Exhibit 10.8
EMPLOYMENT AGREEMENT
By and Between
XXXXX TECHNOLOGIES, INC.
And
XXXXX X. XXXX
January 31, 2005
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EMPLOYMENT AGREEMENT
This Employment Agreement (this "Agreement") is made and entered into
as of the 31st day of January 2005 (the "Effective Date") by and between Xxxxx
Technologies, Inc. (the "Company") and Xxxxx X. Xxxx ("Employee"). For purposes
of this Agreement, the Company and Employee are sometimes collectively referred
to as the "Parties."
Recitals
This Agreement is entered into with reference to the following facts
and mutual objectives:
A. Employee is a Certified Public Accountant and, at various times
prior to Effective Date, was employed by AMP Resources, LLC ("AMP") as a senior
officer and member, and by Headwaters, Inc. ("Headwaters") as it Chief Executive
Officer and President. Also, prior and continuing to the Effective Date,
Employee has served, and continues to serve, as a member of the Company's Board
of Directors.
B. Employee's services are deemed to be of value to the Company, and
the Company recognizes that inducements must be offered to Employee in order for
the Company to retain the Employee's services.
Terms and Conditions of Agreement
NOW THEREFORE, in consideration of the foregoing, and the covenants,
conditions, and promises set forth in this Agreement, the Parties agree as
follows:
1. Employment and Position
The Company employs Employee, and Employee accepts employment by the
Company as, Chief Executive Officer of the Company for the period of employment
specified in Section 3 hereinbelow ("Period of Employment").
2. Services To Be Rendered
The Employee shall, during the Period of Employment, serve the Company
in the position set forth in Section 1 hereinabove diligently and competently.
During the Period of Employment, Employee shall be free to conduct personal
business and investment activities and consult to AMP, Headwaters, or other
related entities, provided that such activities and consultation assignments do
not conflict or interfere with the performance of Employee's duties under this
Agreement. In discharging his duties under this Agreement, Employee shall act in
the best interests of the Company. In fulfilling his duties and responsibilities
under this Agreement, Employee shall report to the Board of Directors of the
Company.
3. Period of Employment
Employee's employment by the Company pursuant to this Agreement shall
commence on the Effective Date and continue, unless terminated sooner pursuant
to the provisions of this Agreement, for a period of three (3) years from the
Effective Date ("Period of Employment").
4. Base Salary
At the commencement of the Period of Employment, Employee shall be paid
an annual base salary of an amount determined by the Board of Directors
consistent with an annual compensation review of comparable positions of public
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companies, but in no event shall the base salary be less than Two Hundred Twenty
Thousand Dollars (US $220,000.00) ["Base Salary"]. Base Salary shall be paid in
semi-monthly installments during the Period of Employment.
5. Incentive Bonus
The Board of Directors and its compensation committee shall determine
any incentive bonus guidelines during the Period of Employment. Employee shall
be entitled to receive a bonus pursuant to the Company's bonus plan, and to
participate in a deferred compensation plan that may be in effect at the Company
from time to time. It is anticipated that any bonus plan for Employee shall
depend upon the Company's income performance as well as general performance
evaluations.
6. Expense Reimbursement
Employee shall be entitled to prompt and full reimbursement from the
Company for reasonable expenses incurred by Employee in performing services for
the Company. Employee shall be required to provide proof and documentation of
such expenditures as required by the Company.
7. Stock Options
Employee shall also be eligible to receive Company stock options during
the Period of Employment, pursuant to a Company stock options bonus plan that
may, as from time to time, be in effect.
8. Other Benefits
In addition to the benefits previously set forth in this Agreement,
Employee shall, during the Period of Employment, be entitled to the benefits
described below, and, as concerns all such benefit programs where years of
service are a factor, Employee shall, to the extent permitted by law, be given
full credit for his years of service with the Company prior to the
implementation of any benefit program, whether in his capacity as a director,
officer, or otherwise:
(a) Vacation. During the Period of Employment, Employee shall
be entitled to not less than six (6) weeks of paid vacation during each
calendar year during the Period of Employment. Accrued, but unused,
vacation time may carried over from year to year. At the end of the
term of his Agreement, Employee shall be paid a cash amount for the pro
rated portion of the accrued salary attributable to any unused vacation
time.
(b) Sick Leave. Leave time will be granted to the Employee
that is reasonable under the circumstances and that is consistent with
the Company's policies and procedures, as the same may be changed,
modified, or terminated for all Company employees from time to time.
