EMPLOYMENT CONTRACT
THE STATE OF TEXAS )(
)( KNOW ALL MEN BY THESE PRESENTS:
COUNTY OF MIDLAND )(
This Employment Contract (Agreement) is made and entered into on or
as of the 23rd day of May, 2000.
By this Agreement, CAP ROCK ELECTRIC COOPERATIVE, INC., referred to
in this agreement as "Cooperative", acting by and through its President and
Chief Executive Officer, Xxxxx X. Xxxxxx, hereinafter referred to as "Xxxxxx"
employs Xxxxxx Xxxx, referred to in this Agreement as "Xxxx", and who accepts
employment on the following terms and conditions:
ARTICLE 1
TERMS OF EMPLOYMENT
By this Agreement, the Cooperative, acting by and through and under
the direction of Xxxxxx, employees Xxxx and Xxxx accepts employment with the
Cooperative for an initial term of two (2) years. Unless a written notice to
terminate this Agreement is executed and properly delivered by either party
prior to an anniversary date and subject to a satisfactory evaluation by
Xxxxxx of Xxxx on the annual employee appraisal, this Agreement shall
annually and automatically be renewed for an additional term of two (2)
years. This Agreement may, however, be terminated earlier, as provided in
Article 4, below.
ARTICLE 2
EMPLOYMENT COMPENSATION & BENEFITS
2.01 As compensation for all services rendered under this Agreement, Xxxx
shall be paid by Cooperative an annual salary of $110,000.00 per year,
together with an annual salary adjustment in an amount at least equal to any
approved across the board salary adjustments for all employees. Additionally,
upon the execution of this Agreement, Xxxx shall receive a $100,000.00
signing bonus to be paid as Xxxx directs at his discretion, immediately, or
deferred over time as Xxxx directs the Cooperative.
2.02 Xxxx shall receive a benefit package which is equivalent to or better
than the benefit package that he currently has with his current employer.
Xxxx shall provide the Cooperative with necessary information about his
current benefit package so that the Cooperative and Xxxx can work together to
arrange such a benefit package.
2.03 The term "benefit package" shall include annual leave, sick leave,
vacation, retirement or 401k plans, holiday pay, etc. Xxxx, in recognition of
his previous years of service in the telecommunications industry, shall
immediately be vested with three (3) weeks of vacation and shall accrue three
(3)
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weeks of vacation per year during his employment with the Cooperative.
Additionally, Xxxx shall be entitled up to five (5) days of "paid executive
education" courses per year.
2.04 During the term of this Agreement, Xxxx shall have the potential to earn
up to five times his base salary in bonuses or other forms of compensation in
any given calendar or fiscal year. Such bonuses shall be awarded in
accordance with a procedure for accomplishing goals and/or results in
accordance with targets established by Xxxxxx and Xxxx each calendar or
physical year.
2.05 Because Xxxx' duties will from time to time require him to work outside
of; and in addition to, the Cooperative's established normal work week, work
days and work hours, Xxxx shall be allowed to take compensatory time off.
2.06 The parties recognize that Xxxx' current domicile is in Lubbock, Texas.
The parties agree that for at least the first seven (7) years that this
Agreement is in effect, Xxxx shall perform his duties pursuant to this
Agreement by working at such location as he chooses, at his discretion, so
long as he is able to perform the duties hereunder at such location.
2.07 The Cooperative shall furnish Xxxx a vehicle during his employment and
shall pay the monthly dues for Xxxx' membership at the Lubbock Country Club.
ARTICLE 3
COVENANT TO PERFORM
3.01 Xxxx agrees and covenants to perform his work and services diligently
and use his best efforts to faithfully comply with all of the assignments
duly made to him on behalf of the Cooperative by Xxxxxx.
3.02 Xxxx agrees to execute and honor and abide by the Cooperative's
"Employee Pledge and Proprietary Rights and Information Agreement" which all
other employees of the Cooperative have executed and agreed to, a copy of
which is attached hereto as Exhibit "A".
ARTICLE 4
TERM AND TERMINATION
4.01 The Cooperative shall employ Xxxx pursuant to this Agreement for the
two (2) year term beginning with the effective date of his employment
hereunder, yearly renewable subject to and following a satisfactory
evaluation employee appraisal report on Xxxx by Xxxxxx, for successive two
year terms. However, if during such employment, Xxxx fails or refUses to
perform the work and services assigned to him on behalf of the Cooperative by
Pruitt, or should he become derelict in so performing, or become unable to
perform, or otherwise become in substantial breach of this Agreement, all as
may be determined by Xxxxxx in his sole discretion, or otherwise so act as to
give the Cooperative cause, this Agreement shall, at Xxxxxx'x sole option,
cease and terminate and any of
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Xxxx' rights hereunder not already finally vested shall cease on or at such
time as Xxxxxx shall notify Xxxx in writing. The term "cause" shall include
the following:
1. Knowingly, willfully and substantially, during the term of
this Agreement, neglects the duties that Xxxx is required to
perform under the terms of this Agreement.
