Exhibit 10.3
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is entered into as of October
27, 2006, by and between Amish Naturals, Inc., a Nevada corporation, (the
"Company") and Xxxxx X. Xxxxxxx, Xx. ("Executive"). The parties hereto agree as
follows:
1. Employment and Duties. The Company shall employ Executive in the
position of President and Chief Executive Officer of the Company (or such other
senior executive position as may be assigned to him by the Company's Board of
Directors). Executive shall report directly to the Board of Directors (or such
other persons designated by the Company's Board of Directors) and shall perform
all duties and obligations of President and Chief Executive Officer (or such
other senior executive duties assigned to Executive from time to time by the
Company's Board of Directors). Executive shall devote his full business time,
attention and energies exclusively to the business and interests of the Company
and to the performance of his duties and obligations under this Agreement.
2. Term of Agreement. Subject to the provisions of Section 4, Executive
and the Company retain the right to terminate this Agreement at any time, for
any reason or no reason, and with or without Cause (as defined in Section
4.1.1), and with or without notice. Nothing in this Agreement shall be deemed to
alter the at-will nature of Executive's employment with the Company, and the
at-will nature of Executive's employment shall not otherwise be modified except
in a writing signed by both Executive and the Chairman of the Board of
Directors, and if Executive shall be the Chairman of the Board, then by any
other director, in each case only after such modification shall have been
approved by the Company's Board of Directors in its sole discretion.
Notwithstanding the foregoing, the provisions of Sections 5 and 10 of the
Agreement shall survive, and continue in full force and effect, after any
termination or expiration of this Agreement, irrespective of the reason for the
termination or any claim that the termination was wrongful or illegal.
3. Compensation and Other Benefits. The Company shall provide the
following compensation and other benefits to Executive in consideration of
Executive's performance of all of his obligations under this Agreement:
3.1 Base Salary. Subject to the provisions of Section 4, the Company
shall pay to Executive an annual base salary (the "Base Salary") of $180,000.00,
less applicable withholdings. The Base Salary shall be payable in accordance
with the Company's ordinary payroll practices in effect during the period of
Executive's employment with the Company.
3.2 Incentive Compensation. For each fiscal year of Executive's
employment with the Company, Executive shall be eligible to earn a bonus
("Incentive Compensation"), the amount of which, if any, shall be determined by
the Board of Directors in its sole discretion. Incentive Compensation, if any,
shall be paid to Executive within forty-five (45) days after the Company's
audited financial statements have been issued for the fiscal year in which such
Incentive Compensation was earned. Incentive Compensation will not be considered
earned for a particular fiscal year unless Executive is employed with the
Company on October 1 immediately following the close of that fiscal year.
Executive acknowledges and agrees that if his employment with the Company is
terminated pursuant to Sections 4.1.1, 4.1.2, 4.2 or 4.3 below before the
Incentive Compensation is considered earned, Executive shall not be eligible for
payment of Incentive Compensation for the fiscal year in which the termination
is effective.
3.3 Stock Option Plan. Executive shall be eligible to participate in
any stock option plan that may be adopted by the Company for its managerial
employees and approved by the Company's Board of Directors in its sole and
absolute discretion ("Proposed Stock Option Plan"). The Company shall recommend
to the Board of Directors that Executive be granted, subject to compliance with
all state and federal securities laws and in accordance with the terms and
conditions of the Proposed Stock Option Plan, an option to purchase 1,000,000
shares of the common stock authorized for issuance under the Proposed Stock
Option Plan pursuant to a vesting schedule. The proposed form of grant and
vesting schedule is attached hereto as Exhibit A.
3.4 Fringe Benefits. As additional compensation under this
Agreement, Executive shall be entitled to receive the following benefits (the
"Fringe Benefits"):
3.4.1 Employee Benefit Plans. The Company shall allow
Executive to participate in such group medical, health, pension, welfare, and
insurance plans (the "Employee Benefit Plans") maintained by the Company from
time to time for the general benefit of its executive employees, as such
Employee Benefit Plans may be modified from time to time in the Company's sole
and absolute discretion.
3.4.2 Other Benefits. The Company shall provide Executive with
all other benefits and perquisites as are made generally available to the
Company's executive employees under the Company's Employee Handbook, as such
Employee Handbook may be modified from time to time in the Company's sole and
absolute discretion.
3.4.3 Car Allowance. Executive shall receive a car allowance
of $750.00 per month. Executive shall pay all costs associated with the purchase
of insurance, operation, and maintenance of such vehicle. Such insurance shall
provide adequate protection of the Company and shall be in form and substance
acceptable to the Company.
