EMPLOYMENT AGREEMENT
Exhibit 10.1
This Employment Agreement (the “Agreement”), is entered into on September 3, 2008, to be
effective as of July 25, 2008, (the “Effective Date”) by and between XXXX X. XXXX (“Employee”), and
SUNAIR SERVICES CORPORATION, a Florida corporation, with offices at 000 Xxxxx Xxxxxxx Xxxxxxx,
Xxxxx 000, Xxxx Xxxxx 00000 (the “Company”).
WITNESSETH:
WHEREAS, the Company is engaged in the pest control services industry;
WHEREAS, the Company and Employee are willing to commence an employment relationship, on the
terms, conditions and covenants set forth in this Agreement.
NOW, THEREFORE, in consideration of Employee’s commencement of employment with the Company,
the mutual covenants contained herein and other good and valuable consideration, the receipt of
which the Company and Employee hereby acknowledge, Employee and the Company agree, as follows:
1. Position. Employee agrees to employment with the Company, and the Company hereby employs
Employee, in the position of President and Chief Executive Officer of the Company. Employee further
agrees to faithfully and diligently perform the job duties and to carry out the responsibilities of
that position and such other duties and responsibilities traditionally associated with such
position as determined by the Board of Directors of the Company from time to time.
2. Employee’s Effort. Employee shall faithfully and diligently perform his duties in the
capacity as an employee and in such capacity shall spend his full working time and best efforts,
skill and attention to his position and to the business and interests of the Company, and Employee
shall be prohibited from causing any private investments in businesses that are unrelated to the
business of the Company to interfere with his duties to the Company pursuant to this Agreement.
Employee shall not be required to permanently relocate to Orlando, FL in connection with the
performance of his duties under this Agreement.
3. Salary.
(a) The Company shall pay Employee (i) base compensation (the “Salary”) for services rendered
in the amount of Three Hundred Fifty Thousand Dollars ($350,000.00) per annum, payable in
installments consistent with the Company’s normal payroll schedule, subject to applicable
withholding and other taxes (which base compensation may be increased by the Board of Directors of
the Company, in its sole discretion), and (ii) annual bonus, if any, determined in accordance with
Exhibit A commencing with fiscal year 2009, and payable as soon as practicable after fiscal
year-end. The Board of Directors shall annually review Employee’s Salary for adjustment when
appropriate.
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(b) The Employee will be entitled to participate in any bonus plan, incentive compensation
program or incentive stock option plan or other employee benefits of the Company and which are
available to the other similarly situated executives of the Company, on the terms and at the level
of participation determined by the Board of Directors. Options granted pursuant to such plans shall
vest in accordance with the applicable plan from the time of grant until the Expiration Date (as
defined herein).
4. Benefits.
(a) The Company will notify Employee on or about the beginning of each calendar year with
respect to the holiday schedule (including the Company’s policy for allowing personal holidays) for
the coming year and the Employee shall be entitled to nine (9) paid holidays per year, in
accordance with the Company’s policies.
(b) Employee shall be entitled to twenty (20) paid vacation days each calendar year, to be
taken at such times as the Employee and the Company shall mutually determine and provided that no
vacation time shall significantly interfere with the duties required to be rendered by the Employee
hereunder. Any vacation time not taken by the Employee during any calendar year may not be carried
forward into any succeeding calendar year.
(c) Employee shall be entitled to sick leave and emergency leave according to the regular
policies and procedures of the Company. Additional sick leave or emergency leave over and above
paid leave provided by the Company, if any, shall be unpaid and shall be granted at the discretion
of the Board of Directors of the Company.
(d) During the term of employment hereunder, the Employee shall be entitled to participate in
all medical, dental, hospitalization, accidental death and dismemberment, disability, travel and
life insurance plans, and any and all other plans as are presently and hereinafter offered by the
Company to its executive personnel, including savings, pension, profit-sharing and deferred
compensation plans, subject to the general eligibility and participation provisions set forth in
such plans. Employee shall be responsible for payment of any federal or state income tax imposed
upon these benefits. In lieu of participating in the Company’s health care plan, Employee may
elect to receive the then current cost of such plan attributed to the CEO and use the proceeds to
purchase his own health policy.
