EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (the "Agreement"), dated as of the 3rd
day of June, 1999, by and between The Harmat Organization, Inc. (the "Company")
with an address at Xxx 000, Xxxxxx, Xxx Xxxx 00000 and Xxxxxxx X. Xxxx ("Xxxx")
residing at 0000 Xxxxxx Xxxxx, Xxxxx, Xxxxxxx 00000.
WHEREAS, Sass and the Company have agreed that Sass shall
render services to the Company in the capacity of Executive Vice-President
pursuant to the terms of this Agreement.
NOW THEREFORE, in consideration of the premises and of the
mutual agreements herein set forth, the parties hereto have agreed and do hereby
mutually agree as follows:
1. Employment Term: The term of this Agreement shall commence
on the date hereof and shall expire three years thereafter (the "Employment
Period") subject to the provisions of Section 5. In the event Xxxxx Xxxxxxxxxx'x
Employment Agreement is extended, then this Employment Agreement shall be
extended for the same term.
2. Duties of Executive: Sass shall serve as Executive
Vice-President of the Company and shall be required to perform such duties as
may from time to time be required by the Board of Directors of the Company. The
Company agrees to indemnify Sass as an officer of the Company to the fullest
extent permitted by law.
3. Compensation:
(a) As compensation for his services hereunder, the Company
shall pay Sass, during the Employment Period, a base salary ("Base Salary")
payable as follows:
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(i) One Hundred Fifty Thousand Dollars ($150,000.00) for the first year;
(ii) One Hundred Seventy Thousand Dollars ($175,000.00) for the second year;
(iii) Two Hundred Thousand Dollars ($200,000.00) for the third year;
(b) The Company may withhold from payments of Employee's
salary amounts required to be withheld by the Company from time to time from
such salary under applicable Federal, State, and local laws and regulations then
in effect.
(c) Upon submission of written statements and bills in
accordance with the then regular procedures of the Company, Sass shall be
entitled to reimbursement for reasonable out-of-pocket expenses necessarily
incurred in the performance of his duties hereunder, including, but not limited
to, reimbursement for travel and car expenses. A Company credit card will also
be made available to Sass. In addition, Sass shall also be entitled to a car
allowance of $750 per month, plus cost of insurance and maintenance.
(d) During the term of his employment, no other employee of
equal or lesser position/title shall receive greater compensation than Sass, not
including performance based commissions to sales staff.
(e) In the event Xxxxx Xxxxxxxxxx receives a bonus under his
Employment Agreement, then Xxxxxxx Xxxx shall hereunder, be entitled to a bonus
equal to sixty (60%) percent of the bonus granted to Xxxxx Xxxxxxxxxx.
4. Employee Benefits:
(a) Sass shall be included to the extent eligible thereunder
(at the expense of the Company, if appropriate) in any and all existing plans
(and any plans which may be adopted in the
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future) providing benefits for the Company's employees generally, including, but
not limited to, group life and disability insurance, hospitalization, medical,
vacation, retirement, stock option plans and any and all similar or comparable
benefits.
(b) Due to the fact that the Company's success is dependent
upon the activities of Sass, the Company will provide keyman insurance on the
life of Xx. Xxxx in the amount of $1,000,000.00 and Sass will cooperate in
obtaining and maintaining such policy. This policy shall be a "whole life"
insurance policy (the "Policy"). At the termination of this Agreement, for any
reason, the Company shall, at Sass' sole option, assign Sass all of its right,
title and interest in the Policy. At that time, Sass may, at his expense, cause
the Policy to continue in full force and effect and shall have the option to
designate a beneficiary of his choice.
5. Termination:
(a) The Company may terminate Sass's employment hereunder at
any time for cause only by written notice but only after a decision by the Board
of Directors of the Company which is communicated to Sass in writing thirty (30)
days prior to the effective date of termination; provided however, that the
Company pays to Sass a severance payment equal to the aggregate Base Salary
otherwise owed to him over the remaining term of the Employment Period and allow
Sass to retain any options granted under any option plan granted to him
notwithstanding the fact that such options may not be vested and/or exercisable
at the time of termination under this Section 5(a).
(b) For purposes of this Agreement "For Cause" shall mean:
(i) Deliberate misappropriating any funds or properties of the Company;
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(ii) Gross mismanagement of the Company;
(c) In the event Sass dies or becomes disabled so as not to be
able to perform his duties as set forth herein for a period exceeding twelve
(12) moths, this Agreement shall terminate and no further compensation shall be
payable to Sass, except as may otherwise be provided under any insurance policy,
employee benefit plan, or similar instrument; provided however, that during any
such period of disability, Sass shall be entitled to his base salary as provided
under Section 3(a) for a period not to exceed twelve (12) months.
