EXHIBIT 10.9
CERTIFICATE OF UNANIMOUS WRITTEN CONSENT*
OF THE BOARD OF DIRECTORS OF
ENVIRONMENTAL SOLUTIONS WORLDWIDE, INC.
The undersigned, members of the Board of Directors of Environmental
Solutions Worldwide, Inc., a Florida corporation (the "Company" or
"Corporation"), hereby consent in writing to the terms of the proposed
employment agreement annexed hereto and made a part of this consent.
WHEREAS, all independent members of the Compensation Committee have
presented and approved the terms of compensation for John A. Donohoe, Jr., the
Company's Chief Executive Officer and President;
WHEREAS, all eligible members of the Board of Directors have reviewed
and approved the terms of compensation and have requested that the terms of
compensation as approved be memorialized in a written agreement to be presented
to John A. Donohoe, Jr.;
WHEREAS, all eligible members of the Board of Directors are desirous of
entering into an employment agreement with John A. Donohoe, Jr. to serve as the
Company's Chief Executive Officer and President; and
WHEREAS, all eligible members of the Board have reviewed the proposed
employment agreement annexed hereto and made a part of this Consent.
NOW, THEREFORE IT IS,
RESOLVED, that the Employment Agreement annexed hereto accurately
reflects the terms of compensation as recommended by the Compensation
Committee and approved by the Board of Directors.
AND IT WAS FURTHER,
RESOLVED, that Employment Agreement annexed hereto and made a part of
this consent be presented to John A. Donohoe, Jr. by the Company;
AND IT WAS FURTHER,
RESOLVED, that Nitin Amersey as chairman of the Compensation Committee
be authorized to execute the employment agreement as presented on
behalf of the Company; and
AND IT WAS FURTHER,
RESOLVED, that this unanimous written consent shall serve in lieu of a
meeting of the Board of Directors of the Corporation, and the
undersigned hereby waive all requirements as to notice of such meeting.
This Written Consent may be executed in one or more counterparts, all
of which shall be considered one and the same Written Consent. Telecopier
transmission signatures shall be sufficient for execution of this Written
Consent.
IN WITNESS WHEREOF, this certificate is executed as of the date first
above written.
- ---------------------------------
David Johnson
DIRECTOR AND INTERIM CHAIRMAN
- ---------------------------------
Robert R. Marino
DIRECTOR AND EXECUTIVE OFFICER
- ---------------------------------
Nitin Amersey
DIRECTOR
- ---------------------------------
Barry Gross
DIRECTOR
Bengt Odner
DIRECTOR
Page 2 of 2
Donohoe Compensation Consent
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (the "AGREEMENT") made as of the 10th day of
September, 2003 ("EFFECTIVE DATE") by and between Environmental Solutions
Worldwide, Inc., a Florida corporation (the "COMPANY"), and John A. Donohoe, Jr.
("EMPLOYEE").
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, Employee is the President and Chief Executive Officer of
Company;
WHEREAS, the Company wishes to retain Employee on the terms and
conditions hereinafter set forth; and
WHEREAS, Employee desires to work for the Company on the terms and
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
hereinafter contained, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto, intending
to be legally bound, do hereby agree as follows:
1. EMPLOYMENT; TERM. Effective the date first written above, the
Company hereby employs Employee, and Employee hereby accepts employment with the
Company, in accordance with and subject to the terms and conditions set forth
herein. The term of this Agreement shall commence on the day first written above
and, unless earlier terminated in accordance with Paragraph 5 hereof, shall
terminate on the day ending two (2) years, twenty (20) days from the Effective
Date (the "TERM"). Thereafter, unless sooner terminated as provided in this
Agreement.
2. DUTIES
(a) During the Term, Employee shall serve as a President and Chief
Executive Officer of the Company.
(b) Employee shall have such authority and responsibility as may
reasonably be assigned to him by the Board of Directors of the Company in its
discretion.
(c) During the Term, Employee shall devote the majority of his business
time and best efforts to the business and affairs of the Company, except as
otherwise specifically permitted by the Company.