(e) Employee shall be entitled to participate in any pension or profit sharing plan, incentive
stock option plan or any other type of plan adopted by Company for the benefit of its officers
and/or regular employees pursuant to the terms of such plans.
(f) During the term of this Agreement, the Company shall provide the Employee with a
non-accountable automobile allowance of One Thousand Dollars ($1,000.00) per month. The Employee
shall be responsible for all insurance, lease and other similar expenses incurred by the Employee
by reason of the use of such automobile. The Company shall be responsible for all costs of
gasoline, oil, repairs, maintenance, and other similar expenses incurred by the Employee by reason
of the use of such automobile for Company business from
time to time. Employee shall be responsible for payment of any federal or state income tax
imposed upon these benefits.
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(g) Employee shall be entitled to reimbursement for all reasonable expenses, including travel
and entertainment, incurred by Employee in the performance of Employee’s duties. Employee will
maintain records and written receipt as required by the Company policy and reasonably requested by
the Board of Directors of the Company to substantiate such expenses.
(h) Employee shall be entitled to reimbursement for a reasonable furnished corporate apartment
in Orlando, with a lease not to exceed a twelve month period, but any subsequent lease or lease
term shall require prior approval by the Board of Directors of the Company.
5. Term; Termination. This Agreement and the status and obligations of Employee hereunder as
an employee of the Company (except as provided for below) shall cease and terminate effective upon
the close of business on the third anniversary of the Effective Date (the “Expiration Date”) unless
earlier terminated pursuant to this Section 5 or further extended by the parties hereto in writing
in a separate instrument provided to the other party no later than sixty (60) days prior to the
applicable Expiration Date; provided, however, that upon such date said termination shall not
affect any rights that may have been specifically granted to Employee by the Board of Directors of
the Company or a designated committee thereof pursuant to any of the Company’s retirement plans,
supplementary retirement plans, profit sharing and savings plans, healthcare, 401(k) or any other
employee benefit plans sponsored by the Company, it being understood that no such rights are
granted hereunder and that the Employee’s participation in such plans shall cease as of the date of
said termination. In addition, notwithstanding the expiry or termination of this Agreement pursuant
to this Section 5 or otherwise, the Company’s and the Employee’s rights and obligations under
Sections 7 through 12 inclusive of this Agreement shall survive such termination or expiration of
this Agreement in accordance with the terms of such Sections.
(a) Termination with Notice by Either Party. The Company or Employee may terminate this
Agreement for any reason or no reason upon sixty (60) days prior written notice to the other. If
the Company terminates the employment of Employee without Good Cause (as herein defined)or the
Employee terminates his employment with Good Cause (as herein defined), the Company shall pay
Employee severance compensation calculated at the rate of Salary in effect as of the date
immediately preceding the date of termination and the cost of premiums for any Company sponsored
insurance policy (or the cash equivalent) as follows: (i) if terminated prior to the first
anniversary of this Agreement, Employee shall be paid six months, (ii) if terminated after the
first anniversary but before the second anniversary Employee shall be paid 1 year; (iii) if
terminated after the second anniversary, Employee shall be paid 2 years. All payments will be in
the manner and at such times as the Salary otherwise would have been payable to the Employee
hereunder were Employee to continue to be employed by the Company. If the Company terminates the
employment of Employee with Good Cause Employee terminates his employment with the Company without
Good Cause, or the parties do not extend or renew
this Agreement regardless of any reason, the Company shall not be under any obligation to pay
Employee, and Employee shall not be entitled to, any such severance compensation.
