EXHIBIT 10.13
October 26, 1999
Xxxxxx X. Xxxx
Group Maintenance America Corp.
0 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
RE: Employment Agreement ("Employment Agreement") dated March 1, 1998,
by and between Xxxxxx X. Xxxx ("you") and Group Maintenance
America Corp. ("GroupMAC" or the "Company")
Dear Xx. Xxxx:
As you know, the Company is contemplating a merger with Building One Services
Corporation (the "Proposed Transaction"). The Proposed Transaction holds
exciting possibilities for the future of the Company and the Company wants your
to be a part of that future. The purposes of this letter are to indicate to you
that GroupMAC would very much like you to continue your employment with the
Company after the Proposed Transaction is consummated and to request certain
modifications to and waivers of the terms of your existing Employment Agreement.
The requested modifications and waivers are set forth below:
I. Modifications.
A. Position: Your title and position will be Chief Operating
Officer.
B. Base Salary: Your Base Salary will be changed to $25,000 per month.
C. Bonus: A new incentive bonus plan for executive management
of the Company will be established beginning in fiscal
year 2000, and you will participate in such plan on a
pro rated basis through the last day of the term of
your Employment Agreement. Your bonus potential under
the new plan will be 90% of your aggregate Base Salary
paid during calendar year 2000. The bonus will not be
payable until the date in calendar year 2001 on which
bonuses are paid to other
Xxxxxx X. Xxxx
October 26, 1999
Page 2
executive officers of the Company. Your bonus
potential through December 31, 1999, will be
determined and paid under the Company's existing
incentive bonus plan and your bonus potential
thereunder will remain the same.
D. Benefits: The employee benefits (other than your participation
in the Company's stock option plan) described in
Section 5 of your Employment Agreement will remain the
same; provided, however, that all of such benefits
shall continue for 540 calendar days following the
termination of your Employment Agreement.
E. Term: The initial term of your Employment Agreement set
forth in Section 2 of your Employment Agreement shall
be July 31, 2000.
F. Termination
and Severance: The terms and conditions of your Employment Agreement
in Section 10 regarding the right to terminate your
Employment Agreement and the amounts payable by the
Company to you, if any, in the event of such a
termination shall remain the same except as follows:
1. IF
(a) (i) you execute this letter agreement, and
(ii) the Company terminates the Employment
Agreement without Cause before the
consummation of the Proposed Transaction or
you terminate the Employment Agreement for
Good Reason before the consummation of the
Proposed Transaction, and
(iii) the Proposed Transaction is
consummated,
OR
(b) (i) you execute this letter agreement, and
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October 26, 1999
Page 3
(ii) the Company terminates the Employment
Agreement without Cause after the
consummation of the Proposed Transaction but
prior to July 31, 2000, or you terminate the
Employment Agreement for Good Reason after
the consummation of the Proposed Transaction
but prior to July 31, 2000.
THEN, upon the occurrence of either of the
scenarios described in Parts F.1.(a) and
F.1.(b) above, the amounts owed to you upon
termination shall be the greater of (A) the
amounts owed to you pursuant to your
Employment Agreement in such circumstances,
and (B) the amounts owed to you upon the
occurrence of a Change of Control under your
Employment Agreement as it exists prior to
the date of this letter and without giving
effect to this letter.
2. The definition of the term "Good Reason" shall be
modified to include the failure of the Company to,
within ninety (90) days after the consummation of
the Proposed Transaction, present to you for your
execution a Restated Employment Agreement
containing terms and conditions that are
substantially similar to, or better than, the terms
and conditions contained in your Employment
Agreement, as amended by this letter agreement.
G. Covenant
Not to Compete: The terms and conditions of your Employment Agreement
in Section 12 regarding your covenants not to compete
shall remain the same.
H. Moving Expenses: Notwithstanding anything in your Employment Agreement
or any document governing employee benefits owed to
you, if (i) your Employment Agreement is not
terminated prior to the expiration of its term, and
(ii) within 360 days following the expiration of such
term you relocate your primary residence to a location
outside the boundaries of the City of Houston,
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October 26, 1999
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then, upon reasonable documentation, the Company will
reimburse you for up to $10,000 in reasonable,
third-party expenses actually incurred by you as a
result of such relocation.
