EMPLOYMENT AGREEMENT
Exhibit 10.4
THIS EMPLOYMENT AGREEMENT is entered into as of the 1st day of August 2005, by and
between Meadow Valley Corporation, a Nevada corporation (the “Employer”), and Xxxx X. Xxxxxx (the
“Employee”).
The Employer hereby employs the Employee on a full-time basis, and the Employee
hereby accepts such full-time employment on the terms and conditions hereinafter set
forth.
1. EMPLOYMENT.
Employee is employed as the Senior Vice President - Chief Operating
Officer (“COO”) for the Employer. Employee shall perform all duties as outlined herein and as may
be assigned by the Employer and shall devote full time, attention and loyalty to the affairs of
the Employer. The duties of the Employee shall specifically be:
A) Oversee all operating entities of the Employer. Reporting to Xxxx
Xxxxxx will be each Area Manager for the Nevada and Arizona Areas, and the
President of Ready Mix, Inc.
B) Assist operating units in decision-making relative to work bidding,
margins bid, and preparation and submission of estimates,
C) Assist operating units to maximize profitability by active
participation in project planning, problem-solving, partnering, and
claims/litigation preparation.
D) Assist and oversee operating budgets, capital expenditure budgets
and approve project specific budgets for use in the Company’s Budget Bonus
Incentive Program.
E) Oversee and delegate as necessary administration of the Company’s
equipment and other resources. The COO is responsible for decision-making
regarding the types of equipment acquired in capital purchases and leases.
F) Assist in selection and evaluation of merger and/or acquisition
opportunities of the Company.
G) Assist in formulating and executing strategic plans.
H) Any other area specifically assigned by the Chief Executive Officer (“CEO”) or the
Board of Directors.
I) To maintain and promote relationships with owners with whom the Company contracts.
2. TERM. Subject to the provisions of termination provided in paragraph 12, the term
of this Agreement shall be three years from the date of execution or from the date of the most
recent renewal. Subject to a mandatory annual review (“Review”) of the Employee’s performance by
the CEO, this Agreement may be renewed annually if the outcome of the Review results in a
recommendation for renewal by the CEO to the Board Compensation Committee (“Committee”) and the
Committee, by majority vote, authorizes the renewal.
3. COMPENSATION. Employee shall receive a base salary of One
Hundred Fifty Thousand Dollars ($150,000.00) per year, payable in accordance with the
regular payroll practices of Employer, and subject to applicable deductions of
withholding taxes and other customary employment taxes. The CEO of Employer shall
review Employee’s salary at a minimum annually and may adjust Employee’s salary
upward to recognize improvement, achievement or’expansion of Employee’s
responsibilities subject to approval of the Committee.
Employee shall participate as a member of senior management in cash incentive plans as
currently existing or as amended or adopted in the future by the Committee. Cash bonus plans are
subject to annual review and/or change by the Committee.
4. OPTIONS
TO ACQUIRE COMMON STOCK. Employee is eligible
to participate in the Meadow Valley Corporation 1994 Stock Option Plan. Future grants
of stock options shall be subject to the discretion of Meadow Valley Corporation’s board
of directors.
5. EMPLOYEE
BENEFITS. Employer shall provide to Employee, and to the Employee’s
dependents, a comprehensive major medical, health, and dental insurance
program comparable to the programs normally provided by other employers in the same
industry and marketplace, and the Employer shall pay the cost of the Employee’s portion
of the premium. Should, at any time, the Employee opt to maintain a personal major
medical and health insurance policy for himself and for his dependents and not participate
in the Employer’s group plan, then Employer shall reimburse Employee the lesser of the
amount Employee pays for said personal policy, as evidenced by adequate
documentation, or what Employer would otherwise be paying were Employee
participating in the Employer’s group plan. Should the Employee opt to maintain his own
coverage, neither he nor his dependents shall be precluded from later participating in the
Employer’s group plan so long as they otherwise qualify for enrollment.