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(b) Termination for Good Cause by Company. In the case of the Company terminating this
Agreement, “Good Cause” means any one or more of the following: (1) a material breach or material
default by Employee of the material terms of this Agreement (except any such breach or default
which is caused by the physical disability or death of Employee) which remains uncured after twenty
(20) days following Employee’s receipt from the Company of written notice specifying such breach or
default, if subject to cure; (2) gross negligence or willful misfeasance by Employee or the breach
of fiduciary duty by Employee (if affirmatively determined by the Board of Directors of the
Company) in the performance of his duties as an employee hereunder; (3) the commission by Employee
of an act of fraud, misappropriation of funds, breach of trust, embezzlement or any other crime in
connection with Employee’s duties; (4) conviction of Employee of a felony or any crime which
involves dishonesty or a breach of trust; (5) the Employee shall be unable, or fail, to perform the
essential functions of his/her position for which he was hired, with or without reasonable
accommodation, for any period of three months or more to the extent termination for such disability
is in accordance with applicable law; (6) the death of the Employee; or (7) the Employee is unable
to perform any of the functions of his position for which he was hired, because such performance is
prohibited or enjoined by a judicial or administrative order or other agreement enforcing any
non-competition, non-solicitation or other restrictive covenant or agreement to which the Employee
is a party. In the event of a termination for Good Cause, the Company will pay Employee the Salary
earned and reasonable expenses reimbursable under this Agreement incurred through the date of
Employee’s termination. Upon the termination of Employee’s employment with the Company due to death
or disability as set forth in Sections 5(b)(5) and 5(b)(6) above, the Employee shall be entitled to
retain all options that have been granted to Employee and have vested as of the date of such
termination for the duration allowed under applicable law and the Company’s stock option plan.
(c) Termination for Good Cause by Employee. In the case of the Employee terminating this
Agreement, “Good Cause” means any one or more of the following: (1) there shall be a continuing
material breach or continuing material default by the Company of the material terms of this
Agreement which remains uncured after twenty (20) days following the Company’s receipt from the
Employee of written notice specifying such breach or default; (2) if Employee shall no longer hold
the position of Chief Executive Officer of the Company with duties and responsibilities consistent
with such positions unless there is Good Cause for the removal of Employee from such position; (3)
the Company’s decision to permanently relocate Employee to Orlando, FL; or (4) a reduction in
Employee’s Salary and/or material benefits.
6. Change in Control and Other Grounds Entitling Employee to Terminate. “Change in Control”
shall mean (a) any sale, lease, exchange or other transfer (in one transaction or a series of
transactions) of all or substantially all of the assets of the Company; (b) any consolidation or
merger or other business combination of the Company with any other entity where the shareholders of
the Company, immediately prior to the consolidation or merger or other business combination would
not, immediately after the consolidation or merger or other
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business combination, beneficially own, directly or indirectly, shares representing fifty
percent (50%) of the combined voting power of all of the outstanding securities of the entity
issuing cash or securities in the consolidation or merger or other business combination (or its
ultimate parent corporation, if any); or (c) the Board of Directors of the Company adopts a
resolution to the effect that a “Change In Control” has occurred for purposes of this Agreement.
Notwithstanding the foregoing, no transaction shall be deemed to constitute a “Change in Control”
for purposes of this Agreement if such transaction relates to any existing or former business
segment or division in which the Company operates, or if the Change of Control is procured,
directly or indirectly, by the Employee, Xxxxxxx X. Xxxxxx, Xxxxx X. Xxxxxxx, Coconut Palm Capital
Investors II, Ltd., any then existing executive officer or director of the Company or any former
executive officer or director previously affiliated with the Company at any time during the six
month period prior to the Change of Control event and/or or any affiliates of each of the
foregoing. Upon a Change in Control, 100% of all unvested stock options and/or restricted shares
held by Employee shall immediately vest. Further, if Employee elects to terminate his employment
hereunder with Good Cause (as defined in Section 5(c)) because any of the scenarios constituting
such Good Cause occurs within nine (9) months of a Change in Control then Employee shall be
entitled to the severance payments provided for in Section 5(a) so long as such Change of Control
occurs after the first anniversary of this Agreement. Nothing stated in this Section 6 shall
operate to reduce or eliminate the severance obligations of the Company to the Employee pursuant to
Section 5(a) to the extent the Company terminates the employment of Employee without Good Cause
whether in connection with a Change in Control or otherwise.
