Exhibit 10.4
Employment Agreement (▇▇▇▇▇ ▇▇▇▇▇)
EMPLOYMENT AGREEMENT
--------------------
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made this 1st day of April,
1998, by and between Nationwide Electric, Inc., a Delaware corporation with its
principal place of business at ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the
"Company"), and ▇▇▇▇▇ ▇. ▇▇▇▇▇, an individual residing at ____________________
(the "Employee").
RECITALS
--------
The Company desires to employ the Employee, and the Employee desires to be
employed by the Company. In consideration of the mutual covenants and promises
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, the parties
agree as follows:
1. Term of Employment. The Term (the "Initial Term") of this Agreement
shall commence on the date hereof and, subject to the further provisions of this
Agreement, shall end on the 31st day of March, 2001; provided, however, this
Agreement shall be automatically renewed for successive one (1) year periods
("Renewal Term") unless, at least ninety (90) days prior to the expiration of
the Initial Term or any Renewal Term, either party gives written notice to the
other party specifically electing to terminate this Agreement at the end of the
Initial Term or any such Renewal Term.
2. Title; Capacity. The Employee shall serve as Vice President, Chief
Financial Officer and Treasurer of the Company or in such other position as the
Company's Board of Directors (the "Board") may determine from time to time. The
Employee shall be subject to the supervision of, and shall have such authority
as is delegated to him by, the President of the Company.
The Employee hereby accepts such employment and agrees to undertake
the duties and responsibilities inherent in such position and such other duties
and responsibilities as the Board or its designee shall from time to time
reasonably assign to him. The Employee agrees to devote his entire business
time, attention and energies to the business and interests of the Company (and
its affiliates as required by the Company's investments and the Employee's
positions therein) during the Employment Period. The Employee agrees to abide by
the rules, regulations, instructions, personnel practices and policies of the
Company and any changes therein which may be adopted from time to time. The
Employee acknowledges receipt of copies of all such rules and policies committed
to writing as of the date of this Agreement.
3. Compensation and Benefits.
a. Salary. The Company shall pay the employee, in semi-monthly
installments, an annual base salary of $140,000.00 for the one-year period
commencing on the Commencement Date. Such salary shall be subject to adjustment
thereafter as determined by the Board.
b. Fringe Benefits. The Employee shall be entitled to participate in
all bonus and benefit programs that the Company establishes and makes available
to its employees, if any, to the extent that Employee's position, tenure,
salary, age, health and other qualifications make him eligible to participate.
c. Reimbursement of Expenses. The Company shall reimburse the
Employee for all reasonable travel, entertainment and other expenses incurred or
paid by the Employee in connection with, or related to, the performance of his
duties, responsibilities or services under this Agreement, upon presentation by
the Employee of documentation, expense statements, vouchers and/or such other
supporting information as the Company may request, provided, however, that the
amount available for such travel, entertainment and other expenses may be fixed
in advance by the President. Upon prior approval by the President, the Company
shall reimburse Employee, or directly pay for, dues and membership fees for
industry organizations relevant to Employee's duties.
d. Stock. In further consideration of the obligations and
undertakings of the Employee in this Agreement, the Company shall sell certain
shares of its common stock to Employee pursuant to that certain Employee
Restricted Stock Purchase Agreement of even date herewith.
4. Employment Termination. The employment of the Employee by the Company
pursuant to this Agreement shall terminate upon the occurrence of any of the
following:
a. Expiration of the Employment Period in accordance with Section 1;
b. At the election of the Company, for "Cause", immediately upon
written notice by the Company to the Employee. "Cause" for such termination
shall include, but not limited to, the following:
i. Dishonesty of the Employee with respect to the Company;
ii. Willful misfeasance or nonfeasance of duty intended to
injure or having the effect of injuring the reputation, business or business
relationships of the Company or its respective officers, directors or employees;
iii. Upon a charge by a governmental entity against the Employee
of any crime involving moral turpitude which is demonstrably and materially
injurious to the Company or upon the finding of any civil court against the
Employee in an action involving a charge of embezzlement, theft, fraud, or other
similar act which is demonstrably and materially injurious to the Company;
iv. Willful or prolonged absence from work by the Employee
(other than by reason of disability due to physical or mental illness) or
failure, neglect or refusal by the Employee to perform his duties and
responsibilities without the same being corrected upon ten (10) days prior
written notice; or
2
v. Breach by the Employee of any of the covenants contained in
this Agreement.
