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EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is executed and delivered as
of October 9, 1998, by and between EarthCare Company a Delaware corporation
("Company"), and Xxxxx Xxxxxxx, an individual ("Employee").
RECITALS
The Company is a comprehensive, national service company catering to
the non-hazardous liquid waste customer. The Company's services include grease
trap pumping, septic (including pumping, installation and maintenance),
portable toilets, biosolids management, bulk liquid waste services and liquid
waste processing and disposal services. The Company desires to hire Employee as
Vice President and Chief Financial Officer 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
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this Agreement or Employee's employment, Employee should violate the provisions
of Paragraph 3 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. Services
(a) Company hereby employs Employee as its Vice-President and Chief
Financial Officer.
Additional or different duties, titles or positions may be assigned to Employee
or may be taken from Employee from time to time by the Board of Directors of
the Company; provided, that the Employee consents to such changes.
(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 may, 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 does
not interfere with Employee's duties and responsibilities under this Agreement.
Employee may make personal investments in such form or manner as will neither
require any material amount of his services in the operation or affairs of the
enterprises in which such investments are made nor violate the terms of
Paragraph 3.
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2. Compensation
(a) For all services to be rendered by Employee to Company, Company
shall pay Employee an annual salary at the rate of Ninety-Five Thousand Dollars
($95,000) per year, payable monthly, in advance. The Company, at its
discretion, may from time to time grant bonuses and raises to the Employee, as
determined by the Company's Compensation Committee.
(b) Employee has been granted stock options ("Options") exercisable
for shares of the Company's common stock as reflected on Schedule A, attached
hereto. In addition, the Employee may be granted additional Options in the
future in accordance with any plans to issue options adopted by the Company.
Except as hereinafter provided, one fourth of the Options shall vest on each
anniversary date of this Agreement. Notwithstanding the prior sentence the
Options shall all vest immediately, if the Company's Board of Directors accepts
a binding agreement of merger, consolidation or other business combination with
any other publicly traded company or with any private company in which the
Company is not the surviving entity. In addition, all Options shall vest
immediately on the death of Employee and will be paid to Employee's estate or
designated beneficiary.
(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, and (iii) participation in any other employee benefits which Company
accords to its employees.
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(d) During the term of Employee's employment with Company, Employee
shall be entitled to reimbursement for reasonable business expenses incurred on
behalf of Company. Employee shall receive an automobile allowance in the amount
of $450.00 per month.
3. Noncompetition Covenants. (a) Employee agrees that the
noncompetition covenants contained in this Paragraph 3 are a material and
substantial part of this Agreement.
(b) Employee covenants that during Employee's employment with Company
and for one year 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 item (i) below. 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 (ii) through (vi)
below. In addition all options shall vest immediately on the death of Employee.
(i) engage, as an officer, director, shareholder, owner, partner,
joint venturer, agent, or in a managerial capacity, whether as an employee,
independent contractor, consultant, or advisor, or as a sales representative,
in the liquid waste disposal industry, within seventy-five (75) miles of any
Company business operation at the date of Employee's termination (the
"Territory");
(ii) call upon any person who is, at that time, within the Territory,
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;
(iii) call upon any person or entity, which is, at that time, or which
has been, within one year
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prior to that time, a customer of the company or its affiliates within the
Territory, for the purpose of soliciting or selling any of the services which
are the services offered by the Company within the Territory;
(iv) call upon any prospective acquisition candidate located within the
Territory, 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's or Company's affiliates;
(v) 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 to do so by a governmental agency, Court Order or subpoena; or
(vi) promote, or assist, financially or otherwise, any person, firm,
partnership, corporation or other entity whatsoever to do any of the above.
Notwithstanding the above, the foregoing covenant shall not be deemed to
prohibit Employee from acquiring as an investment not more than two percent of
the capital stock of a competing business, the stock of which is traded on a
national securities exchange or over-the-counter.
For the purposes of this Agreement, the term "affiliates" shall mean
one or more of: (a) each subsidiary of 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 3. 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.
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(d) It is agreed by the parties that the covenants in this Paragraph 3
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 future
plans of Company.
(e) The covenants in this Paragraph 3 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 3 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 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 3 and all time during which there is pending in any court of
competent jurisdiction any action (including any appeal from any judgement)
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.
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4. 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.
5. Inventions. Employee shall disclose promptly to Company any and all
conceptions and ideas for invention, improvements, and valuable discoveries,
whether patentable or not, which are conceived or made by Employee solely or
jointly with another during the period of employment or within one year
thereafter and which are related to the business or activities of the Company.
Employee hereby assigns and agrees to assign all his interests therein to
Company or its nominee. Whenever requested to do so by Company, Employee shall
execute any and all applications, assignments or other instruments that Company
shall deem necessary to apply for and obtain Letters Patent of the United
States or any foreign country or to otherwise protect Company's interest
therein. These obligations shall continue beyond the termination of employment
with respect to inventions, improvements and valuable discoveries, whether
patentable or not, conceived, made or acquired by Employee during the period of
employment or within one year thereafter, and shall be binding upon Employee's
heirs, assigns, executors, administrators and other legal representatives.
6. Term; Termination; Rights of Termination. The term of this
Agreement shall begin on the date of this Agreement and continue for a term of
2 years. In the event of termination
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of Employee's employment, Employee's obligations under Paragraph 3, 4, 5 and 9
hereof shall survive such termination. Employee's employment under this
Agreement may be terminated without cause during the term hereof or in any one
or more of the following ways:
(a) Automatically upon the resignation of Employee.
(b) By Company upon written notice to Employee in the event of:
(i) Employee's material breach of this Agreement unsatisfactory
performance of his duties or other obligations hereunder, as determined in good
faith by the Board of Directors of the Company;
(ii) The Company's merger, consolidation, or other business
combination with another publicly traded entity or with a private entity where
the Company is not the surviving entity or the Company's sale of substantially
all its assets;
(iii) 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 90 days; or
(iv) Employee's conviction for fraud with respect to the business
or affairs of Company or if Employee if convected of a felony with respect to
the business or affairs of Company.
(c) Upon termination of Employee's employment without cause, Employee
shall be entitled to receive all compensation to the date of such termination
plus severance pay equal to three (3) months salary. In addition, upon
termination without cause, Employee shall be entitled to all Options vested as
of the termination date. All Options which have not vested as of the
termination date shall lapse and become null and void.
7. Authority. Employee shall have such authority as is commensurate
with his position as Chief Financial Officer.
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8. Representations of Employee and Employer. 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.
9. 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.
10. 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 be 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.
11. Assignment; Binding Effect Employee understands that he has been
selected by
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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.
12. 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.
To Company: Xxxxxx X. Xxxxxxxxx, Xx.
0 Xxxxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
with a copy to : Xxxxxx X. Xxxx, Esq.
00000 Xxxx Xxxxxx Xxxxx
Xxxxxxxx Xxxx, XX 00000
To Employee: Xxxxx Xxxxxxx
0000 Xxx Xxxxxx Xxxxx
Xxxxx, XX 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 12.
13. Severability; Headings. If any portion of this Agreement is held
invalid or inoperative, the other portion of this Agreement shall be deemed
valid and operative and, so far as is reasonable
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and possible, effect shall be given to the intent manifested by the portion
held invalid or inoperative. The paragraph headings herein are for reference
purposed 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 constructed
in accordance with the laws of Texas.
EarthCare Company
By:
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Xxxxx Xxxxxxx
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