EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated as of March 15, 2000, by and between
XXXXXXXXXXXX.XXX, INC., a Nevada corporation (the "Company"), with offices
located at 00 Xxxxx Xxxx Xxxx, Xxxxxxxxx, XX 00000, and XXXXXXX XxXXXX, residing
at 00 Xxxx Xxxxxx Xxxx, Xxxxxxxxx, XX 00000 (the "Executive").
W I T N E S S E T H :
WHEREAS, the Company wishes to assure itself of the services of the
Executive for the period provided in this Agreement, and the Executive is
willing to serve in the employ of the Company on a full-time basis for said
period, and upon the other terms and conditions hereinafter provided.
NOW, THEREFORE, the Company and the Executive, intending to be legally
bound, agree as follows:
1. Employment. The Company hereby employs the Executive and the
Executive hereby accepts employment with the Company, all in accordance with the
terms and conditions hereof, for a term commencing on the date hereof and ending
(subject to the provisions of Section 5 hereof) three (3) years thereafter (the
"Term"). The Term shall then extend automatically in one (1) year increments,
subject to termination by notice given by either party to the other not less
than three (3) months prior to the commencement of any one year extension.
2. Duties.
2.1 During the Term, the Executive shall be employed by the
Company and shall serve as the group President of silverzipper Brands, which is
the operation responsible for sales of the Company's products to retail stores
and outlets, and shall perform such executive duties and have such powers
relating to the Company, as the Board of Directors may specify from time to
time, which shall be consistent with his position of an executive officer,
including acting as an officer of one or more subsidiaries of the Company.
2.2 During the Term, the Executive shall devote his full
business time, attention and energy to the business and affairs of the Company
and shall not engage, directly or indirectly, in any other business, employment
or occupation, except for non-substantial amounts of time related to other
investments.
3. Compensation.
3.1 As compensation for his services and undertakings pursuant
to the terms of this Agreement, the Executive shall receive base compensation at
the rate of One Hundred Fifty Thousand ($150,000) Dollars per year (the "Base
Compensation"). The Base Compensation shall be payable at such regular times and
intervals as the Company customarily pays its employees from time to time.
3.2 The Executive be granted one or more performance
bonuses as determined by the Board of Directors of the
Company.
3.3 The Executive shall have the right to participate, on the
same basis as executive employees of the Company, in the Company's employee
benefit programs, if any, including, without limitation, group life, health,
accident and hospitalization insurance programs covering the Executive and his
dependents and disability insurance similar in coverage to that currently
provided, and to a vacation comparable to other executive employees to be taken
at mutually acceptable times.
3.4 The Company shall deduct from the Executive's compensation
any Federal, state or city withholding taxes, social security contributions and
any other amounts which may be required to be deducted or withheld by the
Company pursuant to any federal, state or city laws, rules or regulations.
3.5 The Company shall reimburse the Executive, or cause him to
be reimbursed, for all reasonable out-of-pocket expenses incurred by him in the
performance of his duties hereunder or in furtherance of the business and/or
interests of the Company; provided, however, that the Executive shall have
previously furnished to the Company an itemized account, satisfactory to the
Company, in substantiation of such expenditures.
3.6 The Executive shall receive $500.00 per month as a cash
allowance for a car or other related expense.
3.7 The Executive shall be granted an option to purchase
120,000 shares of Common Stock of the Company at $2.00 per share vesting as to
40,000 shares each at the end of the first, second and third years of the Term,
with full vesting upon a merger of the Company in which it is not the surviving
entity or the sale by the Company of substantially all of its assets.
4. Indemnification. The Company undertakes, to the extent permitted by
law, to indemnify and hold the Executive harmless from and against all claims,
damages, losses and expenses, including reasonable attorneys' fees and
disbursements, arising out of the performance by the Executive of his duties
pursuant to this Agreement, in furtherance of the Company's business and within
the scope of his employment.
