EMPLOYMENT AGREEMENT
Exhibit
10.01
THIS
AGREEMENT (the "Agreement") is made as of the 2nd day of September, 2008 between
Aduromed Industries, Inc., a Delaware corporation (“ADRM"), Aduromed
Corporation, a Delaware corporation (“Aduromed", and together with ADRM, the
“Companies”) and Xxxxx Xxxxxxxx (the "Executive" or "Employee"), an individual
residing at 0000 Xxxxxxxx Xxx Xxxx X, Xxxx Xxx, XX 00000-0000.
WITNESSETH
THAT:
WHEREAS,
the Executive has extensive and valuable experience in the business of the
Companies; and
WHEREAS,
the Companies desire to employ the Executive, giving him full executive powers,
and the Executive desires so to be employed by the Companies;
NOW,
THEREFORE, in consideration of the premises and mutual covenants herein
contained, the Companies and the Executive hereby agree as follows:
1.
Employment.
The
Companies shall, and do hereby, employ the Executive, and the Executive shall,
and does hereby accept employment from the Companies in the capacity of the
President and Chief Executive Officer of the Companies. In such capacity, the
Executive shall at all times during the term of his employment hereunder have
the title of President and Chief Executive Officer; and shall
(i)
devote during normal business hours his full attention, knowledge, experience,
skills and best endeavors to the business and affairs of the
Companies,
(ii)
perform services and discharge duties set forth herein and generally associated
with the position of the Chief Executive Officer in a trustworthy manner
and
(iii)
perform all duties consistent with (a) policies established from time to time
by
the Companies and (b) all applicable legal requirements.
2.
Authority.
Executive
shall have full power, responsibility and authority to manage the businesses
in
the ordinary course of both the Companies and its various subsidiaries, if
any
as provided by the Board of Directors, including but not limited
to,
(i)
hiring, terminating and setting the compensation (including fringe benefits)
for
employees of, consultants and agents for the Companies,
provided, however, that in no case shall an employment contract set a term
of
greater than one (1) year nor provide for salary and bonus in excess of $200,000
per year without first receiving the approval of the Board of Directors of
the
Companies; and
(ii)
performing all other functions necessary to provide for the continued operation
in the ordinary course of the Companies as shall from time to time be
established.
3.
Term.
Subject
to the provisions for termination herein provided, the term of this Agreement
shall commence as of the 2nd day of September, 2008, and shall continue in
full
force and effect until the Company's close of business on September 2nd, 2011.
At the expiration of the original term of this Agreement on September 2nd,
2011,
and upon each anniversary thereafter, the Term of this Agreement shall be deemed
renewed and extended for successive one-year periods, provided that neither
party, within ninety (90) days prior to such expiration date or any anniversary
thereof, shall have given written notice to the other that this Agreement shall
not be renewed or extended. (Such term, including all renewals and extensions,
herein called the "Term".)
4.
Compensation.
The
Company shall compensate the Employee during the Term of this Agreement as
follows:
(a)
Base
Salary. The Employee shall be paid a base salary ("Base Salary") of not less
than Three Hundred Thousand Dollars ($300,000.00) per year in installments
consistent with the Companies’ usual practices.
(b)
Performance Bonus. The Employee shall be entitled to an annual cash bonus (
the
"Bonus") based upon the Companies’ attainment of reasonable financial objectives
to be determined annually by the Board. The maximum annual Bonus shall not
exceed sixty percent (60%) of the applicable year's ending Base Salary and
shall
be payable only in the event the Board determines, in its sole and exclusive
discretion, that the particular year's financial and set objectives have been
met. The timing for payment of any such Bonus shall be in accordance with the
Companies’ bonus plan, if any shall have been established by the Board, but in
any event not later than seventy-five (75) days following the close of the
particular fiscal year.
(c)
Withholding. All compensation payable to the Executive hereunder shall be
subject to withholding, as required by law.
5.
Benefits.
(a)
Generally. The Executive shall be eligible to participate in any employee
benefit or welfare plan, including any life, accident, medical, and disability
insurance, retirement or pension plan or program maintained or which shall
be
maintained from time to time during the Term by the Companies for its employees
or executive employees and their immediate families, on the same basis and
subject to the same requirements and limitations as are or shall be applicable
to other employees or executive employees of the Companies.
