Exhibit 99.3
EMPLOYMENT AGREEMENT
This Agreement is made and entered into as of the 29th day of
September, 1999 by and between UNITED XXXXXXX CORPORATION, a
Colorado corporation (the "Employer"), and XXXXXX X. XXXXXXXX (the
"Executive").
WHEREAS, the Employer desires to employ the Executive on the terms
and conditions set forth in this Agreement and the Executive is
willing to accept such employment.
NOW, THEREFORE, in consideration of the mutual covenants and
promises set forth in this Agreement, the Employer and Executive,
intending to be legally bound, agree as follows:
1. Employment: The Employer hereby employs the Executive, and the
Executive hereby accepts employment, upon the terms and conditions
set forth in this Agreement. The relationship between the Executive
and Employer is that of employee and employer.
2. Term: Subject to the provisions for termination set forth in
this Agreement, the term of this Agreement shall be for a period of
five (5) years, beginning on the date of the acquisition of
Pittsfield Mold & Tool, Inc. ("PMT") by United Xxxxxxx Corporation.
3. Compensation: For all services rendered by the Executive under
this Agreement, the Employer shall pay Executive during the term of
this Agreement an annual base salary of $125,000.00, payable in
equal installments in accordance with the normal payroll practices
of PMT. All payments made pursuant to this Section 3 shall be
subject to withholding and other applicable taxes. Executive's base
salary shall be reviewed at least annually, commencing with a review
in the eleventh month subsequent to the effective date of this
Agreement, and may be adjusted from time to time in the sole
discretion of the Board of Directors of Employer, but in no event
will it be adjusted to an amount lower than $125,000.00 per year.
4. Fringe Benefits: The Executive shall be entitled to the same
fringe benefits as are offered, from time to time, to other
employees of Employer who are employed in positions similar to that
of Executive.
5. Duties: The Executive is engaged as the President of PMT and
shall perform such services and assume and discharge such
responsibilities, which are commensurate with his position, as the
Employer, in its reasonable discretion, may, from time to time,
require of, or assign to Executive. The Executive shall not
delegate the duties and responsibilities which are vested in him.
He, nevertheless, may utilize and delegate to such individuals who
may also be employed by the Employer those tasks which he deems
necessary or appropriate to help him carry out the duties and
responsibilities assigned to him as an employee of the Employer,
except that he shall remain accountable for such tasks to the
Employer. Executive further agrees that he shall devote
substantially his full time, energy and best efforts to the business
of the Employer during the hours that the business remains open and
such additional time as is reasonably necessary to complete
Executive's tasks. Executive agrees to exercise his best efforts,
judgment, skills and talents in performing his duties and, in
general, to comply with the policies and be subject to the direction
of the Board of Directors of PMT.
6. Direction of Services: The Employer shall direct, control and
supervise the duties and work of Executive; provided, however, that
the Employer shall not impose employment duties or constraints of
any kind which would require Executive to violate any ordinance or
law.
7. Exclusive Services: The Executive shall devote his entire
business time, attention and energies to the business of the
Employer, and shall not during the term of this Agreement, either
directly or indirectly, engage in any other professional or business
whether or not such business activity is pursued for gain, profit,
or other pecuniary advantage to which the Executive would be giving
of his time and effort to the detriment of Employer; but this shall
not be construed as preventing the Executive from investing his
assets in such form or manner as will not require any substantial
services on the part of the Executive in the operation of the
affairs of the companies in which such investments are made;
provided, however, that no such investment shall be made in any
company which competes with Employer in any aspect of the injection
molding industry, except that Executive shall be able to invest in
any such public company provided such investment does not exceed
five (5%) percent of such company's issued and outstanding shares.
8. Working Facilities: The Executive shall be furnished, at the
expense of the Employer, with all necessary facilities and equipment
for performing his services hereunder.
