EXHIBIT 10.13
EMPLOYMENT AGREEMENT
Employment Agreement ("Agreement") by and between Hilite
Industries Automotive, LP, a Texas Limited Partnership (the
"Company"), and Xxxxxx X. Xxxxx (the "Executive") effective as of
the 30th day of January, 1998 (the "Effective Date").
W I T N E S S E T H:
1. TERMS OF EMPLOYMENT
1.1 Employment. The Company hereby employs the Executive
as President and Chief Operating Officer of the Company for and
during the term hereof, subject to the direction of the Board of
Directors of the Company and the terms and conditions hereof. The
Executive hereby accepts employment under the terms and conditions
set forth in this Agreement.
1.2 Duties of Executive. Upon the Effective Date, the
Executive shall perform in the capacity described in Section 1.1
hereof and as previously performed by the Executive prior to the
date hereof and shall have such duties, as may be reasonably
assigned to him from time to time by the Board of Directors of the
Company consistent with his executive status and with his mutual
consent. The Executive agrees to devote his full business time and
services to the faithful performance of the duties,
responsibilities, and are consistent with his executive status under
Section 1.1 of this Agreement.
1.3 Term. This Agreement shall become effective as of
the Effective Date and shall continue in force and effect for a term
of one year expiring on the first anniversary of the Effective Date,
unless sooner terminated as provided in Section 1.5 hereof or
renewed or extended by written agreement between the Company and the
Executive pursuant to terms and conditions mutually acceptable to
each provided that this Agreement shall be automatically renewed on
a year-to-year basis unless terminated by a party not later than 60
days prior to any anniversary date. Notwithstanding anything to the
contrary, Executive shall have the right to terminate this Agreement
at any time without liability except that the provisions of Section
1.7 hereof shall remain in full force and effect.
1.4 Compensation. The Company shall pay the Executive,
as compensation for services rendered by the Executive under this
Agreement, as follows:
(a) Base Salary. The Company shall pay the Executive a
minimum base salary ("Salary") of One Hundred Sixty Two Thousand
and Two Hundred Dollars ($162,200) per year. The Salary shall be
subject to review and adjustment on an annual basis beginning
July 1, 1998, (if this contract is then in effect) or, at the
Company's discretion, on such earlier date as the Company may
designate; provided, however, that in no event shall the Executive's
Salary be adjusted below the Salary designated herein.
(b) Bonus Compensation. The Company shall also pay the
Executive annual bonus compensation ("Bonus Compensation") based on
the success of business operations and the pre-tax profits of the
Company and upon the performance of the Executive as determined
by the Board of Directors of the Company which Bonus Compensation
shall be paid by the Company within thirty (30) days after
completion of the audited financial results of the Company.
1.5 Termination. The Agreement may be terminated at any
time during the term hereof only by reason of and in accordance with
the following:
(a) Death. If the Executive dies during the term of
this Agreement and while in the employ of the Company, this
Agreement shall automatically terminate as of the date of the
Executive's death; and the Company shall have no further
obligation to the Executive or his estate, except to pay to the
estate of the Executive any accrued, but unpaid Salary, any Bonus
Compensation determined by the Board of Directors of the Company and
any vacation, sick leave, insurance or other benefits, which have
accrued as of the date of death, but were then unpaid or unused.
(b) Disability. If, during the term of this Agreement,
the Executive shall be prevented from performing his duties
hereunder by reason of becoming totally disabled, then the company,
on ninety (90) days' prior notice to the Executive, may terminate
this Agreement. For purposes of this Agreement, the Executive
shall be deemed to have become totally disabled when (i) he receives
"total disability benefits" under the Company's disability plan
(whether funded with insurance or self-funded by the Company), or
(ii) the Board of Directors of the Company, upon the written report
of a qualified physician (after complete examination of the
Executive) designated by the Board of Directors of the Company,
shall have determined that the Executive has become physically
or mentally incapable of performing his duties under this Agreement
on a permanent basis.
(c) Termination by the Company for Cause. Prior to the
expiration of the term of this Agreement, the Company may discharge
the Executive for cause and terminate this Agreement without any
further liability hereunder to the Executive or his estate, except
to pay any accrued, but unpaid, Salary and vacation benefits to him.
