ex10-3.htm


    Exhibit 10.3

     

    
      EMPLOYMENT
AGREEMENT

      


      EMPLOYMENT AGREEMENT (the “Agreement”)
dated as of June 13, 2007 and effective June 1, 2007 by and between PATIO-BAHIA,
INC. (formerly JEANNOT’S FURNISHINGS OF FLORIDA, INC.), a Florida corporation
(the “Company”), and  Jeannot McCarthy (“McCarthy”) of 201 Holly Lane,
Plantation Florida 33317.

      


      WITNESSETH:

      


      WHEREAS, the Company is engaged in the
design and distribution of patio and yacht furniture business
(“Business”);

      


      WHEREAS,
McCarthy has previously served as an officer of the Company since inception of
the Company in November 2002 without salary; and

      


      WHEREAS,
the Company has established a valuable reputation and goodwill in the
Business

      


      WHEREAS, the Company desires to
continue the employment of McCarthy and to enter into an Agreement embodying the
terms of such employment; and

      


      WHEREAS, McCarthy desires to accept
such employment terms and enter into such Agreement;

      


      NOW, THEREFORE, in consideration of the
premises and mutual covenants herein and for other good and valuable
consideration, the parties agree as follows:

      


      1. Term of
Employment.  McCarthy shall be
employed by the Company for a period commencing as of June 1, 2007 (the
“Commencement Date”) and ending May 31, 2009  on the terms and subject
to the conditions set forth in this Agreement, and such Term shall automatically be
extended for successive one (1) year terms thereafter unless; (a) the parties
mutually agree in writing to alter or amend the terms of the Agreement; (b) one
or both of the parties exercises their right, pursuant to Section 6 herein, to
terminate this employment relationship; or (c) either party notifies the other
at least three (3) months prior to the end of the Term of such party’s intent
not to extend the Agreement.  For purposes of this Agreement, the Term
(the "Term") shall include the initial term and all renewals
thereof.

      


      2. Position and
Location.

      


      a. Positions.  Effective
on the Commencement Date, McCarthy shall serve as the CEO and President of the
Company.  At all times, McCarthy shall have such duties and authority
as are commensurate with her then position and shall report only to the Board of
Directors.  In her capacity as CEO and President of the Company,
McCarthy shall be authorized to incur obligations and undertake agreements and
commitments on behalf of the Company without approval of the Board of Directors,
provided that approval shall be obtained from the Board of Directors for such
obligations, agreements and commitments exceeding $5,000.00.  McCarthy
represents and warrants to the Company that she is free to accept employment
with the Company as contemplated herein and has no other written or oral
obligations or commitments of any kind or nature which would in any way
interfere with her acceptance of employment pursuant to the terms hereof or the
full performance of her obligations hereunder or the exercise of her best
efforts in her employment hereunder.  In the event that McCarthy is
not retained by the Company or by the Board of Directors as a director and/or
President of the Company during the term hereof, the Company will not deemed to
be in breach of this Agreement.

      


      
        
          
          

        

        
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      b. Time
Devoted.  During the Term, McCarthy will devote 80% of
McCarthy’s business time and efforts to the performance of McCarthy’s duties
hereunder and, except as provided in the next sentence, will not engage in any
other business, profession or occupation for compensation or otherwise, without
the prior written consent of the Board.  Nothing herein shall preclude
McCarthy from accepting appointment to civic or charitable directorships or
trusteeships, or otherwise being involved in charitable activities or managing
her personal and family passive investments; provided in each case, and in the
aggregate, that such activities do not materially conflict or interfere with the
performance of McCarthy’s duties hereunder or conflict with Section
7.

      


      c. Principal
Offices.  Unless otherwise mutually agreed by the parties,
McCarthy’s principal offices shall be located at the Company’s principal
offices.

      


      d. Compliance with
Laws.  McCarthy acknowledges that the Company is subject to
various laws, statutes and high ethical standards by reason of the nature of its
business activities, and McCarthy agrees to fully comply with all laws, rules
and statutes and ethical standards applicable to the Company.

      


      3. Base
Salary and Bonuses.

      


      (a) McCarthy shall receive
an annual base salary equal to $50,000, which may be increased by the approval
of the Board of Directors, which salary will accrue until such time as the
Company generates $300,000 in revenues/sales.

