Exhibit 10.18
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into as of the 1/st/
day of January, 2002 (the "Effective Date"), by and between INTERNATIONAL ASSETS
HOLDING CORPORATION, a Delaware corporation (the "Company"), and Xxxxxx X.
Xxxxxxxxxxx (the "Executive").
R E C I T A L S
A. The Company, directly or through its subsidiaries, operates a
financial services company, including a full-service securities brokerage firm
specializing in global investing, a registered investment advisor providing
clients with investment advisory services, and other securities businesses
servicing its clients.
B. The Executive shall be, pursuant to the terms of this Agreement, the
Executive Vice President and Chief Operating Officer of the Company, and may
hold such offices in its subsidiaries as may be appropriate for the conduct of
its business.
C. The Company is a publicly held entity, having previously offered
shares of the Company's common stock pursuant to a registration statement, and
continues to file reports as to the Company's business.
D. The Board of Directors of the Company (the "Board") considers it
essential to the best interests of the Company that the Executive remain with
the Company after the completion of the present term of his employment.
E. In order to induce the Executive to accept and continue his employment
with the Company, the Company desires to enter into this Agreement with the
Executive, and to be bound by it.
F. The Executive, desiring to accept and proposing to continue his
employment by the Company, agrees to be bound by the covenants herein.
NOW THEREFORE, in consideration of the mutual covenants and agreements set
forth hereinafter, the Company and the Executive agree as follows:
1. Recitals. All of the above recitals are true and correct.
2. Term. The term of this Agreement shall be for a period of one year
commencing on the Effective Date, subject, however, to prior termination as
herein
Employment Agreement of Xxxxxx X. Xxxxxxxxxxx
Page 2
provided. Thereafter, this Agreement may be extended by the mutual written
agreement of the Company and the Executive on a yearly basis.
3. Duties. During the period of employment (except as otherwise agreed by
the Executive), the Executive will be employed as the Executive Vice President
and Chief Operating Officer of the Company and shall have powers and duties as
may from time to time be delegated to the Executive by the Chief Executive
Officer or the Board. The Executive shall report to the Chairman of the Board of
Directors of the Company. The Executive shall devote substantially all of the
Executive's business time to the affairs of the Company.
4. Indemnification. The Company agrees to defend, indemnify and hold
harmless the Executive ("Indemnified Party") for acts in his capacity as
Executive to the fullest extent permitted by Delaware corporate law at the
present time (or as such right of indemnity may be increased in the future). The
Company agrees to reimburse the Indemnified Party on a monthly basis for any
cost of defending any action or investigation (including reasonable attorneys'
fees and expenses) subject to an undertaking from the Indemnified Party to repay
the Company if the Indemnified Party is determined not to be entitled to such
indemnity by a court of competent jurisdiction.
5. Compensation and Related Matters.
(a) Basic Salary. As a compensation for the duties to be performed by
the Executive hereunder, the Company will pay the Executive a base salary at an
annual rate of $150,000 per year of the Company through December 31, 2002, and
such annual salary shall thereafter increase effective as of the first day of
each succeeding calendar year commencing after December 31, 2002 by the greater
of (i) the change in the consumer price index during the last completed fiscal
year, or (ii) such other amount as the Board in its discretion determines to be
appropriate. The Executive's base salary shall be payable in accordance with the
customary payroll practices of the company as in effect from time to time during
the period of employment.
(b) Bonus Plan.
(i) In addition to the base salary, the Executive shall be
entitled to additional compensation in an amount determined by the Board taking
into account the consolidated pre-tax earnings of the Company (including its
subsidiaries) for each fiscal year that ends during the term hereof.
(ii) For purposes of this Section 5(b), the "consolidated
pre-tax earnings of the Company" shall be determined by the independent public
accountants then regularly servicing the Company, in accordance with generally
accepted accounting principles, consistently applied, based on the audited
consolidated financial statements of the Company for such fiscal year, which
determination shall be binding on the parties hereto.
Employment Agreement of Xxxxxx X. Xxxxxxxxxxx
Page 3
(iii) Additional compensation authorized by the Board shall be
paid within sixty days after the later of: (A) the date on which the Company's
independent accountants delivers its final report on the audited consolidated
financial statements of the Company for the fiscal year ending during the
calendar year during which this Agreement remains in effect, or (B) December
31/st/.
(c) Stock Options.