5. Termination.
5.1 If the Executive dies or becomes disabled during the Term,
his Base Compensation and all other rights under this Agreement except for
rights under Section 3.4 shall terminate at the end of the month during which
death or disability occurs. For purposes of this Agreement, the Executive shall
be deemed to be "disabled" if he has been unable to perform his duties for sixty
(60) consecutive days or ninety (90) days in any twelve (12) month period, all
as determined in good faith by the Board of Directors of the Company.
5.2 The Company shall, in the manner described in the last
paragraph of Section 5.3, have the right to terminate the employment of
Executive under this Agreement and Executive shall forfeit the right to receive
any and all further payments hereunder, other than the right to receive any
compensation then due and payable to Executive pursuant to Section 3 hereof
through to the date of termination, if Executive shall have committed any
material breach of any of the provisions or covenants of this Agreement.
5.3 If the Company elects to terminate this Agreement as set
forth above, it shall deliver notice of such intention to the Executive,
describing with reasonable detail, the action or omission of the Executive
constituting the act of default (the "Termination Notice"), and prior to any
termination by the Company of the Executive's employment, the Executive shall
first have an opportunity to cure or remedy such act of default within
forty-five (45) days following the Termination Notice, and if the same is cured
or remedied within such period, such notice shall become null and void.
6. Restrictive Covenants.
6.1 Confidential Information; Covenant not to Disclose. The
Executive covenants and undertakes that he will not at any time during or after
the termination of his employment hereunder reveal, divulge, or make known to
any person, firm, corporation, or other business organization (other than the
Company or its affiliates, if any), or use for his own account any customer
lists, trade secrets, or any secret or any confidential information of any kind
used by the Company during his employment by the Company, and made known
(whether or not with the knowledge and permission of the Company, whether or not
developed, devised, or otherwise created in whole or in part by the efforts of
the Executive, and whether or not a matter of public knowledge unless as a
result of authorized disclosure) to the Executive by reason of his employment by
the Company. The Executive further covenants and agrees that he shall retain
such knowledge and information which he has acquired or shall acquire and
develop during his employment respecting such customer lists, trade secrets, and
secret or confidential information in trust for the sole benefit of the Company,
its successors and assigns.
6.2 Covenant Not to Compete; Non-Interference.
6.2.1 The Executive covenants and undertakes that, during the
Term and for a period of one (1) year thereafter, he will not, without the prior
written consent of the Company, directly or indirectly, and whether as
principal, agent, officer, director, employee, consultant, or otherwise, alone
or in association with any other person, firm, corporation, or other business
organization, carry on, or be engaged, concerned, or take part in, or render
services to, or own, share in the earnings of, or invest in the stock, bonds, or
other securities of any person, firm, corporation, or other business
organization (other than the Company or its affiliates, if any) engaged in a
business in the Continental United States which is in competition with any of
the businesses carried on by the Company (a "Similar Business") except in the
course of his employment hereunder; provided, however, that the Executive may
invest in stock, bonds, or other securities of any Similar Business (but without
otherwise participating in the activities of such Similar Business) if (i) such
stock, bonds, or other securities are listed on any national or regional
securities exchange or have been registered under Section 12(g) of the
Securities Exchange Act of 1934; and (ii) his investment does not exceed, in the
case of any class of the capital stock of any one issuer, 5% of the issued and
outstanding shares, or in the case of bonds or other securities, 5% of the
aggregate principal amount thereof issued and outstanding.
6.2.2 The Executive covenants and undertakes that during the
Term and for a period of one (1) year thereafter he will not, whether for his
own account or for the account of any other person, firm, corporation or other
business organization, interfere with the Company's relationship with, or
endeavor to entice away from the Company, any person, firm, corporation or other
business organization who or which at any time during the Term, was an employee,
consultant, agent, supplier, or a customer of, or in the habit of dealing with,
the Company.
6.2.3 If any provision of this Article 6.2 is held by any
court of competent jurisdiction to be unenforceable because of the scope,
duration or area of applicability, such provision shall be deemed modified to
the extent the court modifies the scope, duration or area of applicability of
such provision to make it enforceable.
