Exhibit 10.35
EMPLOYMENT AGREEMENT
AGREEMENT dated as of the 1st day of January 2005, between Brooklyn
Cheesecake & Desserts Company, Inc., a New York corporation, with an
office at 00 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxxxx 00000 (the "Company"),
and Xxxxxxx X. Xxxxxxx, residing at 00 Xxxxxxxxx Xxxx, Xxxxxxx, Xxx Xxxx
00000 (the "Employee").
WITNESSETH:
WHEREAS, the Company desires to employ the Employee as the Chief Financial
Officer, and the Employee is willing to continue such employment for a
period of three (3) years from the date of this Agreement, all on the
terms hereinafter set forth;
NOW, THEREFORE, the parties agree as follows:
1. Employment. The Company hereby employs the Employee as its Chief
Financial Officer on the terms set forth hereinafter until the
Expiration Date of this Agreement, subject to any earlier
termination as provided for by this Agreement, and the Employee
hereby accepts such employment. The Expiration Date of this
Agreement shall be the third anniversary of the date of this
Agreement. Except as otherwise provided for in this Agreement, in
the event the Company terminates employment of the Employee for
"Cause" or the Employee wrongfully terminates this Agreement or the
Company terminates this Agreement because of the material breach of
this Agreement by the Employee, the Company shall be not be liable
to perform its obligations under the terms of this Agreement.
"Cause" means a breach of fiduciary duty or duty of loyalty to the
Company, misappropriation of any asset or opportunity of the
Company, failure to perform one's duties (other than because of the
Company's failure to pay compensation as provided in this Agreement
or because of illness, accident, or other disability to the extent
permitted in this Agreement), failure to perform one's duties in a
competent manner, any other material breach of this Agreement, or
indictment for any felony regardless of whether the charge relates
to the Company. Except as otherwise provided for in this Agreement,
in the event that the Company terminates employment of the Employee
without Cause or wrongfully terminates this Agreement or the
Employee terminates this Agreement because of the material breach of
this Agreement by the Company, the Company shall be liable to
perform its obligations under the terms of this Agreement, which
shall include making payments to the Employee pursuant to Section 4
of this Agreement until the Expiration Date, and the Company shall
pay the Employee severance pay in the amount of Ninety-six Thousand
United States Dollars (U.S.$96,000), which shall be in addition to
any amounts that may be paid to the Employee pursuant to this
Agreement or under law.
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2. Duties. During his employment, the Employee shall have the title and
serve as the Chief Financial Officer of the Company and shall
perform such reasonable executive duties compatible with his
position. The office of the Company located at 00 Xxxxxxx Xxxxxx,
Xxxxxxxxx, Xxx Xxxxxx 00000 shall constitute the Employee's base of
operations. The Company may change the base of operations to
anywhere within a radius of fifty (50) miles from the Company's
present location, and the Employee shall not be required to render
services on a permanent basis outside of this area. The Employee,
though, shall render services away from this area on a temporary
basis and travel wherever the Company may reasonably require. If
elected a director or officer of the Company or of any affiliate of
the Company, the Employee shall serve in that capacity without
compensation other than as expressly provided in this Agreement.
3. Extent of Services. The Employee will devote substantially all of
his working time to performing his duties under this Agreement, and
during his employment with the Company the Employee will not (i) act
for his own account in any manner which is competitive with any of
the business of the Company or which would interfere with the
performance of his duties under this Agreement, or (ii) serve as an
officer, director or employee of or advisor to any other business
entity which is competitive with any of the business of the Company,
or (iii) invest or have any financial interest, direct or indirect,
in any business competitive with any of the business of the Company,
provided, however, that notwithstanding the foregoing, the Employee
may own up to 1% of the outstanding equity securities of any company
engaged in any such competitive business whose shares are listed on
a national securities exchange or regularly quoted in an
over-the-counter market by one or more members of a national or an
affiliated securities association. The Employee will be deemed to
have an indirect financial interest in any business in which any of
the following has any financial interest: the Employee's spouse or
any lineal descendant or ancestor of the Employee. The Employee may
make personal and business investments, engage in personal and
business ventures, enter into other business relationships, and own,
operate, or manage businesses that require minimal portions of the
Employee's working day, provided that such activities do not
interfere with and are not inconsistent with his duties hereunder
and are not competitive with any business of the Company.
4. Compensation.
4.1. Salary. The Company shall pay the Employee a salary at the rate of
Ninety-six Thousand United States Dollars (U.S.$96,000) per year.