(b)
Perquisites. The Executive shall be provided with (i) a car allowance of $800
per month (ii) a cellular phone and the Companies shall pay all monthly fees
and
charges, (iii) computer equipment, dedicated phone/fax line and fax/copying
and
scanning equipment at Employee's residence and the Companies shall pay or
reimburse him for all installation and carrying charges associated therewith,
and (iv) such other perquisites as are normal and customary for executives
similarly situated which contribute to the Executive’s performance of his
responsibilities and (v) other perquisites that from time to time may be
established by the Companies and its Board of Directors.
6.
Vacation.
Executive
shall be entitled to four (4) weeks' vacation each year during the Term of
this
Agreement, and any renewal or extension thereof, to be taken at times not
inconvenient to the Companies.
7.
Expenses.
The
Companies shall reimburse the Executive for all reasonable business expenditures
made by him in connection with, or in furtherance of, his employment hereunder,
upon presentation and approval of itemized expense statements, receipts or
vouchers or such other supporting information as may from time to time be
reasonably requested by the Companies. Air travel by Executive shall be in
"business class” and shall include the providing of a designated airline travel
club where the executive can make use of such facilities to conduct business
in
a professional environment while traveling.
8.
Confidentiality.
During
the Term of his employment, and at all times thereafter, the Employee shall
not,
without the prior written consent of the Companies, divulge to any third party
or use for his own benefit or the benefit of any third party or for any purpose
other than the exclusive benefit of the Companies, any confidential or
proprietary business or technical information revealed, obtained or developed
in
the course of his employment with the Companies and which is otherwise the
property of the Companies or any of its affiliated corporations, including,
but
not limited to, trade secrets, customer lists, formulae and processes of
manufacture; provided, however, that nothing herein contained shall restrict
the
Employee's ability to make such disclosures during the course of his employment
as may be necessary or appropriate to the effective and efficient discharge
of
his duties to the Companies.
9.
Proprietary Intellectual Property.
The
Employee shall treat as for the sole benefit of the Companies and fully and
promptly disclose and assign to it without additional compensation, all
proprietary intellectual property, including, without limitation, all ideas,
discoveries, inventions and improvements, patentable or not, as well as all
formulae, processes, know-how, patent rights and letters patent therefor filed
in the United States and all other countries, and any and all rights and
interests in, to and under the same, made, conceived, acquired, reduced to
practice, or otherwise possessed, during the term of his employment by the
Companies, alone or with other employees, during or after usual working hours
either on or off the job, and which are related to the Companies’ business. In
addition, the Employee agrees that, upon request, he will promptly make all
disclosures, execute all instruments and papers, and perform all acts whatsoever
necessary or desired by the Companies to vest in and assign to the Companies,
their successors, assigns and nominees, fully and completely, all rights created
or contemplated by this SECTION 9 and which may be necessary or desirable to
enable the Companies, their successors, assigns and nominees to secure and
enjoy
the full benefits and advantages thereof, including any and all applications,
writings or other documents, as may be necessary to apply for and obtain any
patent, copyright or trademark registration by the Companies or any assignment
thereof. Employee shall at all times cooperate with and assist the Companies
in
preserving and enforcing the aforesaid rights which assistance and cooperation
shall include but not be limited to providing the Companies with all information
and documents necessary to prosecute and defend such rights. The covenants
made
by the Employee under the terms of this SECTION 9 shall be enforceable by the
Companies for so long as employee shall be employed by, or a consultant to,
the
Companies and for twelve (12) months immediately thereafter unless, during
the
term of this Agreement, he shall have been terminated without
cause.
10.
Property.
Both
during the Term of his employment and thereafter, the Employee shall not remove
from the Companies’ offices or premises any of the Companies’ documents,
records, notebooks, files, correspondence, reports, memoranda and similar
materials or property of any kind unless necessary in accordance with the duties
and responsibilities of his employment. In the event that any such material
or
property is removed, it shall be returned as promptly as possible. The Employee
shall not make, retain, remove or distribute any copies, or divulge to any
third
person the nature or contents of any of the foregoing or of any other oral
or
written information to which he may have access, except as disclosure shall
be
necessary in the performance of his duties. On the termination of his employment
with the Companies, the Employee shall leave with or return to the Companies
all
originals and copies of the foregoing then in his possession or subject to
his
control, whether prepared by the Employee or by others.
