EXHIBIT 10.8
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is entered into on October 2, 2006 by and
between LAST MILE LOGISTICS GROUP, INC., a Florida corporation (the "Company"),
and XXXXX X. XXXXX, an individual (the "Executive").
WITNESSETH:
WHEREAS, the Executive has served as the Vice and President and Chief
Financial Officer of Chesapeake Logistics, LLC, a Maryland limited liability
company ("CL"), since its inception;
WHEREAS, the Company has acquired all of the issued and outstanding
units of CL;
WHEREAS, the Company desires to employ the Executive, and the Executive
desires to be employed by the Company, pursuant to the provisions of this
Employment Agreement (the "Agreement");
NOW, THEREFORE, in consideration of the premises, and the respective
covenants and agreements of each of the Company and the Executive contained in
this Agreement, each of the Company and the Executive agrees as follows:
ARTICLE I
CERTAIN DEFINITIONS
The following terms shall have the following respective meanings when
utilized in this Agreement:
"Affiliate" means, with respect to any specified Person, any other
Person which, directly or indirectly, controls, or is controlled by or is under
common control with, such specified Person. For purposes of this definition, the
concept of "control," when used with respect to any specified Person, signifies
the possession of the power to direct the management and policies of such
specified Person, directly or indirectly, whether through the ownership of
voting securities or partnership or other equity or ownership interests, by
contract or otherwise.
"Agreement" means this Employment Agreement as it is now or hereafter
in effect.
"Approved Board" means a Board of Directors of the Company that, as of
a given date, is comprised of individuals at least a majority of whom have
continuously served as directors of the Company during the period of two years
ending on such date, unless the election of each director who was not a director
at the beginning of such two year period was approved in advance by the
directors representing at least two-thirds of the directors then in office who
were directors at the beginning of such two year period.
"Approved Change in Control of the Company" means any transaction or
series of transactions which:
(a) results, or is reasonably anticipated to result, in a
Change in Control of the Company;
(b) is approved by the requisite vote of an Approved Board
pursuant to, and in accordance with, applicable law and the Articles of
Incorporation and Bylaws of the Company; and
(c) if required by applicable law or the Articles of
Incorporation or Bylaws of the Company, is approved by the requisite
vote of the shareholders of the Company pursuant to, and in accordance
with, applicable law and the Articles of Incorporation and Bylaws of
the Company.
"Bonus" means, as of a given date, the most recent annual performance
bonus awarded by the Company to the Executive.
"Cause" means any action by the Executive or any inaction by the
Executive which, after due consideration, is reasonably determined by the Board
of Directors of the Company to constitute:
(a) fraud, embezzlement, misappropriation, dishonesty or
breach of trust;
(b) a felony or moral turpitude;
(c) material breach or violation of any or all of the
covenants, agreements and obligations of the Executive set forth in
this Agreement, other than as the result of the Executive's death or
Disability;
(d) a willful or knowing failure or refusal by the Executive
to perform any or all of his material duties and responsibilities as an
officer of the Company, other than as the result of the Executive's
death or Disability; or
(e) gross negligence by the Executive in the performance of
any or all of his material duties and responsibilities as an officer of
the Company, other than as a result of the Executive's death or
Disability;
provided, however, that if the basis for any termination of the Executive's
employment by the Company as set forth in the Termination Notice delivered by
the Company to the Executive is any or all of the definitions of Cause set forth
in paragraphs (c), (d) or (e) of this definition, then, in such event, the
Executive shall have thirty (30) days from and after the date of his receipt of
such Termination Notice to present a reasonable plan to cure such action or
inaction specified in the Termination Notice, which plan may require more than
thirty (30) days to cure the specified action or inaction, but such plan shall
be reasonably satisfactory to the Company.
