Exhibit 10.3
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (this "Agreement"), made and entered into
as of the 1st day of October 1996, by and between COMMODORE APPLIED
TECHNOLOGIES, INC., a Delaware corporation having offices at 000 Xxxx 00xx
Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000 (the "Company"), and XXXXXX X.
XXXX, an individual residing at 0000 Xxxxx Xxxxx, Xxxxxxx, Xxxxx 00000 (the
"Employee").
W I T N E S S E T H:
WHEREAS, the Employee has substantial knowledge and experience
relating to the management and operation of technology-driven developmental
businesses, and the Company desires to obtain, subject to Part A, Section 4
hereof, the full-time services of the Employee to serve in an executive capacity
with the Company; and
WHEREAS, the Employee is ready, willing and able to serve as
an executive officer of the Company, all upon the terms and subject to the
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing premises and
the mutual covenants herein contained, the parties hereto hereby agree as
follows:
Part A. Employment.
1. Duties. Subject to the terms and conditions of this
Agreement, the Company shall employ the Employee and the Employee shall render
services to the Company in the capacities and with the titles of President and
Chief Executive Officer of the Company. In addition, the Employee shall serve in
such capacity and have such title with such of the
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Company's subsidiaries as may be requested from time to time by the Company,
without requirement of any additional compensation to the Employee.
2. Full-Time Employment. Throughout the period of his
employment hereunder, the Employee shall devote his full and entire professional
and business time, attention, knowledge and skills to faithfully, diligently and
to the best of his abilities perform his duties hereunder. It is expected that
the Employee will render his services primarily from the Company's Houston,
Texas office (as and when located), provided that the Employee will engage in
such travelling as may be reasonably required in connection with the performance
of his duties hereunder.
3. Director. The Company will cause the Employee to be elected
a member of the Company's Board of Directors, for so long as the Employee
remains the Company's President and Chief Executive Officer.
4. Interim Transitional Period. For an interim transitional
period through the earlier of December 31, 1996 or the closing date of the
merger between TransAmerican Waste Industries Inc. ("TWI") and Waste Industries
Inc. (the "TWI Merger"), the Employee may continue to serve as the President and
Chief Operating Officer of TWI. During such interim transitional period, the
Employee shall spend at least 50% of his professional and business time in the
performance of his responsibilities hereunder. It is expressly understood and
agreed that the performance of such limited services by the Employee on behalf
of TWI shall not be deemed to be in breach of Part A, Section 2 or Part D,
Section 4 of this Agreement. The Employee may serve on the board of directors of
the surviving corporation resulting from the TWI Merger, if so nominated.
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Part B. Term of Employment; Termination of Agreement.
1. Term. Subject to prior termination in accordance with the
provisions hereof, the term of this Agreement shall commence on the date hereof
and shall continue through and including December 31, 1999 (the "Term").
2. Termination For Cause. Anything contained in Section 1 of
this Part B to the contrary notwithstanding, this Agreement may be terminated at
the option of the Board of Directors of the Company (the "Board") for "Cause"
(as hereinafter defined), effective upon the giving of written notice of
termination to the Employee. As used herein, the term "Cause" shall mean and be
limited to:
(a) any act committed by the Employee against the
Company, or any of its subsidiaries or divisions, constituting: (i) fraud, (ii)
misappropriation of corporate opportunity, breach of fiduciary duty or
non-disclosure of a conflict of interest, (iii) self-dealing, (iv) embezzlement
of funds, (v) felony conviction for conduct involving moral turpitude or other
criminal conduct, or (vi) the disregard by the Employee of the reasonable
directions of the Board; or
(b) the breach or default by the Employee in the
performance of any material provision of this Agreement (including but not
limited to Part D below); or
(c) alcoholism or any other form of addiction which
impairs the Employee's ability to perform his duties hereunder.
