Exhibit 10.3
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as of the
29th day of January, 1999, by and between M.R.B., INC., a Georgia corporation
(the "Company"), and M. REA BROOKINGS (the "Employee").
R E C I T A L S
The Company desires to obtain the services of the Employee in the employment of
the Company on the terms and subject to the conditions set forth in this
Agreement, and the Employee desires to make her services available to the
Company on the terms and subject to the conditions set forth in this Agreement.
A G R E E M E N T
NOW, THEREFORE, in consideration of the premises, agreements and mutual
covenants set forth herein, the parties hereto, intending to be bound legally,
hereby agree as follows:
1. DEFINITIONS. The following terms when used herein, unless the context
otherwise requires, shall be defined as follows:
1.1. "Cause" shall have the meaning set forth in Section 5.1 hereof.
1.2. "CAM" shall mean Chancellor Asset Management, Inc., a Delaware
corporation and parent company of the Company.
1.3. "Chancellor" shall mean Chancellor Corporation, a Massachusetts
corporation and parent company of CAM.
1.4. "Companies" shall mean the Company, together with Tomahawk Truck and
Trailer Sales, Inc., a Florida corporation, Tomahawk Truck and Trailer Sales of
Virginia, Inc., a Virginia corporation, and Tomahawk Truck and Trailer Sales of
Missouri, Inc, a Missouri corporation.
1.5. "Company" shall mean M.R.B. Inc., a Georgia corporation.
1.6. "Confidential Information" shall have the meaning set forth in Section
7.1 hereof.
1.7. "Term" shall have the meaning set forth in Section 3 hereof.
1.8. "Stock Purchase Agreement" shall mean the Stock Purchase Agreement
entered into among CAM, David F. Herring, and the Employee dated as of the 29th
day of January, 1999.
2. EMPLOYMENT.
2.1. General. The Company hereby agrees to employ the Employee as President
of the Company during the Term on the terms and subject to the conditions
contained in
this Agreement, and the Employee hereby agrees to accept such employment on the
terms and subject to the conditions contained in this Agreement.
2.2. Duties of Employee. During the Term, the Employee shall diligently
perform all duties and responsibilities as may be assigned to her by the
Company's Board of Directors, and shall exercise such power and authority as may
from time to time be delegated to her thereby. The Employee shall devote her
full business time and attention to the business and affairs of the Companies as
necessary to perform her duties and responsibilities hereunder, render such
services to the best of her ability, and use her best efforts to promote at all
times the interests of the Companies.
3. TERM. Subject to the provisions of Section 5 of this Agreement, the
Company shall employ the Employee for a term of five (5) years (the "Term")
commencing as of the date first written above (the "Effective Date).
4. COMPENSATION.
4.1. Salary. The Employee shall receive an annual salary of Two Hundred
Thousand Dollars ($200,000.00) during the Term, and such salary shall be payable
in equal installments consistent with the Company's normal payroll schedule
commencing on either the first or fifteenth day of the month, as the case may
be, following the Effective Date. The Employee's annual salary shall be subject
to such increases as shall be approved by the Company's Board of Directors in
its sole discretion.
4.2. Benefits. During the Term, the Employee shall be entitled to
participate in all plans adopted for the general benefit of the Company's
employees, such as stock option plans, 401(k) plans, pension plans, profit
sharing plans, medical plans, group or other insurance plans and benefits, to
the extent that the Employee is and remains eligible to participate therein and
subject to the eligibility provisions of such plans in effect from time to time.
For each calendar year during the Term, the Employee shall be entitled to four
(4) weeks of paid vacation at such times as shall be mutually acceptable to the
Employee and the Company, and to sick and holiday time as prescribed by the
established Chancellor policies in effect from time to time.
4.3. Withholding. Notwithstanding any provision in this Agreement to the
contrary, all payments required to be made by the Company hereunder to the
Employee in connection with the Employee's employment hereunder shall be subject
to withholding of such amounts relating to taxes as the Company may reasonably
determine it should withhold pursuant to any applicable law or regulation. In
lieu of withholding such amounts, in whole or in part, the Company may, in its
sole discretion, accept other provisions for the payment of taxes, provided that
the Company is satisfied that all requirements of law affecting its
responsibilities to withhold have been satisfied.
