Exhibit 10.11.2
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EMPLOYMENT AGREEMENT
---------------------
AGREEMENT, made effective the 1st day of October, 1996 (the
"Effective Date") between American Eco Corporation, an Ontario
Company ("Company"), having its principal office at 00000 Xxxxx
Xxxx, Xxxxxxx, Xxxxx 00000; and Xxxxx Xxxxxxxx, an individual
("Employee") residing at _________________________,
_________________, Massachusetts ______________________.
WHEREAS, Company desires to retain the services of Employee
to serve as an Executive Vice President and Chief Operating
Officer of Company; and
WHEREAS, Employee is willing to serve as an Executive Vice
President and Chief Operating Officer of Company, all upon the
terms and subject to the conditions hereinafter set forth; and
NOW, THEREFORE, in consideration of the premises, and the
mutual covenants herein contained, the parties hereby agree as
follows:
A. Employment.
-----------
1. Throughout the effective term of this Agreement,
Company shall employ Employee and Employee shall render services
to Company, its subsidiaries and affiliates, and the businesses
heretofore and hereafter conducted by Company in the capacity and
with the title of Executive Vice President and Chief Operating
Officer of Company. Employee shall perform all services, acts or
things necessary or advisable to manage, supervise and conduct
the day-to-day operations of Company, its subsidiaries and
affiliates, such duties to include, without limitation, the
responsibility for and management of strategic planning,
budgeting, insurance and risk evaluation, human resources, job
cost and inventory accounting systems, and hiring and termination
of operational personnel, including the chief executives of all
subsidiaries, subject to the policies established from time to
time by the Chief Executive Officer or by the Board of Directors.
Employee shall have full authority to act on behalf of the
Company, except to the extent limited by the Bylaws of the
Company.
2. Throughout the period of his employment hereunder,
Employee shall devote all of his business time, attention,
knowledge and skills, faithfully, diligently and to the best of
his ability, to the active performance of his duties hereunder.
B. Term of Employment: Termination of Agreement.
--------------------------------------------
1. Subject to the earlier termination of this
Agreement in accordance with the terms hereof, the term of this
Agreement shall commence, effective as of October 1, 1996 (the
"Commencement Date") and the term of this Agreement shall
continue through and include September 30, 2001 (the "Termination
Date").
2. Anything contained in Section 1 to the contrary
notwithstanding, this Agreement may be terminated at the option
of Company for "Cause" (as herein defined), effective upon the
giving of written notice of termination to Employee. As herein
used, the term for "Cause" shall mean and be limited to:
(a) any act committed by Employee against
Company, its subsidiaries, divisions or affiliates constituting:
(A) fraud, (B) misappropriation of corporate opportunity, (C)
self-dealing, (D) embezzlement of funds, (E) criminal felony
conviction, or (F) the continued disregard by Employee of the
reasonable directions and policies of the Chief Executive Officer
or the Board of Directors of Company, provided that such
disregard or non-compliance by Employee continues for a period of
five (5) days after written notice thereof is delivered to the
Employee by the Chief Executive Officer or the Board of Directors
of Company; or
(b) the breach or default by Employee in the
performance of any material covenant on the part of Employee to
be performed under this Agreement; or
(c) chronic alcoholism or any other form of
addiction which impairs Employee's ability to perform his duties
hereunder.
3. Anything contained in Section 1 to the contrary
notwithstanding, this Agreement may be terminated by Company (i)
upon the death of Employee, or (ii) on ten (10) days' prior
written notice to Employee, in the event that Employee shall be
physically or mentally disabled or impaired so as to prevent him
from continuing the normal and proper performance of his duties
and responsibilities hereunder for a period of three (3)
consecutive months.
The initial determination as to whether Employee is
disabled or impaired shall be made by the physician regularly
treating the condition causing the disability. Company shall
have the right to require Employee to be examined by a physician
duly licensed to practice medicine and surgery in the State of
Texas to determine such physician's opinion as to Employee's
disability. If such physician's opinion differs from that of the
physician treating Employee, or a physician thereafter retained
by Employee, they shall forthwith select a third physician so
licensed whose opinion, after examination and review of available
information, shall be conclusive and binding upon all parties
thereto. All costs of the physician regularly treating or
thereafter retained by Employee shall be paid by Employee. All
costs of the physician retained by Company shall be paid by
Company. If a third physician is required, then the costs of
that physician shall be paid by Company.
