EMPLOYMENT AGREEMENT
This agreement is made as of March 1, 1997, and has been entered into
between ABC Dispensing Technologies, Inc., a Florida corporation with its
principal offices at 000 Xxxxxxx Xxxx (the "Employer" or "Company"), and Xxxxxxx
X. Xxxxxx, Xx. (the "Employee").
WHEREAS, the Company desires to employ the Employee on the terms and
conditions set forth herein; and
WHEREAS, the Employee desires to be employed by the Company on the terms
and conditions set forth herein;
NOW THEREFORE, the Company and the Employee agree as follows:
1. EMPLOYMENT. The Company hereby employs the Employee, and the Employee
hereby accepts continued employment, upon the terms and conditions hereinafter
set forth.
2. TERM. Subject to the provisions of termination as herein provided, the
Term of this Agreement shall begin on March 1, 1997, and shall terminate on
February 28, 2000 (being three (3) years after the commencement date); provided,
however, that commencing on the date which is one year prior to the date of
termination, and on each anniversary of such date (such date and the date of
each anniversary thereof being a "Renewal Date"), the term shall be
automatically extended so to terminate two (2) years from such Renewal Date,
unless at least sixty (60) days prior to such Renewal Date either party hereto
gives notice to the other that the term shall not be so extended.
3. POSITION AND DUTIES. During the term of this Agreement, the Employee
shall serve as President and Chief Executive Officer of the Company with at
least such statutory duties and responsibilities as exist as of the date hereof
and as may be provided in the By-Laws of the Company. The place of employment
shall be at the principal executive offices of the Company in Akron, Ohio. The
Employee agrees to devote all of business time, skill, attention and best
efforts during normal business hours to the business of the Company to the
extent necessary to discharge the responsibilities assigned during the term of
employment hereunder, except for service on other corporation, civic or
charitable boards or committees not significantly interfering with the
Employee's duties hereunder and usual, ordinary and customary periods of
vacation.
4. COMPENSATION.
(a) Base Salary. For all services rendered by Employee under this
Agreement, the Company shall pay a salary of $150,000 per year ("Base Salary"),
which Base Salary will be increased annually to reflect the percentage increase
in the consumer Price Index for Ohio (the "CPI") for the most recently completed
year. Upon issuance of the CPI for the Ohio region, Employee's Basse Salary will
be increase retroactively to January of the year following the year for which
the CPI is issued. The Base Salary will be paid in installments in conformity
with the regular payroll practices of the Company. The Base Salary shall also be
reviewed annually by the Compensation Committee of the Board of Directors of the
Company and may be increased on the basis of individual and corporate
performance, by criteria and standards determined by the Compensation Committee.
Any increase in Base Salary or other compensation shall in no way limit or
reduce any other obligation of the Company, hereunder, and once established at
an increased specified rate, Employee's Base Salary hereunder shall not
thereafter be reduced.
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(b) Incentive Compensation; Bonuses. In addition to the Base Salary, the
Employee shall be entitled to an annual bonus equal to four (4%) percent of
annual pretax income as calculated by the company's auditors, and shall be
entitled (i) participate in such incentive plans (including the right to defer
such bonus) made available by the Company to its executives and key employees
and (ii) to receive such additional bonus or discretionary compensation payments
as the Board of Directors of the Company or the Compensation Committee may
determine from time to time, which incentive plan participation and additional
bonus or discretionary compensation payments shall be reviewed annually by the
Compensation Committee of the Board of Directors and shall be awarded, on the
basis of corporate performance, by criteria and standards established by the
Board of Directors or the Compensation Committee of the Board in their sole
discretion.
(c) Expenses. During the term of employment hereunder, the Employee
shall be entitled to receive prompt reimbursement for all reasonable expenses
incurred in accordance with the policies and procedures of the Company, as may
be in force from time to time.
(d) Benefits. During the term of employment hereunder, the Employee
shall be entitle to receive a package of benefits that includes all of the
programs, plans and perquisites currently provided to you by the Company, as
long as such programs, plans and perquisites are continued by the company.
(e) Special Award. A special award of Stock Options or Warrants to
acquire 100,00 shares of common stock of the Company at an exercise price of
$1.25 per share shall be granted to the Employee as of the effective date of the
Agreement. The term of the Stock Option or Warrant shall be 10 years, and the
shares shall be fully vested as of January 31, 1998.
5. TERMINATION.
(a) Termination for Disability. In the event that Employee shall have
been prevented form substantially rendering the services required under this
Agreement by reason of his disability (as confirmed by medical authority
satisfactory to the Company and Social Security guidelines) for a period of six
(6) consecutive months (or 180 days), the Company shall have the Right to
terminate this Agreement upon thirty (30) days written notice, provided such
disability continues during said notice period.
