SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------------
FORM 10-K/A
(Mark One)
/x/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1997
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from __________________ to ___________________
Commission file number 1-13381
HOSPITALITY WORLDWIDE SERVICES, INC.
- --------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
New York 11-3096379
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. employer identification no.)
incorporation or organization)
450 Park Avenue, Suite 2603, New York, New York 10022
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (212) 223-0699
Securities registered pursuant to Section 12(b) of the Act:
Name of Each Exchange
Title of Each Class on Which Registered
------------------- -------------------
Common Stock, $.01 par value American Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes /x/ No / /
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. / /
The aggregate market value of the Common Stock, $.01 par value per
share (the "Common Stock"), held by non-affiliates of the Registrant as of April
27, 1998 (based upon the last sale price for the Common Stock on the American
Stock Exchange) was approximately $98,939,137.
The number of shares of Common Stock outstanding as of April 27, 1998
was 11,868,022.
<PAGE>
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Directors and Executive Officers
The directors and executive officers of the Company and their positions with the
Company are set forth below.
Name Age Position
---- --- --------
Robert A. Berman 38 Chairman of the Board, Chief
Executive Officer and Director
Leonard F. Parker 68 Chairman Emeritus
Douglas A. Parker 40 President & Chief Operating Officer
Howard G. Anders 54 Executive Vice President, Chief
Financial Officer & Secretary
Scott A. Kaniewski 34 Director
Louis K. Adler 62 Director
George Asch 60 Director
Richard A. Bartlett 40 Director
ROBERT A. BERMAN has been President and Chief Executive Officer and a director
of the Company since March 1997. Prior to joining the Company, Mr. Berman served
as the Managing Director of Watermark LLC from September 1992 to March 1997 and
is currently the sole Manager of Watermark LLC. Mr. Berman is also Vice Chairman
and a director of Unistar Gaming Corporation, a wholly-owned subsidiary of
Executone Information Systems, and a director of Catskill Development, LLC, the
owner of an operating harness track.
LEONARD F. PARKER has been Chairman of the Board of the Company since March
1997. Leonard Parker founded LPC in 1969. Mr. Parker is a graduate of Tulane
University and served in the United States Air Force. Prior to founding The
Leonard Parker Company ("LPC"), Mr. Parker was employed from 1950 by Maxwell
Company, an interior design and furnishing company. Mr. Parker serves on various
committees for the Special Olympics. Leonard Parker is the father of Douglas
Parker.
DOUGLAS A. PARKER has been President-Purchasing Division and a director of the
Company since March 1997. Mr. Parker is also President of LPC. Mr. Parker, a
graduate of Tulane University in International Business, has been with LPC for
17 years. Mr. Parker is responsible for the development of the overseas offices
in Sandton, Singapore and Dubai, coordinating the international operations and
sales, as well as vendor and client relationships. Mr. Parker is also a director
of Shelby Williams Industries, Inc. Douglas Parker is the son of Leonard Parker.
HOWARD G. ANDERS has been Executive Vice President, Chief Financial Officer and
Secretary of the Company since February 1996 and was the Executive Vice
President, Chief Operating Officer and a director of the Company from October
1994 to November 1995. From December 1995 to February 1996, Mr. Anders was an
independent consultant. Mr. Anders served as Vice President and Chief Financial
Officer of Alpine Lace Brands, Inc. in Maplewood, New Jersey from April 1992 to
October 1994. From April 1983 to April 1992, Mr. Anders was President and Chief
Operating Officer of North Hills Electronic, Inc. in Glen Cove, New York. Mr.
Anders is a graduate of Rutgers University and attended the Harvard Business
School PMD Program.
SCOTT A. KANIEWSKI has been a director of the Company since March 1996. Mr.
Kaniewski has been a Member of Watermark LLC since February 1995 and the
President of Watermark LLC since May 1997. Prior to his involvement with
Watermark LLC, Mr. Kaniewski held several positions with VMS Realty Partners,
including Vice President of Hotel Investments from December 1988 to March 1995.
He is a Certified Public Accountant and a member of the Illinois CPA Society.
LOUIS K. ADLER has been a director of the Company since September 1996. Mr.
Adler has been a private investor for over five years in Houston, Texas. He has
been Chairman of the Board and President of Bancshares, Inc. (Houston, TX) since
1973; Vice Chairman of the Board since 1992 and a director since 1988 of
Luther's Bar-B-Q, Inc., a group of twenty restaurants in Texas, Louisiana and
Colorado; a director, Secretary and Treasurer of Warwick Communications,
-2-
<PAGE>
Inc. since 1993; and a director and officer of several other private companies.
Mr. Adler is also a trustee and the President of the Adler Foundation and member
of the Dean's Advisory Counsel of Goizueta Business School of Emory University.
GEORGE ASCH has been a director of the Company since September 1996. Since
September 1994, Mr. Asch has been a Vice President of Gray, Seifert and Co.,
Inc. an investment management company which became a wholly-owned independent
subsidiary of Legg Mason, Inc. in April 1994. For 25 years prior to joining Gray
Seifert and Co., Inc. in August 1990, Mr. Asch served as President of a
manufacturing company. He currently serves on the boards of various
philanthropic organizations, including the Montefiore Medical Center and the
Price Foundation. He is a graduate of Columbia College and served as an officer
in the United States Navy.
RICHARD A. BARTLETT has been a director of the Company since September 1996. Mr.
Bartlett is a Managing Director of Resource Holdings Limited, a private merchant
banking firm in New York City ("Resource Limited"). He specializes in legal
aspects of mergers, acquisitions and other corporate restructurings. In that
capacity, he sits and has sat on the board of various companies in which
Resource Limited and its principals have made investments. From 1987 to 1993, he
was a member of the Council of Foreign Relations and is a member of the New York
State Bar. Mr. Bartlett received a law degree from Yale Law School and received
his B.A. from Princeton University.
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's officers and directors, and persons who own more than ten
percent of a registered class of the Company's equity securities, to file
reports of ownership and changes in ownership with the Securities and Exchange
Commission (the "Commission"). Officers, directors and greater than ten percent
shareholders are required by the Commission's regulations to furnish the Company
with copies of all Section 16(a) forms they file. During the year ended December
31, 1997, all of such forms were filed in a timely manner with the exception of
(i) Forms 3 with respect to one transaction for each Leonard Parker, Douglas
Parker and Bradley Parker; (ii) Forms 4 with respect to one transaction for each
of Richard Bartlett, Scott Kaniewski, George Asch and Louis Adler; and (iii) a
Form 5 with respect to one transaction for Watermark LLC.
Meetings and Committees
The Company's Board of Directors met seven times in 1997. The
Compensation Committee and the Audit Committee each met two times in 1997. The
Compensation Committee consists of Louis K. Adler, George Asch and Richard A.
Bartlett. The Audit Committee consists of Louis K. Adler and George Asch.
-3-
<PAGE>
Item 11. EXECUTIVE COMPENSATION
The following table sets forth, for the fiscal years indicated, all
compensation awarded to, earned by or paid to Robert Berman, Leonard Parker,
Douglas Parker and Howard Anders, the Company's four most highly compensated
executives (the "Named Executive Officers"). There is no other executive officer
of the Company whose salary and bonus exceeded $100,000 with respect to the
fiscal years ended December 31, 1997, 1996 and 1995.
SUMMARY COMPENSATION TABLE(1)
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
----------------------------------- --------------------------------
Awards Payouts
---------------------- --------
Securities
Other Annual Restricted Underlying LTIP All Other
Name and Principal Salary Bonus Compensation Stock Options/ Payouts Compensation
Position Year ($) ($) ($) Awards ($) SARs(#) ($) ($)
- ------------------ ----- --------- -------- ------------- ---------- ---------- -------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Robert A. Berman (2) 1997 $161,000 -- -- -- 160,000 -- --
1996 -- -- -- -- -- -- --
1995 -- -- -- -- -- -- --
Leonard F. Parker (3) 1997 $250,000 -- -- -- -- -- --
1996 -- -- -- -- -- -- --
1995 -- -- -- -- -- -- --
Douglas A. Parker (4) 1997 $175,000 -- -- -- 100,000 -- --
1996 -- -- -- -- -- -- --
1995 -- -- -- -- -- -- --
Howard G. Anders (5) 1997 $215,000 -- -- -- 15,000 -- --
1996 $150,000 -- -- -- 100,000 -- --
1995 $128,000 -- -- -- 50,000 -- --
</TABLE>
- --------------------
(1) Perquisites and other personal benefits, securities or property to each
executive officer did not exceed the lesser of $50,000 or 10% of such
executive's salary and bonus.
(2) Mr. Berman joined the Company in March 1997 as the President, Chief
Executive Officer and Director. In November 1997, he became the
Chairman of the Board, Chief Executive Officer and a Director.
(3) Mr. Leonard Parker joined the Company in March 1997 as Chairman of the
Board and Director. In November 1997, he became Chairman Emeritus of
the Board of Directors.
(4) Mr. Douglas Parker joined the Company in March 1997 as
President--Purchasing Division and Director. In November 1997, he
became the President, Chief Operating Officer and a Director.
(5) Mr. Howard Anders joined the Company in October 1994 as Executive Vice
President, Chief Operating Officer and Director. In February 1996, he
resigned as a Director of the Company and became the Chief Financial
Officer, Executive Vice President and Secretary.
-4-
<PAGE>
The following table sets forth certain information regarding stock
option grants made to the Named Executive Officers during the fiscal year ended
December 31, 1997.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Potential
Realizable Value at
Assumed Annual Rates of
Stock Price Appreciation
Individual Grants For Option Term(1)
------------------------------------------------------------- ------------------------------
Number of % of Total
Securities Options/SARs
Underlying Granted to Exercise
Options/SARs Employees in Price Expiration
Name Granted(2) Fiscal Year Per Share Date 5% 10%
- ------------------- --------------- --------------- ----------- ------------- ------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Robert A. Berman...... 160,000 21.7% $12.00 12/17/07 $1,207,477 $3,059,985
Leonard F. Parker..... -- -- -- -- -- --
Douglas A. Parker..... 65,000 8.8% $6.75 1/10/07 $275,927 $699,254
Douglas A. Parker..... 35,000 4.8% $12.00 12/17/07 $264,136 $669,372
Howard G. Anders...... 15,000 2.0% $12.00 12/17/07 $113,201 $286,874
</TABLE>
The following table sets forth certain information regarding
unexercised stock options held by the Named Executive Officers as of December
31, 1997.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL
YEAR-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
Number of
Securities Value of Unexercised
Underlying In-the-Money
Shares Unexercised Options/SARs Options/SARs At
Acquired On Value At Fiscal Year-End Fiscal Year-End
Name Exercise Realized($) Exercisable/Unexercisable(1) Exercisable/Unexercisable
- --------------------- ----------- ------------- ------------------------------- -----------------------------
<S> <C> <C> <C> <C>
Robert A. Berman....... -- -- 0/160,000 0/$180,000
Leonard F. Parker...... -- -- -- --
Douglas A. Parker...... -- -- 0/100,000 0/$453,750
Howard G. Anders....... -- -- 175,000/40,000 $1,963,125/$276,250
</TABLE>
- -------------------
(1) On December 31, 1997, the last reported sales price of the Common Stock
on the American Stock Exchange was $13.125 per share.
