EXHIBIT 10.6
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT ("Agreement") is made as of May 20, 2005, between
CENUCO, INC., a Delaware corporation (the "Company") and XXXXXX XXXXXXXXX (the
"Executive").
1. EMPLOYMENT.
The Company shall employ Executive, and Executive shall be employed by the
Company, upon the terms and subject to the conditions set forth in this
Agreement. The parties hereby acknowledge that the executive shall perform his
duties in Boca Raton, FL and not be required under the terms of this agreement
to relocate.
2. TERM OF EMPLOYMENT.
The term of Executive's employment under this Agreement shall begin on the date
of this Agreement and continue for a period of three (3) years until May 19,
2008 (the "Term"), unless Executive's employment is sooner terminated in
accordance with Section 5 below.
3. DUTIES AND RESPONSIBILITIES.
(a) Executive shall as Vice President of Corporate Development and
Investor Relations, and report to Xxxxxx Xxxxxxxx, Chairman
and Chief Executive Officer. In such capacity, Executive shall
perform such duties as may be assigned to Executive from time
to time by the Board of Directors of the Company or the Chief
Executive Officer of the Company.
(b) Executive shall faithfully serve the Company and its
affiliates, devote Executive's full working time, attention
and energies to the business of the Company and its affiliates
and perform the duties under this Agreement to the best of
Executive's abilities. Executive may make and manage his
personal investments provided the management of such
investments do not impede Executive's ability to perform his
duties hereunder and such investments in other activities do
not violate, in any material respect, the provisions of
Section 8 of this Agreement.
(c) Executive shall (i) comply with all applicable laws, rules and
regulations, and all requirements of all applicable
regulatory, self-regulatory, and administrative bodies; (ii)
comply with the Company's rules, procedures, policies,
requirements, and directions; and (iii) not engage in any
other business or employment without the written consent of
the Company.
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4. COMPENSATION AND BENEFITS.
(a) BASE SALARY.
During the Employment Term, the Company shall pay Executive a base
salary at the annual rate of two hundred fifty thousand ($250,000)
dollars per year, or such higher rate as may be determined from time to
time by the Company ("Base Salary"). Such Base Salary shall be paid in
accordance with the Company's standard payroll practice for executives.
(b) EXPENSE REIMBURSEMENT.
The Company shall promptly reimburse Executive for the ordinary and
necessary business expenses incurred by Executive in the performance of
the duties hereunder in accordance with the Company's customary
practices applicable to executives, including an automobile expense not
to exceed $900.00 per month, provided that such expenses are incurred
and accounted for in accordance with the Company's policy.
(c) BENEFIT PLANS.
Executive shall be eligible to participate in or receive benefits under
any profit sharing plan, medical and dental benefits plan, life
insurance plan, short-term and long-term disability plans, supplemental
and/or incentive compensation plans, or any other fringe benefit plan,
generally made available by the Company to executives working pursuant
to this form of Agreement (hereinafter referred to as "similarly
situated executives").
(d) STOCK OPTION PLAN.
Executive shall also be eligible to receive options to purchase shares
of the Company's common stock based upon performance objectives to be
determined at the sole discretion of the Board of Directors (or
Compensation committee) of the Company from time to time.
5. TERMINATION OF EMPLOYMENT.
Executive's employment hereunder may be terminated under the following
circumstances:
(a) DEATH.
Executive's employment hereunder shall terminate upon Executive's
death.
(b) TOTAL DISABILITY.
The Company may terminate Executive's employment hereunder upon
Executive becoming "Totally Disabled". For purposes of this Agreement,
Executive shall be
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"Totally Disabled" if Executive is physically or mentally incapacitated
so as to render Executive incapable of performing Executive's duties
under this Agreement. Executive's receipt of disability benefits under
the Company's long-term disability plan or receipt of Social Security
disability benefits shall be deemed conclusive evidence of Total
Disability for purpose of this Agreement; provided, however, that in
the absence of Executive's receipt of such long-term disability
benefits or Social Security benefits, the Company's Board of Directors
may, in its reasonable discretion (but based upon appropriate medical
evidence), determine that Executive is Totally Disabled.
(c) TERMINATION BY THE COMPANY FOR CAUSE.