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"Change in Control of the Company" means any change in control of the
Company of a nature which would be required to be reported (a) in response to
Item 6(e) of Schedule 14A of Regulation 14A, as in effect on the date of this
Agreement, promulgated under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), (b) in response to Item 1 of the Current Report on Form
8-K, as in effect on the date of this Agreement, promulgated under the Exchange
Act, or (c) in any filing by the Company with the United States Securities and
Exchange Commission; provided, however, that, without limitation, a Change in
Control of the Company shall be deemed to have occurred if:
(a) subsequent to the date of this Agreement, any "person" (as
such term is defined in Sections 13(d)(3) and 14(d)(2) of the Exchange
Act), other than the Company, any subsidiary of the Company or any
compensation, retirement, pension or other employee benefit plan or
trust of the Company or any subsidiary of the Company, becomes the
"beneficial owner" (as such term is defined in Rule 13d-3 promulgated
under the Exchange Act), directly or indirectly, of securities of the
Company or any successor to the Company (whether by merger,
consolidation or otherwise) representing twenty percent (20%) or more
of the combined voting power of the Company's then outstanding
securities;
(b) during any period of two consecutive years, the
individuals who at the beginning of such period constitute the Board of
Directors of the Company cease for any reason to constitute at least a
majority of such Board of Directors, unless the election of each
director who was not a director at the beginning of such period has
been approved in advance by the directors representing at least
two-thirds of the directors then in office who were directors at the
beginning of such period;
(c) the Company shall merge or consolidate with or into
another corporation or other entity, or enter into a binding agreement
to merge or consolidate with or into another corporation or other
entity, other than a merger or consolidation which would result in the
voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving corporation or
entity) not less than eighty percent (80%) of the combined voting power
of the voting securities of the Company or such surviving corporation
or entity outstanding immediately after such merger or consolidation;
(d) the Company shall sell, lease, exchange or otherwise
dispose of all or substantially all of its assets, or enter into a
binding agreement for the sale, lease, exchange or other disposition of
all or substantially all of its assets, in one transaction or in a
series of related transactions; or
(e) the Company shall liquidate or dissolve, or any plan or
proposal shall be adopted for the liquidation or dissolution of the
Company.
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"CL" means Chesapeake Logistics, LLC, a Maryland limited liability
company.
"Company" means Last Mile Logistics Group, Inc., a Florida corporation.
"Compensation" means the sum of the Executive's Salary and Bonus.
"Disability" means any mental or physical illness, condition,
disability or incapacity which prevents the Executive from reasonably
discharging his duties and responsibilities as an officer of the Company. If any
disagreement or dispute shall arise between the Company and the Executive as to
whether the Executive suffers from any Disability, then, in such event, the
Executive shall submit to the physical or mental examination of a licensed
physician, who is mutually agreeable to the Company and the Executive, and such
physician shall determine whether the Executive suffers from any Disability. In
the absence of fraud or bad faith, the determination of such physician shall be
final and binding upon the Company and the Executive. The entire cost of such
examination shall be paid for solely by the Company.
"Executive" means Xxxxx X. Xxxxx, an individual.
"Good Reason" means:
(a) the assignment by the Board of Directors of the Company to
the Executive, without his express written consent, of duties and
responsibilities which results in the Executive having less significant
duties and responsibilities or exercising less significant power and
authority than he had, or duties and responsibilities or power and
authority not comparable to that of the level and nature which he had,
immediately prior to such assignment;
(b) the removal of the Executive from, or a failure to
reappoint the Executive to, his then current position with the Company
or its subsidiaries or affiliates, except (i) with the Executive's
express written consent or (ii) in connection with any termination of
the Executive's employment by the Company as the result of the
Executive's Protracted Disability or for Cause;
(c) the Company's failure to perform on a timely basis its
obligations under this Agreement;
(d) the Company's requiring the Executive, without his express
written consent, to travel on Company business to an extent
substantially greater than the Executive's business travel obligations
immediately prior to such time;
(e) the Company's requiring the Executive, without his express
written consent, to change his place of permanent residency; or
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(f) the failure of the Company to obtain the express written
assumption of, and agreement to perform on a timely basis, the
Company's obligations under this Agreement by any successor to the
Company as required by Article XI of this Agreement.
"Person" means any individual, person, firm, corporation, partnership,
limited liability company, association or other entity, or any combination of
any of the foregoing.
"Protracted Disability" means any Disability which prevents the
Executive from reasonably discharging his duties and responsibilities as an
officer of the Company for a period of twelve (12) consecutive months.
"Salary" means, as of a given date, the Executive's then current annual
salary.
"Successor Agreement" shall have the meaning set forth in Article X of
this Agreement.
"Termination Date" means a specific date not less than forty-five (45)
nor more than ninety (90) days from and after the date of any Termination Notice
upon which the Executive's employment by the Company shall be terminated in
accordance with the provisions of this Agreement.
"Termination Notice" shall mean a written notice which sets forth (a)
the specific provision of this Agreement relied upon to terminate the
Executive's employment, (b) in reasonable detail the facts and circumstances
claimed to provide the basis for the termination of the Executive's employment,
and (c) a Termination Date.
"Territory" shall have the meaning set forth in Section 9.1(c) of this
Agreement.
ARTICLE II
EMPLOYMENT
The Company employs the Executive and the Executive accepts such
employment. Subject to the direction of the Board of Directors, the Executive
shall serve as the President, Chief Operating Officer, Chief Financial Officer,
Chief Accounting Officer and Secretary of the Company, CL and each of the
subsidiary corporations and other entities of the Company and CL. The Executive
shall have such responsibilities, perform such duties and exercise such power
and authority as are inherent in, or incident to, such offices. The Executive
shall devote substantially all of his business time and attention and his best
efforts to the diligent performance of his duties as an employee of the Company.