Long-Term Incentive and Pension Plans
The Company does not have any long-term incentive or defined benefit
pension plans.
Director Compensation
The Company does not currently compensate directors who are also
executive officers of the Company for service on the Board of Directors. Outside
directors are paid a fee of $750 and reimbursed for their expenses incurred in
attending each meeting of the Board of Directors and its Committees.
On September 26, 1996, the Company's Board of Directors adopted, and
the Company's shareholders approved, the 1996 Outside Directors Stock Option
Plan (the "Outside Directors' Plan") for purposes of securing for the Company
and its shareholders the benefits arising from stock ownership by its outside
directors.
Compensation Committee Interlocks and Insider Participation
The Company's Compensation Committee, which exercises the power which
the Board of Directors would otherwise hold with respect to the grant of options
under the 1996 Stock Option Plan as well as the compensation and benefits of all
officers of the Company, consists of Louis K. Adler, George Asch and Richard A.
Bartlett. Mr. Bartlett is a Managing Director of Resource Holdings Associates,
L.P. ("Resource Holdings"). The Company has renewed its engagement with Resource
Holdings as a financial advisor. As compensation for
-5-
<PAGE>
such engagement, the Company has agreed to pay Resource Holdings a retainer of
$10,000 per month for at least one year. The Company, pursuant to the terms of
its previous agreement, granted Resource Holdings a five-year option to purchase
500,000 shares of Common Stock at an exercise price of $2.00 per share.
Other
No director or executive officer is involved in any material legal
proceeding in which he is a party adverse to the Company or has a material
interest adverse to the Company.
Employment Agreements
The Company entered into a new three-year employment agreement with Mr.
Berman as of January 1, 1998. The term of the employment agreement may be
renewed for one year periods by mutual agreement of Mr. Berman and the Company.
The employment agreement provides for base compensation at the rate of $300,000
per annum plus an annual bonus determined by the Company's Board of Directors in
its sole discretion. In the event of a change of control (as defined in the
employment agreement) which results in either (i) the termination of Mr.
Berman's services for any reason other than voluntary withdrawal or cause, (ii)
the placement of Mr. Berman in a position of lesser stature than that of a
senior executive officer of the Company; (iii) a breach of certain provisions of
Mr. Berman's employment agreement; (iv) a requirement that Mr. Berman's
principal duties be performed outside of Manhattan, or (v) Mr. Berman's decision
to leave the Company after one year, the Company must pay to Mr. Berman, as
liquidated damages, a lump sum cash payment equal to 2.99 times his base salary
and last bonus paid (up to certain limitations). The employment agreement also
contains confidentiality and non-compete provisions during the term of the
agreement and for a period of two years thereafter.
The Company entered into a four-year employment agreement with Mr.
Leonard Parker on January 9, 1997 with a base compensation of $250,000 per
annum. Pursuant to such agreement, the salary for the final year of the
agreement was paid in full at signing. Further, Mr. Leonard Parker has agreed
not to compete with the Company during the term of the agreement and for a
period of one year thereafter.
The Company entered into a new two-year employment agreement with Mr.
Douglas Parker as of January 1, 1998. The term of the employment agreement may
be renewed for one year periods by mutual agreement of Mr. Douglas Parker and
the Company. The employment agreement provides for base compensation at the rate
of $250,000 per annum plus an annual bonus determined by the Company's Board of
Directors in its sole discretion. In the event of a change of control (as
defined in the employment agreement) which results in either (i) the termination
of Mr. Douglas Parker's services for any reason other than voluntary withdrawal
or cause, (ii) the placement of Mr. Douglas Parker in a position of lesser
stature than that of a senior executive officer of the Company; (iii) a breach
of certain provisions of Mr. Douglas Parker's employment agreement; or (iv) a
requirement that Mr. Douglas Parker's principal duties be performed outside a 30
mile radius from the location at which Mr. Douglas Parker had performed his
duties immediately prior to the change of control, the Company must pay to Mr.
Douglas Parker, as liquidated damages, a lump sum cash payment equal to 2.99
times his base salary (subject to certain limitations). The employment agreement
also contains confidentiality and non-compete provisions during the term of the
agreement and for a period of two years thereafter.
The Company entered into a new three-year employment agreement with Mr.
Anders as of January 1, 1998. The term of the employment agreement may be
renewed for one year periods by mutual agreement of Mr. Anders and the Company.
The employment agreement provides for base compensation at the rate of $225,000
per annum plus an annual bonus determined by the Company's Board of Directors in
its sole discretion. In the event of a change of control (as defined in the
employment agreement) which results in either (i) the termination of Mr. Anders'
services for any reason other than voluntary withdrawal or cause, (ii) the
placement of Mr. Anders in a position of lesser stature than that of a senior
executive officer of the Company; (iii) a breach of certain provisions of Mr.
Anders' employment agreement; or (iv) a requirement that Mr. Anders' principal
duties be performed outside a 30 mile radius from the location at which Mr.
Anders had performed his duties immediately prior to the change of control, the
Company must pay to Mr. Anders, as liquidated damages, a lump sum cash payment
equal to 2.99 times his base salary (subject to certain limitations). The
employment agreement also contains confidentiality and non-compete provisions
during the term of the agreement and for a period of two years thereafter.
1996 Stock Option Plan
On September 26, 1996, the Company's Board of Directors adopted, and
the Company's shareholders approved, the 1996 Stock Option Plan (the "Plan") for
the purpose of providing incentive to the officers and employees of the Company
who are primarily responsible for the management and growth of the Company. Each
option granted pursuant to the Plan shall be designated at the time of grant as
either an "incentive stock option" or as a "non-qualified stock option". As of
December 31, 1997, the Company has granted options to purchase 1,636,000 shares
of Common Stock under the Plan at grant prices ranging from $2.75 to $12.00 per
share, of which 72,250 shares have been exercised, and 619,875 are currently
exercisable. The term for each option granted is determined by the Compensation
Committee, provided the maximum length of the term of each
-6-
<PAGE>
option granted will be no more than ten years. At December 31, 1997, 64,000
options were available for grant under the Plan.
1996 Outside Directors' Stock Option Plan
Each outside director who becomes an outside director after March 1,
1996 shall immediately receive the grant of an option to purchase 15,000 shares
of Common Stock. To the extent that shares of Common Stock remain available for
the grant of options under the Outside Directors' Plan, on April 1 of each year,
commencing on April 1, 1997, each outside director shall be granted an option to
purchase 10,000 shares of common stock. Options granted under the Outside
Directors' Plan shall become exercisable in three equal installments, commencing
on the first anniversary of the grant date. On September 26, 1996, The Company
granted options to purchase 60,000 shares of Common Stock under the Outside
Directors' Plan with an exercise price of $2.75. On April 1, 1997, the Company
granted options to purchase 40,000 shares of Common Stock under the Outside
Directors' Plan with an exercise price of $6.125 per share. As of December 31,
1997, 20,000 of such options were exercisable.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The voting securities of the Company outstanding on April 28, 1998
consisted of 11,868,022 shares of Common Stock. The following table sets forth
information concerning ownership of the Common Stock, as at March 30, 1998, by
(i) each director, (ii) each executive officer, (iii) all directors and
executive officers as a group, and (iv) each person who, to the knowledge of
management, owned beneficially more than 5% of the Common Stock. Unless
otherwise indicated, the address of each person listed below is 450 Park Avenue,
New York, New York 10022.
<TABLE>
<CAPTION>
Common Stock
Beneficial Owner(1) Beneficially Owned Percent of Class(2)
- --------------------------------------------------- --------------------- ---------------------
<S> <C> <C>
Robert A. Berman...................................... 687,085(3) 5.8%
Leonard F. Parker..................................... 271,435 2.3%
550 Biltmore Way
Coral Gables, Florida 33134
Douglas A. Parker..................................... 176,667(4) 1.5%
550 Biltmore Way
Coral Gables, Florida 33134
Howard G. Anders...................................... 179,600(5) 1.5%
Richard A. Bartlett................................... 416,499(6) 3.5%
c/o Resource Holdings Associates, L.P.
520 Madison Avenue, 40th Floor
New York, New York 10022
Scott A. Kaniewski.................................... 100,423(7) *
Louis K. Adler........................................ 83,333(8) *
910 Travis Street, Suite 2030
Houston, Texas 77002-5810
George Asch........................................... 83,333(9) *
c/o Gray Seifert & Company, Inc.
380 Madison Avenue
New York, New York 10022
All Executive Officers and Trustees as a group (8 2,006,875(10) 16.2%
persons)..............................................
</TABLE>
- ----------
* Less than 1%
(1) Except as outlined herein, the persons named in the table, to the
Company's knowledge, have sole voting and dispositive power with
respect to all shares shown as beneficially owned by them, subject to
community property laws where applicable and the information contained
in the footnotes hereunder.
(2) Calculations assume that all options and warrants which are presently
exercisable or exercisable within 60 days have been exercised.
(3) Consists of (i) 474,085 shares of Common Stock held individually by Mr.
Berman; (ii) 200,000 shares of Common Stock held by Watertone Holdings,
L.P., a Delaware limited partnership and affiliate of the Company
("Watertone"), as to which Mr. Berman is attributed beneficial
ownership (as the sole Manager of Watertone's general partner) pursuant
to Rule 13d-3 ("Rule 13d-3") of the Exchange Act;
-7-
<PAGE>
and (iii) 13,000 shares of Common Stock held by Watermark LLC as to
which Mr. Berman is attributed beneficial ownership (as sole Manager)
pursuant to Rule 13d-3.
(4) Consists of (i) 155,000 shares of Common Stock held individually by Mr.
Parker; and (ii) 21,667 shares of Common Stock issuable upon exercise
of presently exercisable options currently held by Mr. Parker.
(5) Consists of (i) 4,600 shares of Common Stock held individually by Mr.
Anders and (ii) 175,000 shares of Common Stock issuable upon exercise
of presently exercisable options currently held by Mr. Anders.
(6) Consists of (i) 108,666 shares of Common Stock owned individually by
Mr. Bartlett: (ii) 300,000 shares of Common Stock underlying an option
granted to Resource Holdings as to which Mr. Bartlett is attributed
beneficial ownership pursuant to Rule 13d-3; and (iii) 8,333 shares of
Common Stock issuable upon exercise of presently exercisable options
currently held by Mr. Bartlett. Mr. Bartlett has sole power to vote and
dispose of the 116,666 shares of Common Stock he owns individually and
the 8,333 shares of Common Stock underlying presently exercisable
options. Mr. Bartlett, as a Managing Director of Resource Holdings, has
shared power to vote and dispose of the 300,000 shares of Common Stock
underlying Resource Holdings' option.
