Exhibit 10.46
EMPLOYMENT AGREEMENT
This employment agreement (this "AGREEMENT") dated as of April 1, 2003 (the
"EFFECTIVE DATE"), is entered into by and between MOTORCAR PARTS & ACCESSORIES,
INC., a New York corporation currently having an address at 2929 California
Street, Torrance, California 90503 (together with its subsidiaries and
affiliates, the "COMPANY"), and Charles W. Yeagley, an individual residing at
1401 Launer Drive, La Habra, California 90631 ("EMPLOYEE").
WITNESSETH:
WHEREAS, the COMPANY desires to continue to employ EMPLOYEE as its Chief
Financial Officer (or such other position as shall be determined by the Board of
Directors of the COMPANY, or any duly authorized and acting committee thereof,
the "BOARD OF DIRECTORS") and EMPLOYEE desires to be so employed by the COMPANY,
all upon the terms and subject to the conditions contained herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. EMPLOYMENT; 2001 AGREEMENT. Subject to and upon the terms and conditions
contained in this AGREEMENT, the COMPANY hereby agrees to employ EMPLOYEE
and EMPLOYEE agrees to continue in the employ of the COMPANY, for the
period set forth in Paragraph 2 hereof, to render the services to the
COMPANY, its Affiliates and/or subsidiaries described in Paragraph 3
hereof. The Employment Agreement between the COMPANY and the EMPLOYEE
dated as of November 6, 2001 (the "2001 AGREEMENT") shall terminate as of
the EFFECTIVE DATE; provided, however, that any Bonus due EMPLOYEE as
provided in the 2001 AGREEMENT with respect to the fiscal year ending
March 31, 2003 and any other benefits due and unpaid to EMPLOYEE
thereunder on the EFFECTIVE DATE shall be paid as provided therein.
2. TERM. EMPLOYEE'S term of employment under this AGREEMENT shall commence on
the EFFECTIVE DATE and shall continue for a period through and including
March 31, 2006, (the "EMPLOYMENT TERM") unless extended in writing by both
parties or earlier terminated pursuant to the terms and conditions set
forth herein.
3. DUTIES.
(a) Unless otherwise determined by the BOARD OF DIRECTORS, EMPLOYEE
shall be employed as the COMPANY'S Chief Financial Officer and shall
report to the COMPANY'S President and Chief Executive Officer. It is
agreed that EMPLOYEE shall perform his service in the COMPANY'S
Torrance, California, facilities, or any other facilities mutually
agreeable to the parties.
(b) EMPLOYEE agrees to abide by all By-Laws and applicable policies of
the Company, including but not limited to the Company's Code of
Business Conduct and Ethics, promulgated at any time and from time
to time by the BOARD OF DIRECTORS, and the directions of the
COMPANY'S President and Chief Executive Officer.
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4. EXCLUSIVE SERVICES AND BEST EFFORTS. EMPLOYEE shall devote all of his
working time, attention, best efforts and ability to the service of the
COMPANY during the term of this AGREEMENT.
5. COMPENSATION. As compensation for his services and covenants hereunder,
the COMPANY shall pay EMPLOYEE the following:
(a) Base Salary. The COMPANY shall pay EMPLOYEE a base salary ("SALARY")
of Two Hundred Fifteen Thousand Dollars ($215,000) per year.
(b) Bonus. EMPLOYEE shall participate in the COMPANY'S Executive Bonus
Program as and when adopted and amended from time to time by the
BOARD OF DIRECTORS. In the event of any part-year service by the
EMPLOYEE, any Bonus shall be prorated (as reasonably determined by
the BOARD OF DIRECTORS) for any part year service by EMPLOYEE.
6. BUSINESS EXPENSES. EMPLOYEE shall be reimbursed for, and entitled to
advances if permitted by applicable law (subject to repayment to the
COMPANY if not actually incurred by EMPLOYEE) with respect to, only those
business expenses incurred by him which are reasonable and necessary for
EMPLOYEE to perform his duties under this AGREEMENT in accordance with
policies established from time to time by the COMPANY. All expenditures
and advances in excess of Five Hundred Dollars ($500.00) must be approved
by the President and Chief Executive Officer of the COMPANY prior to being
incurred or advanced.
7. EMPLOYEE BENEFITS.
(a) EMPLOYEE shall be entitled to three (3) weeks paid vacation each
year during the EMPLOYMENT TERM at such times as do not, in the
opinion of the President and Chief Executive Officer, interfere with
EMPLOYEE'S performance of his duties hereunder.
(b) During the term of this AGREEMENT, if EMPLOYEE does not elect
medical insurance coverage for himself and his eligible family
through the COMPANY, he shall receive as an allowance for such
medical insurance an amount equal to the then cost which would be
incurred by the COMPANY in supplying such coverage for EMPLOYEE and
his eligible family. The COMPANY may withhold from any benefits
payable to EMPLOYEE all federal, state, local and other taxes and
amounts as shall be permitted or required pursuant to law, rule or
regulation. All of the benefits to which EMPLOYEE may be entitled
may be changed from time to time or withdrawn at any time in the
sole discretion of the COMPANY.
(c) During the EMPLOYMENT TERM the COMPANY shall provide to executive an
automobile allowance in the amount of Five Hundred Dollars ($500.00)
per month, payable monthly.
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8. DEATH AND DISABILITY.
(a) The EMPLOYMENT TERM shall terminate on the date of EMPLOYEE'S death,
in which event EMPLOYEE'S accrued SALARY and BONUS, reimbursable
expenses and benefits, including accrued but unused vacation time,
owing to EMPLOYEE through the date of EMPLOYEE'S death shall be paid
to the EMPLOYEE'S estate. EMPLOYEE'S estate will not be entitled to
any other compensation upon termination of this AGREEMENT pursuant
to this Paragraph 8(a)
(b) If, during the EMPLOYMENT TERM, EMPLOYEE, because of physical or
mental illness or incapacity, shall become substantially unable to
perform the duties and services required of him under this AGREEMENT
for a period of three (3) consecutive months, the COMPANY may, upon
at least ten (10) days' prior written notice given at any time after
the expiration of such three (3) month period to EMPLOYEE of its
intention to do so, terminate this AGREEMENT as of such date as may
be set forth in the notice. In any case of such termination,
EMPLOYEE shall be entitled to receive his accrued SALARY and BONUS,
if any, reimbursable expenses and benefits owing to EMPLOYEE through
the date of termination. EMPLOYEE will not be entitled to any other
compensation upon termination of this AGREEMENT.
9. TERMINATION FOR CAUSE.
(a) The COMPANY may terminate the employment of EMPLOYEE for Cause (as
hereinafter defined) without prior notice. Upon any such
termination, the COMPANY shall be released from any and all further
obligations under this AGREEMENT, except that the COMPANY shall be
obligated to pay EMPLOYEE his SALARY, reimbursable expenses and
benefits owing to EMPLOYEE through the day on which EMPLOYEE is
terminated. EMPLOYEE will not be entitled to any other compensation
upon termination of this AGREEMENT pursuant to this Paragraph 9(a).
(b) As used herein, the term "Cause" shall mean: (i) the willful failure
of EMPLOYEE to perform his duties pursuant to Paragraph 3 hereof,
which failure is not cured by EMPLOYEE within ten (10) days
following notice thereof from the COMPANY; (ii) any other material
breach of this AGREEMENT by EMPLOYEE, including any of the material
representations or warranties made by EMPLOYEE; (iii) any act, or
failure to act by EMPLOYEE in bad faith or to the detriment or to
the detriment of the COMPANY; (iv) the commission by EMPLOYEE of an
act involving moral turpitude, dishonesty, theft, unethical business
conduct, or any other conduct which significantly impairs the
reputation of, or harms, the COMPANY, its subsidiaries or
affiliates; (v) any misrepresentation, concealment or omission by
EMPLOYEE of any material fact in seeking or continuing employment
hereunder, or (vi) any other occurrence or circumstance generally
recognized a "cause" for employment termination under applicable
law.
