EXHIBIT 10(U)
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement"), made this 15th day of
July, 1996, between U.S. TECHNOLOGIES, INC., a Florida Corporation with its
principal executive offices at 0000 Xxxxxxxx Xxxxxx Xxxx., Xxxxx, Xxxxxxx 00000,
(the "Company"), and XXXXX X. XXXXXX ("Employee").
INTRODUCTION
The Company desires to continue to employ Employee, and Employee
desires to continue his employment with the Company. In consideration of the
mutual covenants and promises contained herein, and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged by
the parties hereto, the parties hereto, intending to be legally bound hereby,
agree as follows:
1. Term of Employment. The Company hereby continues to employ Employee
and Employee hereby accept the continuation of his employment with the Company
upon the terms set forth in this Agreement for a period of three (3) years
commencing on the date of this Agreement (the "Commencement Date"), unless
sooner terminated in accordance with the provisions of Section 4. This Agreement
shall automatically renew for one (1) year periods following the termination
date unless either party shall give at least thirty (30) days written notice to
the other party of showing an intention to terminate the Agreement at the end of
the then current term or if this Agreement is terminated by the mutual consent
of the parties.
2. Title Capacity. Employee shall serve as the President of the Company
and shall have such authority as is delegated to Employee by the Board of
Directors of the Company.
Employee hereby accepts the employment and agrees to undertake the
duties and responsibilities inherent in Employee's position and such other
duties and responsibilities as the Board of Directors of the Company shall from
time to time reasonably assign to Employee. Employee agrees to devote Employee's
entire business time to the business and interest of the Company, and those
companies affiliated with the Company during the Employment Period and Employee
agrees to abide by the ordinary, customary and reasonable rules, regulations,
instructions, personnel practices and policies of the Company and any changes
therein which may be adopted from time to time by the Company. Because Company
is a one hundred percent (100%) owned subsidiary of Pacific Animated Imaging
Corporation ("PAI") Employee agrees to render such services and provide such
assistance to PAI as requested by the Chief Executive Officer of PAI from time
to time.
3. Compensation and Benefits.
3.1 Salary. The Company shall pay Employee such annual salary
as is set forth in the Compensation Schedule attached hereto and made a part
hereof as Exhibit "A". By mutual agreement of the parties, Exhibit "A" may be
revised from time to time.
3.2 Fringe Benefits. Employee shall be entitled to participate
in all fringe benefit programs that the Company establishes and makes available
to its officer-employees generally, if any. The Employee shall be entitled to
vacation, sick leave and personal leave each year of employment in accordance
with Company policy as revised from time to time, to be taken at such times as
may be mutually agreeable to Employee and the Board of Directors of the Company.
3.3 Reimbursement of Expenses. The Company shall reimburse
Employee for all reasonable travel, entertainment and other expenses incurred or
paid by Employee in connection with, or related to, the performance of
Employee's duties, responsibilities or services under this Agreement, upon
presentation by the Employee of documentation, expense statements, vouchers
and/or such other supporting information as the Company may request.
3.4 Automobile Allowance. During the term of this Agreement
and any renewal thereof, Employee shall be provided with a lease automobile.
4. Employment Termination. The employment of Employee by the Company
pursuant to this Agreement shall terminate upon the occurrence of any of the
following:
4.1 Expiration of the Employment Period in accordance with
Section 1;
4.2 At the election of the Company, for "Cause", immediately
upon written notice from PAI to the Employee. For the purposes of this Section
4.2, "Cause" for termination shall be deemed to include only (a) the direct or
indirect competition by Employee with Company and/or PAI (as hereinafter defined
in Section 6.); (b) the conviction of an Employee of a felony or an act
involving moral turpitude; (c) the drug or alcohol abuse by Employee, which
impairs the performance of Employee's duties, but only if Employee fails to seek
appropriate counseling or fails to complete a prescribed counseling program; or
(d) the failure of Employee to comply with any material term of this Agreement
after written notice of such noncompliance or nonperformance is received by
Employee and the Employee fails to comply or perform within ten (10) days of the
receipt of such written notice counting as the first day of the ten (10) day
period the first business day after receipt of such notice. Cause shall not be
construed as a failure of Employee to perform services for Company substantially
different from the services performed by Employee during the initial term of
this Agreement.
4.3 Upon the Disability of the Employee. As used in this
Agreement, the term "Disability" shall mean the inability of the Employee, due
to a physical or mental disability, for a period of thirty (30) days, whether or
not consecutive, during any sixty (60) day period to perform the normal and
customary services required of Employee pursuant to this Agreement. A
determination of disability shall be made by a physician satisfactory to both
Employee and the Company, provided that, if Employee and the Company do not
agree on a physician, Employee and the Company shall each select a physician and
such two physicians together shall select a third physician, whose determination
as to disability shall be binding on the parties.
