EXHIBIT 10.7
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EMPLOYMENT AGREEMENT
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EMPLOYMENT AGREEMENT (this "Agreement"), entered into as of this ____ day of
October, 1998, by and between MILLENNIUM SPORTS MANAGEMENT, INC., a New Jersey
corporation having offices at 00 Xxxxxxxxxxxx Xxxxx, X.X. Xxxxxxx 000 and Xxxxxx
Xxxxx 000, X.X. Xxx 000, Xxxxxxx, Xxx Xxxxxx 00000-0000 (the "Company"), and
XXXXXX X. XXXXXXX, XX., an individual residing at 00 Xxxxxx Xxx, Xxxxxxx, Xxx
Xxxxxx 00000 (the "Employee");
W I T N E S S E T H :
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WHEREAS, the Company is engaged in the business of operating a regional sports
entertainment and recreation center, including a 4,300 seat baseball stadium,
indoor recreation center, sporting goods store, and related facilities; and
WHEREAS, the Employee has heretofore been, and is currently, employed and
serving as a Vice President and the Chief Financial Officer of the Company
pursuant to an employment agreement which is due to expire on October 31, 1998;
and
WHEREAS, to promote the ongoing business of the Company, the Company desires
to assure itself of the continued right to the Employee's services on the terms
and conditions of this Agreement; and
WHEREAS, the Employee is willing and able to render his services to the
Company on the terms and conditions of this Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the parties hereby agree as follows:
1. Nature of Employment.
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(a) Subject to the terms and conditions of this Agreement, the Company
shall, throughout the term of this Agreement, retain the Employee, and the
Employee shall render services to the Company, in the capacity and with the
title of Vice President and Chief Financial Officer of the Company. In such
capacity, the Employee shall have and exercise responsibility for (i) overseeing
all financial and accounting matters relating to the Company and its business
and operations, (ii) participating in corporate planning and development
strategy for the Company, (iii) advising on and participating and assisting in
corporate finance and shareholder relations matters relating to the Company, and
(iv) such additional duties as may be assigned to the Employee from time to time
by the President of the Company and/or by the Board o f
Directors of the Company (the "Board"). The Employee may be given additional
titles and related responsibilities (including, without limitation, as Secretary
of the Company) as determined by the Board, and the Employee shall perform such
duties and responsibilities without requirement of additional compensation.
(b) Throughout the period of his employment hereunder, the Employee shall:
(i) devote his full business time, attention, knowledge and skills, faithfully,
diligently and to the best of his ability, to the active performance of his
duties and responsibilities hereunder on behalf of the Company; (ii) observe and
carry out such reasonable rules, regulations, policies, directions and
restrictions as may be established from time to time by the Board, including but
not limited to the standard policies and procedures of the Company as in effect
from time to time; and (iii) do such traveling as may reasonably be required in
connection with the performance of such duties and responsibilities; provided,
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however, that the Employee shall not be assigned to regular duties that would
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reasonably require him to relocate his permanent residence from that first set
forth above.
(c) Anything contained in paragraph 2(b) above to the contrary
notwithstanding, the Employee may (i) devote portions of this personal time to
community and charitable activities, so long as same does not interfere with the
performance of the Employee's duties and responsibilities hereunder, and (ii)
make passive investments of his personal funds (including, without limitation,
in securities of publicly traded entities), so long as such investments do not
otherwise constitute or entail a violation of paragraph 6 below.
2. Term of Employment.
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(a) Subject to prior termination in accordance with paragraph 2(b) below,
the term of this Agreement and the Employee's employment hereunder shall
commence on November 1, 1998 and shall continue through and including December
31, 1999, and shall thereafter automatically renew for additional terms of one
(1) year each unless either party gives written notice of termination to the
other party not less than ninety (90) days prior to the end of any term (in
which event this Agreement shall terminate effective as of the close of such
term).
(b) This Agreement:
(i) may be terminated upon mutual written agreement of the Company
and the Employee;
(ii) may be terminated at the option of the Employee, upon fourteen
(14) days' prior written notice to the Company, in the event that the Company
shall (A) fail to make any payment to the Employee required to be made under the
terms of this Agreement within thirty (30) days after payment is due, (B) fail
to perform any other material covenant or agreement to be performed by it
hereunder or take any action prohibited by this Agreement, and fail to cure or
remedy same within thirty (30) days after written notice thereof to the Company,
or (C) for any reason discontinue substantially all of its business operations
for any period in excess of six (6) consecutive months;
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(iii) may be terminated at the option of the Company, upon written
notice to the Employee, "for cause" (as hereinafter defined);
(iv) may be terminated at the option of the Company in the event of
the "permanent disability" (as hereinafter defined) of the Employee; or
(v) shall automatically terminate, without requirement of any
notice, upon the death of the Employee.
