Exhibit 10.16
EMPLOYMENT AGREEMENT
This employment agreement ("Agreement") dated as of the 11th day of
August, 1999, between Universal Heights, Inc., a corporation organized and
existing under and by virtue of the laws of the State of Delaware, having its
principal place of business at ▇▇▇▇ ▇.▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "Company"), and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, who resides at ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Employee").
W I T N E S E T H:
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WHEREAS, the Company is engaged in the investment and financial
services industry; and
WHEREAS, the Company is desirous of continuing to employ Employee to
develop and run its investment and financial services activities, and Employee
is desirous of continuing in such capacity; and
WHEREAS, the Company and Employee desire to enter into this
Agreement so that the rights, duties, benefits and obligations of each in
respect of the employment of Employee for and by the Company will be fully set
forth under the terms and conditions stated herein upon the execution hereof;
and
WHEREAS, the Board of Directors of the Company have approved the
employment of Employee upon the terms and conditions set forth herein by a
resolution issued by it, and have authorized the execution and delivery of this
Agreement.
NOW, therefore, in consideration of the mutual promises contained
herein, including the extension of Employee's term of employment, and for other
good and valuable consideration, the Company and Employee agree as follows:
1. EMPLOYMENT
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The Company hereby employs Employee in an Employee capacity,
specifically as "President" and as the Company's "Chief Employee Officer."
Employee hereby accepts such employment and agrees to perform the services and
duties specified herein.
2. TERM
----
Subject to the terms and conditions herein, the term of the
employment of Employee under this Agreement ("Term") is effective as of January
1, 1999 (the "Effective Date") and shall terminate on December 31, 2003, unless
extended in accordance with this section or by written instrument executed by
the Company after review and approval of such extension by the Board of
Directors of the Company ("Expiration Date"). On the first anniversary of the
Effective Date and on each subsequent anniversary date, the term of this
Agreement shall be extended automatically for one (1) additional year unless one
party provides written notice to the other no less than sixty (60) days prior to
any such anniversary of the Effective Date that it does not wish to extend the
term of this Agreement; in which event there shall be no extension of the Term
on the anniversary date next following timely delivery of such written notice.
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3. DISABILITY
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If, during the Term, Employee shall become unable to perform his
duties as provided for herein by reason of illness or injury, for a consecutive
period of three hundred sixty five (365) days, then the Company may, on thirty
(30) days written notice to Employee, terminate the officership held by
Employee. In the event of such termination, Employee shall remain an employee of
the Company and receive seventy (70%) percent of his compensation and all of his
fringe benefits as set forth below in Articles 6 and 8, respectively.
4. TERMINATION FOR CAUSE
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This Agreement may be immediately terminated by the Company for
"cause" at any time, upon written notice to Employee, after which all
obligations of the Company to Employee shall thereupon cease. For the purposes
of this Agreement, the term "cause" when used with reference to the termination
of this Agreement, shall mean only any or all of the following:
(a) Employee's absence from his employment for any reason
other than sickness or injury, at substantially all times during a period of
ninety (90) consecutive days;
(b) Failure on the part of Employee to (i) follow material
instructions or policy of the Board of Directors given or adopted in good faith,
or (ii) carry out an agreed policy or course of action as determined by (a) the
Board of Directors or (b) a committee of the Board of Directors, any or all of
which is or may be to the detriment of the Company; or
(c) Willful misconduct or gross negligence of Employee in
connection with the performance of his duties.
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5. DUTIES
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(a) Employee shall perform the following duties in connection
with his employment, all of which shall be subject to the paramount directions
of the Board of Directors:
(i) To serve as "President" and to be the "Chief
Employee Officer" of the Company; and
(ii) To assist the Company in its business affairs and
develop and
run its investment and financial services activities, as well as in the
Company's dealings with other companies, its regulatory affairs, banking and
other financial institutions and other groups and institutions; and
(iii) To undertake such specific assignments, consistent
with his office and position, as may be given to him from time to time by the
Board of Directors; and
(iv) To continue to serve as a director of the Company,
and then
as, if and when re-elected, to continue to serve as a director of the Company,
and also if so elected, to serve as a director of any subsidiary or affiliate of
the Company.