Forty-eight Thousand United States Dollars (U.S. $48,000) shall
payable be in cash in equal, weekly installments, and Forty-eight
Thousand United States Dollars (U.S. $48,000) shall be payable in
either cash or stock, which manner of payment shall be decided upon
by mutual agreement between the Company and the Employee. In the
event that the Company and Employee mutually agree to have a portion
of compensation paid in stock, then the stock price upon which
compensation shall be based will be the fair market value of the
Company's common shares averaged over the twenty (20) trading days
immediately preceding the date the Company and the Employee agree to
pay the Employee in stock. Thereafter the Company shall review the
Employee's salary at least annually, but in any event, although the
Company may increase, decrease, or not change the Employee's salary,
his salary shall not at any time be less than Ninety-six Thousand
United States Dollars (U.S.$96,000) per year. The Employee shall not
be entitled to overtime or other additional compensation as a result
of services performed during evenings, weekends, or at other times.
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4.2. Additional Compensation. The Company may pay the Employee, as
additional compensation, a bonus of up to 250% of the salary of the
Employee. The Compensation Committee of the Board of Directors shall
determine the amount of the bonus. Any such bonus that may be
awarded shall be based upon performance-based criteria and goals as
established by the Compensation Committee. The Company shall pay any
amount owing to the Employee under this Section 4.2 within thirty
(30) days after the award of the bonus by the Compensation
Committee.
4.3. Deductions. The Company shall deduct and withhold from any
compensation payable to the Employee under this Agreement such
amounts as the Company is required to deduct and withhold by law.
The Company may also deduct and withhold from any such compensation,
to the extent permitted by law, such amounts as the Employee may owe
to the Company.
4.4. Option Agreement. The Company shall grant the Employee options (the
"Options") to purchase Two Hundred Thousand (200,000) common shares
of the Company at the price of Eights Cents ($.08) per share.
5. Expenses.
5.1. The Company shall reimburse the Employee for all proper, normal, and
reasonable expenses incurred by the Employee in performing his
obligations under this Agreement upon the Employee's furnishing the
Company with reasonably satisfactory evidence of such expenditures.
The Employee shall not incur any unusual or major expenditures
without the Company's prior written approval. Without limiting the
foregoing, the Employee shall not, without the Company's prior
written approval, incur any travel expenses (including the cost of
transportation, meals, and lodging) in excess of Fifteen Thousand
United States Dollars (U.S.$15,000) in the aggregate for any one
trip. Notwithstanding anything else to the contrary in this
Agreement, the obligation of the Company to reimburse the Employee
for expenses duly incurred pursuant to this Section 5.1 shall
survive the termination or expiration of this Agreement and the
death or disability of the Employee.
6. Benefits.
6.1. The Company shall provide the Employee, at the Company's expense,
with medical, hospital, and disability insurance that is not less
favorable than that which it provides to any other executive
employee of the Company.
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6.2. The Employee shall be entitled to 20 days vacation during each
calendar year (January 1 to December 31) in addition to weekends and
any holidays that the Company observes. Unused vacation days and
holidays may be accrued from one year to the next up until the
earlier of the termination or expiration of this Agreement. At the
Employee's sole option, the Company shall pay the Employee for any
unused vacation days and holidays that may have accrued to the end
of any calendar year or the earlier of the termination or expiration
of this Agreement within three (3) days after the Employee provides
the Company with written notice of the amount due pursuant to this
Section 6.2. In the event of the Employee's death or disability, the
Company shall pay the Employee for any unused vacation days and
holidays that may have accrued up until the date of death or
disability of the Employee within three (3) days of any such date.
The amount due for each unused vacation day or holiday shall be
calculated by dividing the Employee's annual salary then in effect
by two hundred thirty (230) days.
6.3. The Employee's salary and other rights and benefits under this
Agreement shall not be suspended or terminated because the Employee
is absent from work due to illness, accident or other disability;
but the Company may deduct from the Employee's salary under Section
4.1 any payment received by the Employee under any disability
insurance purchased by the Company, other than disability insurance
mandated by applicable state law, which the Company provides the
Employee pursuant to Section 6.1 (the "Disability Insurance
Payment"). In calculating deductions to the Employee's salary,
Disability Insurance Payments shall first be apportioned to the
weekly pay periods and then deducted from the weekly salary
installments due the Employee pursuant to Section 4.1. In no event
shall Disability Insurance Payments received by the Employee from
any insurance company be used to reduce any other amounts that may
be due to the Employee during or after the termination or expiration
of this Agreement. The provisions of this Section 6.3 shall not
limit or affect the rights of the Company under Section 7.