(i) The Executive shall be eligible to participate in the
Stock Option Plan (the "Plan") and shall be considered by the Company's Board or
the Compensation Committee to receive grants of options thereunder at the same
times as consideration shall be given by the Board or such committee to the
grants of stock options generally to senior executive officers of the Company.
If the Plan shall be terminated or if no options remain available for grant
thereunder, the Executive shall be entitled to participate in such other
incentive program as the Company may substitute for the Plan for its senior
executive officers.
(ii) In connection with the original employment of the
Executive by the Company effective as of December 22, 2000, the Company
committed to issue to the Executive 20,000 stock options granted December 22,
2000, an additional 20,000 stock options granted December 22, 2001, and an
additional 20,000 stock options granted December 22, 2002. It was agreed by the
parties that each set of stock options would have a three year vesting schedule,
and that each outstanding option would become fully vested and non-forfeitable
in the event of a change of control of the Company, and such terms are
incorporated herein.
(d) Additional Compensation. The Company may award additional bonuses
to the Executive from time to time in amounts as determined by the Board or a
committee of the Board, and such compensation shall be payable in the manner and
at the time or times directed by the Board or its committee.
(e) Reimbursement of Expenses. During the term of this Agreement, the
Company shall promptly pay or reimburse the Executive for all reasonable
business expenses actually incurred or paid by the Executive in the performance
of his services hereunder (including a monthly payment of $700.00 toward the
cost of leasing and maintaining a car for the use of the Executive, and the
provision of suitable liability insurance for that vehicle by the Executive for
the protection of the Executive and Company), all in accordance with the
policies and procedures of the Company for the reimbursement of business
expenses of its senior executive officers, provided that the Executive properly
accounts therefor in accordance with Company policy.
(f) Benefits. The Company shall, at its sole cost, and expense,
provide life insurance, medical insurance, disability insurance, retirement and
other benefits comparable to those provided by comparable companies to their
senior executive officers.
6. Vacation, Days Off. The Executive may take a maximum of 4 weeks
vacation, at times to be determined in the manner most convenient for the
business of the
Employment Agreement of Xxxxxx X. Xxxxxxxxxxx
Page 4
Company. In addition, the Executive may take time off at such times as may be
determined by the Board to attend such meetings and postgraduate courses as may
comply with regulatory and licensing requirements of the businesses conducted by
the Company, or which otherwise directly advance the interests of the Company.
The Company may, in its discretion, reimburse the Executive for some or all of
the expenses incurred to register for or attend such training courses.
7. Termination Provisions
(a) Termination
(i) The Executive's employment hereunder shall
automatically terminate (A) upon the Executive's death or Disability (as
hereinafter defined); (B) upon written notice by the Company for "Cause" (as
hereinafter defined); or (C) upon 30 days written notice by either party.
(ii) For purposes of this Agreement, "Disability" shall
have the same meaning as that term has under a disability policy maintained for
the Executive by the Company. If no such policy exists, or if payment of
benefits under the policy is not conditioned on meeting such a definition, then
"Disability" shall mean that the Executive is unable to perform his duties
hereunder on a full-time basis for three consecutive months after reasonable
accommodation by the Company.
(iii) For purposes of this Agreement, the Company shall
have "Cause" to terminate the Executive's employment hereunder upon (A) the
willful failure by the Executive to substantially perform the Executive's duties
(other than any such failure resulting by the Executive's Disability) and
continuance of such failure for more than 30 days after the Company notifies the
Executive in writing of the Executive's failure to perform; (B) the engaging by
the Executive in willful misconduct which is injurious to the Company; (C) the
conviction of the Executive in a court of proper jurisdiction of a crime which
constitutes a felony in respect of the conduct of the business of the Company;
or (D) a finding by the National Association of Securities Dealers, Inc. (the
"NASD"), another self-regulatory body of competent jurisdiction (the "SRO"), or
U.S. Securities and Exchange Commission (the "SEC') that the Executive
personally violated its rules or regulations, and such finding or penalty
therefor restricts the Executive's ability to perform his obligations under this
Agreement. Notwithstanding the foregoing, the Executive shall not be deemed to
have personally violated roles or regulations of the NASD, an SRO, or the SEC,
if a finding or penalty imposed is based upon a finding that the Executive did
not adequately supervise such employee, but was not otherwise a party to the
acts constituting the misconduct by such other person. Further, the Executive
shall not be deemed to have been terminated for Cause unless and until there has
been delivered to the Executive notice that a resolution has been duly adopted
by the Board which finds that the Company has "Cause" to terminate the Executive
as contemplated in this Section 7(a), provided, that the Executive is terminated
for Cause upon conviction of a felony as identified in clause (C) above, and
upon the revocation of any license required under applicable law for the conduct
of the business of the Company by the Executive.
