EXHIBIT 10.11
EMPLOYMENT AGREEMENT
This Employment Agreement dated as of February 10, 2005 (hereinafter referred to
as "Agreement") is entered into by and among FuelNation Inc. (the "Company") and
Xxxx X. Xxxxxxxxxx ("Executive").
WHEREAS, the Company employs Executive in the capacity of Vice President and
Chief Investment Officer; and
WHEREAS, the Company and Executive desire to set forth in this Agreement all of
the terms and conditions of said employment, and to establish a mechanism to
resolve disputes relating to said employment;
NOW, THEREFORE, in consideration of the mutual promises and obligations
contained in this Agreement, the Company and Executive agree as follows:
1. TERM OF EMPLOYMENT. This Agreement is effective March 1, 2005 (the "Effective
Date"), and will continue, unless sooner terminated, until March 1, 2008 (the
"Initial Term"). Thereafter, the term of this Agreement shall automatically be
extended for successive one (1) year periods ("Renewal Terms") unless either the
Company or Executive gives written notice to the other at least ninety (90) days
prior to the end of the Initial Term or Renewal Term, as the case may be, of its
or his intention not to renew the term of this Agreement. The Initial Term and
any Renewal Terms of this Agreement shall be collectively referred to as the
"Term."
2. DUTIES AND RESPONSIBILITIES. The Company hereby employs Executive as Vice
President and Chief Investment Officer with such powers and duties in that
capacity as may be established from time to time by the Company in its
discretion. Executive will devote his entire time, attention and energies to the
Company's business. Executive, subject to approval by the Company's Board of
Directors, may in the future have other business investments and participate in
other business ventures which may, from time to time, require portions of his
time, but shall not interfere with his duties hereunder. However, nothing in
this Agreement shall prevent Executive from passively investing in business
activities so long as such investments require no active participation by
Executive.
3. COMPENSATION.
(a) BASE SALARY. The Company will pay Executive an annualized base salary of
$125,000 until March 31, 2006 and $150,000 until March 31, 2007 and $200,000 for
the remainder of the Initial Term, less applicable deductions, payable in
installments according to the Company's normal payroll practices ("Base
Salary"). The Base Salary shall be reviewed at least annually by the Company's
Board of Directors, which may in its discretion increase the Base Salary.
Participation in deferred compensation, discretionary bonus, retirement, stock
option and other employee benefit plans and in fringe benefits shall not reduce
the Base Salary payable to Executive under this Section 3(a).
1
(b) BONUSES: During the term of this Agreement, the Executive shall receive an
annual bonus from the Company, based on performance goals determined at the
beginning of each fiscal year by the Executive and Board of Directors of the
Company, in its good faith discretion.
(c) VACATION. Executive shall be entitled to four (4) weeks of paid vacation
during each year of the Term, the time and duration thereof to be determined by
mutual agreement between Executive and the Company.
(d) STOCK OPTIONS. FuelNation shall grant to Executive stock options to purchase
an aggregate of 150,000 shares of common stock at prices to be determined by the
Board of Directors. The options shall vest in equal installments on March 1,
2006, 2007 and 2008. The options will only vest assuming that Executive remains
employed by Company on the dates that the options are to be deemed vested. There
will be no "pro-rated" vesting of any options for the period in which Executive
ceases to be employed by Company. Executive will have five (5) years to exercise
all vested options.
(e) AUTOMOBILE. The Company shall reimburse Executive with car expenses to
include monthly lease and insurance payments not to exceed $500 per month
commencing March 1, 2005 for the remaining term of his employment.
(f) EXPENSES. The Company shall pay or reimburse the Executive for all
reasonable expenses which are actually incurred or paid by him in the
performance of his service hereunder.
(g) PARTICIPATION IN RETIREMENT AND EMPLOYEE BENEFIT PLANS; FRINGE BENEFITS.
Executive shall be entitled to participate in all plans of FuelNation relating
to stock options, stock purchases, pension, thrift, profit sharing, life
insurance, hospitalization and medical coverage, disability, travel or accident
insurance, education or other retirement or employee benefits that FuelNation
has adopted or may adopt for the benefit of its senior executives. In addition,
Executive shall be entitled to participate in any other fringe benefits, such as
club dues, legal and tax planning expenses (up to $5,000 per year) and fees of
professional organization and associations, which are now or may become
applicable to the Company's senior executives, and any other benefits which are
commensurate with the duties and responsibilities to be performed by Executive
under this Agreement. Executive shall, during the term of his employment
hereunder, continue to be provided with benefits at a level which shall in no
event be less in any material respect than the benefits available to the
Executive immediately prior to the date of this Agreement. Notwithstanding the
foregoing, the Company may terminate or reduce benefits under any benefit plans
and programs to the extent such reductions apply uniform to all senior
executives entitled to participate therein, and Executive's benefits shall be
reduced or terminated accordingly.