4. Upon any termination of this Agreement by Company
as a result of Employee's death or permanent disability pursuant
to Section 3, Company shall be liable for, and shall pay or shall
cause to be paid to Employee or his personal representative, as
the case may be, Employee's Base Salary for an additional six (6)
months period from the date of termination less (in the case of
permanent disability), any health and disability insurance
payments made to or on behalf of Employee during such six (6)
month period.
5. Upon any termination of this Agreement by Company
for Cause pursuant to Section 2, above, neither Company nor any
shareholder, subsidiary or division thereof shall be liable for
or shall pay or cause to be paid to Employee any further
remuneration, compensation or other benefits hereunder.
6. If Company terminates Employee for any reason
other
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than as provided: (a) in Section 2, (b) in Section 3, or (c) as
a result of Employee's voluntary resignation of employment (not
constituting a constructive discharge), Company shall be
obligated to pay or shall cause to be paid to Employee the Base
Salary, as and when the same would have otherwise become due and
payable hereunder for a period of six (6) months after the date
of termination, unless Employee is re-employed or earns business
income prior to six (6) months after the termination date, in
which event the Company's obligations hereunder shall be reduced
by the amount of such compensation or business income. In
addition, the balance of the promissory note, described in
Section 1-7, below, shall be forgiven by Company and Employee
shall be released from liability for re-payment of said
promissory note.
7. This contract may be terminated by Employee at any
time by giving sixty (60) days prior written notice of
termination to the Company. In such event, Employee shall be
entitled to the Base Salary earned by the Employee prior to the
date of termination, computed pro rata up to and including the
Termination Date. Employee shall not be entitled to any other
compensation after the date of termination. All unexercised
stock options as the Termination Date shall be tested or
forfeited as provided in the Company's stock option plan.
8. Notwithstanding any termination of this Agreement,
whether with cause or without cause, and whether by Company or by
Employee, the provisions of Section D, below, shall remain
effective and binding on the parties to this Agreement.
C. Compensation; Expenses; Fringe Benefits.
----------------------------------------
1. Base Salary.
----------- As compensation for his services to
be rendered hereunder, Company shall pay or cause to be paid to
Employee for the period commencing as of the Commencement Date
and ending on the Termination Date, a salary at the rate of
Twenty Thousand Eight Hundred Thirty-Three and 33/100
($20,833.33) Dollars per month, payable in arrears on the 15th
day and last day of each month (said payment being hereinafter
referred to as the "Base Salary"). The Base Salary described
herein may from time to time during the term of this Agreement be
increased, by action of the Chief Executive Officer or the Board
of Directors of Company, but no such action shall ever operate to
decrease the amount of Base Salary described herein, without the
written consent of Employee.
2. Expenses.
---------- In addition to the remuneration set
forth above, throughout the period of Employee's employment
hereunder, Company shall also reimburse, or cause to be
reimbursed to Employee, upon presentment by Employee to Company,
as applicable, of appropriate receipts and vouchers therefor, for
any reasonable business expenses, including air and other travel
expenses, incurred by Employee in connection with the performance
of his duties and responsibilities hereunder;
3. Fringe Benefits.
--------------- Company shall also make
available, or cause to be made available, to Employee, throughout
the period of his employment hereunder, such benefits, including
any disability, hospitalization, medical benefit plan, pension
plan or other benefits or policies, as are put into effect by
Company for its other executive employees.
4. Vehicle Allowance.
------------------ In addition to the
compensation set forth above, Employee shall be paid a vehicle
allowance of Seven Hundred Fifty and No/100 ($750.00) Dollars per
month. This amount shall be paid on the first day of each month,
and the Company shall also reimburse Employee for all actual
expenses associated with operating Employee's vehicle for
Business Purposes. Employee shall submit receipts or other
evidence of such expenditures, and Company shall pay these
amounts to Employee within thirty (30) days of receipt of the
invoices.
5. Relocation Expenses.
-------------------- Company shall reimburse
Employee for all reasonable expenses incurred by Employee in
relocating his home to Houston, Texas, such expenses to include,
without limitation, all physical moving costs, real estate
brokerage fees (up to 6% of the sales price of Employee's
existing home) and all expenses incurred by Employee and his wife
in traveling to Houston, Texas in order to purchase a new home.
