EXHIBIT 10.1
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made as of the 1st day of September, 2003, by and between
XRG Logistics, a Florida corporation having its principal office located at 0000
X. Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxx, Xxxxxxx 00000 (hereinafter "XRGL"), and
Xxxxxxx Xxxxxxx, an individual residing in XxXxxx County, Tennessee (hereinafter
"Executive").
Witnesseth:
Concurrently with the execution and delivery of this Agreement, XRG, Inc.,
a Delaware corporation and the parent corporation of XRGL ("XRG"), is purchasing
the stock of XRG Logistics, Inc., a Florida corporation ("Stock Purchase"). Upon
the consummation of the Stock Purchase, XRGL desires to employ the Executive,
and the Executive wishes to accept such employment with XRGL, upon the terms and
conditions set forth in this Agreement.
Accordingly, in consideration of the foregoing and the respective covenants
of the parties set forth herein, the parties, intending to be legally bound,
agree as follows:
1. Employment. XRGL hereby employs the Executive and the Executive hereby
accepts employment by XRGL upon the terms and conditions hereinafter set forth.
All previous employment agreements or other terms and conditions of employment
between any other entity and the Executive are hereby terminated and are
superseded by this Agreement.
2. Term. Subject to the provisions of Paragraph 11 hereof, the term of the
Executive's employment by XRGL under this Agreement shall commence on the date
hereof and shall continue for a term of five (5) years ("Original Term").
Expiration of the Original Term shall not prevent XRGL from continuing the
Executive's employment beyond such expiration on such terms as may be mutually
satisfactory to XRGL and the Executive. The term of the Executive's employment
hereunder, including any extension beyond the Original Term, is hereinafter
referred to as the "Employment Period. "
3. Duties. The Executive shall be employed as the President of XRGL and
shall have such duties as are assigned or delegated to him from time to time by
the Board of Directors of XRGL. The Executive shall devote such time and
attention during normal business hours to the business of XRGL as determined by
the Board of Directors of XRGL. Nothing herein, however, shall prevent the
Executive from engaging in additional activities in connection with personal
investments and community affairs that do not interfere or conflict with his
duties hereunder.
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4. Base Compensation. The Executive shall be paid a salary at an annual
rate of $96,000 during the Original Term, which shall be payable in installments
in accordance with XRGL's customary payroll practices, but no less frequently
than monthly. The salary to be paid during any extension of the Employment
Period beyond the Original Term will be as agreed to by XRGL and the Executive.
5. Quarterly Bonus. The Executive shall be entitled to participate in a
quarterly bonus program. The quarterly bonus program is described in Exhibit A.
6. Stock. At the closing of the Stock Purchase, XRG will issue 50,000
shares of XRG common stock to the Executive. The Executive will be entitled to
an additional 50,000 shares of XRG stock at the one-year anniversary of his
employment. In addition, the Executive will be entitled to a bonus of 50,000
shares of XRG stock if XRGL of which the Executive is President, during the
first year of his contract, exceeds gross revenue of $20 million with operating
costs, as described in Exhibit A "The quarterly bonus program", not exceeding
85% of gross revenue.
7. Automobile Expense Allowance. During the Employment Period, XRGL shall
pay to the Executive an automobile expense allowance of $500 per month, which
shall be paid to Executive on the first business day of each month. This amount
covers automobile purchase or lease payments and automobile insurance payments.
8. Expenses. Subject to compliance by the Executive with such policies
regarding expenses and expense reimbursement as may be adopted from time to time
by XRGL, the Executive is authorized to incur reasonable expenses in the
performance of his duties hereunder in furtherance of the business and affairs
of XRGL and XRGL will reimburse the Executive for all such reasonable expenses,
in all cases upon the presentation by the Executive of an itemized account
satisfactory to XRGL in substantiation of such expenses.
9. Vacations. The Executive shall be entitled to paid vacations in
accordance with the policies of XRGL in effect, from time to time, as determined
by the Board of Directors of XRGL; but in any event, Executive shall be entitled
to not less than one (1) week per year of paid vacation.
