Employment Agreement for Executive
THIS EMPLOYMENT AGREEMENT (this "Agreement"), dated as of __________________ (the "Effective Date"), is entered into by and between <> a <>corporation (the "Company"), and <> (the "Executive").
W I T N E S S E T H:
WHEREAS, in recognition of the Executive's experience and abilities with the Company, the Company desires to employ the Executive from and after the date hereof in accordance with the terms and conditions provided herein;
WHEREAS, simultaneously herewith, the Executive and the Company are entering into that certain Share Purchase Agreement , if any.; and
WHEREAS, the Executive wishes to perform services for the Company in accordance with the terms and conditions provided herein.
NOW, THEREFORE, in consideration of the premises and the respective covenants and agreements of the parties herein contained, and intending to be legally bound hereby, the parties hereto agree as follows:
- Term. This Agreement shall be for the approximatelythree-year period (the "Term") commencing as of the date hereof and terminating (a) on <> or (b) upon the Executive's earlier death, Disability (as defined in Section 7(b) hereof), or (c) other termination of employment pursuant to Section 7 hereof. At the end of the Term, the Company may, acting pursuant to the direction of the Board of Directors of the Company (the "Board"), consider further extending the Term upon terms and conditions mutually acceptable to the Company and the Executive. The obligations of the Company and the Executive under this Agreement which by their nature may require either partial or total performance after the expiration of the Term shall survive such expiration.
- Employment. The Company hereby agrees to employ the Executive, and the Executive hereby agrees to perform services for the Company and its subsidiaries, if any, on the terms and conditions set forth herein. Any prior employment or severance agreement between the Company and the Executive shall be deemed terminated and shall be null and void and of no further force and effect.
- Position. During the Term, the Executive shall serve as the President of the Company, which shall be the highest ranking officer of the Company. The Executive shall report directly to the Board of Directors of the Company (the “Board”). Simultaneously with the execution of this Agreement, the shareholder of the Company is appointing the Executive to serve on the Board.
- Duties and Reporting Relationship. During the Term, the Executive shall, on a full time basis, use his skills and render services to the best of his abilities in contributing to the operations and growth of the Company, all in accordance with the directives of the Board, and shall not engage in any other business activities, as an employee, director, consultant or in any other capacity, whether or not he receives any compensation therefor, without the prior written consent of the Board; provided, however, that the Executive may continue to engage in his humidor business and real estate ventures without such consent and provided that these ventures do not interfere with his duties under this Agreement.
- Place of Performance. The Executive shall perform his duties and conduct his business at the offices of the Company, located in <>, or within a fifty (50) mile radius thereof, except for reasonably required travel on the Company's business.
(a) Annual Base Salary. During the Term, the Company shall pay to the Executive an annual base salary (as it may be adjusted from time to time, the "Base Salary") at a rate of not less thanone hundred thousand dollars ($100,000). Such salary shall be payable in substantially equal installments at least twice per month.
(b) Bonus and Incentive Plans. During the Term, the Executive shall be entitled to participate in incentive, bonus and other executive compensation plans, programs and arrangements (the "Incentive Plans") of the Company as in effect from time to time. The Executive would have bonus opportunities of:
(i) An annual bonus of 10% of the Operating Income (as defined below) of the Company in incentives consisting of cash, provided the Operating Income is a positive number; and
(ii) Subject to the approval of the Board, for the period commencing <>, an annual bonus of up to 20% of Base Salary in incentives consisting of restricted stock of PPL Corporation, which shall be determined at the discretion of the Board and based on written criteria provided to the Executive on an annual basis.
For purposes of this Agreement, "Operating Income" shall mean the operating income of the Company as set forth in the Company’s audited income statement (the "Operating Income"), before goodwill amortization, income taxes, interest and charges related to overhead costs of the Company which include those charges specifically allocated to the Company pursuant to internal expense accounting practices as set forth on itemized bills to the Company, all of which are to be determined in accordance with GAAP applied on a consistent basis.
(c) Vehicle Allowance. During the Term, the Company shall provide the Executive with a monthly vehicle allowance of $650 plus reimbursement for fuel used for Company business.