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ARTICLE III
TERM
Subject to the provisions of Article VII below, the term of this
Agreement shall be for a period of five (5) years, commencing on October 1, 2006
and expiring on September 30, 2011.
ARTICLE IV
SALARY
4.1 INITIAL SALARY. In full payment for the obligations to be performed
by the Executive during the term of this Agreement, the Company shall pay to the
Executive a salary (subject to applicable payroll and/or other taxes required by
law to be withheld) equal to One Hundred Twenty-Five Thousand Dollars
($125,000.00) per annum.
4.2 ADJUSTMENT OF SALARY. As promptly as practicable after the
conclusion of each of the Company's fiscal years during the term of the
Executive's employment hereunder, commencing at the conclusion of the Company's
fiscal year ending December 31, 2006, the certified public accountants regularly
retained by the Company shall determine the increase or decrease, if any, in the
cost of living, using as the basis of such computation the then current
applicable Consumer Price Index published by the Bureau of Labor Statistics of
the United States Department of Labor (the "Index"). Any such increase or
decrease shall be computed as follows:
(a) The Index number in the column for Baltimore, Maryland,
entitled "all items," for the month of January shall be the "Current Index
Number" and the corresponding Index number for the immediately preceding
January, commencing with January 2006, shall be the "Base Index Number."
(b) The increase or decrease in the cost of living shall be
determined by dividing the Current Index Number by the Base Index Number and
subtracting the integer 1 from the quotient thereof, in accordance with the
following formula:
Increase/Decrease
in = Current Index Number __ 1
Cost of Living Base Index Number
(c) The percentage increase or decrease in the cost of living,
multiplied by the Executive' then current salary, shall be the increase or
decrease required to be determined pursuant to this Section 4.2.
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(d) If the publication of the Consumer Price Index is
discontinued for any reason, then the parties shall utilize comparable
statistics of the cost of living for Baltimore, Maryland, as computed and
published by an agency or instrumentality of the United States of America or by
a responsible financial periodical or recognized authority then to be selected
by the parties.
(e) In the absence of fraud, any determination made by the
Company's accountants pursuant to this Section 4.2 shall be conclusive and
binding upon the Company and the Executive.
(f) The Executive's then current salary shall be adjusted as
of January 1 of each fiscal year of the Company, commencing with the fiscal year
ending December 31, 2007, in accordance with the provisions of this Section 4.2
and such adjustment shall remain in effect during such fiscal year.
4.3 PAYMENT OF SALARY. Payments of salary shall be made to the
Executive in installments from time to time on the same dates payments of salary
are generally made to all senior management employees of the Company.
ARTICLE V
PERFORMANCE BONUS
The Executive may from time to time receive a performance bonus as
shall be determined by the Board of Directors of the Company.
ARTICLE VI
CERTAIN FRINGE BENEFITS
6.1 GENERALLY. The Executive shall be entitled to receive such benefits
and to participate in such benefit plans as are generally provided from time to
time by the Company to its senior management employees; provided, however, that
nothing contained in this Section 6.1 shall be construed to obligate the Company
to provide any specific benefits to its employees generally.
6.2 VACATIONS. The Executive shall be entitled to vacation time on an
annual basis in accordance with such policies as are from time to time adopted
by the Company's Board of Directors with respect to its senior management
employees.
6.3 HEALTH INSURANCE. The Company shall provide health insurance to the
Executive and his family or reimburse him for the cost of such health insurance.
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6.4 AUTOMOBILE. The Company shall provide the Executive an automobile
for use by the Executive in connection with the performance of his duties under
this Agreement. The Executive shall be entitled to receive reimbursement for
such automobile expenses as are incurred by the Executive in connection with the
performance of his duties under this Agreement. Such reimbursement shall include
the cost of operating the automobile, the cost for maintenance of such
automobile and the cost of insurance of such automobile.
6.5 STOCK OPTIONS.
(a) The Executive shall be entitled to participate in the
Company's stock option plans as may from time to time be in effect and to
receive such incentive or other stock options as may from time to time be
granted to him thereunder; provided, however, that nothing contained in this
Section 6.5(a) shall be construed to obligate the Company, its Board of
Directors or any committee of its Board of Directors to grant any incentive or
other stock option whatsoever to the Executive.
(b) In order to induce the Executive to enter into this
Agreement and to perform his obligations hereunder, simultaneously with the
execution and delivery of this Agreement, the Company and the Executive are
entering into a Stock Option Agreement of even date herewith, pursuant to which
the Company is issuing to the Executive options, vesting over time, to purchase
One Million (1,000,000) shares of the Company's common stock at an exercise
price of Ten Cents ($0.10) per share.