The Company may terminate Executive's employment hereunder for "Cause"
at any time upon written notice to Executive. For purposes of this
Agreement, the term "Cause" shall mean any of the following:
(i) conviction of a crime (including conviction on a nolo
contendere plea) involving a felony;
(ii) material failure to perform employment duties after
thirty (30) days' written notice by certified mail of such
failure to perform;
(iii) fraud or embezzlement;
(iv) any act of gross misconduct (whether in connection with
Executive's responsibilities as an employee of the Company or
otherwise) that either materially impairs the Company's
business, goodwill or reputation or materially compromises
Executive's ability to represent the Company with the public;
or
(v) breach of any of the covenants set forth in Section 8
hereof.
(d) VOLUNTARY TERMINATION BY EXECUTIVE.
Executive may terminate employment hereunder at any time by providing
ninety (90) days' written notice to the Company.
(e) TERMINATION BY THE COMPANY WITHOUT CAUSE.
The Company may terminate Executive's employment hereunder without
Cause at any time upon written notice to Executive.
6. COMPENSATION FOLLOWING TERMINATION OF EMPLOYMENT.
In the event that Executive's employment hereunder is terminated, Executive
shall be entitled to the following compensation and benefits upon such
termination:
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(a) TERMINATION BY REASON OF DEATH.
In the event that Executive's employment is terminated by reason of
Executive's death, the Company shall pay the following amounts to
Executive's beneficiary or estate:
(i) Any accrued but unpaid Base Salary for services rendered
to the date of death, any accrued but unpaid expenses required
to be reimbursed under this Agreement; a pro-rata annual
incentive compensation payment to the extent payments are
awarded to similarly situated executives and paid at the same
time as similarly situated executives are paid; immediate
vesting of benefits (including Company contributions) in
profit sharing and savings plan; and any vacation accrued to
the date of death.
(ii) Any benefits to which Executive may be entitled pursuant
to the plans, policies and arrangements referred to in Section
4(c) hereof as determined and paid in accordance with the
terms of such plans, policies and arrangements.
(iii) As of the date of termination by reason of Executive's
death, stock options awarded to Executive shall be fully
vested. Executive's estate or beneficiary shall have up to
ninety (90) days from the date of death to exercise all such
options.
(b) TERMINATION BY REASON OF TOTAL DISABILITY.
In the event that Executive's employment is terminated by reason of
Executive's Total Disability as determined in accordance with Section
5(b), the Company shall pay the following amounts to Executive:
(i) Any accrued but unpaid Base Salary for services rendered
to the date of termination, any accrued but unpaid expenses
required to be reimbursed under this Agreement, any vacation
accrued to the date of termination. Executive shall also be
eligible for a bonus or incentive compensation payment to the
extent such awards are made to similarly situated executives,
pro-rated for the year in which Executive is terminated and
paid at the same time as similarly situated executives are
paid.
(ii) Any benefits to which Executive may be entitled pursuant
to the plans, policies and arrangements referred to in Section
4(c) hereof shall be determined and paid in accordance with
the terms of such plans, policies and arrangements.
(iii) As of the date of termination by reason of Executive's
total disability, Executive shall be fully vested in all stock
option awards. Executive shall have up to ninety (90) days
from the date of termination by reason of total disability to
exercise all such options.
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(c) TERMINATION FOR CAUSE.
In the event that Executive's employment is terminated by the Company
for Cause pursuant to Section 5(c), the Company shall pay the following
amounts to Executive:
(i) Any accrued but unpaid Base Salary for services rendered
to the date of termination, any accrued but unpaid expenses
required to be reimbursed under this Agreement, any vacation
accrued to the date of termination.
(ii) As of the date of termination by reason of cause,
Executive shall forfeit unexercised options and other
outstanding awards. Vested options must be exercisable within
30 days after termination.
(d) VOLUNTARY TERMINATION BY EXECUTIVE.
In the event that Executive terminates employment pursuant to Section
5(d), and other than for a resignation tendered pursuant to Section 7
of this Agreement, the Company shall pay the following amounts to
Executive:
(i) Any accrued but unpaid Base Salary for services rendered
to the date of termination, any accrued but unpaid expenses
required to be reimbursed under this Agreement, any vacation
accrued to the date of termination.