11.
Termination By Companies.
(a)
Termination for Cause. The employment of the Employee may be terminated for
Cause at any time by the vote of a majority of the Board; provided, however,
that before the Companies may terminate the Employee's employment for Cause
for
any reason that is susceptible to cure, the Companies shall first send the
Employee written notice of its intention to terminate this Agreement for Cause,
specifying in such notice the reasons for such Cause and those conditions that,
if satisfied by the Employee, would cure the reasons for such Cause, and the
Employee shall have 30 days from receipt of such written notice to satisfy
such
conditions. If such conditions are satisfied within such 30-day period, the
Companies shall so advise the Employee in writing. If such conditions are not
satisfied within such 30-day period, the Companies may thereafter terminate
this
Agreement for Cause on written Notice of Termination (as defined in SECTION
13(a)) delivered to the Employee describing with specificity the grounds for
termination. Immediately on termination pursuant to this SECTION 11(A), the
Companies shall pay to the Employee in a lump sum any remaining unpaid Base
Salary under SECTION 4(A) to the Date of Termination (as defined in SECTION
13(B)) and the Employee shall forfeit any Base Salary attributable to any period
subsequent to the Date of Termination. On termination pursuant to this SECTION
11(A), the Employee shall forfeit (i) his Bonus under SECTION 4(B) for the
year
in which such termination occurs, and (ii) all unvested Options and other
options, warrants and rights relating to capital stock of the Companies, except
those issued prior to the date of this Agreement. For purposes of this
Agreement, Cause shall mean: (1) a material breach of any of the terms of this
Agreement that is not immediately corrected following written notice of default
specifying such breach; (2) repeated intoxication with alcohol or drugs while
on
Companies’ premises during its regular business hours to such a degree that, in
the reasonable judgment of the other managers of the Companies, the Employee
is
abusive or incapable of performing his duties and responsibilities under this
Agreement; (3) conviction of a felony; or (4) misappropriation of property
belonging to the Companies and/or any of its affiliates.
(b)
Termination Without Cause. The employment of the Employee may be terminated
without Cause at any time by the vote of a majority of the Board on delivery
to
the Employee of a written Notice of Termination (as defined in SECTION 13(A)).
On the Date of Termination (as defined in SECTION 13(B)) pursuant to this
SECTION 11(B), the Company shall pay to the Employee in a lump sum in lieu
of
payments under SECTIONS 4(A), 4(B) AND 5 for the remainder of the Term an amount
equal to the sum of (i) all remaining unpaid Base Salary payable under SECTION
4(A) for the full period through the Date of Termination, plus (ii) the maximum
Bonus available to the Employee under SECTION 4(B) for the year in which the
termination occurs, pro-rated through the Date of Termination, plus (iii) Base
Salary payable under SECTION 4(A) for a full one (1) year period commencing
on
the Date of Termination, such Base Salary to be paid to the Employee in
accordance with the Companies’ normal payroll practices over the course of such
additional one year period, plus (iv) the maximum Bonus available to the
Employee under SECTION 4(B) for the one (1) year period commencing on the Date
of Termination, such Bonus to be paid to the Employee in accordance with the
Companies’ normal payroll practices over the course of such additional one year
period. In addition, on termination of the Employee under this SECTION 11(B),
all of the Employee's unvested Options and other options, warrants and rights
relating to capital stock of the Companies shall immediately vest and become
exercisable. The term of any such options (including the Options), warrants
and
rights shall be extended to the fifth anniversary of the Employee's termination.
The Employee acknowledges that extending the term of any incentive stock option
pursuant to this SECTION 11(B), or SECTION 11(C), 11(D) OR 12(A), could cause
such option to lose its tax-qualified status under the Internal Revenue Code
of
1986, as amended (the "Code"), and agrees that the Companies shall have no
obligation to compensate the Employee for any additional taxes he incurs as
a
result. In addition, Employee shall be entitled to any benefits under Section
5
hereof which he had the benefit of as of the Date of Termination for such
additional one year period upon the same terms and conditions as they existed
as
of the Date of Termination.