9. Disclosure of Information:
(a) (i) Executive acknowledges that as a result of his employment
by Employer, he will be making use of, acquiring and/or adding to
confidential information of a special and unique nature and value
relating to Employer's intellectual property, proprietary
information, trade secrets, systems, procedures, manuals,
confidential reports and customer list and all information related
to customer lists and customer sales and service (the "Confidential
Information"). As a material inducement to Employer to enter into
this Agreement and to pay Executive the compensation set forth in
this Agreement, Executive covenants and agrees that, except as
authorized by Employer, so long as he receives his Residual Salary
(hereinafter defined), he shall not, for a period of one year
following the term of this Agreement, directly or indirectly,
divulge or disclose for any purpose whatsoever any Confidential
Information unless Executive's employment is terminated by Executive
pursuant to Section 14 (a) (ii) or by Employer pursuant to Section
14 (b) or pursuant to Section 14 (c) (ii), in which case, Executive
shall be under no such duty not to disclose the Confidential
Information. Executive acknowledges that unauthorized disclosure or
misuse of the Confidential Information will cause irreparable damage
to the Employer. Employer and Executive also agree that covenants
by Executive not to make unauthorized disclosures of the
Confidential Information are essential to the growth and stability
of the Employer. Accordingly, Executive agrees to the
confidentiality covenants in this Section of the Agreement.
Confidential Information shall not include information which (i) is
or becomes generally available to the public other than as a result
of a disclosure by the Executive; or, (ii) is or becomes available
to the Executive on a non-confidential basis from a source other
than the Employer provided such source is not, to the knowledge of
the Executive, bound by a confidentiality agreement with the
Employer.
(ii) Because a remedy at law for any breach of the provisions of
this Section may be inadequate, in addition to any and all other
remedies available to Employer, Employer shall have the remedies of
a restraining order, injunction or other equitable relief to enforce
the provisions hereof.
(iii) Executive acknowledges, warrants, represents and agrees that
the confidentiality covenants contained in this Section are
necessary for the protection of the Employer's legitimate business
interests and are reasonable in scope and content, and Executive
represents and warrants that his attorney has thoroughly and
completely reviewed this Agreement with him, and he understands the
contents hereof.
(b) Executive agrees to indemnify and hold Employer harmless from
any loss, cost or expense incurred by the Employer arising out of
any material breach of the agreements set forth in this Section or
the fact that any material representation made by Executive in this
Agreement was false when made. It is further understood and agreed
that in the event there is a material breach of any of the
provisions set forth above, all obligations of Employer shall end,
and Executive's employment with the Employer may be terminated
immediately.
10. Expenses: Executive may, from time to time, incur reasonable
expenses for promoting the business of Employer, including expenses
for entertainment, travel and similar items. In such instances, the
Employer will reimburse the Executive upon submission of an itemized
account of such expenditures.
11. Vacations: Executive shall be entitled to a vacation of four
(4) weeks per year during the term of this Agreement during which
time his compensation shall be paid in full.
12. Stock Option Grant: The Employer shall grant to Executive an
option to purchase 40,000 shares of common stock of United Xxxxxxx
Corporation with an exercise price of $1.00 per share, which stock
option grant shall vest in equal annual installments over the term
of this Agreement. The Executive shall participate in future stock
option grants as determined by the Board of Directors of United
Xxxxxxx Corporation.
13. Incentive Bonus: The Employer shall pay to Executive an
incentive bonus based on earnings before interest, taxes,
depreciation and amortization ("EBITDA"). The Year 1 incentive
bonus will be equal to thirty (30%) percent of Executives annual
base salary if EBITDA exceeds $1.7 million; and for every
$100,000.00 increase in EBITDA above $1.7 million, an additional
five (5%) percent of annual base salary will be paid, up to a
maximum incentive bonus of fifty (50%) of annual base salary.
14. Termination of Employment:
(a) (i) The Employer may terminate this Agreement and Executive's
employment at any time for cause which shall include, but not be
limited to, (a) Executive's fraud, felony conviction (whether or not
employment related), misappropriation, embezzlement or the like, or
(b) for willful or gross neglect of his duties hereunder in any
material respect, or if Executive violates any of the provisions
hereunder in any material respect which neglect is not cured by the
Executive to the Employer's reasonable satisfaction within a period
of thirty (30) days following the Executive's receipt of written
notice from the Employer making specific reference to this Section
14 (a) (i) and, (b) and stating with particularity all alleged
actions or omissions in the Executive's service being relied upon by
the Employer hereunder.
