SENIOR MANAGEMENT AGREEMENT
Exhibit 10.9.1
THIS
SENIOR MANAGEMENT AGREEMENT (this “Agreement”) is made as of June 17, 2002, between
IDLEAIRE TECHNOLOGIES CORPORATION, a Delaware corporation (the “Company”), and
XXXXXXX X. XXXXXXXX (“Executive”).
The parties hereto agree as follows:
1. Employment. The Company agrees to employ Executive and Executive accepts such employment
for the period beginning as of the date hereof and ending on the third anniversary of the date
hereof or upon Executive’s earlier separation pursuant to
Section 1(e) hereof (the
“Employment Period”); provided, however, that the Employment Period shall automatically be
renewed for an additional two year period commencing on the third anniversary of the date hereof
unless either the Company or the Executive gives the other at least 60 days written notice prior to
the Expiration of the Employment Period of its desire to terminate this Agreement.
(a) Position and Duties. During the Employment Period, Executive shall serve as the
Chief Executive Officer (“CEO”) of the Company and shall have the normal duties, responsibilities
and authority of the CEO, subject to the power of the Chairman or the Company’s board of directors
(the “Board”) to expand or limit such duties, responsibilities and authority and to
override actions of the CEO. Executive shall report to the Board of the Company and Executive shall
devote his best efforts and substantially all of his business time and attention to the business
and affairs of the Company and/or its Subsidiaries. Notwithstanding the foregoing, it is
understood and agreed that Executive has certain other business interests and activities which will
require some time and efforts of Executive and the Company agrees that Executive may have other
business interests and activities and devote time thereto so long as the same do not unreasonably
detract from the performance of Executive’s duties to the Company.
(b) Salary, Bonus and Benefits. Effective as of the date hereof, the Company will
pay Executive a base salary of $175,000 per annum, payable in equal installments every two
weeks, subject to any annual increase during the Employment Period as determined
by the Board based upon the Company’s achievements of budgetary and other objectives set by
the Board (the “Annual Base Salary”). In addition, Executive shall be eligible to
receive an annual bonus (commencing with the Company’s fiscal year ending December 31, 2000) based
upon the Company’s achievement of budgetary and other objectives set by the Board and agreed upon
by Executive and the Company in good faith. Executive’s Annual Base
Salary for any partial year will be prorated based upon the number of days elapsed in such year. In
addition, during the Employment Period, Executive will be entitled to such other benefits as are
from time to time made available to all of the Company’s senior executives, including vacation
time, tuition reimbursement, reimbursement of business expenses and healthcare, disability and life
insurance benefits.
(c) Business Expenses. The Company agrees that it shall, in accordance with
applicable tax laws and Company policies and any written agreement between Executive
and the Company, relating to reimbursed expenses for its executives, reimburse Executive
for all reasonable business expenses incurred by him during the term of
Executive’s employment hereunder in connection with the performance of services hereunder.
(d) Business Equipment. The Company shall provide Executive business equipment to
be utilized in accordance with the established policies, practices and procedures for executive
officers of the Company.
(e)
Separation. Executive’s employment by the Company during the Employment Period will continue until: (i) Executive’s resignation at any time which includes
resignation with Good Reason as hereinafter defined and resignation without Good
Reason, or (ii) until Executive’s disability or death, or (iii) until the Board terminates
Executive’s Employment at any time during the Employment Period. If the Employment Period
is terminated by Executive or by the Board without Cause, then the termination will be effective
thirty (30) days after the date of delivery of written notice of termination. If the Employment
Period is terminated by the Board with Cause, termination will be effective as of the date of
notice of termination. If the Employment Period is terminated by the Board with Cause, then the
Executive shall be entitled to receive his Annual Base Salary, bonuses and his fringe benefits only
through the effective date of termination. If the Employment Period is terminated by the Board
for any other reason or if Executive resigns with Good Reason, then (i) all options shall vest in
accordance with their terms without reference to continuing employment, and (ii) the Executive
shall be entitled to receive his Annual Base Salary, accrued bonuses and his life insurance,
medical insurance and disability insurance benefits, if any, for one year from the effective date
of termination (such payments, the “Severance Payment”) which shall be payable over time in
accordance with normal payroll practices. If the Employment Period is terminated due to death, then
the Annual Base Salary and medical insurance
will be continued for one full calendar year following the month in which the Executive died. If
the Employment Period is terminated due to Disability, then the Annual Base Salary, medical
insurance and disability insurance will be continued until the last day of the six-month period
following Disability; provided, however, that such Annual Base Salary shall be reduced by the
amount of
2
any disability income payments made to the Executive during such six-month period from any
insurance or other policies paid for by the Company.
