EMPLOYMENT AGREEMENT
Exhibit
10.3
THIS EMPLOYMENT AGREEMENT
(this “Agreement”) is made
as of the 19th day of January, 2011 (the “Effective Date”) by
and between C2 Global Technologies Inc., a Florida corporation (the “Company”), and
Xxxx Xxxxx (“Executive”).
Executive
is skilled in legal, business and financial matters, especially as they relate
to the asset liquidation business. The parties hereto believe that it is in
their respective interests to enter into an employment agreement whereby, for
the consideration specified herein, Executive shall provide the services
specified herein. Certain definitions are set forth in Section
7.
The
parties hereto agree as follows:
Section
1. Employment.
(a) Employment Period.
The Company agrees to employ Executive and Executive accepts such employment for
the period (the “Employment Period”)
beginning on the Effective Date and ending on the fifth anniversary of the
Effective Date. The Employment Period will renew automatically on a
year-to-year basis thereafter, until either party gives notice of non-renewal
not less than sixty (60) days prior to an anniversary of the Effective
Date. The Employment Period will end on an earlier date if
Executive’s employment is terminated in accordance with Section 2 (the date
of termination or non-renewal being hereinafter called the “Termination
Date”).
(b) Position and
Duties.
(i) During
the Employment Period, Executive shall serve as the Co-CEO of the Company and
Executive shall report to the Chairman of the Board of the Company. Executive
shall perform all duties and shall have all powers which are commonly incident
to his office as well as all powers that are delegated to Executive by the
Chairman of the Board of the Company.
(ii) Executive
shall devote his best efforts and his full business time and attention to the
business and affairs of the Company, except for permitted vacation periods in
accordance with the Company’s policy, periods of illness or other incapacity,
and reasonable time spent with respect to civic and charitable activities,
provided that none of such activities materially interfere with Executive’s
duties to the Company or its Subsidiaries.
(c) Salary, Bonus and
Benefits.
(i) During
the Employment Period, the Company shall pay Executive a base salary at the rate
of $450,000 per annum (the “Base Salary”) in such
installments in accordance with the regular payroll practices of the Company
with respect to executive officers of the Company. The Board shall review the
Base Salary annually, but not reduce it.
(ii) During
the Employment Period, Executive will be eligible for a discretionary annual
bonus of up to fifty percent (50%) of the Base Salary, pro-rated for any periods
that do not commence on January 1 or end on December 31 in any given year (based
on the actual number of days elapsed over a year of 365 or 366 days, as
applicable) (the “Bonus”). The Chairman
of the Board of the Company shall determine the amount of any Bonus to be
awarded based on performance criteria established at the beginning of each
fiscal year, and the timing of such award and the payment of any such Bonus
shall be made within the ninety (90) day period beginning on March 1 of each
year immediately following the fiscal year in which the services to which the
Bonus applies were performed.
(iii) During
the Employment Period, Executive will be entitled to participate in all employee
stock option, pension and welfare benefit plans, programs and practices
maintained by the Company for its employees generally in accordance with the
terms of such plans, programs and practices as in effect from time to time, and
in any other insurance, pension, retirement or welfare benefit plans, programs
and practices which the Company generally provides to its executives from time
to time.
(iv) On
the Effective Date, the Company will grant Executive options to purchase 625,000
shares of the Company’s common stock with an exercise price of $1.83 per share
and with vesting over four years beginning on the first anniversary of the
Effective Date (the “Option Award”). The
Option Award will be subject to the terms and conditions of the Company’s 2010
Nonqualified Stock Option Plan (the “Plan”) and a
Nonqualified Stock Option Agreement approved under the Plan.
(v)
The Company shall pay
Executive a signing bonus in the amount of $100,000 promptly following the
Effective Date.