For purposes of this section 2 (c) "MAJORITY" shall mean a minimum of
twenty (20) hours per week.
(d) Employee agrees to perform services on behalf of the Company at
least two (2) days a week in the Company's offices maintained in Telford
Pennsylvania or any other location so designated by the Board of Directors.
Employee will be permitted to maintain a separate office apart from the Company
office(s) and will be entitled to devote business time to the affairs of other
business ventures that Employee may be involved in so long as same do not
conflict or interfere with Employee's services to the Company. Employee
understands and agrees that his first responsibility is to that of the Company
and that should Employee's involvement in other ventures be deemed by the Board
of Directors to conflict or interfere with Employee's service to the Company or
the business affairs of the Company, Employee will be required to immediately
discontinue any activities that are deemed to conflict or interfere with his
obligations to the Company under this Agreement.
3. SALARY, BONUSES AND BENEFITS. As compensation and consideration for
the performance by Employee of his obligations to the Company under this
Agreement, Employee shall be entitled to the compensation and benefits described
in EXHIBIT A attached hereto and made a part hereof (subject, in each case, to
the provisions of Section 5 hereof).
4. EXPENSES. The Company agrees to reimburse Employee up to $2000.00 a
month for all reasonable and necessary travel, business entertainment and other
business expenses including maintaining a separate office and expenses
associated with same as incurred by Employee in connection with the performance
of Employee's duties under this Agreement in accordance with the Company's
policies with respect thereto. Such reimbursements shall be made by the Company
within a reasonable time in accordance with the Company's standard procedures.
Employee agrees to provide vouchers for all of said expenses in accordance with
applicable Internal Revenue Service rules and regulations.
5. TERMINATION. Employee's employment hereunder may be terminated prior
to the end of the Term under the following circumstances:
(a) DEATH. Employee's employment hereunder shall terminate upon
Employee's death.
(b) TOTAL DISABILITY. The Company may terminate Employee's employment
hereunder at any time after Employee becomes "TOTALLY DISABLED." For purposes of
this Agreement, Employee shall be "TOTALLY DISABLED" upon Employee's inability
to perform his duties and responsibilities contemplated under this Agreement for
a period of more than 120 consecutive days due to physical or mental incapacity
or impairment. Such termination shall become effective five (5) days after the
Company gives notice of such termination to Employee, or to Employee's spouse or
legal representative, in accordance with Paragraph 8 hereof.
(c) TERMINATION BY THE COMPANY FOR CAUSE. The Company may terminate
Employee's employment hereunder for Cause at any time after providing written
notice to Employee. For purposes of this Agreement, the term "CAUSE" shall mean
any of the following: (i) perpetration by Employee of an intentional and knowing
fraud against or affecting the Company or any of its affiliates, or any
customer, client, agent or employee of the Company, or any of its affiliates;
(ii) any willful or intentional act by Employee that is reasonably expected, in
the Company's good faith judgment, to materially injure the reputation, business
or business relationships of the Company or any of its affiliates; (iii)
conviction (including conviction on a NOLO CONTENDERE plea) of a felony
involving fraud, dishonesty or moral turpitude as determined by a non-appealable
decision of a court of competent jurisdiction; (iv) the neglect or failure or
refusal of Employee to perform Employee's duties hereunder (other than as a
result of total or partial incapacity due to physical or mental illness); (v)
the breach of a covenant set forth in Paragraph 7 hereof; or (vi) any other
material breach of this Agreement; provided, however, that in the circumstances
described in clauses (iv) or (vi) of this Paragraph 5(c) Employee has failed to
cure such neglect, failure, refusal or breach within ten (10) days after the
receipt of written notice thereof describing in reasonable detail such neglect,
failure, refusal or breach.
(d) TERMINATION BY THE COMPANY WITHOUT CAUSE. The Company may terminate
Employee's employment at any time and for any reason or no reason upon written
notice.