(7) Consists of (i) 92,090 shares of Common Stock held individually by Mr.
Kaniewski; and (ii) 8,333 shares of Common Stock issuable upon exercise
of presently exercisable options currently held by Mr.
Kaniewski.
(8) Consists of (i) 75,000 shares of Common Stock held individually by Mr.
Adler; and (ii) 8,333 shares of Common Stock issuable upon exercise of
presently exercisable options currently held by Mr. Adler.
(9) Consist of (i) 75,000 shares of Common Stock held individually by Mr.
Asch and (ii) 8,333 shares of Common Stock issuable upon exercise of
presently exercisable options currently held by Mr. Asch.
(10) Includes presently exercisable options to purchase 529,999 shares of
Common Stock at exercise prices ranging from $1.275 to $6.125 per
share.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On February 1, 1998, the Company renewed its engagement of Resource
Holdings as a financial advisor. As compensation for such engagement, the
Company has agreed to pay Resource Holdings a retainer of $10,000 per month for
at least one year. The Company, pursuant to the terms of its previous agreement,
granted Resource Holdings a five-year option to purchase 500,000 shares of
Common Stock at an exercise price of $2.00 per share.
In May 1997, the Company entered into an Agreement to Joint Venture
(the "Joint Venture Agreement") with Apollo Real Estate Advisors II, L.P., a
Delaware limited partnership ("Apollo") and Watermark LLC. Pursuant to the Joint
Venture Agreement, Watermark LLC receives a management fee of 1 1/2% of all
costs (other than soft costs) incurred in acquiring and rehabilitating a
particular project. On February 9, 1998, the Company purchased the assets of the
real estate advisory business from Watermark Limited LLC, including all of
Watermark LLC's right, title and interest to the aforementioned management fees
payable under the Joint Venture Agreement. The Company paid Watermark LLC
$1,500,000 as consideration.
The Company has performed renovation services for Watermark Limited
LLC. During the second quarter of 1997, the Company renegotiated a renovation
contract with Watermark to provide for fees more consistent with a project of
similar scope and complexity. As a result of the revision, the Company
recognized additional revenue of $409,000 and a job to date adjustment of
$778,000, resulting in additional gross margin of approximately $780,000 without
an accompanying increase in costs. As of December 31, 1997, the Company has no
receivables from Watermark.
-8-
<PAGE>
PART IV
Item 14. EXHIBITS AND REPORTS ON FORM 8-K.
**(a)(1) and (2) Financial Statements:
o Hospitality Worldwide Services, Inc. and Subsidiaries
o Report of Independent Public Accountants
o Consolidated Financial Statements
(3) Exhibits
Exhibit
Number Exhibits
**3.1 Certificate of Incorporation, as amended, of the Company.
3.2 Amended and Restated By-laws of the Company (Incorporated by
reference to the Company's Registration Statement on Form S-B2,
No. 333-31765).
4.1 Specimen Common Shares Certificate (Incorporated by reference
to Exhibit 4.1 to the Company's Registration Statement on Form
SB-2, No. 33-7094-NY).
4.2 Rights Agreement dated as of November 24, 1997, by and between
the Company and Continental Stock Transfer & Trust Company, as
rights agent (the "Rights Agreement") (Incorporated by
reference to the Company's Registration Statement on Form 8-A
filed with the Commission on December 2, 1997).
**4.3 Amendment to Rights Agreement dated January 7, 1998.
10.1 Asset Purchase Agreement dated as of April 1, 1995, by and
among AGF Interior Services Co., Watermark Investments Limited
(Bahamas), Watermark Investments Limited (Delaware), HRB, the
Company and Tova Schwartz (Incorporated by reference to the
Company's Current Report on Form 8-K dated August 22, 1995).
10.2 Divestiture, Settlement and Reorganization Agreement dated as
of February 26, 1996, by and among the Company, HRB, Watermark
Investments Limited (Bahamas), Watermark Investments Limited
(Delaware), AGF Interior Services Co., Tova Schwartz, Alan G.
Friedberg and Guillermo Montero (Incorporated by reference to
Exhibit 10.2 to the Company's Form 10-KSB for the year ended
December 31, 1995).
10.3 Memorandum Agreement dated April 12, 1996, by and between the
Company and Watermark (Incorporated by reference to Exhibit
10.3 to the Company's Form 10-KSB for the year ended December
31, 1995).
10.4 Bill of Sale and Assumption Agreement dated February 26, 1996,
by and between the Company and Tova Schwartz (Incorporated by
reference to Exhibit 10.4 to the Company's Form 10-KSB for the
year ended December 31, 1995).
10.5 Consulting Agreement dated February 28, 1996, by and between to
Company and Resource Holdings Associates (Incorporated by
reference to Exhibit 10.6 to the Company's Form 10-KSB for the
year ended December 31, 1995).
*10.6 Employment Agreement, dated as of January 1, 1998, by and
between the Company and Robert A. Berman.
*10.7 Employment Agreement, dated as of January 1, 1998, by and
between the Company and Howard G. Anders.
10.8 1996 Stock Option Plan (Incorporated by reference to Exhibit
4(a) to the Company's Registration Statement on Form S-8 filed
on February 12, 1997, File No. 333-32689).
10.9 Form of Option Agreement for the 1996 Plan (Incorporated by
reference to Exhibit 4(b) to the Company's Registration
Statement on Form S-8 filed on February 12, 1997, File No.
333-21689).
10.10 Form of Stock Agreement for the Outside Directors' Plan
(Incorporated by reference to Exhibit 4(c) to the Company's
Registration Statement on Form S-8 filed on February 12, 1997,
File No. 333-21689).
-9-
<PAGE>
10.11 Form of Option Granted to Officers (Incorporated by reference
to Exhibit 4(d) to the Company's Registration Statement on Form
S-8 filed on February 12, 1997, File No. 333-21689).
10.12 Agreement and plan of Merger dated as of January 9, 1997, by
and among Leonard Parker Company, LPC Acquisition Corp., and
the Company (incorporated by reference to Exhibit 2.1 of the
Company's Current Report on Form 8-K filed on January 24,
1997).
10.13 Employment Agreement, dated as of January 9, 1997, by and among
The Leonard Parker Company, the Company and Leonard Parker
(Incorporated by reference to Exhibit 10.13 to the Company's
Registration Statement on Form SB-2, No. 333-31765).
*10.14 Employment Agreement, dated as of January 1, 1998, by and
between the Company and Douglas Parker.
10.15 Registration Rights Agreement, dated as of January 9, 1997, by
and among the Company, Leonard Parker, Douglas Parker, Bradley
Parker, Philip Parker, Gregg Parker and Mitchell Parker
(Incorporated by reference to Exhibit 10.18 to the Company's
Registration Statement on Form SB-2, No. 333-31765).
10.16 Agreement to Joint Venture, dated as of May 12, 1997, by and
among Apollo Real Estate Advisors II, L.P., the Registrant and
Watermark Investments Limited, LLC. (Incorporated by reference
to Exhibit 10.19 to the Company's Registration Statement on
Form SB-2, No. 333-31765).
10.17 Warrant dated May 12, 1997 issued to Apollo Real Estate
Advisors II, L.P. (Incorporated by reference to Exhibit 10.20
to the Company's Registration Statement on Form SB-2, No.
333-31765).
10.18 Agreement and Plan of Merger, dated as of January 1, 1998, by
and among the Company, HWS Acquisition Corp., a Delaware
corporation, Bekins Distribution Services Co., Inc. and the
Sellers named therein (Incorporated by reference to the
Company's Current Report on Form 8-K dated January 9, 1998).
10.19 Registration Rights Agreement dated as of January 1, 1998, by
and among the Company and the Shareholders named therein.
10.20 Financial Advisory Agreement dated April 10, 1997, by and
between the Company and Resource Holdings Associates
(Incorporated by reference to Exhibit 10.21 to the Company's
Registration Statement on Form SB-2, No. 333-31765).
11 Computation of earnings per share (Incorporated herein by
reference to Note 15 to the Company's Consolidated Financial
Statements).
16.1 Letter from Arthur Andersen LLP dated March 19, 1996
(Incorporated by reference to the Company's Current Report on
Form 8-K/A filed March 25, 1996).
16.2 Letter from BDO Seidman, LLP dated March 19, 1997 (Incorporated
by reference to the Company's Current Report on Form 8-K dated
November 12, 1997).
**21 Subsidiaries of the Company.
**23.1 Consent of Arthur Andersen LLP dated March 31, 1998.
**23.2 Consent of BDO Seidman, LLP dated March 31, 1998.
**27 Financial Data Schedule.
- -------------------
* Filed herewith.
** Previously filed with the Company's 10-K for the year ended December
31, 1997.
Form 8-K filed with the Commission on January 24, 1997 reporting Item 2,
Acquisition on Distribution of Assets.
Form 8-K filed with the Commission on December 2, 1997 reporting Item 5, Other
Events.
Form 8-K filed with the Commission on December 19, 1997 reporting Item 1,
Changes in Registrant's Certifying Account.
-10-
<PAGE>
POWER OF ATTORNEY
Hospitality Worldwide Services, Inc. and each of the undersigned do
hereby appoint Robert A. Berman and Howard G. Anders, and each of them
severally, its or his true and lawful attorneys to execute on behalf of
Hospitality Worldwide Services, Inc. and the undersigned any and all amendments
to this Report and to file same with all exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission. Each of such
attorneys shall have the power to act hereunder with or without the other.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Company has duly caused this Report to be signed on
its behalf by the undersigned thereunto duly authorized on the 28th day of
April, 1998.
HOSPITALITY WORLDWIDE SERVICES, INC.
(Registrant)
By:/s/ Robert A. Berman
------------------------------------------
Robert A. Berman, Chairman of the Board,
Chief Executive Officer (principal executive
officer) and Director
Pursuant to the requirements of the Securities Exchange Act of 1934,
this Report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Robert A. Berman Chairman of the Board, Chief April 28, 1998
- ---------------------------- Executive Officer (principal
Robert A. Berman executive officer) and Director
/s/ Leonard F. Parker Chairman Emeritus of the Board April 28, 1998
- --------------------------- and Director
Leonard F. Parker
/s/ Douglas A. Parker President, Chief Operating April 28, 1998
- --------------------------- Officer and Director
Douglas A. Parker
/s/ Howard G. Anders Executive Vice President, April 28, 1998
- --------------------------- Chief Financial
Howard G. Anders Officer and Secretary
/s/ Scott A. Kaniewski Director April 27, 1998
- ---------------------------
Scott A. Kaniewski
/s/ Louis K. Adler
- ---------------------------- Director April 28, 1998
Louis K. Adler
/s/ George Asch Director April 27, 1998
- ----------------------------
George Asch
/s/ Richard A. Bartlett Director April 27, 1998
- ----------------------------
Richard A. Bartlett
-11-
EMPLOYMENT AGREEMENT
AGREEMENT made as of this 1st day of January, 1998, by and
between HOSPITALITY WORLDWIDE SERVICES, INC., a New York corporation with its
principal office at 450 Park Avenue, New York, New York 10022 (the
"Corporation"), and ROBERT BERMAN, residing at 2 River Road, Woodridge, New York
12789 ("Executive").
