Exhibit 10.1
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made this 1st day of July, 2002, by and between
CAPITOL GROUP HOLDINGS CORPORATION., a Nevada corporation having its principal
office and place of business in Xxxxx County, Nevada (the "Company") and XXXXX
X. XXXXXXXX, a resident of Xxxxx County, Nevada (the "Employee").
1. Employment. The Company hereby employs the Employee and the
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Employee hereby accepts employment upon the terms and conditions hereinafter
set forth.
2. Duties. The Employee is engaged as President and Chief
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Executive Officer of the Company. The duties of the Employee shall include
without limitation:
(a) Devoting full time and attention to the performance of his duties as
President and Chief Executive Officer of the Company;
(b) Performing such other duties incident to acting as President and Chief
Executive Officer of the Company;
(c) Visit with all clients, vendors and manufacturers that supply products to
the Company, including visits to suppliers, and assist in the business
negotiations with such vendors and manufacturers;
(d) Visit with representatives and potential customers of the Company for the
purpose of promoting the business of the Company; and
(e) Devote such time and effort to his duties under this Agreement as may be
reasonably requested by the Company.
3. Term. Subject to the provisions for termination hereinafter
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provided, the Employee's employment hereunder shall begin on the date hereof,
and shall terminate on the fifth anniversary date of this Agreement.
4. Base Compensation. In partial consideration of the Employee's
services to be rendered hereunder, the Company shall pay to the Employee, as
base compensation, a salary of $144,000.00 per year, payable in equal
semimonthly installments of $6,000.00 on the 15th and last days of each month
during the term of the Employee's employment hereunder, pro rated for any
partial employment period.
5. Commission. In addition to the base compensation set forth
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in Paragraph 4 hereof, the Employee shall be entitled to receive an allowance
for automobile expense of $1,000 per month, payable on the 15th of each month
during the term of this Agreement.
6. Reimbursement of Expenses. The Company recognizes that the Employee,
in rendering services hereunder as President and Chief Executive Officer of the
Company, will be required to spend sums of money for the entertainment of
various persons and representatives of companies and organizations with whom the
Company is having, or would like to have, business relationships. In addition to
the compensation provided for in Paragraph 4 above, the Company shall reimburse
the Employee for business expenses it deems reasonably incurred by him in
performing his duties hereunder. The Employee shall adhere to all rules and
regulations, which may be issued from time to time by the Company with respect
to the reimbursement of expenses.
The Company will reimburse the Employee for all business expenses
incurred for and on behalf of the Company, provided the Employee presents to the
Company:
(a) An account book or statement in which the Employee recorded details about
such expense at or near the time such expenditure was made;
(b) The amount of the expenditure;
(c) The time, place and designation of the type of entertainment and travel or
other expenses;
(d) The business reason for the expense and the nature of the benefit derived or
expected to be derived as a result of the expenditure;
(e) The names, occupations, addresses, and other information concerning each
person who was entertained, or other information sufficient to establish a
business relationship to the Company; and
(f) Documentary evidence such as receipts or bills paid which state sufficient
information to establish the amount, date, place, and essential character of the
expenditure.
The Employee shall provide such other information with respect to the
business expense incurred hereunder which may be required by the Company to
enable it to comply with the rules and regulations promulgated by the Internal
Revenue Service of the United States of America for the purpose of establishing
the reasonableness of all such business expenses and deductions.
7. Fringe Benefits. So long as the Company employs the Employee, he
shall be entitled to participate in the Company's group medical and
hospitalization plan. The Employee shall be entitled to 4 weeks' vacation (or
more in the discretion of the Board of Directors), which period or periods of
vacation are to be first approved by the Board of Directors of the Company. In
addition, the Employee shall be entitled to receive with pay all holidays
observed by the Company, as may be determined by the Board of Directors from
time to time. The Company may, at its option, treat as sick days all days it
deems to be excessive days of vacation. In addition, the Employee shall be
entitled to 15 days of sick leave or more, in the discretion of the Board of
Directors. It is the parties' intention that the Company's vacation and sick
leave policies regarding the Employee are to be much more flexible than the
policies generally maintained by the Company for its other employees.
