1
EXHIBIT 10.10
[EAGLEUSA LETTERHEAD]
EMPLOYMENT AGREEMENT
THIS AGREEMENT CREATES AND AFFECTS SIGNIFICANT LEGAL RIGHTS FOR BOTH YOU AND THE
COMPANY. READ IT CAREFULLY AND BE CERTAIN THAT YOU UNDERSTAND IT BEFORE YOU
AGREE TO ITS TERMS. IF YOU THINK YOU MIGHT WISH TO FIRST CONSULT WITH A LAWYER,
THE COMPANY URGES YOU TO DO SO.
THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into between RON
TALLEY (the "Employee") and EAGLE USA AIRFREIGHT, INC. (the "Company").
WHEREAS, the Company wishes to employ Employee under the terms and
conditions set forth below, and the Employee wishes to accept such employment
under the terms and conditions set forth below.
WHEREAS, Employee acknowledges that Employee has read and is fully
familiar with the terms of this Agreement, that Employee has had a reasonable
opportunity to consider this Agreement and to seek legal counsel, and that after
such review, Employee finds that the promises and considerations provided by
Employee in this Agreement are not greater than necessary for the protection of
the Company's good will and legitimate business interests and do not create
undue hardship for the Employee or the public,
NOW, THEREFORE, for and in consideration of the above stated premises,
and the mutual promises and agreements set forth herein, the parties agree as
follows:
1. ARBITRATION. The Company and Employee agree that in the event of any legal
dispute between the parties concerning this Agreement or legal rights
arising from or relating to the employment relationship between the
Company and Employee, the parties shall submit their dispute to binding
arbitration. Provided, however, that the Company may, at any time, pursue
the preliminary injunctive remedies specifically provided for in Paragraph
5(g) below in a court of law and thereafter require arbitration of all
remaining issues of final relief. This provision does not prohibit
Employee from filing a charge with a federal administrative agency.
Insured workers compensation claims (other than wrongful discharge
claims), and claims for unemployment insurance are excluded from
arbitration under this provision. The arbitration will be conducted under
the authority of the Federal Arbitration Act. The Arbitration will be
conducted by the American Arbitration Association, or other mutually
agreeable arbitration service. The arbitrator(s) shall be duly licensed to
practice law in the State of Texas. Either party may pursue a motion for
summary judgment from the arbitrator(s) which shall be decided under the
federal standard. Each party will be allowed at least one deposition. The
arbitrator(s) shall be required to state in a written opinion all facts
and conclusions of law relied upon to support any outcome determinative
error of state or federal law, or to fashion a cause of action or whether
the arbitrator(s) authority has been exceeded will be resolved by summary
judgment in a court of law. In all other respects, the arbitration process
will be conducted in accordance with the American Arbitration Association
employment arbitration rules or other mutually agreeable arbitration
service rules with each party's expenses therefrom to be borne by that
party unless otherwise determined by the arbitrator(s). All proceedings
shall be conducted in Houston, Texas, or another mutually agreeable site.
The duty to arbitrate described above shall survive the termination of
this Agreement. The parties hereby waive trial in a court of law or by
jury. All other rights, remedies, time limitations and defenses applicable
to claims asserted in a court of law will apply in the arbitration.
2. DUTIES. Upon the effective date of this Agreement, Employee (i) shall
commence to perform the duties of the position to which he or she is
assigned, and (ii) shall devote such time, ability, skills and attention
to the business of the Company as shall be reasonably
- --------------------------------------------------------------------------------
EMPLOYMENT AGREEMENT PAGE 1 RON TALLEY
2
necessary to perform the assigned duties and performance targets, (iii)
shall perform the duties in a reasonable, timely and professional manner,
and (iv) shall comply with all applicable policies and rules of the
Company. Employee's position will involve Employee being in charge as the
CHIEF OPERATING OFFICER (CORPORATE) of the Company's operations in the
area assigned to Employee, involves providing unique or special services,
and will require Employee to exercise independent discretion without day
to day supervision.