(c) As used herein, the term "for cause" shall mean and be limited to:
(i) any willful and material breach of this Agreement (including, without
limitation, the covenants contained in paragraph 6 below) by the Employee which
in any case is not fully corrected within thirty (30) days after written notice
of same from the Company to the Employee; (ii) gross neglect by the Employee of
his duties and responsibilities hereunder; (iii) any fraud, criminal misconduct,
breach of fiduciary duty, dishonesty, or gross and willful misconduct by the
Employee in connection with the performance of his duties and responsibilities
hereunder; (iv) the Employee being legally intoxicated during business hours or
while on call, or being habitually drunk or addicted to drugs (provided that
this shall not restrict the Employee from taking physician-prescribed medication
in accordance with the applicable prescription); (v) the commission by the
Employee of any felony or crime of moral turpitude, the making by the Employee
of any material written or verbal statements which are intentionally disparaging
to or derogatory of the Company, or any other action by the Employee which may
materially impair or damage the reputation of the Company; or (vi) habitual
breach by the Employee of any of the material provisions of this Agreement
(regardless of any prior cure thereof).
(d) As used herein, the term "permanent disability" shall mean, and be
limited to, any physical or mental illness, disability or impairment that
prevents the Employee from continuing the performance of his normal duties and
responsibilities hereunder for a period in excess of six (6) consecutive months.
For purposes of determining whether a "permanent disability" has occurred under
this Agreement, the written determination thereof by two (2) qualified
practicing physicians selected and paid for by the Company (and reasonably
acceptable to the Employee) shall be conclusive.
(e) Upon any termination of this Agreement as hereinabove provided, the
Employee (or his estate or legal representatives, as the case may be) shall be
entitled to receive any and all unpaid Base Salary appropriately prorated to and
as of the effective date of termination (based on the number of days elapsed
prior to the date of termination), any other amounts then due and payable to the
Employee hereunder, and any bonus (prorated, if applicable) thereafter payable
pursuant to paragraph 3(b) below. All such payments shall be made on the next
applicable payment date therefor (as provided in paragraph 3 below) following
the effective date of termination. Such payments shall constitute all amounts to
which the Employee shall be entitled hereunder upon termination of this
Agreement.
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3. Compensation and Benefits.
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(a) Base Salary. As compensation for his services to be rendered
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hereunder, the Company shall pay to the Employee a base salary at the rate of
Seventy-Eight Thousand ($78,000) Dollars per annum (the "Base Salary"), which
shall be payable in periodic installments in accordance with the standard
payroll practices of the Company in effect from time to time, and shall be
subject to withholding and deduction for federal, state and local taxes,
unemployment insurance, social security and other legally required withholdings.
At the sole and absolute discretion of the Board, such Base Salary may be
reviewed and upwardly adjusted at any time and from time to time.
(b) Bonus Plan. Within a reasonable time after the date hereof, the
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Company (acting through or with the approval of the Board) shall establish a
bonus plan for the benefit of its management and/or directors, on such terms and
conditions as the Board may approve in its discretion; provided, however, that
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any and all payments under such plan shall be subject to, and shall only be
payable out of, any positive cash flow from operations in the Company's fiscal
year ending December 31, 1999. Nothing herein contained shall be deemed to
guarantee or assure that any payments will be made to the Employee under such
plan, except that, unless this Agreement is terminated "for cause," the Employee
shall be entitled to receive, if, as, when and to the extent that any payment
under such plan is made to the President of the Company, an amount equal to such
payment made to the President of the Company. Any such payment to the Employee
shall be made regardless of any expiration or termination of this Agreement,
provided that (i) no payment shall be required if this Agreement is terminated
"for cause," and (ii) if this Agreement is otherwise terminated prior to
expiration, any such payment shall be prorated based on the number of days in
calendar 1998 that the Employee was employed hereunder.
(c) Fringe Benefits. The Company shall also make available to the
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Employee, throughout the period of his employment hereunder, such benefits and
perquisites as are generally provided by the Company to its executive employees,
including but not limited to eligibility for participation in any group
insurance plan, pension plan, profit-sharing plan, retirement savings plan,
401(k) plan, or other such benefit plan or policy which may presently be in
effect or which may hereafter be adopted by the Company for the benefit of its
executive employees; provided, however, that nothing herein contained shall be
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deemed to require the Company to adopt or maintain any particular plan or
policy.