7. Confidentiality. Employee shall keep confidential, except as the Company may otherwise
consent in writing, and not divulge, communicate, disclose use to the detriment of the Company or
for the benefit of any other person or persons, misuse in any way, or make any use of except for
the benefit of the Company, at any time either during the term of this Agreement or at any time
thereafter, any Confidential Information (as defined herein). For purposes of this Agreement,
“Confidential Information” means information disclosed to the Employee or known by the Employee as
a consequence of or through the unique position of his employment with the Company (including
information conceived, originated, discovered or developed by the Employee) prior to or after the
date hereof, and not generally or publicly known, about the Company or its business, including,
without limitation, trade secrets, knowledge, data or other information of the Company relating to
the products, processes, know how, technical data, designs, formulas, test data, customer lists,
business plans, marketing plans and strategies, and product pricing strategies or other subject
matter pertaining to any business of the Company or any of its clients, customers, consultants,
licensees or affiliates which Employee may produce, obtain or otherwise learn of during the course
of Employee’s performance of services, including information expressly deemed to be confidential by
the Company . Employee shall not deliver, reproduce, or in any way allow any such Confidential
Information to be delivered to or used by any third parties without the specific direction or
consent of a duly authorized representative of the Company, except in connection with the discharge
of his duties hereunder. The terms of this paragraph shall survive termination of this Agreement.
Any Confidential Information or data now or hereafter acquired by the Employee with respect to the
business of the Company (which shall include, but not be limited to, information concerning the
Company’s financial condition, prospects, technology, customers, suppliers, sources of leads and
methods of doing business)
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shall be deemed a valuable, special and unique asset of the Company that is received by the
Employee in confidence and as a fiduciary, and Employee shall remain a fiduciary to the Company
with respect to all of such information. Notwithstanding anything to the contrary herein, Employee
shall not have any obligation to keep confidential any information (and the term Confidential
Information shall not be deemed to include any information) that (a) is generally available to the
public through no fault or wrongful act of Employee in breach of the terms hereof, (b) is
disseminated by the Company or any of its affiliates publicly without requiring confidentiality,
(c) is required by law or regulation to be disclosed by Employee, (d) is required to be disclosed
by Employee to any government agency or person to whom disclosure is required by judicial or
administrative process, or (e) is within Employee’s knowledge, experience and expertise in the pest
control services industry that he possessed at the time of this Agreement; provided that such
knowledge, experience and expertise shall not be used in violation of the restrictive covenants set
forth in Sections 9 through 12 hereof.
8. Return of Confidential Material. Upon the completion or other termination of Employee’s
services for the Company, Employee shall promptly surrender and deliver to the Company all records,
materials, equipment, drawings, documents, notes and books and data of any nature pertaining to any
invention, trade secret or Confidential Information of the Company or to Employee’s services, and
Employee will not take with him any description containing or pertaining to any Confidential
Information, knowledge or data of the Company which Employee may produce or obtain during the
course of his services. The terms of this paragraph shall survive termination of this Agreement.
9. Competition. Employee will not do any of the following, either directly or indirectly,
during Employee’s employment with the Company and, during the Applicable Non-Competition Period (as
herein defined), anywhere in the United States. In the event that Employee improperly competes with
the Company in violation of this Section, the period during which he engages in such competition
shall not be counted in determining the Applicable Non-Competition Period:
(a) For purposes of this Agreement, “Competitive Activity” shall mean any activity relating
to, in respect of or in connection with, directly or indirectly, the pest control services industry
or any existing or former business segment or division in which the Company operates.
(b) For purposes of this Agreement, “Applicable Non-Competition Period” shall equal (i) two
(2) years after Employee’s cessation of employment with the Company in the event the Company
terminates the employment of Employee without Good Cause or the Employee terminates his employment
with the Company with Good Cause, but only to the extent the Company complies with its obligation
to pay the severance payments required by Section 5(a) hereunder to Employee, and (ii) two (2)
years after Employee’s cessation of employment with the Company in the event the Company terminates
the employment of Employee with Good Cause, the parties do not extend or renew this Agreement
regardless of any reason, or Employee terminates his employment with the Company hereunder without
Good Cause.