(d) During the Term, the Company shall provide to the Executive the standard retirement, welfare and other fringe benefits normally provided by the Company to its executives from time to time, which benefits shall be no less favorable than those identified on Exhibit A hereto.
- Termination. The Executive's employment hereunder may be terminated only under the following circumstances:
(a) Death. The Executive's employment hereunder shall terminate upon his death.
(b) Disability. If, as a result of the Executive's incapacity due to physical or mental illness, the Executive shall have been absent from his duties hereunder for the entire period of six consecutive months, and within thirty (30) days after written notice of termination is given by the Company (which notice may be given immediately after such six month period), shall not have returned to the performance of his duties hereunder, the Company may terminate the Executive's employment hereunder for "Disability."
(c) Cause. For purposes of this Agreement, the Company shall have "Cause" to terminate the Executive's employment hereunder under any of the following circumstances:
(i) the Executive pleads guilty or is found guilty by a court of having committed fraud or theft against the Company or its subsidiaries or having committed a felony;
(ii) the Executive pleads guilty or is found guilty by a court of having committed a crime involving moral turpitude;
(iii) in the reasonable judgment of the Board, the Executive has compromised trade secrets or other proprietary information of the Company or its subsidiaries;
(iv) in the reasonable judgment of the Board, the Executive shall have breached in any material respect the terms of this Agreement; or
(v) in the reasonable judgment of the Board, the Executive engaged in gross or willful misconduct that causes material harm to the business, operations or prospects of the Company or its subsidiaries or any affiliate thereof.
No act or failure to act on the part of the Executive shall be considered "willful" unless it is done, or omitted to be done, by the Executive in bad faith or without reasonable belief, based on the Executive's reasonable business judgment, that the Executive's action or omission was in the best interests of the Company and its subsidiaries. Any act or failure to act that is based upon authority given pursuant to a resolution duly adopted by the Board, or upon the legal advice of counsel for the Company, shall be conclusively presumed to be done, or omitted to be done, by the Executive in good faith and in the best interests of the Company and its subsidiaries. The Executive will be given written notice of any occurrence which the Company believes may constitute Cause under subsections (iii), (iv) and (v) of this paragraph and will be provided a reasonable opportunity to discuss such occurrence and, to the extent reasonably curable, to cure such occurrence, prior to a final determination by the Board.
(d) Termination by the Executive. The Executive may terminate his employment hereunder for "Good Reason", provided, however, that the Executive will give written notice to the Board of any occurrence which the Executive believes may constitute Good Reason under this Agreement and the Board will be provided a reasonable opportunity to discuss such occurrence and, to the extent reasonably curable, to cure such occurrence. "Good Reason" for termination by the Executive of the Executive's employment shall mean the occurrence (without the Executive's consent) of any one of the following acts by the Company, or failures by the Company to act:
(i) a reduction in the Base Salary during the term of this Agreement, unless (x) such reduction is due to the Executive's continued failure after notice to adequately perform his duties or (y) such reduction is commensurate with a company-wide (i.e., all affiliates) reduction of salary;
(ii) the Company's relocation of the Executive out of the Company's principal executive offices, except for required travel on the Company's behalf to the extent reasonably necessary for the Executive to carry out his normal duties in the ordinary course of business, or the relocation of the Company's principal executive offices to a location more than fifty (50) miles from their location as of the date hereof; or
(iii) a material reduction in the duties or responsibilities of the Executive.
(e) Date of Termination. "Date of Termination" shall mean
(i) if the Executive's employment is terminated by his death, the date of his death,
(ii) if the Executive's employment is terminated pursuant to paragraph (b) above, thirty (30) days after written notice of termination is given (provided that the Executive shall not have returned to the performance of his duties on a full-time basis during such thirty (30)-day period), and
(iii) if the Executive's employment is terminated pursuant to paragraph (c) or (d) above, the date specified in the written notice of termination.
- Compensation Upon Termination or During Disability.