2. Termination Upon A Change In Control.
(a) If there is a “change in control” of the Company, Executive will be deemed terminated and
will receive the following lump sum cash payment and a lien of the Severance Payment:
(i) If immediately before the “change in control” new stock of the Company was readily tradeable on
an established securities market or otherwise, and the shareholder approval required under IRC §
280(G) was obtained with respect to such payment, then Executive shall receive One Million Dollars
($1,000,000.00).
(ii) If the requirements of 2(a)(i) above are not met, Executive shall receive two hundred
ninety-nine percent (299%) of his “base amount” as defined in IRC § 280(G)(d)(l)(2).
The payment to be made pursuant to paragraph 2(a) above shall be made within ninety (90) days of
the change in control.
(b) For purposes of this Agreement, the term “change in control” is defined to include:
(i) A tender offer or exchange offer made and consummated for ownership of Company stock
representing fifty percent (50%) or more of the combined voting power of the Company’s outstanding
securities;
(ii) Sale or transfer of substantially all of the Company’s assets to another
corporation which is not a wholly owned subsidiary of the Company;
(iii) Any transaction relating to the Company which must be described in accordance with
item 5(f) of Schedule 14(A) of Regulation 14(A) of the Securities and Exchange Commission;
(iv) Any merger or consolidation of the Company with another corporation where less than fifty
percent (50%) of the outstanding voting shares of the surviving resulting corporation are owned in
the aggregate by the Company’s former stockholders; or
3
(v) Any tender offer, exchange offer, merger, sale of assets and/or contested election
which results in a total change in the composition of the Company’s Board of Directors.
(c) The amounts paid to Executive pursuant to this paragraph will be deemed severance pay in
consideration of Executive’s past services to the Company and his continued services from the date
of this Agreement.
3. Confidential Information.
(a) Executive acknowledges that the Company is engaged in the business of providing heating and
cooling services for vehicles and providing related convenience
services (the “Business”).
Executive further acknowledges that the Business and its continued success depend upon the use and
protection of a large body of confidential and proprietary information, and that he holds a
position of trust and confidence by virtue of which he necessarily possesses, has access to and, as
a consequence of his signing this Agreement, will continue to possess and have access to, highly
valuable, confidential and proprietary information of the Company and its Subsidiaries not known to
the public in general, and that it would be improper for him to make use of this information for
the benefit of himself and others. All of such confidential and proprietary information now
existing or to be developed in the future will be referred to in this Agreement as
“Confidential Information.” This includes, without specific limitation, information
relating to the Company’s marketing, products, internal management, the nature and operation of the
Business, the persons, firms and corporations which are customers or active prospects of the
Company during Executive’s employment by the Company, the Company’s methodology and methods of
doing business, strategic, acquisition, marketing and expansion plans, including plans regarding
planned and potential acquisitions and sales, financial and business plans, employee lists, numbers
and location of sales representatives, new and existing programs and services (and those under
development), prices and terms, customer service, costs of providing service, support and equipment
and equipment maintenance costs. Confidential Information shall not include any information that
has become generally known to and available for use by the public other than as a result of
Executive’s acts or omissions.
(b) Disclosure of any Confidential Information of the Company shall not be prohibited if such
disclosure is required in the course of his employment or is directly pursuant to a valid and
existing order of a court or other governmental body or agency within the United States; provided,
however, that (i) Executive shall first have given prompt notice to the Company of any such
possible or prospective order (or proceeding pursuant to which any such order may result) and (ii)
Executive shall afford the Company a reasonable opportunity to prevent or limit any such
disclosure, all at Company’s expense.
4
(c) During the Employment Period and for a period of three (3) years thereafter, Executive
will not disclose any of the Confidential Information known to Executive or at any time in
Executive’s possession. In addition, during the Employment Period and at all times thereafter,
Executive will not disclose to any unauthorized person or use for his own account any of such
Confidential Information without the Board’s written consent. Executive agrees to deliver to the
Company at a Separation as described in Section 1(e), or at any other time the Company may request
in writing, all memoranda, notes, plans, records, reports and other documents (and copies thereof)
containing or otherwise relating to any of the Confidential Information (including, without
limitation, all acquisition prospects, lists and contact information) which he may then possess or
have under his control. Executive acknowledges that all such memoranda, notes, plans, records,
reports and other documents are and at all times will be and remain the property of the Company.