(b) Termination for Employee's Breach. The Company shall have the
right to terminate this Agreement and the employment hereunder if Employee
violates his responsibilities under paragraph 3 of this Agreement and such
violation continues after the Employee's having received notice of such
violation and thirty (30) days to cure such violation(s) to the satisfaction of
the Company's Board of Directors. The Company may immediately terminate this
Agreement upon (i) determination by the Company's Board of Directors that
Employee has willfully defaulted on a material obligation of the Agreement, (ii)
determination by the Company's Board of Directors that there has been a
defalcation of the Company's funds by Employee, (iii) conviction of Employee on
a felony charge or conviction of a misdemeanor which impairs the Employee's
ability to substantially perform his duties with the Company, or (iv)
determination by the Company's Board of Directors that the Employee has had
unauthorized discussions of the Company's business activities, or improperly
disclosed trade secrets or confidential information concerning the Company's
business activities or proposed business activities. At such time as the
Company's Board of Directors addresses such charges, the Employee may submit a
written statement regarding such claims and present a defense against such
claims.
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(c) Termination for Employer's Breach. Employee shall have the right to
terminate this Agreement if the Company materially breaches any of the
provisions hereof and such breach is not cured within thirty (30) days after the
Company has received written notice from the Employee. In such event, or in the
event of a wrongful termination of the Employee, all moneys due to the Employee
through the term of the Agreement shall be paid by the Company in a lump sum
amount within thirty(30) days of Employee's termination with bonuses to be paid
when earned through the remainder of the term of this Agreement. Employee shall
have no obligation to mitigate any losses or damages incurred as a result of
such termination.
(d) Termination by Death. If employment terminates by reason of the
Employee's death, the Company will pay the Employee's estate a lump sum payment
equivalent to six (6) months salary; other benefits will be determined in
accordance with the Company's survivor's benefits, insurance and other
applicable programs and plans, then in effect.
(e) Change of Control. In the event of a change of control, all
Options and Grants of Common Stock shall be fully vested. A change of control is
defined as (i) a tender offer, merger or other transactions as a result of which
any person or group becomes the owner of more than 50% of the Common Stock of
the Company or the combined voting power of the Company's then outstanding
securities, (ii) a liquidation or sale of substantially all of the Company's
assets, (iii) the individuals constituting the Board of Directors or individuals
nominated by them cease to constitute a majority of the Board of Directors, or
(iv) the Company's merger or consolidation with any other corporation (other
than a wholly-owned subsidiary), if the Company is not the surviving corporation
(or survives only as a subsidiary of another corporation).
6. CONFIDENTIAL AND PROPRIETARY INFORMATION. Employee agrees to keep secret
all confidential information, trade secrets or proprietary information acquired
by the Employee during his employment concerning the business and affairs of the
Company (the "Information") and further agrees for a period of one (1) year
after the termination of his employment, for any reason, not to disclose any
such Information to any person, firm or corporation other than as directed by
the Employer, unless and until such Information becomes known outside of the
Company (other that through a violation by the Employee of his obligations
hereunder). Employee also agrees, upon the company's request, to execute a
confidential nondisclosure agreement if requested.
7. MISCELLANEOUS PROVISIONS.
(a) Successors. The Company will require any successor (whether direct
or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the company would be required to perform it if no such succession
had taken place. Failure of the company to obtain such assumption and agreement
prior to the effectiveness of any such succession shall be a breach of the
Agreement and shall entitle the Employee to compensation from the Company in
the same amount and on the same terms as the Employee is entitled to hereunder
if the Employee terminated his employment for good cause.
(b) Binding Agreement. This Agreement shall inure to the benefit of
and be enforceable by the Employee's personal or legal representatives,
executors, administrators, successors, heirs, distributees, devisees and
legatees. If the employee should die while any amount would still be payable to
the Employee hereunder if the Employee had continued to live, all such amounts,
unless otherwise provide herein, shall be paid in accordance with
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the terms of this Agreement, to the Employee's devisee, legatee or other
designee or, if there is not such designee, to the Employee's estate.
(c) Notices and Communications. All notices and communications hereunder
shall be in writing and shall be hand delivered or sent postage prepaid by
registered or certified mail, return receipt requested, to the addresses first
written or to such other address of which notice shall have been given in the
manner herein provided.
(d) Entire Agreement, Non-Assignment. This Agreement may not be
modified, amended, changed or discharged, except by a writing signed by the
parties hereto and then only to the extend herein set forth. This Agreement
shall be binding upon and inure to the benefit of the parties hereto, and any
administrator, executor and successor the Company. This Agreement may not be
assigned by either of the parties hereto without prior written consent of the
other party.
(e) Validity; Governing Law. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect. The validity, interpretation, construction and performance of this
Agreement shall be governed by the laws of the State of Ohio.
(f) Legal Expenses. All legal fees and expenses incurred by the
Employee in attempts to receive the benefits granted hereunder or to enforce
this Agreement or any of its terms will be paid by the Company providing that
Employee's claims are not dismissed in a summary proceeding.
IN WITNESS WHEREOF, the parties have executed this Agreement to be
effective as of the day and year first written above.
ABC DISPENSING TECHNOLOGIES, INC.
/s/ Xxxxxxx Xxxxxx, Secretary
-----------------------------
(Authorized Officer)
EMPLOYEE:
/s/ Xxxxxxx X. Xxxxxx, Xx.
--------------------------
XXXXXXX X. XXXXXX, XX
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