EXHIBIT 10.14
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT, dated as of the 1st day of January, 2000
(the "AGREEMENT"), is by and between USA DIGITAL, INC., a Nevada corporation
(the "COMPANY"), and XXXXXXX X. XXXXX, an individual (the "EMPLOYEE").
WITNESSETH:
WHEREAS, the Company is presently engaged in the telecommunications
industry;
WHEREAS, Employee has extensive experience in this area;
WHEREAS, the Company wishes to employ Employee for the period provided
in this Agreement and Employee is willing to serve in the employ of the Company
for such period upon the terms and conditions hereinafter set forth.
NOW THEREFORE, in consideration of the mutual covenants herein
contained, the parties, intending to be legally bound, hereby agree as follows:
1. EMPLOYMENT
The Company hereby employs Employee upon the terms and conditions
herein contained, and Employee hereby accepts such employment for the term
described below. Employee is and shall be employed in the capacity of the
Company's Vice President of Operations, and Employee's initial responsibilities
shall include managing the network and switching operations and the management
information systems of the Company and its subsidiaries during the term of this
Agreement and Employee shall have such other duties, responsibilities and
authority as are assigned to him by the President or the Board of Directors of
the Company.
Throughout the term of this Agreement, Employee shall devote his best
efforts and substantially all of his business time and services to the business
and affairs of the Company.
2. TERM OF AGREEMENT
The initial term of employment under this Agreement shall be for a
period of three (3) years beginning on January 1, 2000 (the "EFFECTIVE DATE").
After the expiration of such initial employment period, the term of Employee's
employment hereunder shall automatically be extended without further action by
the parties for successive one (1) year renewal terms, provided that if either
party gives the other party at least thirty (30) days' advance written notice of
his or its intention to not renew this Agreement for an additional term, the
Agreement shall terminate upon the expiration of the then current term.
Notwithstanding the foregoing, the Company shall be entitled to
terminate this Agreement immediately, subject to a continuing obligation to make
any payments required under Section 5
below, if Employee: (i) becomes disabled as described in Section 5(b), (ii) is
terminated for Cause, as defined in Section 5(c), or (iii) voluntarily
terminates his employment before the current term of this Agreement expires, as
described in Section 5(d).
3. SALARY
During the term of this Agreement, for all services rendered hereunder,
Employee shall receive a base salary ("BASE SALARY") at a rate of not less than
Eighty-Four Thousand and No/100 Dollars ($84,000.00) per annum. The Base Salary
shall be payable in equal installments in accordance with the Company's payroll
practices but not less than once per month. The Compensation Committee of the
Board shall consult with the President and review this base salary at annual
intervals, and may adjust Employee's annual base salary upward from time to time
if the Committee deems such adjustment to be appropriate.
4. ADDITIONAL COMPENSATION AND BENEFITS
Employee shall receive the following additional compensation and
welfare and fringe benefits:
(A) MEDICAL INSURANCE. The Company shall provide Employee with health
insurance coverage no less favorable than that from time to time made available
to other key employees.
(B) BUSINESS EXPENSES. The Company shall reimburse Employee for all
reasonable expenses he incurs in promoting the Company's business, including
expenses for travel, entertainment of business associates and similar items,
upon presentation by Employee from time to time of an itemized account of such
expenditures.
(C) CAR ALLOWANCE. Employee shall be entitled to receive a monthly car
allowance in the amount of Five Hundred Dollars ($500.00).
(D) CELLULAR TELEPHONE. The Company shall reimburse Employee for all
reasonable cellular telephone expenses he incurs in conducting the Company's
business, including charges for a monthly cellular telephone service, charges
for telephone calls, and repair and maintenance expenses, upon presentation by
Employee from time to time of an itemized account of such expenditures.
In addition to the benefits provided pursuant to the preceding
paragraphs of this Section 4, Employee shall be eligible to participate in such
other Employee compensation and retirement plans of the Company as are
applicable generally to other officers, and in such welfare benefit plans,
programs, practices and policies of the Company as are generally applicable to
other key employees.
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5. PAYMENTS UPON TERMINATION
(A) INVOLUNTARY TERMINATION. If Employee's employment is terminated by
the Company during the term of this Agreement, Employee shall be entitled to
receive his base salary accrued through the date of termination. Employee shall
also receive any nonforfeitable benefits already earned and payable to him under
the terms of any deferred compensation, incentive or other benefit plan
maintained by the Company, payable in accordance with the terms of the
applicable plan.
