in its sole discretion. All
compensation payments shall be subject to all applicable withholding.
(b) Bonuses. At the sole discretion of the Board of Directors, the Company
may pay to Executive an annual bonus based on Executive's performance as
President and Chief Executive Officer of the Company.
(c) Options. The Executive shall be granted options to purchase 25,000
shares of the Company's common stock at an exercise price of $1.35 per share
pursuant to such stock option plans as shall be established by the Board of
Directors from time to time.
SECTION 3. BENEFITS
In addition to the compensation specified in Section 2, the Company shall
provide Executive with the following fringe benefits:
(a) Executive Benefits. In addition to any other benefits provided in this
Section 3, Executive shall be entitled to those fringe benefits to which the
Board of Directors shall determine to make available to senior executives of the
Company from time to time.
(b) Business Expenses. Upon presentation of appropriate documentation, the
Company shall reimburse Executive for expenses reasonably incurred in the course
of Executive's employment, in accordance with policies established by the
Company.
(c) Insurance. The Company shall provide such life, travel accident,
health, major medical and long-term disability insurance for Executive and his
family that is generally provided to other executives of the Company or as may
be determined by the Board of Directors of the Company. In addition, the Company
shall also provide Executive with insurance against liabilities in connection
with his position as a director and/or officer of the Company.
SECTION 4. TERMINATION
Executive's employment hereunder shall terminate as follows:
(a) Termination Notice. Either party may terminate Executive's employment,
with or without cause, upon thirty (30) days written notice to the other party
("Termination Notice"). Executive and the Company may agree that Executive may
cease work after notice has been given but before the expiration of thirty (30)
days in which case the effective date of the termination of Executive's
employment shall be the date on which Executive ceases performing duties on
behalf of the Company.
(b) Death or Disability. Executive's employment shall terminate without
notice upon Executive's date of death or disability as that term is defined
herein. For purposes of this subsection, "disability" shall mean a period of six
(6) consecutive months or an aggregate of eight (8) months in any twelve (12)
consecutive month period during which Executive is disabled from performing his
duties and responsibilities hereunder by reason of any illness, accident, injury
or other health or medical condition of any kind.
(c) With Cause. The Company may, at any time and in its sole discretion,
terminate Executive's employment for Cause (as defined below) by delivery to
Executive of a Termination Notice specifying in reasonable detail the nature of
such Cause, effective as of the date of such Termination Notice, provided, that
such Termination Notice must be delivered to Executive within 30 days of the
date on which the Company first obtained knowledge of the event or events
forming the basis for such Cause. For purposes hereof, termination for "Cause"
shall mean (i) a conviction of Executive, by a court of competent jurisdiction
and after all appeal procedures
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have been exhausted or have expired, of or a plea of guilty or nolo contendere
by Executive to, any act which constitutes a felony in the jurisdiction
involved; (ii) the commission of a material fraudulent act or practice by
Executive involving the affairs of the Company; (iii) the continuing willful
failure by Executive to follow the lawful directions of the Board of Directors
(which directions are not inconsistent with this Agreement) (iv) the material
breach by Executive of this Agreement; or (v) an act of gross neglect or gross
or willful misconduct that relates to the affairs of the Company; provided, that
if Executive shall receive a Termination Notice with respect to a termination
for Cause pursuant to subsections (iii), (iv) or (v) hereof, the Executive shall
have thirty (30) days following his receipt of such Termination Notice to cure
the breach specified therein prior to his employment being terminated for Cause
pursuant hereto.
(d) Good Reason. Executive shall be entitled to terminate his employment
with the Company for Good Reason (as defined below) by delivery to the Company
of written notice thereof specifying the reason therefor, effective as of the
date of written notice to the Company. For purposes hereof, "Good Reason" shall
mean (i) a material breach by the Company of their obligations contained in this
Agreement, (ii) if Executive's duties and responsibilities are materially
reduced and a significant portion of his duties and responsibilities are
assigned to one or more other employees of the Company, (iii) a material change
in Executive's working conditions, or (iv) the occurrence of a "Change of
Control", as defined below. The Executive's employment shall not be deemed to
have been terminated for Good Reason until (A) Executive shall have delivered to
the Company written notice setting forth his intention to terminate his
employment hereunder for Good Reason pursuant to this Section 4(d), and (B) the
Company shall have failed to cure any such breach during the ten (10) day period
following the Company's receipt of such notice. As used herein, a "Change of
Control" shall be deemed to occur upon (i) the sale by the Company of all or
substantially all of its assets or a majority of its voting securities, in one
or more transactions related or unrelated, to any person or (ii) the
consolidation or merger of the Company with any person as a result of which the
Company is not the surviving entity and with respect to which persons who were
the shareholders thereof immediately prior to such consolidation or merger do
not, immediately thereafter own more than 50% of the combined voting power
entitled to vote generally in the election of directors of the consolidated or
merged company's then outstanding voting securities.