2. Knowingly, willfUlly and substantially, during the term of
this Agreement, commits clearly dishonest acts toward the
Cooperative with the intent to injure or damage the
Cooperative.
3. Insubordination or failing to follow the directives of
the President/CEO.
4.02 If Xxxx' employment terminates for any reason other than as provided for
in paragraph 4.01, the Cooperative shall pay Xxxx a lump sum cash settlement
equal to the total salary then in effect for the two (2) year term of the
Contract, plus the amount the Cooperative would have paid during such period
for Xxxx' benefit package, including any accrued but untaken vacation, sick
leave, compensatory time, bonuses and other compensation authorized by the
Board of Directors.
4.03 Notwithstanding paragraphs 4.01 and 4.02, this Agreement and Xxxx'x
employment hereunder may be terminated at such time and upon such terms and
conditions as the parties may mutually agree.
ARTICLE 5
TRADE SECRETS AND CONFIDENTIAL INFORMATION
5.01 During the term of Xxxx' employment, the Company will provide Xxxx
access to, so he may become familiar with, various trade secrets and other
confidential or proprietary information of the Company, train his in the use
of same, and provide associates a working environment in which he can
contribute toward enhancing same and upgrading his general knowledge. Trade
secrets, proprietary information and confidential information encompass,
without limitation, anything which is owned by the Company and is regularly
used in the operation of the business of the Company to obtain a competitive
advantage over the Company's competitors who do not know, have access to, or
utilize such information or trade secrets. Proprietary information further
includes, but is not limited to, records, files, documents, bulletins,
publications, manuals, financial data and information concerning and the
identity of customers, prospects and suppliers. Trade secrets further
include, but are not limited to, specifications, software programs, both the
source code and the object code, documentation, flow charts, diagrams,
schematics, data, data bases, and business and production methods and
techniques.
5.02 Xxxx acknowledges that such training and the use of the trade secrets
and confidential or proprietary information will enable him to perform his
job and enhance his compensation. Xxxx recognizes and acknowledges that the
trade secrets and other confidential or proprietary information of the
Company are valuable, special and unique and that the protection thereof is
of critical importance to the Company in maintaining its competitive
position. Xxxx, therefore, covenants and agrees that, except as required by
his employment hereunder or with the express
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prior written consent of the Company, he shall not, during the term of his
employment by the Company or at anytime thereafter, either directly or
indirectly, make independent use of, publish or otherwise disclose any of the
aforesaid trade secrets or other confidential or proprietary information of
the Company (whether acquired, learned, obtained or developed by him alone or
in conjunction with others) to any person, firm, corporation, association or
other entity for any reason or purpose whatsoever or allow any other person,
firm, corporation, association or other entity to make use of, publish or
disclose any of the aforesaid trade secrets or other confidential or
proprietary information. Xxxx agrees not to use, steal, or appropriate such
items or versions thereof, whether copies or reconstructed from memory or
otherwise, in any manner. Xxxx further recognizes and acknowledges that in
order to enable Company to perform services for its customers and engage in
Company's business, information may be furnished to the Company that is
confidential information and that the goodwill afforded to Company depends
upon, among other things, Company and its employees keeping such services and
information confidential. Xxxx therefore agrees that he shall keep all such
information of the Company and any of its affiliates and subsidiaries
completely and absolutely confidential. This agreement not to disclose
confidential information shall survive after the term of Xxxx' employment
pursuant to this Agreement. Therefore, Xxxx shall be bound by his agreement
herein not to disclose confidential information of the Company and its
affiliates or subsidiaries both during his employment with the Company and
after his employment with the Company is terminated. A violation by Xxxx of
this Article shall be a material violation of this Agreement and will justify
legal and/or equitable relief. Xxxx recognizes that if he breaches this
agreement and discloses confidential information or trade secrets of the
Company or any of its affiliates or subsidiaries, the Company will suffer
substantial, irreparable and continuing injuries, damages and costs attendant
thereto. Further, recognizing that money damages may not provide adequate
relief, Xxxx agrees that, in the event that he breaches or threatens to
breach this Agreement, the Company shall be entitled to a preliminary or
permanent injunction in order to prevent the continuation of such harm and,
as liquidated damages, Xxxx shall forfeit all payments made pursuant to this
Agreement from the date the Agreement was breached and any payments that are
or may be due pursuant to this Agreement, as well as any rights or benefits,
including health insurance benefits.
