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EXHIBIT 10.24
EMPLOYMENT AND NON-COMPETE AGREEMENT
This Agreement is made as of September 1, 1999, between ZMAX
CORPORATION, a Delaware corporation (the "Company"), and Xxxxx X. XxXxxxxx
("Employee"). The Company and Employee agree as follows:
1. Employment. The Company agrees to employ Employee in the
respective positions set forth herein and Employee accepts such employment by
the Company upon the terms and conditions set forth in this Agreement, for the
period beginning on the date of this Agreement and ending upon termination
pursuant to paragraph 4 (the "Employment Period"). This Agreement supercedes and
replaces all other employment agreements which may presently exist between the
Company and Employee.
2. Compensation and Benefits. In consideration for the valuable
services to be rendered by Employee and for Employee's agreement not to compete
against the Company or its subsidiaries as described in paragraph 5, the Company
hereby agrees that during the period of September 1, 1999 through September 1,
2003, the Company will pay Employee a bi-monthly gross salary at the annual rate
of at least $140,000 per annum (the "Base Salary"). Employee's Base Salary may
be adjusted upward annually each year beginning in January 2000 based on an
annual performance salary review as determined in the reasonable discretion of
the Company. Employee also shall be entitled to (1) an automobile expense
reimbursed to Employee for personal automobile use incurred in Company business;
(2) reimbursement for actual business expenses which have been incurred for the
benefit of the Company; (3) comparable combined paid vacation/sick leave and
medical and other benefits consistent with the Company's existing policies with
respect to key executives of the Company, as such policies may be amended from
time to time in the future; and (4) bonus compensation in the amount of up to
100% of his annual gross salary payable to him annually as provided in Exhibit
"A" hereto. Employee shall also be entitled to receive the stock options from
the Company as provided in Exhibit "B" hereto.
3. Services. During the Employment Period, Employee agrees to
devote Employee's best efforts and substantially all of Employee's business time
and attention to the business affairs of the Company, as its Vice President and
Chief Financial Officer with duties similar to Employee's duties prior to the
date of this Agreement, as well as such other duties consistent with such
position as determined by the Board of Directors of the Company (except for
reasonable vacation periods subject to the reasonable approval of the Company or
reasonable periods of illness or other incapacity). During the Employment
Period, Employee agrees to render such services as the Company may from time to
time direct. During the Employment Period, Employee agrees that Employee will
not, except with the prior written consent of the Company, become engaged in or
render services for any business other than the business of the Company. The
Company agrees that during the Employment Period, Employee shall not be required
to relocate from his current residence.
4. Termination. The Employment Period will continue from the date
of this Agreement unless terminated earlier by (a) Employee's death or permanent
disability which renders
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the Employee unable to perform Employee's duties hereunder (as determined by the
Company in its good faith judgment), (b) by Employee's resignation upon prior
written notice to the Company of sixty (60) days or (c) the Company for Cause.
For purpose of this paragraph 4, "Cause" shall mean (i) the repeated failure or
refusal of Employee to follow the lawful directives of the Company or its
designee (except due to sickness, injury or disabilities), (ii) gross
inattention to duty or any other willful, reckless or grossly negligent act (or
omission to act) by Employee, which, in the good faith judgment of the Company,
materially injures the Company, including the repeated failure to follow the
policies and procedures of the Company, (iii) a material breach of this
Agreement by Employee which is not cured by Employee after notice from the
Company, or (iv) the commission by Employee of a felony or the commission by
Employee of an act of financial dishonesty against the Company.
5. Non-Compete.
(a) In the event the Employment Period is terminated under
paragraphs 4(b) or 4(c) above, then the non-compete provisions of this paragraph
5 will apply to Employee. In the event the Employment Period is otherwise
terminated, such as without Cause, then no part of this paragraph 5 will apply
to Employee.
(b) Employee recognizes and acknowledges that by virtue of
accepting continued employment hereunder, Employee will continue to acquire
valuable training and knowledge, enhance Employee's professional skills and
experience, and continue to learn proprietary trade secrets and Confidential
Information of the Company. In consideration of the foregoing, this employment
contract and the payment by the Company to Employee of an amount in cash equal
to the Base Salary and cash bonus received by Employee from the Company for the
one-year period immediately preceding the date of termination of the Employment
Period, with such cash amount to be paid to Employee in twelve (12) equal
monthly installment payments as of the first day of each month during the
twelve-month period immediately following the date of termination of the
Employment Period, Employee agrees that during the Employment Period and for
twelve (12) months thereafter (the "Non-Compete Period") Employee will not
(whether as employee, director, owner, stockholder, consultant, partner (limited
or general) or otherwise) own, manage, control, participate in, consult with,
advertise on behalf of, render services for or in any manner engage in any
competitive business of soliciting or providing any computer consulting services
to any primary and exclusive business with existing clients of the Company
and/or its subsidiaries; nor shall Employee solicit any other Person to engage
in any of the foregoing activities or knowingly request, induce or attempt to
influence any then existing clients of the Company or any of its subsidiaries to
curtail any business they are currently, or in the last twelve (12) months have
been, transacting with the Company (the "Non-Compete). Nothing herein will
prevent Employee from being a passive owner of not more than five percent (5%)
of the outstanding stock of any class of a corporation which is engaged in a
competitive business of the Company and which is publicly traded, so long as
Employee has no participation in the business of such corporation. Furthermore,
during the Non-Compete Period, Employee shall not, without the Company's prior
written consent, knowingly solicit or encourage or attempt to influence any
existing employee or recruit to leave or discourage their employment with the
Company or any of its subsidiaries. Employee agrees that the restraint imposed
under this paragraph 5 is reasonable and not unduly
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harsh or oppressive.
(c) If, at the time of enforcement of any provision of
paragraph 5(b) above, a court or arbitrator holds that the restrictions stated
therein are unreasonable or unenforceable under circumstances then existing, the
Company and Employee agree that the maximum period, scope, or geographical area
reasonable or permissible under such circumstances will be substituted for the
stated period, scope or area.
(d) Since a material purpose of this Agreement is to protect
the Company's investment in the Employee and to secure the benefits of
Employee's background and general experience in the industry, the parties hereto
agree and acknowledge that money damages may not be an adequate remedy for any
breach of the provisions of this paragraph 5. Therefore, in the event of a
breach by Employee of any of the provisions of this paragraph 5, the Company or
its successors or assigns may, in addition to other rights and remedies existing
in its favor, apply to any court of law or equity of competent jurisdiction for
specific performance and/or injunctive or other relief in order to enforce or
prevent any violations of the provisions of this Agreement.
6. Confidential Information. Employee acknowledges that the
information, data and trade secrets (collectively, "Confidential Information")
obtained by Employee during the course of Employee's performance under this
Agreement, and previously if Employee has already been an employee of the
Company, concerning the business or affairs of the Company are the property of
the Company. For purposes of this Agreement, "trade secret" means any method,
program or compilation of information which is used in the Company's business,
including but not limited to: (a) techniques, plans and materials used by the
Company or any of its subsidiaries, (b) marketing methods and strategies
employed by the Company or any of its subsidiaries, and (c) all lists of past,
present clients of the Company or any of its subsidiaries. Employee agrees that
Employee will not disclose to any unauthorized Person or use for Employee's own
account any of such Confidential Information without the written consent of the
Company, unless and to the extent that the aforementioned matters become
generally known to and available for use by the public other than as a result of
Employee's acts or omissions to act or become known to Employee lawfully outside
the scope of Employee's employment under this Agreement. Employee agrees to
deliver to the Company at the termination of Employee's employment, or at any
other time the Company may request, all memoranda, notes, plans, records,
reports and other documents (and copies thereof) relating to the business of the
Company which Employee may then possess or have under Employee's control.
7. Notices. Any notice provided for in this Agreement shall be in
writing and shall be either personally delivered, sent by overnight courier
(e.g., Federal Express) or mailed by first class certified mail, return receipt
requested, to the recipient at the address below indicated:
To the Company: Xx. Xxxxxx X. XxXxxxxx
Chairman of the Board
ZMAX Corporation
00000 Xxxxxxx Xxxxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
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To Employee: Xxxxx X. XxXxxxxx
0000 Xxxxxxx Xxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
or such other address or to the attention of such other Person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement will be deemed to have been given when so delivered,
sent or mailed.
8. Miscellaneous. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law. The parties agree that (i) the provisions of this Agreement
shall be severable in the event that any of the provisions hereof are for any
reason whatsoever invalid, void or otherwise unenforceable, (ii) such invalid,
void or otherwise unenforceable provisions shall be automatically replaced by
other provisions which are as similar as possible in terms to such invalid, void
or otherwise unenforceable provisions but are valid and enforceable and (iii)
the remaining provisions shall remain enforceable to the fullest extent
permitted by law. This Agreement embodies the complete agreement and
understanding among the parties and supersedes and preempts any prior
understandings, agreements or representations by or among the parties, written
or oral, which may have related to the subject matter hereof in any way. This
Agreement may be executed on separate counterparts, each of which is deemed to
be an original and all of which taken together constitute one and the same
agreement. This Agreement is intended to bind and inure to the benefit of and be
enforceable by Employee, the Company and their respective successors and
assigns. Employee may not assign Employee's rights or delegate Employee's
obligations hereunder without the prior written consent of the Company. The
Company may assign its respective rights and delegate its duties hereunder
without the consent of Employee to Permitted Transferees. All questions
concerning the construction, validity and interpretation of the Agreement will
be governed by the internal law, and not the law of conflicts, of the State of
Maryland. All parties hereby consent to subject matter jurisdiction, personal
jurisdiction and venue in the appropriate state court located in Xxxxxxxxxx
County, Maryland for disputes under this Agreement. Any provision of this
Agreement may be amended or waived only with the prior written consent of both
the Company and Employee.
9. Definitions. "PERSON" shall mean and include an individual, a
partnership, a joint venture, a corporation, a trust, an unincorporated
organization and a governmental entity or any department or agency thereof.
"PERMITTED TRANSFEREE" shall mean a subsidiary of ZMAX Corporation or an
affiliate of ZMAX Corporation or any Person acquiring voting control of stock of
ZMAX Corporation.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the day
and year first above written.
WITNESS: EMPLOYEE:
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Xxxxxxx X. Xxxxxxx Xxxxx X. XxXxxxxx
Attest (Seal): ZMAX CORPORATION
By:
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Xxxxxxx X. Xxxxxxx Xxxxxx X. XxXxxxxx
President Chairman
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