(d) Expenses. The Company
shall pay or reimburse Executive (at the Company’s option) in accordance with
the Company’s then-current policies for fully-documented (in accordance with the
Company’s policies) reasonable and necessary expenses and other disbursements
incurred by Executive for or on behalf of the Company in the performance of his
duties hereunder, including, without limitation, travel on behalf of or in
connection with his services for the Company in a manner customary for the
Company’s senior executives, including food and lodging expenses while Executive
is away from home performing services for the Company.
(e) Workplace and Work
Schedule. Executive’s workplace will be the Company’s office in New York,
or such other office or offices as are approved by the Company. Executive is
entitled to such holidays as are established by the Company’s policies.
Executive is entitled to four (4) weeks of vacation per year of employment,
which may be taken in various periods, subject to the Company’s
needs.
Section
2. Termination Of
Employment.
(a) Death or Disability.
The Company may terminate Executive’s employment during the Employment Period
due to his death or Disability. If Executive dies during the Employment Period,
the Termination Date will be deemed to be the date of his death.
(b) Cause. The Company
may terminate the employment of Executive at any time during the Employment
Period for Cause by giving him a Notice of Termination.
(c) Without Cause. The
Company may terminate Executive’s employment at any time during the Employment
Period without Cause by giving him a Notice of Termination.
(d) Good Reason.
Executive may terminate his employment during the Employment Period for Good
Reason by providing the Company a Notice of Termination within 45 days of his
knowledge of the event which he believes provides him with grounds to terminate
his employment for Good Reason.
Section
3. Effect Of Termination Of
Employment.
(a) Death or Disability.
If Executive’s employment is terminated due to death or Disability pursuant to
Section 2(a),
neither Executive nor his beneficiary or estate will have any further rights or
claims against the Company under this Agreement, except the right to
receive:
(i) the
earned but unpaid portion, if any, of the Base Salary, computed on a pro-rata
basis through the Termination Date (based on the actual number of days elapsed
over a year of 365 or 366 days, as applicable);
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(ii)
any outstanding amounts owed to Executive, if any, pursuant to Section 1(d)
(collectively, the “Accrued
Compensation”); and
(iii) provided
that Executive has met, as of the Termination Date, the performance criteria
established with respect to the Bonus for the fiscal year in which the
Termination Date occurs, the pro-rata portion of the Bonus for such fiscal year
(based on the actual number of days elapsed from the beginning of the fiscal
year to the Termination Date over a year of 365 or 366 days, as applicable), the
timing of the payment of any such Bonus to be in accordance with Section
1(c)(ii).
(b) Cause. If Executive’s
employment is terminated by the Company for Cause pursuant to Section 2(b), neither
Executive nor his beneficiary or estate will have any further rights or claims
against the Company under this Agreement, except the right to receive the
Accrued Compensation.
(c) Without Cause. If
Executive’s employment is terminated by the Company without Cause pursuant to
Section 2(c),
neither Executive nor his beneficiary or estate shall have any further rights or
claims against the Company under this Agreement, except the right to
receive:
(i) the
Accrued Compensation;
(ii) an
amount equal to the amount of the Base Salary, payable in a lump sum, Executive
would have received for the period commencing on the Termination Date and ending
12 months after the Termination Date as provided in Section 9(b);
and
(iii)
provided that
Executive has met, as of the Termination Date, the performance criteria
established with respect to the Bonus for the fiscal year in which the
Termination Date occurs, the pro-rata portion of the Bonus for such fiscal year
(based on the actual number of days elapsed from the beginning of the fiscal
year to the Termination Date over a year of 365 or 366 days, as applicable),
payable in a lump sum to be in accordance with Section 1(c)(ii).
(d) Good
Reason. If Executive’s employment is terminated by Executive
for Good Reason pursuant to Section 2(d), neither
Executive nor his beneficiary or estate shall have any further rights or claims
against the Company under this Agreement, except the right to
receive:
(i)
the
Accrued Compensation; and
(ii) an
amount equal to the amount of the Base Salary, payable in equal monthly
installments in accordance with Section 1(c)(i),
Executive would have received for the period commencing on the Termination Date
and ending 12 months after the Termination Date as provided in Section
9(b).