(c) Insurance. Employee shall be entitled to participate in
the group insurance program of the Company as concerns life,
disability, medical, dental, vision, or employee assistance insurance
made available to other employees as the same may be implemented,
changed, modified, or terminated for all participants from time to
time. To the extent that such insurance benefits or programs are
offered to employees by the Company, the Company shall pay all premiums
for such coverage for Employee.
(d) Retirement Plan. The Employee shall be entitled to
participate in the Company's retirement plans in accordance with the
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terms and conditions of such plans and applicable law, as the same may
be implemented, changed, or terminated from time to time. Employee
shall become eligible to participate in the Company's retirement plans
as of the Effective Date or the date of implementation of such plans,
whichever is later.
(e) Other Miscellaneous Benefits. The Company shall pay or
reimburse Employee for the following miscellaneous benefits:
(i) Annual dues for association membership for relevant
professional groups; and
(ii) Subscriptions and purchase of books, journals,
publications, and other materials that relate to Employee's job duties
and responsibilities.
9. Term of Employment
(a) Term. The Company hereby agrees to continue the Employee
in its employ, and the Employee hereby agrees to remain in the employ
of the Company, in accordance with the terms and provisions of Section
3 of this Agreement, for the Period of Employment, thus terminating on
the third anniversary of the Effective Date of this Agreement.
(b) During the Period of Employment. The Employee's position,
authority, duties, and responsibilities shall be commensurate in all
material respects with those held and exercised as of the Effective
Date.
(c) Location. The Employee's services shall be performed at
the location where the Employee was employed on the Effective Date, or
at any office which is the headquarters of the Company, provided that
such headquarters are located in the Salt Lake City/Provo, Utah
metropolitan area.
10. Termination of Agreement
(a) Termination of the Employment by Employer. The Company
shall have the following rights with respect to termination of
Employee's employment.
(i) Cause. Employee's employment may be terminated
for Cause. For purpose of this Agreement, "Cause" shall mean
and refer to a determination made in good faith by the
Company's Board of Directors that:
(1) Employee has been convicted of, or has
entered into a plea of guilty or nolo contendere to,
a felony punishable by incarceration for a period of
one (1) year or longer;
(2) Employee has been convicted of
committing a theft, embezzlement, or other criminal
misappropriation of funds from the Company; or
(3) Employee has willfully failed or refused
to follow reasonable and lawful written policies or
directives established by the Board of Directors of
the Company, or Employee has willfully failed to
attend to material duties or obligations of
Employee's office (other than any such failure
resulting from Employee's incapacity due to physical
or mental
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illness, which is the cause or manifestation of
Employee's disability), which failure or refusal
continues for thirty (30) days following delivery of
a written demand from the Company's Board of
Directors for performance to Employee identifying the
manner in which Employee has failed to follow such
policy or directives or to perform such duties.
(ii) Effect Date of Termination. Termination pursuant
to this Section shall be effective as of the date of written
notice by the Board of Directors to Employee that it has made
the required determination, or at such other subsequent date,
if any specified in such notice.
(iii) Death. If Employee dies during the term of this
Agreement, his personal representative or designated survivor
should be entitled to receive all of the salary and benefits
provided hereunder for the remaining term of this Agreement.
(b) Termination by Employee. Employee shall have the right to
terminate his employment under this Agreement at any time for Good
Reason, provided Employee has delivered written notice to the Company
which briefly describes the facts underlying Employee's belief that
"Good Reason" exists and the Company has failed to cure such situation
within thirty (30) days after effective date of such notice.
(i) With Good Reason. For purposes of this Agreement,
"Good Reason" shall mean and consist of:
(1) A material breach by the Company of its
obligations under this Agreement;
(2) The assignment to Employee of duties
that are materially inconsistent with, or that
constitute a material alteration in the status of his
responsibilities set forth in this Agreement, as an
employee of the Company;
(3) Without Employee's prior written
consent, the transfer or relocation of Employee's
place of employment to any place other than the Salt
Lake City/Provo, Utah metropolitan area, except for
reasonable travel on the business of the Company; or
(4) Upon the consummation of a sale of all
or a substantial portion of the assets of the Company
not in the usual regular course of the business of
the Company in which sale the acquiring company did
not assume all the obligations of the Company under
this Agreement, or a change in control of the
ownership or management of the Company.