Employment Agreement of Xxxxxx X. Xxxxxxxxxxx
Page 5
(b) Compensation Upon Termination. If either (i) the Company shall
terminate the employment of the Executive for Cause pursuant to the provisions
of Section 7(a) hereof, or (ii) the Executive shall resign (other than as a
result of the violation of this Agreement by the Company), then the Company
shall pay the Executive 100% of the compensation set forth in Section 5 hereof
for 30 days following the date of the termination of employment. If the Company
shall terminate the employment of the Executive without Cause or the Executive
resigns as a result of a breach by the Company of its obligations to the
Executive, whether set forth herein or otherwise, then the Company shall pay the
Executive 100% of the compensation set forth in Section 5 hereof for the
remaining term of the Agreement, or six full months, whichever period shall be
greater.
8. Nondisclosure and Noncompetition.
During the period of employment hereunder and for a period of one year
after termination of this Agreement (for whatever reason), the Executive shall
not, without the written consent of the Board or a person authorized thereby,
disclose to any person or appropriate for his own use, information, knowledge or
data which is not theretofore publicly known and in the public domain that is
obtained by the Executive while in the employ of the Company (which for purposes
of this Section 8 shall include the Company or any of its subsidiaries),
respecting information about the Company, or of any products, systems, programs,
procedures, manuals, guides, confidential reports and communications,
improvements, designs or styles, customers, methods of distribution, sales,
prices, profits, costs, contracts, suppliers, business prospects, business
methods, techniques, research, trade secrets, or know-how of the Company, except
as the Executive may, in good faith, reasonably believe to be for the Company's
benefit. The Executive acknowledges that all information about the Company's
trading department customers, clients, prospects and pricing models constitutes
trade secrets under Section 688.002(4) of the Florida Statutes. Notwithstanding
the foregoing, following the termination of employment hereunder, the Executive
may disclose any information, knowledge or data of the type described to the
extent required by law in connection with any judicial or administrative
proceeding or inquiry.
In addition to the foregoing and in the interest of protecting the
Company's trade secrets, during the term of this Agreement and for a period of
one year after termination of this Agreement for any reason, the Executive shall
not, without the written consent of the Board or a person authorized thereby,
directly or indirectly, do any business with respect to, or solicit any business
similar to the business of the Company from, any of the Company's customers,
clients, or accounts without the consent of the Company; provided, that this
prohibition shall not limit the authority of the Executive (or the Executive's
new employer) to solicit business from any client or customer of the Company
that is already a customer or client of that new employer thirty days prior to
the last day the Executive is employed by the Company. In addition, Executive
shall not directly, or through any company of which Executive is an officer,
employee, or more than 5% owner, hire any employee of the Company, or attempt to
solicit any employee of, or independent contractor used by, the Company to leave
the service of the Company.
Employment Agreement of Xxxxxx X. Xxxxxxxxxxx
Page 6
Executive agrees that the restrictions of this Section 8 are reasonable as
to time, area, subject matter and otherwise due to the confidential nature of
the information and trade secrets of the Company, and the unique role and
substantial compensation of the Executive. The Executive acknowledges that he
entered into the covenants imposed by this Section 8 in connection with a prior
employment agreement, and that such restrictions are continued without
interruption under this Agreement. The covenants contained in this Section 8
shall survive the termination of the Executive's employment pursuant to this
Agreement. The foregoing provisions of this Section 8 shall be binding upon the
Executive's heirs, successors and legal representative. The Executive
acknowledges and confirms that the Company shall be entitled to specific
performance or injunctive relief without proof of monetary damages and without
further proof of irreparable injury in an action instituted in any court of
competent jurisdiction, or a proceeding before the NASD.
9. Other Directorships. The Company acknowledges and understands that the
Executive may be offered the opportunity to sit on the board of directors of
other public and private companies. The Executive agrees that he will not serve
on the board of directors of any company in competition with the Company and its
affiliates, and the Executive agrees that he will not accept any appointment to
another Board without the prior written consent of the Company, which consent
shall not be unreasonably withheld. The Company may determine that the Executive
shall not serve as a director, officer, or in any other position with an entity
that does not maintain liability insurance in an amount deemed to be adequate by
the Company. The Company agrees that the Executive shall be entitled to any fees
or salary received for his participation on the Boards of Directors of such
companies.