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10. DISCLOSURE OF INFORMATION AND RESTRICTIVE COVENANT. EMPLOYEE acknowledges
that, by his employment, he has been and will be in a confidential
relationship with the COMPANY and will have access to confidential
information and trade secrets of the COMPANY, its subsidiaries and
affiliates. Confidential information and trade secrets include, but are
not limited to, customer, supplier, and client lists, marketing,
distribution and sales strategies and procedures, operational and
equipment techniques, business plans and system, quality control
procedures and systems, special projects and technological research,
including projects, research and reports for any entity or client or any
project, research, report or the like concerning sales or manufacturing or
new technology, employee compensation plans and any other information
relating thereto, and any other records, files, drawings, inventions,
discoveries, applications, processes, data, and information concerning the
business of the COMPANY which are not in the public domain. EMPLOYEE
agrees that in consideration of the execution of this AGREEMENT by the
COMPANY:
(a) EMPLOYEE will not, during the term of this AGREEMENT or at any time
thereafter, use, or disclose to any third party, trade secrets or
confidential information of the COMPANY, including but not limited
to, confidential information or trade secrets belonging or relating
to the COMPANY, its subsidiaries, affiliates, customers and clients
or proprietary processes or procedures of the COMPANY, its
subsidiaries, affiliates, customers and clients. Proprietary
processes and procedures shall include, but shall not be limited to,
all information which is known or intended to be known only to
employees of the COMPANY, its respective subsidiaries and affiliates
or others in a confidential relationship with the COMPANY or its
respective subsidiaries and affiliates which relates to business
matters.
(b) EMPLOYEE will not, during the term of the AGREEMENT, directly or
indirectly, under any circumstance other than at the direction and
for the benefit of the COMPANY, engage in or participate in any
business activity, including, but not limit to, acting as a
director, franchisor or franchisee, proprietor, syndicate member,
shareholder or creditor or with a person having any other
relationship with any other business, company, firm occupation or
business activity, in any geographic area within the United States
that is, directly or indirectly, competitive with any business
completed by the COMPANY or any of its subsidiaries or affiliates
during the term of this AGREEMENT or thereafter. Should EMPLOYEE own
5% or less of the issued and outstanding shares of a class of
securities of a corporation the securities of which are traded on a
national securities exchange or in the over-the-counter market, such
ownership shall not cause EMPLOYEE to be deemed a shareholder under
this Paragraph 10 (b).
(c) EMPLOYEE will not, during the term of this AGREEMENT and for a
period of two (2) years thereafter on his behalf or on behalf of any
other business enterprise, directly or indirectly, under any
circumstance other than at the direction and for the benefit of the
COMPANY, solicit or induce any creditor, customer, supplier,
officer, employee or agent of the COMPANY or any of its subsidiaries
or affiliates to sever its relationship with or leave the employ of
any such entities.
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(d) This Paragraph 10 and Paragraphs 11, 12 and 13 hereof shall survive
the expiration or termination of this AGREEMENT for any reason.
(e) It is expressly agreed by EMPLOYEE that the nature and scope of each
of the provisions set forth above in this Paragraph 10 are
reasonable and necessary. If, for any reason, any aspect of the
above provisions as it applies to EMPLOYEE is determined by a court
of competent jurisdiction to be unreasonable, or unenforceable, the
provision shall only be modified to the minimum extent required to
make the provisions reasonable and/or enforceable, as the case may
be. EMPLOYEE acknowledges and agrees that his services are of a
unique character and expressly grants to the COMPANY or any
subsidiary, successor or assignee of the COMPANY, the right to
enforce the provisions above through the use of all remedies
available at law or in equity, including, but not limited to,
injunctive relief.