(e) Release. Executive
acknowledges and agrees that the payments provided for in Sections 3(c)(ii) and
3(d)(ii) constitute liquidated damages for any claim of breach of
contract under this Agreement as it relates to termination of his employment
during the Employment Period without Cause pursuant to Section 2(c) or with
Good Reason pursuant to Section 2(d).
Notwithstanding the foregoing, if Executive is entitled to the payments set
forth in Section
3(c)(ii) or Section 3(d)(ii),
Executive shall execute and agree to be bound by an agreement, in form and
substance satisfactory to the Company (the “Release”), relating
to the waiver and general release of any and all claims arising out of or
relating to Executive’s employment and termination of employment, and the
Company will have no obligation to make the payments contemplated under Section 3(c)(ii) or
Section
3(d)(ii), as the case may be, if Executive fails to execute such Release
or seeks to revoke such Release before it becomes effective. In addition, if
Executive violates or threatens to violate the terms of Section 4, the
continuing obligations of the Company to make the payments contemplated under
Section
3(c)(ii) or Section 3(d)(ii), as
the case may be, shall immediately terminate.
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Section
4. Restrictions.
(a) Executive
shall at all times, both during the Employment Period and for a period of 12
months following the Termination Date (or, with respect to any trade secret, for
so long as such trade secret retains its status as such under applicable law),
keep strictly confidential and not use or disclose to any third party any trade
secret, information, knowledge or data not generally known to the public which
Executive may have learned, discovered, developed, conceived, originated,
prepared or received during or as a result of Executive’s employment by the
Company or any Subsidiary or Affiliate with respect to the operations,
businesses, affairs, products, services, technology, intellectual properties,
Agents, customers, clients, pricing of products or services, policies,
procedures, accounts, personnel, concepts, format, style, techniques or software
of the Company or any Subsidiary or Affiliate (“Proprietary
Information”). Executive acknowledges that Proprietary Information
includes, without limitation, the business or other needs, requirements,
preferences or other information relating to Agents and customers of the Company
or any Subsidiary or Affiliate, acquisition targets of the Company or any
Subsidiary or Affiliate and all information or data collected by the Company
with reference thereto. Executive shall comply with any and all procedures which
the Company may adopt from time to time to preserve the confidentiality of any
trade secret or other confidential and proprietary information. Immediately upon
the Termination Date, he shall (i) return to the Company all Proprietary
Information he has received, regardless of how recorded, including all copies
thereof made by him or any employee, agent or advisor of or to him, (ii) destroy
(or cause to be destroyed) all materials incorporating or based on such
Proprietary Information, and (iii) certify in writing that the foregoing have
been completed. The Company may, in its sole discretion, upon or after the
Termination Date, notify Executive’s new employer, clients or other parties that
Executive has had access to certain trade secrets or other confidential and
proprietary information which Executive is under a continuing obligation not to
use or disclose. Notwithstanding the foregoing, the limitations imposed on
Executive pursuant to this Section 4(a) will not
apply to Executive’s disclosure pursuant to an order of a court or governmental
agency, provided that Executive notifies the Company and affords it an
opportunity to oppose such order.