      


      (b) In
addition to all other compensation referred to herein, the Company may pay
McCarthy a bonus at the end of any given year, or more frequently, which the
Company, in its absolute and sole discretion, determines is proper in relation
to income and all other facts and circumstances that it shall see fit to
consider

      


      4. Employee
Benefits.  During the Term,
McCarthy shall be entitled to participate in the Company’s employee benefit
plans as in effect from time to time.  During each fiscal year of the
Company, McCarthy shall be entitled to reasonable vacation time, provided that
the McCarthy shall evidence reasonable judgment with regard to appropriate
vacationing scheduling.  Subject to the foregoing, McCarthy shall be
entitled to three (3) weeks vacation per year, with any unused vacation time to
lapse as of the conclusion of the related fiscal year, unless the Board of
Directors shall authorize the accruing of such unused vacation
time.

      


      5. Business
Expenses.  During the Term,
reasonable business expenses incurred by McCarthy in the performance of
McCarthy’s duties hereunder shall be reimbursed by the Company in accordance
with Company policies.

      


      6. Termination.

      


      a.      By Company for Cause, or
Disability or by McCarthy’s Voluntary Resignation.

      


      (i) The
Employment Term and McCarthy’s employment hereunder may be terminated by the
Company for Cause, or Disability and shall terminate automatically upon
McCarthy’s resignation.

      


      
        
          
          

        

        
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      (ii) For
purposes of this Agreement, “Cause” shall mean (A) willful malfeasance or
willful misconduct by McCarthy in connection with her employment, (B) failure of
McCarthy to perform her material duties under this Agreement after written
notice of her failure to so perform (other than as a result of physical or
mental incapacity), (C) McCarthy’s material willful and knowing breach of the
Agreement that remains uncured for a period of ten (10) business days following
McCarthy’s receipt of written notice from the Company describing such breach,
(D) committing or participating in an injurious act, gross neglect or material
omission of responsibilities hereunder after written notice thereof, which
remains uncured for a period of ten (10) business days following McCarthy’s
receipt of written notice from the Company describing such breach; or (E)
engaging in a criminal enterprise involving moral turpitude, embezzlement, or
conviction of an act or acts constituting a felony under the laws of the United
States or any state thereof.  For the purposes of this Agreement, no
act, or failure to act, on McCarthy’s part shall be considered “willful” unless
done or omitted to be done by him not in good faith and without reasonable
belief that her action or omission was in the best interests of the
Company.  The date of termination for a termination for Cause shall be
the date indicated in the Notice of Termination.

      


      (iii) For
purposes of this Agreement, “Disability” shall mean McCarthy’s inability to
perform her material duties for a period of at least three (3) consecutive
months or an aggregate of six (6) months in any twelve (12) month period as a
result of a physical or mental incapacity.  The Company may terminate
McCarthy due to Disability on thirty (30) days prior written notice given during
the period McCarthy is unable to perform her material duties as a result of a
physical or mental incapacity; provided, however, that McCarthy has not returned
to the performance of her material duties prior to the end of the applicable
three (3) month or six (6) month period described above.

      


      (iv) If
McCarthy’s employment is terminated by the Company for Cause, or Disability or
if McCarthy resigns, McCarthy shall be entitled to receive the following
benefits:

      


      (A) the Base
Salary through the date of termination;

      


      (B) any Bonus
earned, but unpaid, as of the date of termination for any previously completed
fiscal year;

      


      (C) reimbursement
for any unreimbursed business expenses incurred by McCarthy in accordance with
Company policy prior to the date of McCarthy’s termination; and

      


      (D) such
Employment Benefits, if any, as to which McCarthy may be legally entitled under
the employee benefit plans and equity plans of the Company (the amounts
described in clauses (A) through (D) hereof being referred to as the “Accrued
Rights”).

      


      Following such termination of
McCarthy’s employment by the Company for Cause, Disability or resignation by
McCarthy, except as set forth in this Section, McCarthy shall have no further
rights to any compensation or any other benefits under this Agreement or any
other severance plan, severance policy or severance arrangement of the Company
or its affiliates, except as provided in this Agreement.

      


      b.      By the Company Without Cause
or death.

      


      (i) The Term
and McCarthy’s employment hereunder may be terminated by the Company without
Cause.

