Exhibit 10.1
EMPLOYMENT AGREEMENT - XXXXXX XXXXXX
THIS EMPLOYMENT AGREEMENT is entered into as of the day of January 1, 2002,
by and between Xxxxxx Xxxxxx ("Employee") and RECLAMATION CONSULTING AND
APPLICATIONS, INC., a Colorado Corporation with its principal place of business
at 00000 Xxxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxx Xxxxxx, Xxxxxxxxxx 00000
("Company").
1. RECITALS:
1.1 The company is in the business of manufacturing and marketing asphalt,
cement and related products release agents in liquid form that are non-toxic,
non-explosive and environmentally compatible, the formulation and ingredients of
which are confidential.
1.2 Employee has experience in the businesses conducted and to be
conducted by the Employer, or in related businesses, and desires to be
employed by the Company, and the Company desires to employee the Employee,
on the terms and conditions specified below
2. COVENANTS:
In consideration of the recitals and mutual covenants contained herein, the
parties agree that:
2.1 Employment. The Company will employ Employee to serve as President,
with the duties listed and defined by the Company or the Board, in connection
with the Company's operations and Employee does hereby accept such employment,
all subject to the terms and provisions of this Agreement. Employee represents
that he is legally free to enter into this agreement and that it does not
conflict with any of his duties or obligations to any other person and that he
is not in any way restricted by any duties or obligations to any other
person from contributing his knowledge and talents to the Company in performing
his duties hereunder.
2.2 Term. This Agreement shall have an initial three-year term, which
shall be automatically renewed each year thereafter unless the Company, upon
thirty (30) days prior notice notifies Employee of its intent not to renew
the Agreement. Notwithstanding the foregoing, the Company or the Employee
may at any time terminate this Agreement and the employment relationship on
thirty (30) days prior notice to the other, with the consequences hereinafter
set forth.
2.3 Compensation. During the first twelve months of employment, the
Company agrees to compensate Employee (from the commencement of this agreement)
at the rate of not less than $135,200 per year base compensation for the first
year of employment. Thereafter, Employee's annual compensation shall be
increased by 20% on each anniversary date of this agreement, provided that
the Company reaches a minimum net profit of $250,000. In no event shall
Employee's minimum base compensation be reduced below $135,200 per year. Such
compensation shall be payable monthly or on such more frequent basis as the
Company may establish.
2.4 Bonuses. An annual bonus will be paid to Employee, the amount of
which is based upon the Company's net profits and shall be structured as
follows:
June 30, 2002 through June 30, 2003
RCAI % of Salary Salary Bonus
Net Profit Paid as Bonus Amount Amount
$250,000 10% $135,000 $13,500
$500,000 20% $135,000 $27,000
$750,000 30% $135,000 $40,500
$1,000,000 40% $135,000 $54,000
$1,250,000 50% $135,000 $67,500
$1,500,000 60% $135,000 $81,000
$1,750,000 70% $135,000 $94,500
$2,000,000 80% $135,000 $108,000
$2,250,000 90% $135,000 $121,000
$2,500,000 100% $135,000 $135,000
June 30, 2003 through June 30, 2004
RCAI % of Salary Salary Bonus
Net Profit Paid as Bonus Amount Amount
$250,000 10% $160,000 $16,200
$500,000 20% $160,000 $32,400
$750,000 30% $160,000 $48,600
$1,000,000 40% $160,000 $64,800
$1,250,000 50% $160,000 $81,000
$1,500,000 60% $160,000 $97,200
$1,750,000 70% $160,000 $113,400
$2,000,000 80% $160,000 $129,600
$2,250,000 90% $160,000 $145,800
$2,500,000 100% $160,000 $162,000
June 30, 2004through June 30, 2005
RCAI % of Salary Salary Bonus
Net Profit Paid as Bonus Amount Amount
$250,000 10% $194,000 $19,400
$500,000 20% $194,000 $38,800
$750,000 30% $194,000 $58,200
$1,000,000 40% $194,000 $77,600
$1,250,000 50% $194,000 $97,000
$1,500,000 60% $194,000 $116,400
$1,750,000 70% $194,000 $135,800
$2,000,000 80% $194,000 $155,200
$2,250,000 90% $194,000 $174,600
$2,500,000 100% $194,000 $194,000
2.5 Stock Options. The option to purchase 1,500,000 shares of common
restricted stock in the Company has been granted in Employee's name. All
options shall expire 5-years from the vesting date. 550,000 of these options
have been carried over from Employee's previous Employment Agreement with the
Company. Options will be vested annually, subject to continued employment, and
released to Employee as per the schedule below. The corresponding number of
share options shall be vested to Employee at the purchase values and on the
dates indicated.