7. Injunction. It is recognized and hereby acknowledged by the
Executive that a breach or violation by the Executive of any of the covenants or
agreements contained in this Agreement may cause irreparable harm and damage to
the Company hereto, the monetary amount of which may be virtually impossible to
ascertain. As a result, the Executive recognizes and acknowledges that the
Company shall be entitled to an injunction, without posting any bond or security
in connection therewith, from any court of competent jurisdiction enjoining and
restraining any breach or violation of any of the restrictive covenants
contained in Section 6 of this Agreement by the Executive or his associates,
partners or agents, either directly or indirectly, and that such right to
injunction shall be cumulative and in addition to whatever other rights or
remedies the Company may possess. Nothing contained in this Section 7 shall be
construed to prevent the Company from seeking and recovering from the Executive
damages sustained as a result of any breach or violation by the Executive of any
of the covenants or agreements contained in this Agreement, and that in the
event of any such breach, the Company shall avail itself of all remedies
available both at law and at equity.
8. Compliance with Other Agreements. The Executive represents and
warrants to the Company that the execution of this Agreement by him and his
performance of his obligations hereunder will not, with or without the giving of
notice, the passage of time or both, conflict with, result in the breach of any
provision of or the termination of, or constitute a default under, any agreement
to which the Executive is a party or by which the Executive is or may be bound.
9. Miscellaneous.
9.1 Notices. Any notice or other communication to a party
under this Agreement shall be in writing, and shall be considered given when
delivered personally, or by a recognized overnight delivery company to the party
at the following address or at such other address as the party may specify by
notice to the other in the manner provided for herein:
(a) If to the Company at its address set forth above, with
a copy to Ruskin, Moscou, Xxxxx & Faltischek, P.C., 000
Xxx Xxxxxxx Xxxx, Xxxxxxx, Xxx Xxxx 00000, Attention:
Xxxxxx X. Xxxxxx, Esq.; and
(b) If to the Executive: at his address set forth above.
Either party may change the address to which notice may be given by giving 10
days' notice of such change.
9.2 Benefit. This Agreement shall be binding upon and inure to
the benefit of the respective parties hereto and their legal representatives,
successors and assigns. Insofar as the Executive is concerned this Agreement,
being personal, cannot be assigned.
9.3 Validity. The invalidity or unenforceability of any
provisions hereof shall in no way affect the validity or enforceability of any
other provision.
9.4. Entire Agreement. The Agreement constitutes the entire
Agreement between the parties, and supersedes all existing agreements between
them. It may only be changed or terminated by an instrument in writing signed by
both parties. The covenants of the Executive contained in Section 6 of this
Agreement shall survive the termination of this Agreement and the expiration of
the Term.
9.5 New York Law to Govern. This Agreement shall be governed
by, construed and interpreted in accordance with the laws of the State of New
York without regard to its conflicts of law principles. Exclusive jurisdiction
of any action or proceeding arising hereunder shall reside in the Federal and
New York State courts located in the City, County and State of New York. The
party prevailing in the dispute shall be entitled to be reimbursed for its
reasonable counsel fees and expenses for the party not prevailing.
9.6 Waiver of Breach. The failure of a party to insist on
strict adherence to any term of this Agreement on any occasion shall not be
considered a waiver or deprive that party of the right thereafter to insist upon
strict adherence to that term or any term of this Agreement. Any waiver hereto
must be in writing.
9.7 Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
9.8 Paragraph Headings. Paragraph headings are inserted herein
for convenience only and are not intended to modify, limit or alter the meaning
of any provision of this Agreement.
IN WITNESS WHEREOF, the parties hereto have set their hands and
executed this Agreement as of the day and year first above written.
XXXXXXXXXXXX.XXX, INC.
By: /s/ Xxxx X. Xxxxxxx
--------------------
Xxxx X. Xxxxxxx
Chief Executive Officer
/s/ Xxxxxxx XxXxxx
----------------------------
XXXXXXX XxXXXX, Individually