4.4. Reimbursement of Expenses. The Company agrees to reimburse the
Employee for all reasonable business expenses (including, without limitation,
reasonable travel and entertainment expenses) incurred by the Employee in the
discharge of her duties hereunder, subject to the Company's reimbursement
policies in effect from time to time. The Employee agrees to maintain reasonable
records of her business expenses in such form and detail as the Company may
request and to make such records available to the Company as and when requested.
5. TERMINATION.
5.1. Termination by the Company for Cause. Notwithstanding any provision in
this Agreement to the contrary, this Agreement may be terminated by the Company
for "Cause" at any time during the Term hereof, and such termination shall be
effective immediately upon written notice to the Employee. For purposes of this
Agreement, "Cause" for the termination of the Employee's employment hereunder
shall be deemed to exist only if, in the reasonable judgment of the Company's
Board of Directors: (a) the Employee commits fraud, theft or embezzlement
against any of the Companies; (b) the Employee commits a felony or a crime
involving moral turpitude; (c) the Employee discloses trade secrets or other
proprietary information of Chancellor or any of the Companies or any subsidiary
or affiliate thereof to any unauthorized person or entity; (d) the Employee
breaches any non-competition or non-solicitation agreement with Chancellor or
any of the Companies or any subsidiary or affiliate thereof; (e) the Employee
breaches any of the terms of this Agreement (other than those referenced in
clauses (c) and (d) of this Section 5.1) and fails to cure such breach within
twenty (20) days after the receipt of written notice of such breach from the
Company; or (f) the Employee engages in gross negligence or willful misconduct
that causes harm (or could reasonably be expected to cause harm) to the business
and operations of Chancellor or any of the Companies or a subsidiary or
affiliate thereof. Upon any termination pursuant to this Section 5.1, the
Employee shall be entitled to be paid solely the Employee's salary then in
effect through the effective date of termination, and the Company shall have no
further liability or other obligation of any kind whatsoever to the Employee
hereunder.
5.2. Termination by the Company Without Cause. The Company may, in its sole
and absolute discretion, terminate the employment of the Employee hereunder at
any time without "Cause" (as such term is defined in Section 5.1 above), or
otherwise without any cause, reason or justification, provided that the Company
provides to the Employee at least ninety (90) days' prior written notice (the
"Termination Notice") of such termination. In the event of any such termination
by the Company, (a) the Employee's employment with the Company shall cease and
terminate on the date specified in the Termination Notice (or, if no date is so
specified, on the date which is ninety (90) days following the date of such
notice), and (b) the Employee shall be entitled to receive and be paid (i) in
the case of a termination under this Section 5.2 at any time prior to or on the
third anniversary of the Effective Date, the Employee's entire salary, at the
rate in effect as of the effective date of such termination and in equal monthly
installments, through such third anniversary, and thereafter fifty percent (50%)
of the Employee's salary, at the rate in effect as of the effective date of such
termination and in equal monthly installments, during the then remaining Term,
and (ii) in the case of termination under this Section 5.2 at any time after the
third anniversary of the Effective Date, fifty percent (50%) of the Employee's
salary, at the rate in effect as of the effective date of such termination and
in equal monthly installments, during the then remaining Term, payable in either
of the cases set forth in clauses (i) and (ii) over the applicable period at the
Company's regular and customary intervals for the payment of salaries as then in
effect and in equal monthly installments, and the Company shall have no further
liability or other obligation of any kind whatsoever to the Employee hereunder.
5.3. Death of the Employee. In the event that the Employee shall die during
the Term, the Employee's employment with the Company shall immediately cease and
terminate and the Employee's estate, heirs (at law), devisees, legatees or other
proper and legally entitled descendants, or the personal representative,
executor, administrator or other proper legal representative on behalf of such
descendants, shall be entitled to receive and be paid solely the Employee's
salary through the date of death, and the Company shall have no further
liability or other obligation of any kind whatsoever to the Employee hereunder.
