EXHIBIT I
EMPLOYMENT AGREEMENT
This Employment Agreement (The "Agreement") is made as of May 24, 1999 by
and between TriStar Aerospace, Inc, doing business at 0000 Xxxxxxxxxxx, Xxxxxx,
Xxxxx 00000 (the "Company") and Xxxxxx X. Xxxxx, residing presently at 0000
Xxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxx 00000-0000 ("Employee").
W I T N E S S E T H:
WHEREAS, the Company is engaged in the business of distributing aerospace
hardware and providing inventory management services; and
WHEREAS, Employee is experienced and knowledgeable in the management of
information systems and has agreed to work for the Company as its Vice President
of Information Technology;
WHEREAS, the Company is interested in employing Employee and Employee is
interested in working for the Company; and
WHEREAS, this Agreement will supersede and replace all prior consulting
and/or employment agreements between the Company and Employee;
NOW THEREFORE, in consideration of the mutual covenants and conditions
herein contained, the: parties hereto agree as follows:
1. Employment. Employee is hereby employed in the position of Vice
President of Information Technology of the Company to render services in
connection with the management of the information systems of the Company.
Employee hereby accepts such employment and agrees that he will at all times use
his best efforts to discharge his duties and utilize his skills in the best
interests of the Company.
2. Duties.
(a) Employee will have responsibility for all functions and duties
related to the information systems of the Company.
(b) Employee will perform all other duties as assigned by the President
and Chief Executive Officer and by the Company's Board of Directors.
3. Location of Employment. Employee's office and principal place of
business in carrying out his duties hereunder shall be at the Company's
corporate headquarters in Dallas. Employee will give reasonable consideration
to any proposed change in the location of his employment if such change would
serve the best interest of the Company. If the Company does relocate Employee,
it will provide him with adequate financial compensation to offset his moving
expenses and any losses he incurs due to the relocation.
4. Term. Employee's employment under this Agreement shall be for a term of
one year commencing an May 24, 1999 (the "Commencement Date") and ending on
May 24, 2000. This Agreement may be renewed if 30 days before the termination
date of this Agreement the parties agree in writing to extend the Agreement to
a specific date. The period beginning on the Commencement Date and ending
May 24, 2000, or upon the expiration of any renewal period shall be referred
to as the "Employment Term."
5. Compensation. In consideration for the services to be performed by
Employee herein, the Company shall pay Employee as follows:
(a) Base Salary. The Company shall pay to Employee an annual base salary
of $175,000. This salary shall be payable in accordance with the
customary payroll practices of the Company. The Employee shall be
eligible for such raises as the Compensation Committee of the Board of
Directors of the Company (the "Compensation Committee"), in its sole and
absolute discretion, may provide.
(b) Bonus. In addition to a base salary, the Employee is entitled to
participate in the Bonus Plans which may be approved and authorized,
from time to time, by the Compensation Committee.
(c) Taxes. All compensation paid to Employee hereunder shall be subject
to applicable employment and withholding taxes. Employee shall be
responsible for any taxes resulting from a determination that any
portion of any benefits supplied to Employee hereunder may be
reimbursing personal as well as business expenses.
6. Employee Benefits.
(a) Benefit Plans or Other Arrangements. Subject to meeting eligibility
provisions, Employee shall be entitled to participate in all employee
benefit plans of the Company, and to receive such other employee
benefits as are available to the Company's officers as such benefits may
exist from time to time, including but not limited to, group health,
disability and life insurance benefits and participation in the
Company's 401(k) and Profit Sharing Plan and the Company's stock option
plans. Employee will be subject to any changes made to the aforesaid
employee benefit plans.
(b) Vacations and Sick Leave. Employee shall be entitled to receive the
same number of sick leave and vacation days as is maintained in the
Company's vacation and sick leave plan.