For purposes of this Agreement, a "discharge for cause" shall mean
termination of the Executive upon written notification to the
Executive limited, however, to one or more of the following reasons:
(i) Fraud, misappropriation or embezzlement by the
Executive in connection with the Company; or
(ii) Gross mismanagement or gross neglect of duties
which has a detrimental effect on the Company after written notice
to the Executive of the particular details thereof and a period of
thirty (30) days to correct such mismanagement or neglect, if
any; or
(iii) Conviction by a court of competent
jurisdiction in the United States of a felony or a crime involving
moral turpitude; or
(iv) Willful and unauthorized disclosure of infor-
mation confidential to the Company; or
(v) The Executive's breach of any material term or
provision of this Agreement, after written notice to the Executive
of the particular details thereof and a period of not less than
thirty (30) days thereafter within which to cure such breach,if any
(a) Termination by the Company with Notice. The
Company may terminate this Agreement, for a reason other than as
set forth in this Subparagraph (c) of the Section 1.5 at any time
upon sixty (60) days' written notice to the Executive. Unless
terminated for cause as defined in Paragraph (c) of this Section
1.5, the Executive shall be paid his then prevailing Salary
prorated to the date of termination, plus any accrued but unused
vacation benefits, and, in addition, a termination allowance equal
to six (6) months Salary based upon the highest annual rate paid
the Executive prior to such notice. The termination allowance may,
at the option of the company, be paid in periodic installments over
the applicable period immediately following termination in
accordance with the Company's regular payroll periods or such
lesser period as the Company may determine.
1.6 Employment Benefits. In addition to the Salary and
Bonus Compensation payable to the Executive hereunder, the
Executive shall be entitled to the following benefits, subject
to the following limitations:
(a) Sick Leave Benefits and Disability
Insurance. During his absence due to illness or other incapacity,
the Executive shall be paid sick leave benefits at his then pre-
vailing Salary rate, reduced by the amounts, if any, or worker's
compensation, social security entitlements or disability benefits
under the Company's group disability insurance plan, if any. The
Company, at its expense shall provide the Executive with the
maximum amount of disability insurance benefits allowed for one in
the position of the Executive with the Company under and
consistent with its group disability insurance plan, if the Company
has such a plan.
(b) Life Insurance. The Company, at its expense,
shall provide the Executive with the maximum amount of life
insurance benefits allowed for one in the position of the
Executive with the company under and consistent with its group term
life insurance plan.
(c) Hospitalization, Major Medical and Dental
Insurance. The Company, at its expense, shall provide the
Executive and all dependents of the Executive with group
hospitalization, major medical and dental insurance in amounts of
coverage available to senior executives of the Company to be
substantially equivalent to the plans in effect prior to the date
hereof.
(d) Stock and Options. The Executive shall be
eligible to receive and/or earn stock options from the Company
covering its capital stock at such time, if any, as the Company
has adopted appropriate stock option or investment plans for its
executive employees.
(e) Profits and Pension Plan Benefits. The
Company, at its expense, shall provide the Executive during the
term of this Agreement with profit sharing and pension benefits
substantially equivalent to similar rights and benefits provided
by the Company to the Executive immediately prior to the Effective
Date of this Agreement.
(f) Vacations. The Executive shall be entitled to
a paid vacation each year during the term of this Agreement
equivalent to four (4) weeks of time, which vacation shall be taken
by the Executive in accordance with the business requirements
of the company at the time and its personnel policies then in
effect relative to this subject.
(g) Working Facilities and Expenses. The
Executive is authorized to incur ordinary, necessary and
reasonable expenses for the promotion of the business and
activities of the Company during the term hereof, including, but
not limited to, expenses for necessary travel and other items
of expense required in the normal and routine course of employment
and in the performance of the duties and responsibilities of the
Executive during the term of this Agreement. The Company shall
reimburse the Executive for all such expenses upon presentation by
the Executive of an itemized account of such expenditures with
the supporting vouchers, invoices and related information attached
thereto.
(h) Automobiles and Related Expenses. The Executive
shall be entitled to receive the sum of Six Hundred Dollars ($600)
per month as an automobile allowance provided at the expense of the
Company from the Effective Date of this Agreement and during the
term hereof, which allowance shall include and cover all expenses
related to insurance, repairs, maintenance, fuel and oil for such
automobile. In addition, the Company shall reimburse the Executive
at the rate dictated by IRS regulations for all actual documented
mileage incurred by the Executive while in the course of conducting
business on behalf of the Company. Notwithstanding the foregoing,
the Company may, at its option, elect to provide the Executive
an automobile of the make, model and year mutually agreeable
by the Company and the Executive and all costs associated with
insurance, fuel, oil, repairs maintenance and other expenses in
lieu of the above described automobile allowances, as may be
mutually agreed between the Executive and the Company. Executive
acknowledges that some or all of the foregoing will be deemed
compensation to him.