At Employer’s cost, Employer will maintain a life insurance policy covering Employee, with at
least $500,000 of death benefits being payable, in a manner that is free of income tax, to
Employee’s estate or other beneficiaries designated by Employee.
Employer agrees to provide Employee with an automobile for business-related use. In addition
to the cost of the vehicle itself, Employer shall pay, directly or by reimbursement to Employee,
for all maintenance, fuel, repairs, insurance, operating and other costs incidental thereto.
Employer shall pay for, or reimburse Employee for, dues for his membership in industry related
associations perceived as beneficial to Employer and as approved by the CEO.
So long as it is within the guidelines of the respective plan, Employee shall be given the
opportunity to participate in Employer’s 401(k) and any other plans made available to other members
of executive management.
Employee shall be entitled to receive all other employee benefits for senior management
personnel upon the terms and conditions then in effect, including long term disability insurance.
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6. MOVING EXPENSES AND SUBSISTENCE. In the event the Employer requires the
Employee to relocate, the Employer shall pay for all moving costs of reasonable and normal
household effects, including up to six months storage of such household effects while Employee
obtains a permanent residence in the relocation area. Employee shall obtain a minimum of two
moving and storage quotes from reputable movers and Employer shall pay the most competitive rate.
Employer shall provide Employee a subsistence allowance of Two Thousand Dollars ($2,000.00)
per month for the lesser of nine months from the date of reassignment in a new location or until
such time as the relocation of Employee and his/her spouse to the relocation area is complete. In
addition, costs for one round-trip airline ticket per week between the Employee’s previous
location and the relocation area will be reimbursed by Employer to Employee during the same
nine-month period, or less if relocation is completed earlier. Such tickets may be used either by
Employee or by his/her spouse.
7. HOLIDAYS AND VACATION.
A) Employee shall be paid for the following seven (7) holidays: New
Year’s Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
the day after Thanksgiving, and Christmas Day and all other holidays for
Employees of the Company as approved by the Chief Executive Officer or Board
of Directors.
B) Employee is entitled to four weeks vacation during the first year of
employment and for each year thereafter. Unused vacation in any given year shall
accrue to following years up to a maximum of eight weeks in any one year.
8. RESPONSIBILITIES OF EMPLOYEE. The Employee shall devote
such reasonable time as is necessary or is deemed reasonably necessary by the Employer
to carry out all required duties and will devote full time to the Employer during normal
business hours. The Employee shall at all times faithfully, with diligence and to the
Employee’s best good faith ability, experience and talents, perform all the duties that may
be required pursuant to the express terms hereof to the reasonable satisfaction of the
Employer, in accordance with customary professional standards.
9. WORKING FACILITIES. The Employee shall be furnished with all
facilities and services suitable to Employee’s position and adequate for the performance
of Employee’s duties.
10. EXPENSES. The Employee is authorized to incur reasonable expenses
for promoting business of the Employer, including expenses for entertainment, travel and
similar items. The Employer shall reimburse the Employee for all such expenses on the
presentation by the Employee of itemized and adequately documented accounts of such
expenditures.
11. DISABILITY. If unable to perform duties under the terms of this Agreement
by reason of illness or incapacity for a period of four weeks, Employee shall,
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commencing at the end of such four week period, be entitled to receive Employee’s compensation
hereunder for a period of up to and including a maximum of one year or until he is no longer
disabled, whichever occurs first. After one year of disability at full salary, the Employee, or his
designated beneficiary, shall be provided with a disability insurance policy, if available, at no
cost to Employee. The disability income policy would provide for monthly income benefits at the
rate of sixty percent (60%) of the Employee’s base salary at the time the disability occurred. The
Company will attempt to procure a disability income policy that would provide monthly benefits
until the Employee reaches 65 years of age or is no longer disabled whichever occurs first. If such
a policy is unavailable, the Company will attempt to provide the best policy available. If no
policy is available, no other disability income benefits will be provided.