(b) In
order to protect the Company from unfair competition and to prevent the
unauthorized disclosure or use of the Proprietary Information, both during the
Employment Period and for a period of 12 months following the Termination Date,
Executive shall not, within the Restricted Territory (defined below), directly
or indirectly engage in or become associated with any Competitive Activity
(defined below). Executive will be considered to have become
“associated with a Competitive Activity” if he becomes involved as an owner,
employee, employer, consultant, principal, officer, director, independent
contractor, agent, partner, advisor or in any other capacity, with or without
compensation, calling for the rendition of personal services with any Person
that is engaged in a Competitive Activity and his involvement relates to a
significant extent to the Competitive Activity of such Person; provided, however, that
Executive will not be prohibited from owning less than five percent (5%) of any
publicly traded corporation that is in competition with the
Company. “Competitive Activity” means (i) the acquisition and
disposition of distressed and surplus assets throughout the United States and
Canada, including industrial machinery and equipment, real estate, inventories,
accounts receivables and distressed debt, (ii) the provision of traditional
asset disposition services, such as on-site and webcast auctions, liquidations
and negotiated sales, (iii) assisting financial institutions, bankruptcy and
restructuring firms and corporate clients with complex asset transactions that
arise from bankruptcies, plant closures, and restructuring situations, and (iv)
any other products or services being offered by the Company on the Termination
Date. “Restricted Territory” means the United States and
Canada. In the alternative, and only if the above territory is deemed
by a court of competent jurisdiction to be unreasonable or otherwise invalid or
unenforceable, then the Restricted Territory means New York State, California,
and any other state or province in which Executive maintained an office or
otherwise provided services to the Company during the term of this
agreement. Notwithstanding the foregoing, this Section 4(b) shall
not apply after the Termination Date in the event that Executive’s employment is
terminated by the Company without Cause pursuant to Section 2(c) or by
Executive for Good Reason pursuant to Section
2(d).
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(c) In
order to protect the Company from unfair competition and to prevent the
unauthorized disclosure or use of the Proprietary Information, both during the
Employment Period and for a period of 24 months following the Termination Date,
Executive shall not, directly or indirectly, for his own account or as a
partner, joint venturer, employee, agent, or consultant: (i) employ as an
employee, engage as an independent contractor or agent or otherwise retain or
solicit or seek to so employ, engage, retain or solicit any person who, during
any portion of the two (2) years prior to the Termination Date was, directly or
indirectly, employed as an employee, engaged as an independent contractor or
Agent or otherwise retained by the Company or any Subsidiary or Affiliate; (ii)
induce any Person (except for individuals considered to be clerical or
secretarial staff) to leave his or her employment with the Company, terminate an
independent contractor or Agent relationship with the Company or terminate or
reduce any contractual relationship with the Company or any Subsidiary or
Affiliate; or (iii) directly or indirectly induce or influence any Agent,
customer, supplier, or other person that has a business relationship with the
Company or any Subsidiary or Affiliate to discontinue or reduce the extent of
such relationship.
(d) Both
during and after the Employment Period, except as required by applicable law or
compelled by legal process, neither Executive nor anyone acting on his behalf
will (i) make any derogatory, disparaging or critical statement about the
Company or any of its present or former officers, directors, employees,
shareholders, parents or subsidiaries or (ii) without the prior written consent
of the Company, communicate, directly or indirectly, with the press or other
media concerning the Company or the present or former employees or business of
the Company (other than incidental references to the Company or its business
which are non-specific in nature and included as a part of Executive’s general
market observations). Further, the Company agrees that, both during
and after the Employment Period, except as required by applicable law or
compelled by legal process, neither the Company nor anyone acting on its behalf
will (i) make any derogatory, disparaging or critical statement about Executive
or (ii) without the prior written consent of Executive, communicate, directly or
indirectly, with the press or other media concerning Executive.
