EXHIBIT 10(o)
EMPLOYMENT AGREEMENT
VICE PRESIDENT OF SYSTEM SALES AND SUPPORT
This Employment Agreement ("Agreement") is made and entered into as of this
30th day of January, 1998 by and between GREASE MONKEY HOLDING CORPORATION, a
Utah corporation ("Corporation") and XXXX X. XXXXXXX ("Executive").
WHEREAS, the Corporation and the Executive desire that the term of this
Agreement begin on January 30, 1998 ("Effective Date"); and
WHEREAS, the Corporation desires to employ the Executive as its Vice
President of System Sales and Support and Executive is willing to accept such
employment by the Corporation, on the terms and subject to the conditions set
forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained herein, the Corporation and the Executive hereby agree as follows:
SECTION 1. DUTIES. During the term of this Agreement, the Executive agrees to
be employed and to serve the Corporation as its Vice President of System
Sales and Support, and the Corporation agrees to employ and retain the
Executive in such capacity. In such capacity, the Executive shall render such
managerial, administrative and other services as are customarily associated
with or incident to such position and shall perform such other duties and
responsibilities for the Corporation as the Corporation may reasonably
require, consistent with such position. The Executive shall devote
substantially all of his business time, energy and skills to the affairs of
the Corporation, and shall report to the President and C.E.O.
SECTION 2. TERM OF EMPLOYMENT.
2.1 DEFINITIONS. For the purposes of this Agreement the following terms shall
have the following meanings:
2.1.1 "Termination For Cause" shall mean termination by the Corporation of
the Executive's employment by the Corporation by reason of: (i) a conviction
of Executive of a felony (whether or not such conviction is subject to
appeal), (ii) fraud, (ii) misappropriation of any property or business of
Corporation, (iv) default of any term or obligation of this Agreement, (v)
death of the Executive, or (vi) dishonesty, gross neglect of duty,
disparagement of the Corporation or other intentional acts or omissions which
negatively and materially impact or impair the Corporation's ability to
conduct its ordinary business in its usual manner.
2.1.2 "Termination Other Than For Cause" shall mean termination by the
Corporation of the Executive's employment by the Corporation (other than in a
Termination for Cause)
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and shall include constructive termination of the Executive's employment by
reason of material breach of this Agreement by the Corporation, such
constructive termination to be effective upon notice from the Executive to
the Corporation of such constructive termination.
2.1.3 "Voluntary Termination" shall mean termination by the Executive of the
Executive's employment by the Corporation other than (i) Constrictive
Termination as described herein, (ii) "Termination Upon a Change in Control,"
and (iii) termination by reason of the Executive's death or disability as
described herein.
2.1.4 "Termination Upon a Change in Control" shall mean a termination by the
Executive of the Executive's employment with the Corporation within 120 days
following a "Change in Control."
2.1.5 "Change in Control" shall mean (i) the time that the Corporation first
determines that any person and all other persons who constitute a group
(within the meaning of Section 13(d)(3) of the Securities Exchange Act of
1934 ("Exchange Act")) have acquired direct or indirect beneficial ownership
(within the meaning of Rule 13d-3 under the Exchange Act) of twenty percent
(20%) or more of the Corporation's outstanding securities, unless a majority
of the "Continuing Directors" approves the acquisition not later than ten
(10) business days after the Corporation makes that determination, or (ii)
the first day on which a majority of the members of the Corporation's board
of directors are not "Continuing Directors."
2.1.6 "Continuing Directors" shall mean, as of any date of determination, any
member of the Corporation's board of directors of the Corporation who (i) was
a member of that board of directors on January 30, 1998, (ii) has been a
member of that board of directors for the two years immediately preceding
such date of determination, or (iii) was nominated for election or elected to
the Corporation's board of directors with the affirmative vote of the greater
of (x) a majority of the Continuing Directors who were members of the
Corporation's board of directors at the time of such nomination or election
or (y) at least three Continuing Directors.
2.2 INITIAL TERM. The term of employment of the Executive by the Corporation
shall be for a period of three years beginning with Effective Date ("Initial
Term"), unless terminated earlier pursuant to this Agreement. At any time
prior to the expiration of the Initial Term, the Corporation and the
Executive may by mutual written agreement extend the Executive's employment
under the terms of this Agreement for such additional periods as they may
agree.