(ii) Any benefits to which Executive may be entitled pursuant
to the plans, policies and arrangements referred to in Section
4(c) hereof shall be determined and paid in accordance with
the terms of such plans, policies and arrangements.
(e) TERMINATION BY THE COMPANY WITHOUT CAUSE.
In the event that Executive's employment is terminated by the Company
pursuant to Section 5(e) for reasons other than death, Total Disability
or Cause, the Company shall pay the following amounts to Executive:
(i) Any accrued but unpaid Base Salary for services rendered
to the date of termination, any accrued but unpaid expenses
required to be reimbursed under this Agreement, any vacation
accrued to the date of termination.
(ii) Any benefits to which Executive may be entitled pursuant
to the plans, policies and arrangements referred to in Section
4(c) hereof shall be determined and paid in accordance with
the terms of such plans, policies and arrangements.
(iii) An amount equal to the Base Salary that would have been
payable to Executive during the remaining Term and payable in
equal monthly installments over the remaining Term.
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(iv) The Company at its expense will continue for Executive
and Executive's spouse and dependents, all health benefit
plans, programs or arrangements, whether group or individual,
in which Executive was entitled to participate at any time
during the twelve-month period prior to the date of
termination, until (A) the date that the Term of employment
would have ended but for the termination; (B) Executive's
death (provided that benefits payable to Executive's
beneficiaries shall not terminate upon Executive's death); or
(C) with respect to any particular plan, program or
arrangement, the date Executive becomes covered by a
comparable benefit by a subsequent employer. In the event that
Executive's continued participation in any such plan, program,
or arrangement of the Company is prohibited, the Company will
arrange to provide Executive with benefits substantially
similar to those which Executive would have been entitled to
receive under such plan, program, or arrangement, for such
period.
(v) Except to the extent prohibited by law, Executive will be
100% vested in all benefits, awards, and grants accrued but
unpaid as of the date of termination under any pension plan,
profit sharing plan, supplemental and/or incentive
compensation plans, and stock option plans in which Executive
was a participant as of the date of termination. Executive
shall have up to ninety (90) days from the date of termination
to exercise stock options.
(f) NO OTHER BENEFITS OR COMPENSATION.
Except as may be provided under this Agreement, under the terms of any
incentive compensation, employee benefit, or fringe benefit plan
applicable to Executive at the time of Executive's termination or
resignation of employment, Executive shall have no right to receive any
other compensation, or to participate in any other plan, arrangement or
benefit, with respect to future periods after such termination or
resignation.
(g) SUSPENSION OR TERMINATION OF BENEFITS AND COMPENSATION.
In the event that the Company, in its sole discretion determines that,
without the Company's express written consent, Executive has
(i) directly or indirectly engaged in, assisted or have any
active interest or involvement whether as an employee, agent,
consultant, advisor, officer, director, proprietor, or any
type of principal whatsoever, in any person, firm, or business
entity which is directly or indirectly competitive with the
Company or any of its affiliates, or
(ii) directly or indirectly, for or on behalf of any person,
firm, or business entity which is directly or indirectly
competitive with the Company or any of its affiliates (A)
solicited or accepted from any person or entity who is or was
a client of the Company during the term of Executive's
employment hereunder or during any of the twelve calendar
months preceding or following the termination of Executive's
employment any business for services similar to those rendered
by the
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Company, (B) requested or advised any present or future
customer of the Company to withdraw, curtail or cancel its
business dealings with the Company, or (C) requested or
advised any employee of the Company to terminate his or her
employment with the Company; the Company shall have the right
to suspend or terminate any or all remaining benefits payable
pursuant to Section 6 of this Agreement. Such suspension or
termination of benefits shall be in addition to and shall not
limit any and all other rights and remedies that the Company
may have against Executive.
7. RESIGNATION BY EXECUTIVE FOR GOOD REASON AND COMPENSATION PAYABLE
FOLLOWING CHANGE IN CONTROL.
(a) RESIGNATION FOR GOOD REASON FOLLOWING CHANGE IN CONTROL.