10. Other Employee Benefits. The Executive shall, during the Employment
Period, be eligible to participate in such pension, profit sharing, bonus, life
insurance, hospitalization and medical and other employee benefit plans of XRGL
which may be in effect from time to time to the extent he is eligible under the
terms of those plans; provided, however, that the allocation of benefits under
any bonus or other plan which provides that allocations thereunder shall be in
the discretion of the Board of Directors of XRGL shall be as determined from
time to time solely by the Board of Directors; but in any event, Executive shall
be entitled to not less than group insurance with PPO plan.
11. Termination.
(a) The Employment Period, the Executive's compensation and any and all
other rights of the Executive under this Agreement or otherwise as an employee
of XRGL shall terminate (except as to compensation and rights accrued prior to
the effective date of such termination): (i) upon the death of the Executive;
(ii) upon fourteen (14) days prior written notice by XRGL to Executive in the
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event of the physical or mental disability of the Executive (as defined in
Paragraph 11(b) below); (iii) for Cause (as defined in Paragraph 11(c) below),
immediately upon the giving of written notice thereof by XRGL to the Executive,
or at such later time as such notice may specify; or (iv) without Cause at any
time after the initial one-year term hereof, upon not less than sixty (60) days'
prior written notice by either the Executive or XRGL to the other party and
subject to Paragraph 11(d) below.
(b) For purposes of this Agreement, the Executive shall be deemed to have a
"physical or mental disability" if for medical reasons he has been unable to
perform his duties for thirty (30) consecutive days or ninety (90) days in any
12-month period, all as determined in good faith by a physician mutually
acceptable to Executive and the Board of Directors of XRGL.
(c) For purposes of this Agreement, the term "Cause" shall be deemed to
mean the Executive's conviction of any crime, the Executive's commission of any
act of willful misconduct or dishonesty, or the material breach of any provision
of this Agreement by the Executive.
(d) In the event the Employment Period is terminated by XRGL for any reason
other than for Cause or for the death or the physical or mental disability of
the Executive, XRGL shall pay to the Executive, as XRGL's sole and exclusive
obligation related to such termination, the compensation and annual bonuses
provided for in this Agreement for the remainder of the Original Term. The
Executive shall also be entitled to a continuation of medical and life insurance
benefits, on the same terms and conditions as existed immediately prior to such
termination, for the remainder of the Original Term.
(e) Executive may terminate his employment for good reason. For purposes of
this Agreement, "good reason" shall mean a failure by XRGL to comply with any
material provision of this Agreement, which failure is not cured within fourteen
(14) days after a written notice of noncompliance has been given by Executive to
XRGL, provided that the foregoing notice and cure provisions shall not apply to
any failure by XRGL to comply with its payment obligations hereunder.
12. Non-Disclosure Covenant. The Executive acknowledges that (i) during the
Employment Period and as a part of his employment, the Executive will be
afforded access to Confidential Information (as hereinafter defined); (ii)
public disclosure of Confidential Information could have a material adverse
impact on XRG, on XRGL or on the other subsidiaries of XRG (hereinafter "XRG
Companies") and their respective businesses; (iii) the Executive possesses
substantial technical expertise and skill with respect to the business of the
XRG Companies; and (iv) XRG has required the Executive to make the covenants set
forth in this Section 12 as a condition to its purchase of the stock of XRG
Logistics, Inc. and the Executive is willing to do so. The Executive
acknowledges that the provisions of this Section 12 are reasonable and necessary
with respect to the use of Confidential Information.
As used in this Agreement, the term "Confidential Information" shall mean
inventions and improvements, ideas, plans, processes, techniques, technology,
customer lists, business methods, trade secrets as defined under applicable law,
and other information developed or acquired by or on behalf of the XRG Companies
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which relate to or affect any aspect of the business of the XRG Companies.
Confidential Information shall not include information that becomes generally
known to the public through no act of Executive in breach of this Agreement
In consideration of the foregoing and of continued employment of the
Executive by XRGL and the compensation and benefits paid or provided, and to be
paid or provided, to the Executive by XRGL, the Executive hereby covenants and
agrees as follows:
Both during and after the Employment Period, the Executive shall not,
without XRGL's prior written consent, disclose to any third party, or use for
any purpose other than for the exclusive benefit of the XRG Companies, any
Confidential Information.
The Executive agrees that disclosures made by the XRG Companies to
governmental authorities, to their customers or potential customers, to their
suppliers or potential suppliers, to their employees or potential employees, to
their consultants or potential consultants or disclosures made by the XRG
Companies in any litigation or administrative or governmental proceedings shall
not mean that the matters so disclosed are available to the general public.
The Executive shall not remove from the premises of the XRG Companies,
except when appropriate to the pursuit of their business, any document, record,
notebook, plan, model, component, or device. The Executive recognizes that, as
between the XRG Companies and the Executive, all such documents, records,
notebooks, plans, models, components or devices, whether or not developed by the
Executive, are the exclusive property of the XRG Companies. In the event of
termination of the Executive's employment with XRGL, or upon the earlier request
of any of the XRG Companies during the Employment Period, the Executive shall
return to the XRG Companies all documents, records, notebooks, plans, models,
components, and devices in the Executive's possession or subject to the
Executive's control. The Executive shall not retain any copies, abstracts,
sketches or other physical embodiment of any such document, record, notebook,
plan, model, component or device.
13. Covenant Not to Compete; Non-Interference.
(a) The Executive acknowledges that the services to be performed under this
Agreement are of a special and unique character, that the businesses of the XRG
Companies are national in scope, that their services are marketed throughout the
United States, and that the XRG Companies compete with other organizations that
are or could be located in any part of the United States. The Executive further
acknowledges that XRG requires the Executive to agree to the provisions of this
Section 13 as a condition to its purchase of the stock of XRG Logistics, Inc. In
consideration of the foregoing, and in consideration of his continued employment
by XRGL, the Executive hereby covenants and agrees that he shall not:
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(i) during the Employment Period, and for a period of five (5) years
thereafter, directly or indirectly engage or invest in, own, manage, operate,
control or participate in the ownership, management, operation or control of, be
employed, associated or in any manner connected with, or render services or
advice to, any business whose services or activities compete, in whole or in
part, with the services or activities of the XRG Companies within the
geographical territories within the United States in which the XRG Companies at
any time during the Employment Period conduct their respective businesses;
(ii) whether for the Executive's own account or for the account of any
other person, at any time during the Employment Period, and for a period of five
(5) years thereafter, solicit the business of any person or entity known by the
Executive to be a customer of the XRG Companies, whether or not the Executive
had personal contact with such person or entity during his employment with XRGL;
and
(iii) whether for the Executive's own account or the account of any other
person at any time during the Employment Period and for a period of five (5)
years thereafter, solicit, employ or otherwise engage as an employee,
independent contractor or otherwise, any person who is or was an employee of any
of the XRG Companies during the Executive's Employment Period, or in any manner
induce or attempt to induce any employee of any of the XRG Companies to
terminate his/her employment with such company.
It is understood by and between the parties hereto that the foregoing
covenants by the Executive set forth in this Section 13 are essential elements
of this Agreement and that but for the agreement of the Executive to comply with
such covenants, XRGL would not have entered into this Agreement. XRGL and the
Executive have independently consulted their respective counsel and have been
advised in all respects concerning the reasonableness and propriety of such
covenants, with specific regard to the nature of the businesses conducted by the
XRG Companies.
(b) Notwithstanding any provision of this Agreement to the contrary, the
restrictions set forth in Section 13(a) hereof shall not apply in the event that
XRGL terminates the Employment Period during the Original Term for any reason
other than for Cause or the physical or mental disability of the Executive.