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(c) Employee shall not, directly or indirectly, own any interest in, manage, operate, control,
consult for, be an officer or director of, work for, or be employed in any capacity by, any sole
proprietorship, corporation, company, partnership, association, venture or business any company or
any other business, entity, agency or organization (whether as an employee, officer, director,
partner, agent, security holder, creditor, consultant or otherwise) that directly or indirectly (or
through any affiliated entity) engages in Competitive Activity; provided that such provision shall
not apply to the Employee’s ownership of securities of the Company or the acquisition by the
Employee, solely as an investment, of securities of any issuer that is registered under Section
12(b) or 12(g) of the Securities Exchange Act of 1934, as amended, and that are listed or admitted
for trading on any United States national securities exchange or that are quoted on the National
Association of Securities Dealers Automated Quotations System, or any similar system or automated
dissemination of quotations of securities prices in common use, so long as the Employee does not
control, acquire a controlling interest in or become a member of a group which exercises direct or
indirect control of, more than five percent of any class of capital stock of such corporation; and
provided further that Employee shall not be in breach of this Section 9(c) if Employee is an equity
owner of Royal Palm Capital Partners, Inc., a Florida corporation (“RPCP”) and/or any entity under
the control of RPCP, and RPCP and/or any such entity under the control of RPCP, directly or
indirectly, makes an investment in the pest control industry, as long as Employee does not at any
time have any active position or involvement in such investment.
(d) Employee shall not, directly or indirectly, for himself or for any other person, firm,
corporation, partnership, association or other entity, solicit or perform services in connection
with any Competitive Activity for any prior or current customers of the Company;
(e) Employee shall not, directly or indirectly, for himself or for any other person, firm,
corporation, partnership, association or other entity, solicit or attempt to solicit for employment
or employ or attempt to employ any then current employees or former employees employed by the
Company without the Company’s consent, as applicable, unless such employee or former employee has
not been employed by the Company for a period in excess of six months; or
(f) Employee shall not make known the names and addresses of such clients or any information
relating in any manner to the Company’s trade or business relationships with such customers, other
than in connection with the performance of the Employee’s duties under this Agreement.
(g) Employee and the Company agree that the phrase “Employee’s cessation of employment with
the Company” as used in this Agreement, refers to any separation from his employment at the Company
either voluntarily by Employee pursuant to Sections 5(a) and 5(c) or involuntarily by the Company
pursuant to Sections 5(a) and 5(b).
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10. Other Obligations.
(a) Employee acknowledges that the Company from time to time may have agreements with other
persons, which impose obligations or restrictions on the Company made during the course of work
thereunder or regarding the confidential nature of such work. Employee will be bound by all such
obligations and restrictions and will take all action necessary to discharge the obligations of the
Company thereunder.
(b) All of Employee’s obligations under this Agreement shall be subject to any applicable
agreements with, and policies issued by the Company to which Employee is subject that are generally
applicable to the similarly situated executives of the Company.
11. Trade Secrets of Others. Employee represents that his performance of all the terms of this
Agreement as employee to the Company does not and will not breach any agreement to keep in
confidence proprietary information, knowledge or data of others acquired by Employee in confidence
or in trust. Employee will not enter into any agreement, either written or oral, which is in
conflict with this Agreement.
12. Other Provisions Relating to Restrictive Covenants.
(a) Ownership of Developments. All copyrights, patents, trade secrets, or other intellectual
property rights associated with any ideas, concepts, techniques, inventions, processes, or works of
authorship developed or created by the Employee during the course of performing work for the
Company or its clients (collectively, the “Work Product”) shall belong exclusively to the Company
and shall, to the extent possible, be considered a work made by the Employee for hire for the
Company within the meaning of Title 17 of the United States Code. To the extent the Work Product
may not be considered work made by the Employee for hire for the Company, the Employee agrees to
assign, and automatically assign at the time of creation of the Work Product, without any
requirement of further consideration, any right, title, or interest the Employee may have in such
Work Product. Upon the request of the Company, the Employee shall take such further actions,
including execution and delivery of instruments of conveyance, as may be appropriate to give full
and proper effect to such assignment.
(b) Books and Records. All books, records, and accounts relating in any manner to the
customers or clients of the Company, whether prepared by the Employee or otherwise coming into the
Employee’s possession, shall be the exclusive property of the Company and shall be returned
immediately to the Company on termination of the Employee’s employment hereunder or on the
Company’s request at any time.