(e) All
processes, improvements, formulations, ideas, inventions, designs and
discoveries, whether patentable or not (collectively “Discoveries”) and all
patents, copyrights, trademarks, and other intangible rights (collectively
“Intellectual Property
Rights”) that may be conceived or developed by Executive either alone or
with others, during the Employment Period or any extension or renewal thereof,
whether or not conceived or developed during working hours, and with respect to
which any equipment, supplies, facilities, or trade secret information of the
Company or any Subsidiary or Affiliate was used, or that related to the business
of the Company or any Subsidiary or Affiliate or to the Company’s or any
Subsidiary’s or Affiliate’s actual or demonstrably anticipated research and
development, or that result from any work performed by Executive for the Company
or any Subsidiary or Affiliate, will be the sole property of the Company or a
Subsidiary of Affiliate, as applicable. As provided in Section 2870 of the
California Labor Code, the requirement to assign inventions hereunder shall not
apply to an invention that Executive develops entirely on his own time without
using the Company’s or any Subsidiary’s or Affiliate’s equipment, supplies,
facilities, or trade secret information, except for those inventions that either
(i) relate, at the time of conception or reduction to practice of the invention
to the Company’s or any Subsidiary’s or Affiliate’s business, or actual or
demonstrably anticipated research or development of the Company or any
Subsidiary or Affiliate; or (ii) result from any work performed by Executive for
the Company or any Subsidiary or Affiliate. Executive shall disclose to the
Company all Discoveries and Intellectual Property Rights conceived during the
Employment Period, or any extension or renewal thereof, which Executive believes
meet the criteria set forth in California Labor Code Section 2870, whether or
not the property of the Company or any Subsidiary or Affiliate under the terms
of the preceding sentence.
5
(f) All
Intellectual Property Rights that are subject to copyright protection and
reduced to tangible form in whole or in part by Executive in the course of his
employment shall be deemed to be a “work made for hire” as that term is used in
17 U.S.C. 101 et seq.,
and Executive shall take all actions reasonably requested by the Company in
order for the Company to obtain or register copyrights in such material.
Executive hereby assigns to the Company the entire right, title, and interest in
and to all Discoveries and all Intellectual Property Rights which are to be the
property of the Company or any Subsidiary or Affiliate under Section 4(e). Upon
request of the Company, whether during or following Executive’s employment,
Executive shall execute all such assignments, oaths, declarations, and other
documents as may be prepared by the Company to effect the purposes of this
paragraph. Upon request of the Company from time to time, whether during or
following Executive’s employment, Executive shall provide the Company with all
information, documentation, assistance, and other acts that the Company
reasonably may request to evidence, perfect, enforce, transfer, or defend the
Company’s proprietary rights in, to, or based upon Discoveries and/or
Intellectual Property Rights which are to be the property of the Company or any
Subsidiary or Affiliate under Section 4(e).
Executive shall provide all such information, documentation, assistance, and
other acts for no additional consideration other than actual and necessary
out-of-pocket expenses that are incurred at the Company’s request. Executive
hereby irrevocably designates and appoints the Company as his attorney-in-fact
and agent to act for and on his behalf to execute and file any document and to
do all other lawfully permitted acts to further the purposes of this paragraph
with the same legal force and effect as if executed by Executive.
(g) Executive
shall abide by policies related to his employment by the Company as they are
promulgated by the Company from time to time.
(h) Executive
has a personal contact database and computer that he will use for the benefit of
the Company. Such database and computer will remain the property of Executive.
Immediately upon the Termination Date, Executive shall provide the Company a
complete and accurate copy of such contact database and the Company and any
Subsidiary or Affiliate may continue to use it. All telephone and
cellular numbers used by Executive in performing services for the Company shall
be property of the Company, provided that if the employment of Executive is
terminated by the Company without Cause pursuant to Section 2(c) or by
Executive for Good Cause pursuant to Section 2(d), then
Executive may retain Executive’s cellular number.
(i)
Because the breach or attempted or threatened breach of this Section 4 may result
in immediate and irreparable injury to the Company for which the Company may not
have an adequate remedy at law, the Company shall be entitled, in addition to
all other remedies, to a decree of specific performance thereof and to a
temporary and permanent injunction enjoining such breach, without the necessity
of posting bond or furnishing any similar security. The parties’ obligations
under this Section
4 will survive any termination of Executive’s employment or this
Agreement.
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Section 5. Acknowledgments
By Executive.
Executive
understands that the restrictions contained in Section 4 may limit
the ability of Executive to earn a livelihood in a competing business, but
Executive nevertheless believes that Executive has received and will receive
sufficient consideration and other benefits as an employee of the Company and as
otherwise provided hereunder to clearly justify such restrictions which, in any
event (given the education, skills and ability of Executive), Executive does not
believe would prevent him from earning a livelihood. Executive
further acknowledges that this Agreement would not have been entered into and
the benefits described in Section 1 and Section 3 would not have been promised
in the absence of Executive’s promises under Section
4.
Section
6. Tax
Withholding.
The
Company may withhold from any compensation or severance payable under this
Agreement all federal, state, city or other taxes as shall be required pursuant
to any law or governmental regulation or ruling.
Section
7. Definitions.
(a) “Affiliate” means any
other Person controlling, controlled by, or under common control with the
Company, where “control” means the possession, directly or indirectly, of the
power to direct the management and policies of a Person whether through the
ownership of voting securities, by contract, or otherwise.
(b) “Agent” means any
Person which has received or is entitled to receive a commission from the
Company related to the sale or marketing of the Company’s products or
services.
(c) “Board” means the
Board of Directors of the Company.
(d) “Cause” means actions
or omissions by Executive: (i) constituting fraud, larceny, embezzlement,
conversion or otherwise involving the misappropriation of assets of the Company
or any other illegal conduct with respect to the Company which acts are harmful
to, either financially, or to the business reputation of, the Company; (ii)
constituting gross negligence or intentional misconduct; (iii) resulting in a
conviction (or a plea of guilty or no contest) for any felony or any crime of
moral turpitude; (iv) constituting habitual alcohol or substance abuse; (v)
constituting a material breach of this Agreement which, if curable, is not cured within
fifteen (15) days after receipt of written notice thereof; (vi) constituting a material failure by
Executive to perform his duties, which nonperformance continues after written
notice thereof and a fifteen (15) day chance to cure; (vii) resulting in an
unauthorized breach of the Company’s Code of Conduct; or (viii) constituting a
breach of the fiduciary duty owed by Executive to the Company or any Subsidiary
or Affiliate which, if curable, is not cured within
fifteen (15) days after receipt of written notice thereof.
(e) “Disability” means a
physical or mental infirmity which impairs Executive’s ability to perform
substantially his duties for a total period exceeding six (6) months during the
Employment Period or for a period of four (4) consecutive months. Disability
shall be determined by a physician acceptable to both the Company and Executive,
or, if the Company and Executive cannot agree upon a physician within 15 days
after the Company claims that Executive is suffering from a Disability, by a
physician selected by two physicians, one designated by each of the Company and
Executive. Executive’s failure to submit to any physical examination by any such
physician after such physician has given reasonable notice of time and place of
such examination shall be conclusive evidence of Executive’s inability to
perform his duties hereunder.
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(f) “Good Reason” means,
during the Employment Period and without Executive’s consent: (i) a material
diminution of Executive’s title, reporting structure, position or
responsibilities; (ii) a material reduction in the Base Salary; or (iii) any
other action or inaction by the Company that constitutes a material breach of
this Agreement. Executive shall communicate any purported termination by
Executive for Good Reason by a written Notice of Termination for Good Reason to the
Company in accordance with Section 8 of this
Agreement. For the purposes of this Agreement, a Notice of
Termination for Good Reason shall mean a notice by Executive specifying the
existence of one or more of the conditions described in this Section
7(f) within forty-five
(45) days after the initial existence of
the condition. Upon receipt of that notice, the Company shall have a
period of thirty (30) days to remedy the condition or conditions specified in
the Notice of Termination for Good
Reason. The Notice of
Termination for Good Reason must specify a
Termination Date of not more
than thirty (30) days after the last day of the Company’s cure
period. If the Company remedies the condition within the 30-day
period, the Notice of Termination for Good
Reason shall become ineffective and the
Company shall have no obligations under this Agreement as a result of
it.
(g) “Notice of
Termination” means a written notice that indicates the Termination Date,
the specific termination provision in this Agreement relied upon, and the facts
and circumstances, if any, claimed to provide a basis for such
termination.