7. Death And Disability.
7.1. If the Employee dies prior to expiration of the term of his
employment, all obligations of the Company to the Employee shall
cease as of the date of the employee's death except as otherwise
provided for in this Agreement.
7.2. If the Employee is unable to perform substantially all of his duties
under this Agreement because of illness, accident, or other
disability (collectively referred to as "Disability"), and the
Disability continues for more than three (3) consecutive months or
an aggregate of more than six (6) months during any 12-month period,
then the Company may suspend its obligations to the Employee under
Sections 4.1 and 4.2 for a period of up to three (3) months (the
"Suspension Period"). The Suspension Period will commence on the
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date the Company sends the Employee a written notice stating that
Suspension Period has commenced (the "Suspension Commencement
Date"). The Suspension Period shall terminate at such time that the
Disability has, in fact, ended and the Employee has returned to the
Company and performs substantially all his duties under this
Agreement at which time the suspension of the Company's obligations
under Sections 4.1 and 4.2 shall end. In the event that the
Disability has not ended and the Employee has not returned to the
Company and does not perform substantially all his duties under this
Agreement before the end of the Suspension Period, the Company shall
have the right to terminate the Employee upon written notice.
7.3. If the Company suspends its obligations under Section 7.2, then for
each year ending December 31 during which such suspension is in
effect, the additional compensation, if any, to which the Employee
is entitled under Section 4.2 shall be that amount which bears the
same ratio to the additional compensation to which the Employee
would otherwise have been entitled as the number of days in such
year during which the suspension was not in effect bears to the
total number of days in such year.
7.4. If the Employee or the Company asserts at any time that the Employee
is suffering a Disability, the Company may cause the Employee to be
examined by a doctor or doctors selected by the Company, and the
Employee shall submit to all required examinations and shall
cooperate fully with such doctor or doctors and, if requested to do
so, shall make available to them his medical records. The Employee's
own doctor may be present at any such examinations.
8. Results Of The Employee's Services.
8.1. The Company shall be entitled to and shall own all the results and
proceeds of the Employee's services under this Agreement, including,
without limitation, all rights throughout the world to any
copyright, patent, trademark, or other right and to all ideas,
inventions, products, programs, procedures, formats, and other
materials of any kind created or developed or worked on by the
Employee during his employment by the Company; the same shall be the
sole and exclusive property of the Company; and the Employee shall
not have any right, title, or interest of any nature or kind
therein. Without limiting the foregoing, it shall be presumed that
any copyright, patent, trademark, or other right and any idea,
invention, product, program, procedure, format or material created,
developed, or worked on by the Employee at any time during the term
of his employment shall be a result or proceed of the Employee's
services under this Agreement. The Employee shall take such action
and execute such documents as the Company may request to warrant and
confirm the Company's title to and ownership of all such results and
proceeds and to transfer and assign to the Company any rights which
the Employee may have therein.
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8.2. The Employee acknowledges that the violation of any of the
provisions of Section 8.1 shall cause irreparable loss and harm to
the Company which cannot be reasonably or adequately compensated by
damages in an action at law, and, accordingly, that the Company
shall be entitled, without posting bond or other security, to
injunctive and other equitable relief to enforce the provisions of
that Section; but no action for any such relief shall be deemed to
waive the right of the Company to an action for damages. The
Employee acknowledges that he shall not be entitled to any property
rights or co-ownership rights in any assets, intellectual property
rights, contracts, customer lists, goodwill, copyright, patent,
trademark, or other right or in any opportunity, ideas, inventions,
products, programs, procedures, formats, and other materials of any
kind belonging to the Company or created, developed, or worked on by
the Employee during his employment by the Company.
9. Change of Control of the Company.
9.1. If any group of business entities or individuals, which in
combination with each other number six (6) or fewer, obtains control
of the Company as a result of a sale of stock, merger, sale of
substantially all the assets of the Company, or otherwise, then the
Employee, at his sole discretion, shall have the right to terminate
this Agreement.
9.2. In the event that the membership of the Board of Directors of the
Company changes in such a way that the current Board Members duly
serving on the Board of Directors as of the date of this Agreement
no longer comprise more than two thirds (?) of the membership of the
entire Board of Directors, exclusive of any New Board Member or
Board Members added to the Board of Directors who were appointed,
nominated, or elected through the efforts of the Employee, then the
Employee, at his sole discretion, shall have the right to terminate
this Agreement.
9.3. If the Employee elects to terminate this Agreement pursuant to this
Sections 9.1 and 9.2, the Company shall pay in full to the Employee
all the amounts and perform all its obligations due the Employee as
if the Employee had fully performed his obligations under this
Agreement up until the Expiration Date of this Agreement, and the
Employee shall be relieved of any future duty to perform pursuant to
this Agreement thereafter.