In the event a "Change in Control" occurs, Executive will be paid the
compensation described in Section 6(e) if Executive resigns or is
terminated (both a "resignation" and "termination" being referred to as
"termination" for the purposes of this Section 7) from employment with
the Company at any time prior to the six (6) month anniversary of the
date of the Change in Control following the occurrence of any of the
following events:
(i) without Executive's express written consent, the
assignment to Executive of any duties inconsistent with
Executive's positions, duties, responsibilities and status
with the Company immediately before a Change in Control, or a
change in Executive's reporting, responsibilities, titles or
offices as in effect immediately before a Change in Control,
or any removal of Executive from, or any failure to re-elect
Executive to, any of such positions, except in connection with
the termination of Executive's employment as a result of
death, or by the Company for Total Disability or Cause, or by
Executive other than for the reasons described in this Section
7(a);
(ii) a reduction by the Company in Executive's Base Salary as
in effect immediately before a Change in Control;
(iii) the failure of the Company substantially to maintain and
to continue Executive's participation in the Company's benefit
plans as in effect immediately before a Change in Control and
with all improvements therein subsequent thereto (other than
those plans or improvements that have expired thereafter in
accordance with their original terms), or the taking of any
action which would materially reduce Executive's benefits
under any of such plans or deprive Executive of any material
fringe benefit enjoyed by Executive immediately before a
Change in Control, unless such reduction or termination is
required by law;
(iv) the failure of the Company to provide Executive with an
appropriate adjustment to compensation such as a lump sum
relocation bonus, salary adjustment and/or housing allowance
so that Executive can purchase comparable
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primary housing if required to relocate (it being the
intention of this Section 7[a][iv] to keep the Executive
"whole" if required to relocate). In this regard, comparable
housing shall be determined by comparing factors such as
location (taking into account, by way of example, items such
as the value of the surrounding neighborhood, reputation of
the public school district, if applicable, security and
proximity to Executive's place of work), quality of
construction, design, age, size of the housing and the ratio
of the monthly payments including principle, interest, taxes
and insurance to the Executive's take home pay, to housing
most recently owned by Executive prior to, or as of the
effective date of the change of control;
(v) the failure by the Company to pay Executive any portion of
Executive's current compensation, or any portion of
Executive's compensation deferred under any plan, agreement or
arrangement of or with the Company, within seven (7) days of
the date such compensation is due; or
(vi) the failure by the Company to obtain an assumption of,
and agreement to perform the obligations of the Company under
this Agreement by any successor to the Company.
(b) CHANGE IN CONTROL.
For purposes of this Agreement, "Change in Control" means the
occurrence of any of the following events:
(i) Any transfer to, assignment to, or any acquisition by any
person, corporation or other entity, or group thereof, of the
beneficial ownership, within the meaning of Section 13(d) of
the Securities Exchange Act of 1934, of any securities of the
Company, which transfer, assignment or acquisition results in
such person, corporation, entity, or group thereof, becoming
the beneficial owner, directly or indirectly, of securities of
the Company representing 25 percent (25%) or more of the
combined voting power of the Company's then outstanding
securities; or
(ii) As a result of a tender offer, merger, consolidation,
sale of assets, or contested election, or any combination of
such transactions, the persons who were directors immediately
before the transaction shall cease to constitute a majority of
the Board of Directors of the Company or any successor to the
Company.
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8. RESTRICTIVE COVENANTS
(a) COMPETITIVE ACTIVITY.
Executive covenants and agrees that at all times during Executive's
period of employment with the Company, and during the period that
payments are made to Executive pursuant to Section 6 of this Agreement,
Executive will not engage in, assist, or have any active interest or
involvement (whether as an employee, agent, consultant, creditor,
advisor, officer, director, stockholder (excluding holding of public
company), partner, proprietor or any type of principal whatsoever in
any person, firm, or business entity which, directly or indirectly, is
engaged in any business that is competitive with the business of the
Company (or any affiliate of the Company). Executive further agrees
that for a period of one (1) year after the date payments made to
Executive pursuant to Section 6 of this Agreement cease, or for a
period of two (2) years following the date of termination, whichever is
later, Executive will not, directly or indirectly, within 75 miles of
any operating location of the Company (or any affiliate of the
Company), engage in, assist, or have any active interest or
involvement, whether as an employee, agent, consultant, creditor,
advisor, officer, director, stockholder (excluding holding of less that
1% of the stock of a public company), partner, proprietor or any type
of principal whatsoever in any person, firm, or business entity which,
directly or indirectly, is engaged in any business that is competitive
with the business of the Company (or any affiliate of the Company).