2.3 TERMINATION FOR CAUSE. Termination For Cause may be effected by the
Corporation at any time during the term of this Agreement and shall be effected
by written notification to the Executive. Upon Termination For Cause, the
Executive shall
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promptly be paid all accrued salary, bonus compensation to the extent earned,
vested deferred compensation (other than pension plan, stock incentive plan
or profit sharing plan benefits which will be paid in accordance with the
applicable plan), any benefits under any plans of the Corporation in which
the Executive is a participant to the full extent of the Executive's rights
under such plans, accrued vacation pay and any appropriate business expenses
incurred by the Executive in connection with his duties hereunder, all to the
date of termination, but the Executive shall not be paid any other
compensation or reimbursement of any kind, including without limitation,
Severance Compensation.
2.4 TERMINATION OTHER THAN FOR CAUSE. Notwithstanding anything else in this
Agreement, the Corporation may effect a Termination Other Than For Cause at
any time upon giving written notice to the Executive of such termination.
Upon any Termination Other Than For Cause, the Executive shall promptly be
paid all accrued salary, bonus compensation to the extent earned, vested
deferred compensation (other than pension plan, stock incentive plan or
profit sharing plan benefits which will be paid in accordance with the
applicable plan), any benefits under any plans of the Corporation in which
the Executive is a participant to the full extent of the Executive's rights
under such plans (including accelerated vesting, if any, of awards granted to
the Executive under the Corporation's stock option plan), accrued vacation
pay and any appropriate business expenses incurred by the Executive in
connection with his duties hereunder, all to the date of termination, and all
Severance Compensation provided, but no other compensation or reimbursement
of any kind.
2.5 TERMINATION BY REASON OF DISABILITY. If, during the term of this
Agreement, the Executive, in the reasonable judgment of the Corporation's
board of directors, has failed to perform his duties under this Agreement on
account of illness or physical or mental incapacity, and such illness or
incapacity continues for a period of more than two consecutive months, the
Corporation shall have the right to terminate the Executive's employment
hereunder by written notification to the Executive and payment to the
Executive of all accrued salary, bonus compensation to the extent earned,
vested deferred compensation (other than stock incentive plan, pension plan
or profit sharing plan benefits which will be paid in accordance with the
applicable plan), any benefits under any plans of the Corporation in which
the Executive is a participant to the full extent of the Executive's rights
under such plans, accrued vacation pay and any appropriate business expenses
incurred by the Executive in connection with his duties hereunder, all to the
date of termination, with the exception of medical and dental benefits which
shall continue through the expiration of this Agreement, but the Executive
shall not be paid any other compensation or reimbursement of any kind,
including without limitation, Severance Compensation.
2.6 DEATH. In the event of the Executive's death during the term of this
Agreement, the Executive's employment shall be deemed to have terminated as
of the last day of the month during which his death occurs and the
Corporation shall promptly pay to his
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estate or such beneficiaries as the Executive may from time to time designate
all accrued salary, bonus compensation to the extent earned, vested deferred
compensation (other than stock incentive plan, pension plan or profit sharing
plan benefits which will be paid in accordance with the applicable plan), any
benefits under any plans of the Corporation in which the Executive is a
participant to the full extent of the Executive's rights under such plans,
accrued vacation pay and any appropriate business expenses incurred by the
Executive in connection with his duties hereunder, all to the date of
termination, but the Executive's estate shall not be paid any other
compensation or reimbursement of any kind, including without limitation,
Severance Compensation.
2.7 VOLUNTARY TERMINATION. In the event of a Voluntary Termination, the
Corporation shall promptly pay all accrued salary, bonus compensation to the
extent earned, vested deferred compensation (other than stock incentive plan,
pension plan or profit sharing plan benefits which will be paid in accordance
with the applicable plan), any benefits under any plans of the Corporation in
which the Executive is a participant to the full extent of the Executive's
rights under such plans, accrued vacation pay and any appropriate business
expenses incurred by the Executive in connection with his duties hereunder,
all to the date of termination, but no other compensation or reimbursement of
any kind, including without limitation, Severance Compensation.