3. TERM, TERMINATION AND COMPENSATION. The following terms of employment will
apply:
a. TERM. Company agrees to employ Employee for an initial term of
thirty (30) days (the "Initial Term"), and as an Employee with no
definite term or tenure of employment thereafter. Recoverable
damages, if any, for termination of employment will be limited to
the Employee's Ordinary Wages for the remaining portion of the
Initial Term or pay period the Employee is in at the time. "Pay
Period" means the bi-weekly or monthly period within which Employee
receives a pay check. "Ordinary wages" shall be calculated based on
the per diem average of Employee's wages (excluding bonuses,
contests, or other unusual awards) in the previous thirty (30) day
period or such shorter period as Employee has been or presumed to
extend past the Initial Term, or notice period in effect thereafter,
for purposes of any damage calculation.
b. TERMINATION. Employment may be terminated by the Employee, with or
without cause, at any time, so long as fourteen (14) days notice to
the Company is provided. During the Initial Term, employment may
only be terminated by the Company for "cause". After the Initial
Term, Company may terminate Employee's employment (a) at its
discretion, with or without "cause", upon fourteen (14) days notice,
or (b) without any notice for "cause". As used here, "cause" will
include death, the elimination of Employee's position, an indication
of any intent to quit by Employee, insubordination, lies or
misrepresentations to the Company, inability to perform essential
functions of the job after accommodation or leave are applied to the
extent required by law, failure or refusal to perform assigned
duties, fraud, negligence, violation of Company rules of behavior,
or a failure to abide by the terms of this Agreement.
c. EARLY PAYMENT. The Company may buy off the unexpired portion of the
Initial Term or thereafter provide pay in lieu of fourteen days
notice, at any time, by paying Employee his or her ordinary wages
for the remainder of that applicable time period.
d. COMPENSATION. Company shall provide Employee wages and benefits
subject to adjustment at the discretion of the Company during
employment. Employee authorizes the Company to make any deductions
from his or her compensation, including his or her final pay check,
that are deemed necessary by the Company to comply with state or
federal laws on withholdings, to compensate for property not
returned, or to recover advances paid to Employee. To the extent
Employee is paid by commission, Employee understands and agrees that
credit for sales towards a commission are not considered earned
unless full payment is received for the sale and full compliance
with all terms of this Agreement is maintained. As concerns
commissions that are not paid or sales towards a commission that are
not credited at the time Employee's employment with the Company
terminates, the outstanding commission will not be considered earned
or payable, and will be forfeited along with any other incentive
compensation, if the Company determines that Employee has failed to
comply with the protective covenants in sections 4 and 5 below.
- --------------------------------------------------------------------------------
EMPLOYMENT AGREEMENT PAGE 2 RON TALLEY
3
4. BUSINESS INTERESTS AND OBLIGATIONS. The following are the parties'
agreements as to the legitimate protectible business interests of the
Company:
a. TRADE SECRETS. During the Initial Term, and as deemed necessary by
the Company thereafter, Employee will be given access to and allowed
to become familiar with various trade secrets of the Company which
are applicable to the Employee's position under the Company's normal
policies and procedures. These trade secrets may include, without
limitation, compilations of market information, customer lists, and
business plans of the Company. Employee agrees that Employee shall
not disclose any of the trade secrets, directly or indirectly, nor
use them in any way, either during the term of this agreement or at
any time thereafter, except as required in the ordinary course of
Employee's employment for the benefit of Company.
b. CONFIDENTIAL INFORMATION. During the Initial Term, and as deemed
necessary by the Company thereafter, the Company will provide
Employee confidential information, and/or access to confidential
information, that is applicable to the Employee's position under the
Company's normal policies and procedures. The parties agree that,
for purposes of this Agreement, "Confidential Information" is
information acquired by the Employee in the course and scope of his
or her activities for the Company that is designated by the Company
as "confidential" or that the Company indicates through its
policies, procedures, or other instructions should not be disclosed
to anyone outside the Company except through controlled means. The
controlled disclosure of Confidential Information to customers or
vendors for legitimate business purposes and the availability of the
Confidential Information to others outside the Company through
independent investigation and effort will not remove it from
protected as Confidential Information status under this Agreement if
the employee acquired the Confidential Information while employed
with the Company. Employee agrees to use such Confidential
Information for the exclusive benefit of the Company, and Employee
shall not, during employment with the Company or thereafter,
directly or indirectly, use the Confidential Information for any
other purpose. Confidential information may also be protected as
trade secret under Paragraph 4(a) above. Some examples of
Confidential Information are internal financial statements and
analysis, personnel files and evaluations, internal pricing and cost
information, customer lists and contacts information, salary and
compensation information, and information concerning specific
customer needs.
c. GOODWILL. During the Initial Term, and as deemed necessary by the
Company thereafter, Company agrees to provide Employee with
compensation, expense reimbursements in accordance with Company
policy limits, confidential information, and contact with customers,
contractors, vendors and co-workers, in order to help Employee
develop goodwill for the Company, where applicable to Employee's
position under the Company's normal policies and procedures.
Employee agrees to use the goodwill developed with the Company's
customers, contractors, vendors and co-workers for the exclusive
benefit of the Company.