6. Covenant Not to Compete: Sass agrees that, commencing the date hereof and
continuing until the due date of his final payment of salary due hereunder, he
will not, except on behalf of the Company or with the written consent of the
Company (i) engage in any business activity in the United States, directly or
indirectly, on his own behalf or as a partner, stockholder (except by ownership
of less than ten percent (10%) of the outstanding stock of a publicly-held
corporation), director, trustee, principal, agent, employee, consultant or
otherwise of any person, firm or corporation which then is competitive with an
activity in which the Company or any parent or subsidiary of the Company is then
engaged at the time; (ii) allow the use of his name by or in connection with any
business activity which then is principally competitive with any activity in
which the Company or any of its parents or subsidiaries is then engaged; or
(iii) offer employment to or employ, for himself or on behalf of any then
competitor of the Company or any of its parents or subsidiaries, any persons who
at any time within the prior 6 months shall have been employed by the Company or
any parent or subsidiary of the Company. Sass recognizes that as an officer
and/or director of the
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Company, he has a fiduciary duty to reveal to the Company all business
opportunities that he may discover if said opportunities concern technology,
products or business which is related, either directly or indirectly, to the
Company's type of technology, products or business, either at the present or in
the anticipated future. In that event, the Company shall have the first right to
participate in said business opportunity. For the purpose of this section,
"business opportunity" shall include but shall not be limited to, the purchase
of any interest in any business entity which is related to the type of
technology products or business of the Company, by either Sass, any agent of
Sass, or any entity controlled by Sass, its officers, directors, agents,
attorneys, employees, subsidiaries, parents, affiliates, joint venturers,
partners, division, predecessors, and all other persons acting for, purporting
to act for, or subject to, the control of Sass.
7. Default - Remedies: In the event of proof of breach by
Sass, the Company shall be entitled to pursue any remedy at law or equity, and
shall specifically have the right to terminate any further payments of any kind
or nature to be made under this Agreement.
8. Confidential Information: Except as otherwise required by
law, Sass shall not disclose or use at any time, except as part of his
employment by the Company, either during or subsequent to such employment, any
secret or confidential information or knowledge obtained by Sass while employed
by the Company. Without limiting the generality of the foregoing, Sass shall not
disclose or use any information pertaining to the business of the Company or any
parent or subsidiary of the Company, including, but not limited to, profit
figures, names of or relationships with customers or advertisers, or the terms
of any contracts to which it or they may be a party.
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The obligation imposed by this Section 8 shall survive the expiration or other
termination of this Agreement.
9. Surrender of Documents: Sass shall, at the request of the
Company, promptly surrender to the Company or its nominee, upon any termination
of his employment hereunder, or at any time prior thereto, any document,
memorandum, record, letter, specification or other paper in his possession or
under his control relating to the operations, business, customers, or affairs of
the Company or its affiliates.
10. Waiver of Breach: The waiver be either the Company or Sass
of any provision of this Agreement shall not operate or be construed as a waiver
of any subsequent breach by either the Company or Sass.
11. Severability: The invalidity or unenforceability of any
provision of this Agreement, whether in whole or in part, shall not in any way
affect the validity or enforceability of any other part of such provision or of
any provision herein contained, and any invalid or unenforceable provision or
part thereof shall be deemed severable to the extent of any such invalidity or
unenforceability. If such invalidity or unenforceability is due to the
unreasonableness of the time or geographical area covered by the covenants or
restrictions of such provision, such covenants and restrictions shall
nevertheless be effective for such period of time and for such area as may be
determined to be reasonable by a court of competent jurisdiction.
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12. Assignment; Binding Effect: The obligations of Sass
hereunder may not be assigned or delegated without the prior written consent of
the Company. The rights and obligations of the parties shall inure to the
benefit of, and be binding upon, their respective heirs, personal
representatives, successors and assigns.
13. Notices:
(a) All notices, requests, demands, and other communications
hereunder must be in writing and shall be deemed to have been given if delivered
by hand or mailed within the continental United States by first class, certified
mail, return receipt requested, postage and registry fees prepaid, or sent by
telecopier (with receipt confirmation), to the applicable party and addressed as
follows:
(i) if to the Company:
The Harmat Organization, Inc.
X.X. Xxx 000
Xxxxxx, Xxx Xxxx 00000
(ii) if to Sass:
0000 Xxxxxx Xxxxx
Xxxxx Xxxxxxx, 00000
(b) Any notice or other communication given by certified mail
shall be deemed given at the time of certification thereof, except for a notice
changing a party's address which shall be deemed given at the time of receipt
thereof. Any notice or other communication sent by telecopier transmission shall
be deemed given at the time of written confirmation of receipt.
14. Entire Agreement of the Parties: This Agreement expresses
the entire agreement of the parties, and all promises, representations,
understandings, arrangements and
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prior agreements are merged herein and superseded hereby. No person, other than
pursuant to a resolution of the Board, shall have any authority on behalf of the
Company to agree to modify or change this Agreement or anything in reference
thereto, and any such modification or change must be in writing and signed by
both parties hereto.
15. Laws Governing: This Agreement has been entered into in
the State of Florida and shall be construed, interpreted and governed in
accordance with the laws of the State of Florida without regard to the choice of
laws provisions thereof.
16. Counterparts: This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute but one document.
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed by its duly authorized officer, and Sass has hereunto set his hand as
of the day and year first above written.
THE HARMAT ORGANIZATION, INC.
By:
Name: Xxxxxxx Xxxxxxxxxx
Title: President
Accepted and Agreed
By:
Xxxxxxx X. Xxxx