(h) “Person” means an
individual, a partnership, a limited liability company, a corporation, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization and a governmental entity or any department, agency or political
subdivision thereof.
(i)
“Subsidiary” means any
corporation or other entity of which the securities having a majority of the
ordinary voting power in electing the board of directors (or similar governing
body or manager, as applicable) are, at the time as of which any determination
is being made, owned by the Company either directly or indirectly.
Section
8. Notices.
Any
notice provided for in this Agreement must be in writing and must be either
personally delivered, mailed by first class mail (postage prepaid and. return
receipt requested) or sent by reputable overnight courier service (charges
prepaid) to the recipient at the address below indicated:
If to the
Company:
C2 Global
Technologies Inc.
0 Xxxxxxx
Xxxxxx, Xxxxx 000
Xxxxxxx,
Xxxxxxx Xxxxxx X0X 0X0
Attention:
Chairman
If to
Executive:
Xxxx
Xxxxx
00000
Xxxx Xxxxxxxxx
Xxx
Xxxxxxx, 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. Any notice
under this Agreement will be deemed to have been given when so delivered or sent
or, if mailed, five days after deposit in the U.S. or Canadian
mail.
8
Section
9. Section
409A Savings Clause.
(a) Application of Section
409A. To the extent of any compliance issues or ambiguous terms, this
Agreement shall be construed in such a manner so as to comply with the
requirements of section 409A of the Code, and the rules set forth in this
Section 9 shall apply with respect to any payments (but only such payments)
that may be subject to section 409A of the Code notwithstanding any other
provision of this Agreement.
(b) Timing of
Payments. Notwithstanding the applicable provisions of this
Agreement regarding the timing of payments, any payment due hereunder which is
contingent upon receipt of the Release described in Section
3(e) shall be made, if at all, in accordance with this Section 9(b), and
only if Executive has delivered to the Company a properly executed Release for
which all legally mandated revocation rights of the Executive have
expired prior to the ninetieth (90th) day following the Termination
Date. Any such payment shall be made after receipt of such executed
and irrevocable Release within such ninety (90) period, unless otherwise
scheduled to be made after such period pursuant to the terms of this Agreement;
provided, however, if the ninety (90) day period for such payments begins in one
taxable year of Executive and ends in a second taxable year of Executive, any
payments otherwise payable within such ninety (90) day period will be made in
the second taxable year. Any payments due after such ninety (90)
period shall be payable in accordance with their regularly scheduled payment
date. All payments hereunder are subject to any required delay
pursuant to Section
9(c), if applicable. If the Company does not receive
a properly executed Release, for which all rights of revocation have lapsed,
prior to the time specified in this Section 9(b),
Executive shall forfeit all rights to any payments under Sections 3(c)(ii) and
3(d)(ii) of this Agreement.
(c) Delayed
Payments. (i) Notwithstanding any other payment schedule
provided herein to the contrary, if, and only if, Executive is deemed on the
Termination Date to be a “specified employee” within the meaning of that term
under section 409A(a)(2)(B) of the Code, then the terms of this Section
9(c) shall apply as required by section 409A of the Code. Any payment that
is considered deferred compensation under section 409A of the Code payable on
account of a “separation from service” shall be made on the date which is the
earlier of (y) the expiration of the six (6) month period measured from the date
of such “separation from service” of Executive or (z) the date of Executive’s
death (the “Delay
Period”) to the extent required under section 409A of the Code. Upon
the expiration of the Delay Period, all payments delayed pursuant to the
immediately preceding sentence (whether they otherwise would have been payable
in a single sum or in installments in the absence of such delay) shall be paid
to Executive in a lump sum by the Company, and all remaining payments due under
this Agreement shall be paid or provided in accordance with the normal payment
dates specified for them herein; and
(ii) To
the extent that any benefits to be provided during the Delay Period are
considered deferred compensation under section 409A of the Code provided on
account of a “separation from service,” and such benefits are not otherwise
exempt from section 409A of the Code, Executive shall pay the cost of such
benefits during the Delay Period, and the Company shall reimburse Executive, to
the extent that such costs otherwise would have been paid by the Company or to
the extent that such benefits otherwise would have been provided by the Company
at no cost to Executive, the Company’s share of the cost of such benefits upon
expiration of the Delay Period, and any remaining benefits shall be reimbursed
or provided by the Company in accordance with the procedures specified
herein.