11. Confidential Information
The Employee shall hold in confidence for the benefit of the Company
all secret or confidential information, knowledge, or data relating to the
Company or any of its affiliated companies and their respective businesses,
which have been obtained by the Employee during the Employee's employment by the
Company or any of its affiliated companies and which shall not be or become
public knowledge (other than by acts of the Employee or representatives of the
Employee in violation of this Agreement). After termination of the Employee's
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employment with the Company, the Employee shall not, without prior written
consent of the Company or as may otherwise be required by law or legal process,
communicate or divulge any such information, knowledge, or data to anyone other
than the Company and those designated by the Company. In no event, however,
shall an asserted violation of the provisions of this Section constitute a basis
for deferring or withholding any amounts otherwise payable to the Employee under
the provisions of this Agreement.
12. Inventions
(a) Assignment. Without further consideration, the Employee
shall fully and promptly report to the Company all ideas, concepts,
inventions, discoveries, formulas, and designs conceived or produced by
the Employee at any time during the Period of Employment relating to
the Company's trade or business, whether patentable or unpatentable
(collectively, "Inventions"), and shall assign and hereby does assign
to the Company or its nominee the Employee's entire right, title, and
interest in and to all such Inventions.
(b) Cooperation. Employee shall take all reasonable action
requested by the Company to protect or obtain title to any and all
United States and/or foreign patents on any Inventions, including
execution and delivery of all applications, assignments, and other
documents deemed necessary or desirable by the Company, provided that
the Company shall reimburse the Employee for all expenses incurred by
the Employee in connection with such execution and delivery.
13. Non-Competition after Termination
(a) Acknowledgment. Employee acknowledges that his services
and responsibilities are of a particular significance to the Company,
and that his position with the Company does and will continue to give
him an intimate knowledge of its business. Because of this, it is
important to the Company that the Employee be restricted from the
competing with the Company in the event of the termination of his
employment.
(b) Agreement. Employee agrees that, in addition to any other
limitations, for a period of one (1) year after the termination of his
employment under this Agreement, Employee will not directly compete
with the Company or its business within the continental United States
of America.
14. Severance Pay
If Employee does not continue in the employ of the Company after the
termination of this Agreement, whether or not the Employee is offered or
continues employment by the Company, Company shall pay to Employee, no later
than thirty (30) days after termination, the sum of one year's annual Base
Salary in effect at the time of termination, plus the average of any Incentive
Bonus Payment made during the period prior to Employee's termination. (Thus, for
purposes of illustration, if, at the time of termination Employee's annual Base
Salary was $300,000 and the average of his Incentive Bonuses during the periods
prior to his termination was $400,000, Employee's severance pay would be the
total sum of $700,000.) Employee shall not be required to mitigate the amount of
the payment provided for in this section by seeking other employment or
otherwise; nor shall the amount of the severance payment be reduced by any
compensation earned by the Employee as a result of the employment by another
employer after termination or otherwise.
15. Vesting of Existing Stock Options
Existing Company stock options which have been granted by the Company
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to Employee for services as a member of the Company's Board of Directors shall
continue to vest in their entirety as previously scheduled and shall be
exercisable upon the vesting date.
16. Indemnification
The Company shall release, indemnify, defend, and hold harmless
Employee with respect to any and all losses, claims, actions, or suits of any
kind, nature, or description, whether before a trial or appellate court, or in
an administrative, arbitration, or alternative dispute resolution proceeding,
relating to, arising from, or in any way connected with the Employee's acts or
omissions as a director, officer, employee, or agent of the Company. Employee
shall be permitted to select independent defense counsel of his own choosing,
and such counsel shall promptly be reimbursed by the Company for all reasonable
fees, expenses, and costs incurred in the defense of Employee. In addition to
the foregoing, the Company shall at all times maintain appropriate insurance
coverage to protect Employee's interests as a director, officer, employee, or
agent of the Company.
17. Notice
Any notice or other communication required or permitted to be given to
the Parties under this Agreement shall be deemed to have been given when
received, addressed as follows (or at such other address as the party addressed
may have substituted by notice pursuant to this Section):
(a) If to the Company:
Xxxxx Technologies, Inc.
0000 Xxxxx Xxxxxxxx Xxxxx
Xxxxx 000
Xxxxx, Xxxx 00000
Attn: Chief Financial Officer
(b) If to Employee:
Xxxxx X. Xxxx
0000 Xxxx 00000 Xxxxx
Xxxxxxxx, Xxxx 00000
18. Governing Law
This Agreement shall in all respects be interpreted, construed, and
governed by and in accordance with the laws of the State of Utah.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date
Xxxxx Technologies, Inc.
/s/ Xxxxx Xxxxxxxxx
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Xxxxx Xxxxxxxxx
Chairman
Xxxxx X. Xxxx
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/s/ Xxxxx X. Xxxx
Xxxxx X. Xxxx
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