EMPLOYMENT AGREEMENT FOR XXXXX X. XXXXXXX
THIS EMPLOYMENT AGREEMENT (this "Agreement"), made as of this 1st day
of January, 2011, ("Term Start Date") between Iron Eagle Group, Inc.,
a corporation organized under the laws of the State of Delaware (the
"Company"), and Xxxxx X. Xxxxxxx (the "Employee"). This Agreement
amends the employment agreement between Employee and Company dated
November 5, 2009 and shall take effect as of the Term Start Date and
does not modify any compensation or expenses due to Employee prior to
the Term Start Date.
BACKGROUND
WHEREAS, the Company is engaged in the business of acquisition of and
management of construction and construction-related companies (the
"Business").
WHEREAS, the Company desires to hire Employee and Employee desires to
work for the Company upon the terms and conditions hereinafter set
forth.
WHEREAS, this Agreement contains the entire understanding of employment
with the Company and supersedes all discussions, proposals or prior
agreements, written or oral, and all other communications relating to
the subject matter hereinafter set forth.
WHEREAS, the provisions set out in this Agreement are to be interpreted
fairly between Employee and Company and not in favor or against either
party.
NOW, THEREFORE, in consideration of the mutual covenants and
obligations contained herein, and intending to be legally bound, the
parties, subject to the terms and conditions set forth herein, agree as
follows:
1. Definitions.
a. Cause. For purposes of this Agreement "Cause" with respect to the
termination by the Company of the Employee's employment shall mean (i)
failure by the Employee to perform his duties for the Company under
this Agreement or to perform the directives of the Board of Directors
of the Company (the "Board") which, if capable of being cured, remains
uncured for more than 20 days after written notice from the Board
specifying such failure; (ii) misconduct by the Employee which causes
material injury to the Company; (iii) a material breach or violation by
the Employee of (a) any provision of this Agreement or (b) any
employment policy of the Company which, in each case, if capable of
being cured remains uncured for more than 20 days after written notice
specifying such violation or breach is given to Employee; or (iv)
conviction of, or a plea of guilty or nolo contendre to, a felony or
other crime involving moral turpitude, embezzlement, fraud or
dishonesty (other than a traffic violation), habitual alcohol abuse,
drug abuse, or excessive absenteeism other than for illness, after a
warning (with respect to drunkenness or absenteeism only) in writing
from the Board to refrain from such behavior.
b. Good Reason. When used with reference to a voluntary termination by
Employee of his employment with the Company, "Good Reason" shall mean
any of the following, if taken without Employee's express written
consent (1) a reduction by the Company in the Employee's annual salary
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(including deferred salary) to an amount less than the Employee's Base
Compensation (as defined in Section 4) or (2) the Executive is demoted
by means of a substantial reduction in authority, responsibilities or
duties usually consistent with the position described in Section 1
hereof.
c. Term. For purposes of this Agreement, the "Term" of this Agreement
shall start on the Term Start Date and shall be for four (4) years from
the Term Start Date hereof, unless sooner terminated in accordance with
the provisions hereof.
d. Renewal. This Agreement shall automatically renew on an annual
basis after the initial term as agreed upon by both parties in writing
sixty (60) days prior to end of the Term.
e. Executive shall have the same meaning as Employee.
2. Employment. The Company hereby agrees to employ the Executive, and
the Executive hereby accepts employment, upon the terms and subject to
the conditions set forth herein.
3. Position.
a. Duties. During the Term the Employee shall be hired as the Chief
Financial Officer with the following duties: accounting, financial, and
risk management operations of the company, to include the development
of a financial strategy, capital raising, communicating with investors,
identifying, conducting due diligence, and executing the acquisition of
companies that fit Iron Eagle's business model and then managing the
integration of those companies into Iron Eagle. ("Duties"). Employee
will report to the Chief Executive Officer ("CEO") and to the Board of
Directors of the Company ("Board"). In addition, Employee will also be
responsible for such other duties that may be assigned to Employee from
time to time by the Board. The Employee shall devote his full time,
energy and attention to the business of the Company, and shall not,
during the Term, be engaged in any other activity that may interfere in
any respect with the performance of the Employee's Duties.
b. Company Policies. Employee agrees to comply with all Company
policies and procedures in effect as of the Term Start Date as well as
any modifications or additions to those policies and procedures. This
will include by way of example and those contained in an Employee
handbook or policy manual that is presently under development. Parties
understand however, that if there is a conflict between any policy or
procedure and any provision contained in this Agreement, the provisions
contained in this Agreement shall prevail.