If the termination is not for death, failure to renew as provided in
Section 2, disability as described in Section 5(b), for Cause as described in
Section 5(c) or a voluntary termination by Employee as described in Section
5(d), the Company shall also be obligated to pay to Employee an amount equal to
an aggregate of all salary payments which would otherwise be due Employee for
the months remaining in the then current term of this Agreement. Any such
payment shall, at the option of the Company, be made either in equal bi-monthly
installments over the remaining term of this Agreement, or in a lump sum cash
payment on the date of termination.
(B) DISABILITY. The Company shall be entitled to terminate this
Agreement if the Board determines that Employee has been unable to attend to his
duties for at least ninety (90) days because of a medically diagnosable physical
or mental condition. Upon such termination, the Company shall pay to Employee a
monthly disability benefit equal to one-twenty-fourth (1/24th) of his current
annual base salary at the time he became permanently disabled. Payment of such
disability benefit shall commence on the last day of the month following the
date of the termination by reason of permanent disability and cease with the
earliest of: (i) the month in which Employee returns to active employment,
either with the Company or otherwise, (ii) the end of the initial term of this
Agreement, or the current renewal term, as the case may be, or (iii) the twelfth
month after the date of the termination. Any amounts payable under this Section
5(b) shall be reduced by any amounts paid to Employee under any long-term
disability plan or other disability program or insurance policies maintained or
provided by the Company.
(C) TERMINATION FOR CAUSE. If Employee's employment is terminated by
the Company for Cause, the amount Employee shall be entitled to receive from the
Company shall be limited to his base salary accrued through the date of
termination, and any nonforfeitable benefits already earned and payable to
Employee under the terms of deferred compensation or incentive plans maintained
by the Company. For purposes of this Agreement, the term "CAUSE" shall be
limited to: (i) any action by Employee involving willful disloyalty to the
Company, such as embezzlement, fraud, misappropriation of corporate assets or a
breach of the covenants set forth in Sections 8 or 9 hereof; (ii) Employee being
convicted of a felony; (iii) Employee being convicted of any lesser crime or
offense committed in connection with the performance of his duties hereunder or
involving moral turpitude; or (iv) the intentional and willful failure by
Employee to substantially perform his duties hereunder as directed by the Board
(other than any such failure resulting from Employee's incapacity due to
physical or mental disability); provided that in the event of a termination for
Cause under this Section 5(c)(iv), Employee shall have a period of thirty (30)
days
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in which to cure such breach after receiving notice from the Company specifying
in reasonable detail the nature of such breach.
(D) VOLUNTARY TERMINATION BY EMPLOYEE. If Employee resigns or otherwise
voluntarily terminates his employment before the end of the current term of this
Agreement, the amount Employee shall be entitled to receive from the Company
shall be limited to his base salary accrued through the date of termination, and
any nonforfeitable benefits already earned and payable to Employee under the
terms of any deferred compensation or incentive plans of the Company. For
purposes of this Section, a resignation by Employee shall not be deemed to be
voluntary if Employee resigns during the period of three (3) months after the
date he is: (i) assigned to a position of lesser rank (other than for Cause, or
by reason of permanent disability), or (ii) assigned duties materially
inconsistent with such position.
6. DEATH
If Employee dies during the term of this Agreement, the Company shall
pay to Employee's estate a lump sum payment equal to the sum of Employee's base
salary accrued through the date of death plus the total unpaid amount of any
bonuses earned with respect to the fiscal year of the Company most recently
ended. In addition, the death benefits payable by reason of Employee's death
under any retirement, deferred compensation or other employee benefit plan
maintained by the Company shall be paid to the beneficiary designated by
Employee in accordance with the terms of the applicable plan or plans.
7. WITHHOLDING
The Company shall, to the extent permitted by law, have the right to
withhold and deduct from any payment hereunder any federal, state or local taxes
of any kind required by law to be withheld with respect to any such payment.
8. PROTECTION OF CONFIDENTIAL INFORMATION
Employee agrees that, both during the term of this Agreement and
thereafter, he will keep all confidential and proprietary information of the
Company or relating to its business (including, but not limited to, information
regarding the Company's customers, pricing policies, methods of operation,
proprietary computer programs and trade secrets) confidential, and that he will
not (except with the Company's prior written consent), while in the employ of
the Company or thereafter, disclose any such confidential information to any
person, firm, corporation, association or other entity, other than in
furtherance of his duties hereunder, and then only to those with a "need to
know." Employee shall not make use of any such confidential information for his
own purposes or for the benefit of any person, firm, corporation, association or
other entity (except the Company) under any circumstances during or after the
term of his employment. The foregoing shall not apply to any information which
is already in the public domain, or is generally disclosed by the Company or is
otherwise in the public domain at the time of disclosure.