12.
TERMINATION. This Employment Agreement may be terminated under the following
circumstances:
A) WITHOUT CAUSE. Employer may terminate this Agreement at
any time upon thirty (30) days written notice to Employee, but Employer shall be
obligated to pay to Employee compensation in a lump sum for the balance of the
term of this Agreement within 30 days of termination, unless Employee agrees to
other payment terms.
B)
VOLUNTARY TERMINATION BY EMPLOYEE WITHOUT CAUSE. Employee may terminate this Agreement at any time upon thirty (30)
days written notice to Employer and Employer shall be obligated, in that event, to
pay Employee compensation up to the date of the termination only. All accrued
but unpaid compensation and Employee benefits shall be paid in cash within 30
days of termination, unless Employee agrees to other payment terms.
C)
TERMINATION BY EMPLOYER FOR REASONABLE CAUSE. The Employer may terminate this Agreement for reasonable cause upon
the unanimous vote of the Board of Directors and by thirty (30) days written
notice to the Employee and Employer shall be obligated, in that event, to pay
Employee compensation up to the date of termination only. For purposes hereof,
“cause” shall be defined as meaning (i) such conduct by the Employee which
constitutes material breach of this Agreement which is not cured within ninety
(90) days of written notice to the Employee of said alleged breach or (ii) a
material failure to competently perform Employee’s duties as stated in paragraph 1
in accordance with applicable professional standards as stated in paragraphs 1 and
8 hereof provided that Employer has previously given Employee written notice
and a reasonable opportunity to remedy such failure and such failure has a
materially adverse effect on the business or financial condition of Employer or
(iii) material breach of Employee’s fiduciary duty and such breach has a material
adverse effect on the business or financial condition of Employer or (iv)
egregiously improper or illegal conduct of the Employee which, based upon a
unanimous good faith determination of the Board of Directors of the Employer,
has a material adverse affect on Employer.
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D) TERMINATION BY EMPLOYEE FOR REASONABLE CAUSE. Employee may terminate this
Agreement for cause. In such event, Employer shall be obligated to pay Employee
compensation in lump sum for the balance of the term of this Agreement within 30 days of
termination or as Employee shall agree, plus damages suffered and expenses incurred by
reason thereof. For this purpose “cause” shall mean (i) a material breach of this
Agreement by Employer or (ii) failure of Employer to pay any amount owed Employee
hereunder at the time and in the amount due or (iii) failure of Employer to follow
applicable law, especially with respect to SEC filings and compliance over the objection
of Employee or contrary to the reasonable advice of Employee or (iv) egregiously improper
conduct with respect to dealing with Employee or in a manner which brings discredit to
Employee.
13. CONFIDENTIALITY. Employee agrees not to disclose any
confidential, proprietary competitively sensitive information to persons who are not
employees, directors, lenders, bonding agents, insurance companies or advisors of the
Employer, except as required by law, without prior consent of the Employer; provided
however, any disclosure involving this paragraph shall not result in a breach of this
Agreement unless the disclosure has a materially adverse effect on the Employer.
14. INDEMNIFICATION. Employer and Meadow Valley Contractors, Inc.
shall provide Employee with an Officer Indemnification Agreement in the form attached
hereto.
15. NOTICES. All notices, demands, and communications given under this Agreement
(“Notice”) shall be in writing and delivered personally or sent by registered or certified mail,
return receipt requested, in the United States mail, postage prepaid, addressed as follows:
If to Employer:
If to Employee:
Xxxx X. Xxxxxx
X.X. Xxx 000
Xxxxxxx, XX 00000
X.X. Xxx 000
Xxxxxxx, XX 00000
or at such other address as a party may from time to time designate by Notice hereunder. Notice
shall be effective upon delivery in person, or if mailed, at midnight on the third business day
after the date of mailing.