(b) Employee shall devote his best efforts and skills to the
affairs of the Company, and to the performance of the duties set forth in this
Article 5, on a substantially full-time basis. Employee shall not participate in
any outside business activity that will either (i) interfere with, or (ii) be a
conflict of interest with the performance of Employee's duties, activities and
employment pursuant to this Agreement. The foregoing notwithstanding, Employee
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has disclosed to the Company his other outside business interests ("Outside
Business Interests") which are listed on Schedule "1" hereto and the Company
with this full knowledge has consented to Employee's continuance thereof.
Moreover, the Company agrees to permit Employee to involve himself in other
similar Outside Business Interests, on condition that they similarly be
disclosed and are added to Schedule "1" prior to their being commenced. Employee
may also invest his assets and manage, protect and support the profitability of
such assets, as well as devote such reasonable time as is required by such
Outside Business Interests, subject to the limitations set forth in this Section
5(b).
6. COMPENSATION
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(a) BASE SALARY
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Employee shall receive from the Company, or any of its
subsidiaries, for the discharge of Employee's duties and activities on behalf of
the Company as provided for herein, an annual salary ("Base Salary") of two
hundred fifty thousand dollars ($250,000.00), which shall be paid by the Company
to Employee in equal and regular installments not less frequently than monthly,
in accordance with the Company's policy for payment of Employee salaries and
which shall be increased by five percent (5%) each year beginning with the first
anniversary of the Effective Date.
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(b) ANNUAL BONUS
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Employee shall receive an annual bonus of three (3%)
percent of the Company's pre-tax income up to five million ($5,000,000) dollars,
and four (4%) percent of the Company's pre-tax income over five million
($5,000,000) dollars, which shall be computed as at December 31 for each fiscal
year commencing with the fiscal year ending December 31, 1999.
(c) SIGNING STOCK OPTION BONUS
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Upon the execution of an Employment Agreement dated May
1, 1997, Employee was granted one million five hundred thousand (1,500,000)
options to purchase shares of Common Stock of the Company (the "Options"). The
vesting schedule for the Options is as follows: (i) five hundred thousand
($500,000) on the date of the grant, (ii) five hundred thousand ($500,000) on
the first anniversary of the grant and (iii) five hundred thousand ($500,000) on
the second anniversary of the grant.
7. OPTIONS
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From time to time, the Company shall grant to Employee
additional Options ("Future Options"). The Company shall enter into an option
agreement for the issuance of such Future Options.
8. FRINGE BENEFITS
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In addition to the base compensation set forth in Articles 6
and 7 above, Employee shall be entitled to receive the following benefits:
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(a) Any benefits under group hospitalization, health, dental
care or sick leave plan, life or other insurance or death benefit plan, travel
or accident insurance, or contingent compensation plan, or any other present or
future plan, including any qualified retirement plan, for which any Employees
are or shall become eligible. If Employee is not eligible for health benefits as
described above, by reason of age, location or otherwise, then Employee shall be
provided equivalent benefits determined at the election of the Company. Employee
shall be eligible to receive the foregoing benefits during the five (5) year
period following the termination of his employment under this Agreement; and
(b) An annual vacation of up to thirty (30) days, whether
taken individually or consecutively ("Vacation Period"), at such time or times
as shall be approved by the Company, and which approval shall not be
unreasonably withheld. Full compensation shall be paid during any Vacation
Period. Any portion of any Vacation Period not used within any year shall be
accrued and will accumulate, and may be used by Employee at any time during his
employment in accordance with the provisions of this Article 8. Employee at any
time during the Term of this agreement or its renewal, may elect to convert to
annual Base Salary ("Conversion") all or any portion of any accrued Vacation
Period days(s), whether it accrued under the Term of this Agreement, or any
renewal hereof, or any prior employment agreement. In the event Employee elects
to effect a conversion, then the Conversion shall be pro rata based upon the
number of days of Vacation Period as that bears to the then prevailing annual
Base Salary, regardless of when the unused Vacation Period day(s) accrued. If
Employee has not used all of his accrued and accumulated vacation time at the
termination of his employment, then Employee may then elect to have his accrued
and accumulated Vacation Period time converted to annual Base Salary, pro rata
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at the then prevailing Base Salary, regardless of when the unused vacation time
accrued; and
(c) Employee may incur and shall be reimbursed for reasonable
expenses that are related to the Company's business, including expenses for
entertainment, travel and similar items ("Approved Reimbursable Expenses"). All
such reimbursement of Approved Reimbursable Expenses shall be made within thirty
(30) days of receipt by the Company from Employee of an itemized account and if
necessary proper substantiation of Approved Reimbursable Expenses. In order to
facilitate the payment of the Approved Reimbursable Expenses, the Company shall
furnish Employee with Company acquired credit cards as may be available to all
other Employee officers of the Company; and
(d) Employee shall be given a private office with secretarial
help and any and all reasonable facilities and services so as to be suitable
with his position as President and Chief Employee Officer, and so as to assist
in the performance of his duties and activities; and
(e) Employee shall be given an automobile allowance or
automobile lease plan to the extent of seven thousand five hundred dollars
($7,500.00) per annum, paid in twelve (12) equal monthly installments, to be
used to defray acquisition expense for a luxury automobile, and insurance and
maintenance expenses for the automobile.
