EMPLOYMENT AGREEMENT
THIS
EMPLOYMENT AGREEMENT (the “Agreement”)
is
made and entered into as of this 8th
December, 2006, by and between GEMMA POWER SYSTEMS, LLC, a Connecticut limited
liability company (the “Company”),
and
XXXXXXX X. XXXXXXX, XX. (the “Employee”).
RECITALS:
R-1. Argan,
Inc., a Delaware corporation (“Argan”),
has
acquired all of the membership interests of the Company pursuant to that certain
Membership Interest Purchase Agreement (the “Purchase Agreement”),
of
even date herewith, by and among Argan, the Company, Gemma Power, Inc., a
Connecticut corporation (“GPS-Connecticut”),
Gemma
Power Systems California, Inc., a California corporation (“GPS-California,”
and
together with GPS-Connecticut, the “Affiliates”),
the
Employee and Xxxxxxx X. Xxxxxxx, Xx.; and has acquired and all of the issued
and
outstanding shares of capital stock of the Affiliates pursuant to that certain
Stock Purchase Agreement, of even date herewith, by and among Argan, the
Affiliates, the Employee and Xxxxxxx X. Xxxxxxx, Xx.
R-2. The
Company and the Affiliates are in the business of engineering and constructing
power energy systems, and providing consulting, owner’s representative,
operating, and maintenance services to the energy market (collectively, the
“Business”).
R-3. The
Employee possesses intimate knowledge of the Business as a result of his
long-term employment by the Company.
R-4. The
Company wishes to continue to employ the Employee, and the Employee wishes
to
accept such continued employment, subject to and in accordance with the
following terms and conditions.
NOW,
THEREFORE,
in
consideration of the foregoing premises, the mutual promises and covenants
set
forth herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. Employment.
The
Company hereby agrees to continue to employ the Employee, and the Employee
hereby agrees to accept such continued employment, subject to the terms and
conditions set forth in this Agreement. This Agreement supersedes and replaces
any previous oral or written agreement concerning the Employee’s employment by
the Company.
2. Duties
of the Employee.
During
the “Term”
(as
defined below) of employment of the Employee, the Employee shall serve as
President and Chief Operating Officer of the Company, and shall faithfully
and
diligently perform all services as may be assigned to him by the Board of
Directors of the Company (the “Board”),
and
shall exercise such power and authority as may from time to time be delegated
to
him by the Board. The Employee shall devote his time and attention to the
business and affairs of the Company, perform all services to be rendered by
him
hereunder to the best of his ability, and use his best efforts to promote the
interests of the Company and the Affiliates. Notwithstanding the foregoing,
it
shall not be a breach or violation of this Agreement for the Employee to manage
personal investments so long as such activities do not significantly interfere
with or significantly detract from the performance of the Employee’s
responsibilities to the Company in accordance with this Agreement.
3. Term
of Employment.
Employment
of the Employee pursuant to the terms and provisions of this Agreement shall
commence on the date of Closing, as defined in the Purchase Agreement (the
“Effective
Date”),
and
shall continue for a term of eighteen (18) months thereafter (the “Initial
Term”),
unless earlier terminated as provided in this Agreement. At the end of the
Initial Term, the Employee’s employment hereunder shall automatically renew for
successive one year terms (each, a “Renewal
Term”),
subject to earlier termination as provided in this Agreement, unless the Company
or the Employee delivers written notice to the other at least three (3) months
prior to the expiration date of the Initial Term or any Renewal Term, as the
case may be, of its or his election not to renew the term of employment.
The
period during which the Employee shall be employed by the Company pursuant
to
the terms and provisions of this Agreement is sometimes referred to herein
as
the “Term.”
4. Compensation.
4.1
Salary.
The
Company shall pay the Employee compensation at the annual rate of $430,000
(the
“Salary”)
during
the Initial Term, payable in installments consistent with the Company’s normal
payroll schedule, subject to applicable withholding and other taxes. Not later
than four (4) months prior to the expiration of the Initial Term or of any
Renewal Term, as the case may be, Argan and the Employee shall commence
discussions aimed at determining a mutually acceptable Salary for the then
impending Renewal Term.