3.4.4 Vacation. Executive shall be entitled to such vacation
time as is generally made available to the Company's executive employees under
the Company's employment policies, as such employment policies may be modified
from time to time in the Company's sole and absolute discretion; provided,
however, that in no event shall Executive accrue vacation time at a rate which
is less than three (3) weeks per year; provided further, that Executive may not
accrue more than two times Executive's annual vacation allotment. Executive will
cease accruing vacation if Executive reaches the maximum accrual amount, and
will commence accruing vacation again only after Executive has used enough
vacation to fall below the maximum.
3.4.5 Reimbursement of Business Expenses. The Company shall
reimburse Executive for all reasonable travel, entertainment and other expenses
incurred by Executive in connection with the performance of his duties under
this Agreement, upon submission by Executive to Company of reasonable
documentation pertaining to such expenses.
3.5 Deferred Compensation. Any deferred compensation (within the
meaning of Section 409A of the Internal Revenue Code) payable under this
Agreement on Account of Executive's separation from service shall not commence
prior to six months following such separation if Executive is a key employee
(within the meaning of Section 409A); provided, however, that, in determining
whether Executive is a key employee, any compensation realized on account of the
exercise of a stock option or a disqualifying disposition of stock acquired
through the exercise of an incentive stock option shall be disregarded.
4. Termination or Expiration of Agreement.
4.1 Termination at Company's Election. The Company may terminate
Executive's employment at any time, for any reason or no reason, with or without
Cause (as defined in Section 4.1.1), and with or without notice, subject to the
provisions of Sections 4.1.1 and 4.1.2.
4.1.1 Termination for Cause. If Executive's employment is
terminated for Cause (as hereinafter defined), Executive shall be entitled to
receive only the following: (i) payment of Executive's Base Salary through and
including the date of termination; (ii) payment of any earned by unpaid
Incentive Compensation for the prior fiscal year pursuant to the terms of
Section 3.2; (iii) payment for all accrued and unused vacation time as of the
date of termination; and (iv) reimbursement of business expenses incurred prior
to the date of termination. Except as expressly set forth in this Section 4.1.1,
Executive shall not be entitled to receive any Base Salary, Incentive
Compensation or Fringe Benefits in the event Executive's employment is
terminated for Cause, except that Executive may continue to participate in the
Employee Benefit Plans to the extent permitted by and in accordance with the
terms thereof or as otherwise required by law. As used in this Agreement, Cause
shall be defined as: (a) a material breach by Executive of any term of this
Agreement; (b) an intentional refusal or failure to follow the lawful and
reasonable instructions of the Board of Directors or an individual to whom the
Board of Directors instructed the Executive to report (as appropriate); (c) a
willful or habitual neglect of duties; (d) misconduct on the part of Executive
that is materially injurious to the Company, including, without limitation,
misappropriation of trade secrets, fraud or embezzlement; or (e) Executive's
conviction for fraud, theft or a felony involving moral turpitude. In the case
of clauses (a) through (c), Executive fails to cure such breach within thirty
(30) days of Executive's receipt of written notice from the Company; provided,
however, that such cure period shall not be applicable if, in the case of clause
(a), the Board of Directors, in its sole discretion, has determined that such
breach is not capable of being fully cured; provided, further, that, upon the
second occurrence of a breach of under clauses (a) through (c), no such cure
period need be extended to Executive.
4.1.2 Termination Without Cause. If Executive is terminated by
the Company without Cause, Executive shall receive: (i) payment of Executive's
Base Salary through and including the date of termination; (ii) payment of any
earned but unpaid Incentive Compensation for the prior fiscal year pursuant to
the terms of Section 3.2; (iii) payment for all accrued and unused vacation time
existing as of the date of termination; and (iv) reimbursement of business
expenses incurred prior to the date of termination. In addition, Executive shall
be eligible to receive a severance payment based on Executive's length of
service, less applicable withholdings, provided Executive signs a general
release of all claims in a form approved by the Board of Directors. The amount
of any severance payment shall be based upon the following schedule:
Length of Service Equivalent Months of Base Salary
----------------- --------------------------------
Up to 12 months 6 months
More than 12 months up to 2 years 8 months
More than 2 years up to 3 years 10 months
More than 3 years 1 year
4.2 Termination upon Death or Permanent Disability. This Agreement
will terminate automatically on Executive's death or if Executive becomes
Permanently Disabled (as defined below). In the event of such termination,
Executive, or his beneficiary or estate, shall be entitled to receive such
amounts of the Base Salary, Incentive Compensation and Fringe Benefits as would
have been payable to Executive under a termination without Cause under Section
4.1.2 as of the date of death or the date as of which the Company has determined
in its sole discretion that Executive has become Permanently Disabled. As used
in this Agreement, "Permanently Disabled" shall mean the incapacity of Executive
due to illness, accident, or any other reason to perform his duties for a period
of 90 calendar days, whether or not consecutive, during any 12-month period, all
as determined by the Company in its sole discretion. All Company determinations
as to the date and extent of incapacity of Executive shall be made by the
Company's Board of Directors, upon the basis of such evidence, including
independent medical reports and data, as the Board of Directors in its sole
discretion deems necessary and desirable. All such determinations of the Board
of Directors shall be final.