6. COMPENSATION FOLLOWING AND EFFECTS OF TERMINATION PRIOR TO THE END
OF THE TERM. In the event that Employee's employment hereunder is terminated
prior to the end of the Term, Employee shall be entitled only to the following
compensation and benefits upon such termination and such other following effects
of termination shall apply:
(a) TERMINATION BY REASON OF DEATH OR TOTAL DISABILITY OR BY THE
COMPANY FOR Cause. In the event that Employee's employment is terminated prior
to the expiration of the Term by reason of Employee's death or Total Disability
or for Cause pursuant to Paragraph 5(a), 5(b) or 5(c) hereof, respectively, the
Company shall pay the following amounts to Employee (or Employee's spouse or
estate, as the case may be):
i. any accrued but unpaid Base Salary (as defined in, and
determined pursuant to, EXHIBIT A attached hereto) for
services rendered to the date of termination less any amounts
received by Employee under the Company's long-term disability
plan;
ii. any accrued but unpaid Incentive Commission (as defined in,
and determined pursuant to, EXHIBIT A attached hereto) due
Employee as of the date of termination;
iii. any accrued but unpaid expenses required to be reimbursed
pursuant to Section 4 hereof; and
iiii. any accrued but unpaid vacation pay.
The benefits to which Employee and/or Employee's family may be entitled upon
such termination pursuant to the plans, programs and arrangements referred to in
EXHIBIT A attached hereto shall be determined and paid in accordance with the
terms of such plans, programs and arrangements.
(b) TERMINATION BY THE COMPANY WITHOUT CAUSE.
(i) In the event that Employee's employment
is terminated by the Company without Cause, the Company shall pay the following
amounts to Employee:
1. any accrued but unpaid Base Salary (as defined in, and
determined pursuant to, EXHIBIT A attached hereto) for
services rendered to the date of termination;
2. any accrued but unpaid Incentive Commission (as defined in,
and determined pursuant to, EXHIBIT A attached hereto) due
Employee as of the date of termination;
3. any accrued but unpaid expenses required to be reimbursed
pursuant to Section 4 hereof;
4. any accrued but unpaid vacation pay; and
5. for each full 12-month period of service rendered by Employee
to the Company hereunder, measured as of the date immediately
preceding the date of termination, continued payment of one
(1) month of of the Base Salary (as defined in, and determined
pursuant to, EXHIBIT A attached hereto), that he otherwise
would have been entitled to receive pursuant to EXHIBIT A, up
to a maximum of two (2) additional months.
(ii) The benefits to which Employee and/or Employee's family may be
entitled upon termination of Employee's employment by the Company without Cause
pursuant to the plans, programs and arrangements referred to in EXHIBIT A
attached hereto and shall be determined and paid in accordance with the terms of
such plans, programs and arrangements.
(c) NO OTHER BENEFITS OR COMPENSATION. Except as may be specifically
provided under this Agreement or under the terms of any incentive compensation,
employee benefit or fringe benefit plan applicable to Employee at the time of
the termination of Employee's employment prior to the end of the Term, Employee
shall have no right to receive any other compensation or payment, or to
participate in any other plan, arrangement or benefit, with respect to any
future period after such termination.
7. NONCOMPETITION AND NONSOLICITATION; NONDISCLOSURE OF
PROPRIETARY INFORMATION; SURRENDER OF RECORDS.
(a) NONCOMPETITION; NONSOLICITATION.
(i) Employee acknowledges and recognizes the highly competitive nature
of the Company's business and that Employee's knowledge, experience and
expertise, his position with the Company and access to and use of the Company's
confidential records and proprietary information renders Employee special and
unique. In consideration of the amounts that may hereafter be paid to Employee
pursuant to this Agreement (including pursuant to Paragraph 3 hereof), Employee
agrees that during the Term and the Covered Term (as defined below), Employee
shall not, directly or indirectly (as defined below), (x) engage on his own
behalf in a business that produces catalyst based emission control or
remediation devices or processes(as defined below), or (y) own any interest in
or engage in or perform any service for any person, firm, corporation or other
entity, either as a partner, owner, employee, consultant, agent, officer,
director or shareholder that (A) derives substantial revenues from the
production of catalyst based emission control or remediation devices or
processes or (B) is a meaningful competitor of the Company in the production of
catalyst based emissions control or remediation devices or processes; provided,
however, that the provisions of this Paragraph 7(a)(i) shall not apply if
Employee's employment is terminated by the Company without Cause.