4.2
Bonus.
In
addition to Salary, the Employee shall be eligible for bonus compensation as
determined by the Board based upon the Employee’s performance and the results of
the Company’s operations.
5. Benefit
Plans; Insurance.
5.1 Benefit
Plans.
The
Employee shall be permitted to participate in all employee medical, retirement
and insurance benefit plans applicable to officers of the Company, and such
other plans as may from time to time be made available or applicable to the
Company, consistent with the policies of the Company.
5.2
Key-Man
Term Life Insurance.
The
Company will maintain and will pay the premiums on a key-man term life insurance
policy on the life of the Employee. Such policy shall (a) name Argan as sole
beneficiary, (b) be in the amount of not less than Five Million Dollars
($5,000,000), and (c) remain in full force and effect for the Term, or until
the
expiration of the term of said policy, if sooner. Each of the Employee and
the
Company agrees to take whatever action is reasonably required by the insurer
to
maintain such policy in full force and effect for such time. Upon the
termination of the Employee’s employment hereunder for any reason, the Company
shall assign to the Employee any and all rights which it may have in and to
said
insurance policy for the value of the prepaid unearned premium
thereof.
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6. Vacation.
The
Employee shall be entitled to unlimited paid vacation during the Term; provided
that the Employee is available by telephone during such periods of paid
vacation; and provided that the Employee notifies the Company a reasonable
period in advance of taking any such vacation and schedules same at a time
and
in a manner that will not adversely affect the Company.
7. Expenses.
The
Company shall reimburse the Employee, consistent with the Company’s expense
reimbursement policies and procedures and subject to receipt of appropriate
documentation, for all reasonable and necessary out-of-pocket travel, business
entertainment, and other business expenses incurred or expended by the Employee
incident to the performance of his duties hereunder.
8. Working
Facilities; Parking.
During
the Term the Company shall furnish the Employee with an office, secretarial
help
and such other facilities and services suitable to his position and adequate
for
the performance of his duties hereunder; and will provide the Employee with
and
pay for covered (if reasonably available) and reserved parking.
9. Withholding.
Notwithstanding anything in this Agreement to the contrary, all payments
required to be made by the Company hereunder to the Employee or his estate
or
beneficiaries shall be subject to the withholding of such amounts relating
to
taxes as the Company may reasonably determine it should withhold pursuant to
any
applicable law or regulation. In lieu of withholding such amounts, in whole
or
in part, the Company may, in its sole discretion, accept other provisions for
payment of taxes and withholding as required by law, provided it is satisfied
that all requirements of law affecting its responsibilities to withhold have
been satisfied.
10. Termination
of Employment.
10.1 For
Cause.
The
Company may terminate the Employee’s employment at any time for “Cause”
(as
defined below). For the purposes of this Agreement, “Cause”
shall
mean (i) habitual drunkenness or any substance abuse which adversely affects
the
Employee’s performance of his job responsibilities; (ii) any illegal use of
drugs; (iii) commission of a felony (including, without limitation, any
violation of the Foreign Corrupt Practices Act); (iv) dishonesty materially
relating to the Employee’s employment; (v) any misconduct by the Employee which
would cause the Company to violate any state or federal law relating to sexual
harassment or age, sex or other prohibited discrimination, or any intentional
violation of any written policy of the Company or any successor entity adopted
in respect to any such law; (vi) any other conduct in the performance of the
Employee’s employment which the Employee knows or should know (either as a
result of a prior warning by the Company, custom within the industry or the
flagrant nature of the conduct) violates applicable law or causes the Company
to
violate applicable law in any material respect; (vii) failure to follow the
lawful written instructions of the Board, if such failure continues uncured
for
a period of 10 days after receipt by the Employee of written notice from the
Company stating that continuation of such failure would constitute grounds
for
termination for Cause; (viii) any violation of the confidentiality or
non-competition provisions hereof; or (ix) any other material violation of
this
Agreement.