4. Compensation.
a. Base Salary. The Company will pay Employee an annual gross base
salary ("Base Salary") as defined below. Any actual payments of salary
or bonuses made to Employee will be net of any governmental applicable
taxes and fees that Company acting in good faith and its sole
discretion determines need to be deducted from payments to Employee.
Employee shall the right to receive the Base Salary for one year after
the Term Start Date regardless of Employee's employment status with the
Company.
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i. Cash Base Salary. The Company will pay Employee an annual gross base
salary in cash of Two Hundred Twenty-Five Thousand ($225,000.00)
Dollars ("Cash Base Salary") payable at least semi-monthly.
ii. Equity Base Salary. The Company will pay Employee an annual gross
base salary in equity ("Equity Base Salary") that shall vest annually
as follows:
(a) January 1, 2012 - Seventy-Five Thousand (75,000)
shares
(b) January 1, 2013 - Seventy-Eight Thousand Seven
Hundred Fifty (78,750) shares
(c) January 1, 2014 - Eighty-Two Thousand Six Hundred
Eighty-Eight (82,688) shares
(d) January 1, 2015 - Eighty-Six Thousand Eight Hundred
Twenty-Two (86,822) shares
b. Bonuses. At the sole discretion of the Board, Employee will be
eligible to receive a cash and equity bonus of up to 100% of Base Fee
each year. The relative percentage of cash and equity in the bonus
will be similar to the cash and equity mix in the Base Fee. The Bonuses
will be based upon actual performance of the Employee and the Company
as determined by the Board. The equity portion of the bonus will be
paid in shares of the Company and will be fully vested on the date the
bonus is granted.
c. Incentive Compensation Plan in Iron Eagle. The Board shall create a
compensation committee ("Compensation Committee") to create an option
package for Employee. The Compensation Committee will make annual stock
option grant awards ("Options") in a manner consistent with the
policies and procedures of Iron Eagle which will be based upon
Employee's service to the Company and overall performance criteria. The
time, amount and grant of Options shall be in the sole discretion of
the board based upon Employee's performance on an annual basis.
d. Annual Increase. The Board agrees to increase Employee's salary at
least annually as of each anniversary of the Term Start Date at a
minimum of Five Percent (5%) per annum for both the Base Salary and
Bonuses (including the cash and equity components) with additional
upside based on performance which shall be at the sole discretion of
the Board.
5. Expenses and Fringe Benefits.
a. Expenses. During the Term, the Company shall reimburse the Employee
for all ordinary and necessary business expenses reasonably incurred by
him with respect to the business of the Company and submitted to the
Company (with appropriate supporting documentation) for reimbursement
in accordance with the policies established from time to time by the
Board.
b. Auto Allowance. The Employee shall be entitled to a monthly auto
allowance of $1,000.00, which includes all auto expenses, including,
but not limited to, mileage, lease, ownership, and/or insurance.
c. Other Benefits. During the Term, the Employee also shall be entitled
to participate in or receive health and other benefits under insurance
and other Employee benefit plans of the Company which are generally
available to its Employees.
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d. Vacation. The Employee shall be entitled to four (4) weeks paid
vacation, as well as a reasonable number of personal and sick days,
used as necessary.
6. Termination for Cause. The Company shall have the right to terminate
the Employee for Cause, upon written notice to him of the termination
which notice shall specify the reasons for the termination and the date
of termination. In the event of termination for Cause, the Employee
shall not be entitled to any further benefits under this Agreement. For
purposes of this Agreement, the "date of termination" with respect to
termination for Cause, shall mean the date set forth in the notice of
termination.