8. Death of the Employee. If the Employee dies while this Agreement is
in effect, the compensation otherwise to be paid to the deceased Employee shall
be paid to the deceased Employee's spouse or designated beneficiary, if any, for
a period of six months from when such death occurs. Thereafter, the Company
shall have no further liability to Employee's heirs, successors, or assigns for
compensation, other than to pay any accrued and unpaid benefits then due and
owing (such as for unused vacation pay).
9. Working Facilities and Benefits. The Employee shall be
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furnished with a private office, secretarial help, and such other facilities
and services, suitable to his position and adequate to the performance of his
duties.
10. Non-Performance of Duties. If the Employee is unable, or fails, to
perform his full-time duties to the Company ("Non-Performance") for a period of
more than six weeks, his compensation shall be reduced by 50 percent thereafter.
If he returns to full-time duties within six weeks after that, then his full
compensation shall resume at such time. If he does not return to full-time
duties within twelve weeks from the date of the commencement of Non-Performance,
then the Company shall have the right at its option to terminate the Employee's
employment. Nothing contained in this paragraph shall affect any rights, if any,
which the Employee may have under the federal Family Medical Leave Act or any
other such applicable law, and the parties intend that the provisions of this
Paragraph shall accord Employee equivalent rights to those presently provided by
such law.
11. Life Insurance. The Company may at its discretion, at any time
after the execution of this Agreement, apply for and procure as owner and for
its own benefit a policy or policies of insurance on the life of the Employee,
in such amounts and in such form or forms as the Company may choose. The
Employee shall have no interest whatsoever in any such policy or policies, but
he shall at the request of the Company submit to such medical examinations,
supply such information, and execute such documents as may be required by the
insurance company or companies to whom the Company has applied for such
insurance.
12. Termination of Employment for Cause. Nothing in this
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Agreement shall be construed to prevent the Company from terminating the
Employee's employment at any time:
(a) If the Employee refuses, or is not able, to discharge his full duties;
(b) If the Employee engages in conduct determined by the Company to be fraud,
misappropriation, embezzlement or similar conduct of moral turpitude; or
(c) If the Employee is charged with or indicted for the commission of any felony
or misdemeanor involving moral turpitude by any state or federal court in the
United States of America, or in any jurisdiction where he is employed; or
(d) If the Employee shall willfully violate any of the terms or provisions of
this Agreement.
The parties agree that such termination shall not be a breach of this
Agreement by the Company, and that such termination shall end the Company's
obligation to pay compensation or benefits to the Employee or his heirs,
successors or assigns.
13. Confidential Information and Trade Secrets.
As used herein, the term "Trade Secrets" shall mean any scientific or
technical information, design, process, procedure, formula or improvement of the
Company or any of its affiliates that is valuable and not generally known to
competitors of the Company and its affiliates. "Confidential Information" shall
mean any data or information, other than Trade Secrets, of the Company or any of
its affiliates that is important, competitively sensitive, and not generally
known by the public, including but not limited to the strategic and business
plans, business prospects, training manuals, product development plans, bidding
and pricing procedures, market strategies, internal performance statistics,
financial data, confidential personnel information concerning employees,
supplier data, operational or administrative plans, policy manuals, and terms
and conditions of contracts and agreements and such similar information relating
to subsidiaries and affiliates of the Company, provided, however, that "Trade
Secrets" and "Confidential Information" shall not apply to information which is
(i) already in the Employee's possession (unless such information was obtained
by the Employee from the Company or its affiliates or was obtained by the
Employee in the course of the Employee's employment by the Company or its
affiliates), (ii) received by the Employee from a third party with no
restriction on disclosure, (iii) becomes generally available to the public
through no wrongful act on the part of the Employee, or (iv) required to be
disclosed by any applicable law.
(a) The Employee recognizes that the Employee's position with
the Company is of a fiduciary nature and requires considerable responsibility
and trust. In reliance on the Employee's loyalty, the Company may entrust the
Employee with highly sensitive confidential, restricted and proprietary
information involving Trade Secrets and Confidential Information of the Company
and its affiliates.
