EXHIBIT 10.41
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NON-COMPETITION, NON-SOLICITATION
AND EMPLOYMENT AGREEMENT
This NON-COMPETITION, NON-SOLICITATION AND EMPLOYMENT AGREEMENT is
made and entered into as of March 28, 2002 by and between Host America
Corporation a Colorado corporation (the "Company") and Xxxxx Xxxxxx (the
"Employee").
WHEREAS, the Company has purchased the assets of Select Force located
at 0000 Xxxxx Xxxxxxxx, Xxxxx 000, Xxxxxxxx Xxxx, XX 00000, and Employee is
employed by Select Force.
WHEREAS, the Company desires to employ the Employee, and the Employee
desires to accept such employment, on the terms and conditions set forth
herein.
The parties agree as follows:
1. DEFINITIONS. The following terms shall have the indicated
meanings when used in this Agreement, unless the context requires
otherwise:
a. "Effective Date" shall be immediately upon the execution of
this Agreement by both parties.
b. "Benefit Plan" shall mean each vacation pay, sick pay,
retirement, welfare, medical, dental, disability, life insurance or other
employee benefit plan, program or arrangement.
c. "Cause" shall mean (i) the conviction of Employee of a
felony or (ii) the admission by Employee of an act of fraud or embezzlement
involving assets of the Company or its customers, suppliers or affiliates
or (iii) the reasonable determination by the Company communicated by
written notice to the Employee that there has been a material breach by the
Employee of any of Employee's material obligations under this Agreement
which results in a material adverse effect on the Company, provided that if
such a conduct is of a nature subject to cure the Company will have given
the Employee prior written notice of such conduct and its intention to
terminate Employee's employment and afforded the Employee a reasonable
opportunity to cure Employee's conduct.
d. "Date of Termination" shall mean (A) if termination of
employment occurs by reason of death, the date of Employees' death or (B)
if termination of employment occurs for any other reason, the date on which
a Notice of Termination is delivered to the other party.
e. "Notice of Termination" shall mean a written notice, which
shall set forth in reasonable detail the facts, and circumstances that
provided the basis for such termination.
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2. EMPLOYMENT. The Company hereby employs Employee, and Employee
hereby accepts employment with the Company, on the terms and subject to the
conditions set forth herein
The Company hereby agrees to employ and engage the services of
the Employee to act in the capacity of, President of Select Force.
Employee's primary responsibility will be to achieve sales growth. Employee
will also be responsible for managing the Oklahoma City office in an
efficient manner. To aid in the administration functions, the Company will
assist in the general bookkeeping of Select Force. As an Executive, the
Employee's duties and authorities will be consistent with such position and
Employee shall be subject to the direction and control of the President of
the Company. Employee's authorization levels are attached to this Agreement
as Attachment A. The Employee agrees, during Employee's employment, to
devote substantially Employee's full business time to the business and
affairs of the Company (except for (a) services on Corporate, civic, or
charitable boards or committees, which do not significantly interfere with
the performance of Employee's responsibilities hereunder, (b) such
reasonable time as shall be required for the investment of the Employee's
assets, which do not significantly interfere with the performance of
Employee's responsibilities, and (c) periods of vacation and sick leave
to which Employee is entitled) and to use Employee's best efforts to
promote the interests of the Company and to perform faithfully and
efficiently the responsibilities of an Executive.
3. TERM. This Agreement and Employee's employment will continue for
a term of three (3) years from the date of this Agreement, unless and until
terminated by either party in accordance with the terms of this agreement.
