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EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (this "Agreement"), made and entered into as of
the 18th day of November 1996, by and between COMMODORE ENVIRONMENTAL SERVICES,
INC., a Delaware corporation having offices at 000 Xxxx 00xx Xxxxxx, Xxxxx 0000,
Xxx Xxxx, Xxx Xxxx 00000 (the "Company"), and XXXX X. XXXXXXXXX, an individual
residing at 0000 Xxxx Xxxxx Xxxxx, Xxxx Xxxx Xxxxx, Xxxxxxx 00000 (the
"Employee").
W I T N E S S E T H:
WHEREAS, the Employee has substantial knowledge and experience
relating to the management and operation of technology-driven developmental
businesses, and the Company desires to obtain the full-time services of the
Employee to serve in an executive capacity with the Company; and
WHEREAS, the Employee is ready, willing and able to serve as an
executive officer of the Company, all upon the terms and subject to the
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants herein contained, the parties hereto hereby agree as follows:
Part A. Employment.
1. Duties. Subject to the terms and conditions of this Agreement,
the Company shall employ the Employee and the Employee shall render services to
the Company in the capacities and with the titles of Chairman and Chief
Executive Officer of the Company. In addition, the Employee shall serve in such
capacity and have such title with such of the
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Company's subsidiaries as may be requested from time to time by the Company,
without requirement of any additional compensation to the Employee.
2. Full-Time Employment. Throughout the period of his employment
hereunder, the Employee shall devote his full and entire professional and
business time, attention, knowledge and skills to faithfully, diligently and to
the best of his abilities perform his duties hereunder. It is expected that the
Employee will render his services primarily from the Company's New York, New
York office, provided that the Employee will engage in such travelling as may be
reasonably required in connection with the performance of his duties hereunder.
3. Director. The Company will cause the Employee to be elected a
member of the Board of Directors of the Company and each of its publicly-traded
subsidiaries, for so long as the Employee remains the Company's Chairman and
Chief Executive Officer.
Part B. Term of Employment; Termination of Agreement.
1. Term. Subject to prior termination in accordance with the
provisions hereof, the term of this Agreement shall commence on November 1, 1996
and shall continue through and including December 31, 1999 (the "Term").
2. Termination For Cause. Anything contained in Section 1 of this
Part B to the contrary notwithstanding, this Agreement may be terminated at the
option of the Board of Directors of the Company (the "Board") for "Cause" (as
hereinafter defined), effective upon the giving of written notice of termination
to the Employee. As used herein, the term "Cause" shall mean and be limited to:
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a. any act committed by the Employee against the Company, or
any of its subsidiaries or divisions, constituting: (i) fraud, (ii)
misappropriation of corporate opportunity, breach of fiduciary duty or
non-disclosure of a conflict of interest, (iii) self-dealing, (iv) embezzlement
of funds, (v) felony conviction for conduct involving moral turpitude or other
criminal conduct, or (vi) the disregard by the Employee of the reasonable
directions of the Board; or
b. the breach or default by the Employee in the performance of
any material provision of this Agreement (including but not limited to Part D
below); or
c. alcoholism or any other form of addiction which impairs the
Employee's ability to perform his duties hereunder.
3. Death or Disability. Anything contained in Section 1 of this Part
B to the contrary notwithstanding, this Agreement may be terminated by the
Company: (i) upon the death of the Employee, or (ii) on thirty (30) days' prior
written notice to the Employee, in the event that the Employee shall be
physically or mentally disabled or impaired so as to prevent him from continuing
the normal and proper performance of his duties and responsibilities hereunder
for a period of three (3) consecutive months. The initial determination as to
whether the Employee is disabled or impaired shall be made by the physician
regularly treating the condition causing the disability. The Company shall have
the right to require the Employee to be examined by a physician duly licensed to
practice medicine in the State in which the Employee has his primary residence
to determine such physician's opinion as to the Employee's disability. If such
physician's opinion differs from that of the physician treating the Employee, or
a physician thereafter retained by the Employee, they shall forthwith select a
third physician
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so licensed whose opinion, after examination and review of available
information, shall be conclusive and binding upon all parties hereto. All costs
of the physician regularly treating or thereafter retained by the Employee shall
be paid by the Employee. All costs of the physician retained by the Company
shall be paid by the Company. If a third physician is required, then the costs
of that physician shall be paid by the Company.