(ii) In further consideration of the payment by the Company to Employee
of amounts that may hereafter be paid to Employee pursuant to this Agreement
(including pursuant to Paragraph 3 hereof), Employee agrees that during the Term
and during the Covered Time, Employee shall not (a) directly or indirectly
solicit or attempt to solicit or participate in the solicitation of or otherwise
advise or encourage any employee, agent, consultant or representative of, or
vendor or supplier to, the Company or any of its affiliates to terminate his,
her or its relationship with the Company or any of its affiliates or to reduce
the amount of business it does with the Company or any of their affiliates; or
(b) directly or indirectly solicit or attempt to solicit or participate in the
solicitation of or otherwise advise or encourage any employee, agent, consultant
or representative of the Company or any of its affiliates to become an employee,
agent, representative or consultant of or to any other individual or entity.
(iii) During the Term and during the Covered Time, Employee agrees that
upon the earlier of Employee's (x) negotiating with any Competitor (as defined
below) concerning the possible employment of Employee by the Competitor, (y)
receiving an offer of employment from a Competitor, or (z) becoming employed by
a Competitor, Employee will immediately provide notice to the Company of such
circumstances and provide copies of this Paragraph 7 to the Competitor. Employee
further agrees that the Company may provide notice to a Competitor of Employee's
obligations under this Agreement, including, without limitation, Employee's
obligations pursuant to this Paragraph 7. For purposes of this Agreement,
"COMPETITOR" shall mean during the Term and the Covered Term, any entity that
then engages, directly or indirectly, in the production of catalyst based
emissions control or remediation devices or processes.
(iv) Employee understands that the provisions of this Paragraph 7(a)
may limit Employee's ability to earn a livelihood in a business similar to the
business of the Company but nevertheless agrees and hereby acknowledges that the
consideration provided under this Agreement (including pursuant to Paragraph 3
hereof) is sufficient to justify the restrictions contained in such provisions.
In consideration thereof and in light of Employee's education, skills and
abilities, Employee agrees that Employee will not assert in any forum that such
provisions prevent Employee from earning a living or otherwise are void or
unenforceable or should be held void or unenforceable; provided, however, that
no provision of Paragraph 7(a)(i) hereof shall prohibit Employee from merely
owning (i.e., having no participation or involvement in the management) no more
than four percent (4%) of the outstanding equity securities of any actively
traded public entity.
(v) For purposes of any provision of Paragraph 7 hereof, (x) "COVERED
Time" shall mean the twenty-four (24) months immediately following the
termination or expiration of this Agreement, (y) "directly or indirectly" means
in Employee's individual capacity for his own benefit or as a shareholder,
partner, member or other principal, officer, director, employee, agent or
consultant of or to any individual, corporation, partnership, joint venture,
limited liability company, business trust, association or any other business
entity whatsoever, and (z) "PRODUCTION OF CATALYST BASED EMISSIONS CONTROL OR
REMEDIATION DEVICES OR PROCESSES" shall mean the business the business of
Catalytic converters.