      


      
        
          
          

        

        
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      (ii) If
McCarthy’s employment is terminated by the Company without Cause (other than by
reason of Disability) or by death of McCarthy, McCarthy (or McCarthy’s estate as
the case may be) shall be entitled to:

      


      (A) receive
the Accrued Rights; and

      


      (B) receive,
subject to McCarthy’s continued compliance with the provisions of Sections 7 and
8 hereof in case of termination without cause, continued payment of the Base
Salary for six (6) months.

      


      Following
McCarthy’s termination of employment by the Company without Cause (other than by
reason of McCarthy’s Disability) or upon death of McCarthy, McCarthy shall have
no further rights to any compensation or any other benefits under this Agreement
or any other severance plan, severance policy or severance arrangement of the
Company or its affiliates except as provided in this Agreement.

      


      c.      Notice of
Termination.  Any purported termination of employment by the
Company or by McCarthy (other than due to McCarthy’s Disability) before the
expiration of the Term shall be communicated by written Notice of Termination to
the other party hereto in accordance with Section 11.g. hereof.  For
purposes of this Agreement, a “Notice of Termination” shall mean a notice which
shall indicate the specific termination provision relied upon and shall set
forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of employment under the provision so indicated, unless the
notice is provided pursuant to Section 1 hereof.

      


      7. Non-Competition.

      


      a.      Precluded
Conduct.  McCarthy acknowledges and recognizes the highly
competitive nature of the businesses of the Company and accordingly agrees as
follows:

      


      (i) During
the Term and for a period of 18 months following the date McCarthy ceases to be
employed by the Company (the “Restricted Period”), McCarthy shall not directly
or indirectly in and from any location within a 100 miles radius from any office
of the Company or any point of present of the Company’s business (A) engage in
any business that materially competes with the business of the Company
(including, without limitation, businesses which the Company has specific plans
to conduct business within the future and as to which McCarthy is aware of such
planning), (B) enter the employ of, or render any services to, any person or
entity engaged in any business that materially competes with the business of the
Company in the portions of the business so competing, (C) acquire a financial
interest in, or otherwise become actively involved with, any person or entity
engaged in any business that materially competes with the business of the
Company, directly or indirectly, as an individual, partner, shareholder,
officer, director, principal, agent, trustee or consultant, or (D) interfere
with, or attempt to interfere with, business relationships (whether formed
before or after the date of this Agreement) between the Company and customers,
clients, suppliers, partners, members or investors of the Company.

      


      (ii) Notwithstanding
anything to the contrary in this Agreement, McCarthy may, directly or
indirectly, own, solely as an investment, securities of any person or entity
engaged in the business of the Company which are publicly traded on a national
or regional stock exchange or on the over-the-counter market or are owned
through a mutual fund, private equity fund or other pooled account if McCarthy
(A) is not a controlling person of, or a member of, a group which controls such
person or entity, and (B) does not, directly or indirectly, own 3% or more of
any class of securities of such person or entity.  Furthermore, the
limitations in (i) shall not apply to serving as a director of an entity if less
than ten percent of such entity’s revenues (measured by the last fiscal year of
the entity ending prior to the date McCarthy accepts such a role) are from
materially competitive activities, subject to the Board’s (or the Company’s
principal executive officer other than McCarthy, as the case may be) approval
during the Employment Term as provided in Section 1 hereof.

      


      
        
          
          

        

        
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      (iii) During
the Restricted Period, except in performance of her duties hereunder, McCarthy
will not, directly or indirectly, (A) solicit or encourage any employee of the
Company to leave the employment of the Company, or (B) hire any such employee
who was employed by the Company as of the date of McCarthy’s termination of
employment with the Company, or who left the employment of the Company within
one (1) year prior to or after the termination of McCarthy’s employment
hereunder.  This restriction shall not be violated by general
advertising or by serving as a reference.

      


      (iv) During
the Restricted Period, McCarthy will not, directly or indirectly, solicit or
encourage to cease to work with the Company any consultant then under contract
with the Company.  This restriction shall not be violated by general
advertising or by serving as a reference.