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10.2 Upon
Death or Disability.
The
employment of the Employee shall automatically terminate upon the death of
the
Employee and may be terminated by the Company upon the “Disability”
(as
defined below) of the Employee. For purposes of this Section 10.2, the Employee
shall be deemed “Disabled”
(and
termination of his employment shall be deemed to be due to such “Disability”)
if an
independent medical doctor (selected by the Company’s applicable health or
disability insurer) certifies that the Employee, for a cumulative period of
more
than 120 days during any 365-day period, has been disabled in a manner which
seriously interferes with his ability to perform the essential functions of
his
job even with a reasonable accommodation to the extent required by law. Any
refusal by the Employee to submit to a medical examination for the purpose
of
certifying Disability shall be deemed conclusively to constitute evidence of
the
Employee’s Disability.
10.3 For
Convenience of the Company.
Notwithstanding any other provisions of this Agreement, the Company shall have
the right, upon ninety (90) days written notice to the Employee, to terminate
the Employee’s employment at the “Company’s
Convenience”
(i.e.,
for reasons other than Cause, resignation for reasons other than “Good
Reason”
[as
defined below], death or Disability). For purposes hereof, resignation by the
Employee for Good Reason also shall be deemed to constitute termination by
the
Company at the Company’s Convenience.
10.4 Resignation;
Good Reason.
(a) The
Employee shall have the right to resign at any time upon ninety (90) days’
written notice to the Company.
(b) For
the
purposes of this Agreement, resignation by the Employee as a result of the
following shall be deemed to constitute resignation for “Good
Reason,”
provided that and on condition that the Employee has not consented to the action
constituting Good Reason and such resignation occurs within 15 days following
the occurrence of such action (or, in the case of clause (iv) below, following
the expiration of the 45-day cure period), and that the Employee is not Disabled
(or incapacitated in a manner which would, with the passage of time and
appropriate doctor’s certification, constitute Disability) at the time of
resignation: (i) a transfer of the Company’s offices, or a transfer of the
Employee (other than on a temporary basis), to a location which would increase
the Employee’s commute (by the most direct route) from his residence as of the
date hereof by more than 25 miles in each direction, or (ii) a material adverse
change made by the Company to the Employee’s duties, responsibilities and/or
working conditions such that such duties, responsibilities and/or working
conditions are inappropriate and not customary for a president and chief
executive officer of a similarly situated company, or (iii) a material breach
by
the Company of this Agreement which breach continues uncured for a period of
45
days after receipt by the Company of written notice thereof from the Employee
specifying the breach.
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11. Effect
of Termination on Compensation.
11.1 Termination
for Cause; Resignation.
In the
event (i) the Employee’s employment with the Company is terminated by the
Company for Cause, or (ii) the Employee resigns (for reasons other than Good
Reason), the Company shall have no further liability to the Employee hereunder,
whether for salary, benefits, or otherwise, other than for salary and benefits
accrued, reimbursement of expenses properly incurred, payment for all accrued
vacation calculated in accordance with the Company’s standard payroll practices,
in each case through the date of termination or resignation, and any other
benefits required by applicable law (e.g., COBRA) for which the Employee may
be
eligible.
11.2 Death
or Disability.
In the
event the Employee’s employment with the Company terminates as a result of the
death of the Employee or is terminated by the Company as a result of the
Disability of the Employee, the Employee or, in the event of his death, his
surviving spouse (or his estate, if there is no surviving spouse), shall be
entitled to receive his salary and benefits accrued, reimbursement of expenses
properly incurred and payment for all accrued vacation calculated in accordance
with the Company’s standard payroll practices, in each case through the date of
termination, as well as applicable health, disability or death benefits, if
any,
offered by the Company at the time consistent with the policies of the Company
and subject to the eligibility requirements of such benefits.