5.03 Xxxx and the Company acknowledge and agree that the fact that the
Parties have entered into this Agreement and the terms of this Agreement are
confidential. Neither of the Parties may therefore disclose the terms of this
Agreement to others, except as necessary with regard to the filing of income
taxes and other necessary documents or as required by law, or pursuant to a
subpoena or court order, unless such disclosure has been approved by the
other Party's written permission.
ARTICLE 6
NON-COMPETITION AGREEMENT
Xxxx agrees that upon his termination of employment from the
Company, for a period of Five (5) years, he will not engage or participate,
directly or indirectly, in competition with the Company or any of its
affiliates or subsidiaries without the prior written consent of the Company
which consent shall not be unreasonably withheld. This Agreement shall
prohibit Xxxx from,
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among other things, attempts to serve or assist others in serving the
Company's present or potential customers. Xxxx further agrees that he will
never at any time after executing this Agreement, assist any person or entity
in buying, merging with or acquiring the Company unless the Company consents
in writing.
ARTICLE 7
SUPERSESSION AND EFFECTIVENESS
7.01 This Agreement supersedes any other agreement or understanding, written
or oral, between the parties with respect to the matters covered hereunder,
and it contains the entire understanding of the parties and all of the
covenants and agreements between them with respect to Xxxx' employment.
7.02 This Agreement shall bind and be for the benefit of the parties to the
agreement, as well as their respective successors, heirs and assigns, it
being understood, however that this Agreement may be assigned only with the
written consent of both parties.
7.03 The existence and effectiveness of this Agreement between the parties
hereto does not preclude or otherwise interfere with employment of Xxxx by
subsidiary corporations of Cap Rock Electric Cooperative, Inc., or by any
corporation organized by the Cooperative's Board of Directors for the benefit
of the Cooperative, or the receipt of compensation by Xxxx from any such
corporations.
7.04 This Agreement shall become binding upon the parties from and as of
the date of the execution.
IN WITNESS WHEREOF, the parties have executed this Agreement in
duplicate originals, one being retained by each, on or as of the 23rd day of
May, 2000.
CAP ROCK ELECTRIC COOPERATIVE, INC.
--------------------------------- ----------------------------------------
XXXXXX XXXX XXXXX X. XXXXXX, President/CEO
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THE STATE OF TEXAS )(
)(
COUNTY OF MIDLAND )(
This instrument was acknowledged before me on this the 23rd day of May,
2000, by XXXXX X. XXXXXX, President/Chief Executive Officer of Cap Rock
Electric Cooperative, Inc., a Texas cooperative corporation, on behalf of
said corporation.
---------------------------- /s/ Xxxxxx X. Xxxxxxxxx
XXXXXX X. XXXXXXXXX ----------------------------------------
[SEAL] MY COMMISSION EXPIRES Notary Public, State of Texas
July 11, 2003 Printed Name of Notary: Xxxxxx X. Xxxxxxxxx
----------------------------- -------------------
My Commission Expires: 7-11-2003
--------------------
(SEAL)
THE STATE OF TEXAS )(
)(
COUNTY OF LUBBOCK )(
-------
This instrument was acknowledged before me on this the 22 day of May,
2000, by XXXXXX XXXX.
/s/ Xxxxx Xxxxxxxx
--------------------------------------
Notary Public, State of Texas
Printed Name of Notary:
Xxxxx Xxxxxxxx
--------------------------------------
My Commission Expires: 7-23-2003
----------------
(SEAL) --------------------------------------
XXXXX XXXXXXXX
[SEAL] Notary Public, State of Texas
My Commission Expires 7-23-2003
--------------------------------------
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EXHIBIT "A"
CAP ROCK ELECTRIC COOPERATIVE, INC.