7. Disability. During the Term, if the Employee becomes permanently
disabled, or is unable to perform his duties hereunder for 3
consecutive months, in each case as determined by the Board in its
reasonable discretion, the Company may terminate the employment of the
Employee. In such event, the Employee shall not be entitled to any
further benefits under this Agreement other than payments under any
disability insurance policy which the Company may have obtained
generally for the benefit of its Employees.
8. Death Benefits. The Employee's employment hereunder shall terminate
upon his death. Upon the Employee's death, the beneficiaries designated
by the Employee shall be entitled to the death benefits of any life
insurance policy for the Employee (not including any "key man" life
insurance policy, the benefits of which are payable to the Company)
paid for by the Company, but his estate shall not be entitled to any
further benefits under this Agreement, with the exception of anything
previously earned or accrued at the time of Employee's death.
9. Termination Without Cause or Resignation for Good Reason. The
Company may terminate the Employee without Cause during the Term by 20
days prior written notice to the Employee, and the Employee may resign
for Good Reason during the Term upon twenty (20) days prior written
notice (the "Resignation Notice") to the Company specifying the Good
Reason, provided, however, the Resignation Notice must be preceded by a
written warning ("Warning Notice") from the Employee to the Company
sent 25 days prior to the Resignation Notice, stating that Good Reason
exists and specifying the Good Reason. After the date of the Employee's
Warning Notice, the Company may cure the Good Reason within 20 days
and, if it elects to do so, shall so notify the Employee promptly.
After the first year of employment, if the Company terminates the
Employee's employment during the Term without Cause or if the Employee
Resigns for Good reason, the Company shall pay the Employee a lump sum
("Lump Sum Payment") equal to three (3) months' Base Salary.
The Lump Sum Payment is in lieu of, and not in addition to, any
severance or non-competition payment due or to become due to the
Employee under any separate agreement or contract between the Employee
and the Company or pursuant to any severance payment plan, program or
policy of the Company.
As a condition to the receipt of the Lump Sum Payment, the Employee and
the Company must first each execute and deliver to the other party a
bilateral mutual agreeable release releasing the Employee, the Company
and its affiliates, and the officers, managers, Employees and agents of
the Company and its affiliates, from any and all claims and from any
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and all causes of action of any kind or character that the Employee may
have arising out of the Employee's employment with the Company or the
termination of such employment.
10. Resignation Without Good Reason. In the event that the Employee
resigns from the Company at any time during the Term without Good
Reason, the Employee shall not be entitled to any additional
compensation for the time after which he ceases to work for the
Company, and shall not be entitled to any of the other benefits
provided hereunder nor any severance payment due or to become due to
the Employee under any separate agreement or contract between the
Employee and the Company or pursuant to any severance payment plan,
program or policy of the Company.
11. Non-Disclosure/Non-Compete.
a. Non-Disclosure of Confidential Information. Except in the course of
Employee's employment with the Company and in the pursuit of the
business of the Company or any of its subsidiaries or affiliates, the
Employee shall not, at any time during or following the Term, directly
or indirectly use for his own benefit or purpose, or disclose to a
third party or use for the benefit or purpose of any person or entity
other than the Company, any confidential information or proprietary
data of the Company or any of its subsidiaries or affiliates. The
Employee acknowledges that confidential information includes, among
other things, information regarding sales, costs, customers, Employees,
products, services, apparatus, equipment, processes, formulas,
marketing, or the organization, business or finances of the Company.
