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EXHIBIT 10.1
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT (this "Agreement") is effective as of October 1,
1995, by and between XXXXXXXX-XXXXXX INDUSTRIES, INC., a Delaware corporation
(the "Company"), and XXXXXXX X. XXXXXXXXXXX (the "Employee").
The Company recognizes the important contributions that the Employee has made
to the Company as an officer and key employee, as currently evidenced by an
Employment Agreement, dated as of July 10, 1989 and amended as of September 1,
1993 and September 7, 1994 (the "1989 Agreement").
The Company wishes to take steps to assure that the Company will continue to
have the Employee's services available to the Company, and the Company and the
Employee desire to amend and restate the 1989 Agreement.
In consideration for the foregoing, the mutual provisions contained herein, and
for other good and valuable consideration, the parties agree to amend and
restate in its entirety the 1989 Agreement, and agree with each other as
follows:
1. EMPLOYMENT. The Company shall employ the Employee as Chairman of the
Board, and the Employee hereby accepts such continued employment with
the Company, upon the terms and conditions hereinafter set forth.
The Employee shall devote such time and effort to his employment
hereunder as may be reasonably required for the effective performance
of his duties for the Company, and shall not be engaged in any other
activities if such activities would interfere with such performance.
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2. TERM.
A. Employment under this Agreement is at the will of the
Company, and the employment relationship may be terminated
by Employee or by the Company's Board of Directors at any
time, with or without cause.
B. Notwithstanding anything in this Agreement to the contrary,
the provisions of Sections 5, 6 and 7 shall continue in
full force and effect after any termination of this
Agreement.
3. COMPENSATION.
A. The Company agrees to pay the Employee, during the term
hereof at intervals consistent with the Company's normal
payroll schedule, a "Base Salary" in the following amounts:
Period Base Salary
------ -----------
October 1, 1995 - September 30, 1996 $750,000
October 1, 1996 - September 30, 1997 375,000
October 1, 1997 - Termination of Agreement 250,000
B. After the payment of any award for fiscal 1995, the
Employee shall not be entitled to participate in any
incentive or supplemental compensation plan or arrangement
instituted by the Company.
C. The Employee shall be entitled to participate in the
Company's stock option program. The number and timing of
any stock option grants shall be determined in the sole
discretion of the Compensation Committee of the Board of
Directors. Solely for the purposes of any stock options
outstanding at the time of the Employee's termination of
employment, the Employee's status as an "affiliate" of the
Company shall continue to the
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earlier of (i) one year after the date of the Employee's
death or (ii) the last date of expiration, cancellation or
exercise, as the case may be, of any and all of such
outstanding stock options. As partial consideration for
such right, the Employee shall continue during such time
to be available to consult with the Company and its
employees at such times and at such places as may be
reasonably convenient and acceptable to the former
Employee and in such manner as may be consistent with the
former Employee's educational background, experience and
prior positions with the Company and with his regular
duties and responsibilities in the course of his then new
occupation or other employment, if any.
4. SUPPLEMENTAL RETIREMENT BENEFIT.
In addition to any benefits that the Employee may be entitled to
under the Company's retirement plans (qualified and nonqualified),
the Employee shall receive a monthly supplemental retirement benefit
payment beginning on the earlier of (i) October 1, 1997, (ii)
termination of employment or (iii) the Employee's death. The monthly
supplemental retirement benefit payment shall be computed by
converting (i) the net present value of the total amount that the
Employee would have received assuming the notice of election of
part-time status is given on or after January 1, 1997 and on or
before 90 days prior to October 1, 1997 pursuant to Section 4.C(iii)
of the 1989 Agreement, as amended, plus (ii) the retirement pay that
would have been paid pursuant to Section 4.I of the 1989 Agreement,
as amended, into an annuity. The annuity shall be calculated in
accordance with the Company's retirement plan actuarial factors, and
the Employee shall elect the type of annuity (joint or single life).
If no election is made, the annuity will be computed as if a 100%
joint annuity had been elected by the Employee.
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5. RESTRICTIVE COVENANTS.