I. Consulting
Agreement: If your Employment Agreement is not terminated prior
to the expiration of its term, then, effective upon
the termination your Employment Agreement, the Company
shall enter into a Consulting Agreement with you which
shall contain such terms and conditions as are
reasonably satisfactory to you and the Company. The
terms and conditions of such Consulting Agreement
shall include, without limitation, (i) a covenant by
you that during the term of such Consulting Agreement
and in exchange for the consideration received therein
you shall provide the services requested by the
Company thereunder on a when and as needed basis, (ii)
a covenant by the Company that, in exchange for the
provision by you of such consulting services, the
Company shall pay you an amount equal to $20,000 per
month up to a maximum of the result determined by
subtracting the aggregate amount of Base Salary paid
to you under your Employment Agreement during calendar
year 2000 from $360,000, and (iii) a term that, unless
earlier terminated, continues until the maximum
amounts payable pursuant to clause (ii) have been
paid.
J. Existing Options
to Vest: Provided you have not resigned other than for "Good
Reason" nor been terminated for "Cause" prior to
July 31, 2000, all of your unvested options shall
vest on July 31, 2000.
K. No Additional
Options: You will be granted no additional options subsequent
to the date of this letter, but the Company will make
reasonable efforts to allow you a mechanism to
liquidate your options granted pursuant to the Option
Agreement dated August 1, 1997 in conjunction with the
Proposed Transaction.
L. Other: Except as set forth above, all other terms and
conditions of your Employment Agreement shall remain
unchanged and in full force and effect.
Xxxxxx X. Xxxx
October 26, 1999
Page 5
II. Waiver of Certain Rights in Employment Agreement. Certain aspects of the
Proposed Transaction will constitute a "Change of Control" (as such term is
defined in your Employment Agreement) and will afford you certain rights and
remedies pursuant to Sections 7, 8, 9 and 10(c) of your Employment Agreement.
The Company is requesting that you waive your rights under the Employment
Agreement, including, without limitation, Sections 7, 8, 9 and 10(c), in
connection with each aspect of the Proposed Transaction. Accordingly, by
executing this letter, you agree to waive (i) all of the provisions of your
Employment Agreement, including, without limitation, Sections 7, 8, 9 and
10(c), in connection with each and every aspect of the Proposed Transaction,
(ii) the application of such provisions, including, without limitation, Sections
7, 8, 9 and 10(c), as a result of any aspect of the Proposed Transaction, and
(iii) any and all rights and remedies available to you pursuant to your
Employment Agreement, including, without limitation, Sections 7, 8, 9 and 10(c),
as a result of any aspect of the Proposed Transaction (the waivers described in
clause (i), (ii) and (iii) being collectively referred to as the "Employment
Agreement Waiver"). The Employment Agreement Waiver is a limited waiver that
applies only to the Proposed Transactions and, except as set forth in this
Sections I and II hereof, the Agreement, including Sections 7, 8, 9 and 10(c),
shall remain unchanged and in full force and effect.
III. General.
A. Effective Date. If you execute this letter agreement, unless
terminated pursuant to its terms, the provisions of this letter
agreement (i) contained in Section I. above (except for part F
thereof) shall become effective as of the date of the consummation of
the Proposed Transaction, and (ii) contained in Part F of Section I.
above and Sections II and III shall become effective on the date this
letter agreement is executed by you.
B. Termination of Letter Agreement. If GroupMAC does not complete the
Proposed Transactions by March 31, 2000, then this letter agreement,
including, without limitation, the Waivers, will automatically
terminate without any action on the part of GroupMAC or you, and the
Employment Agreement will remain in full force and effect as if this
letter agreement had not been executed by you or GroupMAC.
C. Definitions. All capitalized terms used in this letter agreement but
not defined in this letter agreement shall have the meaning set forth
in the Employment Agreement. Additionally, the term "you" refers to
the addressee of this letter agreement.
D. Restated Employment Agreement. It is the intent of the Company and you
that this letter agreement constitute an amendment to the Employment
Agreement effective on the dates set forth in Section III.A. above.
The Company will in the future request that you execute a restated or
amended version of your Employment Agreement that
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October 26, 1999
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has been modified to reflect all of the modifications set forth in this
letter agreement, and you hereby agree to execute such version.
If the foregoing modifications of your Employment Agreement and the Waivers are
acceptable to you, please sign and date the copy of this letter in the space
provided below and return the copy to us by the close of business on October 28,
1999. If you have any questions, please feel free to call me at 000-000-0000 or
GroupMAC's general counsel, Xxxxx Xxxxxx, at 000-000-0000.
Very truly yours,
GROUP MAINTENANCE AMERICA CORP.
By: /s/ J. Xxxxxxx Xxxxxxxx, Xx.
----------------------------
J. Xxxxxxx Xxxxxxxx, Xx.
Chief Executive Officer
AGREED to and ACCEPTED this 28 day of October, 1999
/s/ Xxxxxx X. Xxxx
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Xxxxxx X. Xxxx
