EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement"), dated as of January 31,
1998, is entered into between ▇▇▇▇ ▇▇▇▇▇▇▇, residing at ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ("Executive"), and GLOBAL TELECOMMUNICATION SOLUTIONS,
INC., a Delaware corporation having its principal office at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Company").
WHEREAS, the Company and Executive desire to provide for the employment of
Executive by the Company on the terms set forth herein;
IT IS AGREED:
1. Employment, Duties and Acceptance.
1.1 The Company hereby employs Executive as its Director of Wholesale
Sales to manage the wholesale sales operations of the Company. All of
Executive's powers and authority in any capacity shall at all times be
subject to the reasonable direction and control of the Company's Chief
Operating Officer.
1.2 The Chief Operating Officer may assign to Executive such other
duties for the Company or any Affiliate (as defined in Section 4.7) as are
consistent with Executive's status as Director of Wholesale Sales.
1.3 Executive accepts such employment and agrees to devote
substantially all of his business time, energies and attention to the
performance of his duties. Executive shall perform his duties primarily in
and from the Company's offices located in the Philadelphia metropolitan
area. During the term of this Agreement, Executive shall not be required to
re-locate from the Philadelphia metropolitan area.
2. Compensation and Benefits.
2.1 The Company shall pay to Executive a base salary ("Salary") at the
aggregate rate of $80,000 per annum during the Employment Term (as such
term is defined in Section 3.1, below). Executive's Salary shall be paid in
equal, periodic installments, in accordance with the Company's normal
payroll procedures and shall be subject to withholding taxes and other
normal payroll deductions.
2.2 In addition to the Salary, Executive and the Company's Chief
Operating Officer shall mutually agree upon a bonus plan for Executive
within thirty (30) days after execution of this Agreement (which bonus may
be payable in cash or securities of the Company).
2.3 Executive shall be entitled to such medical, dental and disability
insurance which is no less favorable than generally afforded to other
executives of the Company, subject to applicable waiting periods and other
conditions. Executive shall be entitled to four weeks of vacation in each
employment year and to a reasonable number of other days off for religious
and personal reasons.
2.4 The Company will pay or reimburse Executive for all
transportation, hotel and other expenses reasonably incurred by Executive
on business trips and for all other ordinary and reasonable out-of-pocket
expenses actually incurred by him in the conduct of the business of the
Company against itemized vouchers submitted with respect to any such
expenses approved in accordance with customary procedures.
3. Term and Termination.
3.1 The term of this Agreement commences as of January 1, 1998
and shall continue until December 31, 2000 (the "Employment Term"),
unless sooner terminated or extended as herein provided.
3.2 If Executive dies during the term of this Agreement, this
Agreement shall thereupon terminate. Notwithstanding such termination,
the Company shall pay to the legal representative of Executive's
estate the Salary due Executive pursuant to paragraph 2.1 hereof
through the one-year anniversary date of Executive's death.
3.3 The Company, by notice to Executive, may terminate this
Agreement if Executive shall fail because of illness or incapacity to
render, for six consecutive months, services of the character
contemplated by this Agreement.
3.4 The Company, by not less than 30 days notice to Executive,
may terminate this Agreement without cause at any time. In the event
of such termination without cause (i) the Company shall pay to
Executive the salary due Executive pursuant to Paragraph 2.1 through
the Employment Term as provided in Section 3.1 and (ii) the Company
shall pay to Executive each year a bonus equal to the bonus received
by the Executive under Section 2.2 during the immediately preceding
year. In the event Executive is terminated without cause during the
first year and prior to his receipt of a bonus for his first year of
employment, then, for purposes of this Section, the Company shall pay
Executive an annual bonus equal to his salary. Notwithstanding such
termination, the provisions of paragraph 4 shall survive.
