EXHIBIT 10.2
EXHIBIT C-2
EMPLOYMENT AGREEMENT
AGREEMENT made as of this 1ST day of December, 2002, by and between
STRATUS SERVICES GROUP, INC. (referred to herein as "Employer" or "Company")
with a principal place of business at 000 Xxxxx Xxxx, Xxxxxxxxx, Xxx Xxxxxx
00000 and XXXXXXX XXXXXXXX ("Employee") residing at 00000 Xxxxxxxxxx Xxxx, Xxx
Xxxxxxx, Xxxxxxxxxx 00000.
NOW, THEREFORE, in consideration of the foregoing, and intending to be
legally bound, the parties mutually agree as follows:
1. EMPLOYMENT
Employer agrees to employ Employee, and Employee hereby accepts such
employment. The Employee shall serve as a REGIONAL VICE PRESIDENT. However,
the Employee may serve in such positions, undertake such duties and have
such authority as the Company shall assign to the Employee in its sole and
absolute discretion. The Company has the right to change the nature, amount
or level of authority and responsibility assigned to the Employee at any
time, with or without cause. The Company may also change the title or titles
assigned to the Employee at any time, with or without cause. Except as
otherwise provided herein the Employee agrees to devote substantially all of
his working time and efforts to the business and affairs of the Company. The
Employee further agrees that he shall not undertake any outside activities
which create a conflict of interest with his duties to the Company, or
which, in the judgment of the Board of Directors of the Company, interfere
with the performance of the Employee's duties to the Company. Anything to
the contrary notwithstanding, (a) Employee shall not be required to relocate
as a condition of employment, (b) Employee's duties and responsibilities
shall not be increased without his prior written consent, and (c) Employee
shall be permitted to work principally from his home.
2. DUTY OF LOYALTY
Employer and employee agree to give each other thirty days notice of
their intent to terminate this Agreement and their employment relationship.
The parties agree that after the Initial Term (as defined in Section 3),
this will be an at-will relationship, which means that either of them can
terminate the employment relationship at any time for any lawful reason.
Employer agrees that (a) Employee shall continue to own and operate
Elite Personnel Services, Inc. ("Elite"), which is in the process of selling
its business and assets; (b) Employee may engage in activities relating to
the collection of accounts receivable of Elite from persons who may be
customers of Employer's; (c) Elite intends to sell its business located at
its Montebello and Glendale, California offices to U.S. Temp which will
continue to operate such business with the assistance of Employee; and
(d) Employee's activities relating to subsections (a), (b) and (c) shall not
be deemed to cause a breach of any of the terms of this Agreement.
3. TERM.
This agreement shall commence as of the date stated above and shall
continue until terminated in accordance with the provisions of this
Agreement. The "Initial Term" of this Agreement shall be the one year period
from the date hereof, or, if "Gross Profits" (as defined below) exceed
$2,500,000 for the first year of this Agreement, the Initial Term shall be
the two year period from the date hereof. For purposes hereof only and not
for purposes of determining the deferred purchase price as set forth in
Section 1.2(b) of the Asset Purchase Agreement dated November 19, 2002,
between Employer and Elite, "Gross Profits" shall be calculated in the
manner set forth in Section 1.2(b) and Schedule 1.2(b) of such Asset
Purchase Agreement, except that the amount of worker's compensation
insurance premium deducted from gross revenues shall not exceed 10% of such
gross revenues. Employer may terminate this Agreement during the Initial
Term only for "cause" as defined in Section 4(d) hereof. Employee may
terminate this Agreement at any time with or without cause.
4. GROUNDS FOR TERMINATION.
The Employee's employment may be terminated on any of the following grounds:
(a) WITHOUT CAUSE. The Employee, at any time, or the Company, after
the Initial Term, may terminate the Employee's employment, without
cause, by giving the other party to this Agreement at least 30
days advance written notice of such termination.
(b) DEATH. The Employee's employment hereunder shall terminate upon
his death.
(c) DISABILITY. If, as a result of the Employee's incapacity due to
physical or mental illness, the Employee shall have been unable to
perform the essential functions of his position, even with
reasonable accommodation that does not impose an undue hardship on
the Company, on a full-time basis for the entire period of six (6)
consecutive months, and within thirty (30) days after written
notice of termination is given (which may occur before or after
the end of such six month period), shall not have returned to the
performance of his duties hereunder on a full-time basis (a
"disability"), the Company may terminate the Employee's employment
hereunder.
(d) CAUSE. The Company may terminate the Employee's employment
hereunder for cause. For purposes of this Agreement, "cause" shall
mean that the Company, acting in good faith based upon the
information then known to the Company, determines that the
Employee has engaged in or committed: willful misconduct; theft,
fraud or other illegal conduct which adversely affects Employer;
refusal or unwillingness to substantially perform his duties
(other than such failure resulting from the Employee's disability)
for thirty (30) days after written demand for substantial
performance is delivered by the Company that specifically
identifies that manner in which the Company believes the Employee
has not substantially performed his duties; any willful act that
is likely to have the effect of injuring the reputation or
business of the Company; violation of any fiduciary duty;
violation of the Employee's duty of loyalty to the Company; or a
material breach of any term of this Agreement which has not been
cured within 30 days after written notice from Employer which
specifically describes such breach. For purposes of this Section
4(d), no act, or failure to act, on the Employee's part shall be
considered willful unless done or omitted to be done, by him not
in good faith and without reasonable belief that his action or
omission was in the best interest of the Company.
5. EMPLOYEE WARRANTIES
Employee warrants that he is free to enter into the terms of this
Agreement and that he has no obligations inconsistent with unrestrained
employment for Employer. Employee further agrees that during this
employment, he shall devote substantially all of his working time and
attention to the business of the Employer. Employee shall not prepare for,
undertake or discuss with other employees of Employer any business or
professional employment of any kind which is competitive with Employer.
6. COMPENSATION AND BENEFITS
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Attached hereto and incorporated herein as Exhibit A.
7. CONFIDENTIALITY AND TRADE SECRETS
Employee acknowledges that the manuals, methods, forms, techniques
and systems which Employer owns, plans or develops, whether for its own use
or for use by or with its clients, are confidential trade secrets and are
the property of Employer.
Employee further acknowledges that he will obtain access to
confidential information concerning Employer's clients, including their
business affairs, special needs, preferred methods of doing business,
methods of operation, key contact personnel and other data, all of which
provides Employer with a competitive advantage and none of which is readily
available except to employees of Employer.
Employee further acknowledges that he will obtain access to the
names, addresses, telephone numbers, qualifications, education,
accomplishments, experience, availability, resumes and other data regarding
persons who have applied or been recruited for temporary or permanent
employment by Employer, as well as job order specifications and the
particular characteristics and requirements of persons generally hired by a
client, specific job listings, mailing lists, computer runoffs, financial
and other information, all of which provides Employer with a competitive
advantage and none of which is readily available except to employees of
Employer.
Employee agrees that all of the foregoing information regarding
Employer's methods, clients and employees constitutes valuable and
proprietary trade secrets and confidential information of Employer
(hereafter "Confidential Information").
8. NON-DISCLOSURE AGREEMENT
Employee agrees that except as directed by Employer, the Employee
will not at any time, whether during or after his employment with the
Employer, use for any reason or disclose to any person any of the Employer's
Confidential Information or permit any person to examine and/or make copies
of any documents which may contain or are derived from Confidential
Information, whether prepared by the Employee or otherwise, without the
prior written permission of Employer.
9. AGREEMENT NOT TO COMPETE FOR ACCOUNTS OR PERSONNEL
Employee agrees that during his employment with Employer and/or the
three (3) years after such employment ends, he will not, directly or
indirectly, contact, solicit, divert, take away or attempt to contact,
solicit, divert or take away any staff employee, temporary personnel,
customer, account, business or goodwill from Employer, either for Employee's
own benefit some other person or entity, and will not aid or assist any
other person or entity to engage in any such activities.
10. RETURN OF RECORDS AND PAPERS
Upon the termination of his employment with Employer for any reason
whatsoever, Employee agrees to return to an officer of Employer all manuals,
records, documents, files and papers pertaining to Employer's business,
methods, clients, employees or operations. In the event Employee fails to do
so, or in the event Employee shall violate any covenant of this Agreement,
Employee agrees to and does waive and forfeit all claims to unpaid
compensation, commissions or severance pay, without affecting the right of
Employer to compel the return of said records and papers or Employer's right
to enforce any covenant of this Agreement.
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Employee agrees that he has no proprietary interest in any documents
or work product developed or used by Employee which in any way arises out of
his employment by Employer. Employee shall from time to time, as requested
by Employer, do all things which may be necessary to establish or document
Employer's ownership of any such work product, including, but not limited
to, execution of appropriate copyright applications or assignments.
11. INJUNCTIVE RELIEF
Employee recognizes that irreparable damage will result to Employer
in the event he violates any covenant contained herein, and agrees that in
the event of such violation Employer shall be entitled, in addition to its
other legal or equitable remedies and damages, to temporary and permanent
injunctive relief to restrain such violation(s) by Employee, without the
need to post any injunction bond.
12. LEGAL FEES
In the event that legal proceedings are commenced by any party
hereto against any other party hereto in connection with this Agreement or
the transactions contemplated hereby, the party which does not prevail in
such proceedings shall pay the reasonable attorney's fees and costs incurred
by the prevailing party in such proceedings.
13. INTERPRETATION OF AGREEMENT
Any provision or clause hereof which may be invalidated as
prohibited by law shall be ineffective to the extent of such illegality;
however, this shall in no way affect the remaining provisions of this
Agreement, and this Agreement shall be interpreted as if such clause or
provision were not contained herein.
