Exhibit 10.24
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement (this "Agreement") is dated as of
January 22, 2007, between Aerospace Products International, Inc., a Delaware
corporation, 0000 Xxxxxxxxxx Xxxxx Xxxxx, Xxxxxxx, XX 00000 (the "Company"), and
Xxxx X. Xxxxxxxx, an individual, U.S. citizen, residing at 0000 Xxxxxxxxx Xxxx,
Xxxxxxxxx, XX 00000(xxx "Executive").
WITNESSETH:
WHEREAS, the Company believes that the Executive will be a valued
employee of the Company and wishes to secure his employment with the Company and
document the terms of the Executive's employment by the Company, and the
Executive wishes to become employed by the Company.
WHEREAS, the Company also has determined that it is in the best
interests of the Company and its shareholders to reinforce and encourage the
continued attention and dedication of certain key members of the Company's
management, including the Executive, to their assigned duties without
distraction in uncertain circumstances arising from the possibility of a change
in control of the Company.
NOW, THEREFORE, taking into account the foregoing and in consideration
of the mutual promises and conditions contained herein, the parties hereto agree
as follows:
I
EMPLOYMENT
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.1 Employment. The Company employs the Executive and the Executive
hereby accepts employment as its Chief Financial Officer (CFO) upon the terms
and conditions hereinafter set forth.
.2 Term. The employment of the Executive by the Company under the
terms and conditions of this Agreement will commence on January 22, 2007 and
continue, subject to Article IV hereof, for a period of two years, through
January 22, 2009 ("Employment Term").
.3 Executive Duties. As the Chief Financial Officer of the Company,
the Executive shall perform such duties customary to such office as are
reasonably requested by and shall report directly to the Company's President and
Chief Executive Officer. The Executive agrees to devote his full business time
(with allowances for vacations and sick leave) and attention and best efforts to
the affairs of the Company and its parent, subsidiaries and affiliates during
the Employment Term. Executive shall not, while an employee of the Company,
directly or indirectly, be engaged (including as a stockholder owning more than
five (5) percent of a company's stock, proprietor, general partner, limited
partner, trustee, consultant, employee, director, officer, lender, investor or
otherwise) in any business or activity that is competitive with that of the
Company, its parent or any of its subsidiaries, or affiliates.
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II
COMPENSATION AND BENEFITS
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.1 Base Salary. During the Employment Term, the Company shall pay
to the Executive an annualized base salary of One Hundred Seventy Thousand
Dollars ($170,000) per year (the "Base Salary"), payable in substantially equal
biweekly installments of Six Thousand Five Hundred Thirty Eight Dollars and
Forty Six Cents ($6538.46). The Company will review annually and may, but is not
required to, in the sole discretion of the Board of Directors of the Company,
increase such Base Salary in light of the Executive's performance, inflation in
cost of living, or other factors. The Company shall not decrease Executive's
Base Salary during the Employment Term unless other Executive Base Salaries have
been reduced as part of a program to increase profitability and cash flow.
.2 Signing Bonus. The Executive shall be paid Signing Bonus of
Twenty Thousand Dollars ($20,000) on the date of his first biweekly salary
payment after the commencement of the Employment Term. Should the Executive
leave the company prior to 24 months, the Executive shall reimburse a pro-rated
monthly amount to the company. For example, if the Executive leaves in 12
months, the Executive shall reimburse 1/2 of the bonus.
.3 Benefits. During the Employment Term, the Executive shall be
permitted to participate in and be covered under any and all such performance
bonus, profit sharing, and other compensation plans, and such medical, dental,
disability, life, and other insurance plans, as are generally available to other
employees of the Company in similar employment positions, subject to meeting
applicable eligibility requirements (collectively referred to herein as the
"Company Benefit Plans"). The award, amounts, and terms and conditions of all of
all bonuses and other Company Benefit Plans shall be determined from time to
time at the sole discretion of the Board of Directors.
.4 Reimbursement of Expenses. The Executive shall be entitled to
receive prompt reimbursement of all reasonable expenses incurred by the
Executive in performing services hereunder, including all reasonable expenses of
travel, entertainment and living expenses while away from home on business at
the request of, or in the service of, the Company, provided that such expenses
are incurred and accounted for in accordance with the policies and procedures
established by the Company.