5.4. Disability of the Employee. In the event that the Employee becomes
incapacitated during the Term by reason of sickness, accident or other mental or
physical disability such that she is substantially unable to perform her duties
and responsibilities hereunder for a period of ninety (90) consecutive days, or
for shorter or intermittent periods aggregating one hundred twenty (120) days
during any 12-month period (a "Disability"), the Company thereafter shall have
the right, in its sole and absolute discretion, to terminate the Employee's
employment under this Agreement by sending written notice of such termination to
the Employee or her legal guardian or other proper legal representative and
thereupon her employment hereunder shall immediately cease and terminate;
provided, however, that notwithstanding the foregoing, the Employee's employment
shall not be terminated as aforesaid if the Company's Board of Directors
determines, in its reasonable judgment, that after the termination of such
Disability, the Employee is able to resume her duties and responsibilities to
the Company in accordance with the terms hereof in the manner theretofore
provided. In the event of any such termination, the Employee shall be entitled
to receive and be paid solely the Employee's salary then in effect through the
effective date of termination, and the Company shall have no further liability
or other obligation of any kind whatsoever to the Employee hereunder.
5.5. Termination by the Employee. Provided that the Company does not have
"Cause" to terminate the Employee pursuant to Section 5.1 above, the Employee
may terminate the Employee's employment with the Company hereunder at any time
and for any reason. Employee must provide to the Company written notice of such
termination not less than ninety (90) days prior to the date such termination is
to be effective. Upon any termination pursuant to this Section 5.5, the Employee
shall be entitled to be paid solely the Employee's salary then in effect through
the effective date of termination, and the Company shall have no further
liability or other obligation of any kind whatsoever to the Employee hereunder.
6. AGREEMENT NOT TO COMPETE. In addition to the separate non-competition
covenants made by the Employee as a "Seller" in Section 10.2 of the Stock
Purchase Agreement, which non-competition covenants the Employee agrees and
acknowledges are being given in consideration of the acquisition by CAM of the
outstanding capital stock of the Companies, and are fully and independently
enforceable in accordance with their terms, the Employee agrees that in the
event that the Employee's employment with the Company is terminated either (a)
at the expiration of the full five (5) year Term, or (b) at any time during the
fifth year of the Term (the actual effective date of such employment termination
being referred to herein as the "Termination Date"), the Employee shall not, for
an additional one (1) year period commencing as of the Termination Date, without
the prior written consent of the Company, (a) engage anywhere in the United
States, directly or indirectly, alone or as a shareholder (other than as a
holder of less than 3% of the capital stock of any publicly traded
7. corporation), member, partner, manager, officer, director, employee or
consultant, in any business that is engaged or becomes engaged in the business
of any of the Companies as existing on the Effective Date, (b) divert or attempt
to divert to any competitor of any of the Companies or any Affiliate of any such
competitor, any customer or client, or prospective customer or client, of any of
the Companies, or (c) solicit or encourage, or attempt to solicit or encourage,
any employee of any of the Companies to leave its employ for employment by or
with either Employee or Employee's Affiliates, or any competitor of any of the
Companies or any of any such competitor's Affiliates. If at any time the
provisions of this Section 6 shall be determined to be invalid or unenforceable,
by reason of being vague or unreasonable as to area, duration or scope of
activity, this Section 6 shall be considered divisible and shall become and be
immediately amended to only such area, duration and scope of activity as shall
be determined to be reasonable and enforceable by the court or other body having
jurisdiction over the matter; and the Employee agrees that this Section 6 as so
amended shall be valid and binding as though any invalid or unenforceable
provisions had not been included therein. Notwithstanding anything to the
contrary set forth in this Section 6, in the event that the non-competition
covenants of the Employee set forth in Section 10.2 of the Stock Purchase
Agreement terminate in accordance with the last sentence thereof, then the
non-competition covenants set forth in this Section 6 shall also terminate as to
the Employee as of the date such non-competition covenants set forth in the
Stock Purchase Agreement so terminate.
8. OWNERSHIP AND NON-DISCLOSURE AND NON-USE OF CONFIDENTIAL INFORMATION.
8.1. As used in this Agreement, "Confidential Information" shall mean all
customer sales and marketing information, customer account records, proprietary
receipts and/or processing techniques, information regarding vendors and
products, training and operations memoranda and similar information, personnel
records, pricing information, financial information and trade secrets concerning
or relating to the business, accounts, customers, employees and affairs of the
Companies, or any subsidiary or affiliate thereof, obtained by or furnished,
disclosed or disseminated to the Employee, or obtained, assembled or compiled by
the Employee or under her supervision during the course of her employment by the
Company, and all physical embodiments of the foregoing, all of which are hereby
agreed to be the property of and confidential to the Companies, but Confidential
Information shall not include any of the foregoing to the extent the same is or
becomes publicly known through no fault or breach of this Agreement by the
Employee.
