EXECUTIVE EMPLOYMENT AGREEMENT
EXHIBIT 10.31
THIS EXECUTIVE EMPLOYMENT AGREEMENT
(“Agreement”) is effective August 1, 2008, by
and between Xxxxx XxXxxxxxx (“Executive”) and
ABM Industries Incorporated, a Delaware corporation
(“Company” or “ABM”).
1. EMPLOYMENT. In consideration of the
terms and commitments contained in this agreement, Executive
agrees to and acknowledges the following:
2. TERM, RESPONSIBILITIES AND TITLE. This
agreement shall end on October 31, 2010, unless sooner
terminated pursuant to Section 7 (“Initial
Term”). Employment may be extended pursuant to
Section 6 (“Extended Term”). Executive shall
assume and perform such duties, functions and responsibilities
relating to Executive’s employment with Company as may be
assigned from time to time by the Company. Executive’s
title shall be Senior Vice President, General Counsel and
Corporate Secretary of Company, subject to modification as
determined by the Company’s Board of Directors
(“Board”).
3. COMPENSATION. Company agrees to
compensate Executive, and Executive agrees to accept as
compensation in full, a base salary. Employee will also be
eligible for short-term incentive awards pursuant to the terms
of the Performance Incentive Program (“Bonus”), to
participate in the 2006 Equity Incentive Program and for such
perquisites as are from time to time received by similarly
situated executives.
4. COMPLIANCE WITH LAWS AND
POLICIES. Executive shall dedicate
his/her full
business time and attention to the performance of duties
hereunder, perform
his/her
duties in good faith and to a professional standard, and fully
comply with all laws and regulations pertaining to the
performance of this Agreement, all ethical rules, ABM’s
Code of Business Conduct and Ethics as well as any and all of
policies, procedures and instructions of Company.
5. RESTRICTIVE COVENANTS. In
consideration of the compensation, contract term, potential
Severance Benefits, continued employment provided by Company,
and access to Proprietary Information, as defined below,
necessary to the performance of Executive’s duties
hereunder, Executive hereby agrees to the following during
his/her
employment and thereafter as provided:
5.1 NON-DISCLOSURE. Except in the proper
performance of this Agreement, Executive agrees to hold all
Proprietary Information in the strictest confidence, and to
refrain from making any unauthorized use or disclosure of such
information both during Executive’s employment and at all
times thereafter. Executive shall not directly or indirectly
disclose, reveal, transfer or deliver to any other person or
business, any Proprietary Information which was obtained
directly or indirectly by Executive from, or for, Company or by
virtue of Executive’s employment with Company.
“Proprietary Information” means Company’s trade
secrets, ideas, processes and other confidential information not
generally known that could have value to a third party such as
plans for business development, marketing, business plans,
budgets and financial statements of any kind, costs and
suppliers, and information regarding the skills and compensation
of other employees of the Company or employees of any company
that contracts to provide services to the Company. Proprietary
Information also includes information of third parties to which
Executive had access by virtue of employment with the Company,
including, but not limited to, information regarding customers
such as: (i) the identity of Company’s customers,
customer contacts, and sales prospects; (ii) the nature,
extent, frequency, methodology, cost, price and profit
associated with services and products purchased by customers
from Company; (iii) the names, office hours, telephone
numbers and street addresses of its purchasing agents or other
buyers or customer contacts; (iv) Company and customer
billing procedures; (v) Company and customer credit limits
and payment practices; (vi) Company and customer
organizational structure; and (vii) any information related
to past, current or future acquisitions between Company or
Company-affiliated entities including Company information used
or relied upon for said acquisition.
