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EXHIBIT 10.1
FOUNDERS' AND MANAGEMENT EMPLOYMENT AGREEMENT
TO BE EXECUTED BY FOUNDERS AND KEY EXECUTIVES OF IES
ANNEX V
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") by and between ____________
___________________________________ (the "Company"), a _____________ corporation
and a wholly-owned subsidiary of Integrated Electrical Services, Inc., a
Delaware corporation ("IES"), and __________________________ ("Executive") is
hereby entered into effective as of the date of the consummation of the initial
public offering of the common stock of IES (the "Effective Date").
RECITALS
The following statements are true and correct:
As of the Effective Date, the Company, IES and the other subsidiaries
of IES (collectively, the "IES Companies") are engaged primarily in the
providing of electrical contracting services.
Executive is employed hereunder by the Company in a confidential
relationship wherein Executive, in the course of his employment with the
Company, has and will continue to become familiar with and aware of information
as to the Company's and IES' customers and specific manner of doing business,
including the processes, techniques and trade secrets utilized by the Company
and IES, and future plans with respect thereto, all of which has been and will
be established and maintained at great expense to the Company and IES. This
information is a trade secret and constitutes the valuable goodwill of the
Company and IES.
Therefore, in consideration of the mutual promises, terms, covenants
and conditions set forth herein and the performance of each, it is hereby
agreed as follows:
AGREEMENTS
1. Employment and Duties.
(a) The Company hereby employs Executive as _____________
of the Company. As such, Executive shall have responsibilities,
duties and authority reasonably accorded to, expected of and
consistent with Executive's position as _____________________ of the
Company and will report directly to the [______________] of the
Company. Executive hereby accepts this employment upon the terms and
conditions herein contained and, subject to paragraph 1(c), agrees to
devote substantially all of his time, attention and efforts to promote
and further the business and interests of the Company and its
affiliates.
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(b) Executive shall faithfully adhere to, execute and
fulfill all lawful policies established by the Company.
(c) Except as set forth on Schedule 1(c) hereto,
Executive shall not, during the term of his employment hereunder,
engage in any other business activity pursued for gain, profit or
other pecuniary advantage if such activity interferes in any material
respect with Executive's duties and responsibilities hereunder. The
foregoing limitations shall not be construed as prohibiting Executive
from making personal investments in such form or manner as will
neither require his services in the operation or affairs of the
companies or enterprises in which such investments are made nor
violate the terms of paragraph 3 hereof.
(d) Executive shall be entitled to vacation in accordance
with the policies of the Company.
2. Compensation. For all services rendered by Executive, the
Company shall compensate Executive as follows:
(a) Base Salary. The base salary payable to Executive
during the term shall be $_____________________ per year, payable in
accordance with the Company's payroll procedures for officers, but not
less frequently than monthly. Such base salary may be increased from
time to time, at the discretion of the Board of Directors of IES (the
"IES Board"), in light of the Executive's position, responsibilities
and performance.
(b) Executive Perquisites, Benefits and Other
Compensation. Executive shall be entitled to receive additional
benefits and compensation from the Company in such form and to such
extent as specified below:
(i) Reimbursement for all business travel and
other out-of-pocket expenses (including those costs to
maintain any professional certifications held or obtained by
Executive) reasonably incurred by Executive in the performance
of his duties pursuant to this Agreement and in accordance
with the Company's policy for executives of the Company. All
such expenses shall be appropriately documented in reasonable
detail by Executive upon submission of any request for
reimbursement, and in a format and manner consistent with the
Company's expense reporting policy.
(ii) Executive shall, subject to the satisfaction
of any general eligible criteria, be eligible to participate
in all compensation and benefit plans and programs as are
maintained from time to time for executives of the Company.
(iii) The Company shall provide Executive with such
other perquisites as may be deemed appropriate for Executive
by the IES Board.
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3. Non-Competition Agreement.