4. No Further Obligations. Upon any termination of this Agreement by
the Company for "Cause" pursuant to Section 2 of this Part B, or by reason of
the Employee's death or disability pursuant to Section 3 of this Part B, neither
the Company nor any subsidiary or division thereof shall be liable for or be
required to pay to the Employee any further remuneration, compensation or other
benefits hereunder.
Part C. Compensation; Expenses.
1. Base Salary. As compensation for his services during the Term,
the Company shall pay or cause to be paid to the Employee a fixed base salary at
the annual rate of Three Hundred Ninety-Five Thousand Dollars ($395,000).
2. Signing Bonus. The Employee shall be paid a signing bonus of
$150,000 upon the execution of this Agreement.
3. Company Stock Options. In consideration for the Employee's
entering into this Agreement with the Company, the Company is, as of the date
hereof, granting to the Employee a stock option (the "Stock Option") to purchase
an aggregate of 2,500,000 shares of common stock, par value $.01 per share, of
the Company (the "Common Stock"), at an exercise price per share equal to the
closing sale or bid price of the Common Stock as reported or quoted on the OTC
Bulletin, Nasdaq Stock Market or American Stock Exchange, as the case may be,
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on the last trading day prior to the date hereof. Provided that the Employee is
in the full-time employ of the Company on each date of exercise, such Stock
Option will be exercisable as to 500,000 shares of Common Stock commencing on
the first anniversary of this Agreement (the "Initial Vesting Date") and as to
an additional 500,000 shares of Common Stock commencing on each of the four
successive anniversaries of the Initial Vesting Date. The other terms and
conditions of the Stock Option shall be as set forth in a separate Stock Option
Agreement between the Company and the Employee. In addition, the Company
acknowledges and agrees that the stock options to purchase 500,000 shares of
Common Stock at an exercise price of $.53 per share currently held by the
Employee will vest effective as of the date of this Agreement.
4. Subsidiary Stock Options. As additional consideration for the
Employee's entering into this Agreement with the Company, the Company is, as of
the date hereof granting, and will from time to time in the future grant, as
applicable, to the Employee stock options to purchase common stock of each
publicly-traded subsidiary of the Company in the amount of 1.0% of such
subsidiary's total outstanding shares of common stock on the date of grant and
at an exercise price per share equal to the then-current fair market value per
share on the date of grant.
5. Incentive Compensation. The Employee will be entitled to receive
incentive compensation of up to $200,000 per year for achieving goals
established and determined by the parties within 120 days after the date of this
Agreement.
6. Benefits. In addition to the foregoing compensation, the Employee
shall, throughout the period of his employment hereunder, be eligible to
participate in any and all group health, group life and/or other benefit plans
generally made available by the Company to
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its employees, provided that nothing herein contained shall be deemed to require
the Company to maintain or continue any particular plan or policy.
7. Vacation. The Employee shall be entitled to up to four (4) weeks
of vacation per year, to be taken at such times as shall be mutually agreeable
to the Company and the Employee, and so as not to unduly interfere with the
business of the Company. The Employee may carry over, to the next annual period
hereunder, up to two (2) weeks of unused vacation time as at the end of each
year of the term of this Agreement.
8. Expenses. In addition to the compensation set forth above,
throughout the period of the Employee's employment hereunder, the Company shall
also reimburse the Employee or cause the Employee to be reimbursed, upon
presentment by the Employee to the Company of appropriate receipts and vouchers
therefor, for any reasonable business expenses incurred by the Employee in
connection with the performance of his duties and responsibilities hereunder;
provided, however, that in order to be reimbursable hereunder, any such expense
must be deductible (in whole or in part) by the Company for federal income tax
purposes.