Notwithstanding the above to the contrary, if the Corporation changes the
Executive's title, working conditions or specifies duties so that the
Executive's powers and duties are diminished or reduced, or include powers,
duties or working conditions which are not generally consistent with the
title of Vice President of System Sales and Support (a "Constructive
Termination"), or if the Corporation changes the reporting relationship so
that the Executive reports to another officer or employee, other than the
President and C.E.O., then at any time thereafter, at the Executive's option
and upon thirty days notice, and provided that such changes shall not have
been rescinded or corrected to the reasonable satisfaction of the Executive
within said thirty day period, the Executive shall have the right to
terminate the employment relationship, and in such event, the employment
shall be deemed to have been terminated by the Corporation without cause.
2.8 TERMINATION UPON A CHANGE IN CONTROL. In the event of a Termination Upon
a Change in Control, the Executive shall immediately be paid all accrued
salary, bonus compensation to the extent earned, vested deferred compensation
(other than pension plan or profit sharing plan benefits which will be paid
in accordance with the applicable plan), any benefits under any plans of the
Corporation in which the Executive is a participant to the full extent of the
Executive's rights under such plans (including accelerated vesting, if any,
of any awards granted to the Executive under the Corporation's Stock Option
Plan), accrued vacation pay and any appropriate business expenses incurred by
the Executive in connection with his duties hereunder, all to the date of
termination, and all Severance Compensation, but no other compensation or
reimbursement of any kind.
2.9 NOTICE OF TERMINATION. The Corporation may effect a termination of this
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Agreement pursuant to the provisions of this Section upon giving thirty (30)
days' written notice to the Executive of such termination. The Executive may
effect a termination of this Agreement pursuant to the provisions of this
Section upon giving thirty (30) days' written notice to the Corporation of
such termination.
SECTION 3. SALARY, BENEFITS AND BONUS COMPENSATION.
3.1 BASE SALARY. As payment for the services to be rendered by the Executive
as provided in Section 1 and subject to the terms and conditions of Section
2, the Corporation agrees to pay to the Executive a base salary beginning at
the Effective Date at the rate of $92,500 per annum payable in bi-monthly
installments. The Executive's base salary shall be reviewed annually by the
President and C.E.O. and the base salary for each year (or portion thereof)
beginning January 1, 1998 shall be determined by the President and C.E.O. who
may authorize an increase in the Executive's base salary.
3.2 BONUSES. The Executive shall be eligible to receive a discretionary bonus
for each year (or portion thereof) during the term of this Agreement and any
extensions thereof, with the actual amount of any such bonus to be determined
in the sole discretion of the President and C.E.O. based upon its evaluation
of the Executive's performance during such year. All such bonuses shall be
reviewed annually by the President and C.E.O.
3.3 ADDITIONAL BENEFITS. During the term of this Agreement, the Executive
shall be entitled to the following fringe benefits:
3.3.1 Executive Benefits. The Executive shall be eligible to participate in
such of the Corporation's benefits and deferred compensation plans as are now
generally available or later made generally available to executive officers
of the Corporation, including, without limitation, the Corporation's Stock
Incentive Plan, profit sharing plans, annual physical examinations, dental
and medical plans, personal catastrophe and disability insurance, life
insurance, financial planning, retirement plans and supplementary executive
retirement plans, if any. For purposes of establishing the length of service
under any benefit plans or programs of the Corporation, the Executive's
employment with the Corporation will be deemed to have commenced on the
Effective Date.
3.3.2 Vacation. The Executive shall be entitled to three weeks of vacation
during each year during the term of this Agreement and any extensions
thereof, prorated for partial years.
3.3.3 Reimbursement for Expenses. During the term of this Agreement, the
Corporation shall reimburse the Executive for reasonable and properly
documented out-of-pocket business and/or entertainment expenses incurred by
the Executive in connection with his duties under this Agreement.
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3.3.4 Stock Options. The Corporation shall grant to Executive, stock options
on One Hundred Thousand (100,000) shares of the Corporation's common stock
with an exercise price of $1.3125. Such stock options shall be issued and
held in accordance with the Corporation's Stock Incentive Plan currently in
effect.
SECTION 4. SEVERANCE COMPENSATION.
4.1 SEVERANCE COMPENSATION IN THE EVENT OF A TERMINATION UPON A CHANGE IN
CONTROL. In the event the Executive's employment is terminated in a
Termination Upon a Change in Control, the Executive shall be paid as
severance compensation ("Severance Compensation") his base salary (at the
rate payable at the time of such termination), for a period of twelve (12)
months from the date of such Termination Upon a Change in Control.