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Employee recognizes that because his work for the Company will bring
him into contact with confidential and proprietary information of the Company,
the restrictions of this Section 8 are required for the reasonable protection of
the Company and its investments and for the Company's reliance on and confidence
in Employee. For purposes of this Section 8, the term "Company" means the
Company, any of the Company's subsidiary corporations and its other affiliated
entities.
9. COVENANT NOT TO COMPETE; NON SOLICITATION
Employee hereby agrees that he will not, either during the Employment
Term or during the period of one (1) year from the time Employee's employment
under this Agreement is terminated, engage in any business activities on behalf
of any enterprise which competes with the Company in the telecommunications
business. Employee will be deemed to be engaged in such competitive business
activities if he participates in such a business enterprise as an employee,
officer, director, consultant, agent, partner, proprietor, or other participant;
provided that the ownership of no more than two percent (2%) of the stock of a
publicly traded corporation engaged in a competitive business, shall not be
deemed to be engaging in competitive business activities.
Employee agrees that he shall not, for a period of one (1) year from
the time his employment under this Agreement ceases (for whatever reason), or,
if later, during any period in which he is receiving monthly severance payments
under Section 5 of this Agreement:
(a) solicit any employee or full-time consultant of the Company for the
purposes of hiring or retaining such employee or consultant, or
(b) contact any present or prospective client of the Company to solicit
such a person to enter into any business transaction, other than with
the Company or with one of the Company's affiliates.
For this purpose, Employee shall be considered to be receiving monthly severance
payments under Section 5 of this Agreement during any period for which he would
be entitled to receive such severance payments.
10. INJUNCTIVE RELIEF
Employee acknowledges and agrees that it would be difficult to fully
compensate the Company for damages resulting from the breach or threatened
breach of the covenants set forth in Sections 8 and 9 of this Agreement and
accordingly agrees that the Company shall be entitled to temporary and
injunctive relief, including temporary restraining orders, preliminary
injunctions and permanent injunctions, to enforce such provisions in any action
or proceeding instituted in the Circuit Court of Hillsborough County, Florida,
or in any court in the State of Florida having subject matter jurisdiction, and
the Company shall not be required to post a bond in order to receive such
relief. This provision with respect to injunctive relief shall not, however,
diminish the Company's right to claim and recover damages.
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It is expressly understood and agreed that although the parties
consider the restrictions contained in this Agreement to be reasonable, if a
court determines that the time or territory or any other restriction contained
in this Agreement is an unenforceable restriction on the activities of Employee,
no such provision of this Agreement shall be rendered void but shall be deemed
amended to apply as to such maximum time and territory and to such extent as
such court may judicially determine or indicate to be reasonable.
11. SEPARABILITY
If any provision of this Agreement shall be declared to be invalid or
unenforceable, in whole or in part, such invalidity or unenforceability shall
not affect the remaining provisions hereof which shall remain in full force and
effect.
12. ASSIGNMENT
This Agreement shall be binding upon and inure to the benefit of the
heirs and representatives of Employee and the assigns and successors of the
Company, but neither this Agreement nor any rights hereunder shall be assignable
or otherwise subject to hypothecation by Employee.
13. ENTIRE AGREEMENT
This Agreement represents the entire agreement of the parties and shall
supersede any and all previous or contemporaneous contracts, arrangements or
understandings between the Company and Employee. The Agreement may not be
modified or amended other than by mutual written agreement of the parties
hereto.
14. GOVERNING LAW
This Agreement shall be construed, interpreted, and governed in
accordance with the laws of the State of Florida.
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15. COUNTERPARTS
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which shall constitute but one and
the same Agreement.
IN WITNESS WHEREOF, the Company has caused this Agreement to be duly
executed, and Employee has hereunto set his hand, as of the day and year first
above written.
Attest: USA DIGITAL, INC.
By: /s/ Xxxx X. Xxxx
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Secretary Xxxx X. Xxxx, Its President
Witness: EMPLOYEE:
/s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx
