EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is made as of the 15th day of
November, 1999, by and between GLOBAL SOURCES LIMITED, INC., a Delaware
corporation with an office for the conduct of its business at 000 Xxxxxxx
Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000 (the "Company"), and XXXX XXXXXX,
an individual residing at 00 Xxxxxxx Xx., Xxxxxx, XX (the "Executive").
WHEREAS, the Company desires to employ the Executive as the President of
E.P. INTERNATIONAL INC. ("EPI") from and after the date of its acquisition by
the Company, and the Executive desires to be employed by EPI in such capacity;
and
WHEREAS, the parties hereto desire to enter into an agreement of employment
mutually beneficial to said parties, and for the purpose of defining the rights,
duties and obligations of each of the parties hereto;
NOW THEREFORE, for good and valuable consideration, the sufficiency and
receipt of which is hereby acknowledged, the Company and the Executive agree as
follows:
1. Employment. Upon the terms and subject to the conditions of this
Agreement, the Company hereby agrees to cause EPI to employ the Executive and
the Executive hereby accepts employment by EPI on the terms and conditions
hereinafter set forth.
2. Term. Subject to the provision of Section 10 of this Agreement,
Executive's employment shall be for a period of five (5) years commencing on
__________, 1999 and terminating on ____________, 2004.
3. Executive's Position, Duties and Authority.
3.1 Position. The Company shall cause EPI to employ the Executive, and
the Executive shall serve as the President of EPI.
3.2 Description. The Executive shall perform such duties and
responsibilities on a full time basis as shall be reasonably assigned to the
Executive by the President and Chief Executive Officer of the Company, and which
are customarily incident to the day-to-day management and operation of EPI or
the offices of President, including, but not limited to performing various
administrative duties as shall be reasonably assigned to the Executive by the
President and Chief Executive Officer of the Company.
3.3 Authority. At all times during the Term, the Executive shall
report directly to the Chairman and Chief Executive Officer of the Company, or
to such other senior executive as the Chairman and Chief Executive Officer of
the Company may designate.
4. Full-Time Services.
4.1 General. The Executive shall devote substantially all of his
business time, labor, skill and energy to the business and affairs of EPI and
the Company and to the duties and responsibilities referred to in Section 3.2 of
this Agreement.
4.2 Opportunities; Investments. The Executive covenants and agrees
that, during the Term, he shall inform the Company of each business opportunity
related to the business of the Company or any of the Company's subsidiaries or
affiliates of which he becomes aware and that he will not, directly or
indirectly, exploit any such opportunity for his own account, nor will he render
any services to any other person or business, or acquire any interest
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of any type in any other business, that competes with any business of the
Company or any of the Company's subsidiaries or affiliates.
5. Location of Employment. Unless the Executive consents otherwise in
writing, the principal location for the performance of his duties hereunder
shall be at the Company's offices in New York City or Parsippany, NJ or EPI's
offices in Verona, New Jersey.
6. Base Salary/Bonuses.
6.1 Base Salary. The Company shall, commencing November 15, 1999 and
during the continuance of the Executive's employment hereunder, pay to the
Executive, and the Executive agrees to accept, in consideration of his services,
a salary (the "Base Salary") at a rate of TEN THOUSAND DOLLARS ($10,000) per
month. All Base Salary shall be payable in accordance with the Company's normal
payroll practices, so long as the Executive's employment continues as provided
by this Agreement.
6.2 Bonuses. During the Term of this Agreement, the Executive shall be
eligible to receive the following bonus payments (each a "Bonus," and
collectively, the "Bonuses"):
(a) An annual (calendar year) bonus, payable at the discretion of the
Board of Directors, of no less than 15 percent of the increase, if any, in
pre-tax profits of EPI; and
(b) A bonus equal to 2 percent of the purchase price of any
acquisition of another human resource company made by the Company or one of its
affiliates ("Acquisition Price") that was originated or introduced by the
Executive, payable at the time of the closing of the acquisition;
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(c) A bonus of 1/2 of 1 percent of the Acquisition Price of another
human resource company acquired by the Company or one of its affiliates that was
introduced by a person ("Finder") who was referred by Executive, provided,
however, that the Company and its affiliates will not pay more than 2.5 percent
of the Acquisition Price to the Finder for such services, payable in each case
at the time of the closing of the acquisition.
(d) Calculation of pre-tax profits shall be made in good faith by the
Company's Chief Financial Officer consistent with the Company's usual and
customary practice.
