Exhibit 10.16
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made and entered into as of May 30, 1998, by and
between U.S. Engineering Labs, Inc., a Delaware corporation ("Company"), and
Xxxxxx X. Xxxxxxxxx, an adult resident of New Jersey ("Executive").
RECITALS:
A. Executive is presently an employee of Company.
B. Company and Executive desire to memorialize the terms of
Executive's employment pursuant to a written agreement.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:
1. EMPLOYMENT. Subject to all of the terms and conditions hereof,
Company hereby employs Executive for the term of this Employment Agreement, and
Executive hereby accepts such employment. Executive agrees to devote his entire
working time, energy and skills to such employment during the Employment Term
(as defined in Section 2), and shall not, during the Employment Term, render any
services of a business, commercial or professional nature to any person or
organization other than Company or be engaged in any other business activity,
without the prior written consent of the Board of Directors.
2. TERM. Executive's employment hereunder shall commence on the date
hereof and shall continue through the third anniversary of this Employment
Agreement unless earlier terminated as provided in Section 8 (the "Employment
Term"). The Company may not terminate Executive's employment prior to the third
anniversary of this Agreement except as set forth in Section 8.
3. DUTIES; OFFICES. Executive shall serve as President of the Company
and will, under the direction of the Board of Directors, faithfully and to the
best of his ability perform the duties of President. In such capacity, he shall
have primary responsibility for overseeing the business affairs of the Company,
and shall perform such executive duties as generally are associated with the
position of President, together with such further and additional duties of an
executive nature as from time to time reasonably may be assigned to him by the
Board of Directors. Such duties shall be rendered at such place or places as
the Board of Directors shall in good faith require. The Executive agrees to
serve without additional compensation, if elected or appointed thereto, in one
or more offices or as a director of the Company.
4. SALARY. In consideration of the services to be rendered by Executive
hereunder, the Company shall pay Executive a salary during the Employment Term
at an annual rate of
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Seventy Thousand Dollars ($70,000) (the "Base Salary"). The Base Salary shall
be paid to Executive in installments in accordance with the payroll
procedures of the Company as established from time to time.
5. INSURANCE. During the Employment Term, Executive shall be entitled to
participate, to the extent he meets all eligibility requirements of general
application, in all employee benefit plans maintained by Company and made
available to all other regular salaried employees of Company including, but not
limited to, group hospitalization, medical and disability plans.
6. EXECUTIVE EXPENSES. During the Employment Term, Executive shall be
entitled to be reimbursed for reasonable and necessary expenses incurred by him
in the performance of his duties hereunder and approved by Company including,
but not limited to, expenses for entertainment, travel, meals, hotel
accommodations, professional seminars and telephone expenses, subject to the
submission by Executive of the documentation necessary to support the
deductibility of such expenses by Company on its federal and state income tax
returns, in such form as Company may require.
7. VACATION. During the Employment Term, Executive shall be entitled to
paid vacations in accordance with Company's standard vacation policies in effect
from time to time relating to managerial and executive employees and, in
addition, shall be entitled to such holidays as are made available generally to
executive employees of Company.
8. TERMINATION. The employment of Executive hereunder shall be
terminated prior to the third anniversary of this Agreement upon the happening
of any of the following:
a. the death of Executive.
b. the disability of Executive, where disability means any illness,
disability or incapacity of such a character as to render Executive unable
to perform his duties hereunder (which determination shall be made by the
Board of Directors) for a total period of ninety (90) days, whether or not
such days are consecutive, during any consecutive twelve (12) month period
or the certification by a New Jersey licensed physician that Executive is
unlikely to be able to resume performance of substantially all of his
duties hereunder for a period of ninety (90) days.
c. the termination of this Agreement by Company for cause, where
cause means (i) the inability of Executive to perform his duties due to a
legal impediment such as, without limitation, the entry against Executive
of an injunction, restraining order or other type of judicial judgment,
decree or order which would prevent or hinder Executive from performing his
duties; (ii) a breach of any of the restrictions or covenants set forth in
this Agreement; (iii) excessive absenteeism, material or serious neglect of
his duties hereunder, serious misconduct, conviction of a felony or fraud,
or the entry by Executive of a nolo contendere plea in such proceeding, or
(iv) aiding a competitor of the Company to the detriment of the Company.
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d. the termination of this Agreement by Company at the Company's
election (subject to the provisions of Section 9) for reasons other than
death, permanent disability or cause.
9. PAYMENTS FOLLOWING TERMINATION. Upon any termination of this
Agreement, the Company shall pay to Executive that portion of the Base Salary
which he earned for services performed up to the effective date of termination
for which he has not previously been compensated. In addition, upon any
termination pursuant to Section 8(d), the Company also shall pay to Executive an
amount (the "Severance Amount") equal to fifty percent (50%) of Base Salary.
The Severance Amount shall be paid to Executive in twelve (12) equal monthly
installments, beginning on the first day of the month following the effective
date of Executive's termination.