(d) Expenses. Throughout the period of the Employee's employment
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hereunder, the Company shall also reimburse the Employee, upon presentment by
the Employee to the Company of appropriate records, receipts and vouchers
therefor, for any reasonable out-of-pocket business expenses incurred by the
Employee in connection with the performance of his duties and responsibilities
hereunder; provided, however, that no reimbursement shall be required to be made
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for any expense which is not properly deductible (in whole or in part) by the
Company for income tax purposes, or for any expense item which has not
previously been approved if and to the extent required in accordance with the
Company's standard policies and procedures in effect from time to time.
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4. Vacation, etc.
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(a) The Employee shall be entitled to take, from time to time, up to
three (3) weeks of paid vacation per year, to be taken at such times as shall be
mutually convenient to the Employee and the Company, and so as not to interfere
unduly with the conduct of the business of the Company.
(b) The Employee shall further be entitled to paid holidays, personal
days and sick days in accordance with the Company's standard policies and
procedures in effect from time to time.
5. Company Property.
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(a) The Employee hereby acknowledges and confirms that all ideas and
other developments or improvements conceived by the Employee, whether alone or
with others, during the period of his employment hereunder (whether or not
during working hours), that are within the scope of the Company's business
operations or that relate to any business of any type conducted or proposed to
be conducted by the Company, constitute the exclusive property of the Company.
The Employee shall assist the Company as required in order to establish, confirm
and evidence the Company's ownership of such ideas, developments and
improvements, and shall execute and deliver any and all such agreements,
instruments and other documents as may be necessary or appropriate in connection
therewith.
(b) Upon termination of this Agreement under any circumstances, and
otherwise upon request of the Company, the Employee shall immediately return all
property of the Company utilized by the Employee in rendering services
hereunder, to the extent in the Employee's possession or under his control.
6. Restrictive Covenants.
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(a) The Employee hereby acknowledges and agrees that (i) the business
contacts, customers, suppliers, know-how, trade secrets, marketing techniques,
promotional methods and other aspects of the business of the Company have been
and are of value to the Company, and have provided and will hereafter provide
the Company with substantial competitive advantage in the operation of its
business, and (ii) by reason of his employment with the Company, he will have
detailed knowledge and will possess confidential information concerning the
business and operations of the Company. The Employee hereby further acknowledges
that his business skills are not uniquely suited to businesses of the type
conducted by the Company, and that, if required, he could readily adapt and
utilize such skills in one or more other types of businesses.
(b) The Employee shall not, directly or indirectly, for himself or
through or on behalf of any other person or entity:
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(i) at any time, divulge, transmit or otherwise disclose or cause to
be divulged, transmitted or otherwise disclosed, any business contacts, customer
or supplier lists, know-how, trade secrets, marketing techniques, promotional
methods, contracts or other confidential or proprietary information of the
Company of whatever nature, whether now existing or hereafter created or
developed (provided, however, that for purposes hereof, information shall not be
considered to be confidential or proprietary if (A) it is a matter of common
knowledge or public record, (B) it is generally known in the industry, or (C)
the Employee can demonstrate that such information was already known to the
recipient thereof other than by reason of any breach of any obligation under
this Agreement or any other confidentiality or non-disclosure agreement); and/or
(ii) at any time during the period from the date hereof through and
including the date of the termination of the Employee's employment with the
Company, and for an additional period of one (1) year thereafter, (A) invest,
carry on, engage or become involved, either as an employee, agent, advisor,
officer, director, stockholder (excluding passive ownership of not more than 5%
of the outstanding shares of a publicly held corporation if such ownership does
not involve managerial or operational responsibility), manager, partner, joint
venturer, participant or consultant, in any business enterprise (other than the
Company and/or its affiliates, successors or assigns) which is located or
operating in Sussex County, New Jersey and/or any county contiguous thereto, and
derives any material revenues from any type of sports-related business engaged
in by the Company or any of its affiliates at the time that the Employee
proposes to become involved in such other business enterprise, and/or (B) induce
or attempt to induce any employee of the Company to leave the employ of the
Company, or in any way interfere with the Company's relationship with any of its
employees; provided, however, that the restrictions pursuant to clause (A) of
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this paragraph 6(b)(ii) shall not thereafter be applicable in the event that,
and from and after such time as, (x) the Company terminates the Employee's
employment other than "for cause," or (y) this Agreement is terminated by reason
of any election by the Company not to renew this Agreement in accordance with
paragraph 2(a) above.
(c) The Employee and the Company hereby acknowledge and agree that any
breach by the Employee, directly or indirectly, of the foregoing restrictive
covenants will cause the Company irreparable injury for which there is no
adequate remedy at law. Accordingly, the Employee expressly agrees that, in the
event of any such breach or any threatened breach hereunder by the Employee,
directly or indirectly, the Company shall be entitled, in addition to any and
all other remedies available, to seek and obtain injunctive and/or other
equitable relief to require specific performance of or prevent, restrain and/or
enjoin a breach under the provisions of this paragraph 6.