3.5 The Company, by notice to Executive, may terminate this
Agreement for cause. As used herein, "cause" shall mean: (a) the
intentional refusal or failure by Executive to carry out specific
directions of the President which are of a material nature and
consistent with his status as Chief Operating Officer; (b) the
commission by Executive of a material breach of any of the provisions
of this Agreement; (c) common law fraud or dishonest action by
Executive in his relations with the Company or any of its subsidiaries
or affiliates, or with any customer or business contact of the Company
or any of its subsidiaries or affiliates ("dishonest" for these
purposes shall mean Executive's knowingly or recklessly making of a
material misstatement or omission for his personal benefit); or (d)
the conviction of Executive of any crime involving an act of moral
turpitude. Notwithstanding the foregoing, no "cause" for termination
shall be deemed to exist with respect to Executive's acts described in
clauses (a) or (b) above, unless the Company shall have given written
notice to Executive specifying the "cause" with reasonable
particularity and, within ten business days after such notice,
Executive shall not have cured or eliminated the problem or thing
giving rise to such "cause"; provided, however, that a breach of any
provision of clauses (a) or (b) above, involving the same or
substantially similar actions or conduct for which the Company
previously gave notice of termination and with respect to which,
Executive satisfactorily cured, shall be grounds for termination for
cause without any additional notice from the Company. Notwithstanding
such termination, the provisions of paragraph 4 shall survive.
3.6 The Executive, by notice to the Company, may terminate this Agreement
if the Company materially breaches any of the provisions of this Agreement.
Notwithstanding the foregoing, the Executive shall not have grounds for
termination unless Executive shall have given written notice to the Company
specifying the breach with reasonable particularity and, within ten days after
such notice, the Company shall not have cured or eliminated the problem or thing
giving rise to such breach; provided, however, that a breach of any provision of
this Agreement involving the same or substantially similar actions or conduct
for which the Executive previously gave notice of termination and with respect
to which, the Company satisfactorily cured, shall be grounds for termination for
cause without any additional notice from the Company. In the event of
termination by Executive under this Section 3.6, the Company shall pay to
Executive the Salary due Executive pursuant to paragraph 2.1 hereof through the
Employment Term. Notwithstanding such termination, the provisions of paragraph 4
shall survive termination if the Company continues to pay Executive the Salary
as provided in the immediately preceding sentence.
4. Protection of Confidential Information.
4.1 Executive acknowledges that:
(a) As a result of his employment with the Company, Executive will obtain
secret and confidential information concerning the business of the Company
and/or its subsidiaries and affiliates (referred to collectively in this
paragraph 4 as the "Company"), including, without limitation, financial
information, designs and other proprietary rights, trade secrets and "know-how,"
customers and sources ("Confidential Information").
(b) The Company will suffer substantial damage which will be difficult to
compute if, during the period of his employment with the Company or thereafter,
Executive should enter a Competitive Business with the Company or divulge
Confidential Information.
(c) The provisions of this Agreement are reasonable and necessary for the
protection of the business of the Company.
4.2 Executive agrees that he will not at any time, either
during the term of this Agreement or thereafter, divulge to any person or entity
any Confidential Information obtained or learned by him as a result of his
employment with, or prior retention by, the Company, except (i) in the course of
performing his duties hereunder; (ii) with the Company's express written
consent; (iii) to the extent that any such information is in the public domain
other than as a result of Executive's breach of any of his obligations
hereunder; or (iv) where required to be disclosed by court order, subpoena or
other government process. If Executive shall be required to make disclosure
pursuant to the provisions of clause (iv) of the preceding sentence, Executive
promptly, but in no event more than 72 hours after learning of such subpoena,
court order, or other government process, shall notify, by personal delivery or
by electronic means, confirmed by mail, the Company and, at the Company's
expense, Executive shall: (a) take all reasonably necessary and lawful steps
required by the Company to defend against the enforcement of such subpoena,
court order or other government process, and (b) permit the Company to intervene
and participate with counsel of its choice in any proceeding relating to the
enforcement thereof.
4.3 Upon termination of his employment with the Company,
Executive will promptly deliver to the Company all memoranda, notes, records,
reports, manuals, drawings, blueprints and other documents (and all copies
thereof) relating to the business of the Company and all property associated
therewith, which he may then possess or have under his control; provided,
however, subject to Executive's obligations under this Section 4, that Executive
shall be entitled to retain copies of such documents reasonably necessary to
document his financial relationship (both past and future) with the Company.