(a) Executive recognizes that the Company's willingness
to enter into this Agreement is based in material part on Executive's
agreement to the provisions of this paragraph 3 and that Executive's
breach of the provisions of this paragraph 3 could materially damage
the Company. Subject to the further provisions of this Agreement,
Executive will not, during the term of his employment with the
Company, and for a period of two years immediately following the
termination of such for any reason whatsoever, either for Cause or in
the event the Executive terminates his employment without Good Reason,
except as may be set forth herein, directly or indirectly, for himself
or on behalf of or in conjunction with any other person, company,
partnership, corporation or business of whatever nature:
(i) engage, as an officer, director, shareholder,
owner, partner, joint venturer, or in a managerial capacity,
whether as an employee, independent contractor, consultant or
advisor, or as a sales representative, in any electrical
contracting business in direct competition with any IES
Company within 100 miles of where any IES Company conducts
business, including any territory serviced by an IES Company
during the term of Executive's employment (the "Territory");
(ii) call upon any person who is, at that time, an
employee of an IES Company for the purpose or with the intent
of enticing such employee away from or out of the employ of
the IES Company;
(iii) 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 an IES Company within the Territory for
the purpose of soliciting or selling electrical contracting
products or services in direct competition with the IES
Companies within the Territory; or
(iv) call upon any prospective acquisition
candidate, on Executive's own behalf or on behalf of any
competitor, which candidate was, to Executive's knowledge
after due inquiry, either called upon by an IES Company or for
which an IES Company made an acquisition analysis, for the
purpose of acquiring such entity.
(v) disclose customers, whether in existence or
proposed, of the Company to any person, firm, partnership,
corporation or business for any reason or purpose whatsoever
except to the extent that the Company has in the past
disclosed such information to the public for valid business
reasons.
Notwithstanding the above, the foregoing covenant shall not be
deemed to prohibit Executive from acquiring as an investment (i) not
more than 1% of the capital stock of a
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competing business, whose stock is traded on a national securities
exchange, the Nasdaq Stock Market or on an over-the-counter or similar
market or (ii) not more than 5% of the capital stock of a competing
business whose stock is not publicly traded unless the Board of
Directors of the Company consents to such acquisition.
(b) Because of the difficulty of measuring economic
losses to the Company and IES as a result of a breach of the foregoing
covenant, and because of the immediate and irreparable damage that
could be caused to the Company and IES for which they would have no
other adequate remedy, Executive agrees that foregoing covenant may be
enforced by the Company, in the event of breach by him, by injunctions
and restraining orders. Executive further agrees to waive any
requirement for the Company's securing or posting of any bond in
connection with such remedies.
(c) It is agreed by the parties that the foregoing
covenants in this paragraph 3 impose a reasonable restraint on
Executive in light of the activities and business of the IES Companies
on the date of the execution of this Agreement and the current plans
of the IES Companies; but it is also the intent of the Company and
Executive that such covenants be construed and enforced in accordance
with the changing activities, business and locations of the IES
Companies throughout the term of this covenant, whether before or
after the date of termination of the employment of Executive, unless
the Executive was conducting such new business prior to any IES
Company conducting such new business. For example, if, during the
term of this Agreement, an IES Company engages in new and different
activities, enters a new business or establishes new locations for its
current activities or business in addition to or other than the
activities or business enumerated under the Recitals above or the
locations currently established therefor, then Executive will be
precluded from soliciting the customers or employees of such new
activities or business or from such new location and from directly
competing with such new business within 100 miles of its
then-established operating location(s) through the term of this
covenant, unless the Executive was conducting such new business prior
to any IES Company conducting such new business.
(d) It is further agreed by the parties hereto that, in
the event that Executive shall cease to be employed hereunder and
shall enter into a business or pursue other activities not in
competition with the electrical contracting activities of the IES
Companies or similar activities or business in locations the operation
of which, under such circumstances, does not violate clause (a)(i) of
this paragraph 3, and in any event such new business, activities or
location are not in violation of this paragraph 3 or of Executive's
obligations under this paragraph 3, if any, Executive shall not be
chargeable with a violation of this paragraph 3 if the IES Companies
shall thereafter enter the same, similar or a competitive (i)
business, (ii) course of activities or (iii) location, as applicable.