(c) Definition of Company. Solely for purposes of these Sections 7 through 12, the term
“Company” also shall include any existing or future subsidiaries of the Company that are operating
during the time periods described herein and any other entities that directly or indirectly,
through one or more intermediaries, control, are controlled by or are under common control with the
Company during the periods described herein.
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(d) Acknowledgment by the Employee. The Employee acknowledges and confirms that (a) the
restrictive covenants contained in these Sections 7 through 12 are reasonably necessary to protect
the legitimate business interests of the Company, and (b) the restrictions contained in these
Sections 7 through 12 (including without limitation the length of the term of such provisions) are
not overbroad, overlong, or unfair and are not the result of overreaching, duress or coercion of
any kind. The Employee further acknowledges and confirms that his full, uninhibited and faithful
observance of each of the covenants contained in these Sections 7 through 12 will not cause him any
undue hardship, financial or otherwise, and that enforcement of each of the covenants contained
herein will not impair his ability to obtain employment commensurate with his abilities and on
terms fully acceptable to him or otherwise to obtain income required for the comfortable support of
him and his family and the satisfaction of the needs of his creditors. The Employee acknowledges
and confirms that his special knowledge of the business of the Company is such as would cause the
Company serious injury or loss if he were to use such ability and knowledge to the benefit of a
competitor or were to compete with the Company in violation of the terms of these Sections 7
through 12. The Employee further acknowledges that the restrictions contained in these Sections 7
through 12 are intended to be, and shall be, for the benefit of and shall be enforceable by, the
Company’s successors and assigns.
(e) Reformation by Court. In the event that a court of competent jurisdiction shall determine
that any provision of these Sections 7 through 12 is invalid or more restrictive than permitted
under the governing law of such jurisdiction, then only as to enforcement of these Sections 7
through 12 within the jurisdiction of such court, such provision shall be interpreted and enforced
as if it provided for the maximum restriction permitted under such governing law.
(f) Extension of Time. If the Employee shall be in violation of any provision of these
Sections 7 through 12, then each time limitation set forth in these Sections 7 through 12 shall be
extended for a period of time equal to the period of time during which such violation or violations
occur. If the Company seeks injunctive relief from such violation in any court, then the covenants
set forth in these Sections 7 through 12 shall be extended for a period of time equal to the
pendency of such proceeding including all appeals by the Employee.
(g) Injunction. It is recognized and hereby acknowledged by the parties hereto that a breach
by the Employee of any of the covenants contained in these Sections 7 through 12 of this Agreement
will cause irreparable harm and damage to the Company, the monetary amount of which may be
virtually impossible to ascertain. As a result, the Employee recognizes and hereby acknowledges
that the Company shall be entitled to an injunction from any court of competent jurisdiction
enjoining and restraining any violation of any or all of the covenants contained in these Sections
7 through 12 of this Agreement by the Employee or any of his affiliates, associates, partners or
agents, either directly or indirectly, and that such right to injunction shall be cumulative and in
addition to whatever other remedies the Company may possess. The Company shall not be required to
post any bond or other security in connection with any injunctive relief.
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(h) Survival. The provisions of these Sections 7 through 12 shall survive the termination of
the term of employment hereunder or expiration of the term of this Agreement.
13. Modification. This Agreement may not be changed, modified, released, discharged,
abandoned, or otherwise amended, in whole or in part, except by an instrument in writing, signed by
Employee and by the Company. Any subsequent change or changes in Employee’s relationship with the
Company or Employee’s compensation shall not affect the validity or scope of this Agreement.
14. Entire Agreement. Employee acknowledges receipt of this Agreement, and agrees that with
respect to the subject matter thereof, it is Employee’s entire agreement with the Company,
superseding any previous oral or written communications, representations, understandings with the
Company or any office or representative thereof. Each party to the Agreement acknowledges that, in
executing this Agreement, such party has had the opportunity to seek the advice of independent
legal counsel, and has read and understood all of the terms and provisions of the Agreement.