4. INABILITY TO PERFORM JOB DUTIES. In the event of Executive's death, this
Agreement and the Executive's salary and compensation shall automatically end.
If in the reasonable judgment of the Board of Directors, based on independent
medical advice, Executive becomes unable to perform his employment duties during
the term of this Agreement as a result of mental or physical incapacity, illness
or disability, his compensation under this Agreement shall automatically end
2
until such time as Executive becomes able to resume his job duties for the
Company. In the event that Executive becomes unable to perform his employment
duties for a cumulative period of greater than twelve (12) weeks within any span
of twelve (12) months, this Agreement and Executive's employment will be
automatically terminated. In either event, Executive will be immediately
entitled to all accrued and unpaid payments and benefits under Section 3 and the
Company shall continue to provide the Executive with those medical, life and
disability insurance benefits, if any, which are provided to the Executive on
the last day of his employment by the Company for a period of one year following
the last day of employment with the Company.
5. TERMINATION BY COMPANY FOR CAUSE. The Company may terminate this Agreement,
and Executive's employment "for cause" at any time. As used herein, "for cause"
shall mean any one of the following: The conviction of or a plea of guilty or
nolo contendere by Executive to a felony; Willful fraud or deceit of material
fact by Executive in connection with the performance of his duties hereunder;
Commission of a serious and willful violation of any of the Company's personnel
policies, including but not limited to violations of the Company's policies
against any form of harassment, which violation cannot be cured, or is not cured
within fifteen (15) days following (a) receipt by Executive of a written notice
specifying the factors or events constituting such failure or refusal and (b) a
reasonable opportunity to cure such violation; or Failure of or refusal on the
part of Executive to substantially perform all of his duties hereunder as
reasonably requested by the Company, which failure or refusal shall not be cured
within fifteen (15) days following (a) receipt by Executive of a written notice
specifying the factors or events constituting such failure or refusal, and (b) a
reasonable opportunity for Executive to correct such deficiencies. In the event
the Company terminates Executive's employment for Cause, Executive shall not be
entitled to severance, but will immediately be entitled to all accrued and
unpaid payments and benefits under Section 3.
6. TERMINATION OF AGREEMENT BY COMPANY WITHOUT CAUSE OR BY EXECUTIVE FOR GOOD
REASON. The Company may terminate this Agreement and Executive's employment
without Cause at any time upon Sixty (60) days prior written notice to
Executive. The Executive may terminate this Agreement and Executive's employment
with Good Reason at any time upon Sixty (60) days prior written notice to the
Company. "Good Reason" shall mean any of the following if the same shall occur
without Executive's express prior written consent: (i) the failure by the
Company to obtain the assumption by operation of law or otherwise of this
Agreement by any entity which is the surviving entity in any merger or other
form of reorganization involving the Company or by any entity which acquires all
or substantially all of the Company's assets, or (ii) any other material breach
of this Agreement by the Company, which breach shall not be cured within fifteen
(15) days after written notice thereof to the Company. If the Company terminates
Executive's Employment without Cause or Executive terminates his employment with
the Company for Good Reason, the Company will pay to Executive a severance
payment of an amount equal to 2.99 times his then-current Base Salary. In
addition, all unvested stock options owned by the Executive shall become fully
vested and exercisable at the date Executive's employment terminates, and
Executive shall have the right to exercise all vested, unexercised stock options
outstanding at the termination date (including the accelerated options) in
accordance with the terms of the plans and agreements pursuant to which such
options were issued. Executive shall also immediately be entitled to all accrued
and unpaid payments and benefits under Section 3.
3
7. TERMINATION OF AGREEMENT BY EXECUTIVE. Executive may terminate this Agreement
and his employment with the Company without Good Reason upon Sixty (60) days
prior written notice to the Company. Executive may be required to perform his
job duties and will be paid his regular salary up to the date of the
termination. At the option of the Company, the Company may require Executive to
terminate employment upon receiving said Sixty (60) days' notice from Executive
of the termination of this Agreement. In such event, the Company will pay to
Executive an amount equal to Sixty (60) calendar days of his base salary and
benefits. Executive will not be entitled to receive any other compensation or
severance allowance under this Agreement.
