EMPLOYMENT AND NON-COMPETE AGREEMENT
This Agreement is entered into this 17th day of July, 1999 by and
between XXXXX COMPANIES, INC., a Delaware Corporation ("Xxxxx") and
Xxxxxx Xxxxxx ("Employee").
Whereas Employee has certain knowledge and skills in the freight
forwarding/customs brokerage business and wishes to be employed by Xxxxx; and
Whereas Xxxxx desires to employ Employee in its business;
Whereas, Xxxxx and Employee in consideration of the covenants contained
herein agree as follows:
1. Xxxxx shall employ Employee as of August 16, 1999 in the position of
Executive Vice President-Engineering, which is an executive officer
position subject to confirmation by the Board of Directors of Xxxxx,
reporting to the Office of the Chairman (or its successor).
2. Xxxxx shall compensate Employee for such employment as follows:
a. Sixteen Thousand Six Hundred Sixty-Six Dollars and Sixty-Seven Cents
($16,666.67) gross salary per month;
b. Three weeks vacation per year,
c. Participation in the Performance Based Retention Plan with
a target of 100% of base salary. During the first year of
the term hereof, Employee's award under the Performance
Based Retention Program shall be 100% of his base salary
(subject to the standard vesting provisions of the
Performance Based Retention Plan);
d. A one-time award of twenty-five thousand (25,000)
non-qualified options for Xxxxx common stock with an
exercise price equal to the closing price of Xxxxx common
stock on the NASDAQ National Market on July 2, 1999 and
subject to the execution of and terms and conditions of
Xxxxx'x standard Non-Qualified Options Agreement. All such
options shall vest one-third at the completion of one year
of employment hereunder, one-third at the completion of
two years of employment hereunder and one-third at the
completion of three years of employment hereunder.
e. A one-time award on the first day of employment hereunder
of ten thousand (10,000) shares of restricted Xxxxx common
stock. Such stock shall vest 3,333 shares immediately upon
grant,3,334 shares one year from the date of grant and
3,333 shares two years from the date of grant so long as
Employee is continuously employed by Xxxxx from the grant
date through the vesting date and subject to the terms and
conditions of the standard Xxxxx Restricted Stock
Agreement.
f. Fringe Benefits as provided to all Xxxxx employees of the same salary
level.
g. Should Employee be required, at any time during the term
of this agreement, to relocate to another location from
his then current residence, Xxxxx shall reimburse Employee
for all reasonable costs incurred by Employee in the sale
of his then current residence, the purchase of a new
residence in the relocated location and the cost of the
physical move to the new location.
h. Six months' temporary housing in the Company apartment in
San Francisco, California commencing August 1, 1999.
i. In the event that the Company elects not to offer Employee
continued employment beyond the expiration date of this
Agreement, all stock options and restricted stock awarded
to Employee during the term of this Agreement (including
those awarded under the Performance Based Retention Plan),
which has not yet vested as of the expiration of this
Agreement, shall vest as of the last date of this
Agreement.
3. This Agreement shall have a term of five (5) years expiring on
August 1, 2004. All terms herein shall remain unchanged for
the duration of the term of this Agreement unless changed
or modified by a written document signed by Employee and the
Office of the Chairman of Xxxxx.
4. Either party may terminate this Agreement with no further liability
or obligations hereunder for any gross misconduct, criminal act or
material breach of contract by the other party.
5. Xxxxx may terminate this agreement with no further liability or
obligation hereunder should Employee materially fail to meet the
mutually agreed upon performance standards agreed to at the
commencement of each fiscal year.
6. Employee shall not engage in any activity whatsoever which conflicts
with the interests of Xxxxx or with Employee's duties as an employee
of Xxxxx. Employee understands that Employee's employment is on a
full-time basis, and Employee agrees not to engage in any other
employment of business-related activity without the prior written
consent of an officer of Xxxxx. Employee hereby represents that
Employee has no agreements with, or obligations to, any person or
entity which conflicts, or may conflict, with the interests of Xxxxx
or with Employee's duties as an employee of Xxxxx.
7. Employee understands and acknowledges that during Employee's employment
with Xxxxx, Employee has been and shall be exposed to Confidential
Information (defined below), all of which is proprietary and which
rightfully belongs to Xxxxx. Employee shall hold in a fiduciary
capacity for the benefit of Xxxxx all such Confidential Information
obtained by Employee during Employee's employment with Xxxxx and shall
not, directly or indirectly, at any time, either during or after
Employee's employment with Xxxxx, without Xxxxx'x prior written
consent, use any of such Confidential Information or disclose any
of such Confidential Information to any individual or entity other than
authorized employees of Xxxxx except as required in the performance of
Employee's duties for Xxxxx. Employee shall take all reasonable steps
to safeguard such Confidential Information and to protect such
Confidential Information against disclosure, misuse, loss or theft.
The term "Confidential Information" shall mean any information not
generally known in the relevant trade or industry, which was obtained
from Xxxxx or which was learned, discovered, developed, conceived,
originated or prepared during or as a result of the performance of any
services by Employee as an employee of Xxxxx or on behalf of Xxxxx,
including, without limitation, information concerning the provision of
freight forwarding services such as the cost of such services, price
lists, marketing programs or plans, lists of customers, potential
customers, dealers and contacts and other compilations of Confidential
Information.
8. In consideration of the restricted stock grant provided for in
subpart 2.e. above, upon termination of Employee's employment
(regardless of cause), for a period of these (3) months
thereafter ("Non-Competition Period"), the following shall
apply:
a. During the term hereof and for the Non-Competition Period after
Employee ceased to be employed by Xxxxx, Employee shall not, directly
or indirectly, either of himself or any other person, own, manage,
control, participate in, invest in, permit his name to be used by, act
as consultant or advisor to, render services for (whether alone or in
association with any individual, entity, or other business
organization), or otherwise assist in any manner any individual or
entity that engages in or owns, invests in, manages or controls any
venture for enterprise engaged in the provision of services that are
similar to, or in competition with, or many materially detract from,
any services provided by Xxxxx or as to which Xxxxx had firm plans as
of the date Employee ceased to be employed by Xxxxx. Nothing herein
shall prohibit Employee from being a passive owner of not more than
two percent (2%) of the outstanding stock of any class of securities
of a corporation engaged in such business which is publicly traded, so
long as he has no active participation in the business of such
corporation.
b. During the Non-Competition Period, Employee shall not,
directly or indirectly,(i) induce or attempt to induce or
aid another in inducing any employee of Xxxxx to leave the
employ of Xxxxx, or in any way interfere with the
relationship between Xxxxx and any employee of Xxxxx, or
(ii) induce or attempt to induce any customer of Xxxxx to
cease doing business with Xxxxx, or in any way interfere
with the relationship between Xxxxx and any customer or
other business relation of Xxxxx.
c. During the Non-Competition Period, Employee shall not,
directly or indirectly employ any employee of Xxxxx who
voluntarily terminates such employment until three months
have passed following termination of such employment.
d. In the event a court shall refuse to enforce the agreements
contained herein, either because of the scope of the
geographical area specified in the Agreement or the
duration of the restrictions, the parties hereto expressly
confirm their intention that the geographical areas covered
hereby and the time period of the restrictions be deemed
automatically reduced to the minimum extent necessary to
permit enforcement.
9. Each of the parties hereto acknowledges and agrees that the extent
of damages to Xxxxx in the event of a breach by Employee of this
Agreement would be impossible to ascertain and there is and will
be available to Xxxxx no adequate remedy at law to compensate it
in the event of such breach. Consequently, Employee agrees that,
in the event that he breaches any of such covenants, Xxxxx shall
be entitled, in addition to any other relief to which it may be
entitled including without limitation money damages, to enforce
any or all of such covenants by injunctive or other equitable
relief ordered by any court of competent jurisdiction.
10. In the event that Xxxxx terminates the employment of Employee
hereunder, other than for cause, Employee's sole remedy for such
termination shall be:
a. Thirty days' notice of such termination (or pay in lieu thereof); and
b. Nine (9) months salary at Employee's base salary as of the
date of termination. In the event that Xxxxx is acquired by
Ryder Systems, Inc. or any of its subsidiaries, and either
Employee resigns thereupon or is terminated, other than for
cause, during the term hereof, such termination payments
shall be increased by three (3) months' additional salary,
and
c. All restricted stock and stock options (including those
awarded under the Performance Based Retention Plan) granted
to Employee which are not yet vested as of the date of
termination shall immediately vest as of such date.
11. To ensure rapid and economical resolution of any disputes which may arise
under this Agreement, Employee and Xxxxx agree that any and all
disputes or controversies of any nature whatsoever, regarding the
interpretation, performance, enforcement of breach of this
Agreement shall be resolved by confidential, final and binding
arbitration (rather than by trial by jury or court or resolution
in some other forum), to the fullest extent permitted by law, by
Judicial Arbitration and Mediation Services ("JAMS") in San
Francisco, California under the then-existing JAMS rules. In the
event JAMS no longer exists at such time, such arbitration shall
be conducted in San Francisco, California by the American
Arbitration Association under their then-existing rules. The
prevailing party in the arbitration shall be entitled to recover
his or its attorney's fees. Nothing in the paragraph is intended
to prevent either party from obtaining injunctive relief in court
to prevent irreparable harm pending the conclusion of any such
arbitration.
12. This Agreement shall be governed by and construed in accordance with the
laws of the State of California.
XXXXX COMPANIES, INC. /s/XXXXXX XXXXXX
By: /s/ Xxxx X. Xxxxx
Title: Office of the Chairman