9. CHANGE IN CONTROL
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Notwithstanding any other provision to the contrary, the
following provisions will govern in the event of a change in control as defined
herein.
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(a) A change in control shall be deemed to have occurred if,
at any time, substantially all the assets of the Company shall have been sold or
transferred by sale, merger or otherwise, or if any "person" (as such term is
used in Sections 13(d) or 14(d) of the Exchange Act) becomes the beneficial
owner, directly or indirectly, of securities of the company representing fifty
percent (50%) or more of the combined voting power of the then-existing
outstanding securities of the Company.
(b) If a change in control occurs as defined in subsection
9(a) above, then the Company shall pay to Employee an amount equal to (i)
forty-eight (48) months base salary and (ii) an amount equal two times any
bonuses paid in respect of the preceding fiscal year.
(c) If a change in control occurs as defined in subsection
9(a) above, then all Future Options granted to Employee shall immediately vest
and become exercisable. Such acceleration of the vesting of stock options shall
be in addition to, and shall have no affect on, any payments accrued pursuant to
subsection 9(b).
(d) If change in control occurs as defined in subsection 9(a)
above, then the Company shall also pay to Employee an amount equal to the sum of
(x) excise taxes imposed on Employee under Section 4999 of the Code and (y)
income taxes due from Employee with respect to the payment of the amount in
subsection (x) above as well as the payment for income taxes under this
subsection 9(d).
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10. DISCLOSURE OF INFORMATION AND NON-COMPETITION
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(a) Employee recognizes and acknowledges that during the
course of his employment he will have access to certain confidential information
of the Company and that such information constitutes valuable, special and
unique property of the Company. During the Term of this Agreement and following
termination of his employment hereunder, Employee will not disclose information,
including any trade secrets or confidential information of the Company obtained
during the course of his employment with the Company, except such information as
may have become part of the public domain through no fault of Employee, which
public domain determination shall only be made by the Company in a written
acknowledgment made at the request of Employee, before Employee may be free to
disclose any such claimed public domain information.
(b) During the Term of this Agreement, and for two (2) years
thereafter, Employee will not, directly or indirectly, engage in any business
enterprise or activity competitive with the business of the Company either as an
employee, consultant, partner, shareholder, or in any other capacity. For the
purposes of this covenant not to compete, a competing business enterprise will
be deemed competitive only if such business enterprise conducts activities in
the development of investments and financial services similar to the activities
of the Company. Further, Employee agrees that he will not either during or
within two (2) years subsequent to the termination of his employment, disturb,
entice, hire or in any other manner attempt to persuade any employee, dealer,
supplier or customer of the Company to discontinue its business relationship
with the Company.
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(c) The Employee and the Company acknowledge that it would be
very difficult or impossible to measure the damages resulting from a breach of
this Article 10, and that any such breach would cause immediate and irreparable
harm. Therefore, in consequence of the foregoing, Employee hereby agrees that
any breach or threatened breach by him of any provision of this Article 10 shall
entitle the Company, in addition to any other legal remedies available to it, to
obtain from any Court of competent jurisdiction a temporary and permanent
injunction in order to enjoin such breach or threatened breach, without the
necessity on the part of the Company, in any application for such injunctive
relief to show immediate and irreparable harm, which would be a requirement of
such an application absent this covenant waiving those requirements. Employee
also covenants that the service of any papers to commence any legal proceedings,
including proceedings to obtain injunctive relief, may be done by utilizing
Federal Express in lieu of any other form of personal delivery of the process or
orders of the Court and upon doing so the service and notice provisions for the
commencement of legal proceedings shall be satisfied.