(b) Except as required to perform the Employee's duties as an
employee, the Employee will not use or disclose any Trade Secrets or
Confidential Information during his employment or thereafter. This obligation
shall constitute a covenant, which shall survive this Agreement and be
separately enforceable.
(c) Upon the request of the Company and, in any event, upon
the termination of employment hereunder, the Employee will surrender to the
Company all memoranda, notes, records, drawings, manuals or other documents
(including all copies thereof) pertaining to the Company's business, the
Employee's employment or the business of the Company or its affiliates, as well
as all materials involving any Trade Secrets or Confidential Information.
(d) All such information and materials, whether or not made or
developed by the Employee, shall be the sole and exclusive property of the
Company or its affiliates, and the Employee hereby assigns to the Company all of
the Employee's right, title and interest in and to any and all of such
information and materials.
14. Covenant Not to Compete. It is recognized by the Employee that the
Business of the Company is international in scope and that geographical
limitations on the below described covenant not to compete and the
non-solicitation covenant are therefore not appropriate. Consequently, for a
period of five years from the date of this Agreement, on a worldwide basis, the
Employee shall not:
(a) Canvass, solicit, or accept any business for any other person, partnership,
firm, corporation or other legal entity engaged in business the same as the
Business of the Company from any present or past customer of the Company.
(b) Give any other person, partnership, firm, corporation or other legal entity
engaged in business the same as the Business of the Company the right to
canvass, solicit or accept any business from any present or past customer of the
Company.
(c) Directly or indirectly request or advise any past, present or future
customer of the Company to withdraw, curtail or cancel its business for any
other business the same as the Business of the Company, from any present or past
customer of the Company.
(d) Directly or indirectly disclose to any other person, partnership, firm,
corporation or other legal entity engaged in business the same as the Business
of the Company the names of past, present or future customers of the Company.
(e) Directly or indirectly induce, or attempt to influence any employee of the
Company to terminate his employment.
(f) Without the written consent of the Company, directly or indirectly employ or
attempt to employ any person, who, on the date of this Agreement or at any time
during the two years before the date of this Agreement, is or was an employee
the Company, whether full or part-time.
(g) Directly or indirectly own, manage, operate, join or participate in, or be
connected as an officer, director, stockholder, employee, partner or otherwise
with any business under any name similar to Capitol Group Holdings Corporation,
or the name of the Company or any of its affiliated corporations.
(h) Directly or indirectly compete with, or become interested in any competitor
of the Company in the Business of the Company.
This covenant on the part of the Employee shall be construed as an
agreement independent of any other provision of this Agreement and the existence
of any claim or cause of action by the Employee against the Company, whether
predicated on this Agreement or otherwise, shall not constitute a defense to the
enforcement by the Company of this covenant.
As used herein, the "Business of the Company" shall include "affordable
senior housing communities."
If a court of competent jurisdiction determines that any of the
provisions of this covenant not to compete are unreasonable or otherwise
unenforceable, such court shall be empowered to sever or modify any portion of
the territory or prohibited business activity identified herein which is not
found to be enforceable from the coverage of this covenant and to apply the
remaining provisions of this covenant to the applicable temporal, territorial or
categorical activities not so severed. The parties agree that no determination
regarding enforceability, if any, shall in any manner affect the right of the
Company to recover damages as a result of any breach of this covenant by the
Employee. The parties also agree that with respect to the duration and
applicability of the covenant not to compete, the time period specified herein
shall be extended for a period equal to the aggregate quantity of time during
which the Employee is found to have violated such prohibitions in any respect.
15. Specific Enforcement. The Employee specifically acknowledges and
agrees that the restrictions established by the covenants on Trade Secrets,
Confidential Information and non-competition are reasonable and necessary to
protect the legitimate interest of the Company and its affiliates and that the
Company would not have employed the Employee in the absence of his agreement to
abide by such restrictions. The Employee further acknowledges and agrees that
any violation of these covenants will result in irreparable injury to the
Company or its affiliates, that the remedy at law for any violation or
threatened violation of such paragraphs will be inadequate and that in the event
of any such breach, the Company or its affiliates, in addition to any other
remedies or damages available at law or in equity, shall be entitled to
temporary injunctive relief before trial from any court of competent
jurisdiction as a matter of course and to permanent injunctive relief without
the necessity of proving actual damages, after the posting of a bond in the
amount of $100.00, the issuance of which the Employee hereby consents.