.5 Relocation Expenses. The Company will assist in your moving
expense not to exceed $30,000. We will allow a period of 24 months for
relocation completion. With respect to your relocation to the Memphis area, the
Company offers you the following package: Below are examples of expenses that
can apply toward the 30k limit.
House hunting trip for you, your spouse and your child not to exceed 5 days.
Reimbursable expenses include airfare, rental car, hotel and meal expenses.
Reimbursement of reasonable and customary expenses for all business travel
between the start of your employment and your move to the Memphis area. Such
expenses include rental car, hotel and meals. (The Company will be happy to
assist you to help minimize these costs.)
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Reimbursement of reasonable and customary closing costs related to the purchase
of a comparably valued home in the Memphis area, excluding points and
commissions. In order to be reimbursed for closing costs, you must close within
one year of your start date with API.
Reimbursement of household moving expenses; In order to be reimbursed for moving
expenses, you must submit expense reports for all such expenses, including
receipts, to Employee Services.
Vacation and Holidays. The Executive shall be entitled to an annual
vacation leave of three (3) weeks at full pay or such greater vacation benefits
as may be provided for by the Company's vacation policies applicable to senior
executives of the Company. Up to a maximum of one week of vacation time may be
accumulated and carried over from one year to the next. Such carried over
vacation time is not to exceed one week cumulatively. Executive shall be
entitled to such holidays as are established by the Company for all employees.
III
CONFIDENTIALITY NONDISCLOSURE AND NON-COMPETITION
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.1 Confidentiality. Executive shall not, during Executive's
employment by the Company or for a period of seven (7) years thereafter, at any
time disclose, directly or indirectly, to any person or entity or use for
Executive's or any other person's or entity's benefit any trade secrets or
confidential information relating to the Company's, its parent's, subsidiaries'
or affiliates' businesses, operations, marketing data, business plans,
strategies, technology employees, products, prices, negotiations and contracts
with other companies, or any other subject matter pertaining to the business of
the Company or its parent, subsidiaries or affiliates or any of their respective
clients, customers, suppliers, consultants, or licensees, known, learned, or
acquired by Executive during the period of Executive's employment by the Company
(collectively "Confidential Information"), except as may be necessary in the
ordinary course of performing Executive's particular duties as an employee of
the Company. or with the Company's approval.
.2 Return of Confidential and Other Material. Executive shall
promptly deliver to the Company on termination of Executive's employment with
the Company, whether or not for Cause, or at any time the Company may so
request, all memoranda, notes, records, reports, manuals, drawings, blueprints,
rolodexes, computer equipment like PC, laptop, Blackberry, and PDA, computer
files and records, Confidential Information and any other documents of a
confidential or non-confidential nature belonging to the Company or its parent,
subsidiaries or affiliates, including all copies of such materials which
Executive may then possess or have under Executive's control and any notes of
Executive relating thereto whether in print-based or electronic media. Upon
termination of Executive's employment by the Company, Executive shall not retain
any document, data, or other material of any nature containing or pertaining to
the Confidential Information of the Company or its parent, subsidiaries or
affiliates.
.3 Prohibition on Solicitation of Customers. During Executive's
employment by the Company, and for a period of twelve (12) months thereafter,
Executive shall not, directly or indirectly, either for Executive or for any
other person or entity, solicit any person or entity to terminate such person's
or entity's contractual and/or business relationship with the Company or its
parent, subsidiaries or affiliates, nor shall Executive interfere with or
disrupt or attempt to interfere with or disrupt any such relationship. None of
the foregoing shall be deemed a waiver of any rights and remedies the Company
may have under applicable statutory or common law.
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.4 Prohibition on Solicitation of Employees, Agents or Independent
Contractors Termination. During Executive's employment by the Company and for a
period of twelve (12) months thereafter, Executive will not solicit to leave the
employ of the Company or its parent, subsidiaries or affiliates any person who
is, or who within 180 days before the termination of Executive's employment had
been, an employee, agent, or independent contractor of the Company or its
parent, subsidiaries or affiliates. None of the foregoing shall be deemed a
waiver of any rights and remedies the Company may have under applicable
statutory or common law.