      


      b.      Reasonable Construction of
Contract.  It is expressly understood and agreed that although
McCarthy and the Company consider the restrictions contained in this Section 7
to be reasonable, if a final judicial determination is made by a court of
competent jurisdiction that the time or territory or any other restriction
contained in this Agreement is an unenforceable restriction against McCarthy,
the provisions of this Agreement shall not be rendered void, but shall be deemed
amended to apply as to such maximum time and territory and to such maximum
extent as such court may judicially determine or indicate to be
enforceable.  Alternatively, if any court of competent jurisdiction
finds that any restriction cannot be amended so as to make it enforceable, such
finding shall not affect the enforceability of any of the other restrictions
contained herein.

      


      8. Confidentiality.  McCarthy will not
at any time (whether during or after McCarthy’s employment with the Company)
disclose or use for McCarthy’s own benefit or purposes or the benefit or
purposes of any other person, firm, partnership, joint venture, association,
corporation or other business organization, entity or enterprise other than the
Company and any of its subsidiaries or affiliates, any trade secrets,
information, designs, drawings, data or other confidential information relating
to customers, development programs, costs, marketing, trading, investment, sales
activities, promotion, credit and financial data, manufactures and manufacturing
processes, financing methods, plans or the business and affairs of the Company,
generally, or of any subsidiary or affiliate of the Company, except in the
performance of her duties hereunder or in compliance with legal process;
provided, however, that the foregoing shall not apply to information which is
not unique to the Company, or which is generally known to the industry or the
public other than as a result of McCarthy’s breach of this
covenant.  In the event that McCarthy is compelled by legal process to
disclose confidential information, he shall give prompt written notice to the
Company to allow the Company the opportunity to object to or otherwise resist
such order.  McCarthy agrees that upon termination of McCarthy’s
employment with the Company for any reason, he will return to the Company
immediately all memoranda, books, papers, plans, information, letters and other
data, and all copies thereof or therefrom in any way relating to the business of
the Company and its affiliates, except that he may retain personal notes,
notebooks and diaries that do not contain confidential information of the type
described in the preceding sentence.  McCarthy shall be bound by the
nondisclosure provisions of this Section 8.  McCarthy further agrees
that he will not retain or use for McCarthy’s account at any time any trade
names, trademark or other proprietary business designation used or owned in
connection with the business of the Company or its affiliates.

      


      
        
          
          

        

        
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      9. Trademark
and Copyright Registrations.  McCarthy agrees to assist the
Company, or its designee, at the Company’s expense, in every proper way to
secure the Company’s rights in the copyrights, trademarks, service marks, trade
names or other intellectual property rights relating thereto in any and all
countries, including the disclosure to the Company of all pertinent information
and data with respect thereto, the execution of all applications,
specifications, oaths, assignments and all other instruments which the Company
shall deem necessary in order to apply for and obtain such rights and in order
to assign and convey to the Company, its successor, assigns, and nominees the
sole and exclusive rights, title and interest in and to such copyrights,
trademarks, service marks, trade names or other intellectual property rights
relating thereto.  McCarthy further agrees that her obligation to
execute or cause to be executed, when it is in her power to do so, any such
instrument or papers shall continue after the termination of this
Agreement.

      


      10. Indemnification.  The Company shall
indemnify and hold harmless McCarthy to the fullest extent permitted by law for
any action or inaction of McCarthy while serving as an officer and director of
the Company or, at the Company’s request, as an officer or director of any other
entity or as a fiduciary of any benefit plan, provided McCarthy has not been
terminated For Cause.  The Company shall also indemnify and hold
McCarthy harmless in the event that McCarthy is asked to honor and discharge any
personal guarantees he has provided to the Company either subsequent to or prior
to its organization.

      


      11. Miscellaneous.

      


      a. Governing
Law.  This Agreement shall be governed by and construed in
accordance with the laws of the State of Florida without regard to conflicts of
laws principles thereof.

      


      b. Entire
Agreement/Amendments.  This Agreement contains the entire
understanding of the parties with respect to the employment of McCarthy by the
Company.  There are no restrictions, agreements, promises, warranties,
covenants or undertakings between the parties with respect to the subject matter
herein other than those expressly set forth herein.  This Agreement
may not be altered, modified or amended except by written instrument signed by
the parties hereto.

      


      c. No
Waiver.  The failure of a party to insist upon strict adherence
to any term of this Agreement on any occasion shall not be considered a waiver
of such party’s rights or deprive such party of the right thereafter to insist
upon strict adherence to that term or any other term of this
Agreement.

      


      d. Severability.  In
the event that any one or more of the provisions of this Agreement shall be or
become invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions of this Agreement shall not be
affected thereby.