14. ASSIGNMENT
Employer may assign this Agreement and Employer's rights hereunder,
to a successor or to an affiliated company, provided, however, that any such
successor or affiliated company shall expressly agree to be subject to and
bound by the terms of this Agreement.
15. UNDERSTANDING OF PARTIES
This Agreement represents the entire Agreement between the parties
and supersedes any and all prior agreements or understandings, oral or
written, between Employee and Employer pertaining to the subject matter
covered by this Agreement. This Agreement shall not be changed or terminated
orally, and no alleged change, termination or attempted waiver of any of the
provisions hereof shall be binding unless set forth in a writing signed by
both parties hereto. Employee agrees that this Agreement shall remain in
full force and effect notwithstanding any permitted changes in job title,
job assignment, position or salary. Employee acknowledges that the covenants
and conditions of this Agreement are reasonable and necessary for the
protection of Employer's business, and that Employee will be able to work
and earn a living in the staffing industry even if this Agreement is fully
enforced against him/her.
16. MISCELLANEOUS
A. All references to he, his or other masculine derivatives in this
Agreement shall include she, hers and other feminine derivatives as
appropriate.
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B. Employee agrees and acknowledges that a violation of paragraphs 7
through 10 hereof, will be deemed to constitute gross misconduct within the
meaning of the Consolidated Omnibus Budget Reconciliation Act ("COBRA") and,
therefore, will result in Employee's ineligibility for continued coverage or
medical benefits through Employer's group plans.
C. This Agreement shall be interpreted and construed according to
the laws of the State of New Jersey. In the event of an action by either
party alleging a violation of this Agreement, the parties hereto agree to
service of process by mail.
D. The waiver by Employer of a breach of any provision of this
Agreement by Employee shall not operate or be construed as a waiver of any
continuing or subsequent breach by Employee or as a waiver by Employer of
any past, present or future right granted under this Agreement.
E. Employee agrees that he will advise any prospective employer of
the covenants and restrictions of this Agreement before accepting any offer
from another employer.
F. By signing below, Employee acknowledges receiving a copy of this
Agreement. Employee acknowledges and agrees that he is entering into this
Agreement voluntarily and of his own free will in order to obtain the
benefits of employment and continued employment by Employer. Employee
acknowledges and agrees that he has not been coerced or suffered any duress
in order to induce him to enter into this Agreement.
G.
Any notices or other communication required or permitted hereunder shall be in
writing and shall be sufficiently given if delivered personally or sent by
facsimile (with transmission confirmed), Federal Express, registered or
certified mail, return receipt requested, postage prepaid, addressed as follows
or to such other address or facsimile number of which the parties may have given
notice:
TO THE SELLER:
Xx. Xxxxxxx Xxxxxxxx
Chief Executive Officer
00000 Xxxxxxxxxx Xx.
Xxx Xxxxxxx, XX 00000
TO THE BUYER: WITH A COPY TO:
Xx. Xxxxxx X. Xxxxxxx Xxxxxxx Xxxxxxx Xxxxxxx, Esq.
President & CEO General Counsel
Stratus Services Group, Inc. Stratus Services Group, Inc.
000 Xxxxx Xxxx, Xxxxx 000 000 Xxxxx Xxxx, Xxxxx 000
Xxxxxxxxx, XX 00000 Xxxxxxxxx, XX 00000
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Unless otherwise specified herein, such notices or other communications shall be
deemed received (a) on the date delivered, if delivered personally, by facsimile
or by Federal Express; or (b) three business days after being sent, if sent by
registered or certified mail.
IN WITNESS HEREOF, the undersigned have hereunto set their hands as of
the date first above written.
Employer: Employee:
By: /s/ Xxxxxx X. Xxxxxxx /s/ Xxxxxxx Xxxxxxxx
----------------------------------- -----------------------------------
Name: Xxxxxx X. Xxxxxxx Xxxxxxx Xxxxxxxx
Title: President and CEO
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EXHIBIT A
SALARY AND BONUSES. The Employee's base salary shall be $100,000.00 per
annum earned and payable bi-weekly.
EXPENSES. During the term of the Employee's employment, the Employee
shall be entitled to receive reimbursement for all reasonable and customary
expenses incurred by the Employee in performing services for the Company in
accordance with the Company's reimbursement policies as they may be in effect
from time to time. In addition, Employee will be entitled to a monthly expense
allowance of $5,000.00.
BENEFITS. The Employee shall be entitled to participate in all employee
benefit plans, programs and arrangements of the Company (including, without
limitation or agreements and health benefits, insurance, retirement (401K) and
vacation plans, programs and arrangements), in accordance with the terms of such
plans, programs or arrangements in effect during the period of the Employee's
employment and at levels commensurate with other employees in comparable
positions. In addition, the Employee shall abide by and be entitled to the same
holiday and sick pay policy as is in effect for the corporate staff of the
Company. The parties to this Agreement recognize that the Company may terminate
or modify such plans, programs or arrangements at any time.
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