Notwithstanding anything in this Section to the contrary, the Executive may
in the Executive's sole discretion, by delivery of a notice to the
Corporation within thirty (30) days following a Termination Upon a Change in
Control, elect to receive from the Corporation, a lump sum Severance
Compensation payment by bank cashier's check equal to the present value of
the flow of cash payments that would otherwise be paid to the Executive
pursuant to this Section. The Executive shall also be entitled to an
accelerated vesting of any awards granted to the Executive under the
Corporation's Stock Incentive Plan to the extent provided in the stock option
agreement entered into at the time of grant. The Executive shall continue to
accrue retirement benefits and shall continue to enjoy any benefits under any
plans of the Corporation in which the Executive is a participant to the full
extent of the Executive's rights under such plans, including any perquisites
provided under this Agreement, though the remaining term of this Agreement.
4.2 SEVERANCE COMPENSATION IN THE EVENT OF A TERMINATION OTHER THAN FOR
CAUSE. In the event the Executive's employment is terminated in a Termination
Other Than for Cause, the Executive shall be paid as Severance Compensation
his Base Salary (at the rate payable at the time of such termination), for a
period of the lesser of the remaining portion of the Initial Term or twelve
(12) months from the date of such termination, on the dates specified in
Section 3.1; provided, however, that if the Executive is employed by a new
employer during such period, the Severance Compensation payable to the
Executive during such period will be reduced by the amount of compensation
that the Executive is receiving from the new employer, officer. However, the
Executive is under no obligation to mitigate the amount owed to the officer
pursuant to this Section by seeking employment or otherwise. The Executive
shall be entitled to an accelerated vesting of any awards granted to the
Executive under the Corporation's Stock Incentive Plan to the extent provided
in the stock option agreement entered into at the time of grant.
4.3 NO SEVERANCE COMPENSATION UPON OTHER TERMINATION. In the event of a
Voluntary Termination, Termination For Cause, termination by reason of the
Executive's death or disability as described herein, the Executive or his
estate shall not be paid any Severance Compensation.
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4.4 LIMIT ON AGGREGATE COMPENSATION UPON A CHANGE IN CONTROL.
Notwithstanding anything else in this Agreement, solely in the event of a
Termination Upon a Change in Control, the amount of Severance Compensation
paid to the Executive, but exclusive of any payments to the Executive in
respect of any stock options then held by the Executive (or any compensation
deemed to be received by the Executive in connection with the exercise of any
stock options at any time) or by virtue of the Executive's exercise of a
right under the Stock Incentive Plan upon a Change in Control, shall not
include any amount that the Corporation is prohibited from deducting for
federal income tax purposes by virtue of Section 28OG of the Internal Revenue
Code or any successor provision.
SECTION 5. OUTSIDE ACTIVITIES OF EXECUTIVE. Nothing in this Agreement shall
preclude the Executive from devoting time during reasonable periods required
for investing personal assets and/or those of family members in such form or
manner that will not violate this Agreement and these activities will be
permitted so long as they do not materially adversely affect the performance
of the Executive's duties and obligations to the Corporation.
SECTION 6. WITHHOLDINGS. All compensation and benefits to the Executive
hereunder shall be reduced by all federal, state, local and other
withholdings and similar taxes and payments required by applicable law.
SECTION 7. INDEMNIFICATION. In addition to any rights to indemnification to
which the Executive is entitled to under the Corporation's articles of
incorporation and bylaws, the Corporation shall indemnify the Executive at
all times during and after the term of this Agreement to the maximum extent
permitted under the Colorado Business Corporation Act or any successor
provision thereof and any other applicable state law, and shall pay the
Executive's expenses in defending any civil or criminal action, suit, or
proceeding in advance of the final disposition of such action, suit or
proceeding, to the maximum extent permitted under such applicable state laws.
SECTION 8. PROPRIETARY INFORMATION. Executive shall use his best efforts to
preserve and protect the confidentiality of all proprietary and confidential
information regarding the Corporation and its affiliates which he obtains or
of which he otherwise becomes aware during the course of providing the
services described in this Agreement (other than information that is already
publicly available or which he may be required by law to disclose)
("Confidential Information"). Executive shall not disclose any Confidential
Information to any entity other than (i) the Corporation's employees or its
designated agents, or (ii) other than as necessary in the ordinary course of
business. Executive acknowledges that the Confidential Information is a
unique and valuable asset of the Corporation, represents a substantial
investment of time and expense by the Corporation, and that any disclosure or
other use of such information other than for the benefit of the Corporation
would cause irreparable harm.
