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EXHIBIT 10.26
EMPLOYMENT AGREEMENT
THIS AGREEMENT, dated as of November 18th, 1997, is between U.S. Plastic
Lumber Corp., a Nevada corporation ("USPL"), Waste Concepts, Inc., a
Pennsylvania corporation ("WCI") and all of their affiliates, subsidiaries, and
sister companies (collectively the "Company"), and Xxxxxx X. Xxxxx, located at
0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, XX. (the "Executive").
RECITALS
A. Executive has been employed as the principal executive officer of
WCI, and as such has made a unique contribution to the business of WCI.
B. The Board of Directors of the Company believes that the continued
services of Executive would be of great value to the Company and desires
retaining his services for a number of years.
C. Executive is willing to accept employment by the Company upon the
terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained and of the mutual benefits herein provided, the receipt and
sufficiency of which are hereby acknowledged, the Company and Executive hereby
agree as follows:
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1. TERM OF EMPLOYMENT.
The Company shall employ Executive and Executive hereby accepts
employment by the Company, on the terms and conditions herein contained, for a
period of five (5) years commencing as of the date hereof and ending on the five
(5th) anniversary of the date hereof, subject to termination as hereinafter
provided (the period from the date hereof through the fifth (5th) anniversary of
the date hereof or the date of such termination, as the case may be, being the
"Employment Period").
2. DUTIES.
(a) GENERAL DUTIES. During the Employment Period, Executive shall serve
the Company in a senior executive capacity, retaining his current position, as
President of WCI and such other companies as U.S. Plastic Lumber Corp. may
determine to merge or otherwise consolidate into WCI (collectively "WCI
Companies") for the duration of the Employment Agreement, with such duties
consistent therewith, and shall perform such other services for the Company
consistent with the position of a senior executive officer, as may be reasonably
assigned to him from time to time by the Board of Directors of the Company.
(b) PRIMARY ACTIVITY. During the Employment Period, Executive shall
devote his full business efforts, time and energy to the interests and business
of the Company ; however, Executive shall be excused from performing any
services for the Company hereunder during periods of temporary illness or
incapacity and during reasonable vacations, and Executive may devote a
reasonable amount of time to the handling of his personal affairs, without
thereby in any way affecting the compensation to which he is entitled hereunder.
Although it is acknowledged that the duties of a senior executive officer may
require from time to time attention to business at times other than normal
business hours, it is intended by the parties hereto that Executive shall
perform his duties hereunder during normal business hours. During the Employment
Period, Executive shall, to the best of his skill and ability, use his best
efforts and endeavors to the extension and promotion of the business of the
Company , to the proper servicing of such business and to the protection of the
good will of such business, both as now enjoyed and hereafter acquired.
(c) LOCATION AND TRAVEL. During the Employment Period, Executive's
business office shall be located (and his duties shall generally be performable)
at the current executive offices of WCI unless otherwise agreed to in writing by
the Company and Executive. Executive agrees to travel for business purposes in a
reasonable amount for reasonable lengths of time, commensurate with Executive's
senior executive position.
3. COMPENSATION.
As full compensation to Executive for performance of his services
hereunder, the Company agrees to pay Executive and Executive agrees to accept
the following salary and other benefits during the Employment Period:
(a) SALARY. The Company shall pay Executive a salary at the annual rate
of $125,000 per year or such greater annual rate of compensation as the Board of
Directors of the Company may from time to time determine ("Base Salary"). The
Base Salary due Executive hereunder shall be payable in equal semi-monthly
installments, less any amounts required to be withheld by the Company from time
to time from such salary under any applicable federal, state or local income tax
laws or similar laws then in effect.
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(b) REIMBURSEMENT OF EXPENSES. The Company shall reimburse Executive for
all expenses properly incurred by him in the performance of his duties hereunder
in accordance with policies established from time to time by the Board of
Directors of the Company.
(c) FURTHER BENEFITS. Executive shall be entitled to participate in any
health, accident, retirement or similar employee benefit plans provided by the
Company generally to its employees to the extent commensurate with the
participation therein of executives of the Company; provided, however, that such
employee benefit plans shall be no less favorable to Executive than those
provided by the Company to Executive immediately prior to the entering into this
Agreement. Executive shall be entitled to participate in any present or future
bonus, insurance, pension, retirement, profit sharing or other compensation or
incentive plans adopted by the Company, for the general and overall benefit of
executives of the Company, the extent and manner of participation to be
determined by the Board of Directors of the Company. The benefits provided in
this subsection (c) shall be in addition to the compensation and benefits
provided in the other subsections of this Section 3.