6.6 BUSINESS, TRAVEL AND ENTERTAINMENT EXPENSES. Within a reasonable
time after the submission of appropriate receipts and other evidence by the
Executive, the Company shall pay, or reimburse the Executive for, all reasonable
business, travel and entertainment expenses incurred by the Executive in
connection with the performance of his duties and responsibilities on behalf of
the Company.
ARTICLE VII
TERMINATION OF EMPLOYMENT
7.1 TERMINATION OF EMPLOYMENT.
(a) Notwithstanding the provisions of Article III hereof, this
Agreement (i) shall automatically terminate upon the death of the Executive
pursuant to the provisions of Section 7.2 hereof, (ii) may be terminated at any
time by the Company pursuant to the provisions of Sections 7.3 or 7.4 hereof,
and (iii) may be terminated at any time by the Executive pursuant to the
provisions of Section 7.5 hereof.
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(b) If either the Company or the Executive shall desire to
terminate the Executive's employment by the Company pursuant to any of the
provisions of Sections 7.3, 7.4, or 7.5 of this Agreement, then, in such event,
the party causing such termination shall provide a Termination Notice to the
other party.
(c) If this Agreement shall be terminated pursuant to any of
the provisions of this Article VII, the Company shall be discharged from all of
its obligations to the Executive under this Agreement upon the payment to the
Executive of the amount set forth in the Section of this Article VII pursuant to
which such termination shall occur. The Executive's sole and exclusive remedy
for the termination of this Agreement prior to October 1, 2011, regardless of
whether such termination shall be initiated by the Company or the Executive, and
regardless of whether such termination shall be with or without Cause, shall be
the payment by the Company to the Executive of the amount set forth in the
Section of this Article VII pursuant to which such termination shall occur.
7.2 DEATH OF EXECUTIVE. If during the term of this Agreement the
Executive shall die, then the employment of the Executive by the Company shall
automatically terminate on the date of the Executive's death. In such event, not
more than thirty (30) days after the date of the Executive's death, the Company
shall pay to the Executive's estate or as otherwise directed by the Executive's
personal representative or executor, an amount in cash equal to the Executive's
Compensation (subject to applicable payroll and/or other taxes required by law
to be withheld) determined as of the date of the Executive's death.
7.3 DISABILITY OF EXECUTIVE.
(a) In the event that at any time during the term of this
Agreement the Executive shall suffer any Disability, then the Company shall be
obligated to continue to pay in the ordinary and normal course of its business
to the Executive or his legal representative, as the case may be, the
Executive's Compensation (subject to applicable payroll and/or other taxes
required by law to be withheld) from the date that the Executive shall first
suffer any such Disability to the date that the Executive's employment by the
Company shall be terminated pursuant to any of the provisions of this Agreement.
(b) In the event that the Executive shall suffer any
Protracted Disability during the term of this Agreement, then the Company may
terminate the Executive's employment under this Agreement. In such event, in
addition to any other benefits which may have been provided by the Company to
the Executive or his legal representative, as the case may be, pursuant to the
provisions of Section 7.3(a) above, not later than the Termination Date
specified in the Termination Notice delivered by the Company to the Executive or
his legal representative, as the case may be, the Company shall pay to the
Executive or as otherwise directed by the Executive's legal representative an
amount in cash equal to the Executive's Compensation (subject to applicable
payroll and/or taxes required by law to be withheld) determined as of the date
of such Termination Notice. Subsequent to such Termination Date, the Executive
or his legal representative, as the case may be, shall also be entitled to
receive any benefits which may be payable under any disability insurance policy
or disability plan provided to the Executive by the Company.
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7.4 TERMINATION OF EMPLOYMENT BY COMPANY.
(a) The Company may terminate this Agreement at any time with
Cause. In such event, the Company shall be obligated to continue to pay in the
ordinary and normal course of its business to the Executive only his Salary
(subject to applicable payroll and/or other taxes required by law to be
withheld) through the Termination Date set forth in the Termination Notice.
(b) The Company may terminate this Agreement at any time
without Cause. In such event, (i) not later than the Termination Date specified
in the Termination Notice, the Company shall pay to the Executive an amount in
cash equal to the sum of the Executive's Compensation (subject to applicable
payroll and/or other taxes required by law to be withheld) determined as of the
date of such Termination Notice through the remaining term of the Agreement and
(ii) the restrictions set forth in Section 9.1(c) hereof shall not be applicable
to the Executive.
