EMPLOYMENT AGREEMENT
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This
Employment
Agreement ("Agreement") is made as of the 15th day of
August, 2006 (the
"Commencement Date") by and among Mitchell Site Acq., Inc., a
Louisiana corporation
("Company")
and Matthew B. Mitchell (hereinafter, the
"Executive"). All
capitalized terms not otherwise defined herein shall have the
meaning given to them in that certain Stock Purchase Agreement,
dated as of June
20, 2006, by and among Company, Ayin Holding Company
Inc., and Sellers (the
"Stock Purchase
Agreement").
RECITALS
A.
Ayin
Holding Company Inc. acquired all of the issued and outstanding
stock of the Company on August 15, 2006.
B.
The
Board of Directors of the Company (the
"Board") recognizes the
Executive's potential contribution to the growth and success of the
Company, and
desires to
assure the Company of the Executive's employment in
an executive
capacity and
to compensate him therefore, has
approved the provisions of this
Agreement and
has authorized the officers of the Company to execute the
Agreement on
behalf of the Company.
C.
The
Executive is willing to make his services available to the
Company on
the terms and conditions hereinafter set forth.
AGREEMENT
NOW,
THEREFORE,
in consideration of
the premises and mutual covenants set
forth herein,
the parties agree as follows:
1.
Employment.
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1.1
Employment and Terms.
The Company hereby agrees to employ the
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Executive and the
Executive hereby agrees to serve the Company on the terms and
conditions set
forth herein.
1.2
Duties of Executive.
During the Term of Employment under this
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Agreement (as
hereinafter defined),
the Executive shall serve as the Company's
President. The
Executive shall be accountable to the Board, and, subject to
the
authority of
the Board, shall have supervision and control over, and
responsibility for
the overall operations of the Company. He also
shall have
such other
powers and duties as may from time to time be
prescribed by the
Board, provided that such duties are consistent with the
Executive's position as
President of
a company the size and type of the Company.
The Executive shall
devote the
necessary time and attention to the business and affairs of
the
Company, render such services to the best of his ability, and use
his reasonable
best efforts
to promote the interests of the Company, Notwithstanding
the
foregoing or any other
provision in this Agreement, it shall not be a breach or
violation of this Agreement for the Executive to (i) serve on
corporate (subject
to approval
of the Board), civic or charitable boards
or committees; or (ii)
manage personal
investments,
so long as such
<PAGE>
activities do not significantly interfere with or significantly
detract from the
performance of
the Executive's responsibilities to the Company in
accordance
with this agreement.
2.
Term. The term of employment under this Agreement (the "Term
of
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Employment") shall
commence as of Commencement Date and end on
April 30, 2009
("Initial Term"),
or such earlier date on which the
Executive's employment is
terminated pursuant
to Section 5 of this
Agreement, Upon the expiration of the
Initial Term,
if all parties hereto consent, the
Executive's employment under
this Agreement
may be renewed for a
successive three (3) year period ("Renewal
Term", and together
with the Initial Term, the "Term"). The date upon which the
Term expires
shall be referred to as the "Expiration Date." If the
Company
continues to
employ the Executive beyond the
Expiration Date without entering
into a written employment agreement
between the Company and the Executive, all
obligations and rights
under this Agreement shall prospectively lapse as of the
Expiration Date,
except the Company's
ongoing indemnification obligation under
Section 4 and the Executive's obligations under Sections 6 and 7.
3.
Place of Performance. The Executive shall be based in
Lafayette,
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Louisiana, except
for required travel on the Company's business.
4.
Compensation and
Related Matters.
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4.1
Base Salary.
The Executive shall
not be entitled to any base
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salary or base compensation.
4.2
Bonuses. During the Term of Employment, the Executive shall be
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entitled to
participate
in the bonus program described on EXHIBIT A, in
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accordance with
the terms and conditions set forth on EXHIBIT A.
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4.3
Automobile Allowance.
During the Term of Employment, the
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Executive shall
be entitled to a monthly automobile allowance of
$750.00.
4.4
Reimbursement of
Expenses. Upon the submission of proper
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substantiation by the Executive, and subject to such rules and
guidelines as the
Company may
from time to time adopt with respect to the reimbursement
of
expenses of
executive personnel,
the Company shall reimburse the Executive for
all reasonable and customary expenses actually paid or incurred by
the Executive
during the
Term of Employment in
the course of and pursuant to the business of
the Company.