No. Options Date Available Exercise Price
500,000 January 15, 2002 $0.40 per share
500,000 January 15, 2003 $0.40 per share
500,000 January 15, 2004 $0.40 per share
Additional stock options shall be granted to Employee each year following the
above schedule on the anniversary date of this Agreement, the amount and price
of which to be determined solely by the Company.
2.6 Duties. Employee agrees to devote his energies to the business of the
Company and agrees to perform such reasonable responsibilities and duties as may
be assigned to him from time to time by the Company or by the Company's board of
directors, which shall be consistent with his position as President. In no
event shall the Employee be precluded from activities in professional societies,
or from lecturing or writing in areas of his professional expertise for
reasonable periods, and Employee shall be entitled to retain fees, honoraria,
publication royalties and similar compensation paid as a result of such
activities.
2.7 Additional Benefits. The Company agrees to reimburse Employee
promptly for or to pay on behalf of Employee, any reasonable expenses heretofore
or hereafter incurred by Employee (to the extent not paid by others) in the
furtherance of the goals of the Company upon submission of a satisfactory
accounting by Employee, and to provide Employee with the following additional
benefits:
2.7.1 A minimum of three weeks annual paid vacation. Vacation shall
accrue on a monthly basis or part thereof; however, once unused vacation has
accrued to a maximum of three weeks, accrual of additional vacation shall cease
until the balance of accrued vacation has been reduced below six weeks. The
Company will not cause the vacation accrual to cease by withholding its
approval of any of the Employee's vacation requests.
2.7.2 Any other standard benefits that may be established by the
Company or its affiliates for its employees.
2.8 Non-Disclosure of Confidential Information. It is understood that
employee will acquire and be informed of confidential technical and/or
business information used by and belonging to the Company ("Confidential
Information"), including Confidential Information as defined in the Company's
EMPLOYEE NON- DISCLOSURE AND NON-COMPETITION AGREEMENT. Employee agrees that
some or all of such Confidential Information is in the nature of trade
secrets and is the sole property of the Company. Employee will keep
confidential, and will not disclose to any third person or entity, any
Confidential Information without Employer's consent and pursuant to the
proceedings further defined in the Company's EMPLOYEE NON-DISCLOSURE AND
NON-COMPETITION AGREEMENT.
2.9 Confidentiality after Termination of Employment. Employee agrees that
upon termination of employment, he or she shall surrender promptly to the
Company any and all documents and property of the Company, including, but not
limited to: reports, drawings, manuals, correspondence, customer lists
and other Confidential Information which he or she may possess, and all other
materials and all copies thereof relating in any way to the Company's business,
or in any way obtained by the Employee during the course of his employment, and
that he shall not retain any copies, notes or abstracts of the foregoing.
Employee further agrees that such documents, lists and information shall be
and remain the sole property of the Company. All of the terms of paragraph
2.8 shall remain in full force and effect both during the continuation of
employment of Employee by the Company and after the termination of employment
for any reason.
2.10 Confidentiality. Employee agrees to execute standard Company
documents establishing the Employee's duties of confidentiality and the rights
of the Company to all inventions, trade secrets, etc., developed by the
Employee in the course of his employment, namely the EMPLOYEE NON-DISCLOSURE AND
NON-COMPETITION AGREEMENT.
2.11 Non-Competition. Employee agrees that during the term of his
employment by Company, Employee will not engage in any way whatsoever, directly
or indirectly, in any business that is competitive with the Company and its
subsidiaries and affiliate operations, nor solicit or in any other manner work
for or assist any business which is competitive to the Company and its
subsidiaries and affiliate operations.
2.12 Non-Participation in Competitive Activities. During the term of this
agreement, Employee will undertake no planning for or organization of any
business activity competitive with the work he performs as an Employee of the
Company and its subsidiaries and affiliate operations, and Employee will not
combine or participate with other employees of the Company and its subsidiaries
and affiliate operations for the purpose of organization of any such competitive
business activity.
2.13 Assignment to Company of Proprietary Rights. Employee agrees to
execute any and all documents and take any and all other actions necessary or
desirable for the assignment to the Company and its subsidiaries and affiliate
operations of all of his interests in any Confidential Information, trade
secrets, copyrightable materials and patentable or patented ideas developed by
him, alone or in conjunction with others, in the course of his employment by the
Company.