16. ASSIGNMENT OF AGREEMENT. Neither party may assign or otherwise transfer this
Agreement or any of its rights or obligations hereunder without the
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prior written consent to such assignment or transfer by the other party hereto; and all the
provisions of this Agreement shall be binding upon the respective employees, successors, heirs and
assigns of the parties; provided, however, the benefits payable to Employee hereunder in the event
of disability or death or incapacity are payable to Employee’s spouse or personal representative.
17. SURVIVAL
OF REPRESENTATIONS, WARRANTIES AND COVENANTS. This Agreement and the representations, warranties, covenants and other
agreements (however characterized or described) by both parties and contained herein or made
pursuant to the provisions hereof shall survive the execution and delivery of this Agreement.
18. FURTHER INSTRUMENTS. The parties shall execute and deliver any
and all such other instruments in reasonable mutually acceptable form and substance and
shall take any and all such other actions as may be reasonably necessary to carry the intent
of the Agreement into full force and effect.
19. SEVERABILITY. If any provision of this Agreement shall be held,
declared or pronounced void, voidable, invalid, unenforceable or inoperative for any
reason by any court of competent jurisdiction, governmental authority or otherwise, such
holding, declaration or pronouncement shall not affect adversely any other provision of
this Agreement, which shall otherwise remain in full force and effect and be enforced in
accordance with its terms, and the effect of such holding, declaration or pronouncement
shall be limited to the territory of jurisdiction in which made.
20. WAIVER. All the rights and remedies of either party under this
Agreement are cumulative and not exclusive of any other rights and remedies provided by
law. No delay or failure on the part of either party in the exercise of any right or remedy
arising from a breach of this Agreement shall operate as a waiver of any subsequent right
or remedy arising from a subsequent breach of this Agreement. The consent of any party
where required hereunder to any act or occurrence shall not be deemed to be a consent to
any other act or occurrence.
21. GENERAL PROVISIONS. This Agreement shall be construed and
enforced in accordance with, and governed by, the laws of the state of Arizona. Except as
otherwise expressly stated herein, time is of the essence in performing under this
Agreement. This Agreement embodies the entire agreement and understanding between
the parties and supersedes all prior agreements and understandings relating to the subject
matter of this Agreement as it relates to the parties’ duties and obligations from and after
April 1, 1997, and this Agreement may not be modified or amended or any term or
provision hereof waived or discharged except in writing signed by the party against whom
such amendment, modification, waiver or discharge is sought to be enforced. The
headings of this Agreement are for convenience in reference only and shall not limit or
otherwise affect the meaning thereof. This Agreement may be executed in any number of
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counterparts, each of which shall be deemed an original but all of which taken together shall
constitute one and the same instrument.
22. SPECIAL RIGHT OF EMPLOYEE UNDER CERTAIN CIRCUMSTANCES. During the term of this
Agreement, if Meadow Valley Corporation is involved in a merger, consolidation or other business
combination in which Meadow Valley Corporation is not the surviving and controlling entity and as a
result thereof the Employee is required to relocate outside the city of his/her current residence
in a manner not objectively reasonable, then Employee shall have the following rights:
A) To terminate this Agreement with 30 days prior notice, in which event
Employer shall pay Employee a sum equal to the Employee’s compensation for the
remainder of the term of this Agreement, payable within fourteen calendar days of the
date of termination; and
B) All options granted shall, to the extent not specifically prohibited by the
stock option plan then in effect, vest immediately and be exercisable within one year of
the termination notice provided in A above.
The provisions of this Section 22 shall supercede the entitlements set forth in paragraph 12
Termination in the events contemplated within this Section 22.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first above
written.
| Meadow Valley Corporation | |||
/s/
Xxxx X. Xxxxxx
|
By | /s/ Xxxxxxx X. Xxxxxx | |
Employee
|
Chairman — Compensation Committee | ||
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