W I T N E S S E T H :
WHEREAS, Executive has heretofore been employed by the
Corporation;
WHEREAS, the Corporation desires to continue to employ
Executive, and Executive is willing to undertake such employment, upon the terms
and subject to the conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants hereinafter set forth, the parties hereto agree as follows:
1. Employment of Executive. The Corporation hereby employs
Executive as its Chairman of the Board and Chief Executive Officer, to perform
the duties and responsibilities incident to such offices, subject at all times
to the normal control and direction of the Board of Directors of the Corporation
(the "Board of Directors").
2. Acceptance of Employment; Time and Attention. Executive
hereby accepts such employment and agrees that throughout the Term (as
hereinafter defined), he will devote substantially his full time, attention,
knowledge and skills, faithfully, diligently
<PAGE>
and to the best of his ability, in furtherance of the business of the
Corporation, and will perform the duties assigned to him pursuant to Section 1
hereof, subject, at all times, to the normal direction and control of the Board
of Directors. Executive shall be the principal executive officer of the
Corporation and shall in general manage and control all of the day-to-day
operations of the Corporation. Executive shall also perform such specific duties
and shall exercise such specific authority related to the management of the
day-to-day operations of the Corporation consistent with his position as
Chairman of the Board and Chief Executive Officer as may be assigned to
Executive from time to time by the Board of Directors. Executive shall at all
times be subject to, observe and carry out such rules, regulations, policies,
directions and restrictions as the Corporation shall from time to time
establish. During the Term, Executive shall not, without the written approval of
the Board of Directors first had and obtained in each instance, directly or
indirectly, accept employment or compensation from, or perform services of any
nature for, any business enterprise other than the Corporation and its
subsidiaries. Notwithstanding the foregoing but subject to Section 9 hereof,
Executive shall be permitted to (i) serve as a director on the boards of
directors of other corporations and retain any compensation paid therefor,
provided that such other interests do not materially interfere with the
performance by Executive of his obligations hereunder, and (ii) engage in
business affairs outside the business of the Corporation provided that such
other interests do not materially
-2-
<PAGE>
interfere with his obligations hereunder. During the Term, Executive shall not
be entitled to additional compensation for rendering employment services to
subsidiaries of the Company or for serving in any office of the Corporation or
any of its subsidiaries to which he is elected or appointed. Executive shall be
permitted to establish a geographic base from which to perform his duties
hereunder.
3. Term. Except as otherwise provided herein, Executive's
employment hereunder shall be for a three (3) year term commencing as of January
1, 1998 (the "Initial Term"), which may be renewed for such one (1) year periods
as the Corporation and Executive may mutually agree during the ninety (90) day
period immediately prior to the expiration of the Initial Term or any renewal
thereof (the Initial Term and any such renewal thereof are hereinafter
collectively referred to as the "Term").
4. Compensation. The Corporation shall pay to the Executive,
commencing as of January 1, 1998, for the first year of his employment,
compensation at the rate of three hundred thousand ($300,000) dollars per year
("Base Salary"). For each year thereafter, the Base Salary will be increased by
(i) the percentage increase in the consumer price index (the "CPI") for the New
York/Northeastern New Jersey region, published by the United States Department
of Labor, at January 1 of such year over the CPI at January 1 of the prior year
or (ii) such higher amount as shall be determined by the Board of Directors.
Such compensation shall be payable in equal monthly installments. In addition,
Executive
-3-
<PAGE>
shall be entitled to receive from the Corporation such bonus (the "Bonus") as
the Board of Directors shall in its sole discretion determine. All compensation
paid to Executive shall be subject to withholding and other employment taxes
imposed by applicable law.
5. Additional Benefits. (a) In addition to such Base Salary,
he (and his family) shall be entitled to participate, to the extent he is (and
they are) eligible under the terms and conditions thereof, in any
profit-sharing, pension, retirement, hospitalization, insurance, disability,
medical service, stock option, bonus or other employee benefit plan generally
available to the executive officers of the Corporation that may be in effect
from time to time during the Term, as well as any discretionary bonus pool of
the Corporation. The Corporation shall be under no obligation to institute or
continue the existence of any such employee benefit plan.
(b) The Corporation shall obtain and maintain in full force
and effect during the Term, at the Corporation's sole cost and expense, a policy
or policies of term insurance on the life of Executive in the aggregate face
amount of five hundred thousand ($500,000) dollars. Executive shall submit to
any physical examinations necessary to obtain such policies and shall otherwise
cooperate with the Corporation in obtaining such insurance coverage. Any
insurance policy maintained by the Corporation on the life of Executive pursuant
to this Section 5(b) shall be made payable to such beneficiary or beneficiaries
as Executive may designate by written notice to the Corporation and the
Corporation
-4-
<PAGE>
agrees, promptly upon receipt of such notice, to take all such action as may be
necessary so as to notify the appropriate insurance company of any change of
beneficiary.
6. Reimbursement of Expenses. The Corporation shall reimburse
Executive in accordance with applicable policies of the Corporation for all
expenses reasonably incurred by him in connection with the performance of his
duties hereunder and the business of the Corporation, including expenses
relating to the operation and maintenance of a motor vehicle (including, but not
limited to, vehicle loan and lease payments, insurance premiums, parking,
gasoline and repair expenditures) upon the submission to the Corporation of
appropriate receipts or vouchers.
7. Facilities and Personnel. Executive shall be provided a
private office, secretarial services and such other facilities, supplies,
personnel and services as shall be required or reasonably requested for the
performance of his duties hereunder.
8. Vacation. Executive shall be entitled to four (4) weeks'
paid vacation in respect of each twelve (12) month period during the Term, such
vacation to be taken at times mutually agreeable to Executive and the Board of
Directors and in accordance with the Corporation's vacation policy.
9. Restrictive Covenant. In consideration of the Corporation's
entering into this Agreement, Executive agrees that during the Term, he will not
(i) directly or indirectly own, manage, operate, join, control, participate in,
invest in, or
-5-
<PAGE>
otherwise be connected with, in any manner, whether as an officer, director,
employee, partner, investor or otherwise, any business entity that is engaged in
the business of hotel renovation, procurement of hotel furniture, fixtures and
equipment, procurement and reordering of hotel operating supplies and equipment,
the development of hotel properties or any other business which the Corporation
is then engaged in, (ii) for himself or on behalf of any other person,
partnership, corporation or entity, call on any customer of the Corporation for
the purpose of soliciting, diverting or taking away any customer from the
Corporation, or (iii) induce, influence, or seek to induce or influence, any
person engaged as an employee, representative, agent, independent contractor or
otherwise by the Corporation, to terminate his or her relationship with the
Corporation. Nothing herein contained shall be deemed to prohibit Executive from
investing his funds in securities of an issuer if the securities of such issuer
are listed for trading on a national securities exchange or are traded in the
over-the-counter market and Executive's holdings therein represent less than 1%
of the total number of shares or principal amount of the securities of such
issuer outstanding.
Executive acknowledges that the provisions of this Section 9
are reasonable and necessary for the protection of the Corporation, and that
each provision, and the period or periods of time, geographic areas and types
and scope of restrictions on the activities specified herein are, and are
intended to be, divisible. If any provision of this Section 9, including any
sentence, clause
-6-
<PAGE>
or part hereof, shall be deemed contrary to law or invalid or unenforceable in
any respect by a court of competent jurisdiction, the remaining provisions shall
not be affected, but shall, subject to the discretion of such court, remain in
full force and effect and any invalid and unenforceable provisions shall be
deemed, without further action on the part of the parties hereto, modified,
amended and limited to the extent necessary to render the same valid and
enforceable.
10. Confidential Information. Executive shall hold in a
fiduciary capacity for the benefit of the Corporation all information, knowledge
and data relating to or concerned with its operations, sales, business and
affairs, and he shall not, at any time for a period of two (2) years after
termination of his employment hereunder, use, disclose or divulge any such
information, knowledge or data to any person, firm or corporation (unless the
Corporation no longer treats such information as confidential) other than to the
Corporation or its designees and employees or except as may otherwise be
required in connection with the business and affairs of the Corporation;
provided, however, that Executive may disclose or divulge such information,
knowledge or data that (i) was known to Executive at the commencement of his
employment with the Corporation; (ii) is or becomes generally available to the
public through no wrongful act on Executive's part; or (iii) becomes available
to Executive from a person or entity other than the Corporation; and provided,
further, that the provisions of this Section 10 shall not apply to Executive's
know-
-7-
<PAGE>
how to the extent utilized by him in subsequent employment otherwise than in
breach of this Agreement.
11. Intellectual Property. Any idea, invention, design,
written material, manual, system, procedure, improvement, development or
discovery conceived, developed, created or made by Executive alone or with
others, during the Term and applicable to the business of the Corporation,
whether or not patentable or registrable, shall become the sole and exclusive
property of the Corporation. Executive shall disclose the same promptly and
completely to the Corporation and shall, during the Term and at any time and
from time to time hereafter (i) execute all documents requested by the
Corporation for vesting in the Corporation the entire right, title and interest
in and to the same, (ii) execute all documents requested by the Corporation for
filing and prosecuting such applications for patents, trademarks, service marks
and/or copyrights as the Corporation, in its sole discretion, may desire to
prosecute, and (iii) give the Corporation all assistance it reasonably requires,
including the giving of testimony in any suit, action or proceeding, in order to
obtain, maintain and protect the Corporation's right therein and thereto.
12. Equitable Relief. The parties hereto acknowledge that
Executive's services are unique and that, in the event of a breach or a
threatened breach by Executive of any of his obligations under this Agreement,
the Corporation shall not have an adequate remedy at law. Accordingly, in the
event of any such breach or threatened breach by Executive, the Corporation
shall be
-8-
<PAGE>
entitled to such equitable and injunctive relief as may be available to restrain
Executive and any business, firm, partnership, individual, corporation or entity
participating in such breach or threatened breach from the violation of the
provisions hereof. Nothing herein shall be construed as prohibiting the
Corporation from pursuing any other remedies available at law or in equity for
such breach or threatened breach, including the recovery of damages and the
immediate termination of the employment of Executive hereunder.