16. Damages for Breach. In the event of a breach of this
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Agreement by either the Company or the Employee resulting in damages to the
other party, that party may recover from the party breaching this Agreement any
and all damages that may be sustained.
17. Attorney's Fees to Enforce Covenants. If it should become necessary
for any party to bring suit for enforcement of the covenants herein contained,
the parties hereby agree that the party who is found to have violated said
covenants shall also be liable for all reasonable attorney's fees and costs of
court incurred by the prevailing party.
18. Governing law; Jurisdiction; Venue. This Agreement shall be
governed by and construed in accordance with the laws of the State of Nevada,
without regard to any conflicts of laws provisions thereof, and shall be deemed
for all purposes to be performable in Xxxxx County, Nevada. Each party hereby
irrevocably submits to the personal jurisdiction of the United States District
Court for the Southern District of Nevada, Las Vegas Division, as well as of the
District Courts of the State of Nevada in Xxxxx County, Nevada over any suit,
action or proceeding arising out of or relating to this Agreement. Each party
hereby irrevocably waives, to the fullest extent permitted by law, any objection
which it may now or hereafter have to venue of any such mediation, arbitration,
suit, action or proceeding brought in any such county and any claim that any
such mediation, arbitration, suit, action or proceeding brought in such county
has been brought in an inconvenient forum.
19. Arbitration. Any controversy or claim arising out of or relating to
this Agreement, or the Employee's employment relationship with the Company, or
any matters engaged in by the Employee during or after the term of this
Agreement, shall be resolved by final and binding arbitration in accordance with
the Commercial Arbitration Rules of the American Arbitration Association ("AAA")
then in effect, pursuant to the provisions of the Federal Arbitration Act, 9
U.S.C. xx.xx. 1 et seq. The parties agree that this Agreement involves matters
in interstate commerce considering the nature and scope of the Company's
business, and the activities in which the Employee shall be engaging as part of
his full-time duties. Upon the initiation of an arbitration proceeding by either
party, the AAA shall be responsible for (a) appointing a sole neutral arbitrator
with experience in matters at issue, and (b) administering the case in
accordance with the AAA Rules. The filing fees shall initially be paid by the
party initiating the arbitration, and the arbitrator shall have the right to
award recovery of such fee to the prevailing party. The arbitration shall be
conducted at the AAA offices in Las Vegas, Nevada, or at such other location in
Las Vegas, Nevada as shall be mutually agreeable. The arbitrator shall render a
reasoned award within thirty (30) days after the closing of the hearing
conducted according to applicable AAA rules. Upon the application of either
party to this Agreement, and whether or not an arbitration proceeding has yet
been initiated, all courts having jurisdiction hereby are authorized to: (x)
issue and enforce in any lawful manner, such temporary restraining orders,
preliminary injunctions and other interim measures of relief as may be necessary
to prevent harm to a party's interest or as otherwise may be appropriate pending
the conclusion of arbitration proceedings pursuant to this Agreement; and (y)
enter and enforce in any lawful manner such judgments for permanent equitable
relief as may be necessary to prevent harm to a party's interest or as otherwise
may be appropriate following the issuance of arbitral awards pursuant to this
Agreement. Any order or judgment rendered by the arbitrator may be entered and
enforced by any court having competent jurisdiction. No action by any party to
seek such judicial relief shall constitute any waiver of his or its right to
arbitration herein. The prevailing party in the arbitration shall be entitled to
recover, in addition to any damages or other relief, if any, reasonable
attorney's fees, as well as all costs incurred. If an award is entered against a
party, then that party shall have thirty (30) days after the date of the award
within which to comply with the award in full. Interest on the award shall
accrue at ten (10%) percent per annum from the date of the award until paid in
full. If the party against whom an award has been entered fails to comply timely
with the award in full, then the prevailing party shall have the right to
enforce the award in any court of competent jurisdiction, and shall also have
the right to recover all additional attorney's fees and expenses incurred after
entry of the award for having had to seek judicial enforcement of the award.