5.2 NON-SOLICITATION OF
EMPLOYEES. Executive acknowledges and agrees that
during the course of Executive’s employment with Company,
Executive will come into contact with Company employees and
acquire information regarding their knowledge, skills,
abilities, salaries, commissions, benefits, and other matters
that are not generally known to the public. Executive further
acknowledges and agrees that hiring, recruiting, soliciting, or
inducing the termination of such employees will be detrimental
and harmful to Company’s business. Accordingly, Executive
agrees that while employed by Company and for a period of one
year following the termination of Executive’s employment
(whether termination is voluntary or involuntary), Executive
will not directly or indirectly
solicit, hire, recruit or otherwise encourage or arrange for any
executive or employee to terminate employment with Company or
any other Company-affiliated entity except in the proper
performance of this Agreement. This prohibition against
solicitation shall include but not be limited to:
(i) identifying to other employers or their agents,
recruiting or staffing firms, or other third parties the Company
employee(s) who have specialized knowledge concerning
inventions, processes, methods, or other confidential affairs or
who have contacts, experience, or relationships with particular
customers; (ii) disclosing or commenting to other employers
or their agents, recruiting or staffing firms, or other third
parties regarding the quality or quantity of work, specialized
knowledge, or personal characteristics of any person still
employed by Company or any other Company-affiliated entity; and
(iii) providing such information to prospective employers
or their agents, recruiting or staffing firms, or other third
parties preceding possible employment.
5.3 NON-SOLICITATION OF
CUSTOMERS. Executive agrees that during and for
one year following the termination of Executive’s
employment with Company (whether such termination is voluntary
or involuntary), Executive shall not, directly or indirectly,
for the benefit of any person or entity other than the Company,
seek, solicit, divert, take away, obtain or accept work from any
customer or prospective customer. In addition, Executive agrees
that at all times after the voluntary or involuntary termination
of Executive’s employment, Executive shall not seek,
solicit, divert, take away, obtain, or accept work from of any
customer or sales prospect of Company or any other
Company-affiliated entity through the direct or indirect use of
any Proprietary Information or by any other unfair or unlawful
business practice.
5.4 POST EMPLOYMENT
COMPETITION. Executive agrees that while employed
by Company and, to the fullest extent allowed by law, for a
period of one year following Executive’s termination of
employment (whether such termination is voluntary or
involuntary), Executive shall not engage in any business
activity which competes directly or indirectly with the Company
or the operations of any Company-affiliated entity regarding
which Executive had information or knowledge. The Executive
acknowledges that the Company and its subsidiaries are engaged
in business in various states throughout the U.S. and that
the Company intends to expand the geographic scope of its
activities. Accordingly and in view of the nature of
Executive’s position and responsibilities, the Executive
agrees that the provisions of this Section shall be applicable
to each state and each foreign country in which the Company may
be engaged in business within the twelve-month period preceding
the effective date of Executive’s termination of employment.
5.5 NON-DISPARAGEMENT. During
Executive’s employment with Company and thereafter,
Executive agrees not to make any statement or take any action
which disparages, defames, or places in a negative light
Company, Company-affiliated entities, or its or their
reputation, goodwill, commercial interests or past and present
officers, directors and employees.
5.6 COOPERATION WITH LEGAL
MATTERS. During Executive’s employment with
Company and thereafter, Executive shall cooperate with Company
and any Company-affiliated entity in its or their investigation,
defense or prosecution of any potential, current or future legal
matter in any forum, including but not limited to lawsuits,
administrative charges, audits, arbitrations, and internal and
external investigations. Executive’s cooperation shall
include, but is not limited to, reviewing and preparing
documents and reports, meeting with attorneys representing any
Company-affiliated entity, providing truthful testimony, and
communicating Executive’s knowledge of relevant facts to
any attorneys, experts, consultants, investigators, employees or
other representatives working on behalf of an Company-affiliated
entity. Except as required by law, Executive agrees to treat all
information regarding any such actual or potential investigation
or claim as confidential. Executive also agrees not to discuss
or assist in any litigation, potential litigation, claim, or
potential claim with any individual (or their attorney or
investigator) who is pursuing, or considering pursuing, any
claims against the Company or a Company-affiliated entity unless
required by law. In performing the tasks outlined in this
Section 5.6, Executive shall be bound by the covenants of
good faith and veracity set forth in ABM’s Code of Business
Conduct and Ethics and by all legal obligations. Nothing herein
is intended to prevent Executive from complying in good faith
with any subpoena or other affirmative legal obligation.
