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EXHIBIT 10.7
CHIEF EXECUTIVE OFFICER EMPLOYMENT AGREEMENT
THIS CHIEF EXECUTIVE OFFICER EMPLOYMENT AGREEMENT ("Agreement") is made
and entered into effective October 1, 1996, (the "Effective Date"), by and
between EAGLE USA AIR FREIGHT, INC., a Texas corporation with its principal
place of business at ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ Texas
(hereinafter called the ("Company"), and ▇▇▇▇▇ ▇. ▇▇▇▇▇, an individual residing
in ▇▇▇▇▇▇ County, Texas (hereinafter called "Employee").
In consideration of the mutual agreements and covenants herein contained,
the parties hereto agree as follows:
1. SUPERSEDING AGREEMENT. This Agreement supersedes any and all other
employment agreements, written or oral, between the Company and Employee. This
Agreement is entered into in connection with, and contemporaneously with, the
issuance to Employee of Awards (as defined therein) pursuant to the Eagle USA
Freight, Inc. Long-Term Incentive Plan.
2. EMPLOYEE'S REPRESENTATIONS.
(a) Employee is not, nor has Employee ever been, a party to any employment
agreement, expressed or implied, with any employer which requires the
Employee to continue in the employment beyond the effective date of this
Agreement.
(b) The undertaking of this Agreement will not constitute a breach of any
agreement to which Employee is a party or any obligation to which Employee
is bound.
(c) Employee has not, and will not, use or divulge to anyone any of the
"Trade Secrets" of the former employer.
(d) Employee is not bound by any non-disclosure or non-compete agreement
agreements which would in any way effect Employee's performance under this
Agreement.
(e) Employee has no obligations to others which are inconsistent with the
terms of this Agreement or with Employee's faithful performance of duties
as an Employee of the Company.
3. EMPLOYMENT. The Company hereby employs Employee as Chief Executive
Officer for the Company's air freight forwarding operations and to perform such
other duties in connection therewith as the President of the Company may direct
from time to time, including without limitation attendance at management, sales
and other meetings at the Company's office in Houston, ▇▇▇▇▇▇ County, Texas.
Employee hereby accepts such employment and agrees to devote his full time and
attention to the diligent prosecution of the business and affairs of the
Company. Without the prior written consent of the Company,
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Employee shall not serve as a Employee of, or solicit or accept orders for, air
freight forwarding services on behalf of any other person, firm or entity or
accept any other part or full time employment.
4. TERM. The employment provided for hereunder shall commence on the
Effective Date and continue until terminated by the Company or Employee as
hereinafter provided.
5. COMPENSATION. For services rendered by Employee under the terms of this
Agreement, the Company shall compensate Employee a base monthly salary of
$41,666.67, payable bi-weekly in arrears in accordance with the payroll
policies of the Company and subject to normal withholding of state and federal
income, unemployment and FICA taxes.
6. CORPORATE BENEFITS. The Company shall, during Employee's period of
employment, provide Employee the following benefits and perquisites:
(a) Transportation. The Company shall provide Employee a company car, and
the Company shall pay insurance expenses for same, for use on behalf of
and in furtherance of the Company's business.
(b) Expenses. The Company shall reimburse Employee monthly for reasonable
and necessary business expenses he incurs in the performance of his duties
and functions on behalf of the Company; provided, however, that the
Company may refuse to reimburse Employee for expenses in excess of $20 for
which he cannot or does not provide an original credit card receipt or
similar accounting or documentation which states the amount of
expenditure, the date, place, and essential character of the expenditure,
the business reason for the expenditure and/or the nature of the business
derived or expected to be derived as a result of the expenditure.
(c) Insurance. The Company shall provide Employee with dental and medical
insurance coverages at such cost and to the extent made available by the
Company to its Employees generally.
(d) 401(k) Plan Employee shall be entitled to participate in the Company's
401(k) Plan.