4.3 Termination at Executive's Election. Executive may resign from
employment with the Company for any reason by providing written notice to the
Company prior to the date selected for resignation. If Executive resigns from
employment, Executive shall be entitled to receive only the following: (i)
payment of Executive's Base Salary through and including the date of
resignation; (ii) payment of any earned but unpaid Incentive Compensation for
the prior fiscal year pursuant to the terms of Section 3.2; (iii) payment for
all accrued and unused vacation time existing as of the date of resignation,
which will be made at a rate calculated in accordance with Executive's Base
Salary at the time of resignation; and (iv) reimbursement of business expenses
incurred prior to the date of resignation. Except as expressly set forth in this
Section 4.3, in the event Executive resigns from employment, Executive shall not
be entitled to receive any Base Salary, Incentive Compensation, Fringe Benefits
or other times, except that Executive may continue to participate in the
Employee Benefit Plans to the extent permitted by and in accordance with the
terms thereof or as otherwise required by law.
4.4 Exercise of Stock Options Upon Termination. Any options granted
to Executive pursuant to the Proposed Stock Option Plan as set forth in Section
3.3 shall cease vesting on the date of termination of Executive's employment,
and, to the extent vested on the date of termination and not previously
exercised or expired, may be exercised by Executive in accordance with the terms
and conditions of the Proposed Stock Option Plan.
5. Non-Competition and Confidential Information.
5.1 Assistance to Competitors. During Executive's employment with
the Company, Executive and Executive's spouse and immediate family members shall
not own a material interest in (other than up to 2% of the voting securities of
a publicly traded corporation), render financial assistance to, or offer
personal services to (whether for payment or otherwise), any entity or
individual that competes with the Company in the Company Business. "Company
Business" shall mean the Company's business as it is currently conducted and any
other business activity in which the Company is engaged at any time during the
period of Executive's employment with the Company.
5.2 Confidential Information, Inventions, Non-Solicitation.
Executive acknowledges and agrees to comply with all of the terms of the
Employee Confidentiality and Non-Disclosure Agreement ("Confidentiality
Agreement") executed by Executive, attached hereto as Exhibit B, during
Executive's employment with the Company and thereafter as provided in the
Confidentiality Agreement.
5.3 Company Property. Upon termination of Executive's employment
with the Company at any time for any reason, or upon the Company's request at
any time and for any reason, Executive shall promptly return all such Company
property to the Company, without keeping any copy of any such Company property
for himself or any other entity or individual.
6. Representation and Warranties. Executive represents and warrants to the
Company that Executive is under no contractual or other restriction or
obligation that is materially inconsistent with the execution of this Agreement,
the performance of his duties hereunder, or the rights of the Company hereunder,
including, without limitation, any development agreement, non-competition
agreement or non-disclosure or confidentiality agreement previously entered into
by Executive.
7. Severability. In the event that any provision of this Agreement should
be held to be void, voidable, unlawful or for any reason unenforceable, the
remaining provisions or portions of this Agreement shall remain in full force
and effect.
8. Amendment and Waiver. No provision of this Agreement can be modified,
amended, supplemented or waived in any manner except by an instrument in writing
signed by both Executive and the Chairman of the Board of Directors, and if
Executive shall be the Chairman of the Board, then by any other director, in
each case only after such modification shall have been approved by the Company's
Board of Directors in its sole discretion. The waiver by either party of
compliance with any provision of this Agreement by the other party shall not
operate or be construed as a waiver of any other provision of this Agreement, or
of any subsequent breach by such party of any provision of this Agreement.
9. Applicable Law. This Agreement, Executive's employment relationship
with the Company, and any and all matters or claims arising out of or related to
this Agreement or Executive's employment relationship with the Company, shall be
governed by, and construed in accordance with, the laws of the State of Ohio,
regardless of the choice of law provisions of Ohio or any other jurisdiction.