9.4. Any termination made by the Employee pursuant to Sections 9.1 and
9.2 shall be effective as of the date the notice of such termination
is sent to the Company pursuant to Section 17.4.
9.5. For purposes of Section 9.1, "control of the Company" shall mean a
50% ownership interest in the Company or 50% control of the voting
rights of all classes of shares of the Company.
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10. Insurance. If the Company desires at any time or from time to time to
apply for, in its own name or otherwise, but at its expense, life, health,
accident or other insurance covering the Employee, the Company may do so
and may take out such insurance for any sum that it deems desirable. The
Employee shall have no right, title or interest in or to such insurance.
The Employee nevertheless shall assist the Company in procuring the same
by submitting from time to time to the customary medical, physical and
other examinations, and by signing such applications, statements and other
instruments as any reputable insurer may require.
11. No Requirement for Employee to Mitigate Damages. If the Company wrongfully
terminates the Employee, or if the Employee terminates his employment
because of material breach of this Agreement by the Company, or if the
Employee terminates this Agreement pursuant to Section 9 of this
Agreement, then the Employee shall not be required to mitigate damages and
any income received or earned by the Employee from any source whatsoever
after termination of this Agreement shall not reduce the amount of damages
obtainable by the Employee from the Company.
12. Negative Covenant. The Employee shall not, during or after the term of
this Agreement, disclose to any third person or use or take any personal
advantage of any confidential information or any trade secret of any kind
or nature obtained by him during the term hereof.
13. Governing Law; Remedies.
13.1. This Agreement shall be governed by and construed in all respects in
accordance with the laws of the State of New York, except that no
choice of law doctrine shall be used to apply the laws of another
jurisdiction.
13.2. The Company and the Employee submit to the jurisdiction of the
courts of the State of New York and of the United States located in
the County of New York, State of New York, and each agrees not to
raise and waives any objection to or defense based on the venue of
any such court or forum non conveniens.
13.3. The Company shall be entitled to injunctive and other equitable
relief from the courts as provided in Section 8.2 and as the courts
may otherwise determine appropriate; and the Employee agrees that it
shall not be a defense to any request for such relief that the
Company has an adequate remedy at law.
13.4. A court of competent jurisdiction, if it determines any provision of
this Agreement to be unreasonable in scope, time, or geography, is
hereby authorized by the Employee and the Company to enforce the
same in such narrower scope, shorter time, or lesser geography as
such court determines to be reasonable and proper under all the
circumstances.
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13.5. The respective rights and remedies of the parties are cumulative,
and the exercise or enforcement of any one or more of them shall not
preclude the parties from exercising or enforcing any other right or
remedy.
14. Indemnity.
14.1. To the extent permitted by law, the Company shall indemnify the
Employee against any claim or liability and shall hold the Employee
harmless from and pay any expenses (including, without limitation,
legal fees and court costs), judgments, fines, penalties,
settlements and other amounts arising out of or in connection with
any act or omission of the Employee performed or made in good faith
on behalf of the Company pursuant to this Agreement, except for acts
of gross negligence or willful misconduct or criminal acts. The
Company shall not be obligated to pay the Employee's legal fees and
related charges of counsel during any period that the Company
furnishes, at its expense, counsel to defend the Employee; but any
counsel furnished by the Company must be reasonably satisfactory to
the Employee. The foregoing provisions shall survive termination of
the Employee's employment with the Company for any reason whatsoever
and regardless of fault.
14.2. Without limitation to the foregoing, the Company shall provide the
Employee with coverage under the Company's officers' and directors'
liability insurance policy, which shall contain such terms and
conditions as agreed upon by the Company, covering acts or omissions
by the Employee in the performance of his duties to the Company
under this Agreement as an officer and, if he serves as such, as a
director of the Company. If such insurance is not occurrence-based,
the Company shall continue insurance coverage for any potential
claims that may be made against the Employee pursuant to this
Section 14 for a period of one (1) year after his employment with
the Company terminates for any reason, except for acts of gross
negligence or willful misconduct or criminal acts. The Company's
insurance policy shall protect against and pay $1,000,000 for each
loss and in aggregate for all losses (inclusive of defense costs,
charges, and expenses) for each policy period with a retention of
$150,000 for each claim. The Employee shall have nonexclusive
coverage under the Company's directors' and officers' liability
insurance policy as an "Insured Person," which definition shall
include, but not be limited to, any past, present, or future
director or officer of the Company. The Employee acknowledges that
any payments that may be made pursuant to the directors' and
officers' liability insurance policy may be limited as a result of
payments made to any other past, present, or future director or
officer of the Company, retention limits, and coverage limits.