(a) Disability or Death. During any period in which the Executive fails to perform his duties hereunder as a result of incapacity due to physical or mental illness, the Executive shall continue to receive his full Base Salary, as well as other applicable executive benefits, until his employment is terminated pursuant to Section 7(b) hereof;provided, however, that any Base Salary payable to the Executive during such period of incapacity shall be reduced by an amount equal to any payment which the Executive may be entitled to receive under any disability plan or policy of the Company that is in effect at the time. In the event the Executive's employment is terminated pursuant to Section 7(a) or 7(b) hereof, then, as soon as practicable thereafter, the Company shall pay the Executive or the Executive's beneficiary or, if none, his estate, as the case may be, all unpaid amounts, if any, to which the Executive was entitled as of the Date of Termination under Section 6(a) hereof (the "Accrued Salary").
(b) Termination for Cause; Voluntary Termination Without Good Reason. If the Executive's employment is terminated by the Company for Cause or by the Executive other than for Good Reason, then the Company shall pay the Accrued Salary within ten (10) days after the Date of Termination, and the Company shall have no further obligations to the Executive under this Agreement.
(c) Voluntary Termination for Good Reason or Involuntary Termination Other Than for Cause. If the Executive's employment is terminated by the Executive for Good Reason, or is terminated by the Company other than for Cause, then upon such termination the Company shall pay to the Executive the Accrued Salary, plus an aggregate lump sum amount, in cash, equal to the present value, discounted using an interest rate equal to theWall Street Journal Prime Rate or its successor, and in effect as of the Date of Termination, of
(i) the Base Salary through the end of the Term plus
(ii) a cash bonus for each anniversary remaining in the Term equal to the cash bonus awarded to the Executive in the year preceding the Executive's termination; provided, however, if the Executive is terminated in year one, then the cash bonus for each remaining year shall be equal to the cash bonus that the Executive would have received (if any) under Section 6(b)(i) in year one.
The Company shall continue to provide to the Executive (and his eligible beneficiaries) the Company-paid welfare benefits (including life insurance) to which the Executive would have been entitled had he remained employed by the Company pursuant to this Agreement through the end of the Term; provided, however, that to the extent the Executive receives or is entitled to receive such welfare benefits from another source(other than a source not made available through the Company and for which the Executive personally pays the premiums, such as privately contracted disability insurance), the Company shall not also be required to provide such benefits. Upon payment of the foregoing amounts, the Company shall have no further obligations to the Executive.
- Covenant Not to Compete; Non-Disclosure.
(a) The Executive hereby agrees that, during the Term and for a period of eighteen months (the "Restricted Period") following the termination of this Agreement (other than a termination of the Executive's employment (x) by the Executive for Good Reason, or (y) by the Company other than for Cause), the Executive:
(i) shall not, directly or indirectly, whether acting individually or through any person, firm, corporation, business or any other entity, engage in, or have any interest in any person, firm, corporation, business or other entity (as an officer, director, employee, agent, stockholder or other security holder, creditor, consultant or otherwise) that engages in any business activity where any aspect of the business of the Company or its subsidiaries is conducted, or planned to be conducted, anywhere within the State of _________ and the states contiguous thereto in which any of the Affected Companies (as defined below) has conducted business in the preceding twelve months, at any time during the Restricted Period, which business activity is the same as, similar to or competitive with business activities involving the provision of services by any line of business conducted by the Company or its subsidiaries (the "Affected Businesses") as the same may be conducted from time to time;
(ii) shall not, directly or indirectly, whether acting individually or through any person, firm, corporation, business or any other entity, interfere with any contractual relationship of any company that is a subsidiary or affiliate of the Company and is involved in the Affected Businesses (the "Affected Companies") that may exist from time to time, including, but not limited to, any contractual relationship with any director, officer, employee, or sales agent, or supplier of the Affected Companies; and
(iii) shall not, directly or indirectly, whether acting individually or through any person, firm, corporation, business or any other entity, solicit, induce or influence, or seek to induce or influence, any person who currently is, or from time to time may be, engaged or employed by the Affected Companies (as an officer, director, employee, agent or independent contractor) to terminate his or her employment or engagement by the Affected Companies.