(b) PROPRIETARY INFORMATION. Employee acknowledges that during the
course of Employee's employment with the Company, Employee will necessarily have
access to and make use of proprietary information and confidential records (as
those terms are defined below) of the Company and its affiliates. Employee
covenants that Employee shall not during the Term or at any time thereafter,
directly or indirectly, use for Employee's own purpose or for the benefit of any
individual or entity other than the Company and its affiliates, nor otherwise
disclose to any individual or entity, any proprietary information of which
Employee has knowledge, unless such disclosure has been specifically authorized
in writing by the Company or such affiliates or is required by law. Employee
acknowledges and understands that the term "PROPRIETARY INFORMATION" includes,
but is not limited to: (i) all ideas, inventions, know-how, technology,
formulas, designs, software, programs, algorithms, products, systems,
applications, processes, procedures, methods and improvements and enhancements,
and all related documentation, whether or not patentable, copyrightable or
entitled to other forms of protection, utilized by the Company or its affiliates
or which are, directly or indirectly, related to the business, products or
services, or proposed business, products or services, of the Company or its
affiliates; (ii) the name and/or address of any customer or vendor of the
Company or its affiliates or any information concerning the transactions or
relations of any customer or vendor of the Company or its affiliates with the
Company or any of its stockholders, principals, directors, officers, employees
or agents; (iii) any financial information relating to the Company or its
affiliates and their respective businesses, including, without limitation,
information relating to pricing or marketing methods, sales margins, cost or
source of materials, supplies or goods, capital structure, operating results or
borrowing arrangements; (iv) any information which is generally regarded as
confidential or proprietary in any line of business engaged in by the Company or
its affiliates; (v) any business plans, budgets, advertising or marketing plans;
(vi) any information contained in any of the written or oral policies and
procedures or manuals of the Company or its affiliates; (vii) any information
belonging to customers, vendors or affiliates of the Company or its affiliates
or any other individual or entity which the Company or its affiliates has agreed
to hold in confidence; and (viii) all written, graphic and other material (in
any medium whether in writing, on magnetic tape or in electronic or other form)
relating to any of the foregoing. Employee acknowledges and understands that
information that is not novel or is not copyrighted, trademarked or patented, or
eligible for such or any other protection, may nonetheless be proprietary
information. The term "proprietary information" shall NOT include information
generally available to and known by the public or information that is or becomes
available to Employee on a non-confidential basis from a source other than the
Company (or any of its affiliates) or the Company's stockholders, directors,
officers, employees or agents (other than as a result of a breach of any
obligation of confidentiality).
(c) CONFIDENTIALITY AND SURRENDER OF RECORDS. Employee shall not during
the Term or at any time thereafter (irrespective of the circumstances under
which Employee's employment by the Company terminates), except as required by
law or as is necessary for the performance of Employee's duties under this
Agreement, and only upon prior written notice thereof to the Company, directly
or indirectly, publish, make known or in any manner disclose any confidential
records to, or permit any inspection or copying of confidential records by, any
individual or entity. Employee shall not retain, and will deliver promptly to
the Company, all copies of any of the same following termination of Employee's
employment hereunder for any reason or upon request by the Company. For purposes
of this Paragraph 7, "CONFIDENTIAL RECORDS" means, without limitation, all
correspondence, memoranda, files, manuals, books, lists, financial, operating or
marketing records and customer and vendor records relating to or containing any
proprietary information (in any medium whether in writing, on magnetic tape or
in electronic or other form) or equipment of any kind which may be in Employee's
possession or under Employee's control or accessible to Employee. All
confidential records shall be and remain the sole and exclusive property of the
Company during the Term and thereafter.
(d) COOPERATION. Employee shall, during the Term and thereafter, fully
cooperate with the Company and its affiliates in connection with the prosecution
or defense of any claim, action, arbitration, suit or proceeding against or by a
third party relating to the Company or any of its subsidiaries or Employee or
the performance of his services as an employee or officer of the Company or any
of its affiliates, including, without limitation, providing access to Employee's
files and records that are relevant to such claim, action, arbitration, suit or
proceeding and appearing as a witness in any such claim, action, arbitration,
suit or proceeding. During the Term and thereafter, Employee agrees to give
Company notice of any such claim, action, arbitration, suit or proceeding by a
third party promptly after receipt of any notice given in connection therewith
to Employee by a party other than Company.