15. Severability. In the event that any paragraph or provision of this Agreement shall be held
to be illegal or unenforceable, the entire Agreement shall not fall on account thereof, but shall
otherwise remain in full force and effect, and such paragraph or provision shall be enforced to the
maximum extent permissible.
16. Successors and Assigns. This Agreement shall be binding upon Employee’s heirs, executors,
administrators or other legal representatives and is for the benefit of and shall be enforceable by
the Company, its successors and assigns.
17. Governing Law. This Agreement shall be governed by the laws of the State of Florida
without regard to any conflicts of law rules thereof.
18. Counterparts. This Agreement may be signed in counterparts and by facsimile transmission,
each of which shall be deemed an original and both of which shall together constitute one
agreement.
19. No Waiver. No waiver by either party hereto of any breach of this Agreement by the other
party hereto shall constitute a waiver of any subsequent breach.
20. Notice. Any notice hereby required or permitted to be given shall be sufficiently given if
in writing and upon mailing by registered or certified mail, postage prepaid, or upon hand-delivery
(including delivery by reputable courier), to either party at the address of such party or such
other address as shall have been designated by written notice by such party to the other party.
Neither party shall frustrate any notice attempt hereunder.
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21. Arbitration.
(a) Exclusive Remedy. The parties recognize that litigation in federal or state courts or
before federal or state administrative agencies of disputes arising out of the Employee’s
employment with the Company or out of this Agreement, or the Employee’s termination of
employment or termination of this Agreement, may not be in the best interests of either the
Employee or the Company, and may result in unnecessary costs, delays, complexities, and
uncertainty. The parties agree that any dispute between the parties arising out of or relating to
the Employee’s employment, or to the performance or termination of this Agreement or the Employee’s
employment, including, but not limited to, any claim arising out of this Agreement, claims under
Title VII of the Civil Rights Act of 1964, as amended, the Civil Rights Act of 1991, the Age
Discrimination in Employment Act of 1967, the Americans with Disabilities Act of 1990, Section 1981
of the Civil Rights Act of 1966, as amended, the Family Medical Leave Act, the Employee Retirement
Income Security Act, and any similar federal, state or local law, statute, regulation, or any
common law doctrine, whether that dispute arises during or after employment shall be resolved by
arbitration in the Broward County, Florida area, in accordance with the National Employment
Arbitration Rules of the American Arbitration Association, as modified by the provisions of this
Section 21. The sole arbitrator hereunder shall be independent of the parties and shall be
knowledgeable as to the disputed matter and the business in which the Company is engaged. Except
as set forth below with respect to Section 12 of this Agreement, the parties each further agree
that the arbitration provisions of this Agreement shall provide each party with its exclusive
remedy, and each party expressly waives any right it might have to seek redress in any other forum,
except as otherwise expressly provided in this Agreement. Notwithstanding anything in this
Agreement to the contrary, the provisions of this Section 21 shall not apply to any injunctions
that may be sought with respect to disputes arising out of or relating to Sections 7 through 12 of
this Agreement. The parties acknowledge and agree that their obligations under this arbitration
agreement survive the expiration or termination of this Agreement and continue after the
termination of the employment relationship between the Employee and the Company. BY ELECTION OF
ARBITRATION AS THE MEANS FOR FINAL SETTLEMENT OF ALL CLAIMS, THE PARTIES HEREBY WAIVE THEIR
RESPECTIVE RIGHTS TO, AND AGREE NOT TO, XXX EACH OTHER IN ANY ACTION IN A FEDERAL, STATE OR LOCAL
COURT WITH RESPECT TO SUCH CLAIMS, BUT MAY SEEK TO ENFORCE IN COURT AN ARBITRATION AWARD RENDERED
PURSUANT TO THIS AGREEMENT. THE PARTIES SPECIFICALLY AGREE TO WAIVE THEIR RESPECTIVE RIGHTS TO A
TRIAL BY JURY, AND FURTHER AGREE THAT NO DEMAND, REQUEST OR MOTION WILL BE MADE FOR TRIAL BY JURY.