7. Expenses.
(a) Relocation Expenses. Upon presentation by the Employee to the
Company of expense reports and satisfactory supporting documentation
evidencing payment of such expenses, in such form as shall be requested
by the Company, the Company shall reimburse the Employee for such
expenses as the Board of Directors of the Company, in its sole and
absolute discretion, determines
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to be necessary and reasonable in connection with the relocation of
Employee, his family and their personal effects to a new location
designated by the Company.
(b) Business Expenses. During the term of the Employee's employment
hereunder, the Employee shall be entitled to receive reimbursement for
all reasonable travel and business expenses incurred by him (in
accordance with the policies and procedures of the Company) at the
express direction of the President of the Company, provided that the
Employee promptly and properly accounts therefore in accordance with the
Company's expense policy.
8. Termination. Employee's employment may be terminated during the
Employment Term by either party at any time by giving written notice to the
other party stating the grounds for such termination in accordance with the
provisions of this Section 8. In the event of such termination, Employee's
rights and entitlements shall be determined in accordance with the following
provisions:
(a) Disability. The Company shall have the right to terminate this
Agreement if Employee incurs a permanent disability during the
Employment Term. For the purpose of this Agreement, "Permanent
Disability" shall mean inability of Employee to perform the services
required hereunder due to physical or mental disability which continues
for either (i) a total of 180 working days during any 12-month period
or (ii) 150 consecutive working days. In the event that either party
disputes whether Employee has a permanent disability, such dispute shall
be submitted to a physician mutually agreed upon by Employee or his
legal guardian and the Company. If the parties are unable to agree on a
mutually satisfactory physician, each shall select a reputable
physician, who, together, shall in turn select a third physician whose
determination of Employee's ability to perform his job duties shall be
conclusive and binding to the parties. Evidence of such disability shall
be conclusive notwithstanding that a disability policy or clause in an
insurance policy covering Employee shall contain a different definition
of "Permanent Disability."
If Employee suffers a Permanent Disability and the Company terminates
his employment after the appropriate time period as cited above,
Employee shall receive his base salary only through the date of
termination.
(b) Death. If Employee dies during the Employment Term, the Employee
shall receive his base salary only through the date of his death.
(c) "For Cause". If The Company terminates this Agreement "For Cause"
as defined in this subsection, Employee shall not be entitled to any
damages from the Company or its employees for such termination. If the
Company terminates this Agreement for cause, Employee shall receive his
base salary only through the date of termination.
For purposes of this Agreement, "For Cause" shall mean the willful,
continued and material failure by Employee to follow the reasonable and
legitimate directions of the Board of Directors or of the President and
Chief Executive Officer in connection with Employee's duties hereunder;
conviction of a felony;
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embezzlement from the Company; fraud; engaging in conduct contrary to
the best interests of the company; habitual absenteeism not related to
disability or illness; or breach of a material term of this Employment
Agreement.
(d) "Without Cause". If the Company terminates this Agreement without
Cause, Employee shall receive the balance of his base salary under this
Agreement pursuant to subsection (f) below until the end of the
Employment Term.
If Employee's employment with the Company terminates pursuant to this
subsection, he shall be required to mitigate damages by seeking other
employment or otherwise. Any amount paid by the Company hereunder shall
be reduced by any compensation earned by Employee from another employer
or through consulting.
(e) Resignation or Nonrenewal of Agreement. If Employee resigns from his
employment during the Employment Term, he shall receive his base salary
through his date of termination. If this Agreement expires by its own
terms or either Company or Employee choose not to renew the Agreement,
then Employee shall receive his base salary through the date the
Agreement expires.
(f) Time for Payment. The payment of any balance of Employee's base
salary due under this section will be made on the Company's regularly
scheduled pay days.
9. Additional Obligations of Employee During and After Employment.
(a) Acknowledgments. Employee acknowledges that, as an officer and
employee of the Company (including its subsidiaries and its affiliated
companies) he will obtain information that derives independent value
from not being generally known to the public. Employee acknowledges
that part of the consideration for the covenant not to compete in
Section 10 is supported by this factor.