8. CHANGE OF CONTROL.
(a) For the purposes of this Agreement, a "Change of Control" shall be deemed to
have taken place if: (i) any person, including a "group" as defined in Section
13(d)(3) of the Securities Exchange Act of 1934, as amended (but excluding
Executive and members of his family), becomes the owner or beneficial owner of
Company securities, after the date of this Agreement, having 50% or more of the
combined voting power of the then outstanding securities of the Company that may
be cast for the election of directors of the Company (other than as a result of
an issuance of securities initiated by the Company, or open market purchases
approved by the Board, as long as the majority of the Board approving the
purchases is the majority at the time the purchases are made), or (ii) the
persons who were directors of the Company before such transactions shall cease
to constitute a majority of the Board, or any successor to the Company, as the
direct or indirect result of or in connection with, any cash tender or exchange
offer, merger or other business combination, sale of assets or contested
election, or any combination of the foregoing transactions.
(b) During the remaining term hereof after the Change of Control Date, the
Company (or subsidiary) will (i) continue to pay Executive at not less than the
Base Salary on the Change of Control Date, (ii) pay Executive bonuses in amounts
not less in amount than those paid during the 12 month period preceding the
Change of Control Date, and (iii) continue employee benefit programs as to
Executive at levels in effect on the Change of Control Date (but subject to such
reductions as may be required to maintain such plans in compliance with
applicable federal law regulating employee benefit programs).
(c) If during the remaining term hereof after the Change of Control Date (i)
Executive's employment is terminated by the Company (or subsidiary), or (ii)
there shall have occurred a material reduction in Executive's compensation or
employment related benefits, or a material change in Executive's status, working
conditions, management responsibilities or titles, and Executive voluntarily
terminates his relationship with the Company within 60 days of any such
occurrence, or the last in a series of occurrences, then Executive shall be
entitled to receive, a lump sum payment equal to the remainder of Executive's
Base Salary, but no less than 18 months of salary. Such amount will be paid to
Executive within 15 business days after his termination of affiliation with the
Company.
4
9. COOPERATION. Upon the termination of this Agreement for any reason, Executive
agrees to cooperate with the Company in effecting a smooth transition of the
management of the Company with respect to the duties and responsibilities which
Executive performed for the Company. Further, after termination of this
Agreement, Executive will furnish such information and proper assistance to the
Company as it may reasonably require in connection with any prior business
arrangements in which Executive was involved, and any litigation to which the
Company is or may become party.
10. COVENANT NOT TO COMPETE. During the term of this Agreement, and for two (2)
years after its termination, Executive promises and agrees that she/he will not
enter into any employment or business relationship (whether as a principal,
agent, partner, employee, investor, owner, consultant, board member or
otherwise) with any company, business organization or individual whose primary
business that is engaged in the same or similar business as that conducted by
the Company or with any other business that competes with the Company. This
Section 10 is effective regardless of the reason for the termination of the
Agreement and regardless of whether the Agreement is terminated by the Executive
or the Company. This restrictive covenant may be assigned to and enforced by any
of the Company's assignees or successors. It is expressly understood, however,
that Employee has a relationship with Agra Technologies and a relationship with
Regent Ventures. Employee is free to simultaneously pursue these opportunities
as long as these entities do not compete in the Company's business and as long
as Employee devotes at least 25 hours per week to the business of Company.
Employee, however, is not free to pursue opportunities other than these
mentioned in this paragraph.
11. INDEMNIFICATION AND HOLD HARMLESS. In the event that a claim arises out of
Employee's relationship with Agra Technologies or Regent Ventures, Employee
agrees to indemnify the Company and hold it harmless from any such claim.
Employee also agrees under that in such event, Employee will reimburse Company
its attorney fees and costs used in defending such claim.
12. AGREEMENT NOT TO USE OR DISCLOSE TRADE SECRETS. During the term of this
Agreement and a period of five (5) years thereafter, Executive promises and
agrees that he/she will not disclose or utilize any trade secrets acquired
during the course of service with the Company and/or its related business
entities. As used herein, "trade secret" refers to the whole or any portion or
phase of any formula, pattern, device, combination of devices, or compilation of
information which is for use, or is used, in the operation of the Company's
business and which provides the Company an advantage, or an opportunity to
obtain an advantage, over those who do not know or use it. "Trade secret" also
includes any scientific, technical, or commercial information, including any
design, list of suppliers, list of customers, as well as pricing information or
methodology, contractual arrangements with vendors or suppliers, business
development plans or activities, or Company financial information. This Section
11 is effective regardless of the reason for the termination of the Agreement
and regardless of whether the Agreement is terminated by the Executive, the
Company or by its own terms. This restrictive covenant may be assigned to and
enforced by any of the Company's assignees or successors.