(d) Notwithstanding any other provision to the contrary, in
the event of a change in control as defined in subsection 9(a) above, this
Article 10 will not apply.
11. DEATH DURING EMPLOYMENT
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If Employee dies during the Term of his employment, then the
Company shall pay to his estate compensation which would otherwise be payable to
Employee for the shorter of (i) three (3) years from the date of his death, or
(ii) the period ending on the Expiration Date of this Agreement. Said sums shall
be paid in accordance with written directions given by Employee to the Company,
or lacking any such directions then to the surviving spouse of Employee, or if
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there is no surviving spouse, then to his surviving children in equal shares, or
if there are none, then to his estate.
12. PATENTS, COPYRIGHTS AND PROPRIETARY RIGHTS
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During the Term of his employment, all work product emanating
directly and/or indirectly from Employee's duties and activities effected on
behalf of the Company ("Work Product") shall be exclusively owned by the
Company. If any such Work Product is the subject of an application for patent,
copyright, trade ▇▇▇▇ or similar proprietary protection ("Application"), then
regardless of the name of the person or entity submitting the Application,
Employee hereby acknowledges the Company's exclusive rights in and to the
Application for proprietary protection. If the Application results in the
issuance of the requested proprietary protection, e.g., a patent or copyright,
then Employee hereby acknowledges the Company's exclusive ownership therein, and
Employee will execute any documents necessary to give effect and implement this
ownership, including but not limited to an assignment of the Application and/or
the issued proprietary protection.
13. NOTICES
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Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and actually delivered, or if sent
either by Federal Express, or postage prepaid, by certified mail, return receipt
requested, with a copy by ordinary mail, to the addresses below:
As to Company: Universal Heights, Inc.
▇▇▇▇ ▇.▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
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As to Employee: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
or to such other address as either party shall designate by written notice to
the other.
14. ASSIGNMENT
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The rights and obligations of the Company under this Agreement
shall inure to the benefit of and shall be binding upon the successors and
assigns of the Company. Employee acknowledges that the services to be rendered
by him are unique and personal, and accordingly, he may not assign any of his
rights, duties, obligations or benefits under this Agreement.
15. ENTIRE AGREEMENT
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This Agreement contains the entire agreement and understanding
of the Company and Employee with respect to the subject matter hereof, and shall
incorporate, merge and supersede all prior agreements and understandings between
the Company and Employee, either oral or written, if any. No modification,
change or amendment to this Agreement, shall be binding upon the Company or
Employee unless the same is in writing, and signed by the party against whom
enforcement of the modification, change or amendment is sought to be enforced.
16. MISCELLANEOUS
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(a) This Agreement and the implementation of it shall be
subject to and governed by the laws of the State of Florida, and any legal
proceedings relating to (i) the interpretation or enforcement of any of the
provisions of this Agreement, or (ii) any dispute relating to the employment
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relationship created by the Agreement, shall only be brought in the Circuit
Court of the State of Florida, in and for the County of Dade.
(b) The Article headings contained herein are for reference
purposes only and shall not in any way affect the meaning or the interpretation
of this Agreement.
(c) The failure of any provision of this Agreement shall in no
manner affect the right to enforce the remainder of this Agreement, and the
waiver by either the Company or Employee of any breach of any provision of this
Agreement shall not be construed to be a waiver by the Company or Employee of
any succeeding breach of such provision or a waiver by such party of any breach
of any other provision of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
on the date first written above.
Employee:
Witness:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
UNIVERSAL HEIGHTS, INC.
Witness:
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
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By: ▇▇▇▇▇ ▇▇▇▇▇▇▇, Secretary
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SCHEDULE 1
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OUTSIDE BUSINESS INTERESTS
As of execution date:
UNIVERSAL HEIGHTS, INC.
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By:
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Dated: ______________, ____
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