(c)
Termination on Disability. If during the Term the Employee should fail to
perform his duties hereunder on account of physical or mental illness or other
incapacity which the Board shall in good faith determine renders the Employee
incapable of performing his duties hereunder, and such illness or other
incapacity shall continue for a period of more than six (6) consecutive months
("Disability"), the Companies shall have the right, on written Notice of
Termination (as defined in SECTION 13(A)) delivered to the Employee to terminate
the Employee's employment under this Agreement. During the period that the
Employee shall have been incapacitated due to Disability, the Employee shall
continue to receive the full Base Salary provided for in SECTION 4(A) hereof
at
the rate then in effect until the Date of Termination (as defined in SECTION
13(B)) pursuant to this SECTION 11(C). On the Date of Termination pursuant
to
this SECTION 11(C), the Companies shall pay to the Employee in a lump sum an
amount equal to all remaining unpaid Base Salary payable under SECTION 4(A)
for
the full period through the Date of Termination. In addition, the Companies
shall pay to the Employee Base Salary payable under SECTION 4(A) for a full
one
(1) year period commencing on the Date of Termination, such Base Salary to
be
paid to the Employee in accordance with the Companies’ normal payroll practices
over the course of such additional one year period. In addition, on such
termination, all of the Employee's unvested Options and other options, warrants
and rights relating to capital stock of the Companies shall immediately vest
and
become exercisable. The term of any such options (including the Options),
warrants and rights shall be extended to the fifth anniversary of the Employee's
termination. In addition, Employee shall be entitled to any benefits under
Section 5 hereof which he had the benefit of as of the Date of Termination
for
such additional one year period upon the same terms and conditions as they
existed as of the Date of Termination.
(d)
Termination on Death. If the Employee shall die during the Term, the employment
of the Employee shall thereupon terminate. On the Date of Termination (as
defined in SECTION 13(B)) pursuant to this SECTION 11(D), the Companies shall
pay to the Employee's estate a lump sum amount equal to all remaining unpaid
Base Salary payable under SECTION 4(A) for the full period through the Date
of
Termination. In addition, the Companies shall pay to the Employee’s estate Base
Salary payable under SECTION 4(A) for a full one (1) year period commencing
on
the Date of Termination, such Base Salary to be paid to the Employee’s estate in
accordance with the Companies’ normal payroll practices over the course of such
additional one year period. In addition, on termination of the Employee under
this SECTION 11(D), all of the Employee's unvested Options and other options,
warrants and rights relating to capital stock of the Companies shall immediately
vest and become exercisable. The term of any such options (including the
Options), warrants and rights shall be extended to the fifth anniversary of
the
Employee's termination. The provisions of this SECTION 11(D) shall not affect
the entitlements of the Employee's heirs, executors, administrators, legatees,
beneficiaries or assigns under any employee benefit plan, fund or program of
the
Companies.
12.
[This
Section Intentionally Left Blank].
13.
Provisions Applicable to Termination of Employment.
(a)
Notice of Termination. Any purported termination of Employee's employment by
the
Companies pursuant to SECTION 11 shall be communicated by Notice of Termination
to the Employee as provided herein, and shall state the specific termination
provisions in this Agreement relied on and set forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of the
Employee's employment ("Notice of Termination”).
(b)
Date
of Termination. For all purposes, "Date of Termination" shall mean, for
Disability, thirty (30) days after Notice of Termination is given to the
Employee (provided the Employee has not returned to duty on a full-time basis
during such 30-day period), or, if the Employee's employment is terminated
by
the Companies for any other reason, the date on which a Notice of Termination
is
given.
(c)
Benefits on Termination. On termination of this Agreement by the Companies
pursuant to SECTION 11, all profit-sharing, deferred compensation and other
retirement benefits payable to the Employee under benefit plans in which the
Employee then participated shall be paid to the Employee in accordance with
the
provisions of the respective plans and the Employee shall be entitled to all
accrued and unused vacation days through the Date of Termination.
14.
Non-Competition and Non-Solicitation.