(b) NON-SOLICITATION.
Executive covenants and agrees that at all times during Executive's
period of employment with the Company, and for a period of one (1) year
after the date payments made to Executive pursuant to Section 6 of this
Agreement cease, or two (2) years after the date of termination of the
Executive's employment for any reason, whichever date is later,
Executive will not directly or indirectly (i) induce any customers of
the Company (or its affiliates) to patronize any similar business which
competes with the business of the Company; (ii) canvass, solicit or
accept any similar business from any customer of the Company (or its
affiliates); (iii) directly or indirectly request or advise any
customers of the Company (or its affiliates) to withdraw, curtail,
materially amend or cancel such customer's business with the Company;
or (iv) directly or indirectly disclose to any other person, firm or
corporation the names or addresses of any of the customers of the
Company (or its affiliates).
(c) NON-DISPARAGEMENT.
Executive covenants and agrees that Executive shall not engage in any
pattern of conduct that involves the making or publishing of written or
oral statements or remarks (including, without limitation, the
repetition or distribution of derogatory rumors, allegations, negative
reports or comments) which are disparaging, deleterious or damaging to
the integrity, reputation or good will of the Company, its management,
or of management of affiliates of the Company.
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(d) PROTECTED INFORMATION.
Executive recognizes and acknowledges that Executive has had and will
continue to have access to various confidential or proprietary
information concerning the Company and its affiliates of a special and
unique value which may include, without limitation, (i) books and
records relating to operation, finance, accounting, sales, personnel
and management, (ii) policies and matters relating particularly to
operations such as customer service requirements, costs of providing
service and equipment, operating costs and pricing matters, and (iii)
various trade or business secrets, including customer lists, route
sheets, business opportunities, marketing or business diversification
plans, business development and bidding techniques, methods and
processes, financial data and the like (collectively, the "Protected
Information"). Executive therefore covenants and agrees that Executive
will not at any time, either while employed by the Company or
afterwards, make any independent use of, or disclose to any other
person or organization any of the Protected Information.
9. ENFORCEMENT OF COVENANTS.
(a) TERMINATION OF EMPLOYMENT AND FORFEITURE OF COMPENSATION.
Executive agrees that any breach by Executive of any of the covenants
set forth in Section 8 hereof during Executive's employment by the
Company, shall be grounds for immediate termination of employment for
cause and forfeiture of any accrued and unpaid salary, bonus,
commissions or other compensation of such Executive as liquidated
damages, which shall be in addition to and not exclusive of any and all
other rights and remedies the Company may have against Executive.
(b) RIGHT TO INJUNCTION.
Executive acknowledges that a breach of the covenants set forth in
Section 8 hereof will cause irreparable damage to the Company with
respect to which the Company's remedy at law for damages will be
inadequate. Therefore, in the event of breach of anticipatory breach of
the covenants set forth in this section by Executive, Executive and the
Company agree that the Company shall be entitled to the following
particular forms of relief, in addition to remedies otherwise available
to it at law or equity; (i) injunctions, both preliminary and
permanent, enjoining or retraining such breach or anticipatory breach
and Executive hereby consents to the issuance thereof forthwith and
without bond by any court of competent jurisdiction; and (ii) recovery
of all reasonable sums expended and costs, including reasonable
attorney's fees, incurred by the Company to enforce the covenants set
forth in this section.
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(c) SEPARABILITY OF COVENANTS.
The covenants contained in Section 8 hereof constitute a series of
separate covenants, one for each applicable State in the United States
and the District of Columbia, and one for each applicable foreign
country. If in any judicial proceeding, a court shall hold that any of
the covenants set forth in Section 8 exceed the time, geographic, or
occupational limitations permitted by applicable laws, Executive and
the Company agree that such provisions shall and are hereby reformed to
the maximum time, geographic, or occupational limitations permitted by
such laws. Further, in the event a shall be deemed eliminated from the
provisions of this Agreement for the purpose of such proceeding to the
extent necessary to permit the remaining separate covenants to be
enforced in such proceeding. Executive and the Company further agree
that the covenants in Section 8 shall each be construed as a separate
agreement independent of any other provisions of this Agreement, and
the existence of any claim or cause of action by Executive against the
Company whether predicated on this Agreement or otherwise, shall not
constitute a defense to the enforcement by the Company of any of the
covenants of Section 8.