(d) OFFICES. Executive agrees to serve without additional compensation,
if elected or appointed thereto, in one or more offices or as a director of any
of the Company's subsidiaries, provided, however, that Executive shall not be
required to serve as an officer or director of any subsidiary if such service
would expose him to adverse financial consequences.
(e) VACATION. The Executive shall be entitled to three (3) weeks vacation
per year.
(f) NON-COMPETE PAYMENT. Executive will be granted stock options equal to
10,000 non-registered voting common shares of USPL contemporaneous with the
execution of this Agreement as a material inducement to comply with Section 4 of
this Agreement. The exercise price for these stock options shall be at $6.00 per
share and shall be exercisable in accordance with the Stock Option Plan as
approved by the Board of Directors of USPL.
(g) INCENTIVE COMPENSATION. Executive shall be entitled to incentive
compensation, in addition to any other compensation within this Agreement as
follows:
(i) In the event WCI achieves net earnings before income taxes, in
accordance with generally accepted accounting principles, as set forth
below, then Executive shall be entitled to receive 5,000 shares of USPL
stock for each year in which Executive meets the performance criteria
listed below.
Year Performance Criteria Shares Earned
1998 EBIT > $700,000 5,000
1999 EBIT > $770,000 5,000
2000 EBIT > $847,000 5,000
2001 EBIT > $932,000 5,000
2002 EBIT > $1,025,000 5,000
(h) AUTO ALLOWANCE. During the term of this Agreement, the Executive
shall receive an auto allowance in the amount of $650.00 per month.
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4. RESTRICTIONS AGAINST COMPETITION, SOLICITATION, SERVICING, AND DIVULGING
CORPORATE CONFIDENTIAL DATA
(a) COVENANT NOT TO COMPETE. As a material inducement to sign this
Agreement, the Executive agrees that as long as he is an employee of the
Company, he will not Compete, as defined herein, with the Company and, further,
that he will not Compete with the Company during the one (1) year period
beginning on the date of termination of this Agreement. During the Employment
period and the one year period subsequent to termination, the Executive shall
not within the United States directly or indirectly, either for Executive's own
account, or as a partner, shareholder (other than shares regularly traded in a
recognized market), officer, director, employee, agent, consultant or otherwise,
be employed by connected with, participate in, consult or otherwise associate
with any other business, enterprise or venture that is the same as, similar to
or competitive with the Company. During employment and for a period of two years
thereafter, the Executive shall not, directly or indirectly, solicit for
employment or employ any employee of the Company. Notwithstanding anything to
the contrary herein, the Executive shall be allowed to act as a passive investor
in GeoCore and not active in any day to day affairs of GeoCore and this
provision shall not prohibit Executive from performing any function with
Consolidated Technologies, Inc.
(b) COVENANT NOT TO SOLICIT OR SERVICE. The Executive acknowledges and
agrees that the Company's parent has spent significant amounts of time and money
purchasing Company and in the development of a list of its Customers, which list
is not available to the general public or the Company's ordinary employees, and
that this list contains other information about the customers not available to
the general public and that the Executive will be privileged to this list. The
Executive also acknowledges and agrees that many of the Customers on this list
do not have an advertised place of business, the Company's competitors could not
recreate this list without substantial efforts, and the Company's business would
be irreparably and greatly damaged by the use of this information other than for
its benefit. Therefore, as a material inducement to the USPL's agreement to
purchase the stock of WCI and issuing stock to the Executive, the Executive will
not solicit or do business with, or attempt to solicit or do business with,
directly or indirectly any of the Company's Customers except on the Company's
behalf and will not solicit or do business with or attempt to solicit or do
business with, directly or indirectly, any of the Company's Customers during the
two (2) year period beginning on the termination of this Agreement; provided
however, that the Executive shall not be prohibited from soliciting the
Company's Customers for a business in which the Company has not been engaged.
(c) COVENANT NOT TO VIOLATE CORPORATE CONFIDENCES. The Executive will
have access to and will become aware of confidential information and trade
secrets including Customer data, files, business secrets, and business
techniques not generally available to the public, and this confidential
information has been compiled by the Company, at great expense and over a great
amount of time. The parties acknowledge that this confidential information gives
the Company a competitive advantage over other businesses in its field of
endeavor and that the Company's business will be greatly and irreparably damaged
by the release or use of this confidential information outside of its own
business. Therefore, as a material inducement to signing this Agreement, the
Executive will not, while he is a Stockholder of USPL or an employee of the
Company, or during the two (2) year period beginning on the termination of this
Agreement, either disclose or divulge this confidential information to anyone or
use this confidential information in any manner to Compete with the Company. A
partial list of this confidential information may be included as a schedule to
the original of this Agreement maintained by the Company's Secretary, and all
parties agree and acknowledge that this list, as amended from time to time in
writing signed by both parties, is true and accurate, but that it is not
necessarily a complete list of such information, and that the restrictions in
this Section shall apply to all such information and not merely to the
information listed
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on such schedule. Confidential information, as defined herein, shall not include
any information which (i) is or becomes publicly available through no act of
Executive, (ii) is rightfully received by Executive from a third party without
restrictions, (iii) is independently developed by Executive or (iv) is disclosed
by Executive pursuant to an administrative or judicial subpoena or order.
