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EXHIBIT 10.1
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as
of the 16th day of February, 1998 by and between GENERAL ROOFING SERVICES, INC.
(hereinafter called "GRS") and XXXXX X. XXXXXXX (hereinafter called the
"Executive").
RECITALS
A. GRS has entered into stock purchase agreements (the "Purchase
Agreements") to acquire all of the capital stock of 18 commercial roofing
companies.
B. In light of the Executive's significant role in GRS, GRS desires to
assure itself of the Executive's services as the President and Chief Executive
Officer of GRS, and the Executive is willing to make his services available to
GRS, upon the terms and subject to the conditions hereinafter set forth.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing Recitals and the
covenants and conditions set forth herein, the parties hereby agree as follows:
1. EMPLOYMENT.
1.1 EMPLOYMENT AND TERM. GRS shall employ the Executive and the
Executive shall serve GRS, upon the terms and subject to the conditions of this
Agreement, for the period commencing on the date hereof (the "Effective Date")
and ending three years from the Effective Date (the "Term"), subject to the
provisions of Section 4 hereof; PROVIDED, that commencing on the first
anniversary of the Effective Date, GRS or the Executive may terminate this
Agreement upon 180 days prior written notice to the other party hereto.
1.2 DUTIES OF EXECUTIVE. The Executive shall serve as the
President and Chief Executive Officer of the GRS, shall have the principal
responsibilities listed on EXHIBIT A hereto, and shall perform the duties of an
executive commensurate with such position. The Executive shall diligently
perform all services as may be reasonably assigned to him by the Board of
Directors of GRS consistent with such position and shall exercise such power and
authority as may from time to time be delegated to him by the Board of Directors
of GRS. The Executive shall devote his full working time and attention to the
business and affairs of GRS and shall not, during the Term, be engaged in any
other business activity that may interfere with the Executive's ability to
perform the duties assigned to the Executive under this Agreement.
1.3 PLACE OF PERFORMANCE. In connection with his employment by
GRS, the Executive shall be based at GRS' offices in Pompano Beach, Florida
except for required travel for GRS' business.
2. COMPENSATION.
2.1 BASE SALARY. During the Term, the Executive shall receive
an annual base salary of $200,000 (the "Base Salary"), which is based on the
base salary paid to executives of the same class and having similar duties as
the Executive. The Base Salary may be increased based upon the performance of
GRS and the Executive, as determined by the Compensation Committee of the Board
of Directors of GRS (the "Compensation Committee") in its sole authority and
discretion. The Base Salary shall be payable in substantially equal installments
consistent with GRS' normal payroll schedule, subject to applicable withholding
and other taxes.
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2.2 BONUS. The Executive shall be eligible to receive an annual
bonus and participate in the Company's 1998 Stock Option and Restricted Stock
Purchase Plan and receive stock options and awards of common stock of the
Company thereunder, as determined by the Compensation Committee in its sole and
absolute discretion.
3. EXPENSE REIMBURSEMENT AND OTHER BENEFITS.
3.1 EXPENSE REIMBURSEMENT. During the Term, GRS, upon the
submission of supporting documentation by the Executive to GRS, shall reimburse
the Executive for all reasonable expenses actually paid or incurred by the
Executive in the course of and pursuant to the business of GRS, including
reasonable expenses for required travel and entertainment.
3.2 OTHER BENEFITS. GRS shall obtain for the Executive such
medical insurance coverages as are generally being provided to other employees
of GRS from time to time. The Executive shall also be eligible for four weeks
paid vacation per year during the term of this Agreement.
4. TERMINATION.
4.1 TERMINATION FOR CAUSE. Notwithstanding anything contained
in this Agreement to the contrary, this Agreement may be terminated by GRS for
Cause. As used in this Agreement, "Cause" shall only mean (i) any action or
omission of the Executive which constitutes a willful and material breach of
this Agreement which is not cured or as to which diligent attempts to cure have
not commenced within 30 business days after receipt by Executive of written
notice of same (which notice shall specify in detail the acts or omissions
relied upon by GRS), (ii) fraud, embezzlement or misappropriation as against GRS
or GRS or (iii) the conviction of Executive for any criminal act which is a
felony. Upon any determination by the Board of Directors of GRS (the "Board")
that Cause exists under clause (i) of the preceding sentence, a special meeting
of the Board will be called and held at a time mutually convenient to the Board
and Executive, but in no event later than 10 business days after Executive's
receipt of the notice contemplated by clause (i). Executive shall have the right
to appear before such special meeting of the Board with legal counsel of his
choosing to refute any determination of Cause specified in such notice, and any
termination of Executive's employment by reason of such Cause determination
shall not be effective until Executive is afforded such opportunity to appear.
Upon any termination pursuant to this Section 4.1, GRS shall pay to the
Executive any unpaid Base Salary accrued through the effective date of
termination specified in such notice. Except as provided above, GRS shall have
no further liability hereunder (other than for reimbursement for reasonable
business expenses incurred prior to the date of termination, subject, however,
to the provisions of Section 3.1).
