Exhibit 10.63
EMPLOYMENT AGREEMENT
--------------------
This Employment Agreement ("Agreement") is executed and delivered as of
November 1, 1996, by and between Eastern Environmental Services, Inc., a
Delaware corporation ("Company"), and Xxxx Xxxxxx, an individual ("Employee").
RECITALS
--------
The Company conducts a diversified waste management business, including,
without limitation, waste hauling operations, landfills and other waste
management, recycling and waste testing operations ("Business"). The Employee
is an executive with extensive experience in the waste industry. The Company
desires to hire Employee as Vice President of investor relations and the
Employee desires to accept the position offered.
The position of the Employee with the Company will give the Employee access
to and familiarity with confidential information and business methods used in
the operation of the Business. During the course of Employee's employment,
Employee will become familiar with and aware of information as to the specific
manner of doing business and the customers of the Company and the Company's
future plans. Employee has and will have knowledge of trade secrets of the
Company which are valuable assets of the Company.
Employee recognizes that the business of the Company is dependent upon a
number of trade secrets and confidential business information, including
customer lists, customer data and operational information. The protection of
these trade secrets is of critical importance to the Company. The Company will
sustain great loss and damage if, for whatever reason, during the term of this
Agreement or Employee's employment with Company and for a period following the
termination of this Agreement or Employee's employment, Employee should violate
the provisions of paragraph 4 of this Agreement. Further, Employee acknowledges
that any such violation would cause irreparable harm to Company and that Company
would be entitled, without limitation, to injunctive relief to remedy such
violation.
NOW, THEREFORE, in consideration of Ten Dollars ($10), and the mutual
promises, terms and conditions set forth herein and the performance of each, the
parties hereby agree as follows:
-1-
1. Services.
--------
(a) Company hereby employs Employee as a Vice President. Additional or
different duties, titles or positions may be assigned to Employee or may be
taken from Employee from time to time by the Chief Executive Officer or Chief
Operating Officer of the Company.
(b) Employee hereby accepts employment upon the terms and conditions
contained in this Agreement. Employee shall faithfully adhere to, execute and
fulfill all directions and policies established by the Company, to the extent
such instructions do not violate applicable laws.
(c) Employee shall not, during the term of his employment hereunder,
without the prior written consent of Company, be engaged in any other business
activity pursued for gain, profit or other pecuniary advantage, if such activity
interferes with Employee's duties and responsibilities under this Agreement.
Employee's employment is for a full-time position. Employee may make personal
investments in such form or manner as will neither require his services in the
operation or affairs of the enterprises in which such investments are made nor
violate the terms of Paragraph 4.
2. Compensation.
------------
(a) For all services to be rendered by Employee to Company, Company shall
pay Employee a salary computed at the rate of Ninety Thousand Dollars ($90,000)
per year, payable in accordance with Company's normal payroll procedures.
Although the salary is stated as an annual amount, the Employee shall earn and
be entitled to receive the salary in pro-rated amounts only for the periods the
Employee was employed by the Company.
(b) The Employee shall be granted stock options ("Options") exercisable
for Thirty-five Thousand (35,000) shares of the Company's common stock at a per
share exercise price equal to the lowest bid price of the stock on the NASDAQ
National Market System on the date of this Agreement. The Options shall be
granted under the Company's 1996 stock option plan. The Options shall vest over
the three-year term of this Agreement, one-third of the Options vesting on each
anniversary date of this Agreement. Notwithstanding the prior sentence, the
Options shall all vest immediately if the Company merges, consolidates or
consummates any other business combination in which the Company is not the
surviving entity.
-2-
(c) To the extent that Company, from time to time in its sole discretion,
offers or provides any of the following to its employees, then Employee, on an
equal basis with such other employees, shall be entitled to: (i) participation
in all, if any, life, health, medical, hospital, accident and disability
insurance programs of Company in existence for the benefit of its employees and
for which Employee qualifies; (ii) participation in all, if any, pension,
retirement, profit-sharing or stock purchase plans for which Employee qualifies;
(iii) participation in any other incentive compensation plans which Company
accords to its employees of a similar position to Employee, as determined by the
Board of Directors.
(d) During the term of Employee's employment with Company, Employee shall
be entitled to reimbursement for properly documented, reasonable business
expenses, including lodging and meals, incurred on behalf of Company, to the
extent that Company provides such reimbursement to its employees who are
employed in the same capacity as Employee. In addition, Employee shall be
entitled to an automobile allowance of $450 per month during the term of this
Agreement.
3. Term. The term of this Agreement shall begin on the date of this
----
Agreement and continue for a term of three (3) years.
4. Noncompetition Covenants.
------------------------
(a) Employee agrees that the noncompetition covenants contained in this
Paragraph 4 are a material and substantial part of this Agreement.
(b) Employee covenants that during Employee's employment with Company and
for two years following the termination of Employee's employment (regardless of
the reason for the termination) the Employee shall not, directly or indirectly,
without the prior express written consent of Company, do any of the things set
forth in items (i) through (v) below.