5
13. AGREEMENT NOT TO USE OR DISCLOSE CONFIDENTIAL OR PROPRIETARY INFORMATION.
During the term of this Agreement and a period of two (2) years thereafter,
Executive promises and agrees that he/she will not disclose or utilize any
confidential or proprietary information acquired during the course of service
with the Company and/or its related business entities, Executive shall not
divulge, communicate, use to the detriment of the Company or for the benefit of
any other person or persons, or misuse in any way, any confidential or
proprietary information pertaining to the business of the Company. Any
confidential or proprietary information or data now or hereafter acquired by
Executive 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, methods of doing business and
promotion of the Company's products and services) shall be deemed a valuable,
special and unique asset of the Company that is received by Executive in
confidence and as a fiduciary. For purposes of this Agreement "confidential and
proprietary information" means information disclosed to Executive as a
consequence of or through his employment by the Company (including information
conceived, originated, discovered or developed by Executive) prior to or after
the date hereof and not generally known or in the public domain, about the
Company or its business. This Section 12 is effective regardless of the reason
for the termination of the Agreement and regardless of whether the Agreement is
terminated by the Executive, the Company or by its own terms. This restrictive
covenant may be assigned to and enforced by any of the Company's assignees or
successors.
14. AGREEMENT NOT TO HIRE COMPANY EXECUTIVES. If Executive leaves the employ of
the Company or terminates this Agreement, Executive promises and agrees that,
during the two (2) years following his departure from the Company, Executive
will not, without the express written permission of the Company, actively
recruit or solicit employees of the company. This Section 13 is effective
regardless of the reason for the termination of the Agreement and regardless of
whether the Agreement is terminated by the Executive, the Company or by its own
terms. This restrictive covenant may be assigned to and enforced by any of the
Company's assignees or successors.
15. INJUNCTIVE RELIEF. In recognition of the unique services to be performed by
Executive and the possibility that any violation by Executive of Section 10,
Section 11, Section 12 or Section 13 of this Agreement may cause irreparable or
indeterminate damage or injury to Company, Executive expressly stipulates and
agrees that the Company shall be entitled, upon ten (10) days written notice to
Executive, to obtain an injunction from any court of competent jurisdiction
restraining any violation or threatened violation of this Agreement. Such right
to an injunction shall be in addition to, and not in limitation of, any other
rights or remedies the Company may have for damages.
16. JUDICIAL MODIFICATION OF AGREEMENT. The Company and Executive specifically
agree that a court of competent jurisdiction (or an arbitrator, as appropriate)
may modify or amend Section 10, Section 11, Section 12 or Section 13 of this
Agreement if absolutely necessary to conform with relevant law or binding
judicial decisions in effect at the time the Company seeks to enforce any or all
of said provisions.
6
17. RESOLUTION OF DISPUTES BY ARBITRATION. Any claim or controversy that arises
out of or relates to Executive's employment, this Agreement, or the breach of
this Agreement, will be resolved by arbitration in Palm Beach County in
accordance with the rules of the American Arbitration Association. Judgment upon
the award rendered by the arbitrator may be entered in any court possessing
jurisdiction over arbitration awards. This Section shall not limit or restrict
the Company's right to obtain injunctive relief for violations of Section 9,
Section 10, Section 11 or Section 12 of this Agreement directly from a court
under Section 14 of this Agreement. Each party shall be required to bear its own
costs and attorney's fees incurred in any arbitration arising out of Executive's
employment, this Agreement, or the breach of this Agreement.
18. TERMINATION OF CERTAIN PROVISIONS. The provisions of paragraph 10 and 13
shall no longer apply if the Company shall file a petition for bankruptcy or if
an involuntary petition is filed against the Company that is not dismissed
within 60 days.
19. ADEQUATE CONSIDERATION. Executive expressly agrees that the Company has
provided adequate, reasonable consideration for the obligations imposed upon him
in this Agreement.
20. ENTIRE AGREEMENT. This Agreement sets forth the entire agreement between the
parties, and supersedes any prior agreements or understanding between the
Company and Executive. This Agreement may be amended only in writing, signed by
both parties.
21. LIMITED EFFECT OF WAIVER BY COMPANY. If the Company waives a breach of any
provision of this Agreement by Executive, that waiver will not operate or be
construed as a waiver of later breaches by Executive.
22. SEVERABILITY. If any provision of this Agreement is held invalid for any
reason, such invalidity shall not affect the enforceability of the remainder of
this Agreement.
23. ASSUMPTION OF AGREEMENT BY COMPANY'S SUCCESSORS AND ASSIGNS. At the
Company's sole option, the Company's rights and obligations under this Agreement
will inure to the benefit and be binding upon the Company's successors and
assigns. Executive may not assign his rights and obligations under this
Agreement.
24. APPLICABLE LAW. Executive and the Company agree that this Agreement shall be
subject to, and enforceable under, the laws of the State of Florida.
IN WITNESS WHEREOF, the parties have executed this Employment Agreement on
February 10, 2005.
COMPANY EXECUTIVE
------------------ -----------------------------
Xxxxx X. Xxxxxxxxx Xxxx X. Xxxxxxxxxx, President
7