Executive agrees to notify the Company immediately in the event
there is a request for information or inquiry pertaining to the
Company, any Company-affiliated entity, or Executive’s
knowledge of or employment with the Company. In performing
responsibilities under this Section, Executive shall be
compensated for Executive’s time at an hourly rate of $250
per hour. However, during any period in which Executive is an
employee of ABM or is receiving payments pursuant to this
Agreement or pursuant to the terms of any other ABM plan,
Executive shall not be so compensated.
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5.7 REMEDIES AND DAMAGES. The parties
agree that compliance with Sections 5.1 — 5.6 of
the Agreement is necessary to protect the business and goodwill
of Company, that the restrictions contained herein are
reasonable and that any breach of this Section will result in
irreparable and continuing harm to Company, for which monetary
damages may not provide adequate relief. Accordingly, in the
event of any actual or threatened breach of this Section by
Executive, Company and Executive agree that Company shall be
entitled to all appropriate remedies, including temporary
restraining orders and injunctions enjoining or restraining such
actual or threatened breach. Executive hereby consents to the
issuance thereof forthwith by any court of competent
jurisdiction.
5.8 LIMITATIONS. Nothing in this
Agreement shall be binding upon the parties to the extent it is
void or unenforceable for any reason in the State of Employment,
including, without limitation, as a result of any law regulating
competition or proscribing unlawful business practices.
6. EXTENSION OF EMPLOYMENT.
6.1 RENEWAL. Absent at least 60 days
written notice of termination of employment or notice of
non-renewal from Company to Executive prior to expiration of the
then current Initial or Extended Term, as applicable, of this
Agreement, employment hereunder shall continue for an Extended
Term (or another Extended Term, as applicable) of one year.
6.2 NOTICE OF NON-RENEWAL. In the event
that notice of non-renewal is given 60 days prior to the
expiration of the then Initial or Extended Term, as applicable,
of this Agreement, employment shall continue on an “at
will” basis following the expiration of such Initial or
Extended Term. In such event, Company shall have the right to
terminate Executive’s employment, position or compensation.
Executive shall remain eligible for Severance Benefits pursuant
to ABM’s Severance Policy.
7. TERMINATION OF EMPLOYMENT.
7.1 TERMINATION FOR CAUSE. Company may
terminate Executive’s employment hereunder at any time
without notice subject only to a good faith determination by the
Board of Cause. “Cause” means the occurrence of one of
the following: (i) serious misconduct, dishonesty,
disloyalty, or insubordination; (ii) Executive’s
conviction (or entry of a plea bargain admitting criminal guilt)
of any felony or a misdemeanor involving moral turpitude;
(iii) drug or alcohol abuse, that has a material or
potentially material effect on the Company’s reputation
and/or on
the performance of Executive’s duties and responsibilities
under this Agreement; (iv) failure to substantially perform
Executive’s duties and responsibilities under this
Agreement for reasons other than death or Disability, as defined
below; (v) repeated inattention to duty for reasons other
than death or Disability; and, (vi) any other material
breach of this Agreement by Executive. In the event of a
termination following the Board’s good faith determination
of Cause, employee shall receive no Severance Benefits.
7.2 VOLUNTARY TERMINATION BY
EXECUTIVE. At any time, Executive may terminate
employment hereunder by giving Company 60 days prior
written notice. Executive may terminate employment upon such
shorter period of notice as may be reasonable under the
circumstances. For a voluntary termination for reasons other
than the Executive’s Disability, Executive will not receive
any prorated Bonus.
7.3 DISABILITY OR DEATH. Employment
hereunder shall automatically terminate upon the death of
Executive and may be terminated at the Company’s discretion
as a result of Executive’s Disability.