4. TERMINATION OF SERVICE.
a. TERMINATION UPON DEATH. Employee's employment hereunder
shall terminate upon Employee's death.
b. TERMINATION UPON DISABILITY. If, as a result of a complete
mental or physical disability, Employee shall have been absent from
Employee's duties hereunder on a full-time basis for three (3) consecutive
months, ("Disability") and, within 30 days after the Company notifies
Employee in writing that it intends to replace Employee, Employee shall not
have returned to the performance of Employee's duties on a full-time basis,
the Company shall be entitled to terminate Employee's employment. In
addition, Employee shall, upon Employee's Disability, have the right to
terminate Employee's employment with the Company. If such employment is
terminated (whether by the Company or by Employee as a result of Employee's
Disability, the following shall apply:
c. The Company shall continue to pay Employee the Base Salary
to which Employee would otherwise be entitled through the remainder of the
calendar month during which such termination is effective.
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d. TERMINATION FOR CAUSE. The Company shall be entitled to
terminate Employee's employment for Cause, in which event the Company shall
continue to pay Employee the Base Salary to which Employee would otherwise
be entitled through the Date of Termination;
e. TERMINATION BY EMPLOYEE. Employee may terminate this
Agreement at the end of the third year of the Term of this Agreement upon
ninety-day (90) prior written notice to the Company.
In the event of a termination of this agreement by Employee resulting
from a breach described in section (d) above, the provisions of Section 9
of this Agreement shall also be terminated as the date of termination of
this Agreement.
f. NOTICE OF TERMINATION. Any termination of Employee's
employment by the Company shall be communicated by a Notice of Termination
to the other party.
5. COMPENSATION AND OTHER BENEFITS.
a. BASE SALARY. During each Contract Year of the term hereof,
the Company will pay to the Employee for services rendered by Employee to
the Company compensation at a rate of $82,420. Per year (the "Base Salary")
to be paid weekly. Yearly increases will be based on performance.
b. BENEFIT PLANS. Employee shall be entitled to participate in
and receive benefits under all of the Company's Benefit Plans or programs
generally available to senior management of the Company, including, any 401
K Plan, retirement, disability insurance plans and all other plans or
programs. Nothing paid to Employee under any Benefit Plan presently in
effect or made available in the future shall be deemed to be in lieu of
compensation payable to Employee hereunder. The Company shall pay the full
premium applicable to any such benefits for the Employee and Employee's
dependents.
(i) VACATION TIME. During the term hereof, Employee shall
be entitled up to three (3) weeks paid vacation during each Contract Year,
as Employee deems reasonable. Any vacation time that is not taken in a
given Contract Year shall be carried forward to the following Contract Year
or Contract Years, as the case may be, but in no event more than two (2)
weeks, on a cumulative basis. No monetary equivalent will be allowed in
lieu of actual vacation days.
(ii) SICK TIME. During the term hereof, Employee shall be
entitled up to five (5) days of paid sick leave during each Contract Year.
Any sick leave that is not taken in a given Contract Year shall be carried
forward to the following Contract Year or Contract Years, as the case may
be, but in no event more than two (2) weeks, on a cumulative basis. No
monetary equivalent will be allowed in lieu of actual sick leave.
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c. INCENTIVE PLAN. Within three (3) months of the Effective
Date, the Company will develop a quarterly incentive plan paid in a
combination of the Company's stock and cash based on a 50% split of profits
over 10%.
d. OTHER BENEFITS. Company will nominate and support
nomination of Employee to a seat on the Board of Directors for Company.
6. DEDUCTIONS. The Employee authorizes the Company to make such
deductions and withholdings from Employee's compensation as are required by
law or as reasonable directed by the Company for its Employees generally,
which deduction will include, without limitation, deductions for federal
and state income taxes and Social Security.
7. NON-DISCLOSURE OF CONFIDENTIAL, PROPRIETARY AND TRADE SECRET
INFORMATION.
a. "Confidential, Proprietary and Trade Secret Information"
shall mean any secret or information of a secret, proprietary, or
confidential nature relating to the Company and/or any client which is
known to the Employee as a result of Employee's employment with the Company
or originated by the Employee, including, without limitation, all methods,
processes, products, techniques, know-how, marketing strategies and plans,
data, financial statements and projections, business plans, inventions,
improvements, or discoveries (whether or not patenable or copyrightable),
price lists, forecasts, customer lists, customer files, and customer
requirements, unless such information is in the public domain to such an
extent as to be readily available to competitors.