(d) Separation from
Service. For purposes of this Agreement, the phrase
termination of employment or any similar term or phrase shall mean Executive’s
“Separation from Service” as defined by the default provisions of Treas. Reg. §
1.409A-1(h).
9
Section
10. General
Provisions.
(a) Severability.
Whenever possible, each provision of this Agreement will be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be invalid, illegal or unenforceable in any respect
under any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other provision or any other
jurisdiction, but this Agreement will be reformed, construed and enforced in
such jurisdiction as if such invalid, illegal or unenforceable provision had
never been contained herein. Notwithstanding the foregoing, if the
scope of any provision in Section 4 is found to
be too broad to permit enforcement of such provision to its full extent, the
parties consent to judicial modification of such provision and enforcement to
the maximum extent permitted by law.
(b) Complete Agreement.
This Agreement, those documents expressly referred to herein and other documents
of even date herewith embody the complete agreement and understanding among the
parties and supersede and preempt any prior understandings, agreements or
representations by or among the parties, written or oral, which may have related
to the subject matter hereof in any way.
(c) Counterparts. This
Agreement may be executed in separate counterparts, each of which is deemed to
be an original and all of which taken together constitute one and the same
agreement.
(d) Successors and
Assigns. Except as otherwise provided herein, this Agreement shall bind
and inure to the benefit of and be enforceable by Executive, the Company and
their respective successors and assigns; provided that the
rights and obligations of Executive under this Agreement shall not be
assignable.
(e) Choice of Law; Venue.
This Agreement will be governed by and construed in accordance with the laws of
the State of New York, without regard to conflict of laws
principles. Exclusive venue for any action arising out of or related
to this Agreement will be in state or federal court located in the County of New
York, New York, and each party consents to the jurisdiction of such courts and
waives any defense based on lack of personal jurisdiction or inconvenient
forum.
(f) Waiver of Jury
Trial. EACH PARTY IRREVOCABLY WAIVES ANY AND ALL RIGHTS IT MAY
HAVE TO DEMAND THAT ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR
RELATED TO THIS AGREEMENT BE TRIED BY JURY. EACH PARTY KNOWINGLY AND
VOLUNTARILY WAIVES ITS RIGHT TO DEMAND TRIAL BY JURY.
(g) Amendment and Waiver.
The provisions of this Agreement may be amended and/or waived only with the
prior written consent of the Company and Executive.
(h) Insurance. The
Company, at its discretion, may apply for and procure in its own name and for
its own benefit life and/or disability insurance on Executive in any amount or
amounts considered available. Executive agrees to cooperate in any medical or
other examination, supply any information, and to execute and deliver any
applications or other instruments in writing as may be reasonably necessary to
obtain and constitute such insurance. Executive hereby represents that he has no
reason to believe that his life is not insurable at rates now prevailing for
healthy men of his age.
(i) No Personal
Liability. For clarity, Executive will not have any personal
obligation or liability with respect to any of the debts, obligations or
liabilities of the Company.
* * * *
10
IN WITNESS WHEREOF, the parties hereto
have executed this Employment Agreement as of the Effective Date.
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C2
GLOBAL TECHNOLOGIES INC.
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By:
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/s/ Xxxxx X. Xxxxxx
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Name:
Xxxxx X. Xxxxxx
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Its:
Chairman & CEO
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/s/ Xxxx Xxxxx
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Xxxx
Xxxxx
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11