(i) call upon any person who is an employee of Company or its
affiliates in a managerial capacity, for the purpose or with the intent of
enticing such employee away from or out of the employ of Company or its
affiliates;
(ii) call upon any person or entity, which is, at that time, or
which has been, within one year prior to that time, a customer of the
Company for the purpose of soliciting or selling any of the services which
are the services offered by the Company;
-3-
(iii) call upon any prospective acquisition candidate on his own
behalf or on behalf of any competitor of Company or its affiliates, which
candidate was known to Employee as an acquisition candidate of the Company
or Company's affiliates;
(iv) disclose the identity of the customers of Company or its
affiliates, whether in existence or proposed, to any person, firm,
partnership, corporation or other entity whatsoever, for any reason or
purpose whatsoever, except if compelled to do so by a governmental agency,
Court Order or subpoena; or
(v) promote, or assist, financially or otherwise, any person, firm,
partnership, corporation or other entity whatsoever to do any of the above.
For the purposes of this Agreement, the term "affiliates" shall mean one or
more of: (a) each subsidiary of the Company, and (b) each other entity under
the direct or indirect control of the Company.
(c) The Company will sustain significant losses and damages as a result of
the breach by Employee of the covenants in this Paragraph 4. There is no
adequate monetary remedy for the immediate and irreparable damage that would be
caused to Company by Employee's breach of its non-competition covenants.
Employee agrees that, in the event of a breach by him of the foregoing
covenants, such covenants may be enforced by Company by, without limitation,
injunctions and restraining orders.
(d) It is agreed by the parties that the covenants in this Paragraph 4
impose a reasonable restraint on Employee in light of the activities and
business of Company on the date of the execution of this Agreement and the
future plans of Company.
(e) The covenants in this Paragraph 4 are severable and separate, and the
unenforceability of any specific covenant shall not affect the provisions of any
other covenant. If any court of competent jurisdiction shall determine that the
scope, time or territorial restrictions set forth are unreasonable, then it is
the intention of the parties that such restrictions be enforced to the fullest
extent which the court deems reasonable, and the Agreement shall thereby be
reformed.
(f) The covenants in this Paragraph 4 shall be construed as independent of
any other provision of this Agreement and the existence of any claim or cause of
action of Employee against Company whether predicated on this Agreement, or
otherwise, shall not constitute a
-4-
defense to the enforcement by Company of such covenants. It is specifically
agreed that the duration of the noncompetition covenants stated above shall be
computed by excluding from such computation all time during which Employee is in
violation of any provision of this Paragraph 4 and all time during which there
is pending in any court of competent jurisdiction any action (including any
appeal from any judgment) brought by any person, whether or not a party to this
Agreement, in which action Company seeks to enforce the agreements and covenants
of Employee or in which any person contests the validity of such agreements and
covenants or their enforceability or seeks to avoid their performance or
enforcement. Provided that, no such exclusion shall include the period of time
within which Employee has ceased violating this paragraph, whether or not as a
result of being in compliance with Court injunction or doing so voluntarily, and
whether or not any action is pending against Employee.
5. Return of Company Property. All correspondence, reports, charts,
--------------------------
products, records, designs, patents, plans, manuals, "field guides," memoranda,
advertising materials, lists and other data or property collected by or
delivered to Employee by or on behalf of the Company or its representatives,
customers and government entities (including, without limitation, customers
obtained for Company by Employee), and all other materials compiled by Employee
which pertain to the business of Company shall be and shall remain the property
of Company, shall be subject at all times to the Company's discretion and
control and shall be delivered promptly to Company upon request at any time and
without request upon completion or other termination of Employee's employment
hereunder.
6. Termination; Rights of Termination. Employee's employment under
----------------------------------
this Agreement may be terminated during the term hereof in any one or more of
the following ways:
(a) Automatically upon the death or resignation of Employee.
(b) By Company upon written notice to Employee upon:
(i) Employee's unsatisfactory performance of his duties or other
obligations hereunder, as determined in good faith by the Company;
(ii) The Company's merger, consolidation, or other business
combination with another entity where the Company is not the surviving
entity or the Company's sale of substantially all its assets;
-5-
(iii) Employee's breach of this Agreement;
(iv) Employee's inability to perform his duties under this Agreement
because of illness or physical or mental disability or other incapacity
which continues for a period of 30 days or more;
(v) Any incident or circumstance where Employee is determined to be
involved in any one or more of the following: (1) alcohol abuse or use of
controlled substances during employment hours, (2) conduct of Employee
involving insubordination toward more senior officers of the Company, (3)
any type of harassment, violence or threat thereof, or other behavior
toward other employees of the Company or toward third parties of a kind
that may tend to result in liability being incurred by the Company toward
such employee or third party, (4) any type of disloyalty to the Company or
any of its affiliates or subsidiaries, (5) gross negligence or willful
misconduct with respect to the Company or any of its affiliates or
subsidiaries, including without limitation fraud, embezzlement, theft or
proven dishonesty in the course of his employment, or (6) a conviction of
any felony or a misdemeanor involving moral turpitude or the entering of a
plea of guilty or nolo contendere to a felony.
