EXECUTIVE COMPENSATION AGREEMENT
THIS AGREEMENT, made as of this 21st day of September, 1998, by and
between Northeast One Stop, Inc., a New York corporation, having its principal
place of business at 0 Xxxxxxxx Xxxx, Xxxxxx, Xxx Xxxx 00000 (hereinafter "NEOS"
or the "Company") and Xxxxxx X. Xxxxx, an individual residing at 00 Xxxxxxx
Xxxxx, Xxxxxxx Xxxx, Xxx Xxxx 00000 (hereinafter referred to as "Nicks").
W I T N E S S E T H
WHEREAS, it is deemed in the best interest of the Company that Nicks
devote his professional time and energies to the business of the Company;
WHEREAS, the Company seeks to be assured of the continued special
services of Nicks; and Nicks desires to be so employed; and
WHEREAS, the parties desire to set forth in writing their prior
understanding and agreement with respect to such employment;
N O W T H E R E F O R E,
In consideration of the promises and the mutual covenants contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. POSITION.
The Company hereby employs Nicks as the Company's Chief Executive
Officer, in accordance with the powers and duties specified herein, and
generally to be responsible for the day to day management of any executive
decisions concerning the operations of the Company, direct and control its day
to day affairs, make necessary decisions commensurate with his positions in the
Company, be responsible for the operations of the Company and, in general, to
exercise his authority for the best long term interests of the Company and its
shareholders. Duties shall also include primary responsibility for all aspects
of sales, personnel, marketing, management, and operations of the Company, along
with such other duties as may be delegated to him from time to time by the
Company.
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2. TERM.
Effective as of even date, the employment of Nicks shall be for a term
of three (3) years subject to Nicks's good faith performance of the powers and
duties outlined in this Agreement.
3. COMPENSATION.
Nicks shall be paid a salary of $125,000 each year for the term of this
agreement. Said compensation will commence on the effective date of this
agreement as set forth in Paragraph 2 above.
4. BONUS.
Nicks shall participate in the Management Incentive Plan with his bonus
being based upon the revenue and profitability of NEOS, as recorded each year
during the term, as follows: (a) If the Company records net sales or net
revenues (as determined in accordance with Generally Accepted Accounting
Principles ("GAAP"), of at least $50,000,000 but less than $75,000,000, and if
the Company has a pre-tax net profit margin of at least 3.0% (as determined by
GAAP), then Nicks's bonus shall be equal to 15% of the amount such pre-tax net
profit of the entire Company exceeds 3.0%. (b) If the Company records net sales
or net revenues (as determined in accordance with Generally Accepted Accounting
Principles ("GAAP"), in excess of $75,000,000, and if the Company has a pre-tax
net profit margin of at least 4.0%(as determined by GAAP), then Nicks's bonus
shall be equal to the amount as shown in paragraph 4(a) above of the first
75,000,000, plus 20% of the amount the pre-tax net profit of the Company exceeds
4.0% on any amount in excess of $75,000,000. Unless determined otherwise by the
Company's Board of Directors, Nicks's bonus and salary in any given year shall
not exceed $225,000.
5. ADDITIONAL COMPENSATION.
Nicks shall have the right to obtain options to purchase 100,000 shares
of the Common Stock of Planet Entertainment Corporation at an exercise price of
$5.25 per share for a term of two years from the date of issuance. Of these
options, Nicks shall be granted options to purchase 25,000 shares of the Common
Stock of Planet Entertainment Corporation upon execution of this Agreement, and
the remaining options for the purchase of 75,000 shares of Common Stock shall
vest and be issued in equal annual installments upon each annual anniversary of
this Agreement over the next three years. Nothing herein shall prohibit the
Board of Directors from
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granting additional compensation to Nicks in the form of employee stock options
and his salary shall be reviewed annually be the Board concerning appropriate
increases and/or to grant appropriate bonuses for his contributions to the
Company. Under no circumstances shall the compensation be reduced without
Nicks's consent.
6. POWERS AND DUTIES.
Nicks shall be required to devote his professional time, attention and
energies to the business of the Company and particularly as it relates to his
position as Chief Executive Officer, in accordance with the powers and duties
specified herein, and generally to be responsible for the day to day management
of any executive decisions concerning the operations of the Company, direct and
control its day to day affairs, make necessary decisions commensurate with his
positions in the Company, be responsible for the operations of the Company and,
in general, to exercise his authority for the best long term interests of the
Company and its shareholders. Duties shall also include primary responsibility
for all aspects of sales, personnel, marketing, management, and operations of
the Company, along with such other duties as may be delegated to him from time
to time by the Company.
7. COVENANT OF NON-COMPETITION.
In consideration for entering into this Agreement, during the period of
this Agreement, provided the Company is not in material default of any of the
provisions hereof, Nicks shall not, directly or indirectly, engage in any
activity which may be deemed competitive or in any way in conflict with the
Company's business and activities; nor shall he engage in or be a member of any
partnership or as an officer, director or employee of any corporation or
business entity, which competes directly or indirectly with the company without
the express permission of the Board of Directors; nor shall he engage in or be
actively involved in an other consultation or advisory agreements, contracts or
activities of a professional or commercial nature, which would compete directly
or indirectly with the Company unless permitted by the Company and its Board of
Directors for a term of three years in the Continental United States.