11.3. The
Company’s Convenience or Good Reason.
(a) In
the
event the Employee’s employment with the Company is terminated by the Company at
the Company’s Convenience or by the Employee for Good Reason, then the Employee
shall be entitled to (i) continue to receive his Salary for the duration of
the
Term, and (ii) continue to participate in the Company’s health and benefit plans
and programs described in Section 6 (but specifically excluding the vacation
benefit described in Section 7) for the duration of the Term (provided that
continued participation during such period does not cause a plan, program or
practice to cease to be qualified under any applicable law or regulation and
is
permitted by the plan or program, and that continuation under any such plan,
program or practice shall be limited to benefits customarily provided by the
Company to its senior executives during the period of such continuation, and
provided further that any such plan or program shall be subject to modifications
applicable to executive-level employees generally). Such compensation,
allowances and benefits shall continue to be paid or provided at the times
and
in the manner consistent with the standard payroll practices of the Company
for
its active executive-level employees. In addition, the Employee shall be
entitled to receive his salary and benefits accrued, reimbursement of expenses
properly incurred and payment for all accrued vacation calculated in accordance
with the Company’s standard payroll practices, in each case through the date of
termination. Except as provided in this Section, no other compensation or
benefits hereunder shall be payable during the balance of the Term. The
foregoing benefits are in lieu,
inter alia,
of any
notice obligation on the part of the Company.
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(b) As
a
condition to receiving the severance benefits described in clause (a) above,
the
Employee shall be required to execute and deliver to the Company, and not to
have revoked, the written confirmation described in Section 13 and a general
release of all claims the Employee may have against the Company or Argan and
their respective subsidiaries and affiliates, and the officers, directors,
shareholders and agents of each of them, in each case in such form as may be
reasonably requested by the Company, including without limitation all claims
for
wrongful termination, for employment discrimination under Title VII of the
Civil
Rights Act of 1964, as amended, and claims under the Americans with Disabilities
Act of 1990, the Equal Pay Act of 1963, the Age Discrimination in Employment
Act
of 1967, the Older Workers Benefit Protection Act of 1990, the Civil Rights
Act
of 1866, the Family and Medical Leave Act of 1993, the Civil Rights Act of
1991,
the Employee Retirement Income Security Act of 1974 and any equivalent state,
local and municipal laws, rules and regulations). Notwithstanding the foregoing,
the Employee shall not be required to release any claims (i) for unpaid
compensation or other benefits remaining unpaid by the Company at the time
of
termination, but may be required to agree upon and acknowledge the amount,
if
any, thereof remaining unpaid if such amount is calculable at the time, and
(ii)
which the Employee may have in connection with any unexercised Stock Options
granted pursuant to Section 5.
(c) Upon
the
occurrence of any material breach of this Agreement after the effective date
of
employment termination (it being understood that, without limitation, any breach
of Sections 12, 13 or 14 of this Agreement shall be deemed material), the
Company shall have no further liability to pay severance benefits hereunder
and
may, in addition to exercising any other remedies it may have hereunder or
under
law, immediately discontinue payment of remaining unpaid severance
benefits.
11.4 Adjustments
to Comply with American Jobs Creation Act.
In the
event any of the severance payment provisions of this Section should prove
to be
inconsistent with the requirements of Section 409A of the Internal Revenue
Code
of 1986, as amended, or the regulations thereunder, the Company and the Employee
shall endeavor to amend those severance payment provisions in order to eliminate
any inconsistency with Section 409A while ensuring, to the greatest extent
possible, that the Employee will continue to be entitled to the benefits
provided under this Agreement without increase in the economic cost to either
party.
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12. Confidentiality.