---- ----------
If the Agreement is terminated by the Company, the Employee shall be provided
with a written notice of termination which shall state the reason for Employee's
termination.
(c) Upon termination of Employee's employment under Paragraph 6(b)(i),
Employee shall be entitled to receive, and shall immediately be paid in full, an
amount equal to the pro-rated salary for three months. Upon termination of
Employee's employment under Paragraph 6(b)(ii), Employee shall be entitled to
receive, and shall immediately be paid in full, an amount equal to one year's
salary.
(d) In the event of termination of Employee's employment under this
Agreement for any reason provided in paragraph 6(a) or 6(b), all rights and
obligations of Company and Employee under this Agreement shall cease
immediately, except that Employee's obligations under this subparagraph and
paragraphs 4, 5, and 7 herein and Company's obligations under paragraph 6(a) or
6(c) shall survive such termination. After such termination, Employee shall
have no right to receive any compensation hereunder, except as set forth in
paragraph 6(a) or 6(c).
-6-
7. Representations of Employee. Employee represents and warrants to
---------------------------
Company that he is not subject to any restriction or noncompetition covenant in
favor of a former employer or any other person or entity, and that the execution
of this Agreement by Employee and his provision of services to Company and the
performance of his obligations hereunder will not violate or be a breach of any
agreement with a former employer or any other person or entity. Further,
Employee agrees to indemnify Company for any claim, including, but not limited
to, attorneys' fees and expenses of investigation, by any such third party that
such third party may now have or may hereafter come to have against Company
based upon or arising out of any noncompetition agreement or invention and
secrecy agreement between Employee and such third party.
8. Complete Agreement. This Agreement is the final, complete and
------------------
exclusive statement and expression of the agreement between Company and
employee, it being understood that there are no oral representations,
understandings or agreements covering the same subject matter as this Agreement.
This Agreement supersedes, and cannot be varied, contradicted or supplemented by
evidence of any prior or contemporaneous discussions, correspondence, or oral or
written agreements of any kind. This Agreement may be modified, altered or
otherwise amended only by a written instrument executed by both Company and
Employee.
9. No Waiver; Remedies Cumulative. No waiver by the parties hereto of
------------------------------
any default or breach of any term, condition or covenant of this Agreement shall
be deemed to e a waiver of any subsequent default or breach of the same or any
other term, condition or covenant contained herein. No right, remedy or election
given by any term of this Agreement shall be deemed exclusive but each shall be
cumulative with all other rights, remedies and elections available at law or in
equity.
10. Assignment; Binding Effect. Employee understands that he has been
--------------------------
selected by Company on the basis of his personal qualifications, experience and
skills. This Agreement is not assignable. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and Company's successors.
11. Notice. All notices or other communications required or permitted
------
hereunder shall be in writing and may be given by depositing the same in the
United States mail, addressed to the party to be notified, postage prepaid and
registered or certified with return receipt requested, by overnight courier or
by delivering the same in person to such party.
-7-
To Company: President
0000 Xxxxxxxx Xxxxx
Xx. Xxxxxx, Xxx Xxxxxx 00000
with a copy to:
Xxxxxx X. Xxxxxx & Associates, P.C.
0000 Xxxxx Xxxxxx, Xxxxx 000
Xxxx xx Xxxxxxx, Xxxxxxxxxxxx 00000
To Employee: Xxxx Xxxxxx
0000 Xxxxxxx Xxxx
Xxxx Xxxxxxx, Xxxxxxxxxxxx 00000
Notice shall be deemed given and effective the day personally delivered, the day
after being sent by overnight courier and three days after the deposit in the U.
S. mail of a writing addressed as above and sent first class mail, certified,
return receipt requested, or when actually received, if earlier. Either party
may change the address for notice by notifying the other party of such change in
accordance with this paragraph 11.
12. Severability; Headings. If any portion of this Agreement is held
----------------------
invalid or inoperative, the other portions of this Agreement shall be deemed
valid and operative and, so far as is reasonable and possible, effect shall be
given to the intent manifested by the portion held invalid or inoperative. The
paragraph headings herein are for reference purposes only and are not intended
in any way to describe, interpret, define or limit the extent or intent of this
Agreement or of any part hereof.
14. Governing Law. This Agreement shall in all respects be construed in
-------------
accordance with the laws of the State of New Jersey.
EASTERN ENVIRONMENTAL SERVICES, INC.
-8-
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Xxxxxx X. Xxxxxx, Vice President
/s/ Xxxx Xxxxxx
---------------------------------------
Xxxx Xxxxxx
-9-