8. CONFIDENTIALITY.
Nicks acknowledges that he is in receipt of certain customer names,
identities, addresses, associations, methods, formulations, inventions, sales
and marketing techniques, know-
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how, trade secrets, and other information utilized by the Company, and which
provide, or may provide the Company with a competitive advantage in the
marketplace (the "trade secrets"). Seller agrees to keep these trade secrets
confidential and not to disclose them to any person at any time without the
express written consent of the Company through its Board of Directors.
9. EMPLOYEE BENEFITS.
During the term of Nicks's employment hereunder, the Company shall
provide health, hospitalization, and major medical insurance coverage to Nicks
and his family of the same character and quality as that as made available to
the other executive employees of the Company.
10. TERMINATION.
The Company shall have the right at any time, upon not less than thirty
(30) days written notice to Nicks, to terminate the employment of Nicks for
"Cause." For purposes of this agreement "Cause" shall mean Nicks's arrest or
conviction for a crime of dishonesty, or his failure or refusal in a material
and continuing manner to perform his obligations as set forth in this agreement,
or his material breach of any provision of this Agreement, for a period of more
than twenty (20) days after receipt of written notice from the Company
specifying the failure or breach, requesting that it be cured and Nicks's
failure to cure the same or to be diligently exerting his best efforts to cure
the same. "Cause" shall not include the inability of Nicks to perform his
obligations hereunder due to mental or physical impairment, or external
circumstances of the market place, governmental regulations or policies or
adverse domestic or world conditions adversely effecting the Company's business.
It is agreed that the Company shall not discharge or terminate the services of
Nicks unless there is a material breach of this Agreement supported by a good
faith resolution of the Board of Directors based upon an opinion of Counsel to
the Company specifying in detail the basis for said termination. In the event of
termination for cause, Xx. Xxxxx shall receive his accrued salary as due and
owing as of the time of termination without any accrued bonus or other benefits
as of that date.
11. VACATION.
Nicks shall be entitled to a paid vacation consistent with that of
other executives of the Company. Any and all unused vacation may be carried over
to The succeeding year(s).
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12. STOCK OPTION.
Nicks shall have the right to participate in the Company's
non-qualified stock option plan, or any subsequent stock option plan adopted by
the Company.
13. STOCK SPLITS AND DIVIDENDS.
Should the stock of the company split or a stock dividend be paid for
any reason during the term of this Agreement, any unexercised stock option or
warrant, or portion thereof, shall be deemed to be subject to the terms of the
stock split or purchase the equivalent number of shares covered by the split as
if he had previously owned or received his option prior to the stock split.
14. REPRESENTATION ON THE BOARD OF DIRECTORS
Planet Entertainment Corporation agrees to nominate Nicks to the Board
of Directors, subject to a majority vote by the shareholders of Planet
Entertainment as required by the By-Laws of Planet Entertainment Corporation and
the laws of the State of Florida.
15. NOTICES.
All notices and other communications required hereunder shall be in
writing and shall be deemed to have ben duly given if delivered or mailed
(registered or certified mail, postage prepaid, return receipt requested), if to
Nicks, to his residence, and if to the Company to its principal office.
16. WAIVER.
No waiver of any provision of this Agreement shall be deemed or shall
constitute a waiver of any other provision. No waiver shall be effective unless
executed in writing by the parties hereto.
17. LAW GOVERNING.
This Agreement shall be construed and governed in accordance with the
laws of the State of New York.
18. ENTIRE AGREEMENT.
This Agreement contains the entire understanding of the parties and may
not be modified, amended or supplemented, except by the written agreement of the
parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the
day and year first above written.
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NORTHEAST ONE STOP, INC.
BY: /s/ XXXXX X. XXXXXXXXXX
-----------------------
NAME: Xxxxx X. XxxXxxxxxx
TITLE: Chairman
DATE: 9/24/98
PLANET ENTERTAINMENT CORPORATION
BY: /s/ XXXXXXX X. GIAKIS
----------------------
NAME: Xxxxxxx X. Giakis
TITLE: Chairman
DATE: 9/24/98
XXXXXX X. XXXXX
BY: /s/ XXXXXX X. XXXXX
--------------------
DATE: 9/21/98
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ADDENDUM
EXECUTIVE COMPENSATION AGREEMENT
THIS AGREEMENT, made as of this 21st day of September, 1998, by and
between Northeast One Stop, Inc., a New York corporation, having its principal
place of business at 0 Xxxxxxxx Xxxx, Xxxxxx, Xxx Xxxx 00000 (herein after
"NEOS"), Planet Entertainment Corporation ("Planet" or the "Company") and Xxxxxx
X. Xxxxx, an individual residing at 00 Xxxxxxx Xxxxx, Xxxxxxx Xxxx, Xxx Xxxx
00000 (hereinafter referred to as "Nicks").
1. Xxx Xxxxx as part of his executive compensation, shall receive
options to purchase an additional 50,000 shares of the
Company's common stock at $5.25 per share exercisable for two
years vesting immediately, thereby granting Nicks total
options to acquire 150,000 shares of the Company's common
stock pursuant to his employment agreement.
NORTHEAST ONE STOP, INC.
BY: /s/ XXXXX X. XXXXXXXXXX
------------------------
NAME: Xxxxx X. XxxXxxxxxx
TITLE: Chairman
DATE: 9/24/98
PLANET ENTERTAINMENT CORPORATION
BY: /s/ XXXXXXX X. GIAKIS
----------------------
NAME: Xxxxxxx X. Giakis
TITLE: Chairman
DATE: 9/24/98
XXXXXX X. XXXXX
BY: /s/ XXXXXX X. XXXXX
--------------------
DATE: 9/21/98
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