(c) Notwithstanding that the Executive's employment hereunder may expire or
be terminated as provided in Section 11 hereof, this Agreement shall continue in
full force and effect insofar as is necessary to enforce the covenants and
agreements of the Executive contained in Section 13.
14. Injunctive Relief. The Executive acknowledges that the damages that
would be suffered by the XRG Companies as a result of a breach of the provisions
of Section 12 or 13 of this Agreement may not be calculable, and that an award
of a monetary judgment to any of the XRG Companies for such a breach would be an
inadequate remedy. Consequently, any of the XRG Companies shall have the right,
in addition to any other rights it may have, to obtain, in any court of
competent jurisdiction, injunctive relief to restrain any breach or threatened
breach hereof or otherwise to specifically enforce any of the provisions of this
Agreement and such company shall not be obligated to post bond or other security
in seeking such relief.
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15. Definition of "person." The term "person" shall mean any individual,
corporation, firm, association, partnership, limited liability company or other
legal entity or other form of business organization.
16. Compliance with Other Agreements. The Executive represents and warrants
that the execution and delivery by the Executive of this Agreement and the
performance by the Executive of his obligations hereunder will not, with or
without the giving of notice or the passage of time, or both, (i) violate any
judgment, writ, injunction or order of any court, arbitrator or governmental
agency applicable to the Executive; or (ii) conflict with, result in the breach
of any provisions of or the termination of, or constitute a default under, any
agreement to which the Executive is a party or by which he is or may be bound.
17. Waiver of Breach. The waiver by any party hereto of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach.
18. Binding Effect; Benefits. This Agreement shall inure to the benefit of,
and shall be binding upon, the parties hereto and their respective successors,
assigns, heirs and legal representatives, including, without limitation, any
entity with which XRGL may merge or consolidate or to which it may transfer all
or substantially all of its assets. Insofar as the Executive is concerned, this
Agreement, being personal, may not be assigned.
19. Notices. All notices and other communications which are required or may
be given under this Agreement shall be in writing and shall be deemed to have
been duly given when delivered in person or three (3) days after being mailed by
registered or certified first class mail, postage prepaid.
20. Entire Agreement; Amendments. This Agreement contains the entire
agreement of the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings, oral or written, between the
parties hereto with respect to the subject matter hereof. This Agreement may not
be changed orally, but only by an agreement in writing signed by the party
against whom any waiver, change, amendment, modification or discharge is sought.
21. Severability. If any provision or provisions of this Agreement shall be
declared invalid or unenforceable, any such provision or provisions shall be
deemed severed from the remainder of the provisions contained herein which shall
otherwise remain in full force and effect.
22. Governing Law; Consent to Jurisdiction. This Agreement shall be
governed by and construed in accordance with the laws of the State of Florida
without giving effect to the principles of conflicts of law thereof. The
Executive hereby submits to the jurisdiction and venue of the Circuit Court of
the State of Florida for the County of Hillsborough or the United States
District Court for the Middle District of Florida, Tampa Division, for purposes
of any legal action related hereto. The Executive agrees that service upon him
in any such action may be made by first class mail, certified or registered.
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23. Dispute Resolution. Any dispute, controversy or claim arising out of or
relating to this Agreement (except for matters covered by Section 14 hereof)
shall be settled by arbitration by the American Arbitration Association ("AAA")
in accordance with the then current rules in effect governing arbitration of
such matters. The arbitration shall be conducted in Tampa, Florida by three (3)
independent and impartial arbitrators. The award rendered by the arbitrators
shall be final and a judgment may be entered upon it according to applicable law
in any court having jurisdiction. The arbitrators shall, in the award, allocate
the costs and expenses of the arbitration, including AAA fees and expenses,
arbitrator compensation and expenses, the cost of any court reporter or
stenographer employed by the parties and the reasonable attorneys' fees and
expenses of the parties.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the date above first written.
XRG, Inc. EXECUTIVE:
a Delaware corporation
for XRG Logistics, Inc.
By:
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Title:
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Attachment:
Exhibit A - Description of Quarterly Bonus Program