“Disability” means Executive’s substantial
inability to perform Executive’s essential duties and
responsibilities under this Agreement for either 90 consecutive
days or a total of 120 days out of 365 consecutive days as
a result of a physical or mental illness, injury or impairment,
all as determined in good faith by the Company. Upon termination
due to death or Disability, Company shall pay when due to
Executive, or, upon death, Executive’s designated
beneficiary or estate, as applicable, any and all previously
earned, but as yet unpaid, salary, and reimbursement of business
expenses which would have otherwise been payable to Executive
under this Agreement, through the end of the month in which
Disability or death occurs. In the event of termination due to
death or Disability, Company shall pay to Executive, or, in the
event of death, to Executive’s designated beneficiary or
estate, as applicable, a prorated Bonus based on the length of
performance in the applicable performance period prior to
Disability or death. Any prorated Bonus payable under this
paragraph shall be paid at the end of the applicable performance
period when such payments are made to other participants and in
accordance with the terms of the
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applicable plan or program. Executive shall not be eligible for
any vesting of equity compensation after the Executive’s
termination date, except as pursuant to the 1996 and 2002
Price-Vested Stock Option plans.
7.4 TERMINATION WITHOUT CAUSE. Company
may terminate Executive’s employment hereunder without
Cause at any time during the then-current Initial or Extended
Term of this Agreement, as applicable, by giving Executive
90 days written notice. Upon such termination without
Cause, Executive’s right to severance benefits, if any,
shall be governed by the terms of the ABM Severance Policy or
any policy or plan of the Company as in effect from time to time
that provides for payment of severance amounts upon such a
termination of employment (“Severance Benefits”).
Executive must execute a full release of all claims within
60 days following termination of employment in order to be
eligible for Severance Benefits.
7.5 CONDITIONS TO PAYMENT AND ACCELERATION; CODE
SECTION 409A. Notwithstanding anything
contained herein to the contrary, Executive shall not be
considered to have terminated employment with the Company for
purposes of this Agreement and no payments shall be due to
Executive under this Agreement or any policy or plan of the
Company as in effect from time to time, providing for payment of
amounts on termination of employment unless Executive would be
considered to have incurred a “separation from
service” from the Company within the meaning of
Section 409A. To the extent required in order to avoid
accelerated taxation
and/or tax
penalties under Section 409A, amounts that would otherwise
be payable and benefits that would otherwise be provided
pursuant to this Agreement during the six-month period
immediately following Executive’s termination of employment
shall instead be paid on the first business day after the date
that is six months following Executive’s termination of
employment (or upon Executive’s death, if earlier).
7.6 EXCESS PARACHUTE PAYMENTS. Subject to
a Severance Agreement between Executive and the Company approved
by the Board of Directors or the Compensation Committee of ABM
Industries Incorporated, if any amount or benefit to be paid or
provided under the ABM Severance Policy, an equity award,
and/or any
other agreement between Executive and the Company would be an
Excess Parachute Payment but for the application of this
sentence, then the payments and benefits to be paid or provided
under the Severance Program, equity award,
and/or any
other agreement will be reduced to the minimum extent necessary
(but in no event to less than zero) so that no portion of any
such payment or benefit, as so reduced, constitutes an Excess
Parachute Payment; provided, however, that the foregoing
reduction will not be made if such reduction would result in
Executive receiving an amount determined on an after-tax basis,
taking into account the excise tax imposed pursuant to
Section 4999 of the Code, or any successor provision
thereto, any tax imposed by any comparable provision of state
law and any applicable federal, state and local income and
employment taxes (the “After-Tax Amount”) less than
90% of the After-Tax Amount of the severance payments Executive