b. The Employee acknowledges that the Confidential, Proprietary
and Trade Secret Information constitutes a valuable and unique asset of the
Company with independent economic value. The Employee agrees that Employee
will not, directly or indirectly, use, communicate, disclose, disseminate,
or put in the public domain, any Confidential, Proprietary and Trade Secret
Information or any other information of a secret, proprietary,
confidential, or generally undisclosed nature relating to the business of
the Company. The Employee hereby assigns any rights Employee may otherwise
possess in any Confidential, Proprietary and Trade Secret Information to
the Company.
c. This section shall survive the termination of the Employee's
employment.
d. Nothing in this Agreement is intended to limit the Company's
rights under an applicable trade secrets statute.
e. Employee understands that a violation of this Agreement may
result in disciplinary action, including possible termination, and/or legal
action.
9. NON-SOLICITATION AND COVENANT NOT TO COMPETE. In consideration
of the Employee's employment by the Company as an Executive and because the
Employee shall have access to Confidential, Proprietary and Trade Secret
Information, the Employee hereby covenants as follows:
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For a period of three (3) years from the Effective Date or one (1)
year from the termination of Employee's employment, whichever is longer,
the Employee agrees that, within the territory defined below, Employee
shall not directly or indirectly, personally, by agency, as an employee,
through a corporation, partnership, limited liability company, or by any
other artifice or device, provide or attempt:
(a) to provide any services in the employee screening industry.
(b) to provide any employee screening services to any of the
Company's clients to which, within one year prior to the termination of
this Agreement, the Employee has provided services in any capacity on
behalf of the Company, or the Employee has been introduced or about which
the Employee has received information through the Company or through any
Client for which the Employee has performed services in any capacity on
behalf of the Company.
(c) to retain or attempt to retain for himself or any other
party, the services of any person, including any of the Company's employees
or consultants, who have provided services to or on behalf of the Company
within one year prior to the termination of the Employee's employment, and
to whom the Employee has been introduced or about whom the Employee has
received information through the Company or through any Client for which
the Employee has performed services in any capacity on behalf of the
Company.
(d) to utilize Confidential, Proprietary or Trade Secret
Information to solicit any suppliers or customers of the Company or in any
way induces them not to continue in their relationship with the Company.
Furthermore, Employee covenants and agrees not to disrupt, damage, impair
or interfere with the business or operations of the Company, including by
way of the Company, including by way of disrupting its relationships with
customers, agents, representatives, vendors, or otherwise.
The term "territory" means the geographic area within a one hundred
fifty (150) mile radius of a facility of location of Select Force's
operations and any account that Select Force provided services or
solicited.
The Employee acknowledges that irreparable harm to the Company will
result from the breach of the Covenant Not to Compete. Notwithstanding
anything to the contrary herein contained, in the event of a material
breach by the Company of its obligations under this Agreement, which breach
is continuing and remains uncured for a period of ninety (90) days and so
long as the Employee is not in material breach of Employee's obligations
under this Agreement, then the provisions of this section 9 shall be
unenforceable.
10. RIGHTS AND BENEFITS PERSONAL. Except as herein otherwise
specifically provided, the rights and benefits of the Employee under this
Agreement are personal to Employee and no such rights or benefits will be
subject to voluntary or involuntary alienation, assignment, or transfer.
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11. NON-ALIENATION. The Employee shall not have any right to pledge,
hypothecate, anticipate, or in any way create a lien or security interest
upon any amounts provided under this Agreement; and no benefits payable
hereunder shall be assignable in anticipation of payment either by
voluntary or involuntary acts, or by operation of law, except by will or
the laws of descent and distribution.
12. ATTORNEYS' FEES. Employee and Company acknowledges that
Employee's or Company's breach of any of the provisions of this Agreement
could result in irreparable and unreasonable harm to the Company or the
Employee and that injunctive relief, as well as damages, would be
appropriate for a breach of any of such provisions. If any action or
proceeding is brought because of an alleged dispute or default in
connection with this Agreement, the prevailing party shall be entitled to
recover reasonable attorneys' fees and costs in connection with such action
or proceeding in addition to all other recovery or relief.