4.2 DISABILITY. Notwithstanding anything contained in this
Agreement to the contrary, GRS, by written notice to the Executive, shall at all
times have the right to terminate this Agreement, and the Executive's employment
hereunder, if the Executive shall, as the result of mental or physical
incapacity, illness or disability, fail to perform his duties and
responsibilities provided for herein for a period of more than 120 days in any
12-month period. Upon any termination pursuant to this Section 4.2, GRS shall
pay to the Executive any unpaid Base Salary, bonus and other benefits accrued
through the effective date of termination. Except as provided above, GRS shall
have no further liability hereunder (other than for reimbursement for reasonable
business expenses incurred prior to the date of termination, subject, however,
to the provisions of Section 3.1).
4.3 DEATH. In the event of the death of the Executive during
the Term of his employment hereunder, GRS shall pay to the personal
representative of the estate of the deceased Executive any unpaid Base Salary,
bonus and other benefits accrued through the date of his death. Except as
provided above, GRS shall have no further liability hereunder (other than for
reimbursement for reasonable business expenses incurred prior to the date of the
Executive's death, subject, however, to the provisions of Section 3.1).
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5. RESTRICTIVE COVENANTS.
5.1 NONCOMPETITION. In consideration of the agreements of GRS
hereunder, during the period commencing on the Effective Date and continuing for
a period of two years after termination of employment hereunder (the "Restricted
Period"), the Executive shall not, directly or indirectly engage in or have any
interest in, directly or indirectly, any sole proprietorship, partnership,
corporation, business or any other person or entity (whether as an employee,
officer, director, partner, agent, security holder, creditor, consultant or
otherwise) that directly engages in competition with GRS, within 50 miles of the
office of GRS or a subsidiary of GRS, if any, at which the Executive is
primarily based during the Term or at the time Executive's employment with GRS
is terminated (the "Territory"); PROVIDED, HOWEVER, that Executive may acquire,
solely as an investment, shares of capital stock or other equity securities of
any company which are traded on any national securities exchange or are
regularly quoted in the over-the-counter market, so long as Executive does not
control, acquire a controlling interest in or become a member of a group which
exercises direct or indirect control of, more than five percent of any class of
capital stock of such corporation.
5.2 NONDISCLOSURE. During the Term and following termination of
the Executive's employment with GRS, Executive shall not divulge, communicate,
use to the detriment of GRS or any of its subsidiaries, or for the benefit of
any other person or persons, or misuse in any way, any Confidential Information
(as hereinafter defined) pertaining to the business of GRS or any of its
subsidiaries. Any Confidential Information or data now or hereafter acquired by
the Executive with respect to the business of GRS or any of its subsidiaries
(which shall include, but not be limited to, information concerning GRS' or any
of its subsidiaries' financial condition, prospects, customers, suppliers,
partners, methods of doing business and marketing and promotion of their
products or services) shall be deemed a valuable, special and unique asset of
GRS that is received by the Executive in confidence and as a fiduciary, and
Executive shall remain a fiduciary to GRS with respect to all of such
information. For purposes of this Agreement, "Confidential Information" means
information disclosed to the Executive or known by the Executive as a
consequence of or through his employment by GRS or any of its subsidiaries
(including information conceived, originated, discovered or developed by the
Executive) prior to or after the date hereof, and not generally known about GRS,
or any of its subsidiaries, or its respective businesses. Notwithstanding the
foregoing, nothing herein shall be deemed to restrict the Executive from
disclosing Confidential Information to the extent required by law.
5.3 NONSOLICITATION OF EMPLOYEES. During the Restricted Period,
Executive shall not directly or indirectly, for himself or for any other person,
firm, corporation, partnership, association or other entity, attempt to employ
or enter into any contractual arrangement with any employee or former employee
of GRS or any of its subsidiaries, unless such employee or former employee has
not been employed by GRS or such subsidiaries for a period in excess of six
months.
5.4 BOOKS AND RECORDS. All books, records, accounts and similar
repositories of Confidential Information of GRS, or any of its subsidiaries,
whether prepared by the Executive or otherwise coming into the Executive's
possession, shall be the exclusive property of GRS and shall be returned
immediately to GRS on termination of this Agreement or on the Board's request at
any time.
5.5 MATERIAL INDUCEMENT. The covenants made by the Executive
under this Section 5 are a material inducement for GRS to consummate the
Purchase Agreements, and the parties expressly acknowledge and agree that GRS
would not agree to make the Purchase Agreements if the covenants of the
Executive under this Section 5 were not being made. Notwithstanding anything to
the contrary contained herein, the provisions of this Section 5 shall survive
the expiration or termination of this Agreement or Executive's employment
hereunder.