2.14 Injunctive Relief. The parties hereto agree and acknowledge that many
of the rights conveyed by this Agreement are of a unique and special nature
and that the Company and its subsidiaries and affiliate operations will not have
an adequate remedy at law in the event of failure of Employee to abide by its
terms and conditions, nor will money damages adequately compensate for such
injury. It is, therefore, agreed between the parties that in the event of
breach by Employee of Employee's covenants contained in this Agreement, the
Company and its subsidiaries and affiliate operations shall have the rights,
among other rights, to damages sustained thereby and to a preliminary
or permanent injunction to restrain Employee from the prohibited acts. Employee
agrees that this Paragraph shall survive for one year after the
termination of his employment, and Employee shall be bound by its terms for a
period of one year subsequent to the termination of his employment, providing
that the Company and its subsidiaries and affiliate operations continue to
conduct the same business or businesses as they were conducting during the
period of this Agreement. Nothing herein contained shall in any way limit or
exclude any and all other rights granted by law or equity to the Company
and its subsidiaries and affiliate operations.
2.15 Termination of Employment. If Employee's employment terminates or is
terminated, the rights and obligations of the parties shall depend upon the
reason for termination. Termination may occur for any one of the following
reasons: termination by the Company for cause, termination by the Company
without cause, termination by Employee without cause, termination by Employee
with cause, or termination of Employee by reason of his death or long-term
disability.
2.15.1 Termination by Company for Cause. In the event of termination by
the Company for cause, which shall consist only of specific actions knowingly
and intentionally taken by Employee to the specific material detriment of
the Company and not reasonably intended by him to benefit the company, the
Employee will receive all unpaid salary, bonuses, and other benefits accrued
through the last day of employment. Employee agrees, if he is so terminated
for cause, that, for a period of one year following the termination of
employment of the Employee, Employee will not engage in any way
whatsoever, directly or indirectly, in any business that is competitive with
the Company and its subsidiaries and affiliates utilizing any Confidential
Information acquired while organizing, founding, or acting as an officer,
director or employee of the Company, its subsidiaries or affiliates, nor
solicit customers, investors, service providers, or strategic partners of the
Company, with the Company's, or its subsidiary's or affiliates' business
whether by interfering with or raiding their employees, or disrupting or
interfering with their relationships with customers, investors, service
providers, or strategic partners. Employee will have thirty days after
termination by the Company for cause to challenge the termination. Employee
may challenge the termination by the Company for cause by sending written notice
to that effect to the Company via registered or certified mail, postmarked no
later than 30-days from the date that employee received notice from the Company
that Employee was being terminated by the Company for cause. The Company and
Employee will each select an arbitrator who will each review the facts
surrounding the termination and the challenge. The arbitrators will decide
whether the Company was justified in terminating the Employee for cause. If
the arbitrators cannot agree whether the Company was justified in terminating
Employee for cause, the arbitrators will select a third arbitrator who will
make the determination of whether the Company was justified in terminating
the Employee for cause. The arbitration proceeding shall be conducted in
accordance with the provisions of California's Arbitration act, Code of Civil
Procedure, Sections 1280, et seq. The Company and Employee agree to abide by
the decision of the arbitration.
If the arbitrators agree or if the third arbitrator determines, as applicable,
that the Company was not justified in terminating the Employee for cause, within
72 hours of receiving the arbitration decision that the termination by the
Company for cause was not justified, the Company will pay Employee back pay for
all salaries and benefits from the date of termination through the date of the
arbitration decision. The termination will then be treated as a termination by
the Company without cause, subject to the provisions of subparagraphs
2.15.2 Termination by Company without Cause. In the event of
termination by the Company without cause, i.e., an involuntary termination, or
notification by the Company of an intent not to renew the Agreement pursuant to
paragraph 2.2 of this Agreement, Employee shall be entitled to elect to receive
severance pay equal to 50% of the annual total compensation in effect in the
last month of employment, but in no cause less than $67,600 and will receive
all unpaid salary, bonuses, and other benefits accrued through the last day of
employment.
2.15.3 Termination by Employee without Cause. In the event of
termination by Employee without cause, i.e., a voluntary termination, the
Employee will receive all unpaid salary, bonuses, and other benefits accrued
through the last day of employment. Employee agrees, if he so terminates
without cause, that, for a period of one year following the termination of
employment of the Employee, Employee will not engage in any way whatsoever,
directly of indirectly, in any business that is competitive with the
Company and its subsidiaries and affiliates utilizing any Confidential
Information acquired while organizing, founding, or acting as an officer,
director or employee of the Company, its subsidiaries, or affiliates, nor
solicit customers, investors, service providers, or strategic partners of
the Company, or any of its subsidiaries or operating affiliates; or disrupt,
damage, impair or interfere with the Company's, or its subsidiary's or
affiliates' business whether by interfering with or raiding their employees,
or disrupting or interfering with their relationships with customers,
investors, service providers or strategic partners. Thereafter, he will
be free to so compete or participate with a competitor.