13. Termination for Cause. (a) The Corporation may at any time
dismiss Executive for "Cause." For purposes of this Agreement, the following
shall constitute "Cause": (i) the death of Executive; or (ii) the failure of
Executive, as a result of illness, physical or mental disability or other
incapacity to render the services provided in this Agreement for a period of one
hundred eighty (180) consecutive days or one hundred eighty (180) days during
any one (1) year period ("Disability"); or (iii) the breach by Executive of a
fiduciary duty in the performance of his duties hereunder or a breach of a
material term of this Agreement, including (x) theft, embezzlement, fraud,
misappropriation of funds, other acts of dishonesty or the violation of any law
relating to Executive's employment; (y) Executive shall have entered a plea of
guilty or nolo contendre to, or have been found by a court of competent
jurisdiction to be guilty of a felony or other crime involving moral turpitude;
and (z) the breach by Executive of any other material provision of this
Agreement, which
-9-
<PAGE>
breach is not cured to the Corporation's reasonable satisfaction within thirty
(30) days after written notice thereof; or (iv) the failure by Executive to
carry out any reasonable directive of the Board of Directors commensurate with
Executive's duties hereunder, which failure shall continue for thirty (30) days
after written notice thereof.
(b) In the event of Executive's Disability, he shall be
entitled to receive the Base Salary payments due under Section 4 hereof during
the period of his Disability and for a period of eighteen (18) months
thereafter.
(c) In the event of termination of Executive's employment
hereunder by reason of his death, the Corporation shall pay a benefit (the
"Benefit Payment") to such person or persons as Executive shall, at his option,
from time to time designate by written instrument delivered to the Corporations,
each subsequent designation to revoke all prior designations, or if no such
designation is made, to Executive's estate (the "Payment Beneficiary"). The
Benefit Payment shall be in an amount equal to one and one-half times
Executive's then current Base Salary, and shall be payable to the Payment
Beneficiary in equal quarterly installments over a period of one and one-half
years, provided that if the Corporation then maintains a life insurance policy
on the life of Executive under which it is the beneficiary, the amount of the
death benefit payable thereunder, to a maximum amount equal to the Benefit
Payment, less installments of the Benefit Payment theretofore paid, shall be
paid to the Payment Beneficiary on the
-10-
<PAGE>
Benefit Payment installment payment date next succeeding the date on which the
Corporation receives such death benefit proceeds, and the remainder of the
Benefit Payment, if any, shall be paid in equal quarterly installments as
provided above.
14. Change of Control. (a) If prior to termination of this
Agreement, there should be a "Change of Control," as defined in Section 14(b)
below, the Executive may terminate his employment and this Agreement at any time
after the earlier to occur of (A) one year after the Change of Control or (B)
the occurrence of any of the following: (i) Executive's services should be
terminated for any reason other than Executive's voluntary withdrawal or Cause,
or (ii) Executive is placed in any position of lesser stature than that of a
senior executive officer of the Corporation; is assigned duties inconsistent
with a senior executive officer or duties which, if performed, would result in a
significant change in the nature or scope of powers, authority, functions or
duties inherent in such position on the date hereof; is assigned performance
requirements or working conditions which are at variance with the performance
requirements and working conditions in effect immediately prior to the Change of
Control; or is accorded treatment on a general basis that is in derogation of
his status as a senior executive officer; (iii) any breach of Sections 4 through
8, inclusive, of this Agreement; or (iv) any requirement of the Corporation that
the location at which Executive performs his principal duties for the
Corporation be outside of Manhattan, then upon such one year period or
termination, the Corporation will, on
-11-
<PAGE>
or before Executive's last day of providing service hereunder, pay to Executive,
as liquidated damages, a lump sum cash payment equal to 2.99 times the aggregate
of (i) Base Salary and (ii) the last Bonus earned by Executive (unless the
aggregate of (i) Base Salary and (ii) the last Bonus earned by Executive is
greater than the "base amount" of Executive's compensation, in which case the
amount paid to Executive hereunder shall be 2.99 times the "base amount" of
Executive's compensation). For purposes hereof, "base amount" shall have the
meaning provided in Section 280G(b)(3)(A) of the Internal Revenue Code of 1986,
as amended, and the Proposed Regulations thereunder.
(b) "Change of Control" shall be deemed to have taken place if
(i) any person, including a group, becomes the beneficial owner of shares of the
Corporation sufficient in manner to control the election of directors of the
Corporation; or (ii) there occurs any cash tender or exchange offer for shares
of the Corporation, merger or other business combination, sale of assets or
contested election, or any combination of the foregoing transactions, and as a
result of or in connection with any such event persons who were directors of the
Corporation before the event shall cease to constitute a majority of the Board
of Directors of the Corporation or any successor to the Corporation. As used
herein, the terms "person" and "beneficial owner" have the same meaning as such
terms under Section 13 (d) of the Securities Exchange Act of 1934, as amended,
and the rules and regulations hereunder.
-12-
<PAGE>
15. Insurance Policies. The Corporation shall have the right
from time to time to purchase, increase, modify or terminate insurance policies
on the life of Executive for the benefit of the Corporation, in such amounts as
the Corporation shall determine in its sole discretion. In connection therewith,
Executive shall, at such time or times and at such place or places as the
Corporation may reasonably direct, submit himself to such physical examinations
and execute and deliver such documents as the Corporation may deem necessary or
desirable.
16. Entire Agreement; Amendment. This Agreement constitutes
the entire agreement of the parties hereto, and any prior agreement between the
Corporation and Executive is hereby superseded and terminated effective
immediately and shall be without further force or effect. No amendment or
modification shall be valid or binding unless made in writing and signed by the
party against whom enforcement thereof is sought.
17. Notices. Any notice required, permitted or desired to be
given pursuant to any of the provisions of this Agreement shall be deemed to
have been sufficiently given or served for all purposes if delivered in person
or by responsible overnight delivery service or sent by certified mail, return
receipt requested, postage and fees prepaid as follows:
If to the Corporation, at its address set forth above,
with copies to:
Olshan Grundman Frome & Rosenzweig LLP
505 Park Avenue
New York, New York 10022
Attention: Robert H. Friedman, Esq.
-13-
<PAGE>
If to Executive, at his address set forth above.
Either of the parties hereto may at any time and from time to time change the
address to which notice shall be sent hereunder by notice to the other party
given under this Section 17. The date of the giving of any notice hand delivered
or delivered by responsible overnight carrier shall be the date of its delivery
and of any notice sent by mail shall be the date five days after the date of the
posting of the mail.
18. No Assignment; Binding Effect. Neither this Agreement, nor
the right to receive any payments hereunder, may be assigned by Executive. This
Agreement shall be binding upon Executive, his heirs, executors and
administrators and upon the Corporation, its successors and assigns.
19. Waivers. No course of dealing nor any delay on the part of
the Corporation in exercising any rights hereunder shall operate as a waiver of
any such rights. No waiver of any default or breach of this Agreement shall be
deemed a continuing waiver or a waiver of any other breach or default.
20. Governing Law. This Agreement shall be governed,
interpreted and construed in accordance with the laws of the State of New York,
except that body of law relating to choice of laws.
21. Invalidity. If any clause, paragraph, section or part of
this Agreement shall be held or declared to be void, invalid or illegal, for any
reason, by any court of competent jurisdiction, such provision shall be
ineffective but shall not in
-14-
<PAGE>
any way invalidate or affect any other clause, paragraph, section or part of
this Agreement.
22. Further Assurances. Each of the parties shall execute such
documents and take such other actions as may be reasonably requested by the
other party to carry out the provisions and purposes of this Agreement in
accordance with its terms.
IN WITNESS WHEREOF, the parties hereto have caused this
Employment Agreement to be duly executed as of the day and year first above
written.
HOSPITALITY WORLDWIDE SERVICES, INC.
By: /S/ Howard G. Anders
----------------------------------
Name: Howard G. Anders
Title: Senior Vice President
and Chief Financial
Officer
/S/ ROBERT BERMAN
--------------------------------------------
ROBERT BERMAN
Mr. George Asch
Gray Seifert
380 Madison Avenue
22nd Floor
New York, New York
-15-
EMPLOYMENT AGREEMENT
AGREEMENT made as of this 1st day of January, 1998, by and
between HOSPITALITY WORLDWIDE SERVICES, INC., a New York corporation with its
principal office at 450 Park Avenue, New York, New York 10022 (the
"Corporation"), and HOWARD ANDERS, residing at 30 East 65th Street, Apt. 15C,
New York, New York 10021 ("Executive").
W I T N E S S E T H :
WHEREAS, Executive has heretofore been employed pursuant to an
employment agreement dated as of April 1, 1996 between the Corporation and
Executive (the "Prior Agreement");
WHEREAS, Executive and the Corporation desire to enter into a
new employment agreement that supersedes and replaces the Prior Agreement;
WHEREAS, the Corporation desires to continue to employ
Executive, and Executive is willing to undertake such employment, upon the terms
and subject to the conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants hereinafter set forth, the parties hereto agree as follows:
1. Employment of Executive. The Corporation hereby employs
Executive as its Executive Vice President and Chief Financial Officer, to
perform the duties and responsibilities incident to such offices, subject at all
times to the control and direction of the Board of Directors of the Corporation
(the "Board
<PAGE>
of Directors") and the Chief Executive Officer of the Corporation (the "CEO").
2. Acceptance of Employment; Time and Attention. Executive
hereby accepts such employment and agrees that throughout the Term (as
hereinafter defined), he will devote his full time, attention, knowledge and
skills, faithfully, diligently and to the best of his ability, in furtherance of
the business of the Corporation, and will perform the duties assigned to him
pursuant to Section 1 hereof, subject, at all times, to the direction and
control of the Board of Directors and the CEO. As the Executive Vice President
and Chief Financial Officer, Executive shall perform such specific duties and
shall exercise such specific authority as may be assigned to Executive from time
to time by the Board of Directors and the CEO. Executive shall at all times be
subject to, observe and carry out such rules, regulations, policies, directions
and restrictions as the Corporation shall from time to time establish. During
the Term, Executive shall not, without the written approval of the Board of
Directors first had and obtained in each instance, directly or indirectly,
accept employment or compensation from, or perform services of any nature for,
any business enterprise other than the Corporation and its subsidiaries. During
the Term, Executive shall not be entitled to additional compensation for
rendering employment services to subsidiaries of the Company or for serving in
any office of the Corporation or any of its subsidiaries to which he is elected
or appointed.
-2-
<PAGE>
3. Term. Except as otherwise provided herein, Executive's
employment hereunder shall be for a three (3) year term commencing as of January
1, 1998 (the "Initial Term"), which may be renewed for such one (1) year periods
as the Corporation and Executive may mutually agree during the ninety (90) day
period immediately prior to the expiration of the Initial Term or any renewal
thereof (the Initial Term and any such renewal thereof are hereinafter
collectively referred to as the "Term").