4.4 Death of Employee.
4.5 By Employee for "Good Reason". "Good Reason" shall mean
the following, unless such circumstances are fully corrected within ten (10)
days after the Employee notifies the Company in writing that he intends to
terminate his employment for Good Reason:
(a) the assignment, without the Employee's prior
written consent to another person, of Employee's primary duties that the
Employee was responsible for during the initial term of this Agreement, or
a significant adverse alteration in the nature or status of the Employee's
employment from those in effect during the initial term of this Agreement;
(b) any reduction by the Company in Employee's
aggregate compensation (other than as agreed to by Employee) in effect on the
date hereof or as the same may be increased after such date.
5. Effect of Termination.
5.1 Termination due to Expiration of Employment Period. If
Employee' s employment is terminated due to the expiration of the Employment
Period pursuant to Section 4.1, the Company shall pay Employee the Compensation
per Exhibit "A" (including accrued bonuses, if any) and benefits due to Employee
under Section 3.2, 3.3 and 3.4 through the last day of Employee' s actual
employment hereunder.
5.2 Termination for Cause. In the event that Employee's
employment is terminated for "Cause" pursuant to Section 4.2, the Company shall
pay Employee the Compensation per Exhibit "A" (not including accrued bonuses, if
any) and benefits due to Employee under Section 3.2, 3.3 and 3.4 through the
last day of Employee's actual employment hereunder.
5.3 Termination by Company Not for Cause. In the event that
Employee's employment is terminated by the Company Not for "Cause", the Company
shall pay Employee compensation at the rate of two hundred thousand dollars
($200,000) per year for the duration of the non-competition section as defined
in section 6.1 herein, which at the option of the Company may be shortened.
5.4 Termination for Death or Disability. If Employee's
employment is terminated by reason of death or disability pursuant to Section
4.3. or Section 4.4., the Company shall pay the estate of Employee or Employee,
as the case may be, the Compensation per Exhibit "A" (including accrued bonuses,
if any,) and benefits under Sections 3.2, 3.3 and 3.4 which would otherwise be
payable to Employee up to the end of the month in which the termination of this
Agreement for such death or disability occurs.
5.5 Termination for Good Reason. In the event the Employee's
employment is terminated by him for "Good Reason" pursuant to Section 4.5, the
Company shall pay the Employee compensation at the rate of two hundred thousand
dollars ($200,000) per year for the duration of the non-competition section as
defined in section 6.1 herein, which at the option of the Company may be
shortened.
5.6 Termination by Employee not for Good Reason. In the event
Employee's employment is terminated by him not for "Good Reason", the Company
shall pay Employee the Compensation per Exhibit "A" (not including accrued
bonus, if any) and benefits due Employee under Section 3.2, 3.3 and 3.4 through
the last day of Employee's actual employment hereunder.
6. Non-Competition.
6.1 Employee agrees that, during the Employment Period and for
a period of time equal to the duration of Employee's employment with the
Company, but in no instance to exceed two (2) years after the termination of the
employment period for any reason:
(a) Employee will not recruit or solicit any employee
of the Company, or its other subsidiaries and affiliated companies or other-
wise induce any employee to leave the employment of PAI, the Company,
Company's or PAI's subsidiaries and affiliated companies to become an
employee of or otherwise
become associated with Employee or any firm, corporation, business or
institution with which Employee is or may become associated;
(b) Employee will not solicit or divert the business
or patronage of any of the customers or accounts of PAI, the Company,
Company's subsidiaries and affiliated companies or prospective customers or
accounts of the aforementioned, which were contracted, solicited or served by
the Company while Employee was employed by the Company to a business directly
or indirectly in competition with PAI, the Company, Company's or PAI's
subsidiaries and affiliated companies;
(c) Employee will not engage or participate in any
line of business related to or involving in any way computer software, as an
employer, employee, principal, partner, officer, stockholder, agent,
independent contractor or otherwise, directly or indirectly, alone, or in
concert with another individual or entity; and
(d) Employee will not compete with Company or PAI,
directly or this subsection (d), "compete", or any variation thereof, means
the Employee's engagement or participation in, or furnishing of aid or
assistance in connection with, the distribution, sale, marketing or
rendering of products or services of the type or kind distributed, sold,
marketed or rendered by PAI, the Company, the Company's or PAI's subsidiaries
or affiliated companies during employment or after termination of employment,
including those products or services that the Company, the Company's
subsidiaries or affiliated companies, as the case may be, was in the process of
developing or designing for distribution, sale, marketing or rendering at such
time.
6.2 The parties to this Agreement consider the restrictions
contained herein reasonable. If, however, such restrictions are found by any
court having jurisdiction to be unreasonable because they are (or one of them
is, as the case may be) overly broad, then such restriction(s) will nevertheless
remain effective, but shall be considered amended in whatever manner is
considered reasonable by that court, and as so amended shall be enforced.
6.3 If there is any breach by the Employee of any of the
covenants contained in this Section 6., the damage to PAI, the Company, the
Company's or PAI's subsidiaries or affiliated companies will be substantial,
although difficult to ascertain, and money damages alone will not afford the
injured party an adequate remedy. Therefore, if any breach occurs, in addition
to such other remedies as may be provided by law, PAI, the Company, the
Company's or PAI's subsidiaries or affiliated companies, as the case may be, has
the right to specific performance of the covenants of the Employee contained in
this Agreement by way of temporary or permanent injunctive relief.