(ii) Executive may terminate this Agreement and his employment, if
(a) the Employer requires Executive to relocate more than fifty (50)
miles from the current location of Executive's branch of Employer;
or (b) there is a material and adverse change in Executive's
position, duties, responsibilities or status with the Employer, a
material reduction in Executive's salary or benefits, other than a
reduction in salary or benefits comparable to reductions generally
applicable to similarly situated employees of the Employer; or the
Employer violates any of the provisions of this Agreement in any
material respect and such change, reduction or violation is not
cured to the Executive's reasonable satisfaction within a period of
thirty (30) days following the Employer's receipt of written notice
from the Executive making specific reference to this Section 14 (a)
(ii) (b) and stating with particularity all alleged actions or
omissions of the Employer being relied upon by the Executive
hereunder; or if (c) there is a "USC Default" as that term is
defined per a certain Cross-Default and Cross-Collateral Agreement
of even date executed by Employer, Xxxxx X. Xxxxxxxx and Xxxxxxx X.
Xxxxxxxx, et. al.; or if (d) there is a "Change of Control". A
Change of Control of PMT shall be deemed to have occurred if: (i)
any "person" (as such term is used in Section 13 (d) and 14 (d) (2)
of the Securities Exchange Act of 1934, as amended) other than
United Xxxxxxx Corporation becomes the beneficial owner, directly or
indirectly, of securities of PMT representing more than fifty (50%)
percent of the aggregate voting power of all classes of PMT's then
outstanding voting securities; or (ii) the shareholder(s) of PMT
approve(s) (A) a plan of merger, consolidation or share exchange
between PMT and any person or entity other than a merger,
consolidation or other business combination with USC or with another
wholly-owned subsidiary of USC, or (B) a proposal with respect to
the sale, lease, exchange or other disposal of all, or substantially
all, of PMT's property.
(b) The Employer or Executive may terminate this Agreement without
cause upon ninety (90) days written notice to the other party.
(c) This Agreement shall also be terminated (i) by the mutual
agreement of Employer and Executive; (ii) by the dissolution and
liquidation of Employer (other than as part of a reorganization,
merger, consolidation, or sale of all or substantially all of the
assets of Employer through which the business of the Employer is
continued); and, (iii) by the total or complete disability of the
Executive for more than ninety (90) consecutive days.
(d) If this Agreement is terminated by Employer pursuant to Section
14 (a) (i), by Executive pursuant to Section 14 (b) or pursuant to
Section 14 (c) (i), Executive shall be paid only such amounts as are
accrued under Sections 3, 4 and 11, but are unpaid as of the date of
termination. Payment pursuant to this Section 14 (d) shall be made
to Executive as soon as practicable, and shall be subject to
withholding and other applicable taxes.
(e) If this Agreement is terminated by Executive pursuant to Section
14 (a) (ii), by Employer pursuant to Section 14 (b), or pursuant to
Section 14 (c) (ii), or Section 14 (c) (iii), Executive shall
receive severance pay in the amount equal to six (6) month's then
current salary. Payments pursuant to this Section 14 (e) shall
continue to be made by Employer in equal monthly installments, and
shall be subject to withholding and other applicable taxes.
(f) In the event of termination of this Agreement for any reason,
Executive agrees to resign from all positions held in Employer or
any of its affiliate or subsidiary companies, including, without
limitation, any position as a director, officer, trustee or
consultant.
15. Restrictive Covenants:
(a) For a period of one (1) year after termination by Employer
pursuant to Section 14 (a) (i), or by Executive pursuant to Section
14 (b), or pursuant to Section 14 (c) (i), or pursuant to Section 14
(c) (iii) of this Agreement, the Executive shall not, directly or
indirectly, (i) own, manage, operate, control, direct, be employed
by, participate in, or be connected in any manner with the
ownership, management, operation, direction or control of any
business which competes with the business conducted by the Employer
at the time of the termination of this Agreement; (ii) solicit any
of Employer's customers; or (iii) solicit for employment any of
Employer's employees.