10. WITHHOLDING OF TAXES.
The Company may withhold from any compensation and benefits payable under this
Agreement all applicable federal, state, local, or other taxes.
11. NON-DISCLOSURE OF AGREEMENT TERMS.
Executive agrees that Executive will not disclose the terms of this Agreement to
any third party other than Executive's immediate family, attorney, accountants,
or other consultants or advisors who need to know or except as may be required
by any governmental authority.
12. SOURCE OF PAYMENTS.
All payments provided under this Agreement, other than payments made pursuant to
a plan which provides otherwise, shall be paid from the general funds of the
Company, and no special or separate fund shall be established, and no other
segregation of assets made, to assure payment. Executive shall have no right,
title or interest whatever in or to any investments which the Company may make
to aid the Company in meeting its obligations hereunder. To the extent that any
person acquires a right to receive payments from the Company hereunder, such
right shall be no greater than the right of an unsecured creditor of the
Company.
13. ASSIGNMENT.
Except as otherwise provided in this Agreement, this Agreement shall inure to
the benefit of and be binding upon the parties hereto and their respective
heirs, representatives, successors and assigns. This Agreement shall not be
assignable by Executive, and shall be assignable by the Company only to any
corporation or other entity resulting from the
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reorganization, merger or consolidation of the Company with any other
corporation or entity or any corporation or entity to or with which the
Company's business or substantially all of its business or assets may be sold,
exchanged or transferred.
14. ENTIRE AGREEMENT; AMENDMENT.
This Agreement shall supersede any and all existing oral or written agreements,
representations, or warranties between Executive and the Company or any of its
affiliates relating to the terms of Executive's employment by the Company. It
may not be amended except by a written agreement signed by both parties.
15. GOVERNING LAW.
This Agreement shall be governed by and construed in accordance with the laws of
the State of Delaware applicable to agreements made and to be performed in that
State, without regard to its conflict of laws provisions.
16. NOTICES.
Any notice, consent, request or other communication made or given in connection
with this Agreement shall be in writing and shall be deemed to have been duly
given when delivered or mailed by registered or certified mail, return receipt
requested, or by facsimile or by hand delivery, to those listed below at their
following respective addresses or at such other address as each may specify by
notice to the others:
To the Company:
Xxxxxx Xxxxxxxx
Lander Co., Inc.
0000 Xxxxx Xxxxx
Xxxxx 000
Xxxxxxxxxxxxx, XX 00000
To Executive:
Xxxxxx Xxxxxxxxx
c/o Cenuco, Inc.
0000 Xxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
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17. MISCELLANEOUS.
(a) WAIVER.
The failure of a party to insist upon strict adherence to any term of
this Agreement on any occasion shall not be considered a waiver thereof
or deprive that party of the right thereafter to insist upon strict
adherence to that term or any other term of this Agreement.
(b) SEPARABILITY.
Subject to Section 9 hereof, if any term or provision of this Agreement
is declared illegal or unenforceable by any court of competent
jurisdiction and cannot be modified to be enforceable, such term or
provision shall immediately become null and void, leaving the remainder
of this Agreement in full force and effect.
(c) HEADINGS.
Section headings are used herein for convenience of reference only and
shall not affect the meaning of any provision of this Agreement.
(d) RULES OF CONSTRUCTION.
Whenever the context so requires, the use of the singular shall be
deemed to include the plural and vice versa.
(e) COUNTERPARTS.
This Agreement may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, and such
counterparts will together constitute but one Agreement.
[Remainder of Page Intentionally Blankl]
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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the day and year first above written.
CENUCO, INC.
By: /s/ Xxxxxx Xxxxxxxx Date: May 20, 2005
--------------------------------
Name: Xxxxxx Xxxxxxxx
Title: Chairman & Chief Executive Officer
EXECUTIVE
/s/ Xxxxxx Xxxxxxxxx Date: May 20, 2005
--------------------------------
Name: Xxxxxx Xxxxxxxxx
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