7. Non-Disclosure. Employee agrees not to disclose to any third party,
or to use for Employee's own benefit or for the benefit of any third party, any
trade secrets or confidential or other proprietary information relating to the
products, services, markets, customers, suppliers or current or planned business
operations of PAI, the Company, the Company's and PAI's subsidiaries and
affiliated companies without the Company's prior written consent. Employee
further agrees that all documents, notes, letters, records, models, prototypes,
computer programs and other tangible and intangible evidence of such trade
secrets or confidential or other proprietary information are the sole and
exclusive property of PAI, the Company, the Company's or PAI's subsidiaries and
affiliated companies; that Employee shall surrender all such evidence in
Employee's possession or control to the Company upon the termination of the
Employment Period or at any other time upon request and that Employee shall not
retain or use any copies or summaries thereof.
8. Inventions, Improvements, Copyrights, Ideas and Similar Creative
Property. Employee agrees that any inventions, improvements or ideas which
Employee may make or conceive, and any copyrightable subject matter of which
Employee may be the author, either solely or jointly with others, which Employee
makes, conceives, or authors during the period of Employee's employment with the
Company, shall be the property of PAI, the Company, the Company's or PAI's
subsidiaries or affiliated companies, as the case may be, and that Employee will
promptly disclose all such inventions, improvements, ideas and material to PAI,
the Company, the Company's or PAI's subsidiary or affiliated companies, as the
case may be, and that on request, Employee will execute all applications,
assignments, and other papers necessary to enable PAI, the Company, the
Company's or PAI's subsidiary or affiliates to obtain full protection and title
in all countries to such inventions, improvements, ideas and matter.
9. Arbitration. Except as provided in Section 6.3, any dispute,
including a'claimed breach of the terms hereof, arising out of or in connection
with this Agreement shall be resolved by arbitration conducted by the American
Arbitration Association in Tampa, Florida in accordance with its Rules then in
existence. The arbitrators shall not contravene or vary in any respect any of
the terms or provisions of this Agreement. The award of the arbitrators shall be
final and binding upon the parties hereto, their heirs, administrators,
executors, successors and assigns and judgment upon such award may be entered in
any court having jurisdiction thereof.
10. Notices. All notices required or permitted under this Agreement
shall be in writing and shall be deemed effective upon personal delivery or upon
deposit in the United States Post Office, postage prepaid, by registered mail
return receipt requested, or when delivered by a nationally recognized overnight
delivery service issuing a receipt, addressed to the other party at the address
shown above or at such other address or addresses as either party shall provide
to the other.
11. Pronouns. Whenever the context may require, any pronouns used in
this Agreement shall include the corresponding masculine, feminine or neuter
forms, and the singular forms of nouns and pronouns shall include the plural,
and vice versa.
12. Construction of Agreement. The parties to this Agreement and their
respective counsel have reviewed this Agreement and have had the opportunity to
revise this Agreement, and the normal rule of construction to the effect that
any ambiguities are to be resolved against the drafting party shall not be
employed in the interpretation of this Agreement.
13. Entire Agreement. This Agreement constitutes the entire agreement
between the parties and supersedes all prior agreements and understandings,
whether written or oral, relating to the subject matter of this Agreement.
14. Amendment. This Agreement may be amended or modified only by a
written instrument executed by both the Company and the Employee.
15. Governing Law. This Agreement shall be construed, interpreted and
enforced in accordance with the laws of the State of Florida.
16. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of both parties and their respective successors and
assigns, including any corporation with which or into which the Company may be
merged or which may succeed to its assets or business, provided however, that
the obligations of the Employee are personal and shall not be assigned by
Employee.
17. Miscellaneous.
17.1 No delay or omission by the Company in exercising any
right under this Agreement shall operate as a waiver of that or any other right.
A waiver or consent given by the Company on any one occasion shall be effective
only in that instance and shall not be construed as a bar or waiver of any right
on any other occasion.
17.2 The captions of the Sections of this Agreement are for
convenience of reference only and in no way define, limit or affect the scope or
substance of any Section of this Agreement.
17.3 In the case any provision of this Agreement shall be
invalid, illegal or otherwise unenforceable, the validity, legality and
enforceability of the remaining provisions shall in no way be affected or
impaired thereby.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year set forth above. U.S. TECHNOLOGIES, INC.
By:
Xxxx X. Xxxxxxx, For the Board of Directors
Xxxxx X. Xxxxxx, Employee
EXHIBIT "A"
COMPENSATION SCHEDULE
Pursuant to the attached Employment Agreement, the compensation payable to
Employee shall be as follows: One hundred thousand dollars and 00/100 ($100,000)
on an annual basis.
IN WITNESS WHEREOF, the parties hereto have executed this Compensation Schedule
the date and year written above.
U.S. TECHNOLOGIES, INC.
By:
Xxxx X. Xxxxxxx For the Board of Directors
Xxxxx X. Xxxxxx, Employee