6. INJUNCTION. It is recognized and hereby acknowledged by the parties
hereto that a breach by the Executive of any of the covenants contained in
Section 5 of this Agreement will cause irreparable
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harm and damage to GRS, the monetary amount of which may be impossible to
ascertain. As a result, the Executive recognizes and hereby acknowledges that
GRS shall be entitled to an injunction from any court of competent jurisdiction
enjoining and restraining any violation of any or all of the covenants contained
in Section 5 of this Agreement by the Executive or any of his affiliates,
associates, partners or agents, either directly or indirectly, and that such
right to injunction shall be cumulative and in addition to whatever other
remedies GRS may possess.
7. GOVERNING LAW; WAIVER OF JURY TRIAL. This Agreement shall be
governed by and construed in accordance with the laws of the State of Florida as
to all matters, including, but not limited to, matters of validity,
construction, effect and performance, except that no doctrine of choice of law
shall be used to apply any law other than that of Florida. IN THE EVENT OF ANY
LITIGATION WITH RESPECT TO ANY MATTER CONNECTED WITH THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREUNDER ALL OF THE PARTIES HERETO WAIVE ALL RIGHTS
TO A TRIAL BY JURY AND AGREE TO SUBMIT TO BINDING ARBITRATION IN FLORIDA IN
ACCORDANCE WITH THE RULES OF THE AMERICAN ARBITRATION ASSOCIATION.
8. 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 by hand or when deposited in the United States mail, by registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:
If to GRS: General Roofing Services, Inc.
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxx Xxxxx, Xxxxxxx 00000
Attn: Xxxxx Xxxxxxx, President
Tel: (000) 000-0000
Fax: (000) 000-0000
With a copy to: Xxxxx & XxXxxxxx
0000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxx, Xxxxxxx 00000
Attn: Xxxxxx Xxxxx, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
If to the Executive: Xxxxx X. Xxxxxxx
General Roofing Services, Inc.
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxx Xxxxx, Xxxxxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
or to such other address as either party hereto may from time to time give
notice of to the other in the aforesaid manner.
9. ASSIGNMENT, BENEFITS, BINDING EFFECT. This Agreement and all of the
provisions hereof shall be binding upon and inure to the benefit of the parties
hereto and their respective heirs, successors and permitted assigns, but neither
this Agreement nor any of the rights, interests or obligations hereunder shall
be assigned by Executive.
10. SEVERABILITY. The invalidity of any one or more of the words,
phrases, sentences, clauses or sections contained in this Agreement shall not
affect the enforceability of the remaining portions of this Agreement or any
part thereof, all of which are inserted conditionally on their being valid in
law, and, in the
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event that any one or more of the words, phrases, sentences, clauses or sections
contained in this Agreement shall be declared invalid, this Agreement shall be
construed as if such invalid word or words, phrase or phrases, sentence or
sentences, clause or clauses, or section or sections had not been inserted. If
such invalidity is caused by duration, geographic scope or both, the otherwise
invalid provision will be considered to be reduced to a period or area which
would cure such invalidity.
11. WAIVERS. The waiver by either party hereto of a breach or violation
of any term or provision of this Agreement shall not operate nor be construed as
a waiver of any subsequent breach or violation.
12. DAMAGES. Nothing contained herein shall be construed to prevent
GRS, GRS or the Executive from seeking and recovering from the other damages
sustained by them as a result of its or his breach of any term or provision of
this Agreement. In the event that either party hereto brings suit for the
collection of any damages resulting from, or the injunction of any action
constituting, a breach of any of the terms or provisions of this Agreement, then
the party found to be at fault shall pay all reasonable court costs and
attorneys' fees of the other.
13. AMENDMENT; ENTIRE AGREEMENT. This Agreement may not be amended or
modified unless such amendment or modification is agreed to in writing and
signed by GRS and the Executive. This Agreement embodies the entire agreement
and understanding of the parties hereto in respect of the subject matter of this
Agreement, and supersedes and replaces all prior agreements, understandings and
commitments with respect to such subject matter.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first above written.
GENERAL ROOFING SERVICES, INC.:
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx
President and Chief Executive Officer
EXECUTIVE:
/s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx
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EXHIBIT A
EXECUTIVE'S RESPONSIBILITIES
TITLE: CHIEF EXECUTIVE OFFICER
REPORT TO: BOARD OF DIRECTORS
SUPERVISES: CFO, COO, VP of Corporate Development and VP of Human Resource
Administration
OBJECTIVE/MISSION: Officer responsible for the overall direction of the
organization. Formulate plans and policies to achieve overall corporate
objectives.
DUTIES & RESPONSIBILITIES:
1. Oversee all operational and administrative functions of the organization.
Insure proper integration and support of all corporate positions to regional
offices.
2. Oversee and approve all expansion activities.
3. Formulate and recommend to the Board, all salary, bonus, stock option and
benefit plans.
KEY RESULTS: Insure the company performs as expected and enhance stockholders
equity.