11. COMPANY PROPERTY.
(a) Any patents, inventions, discoveries, applications or process,
designs, devised, planned, applied, created, discovered or invented
by EMPLOYEE in the course of EMPLOYEE'S employment under this
AGREEMENT and which pertain to any aspect of the COMPANY'S or its
respective subsidiaries' or affiliates' business shall be the sole
and absolute property of the COMPANY, and EMPLOYEE shall make prompt
report thereof to the COMPANY and promptly execute any and all
documents reasonably requested to assure the COMPANY the full and
complete ownership thereof.
(b) All records, files, lists, including computer generated lists,
drawings, documents, equipment and similar items relating to the
COMPANY'S business which EMPLOYEE shall prepare or receive from the
COMPANY shall remain the COMPANY'S sole and exclusive property. Upon
termination of this AGREEMENT, EMPLOYEE shall promptly return to the
COMPANY all property of the COMPANY in his possession. EMPLOYEE
further represents that he will not copy or cause to be copied,
print out or cause to be printed out any software, documents or
other materials originating with or belonging to the COMPANY.
EMPLOYEE additionally represents that, upon termination of his
employment with the COMPANY, he will not retain in his possession
any such software, documents or other materials.
12. REMEDY. It is mutually understood and agreed that EMPLOYEE'S services are
special, unique, unusual, extraordinary and of an intellectual character
giving them a peculiar value, the loss of which cannot be reasonably or
adequately compensated in damages in an action at law. Accordingly, in the
event of any breach of this AGREEMENT by EMPLOYEE, including but not
limited to, the breach of the non-disclosure, non-solicitation and
non-compete clauses of Paragraph 10 hereof, the COMPANY shall be entitled
to equitable relief by way of injunction or otherwise in addition to
damages the COMPANY may be entitled to recover.
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13. REPRESENTATIONS AND WARRANTIES OF EMPLOYEE.
(a) In order to induce the COMPANY to enter into this AGREEMENT,
EMPLOYEE hereby represents and warrants to the COMPANY as follows:
(i) EMPLOYEE hereby has the legal capacity to unrestricted right to
execute and deliver this AGREEMENT and to perform all of his
obligations hereunder; (ii) the execution and delivery of this
AGREEMENT by EMPLOYEE and the performance of his obligations
hereunder will not will not violate or be in conflict with any
fiduciary or other duty, instrument, agreement, document,
arrangement or other understanding to which EMPLOYEE is a party or
by which he is or may be bound or subject; and (iii) EMPLOYEE is not
a party to any instrument, agreement, document, arrangement or other
understanding with any person (other than the COMPANY) requiring or
restricting the use or disclosure of any confidential information or
the provision of any employment, consulting or other services.
(b) EMPLOYEE hereby agrees to indemnify and hold harmless the COMPANY
from and against any and all losses, costs, damages and expenses
(including, without limitation, its reasonable attorneys' fees)
incurred or suffered by the COMPANY resulting from any breach by
EMPLOYEE of any of his representations or warranties set forth in
Paragraph 13(a) hereof.
14. NOTICES. All notices given hereunder shall be in writing and shall be
deemed effectively given when hand-delivered or mailed, if sent by
registered or certified mail, return receipt requested, addressed to
EMPLOYEE at his address set forth on the first page of this AGREEMENT or
to the COMPANY at its address set forth on the first page of this
AGREEMENT or to such changed address as may be properly noticed hereunder.
15. ENTIRE AGREEMENT. Other than any separate agreements which supplement and
are cumulative to paragraphs 10, 11 and 12 hereof, this AGREEMENT
constitutes the entire understanding of the parties with respect to its
subject matter and no change, alteration or modification hereof may be
made except in writing signed by the parties hereto. Any prior or other
agreements, promises, negotiations or representations not expressly set
forth in this AGREEMENT are of no force or effect.