(d) In the event of any dispute under or arising out of this paragraph 6,
the prevailing party in such dispute shall be entitled to recover from the non-
prevailing party or parties, in addition to any damages and/or other relief that
may be awarded, its reasonable costs and expenses (including reasonable
attorneys' fees) incurred in connection with prosecuting or defending the
subject dispute.
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7. Non-Assignability.
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In light of the unique personal services to be performed by the Employee
hereunder, it is acknowledged and agreed that any purported or attempted
assignment or transfer by the Employee of this Agreement or any of his duties,
responsibilities or obligations hereunder shall be void.
8. Notices.
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Any notices, requests, demands or other communications required or
permitted under this Agreement shall be in writing and shall be deemed to have
been given (a) when delivered personally, (b) one (1) day after being deposited
for overnight delivery with a recognized overnight delivery service, with all
charges prepaid or billed to the account of the sender and properly addressed as
hereinafter provided, or (c) three (3) days after being mailed by postpaid
certified mail, return receipt requested, addressed to the party being notified
at the address of such party first set forth above, or at such other address as
such party may hereafter have designated by notice; provided, however, that any
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notice of change of address shall not be effective until its receipt by the
party to be charged therewith. Copies of any notices or other communications to
the Company shall simultaneously be sent by first class mail to Xxxxxxxxx
Xxxxxxx, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx Xxxxxxxx,
Esq.
9. General.
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(a) Neither this Agreement nor any of the terms or conditions hereof may
be waived, amended or modified except by means of a written instrument duly
executed by the party to be charged therewith. Any waiver or amendment shall
only be applicable in the specific instance, and shall not constitute or be
construed as a waiver or amendment in any other or subsequent instance. No
failure or delay on the part of either party in respect of any enforcement of
obligations hereunder shall in any manner affect such party's right to seek or
effect enforcement at any other time or in respect of any other required
performance.
(b) Neither this Agreement nor any rights or obligations hereunder may be
assigned (other than by the Company by operation of law) by either party without
the express prior written consent of the other party.
(c) The captions and paragraph headings used in this Agreement are for
convenience of reference only, and shall not affect the construction or
interpretation of this Agreement or any of the provisions hereof.
(d) This Agreement, and all matters or disputes relating to the validity,
construction, performance or enforcement hereof, shall be governed, construed
and controlled by and under the laws of the State of New Jersey.
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(e) This Agreement shall be binding upon and shall inure to the benefit
of the parties hereto and their respective heirs, executors, administrators,
personal representatives, successors and permitted assigns.
(f) This Agreement may be executed in counterparts, each of which shall
be deemed to be an original hereof, but all of which together shall constitute
one and the same instrument.
(g) Except for any legal or judicial proceeding which may be brought for
injunctive and/or any other equitable relief as contemplated by paragraph 6(c)
above, any dispute involving the interpretation or application of this Agreement
shall be resolved by final and binding arbitration before one or more
arbitrators designated by the American Arbitration Association in New Jersey.
The award of such arbitrator(s) may be enforced in any court of competent
jurisdiction. The prevailing party in any action or proceeding hereunder shall
be entitled to an award for its costs and reasonable attorneys' fees in
connection with such action or proceeding, and the arbitrator(s) in any
arbitration hereunder shall be empowered and directed to make such an award in
his, her or their discretion.
(h) This Agreement constitutes the sole and entire agreement and
understanding between the parties hereto as to the subject matter hereof, and
supersedes all prior discussions, agreements and understandings of every kind
and nature between them as to such subject matter.
(i) This Agreement is intended for the sole and exclusive benefit of the
parties hereto and their respective heirs, executors, administrators, personal
representatives, successors and permitted assigns, and no other person or entity
shall have any right to rely on this Agreement or to claim or derive any benefit
herefrom absent the express written consent of the party to be charged with such
reliance or benefit.
(j) If any provision of this Agreement is held invalid or unenforceable,
either in its entirety or by virtue of its scope or application to given
circumstances, such provision shall thereupon be deemed modified only to the
extent necessary to render same valid, or not applicable to given circumstances,
or excised from this Agreement, as the situation may require; and this Agreement
shall be construed and enforced as if such provision had been included herein as
so modified in scope or application, or had not been included herein, as the
case may be.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and as of
the date first set forth above.
MILLENNIUM SPORTS MANAGEMENT, INC.
By: /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx, President
/s/ Xxxxxx X. Xxxxxxx, Xx.
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Xxxxxx X. Xxxxxxx, Xx.
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