(b) For a period of one (1) year after the expiration of this
Agreement, the Executive shall not, directly or indirectly, (i) own,
manage, operate, control, direct, be employed by, participate in, or
be connected in any manner with the ownership, management,
operation, direction or control of any business which competes with
the business conducted by the Employer at the time of the
termination of this Agreement; (ii) solicit any of Employer's
customers; or (iii) solicit for employment any of Employer's
employees, provided Employer pays Executive an amount equal to one
(1) year's then current salary, payable in equal monthly
installments, subject to withholding and other applicable taxes
("Residual Salary") and, provided further, that a USC Default does
not occur during such period.
(c) Executive acknowledges that the foregoing time and other
limitations are reasonable and properly required for the adequate
protection of the business affairs of the Employer, and in the event
any such limitation is found to be unreasonable by a Court of
competent jurisdiction, Executive agrees and submits to the
reduction of said limitation to such an area, time or other
limitation or otherwise as the Court may determine to be reasonable.
In the event that any limitation under this Section is found to be
unreasonable or otherwise invalid in any jurisdiction, in whole or
in part, Executive acknowledges, warrants, represents, and agrees
that such limitation shall nevertheless be valid in all other
jurisdictions.
(d) Executive acknowledges, warrants, represents, and agrees that
the restrictive covenants contained in this Section are reasonable
and necessary for the protection of the Employer's legitimate
business interests and are reasonable in scope and content and
represents and warrants that Executive's attorney has reviewed this
Agreement with Executive and Executive understands the contents of
these restrictive covenants.
(e) Because a remedy at law for any breach of the provisions of this
Section will be inadequate, in addition to any and all other
remedies available to the Employer, the Employer shall have the
remedies of a restraining order, injunction or other equitable
relief to enforce the provisions hereof.
16. Death During Employment: If the Executive dies during the term
of his employment hereunder, the Employer shall pay to the estate of
the Executive the compensation, if any, accrued but unpaid to the
date of death.
17. Notices: Any notice required or permitted to be given under
this Agreement shall be sufficient if in writing, and if sent by
certified or registered mail or personally delivered to his
residence in the case of the Executive or to its principal place of
business in the case of the Employer. Either party, by notice to
the other, may change the address to which further notice is to be
sent to such party.
18. Waiver of Breach: The waiver by either party of a breach of any
provisions of this Agreement by the other party shall not operate or
be construed as a waiver of any subsequent breach.
19. Assignment: The rights and obligations of the Employer and
Executive under this Agreement are of a personal nature and,
therefore, this Agreement and the rights and obligations of the
parties are not assignable by either party, without the prior
written consent of the other party.
20. Entire Agreement; Amendments: This Agreement contains the
entire agreement of the parties. This Agreement may be amended at
any time by mutual consent of the parties provided, however, that no
such amendment shall be valid or enforceable unless set forth in
writing and signed by Employer and Executive.
21. Applicable Laws: This Agreement shall be interpreted and
enforced in accordance with the laws of the State of Massachusetts.
22. Severability: The invalidity or unenforceability of any
provision in the Agreement shall not in any way affect the validity
of enforceability of any other provision and this Agreement shall be
construed in all respects as if such invalid or unenforceable
provision had never been in the Agreement.
23. Headings: The various headings in this Agreement are inserted
for convenience only and are not part of the Agreement.
24. Expenses: All expenses, including reasonable attorney's fees
and expenses, arising out of claims under this Agreement, shall be
borne by the losing party to the fullest extent permitted by law.
IN WITNESS WHEREOF, Employer and Executive have executed this
Agreement as of the 29th day of September, 1999.
UNITED XXXXXXX CORPORATION EXECUTIVE
By /s/ Xxxxxx X. Xxxxxxxxx, Xx. /s/ Xxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxxx, Xx. Xxxxxx X. Xxxxxxxx
President and Chief Operating Officer