A. Covenant Not to Compete. At all times during the term of
his employment hereunder and for a period of two years
after the termination of such employment, however such
termination may be brought about, the Employee will not in
any capacity, including, without limitation, as owner,
principal, agent, partner, employee, consultant,
distributor, dealer, contractor, investor, lender, broker
or trustee or through any corporation, partnership,
association or other entity, engage, directly or
indirectly, in any business or commercial activity engaged
in by the Company or any Affiliate; provided that:
(i) during the term of the Employee's employment,
whether he is on active or inactive status, the
foregoing restriction shall not be limited in
geographical scope;
(ii) after the termination of the Employee's
employment, the foregoing restriction shall
apply only within 100 miles of
(a) the principal place of business of
the Company,
(b) the principal place of business of any
Affiliate of which the Employee is an
officer or director at the termination
of active status under this Agreement,
and
(c) any other geographic location in which
the Employee has specifically
represented the interests of the
Company or any Affiliate during the
twelve months prior to the termination
of active status under this Agreement;
and
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(iii) the Employee may be the owner of up to 1% of the
outstanding capital stock of any publicly traded
corporation.
B. No Solicitation. The Employee agrees that during the term
of his employment hereunder and for a period of two years
after the termination of his employment hereunder, he will
not directly or indirectly (i) induce, canvass, solicit,
request or advise any customers of the Company or any
Affiliate to patronize any other entity or to withdraw,
curtail or cancel any business with the Company or any
Affiliate; (ii) disclose to any other person, firm or
corporation the names or addresses of any of the customers
of the Company or any Affiliate; (iii) pursue or prescript
for his own use or benefit or for the use or benefit of any
third party any business opportunity of the Company or any
Affiliate of which he becomes or became aware during the
term of his employment; or (iv) induce, canvass, solicit,
request or advise any employees of the Company or any
Affiliate to accept employment with any person, firm or
business which competes with any business of the Company or
any Affiliate; provided, however, that after termination of
the Employee's employment, the restrictions in clause (i)
of this Section 5B shall be limited to customers located
within one or more of the 100 mile areas described in
Section 5A. The Employee further agrees that he shall not
engage in any pattern of conduct that involves the making
or publishing of written or oral statements or remarks
(including, without limitation, the repetition or
distribution of derogatory rumors, allegations, negative
reports or comments) which are disparaging, deleterious or
damaging to the integrity, reputation or goodwill of the
Company, any Affiliate or their management.
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C. Injunction. If the provisions of this Section 5 are
violated, in whole or in part, the Company shall be
entitled, upon application to any court of proper
jurisdiction, to a temporary restraining order or
preliminary injunction to restrain and enjoin the Employee
from such violation without prejudice to any other remedies
the Company may have at law or in equity.
D. Reformation. In the event that the provisions of this
Section 5 should ever be deemed to exceed the time,
geographic or occupational limitations permitted by
applicable law, the Employee and the Company agree that
such provisions shall be and are hereby reformed to the
maximum time, geographic or occupational limitations
permitted by applicable law.
6. CONFIDENTIAL INFORMATION - INTELLECTUAL PROPERTY.
A. Confidentiality. The Employee recognizes and acknowledges
that he will have access to various confidential or
proprietary information concerning the Company and its
Affiliates of a special and unique value which may include,
without limitation, (i) books and records relating to
operation, finance, accounting, sales, personnel and
management, (ii) policies and matters relating particularly
to operations such as customer service requirements, costs
of providing service and equipment, operating costs and
pricing matters, and (iii) various trade or business
secrets, including business opportunities, marketing or
business diversification plans, business development and
bidding techniques, methods and processes, financial data
and the like (collectively, the "Protected Information").
B. No Disclosure. The Employee agrees, therefore, that he
will not at any time, either while employed by the
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Company or afterwards, knowingly make any independent use
of, or knowingly disclose to any other person or
organization (except as authorized by the Company or
required by law), any of the Protected Information.
C. Injunction. In the event of a breach or threatened breach
by the Employee of the provisions of this Section 6, the
Employee agrees that the Company shall be entitled to a
temporary restraining order or a preliminary injunction
(without the necessity of the Company posting any bond in
connection therewith) restraining the Employee from using
or disclosing, in whole or in part, such Protected
Information. Nothing herein shall be construed as
prohibiting the Company from pursuing any other remedies
available to it for such breach or threatened breach,
including the recovery of damages from the Employee.