c. Immediately upon the death or disability of the Employee. As used
in this Agreement, the term "disability" shall mean the inability of the
employee, due to a physical or mental disability, for a period of 90 days,
whether or not consecutive, during any 360 day period to perform the services
contemplated under this Agreement. A determination of disability shall be made
by a physician satisfactory to the Company.
d. At the election of the Company or the Employee, with or without
cause upon 90 days written notice by one party to the other.
5. Effect of Termination.
a. Termination for Cause or at Election of Either Party. In the
event the Employee's employment is terminated for cause pursuant to Section
4(b), or at the election of either party pursuant to Section 4(d), the Company
shall pay to the Employee the compensation and benefits otherwise payable to him
under Section 3 through the last day of his actual employment by the Company.
b. Termination for Death or Disability. If the Employee's employment
is terminated by death or because of disability pursuant to Section 4(c), the
Company shall pay to the estate of the Employee or to the Employee, as the case
may be, the compensation which would otherwise be payable to the Employee up to
the end of the month in which the termination of his employment because of death
or disability occurs.
c. Survival. The provisions of Sections 6 and 7 shall survive the
termination of this Agreement.
6. Non-Compete.
a. Except as provided in Section 6.d., below, during the Employment
Period and for a period of three (3) years after the termination or expiration
thereof, the Employee will not directly or indirectly, in the territory
comprised by the continental United States:
i. as an individual proprietor, partner, stockholder, officer,
employee, director, joint venturer, investor, lender, or in any other capacity
whatsoever (other than as the holder of not more than five percent (5%) of the
total outstanding stock of, a publicly held company), engage in the business of
developing, producing, marketing or selling products or services of the kind or
type developed or being developed, produced, marketed or sold by the Company or
its affiliates, while the Employee was employed by the Company (such products or
services may include, but shall not be limited to, commercial and industrial
electrical contracting services and the acquisition of companies providing such
services);
3
ii. recruit, solicit or induce, or attempt to induce employee
or employees of the Company to terminate their employment with, or otherwise
cease their relationship with, the Company; or
iii. solicit, divert or take away, or attempt to divert or to
take away, the business or patronage of any of the clients, customers or
accounts, or prospective clients, customers or accounts, of the Company which
were contacted, solicited or served by the Employee while employed by the
Company.
b. If any restriction set forth in this Section 6 is found by any
court of competent jurisdiction to be unenforceable because it extends for too
long a period of time or over too great a range of activities or in too broad a
geographic area, it shall be interpreted to extend only over the maximum period
of time, range of activities or geographic area as to which it may be
enforceable.
c. The restrictions contained in this Section 6 are necessary for
the protection of the business and goodwill of the Company and are considered by
the Employee to be reasonable for such purpose. The Employee agrees that any
breach of this Section 6 will cause the Company substantial and irrevocable
damage and therefore, in the event of any such breach, in addition to such other
remedies which may be available, the Company shall have the right to seek
specific performance and injunctive relief. The prevailing party in a legal
proceeding to remedy a breach under this Agreement shall be entitled to receive
its reasonable attorney's fees, expert witness fees, and out-of-pocket costs
incurred in connection with such proceeding, in addition to any other relief it
may be granted.
d. The restrictions set forth in Section 6.a. shall extend for a
period of one (1) year after termination if such termination was at the election
of the Company without cause, or by the Employee on account of a breach of a
material provision of this Agreement by the Company. In addition, the Employee
may, upon retirement, but no earlier than age 60, act as a consultant to
businesses engaged in activities similar to those of the Company, provided all
other terms and conditions of this Agreement are honored by the Employee.
e. If this Agreement is terminated within ninety (90) days of the
change of control of the Company, then the restrictions contained in Section
6.1.(i) shall be eliminated. Notwithstanding the above, at the Company's
election, the Company may continue to compensate the Employee based on the
Compensation outlined in Section 3 above and Employee agrees to maintain the
restrictions contained in Section 6.1.(i). For the purposes of this Agreement
"change of control" shall be defined as any person (as that term is used in
Section 13(e) and 14(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act)), other than the holders of any of the Company's securities as of
the date of this Agreement, is or becomes the beneficial owner (as defined in
Rule 13d-3 promulgated under the Exchange Act) directly or indirectly of
securities of the Company representing a majority of the combined voting power
of the Company's then outstanding securities (assuming conversion of all
outstanding convertible non-voting securities into voting securities and the
exercise of all outstanding options and all other securities which are
convertible to voting securities), or upon the approval by the Company's
shareholders of (A) the sale of all or
4
substantially all of the assets of the Company, (B) the merger or consolidation
or any reorganization or restructuring of the Company (other than a merger,
consolidation, reorganization or restructuring in which the Company is the
surviving corporation and which does not result in any capital reorganization or
reclassification or other change in the ownership of the Company's then
outstanding shares that would be deemed a change in control pursuant to clause
(i), above), or (C) a plan of liquidation or dissolution of the Company.
7. Proprietary Information and Developments
a. Proprietary Information.
i. Employee agrees that all information and know-how, whether
or not in writing, of a private, secret or confidential nature concerning the
Company's business or financial affairs (collectively, "Proprietary
Information") is and shall be the exclusive property of the Company. By way of
illustration, but not limitation, Proprietary Information may include
inventions, products, processes, methods, techniques, formulas, compositions,
compounds, projects, developments, plans, research data, clinical data,
financial data, personnel data, computer programs, and customer and supplier
lists. Employee will not disclose any Proprietary Information to others outside
the Company or use the same for any unauthorized purposes without written
approval by an officer of the Company, either during or after his employment,
unless and until such Proprietary Information has become public knowledge
without fault by the Employee.
ii. Employee agrees that all files, letters, memoranda,
reports, records, data, sketches, drawings, laboratory notebooks, program
listings, or other written, photographic, or other tangible material containing
Proprietary Information, whether created by the Employee or others, which shall
come into his custody or possession, shall be and are the exclusive property of
the Company to be used by the Employee only in the performance of his duties for
the Company.
iii. Employee agrees that his obligation not to disclose or use
information, know-how and records of the types set forth in paragraphs (a) and
(b) above, also extends to such types of information, know-how, records and
tangible property of customers of the Company or suppliers to the Company or
other third parties who may have disclosed or entrusted the same to the Company
or to the Employee in the course of the Company's business.
b. Developments.
i. Employee will make full and prompt disclosure to the
Company of all inventions, improvements, discoveries, methods, developments,
software, and works of authorship, whether patentable or not, which are created,
made, conceived or reduced to practice by the Employee or under his direction or
jointly with others during his employment by the Company, whether or not during
normal working hours or on the premises of the Company (all of which are
collectively referred to in this Agreement as "Developments").
5
ii. Employee agrees to assign and does hereby assign to the
Company (or any person or entity designated by the Company) all his right, title
and interest in and to all Developments and all related patents, patent
applications, copyrights and copyright applications. However, this Section
7.2(b) shall not apply to Developments which do not relate to the present or
planned business or research and development of the Company and which are made
and conceived by the Employee not during normal working hours, not on the
Company's premises and not using the Company's tools, devices, equipment or
Proprietary Information.
iii. Employee agrees to cooperate fully with the Company, both
during and after his employment with the Company, with respect to the
procurement, maintenance and enforcement of copyrights and patents (both in the
United States and foreign countries) relating to Developments. Employee shall
sign all papers, including, without limitation, copyright applications, patent
applications, declarations, oaths, formal assignments, assignment of proprietary
rights, and powers of attorney, which the Company may deem necessary or
desirable in order to protect its rights and interests in any Development.
c. Other Agreements. Employee hereby represents that he is not bound
by the terms of any agreement with any previous employer or other party to
refrain from using or disclosing any trade secret or confidential or proprietary
information in the course of his employment with the Company or to refrain from
competing, directly or indirectly, with the business of such previous employer
or any other party. Employee further represents that his performance of all the
terms of this Agreement and as an employee of the Company does not and will not
breach any agreement to keep in confidence proprietary information, knowledge or
data acquired by him in confidence or in trust prior to his employment with the
Company.
d. Company's Right to Notify Subsequent Employers. The Company may
do all permissible things, and take all permissible action, necessary or
advisable, in the Company's discretion, to protect its rights under this Section
7, including without limitation notifying any subsequent employer of the
Employee of the existence of (and furnishing to any such employer) the
provisions of this Agreement.
8. Liquidated Damages. Insofar as any damages sustained by the Company in
the case of a breach by the Employee of the provisions of this Agreement are
difficult to calculate, the parties hereto agree that if the Employee breaches
or violates any provision of this Agreement, the Company shall be entitled, in
addition to any other right and remedy available to it, to retain as liquidated
damages any sums owed but not paid by the Company to the Employee.
9. Notices. All notices required or permitted under this Agreement shall
be in writing and shall be deemed effective upon personal delivery or upon
deposit in the United States Post Office, by registered or certified mail,
postage prepaid, addressed to the other party at the address shown above, or at
such other address or addresses as either party shall designate to the other in
accordance with this Section 9.
6
10. Pronouns. Whenever the context may require, any pronouns used in this
Agreement shall include the corresponding masculine, feminine or neuter forms,
and the singular forms of nouns and pronouns shall include the plural, and vice
versa.
11. Entire Agreement. This Agreement constitutes the entire agreement
between the parties and supersedes all prior agreements and understandings,
whether written or oral, relating to the subject matter of this Agreement.
12. Amendment. This Agreement may be amended or modified only by a written
instrument executed by both the Company and the Employee.
13. Governing Law. This Agreement shall be construed, interpreted and
enforced in accordance with the laws of the State of Missouri, without giving
effect to that State's conflict of laws provisions.
14. Choice of Venue. All actions or proceedings with respect to this
Agreement shall be instituted only in any state or federal court sitting in
▇▇▇▇▇▇▇ County, Missouri, and by execution and delivery of this Agreement, the
parties irrevocably and unconditionally subject to the jurisdiction (both
subject matter and personal) of each such court and irrevocably and
unconditionally waive: (a) any objection that the parties might now or hereafter
have to the venue of any of such court; and (b) any claim that any action or
proceeding brought in any such court has been brought in an inconvenient forum.
15. Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of both parties and their respective successors and assigns,
including any corporation with which or into which the Company may be merged or
which may succeed to its assets or business, provided, however, that the
obligations of the Employee are personal and shall not be assigned by him.
16. Waiver. No delay or omission by the Company in exercising any right
under this Agreement shall operate as a waiver of that or any other right. A
waiver or consent given by the Company on any one occasion shall be effective
only in that instance and shall not be construed as a bar or waiver of any right
on any other occasion.
17. Captions and Headings. The captions of the sections of this Agreement
are for convenience of reference only and in no way define, limit or affect the
scope or substance of any section of this Agreement.
18. Severability. In case any provision of this Agreement shall be
invalid, illegal or otherwise unenforceable, the validity, legality and
enforceability of the remaining provisions shall in no way be affected or
impaired thereby.
19. Counterparts. This Agreement may be executed in a number of
counterparts and all of such counterparts executed by the Company or the
Employee, shall constitute one and the same agreement, and it shall not be
necessary for all parties to execute the same counterpart hereof.
7
20. Facsimile Signatures. The parties hereby agree that, for purposes of
the execution of this Agreement, facsimile signatures shall constitute original
signatures.
21. Incorporation by Reference. The preamble and recitals to this
Agreement are hereby incorporated by reference and made a part hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year set forth above.
Nationwide Electric, Inc.
A Delaware Corporation
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chairman of the Board
EMPLOYEE:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇
8