8.2. The Employee acknowledges and agrees that all Confidential Information,
and all physical embodiments thereof, are confidential to and shall be and
remain the sole and exclusive property of the Companies. Upon request by any of
the Companies, and in any event upon termination of the Employee's employment
with the Company for any reason whatsoever, as a prior condition to the
Employee's receipt of any final salary or benefit payments hereunder, the
Employee shall deliver to the Companies all property belonging to the Companies
or any of its subsidiaries or affiliates, including, without limitation, all
Confidential Information (and all embodiments thereof), then in her custody,
control or possession, but any forfeiture of such salary or benefit shall not be
considered a satisfaction or a release of or liquidated damages for any claim(s)
for damages against the Employee which may accrue to the Companies, as a result
of any breach of this Section 7 by the Employee.
8.3. The Employee agrees that she will not, either during the Term or at any
time thereafter, without the prior written consent of the Company, use, disclose
or make available any Confidential Information to any person or entity, nor
shall she use, disclose, make available or cause to be used, disclosed or made
available, or permit or allow, either on her own behalf or on behalf of others,
any use or disclosure of such Confidential Information other than in the proper
performance of the Employee's duties hereunder. Notwithstanding anything to the
contrary set forth herein, after the expiration of the longer of (a) the
non-competition period applicable to the Employee set forth in the Stock
Purchase Agreement, and (b) the non-competition period set forth herein, the
Employee shall be permitted to utilize the customer lists of the Companies for
any purpose whatsoever.
8.4. Notwithstanding anything to the contrary set forth in this Section 7,
in the event the non-competition covenants of the Employee set forth in Section
10.2 of the Stock Purchase Agreement terminate in accordance with the last
sentence thereof, then the provision of this Section 7 shall also terminate as
to the Employee as of the date such non-competition covenants set forth in the
Stock Purchase Agreement so terminate.
9. INVENTIONS. The Employee shall disclose promptly to the Companies any
and all conceptions and ideas for inventions, improvements, business methods and
systems, and valuable discoveries, whether patentable or not, that are conceived
or made by the Employee, solely or jointly with another, during the Term and
that are directly related to the business or activities of the Companies and
that the Employee conceives as a result of her employment by the Company,
regardless of whether or not such ideas, inventions, or improvements qualify as
"works for hire." The Employee hereby assigns and agrees to assign all her
interests therein to the Companies or their nominees. Whenever requested to do
so by any of the Companies, the Employee shall execute any and all applications,
assignments or other instruments that such Company shall deem necessary to apply
for and obtain Letters Patent of the United States or any foreign country or to
otherwise protect any of the Companies' interest therein.
10. REASONABLENESS OF RESTRICTIONS. In the event that any provision
relating to time period or geographic area of any restriction set forth in
Sections 6, 7 or 8 shall be declared by a court of competent jurisdiction to
exceed the maximum time period or area of restriction that the court deems
reasonable and enforceable, the time period or area of restriction which the
court finds to be reasonable and enforceable shall be deemed to become, and
thereafter shall be, the maximum time period or geographic area of such
restriction.
11. ENFORCEABILITY. Any provision of Sections 6, 7 or 8 which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, but shall be enforced to the
maximum extent permitted by law, and any such prohibition or unenforceability in
any jurisdiction shall not invalidate or render unenforceable such provision in
any other jurisdiction.
12. INJUNCTION. It is recognized and hereby acknowledged by the parties
hereto that a breach or threat of breach by the Employee of any of the covenants
contained in Sections 6, 7 or 8 of this Agreement will cause irreparable harm
and damage to the Companies, the monetary amount of which may be virtually
impossible to ascertain. As a result, the Employee recognizes and hereby
acknowledges that the Companies shall be entitled to an injunction
from any court of competent jurisdiction enjoining and restraining any violation
or threatened violation of any or all of the covenants contained in Sections 6,
7 or 8 of this Agreement by the Employee or any of her affiliates, associates,
partners or agents, either directly or indirectly, and that such right to
injunction shall be cumulative and in addition to whatever other remedies the
Companies may possess.