      


      e. Successors; Binding
Agreement.  This Agreement shall be binding upon the parties
hereto, their heirs, legal representatives, successors and
assigns.  This Agreement shall not be assignable by McCarthy, but
shall be assignable by the Company in connection with the sale, transfer or
other disposition of its business or to any of the Company’s affiliated,
controlled or other companies under common control with the
Company.

      


      f. Headings.  The
headings of this Agreement are for convenience only and shall not control or
affect the meaning or construction or limit the scope or intent of any of the
provisions of this Agreement.

      


      g. Notice.  For
the purpose of this Agreement, notices and all other communications provided for
in the Agreement shall be in writing and shall be deemed to have been duly given
when delivered by hand or overnight courier or three days after it has been
mailed by United States registered mail, return receipt requested, postage
prepaid, addressed to the respective addresses set forth below, or to such other
address as either party may have furnished to the other in writing in accordance
herewith, except that notice of change of address shall be effective only upon
receipt.

      


      
        
          
          

        

        
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                  If
      to the Company:  

                	
                  400
      S. Pointe Drive

                


        

      

      Suite
1704

      Miami
Beach, Florida 33139

      


      
        	
                 
      

              	
                If
      to McCarthy:

              	
                To
      the most recent address of McCarthy set forth in the personnel records of
      the Company.

              


      

      


      h.      Independent
Counsel.  The Company and McCarthy agree that each of them have
been, or were advised and fully understand, that they are entitled to be
represented by independent legal counsel with respect to all matters
contemplated herein from the commencement of negotiations at all times through
the execution hereof.

      


      12. Withholding
Taxes.  The Company may
withhold from any amounts payable under the Agreement such federal, state and
local taxes as may be required to be withheld pursuant to any applicable law or
regulation.

      


      13. Counterparts.  This Agreement
may be signed in counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same
instrument.

      


      14. Enforcement.  Should
it be necessary for any party to institute legal action to enforce the terms and
conditions of this Agreement, the successful party will be awarded reasonable
attorneys’ fees in any arbitration proceedings or in any court and appellate
proceedings together with related expenses and costs.

      


      15. Arbitration.  Any
dispute, controversy or claim arising out of or in connection with this
Agreement, including any questions regarding its existence, validity or
termination, shall be finally resolved by arbitration by the American
Arbitration Association except as otherwise provided hereafter.  Any
such dispute, controversy or claim shall be submitted to a board of arbitrators
composed of three competent disinterested persons, one to be chosen by the
Company, one by McCarthy and the third to be selected by the two arbitrators so
chosen.  Such arbitration shall take place in Broward County,
Florida.  The prevailing party shall be entitled to reimbursement of
any and all fees of the arbitration proceedings.  As to any claim for
the award of non-monetary or equitable relief, each party hereby irrevocably
submits to the exclusive jurisdiction of the state courts sitting in the County
of Broward, State of Florida.

      


      The arbitrators may not award
non-monetary or equitable relief of any sort.  They shall have no
power to award punitive damages or any other damages not measured by the
prevailing party’s actual damages, and the parties expressly waive their right
to obtain such damages in arbitration or in any other forum.  In no
event, even if any other portion of these provisions is held to be invalid or
unenforceable, shall the arbitrators have power to make an award or impose a
remedy that could not be made or imposed by a court deciding the matter in the
same jurisdiction.  No discovery will be permitted in connection with
the arbitration unless it is expressly authorized by the arbitration panel upon
a showing of substantial need by the party seeking discovery.  All
aspects of the arbitration shall be treated as confidential.  Neither
the parties nor the arbitrators may disclose the existence, content or results
of the arbitration, except as necessary to comply with legal or regulatory
requirements.  Before making any such disclosure, a party shall give
written notice to all other parties and shall afford such parties a reasonable
opportunity
to protect their interests.  The result of the arbitration will be
binding on the parties, and judgment on the arbitrators’ award may be entered in
any court having jurisdiction.

      


      
        
          
          

        

        
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      IN
WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the
day and year first above written.

      


      JEANNOT’S FURNISHINGS OF FLORIDA,
INC.

      


      


      By: __________________________________                                                               

      Zlatuse Jerabkova, Vice
President

       
 

      
______________________________

      JEANNOT MCCARTHY

       

       

       

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