4. Non-Competition and Non-Solicitation. Executive acknowledges that in the course of his
employment with the Company he will become familiar with the Confidential Information concerning
the Company and that his services will be of special, unique and extraordinary value to the
Company. Executive agrees that the Company has a protectable interest in the Confidential
Information acquired by Executive during the course of his employment with the Company. Therefore,
Executive agrees that:
(a) Non-Competition. So long as Executive is employed by the Company and for
an additional three (3) years thereafter (the “Non-Compete Period”), he shall not work
directly for any vehicle heating and cooling business in the United States, which manufactures,
markets, or designs products or provides services, which products or services could reasonably be
anticipated to compete with the products or services, or planned products or services, of the
Company.
(b) Non-Solicitation. During the Non-Compete Period Executive shall not directly
or indirectly through another entity (i) induce or attempt to induce any person known by Executive
to be an employee of the Company to leave the employ of the Company, or in any way interfere with
the relationship between the Company and any employee thereof, (ii) hire any person who was
known by Executive to be an employee of the Company or any of its Subsidiaries within sixty (60)
days prior to the time such employee was hired by the Executive, (iii)
knowingly induce or attempt to induce any owner of a site location, customer, supplier, licensee or
other business relation of the Company to cease doing business with the Company or in any way
knowingly
interfere with the relationship between any such customer, supplier, licensee or business relation
and the Company or (iv) knowingly directly or indirectly acquire or attempt to acquire an interest
in any
5
business relating to the business of the Company and with which, to Executive’s knowledge, the
Company has entertained discussions or has requested and received information relating to the
acquisition of such business by the Company in the three-year period immediately preceding a
Separation.
(c) Enforcement. If, at the time of enforcement of Section 3 or 4 of this Agreement, a
court holds that the restrictions stated herein are unreasonable under circumstances then existing,
the parties hereto agree that the maximum duration, scope or geographical area reasonable under
such circumstances shall be substituted for the stated period, scope or area and that the court
shall be allowed to revise the restrictions contained herein to cover the maximum duration, scope
and area permitted by law. Because Executive’s services are unique and because Executive has access
to Confidential Information, the parties hereto agree that money damages would be an inadequate
remedy for any breach of this Agreement. Therefore, in the event of a breach or threatened breach
of Section 3 or Section 4 of this Agreement, the Company or any of its successors or assigns shall,
in addition to other rights and remedies existing in its favor, be entitled to pursue specific
performance and/or injunctive or other relief in order to enforce, or prevent any violations of,
the provisions of Section 3 or Section 4 from any court of competent jurisdiction.
(d) Additional Acknowledgments. Executive acknowledges that the provisions of this Section
are in consideration of: (i) employment with the Company and (ii) additional good and valuable
consideration as set forth in this Agreement. Executive expressly agrees and acknowledges that the
restrictions contained in Sections 3 and 4 do not preclude Executive from earning a livelihood, nor
does it unreasonably impose limitations on Executive’s ability to earn a living. In addition,
Executive agrees and acknowledges that the potential harm to the Company of its non-enforcement
outweighs any harm to the Executive of its enforcement by injunction or otherwise. Executive
acknowledges that he has carefully read this Agreement and has given careful consideration to the
restraints imposed upon the Executive by this Agreement, and is in full accord as to their
necessity for the reasonable and proper protection of the Confidential Information. Executive
expressly acknowledges and agrees that each and every restraint imposed by this Agreement is
reasonable with respect to subject matter, time period and geographical area.
GENERAL PROVISIONS
5. Definitions.
“Cause” means (i) the commission of a felony or a crime involving moral turpitude or
the intentional commission of any other act or omission
6
involving dishonesty or fraud with respect to the Company or any of their customers or suppliers,
(ii) substantial and repeated failure to perform duties of the office as agreed upon by the Company
and Executive held by Executive as reasonably directed by the Board not cured within ten (10)
business days after written notice thereof, (iii) gross negligence or willful misconduct with
respect to the Company; or (iv) any intentional material breach of Section 3 or 4 of this Agreement
by Executive not cured within ten (10) business days after written notice thereof from the Company.
Any election by the Company not to renew the Employment Period on the third anniversary of the date
hereof or any renewal thereof shall be deemed to be a termination by the Board without Cause. The
failure of the Company or the Executive to achieve budgetary or other operational objectives
established by the Board of Directors shall not in any way constitute Cause.
“Disability” means a physical or mental condition which, for a continuous period of at
least six (6) months has or will prevent the Executive from performing his duties on a full time
basis and in a professional and consistent manner. Any dispute as to the Executive’s Disability
shall be referred to and resolved by a licensed physician selected and approved by the Company and
the Executive.