(e) The Company shall reimburse Employee for annual dues for the Lochinvar
Club.
(f) The Company shall pay Employee pursuant to the Five-Year Incentive
Plan attached hereto as Exhibit "A."
7. TERMINATION. Notwithstanding any provision hereof to the contrary, and
notwithstanding any provision stating compensation, commissions or other
benefits to be calculated or payable on a monthly, quarterly or annual basis,
either the Company or Employee may terminate this Agreement at any time, with
or without cause, by giving the
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non-terminating party thirty (30) days advance, written notice of termination.
The Company shall have the right to terminate this Agreement for cause
effective immediately on delivery of written or oral notice of termination. For
purposes of this Agreement, "cause" shall include, but shall not be limited to,
(a) Employee's failure or refusal to perform to the satisfaction of the
President of the Company any duty or task delegated to him or Employee's
failure or refusal to observe and keep any and all covenants or obligations on
his part to be performed or kept under the terms of this Agreement or other
policies and guidelines from time to time established by the Company, which
failure or refusal is not cured within ten (10) days after written notice
thereof from the Company, or (b) Employee's malfeasance, theft from the
Company, embezzlement or other illegal conduct which in the judgment of the
Company could damage the business or reputation of the Company.
8. DISCLOSURE OF CONFIDENTIAL BUSINESS INFORMATION. Employee recognizes
and acknowledges that lists of the Company's customers, pricing structures and
policies and credit terms, as they may exist from time to time (collectively
"Business Information"), are valuable, special and unique assets of the
Company's business and constitute confidential and proprietary business
information of the Company. Accordingly, Employee covenants that he will not,
during or after the term of his employment with the Company, disclose Business
Information, or any part thereof, to any person, firm, corporation,
association, or other entity for any reason or purpose whatsoever. Employee
additionally covenants not to disclose to any person, firm, corporation,
association or other entity any other information which is not otherwise known
to the public concerning the business, customers or affairs of the Company or
its subsidiaries or affiliates which he may acquire in the course of or as an
incident to his employment and service on behalf of the Company.
9. COVENANT NOT TO COMPETE. The nature and character of the Company's
business in which Employee will be engaged is air freight forwarding and
related activities. Employee agrees that during the period of his employment
hereunder, and for a period of two years after the termination of his
employment (a) by the Company for cause or (b) voluntarily by Employee, or for
a period of one year after the termination of his employment without cause, he
shall not, directly or indirectly, as an owner, operator, employee,
representative, shareholder, officer, director, partner, venturer, consultant,
advisor or in any other capacity, within a seventy-five (75) mile radius of the
Houston offices or any Company office that Employee may hereafter serve on
behalf of the Company during the term hereof, and regardless of any claims that
either party may have against the other, (x) engage in any business activity in
competition with the business in which the Company is engaged at any time
during his employment or any business activity which the Company is planning or
intends to pursue at the date of termination of Employee's employment, (y)
solicit such business from, or provide such services to, any of the customers
or accounts of the Company, or (z) become the employee of, or otherwise render
services to or on behalf of, any enterprise which competes directly or
indirectly with the business of the Company. Employee agrees that the
limitations set forth on his rights to compete with the Company after
termination of his employment are reasonable and necessary to the protection of
the Company. In this regard, Employee specifically agrees that such limitations
as to the period of time, geographic area and type and scope of restriction on
his activities specified herein are reasonable and necessary for the
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protection of the goodwill or other business interests of the Company. However,
should either the time period or the geographical area provided herein be
deemed invalid or unenforceable in any respect, then Employee recognizes and
agrees that a modification may be made to such time period or geographic area
to protect the Company with respect to the purpose of this covenant not to
compete. This covenant on the part of Employee shall be independent of any
other provision of this Agreement, and the existence of any claim or cause of
action of Employee against the Company, whether predicated on this Agreement or
otherwise, shall not constitute a defense for the enforcement by the Company of
this covenant.
10. NO SOLICITATION. Employee agrees that during the term hereof and for a
period of one year following the termination of Employee's employment, with or
without cause, Employee will not, individually or on behalf of his employer or
any other person or entity, directly or indirectly, solicit, divert, recruit or
employ any employee of the Company or induce any employee of the Company to
terminate his or her employment.
11. INJUNCTIVE RELIEF. Employee recognizes and agrees that any violation
of any of the provisions contained in Sections 7, 8 or 9 hereof will cause such
damage or injury to the Company as would be irreparable and continuing, that
the exact amount of such damage might be difficult to ascertain and that, for
such reason, among others, the Company shall be entitled, as a matter of
course, to a temporary restraining order and a temporary and permanent
injunction restraining any further violation of any such provision. Such right
to injunctive relief shall be in addition to, and not in limitation of, any
other rights and remedies the Company may have against Employee, including
without limitation the right to recover damages for any breach or threatened
breach, including without limitation the recovery of damages from Employee.
12. NOTICE. Any notice given under this Agreement by either party shall be
given in writing. Any such notice shall be deemed to be given upon actual
delivery or when mailed to any such party by registered or certified mail,
postage prepaid, addressed to such party at its address set out below, or at
such other addresses as either party may hereafter designate (by written notice
provided in accordance with this paragraph) as its address for purposes of
notice hereunder:
Employee: ▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Company: Eagle USA Air Freight, Inc.
▇.▇. ▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇. ▇▇▇▇▇, President
13. WAIVER OF BREACH. The waiver by either party of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of
any subsequent breach of the same or any other provision of this Agreement.
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14. ENTIRE AGREEMENT; AMENDMENT. This instrument contains the entire
agreement of the parties with respect to the subject matter hereof. It may be
amended only by an agreement in writing signed by both parties.
15. BENEFITS; ASSIGNMENT. The rights and obligations of the parties under
this Agreement shall inure to the benefit of and shall be binding upon their
respective heirs, successors and assigns. Employee shall not assign his rights,
duties or obligations hereunder without the express written consent of the
Company.
16. APPLICABLE LAW; JURISDICTION. The parties intend and agree that the
terms and provisions of this Agreement and the performance of the parties
hereunder shall be governed by the laws of the State of Texas. The parties
agree to submit to the jurisdiction of the courts located in ▇▇▇▇▇▇ County,
Texas with respect to any matter arising under this Agreement or its
enforcement.
17. SEVERABILITY. In the event that any provision of this Agreement is
declared to be invalid or illegal by final judgment of any court of competent
jurisdiction, the remainder of this Agreement shall remain in full force and
effect notwithstanding the invalidity or illegality of such provision.
IN WITNESS WHEREOF, each of the parties hereby executes this Agreement at
Houston, ▇▇▇▇▇▇ County, Texas on the day and year first above written.
EAGLE USA AIRFREIGHT, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇, President
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇
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EXHIBIT "A"
▇▇▇▇▇ ▇. ▇▇▇▇▇
FIVE YEAR INCENTIVE PLAN
11/30/95
BASE SALARY: $521,000
SALES GOALS & PROJECTED CASH INCENTIVES:
Based on 25% annual sales increases and 10% operating margin
Gross Sales Operating Income Net Income Before Tax Incentive Multiple Projected Cash
Incentives
Fiscal
1996 - 170M x.1 17.0 mil .015 $255,000
1997 - 213M x.1 21.3 mil .015 $319,500
1998 - 266M x.1 26.6 mil .014 $372,400
1999 - 333M x.1 33.3 mil .013 $432,900
2000 - 416M x.1 41.6 mil .013 $540,800
Draws will be paid bi-weekly at $6,923 starting February 1st.
December and January draws will be paid in lump sum of $15,000 for each month.
The account will be balanced at fiscal year end using the above formula.
All incentives will be paid on total net income before tax.
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