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(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. Moreover, in the event
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) All of the covenants in this paragraph 3 shall be
construed as an agreement independent of any other provision in this
Agreement, and the existence of any claim or cause of action of
Executive against the Company or IES, whether predicated on this
Agreement or otherwise, shall not constitute a defense to the
enforcement by IES or the Company of such covenants. It is
specifically agreed that the period of two years (subject to the
further provisions of this Agreement) following termination of
employment stated at the beginning of this paragraph 3, during which
the agreements and covenants of Executive made in this paragraph 3
shall be effective, shall be computed by excluding from such
computation any time during which Executive is in violation of any
provision of this paragraph 3.
(g) The Company and the Stockholders hereby agree that
this covenant is a material and substantial part of this transaction.
4. Term; Termination; Rights on Termination. The term of this
Agreement shall begin on the Effective Date and continue for five years (the
"Initial Term") and, unless terminated sooner as herein provided, shall
continue thereafter at Executive's and Company's mutual election on a
year-to-year basis on the same terms and conditions contained herein in effect
as of the time of renewal (the "Extended Term"); provided, however, upon a
Change in Control (as defined in paragraph 11(d)) the term of this Agreement
shall automatically continue following such Change in Control for a period
equal to the then remaining term or two years, whichever period is longer,
unless earlier terminated as provided in paragraph 11. This Agreement and
Executive's employment may be terminated in any one of the followings ways:
(a) Death. The death of Executive shall immediately
terminate this Agreement with no severance compensation due to
Executive's estate.
(b) Disability. If, as a result of incapacity due to
physical or mental illness or injury, Executive shall have been absent
from his full-time duties hereunder for four consecutive months, then
30 days after receiving written notice (which notice may occur before
or after the end of such four-month period, but which shall not be
effective earlier than the last day of such four-month period), the
Company may terminate Executive's employment hereunder, provided that
Executive is unable to resume his full-time duties at the conclusion
of such notice period. Also, Executive may terminate his employment
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hereunder if his health should become impaired to an extent that makes
the continued performance of his duties hereunder hazardous to his
physical or mental health, provided that Executive shall have
furnished the Company with a written statement from a doctor
reasonably acceptable to the Company to such effect and provided,
further, that, at the Company's request made within 30 days of the
date of such written statement, Executive shall submit to an
examination by a doctor selected by the Company who is reasonably
acceptable to Executive or Executive's doctor and such second doctor
shall have concurred in the conclusion of Executive's doctor. In the
event this Agreement is terminated as a result of Executive's
disability, Executive shall receive from the Company, in a lump sum
payment due within 10 days of the effective date of termination, the
base salary at the rate then in effect (i) during the Initial Term,
for whatever time period, if any, is remaining under the Initial Term,
provided that such period shall not be less than one year, and (ii)
during the Extended Term, equivalent to one year of base salary.
(c) Cause. The Company may terminate this Agreement and
Executive's employment 10 days after written notice to Executive for
"Cause", which shall be: (1) Executive's willful, material and
irreparable breach of this Agreement (which remains uncured 10 days
after receipt of written notice); (2) Executive's gross negligence in
the performance or intentional nonperformance (in either case
continuing for 10 days after receipt of written notice of need to
cure) of any of Executive's material duties and responsibilities
hereunder; (3) Executive's dishonesty or fraud with respect to the
business, reputation or affairs of the Company or IES which materially
and adversely affects the Company or IES (monetarily or otherwise); or
(4) Executive's conviction of a felony crime involving moral
turpitude. In the event of a termination for Cause, Executive shall
have no right to any severance compensation.
(d) Without Cause. Executive may, without Good Reason
(as hereinafter defined) terminate this Agreement and Executive's
employment, effective 30 days after written notice is provided to the
Company. Executive may only be terminated without Cause by the
Company during either the Initial Term or Extended Term if such
termination is approved by at least 51% of the members of the IES
Board. Should Executive be terminated by the Company without Cause or
should Executive terminate with Good Reason during the Initial Term,
Executive shall receive from the Company, in a lump sum payment due on
the effective date of termination, the base salary at the rate then in
effect for whatever time period is remaining under the Initial Term or
for one year, whichever amount is greater. Should Executive be
terminated by the Company without Cause or should Executive terminate
with Good Reason during the Extended Term, Executive shall receive
from the Company, in a lump sum payment due on the effective date of
termination, the base salary at the rate then in effect equivalent to
one year of base salary. Further, any termination without Cause by
the Company or by Executive for Good Reason shall operate to shorten
the period set forth in paragraph 3(a) and during which the terms of
paragraph 3 apply to one
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year from the date of termination of employment. If Executive resigns
or otherwise terminates his employment without Good Reason, rather
than the Company terminating his employment pursuant to this paragraph
4(d), Executive shall receive no severance compensation.
Executive shall have "Good Reason" to terminate his employment
hereunder upon the occurrence of any of the following events, unless
such event is agreed to in writing by Executive: (a) Executive is
demoted by means of a material reduction in authority,
responsibilities or duties to a position of less stature or importance
within the Company than the position described in Section 1 hereof;
(b) Executive's annual base salary as then in effect is reduced; or
(c) the relocation of the Company's principal executive offices to a
location outside the greater [____________________] area or the
Company's requiring Executive to relocate anywhere other than the
Company's principal executive offices.
If termination of Executive's employment arises out of the Company's
failure to pay Executive on a timely basis the amounts to which he is entitled
under this Agreement or as a result of any other breach of this Agreement by
the Company, as determined by a court of competent jurisdiction or pursuant to
the provisions of paragraph 18 below, the Company shall pay all amounts and
damages to which Executive may be entitled as a result of such breach,
including interest thereon and all reasonable legal fees and expenses and other
costs incurred by Executive to enforce his rights hereunder. Further, none of
the provisions of paragraph 3 shall apply in the event this Agreement is
terminated as a result of a breach by the Company.
Upon termination of this Agreement for any reason provided above, in
addition to the above payments, if any, Executive shall be entitled to receive
all compensation earned and all benefits and reimbursements due through the
effective date of termination, paid to Executive in a lump sum on the effective
date. All other rights and obligations of the Company and Executive under
this Agreement shall cease as of the effective date of termination, except
that the Executive's obligations under paragraphs 3, 5, 6, 7, and 8 herein
shall survive such termination in accordance with their terms.
5. Return of Company Property. All records, designs, patents,
business plans, financial statements, manuals, memoranda, lists and other
property delivered to or compiled by Executive by or on behalf of the Company,
IES or any IES Companies or their representatives, vendors or customers which
pertain to the business of the Company or IES or any IES Companies shall be and
remain the property of the Company or IES or the IES Company, as the case may
be, and be subject at all times to their discretion and control. Likewise, all
correspondence, reports, records, charts, advertising materials and other
similar data pertaining to the business, activities or future plans of the
Company or IES or the IES Company which is collected by Executive shall be
delivered promptly to the Company without request by it upon termination of
Executive's employment.
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6. Inventions. Executive shall disclose promptly to the Company
any and all significant conceptions and ideas for inventions, improvements and
valuable discoveries, whether patentable or not, which are conceived or made by
Executive, solely or jointly with another, during the period of employment or
within one year thereafter, if conceived during employment, and which are
directly related to the business or activities of the Company and which
Executive conceives as a result of his employment by the Company. Executive
hereby assigns and agrees to assign all his interests therein to the Company or
its nominee. Whenever requested to do so by the Company, Executive shall
execute any and all applications, assignments or other instruments that the
Company shall deem necessary to apply for and obtain Letters Patent of the
United States or any foreign country or to otherwise protect the Company's
interest therein.
7. Trade Secrets. Executive agrees that he will not, during or
after the term of this Agreement, disclose the specific terms of the Company's
or IES' relationships or agreements with their respective significant vendors
or customers or any other significant and material trade secret of the Company
or IES, whether in existence or proposed, to any person, firm, partnership,
corporation or business for any reason or purpose whatsoever.
8. Confidentiality.
(a) Executive acknowledges and agrees that all
Confidential Information (as defined below) of the Company is
confidential and a valuable, special and unique asset of the Company
that gives the Company an advantage over its actual and potential,
current and future competitors. Executive further acknowledges and
agrees that Executive owes the Company a fiduciary duty to preserve
and protect all Confidential Information from unauthorized disclosure
or unauthorized use, that certain Confidential Information constitutes
"trade secrets" under applicable laws and, that unauthorized
disclosure or unauthorized use of the Company's Confidential
Information would irreparably injure the Company.
(b) Both during the term of Executive's employment and
after the termination of Executive's employment for any reason
(including wrongful termination), Executive shall hold all
Confidential Information in strict confidence, and shall not use any
Confidential Information except for the benefit of the Company, in
accordance with the duties assigned to Executive. Executive shall
not, at any time (either during or after the term of Executive's
employment), disclose any Confidential Information to any person or
entity (except other employees of the Company who have a need to know
the information in connection with the performance of their employment
duties), or copy, reproduce, modify, decompile or reverse engineer any
Confidential Information, or remove any Confidential Information from
the Company's premises, without the prior written consent of the
President of the Company, or permit any other person to do so.
Executive shall take reasonable precautions to protect the physical
security of all documents and other material containing Confidential
Information (regardless of the medium on which the Confidential
Information is stored). This Agreement
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applies to all Confidential Information, whether now known or later to
become known to Executive.
(c) Upon the termination of Executive's employment with
the Company for any reason, and upon request of the Company at any
other time, Executive shall promptly surrender and deliver to the
Company all documents and other written material of any nature
containing or pertaining to any Confidential Information and shall not
retain any such document or other material. Within five days of any
such request, Executive shall certify to the Company in writing that
all such materials have been returned.
(d) As used in this Agreement, the term "Confidential
Information" shall mean any information or material known to or used
by or for the Company (whether or not owned or developed by the
Company and whether or not developed by Executive) that is not
generally known to persons in the electrical contracting business.
Confidential information includes, but is not limited to, the
following: all trade secrets of the Company; all information that the
Company has marked as confidential or has otherwise described to
Executive (either in writing or orally) as confidential; all nonpublic
information concerning the Company's products, services, prospective
products or services, research, product designs, prices, discounts,
costs, marketing plans, marketing techniques, market studies, test
data, customers, customer lists and records, suppliers and contracts;
all Company business records and plans; all Company personnel files;
all financial information of or concerning the Company; all
information relating to operating system software, application
software, software and system methodology, hardware platforms,
technical information, inventions, computer programs and listings,
source codes, object codes, copyrights and other intellectual
property; all technical specifications; any proprietary information
belonging to the Company; all computer hardware or software manual;
all training or instruction manuals; and all data and all computer
system passwords and user codes.
9. No Prior Agreements. Executive hereby represents and
warrants to the Company that the execution of this Agreement by Executive and
his employment by the Company and the performance of his duties hereunder will
not violate or be a breach of any agreement with a former employer, client or
any other person or entity. Further, Executive agrees to indemnify the Company
for any claim, including, but not limited to, reasonable 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 the Company based upon or
arising out of any non-competition agreement, invention or secrecy agreement
between Executive and such third party which was in existence as of the date of
this Agreement.
10. Assignment; Binding Effect. Executive understands that he has
been selected for employment by the Company on the basis of his personal
qualifications, experience and skills. Executive agrees, therefore, that he
cannot assign all or any portion of his performance under this
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Agreement. Subject to the preceding two sentences and the express provisions
of paragraph 12 below, this Agreement shall be binding upon, inure to the
benefit of and be enforceable by the parties hereto and their respective heirs,
legal representatives, successors and assigns.
11. Change in Control.
(a) Executive understands and acknowledges that the
Company may be merged or consolidated with or into another entity and
that such entity shall automatically succeed to the rights and
obligations of the Company hereunder or that the Company may undergo a
Change in Control (as defined below). In the event a Change in
Control is initiated or occurs during the Initial Term or Extended
Term, then the provisions of this paragraph 11 shall be applicable.
(b) In the event of a Change in Control wherein the
Company and Executive have not received written notice at least ten
business days prior to the date of the event giving rise to the Change
in Control from the successor to all or a substantial portion of the
Company's business and/or assets that such successor is willing as of
the closing to assume and agrees to perform the Company's obligations
under this Agreement in the same manner and to the same extent that
the Company is hereby required to perform, then Executive may, at
Executive's sole discretion, elect to terminate Executive's employment
on such Change in Control by providing written notice to the Company
prior to the closing of the transaction giving rise to the Change in
Control. In such case, the applicable provisions of paragraph 4(d)
will apply as though the Company had terminated Executive without
Cause; however, the amount of the lump sum severance payment due
Executive shall be triple the amount calculated under the terms of
paragraph 4(d), but shall in no event exceed nine times Executive's
base salary.
(c) In any Change in Control situation, Executive may, at
Executive's sole discretion, elect to terminate Executive's employment
upon the effective date of such Change in Control by providing written
notice to the Company at least five business days prior to the closing
of the transaction giving rise to the Change in Control. In such
case, the applicable provisions of paragraph 4(d) will apply as though
the Company had terminated Executive without Cause; however, the
amount of the lump sum severance payment due Executive shall be double
the amount calculated under the terms of paragraph 4(d), but shall in
no event exceed six times Executive's base salary.
(d) If, on or within two years following the effective
date of a Change in Control the Company terminates Executive's
employment other than for Cause or Executive terminates his employment
for Good Reason, or if Executive's employment with the Company is
terminated by the Company within three months before the effective
date of a Change in Control and it is reasonably demonstrated that
such termination (i) was at the
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request of a third party that has taken steps reasonably calculated to
effect a Change in Control, or (ii) otherwise arose in connection with
or anticipation of a Change in Control, then Executive shall receive
from Company, in a lump sum payment due on the effective date of
termination, the greater of (i) the equivalent of three years' base
salary at the rate then in effect, or (ii) the base salary for
whatever period is then remaining on the Initial Term, if any.
(e) A "Change in Control" shall be deemed to have
occurred if:
(i) any person, entity or group (as such terms
are used in Sections 13(d) and 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the "Act"), other than the
IES Companies or an employee benefit plan of the IES
Companies, acquires, directly or indirectly, the beneficial
ownership (as defined in Section 13(d) of the Act) of any
voting security of IES and immediately after such acquisition
such person is, directly or indirectly, the beneficial owner
of voting securities representing 20% or more of the total
voting power of all of the then outstanding voting securities
of IES entitled to vote generally in the election of
directors;
(ii) upon the first purchase of IES's common stock
pursuant to a tender or exchange offer (other than a tender or
exchange offer made by IES);
(iii) the stockholders of IES shall approve a
merger, consolidation, recapitalization or reorganization of
IES, or a reverse stock split of outstanding voting
securities, or consummation of any such transaction if
stockholder approval is not obtained, other than any such
transaction which would result in at least 75% of the total
voting power represented by the voting securities of the
surviving entity outstanding immediately after such
transaction being beneficially owned by the holders of all of
the outstanding voting securities of IES immediately prior to
the transactions with the voting power of each such continuing
holder relative to other such continuing holders not
substantially altered in the transaction;
(iv) the stockholders of IES shall approve a plan
of complete liquidation or dissolution of IES or an agreement
for the sale or disposition by IES of all or substantially all
of IES's assets; or
(v) if, at any time during any period of two
consecutive years, individuals who at the beginning of such
period constitute the Board cease for any reason to constitute
at least a majority thereof, unless the election or nomination
for the election by the Company's stockholders of each new
director was approved by a vote of at least two-thirds of the
directors then still in office who were directors at the
beginning of the period.
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(f) Notwithstanding anything in this Agreement to the
contrary, a termination pursuant to paragraph 11(b), (c), or (d) shall
operate to automatically waive in full the noncompetition restrictions
imposed on Executive pursuant to paragraph 3(a).
(g) If it shall be finally determined that any payment
made or benefit provided to Executive in connection with a "change in
control" of the Company or IES, whether or not made or provided
pursuant to this Agreement, is subject to the excise tax imposed by
Section 4999 of the Internal Revenue Code of 1986, as amended, or any
successor thereto, the Company shall pay Executive an amount of cash
(the "Additional Amount") such that the net amount received by
Executive after paying all applicable taxes on such Additional Amount
shall be equal to the amount that Executive would have received if
Section 4999 were not applicable.
12. No Mitigation or Offset. Executive shall not be required to
mitigate the amount of any Company payment provided for in this Agreement by
seeking other employment or otherwise. The amount of any payment required to
be paid to Executive by the Company pursuant to this Agreement shall not be
reduced by any amounts that are owed to the Company by Executive, or by any
setoff, counterclaim, recoupment, defense or other claim, right or action.
13. Release. Notwithstanding anything in this Agreement to the
contrary, Executive shall not be entitled to receive any payments pursuant to
this Agreement unless Executive has executed (and not revoked) a general
release of all claims Executive may have against the Company and its affiliates
in a form of such release reasonably acceptable to the Company.
14. Indemnification. In the event Executive is made a party to
any threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by the Company
against Executive), by reason of the fact that he is or was performing services
under this Agreement, then the Company shall indemnify Executive against all
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement, as actually and reasonably incurred by Executive in connection
therewith. In the event that both Executive and the Company are made a party
to the same third-party action, complaint, suit or proceeding, the Company
agrees to engage competent legal representation, and Executive agrees to use
the same representation, provided that if counsel selected by the Company shall
have a conflict of interest that prevents such counsel from representing
Executive, Employee may engage separate counsel and the Company shall pay all
attorneys' fees and reasonable expenses of such separate counsel. Further,
while Executive is expected at all times to use his best efforts to faithfully
discharge his duties under this Agreement, Executive cannot be held liable to
the Company for errors or omissions made in good faith where Executive has not
exhibited gross, willful and wanton negligence and misconduct nor performed
criminal and fraudulent acts which materially damage the business of the
Company.
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15. Complete Agreement. Executive has no oral representations,
understandings or agreements with the Company, IES or any of their officers,
directors or representatives covering the same subject matter as this
Agreement. This written Agreement is the final, complete and exclusive
statement and expression of the agreement between the Company, IES and
Executive and of all the terms of this Agreement, and it cannot be varied,
contradicted or supplemented by evidence of any prior or contemporaneous oral
or written agreements. This written Agreement may not be later modified except
by a further writing signed by a duly authorized officer of the Company and
Executive, and no term of this Agreement may be waived except by writing signed
by the party waiving the benefit of such term. Without limiting the generality
of the foregoing, either party's failure to insist on strict compliance with
this Agreement shall not be deemed a waiver thereof.
16. Notice. Whenever any notice is required hereunder, it shall be
given in writing addressed as follows:
To the Company: c/o Integrated Electrical Services, Inc.
Attn:
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To Executive:
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Notice shall be deemed given and effective on the earlier of 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.
Either party may change the address for notice by notifying the other party of
such change in accordance with this paragraph 16.
17. 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 the Agreement or of any part hereof.
18. Dispute Resolutions. Except with respect to injunctive relief
as provided in paragraph 3(b), neither party shall institute a proceeding in
any court or administrative agency to resolve a dispute between the parties
before that party has sought to resolve the dispute through direct negotiation
with the other party. If the dispute is not resolved within two weeks after a
demand for direct negotiation, the parties shall attempt to resolve the dispute
through mediation.
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If the parties do not promptly agree on a mediator, the parties shall request
the Association of Attorney Mediators in Xxxxxx County, Texas to appoint a
mediator certified by the Supreme Court of Texas. If the mediator is unable to
facilitate a settlement of the dispute within a reasonable period of time, as
determined by the mediator, the mediator shall issue a written statement to the
parties to that effect and any unresolved dispute or controversy arising under
or in connection with this Agreement shall be settled exclusively by
arbitration, conducted before a panel of three arbitrators in Houston, Texas,
in accordance with the rules of the American Arbitration Association then in
effect. The arbitrators shall have the authority to order back-pay, severance
compensation, vesting of options (or cash compensation in lieu of vesting of
options), reimbursement of costs, including those incurred to enforce this
Agreement, and interest thereon in the event the arbitrators determine that
Executive was terminated without disability or Cause, as defined in paragraphs
4(b) and 4(c), respectively, or that the Company has otherwise materially
breached this Agreement. A decision by a majority of the arbitration panel
shall be final and binding. Judgment may be entered on the arbitrators' award
in any court having jurisdiction. The costs and expenses, including reasonable
attorneys' fees, of the prevailing party in any dispute arising under this
Agreement will be promptly paid by the other party.
19. Governing Law. This Agreement shall in all respects be
construed according to the laws of the State of Texas without regard to its
conflicts of law provisions.
20. Counterparts. This Agreement may be executed simultaneously
in two or more counterparts, each of which shall be deemed an original and all
of which together shall constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective for all purposes as of the Effective Date.
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By:
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Name:
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Title:
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EXECUTIVE
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