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EMPLOYMENT/NON-COMPETE AGREEMENT
This Employment Agreement (the "Agreement"), effective as of this 28th
day of April, 1997, is between Granite Financial Inc., a Delaware corporation
("Company"), and Xxxxx Xxxxx ("LW").
RECITALS
A. The Company desires to hire LW to serve as the President and Chief
Operating Officer of the Company.
B. LW desires to accept such employment by the Company.
NOW, THEREFORE, in consideration of the mutual promises set forth
herein, the parties agree as follows:
1. Employment. Upon the terms and subject to the conditions contained
herein, LW shall, during the term of this Agreement, serve as President
and Chief Operating Officer of the Company and shall perform such duties
and responsibilities as designated from time to time by Chairman and
Chief Executive Officer of the Company. LW hereby accepts such
position and, during the term of this Agreement, shall devote his full
time, skill, energy and attention to the business of the Company.
2. Term. The period of employment under this Agreement shall commence as
of the date hereof and, subject to the terms and conditions hereof,
shall terminate on June 30, 1998. The Company shall have the option to
extend the period of employment for an additional one year at the end
of the initial term by notice to LW given on or prior to March 31,
1998. The period of employment is referred to hereinafter as the
"Employment Term."
3. Compensation.
3.1 Salary. During the Employment Term, Company shall pay LW an
annual salary of $120,000. If, prior to the scheduled
expiration of the Employment Term, Company terminates LW
without Cause (as hereinafter defined), Company shall remain
obligated to pay LW his salary hereunder, when the same
becomes due, and continue to provide LW with all benefits
under Section 3.2 below through the expiration of the
Employment Term. The salary shall be paid in accordance with
the Company's payroll policy in effect from time to time,
currently twice per month on the 15th and the last day
of each month.
3.2 Benefit Plans. During the Employment Term, LW shall be
entitled to participate in all benefit plans applicable to
employees of Company, and to be entitled to all other benefits
and perquisites, to the extent eligible, generally offered to
the other full-time employees or officers of Company,
including, as may be amended from time to time, all health,
medical and disability benefit plans of the Company. LW shall
be entitled
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to four weeks (20 business days) of paid vacation time for each
full calendar year that LW is employed by the Company.
3.3 Performance Reviews. On an annual basis, the Company shall
review LW's performance and shall make a determination as to
any increase in LW's base pay and an award of a bonus to LW in
the form of cash, restricted stock, stock options or other
consideration. The Company will make such determination based
on LW's performance and the financial results of the Company.
Except as hereinafter provided with respect to the guaranteed
bonuses, whether a pay increase and/or bonus are granted and
the amount and form of consideration for each shall be at the
sole and absolute discretion of the Company, as determined by
the Chairman or the Board of Directors of the Company, and such
determination shall be final and binding upon the parties
hereto. The Company shall pay LW a guaranteed cash bonus of
$5,000 on June 30, 1997, and $30,000 on June 30, 1998, as
further consideration for this Agreement and the non-compete
provisions contained in Section 4 hereof.
3.4 Stock Options. As additional consideration for entering into
this Agreement, Company shall grant and issue to LW 10,000
incentive stock options pursuant to the Company's 1996 Omnibus
Stock Option Plan, as amended (the "Plan"). The terms and
conditions and form of such option shall be as stated in the
form of option attached hereto as Exhibit A, and shall contain
an exercise price equal to the closing price of the Company's
common stock, as reported on the NASDAQ National Market System,
as of April 25, 1997.
4. Non-Compete Provisions.
4.1 Restrictive Covenants. LW agrees that during the period
beginning upon execution of this Agreement and ending one (1)
year after the date that LW ceases to be an employee of Company
for any reason (the "Restricted Period"), LW will not, without
the express written approval of the Company (i) solicit the
hire or employment of any person who is an employee of the
Company or any other affiliate or subsidiary of the Company at
the date of solicitation; (ii) act as employee, consultant,
shareholder, lender or agent of an entity which engages in any
such solicitation or (iii) directly or indirectly, manage, own,
operate, advise or join, control, or participate in the
ownership, management, operation or control of, or provide
services to or be employed by or connected with, in any manner,
any person engaged anywhere in the United States in the
equipment leasing or finance business or any other business
engaged in by the Company or any affiliate or subsidiary of the
Company as of the date LW ceases to be employed by Company.