The Executive shall account to the Company in writing for
all
expenses for
which reimbursement is sought and shall supply to the
Company
copies of all relevant invoices, receipts or other evidence
reasonably requested
by the Company.
4.5
Standard Benefits.
During the Term of Employment, the
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Executive shall
be entitled to participate in the Ayin Holding
Company Inc.
BlueCross BlueShield
Health Care Plan (the "Ayin Health
Plan"), in accordance
with the terms of that plan and applicable law,
<PAGE>
4.6
Stock Options.
During the Term of Employment, the
Executive
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shall be entitled to receive certain stock options, in accordance
with the terms
and conditions
set forth on EXHIBIT B.
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4.7
Indemnification. The Company shall extend to the Executive the
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same indemnification
arrangements as are
generally provided to other similarly
situated Company
executives, including after the termination of the Executive's
employment
hereunder.
4.8
Other Benefits.
The Executive shall be entitled to
four (4)
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weeks of paid vacation each calendar year
during the Term of Employment, to be
taken at such times as the Executive and the
Company shall mutually determine
and provided that no vacation time shall significantly interfere
with the duties
required to be rendered by the Executive hereunder, and further
provided that in
no event shall
Executive take more than two (2) successive weeks of vacation
at
any time.
5.
Termination.
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5.1
Termination for Cause. The Company shall at all times have the
----------------------
right, immediately
upon written notice to
the Executive, to terminate the Term
of Employment,
for Cause as defined
below. For purposes of this Agreement, the
term "Cause"
shall mean (i) an action or omission of the Executive
which
constitutes a willful
and material breach of, or a willful and material failure
or refusal (other than by reason of his disability or incapacity)
to perform his
duties under, this
Agreement and other than a breach of Section 7 hereof, which
is not cured within
fifteen (15) days after receipt by the Executive of written
notice of same, (ii) engaging in any action on behalf
of an enterprise which
competes or
plans to compete with the Company or any of its
subsidiaries or
affiliates, (iii)
fraud, embezzlement, misappropriation of funds or
material
breach of trust in connection with his services hereunder, (iv) an
indictment or
conviction of
any crime which
involves dishonesty or a breach of trust, or (v)
any breach
of Section 7 hereof. Any termination for Cause shall be
made in
writing by
notice to the
Executive, which notice shall set forth in reasonable
detail all
acts or omissions upon which the Company is relying for such
termination. The
Executive (and his
legal representative) shall have the right
to address the Board
regarding the acts set forth in the notice of termination.
Upon any termination
pursuant to this Section 5.1, the Company shall (i) pay to
the Executive
any accrued but unpaid
consideration due under the bonus program
for the preceding year described on EXHIBIT A, if
any, in accordance with the
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terms and condition set forth on EXHIBIT A, and (ii) pay to the
Executive
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accrued but
unpaid expense reimbursements and benefits, if any. Upon any
termination effected and compensated pursuant to this Section 5.1,
the Executive
shall forfeit,
for each complete month of the Initial Term remaining,
Executive's right
to receive 1/36th of
the aggregate unpaid amounts (including
principal and
interest) under the Notes delivered pursuant
to Section 2.07 of
the Stock Purchase Agreement and the
Goodwill Agreement (the "Notes"), and the
Company shall
have no further liability hereunder and thereunder.
<PAGE>
5.2
Disability. The
Company shall at all times have the right,
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upon written
notice to the Executive, to terminate the
Term of Employment, if
the Executive
shall as the result of
mental or physical incapacity, illness or
disability, become
unable to perform his
obligations hereunder for a period of
90 days in any 12-month period. The determination of whether the
Executive is or
continues to be disabled shall be made in writing by a physician
selected by the
Board and reasonably
acceptable to the Executive. Upon any termination pursuant
to this Section 5.2,
the Company shall (i) pay to the Executive any accrued but
unpaid consideration
due under the bonus program on a pro
rata basis measured
until the date of termination, in accordance
with the terms and conditions set
forth on EXHIBIT A and due only after the completion of the then
current
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Performance Year
as provided in EXHIBIT A. and (ii) pay any premiums for
a
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period of 18 months in connection with the temporary continuation of the
disability benefits
under the Ayin Health Plan in accordance with the terms and
conditions of
the Consolidated Omnibus Budget Reconciliation Act of 1986
("COBRA"), Upon
any termination effected and compensated pursuant to this
Section 5.2,
the Company shall have no further liability hereunder.