The
Employee recognizes and acknowledges that certain information possessed by
the
Company and its affiliates constitutes valuable, special, and unique proprietary
information and trade secrets. Accordingly, the Employee shall not, during
the
term of his employment with the Company,
divulge,
use, furnish, disclose or make available to any person, whether or not a
competitor of the Company, any confidential or proprietary information
concerning the assets, business, or affairs of the Company, of any affiliate
of
the Company or of its suppliers, customers, licensees or licensors, including,
without limitation, any information regarding trade secrets and information
(whether or not constituting trade secrets) concerning sources of supply, costs,
pricing practices, financial data, business plans, employee information,
manufacturing processes, product designs, production applications and technical
processes (hereinafter called “Confidential
Information”),
except as may be required by law or as may be required in the ordinary course
of
performing his duties hereunder. The foregoing shall not be applicable to any
information which now is or hereafter shall be in the public domain other than
through the fault of the Employee. Upon the expiration or termination of the
Employee’s employment, for any reason, whether voluntary or involuntary and
whether by the Company or the Employee, or at any time the Company may request,
the Employee shall (a) surrender to the Company all documents and data of any
kind (including data in machine-readable form) or any reproductions (in whole
or
in part) of any items relating to the Confidential Information, as well as
information stored in an electronic or digital format, containing or embodying
Confidential Information including without limitation internal and external
business forms, manuals, notes, customer lists, and computer files and programs
(including information stored in any electronic or digital format), and shall
not make or retain any copy or extract of any of the foregoing, and (b) will
confirm in writing that (i) no Confidential Information exists on any computers,
computer storage devices or other electronic media that were at any time within
the Employee’s control (other than those which remain at, or have been returned
to, the Company) and (ii) he has not disclosed any Confidential Information
to
others outside of the Company in violation of this Section. The Company shall
have the right at any time at its option to replace the hard drive in the
Employee’s laptop or other computer supplied by the Company with another
equivalent hard drive. As used in this Agreement, “affiliate”
means,
with respect to the Company or any other entity, any person or entity
controlling, controlled by or under common control with, the Company or such
other entity, including without limitation Argan, and “control”
for
such purpose means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a person or
entity, whether through the ownership of voting securities or voting interests,
by contract or otherwise.
13. Rights
in the Company’s Property; Inventions.
(a) The
Employee hereby recognizes the Company’s proprietary rights in the tangible and
intangible property of the Company and acknowledges that notwithstanding the
relationship of employment, the Employee will not obtain or acquire, and has
not
obtained or acquired, through such employment any personal property rights
in
any of the property of the Company, including without limitation any writing,
communications, manuals, documents, instruments, contracts, agreements, files,
literature, data, technical information, secrets, formulas, products, methods,
mailing lists, business models, business plans, procedures, processes, devices,
apparatuses, trademarks, trade names, trade styles, service marks, logos,
copyrights, patents, or other matters which are the property of the
Company.
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(b) The
Employee agrees that during the Term of his employment with the Company and
for
a period of three (3) months thereafter, any and all discoveries, inventions,
improvements and innovations (including all data and records pertaining thereto)
(“Inventions”),
whether or not patentable, copyrightable or reduced to writing, which the
Employee may have conceived or made, or may conceive or make, either alone
or in
conjunction with others and whether or not during working hours or by the use
of
the facilities of the Company, which are related or in any way connected with
the Business of the Company and the Affiliates or any affiliate, are and shall
be the sole and exclusive property of the Company. The Employee shall promptly
disclose all such Inventions to the Company, shall execute at the request of
the
Company any assignments or other documents the Company may deem necessary to
protect or perfect its rights therein, and shall assist the Company, at the
Company’s expense, in obtaining, defending and enforcing the Company’s rights
therein. The Employee hereby appoints the Company as his attorney-in-fact to
execute on his behalf any assignments or other documents deemed necessary by
the
Company to protect or perfect its rights to any Inventions.
14. Non-Competition,
Non-Solicitation Covenants.
14.1 Covenant
Not to Compete.