7.5 TERMINATION OF EMPLOYMENT BY EXECUTIVE.
(a) The Executive may terminate this Agreement at any time
with Good Reason. In such event, (i) not later than the Termination Date
specified in the Termination Notice, the Company shall pay to the Executive an
amount in cash equal to the sum of the Executive's Compensation (subject to
applicable payroll and/or other taxes required by law to be withheld) determined
as of the date of such Termination Notice through the remaining term of the
Agreement and (ii) the restrictions set forth in Section 9.1(c) hereof shall not
be applicable to the Executive.
(b) The Executive may terminate this Agreement at any time
without Good Reason. In such event, the Company shall be obligated to continue
to pay in the ordinary and normal course of its business to the Executive only
his Salary (subject to applicable payroll and/or other taxes required by law to
be withheld) through the Termination Date set forth in the Termination Notice.
ARTICLE VIII
TERMINATION OF EMPLOYMENT
SUBSEQUENT TO A CHANGE IN CONTROL
OF THE COMPANY
8.1 TERMINATION OF EMPLOYMENT. Notwithstanding the provisions of
Articles III and VII of this Agreement, in the event that (a) there shall occur
any Change in Control of the Company, other than an Approved Change in Control
of the Company, and (b) at any time subsequent to the date of any such Change in
Control of the Company, either (i) the Company shall terminate the employment of
the Executive for any reason, other than as the result of the death or the
Protracted Disability of the Executive or for Cause, or (ii) the Executive shall
terminate his employment for Good Reason, then, in any such event, (A) not later
than the Termination Date specified in the Termination Notice delivered by the
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Company to the Executive, or by the Executive to the Company, as the case may
be, the Company shall pay to the Executive an amount in cash equal to the
Executive's Compensation, determined as of the date of such Termination Notice,
multiplied by three (subject to applicable payroll and/or other taxes required
by law to be withheld), and (B) any and all stock options granted to the
Executive under any stock option plan of the Company as may from time to time be
in effect, which shall not by their terms have vested on or before such
Termination Date, shall vest on such Termination Date.
8.2 LIMITATION ON PAYMENT. Notwithstanding anything to the contrary set
forth in Section 8.1 above, the amount paid by the Company to the Executive
shall be limited to the maximum amount which will not constitute a "parachute
payment," as such term is defined in Section 280G(b)(2) of the Internal Revenue
Code of 1986, as amended. This limitation shall first be applied to amounts
provided pursuant to clause (B) of Section 8.1 hereof (otherwise included in the
calculation of a parachute payment) to the extent thereof and then to amounts
provided pursuant to clause (A) of Section 8.1 hereof.
ARTICLE IX
CERTAIN RESTRICTIONS ON THE EXECUTIVE
9.1 CERTAIN RESTRICTIVE COVENANTS. The Executive covenants and agrees
with the Company as follows:
(a) He shall not at any time, directly or indirectly, for
himself or for any other Person, approach, counsel, solicit, induce or attempt
to approach, counsel, solicit or induce any Person employed or engaged by the
Company or any of its Affiliates, whether such Person is a full-time employee,
part-time employee or independent contractor, to terminate his, her or its
employment or independent contractor relationship with the Company or its
Affiliate.
(b) He shall not at any time, directly or indirectly, for
himself or for any other Person employ, attempt to employ or enter into any
contractual arrangement for employment with, engage, attempt to engage or enter
into any contractual arrangement for the engagement of, any employee or former
employee or independent contractor or contractor of the Company or any of its
Affiliates, unless such former employee or independent contractor shall not have
been employed or engaged by the Company or any of its Affiliates for a period of
at least one year.
(c) He shall not, while he is employed by the Company and for
a period of two years from and after the date that his employment by the Company
ceases or terminates for any reason, directly or indirectly, for herself or for
any other Person:
(i) acquire or own in any manner any interest in, or
loan any amount to, any Person which competes in any manner with the Company or
any of its Affiliates in the United States of America, its territories and
possessions, and the District of Columbia (the "Territory");
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(ii) be employed by or serve as an employee, agent,
officer, or director of, or as a consultant to, or as an independent contractor
or salesperson for, any Person which competes in any manner with the Company or
any of its Affiliates in the Territory;
(iii) procure goods or services from any supplier or
vendor to the Company or any of its Affiliates, other than on behalf of the
Company or any of its Affiliates;
(iv) provide any goods or services to any past or
present customer of the Company or any of its Affiliates, other than on behalf
of the Company or any of its Affiliates; or
(v) compete in any manner with the Company or any of
its Affiliates in the Territory.
The foregoing provisions of this Section 9.1(c) shall not prevent the Executive
from acquiring and owning not more than one percent of the equity securities of
any Person whose securities are listed for trading on a national securities
exchange or are regularly traded in the over-the-counter securities market.