D. Intellectual Property. The Employee shall disclose
promptly to the Company any and all conceptions and ideas
for inventions, improvements and valuable discoveries,
whether patentable or not, which are conceived or made by
the Employee solely or jointly with another during the
period of employment on active or inactive status or within
one year thereafter and which pertain primarily to the
material business activities of the Company, and the
Employee hereby assigns and agrees to assign all his
interests therein to the Company or to its nominee;
whenever requested to do so by the Company, the Employee
shall execute any and all applications, assignments or
other instruments which the Company shall deem necessary to
apply for and obtain Letters of Patent of the United States
or any foreign country or to otherwise protect the
Company's interest therein. These obligations shall
continue beyond the termination of employment with respect
to inventions, improvements and valuable discoveries,
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whether patentable or not, conceived, made or acquired by
the Employee during the period of employment on active or
inactive status or within one year thereafter, and shall
be binding upon the Employee's assigns, executors,
administrators and other legal representatives.
7. EMPLOYEE CONDUCT.
A. Certain Payments. The Employee represents and agrees with
the Company that he will make no disbursement or other
payment of any kind or character out of the compensation
paid or expenses reimbursed to him pursuant hereto or with
any other fund which contravenes, in any material respect,
any policy of the Company or, in any material respect, any
applicable statute or rule, regulation or order of any
jurisdiction, foreign or domestic. The Employee further
agrees to indemnify and save harmless the Company from any
liabilities, obligations, claims, penalties, fines,
expenses or losses resulting from any unauthorized or
unlawful acts of the Employee which contravene in any
material respect any policy of the Company or any statute,
rule, regulation or order of any jurisdiction, foreign or
domestic, applicable to the Employee or the Company.
B. Company Policy. The Employee acknowledges that he has been
furnished with a current copy of the policy and procedures
manual of the Company, that he has read and understands
such policies and procedures set forth in such manual (and
will read and become familiar with any revisions or
supplements to this manual), that he understands such
policies and procedures are applicable to the Employee in
the performance of his duties and job performance for the
Company and that he agrees to observe in all material
respects the Company's policies
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and procedures in the conduct by the Employee of his
employment duties for the Company.
C. Cooperation. The Employee agrees to disclose honestly and
fully all information and documentation in his possession
concerning all transactions or events relating to or
affecting the Company or any Affiliate as and to the extent
such information or documentation is requested by the
Company or the authorized representatives thereof.
8. GENERAL PROVISIONS.
A. Partial Invalidity. In case any one or more of the
provisions of this Agreement shall, for any reason, be held
by a court of competent jurisdiction to be invalid, illegal
or unenforceable in any respect, (i) such invalidity,
illegality or unenforceability shall not affect any other
provisions of this Agreement, and (ii) this Agreement shall
be construed as if such invalid, illegal or unenforceable
provision had never been contained herein.
B. Entire Agreement. The Employee acknowledges this Agreement
is the entire agreement governing the Employee's
relationship with the Company.
C. Amendment. No provision of this Agreement may be amended,
modified or waived unless such amendment, modification or
waiver shall be agreed to in writing and signed by the
Employee and by a person duly authorized by the
Compensation Committee.
D. Assignment. No right to or interest in any compensation or
reimbursement payable hereunder shall be assignable or
divisible by the Employee.
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E. Headings. The headings of sections and subsections hereof
are included solely for convenience of reference and shall
not control the meaning or interpretation of any of the
provisions of this Agreement.
F. Choice of Law. This Agreement shall be construed in
accordance with and governed for all purposes by the laws
of the State of Texas.
G. Merger, etc. This Agreement may not be assigned,
partitioned, subdivided, pledged, or hypothecated in whole
or in part without the express prior written consent of the
Employee and the Company. This Agreement shall not be
terminated either by the voluntary or involuntary
dissolution or the winding up of the affairs of the
Company, or by any merger or consolidation wherein the
Company is not the surviving corporation, or by any
transfer of all or substantially all of the Company's
assets on a consolidated basis. In the event of any such
merger, consolidation or transfer of assets, the provisions
of this Agreement shall be binding upon and shall inure to
the benefit of the surviving corporation or to the
corporation to which such assets shall be transferred.
9. NOTICES.
Any notice required or permitted to be given under this Agreement
shall be in writing and shall be deemed to have been given when
delivered in person or when deposited in the U.S. mail, postage
prepaid, and mailed to the addressee's address set forth herein, and
any notice given to the Company shall be addressed to the Secretary
of the Company.
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IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as
of the day and year first set forth above.
/s/ Xxxxxxx X. Xxxxxxxxxxx
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(Employee's Signature)
XXXXXXXX-XXXXXX INDUSTRIES, INC.
By: /s/ Xxxxxx Xxxxxxxxx
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Xxxxxx Xxxxxxxxx
Chairman, Compensation Committee
X.X. Xxx 0000
Xxxxxxx, Xxxxx 00000
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