.5 Non-Competition. During the Term of Executive's employment by
the Company, and thereafter until the later of: (i) six months after termination
of Executive's employment for any reason, or (ii) the last date on which
Executive is receiving severance benefits or other benefits pursuant to this
Agreement, he shall not, directly or indirectly, be engaged (including as a
stockholder, proprietor, general partner, limited partner, trustee, consultant,
employee, director, officer, lender, investor or otherwise) in any business or
activity that is competitive with that of the Company, its parent or any of its
subsidiaries, or affiliates, provided however that Executive may own any
securities of any entity which is engaged in such business and is publicly owned
or traded but in an amount not to exceed at any one time five per cent (5%)
outstanding of any class of stock or securities of such entity.
.6 Right to Injunctive and Equitable Relief. Executive's
obligations not to disclose or use "Confidential Information" and to refrain
from the solicitations and not to compete described in this Article III are of a
special and unique character. The Company and its parent, subsidiaries and
affiliates cannot be reasonably or adequately compensated for damages in an
action at law in the event Executive breaches such obligations. Therefore,
Executive expressly agrees that the Company and its parent, subsidiaries and
affiliates shall be entitled to injunctive and other equitable relief without
bond or other security in the event of such breach in addition to any other
rights or remedies which the Company or its parent, subsidiaries or affiliates
may possess or be entitled to pursue - under applicable statutory or common law.
Furthermore, the obligations of Executive and the rights and
remedies of the Company and its parent, subsidiaries and affiliates under this
Article III are cumulative and in addition to, and not in lieu of, any
obligations, rights, or remedies created by applicable statutory or common law.
The parties agree that all of the parent, subsidiaries and affiliates of the
Company shall be third party beneficiaries of this Article III and be entitled
to enforce directly against Executive the provisions of this Article III to the
extent that shall be related to the businesses of such parent, subsidiaries or
affiliates.
.7 Acknowledgement of Company Policies. Executive agrees to read,
execute and observe the terms of the API Code of Ethics, Confidentiality and
Nondisclosure Agreement, and such other standard Company policy forms relating
to ethics, confidentiality, non-solicitation, or business practices as may be
required to be executed from time to time by the other employees of the Company
in similar employment positions (the "Company Policies"), except that Executive
shall not be required to execute any agreement or policy form containing a
post-employment restriction on the solicitation of customers or a
post-employment prohibition on competition that contains a restriction period
which extends longer than the restriction period specified in the then-current
terms of his Executive Employment Agreement. The executive acknowledges that he
has not and will not bring or transfer any confidential materials from
Executive's prior employers. In the event of any conflict between the terms of
the Company Policies and the terms of this Agreement, the terms of the Company
Policies shall be controlling, except that with respect to a post-employment
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restriction on the solicitation of customers or a post-employment prohibition on
competition, if the restriction period specified in the then-current terms of
the Executive Employment Agreement is longer than the corresponding period set
forth in the Company Policy, the Executive Employment Agreement restrictive
period shall control.
.8 Survival of Obligations. Executive agrees that the terms of this
Article III and Article V hereof shall survive the term of this Agreement and
the termination of Executive's employment by the Company.
IV
TERMINATION
.1 Definitions. For purposes of this Article IV, the following
definitions shall be applicable to the terms set forth below:
(a) Cause. "Cause" shall mean only the following: (i) continued
failure by the Executive after receipt of written notice thereof to
perform his duties hereunder or those duties which may, from time to
time, be reasonably requested by the Chief Executive Officer of the
Company (other than such failure resulting from the Executive's
incapacity due to injury or physical or mental incapacity), as
determined by the Board of Directors in their reasonable discretion;
(ii) misconduct by the Executive which is materially injurious to the
Company; (iii) conviction of or pleading no contest to a felony or
crime of moral turpitude; (iv) habitual drunkenness or drug use by the
Executive; (v) failure to uphold the policies of the Company and/or
action by the Executive beyond the scope of his authority, as such
scope is set by the Chief Executive Officer of the Company from time
to time; (vi) a material breach of this Agreement by the Executive.
(b) Disability. "Disability" shall mean an injury or a physical
or mental incapacity as a result of which the Executive becomes unable
to continue the proper performance of his duties hereunder (reasonable
absences because of injury or sickness for up to three (3) consecutive
months excepted). A determination of Disability shall be subject to
the certification of a qualified medical doctor agreed to by the
Company and the Executive or, in the event of the Executive's
incapacity to designate a doctor, the Executive's legal
representative. In the absence of agreement between the Company and
the Executive, each party shall nominate a qualified medical doctor
and the two doctors so nominated shall select a third doctor, who
shall make the determination as to Disability.