5. PROTECTIVE COVENANTS. Employee agrees that the following covenants are
reasonable and necessary protective covenants for the protection of the
business interests described in Paragraph 4 above:
a. DEFINITIONS. "Competing Business" means any business involving
freight logistics, freight forwarding, or any related activities
that involve the same type of services
- --------------------------------------------------------------------------------
EMPLOYMENT AGREEMENT PAGE 3 RON TALLEY
4
sold by the Company, or any business so similar in nature that it
would displace business opportunities or customers of the Company.
"Covered Customer" means those customer entities and/or persons who
did business with the Company and that Employee either (a) received
Confidential Information about, or (b) had contact with within the
last twenty four (24) month period that Employee was employed with
Company. "Restricted Area" means (a) a one hundred fifty (150) mile
radius of any station of the Company that Employee worked out of,
provided services to, or provided supervision over, and (b) any
location, storefront, address or place of business where a Covered
Customer is present and available for solicitation. Employee may not
circumvent the purpose of any restriction by engaging in business in
the Restricted Area through remote means like telephone,
correspondence, or computerized communication.
b. HANDLING OF COVERED ITEMS. All information and material covered by
Paragraphs 4 (a)-(c) shall remain the exclusive property of the
Company, and shall not be removed from the premises of the company
without the prior consent of the Company. If removed from the
Company premises by consent, such information and material will be
used only for the benefit of the Company in the ordinary course of
business. All documents covered by Paragraphs 4 (a)-(c) are, and
shall continue to be, the property of the Company, and shall,
together with all copies thereof, be returned and delivered to the
Company by Employee immediately without demand, upon the termination
of the Employee's employment with the Company, and shall be returned
at any time if the Company so demands.
c. RESTRICTION ON INTERFERING WITH EMPLOYEE RELATIONSHIPS. Employee
agrees that during employment with Company, and for a period of
twelve (12) complete calendar months following the termination of
Employee's employment with the Company, Employee will not, either
directly or indirectly, hire, call on, solicit, or take away, or
attempt to call on, solicit or take away any of the employees or
officers of the Company or encourage any employees or officers of
the Company to terminate their relationship with the Company,
without the prior written consent of James R. Crane or his designee.
d. RESTRICTION ON INTERFERING WITH CUSTOMER RELATIONSHIPS. Employee
agrees that during employment with the Company, and for a period of
twelve (12) complete calendar months following the termination of
Employee's employment with the Company, Employee will not, directly
or indirectly, except in connection with Employee's employment with
the Company, service, call on, solicit, or take away, or attempt to
call on, solicit, or take away any of the Covered Customers of the
Company in the Restricted Area, without the prior written consent of
James R. Crane or his designee.
e. RESTRICTION ON UNFAIR COMPETITION. Employee agrees that during
employment with the Company, Employee will not participate in any
way in a Competing Business. Employee agrees that for twelve (12)
complete calendar months following termination of employment,
Employee will not actively participate in a Competing Business in
the Restricted Area by providing services (whether as an employee,
agent, consultant, advisor, independent contractor, or other
capacity) to a Competing Business in a position that would involve
the use or disclosure of Company trade secrets or Confidential
Information, that has substantially the same functions and/or
responsibilities as a position Employee held with Company, or that
involves supervision over substantially the same functions and/or
responsibilities.
- --------------------------------------------------------------------------------
EMPLOYMENT AGREEMENT PAGE 4 RON TALLEY
5
Employee agrees that during employment with the Company, Employee
will not participate in any way in a Competing Business. Employee
agrees that for twelve (12) complete calendar months following
termination of employment, Employee will not actively participate in
a Competing Business in the Restricted Area. For purpose of this
paragraph, "actively participate in" includes participating,
directly or indirectly, either as an employee, consultant, partner,
shareholder (other than through ownership of publicly-traded capital
stock of a corporation which represents less than ten percent (10%)
of the outstanding capital stock of such corporation), lender,
corporate officer, director, or in any other capacity, in assisting
a Competing Business if the participation would involve, in any way,
influence or input into the Competing Business' business decisions
or relationships with customers."