9.2 INDEPENDENT AGREEMENTS. The restrictive covenants set forth in
Section 9.1 above (collectively, the "Restrictive Covenants") shall be construed
as agreements independent of any other provision contained in this Agreement,
and the existence of any claim or cause of action, whether predicated upon this
Agreement or otherwise, against the Company shall not constitute a defense to
the enforcement by the Company of any of the Restrictive Covenants. The
Executive acknowledges that the Company has fully performed all obligations
entitling it to the benefits of the Restrictive Covenants, and that the
Restrictive Covenants, therefore, are not executory or otherwise subject to
rejection under the Bankruptcy Code of 1978.
9.3 REASONABLE RESTRAINT. Each of the Company and the Executive
acknowledges that each of the Restrictive Covenants is a reasonable and
necessary restraint of trade and does not violate any applicable laws, rules or
regulations, including without limitation the Xxxxxxx Antitrust Act, the
Maryland Antitrust Act or the common law. Each of the Company and the Executive
acknowledges that the Company or its Affiliates conducts its business activities
throughout the Territory. Each of the Company and the Executive acknowledges
that each of the Restrictive Covenants is supported by valid and legitimate
business interests, including without limitation the need to protect the
Confidential Information and Trade Secrets of the Company (as such terms are
hereinafter defined), and the need to protect the substantial relationships of
the Company with its employees and independent contractors, current and
prospective customers, and current and prospective vendors, and that the period
of restriction set forth in Section 9.1(c) above is essential to the full
protection of each of such valid and legitimate business interests.
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9.4 SEVERABILITY. Each of the Company and the Executive agrees that
each of the Restrictive Covenants is reasonable and proper with respect to
duration, geographical scope, and lines of business. If all or any portion of
any of the Restrictive Covenants is held by a court of competent jurisdiction to
be unreasonable, arbitrary or against public policy for any reason, then all or
such portion of such Restrictive Covenants shall be considered divisible as to
duration, geographical scope or lines of business, or may be otherwise narrowed
so as to be enforceable. If a court of competent jurisdiction shall determine
that a time period, a geographical area or a specified line of business is
unreasonable, arbitrary or against public policy for any reason, then a shorter
period, a smaller geographical area or a narrower line of business, as shall be
determined by such court to be reasonable, non-arbitrary and not against public
policy, may be enforced against the Executive by the Company.
ARTICLE X
CONFIDENTIAL INFORMATION AND TRADE SECRETS
10.1 CERTAIN DEFINITIONS.
(a) "Confidential Information" includes information which (a)
has been or is developed or is otherwise owned by the Company or any of its
Affiliates, whether developed by the Company or by any other Person, (b) is not
readily available to the public and not generally ascertainable by proper means
by the public, (c) if disclosed to the public, would be harmful to the interests
of the Company or any of its Affiliates, (d) has limited disclosure within the
Company or its Affiliate, or (e) is treated or designated by the Company or any
of its Affiliates as being confidential. Confidential Information may consist of
technical information, including without limitation inventions, formulas,
compilations, computer programs, methods, purchasing techniques and processes,
sales techniques and processes, market data and pricing and discounting
practices, as well as business information relating to the Company's or any of
its Affiliates' financial condition, financial arrangements, business plans or
strategies (such as new products and services and plans for sales, marketing,
purchasing, distribution, services or promotions), employee training materials,
sales manuals, customer lists, customer needs, contacts, accounts and the like,
vendor or supplier lists, vendor or supplier needs, contacts, accounts and the
like, personnel, payroll and financial data and records, and any and all data,
information, plans, processes, procedures, methods and records of any kind or
nature whatsoever, regardless of the form of storage medium and wherever
located, related in any manner to the Company, any of its Affiliates or their
respective businesses, operations or affairs or directors, officers, employees,
agents or independent contractors.
(b) "Trade Secrets" include Confidential Information which is
sufficiently secret to derive actual or potential economic value to the Company
or any of its Affiliates from not being generally known to, and not being
readily ascertainable by, the Company's or any of its Affiliates' competitors
and other Persons (including without limitation the Company's or any of its
Affiliates' vendors, suppliers and customers), which information gives, or has
the potential of giving, the Company or any of its Affiliates an advantage over
the Company's or any of its Affiliates' competitors or other Persons (including
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without limitation the Company's or any of its Affiliates' vendors, suppliers
and customers) which can obtain economic value from the disclosure or use of the
information and which information the Company or any of its Affiliates has
taken, and will continue to take, reasonable steps to maintain as secret or
confidential vis-a-vis its current and potential competitors and other Persons
(including without limitation the Company's or any of its Affiliates' vendors,
suppliers and customers).