(b) Noncompetition and Nonsolicitation. During the Employment Term,
Employee will not, directly or indirectly, work for or provide any
services to any employer or other business entity who competes with the
Company in the states of California. Florida. Texas and Arizona. During
the Employment Term the Employee shall not contact nor solicit any
Company customer, supplier or agent for the purposes of inducing at
persuading them to change in any way their business relationship with
the Company. For the purposes of this section, a customer is defined as
any party who, on the date of termination of Employee's employment is,
at within one year prior thereto was, a customer of the Company or to
whom the Company has made, or from whom the Company has received, a
written sales proposal within 12 months prior to the end of the
Employment Term. Employee understands, acknowledges and agrees that
such customers are developed and maintained by the Company through use
of confidential, proprietary, and trade secret information to which
Employee may have access during his employment term.
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The requirement of this subsection does not extend to geographical
locations in which the Company is no longer doing business at the time
the Employment Term ends. Employee also agrees that until 12 months
after the Employment Term for any reason, he will not directly or
indirectly attempt to persuade or induce any Company employee to leave
his or her employment with the Company or hire any such employee to
work with Employee at a subsequent employer. The parties agree that the
limitations contained in this subsection with respect to geographic
area, duration and scope of activity are reasonable. Employee
acknowledges and recognizes that the enforcement of the noncompetiton
provisions in this Agreement by the Company will not interfere with
Employee's ability to earn a livelihood. Employee recognizes and agrees
that the enforcement of this Agreement is necessary to ensure the
preservation and continuity of the business and good will of the
Company. If any court or arbitrator shall determine that the geographic
area, duration or scope of activity of any restriction contained in this
subsection is unenforceable, it is the intention of the parties that
such restrictive covenant shall not be terminated but shall be reformed
to the extent required to render it valid and enforceable.
(c) Records. All records, files, documents, and the like, or abstracts,
summaries, or copies thereof, relating to the business of the Company,
which the Company or Employee shall prepare or use or come into contact
with during his employment, shall remain the sole property of the
Company and shall not be removed from the premises or disclosed to any
person without written consent of the company, and Employee shall
promptly turn all such records in his possession or under his control
to the Company upon termination of his employment.
(d) Trade Secrets and Confidentiality. During the course of Employee's
employment, he will have access to and become familiar with various
trade secrets and confidential information belonging to the Company,
consisting of but not limited to, compilations of information, financial
and operations records, technical specifications, sales procedures,
customer requirements, pricing information, customer and supplier lists,
methods of doing business, and business plans. Employee acknowledges
that such confidential information and trade secrets exist and are owned
and shall continue to be owned solely by the Company and that he shall
not discuss or disclose any trade secrets or confidential information
belonging to the Company to any person or entity except as is required
for him to perform his duties under this Agreement.
(e) Relief. In addition to its other remedies, the Company shall be
entitled to equitable relief, including provisional and final injunctive
relief, to enforce its rights under this section.
10. Notices. All notices required to be given hereunder shall be personally
delivered to the signatories of this Agreement or shall be given by certified
mail, return receipt requested, addressed to the party to which the notice is to
be given at the address for that party first set forth above.
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11. Arbitration. Any controversy or claim arising out of or relating to
this Agreement, except involving matters under Section 9 of this Agreement which
will be resolved in the Texas State Courts, shall be settled by binding
arbitration. Any such arbitration proceedings shall be conducted as follows:
(a) Any party wishing to pursue a claim or controversy under this
section must give the other party written notice of the claim or
controversy within 18O days after the disputed event occurred.
(b) Arbitration shall be conducted by three arbitrators, one to be
selected by each of the parties and the third to be designated by the
two arbitrators so selected. In the event of their failure to agree on
the third arbitrator, selection shall be made by the American
Arbitration Association of Dallas, Texas where the arbitration shall
take place.