(a)
In
consideration of the provisions hereof and the payments provided under SECTION
11, for the Restricted Period (as hereinafter defined), the Employee will not,
except as specifically provided below, anywhere in any state of the United
States in which the Companies are engaged in the conduct of their business
as of
such termination date (the "Restricted Territory"), directly or indirectly,
acting individually or as the owner, shareholder, partner or management employee
of any entity, (i) engage in the operation of disposing or converting medical
waste, (ii) enter the employ as a manager of, or render any personal services
to
or for the benefit of, or assist in or facilitate the solicitation of customers
for, or receive remuneration in the form of management salary, commissions
or
otherwise from, any business engaged in such activities in such jurisdictions;
or (iii) receive or purchase a financial interest in, make a loan to, or make
a
gift in support of, any such business in any capacity, including without
limitation, as a sole proprietor, partner, shareholder, officer, director,
principal agent or trustee; provided, however, that the Employee may own,
directly or indirectly, solely as an investment, securities of any business
traded on any national securities exchange or quoted on any NASDAQ market,
provided the Employee is not a controlling person of, or a member of a group
which controls, such business and further provided that the Employee does not,
in the aggregate, directly or indirectly, own five percent (5%) or more of
any
class of securities of such business. The term "Restricted Period" shall mean
the earlier of (i) the maximum period allowed under applicable law and (ii)(x)
in the case of a Change of Control, until the third anniversary of the effective
date of the Change of Control, (y) in the case of a termination by the Companies
without Cause pursuant to Section 10(b) and provided the Companies have made
the
payments required under SECTION 11(B), until the second anniversary of the
Date
of Termination, or (z) in the case of Termination for Cause by the Company
pursuant to SECTION 11(A), until the first anniversary of the Date of
Termination.
(b)
If
the final judgment of a court of competent jurisdiction declares that any term
or provision of this SECTION 15 is invalid or unenforceable, the parties agree
that the court making the determination of invalidity or unenforceability shall
have the power to reduce the scope, duration or area of the term or provision,
to delete specified words or phrases or to replace any invalid or unenforceable
term or provision with a term or provision that is valid and enforceable and
that comes closest to expressing the intention of the invalid or unenforceable
term or provision, and this Agreement shall be enforceable as so modified after
the expiration of the time within which the judgment may be
appealed.
15.
(a)
Benefits Upon a Change in Control. If (i) during the term of this Agreement
and
while Executive remains an employee of the Companies, the Companies shall be
subject to a Change in Control and (ii) within one (1) year following such
Change in Control the Companies terminate the employment of Executive
involuntarily and without Cause, then in such case Executive shall be entitled
to receive the following: (A) Executive's unpaid Base Salary accrued through
the
Date of Termination, plus (B) the maximum Bonus available to the Employee under
SECTION 4(B) for the year in which the termination occurs, pro-rated through
the
Date of Termination, plus (C) Base Salary payable under SECTION 4(A) for a
full
one (1) year period commencing on the Date of Termination, such Base Salary
to
be paid to the Employee in accordance with the Companies’ normal payroll
practices over the course of such additional one year period, plus (D) the
maximum Bonus available to the Employee under SECTION 4(B) for the one (1)
year
period commencing on the Date of Termination, such Bonus to be paid to the
Employee in accordance with the Companies’ normal payroll practices over the
course of such additional one year period, and (E) to the extent required by
COBRA only, continuation of group health benefits pursuant to the Companies’
standard programs or in effect at the Date of Termination, for a period of
not
less than 18 months (or such longer period as may be required by COBRA),
provided that Executive makes the necessary conversion. If during the term
of
this Agreement and while Executive remains an employee of the Companies, the
Companies shall be subject to a Change in Control, then in such case Executive
shall be entitled to vesting of all of the Executive's unvested Options and
other options, warrants and rights relating to capital stock of the Companies
which shall immediately become exercisable and the term of any such options
(including the Options), warrants and rights shall be extended to the fifth
anniversary of the date of such Change in Control.
(b)
Exclusivity. The provisions of this Agreement are intended to be and are
exclusive and in lieu of any other rights or remedies to which Executive or
the
Companies may otherwise be entitled, either at law, tort or contract, in equity,
under Companies policies in effect now or hereafter, or under this Agreement,
in
the event that (i) during the term of this Agreement and while Executive remains
an employee of the Companies, the Companies shall be subject to a Change in
Control and (ii) within one (1) year following such Change in Control the
Companies terminates the employment of Executive involuntarily and without
Cause. In such circumstances, Executive shall be entitled to no benefits,
compensation or other payments or rights upon termination of employment other
than those benefits expressly set forth in Section 15.