7. Stock Options. On the date of commencement of Executive's employment
with EPI hereunder, the Executive shall be eligible to receive the following
options (collectively, the "Stock Options") to purchase shares of the Company's
Common Stock as provided below:
Stock Options, to be issued January 5, 2000, to acquire 25,000
shares, as adjusted for any stock splits, stock dividends or
similar events occurring after the date hereof, of the Common
Stock of the Company, at a price equal to the market of the
Company's Common Stock as of twenty (20) days after becoming a
public company with registered Common Stock.
The Stock Options shall fully vest on the date of their issuance to the
Executive, shall not be transferable except upon the optionee's death, shall,
unless terminated, be exercisable for 10 years from the date of issuance, shall
be subject to early termination upon cessation of employment with the Company as
set forth in greater detail in Exhibit A hereto, and shall be subject to such
other terms and conditions applicable to stock options of the Company pursuant
to the Company's stock option plan.
8. Expenses; Vacation. The Company shall reimburse the Executive in
accordance with the Company's regular procedures in effect from time to time and
in form suitable to establish the validity of such expenses for tax purposes,
all ordinary, reasonable and necessary
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travel, entertainment and other business expenses as shall be incurred by him in
the performance of his duties hereunder. During the Term of this Agreement, the
Executive shall be entitled to twenty (20) days vacation annually with pay.
9. Benefits. During the Term, the Executive shall be eligible to
participate in any pension or profit-sharing plan or program of the Company now
existing or hereafter established, on terms no less favorable than those made
available to other senior executives of the Company. Upon meeting all applicable
eligibility requirements, the Executive shall be entitled to receive such other
benefits or rights as may be provided under any employment benefit plan provided
by the Company that is now or hereafter will be reflected, including
participation in life insurance and disability plans but excluding medical and
dental insurance.
10. Termination.
10.1 Notwithstanding the provisions of Sections 1 and 2 hereof, this
Agreement may be terminated prior to the expiration of the Term by the President
and Chief Executive Officer of the Company upon the occurrence of any of the
following events:
10.1.1 Upon the death of the Executive;
10.1.2 Upon the inability of the Executive to perform his duties
in any material respects on account of illness or other incapacity for the
longer of (i) three (3) months in any period of 12 consecutive months or (ii)
any longer period prescribed by any applicable law;
(a) the Executive is convicted of a felony criminal offense, or
of a criminal offense involving any act or acts or moral turpitude;
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(b) The Executive is found guilty of any act of dishonesty, fraud
or theft from the Company, or any of the Company's subsidiaries or affiliates;
(c) In the event of willful malfeasance, gross negligence, or
gross or willful material misconduct in the performance of his duties hereunder;
or
(d) Upon the failure or refusal by the Executive to perform
according to or to comply with the reasonable policies and directions
established by the Company after written notice of such non-compliance stating
what is required of the Executive to cure such non-compliance and a reasonable
opportunity to cure such non-compliance within ten (10) business days of
delivery of such notice.
11. Noncompetition.
11.1 The Executive shall be prohibited from disclosing to anyone
(except to the extent reasonably necessary to perform the Executive's duties
hereunder) any confidential information concerning the business or affairs of
the Company or the Company's subsidiaries or affiliates which the Executive may
have acquired in the course of and as incident to this employment or prior
dealings with the Company or the Company's subsidiaries or affiliates,
including, without limitation, client lists, business or trade secrets, or
methods or techniques used by the Company or the Company's subsidiaries or
affiliates in or about its business. The obligation in this subsection 11.1
survives the expiration or earlier termination of this Agreement.
11.2 During the Term of this Agreement and for a period of twenty four
(24) months after the expiration or earlier termination hereof, the Executive
will not:
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(a) compete with the Company for business with customers and/or
clients that are or have been clients or customers of the Company or its
subsidiaries within the four (4) months preceding the date the Executive leaves
the Company; or
(b) influence or attempt to influence any employee of the Company or
the Company's subsidiaries or affiliates to terminate his or her employment with
the Company or the Company's subsidiaries or affiliates.
The obligation in this subsection 11.2 survives the expiration or earlier
termination of this Agreement. In the event that the restrictive period provided
in this Section 11.2 is determined to be too long by any court or other body
having jurisdiction over any dispute between the parties over such issue whose
decision is binding on the parties hereto, this Section 11.2 shall be valid and
enforceable for the period determined to be so enforceable.