10. Arbitration.
10.1 Exclusive Remedy. Except as set forth in Section 10.3,
arbitration shall be the sole and exclusive remedy for any dispute, claim, or
controversy of any kind or nature (a "Claim") arising out of, related to, or
connected with this Agreement, Executive's employment relationship with the
Company, or the termination of Executive's employment relationship with the
Company, including any Claim against any parent, subsidiary, or affiliated
entity of the Company, or any director, officer, employee, or agent of the
Company or of any such parent, subsidiary, or affiliated entity. It also
includes any claim against the Executive by the Company, or any parent,
subsidiary or affiliated entity of the Company.
10.2 Claims Subject to Arbitration. Excepting only claims excluded
in Section 10.3 below, this Agreement specifically includes (without limitation)
all claims under or relating to any federal, state or local law or regulation
prohibiting discrimination, harassment or retaliation based on race, color,
religion, national origin, sex, age, disability or any other condition or
characteristic protected by law; demotion, discipline, termination or other
adverse action in violation of any contract, law or public policy; entitlement
to wages or other economic compensation; any Claim for personal, emotional,
physical, economic or other injury; and any Claim for business torts or
misappropriation of confidential information or trade secrets.
10.3 Claims Not Subject to Arbitration. This Section 10 does not
preclude either party from making an application to a court of competent
jurisdiction for provisional remedies (e.g., temporary restraining order or
preliminary injunction). This Agreement also does not apply to any claims by
Executive: (i) for workers' compensation benefits; (ii) for unemployment
insurance benefits; (iii) under a benefit plan where the plan specifies a
separate arbitration procedure; (iv) filed with an administrative agency which
are not legally subject to arbitration under this Agreement; or (v) which are
otherwise expressly prohibited by law from being subject to arbitration under
this Agreement.
10.4 Procedure. The arbitration shall be conducted in the Borough of
Manhattan, New York. Any Claim submitted to arbitration shall be decided by a
single, neutral arbitrator (the "Arbitrator"). The parties to the arbitration
shall mutually select the Arbitrator not later than 45 days after service of the
demand for arbitration. If the parties for any reason do not mutually select the
Arbitrator within the 45 day period, then any party may apply to any court of
competent jurisdiction to appoint a retired judge as the Arbitrator. The
arbitration shall be conducted in accordance with Ohio Revised Code Annotated
sections 2711.01 through 2711.16, as amended, except as modified by this
Agreement. The Arbitrator shall apply the substantive federal, state, or local
law and statute of limitations governing any Claim submitted to arbitration. In
ruling on any Claim submitted to arbitration, the Arbitrator shall have the
authority to award only such remedies or forms of relief as are provided for
under the substantive law governing such Claim. The Arbitrator shall issue a
written decision revealing the essential findings and conclusions on which the
decision is based. Judgment on the Arbitrator's decision may be entered in any
court of competent jurisdiction.
10.5 Costs. Executive shall only pay that portion of the fees and
costs incurred in the arbitration (e.g., filing fees and transcript costs) that
he would normally pay in the course of litigation. All other fees and costs,
including the Arbitrator's fees, shall be borne by the Company. The parties
shall be responsible for their own attorneys' fees and costs, except that the
Arbitrator shall have the authority to award attorneys' fees and costs to the
prevailing party in accordance with the applicable law governing the dispute.
10.6 Interpretation of Arbitrability. The Arbitrator, and not any
federal or state court, shall have the exclusive authority to resolve any issue
relating to the interpretation, formation or enforceability of this Section 10,
or any issue relating to whether a Claim is subject to arbitration under this
Section 10, except that any party may bring an action in any court of competent
jurisdiction to compel arbitration in accordance with the terms of this Section
10.
11. Entire Agreement. This Agreement constitutes the entire agreement
between the parties relating to the subject matter of this Agreement and
supersedes all prior and contemporaneous negotiations, understandings, or
agreements between the parties, whether oral or written, expressed or implied.
12. Counterparts. This Agreement may be executed by the parties in
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same instrument.
13. Headings. The headings of sections and Sections of this Agreement are
included solely for convenience of reference and shall not control the meaning
or interpretation of any of the provisions of this Agreement.
14. Notices. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing, and if sent by certified or
registered mail or personally delivered to Executive at 0000 Xxxxx Xxxxx 00,
Xxxxxxxxxxx, Xxxx 00000 or to the Company at 0000 Xxxxx Xxxxx 00, Xxxxxxxxxxx,
Xxxx 00000 Attn: Xxxxx X. Xxxxxxx, Xx.
AMISH NATURALS, INC.
By: /s/ Xxxxxx Silver /s/ Xxxxx Xxxxxxx, Sr.
-------------------------- ------------------------
Xxxxxx Silver Xxxxx X. Xxxxxxx, Xx.
Its: Chairman of the Board