4. Compensation. The Corporation shall pay to the Executive,
commencing as of January 1, 1998, for the first year of his employment,
compensation at the rate of two hundred twenty-five thousand ($225,000) dollars
per year ("Base Salary"). For each year thereafter, the Base Salary will be
increased by (i) the percentage increase in the consumer price index (the "CPI")
for the New York/Northeastern New Jersey region, published by the United States
Department of Labor, at January 1 of such year over the CPI at January 1 of the
prior year or (ii) such higher amount as shall be determined by the Board of
Directors. Such compensation shall be payable in equal monthly installments. In
addition, Executive shall be entitled to receive from the Corporation such bonus
(the "Bonus") as the Board of Directors shall in its sole discretion determine.
All compensation paid to Executive shall be subject to withholding and other
employment taxes imposed by applicable law.
5. Additional Benefits. (a) In addition to such Base Salary,
he (and his family) shall be entitled to participate, to the extent he is (and
they are) eligible under the terms and
-3-
<PAGE>
conditions thereof, in any profit-sharing, pension, retirement, hospitalization,
insurance, disability, medical service, stock option, bonus or other employee
benefit plan generally available to the executive officers of the Corporation
that may be in effect from time to time during the Term, as well as any
discretionary bonus pool of the Corporation. The Corporation shall be under no
obligation to institute or continue the existence of any such employee benefit
plan.
(b) The Corporation shall obtain and maintain in full force
and effect during the Term, at the Corporation's sole cost and expense, a policy
or policies of term insurance on the life of Executive in the aggregate face
amount of five hundred thousand ($500,000) dollars. Executive shall submit to
any physical examinations necessary to obtain such policies and shall otherwise
cooperate with the Corporation in obtaining such insurance coverage. Any
insurance policy maintained by the Corporation on the life of Executive pursuant
to this Section 5(b) shall be made payable to such beneficiary or beneficiaries
as Executive may designate by written notice to the Corporation and the
Corporation agrees, promptly upon receipt of such notice, to take all such
action as may be necessary so as to notify the appropriate insurance company of
any change of beneficiary.
6. Reimbursement of Expenses. The Corporation shall reimburse
Executive in accordance with applicable policies of the Corporation for all
expenses, including automobile expenses, reasonably incurred by him in
connection with the performance of
-4-
<PAGE>
his duties hereunder and the business of the Corporation, upon the submission to
the Corporation of appropriate receipts or vouchers.
7. Facilities and Personnel. Executive shall be provided a
private office, secretarial services and such other facilities, supplies,
personnel and services as shall be required or reasonably requested for the
performance of his duties hereunder.
8. Vacation. Executive shall be entitled to four (4) weeks'
paid vacation in respect of each twelve (12) month period during the Term, such
vacation to be taken at times mutually agreeable to Executive and the Board of
Directors and in accordance with the Corporation's vacation policy. Unused
vacation shall be carried over to the subsequent twelve (12) month period.
9. Restrictive Covenant. In consideration of the Corporation's
entering into this Agreement, Executive agrees that during the Term, he will not
(i) directly or indirectly own, manage, operate, join, control, participate in,
invest in, or otherwise be connected with, in any manner, whether as an officer,
director, employee, partner, investor or otherwise, any business entity that is
engaged in the business of hotel renovation, procurement of hotel furniture,
fixtures and equipment, procurement and reordering of hotel operating supplies
and equipment, the development of hotel properties or any other business which
the Corporation is then engaged in, (ii) for himself or on behalf of any other
person, partnership, corporation or entity, call on any
-5-
<PAGE>
customer of the Corporation for the purpose of soliciting, diverting or taking
away any customer from the Corporation, or (iii) induce, influence, or seek to
induce or influence, any person engaged as an employee, representative, agent,
independent contractor or otherwise by the Corporation, to terminate his or her
relationship with the Corporation. Nothing herein contained shall be deemed to
prohibit Executive from investing his funds in securities of an issuer if the
securities of such issuer are listed for trading on a national securities
exchange or are traded in the over-the-counter market and Executive's holdings
therein represent less than 1% of the total number of shares or principal amount
of the securities of such issuer outstanding.
Executive acknowledges that the provisions of this Section 9
are reasonable and necessary for the protection of the Corporation, and that
each provision, and the period or periods of time, geographic areas and types
and scope of restrictions on the activities specified herein are, and are
intended to be, divisible. If any provision of this Section 9, including any
sentence, clause or part hereof, shall be deemed contrary to law or invalid or
unenforceable in any respect by a court of competent jurisdiction, the remaining
provisions shall not be affected, but shall, subject to the discretion of such
court, remain in full force and effect and any invalid and unenforceable
provisions shall be deemed, without further action on the part of the parties
hereto, modified, amended and limited to the extent necessary to render the same
valid and enforceable.
-6-
<PAGE>
10. Confidential Information. Executive shall hold in a
fiduciary capacity for the benefit of the Corporation all information, knowledge
and data relating to or concerned with its operations, sales, business and
affairs, and he shall not, at any time for a period of two (2) years after
termination of his employment hereunder, use, disclose or divulge any such
information, knowledge or data to any person, firm or corporation (unless the
Corporation no longer treats such information as confidential) other than to the
Corporation or its designees and employees or except as may otherwise be
required in connection with the business and affairs of the Corporation;
provided, however, that Executive may disclose or divulge such information,
knowledge or data that (i) was known to Executive at the commencement of his
employment with the Corporation; (ii) is or becomes generally available to the
public through no wrongful act on Executive's part; or (iii) becomes available
to Executive from a person or entity other than the Corporation; and provided,
further, that the provisions of this Section 10 shall not apply to Executive's
know-how to the extent utilized by him in subsequent employment otherwise than
in breach of this Agreement.
11. Intellectual Property. Any idea, invention, design,
written material, manual, system, procedure, improvement, development or
discovery conceived, developed, created or made by Executive alone or with
others, during the Term and applicable to the business of the Corporation,
whether or not patentable or registrable, shall become the sole and exclusive
property of the
-7-
<PAGE>
Corporation. Executive shall disclose the same promptly and completely to the
Corporation and shall, during the Term and at any time and from time to time
hereafter (i) execute all documents requested by the Corporation for vesting in
the Corporation the entire right, title and interest in and to the same, (ii)
execute all documents requested by the Corporation for filing and prosecuting
such applications for patents, trademarks, service marks and/or copyrights as
the Corporation, in its sole discretion, may desire to prosecute, and (iii) give
the Corporation all assistance it reasonably requires, including the giving of
testimony in any suit, action or proceeding, in order to obtain, maintain and
protect the Corporation's right therein and thereto.
12. Equitable Relief. The parties hereto acknowledge that
Executive's services are unique and that, in the event of a breach or a
threatened breach by Executive of any of his obligations under this Agreement,
the Corporation shall not have an adequate remedy at law. Accordingly, in the
event of any such breach or threatened breach by Executive, the Corporation
shall be entitled to such equitable and injunctive relief as may be available to
restrain Executive and any business, firm, partnership, individual, corporation
or entity participating in such breach or threatened breach from the violation
of the provisions hereof. Nothing herein shall be construed as prohibiting the
Corporation from pursuing any other remedies available at law or in equity for
such breach or threatened breach,
-8-
<PAGE>
including the recovery of damages and the immediate termination of the
employment of Executive hereunder.
13. Termination for Cause. (a) The Corporation may at any time
dismiss Executive for "Cause." For purposes of this Agreement, the following
shall constitute "Cause": (i) the death of Executive; or (ii) the failure of
Executive, as a result of illness, physical or mental disability or other
incapacity to render the services provided in this Agreement for a period of one
hundred eighty (180) consecutive days or one hundred eighty (180) days during
any one (1) year period ("Disability"); or (iii) the breach by Executive of a
fiduciary duty in the performance of his duties hereunder or a breach of a
material term of this Agreement, including (x) theft, embezzlement, fraud,
misappropriation of funds, other acts of dishonesty or the violation of any law
relating to Executive's employment; (y) Executive shall have entered a plea of
guilty or nolo contendre to, or have been found by a court of competent
jurisdiction to be guilty of a felony or other crime involving moral turpitude;
and (z) the breach by Executive of any other material provision of this
Agreement, which breach is not cured to the Corporation's reasonable
satisfaction within thirty (30) days after written notice thereof; or (iv) the
failure by Executive to carry out any reasonable directive of the Board of
Directors commensurate with Executive's duties hereunder, which failure shall
continue for thirty (30) days after written notice thereof.
-9-
<PAGE>
(b) In the event of Executive's Disability, he shall be
entitled to receive so much of the Base Salary payments due under Section 4
hereof during the period of his Disability and for a period of eighteen (18)
months thereafter.
(c) In the event of termination of Executive's employment
hereunder by reason of his death, the Corporation shall pay a benefit (the
"Benefit Payment") to such person or persons as Executive shall, at his option,
from time to time designate by written instrument delivered to the Corporations,
each subsequent designation to revoke all prior designations, or if no such
designation is made, to Executive's estate (the "Payment Beneficiary"). The
Benefit Payment shall be in an amount equal to one and one-half times
Executive's then current Base Salary, and shall be payable to the Payment
Beneficiary in equal quarterly installments over a period of one and one-half
years, provided that if the Corporation then maintains a life insurance policy
on the life of Executive under which it is the beneficiary, the amount of the
death benefit payable thereunder, to a maximum amount equal to the Benefit
Payment, less installments of the Benefit Payment theretofore paid, shall be
paid to the Payment Beneficiary on the Benefit Payment installment payment date
next succeeding the date on which the Corporation receives such death benefit
proceeds, and the remainder of the Benefit Payment, if any, shall be paid in
equal quarterly installments as provided above.
14. Change of Control. (a) If prior to termination of
this Agreement, there should be a "Change of Control," as defined
-10-
<PAGE>
in Section 14(b) below, and thereafter (i) Executive's services should be
terminated for any reason other than Executive's voluntary withdrawal or Cause,
or (ii) Executive is placed in any position of lesser stature than that of a
senior executive officer of the Corporation; is assigned duties inconsistent
with a senior executive officer or duties which, if performed, would result in a
significant change in the nature or scope of powers, authority, functions or
duties inherent in such position on the date hereof; is assigned performance
requirements or working conditions which are at variance with the performance
requirements and working conditions in effect immediately prior to the Change of
Control; or is accorded treatment on a general basis that is in derogation of
his status as a senior executive officer; (iii) any breach of Sections 4 through
8, inclusive, of this Agreement; or (iv) any requirement of the Corporation that
the location at which Executive performs his principal duties for the
Corporation be outside a radius of 30 miles from the location at which Executive
performed such duties immediately prior to the Change of Control, then the
Executive may terminate his employment and this Agreement and upon such
termination, the Corporation will pay to Executive, as liquidated damages, a
lump sum cash payment equal to 2.99 times Base Salary (unless Base Salary is
greater than the "base amount" of Executive's compensation, in which case the
amount paid to Executive hereunder shall be 2.99 times the "base amount" of
Executive's compensation). For purposes hereof, "base amount" shall have the
meaning provided in Section 280G(b)(3)(A) of the
-11-
<PAGE>
Internal Revenue Code of 1986, as amended, and the Proposed Regulations
thereunder.