4.4 If Executive commits a breach, or threatens to commit a breach, of any
of the provisions of Section 4.2, the Company shall have the right and remedy:
(a) to have the provisions of this Agreement specifically enforced by any
court having equity jurisdiction, it being acknowledged and agreed by Executive
that the services being rendered hereunder to the Company are of a special,
unique and extraordinary character and that any such breach or threatened breach
will cause irreparable injury to the Company and that money damages will not
provide an adequate remedy to the Company; and
(b) to require Executive to account for and pay over to the Company all
monetary damages suffered by the Company as the result of any transactions
constituting a breach of any of the provisions of Section 4.2, and Executive
hereby agrees to account for and pay over such damages to the Company. Each of
the rights and remedies enumerated in this Section 4.5 shall be independent of
the other, and shall be severally enforceable, and such rights and remedies
shall be in addition to, and not in lieu of, any other rights and remedies
available to the Company under law or equity. In connection with any legal
action or proceeding arising out of Section 4.2, the prevailing party in such
action or proceeding shall be entitled to be reimbursed by the other party for
the reasonable attorneys' fees and costs incurred by the prevailing party. 4.5
If any provision of Section 4.2 is held to be unenforceable because of the
scope, duration or area of its applicability, the tribunal making such
determination shall have the power to modify such scope, duration, or area, or
all of them, and such provision or provisions shall then be applicable in such
modified form.
4.6 The provisions of this paragraph 4 shall survive the termination of
this Agreement for any reason.
4.7 As used in this Agreement, "Affiliate" shall mean any entity that,
directly or indirectly, is controlled by, controlling, or under common control
with the Company, and "Competitive Business" shall mean the design, development
and/or marketing of prepaid phone cards, enhanced and/or interactive
telecommunications services and/or products and/or any other reselling of
telecommunications access and/or the operation of telephone calling centers or
outlets or any other business engaged in by the Company and/or any of its
subsidiaries during the fiscal year prior to the termination of Executive's
employment.
5. Miscellaneous Provisions.
5.1 All notices provided for in this Agreement shall be in
writing, and shall be deemed to have been duly given when delivered personally
to the party to receive the same, when transmitted by electronic means, or when
delivered by reputable overnight courier, postage prepaid, addressed to the
party to receive the same at his or its address set forth below, or such other
address as the party to receive the same shall have specified by written notice
given in the manner provided for in this Section 6.1. All notices shall be
deemed to have been given upon actual receipt.
If to Executive:
▇▇▇▇ ▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Marked: "Personal and Confidential"
If to the Company:
Global Telecommunication Solutions, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: General Counsel
5.2 This Agreement sets forth the entire agreement of the parties relating
to the employment of Executive and are intended to supersede all prior
negotiations, understandings and agreements. No provisions of this Agreement may
be waived or changed except by a writing by the party against whom such waiver
or change is sought to be enforced. The failure of any party to require
performance of any provision hereof or thereof shall in no manner affect the
right at a later time to enforce such provision.
5.3 All questions with respect to the construction of this Agreement, and
the rights and obligations of the parties hereunder, shall be determined in
accordance with the law of the State of New York applicable to agreements made
and to be performed entirely in New York.
5.4 This Agreement shall inure to the benefit of and be binding upon the
successors and assigns of the Company. This Agreement shall not be assignable by
Executive, but shall inure to the benefit of and be binding upon Executive's
heirs and legal representatives.
5.5 Should any provision of this Agreement become legally unenforceable, no
other provision of this Agreement shall be affected, and this Agreement shall
continue as if the Agreement had been executed absent the unenforceable
provision.
5.6 Executive expressly agrees that the compensation to which he may be
entitled pursuant to Section 2 hereof may be reduced as provided in Article 8 of
the Merger and Reorganization Agreement and pursuant to any other
indemnification obligation of Executive incurred in connection with the
transactions contemplated by the Merger and Reorganization Agreement. Executive
expressly agrees that any such reduction shall not constitute a deduction from
"wages" as defined in Section 190, Article 6, of the New York Labor Law, and
that such reduction is not prohibited under Section 193, Article 6, of the New
York Labor Law. Executive shall not bring or participate in any action claiming
that such reduction is in violation of Section 193, Article 6, of the New York
Labor Law, or any other provision of applicable law. Executive shall not bring
or participate in any action claiming that such reduction is in violation of
Section 193, Article 6, of the New York Labor Law, or any other provision of
applicable law.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
EXECUTIVE
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▇▇▇▇ ▇▇▇▇▇▇▇
GLOBAL TELECOMMUNICATION SOLUTIONS, INC.
By:_________________________________
▇▇▇▇▇▇ ▇▇▇▇▇,
President