13. ASSIGNMENT; BINDING EFFECT. The Employee shall not assign any of her
rights or obligations pursuant to this Agreement to any other person without the
prior written consent of the Company, which consent may be unreasonably withheld
or delayed. Subject to the foregoing, this Agreement shall be for the benefit
of and binding upon the parties hereto and their respective heirs, personal
representatives, legal representatives, successors and assigns.
14. EMPLOYER'S AUTHORITY. The relationship between the parties hereto is
that of employer and employee. The Employee agrees to observe and comply with
the rules and regulations of the Companies, as adopted by the Companies from
time to time with respect to the performance of the duties of the Employee. The
Employee acknowledges that she has no authority to enter into any contracts or
other obligations that are binding upon any of the Companies unless such
contracts or obligations are authorized by the Board of Directors of such
Companies. The Company shall have the power to direct, control and supervise the
duties to be performed by the Employee, the manner of performing said duties,
and the time of performing said duties.
15. GOVERNING LAW. This Agreement, the rights and obligations of the
parties hereto, and any claims or disputes relating thereto, shall be governed
by and construed in accordance with the laws of the State of Delaware, excluding
the choice of law rules thereof.
16. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties hereto with respect to the subject matter hereof and
supersedes all prior agreements, understandings and arrangements, both oral and
written, between the parties hereto with respect to such subject matter. This
Agreement may not be modified or amended in any way, unless by a written
instrument signed by both the Company and the Employee.
17. NOTICES. Any notice required or permitted to be given under this
Agreement shall be in writing and shall be deemed to have been given upon
receipt or actual delivery by hand or after sent by certified United States
mail, return receipt requested, postage prepaid, or by a reputable overnight
courier service, addressed as follows:
i) If to the Employee:
M. Rea Brookings
4382 S. Moreland Ave.
Conley, GA 30288
Fax: 404-362-9460
with a copy given in the manner prescribed above to:
Frank L. Wilson, III, Esq.
Wilson Brock & Irby, L.L.C.
Overlook I, Suite 700
2849 Paces Ferry Rd., N.W.
Atlanta, GA 30339
Fax: 404-853-1812
ii) If to the Company:
c/o Peter J. Mullen, Clerk
Chancellor Corporation
210 South Street
10th Floor
Boston, MA 02111
Fax: 617-422-5851
with a copy given in the manner prescribed above to:
Victor J. Paci, Esq.
Bingham Dana LLP
150 Federal Street
Boston, MA 02110
Fax: 617-951-8736
or to such other addresses as either party hereto may from time to time
give notice of to the other party hereto in the aforesaid manner.
17. DAMAGES. Nothing contained herein shall be construed to prevent any of
the Companies or the Employee from seeking and recovering from the other damages
sustained by either or both of them as a result of its or her breach of any term
or provision of this Agreement. In the event that either party hereto brings
suit for the collection of any damages resulting from, or the injunction of any
action constituting, a breach of any of the terms or provisions of this
Agreement, then the non-prevailing party shall pay all reasonable court costs
and attorneys' fees of the other party.
18. SECTION HEADINGS. The section headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
19. NO THIRD PARTY BENEFICIARY. Nothing expressed or implied in this
Agreement is intended, or shall be construed, to confer upon or give any person
or entity other than the parties hereto and their respective heirs, personal
representative, legal representative, successors and assigns, and except for the
other Companies (other than the Company), any rights or remedies under or by
reason of this Agreement.
20. WAIVER. No delay or failure at any time on the part of any of the
Companies in exercising any right, power or privilege under this Agreement, or
in enforcing any provision of this Agreement, shall impair any such right, power
or privilege, or be construed as a waiver of any default or as any acquiescence
therein, or shall affect the right of any of the Companies thereafter to enforce
each and every provision of this Agreement in accordance with its terms. The
waiver by either party hereto of a breach or violation of any term or provision
of this Agreement shall neither operate nor be construed as a waiver of any
subsequent breach or violation.
IN WITNESS WHEREOF, the undersigned have executed this Agreement under seal as
of the date first above written.
M.R.B., INC.
By: /s/ Franklyn E. Churchill
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Name: Franklyn E. Churchill
Title: CEO and President, Chancellor Asset Management, Inc.
EMPLOYEE
By: /s/ M. Rea Brookings
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Name: M. Rea Brookings