1.7 Protective Covenants. Because (i) Executive will
become fully familiar with all aspects of the Company's business
during the period of his employment with the Company, (ii) certain
information of which the Executive will gain knowledge during his
employment is proprietary and confidential information which if of
special and peculiar value to the Company, (iii) if any such
proprietary and confidential information were imparted to or became
known by any persons, including Executive, engaging in a business
in competition with that of the company, hardship, loss and
irreparable injury and damage could result to the Company, the
measurement of which would be difficult if not impossible to
ascertain, and (iv) it is necessary for the Company to protect
its business from such damage, the following covenants
constitute a reasonable and appropriate means, consistent with
the best interests of both the Executive and the Company, to
protect the company against such damage and shall apply to and
be binding upon the Executive as provided herein:
(a) Non-Competition by Executive. Executive
covenants that, while he is an employee of the Company or in any
other individual or representative capacity and for a period of one
year after the expiration or termination of the Agreement, he will
not engage in or participate in any business whose product
lines are in direct competition to the product lines of the Company.
(b) Trade Secrets, Proprietary and Confidential
Information. Executive recognizes that his position with the
Company is one of the highest trust and confidence by reason of
Executive's access to any contact with trade secrets and
confidential and proprietary information of the company. Executive
shall use his best efforts and exercise utmost diligence to protect
and safeguard the trade secrets and confidential and proprietary
information of the Company. Executive covenants that, while he is
an employee of the Company and for one year thereafter, he will not
disclose, disseminate or distribute to another, nor induce any
other person to disclose, disseminate, or distribute, any trade
secret or proprietary or confidential information of the Company,
directly or indirectly, either for Executive's own benefit or for
the benefit of another, whether or not acquired, learned, obtained
or developed by Executive use or cause to be used any trade secret,
proprietary or confidential information in any way except a as is
required in the course of his employment with the Company. All
confidential information relating to the business of the Company
whether prepared by Executive or otherwise coming into his
possession, shall remain the exclusive property of the Company and
shall not be removed from the premises of the Company under any
circumstances whatsoever without the prior written consent of the
Company.
(c) Remedies. In the event of breach or threatened
breach by Executive of any provision of this Section 1.7, the
Company shall be entitled to relief by temporary restraining
order, temporary injunction, or permanent injunction or which it
may be entitled, including any and all monetary damages which the
Company may incur as a result of said breach, violation or
threatened breach or violation. The Company may pursue any remedy
available to it concurrently or consecutively in any order as to
any breach, violation, and the pursuit of one of such remedies at
any time will not be deemed an election of remedies or waiver of
the right to pursue any other of such remedies as to such
breach, violation, or threatened breach or violation, or as to any
other breach, violation, or threatened breach or violation.
Merger or Acquisition. In the event the Company
should consolidate or merge into another corporation, or transfer
all or substantial all of its assets to another entity, or
divide its assets among a number of entitles, this Agreement shall
continue in full force and effect.
2. GENERAL PROVISIONS
2.1 Notices. All notices, requested, consents, and other
communications under this Agreement shall be in writing and shall be
deemed to have been delivered on the date personally delivered or on
the date deposited in a receptacle maintained by the United States
Postal Service for such purpose, postage pre-paid, by certified
mail, return receipt requested, addressed to the respective parties
as follows:
If to the Executive:
Xxxxxx X. Xxxxx
0000 Xxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
If to the Company:
Hilite Industries Automotive, LP
0000 X. Xxxxxxxx
Xxxxxxxxxx, Xxxxx 00000
Either party hereto may designate a different address by providing
written notice of such new address to the other party hereto.
2.2 Severability. If any provision contained in this
Agreement is determined to be void, illegal or unenforceable, in
whole or in part, then the other provisions contained herein shall
remain in full force and effect as if the provision which was
determined to be void, illegal, or unenforceable had not been
contained herein.
2.3 Waiver, Modification and Integration. The waiver by
any party hereto of a breach of any provision of this Agreement
shall not operate or be construed as a waiver of any subsequent
breach of any party. This instrument contains the entire agreement
of the parties concerning employment and supersedes any and all
other agreements, either oral or in writing, between the parties
hereto with respect to the employment of the Executive by the
Company and contains all of the covenants and agreements between the
parties with respect to such employment in any manner whatsoever.
This Agreement may not be modified, altered or amended except by
written agreement of all the parties hereto.
2.4 Binding Effect. This Agreement shall be binding and
effective upon the Company and its successors and permitted assigns,
and upon the Executive, his heirs and representatives; provided,
however, that the Company shall not assign this Agreement without
the written consent of the Executive.
2.5 Governing Law. This Agreement shall be governed by
the laws of the State of Texas.
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the day and year first above written.
HILITE INDUSTRIES AUTOMOTIVE, LP
By: /s/XXXXXX X. XXXXX
/s/XXXXXX X. XXXXX
________________________________
Xxxxxx X. Xxxxx