16. SEVERABILITY. If any provision of this AGREEMENT shall be unenforceable
under any applicable law, then notwithstanding such unenforceability, the
remainder of this AGREEMENT shall continue in full force and effect.
17. WAIVERS, MODIFICATIONS, ETC. No amendment, modification or waiver of any
provision of this AGREEMENT shall be effective unless the same shall be in
writing and signed by each of the parties hereto, and then such waiver or
consent shall be effective only in the specific instance and for the
specific purpose for which given.
18. INDEMNIFICATION. COMPANY shall indemnify EMPLOYEE against any and all
claims of third parties arising out of the lawful and authorized
performance of his duties pursuant to this AGREEMENT by EMPLOYEE to the
fullest extent permitted by law.
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19. ASSIGNMENT. Neither this AGREEMENT, nor any of EMPLOYEE'S rights, powers,
duties or obligation hereunder, may be assigned by EMPLOYEE. This
AGREEMENT shall be binding upon and inure to the benefit of EMPLOYEE and
his heirs and legal representatives and the COMPANY and its successors and
assigns.
20. APPLICABLE LAW. This AGREEMENT shall be deemed to have been made, drafted,
negotiated and the transactions contemplated hereby consummated and fully
performed in the State of California, without regard to the conflicts of
law rules thereof. Nothing contained in this AGREEMENT shall be construed
so as to require the commission of any act contrary to law, and whenever
there is any conflict between any provision of this AGREEMENT and any
statue, law, ordinance, order or regulation, contrary to which the parties
hereto have no legal right to contract, the latter shall prevail, but in
such event any provision of this AGREEMENT so affected shall be curtailed
and limited only to the extent necessary to bring it within applicable
legal requirements.
21. ARBITRATION; JURISDICTION AND VENUE; PREVAILING PARTY It is hereby
irrevocably agreed that all disputes or controversies between COMPANY and
EMPLOYEE arising out of, in connection with or relating to this AGREEMENT
shall be exclusively heard, settled and determined by arbitration before a
retired Federal or California judge to be held in the City of Los Angeles,
County of Los Angeles. The arbitration shall be administered by JAMS
pursuant to its Comprehensive Arbitration Rules and Procedures. The
parties also agree that judgment may be entered on the arbitrator's award
by any court having jurisdiction thereof and the parties consent to the
jurisdiction of any court located in the City of Los Angeles, County of
Los Angeles, for this purpose. The arbitrator shall allocate all of the
costs of the arbitration, including the fees of the arbitrator and the
reasonable attorneys' fees and expenses of the prevailing party, against
the party who did not prevail.
22. FULL UNDERSTANDING. EMPLOYEE represents and agrees that he fully
understands his rights to discuss all aspects of this AGREEMENT with his
private attorney, that to the extent, if any, that he desires, he availed
himself of this right, that he has carefully read and fully understands
all of the provisions of this AGREEMENT, that he is competent to execute
this AGREEMENT, that his agreement to execute this AGREEMENT has not been
obtained by any duress and that he freely and voluntarily enters into it,
and that he has read this document in its entirety and fully understands
the meaning, intent and consequences of this document.
23. COUNTERPARTS. This AGREEMENT may be executed in any number of
counterparts, each of which shall be deemed an original and all of which
taken together shall constitute one and the same agreement.
24. LEGAL REPRESENTATION. The parties hereto acknowledge that each has been
represented by independent counsel of such party's own choice throughout
all of the negotiations which preceded the execution of this AGREEMENT and
in connection with the preparation and execution of this AGREEMENT or has
had the opportunity to do so and has not availed himself or itself of it.
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IN WITNESS WHEREOF, the parties have executed this AGREEMENT as of the date
first above written.
MOTORCAR PARTS & ACCESSORIES, INC.
By: /s/ Selwyn Joffe
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Name/Date: Selwyn Joffe
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Title: Chairman of the Board, President
and Chief Executive Officer
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/s/ Charles W. Yeagley
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CHARLES W. YEAGLEY/DATE
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