3. Death or Disability. Anything contained in Section 1 of
this Part B to the contrary notwithstanding, this Agreement may be terminated by
the Company: (i) upon the death of the Employee, or (ii) on thirty (30) days'
prior written notice to the Employee, in the
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event that the Employee shall be physically or mentally disabled or impaired so
as to prevent him from continuing the normal and proper performance of his
duties and responsibilities hereunder for a period of three (3) consecutive
months. The initial determination as to whether the Employee is disabled or
impaired shall be made by the physician regularly treating the condition causing
the disability. The Company shall have the right to require the Employee to be
examined by a physician duly licensed to practice medicine in the State in which
the Employee has his primary residence to determine such physician's opinion as
to the Employee's disability. If such physician's opinion differs from that of
the physician treating the Employee, or a physician thereafter retained by the
Employee, they shall forthwith select a third physician so licensed whose
opinion, after examination and review of available information, shall be
conclusive and binding upon all parties hereto. All costs of the physician
regularly treating or thereafter retained by the Employee shall be paid by the
Employee. All costs of the physician retained by the Company shall be paid by
the Company. If a third physician is required, then the costs of that physician
shall be paid by the Company.
4. No Further Obligations. Upon any termination of this
Agreement by the Company for "Cause" pursuant to Section 2 of this Part B, or by
reason of the Employee's death or disability pursuant to Section 3 of this Part
B, neither the Company nor any subsidiary or division thereof shall be liable
for or be required to pay to the Employee any further remuneration, compensation
or other benefits hereunder.
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Part C. Compensation; Expenses.
1. Base Salary. As compensation for his services during the
Term, the Company shall pay or cause to be paid to the Employee a fixed base
salary at the annual rate of Two Hundred Fifty Thousand ($250,000) Dollars.
2. Stock Options. In consideration of the Employee's entering
into this Agreement with the Company, the Company is, as of the date hereof,
granting to the Employee a stock option (the "Stock Option") to purchase an
aggregate of 250,000 shares of common stock, par value $.001 per share, of the
Company (the "Common Stock"), at an exercise price per share equal to the
closing sale price of the Common Stock as reported on the American Stock
Exchange on September 30, 1996. Provided that the Employee is in the full-time
employ of the Company on each date of exercise, such Stock Option will be
exercisable as to twenty percent (20%) of such shares commencing on October 1,
1996 (the "Initial Vesting Date") and as to an additional twenty percent (20%)
of such shares commencing on each of the four successive anniversaries of the
Initial Vesting Date. The other terms and conditions of the Stock Option shall
be as set forth in the Company's 1996 Stock Option Plan and in a separate Stock
Option Agreement between the Company and the Employee.
3. Bonuses and Additional Options. The Employee may from time
to time be awarded bonuses under the Company's Executive Bonus Plan, or
otherwise, and/or additional stock options to purchase Common Stock of the
Company based on the achievement (in whole or in part) by the Company of its
business plan. Any and all such bonuses and/or additional stock options
(together, the "Bonuses") shall be in the sole and absolute discretion of the
Board or a committee thereof.
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4. Benefits. In addition to the foregoing Base Salary, Stock
Option and Bonuses, the Employee shall, throughout the period of his employment
hereunder, be eligible to participate in any and all group health, group life
and/or other benefit plans generally made available by the Company to its
employees, provided that nothing herein contained shall be deemed to require the
Company to maintain or continue any particular plan or policy.
5. Vacation. The Employee shall be entitled to up to four (4)
weeks of vacation per year, to be taken at such times as shall be mutually
agreeable to the Company and the Employee, and so as not to unduly interfere
with the business of the Company. The Employee may carry over, to the next
annual period hereunder, up to two (2) weeks of unused vacation time as at the
end of each year of the term of this Agreement.
6. Expenses. In addition to the remuneration set forth above,
throughout the period of the Employee's employment hereunder, the Company shall
also reimburse the Employee or cause the Employee to be reimbursed, upon
presentment by the Employee to the Company of appropriate receipts and vouchers
therefor, for any reasonable business expenses incurred by the Employee in
connection with the performance of his duties and responsibilities hereunder;
provided, however, that in order to be reimbursable hereunder, any such expense
must be deductible (in whole or in part) by the Company for federal income tax
purposes.
Part D. Confidentiality; Non-Competition. As a material inducement to
cause the Company to enter into this Agreement, the Employee hereby covenants
and agrees that:
1. Confidential Information; Personal Relationships. The
Employee shall, at all times during and subsequent to the Term, keep secret and
retain in strictest confidence all confidential matters of the Company, and the
"know-how", trade secrets, technical processes,
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inventions, equipment specifications, equipment designs, plans, drawings,
research projects, confidential client lists, details of client, subcontractor
or consultant contracts, pricing policies, operational methods, marketing plans
and strategies, project development, acquisition and bidding techniques and
plans, business acquisition plans, and new personnel acquisition plans of the
Company and its subsidiaries and divisions (whether now known or hereafter
learned by the Employee), except to the extent that (i) such information is
generally available to the public without restriction, (ii) the Employee obtains
confidentiality agreements with respect to such confidential information, (iii)
the Employee is requested by the Board of Directors of the Company or a
Committee thereof, or by the Chairman of the Company, to disclose such
confidential information, (iv) such information is provided to a customer of the
Company pursuant to a request received from such customer in the ordinary course
of business, or (v) the Employee is under compulsion of either a court order or
a governmental agency's or authority's inquiry, order or request to so disclose
such information.
2. Property of the Company.
(a) Except as otherwise provided herein, all lists, records
and other non-personal documents or papers (and all copies thereof) relating to
the Company and/or any of its subsidiaries or divisions, including such items
stored in computer memories, on microfiche or by any other means, made or
compiled by or on behalf of the Employee, or made available to the Employee, are
and shall be the property of the Company, and shall be delivered to the Company
on the date of termination of the Employee's employment with the Company, or
sooner upon request of the Company at any time or from time to time.
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(b) All inventions, including any procedures, formulas,
methods, processes, uses, apparatuses, patterns, designs, plans, drawings,
devices or configurations of any kind, any and all improvements to them which
are developed, discovered, made or produced, and all trade secrets and
information used by the Company and/or its subsidiaries and divisions
(including, without limitation, any such matters created or developed by the
Employee during the term of this Agreement), shall be the exclusive property of
the Company or the subject subsidiary, and shall be delivered to the Company or
the subject subsidiary (without the Employee retaining any copies, components or
records thereof) on the date of termination of the Employee's employment with
the Company; provided, however, that nothing herein contained shall be deemed to
grant to the Company any property rights in any inventions or other intellectual
property which may at any time be developed by the Employee which is wholly
unrelated to any business then engaged in or under development by the Company.
3. Employees of the Company. The Employee shall not, at any
time (whether during the term of this Agreement or at any time thereafter),
directly or indirectly, for or on behalf of any business enterprise other than
the Company and/or its subsidiaries and affiliates, solicit any employee of the
Company or any of its subsidiaries to leave his or her employment with the
Company or such subsidiary, or encourage any such employee to leave such
employment, without the prior written approval of the Company in each instance.
4. Non-Competition. For so long as the Employee shall be
receiving any compensation or remuneration under this Agreement, and for a
further period of one (1) year thereafter, the Employee shall not, directly or
indirectly, whether individually or as an employee, stockholder (other than the
passive ownership of up to 5% of the capital stock of a
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publicly traded corporation), partner, joint venturer, agent or other
representative of any other person, firm or corporation, engage or have any
interest in any business (other than the Company or any of its subsidiaries or
affiliates) which, in any country in which the Company or any of its
subsidiaries or divisions does or solicits business during the Term, is engaged
in or derives any revenues from performing any functionally equivalent services
or marketing any functionally equivalent products as those services provided and
products marketed by the Company or any of its subsidiaries or divisions during
the Term.
5. Severability of Covenants. The Employee acknowledges and
agrees that the provisions of this Part D are (a) made in consideration of the
premises and undertakings of the Company set forth herein, (b) made for good,
valuable and adequate consideration received and to be received by the Employee,
and (c) reasonable and necessary, in terms of the time, geographic scope and
nature of the restrictions, for the protection of the Company and the business
and good will thereof. It is intended that the provisions of this Part D be
fully severable, and in the event that any of the foregoing restrictions, or any
portion of the foregoing restrictions, shall be deemed contrary to law, invalid
or unenforceable in any respect by any court or tribunal of competent
jurisdiction, then such restrictions shall be deemed to be amended, modified and
reduced in scope and effect, as to duration and/or geographic area, only to that
extent necessary to render same valid and enforceable (and in such reduced form,
such provisions shall then be enforceable), and any other of the foregoing
restrictions shall be unaffected and shall remain in full force and effect.
6. Equitable Remedies. The parties hereby acknowledge that,
in the event of any breach or threatened breach by the Employee of the
provisions of this Part D, the
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Company will suffer irreparable harm and will not have an adequate remedy at
law. Accordingly, in the event of any such breach or threatened breach, the
Company may seek and obtain appropriate equitable relief to restrain or enjoin
such breach or threatened breach and/or to compel compliance herewith.
Part E. Miscellaneous.
1. Binding Effect. All of the terms and conditions of this
Agreement shall be binding upon and inure to the benefit of the Employee, the
Company and their respective heirs, executors, administrators, personal
representatives, successors and permitted assigns.
2. Notices. Except as may otherwise be provided herein, any
notice, request, demand or other communication required or permitted under this
Agreement shall be in writing and shall be deemed to have been given when
delivered personally or when mailed by certified mail, return receipt requested,
addressed to a party at the address of such party first set forth above, or at
such other address as such party may hereafter have designated by notice. Copies
of all notices hereunder shall simultaneously be sent by first class post-paid
mail to Greenberg, Traurig, Hoffman, Lipoff, Xxxxx & Xxxxxxx, Citicorp Center,
000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: Xxxxxxx X. Xxxxx, Esq.
3. Waivers. Neither this Agreement nor any of the terms or
conditions hereof may be waived, amended or modified except by means of a
written instrument duly executed by the party to be charged therewith.
4. Captions. The captions and paragraph headings used in this
Agreement are for convenience of reference only, and shall not affect the
construction or interpretation of this Agreement or any of the provisions
hereof.
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5. Governing Law. This Agreement, and all matters or disputes
relating to the validity, construction, performance or enforcement hereof, shall
be governed by, and construed under, the laws of the State of New York, without
giving effect to principles of conflicts of laws thereof.
6. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original hereof, but all
of which together shall constitute one and the same instrument.
7. Arbitration. Except for any court action or proceeding to
obtain equitable relief in respect of the provisions of Part D above, any
dispute involving the interpretation or application of this Agreement shall be
resolved by final and binding arbitration before an arbitrator designated by,
and mutually acceptable to, the Company and the Employee. In the event that the
parties cannot agree to the appointment of a mutually acceptable arbitrator, the
subject dispute shall be resolved by final and binding arbitration before one or
more arbitrators designated by the American Arbitration Association in New York,
New York, unless mutually agreed to otherwise. The award of any of such
arbitrator(s) may be enforced in any court of competent jurisdiction.
8. Assignment.
(a) This Agreement is intended for the sole and
exclusive benefit of the parties hereto and their respective heirs, executors,
administrators, personal representatives, successors and permitted assigns, and
no other person or entity shall have any right to rely on this Agreement or to
claim or derive any benefit herefrom absent the express written consent of the
party to be charged with such reliance or benefit.
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(b) The Employee may not assign or otherwise transfer
any of his obligations or duties hereunder to any other person, firm or
corporation, it being understood and agreed that this Agreement is intended to
be for the personal services of the Employee only and of no other person.
(c) The Company shall have the right, at any time and
from time to time, to cause any payments required hereunder to be made by any
subsidiary of the Company. Furthermore, the Company may assign this Agreement to
any successor-in-interest who may acquire, whether by direct purchase, sale of
securities, merger or consolidation, the assets, business or properties of the
Company; provided that no such assignment shall relieve the Company of its
duties and obligations to the Employee hereunder, without the prior written
consent of the Employee.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on and as of the date first set forth above.
COMMODORE APPLIED TECHNOLOGIES, INC.
By:/s/ Xxxx X. Xxxxxxxxx
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Xxxx X. Xxxxxxxxx
President and Chief Executive Officer
/s/ Xxxxxx X. Xxxx
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Xxxxxx X. Xxxx
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