(b) Arbitration Procedure and Arbitrator’s Authority. In any arbitration proceeding, each
party shall be entitled to engage in any type of discovery permitted by the Federal Rules of Civil
Procedure, to retain its own counsel, to present evidence and cross-examine witnesses, to purchase
a stenographic record of the proceedings, and to submit post-hearing briefs. In reaching his/her
decision, the arbitrator shall have no authority to add to, detract from, or otherwise modify any
provision of this Agreement. The arbitrator shall submit with the award a written opinion which
shall include findings of fact and conclusions of law. Judgment upon the award rendered by the
arbitrator may be entered in any court having competent jurisdiction.
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(c) Effect of Arbitrator’s Decision: Arbitrator’s Fees. The decision of the arbitrator shall
be final and binding between the parties as to all claims which were or could have
been raised in connection with the dispute, to the full extent permitted by law. In all cases
in which applicable federal law precludes a waiver of judicial remedies, the parties agree that the
decision of the arbitrator shall be a condition precedent to the institution or maintenance of any
legal, equitable, administrative, or other formal proceeding by the Employee in connection with the
dispute, and that the decision and opinion of the arbitrator may be presented in any other forum on
the merits of the dispute. If the arbitrator finds that the Employee was terminated in violation of
law or this Agreement, the parties agree that the arbitrator acting hereunder shall be empowered to
provide the Employee with any remedy available should the matter have been tried in a court,
including equitable and/or legal remedies, compensatory damages and back pay. The arbitrator’s fees
and expenses and all administrative fees and expenses associated with the filing of the arbitration
shall be borne by the non-prevailing party.
22. Section 162(m) Limits. Notwithstanding any other provision of this Agreement to the
contrary, if and to the extent that any remuneration payable by the Company to the Employee for any
year would exceed the maximum amount of remuneration that the Company may deduct for that year
under Section 162(m) (“Section 162(m)”) of the Internal Revenue Code of 1986, as amended (the
“Code”), payment of the portion of the remuneration for that year that would not be so deductible
under Section 162(m) shall, in the sole discretion of the Board of Directors, be deferred and
become payable at such time or times as the Board of Directors determines that it first would be
deductible by the Company under Section 162(m), with interest at the “short-term applicable rate”
as such term is defined in Section 1274(d) of the Code.
23. Assignment. The Company shall have the right to assign this Agreement and its rights and
obligations hereunder in whole, but not in part, to any corporation or other entity which is a
wholly-owned subsidiary of the Company or with or into which the Company may hereafter merge or
consolidate or to which the Company may transfer all or substantially all of its assets, if in any
such case said corporation or other entity shall by operation of law or expressly in writing assume
all obligations of the Company hereunder as fully as if it had been originally made a party hereto.
The Employee may not assign or transfer this Agreement or any rights or obligations hereunder.
24. Waiver of Jury Trial. The Employee hereby knowingly, voluntarily and intentionally waives
any right that the Employee may have to a trial by jury in respect of any litigation based hereon,
or arising out of, under or in connection with this Agreement and any agreement, document or
instrument contemplated to be executed in connection herewith, or any course of conduct, course of
dealing statements (whether verbal or written) or actions of any party hereto.
[Signatures on following page]
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The undersigned have executed this Employment Agreement as of the date first set forth above.
SUNAIR SERVICES CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxx, Xx.
Name: Xxxxxx X. Xxxxxxxx, Xx.
Title: Chief Executive Officer
Name: Xxxxxx X. Xxxxxxxx, Xx.
Title: Chief Executive Officer
/s/ Xxxx X. Xxxx
Xxxx X. Xxxx
Xxxx X. Xxxx
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EXHIBIT A
ANNUAL BONUS DETERMINATION
ANNUAL BONUS DETERMINATION
| Achievement of Actual | Bonus as percentage | ||||||
| EBITDA to Budget | of Base pay | ||||||
Less than 120%
|
Discretionary with Board of Directors | ||||||
120% — 129.99%
|
50 | % | |||||
130% — 139.99%
|
60 | % | |||||
140% — 149.99%
|
70 | % | |||||
150% — 159.99%
|
80 | % | |||||
160% — 169.99%
|
90 | % | |||||
Greater than 170%
|
100 | % | |||||
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