Part D. Confidentiality; Non-Competition. As a material inducement to
cause the Company to enter into this Agreement, the Employee hereby covenants
and agrees that:
1. Confidential Information. The Employee shall, at all times during
and subsequent to the Term, keep secret and retain in strictest confidence all
confidential matters of the Company, and the "know-how", trade secrets,
technical processes, inventions, equipment specifications, equipment designs,
plans, drawings, research projects, confidential client lists, details of
client, subcontractor or consultant contracts, pricing policies, operational
methods, marketing plans and strategies, project development, acquisition and
bidding techniques and
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plans, business acquisition plans, and new personnel acquisition plans of the
Company and its subsidiaries and divisions (whether now known or hereafter
learned by the Employee), except to the extent that (i) such information is
generally available to the public without restriction, (ii) the Employee obtains
confidentiality agreements with respect to such confidential information, (iii)
the Employee is requested by the Board of Directors of the Company or a
Committee thereof, to disclose such confidential information, (iv) such
information is provided to a customer of the Company pursuant to a request
received from such customer in the ordinary course of business, or (v) the
Employee is under compulsion of either a court order or a governmental agency's
or authority's inquiry, order or request to so disclose such information.
2. Property of the Company.
(a) Except as otherwise provided herein, all lists, records
and other non-personal documents or papers (and all copies thereof) relating to
the Company and/or any of its subsidiaries or divisions, including such items
stored in computer memories, on microfiche or by any other means, made or
compiled by or on behalf of the Employee, or made available to the Employee, are
and shall be the property of the Company, and shall be delivered to the Company
on the date of termination of the Employee's employment with the Company, or
sooner upon request of the Company at any time or from time to time.
(b) All inventions, including any procedures, formulas,
methods, processes, uses, apparatuses, patterns, designs, plans, drawings,
devices or configurations of any kind, any and all improvements to them which
are developed, discovered, made or produced, and all trade secrets and
information used by the Company and/or its subsidiaries and divisions
(including, without limitation, any such matters created or developed by the
Employee during
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the term of this Agreement), shall be the exclusive property of the Company or
the subject subsidiary, and shall be delivered to the Company or the subject
subsidiary (without the Employee retaining any copies, components or records
thereof) on the date of termination of the Employee's employment with the
Company; provided, however, that nothing herein contained shall be deemed to
grant to the Company any property rights in any inventions or other intellectual
property which may at any time be developed by the Employee which is wholly
unrelated to any business then engaged in or under development by the Company.
3. Employees of the Company. The Employee shall not, at any time
(whether during the term of this Agreement or at any time thereafter), directly
or indirectly, for or on behalf of any business enterprise other than the
Company and/or its subsidiaries and affiliates, solicit any employee of the
Company or any of its subsidiaries to leave his or her employment with the
Company or such subsidiary, or encourage any such employee to leave such
employment, without the prior written approval of the Company in each instance.
4. Non-Competition. For so long as the Employee shall be receiving
any compensation or remuneration under this Agreement, and for a further period
of one (1) year thereafter, the Employee shall not, directly or indirectly,
whether individually or as an employee, stockholder (other than the passive
ownership of up to 5% of the capital stock of a publicly traded corporation),
partner, joint venturer, agent or other representative of any other person, firm
or corporation, engage or have any interest in any business (other than the
Company or any of its subsidiaries or affiliates) which, in any country in which
the Company or any of its subsidiaries or divisions does or solicits business
during the Term, is engaged in or derives any revenues from performing any
functionally equivalent services or marketing any
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functionally equivalent products as those services provided and products
marketed by the Company or any of its subsidiaries or divisions during the Term.
5. Severability of Covenants. The Employee acknowledges and agrees
that the provisions of this Part D are (a) made in consideration of the premises
and undertakings of the Company set forth herein, (b) made for good, valuable
and adequate consideration received and to be received by the Employee, and (c)
reasonable and necessary, in terms of the time, geographic scope and nature of
the restrictions, for the protection of the Company and the business and good
will thereof. It is intended that the provisions of this Part D be fully
severable, and in the event that any of the foregoing restrictions, or any
portion of the foregoing restrictions, shall be deemed contrary to law, invalid
or unenforceable in any respect by any court or tribunal of competent
jurisdiction, then such restrictions shall be deemed to be amended, modified and
reduced in scope and effect, as to duration and/or geographic area, only to that
extent necessary to render same valid and enforceable (and in such reduced form,
such provisions shall then be enforceable), and any other of the foregoing
restrictions shall be unaffected and shall remain in full force and effect.
6. Equitable Remedies. The parties hereby acknowledge that, in the
event of any breach or threatened breach by the Employee of the provisions of
this Part D, the Company will suffer irreparable harm and will not have an
adequate remedy at law. Accordingly, in the event of any such breach or
threatened breach, the Company may seek and obtain appropriate equitable relief
to restrain or enjoin such breach or threatened breach and/or to compel
compliance herewith.
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Part E. Miscellaneous.
1. Binding Effect. All of the terms and conditions of this Agreement
shall be binding upon and inure to the benefit of the Employee, the Company and
their respective heirs, executors, administrators, personal representatives,
successors and permitted assigns.
2. Notices. Except as may otherwise be provided herein, any notice,
request, demand or other communication required or permitted under this
Agreement shall be in writing and shall be deemed to have been given when
delivered personally or when mailed by certified mail, return receipt requested,
addressed to a party at the address of such party first set forth above, or at
such other address as such party may hereafter have designated by notice. Copies
of all notices hereunder shall simultaneously be sent by first class post-paid
mail to Greenberg, Traurig, Hoffman, Lipoff, Xxxxx & Xxxxxxx, Citicorp Center,
000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: Xxxxxxx X. Xxxxx, Esq.
3. Waivers. Neither this Agreement nor any of the terms or
conditions hereof may be waived, amended or modified except by means of a
written instrument duly executed by the party to be charged therewith.
4. Captions. The captions and paragraph headings used in this
Agreement are for convenience of reference only, and shall not affect the
construction or interpretation of this Agreement or any of the provisions
hereof.
5. Governing Law. This Agreement, and all matters or disputes
relating to the validity, construction, performance or enforcement hereof, shall
be governed by, and construed under, the laws of the State of New York, without
giving effect to principles of conflicts of laws thereof.
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6. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original hereof, but all of
which together shall constitute one and the same instrument.
7. Arbitration. Except for any court action or proceeding to obtain
equitable relief in respect of the provisions of Part D above, any dispute
involving the interpretation or application of this Agreement shall be resolved
by final and binding arbitration before an arbitrator designated by, and
mutually acceptable to, the Company and the Employee. In the event that the
parties cannot agree to the appointment of a mutually acceptable arbitrator, the
subject dispute shall be resolved by final and binding arbitration before one or
more arbitrators designated by the American Arbitration Association in New York,
New York, unless mutually agreed to otherwise. The award of any of such
arbitrator(s) may be enforced in any court of competent jurisdiction.
8. Assignment.
(a) This Agreement is intended for the sole and exclusive
benefit of the parties hereto and their respective heirs, executors,
administrators, personal representatives, successors and permitted assigns, and
no other person or entity shall have any right to rely on this Agreement or to
claim or derive any benefit herefrom absent the express written consent of the
party to be charged with such reliance or benefit.
(b) The Employee may not assign or otherwise transfer any of
his obligations or duties hereunder to any other person, firm or corporation, it
being understood and agreed that this Agreement is intended to be for the
personal services of the Employee only and of no other person.
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(c) The Company shall have the right, at any time and from
time to time, to cause any payments required hereunder to be made by any
subsidiary of the Company. Furthermore, the Company may assign this Agreement to
any successor-in-interest who may acquire, whether by direct purchase, sale of
securities, merger or consolidation, the assets, business or properties of the
Company; provided that no such assignment shall relieve the Company of its
duties and obligations to the Employee hereunder, without the prior written
consent of the Employee.
9. Superseding Effect. This Agreement supersedes and replaces any
previous employment agreement entered into by the Employee with the Company or
any subsidiary or
affiliate thereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
on and as of the date first set forth above.
COMMODORE ENVIRONMENTAL SERVICES, INC.
By:
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Name: Bentley X. Xxxx
Title: Chairman of the Board
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Xxxx X. Xxxxxxxxx
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