EMPLOYEE PLEDGE AND
PROPRIETARY RIGHTS AND INFORMATION AGREEMENT
This Agreement sets forth the understanding between you and Cap Rock Electric
Cooperative, Inc. ("Cap Rock Electric") concerning your relationship as an
employee of Cap Rock Electric and your treatment of Cap Rock Electric's
confidential and proprietary information. Cap Rock has agreed to employ you
with the understanding and expectation that you agree to and will abide by
the following terms and conditions:
1. EMPLOYEE PLEDGE
a. CONDUCT OF EMPLOYEE. I will conduct myself at all times
while I am on duty in a manner that will reflect well on Cap
Rock Electric Cooperative, Inc. I understand that when
people observe me and my actions, they are looking at me as
a representative of Cap Rock Electric and will judge Cap
Rock Electric through my actions. Therefore, I will conduct
myself in a professional and dignified manner at all times.
b. GIVING THE BEST. I will strive to give the best of my
ability in my duties as an employee of Cap Rock Electric and
c. DEFENDING AND PROMOTING. I will defend and promote the
mission statement goals, and decisions of Cap Rock Electric
whenever appropriate.
II. PROPRIETARY INFORMATION
You understand that your employment with Cap Rock Electric
creates a relationship of a confidential or proprietary nature
that may be disclosed to you by Cap Rock Electric or learned by
you in the course of your duties at Cap Rock Electric and that
relates to; (i) the business of Cap Rock Electric or that of any
of its subsidiaries, affiliates, customers, suppliers or (ii) any
confidential information of third parties disclosed by Cap Rock
Electric. Such confidential and proprietary information includes
information concerning business strategies, financial information
and forecasts, personnel information and member-consumer lists
and is referred to collectively in this Agreement as "Proprietary
Information."
a. CONFIDENTIALITY OF PROPRIETARY INFORMATION. At all times
both during your employment by Cap Rock Electric and after
its termination, you agree to keep all Proprietary
Information in confidence and trust, and you will not use or
disclose Proprietary Information without the written consent
of Cap Rock Electric, except as may be necessary to perform
our duties as an employee of Cap Rock Electric. Upon
termination of your employment with Cap Rock Electric, you
will promptly deliver to Cap Rock Electric all documents and
materials of any kind pertaining to your work with Cap Rock
Electric and you will not take with you any documents,
materials or copies thereof, whether on paper, magnetic or
optical media or any other medium containing Proprietary
information.
b. INFORMATION OF FORMER EMPLOYER. You agree that during your
employment at Cap Rock Electric you will not improperly use
or disclose and confidential or proprietary information of
your former employer.
III. NO CONFLICTING OBLIGATIONS.
a. NO CONFLICTING EMPLOYMENT. You agree that during the term of
our employment at Cap Rock Electric you will not plan or
engage in any other employment, occupation, consulting or
other business activity directly related to the business in
which Cap Rock Electric is now involved or becomes involved
during the term of our employment, nor will you engage in
any other activities that conflict with our employment
obligations to Cap Rock Electric.
b. NO CONFLICTING AGREEMENTS. our represent to Cap Rock
Electric that you have no other agreements or commitments
that would hinder or prevent the full performance of your
duties as a Cap Rock Electric employee or your obligations
under this Agreement and you agree not to enter into such
conflicting agreement during the term of your employment at
Cap Rock Electric.
c. DISCLOSURE OF AGREEMENT. You hereby authorize Cap Rock
Electric to notify others, including customers of Cap Rock
Electric, and any future employers you may have, of the
terms of this Agreement and your responsibilities under this
Agreement.
IV. NO IMPLIED EMPLOYMENT RIGHTS
You understand and agree that this Agreement does not confer upon
you any right to continued employment by Cap Rock Electric that
you would not otherwise have, nor does this Agreement obligate
Cap Rock Electric to employ you for any specific period of time.
V. GENERAL PROVISIONS
a. SEVERABILITY. If one or more of the provisions of this
Agreement are deemed void by law, the remaining provisions
will continue in full force and effect.
b. GOVERNING LAW. This Agreement will be governed by the laws
of the State of Texas.
c. ENTIRE AGREEMENT. This Agreement sets forth the entire
Agreement and understanding between you and Cap Rock
Electric relating to the subject matter of this Agreement. o
modification or amendment of this Agreement, nor any waiver
of any rights under this Agreement will be effective unless
in writing signed by both you and an authorized
representative of Cap Rock Electric. Any subsequent changes
in your duties,salary or compensation will not affect the
validity or scope of this Agreement.
d. SUCCESSORS AND ASSIGNS. This Agreement will be binding upon
your heirs, executors, administrators and other legal
representative and will be for the benefit of Cap Rock
Electric, it successors and assigns.
/s/ Xxxxxx X. Xxxx May 22, 2000
--------------------------- ------------------------
Employee Signature Date Signed
Xxxxxx X. Xxxx
---------------------------
Print Name
--------------------------- -----------------------
CPR Representative Date Signed