(e) NO OTHER OBLIGATIONS. Employee represents that Employee is not
precluded or limited in Employee's ability to undertake or perform the duties
described herein by any contract, agreement or restrictive covenant. Employee
covenants that Employee shall not employ the trade secrets or proprietary
information of any other individual or entity in connection with Employee's
employment by the Company.
(f) DEVELOPMENTS THE PROPERTY OF THE COMPANY. All discoveries,
inventions, ideas, technology, formulas, designs, software, programs,
algorithms, products, systems, applications, processes, procedures, methods and
improvements and enhancements conceived, developed or otherwise made or created
or otherwise produced by Employee at any time, alone or with others, and in any
way relating to the present or proposed business, products or services of the
Company or its affiliates, whether or not subject to patent, copyright or other
protection and whether or not reduced to tangible form, during the period of
Employee's employment with the Company ("DEVELOPMENTS"), shall be the sole and
exclusive property of the Company. Employee agrees to, and hereby does, assign
to the Company, without any further consideration, all Employee's right, title
and interest throughout the world in and to all Developments. Employee agrees
that all such Developments that are copyrightable may constitute works made for
hire under the copyright laws of the United States and, as such, acknowledges
that the Company is the author of such Developments and owns all of the rights
comprised in the copyright of such Developments and Employee hereby assigns to
the Company without any further consideration all of the rights comprised in the
copyright and other proprietary rights Employee may have in any such Development
to the extent that it might not be considered a work made for hire. There shall
be excluded from this Paragraph 7(f) any Development produced by Employee (i)
which is developed by Employee without the use of the Company's property or
facilities, (ii) which does not make use of any proprietary information or
confidential records of the Company or any of its affiliates, and (iii) which
does not relate to the present or proposed business, products or services of the
Company or its affiliates or to the ongoing or planned product development
efforts of the Company or its affiliates. Employee shall make and maintain
adequate and current written records of all Developments and shall disclose all
Developments promptly, fully and in writing to the Company promptly after
development of the same, and at any time upon request; provided, however, that
Developments excluded under the preceding sentence shall be received by the
Company in confidence.
(g) ENFORCEMENT. Employee acknowledges and agrees that, by virtue of
Employee's position with the Company, the services to be rendered by Employee to
the Company under this Agreement and Employee's access to and use of
confidential records and proprietary information, any violation by Employee of
any of the undertakings contained in this Paragraph 7 would cause the Company or
its affiliates immediate, substantial and irreparable injury for which it has no
adequate remedy at law. Accordingly, Employee agrees that in the event of a
breach or threatened breach by Employee of any said undertakings, the Company
will be entitled to temporary and permanent injunctive relief in any court of
competent jurisdiction (without the need to post bond and without proving that
damages would be inadequate). The rights and remedies provided for in this
Paragraph 7 are cumulative and shall be in addition to rights and remedies
otherwise available to the parties hereunder or under any other agreement or
applicable law.
8. NOTICES. Any notice, consent, request or other communication made or
given in accordance with this Agreement shall be in writing and shall be deemed
to have been duly given when actually received or, if mailed, three (3) days
after mailing by registered or certified mail, return receipt requested, to
those person's listed below at their respective addresses listed below or at
such other address or person's attention as each party may specify by notice to
the other in accordance with the provisions of this Paragraph 8:
[Remainder of page intentionally left blank]
If to the Company:
Environmental Solutions Worldwide, Inc.
132 Penn Avenue
Telford, PA 18969
Attention: Company Secretary
Telecopier No.: (215) 721- 2192
If to Employee:
John A. Donohoe, Jr.
132 Penn Avenue
Telford, PA 18969
Telecopier No.: (215) 721- 2192
9. ASSIGNABILITY; BINDING EFFECT. This Agreement is a personal
contract calling for the provision of unique services by Employee, and
Employee's rights and obligations hereunder may not be sold, transferred,
assigned, pledged or hypothecated. In the event of any attempted assignment or
transfer of rights hereunder by Employee contrary to the provisions hereof
(other than as may be required by law), the Company will have no further
liability for payments hereunder. The rights and obligations of the Company
hereunder will be binding upon and run in favor of the successors and assigns of
the Company. This Agreement does not create, and shall not be interpreted or
construed to create, any rights enforceable by any person not a party to this
Agreement, except as specifically provided in Paragraph 6 hereof.