Notwithstanding the foregoing, LW may invest in public
companies engaged in a competing business provided such
investment is passive and does not exceed 1% of the outstanding
stock of the public company.
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4.2 Reasonableness. LW acknowledges and agrees that the
restrictive covenants set forth in Section 4.1 (collectively,
the "Restrictive Covenants") are reasonable and valid in
geographical and temporal scope and in all other respects. If
any court determines that any of the Restrictive Covenants, or
any part thereof, is invalid or unenforceable, the remainder of
the Restrictive covenants shall not thereby be affected and
shall be given full force and effect, without regard to the
invalid or unenforceable parts. If any court determines that
any of the Restrictive Covenants, or any part thereof, is
invalid or unenforceable for any reason, such court shall have
the power to modify such Restrictive Covenants, or any part
thereof, and, in its modified form, such Restrictive Covenant
shall then be valid and enforceable.
4.3 Remedies and Survival. In the event of a breach by LW of any
of the Restrictive Covenants, LW acknowledges that the Company
will suffer substantial and irreparable damage and agrees
that the Company shall be entitled to a temporary restraining
order, preliminary injunction and/or a permanent injunction
restraining LW from continuing to breach any of said covenants
as well as other remedies permitted by applicable law. This
Section 4 shall survive termination of this Agreement and/or
LW's employment.
5. Confidentiality and Non-Disclosure Agreement. Concurrent with the
execution of this Agreement, LW shall enter into the Non-Disclosure
Agreement in the form attached hereto as Exhibit B.
6. Permanent Disability or Death. In the event LW shall fail during the
Employment Term, because of illness, physical or mental disability or
other incapacity for a period of two consecutive months, to render the
services provided for by this agreement ("Permanent Disability"), or in
the event of the death of LW, this Agreement shall terminate as of the
date of Permanent Disability or death, and the Company shall not have
any further obligations hereunder.
7. Discharge for Cause. Company shall have the right to terminate the
employment of LW for Cause. As used herein, the term "Cause" shall be
limited to:
i) A willful breach of duty by LW during the course of his
employment;
ii) Habitual neglect of duty by LW; or
iii) Disloyal, dishonest or illegal conduct of LW.
8. Disputes. Any dispute or controversy arising under or in connection
with this Agreement shall be finally settled exclusively by arbitration
in Denver, Colorado in accordance with the Rules of the American
Arbitration Association then in effect. Judgment may be entered on the
arbitrator's award in any court having jurisdiction.
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9. Severability. If any provision of this Agreement shall be declared to
be invalid or unenforceable, such invalidity or unenforceability shall
not affect the remaining provisions hereof which shall remain in full
force and effect.
10. Amendment. This Agreement can only be amended by a writing signed by
the party against whom such amendment is sought to be enforced.
11. Successors and Assigns. This Agreement shall inure to the benefit of
and be binding on the Company and its successors and assigns, and any
entity with which Company may merge or consolidate. Since LW's duties
and services hereunder are special, personal and unique in nature, LW
may not transfer, sell or otherwise assign his obligations under this
Agreement. No right or interest of LW under this Agreement shall be
assignable or transferable in any manner or be subject to alienation,
anticipation, sale, pledge, encumbrance or other legal process.
12. Expenses. In the case of any proceeding involving this Agreement to
which Company and the LW are adverse parties, the losing party shall
reimburse the prevailing party for all costs and expenses, including
attorneys' fees and disbursements, incurred by the prevailing party
in defense or prosecution of any such proceeding.
13. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Colorado, without giving
effect to any provision of Colorado law relating to the conflict of
laws.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
GRANITE FINANCIAL, INC.
By: Xxxxxxx X. Xxxxxx
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Title: Chairman & CEO
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XXXXX XXXXX
By: XXXXX X. XXXXX
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Xxxxx Xxxxx
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