(c) Good Reason. "Good Reason" shall mean (i) a material breach
of this agreement by the Company or (ii) the material reduction in
Executive's responsibilities or duties.
.2 Termination by Company.
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(a) The Executive's employment hereunder may be terminated by
the Company immediately for Cause.
(b) Subject to the provisions contained in Article IV(.3)(b) of
this Agreement, the Company may, at its sole discretion, terminate
this Agreement at any time for any reason other than Cause upon thirty
(30) days' written notice to Executive. The effective date of
termination ("Effective Date") shall be considered to be thirty (30)
days subsequent to written notice of termination; however, the Company
may elect to have Executive leave the Company and its subsidiaries
immediately upon issuance of the aforementioned written notice.
.3 Severance Benefits Received Upon Termination by Company.
(a) If at any time the Executive's employment is terminated by
the Company for Cause, the Company shall pay the Executive his Base
Salary prorated through the end of the month during which such
termination occurs plus payment for any vacation earned but not taken,
and the Company shall thereafter have no further obligations under
this Agreement to the Executive or his family, beneficiaries or
estate; provided, however, that the Company will continue to honor any
obligations that may have been accrued and vested under then existing
Company Benefit Plans or any other written and duly authorized
agreements or arrangements applicable to the Executive.
(b) If at any time the Executive's employment is terminated by
the Company without Cause or as a result of Disability, then the
Company shall provide severance payments on the following terms: after
the Executive executes the Company's standard form of Separation
Agreement, the Executive will be paid severance in an amount equal to
six (6) months' Base Salary prorated upon the Executive's current
annualized Base Salary in effect on the date of termination to be paid
over a six month period co-incident with the Company's regularly
scheduled bi-weekly payroll, plus payment for any vacation earned but
not taken. This payment shall be in lieu of any amounts otherwise due
to the Executive under the Company's policy for severance benefits,
unless the Company's policy for severance benefits would provide
greater benefits to the Executive in which case Executive shall be
entitled to the payment called for in this Article IV.3(b) and any
additional or greater benefit he would be entitled to under the
Company's policy for severance benefits. In addition, the Company will
continue to honor any obligations that may have been accrued and
vested under then existing Company Benefit Plans or any other written
and duly authorized agreements or arrangements applicable to the
Executive. The company will also provide the Executive with such
insurance coverage as is then required by COBRA or any similar then
applicable law.
(c) If Executive's employment is terminated due to death, then
the Company shall pay to Executive's primary beneficiary a Severance
of bi-weekly installments of Base Salary co-incident with the
regularly scheduled Company payroll, in the bi-weekly amount which was
in effect on the date of death, such bi-weekly payments to be made
until the earlier date of: (i) receipt by such beneficiary of life
insurance benefits provided under any Company Benefit Plan; or (ii)
180 days after the date of death. The Company shall also pay the
Executive's primary beneficiary for any accrued and unused vacation
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accumulated by the Executive at the time of his death and provide
Executive's family with such insurance coverage as is then required by
COBRA or any similar then applicable law. In addition, the Company
will continue to honor any obligations that may have been accrued and
vested under then existing Company Benefit Plans or any other written
and duly authorized agreements or arrangements applicable to
Executive.
.4 Termination by Executive for Good Reason.
Executive may at any time terminate his employment hereunder
immediately for Good Reason. If the Executive's employment is
terminated by the Executive for Good Reason, the Executive shall be
entitled to receive the payments and benefits called for in Article IV
.3(b).
.5 Termination by Executive Without Good Reason.
Executive may at any time terminate his employment hereunder for
any reason other than Good Reason upon 30 days written notice to the
Company. On or before the last day of his employment, the Company
shall make the payment provided for in Article IV .3(a) hereof and no
further payments shall be required to be made by the Company to the
Executive.
.6 No Obligation to Mitigate Damages; No Effect on Other
Contractual Rights.
(a) The Executive shall not be required to mitigate damages or
the amount of any payment provided for under this Agreement by seeking
other employment or otherwise, nor shall the amount of any payment
provided for under this Agreement be reduced by any compensation
earned by the Executive as the result of employment by another
employer after the date of termination, or otherwise.