would have received under the Company’s Severance Policy or
under any other agreement without regard to this clause. Whether
requested by the Executive or the Company, the determination of
whether any reduction in such payments or benefits to be
provided under this Agreement or otherwise is required pursuant
to the preceding sentence, and the value to be assigned to the
Executive’s covenants in Section 5 hereof for purposes
of determining the amount, if any, of the “excess parachute
payment” under Section 280G of the Code will be made
at the expense of the Company by the Company’s independent
accountants or benefits consultant. The fact that
Executive’s right to payments or benefits may be reduced by
reason of the limitations contained in this paragraph will not
of itself limit or otherwise affect any other rights of
Executive under any other agreement. In the event that any
payment or benefit intended to be provided is required to be
reduced pursuant to this paragraph, Executive will be entitled
to designate the payments
and/or
benefits to be so reduced in order to give effect to this
paragraph, provided, however, that payments that do not
constitute deferred compensation within the meaning of
Section 409A will be reduced first. The Company will
provide Executive with all information reasonably requested by
Executive to permit Executive to make such designation. In the
event that Executive fails to make such designation within 10
business days after receiving notice from the Company of a
reduction under this paragraph, the Company may effect such
reduction in any manner it deems appropriate. The term
“Excess Parachute Payment” as used in this paragraph
means a payment that creates an obligation for Executive to pay
excise taxes under Section 280G of the Internal Revenue
Code of 1986, as amended, or any successor statute.
7.7 ACTIONS UPON TERMINATION. Upon
termination of employment hereunder, Executive shall immediately
resign as an officer
and/or
director of Company and of any Company subsidiaries or
affiliates, including any LLCs or joint ventures, as applicable.
At Company’s request, Executive also agrees to resign from
the board of any Xxxx-Xxxxxxx trust fund joined during
Executive’s employment with Company. Executive shall
promptly return
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and release all Company property and Proprietary Information, in
all forms, in Executive’s possession to Company. Company
shall pay Executive when due any and all previously earned, but
as yet unpaid, salary and reimbursement of business expenses
submitted in accordance with Company policy as in effect. Except
as provided in Sections 7.3 and 7.4, Executive must be
employed by the Company at the end of the Fiscal Year to earn a
Bonus.
7.8 WITHHOLDING AUTHORIZATION. To the
fullest extent permitted under the laws of the State of
Employment hereunder, Executive authorizes Company to withhold
from any Severance Benefits otherwise due to Executive and from
any other funds held for Executive’s benefit by Company,
any damages or losses sustained by Company as a result of any
material breach or other material violation of this Agreement by
Executive, pending resolution of any underlying dispute.
8. NOTICES.
8.1 ADDRESSES. Any notice required or
permitted to be given pursuant to this Agreement shall be in
writing and delivered in person, or sent prepaid by certified
mail, overnight express, or electronically to the party named at
the address set forth below or at such other address as either
party may hereafter designate in writing to the other party:
|
Executive:
|
Xxxxx XxXxxxxxx | |||
| 000 Xxxx 00xx Xxxxxx, Xxxx 00X | ||||
| Xxx Xxxx, XX 00000 | ||||
| Email: Xxxxx.XxXxxxxxx@xxx.xxx | ||||
|
Company:
|
ABM Industries Incorporated | |||
| 000 Xxxxxxx Xxxxxx, Xxxxx 000 | ||||
| Xxx Xxxxxxxxx, XX 00000 | ||||
| Attention: Chief Executive Officer | ||||
|
Copy:
|
ABM Industries Incorporated | |||
| 000 Xxxxxxx Xxxxxx, Xxxxx 000 | ||||
| Xxx Xxxxxxxxx, XX 00000 | ||||
| Attention: Senior Vice President of Human Resources |
8.2 RECEIPT. Any such notice shall be
assumed to have been received when delivered in person or
48 hours after being sent in the manner specified above.
9. GENERAL PROVISIONS.
9.1 GOVERNING LAW. This Agreement shall
be interpreted and enforced in accordance with the laws of the
State of Employment, which, for purposes of this Agreement,
shall mean the state where Executive is regularly and
customarily employed and where Executive’s primary office
is located.