6. Stock Option Grants.
-------------------- In addition to the
compensation set forth above, Company shall issue to Employee an
option to purchase fifty thousand (50,000) shares of Company's
common stock, pursuant to the currently effective Employee Stock
Option Plan, as approved by the Toronto Stock Exchange.
Employee's vesting rights and other rights and privileges with
respect to this stock option shall be governed by the terms and
provisions of said stock option plan, a copy of which has been
delivered to Employee for his review. The stock option set forth
herein is not assignable by Employee.
7. Bonuses.
-------- (a) Employee shall be entitled to
receive a non-discretionary annual bonus (the "Minimum Annual
Bonus") in the amount of Seventy Thousand and No/100 ($70,000.00)
Dollars per year, payable on or before each anniversary date of
this Employment Agreement. There shall be no conditions
precedent to the payment by Company to Employee of the Minimum
Annual Bonus, other than the requirement that Employee be in the
employment of Company, as of said anniversary date, unless such
employment has been terminated in the manner provided in Section
B-6. of this Agreement.
(b) In addition to the Minimum Annual Bonus,
described above, Employee shall be entitled to participate in the
executive bonus pool, which is equal to five percent (5%) of the
Net Profit of Company, payable within ninety (90) days of closing
of the Company's fiscal year. The amount of Employee's
participation in the pool shall be determined in the sole
discretion of the Chief Executive Officer. The term "Net Profit"
shall mean the consolidated net income of Company, after tax, for
the fiscal year of the Company, determined in accordance with
generally accepted accounting principles, by the certified public
accounts retained by Company to perform its annual audit.
8. Vacation, Holiday, and Sick Leave.
---------------------------------- Employee shall
be entitled to _________ paid vacation days annually, effective
as of the Commencement Date of this Agreement.
9. Initial Bonus.
-------------- As partial consideration for
Employee's agreement to become employed by the Company pursuant
to the provisions of this Agreement, Company agrees to pay
Employee a signing bonus in the amount of Two Hundred Fifty
Thousand and No/100 ($250,000.00) Dollars, which shall be payable
to Employee in full on or before November _____, 1996.
D. Confidentiality; Non-Competition.
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1. Confidentiality Information; Personal
Relationships. -----------------------------------
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Employee agrees that he shall during and after termination of
employment with Company, keep secret and retain in strictest
confidence all confidential matters of the Company, its clients
and suppliers, and the "know-how", trade secrets, confidential
client lists, details of client, subcontractor or consultant
contracts, pricing policies, operational methods, marketing plans
or strategies, project development, acquisition or bidding
techniques or plans, business acquisition plans, new personnel
acquisition plans, technical processes, inventions and research
projects of Company learned by Employee and directly or
indirectly resulting from his employment by Company, unless (i)
such information is generally available to the public without
restriction, (ii) Employee obtains confidentiality agreements
with respect to such confidential information, (iii) such
information is provided to a customer or supplier of the Company
in the ordinary course of business, (iv) such disclosure is
approved by the Chief Executive Officer or (v) Employee is under
compulsion of either a court order or a governmental agency's or
authority's inquiry, order or request to so disclose such
information.
2. Property of Company.
--------------------
(a) Except as otherwise provided herein, all
lists, records and other non-personal documents or papers (and
all copies thereof), including such items stored in computer
memories, on microfiche or by any other means, made or compiled
by or on behalf of Employee, or made available to Employee
relating to Company are and shall be the property of Company, and
shall be delivered to Company on the date of termination of this
Agreement.
(b) All inventions, including any procedures,
formulas, methods, processes, uses, apparatuses, patterns,
designs, drawings, devises or configurations of any kind, any and
all improvements to them which are developed, discovered, made,
or produced, trade secrets, or information used by Company are
the exclusive property of Company, and shall be delivered to
Company, on the earlier of the expiration or the termination of
this Agreement.
