Exhibit 10.25
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement (this "Agreement") is
dated as of February 2, 2004, between Aerospace Products International, Inc., a
Delaware corporation, 0000 Xxxxxxxxxx Xxxxx Xxxxx, Xxxxxxx, XX 00000 (the
"Company"), and Xxxx X. Xxxxxxx, an individual, U.S. citizen, residing at
(the "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;
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
.1 Employment. The Company employs the Executive and the
Executive hereby accepts employment as its Senior Vice President and Chief
Operating Officer 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 February 16, 2004 and
continue, subject to Article IV hereof, for a period of three years, through
January 31, 2007 ("Employment Term").
.3 Executive Duties. As the Chief Operating 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 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.
Page 1 of 9
II
COMPENSATION AND BENEFITS
.1 Base Salary. During the Employment Term, the Company shall pay to
the Executive an annualized base salary of One Hundred Ninety Thousand Dollars
($190,000) per year (the "Base Salary"), payable in substantially equal biweekly
installments of Seven Thousand Three Hundred Seven Dollars and Sixty Nine Cents
($7,307.69). 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.
.2 Signing Bonus. In addition to the Base Salary, Executive shall
receive a one-time Signing Bonus of Fifteen Thousand Dollars ($15,000), to be
paid on the date of his first biweekly salary payment after the commencement of
the Employment Term.
.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.
(a) Employee shall receive an incentive stock option as set
forth in the Incentive Stock Option Award Agreement between
the Executive and First Aviation Services, Inc. entered into
contemporaneously herewith.
(b) In addition to its regular annual performance reviews and
bonus determinations, the Company will conduct a review of
Executive's performance from the commencement of the
Employment Term through August 16, 2004 in accordance with the
Company's normal review criteria and procedures. If during
such period Executive has fully and satisfactorily performed
his duties and obligations under this Agreement, then
Executive will be eligible to receive a one-time Interim Bonus
of up to Ten Thousand Dollars ($10,000).
.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.
Page 2 of 9
.5 Relocation Expenses. Executive shall also be entitled to
reimbursement of his relocation expenses and temporary living expenses for
relocating to the Memphis area, as set forth in the Relocation Expenses
Agreement between the Company and the Executive entered into contemporaneously
herewith.
.6 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. Executive shall be
entitled to such holidays as are established by the Company for all employees.
III
CONFIDENTIALITY NONDISCLOSURE AND NON-COMPETITION
.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,
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 six (6) 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.
Page 3 of 9
.4 Prohibition on Solicitation of Employees, Agents or Independent
Contractors After Termination. During Executive's employment by the Company and
for a period of six (6) 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) the date one hundred eighty
(180) days 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. In the event of any conflict
Page 4 of 9
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 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.
.2 Termination by Company.
(a) The Executive's employment hereunder may be
terminated by the Company immediately for Cause.
Page 5 of 9
(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:
(1) following the execution of the Company's then
current standard form of Separation Agreement, pay to
the Executive 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. Such amount will be paid in substantially
equal bi-weekly installments co-incident with the
regularly scheduled Company payroll during the
six-month period following termination. The Company
shall also pay the Executive for any accrued and unused
vacation, to be paid upon termination. Such payments
shall be in lieu of any amounts otherwise due Executive
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.
(2) provide 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
Page 6 of 9
unused vacation 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.
Executive may for any reason terminate this
Agreement upon 30 days written notice to the Company. On or
before the last date 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 Executive. If Executive terminates his employment for any
reason before February 16, 2005, the amount any Signing Bonus
shall be returned by Executive to the Company, or offset
against any sums due to Executive by the Company.
.5 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.
.6 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 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.
V
GENERAL PROVISIONS
.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:
Page 7 of 9
If to the Company: With a copy to Company Counsel:
Aerospace Products International FAvS Xxxxxxxxx Xxxxx, Esq.
Attention: Xxxxxx Xxxxxxxxxxx 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: Telephone:
Fax: (000) 000-0000 (000) 000-0000 fax Fax: (000) 000-0000
If to the Executive: With a copy to Counsel:
Xxxx X. Xxxxxxx Xxxxxxx X. Stick
_______________________ Xxxxxx Xxxxx Xxxxxxxxxx & Xxxx
_______________________ 00 Xxxx Xxxxxxx - Xxxxx 0000
Telephone:_____________ Xxxxxxx, XX 00000
Fax: __________________ Telephone:
Fax: 000-000-0000
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.
.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.
Page 8 of 9
.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 par8ties 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
By: /s/ Xxxxxx X. Xxxxxxxxxxx
---------------------------
Title: President
XXXX X. XXXXXXX
an individual
/s/ Xxxx X. Xxxxxxx
------------------------------
Page 9 of 9