12. Notices. Any notice, direction or instruction required or permitted to
be given hereunder shall be given in writing and may be given by telex,
telegram, facsimile transmission or similar mail if confirmed by mail as herein
provided; by mail if sent postage prepaid by registered mail, return receipt
requested; or by hand delivery to any party at the address of the party set
forth below. If notice, direction or instruction is given by telex, telegram or
facsimile transmission or similar method or by hand delivery, it shall be deemed
to have been given or made on the day on which it was given, and if mailed,
shall be deemed to have been given or made on the third business day following
the day after which it was mailed. Any party may, from time to time, by like
notice give notice of any change of address and in such event, the address of
such party shall be deemed to be changed accordingly.
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(a) If to the Company:
Global Sources Limited, Inc.
000 Xxxxxxx Xxxxxx, Xxxxx 0000
Attention: Xxx Xxxxxx
Attention:
With a copy to:
Xxxxxx Xxxxxxxxx, Esq.
Xxxxxx & Xxxxx LLP
000 Xxxxx Xxx, 00xx Xxxxx
Xxx Xxxx, X.X. 00000
(b) If to the Executive:
Xxxx Xxxxxx
E.P. International Inc.
00 Xxxxxxx Xxxx
Xxxxxx, Xxx Xxxxxx 00000
With a copy to:
13. General.
13.1 Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the internal laws of the State of New York,
regardless of the laws that might otherwise govern under applicable principles
of conflicts of laws.
13.2 Entire Agreement. This Agreement sets forth the entire agreement
and understanding of the parties relating to the subject matter hereof, and
supersedes all prior agreements, arrangements and understandings, written or
oral, between or among the parties, except as specifically provided herein.
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13.3 Successors and Assigns. This Agreement, and the Executive's
rights and obligations hereunder, may not be assigned by the Executive, except
that the Executive may designate one or more beneficiaries to receive any
amounts that would otherwise be payable hereunder to the Executive's estate.
This Agreement shall be binding on any successor to the Company whether by
merger, consolidation, acquisition of all or substantially all of the Company's
assets or business or otherwise, as fully as if such successor were a signatory
hereto; and the Company shall cause such successor to, and such successor shall,
expressly assume the Company's obligations hereunder.
13.4 Amendments; Waivers. This Agreement cannot be changed, modified
or amended, and no provision or requirement hereof may be waived, without
consent in writing of the parties hereto. However, in the event that the Company
issues an Employee Manual which amends or modifies any policy specifically
identified and incorporated into this Agreement, such policy automatically shall
be deemed included as part of this Agreement without further consideration other
than the continued performance of this Agreement's material terms by the
Company.
13.5 Ability to Fulfill Obligations. Neither the Company nor the
Executive is a party to or bound by any agreement which would be violated by the
terms of this Agreement.
13.6 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original. It shall not be
necessary when making proof of this Agreement to account for more than one
counterpart.
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EXHIBIT A
Early Termination of Stock Options
1. Should Optionee cease service for any reason other than death or
permanent disability while the option remains outstanding, then Optionee will
have a three (3) month period measured from the date of such cessation of
Service in which to exercise the option for any or all of the option shares for
which the option is exercisable at the time of such cessation of Service. In no
event, however, may the option be exercised at any time after the specified
expiration date of the option term. Upon the expiration of such three (3) month
period or (if earlier) upon the specified expiration date of the option term,
the option will terminate and cease to be outstanding.
2. Should Optionee die while in service or within the three (3) month
period following his or her cessation of service, then the personal
representative of Optionee's estate or the person or persons to whom the option
is exercisable at the time of Optionee's cessation of service, less any option
shares subsequently purchased by Optionee prior to death. Such right will lapse,
and the option will terminate and cease to remain outstanding, upon the earlier
of (i) the expiration of the twelve (12) month period measured from the date of
Optionee's death or (ii) the expiration date.
3. Should (i) Optionee's service be terminated for misconduct (including,
but not limited to, any act of dishonesty, willful misconduct, fraud or
embezzlement) or (iii) Optionee make any unauthorized use or disclosure of
confidential information or trade secrets of the
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Company or any parent or subsidiary, then in any such event the option will
terminate immediately and cease to be outstanding.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as
of the date first above written.
GLOBAL SOURCES LIMITED, INC.
By: /s/ Xxxxx X. Xxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxx
Title: Chairman
EXECUTIVE:
/s/ Xxxx Xxxxxx
-----------------------------------
Xxxx Xxxxxx
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