(c) All Company names, logos, trade marks, copy
rights, slogans, insignias and the like are the exclusive
property of Company, and Employee shall not be entitled to use,
divert, imitate, duplicate or otherwise deal with said property
or property rights, without the prior written consent of Company;
provided,
--------
however, that Employee and Company agree that in the event the
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Company at any time during the term of this Employment Agreement
adopts or utilizes the name of Employee in its advertising or
promotional materials, that Employee shall have the right at any
time during or after the termination of this Employment Agreement
to require Company to cease using Employee's name or likeness in
connection with any such advertising or marketing materials
promoting the Company or its products.
3. Employees of Company.
-------------------- Upon termination of this
contract by either party for any reason, with or without cause,
Employee shall not, directly or indirectly, during the course of
his employment or for a period of twenty-four (24) months after
such termination, solicit any employee of Company, or encourage
any such employee to leave such employment without the prior
written approval of Company as applicable.
4. Restrictive Covenants.
---------------------- (a) E m p l o y e e
acknowledges and agrees that: (i) the business contacts,
customers, suppliers, technology, know-how, trade secrets,
marketing techniques and other aspects of the business of
Company, its affiliates and its successors and assigns are of
value to Company, and provide Company with substantial
competitive advantage in the operation of business, and (ii) by
virtue of his current relationship with Company, Employee has
knowledge and possesses confidential information concerning the
business procedures, existing and potential customer base and
operations of Company.
(b) In consideration of the receipt of the Base Salary
(as defined above), it is hereby agreed that (A) in the event
Company terminates this Agreement without Cause (as defined
herein), for the period riding on the date that Employee is
entitled to receive his last remaining employee severance
payment, described in Section B-6, above, or (B) in the event the
employment of Employee is terminated voluntarily by Employee
Without Cause or by Company for Cause, for the period ending
three (3) years following Employee's termination of employment
with Company, Employee shall not, directly or indirectly, for
himself, nor through or on behalf of any other person or entity:
(i) divulge, transmit or otherwise disclose or
cause to be divulged, transmitted or otherwise disclosed, any
business contacts, customer lists technology, know-how, trade
secrets, marketing techniques, contracts or other confidential or
proprietary information of Company or its successors or assigns
of whatever nature; and/or
(ii) except as set forth in sub-paragraph (c),
hereinbelow, in any way assist, loan money to, consult with,
invest, carry on, engage in or become involved with (whether as
an employee, agent, officer, director, stockholder, manager,
partner, joint venturer, lender, participant, consultant or
otherwise), any business enterprise (other than Company or its
subsidiaries or any affiliated corporation, successors or
assigns, if any) which: (a) is or shall be located or operating,
or soliciting or servicing customers located or operating, within
the geographical borders of the United States of America
(collectively, the "Territory"), and (b) is or shall become
engaged in any business in competition with the business of
Company or its successors or assigns. As used herein, the term
"business in competition with the business of Company or its
successors or assigns" environmental remediation and compliance
services, disposal services, demolition and dismantlement
services, industrial and/or commercial mechanical contracting
services, and any such other services or activities owned by or
being conducted by Company, its subsidiaries or affiliates, as of
the date of termination or expiration of this Agreement. The
provisions of this subparagraph 4(b)(ii) only shall not preclude
or prohibit ownership of not more than five percent (5%) of the
outstanding shares of a publicly held corporation if such
ownership does not involve managerial or operational
responsibility; this exception shall have no applicability to any
restrictions or covenants imposed anywhere in this Agreement
except specifically with respect to this subparagraph D-4(b)(ii).
E. Default.
-------- In the event that either party hereto shall
breach any of the terms of this Agreement, Company shall be
reimbursed by such defaulting party for all costs and expenses,
including reasonable attorneys' fees, incurred by the non-
defaulting party in enforcing the terms of this Agreement and/or
recovering damages as a result of any such breach.
F. Binding Effect.
--------------- This contract is a personal
services agreement between Company and Employee. Accordingly,
Employee is not authorized to voluntarily or involuntarily
transfer or assign any of his contractual rights contained
herein, and any such attempted voluntary or involuntary transfer
or assignment shall be null and void and shall cause an immediate
termination of this agreement. Except for this restriction on
assignability, all of the terms and conditions of this Agreement
shall be binding upon and inure to the benefit of Employee and
Company and any successor-in-interest to any of them.
G. Notices.
--------- Except as herein provided, any notice,
request, demand or other communication required or permitted
under this Agreement shall be in writing and shall be deemed to
have been given when delivered personally or when mailed by
certified mail, return receipt requested, addressed to the party
at the address of such party first set forth above, or at such
other address as such party may hereafter have designated by
notice.