(b) "Change of Control" shall be deemed to have taken place if
(i) any person, including a group, becomes the beneficial owner of shares of the
Corporation having 50% or more of the total number of votes that may be cast for
the election of directors of the Corporation; or (ii) there occurs any cash
tender or exchange offer for shares of the Corporation, merger or other business
combination, sale of assets or contested election, or any combination of the
foregoing transactions, and as a result of or in connection with any such event
persons who were directors of the Corporation before the event shall cease to
constitute a majority of the Board of Directors of the Corporation or any
successor to the Corporation. As used herein, the terms "person" and "beneficial
owner" have the same meaning as such terms under Section 13 (d) of the
Securities Exchange Act of 1934, as amended, and the rules and regulations
hereunder.
15. Insurance Policies. The Corporation shall have the right
from time to time to purchase, increase, modify or terminate insurance policies
on the life of Executive for the benefit of the Corporation, in such amounts as
the Corporation shall determine in its sole discretion. In connection therewith,
Executive shall, at such time or times and at such place or places as the
Corporation may reasonably direct, submit himself to such physical examinations
and execute and deliver such documents as the Corporation may deem necessary or
desirable.
-12-
<PAGE>
16. Entire Agreement; Amendment. This Agreement constitutes
the entire agreement of the parties hereto, and any prior agreement between the
Corporation and Executive is hereby superseded and terminated effective
immediately and shall be without further force or effect. No amendment or
modification shall be valid or binding unless made in writing and signed by the
party against whom enforcement thereof is sought.
17. Notices. Any notice required, permitted or desired to be
given pursuant to any of the provisions of this Agreement shall be deemed to
have been sufficiently given or served for all purposes if delivered in person
or by responsible overnight delivery service or sent by certified mail, return
receipt requested, postage and fees prepaid as follows:
If to the Corporation, at its address set forth
above, with copies to:
Olshan Grundman Frome & Rosenzweig LLP
505 Park Avenue
New York, New York 10022
Attention: Robert H. Friedman, Esq.
If to Executive, at his address set forth above.
Either of the parties hereto may at any time and from time to time change the
address to which notice shall be sent hereunder by notice to the other party
given under this Section 17. The date of the giving of any notice hand delivered
or delivered by responsible overnight carrier shall be the date of its delivery
and of any notice sent by mail shall be the date five days after the date of the
posting of the mail.
-13-
<PAGE>
18. No Assignment; Binding Effect. Neither this Agreement, nor
the right to receive any payments hereunder, may be assigned by Executive. This
Agreement shall be binding upon Executive, his heirs, executors and
administrators and upon the Corporation, its successors and assigns.
19. Waivers. No course of dealing nor any delay on the part of
the Corporation in exercising any rights hereunder shall operate as a waiver of
any such rights. No waiver of any default or breach of this Agreement shall be
deemed a continuing waiver or a waiver of any other breach or default.
20. Governing Law. This Agreement shall be governed,
interpreted and construed in accordance with the laws of the State of New York,
except that body of law relating to choice of laws.
21. Invalidity. If any clause, paragraph, section or part of
this Agreement shall be held or declared to be void, invalid or illegal, for any
reason, by any court of competent jurisdiction, such provision shall be
ineffective but shall not in any way invalidate or affect any other clause,
paragraph, section or part of this Agreement.
22. Further Assurances. Each of the parties shall execute such
documents and take such other actions as may be reasonably requested by the
other party to carry out the provisions and purposes of this Agreement in
accordance with its terms.
-14-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Employment Agreement to be duly executed as of the day and year first above
written.
HOSPITALITY WORLDWIDE SERVICES, INC.
By: /s/ Robert Berman
------------------------------------
Name: Robert Berman
Title: Chairman of the Board
and Chief Executive
Officer
/s/ HOWARD G. ANDERS
------------------------------------------
HOWARD G. ANDERS
-15-
EMPLOYMENT AGREEMENT
AGREEMENT made as of this 1st day of January, 1998, by and
between HOSPITALITY WORLDWIDE SERVICES, INC., a New York corporation with its
principal office at 450 Park Avenue, New York, New York 10022 (the
"Corporation"), and DOUGLAS PARKER, residing at 4140 Pinta Court, Coral Gables,
Florida 33146 ("Executive").
W I T N E S S E T H :
WHEREAS, Executive has heretofore been employed pursuant to an
employment agreement dated as of January 9, 1997 between The Leonard Parker
Company and Executive (the "Prior Agreement");
WHEREAS, Executive and the Corporation desire to enter into a
new employment agreement that supersedes and replaces the Prior Agreement;
WHEREAS, the Corporation desires to continue to employ
Executive, and Executive is willing to undertake such employment, upon the terms
and subject to the conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants hereinafter set forth, the parties hereto agree as follows:
1. Employment of Executive. The Corporation hereby employs
Executive as its President, to perform the duties and responsibilities incident
to such offices, subject at all times to the control and direction of the Board
of Directors of the Corporation (the "Board of Directors") and the Chief
Executive Officer of the Corporation (the "CEO").
<PAGE>
2. Acceptance of Employment; Time and Attention. Executive
hereby accepts such employment and agrees that throughout the Term (as
hereinafter defined), he will devote his full time, attention, knowledge and
skills, faithfully, diligently and to the best of his ability, in furtherance of
the business of the Corporation, and will perform the duties assigned to him
pursuant to Section 1 hereof, subject, at all times, to the direction and
control of the Board of Directors and the CEO. As the President, Executive shall
perform such specific duties and shall exercise such specific authority as may
be assigned to Executive from time to time by the Board of Directors and the
CEO. Executive shall at all times be subject to, observe and carry out such
rules, regulations, policies, directions and restrictions as the Corporation
shall from time to time establish. During the Term, Executive shall not, without
the written approval of the Board of Directors first had and obtained in each
instance, directly or indirectly, accept employment or compensation from, or
perform services of any nature for, any business enterprise other than the
Corporation and its subsidiaries. During the Term, Executive shall not be
entitled to additional compensation for rendering employment services to
subsidiaries of the Company or for serving in any office of the Corporation or
any of its subsidiaries to which he is elected or appointed.
3. Term. Except as otherwise provided herein, Executive's
employment hereunder shall be for a two (2) year term commencing as of January
1, 1998 (the "Initial Term"), which may be
-2-
<PAGE>
renewed for such one (1) year periods as the Corporation and Executive may
mutually agree during the ninety (90) day period immediately prior to the
expiration of the Initial Term or any renewal thereof (the Initial Term and any
such renewal thereof are hereinafter collectively referred to as the "Term").
4. Compensation. The Corporation shall pay to the Executive,
commencing as of January 1, 1998, for the first year of his employment,
compensation at the rate of two hundred fifty thousand ($250,000) dollars per
year ("Base Salary"). For each year thereafter, the Base Salary will be
increased by (i) the percentage increase in the consumer price index (the "CPI")
for the New York/Northeastern New Jersey region, published by the United States
Department of Labor, at January 1 of such year over the CPI at January 1 of the
prior year or (ii) such higher amount as shall be determined by the Board of
Directors. Such compensation shall be payable in equal monthly installments. In
addition, Executive shall be entitled to receive from the Corporation such bonus
(the "Bonus") as the Board of Directors shall in its sole discretion determine.
All compensation paid to Executive shall be subject to withholding and other
employment taxes imposed by applicable law.
5. Additional Benefits. (a) In addition to such Base Salary,
he (and his family) shall be entitled to participate, to the extent he is (and
they are) eligible under the terms and conditions thereof, in any
profit-sharing, pension, retirement, hospitalization, insurance, disability,
medical service, stock option, bonus or other employee benefit plan generally
available to
-3-
<PAGE>
the executive officers of the Corporation that may be in effect from time to
time during the Term, as well as any discretionary bonus pool of the
Corporation. The Corporation shall be under no obligation to institute or
continue the existence of any such employee benefit plan.
(b) The Corporation shall obtain and maintain in full force
and effect during the Term, at the Corporation's sole cost and expense, a policy
or policies of term insurance on the life of Executive in the aggregate face
amount of five hundred thousand ($500,000) dollars. Executive shall submit to
any physical examinations necessary to obtain such policies and shall otherwise
cooperate with the Corporation in obtaining such insurance coverage. Any
insurance policy maintained by the Corporation on the life of Executive pursuant
to this Section 5(b) shall be made payable to such beneficiary or beneficiaries
as Executive may designate by written notice to the Corporation and the
Corporation agrees, promptly upon receipt of such notice, to take all such
action as may be necessary so as to notify the appropriate insurance company of
any change of beneficiary.
6. Reimbursement of Expenses. The Corporation shall reimburse
Executive in accordance with applicable policies of the Corporation for all
expenses, including automobile expenses, reasonably incurred by him in
connection with the performance of his duties hereunder and the business of the
Corporation, upon the submission to the Corporation of appropriate receipts or
vouchers.
-4-
<PAGE>
7. Facilities and Personnel. Executive shall be provided a
private office, secretarial services and such other facilities, supplies,
personnel and services as shall be required or reasonably requested for the
performance of his duties hereunder.
8. Vacation. Executive shall be entitled to four (4) weeks'
paid vacation in respect of each twelve (12) month period during the Term, such
vacation to be taken at times mutually agreeable to Executive and the Board of
Directors and in accordance with the Corporation's vacation policy. Unused
vacation shall be carried over to the subsequent twelve (12) month period.
9. Restrictive Covenant. In consideration of the Corporation's
entering into this Agreement, Executive agrees that during the Term, he will not
(i) directly or indirectly own, manage, operate, join, control, participate in,
invest in, or otherwise be connected with, in any manner, whether as an officer,
director, employee, partner, investor or otherwise, any business entity that is
engaged in the business of hotel renovation, procurement of hotel furniture,
fixtures and equipment, procurement and reordering of hotel operating supplies
and equipment, the development of hotel properties or any other business which
the Corporation is then engaged in, (ii) for himself or on behalf of any other
person, partnership, corporation or entity, call on any customer of the
Corporation for the purpose of soliciting, diverting or taking away any customer
from the Corporation, or (iii) induce, influence, or seek to induce or
influence, any person
-5-
<PAGE>
engaged as an employee, representative, agent, independent contractor or
otherwise by the Corporation, to terminate his or her relationship with the
Corporation. Nothing herein contained shall be deemed to prohibit Executive from
investing his funds in securities of an issuer if the securities of such issuer
are listed for trading on a national securities exchange or are traded in the
over-the-counter market and Executive's holdings therein represent less than 1%
of the total number of shares or principal amount of the securities of such
issuer outstanding.