(b) The Executive shall respect and protect the confidentiality of all confidential and proprietary information pertaining to the Affected Companies, and shall not without the prior written consent of the Company, disclose in any fashion such information to any person at any time (whether during or after his employment with the Company) unless required in the course of the Executive's employment hereunder or required by applicable law, rules, regulations or court, governmental or regulatory authority, order or decree. Upon the termination of his employment with the Company for any reason, the Executive shall return to the Company immediately all memoranda, books, papers, plans, information, letters and other data, and all copies thereof or therefrom, in any way relating to the business of the Affected Companies.
(c) Notwithstanding anything to the contrary contained herein, the Executive, directly or indirectly, may own publicly-traded stock constituting not more than two percent (2%) of the outstanding shares of such class of stock of any corporation that is a competitor with the Affected Businesses if, and as long as, the Executive is not an officer, director, employee or agent of, or consultant or advisor to, or has any other relationship or agreement with such corporation.
(d) If the Executive materially breaches any of the provisions of this Section 9 (the "Restrictive Covenants"), the Company shall have the following rights and remedies, each of which rights and remedies shall be independent of the other and severally enforceable, and all of which rights and remedies shall be in addition to, and not in lieu of, any other rights and remedies available to the Company under law or equity:
(i) the right and remedy to have the Restrictive Covenants specifically enforced by any court having equity jurisdiction, it being acknowledged and agreed that any such breach or threatened breach will cause irreparable injury to the Company and that money damages will not provide an adequate remedy to the Company; and
(ii) the right to discontinue the payment of amounts or benefits (if any) owing to the Executive under this Agreement.
(e) The Executive acknowledges that the non-competition provisions contained in this Agreement are reasonable and necessary, in view of the nature of the Affected Businesses and his knowledge thereof, in order to protect the legitimate interests of the Affected Companies.
- Confidentiality. Neither the Company nor the Executive shall disclose the terms of this Agreement to any person without the prior written consent of the other party, such consent not to be unreasonably withheld;provided, however, that no such consent shall be required in connection with such party's or its affiliates' (i) obligation to disclose any such information pursuant to applicable laws or rules and regulations of the Securities and Exchange Commission or a national securities exchange or pursuant to a subpoena or other legal process, (ii) right to disclose any such information to its affiliates, auditors, counsel, lenders, and other professional advisors, (iii) right to disclose any such information to potential purchasers of the Company or its affiliates, or of their securities, and representatives of such potential purchasers and (iv) right to disclose any such information in connection with any litigation or dispute involving the Executive or the Company.
- Binding Agreement. This Agreement and all rights of the Executive hereunder shall inure to the benefit of and be enforceable by the Executive's personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees.
- Indemnification. The Company shall continue to provide indemnification for the Executive on terms no less favorable than is provided by the By-Laws of the Company on the date hereof, to the extent such terms are permitted by law.
- Notice. For the purposes of this Agreement, notices, demands and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given when delivered or (unless otherwise specified) by reputable overnight carrier or mailed by United States certified or registered mail, return receipt requested, postage prepaid, addressed as follows:
If to the Company:
With a copy to:
If to the Executive:
or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notices of change of address shall be effective only upon receipt.
(a) No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing signed by the Executive and such officer of the Company as may be specifically designated by the Board. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not set forth expressly in this Agreement.
(b) If any one or more of the provisions contained in this Agreement is held to be excessively broad as to duration, scope, activity or subject, such provisions shall be construed by limiting and reducing them so as to be enforceable to the maximum extent compatible with applicable law.
- Governing Law; Interpretation. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of<> without regard to its conflicts of law principles. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect.
- Withholding; Payment. Notwithstanding any other provision of this Agreement, the Company may withhold from amounts payable under this Agreement all federal, state, local, and foreign taxes that are required to be withheld by applicable laws or regulations.
- Validity. The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.
- Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.
- Entire Agreement. This Agreement sets forth the entire agreement of the parties hereto in respect of the subject matter contained herein and supersedes any and all other prior agreements, promises, covenants, arrangements, communications, representations or warranties, whether oral or written, by any officer, employee or representative of any party hereto.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date and year first above written.