13. SEVERABILITY. Whenever there is any conflict between any
provision of this Agreement and any statute, law, regulation, or judicial
precedent, the latter will prevail, but in each such event, the provisions
of this Agreement thus affected will be curtailed and limited only to the
extent necessary to bring them within the requirement of law. If any part,
section, paragraph, or clause of this Agreement will be held by a court of
proper jurisdiction to be indefinite, invalid, or otherwise unenforceable,
the entire Agreement will not fail on account thereof, but the balance of
this Agreement will continue in full force and effect unless such
construction would be clearly contrary to the intention of the parties or
would be unconscionable.
14. ENTIRE AGREEMENT; MODIFICATION; WAIVER. This Agreement together
constitutes the entire Agreement between the parties pertaining to the
subject matter contained in it and supersedes all prior and contemporaneous
agreements, representations, and understandings of the parties. No
supplement, modification, or amendment of this Agreement will be binding
unless executed in writing by both parties. No waiver of any of the
provisions of this Agreement will be deemed to or will constitute a waiver
of any other provisions, whether or not similar, nor will any waiver
constitute a continuing waiver. No waiver will be binding unless executed
in writing by the party making the waiver.
15. NOTICES. Any notices, requests, demands and other communications
provided for by this Agreement shall be sufficient if in writing and if
sent by registered or certified mail to the Employee at the last address
Employee has filed in writing with the Company or, in the case of the
Company, Attention: President, at its principal business offices.
16. SUCCESSOR TO THE COMPANY. Except as may be otherwise provided
herein, this Agreement shall be binding upon and inure to the benefit of
the Company and any successor of the Company.
17. JURISDICTION AND VENUE. The parties acknowledge that the
execution of this Agreement has occurred or will occur in the State of
Connecticut. Without limiting the right of the parties to pursue their
rights and remedies under this Agreement (or under any judgment obtained in
respect thereof) in any appropriate jurisdiction, the parties hereby
irrevocably consent to the jurisdiction and venue of the courts of the
State of Connecticut or any United
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States court of competent jurisdiction situated therein, to adjudicate any
legal action commenced by a party and waive any objections they may at any
time have to such jurisdiction and venue.
18. GOVERNING LAW. The provisions for this Agreement for all purposes
will be construed in accordance with the laws of the State of Connecticut.
IN WITNESS WHEREOF, the following Agreement was executed as of the
date and year first above written.
HOST AMERICA CORPORATION, a
Colorado Corporation
By: /s/ XXXXXXXX XXXXXX
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Xxxxxxxx Xxxxxx, President
Employee:
/s/ XXXXX XXXXXX
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Xxxxx Xxxxxx
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EXHIBIT A
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EMPLOYEE'S AUTHORITY
Pursuant to the terms and conditions of the Employment Agreement to
which this Exhibit A is attached, Employee is hired to solicit sales for
all services rendered by Select Force and such other sales as directed by
the Company. The Employee will have the authority to incur expenses and
make commitments within the guidance set forth below. The following actions
require the consent of Host America.
1. Incurring a single general operating expenses above $5,000
2. Hiring or terminating employees with total annual
compensation greater than $30,000.
3. Annual base salary increases for employees of 10% or greater
and all bonus payments (subject to any bonus plans in
existence or, in the future) for employees in excess of
$10,000 per annum in the aggregate.
4. Hiring and compensation changes with related party
employees.
5. Any capital expenditures over $5,000.
6. New leases or modifications to existing leases where the
aggregate lease commitment are above $5,000.
7. Engagement of any marketing, management or other business
consultant.
8. Execution of consumer contracts where the expected total
revenue is in excess of $10,000.
All expense reports are to be submitted in accordance with the Company's
policies as in place from time to time.
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