At all
times during the Term and for a period of two years after the Term (the
“Restrictive
Period”),
the
Employee shall not, directly or indirectly, alone or with others, engage in
any
competition with, or have any financial or ownership interest in any sole
proprietorship, corporation, company, partnership, association, venture or
business or any other person or entity (whether as an employee, officer,
director, partner, manager, member, agent, security holder, creditor, consultant
or otherwise) that directly or indirectly (or through any affiliated entity)
competes with the Business of the Company and the Affiliates; provided that
such
provision shall not apply to (i) the Employee’s ownership of Argan stock, (ii)
the Employee’s ownership of interests in entities which may develop, own and
operate (but not design or build) power plants, or (iii) the acquisition by
the
Employee, solely as an investment, of securities of any issuer that is
registered under Section 12(b) or 12(g) of the Securities Exchange Act of 1934,
as amended, and that are listed or admitted for trading on any United States
national securities exchange or that are quoted on the Nasdaq Stock Market,
or
any similar system or automated dissemination of quotations of securities prices
in common use, so long as the Employee does not control, acquire a controlling
interest in, or become a member of a group that exercises direct or indirect
control of, more than 5% of any class of capital stock or other indicia of
ownership of such issuer. For purposes of clause (ii) of this Section 14.1
above, and for clause (b) of Section 14.2 below, “develop” or “development of”
power plants shall mean the usual and customary actions taken by an owner or
potential owner of a power plant to obtain licenses, permits or other
governmental approvals required in order to own and operate a power plant,
but not the designing or constructing of a power plant.
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14.2 Non-Solicitation.
At all
times during the Restrictive Period, the Employee shall not, directly or
indirectly, for himself or for any other person, firm, corporation, company,
partnership, association, venture or business or any other person or entity:
(a)
solicit for employment, employ or attempt to employ or enter into any
contractual arrangement with any employee or former employee (which, for
purposes of this Section 14.2 shall mean anyone employed during the 24 month
period ending on the date of termination of the Employee’s employment with the
Company) of the Company, the Affiliates, or Argan or any affiliate or subsidiary
of Argan, except Xxxxxxx X. Xxxxxxx and Xxxx Xxxxxx; and/or (b) call on or
solicit any of the actual or targeted prospective customers or clients, or
any
actual distributors or suppliers, of the Company (except in connection with
the
Employee’s development, ownership and operation (but not the designing or
building) of power plants), the Affiliates, or Argan or any affiliate or
subsidiary of Argan on behalf of himself or on behalf of any person or entity
in
connection with any business that competes with the Business of the Company
and
the Affiliates, nor shall the Employee make known the names or addresses or
other contact information of such actual or prospective customers or clients,
or
any such actual distributors or suppliers, or any information relating in any
manner to the Company’s, or the Affiliates’ or Argan’s or any subsidiary or
affiliate of Argan’s trade or business relationships with such actual or
prospective customers or clients, or any such actual distributors or suppliers,
other than in connection with the performance by the Employee of his duties
under this Agreement.
15. Acknowledgment
by the Employee.
The
Employee acknowledges and confirms that the restrictive covenants contained
in
Sections 12, 13 and 14 hereof (including without limitation the length of the
term of the provisions of Section 14) are required by the Company as an
inducement to enter into this Agreement, are reasonably necessary to protect
the
legitimate business interests of the Company, and are not overbroad, overlong,
or unfair and are not the result of overreaching, duress or coercion of any
kind. The Employee further acknowledges that the restrictions contained in
Sections 12, 13 and 14 hereof are intended to be, and shall be, for the benefit
of and shall be enforceable by the Company and its successors and assigns.
The
Employee expressly agrees that upon any breach or violation of the provisions
of
Sections 12, 13, or 14 hereof, the Company shall be entitled, as a matter of
right, in addition to any other rights or remedies it may have, to: (a)
temporary and/or permanent injunctive relief in any court of competent
jurisdiction as described in Section 16 hereof; and (b) such damages as are
provided at law or in equity. The existence of any claim or cause of action
against any of the Company, the Affiliates, or Argan or their respective
subsidiaries or affiliates, whether predicated upon this Agreement or otherwise,
shall not constitute a defense to the enforcement of any of the restrictions
contained in Sections 12, 13 or 14 hereof.
16. Enforcement;
Modification.
16.1 Injunction.
It is
recognized and hereby acknowledged by the parties hereto that a breach by the
Employee of any of the covenants contained in Sections 12, 13 or 14 of this
Agreement will cause irreparable harm and damage to the Company, the monetary
amount of which may be virtually impossible to ascertain. As a result, the
Employee recognizes and hereby acknowledges that the Company shall be entitled
to an injunction from any court of competent jurisdiction enjoining and
restraining any violation of any or all of the covenants contained in Sections
12, 13 or 14 of this Agreement by the Employee or any of his affiliates,
associates, partners or agents, either directly or indirectly, and that such
right to injunction shall be cumulative and in addition to whatever other
remedies the Company may possess.
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16.2 Reformation
by Court.
In the
event that a court of competent jurisdiction shall determine that any provision
of Sections 12, 13 or 14 is invalid or more restrictive than permitted under
the
governing law of such jurisdiction, then only as to enforcement of Sections
12,
13 or 14 within the jurisdiction of such court, such provision shall be
interpreted or reformed and enforced as if it provided for the maximum
restriction permitted under such governing law.
16.3 Extension
of Time.
If the
Employee shall be in violation of any provision of Sections 12, 13 or 14, then
each time limitation set forth in Sections 12, 13 or 14 shall be extended for
a
period of time equal to the period of time during which such violation or
violations occur. If the Company seeks injunctive relief from such violation
in
any court, then the covenants set forth in Sections 12, 13 and 14 shall be
extended for a period of time equal to the pendency of such proceeding including
all appeals by either of the Sellers.
16.4 Survival.
The
provisions of Sections 12, 13 and 14 shall survive the termination of this
Agreement.
16.5 Purchase
Agreement.
Notwithstanding anything to the contrary contained in this Agreement, nothing
herein shall limit or otherwise affect the restrictive covenants applicable
to
the Employee, as Seller, under and pursuant to the terms, covenants and
conditions of the Purchase Agreement, including without limitation the covenant
not to compete for a period of five years from the Closing Date (as defined
in
the Purchase Agreement), all of which such restrictive covenants shall remain
in
full force and effect in accordance with the terms and conditions of the
Purchase Agreement.
17. Assignment.
The
Company shall have the right to assign this Agreement and its rights and
obligations hereunder in whole, but not in part, to any corporation or other
entity with or into which the Company may hereafter merge or consolidate or
to
which the Company may transfer all or substantially all of its assets, if in
any
such case said corporation or other entity shall by operation of law or
expressly in writing assume all obligations of the Company hereunder as fully
as
if it had been originally made a party hereto, but may not otherwise assign
this
Agreement or its rights and obligations hereunder. The Employee may not assign
or transfer this Agreement or any rights or obligations hereunder.
18. Benefits;
Binding Effect.
This
Agreement shall be for the benefit of and binding upon the parties hereto and
their respective heirs, personal representatives, legal representatives,
successors and, where permitted and applicable, assigns, including, without
limitation, any successor to the Company, whether by merger, consolidation,
sale
of stock, sale of assets or otherwise.
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19. Severability.
The
invalidity of any one or more of the words, phrases, sentences, clauses,
provisions, sections or articles contained in this Agreement shall not affect
the enforceability of the remaining portions of this Agreement or any part
thereof, all of which are inserted conditionally on their being valid in law,
and, in the event that any one or more of the words, phrases, sentences,
clauses, provisions, sections or articles contained in this Agreement shall
be
declared invalid, this Agreement shall be construed as if such invalid word
or
words, phrase or phrases, sentence or sentences, clause or clauses, provisions
or provisions, section or sections or article or articles had not been inserted.
If such invalidity is caused by length of time or size of area, or both, the
otherwise invalid provision will be considered to be reduced to a period or
area
which would cure such invalidity.
20. Waivers.
The
waiver by either party hereto of a breach or violation of any term or provision
of this Agreement shall not operate nor be construed as a waiver of any
subsequent breach or violation.
21. Damages;
Attorneys Fees.
Nothing
contained herein shall be construed to prevent the Company or the Employee
from
seeking and recovering from the other damages sustained by either or both of
them as a result of its or his breach of any term or provision of this
Agreement. In the event that either party hereto seeks to collect any damages
resulting from, or the injunction of any action constituting, a breach of any
of
the terms or provisions of this Agreement, then the party found to be at fault
shall pay all reasonable costs and attorneys’ fees of the other
party.
22. Section
Headings.
The
article, section and paragraph headings contained in this Agreement are for
reference purposes only, and shall not affect in any way the meaning or
interpretation of this Agreement.
23. No
Third Party Beneficiary.
Nothing
expressed or implied in this Agreement is intended, or shall be construed,
to
confer upon or give any person other than the Company, and the parties hereto
and their respective heirs, personal representatives, legal representatives,
successors and permitted assigns, any rights or remedies under or by reason
of
this Agreement.
24. Counterparts.
This
Agreement may be executed in one or more counterparts, each of which shall
be
deemed to be an original but all of which together shall constitute one and
the
same.
25. Governing
Law.
This
Agreement shall be governed by and construed and enforced in accordance with
the
internal laws of the State of Connecticut, without regard to principles of
conflict of laws.
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26. Jurisdiction
and Venue.
Each
of
the parties irrevocably and unconditionally: (a) agrees that any suit, action
or
legal proceeding arising out of or relating to this Agreement which is expressly
permitted by the terms of this Agreement to be brought in a court of law, shall
be brought in the Superior Court of the State of Connecticut for the Judicial
District of Hartford or in the United States District Court for the District
of
Connecticut; (b) consents to the jurisdiction of each such court in any such
suit, action or proceeding; (c) waives any objection which it or he may have
to
the laying of venue of any such suit, action or proceeding in any of such
courts; and (d) agrees that service of any court papers may be effected on
such
party by mail, as provided in this Agreement, or in such other manner as may
be
provided under applicable laws or court rules in such courts.
27. Entire
Agreement.
This
Agreement constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof and, upon its effectiveness, shall
supersede all prior agreements, understandings and arrangements, both oral
and
written, between the Employee and the Company (or any of its affiliates) with
respect to such subject matter. This Agreement may not be modified in any way
unless by a written instrument signed by both the Company and the
Employee.
28. Notices.
All
notices required or permitted to be given hereunder shall be in writing and
shall be personally delivered by courier, sent by registered or certified mail,
return receipt requested, sent by overnight courier, or sent by confirmed
facsimile transmission addressed as set forth herein. Notices personally
delivered, sent by facsimile or sent by overnight courier shall be deemed given
on the date of delivery and notices mailed in accordance with the foregoing
shall be deemed given upon the earlier of receipt by the addressee, as evidenced
by the return receipt thereof, or three days after deposit in the U.S. mail.
Notice shall be sent: (a) if to the Company, addressed to the Company, Xxx
Xxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxx 00000, Attention: Xxxxxx X.
Xxxxxx; and (b) if to the Employee, to his address as reflected on the payroll
records of the Company, or to such other address as either party shall request
by notice to the other in accordance with this provision.
[SIGNATURES
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IN
WITNESS WHEREOF,
each of
the undersigned has executed, or has caused its duly authorized representative
to execute, this Agreement as of the date first above written.
|
THE
COMPANY:
GEMMA POWER SYSTEMS, LLC
|
||
| |
|
|
| By: | /s/ Xxxxxxx X. Xxxxxxx, Xx. | |
|
Name: Xxxxxxx X. Xxxxxxx, Xx. Title: Manager |
||
| THE EMPLOYEE: | ||
|
|
||
| /s/ Xxxxxxx X. Xxxxxxx, Xx. | ||
|
XXXXXXX X. XXXXXXX, XX
|
||
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