9.2 NO WAIVER. Failure by either party to
enforce any term or condition of this Agreement at any time
shall not preclude that party from enforcing that provision, or
any other provision of this Agreement, at any later time.
9.3 SEVERABILITY. It is the desire and
intent of the parties that the provisions of this Agreement be
enforced to the fullest extent permissible under the law and
public policies applied in each jurisdiction in which
enforcement is sought. Accordingly, in the event that any
provision of this Agreement would be held in any jurisdiction to
be invalid, prohibited or unenforceable for any reason, such
provision, as to such jurisdiction, shall be ineffective,
without invalidating the remaining provisions of this Agreement
or affecting the validity or enforceability of such provision in
any other jurisdiction. Notwithstanding the foregoing, if such
provision could be more narrowly drawn so as not to be invalid,
prohibited or unenforceable in such jurisdiction, it shall, as
to such jurisdiction, be either automatically deemed so narrowly
drawn, or any court of competent jurisdiction is hereby
expressly authorized to redraw it in that manner, without
invalidating the remaining provisions of this Agreement or
affecting the validity or enforceability of such provision in
any other jurisdiction.
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9.4 SURVIVAL. All terms and conditions of
this Agreement which by reasonable implication are meant to
survive the termination of this Agreement, including but not
limited to the provisions of Sections 5.1 — 5.6
of this Agreement, shall remain in full force and effect after
the termination of this Agreement.
9.5 REPRESENTATIONS BY
EXECUTIVE. Executive represents and agrees that
Executive has carefully read and fully understands all of the
provisions of this Agreement, that Executive is voluntarily
entering into this Agreement and has been given an opportunity
to review all aspects of this Agreement with an attorney, if
Executive chooses to do so. Executive understands
he/she is
also now eligible for Severance Benefits to which Executive was
not previously entitled and acknowledges the value of such
benefits. Executive also represents that
he/she will
not make any unauthorized use of any confidential or Proprietary
Information of any third party in the performance of
his/her
duties under this Agreement and that Executive is under no
obligation to any prior employer or other entity that would
preclude or interfere with the full and good faith performance
of Executive’s obligations hereunder.
9.6 ENTIRE AGREEMENT. Unless otherwise
specified herein, this Agreement sets forth every contract,
understanding and arrangement as to the employment relationship
between Executive and Company, and may only be changed by a
written amendment signed by both Executive and Company.
9.6.a NO EXTERNAL EVIDENCE. The parties intend
that this Agreement speak for itself, and that no evidence with
respect to its terms and conditions other than this Agreement
itself may be introduced in any arbitration or judicial
proceeding to interpret or enforce this Agreement.
9.6.b OTHER AGREEMENTS. It is specifically
understood and accepted that this Agreement supersedes all oral
and written employment agreements between Executive and Company
prior to the date of this Agreement. However, it is expressly
understood that, notwithstanding any provision to the contrary
contained in this Agreement (whether explicit or implicit), the
terms and restrictions set forth in any Asset Purchase
Agreement, Merger Agreement, Stock Purchase Agreement or any
agreement ancillary thereto, entered into by and between
Executive and any Company-affiliated entity setting forth
Executive’s duties under a Covenant Not To Compete in
connection with the sale of such assets, shall remain in full
force and effect during employment and thereafter.
9.6.c AMENDMENTS. This Agreement may not be
amended except in a writing approved by the Board and signed by
the Executive and the President or Chief Executive of Company.
IN WITNESS WHEREOF, Executive and Company have executed
this Agreement as of the date set forth above.
Executive: Xxxxx XxXxxxxxx
| Signature: |
/s/ Xxxxx
XxXxxxxxx
|
| Date: | August 1, 2008 |
Company: ABM Industries Incorporated
| Signature: |
/s/ Xxxx
Xxxxx
|
| Title: | Sr. Vice President, Human Resources |
| Date: | August 1, 2008 |
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