Employee agrees that competition in violation of these terms is
intrinsically unfair to the Company because it would involve
inevitable disclosure of trade secrets and confidential information,
as well as conversion of the Company's investment in goodwill and
training and confusion over company names and associations.
f. SURVIVAL OF COVENANTS. Each restriction set forth in Paragraph 5
hereof shall survive the termination of Employee's employment with
the Company. The existence of any claim or cause of action of the
Employee against the Company whether predicated on this Agreement or
otherwise shall not constitute a defense to the enforcement by the
Company of said covenant. In the event an enforcement remedy is
sought under Paragraph 5(g), the time periods provided for in
Paragraph 5 shall be extended by one day for each day Employee
failed to comply with the restriction at issue.
g. REMEDIES. In the event of breach or threatened breach by Employee of
any provision of Paragraph 5 hereof, the Company shall be entitled
to (i) injunctive relief by temporary restraining order, temporary
injunction, and/or permanent injunction, (ii) recovery of all
attorney's fees and costs incurred by the Company in obtaining such
relief, and (iii) any other legal and equitable relief to which it
may be entitled, including any and all monetary damages which the
Company may incur as a result of said breach or threatened breach.
An agreed amount for the bond to be posted if an injunction is
sought by the Company, is $1,000. The Company may pursue any remedy
available, including declaratory relief, concurrently or
consecutively in any order as to any breach, violation, or
threatened breach or violation, and the pursuit of one such remedy
at any time will not be deemed an election of remedies or waiver of
the right to pursue any other remedy. The Company has the right to
pursue partial enforcement, and/or to seek declaratory relief
regarding the enforceable scope of this Agreement without penalty
and without waiving the Company's right to pursue any other
available remedy subsequent to declaratory relief.
h. EARLY RESOLUTION CONFERENCE. This Agreement is understood to be
clear and enforceable as written and is executed by both parties on
that basis. However, should Employee later challenge any provision
as unclear, unenforceable, or inapplicable to activity that Employee
intends to engage in, Employee will first notify the Company in
writing and meet with a Company representative and a neutral
mediator (if the Company elects to retain one at its expense) to
discuss resolution of any disputes between the parties. Employee
will provide this notification at least fourteen (14) days before
Employee engages in any activity on behalf of a Competing Business
or engages in other activity that could foreseeably fall within a
questioned restriction. The failure to comply with this requirement
shall waive Employee's right to challenge the reasonable scope,
clarity,
- --------------------------------------------------------------------------------
EMPLOYMENT AGREEMENT PAGE 5 RON TALLEY
6
applicability, or enforceability of the Agreement and its
restrictions at a later time. All rights of both parties will be
preserved if the Early Resolution Conference requirement is complied
with even if no agreement is reached in the conference.
i. CHANGES IN RESTRICTIONS. The parties agree that the Company may
change the scope, geography and/or time limitations which apply to
the restrictions in Paragraph 5 as a condition of a reassignment,
promotion, or other change in position, compensation, or duties for
the Employee. The agreements in Paragraphs 4 and 5 are independently
sufficient to support this option provided to the Company. Such a
change in the terms of this Agreement will be made in writing by a
duly authorized officer of the Company. The Company will give the
Employee at least fourteen (14) days written notice of the change in
terms. Employee's act in continuing employment after the effective
date will be deemed an acceptance of the change.
j. ANCILLARY INTERESTS. The parties agree that any one of the
agreements in Paragraphs 4(a) - (c) standing alone, will be deemed
an otherwise enforceable agreement at the time this Agreement was
made, and gives rise to the need for the restrictions in Paragraphs
5 (a) - (h).
6. MERGER OR ACQUISITION DISPOSITION. In the event the Company should
consolidate, or merge into another entity, or transfer all or
substantially all of its assets to another entity, or divide its assets
among a number of entities, this Agreement shall continue in full force
and effect with regard to the surviving entity.
7. NOTICES. All notices, requests, consents, and other communications under
this Agreement shall be in writing and shall be deemed to have been
delivered on the date personally delivered or on the date deposited in a
receptacle maintained by the United States Postal Service for such
purpose, postage prepaid, by certified mail, return receipt requested,
addressed to the Company at:
EAGLE USA AIRFREIGHT, INC.
15350 Vickery Drive
Houston, Texas 77032
Attn: Donna Wheeler Fernandez
and to the Employee at the address set forth below Employee's signature on
the signature page hereto. Either party hereto may designate a different
address by providing written notice of such new address to the other party
hereto.
8. SEVERABILITY. If any provision contained in this Agreement is determined
to be void, illegal or unenforceable, in whole or in part, then the other
provisions contained herein shall remain in full force and effect as if
the provision which was determined to be void, illegal, or unenforceable
had not been contained herein. If the restrictions in paragraph 5 are
deemed unenforceable as written, the parties expressly authorize the court
to revise, delete, or add to the restrictions contained in Paragraph 5 of
the Agreement to the extent necessary to enforce the intent of the parties
and to provide the Company's goodwill, confidential information, and other
business interests with effective protection.