10.2 OWNERSHIP OF CONFIDENTIAL INFORMATION AND TRADE SECRETS. The
Executive acknowledges that, in the course of his relationship with the Company
and its Affiliates, he has received, used, had access to and became familiar
with, or in the future will receive, use, have access to and become familiar
with, the Confidential Information and the Trade Secrets which are owned by the
Company or its Affiliates or which are or will be otherwise used in connection
with the Company's or any of its Affiliates' current or future business. The
Executive acknowledges and agrees that all such Confidential Information and
Trade Secrets are and shall remain the sole and exclusive property of the
Company and that the covenants set forth in Section 10.3 below are fair and
reasonable.
10.3 NON-DISCLOSURE. The Executive shall not, directly or indirectly,
at any time disclose to any Person, or take or use for the purposes of any
Person, other than the Company or any of its Affiliates, any Confidential
Information or Trade Secrets. The Executive shall not, directly or indirectly,
at any time copy or place any Confidential Information or Trade Secrets on to
any personal computer or other data collection or storage device that is not
owned by the Company or one of its Affiliates. The Executive authorizes the
Company to inspect the Executive's personal computer(s) and other personal data
collection or storage device(s) at any time in order to permit the Company to
determine the Executive's compliance with the provisions of the immediately
preceding sentence. The obligations of the Executive set forth in this Section
10.3 apply to, and are intended to prevent, the direct or indirect disclosure of
any Confidential Information or Trade Secrets to Persons where such disclosure
of the Confidential Information or the Trade Secrets would reasonably be
considered to be useful to the Company's or its Affiliates' competitors or to
any other Person to become a competitor based, in whole or in part, on such
Confidential Information or Trade Secrets. Immediately upon the termination of
the Executive's employment by the Company for any reason, the Executive shall
deliver to the Company all Confidential Information and Trade Secrets and all
Company property then in his possession.
10.4 INDEPENDENT AGREEMENTS. The covenants set forth in Section 10.3
above shall be construed as an agreement independent of any other provision
contained in this Agreement, and the existence of any claim or cause of action,
whether predicated upon this Agreement or otherwise, against the Company shall
not constitute a defense to the enforcement by the Company of any of such
covenants. The Executive acknowledges that the Company has fully performed all
obligations entitling it to the benefit of the covenants set forth in Section
10.3 above, and that such covenants, therefore, are not executory or otherwise
subject to rejection under the Bankruptcy Code of 1978.
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10.5 ASSIGNMENT OF WORKS. The Executive assigns to the Company or its
assigns all of the Executive's right, title and interest in and to all
developments, inventions and ideas made, conceived or reduced to practice solely
or jointly by the Executive while engaging in activities within the scope of his
employment by the Company, regardless of whether any of such developments,
inventions and ideas qualify as intellectual property or were conceived or
developed during business hours. The Executive acknowledges and agrees that all
original works of authorship that are made with the scope of his employment by
the Company and which can be legally protected are "works for hire" under
applicable law. The Executive shall notify the Company of all developments,
inventions and ideas and to take all actions necessary to enable the Company to
seek legal protection for them.
ARTICLE XI
SUCCESSOR TO THE COMPANY
The Company shall require any successor, whether direct or
indirect, and whether by purchase, merger, consolidation or otherwise, to all or
substantially all of the business or properties and assets of the Company, to
execute and deliver to the Executive, not later than the date of the
consummation of any such purchase, merger, consolidation or other transaction, a
written instrument in form and in substance reasonably satisfactory to the
Executive and his legal counsel pursuant to which any such successor shall agree
to assume and to perform on a timely basis or to cause to be performed on a
timely basis all of the Company's covenants, agreements and obligations set
forth in this Agreement (a "Successor Agreement"). The failure of the Company to
cause any such successor to execute and deliver a Successor Agreement to the
Executive shall (a) constitute a breach of the provisions of this Agreement by
the Company and (b) be deemed to constitute a termination by the Executive of
his employment hereunder (as of the date upon which any such successor shall
succeed to all or substantially all of the business or properties and assets of
the Company) for Good Reason.
ARTICLE XII
REMEDIES
12.1 INJUNCTION; SPECIFIC PERFORMANCE. It is recognized and
acknowledged by each of the parties that a breach or violation by the Executive
of any or all or the provisions contained in this Agreement will cause
irreparable harm and damage to the Company in a monetary amount which would be
virtually impossible to ascertain. As a result, each of the parties recognizes
and acknowledges that the Company shall be entitled to the remedies of
injunction and/or specific performance from any court of competent jurisdiction
enjoining and restraining any breach or violation by the Executive of any or all
of the provisions contained herein and/or requiring the specific performance of
any or all of the provisions contained herein, and that such rights to
injunction and specific performance shall be cumulative and in addition to
whatever other rights and remedies the Company may possess hereunder, at law and
in equity.