Executive acknowledges that the provisions of this Section 9
are reasonable and necessary for the protection of the Corporation, and that
each provision, and the period or periods of time, geographic areas and types
and scope of restrictions on the activities specified herein are, and are
intended to be, divisible. If any provision of this Section 9, including any
sentence, clause or part hereof, shall be deemed contrary to law or invalid or
unenforceable in any respect by a court of competent jurisdiction, the remaining
provisions shall not be affected, but shall, subject to the discretion of such
court, remain in full force and effect and any invalid and unenforceable
provisions shall be deemed, without further action on the part of the parties
hereto, modified, amended and limited to the extent necessary to render the same
valid and enforceable.
10. Confidential Information. Executive shall hold in a
fiduciary capacity for the benefit of the Corporation all information, knowledge
and data relating to or concerned with its
-6-
<PAGE>
operations, sales, business and affairs, and he shall not, at any time for a
period of two (2) years after termination of his employment hereunder, use,
disclose or divulge any such information, knowledge or data to any person, firm
or corporation (unless the Corporation no longer treats such information as
confidential) other than to the Corporation or its designees and employees or
except as may otherwise be required in connection with the business and affairs
of the Corporation; provided, however, that Executive may disclose or divulge
such information, knowledge or data that (i) was known to Executive at the
commencement of his employment with the Corporation; (ii) is or becomes
generally available to the public through no wrongful act on Executive's part;
or (iii) becomes available to Executive from a person or entity other than the
Corporation; and provided, further, that the provisions of this Section 10 shall
not apply to Executive's know-how to the extent utilized by him in subsequent
employment otherwise than in breach of this Agreement.
11. Intellectual Property. Any idea, invention, design,
written material, manual, system, procedure, improvement, development or
discovery conceived, developed, created or made by Executive alone or with
others, during the Term and applicable to the business of the Corporation,
whether or not patentable or registrable, shall become the sole and exclusive
property of the Corporation. Executive shall disclose the same promptly and
completely to the Corporation and shall, during the Term and at any time and
from time to time hereafter (i) execute all documents
-7-
<PAGE>
requested by the Corporation for vesting in the Corporation the entire right,
title and interest in and to the same, (ii) execute all documents requested by
the Corporation for filing and prosecuting such applications for patents,
trademarks, service marks and/or copyrights as the Corporation, in its sole
discretion, may desire to prosecute, and (iii) give the Corporation all
assistance it reasonably requires, including the giving of testimony in any
suit, action or proceeding, in order to obtain, maintain and protect the
Corporation's right therein and thereto.
12. Equitable Relief. The parties hereto acknowledge that
Executive's services are unique and that, in the event of a breach or a
threatened breach by Executive of any of his obligations under this Agreement,
the Corporation shall not have an adequate remedy at law. Accordingly, in the
event of any such breach or threatened breach by Executive, the Corporation
shall be entitled to such equitable and injunctive relief as may be available to
restrain Executive and any business, firm, partnership, individual, corporation
or entity participating in such breach or threatened breach from the violation
of the provisions hereof. Nothing herein shall be construed as prohibiting the
Corporation from pursuing any other remedies available at law or in equity for
such breach or threatened breach, including the recovery of damages and the
immediate termination of the employment of Executive hereunder.
13. Termination for Cause. (a) The Corporation may at
any time dismiss Executive for "Cause." For purposes of this
-8-
<PAGE>
Agreement, the following shall constitute "Cause": (i) the death of Executive;
or (ii) the failure of Executive, as a result of illness, physical or mental
disability or other incapacity to render the services provided in this Agreement
for a period of one hundred eighty (180) consecutive days or one hundred eighty
(180) days during any one (1) year period ("Disability"); or (iii) the breach by
Executive of a fiduciary duty in the performance of his duties hereunder or a
breach of a material term of this Agreement, including (x) theft, embezzlement,
fraud, misappropriation of funds, other acts of dishonesty or the violation of
any law relating to Executive's employment; (y) Executive shall have entered a
plea of guilty or nolo contendre to, or have been found by a court of competent
jurisdiction to be guilty of a felony or other crime involving moral turpitude;
and (z) the breach by Executive of any other material provision of this
Agreement, which breach is not cured to the Corporation's reasonable
satisfaction within thirty (30) days after written notice thereof; or (iv) the
failure by Executive to carry out any reasonable directive of the Board of
Directors commensurate with Executive's duties hereunder, which failure shall
continue for thirty (30) days after written notice thereof.
(b) In the event of Executive's Disability, he shall be
entitled to receive so much of the Base Salary payments due under Section 4
hereof during the period of his Disability and for a period of eighteen (18)
months thereafter.
-9-
<PAGE>
(c) In the event of termination of Executive's employment
hereunder by reason of his death, the Corporation shall pay a benefit (the
"Benefit Payment") to such person or persons as Executive shall, at his option,
from time to time designate by written instrument delivered to the Corporations,
each subsequent designation to revoke all prior designations, or if no such
designation is made, to Executive's estate (the "Payment Beneficiary"). The
Benefit Payment shall be in an amount equal to one and one-half times
Executive's then current Base Salary, and shall be payable to the Payment
Beneficiary in equal quarterly installments over a period of one and one-half
years, provided that if the Corporation then maintains a life insurance policy
on the life of Executive under which it is the beneficiary, the amount of the
death benefit payable thereunder, to a maximum amount equal to the Benefit
Payment, less installments of the Benefit Payment theretofore paid, shall be
paid to the Payment Beneficiary on the Benefit Payment installment payment date
next succeeding the date on which the Corporation receives such death benefit
proceeds, and the remainder of the Benefit Payment, if any, shall be paid in
equal quarterly installments as provided above.
14. Change of Control. (a) If prior to termination of this
Agreement, there should be a "Change of Control," as defined in Section 14(b)
below, and thereafter (i) Executive's services should be terminated for any
reason other than Executive's voluntary withdrawal or Cause, or (ii) Executive
is placed in any position of lesser stature than that of a senior executive
officer
-10-
<PAGE>
of the Corporation; is assigned duties inconsistent with a senior executive
officer or duties which, if performed, would result in a significant change in
the nature or scope of powers, authority, functions or duties inherent in such
position on the date hereof; is assigned performance requirements or working
conditions which are at variance with the performance requirements and working
conditions in effect immediately prior to the Change of Control; or is accorded
treatment on a general basis that is in derogation of his status as a senior
executive officer; (iii) any breach of Sections 4 through 8, inclusive, of this
Agreement; or (iv) any requirement of the Corporation that the location at which
Executive performs his principal duties for the Corporation be outside a radius
of 30 miles from the location at which Executive performed such duties
immediately prior to the Change of Control, then the Executive may terminate his
employment and this Agreement and upon such termination, the Corporation will
pay to Executive, as liquidated damages, a lump sum cash payment equal to 2.99
times Base Salary (unless Base Salary is greater than the "base amount" of
Executive's compensation, in which case the amount paid to Executive hereunder
shall be 2.99 times the "base amount" of Executive's compensation). For purposes
hereof, "base amount" shall have the meaning provided in Section 280G(b)(3)(A)
of the Internal Revenue Code of 1986, as amended, and the Proposed Regulations
thereunder.
(b) "Change of Control" shall be deemed to have taken
place if (i) any person, including a group, becomes the beneficial
-11-
<PAGE>
owner of shares of the Corporation having 50% or more of the total number of
votes that may be cast for the election of directors of the Corporation; or (ii)
there occurs any cash tender or exchange offer for shares of the Corporation,
merger or other business combination, sale of assets or contested election, or
any combination of the foregoing transactions, and as a result of or in
connection with any such event persons who were directors of the Corporation
before the event shall cease to constitute a majority of the Board of Directors
of the Corporation or any successor to the Corporation. As used herein, the
terms "person" and "beneficial owner" have the same meaning as such terms under
Section 13 (d) of the Securities Exchange Act of 1934, as amended, and the rules
and regulations hereunder.
15. Insurance Policies. The Corporation shall have the right
from time to time to purchase, increase, modify or terminate insurance policies
on the life of Executive for the benefit of the Corporation, in such amounts as
the Corporation shall determine in its sole discretion. In connection therewith,
Executive shall, at such time or times and at such place or places as the
Corporation may reasonably direct, submit himself to such physical examinations
and execute and deliver such documents as the Corporation may deem necessary or
desirable.
16. Entire Agreement; Amendment. This Agreement constitutes
the entire agreement of the parties hereto, and any prior agreement between the
Corporation and Executive is hereby superseded and terminated effective
immediately and shall be
-12-
<PAGE>
without further force or effect. No amendment or modification shall be valid or
binding unless made in writing and signed by the party against whom enforcement
thereof is sought.
17. Notices. Any notice required, permitted or desired to be
given pursuant to any of the provisions of this Agreement shall be deemed to
have been sufficiently given or served for all purposes if delivered in person
or by responsible overnight delivery service or sent by certified mail, return
receipt requested, postage and fees prepaid as follows:
If to the Corporation, at its address set
forth above, with copies to:
Olshan Grundman Frome & Rosenzweig LLP
505 Park Avenue
New York, New York 10022
Attention: Robert H. Friedman, Esq.
If to Executive, at his address set forth above.
Either of the parties hereto may at any time and from time to time change the
address to which notice shall be sent hereunder by notice to the other party
given under this Section 17. The date of the giving of any notice hand delivered
or delivered by responsible overnight carrier shall be the date of its delivery
and of any notice sent by mail shall be the date five days after the date of the
posting of the mail.
18. No Assignment; Binding Effect. Neither this Agreement, nor
the right to receive any payments hereunder, may be assigned by Executive. This
Agreement shall be binding upon
-13-
<PAGE>
Executive, his heirs, executors and administrators and upon the Corporation, its
successors and assigns.
19. Waivers. No course of dealing nor any delay on the part of
the Corporation in exercising any rights hereunder shall operate as a waiver of
any such rights. No waiver of any default or breach of this Agreement shall be
deemed a continuing waiver or a waiver of any other breach or default.
20. Governing Law. This Agreement shall be governed,
interpreted and construed in accordance with the laws of the State of New York,
except that body of law relating to choice of laws.
21. Invalidity. If any clause, paragraph, section or part of
this Agreement shall be held or declared to be void, invalid or illegal, for any
reason, by any court of competent jurisdiction, such provision shall be
ineffective but shall not in any way invalidate or affect any other clause,
paragraph, section or part of this Agreement.
22. Further Assurances. Each of the parties shall execute such
documents and take such other actions as may be reasonably requested by the
other party to carry out the provisions and purposes of this Agreement in
accordance with its terms.
-14-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Employment Agreement to be duly executed as of the day and year first above
written.
HOSPITALITY WORLDWIDE SERVICES, INC.
By: /s/ Robert Berman
------------------------------------
Name: Robert Berman
Title: Chairman of the Board
and Chief Executive
Officer
/s/ DOUGLAS PARKER
--------------------------------------------
DOUGLAS PARKER
-15-