10. CONFIDENTIALITY.
a. Executive recognizes and acknowledges that the business of the
Company is highly competitive and that during the course of his employment
he will have access to significant proprietary and confidential information
belonging to the Company. Executive therefore covenants and agrees, for
the duration of this Agreement and at all times following its termination,
that he will not use (other than in furtherance of the Company's business
interests during the Employment Term) or disclose any confidential
proprietary information of the Company, including, but not limited to
patents, patent rights, inventions and intellectual property rights,
techniques, know-how, trade secrets, software, technical designs,
trademarks, trademark rights, tradenames, tradename rights, copyrights,
customer and supplier lists, manufacturing processes, business plans,
strategic plans, marketing information and other business and financial
information of or related to the Company.
b. The obligations of Executive under this Section 10 shall not
apply to any information which (i) was part of the public domain prior to
the date of this Agreement other than as a result of unauthorized
disclosure by Executive, (ii) becomes part of the public domain by reason
of disclosure by some third person who did not acquire the information from
Executive, or (iii) becomes part of the public domain by reason of
disclosure by Executive where such disclosure is made during the Employment
Term in furtherance of the Company's business interests.
c. Executive agrees that any violation of the provisions of this
Section would be likely to be highly injurious to the Company. By reason
of the foregoing, Executive consents and agrees that, if he violates any of
the provisions of this Section, the Company shall be entitled, in addition
to any other rights and remedies that it may have, including money damages,
to an injunction prohibiting Executive from engaging in any such act or
specifically enforcing this Agreement, as the case may be.
11. ASSIGNMENT. The Company may assign its rights and obligations under
this Agreement. Executive may not assign his rights and obligations under this
Agreement;
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provided, however, that Executive shall be entitled to assign his right to
any accrued payments under this Agreement to his heirs or personal
representatives in the event of his death.
12. COVENANT NOT TO COMPETE.
a. Executive agrees that during the Employment Term and for a period
of two (2) years thereafter, Executive shall not, as proprietor, director,
officer, partner, shareholder, employee, member, manager, consultant,
agent, independent contractor or otherwise, for himself or on behalf of any
other person or entity (except the Company or an affiliate of the Company,
in either case at the Company's request), directly or indirectly:
i. engage in, or enter into, any aspect of the business of
engineering inspection and testing in New Jersey, Pennsylvania, New
York, or Connecticut;
ii. solicit persons who shall have been customers or suppliers
of the Company during the period beginning two (2) years prior to
the date of this Agreement or who are, at the time of such
solicitation, current or prospective customers or suppliers of the
Company or take any other action the effect of which is to
interfere with the business relationship between the Company and
such customers or suppliers; or
iii. hire persons who shall have been employees of the Company
during the period beginning on the date of this Agreement, or
otherwise interfere with the relationship between the Company and
any such persons.
b. The covenants of Executive contained in this Section 12 shall be
construed as separate agreements independent of any other agreement for
purposes of enforceability of any claim or cause of action, whether
predicated on this Agreement or otherwise. No other agreement, claim or
cause of action asserted by Executive shall constitute a defense to the
enforcement of such covenants. Executive acknowledges that damages for the
violation of any such covenants will not give full and sufficient relief to
the Company, and agrees that, in the event of any violation of any such
covenants, the Company shall be entitled to injunctive relief against the
continued violation thereof, in addition to any other rights that the
Company may have by reason of such violation.
13. NOTICES. All notices, demands or other communications required or
provided hereunder shall be in writing and shall be deemed to have been given
and received when delivered in person or transmitted by facsimile transmission
to the respective parties, or five (5) days after dispatch by certified mail,
postage prepaid, addressed to the parties at the addresses set forth below or at
such other addresses as such parties may designate by notice to the other
parties:
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If to Company: U.S. Engineering Laboratories, Inc.
c/o U.S. Laboratories Inc.
0000 Xxxxxx Xxxxx, Xxxxx 00
Xxx Xxxxx, Xxxxxxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Attention: Xxxxxxxxx Xxxxxx
If to Executive: Xxxxxx X. Xxxxxxxxx
000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Telecopier: (______) ________ - __________
Telephone: (______) ________ - __________
14. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the internal laws of New Jersey without giving effect to
conflict of laws principles thereof.
15. SEVERABILITY. If any provision of this Agreement shall be held
invalid or unenforceable, the remainder shall nevertheless remain in full force
and effect. If any provision is held invalid or unenforceable with respect to
particular circumstances, it shall nevertheless remain in full force and effect
in all other circumstances.
16. ENTIRE AGREEMENT. This Agreement represents the entire understanding
of the parties with respect to the subject matter hereof, and no other
representations, promises, agreements or understandings regarding the subject
matter hereof shall be of any force or effect unless in writing, executed by the
party to be bound, and dated subsequent to the date hereof. This entire
Agreement supercedes any existing Employment Agreement in its entirety.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
COMPANY:
U.S. Engineering Laboratories, Inc.
By: /S/ Xxxxxxxxx Xxxxxx
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Xxxxxxxxx Xxxxxx, Chairman
EXECUTIVE:
/S/ Xxxxxx X. Xxxxxxxxx
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Xxxxxx X. Xxxxxxxxx
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