(b) The provisions of this Agreement, and any payment or benefit
provided for hereunder, shall not reduce any amounts otherwise
payable, or in any way diminish the Executive's existing rights, or
rights which would accrue solely as a result of the passage of time,
under any Company Benefit Plan or other contract, plan or arrangement.
.7 Notwithstanding any inference to the contrary, the benefits
payable to the Executive in accordance with this Section IV shall not
include bonus or other incentive compensation awards based upon
performance. Bonus or other incentive compensation are at the sole
discretion of the board of directors and shall only be paid to
Executive if such compensation is paid in accordance with the
Company's award payment policies applicable to employees of the
Company in similar employment positions on or prior to the date of
termination of Executive's employment.
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V
GENERAL PROVISIONS
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.1 Notice. For purposes of this Agreement, notices and all other
communications provided for in the Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by Federal Express or
similar priority mail service, or United States registered mail, return receipt
requested, postage prepaid, as follows:
If to the Company: With a copy to Company Counsel:
Aerospace Products International FAvS Xxxxxxxxx Xxxxx, Esq.
Xxxxxxx Xxxxxx Xxxx Xxxxxxx & Xxxxxx
0000 Xxxxxxxxxx Xxxxx Xxxxx 00 Xxxxxxxxx Xxx. 000 Xxxxx Xxxxxx
Xxxxxxx, XX 00000 Xxxxxxxx, XX Xxx Xxxx, XX 00000
Telephone: (000) 000-0000 (000) 000-0000 Telephone: (000) 000-0000
Fax: (000) 000-0000 (000) 000-0000 fax Fax: (000) 000-0000
If to the Executive:
Xxxx Xxxxxxxx
0000 Xxxxxxxxx Xxxx
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Xxxxxxxxx, XX 00000
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or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
.2 No Waivers. No provision of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing signed by the Executive and the Company. No waiver by either party
hereto at any time of any breach by the other party hereto of, or compliance
with, any condition or provision of this Agreement to be performed by such other
party shall be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time.
.3 Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Tennessee without regard to
conflicts of law principles. Executive hereby agrees to submit to the exclusive
jurisdiction of the courts in and of the State of Tennessee, and consents that
service of process with respect to all courts in and of the State of Tennessee
may be made by registered mail to Executive at his address for notices specified
herein.
.4 Severability or Partial Invalidity. The invalidity or
unenforceability of any provisions of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement, which shall
remain in full force and effect.
.5 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 will constitute one and the same instrument.
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.6 Legal Fees and Expenses. Should any party institute any action
or proceeding to enforce this Agreement or any provision hereof, or for damages
by reason of any alleged breach of this Agreement or of any provision hereof, or
for a declaration of rights hereunder, the prevailing party in any such action
or proceeding shall be entitled to receive from the other party all costs and
expenses, including reasonable attorneys' fees, incurred by the prevailing party
in connection with each separate cause of action asserted in such action or
proceeding.
.7 Entire Agreement. This Agreement constitutes the entire
agreement of the parties and supersedes all prior written or oral and all
contemporaneous oral agreements, understandings, and negotiations between the
parties with respect to the subject matter hereof. This Agreement is intended by
the parties as the final expression of their agreement with respect to such
terms as are included in this Agreement and may not be contradicted by evidence
of any prior or contemporaneous agreement. The parties further intend that this
Agreement constitutes the complete and exclusive statement of its terms and that
no extrinsic evidence may be introduced in any judicial proceeding involving
this Agreement.
.8 Assignment. This Agreement and the rights, duties, and
obligations hereunder may not be assigned or delegated by any party without the
prior written consent of the other party. Notwithstanding the foregoing
provisions of this Section V.8, the Company may assign or delegate its rights,
duties, and obligations hereunder to any person or entity which succeeds to all
or substantially all of the business of the Company through merger,
consolidation, reorganization, or other business combination or by acquisition
of all or substantially all of the assets of the Company; provided that such
person assumes the Company's obligations under this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
AEROSPACE PRODUCTS INTERNATIONAL INC.
a Delaware corporation
/s/ Xxxxx X. Xxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxx
Title: Chief Executive Officer
/s/ Xxxx Xxxxxxxx
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Name: Xxxx Xxxxxxxx
Title: Vice President and Chief Financial Officer
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