9. WAIVER, OPPORTUNITY TO CURE, MODIFICATION, AND INTEGRATION. The waiver by
any party hereto of a breach of any provision of this Agreement shall not
operate or be construed as a waiver of any subsequent breach by any party;
provided, however, that if Employee becomes aware of any breach of any
material term of this agreement by the Company, Employee will give the
company written notice of the alleged breach within seven (7) days
- --------------------------------------------------------------------------------
EMPLOYMENT AGREEMENT PAGE 6 RON TALLEY
7
and give the Company thirty (30) days to cure such alleged breach.
Employee's failure to provide this notice and opportunity to cure will
waive any right of Employee to assert that alleged breach at a later time.
This instrument contains the entire agreement of the parties. This
Agreement may not be modified, altered or amended except by written
agreement of all the parties hereto, except as provided in Paragraph 5
(i)above or by order of the court pursuant to Paragraph 8 above.
10. BINDING EFFECT. This Agreement shall be binding and effective upon the
Company and its successors and permitted assigns, and upon Employee,
Employee's heirs and representatives.
11. GOVERNING LAW. It is the intention of the parties that the laws of the
State of Texas should govern the validity of this Agreement, the
construction of its terms, and the interpretation of the rights and duties
of the parties hereto; provided, however, that federal law will control as
to the arbitration clause. The agreed venue and jurisdiction for any
claims or disputes under this Agreement is Houston, Texas.
12. REPRESENTATION OF EMPLOYEE. Employee hereby represents and warrants to the
Company that Employee has not previously assumed any obligations
inconsistent with those contained in this Agreement, and will not use,
disclose, or otherwise rely upon any confidential information or trade
secrets derived from any previous employment, if Employee has any, in the
performance of his duties on behalf of the Company.
13. COUNTERPART EXECUTION. This Agreement may be executed in two or more
identical counterparts, each of which shall be deemed an original, but all
of which together shall constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties agree to the foregoing terms with an effective
date of MAY 19, 1998.
EMPLOYEE: /s/ RONALD E. TALLEY
------------------------------
Signature
Printed Name: RONALD E. TALLEY
Address: 46 WINDHAVEN
------------------------------
City, State Zip THE WOODLANDS, TEXAS 77381
------------------------------
COMPANY: EAGLE USA AIRFREIGHT, INC.
By: /s/ JAMES R. CRANE
------------------------------
Printed Name: JAMES R. CRANE
Title: PRESIDENT
- --------------------------------------------------------------------------------
EMPLOYMENT AGREEMENT PAGE 7 RON TALLEY
8
EMPLOYMENT AGREEMENT ADDENDUM
(FOR EXISTING EMPLOYEES)
As an addendum to the Employment Agreement between RON TALLEY (the
"Employee") and EAGLE USA AIRFREIGHT, Inc. (the "Company") dated MAY 19, 1998
(the "Employment Agreement"). Company agrees to pay to Employee the sum of one
hundred dollars ($100) within thirty (30) days of the date of this agreement as
consideration for Employee's agreement to the terms of this Employment Agreement
Addendum, in addition to and in further support of the mutual promises and
agreements set forth in the Employment Agreement. In exchange, Employee agrees:
a) that all rights and remedies provided for in any prior employment
agreements between the parties are fully replaced with the new rights and
remedies provided for in the Employment Agreement
b) that goodwill developed with the Company's customers by Employee in the
past is now the property of the Company, whether previously so agreed or
not
c) that Trade Secrets and Confidential Information of the Company acquired by
Employee during past employment with the Company is now to be used by
Employee for the exclusive benefit of the Company, whether previously so
agreed or not, and
d) that all provisions of the Employment Agreement including, without
limitation, the arbitration clause and protective covenants, will be
complied with by Employee from the date of this addendum forward. The
definitions applied in the Employment Agreement also apply to this
Employment Agreement Addendum.
EMPLOYEE: /s/ RONALD E. TALLEY COMPANY: EAGLE USA AIRFREIGHT, INC.
---------------------------------
Printed Name: RONALD E. TALLEY By: /s/ JAMES R. CRANE
----------------------------- ---------------------------------
Address: 46 WINDHAVEN Printed Name: JAMES R. CRANE
---------------------------------- -----------------------
City,State, Zip:THE WOODLANDS, TEXAS 77381 Title: President
-------------------------- ------------------------------
Date: 5-27-98 Date: 5-19-98
------------------------------------ -------------------------------
- --------------------------------------------------------------------------------
EMPLOYMENT AGREEMENT PAGE 8 RON TALLEY