15. Severability. If any provision of this Agreement or the application
of any such provision to any person or circumstance is held invalid,
the remainder of this Agreement, and the application of such
provision other than to the extent it is held invalid, shall not be
invalidated or affected thereby.
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16. Waiver. No failure by the parties to this Agreement to insist upon
the strict performance of any term or condition of this Agreement or
to exercise any right or remedy available to them shall constitute a
waiver. No breach or default of any provision of this Agreement
shall be waived, altered, or modified, and the parties may not waive
any of its rights, except by a duly executed written instrument. No
waiver of any breach or default shall affect or alter any term or
condition of this Agreement, and such term or condition shall
continue in full force and effect with respect to any other then
existing or subsequent breach or default thereof.
17. Miscellaneous.
17.1. Amendments. This Agreement may be amended only by an instrument in
writing signed by the Company and the Employee.
17.2. Binding Effect; Assignment. Neither the Company nor the Employee
may, without the other's prior written consent, transfer or assign
any of its or his rights or obligations under this Agreement, and
any such transfer or assignment or attempt thereat without such
consent shall be null and void. In the event that the Company does
transfer or assign any of its rights and obligations under this
Agreement with the prior written consent of the Employee pursuant to
this Section 17.2, such assignment and transfer shall be enforceable
provided that the Company shall not be released from any of its
obligations under this Agreement, and any transferee or assignee
shall agree in writing to assume all the obligations of the Company
hereunder.
17.3. Successors. This Agreement shall be binding upon and inure to the
benefit of permitted successors and assigns, heirs, executors, and
administrators of the respective parties.
17.4. Notices. All notices under or in connection with this Agreement
shall be in writing and may be delivered personally or sent by
certified or registered mail, return receipt requested, by a
recognized overnight courier, or by facsimile transmission to the
parties at their addresses and facsimile numbers set forth below or
to such other addresses and fax numbers as to which notice is given:
(a) if to the Company:
Brooklyn Cheesecake & Desserts Company, Inc.
00 Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Facsimile: 000-000-0000
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(b) if to the Employee:
Xxxxxxx X. Xxxxxxx
00 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxx Xxxx 00000
Facsimile: 000-000-0000
Notice shall be deemed given upon receipt.
17.5. Headings. Section headings are for purposes of convenient reference
only and shall not affect the meaning or interpretation of any
provision of this Agreement.
17.6. Entire Agreement. This Agreement constitutes the entire agreement of
the parties and supersedes any and all prior agreements or
understandings, whether written or oral, between them. There are no
restrictions, promises, representations, warranties, covenants, or
undertakings, other than those expressly set forth or referred to
herein.
17.7. Pronouns. All pronouns and any variation thereof shall be deemed to
refer to the masculine, feminine, or neuter, singular or plural, as
the identity of the person or persons may require.
17.8. Rules of Construction. Each of the parties hereto has reviewed this
Agreement and agrees that the normal rule of construction that any
ambiguity or uncertainty in a writing be interpreted against the
party drafting the writing shall not apply in any action or
proceeding involving this Agreement.
17.9. Acknowledgment. The parties hereto acknowledge that they have read
and understand this Agreement and agree to be bound by its terms and
conditions. Employee acknowledges that he has been duly informed
that he should review this Agreement with his independent counsel.
Employee further acknowledges that he has had the opportunity to
consult with his independent counsel.
17.10.Execution. This Agreement may be executed in counterparts, and as
so executed shall constitute one agreement binding on the parties.
NO FURTHER TEXT ON THIS PAGE
SIGNATURE PAGE FOLLOWS
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.
Company:
Brooklyn Cheesecake & Desserts Company, Inc.
By:
----------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
Employee:
By:
----------------------------
Name: Xxxxxxx X. Xxxxxxx
CONFIRMATION
IN WITNESS WHEREOF, on behalf of and upon due authorization from the Board of
Directors of Brooklyn Cheesecake & Desserts Company, Inc. ("Company"), the
director below has read and understands, and hereby approves, confirms, and
ratifies this Agreement on behalf of the Board of Directors as of the date first
written above; and the director below further approves, confirms, and ratifies
on behalf of the Board of Directors the execution and delivery of this Agreement
and all the acts by Xxxxxx X. Xxxxxxx performed on behalf of the Company in
connection with this Agreement.
By:
----------------------------
Name: Xxxxxxx X. Xxxx
Title: Director