The Company and the Employee agree that as between them, all of the
confidential information constitutes important and material trade
secrets of the Company and affects the successful conduct of the
Company's business and its goodwill, and that any breach of any term of
this section is a material breach of this Agreement.
b. Non-Competition. The Employee acknowledges and recognizes the highly
competitive nature of the business of the Company and its affiliates
and subsidiaries and accordingly agrees that for a period of (A) one
year (if he is terminated for Cause or resigns without Good Reason) or
for a period of (B) six months (if he resigns for Good Reason or is
terminated without Cause) after the termination of the Employee's
employment with the Company, the Employee will not, (i) directly or
indirectly, as shareholder, consultant, employee, director, officer,
principal or agent, or in any other capacity, own, manage, operate,
consult with or be employed by a person or entity engaged in the
plumbing, fire protection, heating, ventilating, air conditioning
business or any other business engaged in by the Company or any of its
affiliates or subsidiaries (collectively, the "Competitive Business")
in any geographic area in which the Company or any of its affiliates or
subsidiaries conducts business (the "Territory"); (ii) assist any other
person or entity in engaging in any Competitive Business in the
Territory; (iii) solicit, attempt to solicit or do business on behalf
of a Competitive Business with any then or prior customers of the
Company in the Territory; or (iv) induce employees of the Company or
any affiliate or subsidiary of the Company to terminate their
employment with the Company or any such affiliate or subsidiary, as the
case may be, or hire any employees of the Company or any affiliate or
subsidiary of the Company to work with Employee or any business in
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which he is involved or affiliated with. This clause is in addition to
any other non-competition clauses the Employee has executed with Iron
Eagle or the Company. Competition only includes construction related
companies. This section does not preclude Employee from working for i)
companies in non-construction areas or ii) for finance companies as
long as it is not in the construction related area of that company.
c. Injunctive Relief. Employee agrees that the Company does not have an
adequate remedy at law for the breach of this Section 11 and agrees
that the Employee shall be subject to injunctive relief and equitable
remedies as a result of a breach of any provision of this Section 11.
The invalidity or unenforceability of any provision of this Section 11
(or this Agreement) shall not affect the force and effect of the
remaining valid portions.
d. Non-Solicitation Covenant. Parties agree that Company and Company
employees, consultants, clients, customers are valuable assets and are
difficult to replace. While the provisions of this Agreement are in
effect and for a period of twenty-four (24) months after termination,
Employee agrees that Employee will not directly or indirectly solicit
services or employment or in any manner persuade any employees,
consultants, or customers of Company or its parent company from
discontinuing that person or entity's relationship with the Company as
an employee, contractor, vendor or customer.
e. Ownership of Competitive Businesses. While acting as an Employee for
the Company, notwithstanding the foregoing, with the exception of Iron
Eagle, Employee may own, directly or in directly, solely as an
investment, up to five percent (5%) of any class of Publicly Traded
Securities of any person or entity which owns a competitive business.
For the purposes of this Agreement, the term "Publicly Traded
Securities" shall mean securities that are traded on a national
securities exchange or listed on the National Association of Securities
Dealers Automated Quotation System.
f. Non-disparagement. The Parties acknowledge the importance of
maintaining the privacy of Company and all individuals who have, will
have or have had any relationship with such organizations as a current
or former Employee, independent contractor, officer or director or
manager of such entities (the "Privacy Group"). For a period of
twenty-four (24) months after Termination, Employee and Company will
not disparage the Employee or Privacy Group in connection with
interviews, books and articles appearing in media, or participation on
a xxxxxxx xxxxxxxxxx show where any details other than the length of
Employee's employment and job title are discussed. Moreover, Parties
agree that the limitations and restrictions contained in this
subparagraph are part of the bargained for exchange and are reflected
in the consideration of the Parties under this Agreement.
g. Survival. This Section 11 shall survive the termination of the
Employee's employment hereunder and the expiration of this Agreement.
12. Payroll and Withholding Taxes. All payments to be made or benefits
to be provided hereunder by the Company shall be subject to applicable
federal, state and local payroll or withholding taxes, including, but
not limited to, withholding for social security, unemployment and any
other items which may be required by or authorized to be deducted by
applicable law.
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13. GOVERNING LAW. THE TERMS OF THIS AGREEMENT SHALL BE GOVERNED BY,
AND INTERPRETED AND CONSTRUED IN ACCORDANCE WITH THE PROVISIONS OF, THE
LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW
PRINCIPLES.
