(Xxxxx X. Xxxxx)
EMPLOYMENT CONTRACT, dated as of January 1, 1997
between Hungarian Teleconstruct Corp., 000 Xxxxx 000, Xxxxxxxx,
Xxx Xxxxxx 00000 (the "Company") and Xxxxx X. Xxxxx (the
"Employee").
Whereas the Company and Employee entered into an
employment contract dated as of February 1, 1994 which was
modified on April 12, 1994 , October 23, 1995, and on December 23,
1996 (which contract together with the modifications are
hereinafter referred to as the "Agreement"); and
Whereas the Agreement provided for the grant of 35,000
non-qualified options to purchase 35,000 shares of the Company's
Common Stock ("Stock") at an exercise price of $1 per share, which
options have vested and the shares underlying said options have
been registered with the Securities and Exchange Commission; and
Whereas the Board of Directors on December 23, 1996
agreed that this Agreement shall be modified so as to extend the
term of the Agreement from June 1, 2000 to December 31, 2001 and
to provide for an increase in duties to include Chief Financial
Officer and for an increase in salary to $10,000 per month; and
Whereas the Company and the Employee desire to restate
the Agreement so as to incorporate the aforesaid modifications
into the Agreement:
Now, therefore, the parties agrees as follows:
1. Agreement dated as of January 1, 1997 between the
Company and the Employee is restated by the agreement set forth
herein.
2. Term:
The Company agrees to employ the Employee in an
executive capacity as Chief Financial Officer, Secretary,
Treasurer and Director and Employee agrees to serve on the terms
and conditions of this Agreement for a period of five years
commencing January 1, 1997. The period during which Employee is
employed hereunder is hereinafter referred to as the "Employment
Period."
3. Duties & Services:
During the Employment Period, Employee shall be
employed in the business of the Company. In performance of his
duties, Employee shall be subject to the reasonable direction of
the Board of Directors of the Company. Employee agrees to perform
his duties hereunder to the best of his abilities and to take no
action outside of the ordinary course of business that he is not
specifically authorized to take by the Board of Directors of the
Company, and that the foregoing shall constitute a material term
of this Agreement. Employee shall be based in New York but shall
be available to travel as the needs of the business reasonably
require.
4. Compensation:
As full compensation for his services hereunder,
the Company shall pay Employee, during the Employment Period, as
follows:
A. A basic salary of $120,000 per year payable in
monthly installments at the rate of $10,000 per month
for the term of this agreement.
B. The Company has granted to the Employee as of
February 1, 1994, 35,000 non-qualified options to
purchase 35,000 shares of Common Stock of the Company
at the same exercise price of $1 per share. All
options vested as of October 23, 1995 and the shares
underlying the options were registered with the
Securities and Exchange Commission under a
Registration Statement on Form S-8 on December 9,
1996.
The options have a 10-year exercise term. Employee's
right to receive shares will be adjusted when the option is
exercised both as to number and exercise price to account for
stock splits or other forms of recapitalization.
C. The Company acknowledges that it has not paid any
salary to Employee for the months of July through
December 1996 and that any unpaid salary shall be a
debt of the Company to be paid to Employee at the time
of termination of the Agreement.
5. Expenses and Benefits:
(a) The Company, consistent with its policy of
reporting and reimbursement of business expenses,
reimburse Employee for such ordinary and necessary
business related expenses as shall be incurred by
Employee in the course of the performance of his
duties under this Agreement
(b) Employee shall be eligible to participate to
the extent that he qualifies in all benefit plans,
including without limitation, pension, term life
insurance, hospitalization, medical insurance and
disability plans as are made available from time-to-time
to executives of the Company.
(c) Employee shall be entitled to three weeks of
paid vacation annually, and to accumulate unused
vacation weeks to the end of this agreement.
6. Representations & Warranties of Employee
Employee represents and warrants to the Company
that Employee is under no contractual or other restriction which
is inconsistent with the execution of this Agreement or
performance of his duties hereunder.
7. Termination:
In the event of death or physical or mental
incapacity, or in the event Employee resigns from Company due to
change in management or in the event of the termination of
Employee's employment by the Company for any reason other than
"Cause" as hereinafter defined, Employee or his estate or
representative shall be entitled to full payment of his salary for
the balance of the Agreement payable in a lump sum at the option
of the Employee or of his estate or representative or monthly in
accordance with the terms of the Agreement and to payment of any
unpaid salary owed to Employee under this Agreement:
A. Cause, for purposes of this Agreement, shall
mean that the Employee shall have committed
an intentional art of fraud, embezzlement or
theft in connection with Employee's duties or
in the course of his employment with the
Company or any Subsidiary
8. Survival:
The covenants, agreements, representations and
warranties contained in or made pursuant to this Agreement shall
survive Employee's rightful termination of employment.
9. Modifications:
This Agreement sets forth the entire
understanding of the parties with respect to the subject matter
hereof, supersedes all existing agreements between the parties
concerning such subject matter, and may be modified only by a
written instrument duly executed by such party.
10. Notices
Any notice or other communication permitted to be
given hereunder shall be in writing and shall be mailed by
certified mail, return receipt requested or delivered against
receipt to the party to whom it is to be given at the address of
such party set forth in the preamble to this Agreement (or to such
other address as the party shall have furnished in writing and in
accordance with the provisions of this Section 10). Notice to the
estate of Employee shall be sufficient if addressed to Employee as
provided in this Section 10. Any notice or other communication
given by certified mail shall be deemed given at the time of
certification thereof, except for a notice changing a party's
address which shall be deemed given at the time of receipt
thereof.
11. Waiver:
Any waiver by either party of a breach of any
provision of this Agreement shall not operate as or be construed
to be waiver of any other breach of such provision or of any
breach of any other provision of this Agreement. The failure of a
party to insist upon strict adherence to any term of this
Agreement on one or more occasions shall not be considered a
waiver or deprive that party of the right thereafter to insist
upon strict adherence to that term or any other term of this
agreement. Any waiver must be in writing.
12. Binding Effect:
Employee's rights and obligations under this
agreement shall not be transferable by assignment or otherwise,
such rights shall not be subject to commutation, encumbrance or
the claims of Employee's creditors and any attempt to do any of
the foregoing shall be void. The provisions of this Agreement
shall be binding upon and inure to the benefit of Employee and his
heirs and personal representative and shall be binding upon and
inure to the benefit of the Company and its successors and
assigns.
13. No Third Party Beneficiaries:
This Agreement does not create and shall not be
construed as creating any rights enforceable by any person not a
party to this Agreement.
14. Headings:
The headings in this Agreement are solely for the
convenience of reference and shall be given no effect in the
construction or interpretation of this Agreement.
15. Counterparts, Governing Law:
This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
It shall be governed and construed in accordance with the laws of
the Republic of Hungary without giving effect to conflict of laws.
IN WITNESS WHEREOF, the parties have duly
executed this Agreement as of the date first above-written.
HUNGARIAN TELECONSTRUCT CORP.
BY /s/ Xxxxxx Xxxxxx
Xxxxxx Xxxxxx
/s/ Xxxxx X. Xxxxx
Xxxxx X. Xxxxx
