This CONSULTING AGREEMENT (this “ Agreement ”) is made and entered into as of July 31, 2009 (the “ Effective Date ”), by and between Richard K. McClelland (“ McClelland ”) and Dynamex Inc., a Delaware corporation (the “ Company ”).
WHEREAS, McClelland has previously served as the Company’s chief executive officer pursuant to that certain July 23, 2003 Amended and Restated Employment Agreement between the parties (the “Employment Agreement”); and
WHEREAS, McClelland has resigned as the Company’s chief executive officer but continues to serve the Company as its non-executive Chairman of the Board of Directors; and
WHEREAS, the Company and McClelland desire to enter into this Agreement to supersede and replace the Employment Agreement and more accurately reflect McClelland’s continuing role on behalf of the Company.
In consideration of the terms, conditions, covenants, representations, warranties and promises contained in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:
1. Engagement . The Company hereby engages McClelland, and McClelland accepts such engagement, upon the terms and conditions set forth herein, for the period beginning on Effective Date and ending as provided in Section 2 .
2. Term . The period of McClelland’s engagement by the Company under this Agreement shall commence on the Effective Date and shall continue, unless sooner terminated in accordance with the provisions of this Agreement, for an initial period of one year from the Effective Date; provided, however, that either party may terminate or amend the provisions of Paragraph 3 hereof, with at least 90 days prior written notice to the other. If neither party has given notice of termination at the end of the first yearly anniversary of this Agreement, the Term hereof shall continue thereafter on a month to month basis.
3. Position and Duties . During the term of this Agreement, McClelland shall serve as the non-executive Chairman of the Board of Directors (as constituted from time to time, the “ Board ”). In addition to those duties specified in the Company’s bylaws to be carried out by the Company’s Chairman, McClelland shall consult with the Board regarding the strategic direction of the Company, with additional focus on the Company’s acquisition and franchising programs. As Chairman of the Board, McClelland will coordinate with the Company’s Chief Executive Officer regarding the agenda for each meeting of the Board of Directors and shall preside at such meetings. The Company will continue to nominate McClelland each year during the term of this Agreement (or any extension thereof) for election to the Board. It is anticipated that McClelland will devote a material portion of his business time (estimated at 15% to 25%) in fulfilling his consulting activities for the Company. Any notice of termination or amendment under Section
2, shall specify whether such notice is effective for McClelland’s service as Chairman of the Board of Directors, his additional consulting duties referenced above, or both.
4. Compensation and Benefits .
(a) Base Salary . The Company shall pay McClelland a base fee (“ Base Fee ”) at an annual rate of US$100,000 per year, which may be adjusted in the reasonable good faith judgment of the Board or its compensation committee (the “ Compensation Committee ”) based on the scope of McClelland’s duties. McClelland’s Base Fee shall be paid in equal installments that are in no event less frequently than monthly.
(b) Expenses . The Company shall promptly reimburse McClelland for all reasonable business expenses upon reasonable substantiation and documentation in accordance with the Company’s policies and procedures in effect from time to time.
(c) Benefit Plans . During the term of this Agreement, McClelland shall be entitled to participate in and to receive benefits under such of the Company’s employee benefit plans, programs and arrangements that are available to senior executive officers of the Company, as the Compensation Committee deems appropriate, subject to the eligibility criteria and other terms and conditions thereof. For such purposes, the Company acknowledges that, as the Company’s Chairman of the Board, McClelland is deemed to be an employee of the Company.
(d) Stock Option Grant . On the date of this Agreement, the Company shall grant to McClelland a non-qualified stock option to purchase 10,000 shares of the Company’s common stock. The option will expire on the tenth anniversary of the date of grant, and the exercise price will be the average closing price of the Company’s common stock for the five day period beginning on the third business day following the date of this Agreement. The option will vest in quarterly installments over the two-year non-competition period described in Section 5(c) below. This Agreement does not affect or modify any of McClelland stock options which were granted prior to the date hereof.
(e) Miscellaneous . McClelland shall continue to have use of his business cell phone, laptop and email address during the Consulting Period.
5. Obligations of McClelland and the Company .
(a) Non-Disparagement . At all times during the term of this Agreement and following the Effective Date, neither party hereto nor any of such parties’ respective controlled affiliates shall make or solicit or encourage others to make or solicit directly or indirectly any derogatory or negative statement or communication about the other party and, in the case of McClelland, any of the Company’s affiliates or any of the Company’s and such affiliates’ respective businesses, products, services or activities; provided , however , that such restriction shall not prohibit truthful testimony compelled by valid legal process. Notwithstanding anything herein to the contrary, nothing in this Section 5(a) shall prevent any party hereto from exercising such party’s authority or enforcing such party’s rights or remedies hereunder or that such party may otherwise be entitled to enforce or assert under any other agreement or applicable law, or limit such rights or remedies in any way.
(b) Confidential Information . McClelland acknowledges and agrees that, as a result of his association with the Company he has developed and may further develop, obtain, or learn about Confidential Information, and the success of the Company and its affiliates depends upon the use and protection of such information. For purposes of this Agreement, “ Confidential Information ” means any proprietary information, trade secrets, inventions (whether or not patentable or reduced to practice) and all other intellectual property and confidential or proprietary information in any form or medium (whether merely remembered or embodied in a tangible or intangible form or medium) whether now or hereafter existing, relating to or arising from the past, current or potential business, activities and/or operations of the Company or any of its affiliates. Notwithstanding the foregoing, “ Confidential Information ” shall not include such portions of any information that (A) are or become generally known to and available for use by the public other than as a result of any act or omission by McClelland or otherwise as a result of McClelland’s breach of any provision of this Agreement or (B) are or become known to McClelland on a non-confidential basis other than (1) in connection with McClelland’s a