20. Benefit. All the terms and provisions of this Agreement
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shall be binding upon and inure to the benefit of and be enforceable by the
parties hereto, and their respective heirs, executors, administrators, personal
representatives, successors and permitted assigns.
21. Notices. All notices, requests and other communications hereunder
shall be in writing and shall be deemed to have been duly given at the time of
receipt if delivered by hand or communicated by electronic transmission, or, if
mailed, three days after deposit in the United States mail, registered or
certified, return receipt requested, with postage prepaid and addressed to the
party to receive same, if to the Company, addressed to Capitol Group Holdings
Corp. at 0000 X. Xxxxxx Xxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxx 00000, telephone
(000) 000-0000, fax (000) 000-0000, and e-mail xxxx@xxxxxxxxxx.xxx; and if to
the Employee, addressed to Xx. Xxxxx Xxxxxxxx at 0000 X. Xxxxxx Xxx. Xxx Xxxxx,
Xxxxxx 00000, telephone (000) 000-0000, fax (000) 000-0000, and e-mail
xxxxx@xxx.xxx; provided, however, that if either party shall have designated a
different address by notice to the other given as provided above, then any
subsequent notice shall be addressed to such party at the last address so
designated.
22. Construction. Words of any gender used in this Agreement shall be
held and construed to include any other gender, and words in the singular number
shall be held to include the plural, and vice versa, unless the context requires
otherwise. In addition, the pronouns used in this Agreement shall be understood
and construed to apply whether the party referred to is an individual,
partnership, joint venture, corporation or an individual or individuals doing
business under a firm or trade name, and the masculine, feminine and neuter
pronouns shall each include the other and may be used interchangeably with the
same meaning.
23. Waiver. No course of dealing on the part of any party hereto or its
agents, or any failure or delay by any such party with respect to exercising any
right, power or privilege of such party under this Agreement or any instrument
referred to herein shall operate as a waiver thereof, and any single or partial
exercise of any such right, power or privilege shall not preclude any later
exercise thereof or any exercise of any other right, power or privilege
hereunder or thereunder.
24. Cumulative Rights. The rights and remedies of any party
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under this Agreement and the instruments executed or to be executed in
connection herewith, or any of them, shall be cumulative and the exercise or
partial exercise of any such right or remedy shall not preclude the exercise of
any other right or remedy.
25. Invalidity. In the event any one or more of the provisions
contained in this Agreement or in any instrument referred to herein or executed
in connection herewith shall, for any reason, be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality, or unenforceability
shall not affect the other provisions of this Agreement or any such other
instrument.
26. Headings. The headings used in this Agreement are for
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convenience and reference only and in no way define, limit, simplify or
describe the scope or intent of this Agreement, and in no way effect or
constitute a part of this Agreement.
27. No Third-Party Beneficiary. Any agreement to pay an amount and any
assumption of liability herein contained, express or implied, shall be only for
the benefit of the undersigned parties and their respective successors and
permitted assigns (as herein expressly permitted), and such agreements and
assumptions shall not inure to the benefit of the obligees or any other party,
whomsoever, it being the intention of the parties hereto that no one shall be or
be deemed to be a third-party beneficiary of this Agreement.
28. Multiple Counterparts. This Agreement may be executed in one
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or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
29. Entire Agreement. This instrument contains the entire
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Agreement of the parties with respect to the subject matter hereof, and may not
be changed orally, but only by an instrument in writing signed by the party
against whom enforcement of any waiver, change, modification, extension,
or discharge is sought.
30. Time of the Essence. Time is of the essence of this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the
date first written above.
Capitol Group Holdings Corp.
By /s/ Xxxxx Xxxxxx
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Xxxxx Xxxxxx, Secretary
By /s/
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Xxxxx Xxxxxxxx, Chief Executive Officer