14. Disclosure. The Board and Employee acknowledge that Employee is
currently i) a Director of the Board of the Company, ii) a significant
shareholder of the Company, and iii) a member of Belle Haven Capital
and related entities. Unanimous Board approval is required in order
for this Agreement to become Effective. Consultant will not vote
during such approval.
15. Entire Agreement. This Agreement supersedes all other prior
agreements and understandings with respect to the matters covered
hereby including any previous consulting agreements.
16. No Oral Amendment. The amendment or termination of this Agreement
may be made only in a writing executed by the Company and the Employee,
and no amendment or termination of this Agreement shall be effective
unless and until made in such a writing.
17. Successors; Assignment. This Agreement shall be binding upon any
successor (whether direct or indirect, by purchase, merger,
consolidation, liquidation or otherwise) to all or substantially all of
the assets or stock of the Company, as well as to the surviving entity
in any merger between the Company and another entity or entities. This
Agreement is personal to the Employee and the Employee may not assign
any of his rights or duties hereunder, but this Agreement shall be
enforceable by the Employee's legal representatives, executors or
administrators.
18. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, and is shall
not be necessary in making proof of this Agreement to produce or
account for more than one such counterpart.
19. Modifications. No modification or alteration of any part of this
Agreement will be effective unless it is made in writing and signed by
Employee and the Chairman of the Board and approved by the Board. The
provisions of this Agreement are binding on all assigns and successors
in interest. Since employment involves personal services, we agree
that neither party may assign their rights or obligations hereunder.
20. Dispute Resolution.
a. Subject to the exceptions noted in this Paragraph, if Company and
Employee are unable to resolve any dispute on their own, both parties
agree to resolve the dispute in final and binding arbitration in front
of one arbitrator expert in areas relating to the dispute from the
Judicial Arbitration and Mediation Service ("JAMS") in accordance with
their then current employment arbitration rules. The venue for the
arbitration shall be New York City, New York.
b. Excluding any delay caused by JAMS, any arbitration contemplated
must be completed within 90 days of the filing of the arbitration
demand with JAMS. The arbitration hearing must be completed within a
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single day and the arbitrator must provide a written opinion specifying
the reasons for the decision in writing within 10 business days of the
arbitration hearing.
c. This provision is self executing and in the event that either party
fails to appear at any properly noticed arbitration proceeding, an
award may be entered against such party notwithstanding said failure to
appear. Any arbitration award shall be enforceable by any court of
competent jurisdiction.
d. Notwithstanding the foregoing, any claim relating to the validity of
any Confidential Information or any other proprietary technology or
intellectual property shall not be determined by arbitration, but only
by a Federal District Court located in New York City, New York. We
also agree that any breach of the obligations under this Agreement
which relates to proprietary rights or Confidential Information or
which is otherwise not subject to remedy by monetary damages that will
cause irreparable harm will be entitled to injunctive relief in
addition to all other remedies provided in this Agreement or available
at law, in any court of competent jurisdiction.
e. Parties agree that any claim for arbitration must be submitted to
arbitration within the earlier of 12 months of termination of the
termination date of the employment or 12 months from the date of
discovery. Any claim submitted beyond this period, Parties agree is
void.
f. Employee agrees that the provisions of this Paragraph will apply if
Employee has any dispute with any current or former Company employee or
board member relating directly or indirectly to Employee's work with
the Company.
g. This Paragraph will survive termination of this Agreement.
IN WITNESS WHEREOF, the parties have the authority and have caused this
Agreement to be executed as of the day and year first written above.
By: /s/Xxxxx X. Xxxxxxx
------------------------
Xxxxx X. Xxxxxxx, an individual
Date: 1/20/11
IN WITNESS WHEREOF, the parties have the authority and have caused this
Agreement to be executed as of the day and year first written above.
Iron Eagle Group, Inc.
By: /s/Xxxx X. Xxxxxxxxx
Name: Xxxx X. Xxxxxxxxx
Title: Director
Date: 1/21/11
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