Sample Business Contracts

Employment Agreement - Engineered Support Systems Inc. and Gary C. Gerhardt

Employment Forms

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  • Consulting Agreement. Answer simple questions to build a contract with a consultant. Specify the services rendered, when payment is due, as well as IP rights.
  • Commission Agreement. Employers who compensate their sales employees based on commissions can prepare an agreement to reduce misunderstandings by specifying the base salary and how commissions are calculated.
  • Executive Employment Agreement. Companies may offer their business executives a contract that is different from the one provided to their regular employees. Executive employment agreements may be more complex because the compensation structure may include a combination of salary and commissions, provide for bonuses based on sales, stock or other financial targets, and include non-compete, confidentiality and severance provisions.
  • Sales Representative Contract. Independent sales representatives offer companies the potential to increase the sale of products or services without the burden of increasing headcount. Both parties should understand how commissions are calculated, when commissions will be paid, as well as how the representative will treat confidential information from the company and whether the representative may also sell a competing line of products or services.
  • More Employment Agreements

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                                GARY C. GERHARDT

                              EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT AGREEMENT is made and entered into as of the 1st day of
October 1999 by and between ENGINEERED SUPPORT SYSTEMS, INC., a Missouri
corporation (hereinafter called "Employer"), and GARY C. GERHARDT (hereinafter
called "Employee").

         WHEREAS, Employee desires to be employed by Employer and Employer
desires to employ Employee under the terms and conditions set forth in this
Agreement; and

         WHEREAS, it is Employer's intention to employ Employee upon the terms
and conditions herein, which recognize and compensate Employee for the
obligations of Employee undertaken hereunder, including specifically, but not by
way of limitation, the agreement of Employee not to compete with the business of
Employer, as provided in paragraph 8, for the period provided in paragraph 8
upon the cessation of Employee's employment by Employer for any reason.

         NOW, THEREFORE, in consideration of the foregoing and the promises and
agreements herein contained, the parties agree as follows:

         1. Employment. Employer hereby employs Employee in the capacity of Vice
Chairman of Administration, Chief Financial Officer, