Exhibit 10.1.1
EMPLOYMENT AGREEMENT
THIS AGREEMENT (Agreement), dated as of September 1, 1997, between STRATUS
SERVICES GROUP, INC., a Delaware corporation (the Company), and ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇ (the Executive).
W I T N E S S E T H
WHEREAS, the Company desires to employ the Executive, and the Executive
desires to accept such employment, on the terms and conditions set forth herein.
NOW THEREFORE, in consideration of the mutual promises, representations
and warranties set forth herein, and for other good and valuable consideration,
it is hereby agreed as follows:
1. Employment. The Company hereby agrees to employ the Executive, and the
Executive hereby accepts such employment, upon the terms and conditions
set forth herein.
2. Term. Subject to the provisions of Section 9 hereof, the initial term of
the Executive's employment under this Agreement shall commence on the date
hereof and shall end on the third anniversary hereof (herein, the "Term").
3. Position and Duties.
a. The Executive shall serve as the Chairman of the Board and Chief
Executive Officer of the Company and shall have such other duties
consistent with such office, as from time to time may be prescribed
by the Board of Directors of the Company (the "Board").
b. During the Term, the Executive shall perform and discharge the
duties that may be assigned to him by the Company from time to time
in accordance with this Agreement, and the Executive shall devote
his best talents, efforts and abilities to the performance of his
duties.
c. During the Term and any extension thereof, the Executive shall
perform such duties on a substantially full-time basis and the
Executive shall have no other employment and no other outside
business activities whatsoever; provided, however, that the
Executive shall not be precluded from devoting such time to such
other business and personal affairs as shall not materially
interfere with the performance of his duties hereunder.
4. Compensation.
a. For the Executive's services hereunder, the Company shall pay the
Executive an annual salary (as the same may be increased from time
to time, the Base Salary of $275,000, payable in accordance with the
customary payroll practices of the Company.
b. The Base Salary shall be reviewed periodically by the Board and
shall be subject to such increases as the Board, in its sole
discretion, from time to time may determine.
c. In addition to the Base Salary, the Executive shall be entitles to
such bonus or bonuses as the board in its discretion may determine
to award to him from time to time.
d. Concurrently with the commencement date, the Company and Executive
enter into a Stock Option Agreement providing for the grant to the
Executive to purchase an aggregate of two hundred fifty thousand
(250,000) shares of common stock, par value $.01 per share, of the
Company at an exercise price equal to $1.00 per share vested equally
over the term of the contract and granted for a five year period.
5. Benefit Plans. During the Term, the Company shall provide to the Executive
all fringe benefits currently provided, as well as those which the Company
may generally make available to its senior executive employees, including
without limitation, benefits provided under the Company's pension and
profit-sharing plans (if any), health benefit plans (such as medical and
hospitalization coverage), and insurance plans (such as like, supplemental
life, disability, business travel, accident and accidental death and
dismemberment) (collectively, the "Benefit Plans").
6. Automobiles. During the Term, the Company shall provide the Executive with
a Company-owned or leased automobile of a type to be agreed upon by the
Executive and the Company. The Company will bear all insurance, gasoline,
registration, maintenance and repair costs incident to the Executive's use
of such automobile and the performance of his duties hereunder.
7. Reimbursement of Expenses. During the Term, the Company shall pay or
reimburse the Executive for all reasonable travel, entertainment and other
business expenses actually incurred or paid by the executive in the
performance of his duties hereunder upon presentation of expense
statements or vouchers or such other supporting information as the Company
may reasonable require of the Executive.
8. Vacations. The Executive shall be entitled to no less than four (4) weeks
of paid
vacation during each year of the Term (and a pro rata portion thereof for
any portion of the Term and any extension thereof that is less than a full
year).
9. Termination. The employment of the Elective may be terminated prior to the
expiration of the Term in the manner described in this Section 9.
a. Termination by the Company for Good Cause. The Company shall have
the right to terminate the employment of the Elective for Good Cause
(as such term is defined herein) by written notice to the Elective
defined herein) by written notice to the Executive specifying the
particulars for the conduct of the Executive forming the basis for
such termination.
b. Termination by the Executive for Good Reason. The Executive shall
have the right to terminate his employing hereunder for Good Reason
(as such term is defined herein) by written notice to the Company
specifying the ground constituting such Good Reason.
c. Termination upon Death. The employment of the Executive hereunder
shall terminate immediately upon his death.
d. The Company's Options upon Disability. If the executive becomes
physically or mentally disabled during the Term and any extension
thereof so that he is unable to perform the services required of him
pursuant to this agreement for a period of six successive months, or
an aggregate of six months in any twelve-month period (the
"Disability Period"), the Company shall have the option, in its
discretion, by giving written notices thereof, wither to (A)
terminate the Executive's employment hereunder; or (B) continue the
employment of the Executive hereunder upon all the terms and
conditions set forth herein expect that for the balance of the Term
and any extension thereof, the Executive shall receive a Base Salary
equal to 50% of the Base Salary then in effect. Regardless of which
option the Company exercises or shall be deemed to have exercised,
during the disability Period, the Executive shall continue to
receive his full compensation and other benefits provided herein net
of any payment received under the disability policy or program of
which the Executive is a beneficiary or recipient.
e. Termination for any other Reason. Any party purporting to terminate
the employment of the Executive hereunder for any reason not
specified in the foregoing provisions of this Section 9 shall give
the other party notice of such termination in writing and shall
specify in such notice the reasons for such termination.
f. Termination Date. Any notice of termination given pursuant to the
provisions of this Agreement shall specify therein the effective
date of such termination (the "Termination Date").
g. Certain Definitions. For purposes of this Agreement, the following
terms shall have the following meanings:
(i) The "affiliate" of any Person means any other Person directly
or indirectly through one or more intermediary Persons,
controlling , controlled by or under common control with such
Person. For purposes of this definition, "control" shall mean
the power to direct the management and policies of such
Person, directly or indirectly, by through stock ownership,
agency or otherwise, or pursuant to or in connection with an
agreement, arrangement or understanding (written or oral) with
one or more other Persons by or through stock ownership,
agency or otherwise; and the terms "controlling" and
"controlled" shall have meanings correlative to the foregoing.
"Change of Control" with respect to the Company, means
the occurrence of any of the following (A) the acquisition
directly or indirectly (in on or more related transactions) by
any Person (other than Executive), or two or more Persons
acting as a group, of beneficial ownership (as that term is
defined in Rule 13d-3 under the Securities Exchange Act of
1934) of more than 20% of the outstanding capital stock of the
Company entitled to vote for the election of directs ("Voting
Shares"); (B) the merger or consolidation of the Company with
one or more other corporations as a result of which the
holders of the outstanding Voting Shares of the Company
immediately before the merger hold less than 80% of the Voting
Share of the surviving or resulting corporation; (C) the sale
of all or substantially all of the assets of the Company or
its subsidiaries taken as a whole, and this Agreement is not
assumed by the acquiring Person in connection therewith; (D)
the Company or any of its shareholders enters into any
agreement providing for any of the foregoing and the
transaction contemplated thereby is ultimately consummated; or
(E) individuals who at the date hereof constitute the Board of
Directors or the Company cease for any reason to or the
nomination for election by the Company's stockholders, of each
new director as approved by a vote of a majority of the
directors then still in office who
were directory at the date hereof.
(ii) "Good Cause" shall exist if, an only if, the Executive (A)
wilfully or repeatedly fails in any material respect to
perform his obligations hereunder as provided herein, provided
that such Good Cause shall not exist unless the Company shall
first have provided the Executive with written notice
specifying in reasonable detail the factors constituting such
material failure and such material failure shall not have been
cured by the Executive within 30 days after such notice or
such longer period as may reasonably necessary to accomplish
the cure; (B) has been convicted of a crime which constitutes
a felony or misdemeanor under applicable law or has entered a
plea of guilty or nolo contendere with respect thereto; (C)
has committed any such act which constitutes fraud or gross
negligence under applicable law; (D) is determined by the
Board to dependent upon alcohol or drugs; or (E) or during the
Term, the Executive is determined by the board to be in
violation for the provisions of Section 11 or 12 hereof.
(iii) "Good Reason" means the occurrence of any of the following
events:
(A) The assignment to the Executive of any duties
inconsistent in any material respect with the
Executive's then position (including status, offices,
titles and reporting relationships), authority, duties
or responsibilities, or (ii) any other action by the
Company which when taken as a whole results in a
significant diminution in the Executive's position,
authority, duties or responsibilities, excluding for
this purpose any isolated, immaterial and inadvertent
action not taken in bad faith and which is remedied by
the Company promptly after receipt of notice thereof
given by the Executive;
(B) A reduction by the Company in the Executive's Base
Salary unless, at the time of the reduction: (1) the
Base Salary is in excess of $200,000 and (2) the
percentage reduction is such Base Salary does not exceed
the percentage reduction in the Company's gross sales
over the prior twelve-month period;
(C) A Change of Control of the Company;
(D) The Company requiring the Executive to be based at any
location other than within 50 miles of the Company's
current executive office location, except
for requirements of temporary travel on the Company's
business to an extent substantially consistent with the
Executive's business travel obligations existing
immediately prior to the date hereof;
(E) Any purported termination by the Company of the
Executive's employment otherwise than as expressly
permitted by this Agreement.
(iv) "Person" means any individual, corporation, partnership,
association, joint-stock company, trust, unincorporated
organization, joint venture, court or government (or political
subdivision or agency thereof).
10. Obligations of Company on Termination. The Company's obligations on
termination of the Executive's employment shall be as described in this
Section 10.
(a) Amount of Severance Payment in Certain Events. Upon termination of
the Executive's employment: pursuant to Sections 9(b) or 9(e), the
Company shall pay the Executive a lump sum cash payment equal to 2.9
times the Base Salary then in effect, plus any accrued and unpaid
bonuses and unreimbursed expenses, provided, however, that in the
event the aggregate amount of the salary, stock options or other
compensation would constitute an "express parachute payment" under
the Internal Revenue Code and applicable regulation as then in
effect, then such amounts shall be regulations as then in effect,
then such amounts shall be reduced accordingly so as to not
constitute an "excess parachute payment" (collectively, the
"Severance Payment")/
(b) Manner in which Severance Payment is to be Made. The Severance
Payment shall be payable within 60 days after the Termination Date.
(c) Payment Obligations of the Company in case of Termination for death,
Voluntary Resignation or Good Cause. Upon termination of the
Executive's employment upon death, disability, as a result of the
voluntary resignation of the Executive or for Good Cause, the
Company shall have not payment obligations to the Executive, except
for the payment of any accrued and unpaid compensation (including
unpaid bonuses and other unpaid benefits) and reimbursement of any
unreimbursed expenses
(d) The Executive's Right to Acquire Automobiles. Upon termination of
the Executive's employment with the Company for whatever reason, at
his option to be exercised by the executive giving written notice
thereof within 30 days of the Termination Date, the Executive may
assume all obligations of the Company under the applicable sale or
lease agreements relating to the automobile then being provided by
the Company to the Executive pursuant to Section 6 hereof. If such
automobile has been fully-paid for by the Company, the Executive
shall have the right to purchase it from the Company at it's then
book value.
(e) Continued Medical Coverage. Upon the termination of the Executive's
employment with the Company for whatever reason, to the extent
permitted by applicable law, the Company shall continue to provide
the Executive, at his cost (or at the Company's cost, as the case
may be, in the case of a termination pursuant to Section 9(b) or (e)
, with medical and hospitalization insurance coverage for a period
of the longer of: (I) 18 months from the Termination Date; (ii) the
period prescribed by applicable law or (iii) the period set forth in
the applicable Benefit Plans.
11. Trade Secrets; Confidentiality. The Executive recognizes and acknowledges
that, in connection with his employment with the Company, he has had and
will continue to have access to valuable trade secrets and confidential
information of the Company and its affiliates including, but not limited
to, customer lists, business methods and processes, marketing,
promotional, pricing, financial information and data relating to
empl0oyuees and consultants (collectively, "Confidential Information") and
that such confi9dential Information is being made available to the
Executive only in connection with the furtherance of his employment with
the Company. He Executive agrees that during the Term and thereafter, the
Executive shall not disclose any of such Confidential Information to any
Person, except that disclosure of Confidential Information will be
permitted: (i) to the Company, its affiliates and their respective
advisors; (ii) if such Confidential Information has previously become
available to the public through no fault of the Executive; (iii) if
required by any court or governmental agency or body or is otherwise
required by law; (iv) if necessary to establish or assert the rights of
the Executive hereunder; or (v) if expressly consented to by the Company.
12. Restrictive Covenants. (a) during the Term, any extension thereof, and for
a period of one year immediately following the termination of the
Executive's employment the Executive agrees that he will not engage in or
have any financial interest in any business enterprise in competition with
the Company. For the purposes of this Section 12(a):
(i) A business enterprise in competition with the Company shall mean
enterprise which engages in any business as that conducted by
Company or any subsidiary or affiliate during the twelve months
preceding the date of Executive's termination of employment which
operates anywhere within a radius of 25 miles of any office
maintained by the Company as of the date of termination of
employment; and
(ii) The Executive shall be deemed to be engaged in or to have a
financial interest in such business enterprise if he is an employee,
officer, director, trustee, agent, consultant or partner of any
Person which is engaged in such business or if he owns, directly or
indirectly, stock or securities convertible into or exchangeable for
stock or otherwise has any equity or beneficial interest in such
Person; provided, however, that the ownership of 5% or less of the
outstanding shares of a class of security, which is regularly traded
on a national securities exchange or quoted in an automated
inter-dealer quotation
system, shall not be deemed to be engaging or having a financial
interest in the business of such person.
(b) During the Term any extension thereof and for a period of one year
immediately following the termination of the Executive's employment,
the Executive agrees that he will not directly or indirectly hire or
solicit any employee of the Company or who was an employee of the
Company at any time within the three-month period immediately prior
thereto or encourage an employee or agent of the Company to
terminate such employment or agency relationship.
(c) The Executive acknowledges and agrees that the restrictive covenants
set forth in this Section 12 (the "Restrictive Covenants") are
reasonable and valid in geographical and temporal scope and in all
other respects. If any court determines that any of the Restrictive
Covenants, or any part thereof, is invalid or unenforceable, the
remainder of the Restrictive Covenants shall not thereby be affected
and shall be given full force and effect, without regard to the
invalid or unenforceable parts.
(d) If any court determines that any of the Restrictive Covenants, or
any part thereof, is invalid or unenforceable for any reason, such
court shall have the Power to modify such Restrictive Covenant, or
any part thereof, and, in its modified form, such Restrictive
Covenant shall then be valid and enforceable.
(e) Notwithstanding anything to the contrary contained in this Section
12, the foregoing provisions of the Section 12 shall not apply in
the event that the employment of the Executive is terminated by the
Company without good Cause or by the Executive for Good Reason.
13. Equitable Relief. In the event of a breach or threatened breach by the
Executive of any of the covenants contained in Sections 11 and 12 hereof,
the Company shall be entitled to a temporary restraining order, a
preliminary injunction and/or a permanent injunction restraining the
Executive from breaching or continuing to breach any of said covenants.
Nothing herein contained shall be construed as prohibiting the Company
from pursuing any other remedies that may be available to it for such
breach or threatened breach, including the recovering of damages.
14. Severability. Should any provision of this Agreement be held, by a court
of competent jurisdiction, to be invalid or unenforceable, such invalidity
or unenforceability shall not render the entire Agreement invalid or
unenforceable, and this Agreement and each individual provision hereof
shall be enforceable and valid to the fullest extent permitted by law.
15. Successors and Assigns.
(a) This Agreement and all rights under this Agreement are personal to
the Executive and shall not be assignable other than by will or the
laws of descent. All of the
executive's rights under the agreement shall inure to the benefit of
his heirs, personal representatives, designees or other legal
representatives, as the case may be.
(b) This Agreement shall inure to the benefit of and be binding upon the
Company and its successors and assigns. Any person succeeding to the
business of the Company by merger, purchase, consolidation or
otherwise shall assume by contract or operation of law the
obligations of the Company under this Agreement.
16. Governing Law. This Agreement shall be construed in accordance with and
governed by the laws of the State of New York, without regard to the
conflicts of rules thereof.
17. Notices. All notices, requests and demands given to or made upon the
respective parties hereto shall be deemed to have been given or made three
(3) business days after the date of mailing when mailed by registered or
certified mail, postage prepaid, or on the date of delivery if delivered
by hand, or one business day after the date of delivery by Federal Express
or similar overnight delivery service, addressed to the parties at their
addresses set forth below or to such other addresses furnished by notice
given in accordance with this Section 17:
(a) If to the Company, to ▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, and
(b) If to the Executive, to ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇.
18. Withholding. All payments required to be made by the Company to the
Executive under this Agreement shall be subject to withholding taxes,
social security and other payroll deductions in accordance with the
Company's policies applicable to employees of the Company at the
Executive's level and the provisions of the Benefit Plans.
19. Complete Understanding. This Agreement supersedes any prior contracts,
understandings, discussions and agreements relating to employment between
the parties with respect to the subject matter hereof except as expressly
set forth herein or therein.
20. Modification:Waiver.
(a) This Agreement may be amended or waived if, and only if, such
amendment or waiver is in writing and signed, in the case of an
amendment, by the Company and the Executive or in the case of a
waiver, by the party against whom the waiver is to be effective. Any
such waiver shall be effective only to the extent specifically set
forth in such writing.
(b) No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or
privilege.
21. Mutual Representations.
(a) The Executive represents and warrants to the Company that the
execution and delivery of this Agreement and the fulfillment of the
terms hereof
(i) will not constitute a default under or conflict with any
agreement or other instrument to which he is a party or by
which he is bound and
(ii) do not require the consent of any person.
(b) The Company represents and warrants to the Executive that this
Agreement has been duly authorized, executed and delivered by the
Company and that the fulfillment of the terms hereof
(i) will not constitute a default under or conflict with any
agreement or other instrument to which it is a party or by
which it is bound and
(ii) do not require the consent of any Person.
22. Headings. The headings in this agreement are for convenience of reference
only and shall not control or affect the meaning or construction of this
Agreement.
23. Counterparts. This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument. This
Agreement shall become effective when each party hereto shall have
received counterparts hereof signed by the other party hereto.
24. Options. Notwithstanding anything to the contrary contained herein or in
any other agreement between the Company and the Executive, in the event
that Executive's employment is terminated pursuant to Section 9(b) or 9(e)
hereof, then any stock options heretofore or hereafter granted to
Executive may be exercised in full (to the extent not previously exercised
and provided that the term of the applicable option has not otherwise
expired) at any time within three months after such cessation of
employment.
IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed in
its corporate name by one of its officers duly authorized to enter into and
execute this Agreement, and the Executive has manually signed his name hereto,
all as of the date any year first above written.
STRATUS SERVICES GROUP, INC.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Witness