10. COMPLETE UNDERSTANDING; AMENDMENT; WAIVER. This Agreement
constitutes the complete understanding between the parties with respect to the
employment of Employee and supersedes all other prior agreements and
understandings, both written and oral, between the parties with respect to the
subject matter hereof, and no statement, representation, warranty or covenant
has been made by either party with respect thereto except as expressly set forth
herein. This Agreement shall not be altered, modified, amended or terminated
except by a written instrument signed by each of the parties hereto. Any waiver
of any term or provision hereof, or of the application of any such term or
provision to any circumstances, shall be in writing signed by the party charged
with giving such waiver. Waiver by either party hereto of any breach hereunder
by the other party shall not operate as a waiver of any other breach, whether
similar to or different from the breach waived. No delay on the part of the
Company or Employee in the exercise of any of their respective rights or
remedies shall operate as a waiver thereof, and no single or partial exercise by
the Company or Employee of any such right or remedy shall preclude other or
further exercise thereof.
11. SEVERABILITY. If any provision of this Agreement or the
application of any such provision to any party or circumstances shall be
determined by any court of competent jurisdiction to be invalid or unenforceable
to any extent, the remainder of this Agreement, or the application of such
provision to such person or circumstances other than those to which it is so
determined to be invalid or unenforceable, shall not be affected thereby, and
each provision hereof shall be enforced to the fullest extent permitted by law.
To the extent that a court of competent jurisdiction determines that Employee
breached any undertaking in Paragraph 7 hereof, the Company's obligations to
make payments hereunder shall immediately cease, provided that the Company shall
be liable for such payments in the event that the determination of such court is
overturned or reversed by any higher court. If the final judgment of a court of
competent jurisdiction declares that any provision of this Agreement, including,
without limitation, any provision of Paragraph 7 hereof, is invalid or
unenforceable, the parties hereto agree that the court making the determination
of invalidity or unenforceability shall have the power, and is hereby directed,
to reduce the scope, duration or area of the provision, to delete specific words
or phrases and to replace any invalid or unenforceable provision with a
provision that is valid and enforceable and that comes closest to expressing the
intention of the invalid or unenforceable provision, and this Agreement shall be
enforceable as so modified.
12. SURVIVABILITY. The provisions of this Agreement which by
their terms call for performance subsequent to termination of Employee's
employment hereunder, or of this Agreement, shall so survive such termination.
13. GOVERNING LAW; CONSENT TO JURISDICTION. This Agreement
shall be governed by and construed and enforced in accordance with the laws of
the State of New York applicable to agreements made and to be wholly performed
within the State without regard to its conflict of laws provisions. Any action
to enforce this Agreement must be brought in a United States Federal court
situated in the City of New York and County of New York. Each party hereby
waives the right to claim that any such court is an inconvenient forum, or that
there is a more convenient forum, for the resolution of any such action.
14. REPRESENTATION. Employee represents that he has either
been provided or has consulted with independent counsel and financial advisors
prior to executing this Agreement and that this Agreement has been presented to
Employee based upon the recommendation of the Company's compensation committee
and unanimous consent of the Company's independent board.
15. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original but all of
which together will constitute one and the same instrument.
[Remainder of page intentionally left blank]
16. TITLES AND CAPTIONS. All paragraph titles or captions in
this Agreement are for convenience only and in no way define, limit, extend or
describe the scope or intent of any provision hereof.
IN WITNESS WHEREOF, each of the parties hereto has duly executed this
Employment Agreement as of the date first above written.
ENVIRONMENTAL SOLUTIONS WORLDWIDE INC.
By:________________________________
Name:
Title:
EMPLOYEE
-----------------------------------
John A. Donohoe, Jr.