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12.2 DAMAGES; ATTORNEYS' FEES. Nothing contained in this Agreement
shall be construed to prevent either of the parties from seeking and recovering
from the other party damages sustained by it or him as a result of the other
party's breach or violation of any or all of the provisions hereof. If either
party shall bring suit against the other party based in whole or in part upon a
breach or violation of any provision hereof, then, in any such event, the
prevailing party in such suit shall be awarded, and shall be paid by the
non-prevailing party, reasonable fees and disbursements of trial and appellate
counsel paid, incurred or suffered by the prevailing party in connection with
such suit.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
13.1 GOVERNING LAW. This Agreement shall be governed by, and shall be
construed and interpreted in accordance, with the laws of the State of Maryland,
without giving effect to the principles of the conflict of laws thereof.
13.2 NOTICES. Any and all notices and other communications required or
permitted to be given pursuant to this Agreement shall be in writing and shall
be deemed to have been duly given (a) when delivered by hand, (b) two days after
having been delivered to Federal Express, DHL, UPS, Airborne or another
recognized overnight courier or delivery service, (c) when delivered by
facsimile transmission, provided that an original copy of such transmission
shall be sent by first class mail, postage prepaid, or (d) five days after
having been deposited into the United States mail, by registered or certified
mail, return receipt requested, postage prepaid, to the respective parties at
their respective addresses or to their respective facsimile telephone numbers,
as follow:
If to the Company: Last Mile Logistics Group, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attn: Chief Executive Officer
If to the Executive: The home address for the Executive set forth
in the Company's records.
or to such other address as any party may from time to time give written notice
of to the other pursuant to the provisions of this Section 13.2.
13.3 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the Company and the Executive with respect to the subject matter hereof
and supersedes all prior agreements, understandings, negotiations and
arrangements, both oral and written, between the Company and the Executive with
respect to such subject matter.
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13.4 AMENDMENTS. This Agreement may not be amended or modified in any
manner, except by a written instrument executed by each of the Company and the
Executive.
13.5 BENEFITS; BINDING EFFECT. This Agreement shall be for the benefit
of, and shall be binding upon, each of the Company and the Executive and their
respective heirs, personal representatives, executors, legal representatives,
successors and assigns.
13.6 SEVERABILITY. The invalidity of any one or more of the words,
phrases, sentences, clauses or sections contained in this Agreement shall not
affect the enforceability of the remaining portions of this Agreement or any
part hereof, all of which are inserted conditionally on their being valid in
law. Except as otherwise provided in Section 9.4 above, if any one or more of
the words, phrases, sentences, clauses or sections contained in this Agreement
shall be declared invalid by any court of competent jurisdiction, then, in any
such event, this Agreement shall be construed as if such invalid word or words,
phrase or phrases, sentence or sentences, clause or clauses, or section or
sections had not been inserted.
13.7 JURISDICTION AND VENUE; SERVICE OF PROCESS; WAIVER OF TRIAL BY
JURY. If any dispute or controversy shall arise between the Company and the
Executive, then such dispute or controversy may only be brought for resolution
in the United States District Court for the District of Maryland or in the
appropriate state court in and for Xxxxxx County, Maryland. Each of the Company
and the Executive consents to the jurisdiction and venue of such courts, and
agrees that it or he shall not contest or challenge the jurisdiction or venue of
such courts. Each of the Company and the Executive agrees that service of any
process, summons, notice or document, by United States registered or certified
mail, to its or his address set forth in or as provided herein shall be
effective service of process for any action, suit or proceeding brought against
it or him in any such court. In recognition of the fact that the issues which
would arise under this Agreement are of such a complex nature that they could
not be properly tried before a jury, each of the Company and the Executive
waives trial by jury.
13.8 NO WAIVERS. The waiver by either party of a breach or violation of
any provision of this Agreement by any other party shall not operate nor be
construed as a waiver of any subsequent breach or violation. The waiver by
either party to exercise any right or remedy it or he may possess shall not
operate nor be construed as a bar to the exercise of such right or remedy by
such party upon the occurrence of any subsequent breach or violation.
13.9 HEADINGS. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of any or all of the provisions hereof.
13.10 COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the separate parties in separate counterparts, each of which
shall be deemed to constitute an original and all of which shall be deemed to
constitute the one and the same instrument.
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13.11 EFFECTIVE DATE. This Agreement shall be effective for all
purposes as of October 1, 2006.
IN WITNESS WHEREOF, each of the parties has executed and delivered this
Agreement on the date first written above.
LAST MILE LOGISTICS GROUP, INC.
By /s/ Xxxxxx X. Xxxxx /s/ Xxxxx X. Xxxxx
-------------------------------- --------------------------------
Xxxxxx X. Xxxxx, Xxxxx X. Xxxxx
Chairman and
Chief Executive Officer
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