(d) ENFORCEMENT. The Company may enforce the provisions of this section
by suit for damages, injunction, or both.
(i) The Company would be irreparably injured by the breach of
any provision of this Section, and money damages alone would not be
an appropriate measure of the harm to the Company from such
continuing breach. Therefore, equitable relief, including specific
performance of these provisions by injunction, would be an
appropriate remedy for the breach of these provisions.
(ii) Money damages will be appropriate with respect to any
past breach of any provision of this Section. Therefore, in case of
any breach of this Section, the breaching party shall render a full
and complete accounting of the gross receipts, expenses, and net
profits that have resulted from such breach and shall be liable for
money damages equal to twenty-five percent (25%) of the gross amount
derived by such breaching party from all transactions in breach of
this Section, such amount representing the amount of profit the
Company could have derived from its own transaction of such business.
(iii) Should a court of competent jurisdiction determine that
equitable relief is not available to remedy the continuous breach of
any or all of the provision of this Section, an amount of liquidated
damages shall be paid to the Company by the breaching party equal to
twenty-five percent (25%) of the gross amount derived by such
breaching party from all transactions in breach of this Section, such
amount representing the amount of profit the Company could have
derived from its own transaction of such business.
(iv) If this Agreement is terminated for any reason
whatsoever, not renewed or extended, the provisions of Section 4 of
this Agreement shall survive and shall be in full force and effect
for the applicable period commencing from the date of actual
termination of employment of the Executive.
(a) Definitions. For the purposes of this Agreement, the
following definitions are applicable:
(1) "Compete." "To Compete" and "to Compete with the
Company" both mean to engage in the same or any similar
business as the Company, beginning with the time this
Agreement terminates, in any manner whatsoever, including
competing as a proprietor, partner, investor, stockholder
(other than as a stockholder with shares regularly traded
in a recognized market), director, officer, employee,
consultant, independent contractor, or otherwise, within
the United States.
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5. TERMINATION OF AGREEMENT.
(a) EVENTS OF TERMINATION. The Employment Period shall cease and
terminate upon the earliest to occur of the events specified below:
(i) The close of business on the fifth (5th) anniversary
of the date hereof, unless this Agreement is renewed;
(ii) the death of Executive;
(iii) termination of Executive's employment for Cause. For
the purpose of this Agreement, the Company shall have "Cause" to
terminate Executive's employment hereunder upon (A) the failure by
Executive to substantially perform his duties hereunder, other
than any such failure resulting from incapacity due to physical or
mental illness, (B) the engaging by Executive in gross negligence
or willful misconduct injurious to the Company, (C) the violation
by Executive of the provisions of Section 4 hereof, or (D) the
conviction of Executive of a felony of a crime involving moral
turpitude.
(iv) the election by Executive to terminate his employment
hereunder upon 60 days prior written notice, unless (A) the
Company materially breaches this Agreement and fails to cure such
breach within 30 days after receiving written notice from
Executive of such breach, then in such event Executive may
terminate this Agreement immediately, or (B) Executive gives the
Company written notice that the Company has acted in bad faith
under this Agreement by imposing one or more enumerated conditions
of employment hereunder ("Conditions"), and the Company fails to
cure the Conditions within 30 days after receiving such written
notice from Executive.
(v) the election by the Company to terminate Executive's
employment hereunder; or
(vi) the permanent disability of Executive. For the
purpose of this Agreement, the "permanent disability" of Executive
shall mean Executive's inability, because of his injury, illness,
or other incapacity (physical or mental), to perform the services
to the Company contemplated hereby for a continuous period of 150
days or for 180 days out of a continuous period of 300 days. Such
permanent disability shall be deemed to have occurred on the 150th
consecutive day or on the 180th day within the specified period,
whichever is applicable.