5.3
Death. Upon
the death of the Executive during the Term
of
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Employment, the
Company shall (i) pay to the estate of the
deceased Executive
any accrued
but unpaid
consideration due under the bonus program on a pro rata
basis measured
until the date of
termination, in accordance with the terms and
conditions set forth
on EXHIBIT A and due only after the completion of the then
---------
current Performance Year as provided in EXHIBIT A, and (ii) pay any
premiums for
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a period of 18 months in connection with the temporary
continuation of the
benefits accruing
to the deceased Executive's spouse and dependent
children
under the Ayin Health Plan in accordance with the terms and
conditions of COBRA,
if such persons had been qualified beneficiaries under the
Ayin Health Plan
prior to the Executive's death. Upon any
termination effected and compensated
pursuant to
this Section 5.3, the Company shall have no further
liability
hereunder.
5.4
Termination Without Cause. The Company shall have the right to
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terminate the Term of
Employment at any time by written notice to the Executive
not less than thirty
(30) days prior to the intended termination date. Upon any
termination pursuant to this Section 5.4 (that is not a termination
under any of
Sections 5.1,
5.2, 5.3 or 5,5), the Company shall (i)
pay to the Executive an
amount equal
to $375,000, payable in twelve (12) equal consecutive
monthly
installments of
$31,250, commencing on the date of
termination of Executive's
employment (the
"Severance
Payment").
The Severance Payment
shall be paid in
cash; and (ii) continue to provide the Executive with the benefits under
Sections 4.3
and 4.5 (the "Benefits") for a period of three (3) months
immediately following
the date of his termination in the manner and
at such
times as the Benefits
otherwise would have been provided to the Executive. Upon
any termination
effected and compensated pursuant to this Section 5.4, the
Company shall
have no further liability hereunder.
5.5
Termination by
Executive.
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<PAGE>
a.
Upon termination
of the Term of Employment pursuant to
this Section
5.5 by the Executive without Good
Reason (as defined below), the
Company shall (i) pay
to the Executive any accrued but unpaid consideration due
under the bonus program for the preceding
year described on EXHIBIT A, if any,
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in accordance with the
terms and condition set forth on EXHIBIT A, and (ii) pay
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to the Executive accrued but unpaid expense reimbursements and
benefits, if any.
Upon any termination
effected and compensated pursuant to this Section 5.1, the
Executive shall
forfeit, for each complete month of the Initial Term remaining,
Executive's right
to receive 1/36th of
the aggregate unpaid amounts (including
principal and
interest) under the
Notes, and the Company shall have no further
liability hereunder
and thereunder.
b.
Upon termination
of the Term of Employment pursuant to
this Section 5.5 by
the Executive for Good Reason, the Company shall pay to the
Executive the
same amounts, and
shall continue to provide Benefits in the same
amounts, that
would have been payable or provided by the Company to the
Executive under Section 5.4 of this Agreement if the Term of
Employment had been
terminated by
the Company without Cause.
c.
For purposes
of this Agreement,
"Good Reason" shall mean
the termination
of this Agreement by Executive not less than 60 days
notice
following: (i) the assignment to the Executive of any duties
inconsistent in any
respect with
the Executive's position (including status,
offices, titles and
reporting
requirements),
authority, duties or responsibilities as contemplated
by Section
1.2 of this Agreement, or any other action by the Company
which
results in a diminution in such position, authority, duties or
responsibilities;
(ii) any failure by
the Company to comply with any of the provisions of Article
4 of this Agreement, other than an isolated, insubstantial and
inadvertent
failure not occurring in bad faith and which is remedied by the
Company promptly
after receipt
of notice thereof given by the Executive; (iii) the
Company's
requiring the
Executive to be based at any office or location, that is
not
within 50 miles of the place of performance denoted under
Article 3 of this
Agreement, excluding
required travel on the Company's business; (iv) failure to
make payment under the
Notes where such payment is not prohibited by applicable
loan agreements
to which either Ayin Holding Company Inc. or
Charys Holding
Company, Inc.