10. Attorneys' Fees. In the event a proceeding is brought to enforce or
interpret any part of this Agreement or the rights or obligations or any party
to this Agreement, the prevailing party shall be entitled to recover as an
element of such party's costs of suit, through all appeals, and not as damages,
reasonable attorneys' fees and paralegal's fees to be fixed by the arbitrator(s)
or court. The prevailing party shall be the party who is entitled to recover his
costs of suit or proceeding whether or not the action proceeds to final
judgment. A party not entitled to recover his costs shall not recover attorneys'
fees.
11. Successors and Assigns. This Agreement and the benefits hereunder are
personal to the Company and are not assignable or transferable by the Executive
without the written consent of the Company. The services to be performed by the
Executive hereunder may not be assigned by the Company, without the written
consent of the Executive, to any person, firm, corporation or other entity, with
the exception of a parent or subsidiary of the Company. Subject to the
foregoing, this Agreement shall be binding upon and inure to the benefit of the
Company and the Executive and the Executive's heirs and legal representatives,
and the Company's successors and permitted assigns.
12. Governing Law. This Agreement shall be construed in accordance with
and governed by the law of the State of Delaware, without regard to the
application of principles of conflict of laws.
Employment Agreement of Xxxxxx X. Xxxxxxxxxxx
Page 7
13. Notices. All notices and other communications required or permitted to
be given under this Agreement shall be in writing and shall be deemed to have
been given if delivered personally or sent by certified mail, return receipt
requested, postage prepaid, to the parties to this Agreement shall specify by
notice to the other:
If to the Company: International Assets Holding Corporation
000 Xxxx Xxxxxxx Xxxxxxx
Xxxxxxxxx Xxxxxxx, Xxxxxxx 00000
With a copy to: Xxxxxx X. Xxxxxxxxxxx, Esq.,
Xxxxxxxxx, Traurig LLP
0000 Xxx Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
If to the Executive: Xx. Xxxxxx X. Xxxxxxxxxxx
xxxxxx
Orlando, FL xxxxx
All notices and communications shall be deemed to have been received on the date
of delivery or on the third business day after the mailing thereof.
14. Modification: Waiver. No provisions of this Agreement may be modified,
waived or discharged unless such modification, waiver or discharge is approved
by the Board or a person authorized thereby, and is agreed to in a writing
signed by the Executive and such officer as may be specifically designated by
the Board. No waiver by either party hereto at the time of any breach by the
other party hereto of any condition or provision of this Agreement, or
compliance therewith, by such other party shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same time, or at any prior or
subsequent time.
15. Complete Understanding. No agreements or representations, oral or
otherwise, express or implied, with respect to the subject matter hereof have
been made by either party which are not set forth expressly in this Agreement.
This Agreement supercedes all prior agreements and understandings between the
Company and the Executive concerning his employment by the Company as well as
his compensation, including stock options, in connection therewith, except that
the Executive acknowledges that certain confidentiality provisions contained
have been subsumed and incorporated herein, and shall be deemed to continue from
the inception of his employment by the Company.
16. Headings. The headings in this Agreement are for convenience of
reference only and shall not control or affect the meaning or construction of
this Agreement.
17. Severability. The invalidity of any one or more of the words, phrases,
sentences, clauses or sections contained in this Agreement shall not affect the
enforceability of the remaining portions of this Agreement or any part thereof,
all of which are inserted conditionally on their being valid in law, and if any
one or more of the words,
Employment Agreement of Xxxxxx X. Xxxxxxxxxxx
Page 8
phrases, sentences, clauses or sections contained in this Agreement shall be
declared invalid, this Agreement shall be construed as if such invalid word or
words, phrase or phrases, sentence or sentences, clause or clauses, or section
or sections had not been inserted.
18. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
19. Arbitration. Any dispute or controversy arising under or in connection
with this Agreement shall be settled exclusively by arbitration in Orlando,
Florida, in accordance with the rules of the American Arbitration Association
then in effect.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
and year first above written.
COMPANY:
INTERNATIONAL ASSETS HOLDING
CORPORATION, a Delaware corporation
By: /s/ Diego X. Xxxxxx
Name: Diego X. Xxxxxx
Title: Chairman and CEO
EXECUTIVE:
/s/ Xxxxxx X. Xxxxxxxxxxx
Xxxxxx X. Xxxxxxxxxxx
Witness:
/s/ Xxxxxxxx X. Xxxx
Xxxxxxxx X. Xxxx
Date: June 4, 2002