(c) The arbitrators shall follow the Employment Arbitration Rules of the
American Arbitration Association, except as otherwise provided herein or
agreed to by the parties. The Arbitrators shall substantially comply
with Texas rules of evidence; shall grant essential but limited
discovery; shall provide for the exchange of witness lists and exhibit
copies; shall conduct a pretrial hearing; and shall consider dispositive
motions. Each party shall have the right to request the arbitrators to
make findings of specific factual issues.
(d) In the event the Company terminates Employee's employment under
Section 8(c) of this Agreement and Employee challenges the termination
under this section, if the Arbitrator rules that the Company did not
have cause to terminate Employee's employment, the maximum amount of
damages that the Arbitrators may award to Employee is the balance of his
base salary under this Agreement and Employee's legal fees and expenses
in bringing the Arbitration.
(e) The Arbitrators shall complete their proceedings and render their
decision within 40 days after submission of the dispute to them, unless
both parties agree to an extension. Each party shall cooperate with the
Arbitrators to comply with procedural time requirements, and the failure
of either to do so shall entitle the Arbitrators to extend the
Arbitration proceedings accordingly and to impose sanctions on the party
responsible for the delay, payable to the other party.
(f) The majority decision of the Arbitrators shall contain findings of
facts on which the decision is based, including any specific factual
findings requested by either party, and shall further contain the
reasons for the decision with reference to the legal principles on which
the Arbitrators relied. Such decision of the Arbitrators shall be final
and binding upon the parties, and accordingly the Company and Employee
shall promptly comply with the terms of such award, and a judgment by a
court of competent jurisdiction may be entered in accordance therewith.
(g) The fees and expenses of the arbitrators in connection with the
resolution of disputes pursuant hereto shall be borne by the party who
does not prevail in the arbitration.
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(h) The Company and Employee hereby consent to the jurisdiction of the
courts of the State of Texas for purposes of entering judgment with
respect to an arbitration award.
12. Indemnification. Employee will be subject to and provided the
protection afforded in the indemnification provisions of the current provisions
of the Company's Certificate of Incorporation and By-Laws.
13. Miscellaneous Provisions.
(a) Entire Agreement. This Agreement replaces and supplants all prior
agreements, oral or written, between the parties and constitutes the
entire understanding of the parties; and no change, alteration or
modification hereof may be made except by a writing signed by the
parties hereto.
(b) Succession. This Agreement shall be binding upon and shall inure to
the benefit of the parties hereto and their respective heirs, legal
representatives, successors and assigns. The Company shall have the
right to assign this Agreement to a parent, affiliate or subsidiary
corporation or to any corporation with which it may merge or consolidate
subject to the provisions of Section 8(e) herein.
(c) Applicable Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
(d) Amendment. This Agreement may only be amended, or a new agreement
substituted, by a written instrument duly authorized and executed by the
Company and Employee.
(e) Waiver. The waiver by either party of a breach or violation of any
provision of this Agreement shall not operate as or be construed as a
waiver of any subsequent breach hereof.
(f) Severability. The Company and Employee agree that each of the
foregoing covenants shall be deemed a separate, severable and
independent covenant, and in the event any covenant shall be declared
invalid by any court of competent jurisdiction, such invalidity shall
not in any manner affect or impair the validity or enforceability of any
other unrelated part or provision of such covenant or of any other
covenant contained herein.
(g) Multiple Originals. This Agreement may be executed in multiple
originals, each of which shall be deemed an original.
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IN WITNESS WHEREOF the parties have executed this Agreement as of this 24th
day of May, 1999.
COMPANY:
TriStar Aerospace, Inc.
By: /s/ Xxxxxxx Xxxxxxxxxx
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Xxxxxxx Xxxxxxxxxx
President and Chief Executive Officer
EMPLOYEE:
/s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx
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