("Charys")
is a party; or (v) the occurrence of a Change
in
Control. The
Company shall have the right to cure the
problem(s) noted by the
Executive, before
the Executive may terminate his
employment for Good Reason.
5.6
Termination upon
Change in Control.
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a.
Either the Company or the Executive may terminate
this
Agreement at
any time upon not less
than thirty (30) days prior written notice
to the other party given within six (6) months after
a Change in Control (as
hereinafter defined).
In such event, the Company shall pay to the Executive the
same amounts,
and shall continue to
provide Benefits in the same amounts, that
would have
been payable or provided by the Company to the Executive
under
Section 5.4
of this Agreement if
the Term of Employment had been terminated by
the Company
without Cause. In addition, if as a
<PAGE>
result of the Change in Control, the Executive would be
entitled to any cash
payments from
the Company, (other than those provided under this
Agreement)
under any plan or program maintained by the Company
("Additional Benefits"),
then the Company shall
provide the Executive with those Additional Benefits, if
and only to the extent
that such Additional Benefits, when added to the amounts
payable and
the Benefits provided by the Company to the
Executive hereunder,
will not constitute excess parachute
payments with the meaning of Section 280G
of Internal
Revenue Code of 1986, as amended, and the
regulations thereunder
(the "Code").
Upon any termination effected and
compensated pursuant to this
Section 5.6, the Company shall have no further liability hereunder
to Executive.
b.
For purposes
of this Agreement, the term "Change in
Control" shall
mean:
(i)
Consummation by
Charys of (x) a reorganization,
merger, consolidation
or other form of corporate transaction or series of
transactions, in
each case, with respect to which persons who were the
shareholders of
Charys immediately prior to such reorganization, merger or
consolidation or other transaction do not, immediately thereafter,
own more than
Fifty Percent
(50%) of the combined
voting power entitled to vote generally in
the election
of directors of the
reorganized, merged or consolidated company's
then outstanding
voting securities, in substantially the same
proportions as
their ownership
immediately prior to such reorganization, merger, consolidation
or other transaction, or (y) a liquidation
or dissolution of Charys or (z) the
sale of all or substantially all of the assets of Charys (unless such
reorganization,
merger, consolidation
or other corporate transaction,
liquidation,
dissolution or
sale is subsequently abandoned);
(ii)
the acquisition
(other than from Charys) by any
person, entity or "group", within the meaning of Section 13(d)(3)
or 14(d)(2) of
the Securities
Exchange Act, of beneficial ownership within the meaning of
Rule
13-d promulgated
under the Securities Exchange Act of
more than Fifty Percent
(50%) of either the then outstanding shares of Charys's
Common Stock or the
combined voting power of Charys's then outstanding voting
securities entitled to
vote generally
in the election of directors (hereinafter referred
to as the
ownership of
a "Controlling Interest") excluding, for this purpose, any
acquisitions by
(1) Charys or its Subsidiaries, (2) any person, entity or
"group" that
as of the Commencement Date of this Agreement owns
beneficial
ownership (within
the meaning of Rule 13d-3 promulgated under
the Securities
Exchange Act)
of a Controlling Interest or (3) any employee
benefit plan of
Charys or its Subsidiaries;
(iii)
provided that,
with respect to this Section
5.6(b), a Change in Control shall not be
deemed to have occurred should any of
the contingencies
referred to in this Section involve (i) any of those
companies, persons or other legal entities with whom Charys is
negotiating on or
before the
Commencement Date and
which are communicated, in writing, by Charys
to the Executive upon or prior to execution of this
Agreement; or (ii) as a
result of any internal corporate reorganization or
<PAGE>
reclassification of
voting securities among Charys' existing shareholders
resulting in
reallocation
of voting interests among such persons.
5.7
Resignation. Upon
any termination of employment pursuant
to
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this Article
5, the Executive shall be deemed to
have resigned as an officer,
and if he or she was then serving as a
director of the Company, as a director,
and if required by the Board, the Executive hereby agrees to
immediately execute
a resignation
letter to the Board.
5.8
Survival. The
provisions of this
Article 5 shall survive the
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termination of
this Agreement, as applicable.
6.
Non-Competition. In order to fully protect the Company's
proprietary
----------------
information, and in
connection with the valuable cons