(b) COMPENSATION UPON TERMINATION. If the Employment Period shall cease
and terminate hereunder:
(i) pursuant to subsection (a)(i), (a)(ii), (a)(iii), or
(a)(vi) of this Section 5, the Company shall pay to Executive (or
his estate in the case of subsection (a)(ii)) his Base Salary
pursuant to Section 3(a) hereof and the reimbursable expenses
incurred under Section 3(b) hereof through the date of
termination. The Company shall have no additional or further
liability to Executive hereunder; or
(ii) pursuant to subsections (a)(v) of this Section 5 or
if a Court of competent jurisdiction finds that either subsections
a(iv)(A) or a(iv)(B) of this Section 5 applies, the Company shall
(A) pay to Executive his Base Salary pursuant to Section 3(a)
hereof and the reimbursable expenses incurred under Section 3(b)
hereof through the date of termination, (B) pay to Executive an
amount equal to his then current annual Base Salary, such amount
to be payable in 12 equal monthly installments, less any amounts
required to be withheld by the Company under
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any applicable federal, State or local income tax laws or similar laws
then in effect, and (C) continue for a period of one year from the date
of termination (but only if permitted by the applicable plan) all fringe
benefits to which Executive is then entitled pursuant to Section 3(c)
hereof (including payment for any benefits to which Executive would be
entitled to receive under the Consolidated Omnibus Budget Reconciliation
Act of 1985 ("COBRA"), the benefit period with respect to which shall
commence on the date of termination); provided, however, that the
Employment Period shall be deemed to have expired on the date of
termination for the purposes of any vesting period, and provided further,
that in no event shall Executive be entitled to receive pursuant to
clause (b) above an amount in excess of that to which Executive would
have been entitled had this Agreement not been so terminated.
(c) EFFECT OF TERMINATION. This Agreement and all liabilities and
obligations of the parties hereto hereunder shall cease and terminate effective
upon any termination of the Employment Period permitted by this Agreement,
except for any earned but unpaid compensation which shall be payable when due
and COBRA rights; provided, however, that Executive's obligations under Section
4 hereof and the Company's obligations under subsection (b)(ii) of this Section
5 shall survive any such termination.
(d) REMEDIES. Nothing herein contained shall be construed as prohibiting
any party hereto from pursuing any other remedies available to it for any breach
of any provision hereof.
6. ASSIGNMENT.
This Agreement shall not be assigned by either party hereto, except that
the Company shall have the right to assign its rights hereunder to any direct or
indirect subsidiary of the Company, any successor in interest of the Company
whether by merger, consolidation, purchase of assets or otherwise, and any
person controlling or which controls or is under common control with the
Company, any such subsidiary or any such successor; provided, however, that any
such assignment shall not relieve the Company of any of its obligations
hereunder.
7. NOTICES.
All notices requests, demands and other communications hereunder must be
in writing and shall be deemed to have been given if delivered by hand or mailed
by first class, registered mail, return receipt requested, postage and registry
fees prepaid and addressed as follows:
(a) If to the Company:
U.S. Plastic Lumber Corp.
0000 Xxxxxx Xx., Xxxxx 000X
Xxxx Xxxxx, XX 00000
Attention: Xx. Xxxx Xxxxxxxxx, President and CEO
Telecopy: (000) 000-0000
(b) If to Executive, addressed to:
Xxxxxx X. Xxxxx
0000 XxXxxx Xxxxxx
Xxxxxxxxxx, XX 00000
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With a copy to:
Xxxxx Xxxxxx, Esq.
Xxxxxx & Xxxxxxx, P.C.
000 Xxxx Xxx. Xxxxx 000
Xxxx Xxxxxx, XX 00000
Addresses may be changed by notice in writing signed by the addressee.
8. MISCELLANEOUS.
(a) In the event of any breach or enforcement of this Agreement by either
party, the prevailing party in any litigation shall be entitled to an award of
reasonable attorneys' fees and litigation costs.
(b) This Agreement embodies the entire understanding between the parties
hereto respecting the subject matter hereof and no change, alteration or
modification hereof may be made except in writing signed by both parties hereto.
Any prior employment agreement between the Company and Executive shall be deemed
to be superseded for all purposes by this Agreement and, upon the execution and
delivery of this Agreement by Executive and the Company, any such prior
employment agreement shall be deemed to be canceled and of no further force or
effect. The headings in this Agreement are for convenience of reference only and
shall not be considered as part of this Agreement or to limit or otherwise
effect the meaning hereof. If any provisions of this Agreement shall be held
invalid, illegal or unenforceable in whole or in part, neither the validity of
the remaining part of such provisions nor the validity of any other provisions
of this Agreement shall in any way be affected thereby. This agreement shall in
all respects be governed by and construed in accordance with the laws of the
State of Florida.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first above written.
Witnesses: "COMPANY"
By: /s/ Xxxx Xxxxxxxxx
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Xxxx Xxxxxxxxx, President
"EXECUTIVE"
By: /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx
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