"Change
in Control" shall mean any merger, consolidation, sale of assets or other
similar transaction or series of transactions involving the Companies, other
than any such transaction or transactions following which the Companies or
its
stockholders continue to own a majority of the combined voting power of the
outstanding securities of the corporation or other entity surviving or
succeeding to the business of the Companies.
16.
Indemnification.
As
an
employee and agent of the Companies, the Employee shall be fully indemnified
by
the Companies to the fullest extent permitted by applicable law in connection
with his employment hereunder.
17.
Survival of Provisions.
The
obligations of the Companies under SECTION 15 of this Agreement shall survive
both the termination of the Employee's employment and this
Agreement.
18.
No
Duty to Mitigate; No Offset.
The
Employee shall not be required to mitigate damages or the amount of any payment
contemplated by this Agreement, nor shall any such payment be reduced by any
earnings that the Employee may receive from any other sources or offset against
any other payments made to him or required to be made to him pursuant to this
Agreement.
19.
Assignment; Binding Agreement.
The
Companies may assign this Agreement to any parent, subsidiary, affiliate or
successor of the Companies. This Agreement is not assignable by the Employee
and
is binding on him and his executors and other legal representatives. This
Agreement shall bind the Companies and their successors and assigns and inure
to
the benefit of the Employee and his heirs, executors, administrators, personal
representatives, legatees or devisees. The Companies shall assign this Agreement
to any entity that acquires its assets or business, and shall cause it to assume
the Companies’ obligations and liabilities arising hereunder.
20.
Notice.
Any
written notice under this Agreement shall be personally delivered to the other
party or sent by certified or registered mail, return receipt requested and
postage prepaid, to such party at the address set forth in the records of the
Companies or to such other address as either party may from time to time specify
by written notice.
21.
Entire Agreement; Amendments.
This
Agreement contains the entire agreement of the parties relating to the
Employee's employment and supersedes all oral or written prior discussions,
agreements and understandings of every nature between them. This Agreement
may
not be changed except by an agreement in writing signed by the Companies and
the
Employee.
22.
Waiver.
The
waiver of a breach of any provision of this Agreement shall not operate or
as be
construed to be a waiver of any other provision or subsequent breach of this
Agreement.
23.
Governing Law and Jurisdictional Agreement.
This
Agreement shall be governed by and construed and enforced in accordance with
the
laws of the State of New York. The parties irrevocably and unconditionally
submit to the jurisdiction and venue of any court, federal or state, situated
within New York County, New York for the purpose of any suit, action or other
proceeding arising out of, or relating to or in connection with, this
Agreement.
24.
Severability.
In
case
any one or more of the provisions contained in this Agreement is, for any
reason, held invalid in any respect, such invalidity shall not affect the
validity of any other provision of this Agreement, and such provision shall
be
deemed modified to the extent necessary to make it enforceable.
25.
Enforcement.
It
is
agreed that it is impossible to measure fully, in money, the damage which will
accrue to the Company in the event of a breach or threatened breach of SECTIONS
8, 9 OR 10 of this Agreement, and, in any action or proceeding to enforce the
provisions of SECTIONS 8, 9 OR 10 hereof, the Employee waives the claim or
defense that the Companies have an adequate remedy at law and will not assert
the claim or defense that such a remedy at law exists. The Companies are
entitled to injunctive relief to enforce the provisions of such sections as
well
as any and all other remedies available to it at law or in equity without the
posting of any bond.
26.
Counterparts.
This
Agreement may be executed in counterparts, each of which shall be deemed an
original and both of which together shall constitute one and the same
instrument.
27.
Due
Authorization.
The
execution of this Agreement has been duly authorized by the Companies by all
necessary corporate action.
IN
WITNESS WHEREOF, the parties have executed and delivered this Employment
Agreement as of the day and year set forth above.
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ADUROMED
INDUSTRIES, INC. a Delaware corporation
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By
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/s/ Xxxxx Xxxxxx
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Name:
Xxxxx Xxxxxx
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Title:
Chief Financial Officer and Treasurer
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ADUROMED
CORPORATION a Delaware corporation
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By
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/s/ Xxxxx Xxxxxx
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Name:
Xxxxx Xxxxxx
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Title:
Chief Financial Officer and Treasurer
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EMPLOYEE
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/s/
Xxxxx Xxxxxxxx
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Name:
Xxxxx Xxxxxxxx
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