If to Company at the address first above written with
copies to:
Xx. Xxxxxxx X. XxXxxxxx, President
American ECO Corporation
0000 Xxxxx Xxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
or to any other address as shall be designated from time to time
by Company
If to Employee at the address first above written or to
any other address as shall be designed from time to time by
Employee.
H. Indemnification.
---------------- The Company shall indemnify, hold
harmless and protect Employee, his heirs, executors,
administrators and legal representatives, from and against all or
any portion of any expenses, including reasonable attorney's
fees, incurred by Employee, actually and necessarily incurred by
him in connection with or arising out of any action, suit or
proceeding in which he may be involved by reason of his being or
having been an officer and representative of Company, whether or
not he continues to be an officer or representative of the
Company at the time such claim is prosecuted against Employee,
such expenses to include the cost of reasonable settlements and
the satisfaction of final, non-appealable judgments against
Employee, in connection with the matters covered hereby.
However, Company shall not indemnify Employee with respect to
matters as to which Employee shall be finally adjudged in any
such action, suit or proceeding to be guilty of negligence or
misconduct in the performance of his duties as an officer of
Company or in which Employee is found to be in material breach
this Agreement. The foregoing rights of indemnification shall
not be exclusive of any other rights to which Employee may be
entitled as a matter of law, by agreement, by approval of the
Board of Directors of Company, or otherwise.
I. Miscellaneous.
--------------
1. Neither this Agreement nor any of the terms or
conditions hereof may be waived, amended or modified except by
means of a written instrument duly executed by the party to be
charged herewith.
2. The captions and paragraph headings used in the
Agreement are for convenience of reference only, and shall not
affect the construction or interpretation of this Agreement or
any of the provisions hereof.
3. This Agreement, and all matters or disputes
relating to the validity, construction, performance or
enforcement hereof, shall be governed and construed under the
laws of the State of Texas, performable in Xxxxxx County, Texas.
4. Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original
hereof, but all of which together shall constitute one and the
same instrument.
5. ANY DISPUTE INVOLVING THE INTERPRETATION OR
APPLICATION OF THIS AGREEMENT SHALL BE RESOLVED BY FINAL AND
BINDING ARBITRATION BEFORE ONE OR MORE ARBITRATORS DESIGNATED BY
THE AMERICAN ARBITRATION ASSOCIATION IN HOUSTON, TEXAS UNLESS
MUTUALLY AGREED TO OTHERWISE. THE AWARD OF SUCH ARBITRATOR(S)
MAY BE ENFORCED IN ANY COURT OF COMPETENT JURISDICTION IN THE
STATE OF TEXAS.
6. This Agreement is intended for the sole and
exclusive benefit of the parties hereto and their respective
heirs, executors, administrators, personal representatives,
successors, and permitted assigns, and no other person or entity
shall have any right to rely on this Agreement or to claim or
derive any benefit herefrom absent the express written consent of
the party to be charged with such reliance or benefit.
7. Company has agreed to advance a loan to Employee
in the original principal amount of Three Hundred Fifty Thousand
and No/100 ($350,000.00) Dollars, said loan to be repaid by
Employee in accordance with the terms and provisions of a certain
promissory note evidencing said loan, and a copy of said
promissory note is attached hereto and incorporated herein by
reference. Notwithstanding any other provision contained in said
promissory note to the contrary, it is agreed that in the event
this agreement is terminated by Company for Cause, in addition to
the other rights and remedies that Company shall have in
accordance with the terms of this Agreement, Company shall have
the right to immediately declare due and payable, all loans and
advantages made by Company to Employee, at which time Employee
shall be required to repay in full said loans and advances
including the loan evidenced by the promissory note referred to
herein. The Company shall have the right to offset and credit
against the unpaid principal balance of such loans, all accrued
and unpaid salary, bonuses, and/or profit sharing distributions
accrued but unpaid to Employee as of the date of termination.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on and as of the date first set forth above.
COMPANY:
ATTEST: AMERICAN ECO CORPORATION
_________________________________
BY:_____________________________
ITS:____________________________
EMPLOYEE:
________________________________
XXXXX XXXXXXXX