“Good Reason” means (i) the assignment to the Executive of any duties inconsistent in any
material respect with the Executive’s position (including status, offices, titles and reporting
requirements), authority, duties or responsibilities as contemplated by this Agreement; (ii) any
change in the location of the performance of the duties such that the Executive is required to
travel or commute a substantially greater distance than he does prior to the change; (iii)
establishment of an Annual Base Salary for the Executive which is less than provided for in this
Agreement, or failure to pay same other than an isolated, inadvertent or insubstantial failure, not
occurring in bad faith; and (iv) any purported termination of Executive’s employment by the
Company, other than as specifically set forth herein.
“Person” means an individual, a partnership, a limited liability company, a corporation, an
association, a joint stock company, a trust, a joint venture, an unincorporated organization and a
governmental entity or any department, agency or political subdivision thereof.
6. Notices. Any notice provided for in this Agreement must be in writing and must be either
personally delivered, mailed by first class mail (postage prepaid and return receipt requested) or
sent by reputable overnight courier service
(charges prepaid) to the recipient at the address below indicated:
If to the Company:
7
IdleAire Technologies Corporation
000 X. Xxx Xx., Xxxxx 000
Xxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxx, General Counsel
000 X. Xxx Xx., Xxxxx 000
Xxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxx, General Counsel
If to the Executive:
Xxxxxxx X. Xxxxxxxx
00000 Xxxxxx Xxxxx Xxxx
Xxxxxxxxx, XX 00000
00000 Xxxxxx Xxxxx Xxxx
Xxxxxxxxx, XX 00000
or such other address or to the attention of such other person as the recipient party shall
have specified by prior written notice to the sending party. Any notice under this Agreement will
be deemed to have been given when so delivered or sent or, if mailed, five days after deposit in
the U.S. mail.
7. General Provisions.
(a) Severability. Whenever possible, each provision of this Agreement
will be interpreted in such manner as to be effective and valid under applicable law, but if any
provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability
will not affect any other provision or any other jurisdiction, but this Agreement will be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision
had never been contained herein.
(b) Complete Agreement. This Agreement, those documents expressly
referred to herein and other documents of even date herewith embody the complete agreement and
understanding among the parties and supersede and preempt any prior understandings, agreements
or representations by or among the parties, written or oral, which may have related to the subject
matter hereof in any way.
(c) Counterparts. This Agreement may be executed in separate counterparts, each of
which is deemed to be an original and all of which taken together constitute one and the same
agreement.
8
(d) Successors and Assigns. Except as otherwise provided herein, this
Agreement shall bind and inure to the benefit of and be enforceable by Executive and the
Company and their respective successors and assigns.
(e) Choice of Law. All questions concerning the construction, validity and
interpretation of this Agreement and the exhibits hereto will be governed by and construed in
accordance with the internal laws of the State of Tennessee, without giving effect to any choice of
law or conflict of law provision or rule that would cause the application of the laws of any
jurisdiction other than the State of Tennessee.
(f) Remedies. Each of the parties to this Agreement will be entitled to enforce its
rights under this Agreement specifically, to recover damages and costs (including attorney’s fees)
caused by any breach of any provision of this Agreement and to exercise all other rights existing
in its favor. The parties hereto agree and acknowledge that money damages may not be an adequate
remedy for any breach of the provisions of this Agreement and that any party may in its sole
discretion apply to any court of law or equity of competent jurisdiction (without posting any bond
or deposit) for specific performance and/or other injunctive relief in order to enforce or prevent
any violations of the provisions of this Agreement.
(g) Amendment and Waiver. The provisions of this Agreement may be amended and waived
only with the prior written consent of the Company and the Executive.
(h) Business Days. If any time period for giving notice or taking action hereunder expires
on a day which is a Saturday, Sunday or holiday in the state in which the Company’s principal place
of business is located, the time period shall be automatically extended to the business day
immediately following such Saturday, Sunday or holiday.
(i)
Termination. This Agreement (except for the provisions of
Sections 1(a) and 1(b)) shall
survive a Separation as described in Section 1(e) and shall remain in full force and effect after
such Separation.
9
* * * * *
IN WITNESS WHEREOF, the parties hereto have executed this Senior Management Agreement on the
date first written above.
| IDLEAIRE TECHNOLOGIES CORPORATION | ||||
| By: | /s/ Xxx Xxxxxxx | |||
| Name: Xxx Xxxxxxx | ||||
| Title: Chief Operating Officer | ||||
| /s/ Xxxxxxx X. Xxxxxxxx | ||||
| Xxxxxxx X. Xxxxxxxx | ||||
10