2.15.4 Termination by Employee with Cause. In the event of receipt of
notice of termination by Employee with cause, which shall consist only of a
material breach of the agreement by the Company including, without limitation,
nonpayment of salary or other compensation due, non-reimbursement of business
expenses, or failure to provide either health insurance allowance or
coverage or other benefits, the Company will have thirty days after
receipt of notice of termination by Employee to challenge the termination by
Employee with cause. The Company and Employee will each select an arbitrator
who will each review the facts surrounding the termination and the challenge.
The arbitrators will decide wither the Employee is justified in terminating
with cause. If the arbitrators cannot agree whether the Employee is
justified in terminating with cause, the arbitrators will select a third
arbitrator who will make the determination of whether the Employee is
justified in terminating with cause. The arbitration proceeding shall be
conducted in accordance with the provisions of California's Arbitration act,
Code of Civil Procedure, Sections 1280, et seq. The Company and Employee agree
to abide by the decision of the arbitration.
If the arbitrators agree, or if the third arbitrator determines, as applicable,
that the Employee is justified in terminating with cause, or if the Company
fails to challenge the termination by the Employee with cause within the thirty
day period, the Employee shall be entitled to elect to receive severance pay
equal to 100% of the annual total compensation in effect in the last month of
employment, but in no case less than
$135,200 and will receive all unpaid salary, bonuses, and other benefits accrued
through the last day of employment plus 30 days. If the arbitrators agree, or
if the third arbitrator determines, as applicable, that the Employee is not
justified in terminating with cause, the termination will be treated as a
termination by Employee without cause, subject to the provisions of
subparagraphs 2.15.3.
2.15.5 Termination by Death or Disability. In the event of termination
by reason of death of the Employee or the long-term disability of the
Employee, Employee shall be entitled to termination pay equal to three month's
pay plus three month's benefits, and will receive all unpaid salary, bonuses,
and other benefits accrued through the last day of employment. All payments
due under this paragraph will be made on the date of termination of
employment. For purposes of this section, the Company may terminate the
Employee due to long- term disability if the Employee is unable to perform
any of his duties for a period of ninety consecutive days or more, for
reasons of sickness or injury. Additionally, in the event of the long-term
disability of Employee, if Employee is terminated by the Company and then
subsequently recovers from the disability, Employee will be free to compete in
any way whatsoever, directly or indirectly, in any business that is competitive
with the Company, and may solicit or in any other manner work for or assist
any business which is competitive to the Company.
2.15.6 Severance Pay. If Employee elects to receive the severance pay
provided for in subparagraph 2.15.2 or 2.15.4, whichever is applicable, and that
severance pay together with all other payments required by this Agreement are
paid to Employee in accordance with subparagraph 2.15.7, Employee agrees that
for a period of one year following the termination of employment of the
Employee, Employee will not engage in any way whatsoever, directly or
indirectly, in any business that is competitive with the Company and its
subsidiaries and affiliates utilizing any Confidential Information acquired
while organizing, founding, or acting as an officer, director or employee of the
Company, its subsidiaries or affiliates, nor solicit customers, investors,
service providers, or strategic partners of the Company, or any of its
subsidiaries or operating affiliates; or disrupt, damage, impair or interfere
with the Company's, or its subsidiary's or affiliates' business whether by
interfering with or raiding their employees, or disrupting or interfering with
their relationships with customers, investors, service providers or strategic
partners.
If Employee elects not to receive such severance pay, Employee will be free to
compete in any way whatsoever, directly or indirectly, in any business that is
competitive with the Company, and may solicit or in any other manner work for or
assist any business which is competitive to the Company.
2.15.7 Termination for any reason. In the event of termination for any
reason, all pay due under this Agreement except for severance pay is payable by
the Company on the last day of employment. Severance pay, when applicable, will
be paid as follows: one-half on the last day of employment and the remaining
payments in three equal monthly installments payable on the first of months four
through six.
2.16 Future Agreement. This Agreement and the documents referred to
herein contain the entire agreement of the parties relevant to the subject
matter hereof, and it may be amended only by a written document signed by both
Employee and Company.
2.17 Governing Law. The laws of California, without regard to
conflicts of laws principles thereof, shall govern this agreement.
2.18 Binding Effect. This Agreement shall inure to the benefit of and
be binding upon the heirs, successors and assigns of the parties hereto.
EMPLOYEE:
[Print Name]
RECLAMATION CONSULTING AND APPLICATIONS, INC.
By:
Its.