EXHIBIT A TO EMPLOYMENT AGREEMENT
Employee shall receive the following compensation and benefits for the
performance of all his services under the Employment Agreement, dated as of
September 10, 2003, to which this EXHIBIT A is attached. Capitalized terms used,
but not defined, in this EXHIBIT A shall have the same meanings as those in such
Employment Agreement.
(a) Salary. The Company shall pay Employee a base salary (the "BASE
SALARY") of seventy five thousand dollars ($75,000) per annum, payable in
accordance with the Company's payroll practices and subject to all legally
required or customary withholdings.
(b) BONUS SALARY. In addition to the Base Salary during the term,
Employee shall receive as additional compensation (the "BONUS SALARY"), as
follows:
(i) The Company shall pay Employee a bonus salary of One
hundred and fifty thousand dollars ($150,000) on an annual basis
payable quarterly in increments of thirty seven thousand five hundred
dollars ($37,500) starting January 1st 2004, payable in accordance with
the Company's payroll practices and subject to all legally required or
customary withholdings. This bonus salary will be rolled up on a
quarterly basis and payable at the end of each quarter starting March
31st 2004, it is up to the company to have the right to roll these
payments up to no later than June 30th, 2004.
(c) INCENTIVE COMPENSATION. In addition to the Base Salary and the
Additional Salary, Employee shall also be entitled to an incentive commission
during the Term, as follows:
(i) 500,000 stock options with a strike price of 110% of the
fair market value of the Company's common stock as of the date of award
($0.66 exercise price), with the provision that the options are to vest
ONLY upon the Company achieving two (2) consecutive quarters of at
least $50,000 pre-tax profit during the term of this Agreement. The
options awarded as Incentive Compensation shall have an exercise period
of five (5) years from the date of award.
For purposes of this Section (b), "PRE-TAX PROFIT" shall mean
profit before tax on the company's P&L statement filed each quarter to
the SEC.
(d) STOCK OPTIONS. Employee shall be granted by the Board of Directors
of Company 2,000,000 options as set forth herein, which options shall have an
exercise price of 110% of the fair market value of the Company's common stock
($0.66 exercise price) as reported on the Over the Counter Bulletin Board
("STOCK OPTIONS") and which options shall be granted as of the Effective Date
and shall vest as follows, to the extent Employee remains an employee of the
Company: (i) 33.3% of such options shall vest on the Effective Date; (ii) 33.3%
of such options shall vest on the first anniversary of the Effective Date; and
(iii) 33.4% of such options shall vest on the second anniversary of the
Effective Date. The Stock Options shall have an exercise period of five (5)
years from the date of award. Notwithstanding the foregoing, in the event of a
change of control, all un-vested options will vest immediately. There will be no
registration rights to the shares of common stock underlying the options and
Employee agrees to a lockup on the sale of any shares acquired upon exercise of
the Stock Options from the date of exercise of same.
For purposes of this Section (d), "CHANGE OF CONTROL" shall
mean a buy out or take over of the Company whereby more than 50% of the
Company's common stock is acquired directly by a person or entity.
(e) BENEFITS. Employee shall be entitled to participate in any and all
deferred compensation, 401(k) or other retirement plans, medical insurance,
dental insurance, group health, disability insurance, pension and other benefit
plans that are made generally available by Company to its executives who have
similar responsibilities and perform similar functions as Employee. Company in
its sole discretion, may at any time amend or terminate its benefit plans or
programs without any obligation or liability to Employee that has not accrued as
of the date of such amendment or termination.
(f) VACATION. Employee shall be entitled to receive two weeks of annual
vacation in accordance with the Company's vacation policy Employee shall be
entitled to all paid holidays the Company makes available to its employees.
Initials: Company _____
Employee _____
[Remainder of page intentionally left blank]
* Messrs. Donohoe Jr. and Sifer recused themselves from all discussion and
final approval related to the proposed
employment agreement offered to John A. Donohoe, Jr.