(e) Without Cause. Except as set forth in subsections (b) and (c) above,
the termination of Executive's employment by the Company shall constitute a
termination without Cause.
SECTION 5. EFFECT OF TERMINATION; SEVERANCE BENEFITS
(a) Termination Benefits For Termination Without Cause and For Good
Reason. If the Company terminates the employment of Executive without Cause or
if Executive terminates his employment for Good Reason:
1. The Company shall pay Executive two (2) years annual base salary in
a single lump sum payment payable promptly following the effective
date of the termination of Executive's employment.
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2. Executive shall be entitled to continued comprehensive health and
major medical insurance coverage, at the Company's cost, under the
Company's group insurance plan for a period of six (6) months after
the effective date of such termination of employment. Thereafter, to
the extent eligible, Executive may continue such coverage, at his
own cost, under COBRA.
3. During the period that termination benefits are paid under this
Agreement, Executive shall not be required to perform any duties for
the Company or report to the Company offices.
(b) No Benefits for With Cause Termination. Upon termination of this
Agreement by the Company with Cause, under the provisions of Section 4(c), the
Company shall not be obligated to pay to Executive any termination benefits and
the Company's obligations hereunder shall terminate with the effective date of
the termination of the Executive's employment. However, Executive's obligations
and covenants under Section 6 shall continue in full force and effect and shall
survive the termination of Executive's employment.
(c) Termination Benefits Upon Death or Disability. Upon the termination of
this Agreement by reason of Executive's death or disability under Section 4(b),
the Company shall pay Executive's estate or representative three months base
salary in a single lump sum payment promptly after the effective date of such
termination.
SECTION 6. CONFIDENTIALITY
While employed under this Agreement or at any time thereafter, Executive
agrees that he will not, directly or indirectly (other than in the performance
of the services under this Agreement), make or cause to be made any disclosure,
copy or other non-authorized use by the Company of any confidential information
pertaining to the Company or any of its affiliates acquired during the course of
his employment by the Company, unless such information is or becomes otherwise
generally available to the public. For purposes of this Agreement, the term
"confidential information" means any business and financial information of any
nature not generally known to the public at large regarding the business and
operations of the Company or any of its affiliates.
SECTION 7. MISCELLANEOUS
(a) Sole Agreement; Amendments. This Agreement constitutes the entire
agreement of the parties, supersedes all prior agreements and understandings,
and may be amended only by a written agreement executed by both of the parties
hereto.
(b) Notices. Any and all notices required to be given under this Agreement
shall be given by, and be deemed given when, (i) delivered by personal delivery;
(ii) deposited in U.S. first-class mail, postage prepaid; or (iii) sent by
telecopy with confirmation of receipt and by first class mail, postage prepaid,
addressed as follows:
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If to the Company: Regency Affiliates, Inc.
000 X.X. Xxxxxx Xxxxx Xxxxxxxxx
Xxxxxx Xxxxx, Xxxxxxx 00000
Attention: Board of Directors
Facsimile No.:
If to Executive: Xxxxxxxx X. Xxxx
c/o Hyde Park Holdings, Inc.
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
or such other address as a party may designate in writing to the other party.
(c) Severability. The invalidity or unenforceability of any particular
provision of this contract shall not affect its other provisions and this
Agreement shall be construed in all respects as if such invalid or unenforceable
provision had been omitted.
(d) Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of each of the parties hereto, their successors and assigns,
administrators, executors, legatees, and representatives, including, without
limitation, any corporation into which the Company may be merged or by which it
may be acquired.
(e) Headings. The headings used in this Agreement are for convenience only
and are not to be considered in construing or interpreting this Agreement.
(f) Governing Law. This Agreement shall be construed and enforced under
and in accordance with the internal laws of the State of Florida, without giving
effect to conflicts of law principles.
(g) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original, but all of which
together shall constitute one and the same instrument.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties have executed this Agreement effective as
of the date first set forth above.
REGENCY AFFILIATES, INC.
By:
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Name:
Title:
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Xxxxxxxx X. Xxxx
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