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SECTION 9. RECORDS. Executive will keep complete, accurate and authentic
accounts, notes, data and records ("Records") of his actions. The Records
shall be the property of the Corporation. Upon request, Executive will
promptly deliver the Records to the Corporation. Upon termination of this
Agreement, Executive shall deliver promptly to the Corporation all Records,
manuals, books, blank forms, documents, letters, memoranda, notes, notebooks,
reports, data, tables, calculations or copies thereof, which relate in any
way to the business, property, practices or techniques of the Corporation,
including, but not limited to, all documents which in whole or in part
contain any Confidential Information.
SECTION 10. NON-COMPETITION COVENANT.
10.1 AGREEMENT NOT TO COMPETE. Executive agrees that, during the term of
this Agreement and for a period of two years following the termination of
this Agreement, he shall not, without the express written consent of the
Corporation, engage in competition with the Corporation, directly or
indirectly, in any manner or capacity (e.g., as an advisor, principal, agent,
partner, officer, director, stockholder, employee, member of any association,
or otherwise) in any phase of any business of a type conducted by the
Corporation.
10.2 GEOGRAPHIC EXTENT OF COVENANT. The obligations of Executive under this
section 10 shall apply to the United States.
SECTION 11. MISCELLANEOUS.
11.1 COUNTERPARTS. This Agreement may be executed in several counterparts,
and all so executed shall constitute one Agreement, binding on all parties
hereto, notwithstanding that all of the parties are not signatories to the
original or the same counterpart.
11.2 ASSIGNMENT. The agreement of Executive to render services hereunder is
personal in nature and shall not be assignable by Executive. The rights and
benefits of Executive under this Agreement shall not be subject to voluntary
or involuntary alienation, assignment or transfer. The terms and provisions
of this Agreement shall be binding upon and shall inure to the benefit of the
successors and permissible assigns of the respective parties.
11.3 ENTIRE AGREEMENT. This Agreement is the entire agreement between
Executive and The Corporation pertaining to the subject matter hereof and
supersedes any and all prior negotiations, agreements, understandings and
dealings pertaining to the subject matter hereof, whether written or oral.
11.4 AMENDMENTS AND MODIFICATIONS. This Agreement cannot be changed orally, and
no agreement shall be effective to waive, change, modify or discharge it in
whole or in part unless such agreement is in writing and is signed by the
parties against whom enforcement
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of any waiver, change, modification or discharge is sought.
11.5 SEVERABILITY. If any provision of this Agreement is determined by a
court of competent jurisdiction to be invalid or unenforceable, the remainder
of this Agreement shall nonetheless remain in full force and effect.
11.6 EFFECT OF HEADINGS. Paragraph titles or captions contained in this
Agreement are inserted only as a matter of convenience and for reference.
Such titles and captions in no way define, limit, extend or describe the
scope of this Agreement nor the intent of any provision thereof.
11.7 GOVERNING LAW. The parties expressly agree that all the terms and
provisions hereof shall be construed in accordance with the substantive laws
of the State of Colorado.
11.8 NOTICES. All notices provided for hereunder shall be in writing and
shall be deemed given and received (a) when personally delivered; (b)
transmitted by facsimile transmission, provided sender obtains an electronic
confirmation and also delivers a copy by mail or personal delivery, or (c)
forty-eight (48) hours after the same are deposited in the United States
mail, postage prepaid, registered or certified mail, return receipt
requested, addressed to the applicable party at the following address: (i) if
the Executive, to his office at the Corporation and (ii) if to the
Corporation, to 000 00xx Xxxxxx, Xxxxx 0000, Xxxxxx, XX 00000, Attention:
Xxxxxxx X. Xxxxxxxxxxx, or at such other office as he may designate from time
to time.
IN WITNESS WHEREOF, the parties hereto have executed this Employment
Agreement as of the day and year first above written.
Grease Monkey Holding Corporation, a Utah corporation
/s/ Xxxxxxx X. Xxxxxxxxxxx
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By: Xxxxxxx X. Xxxxxxxxxxx
Its: President and C.E.O.
/s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx
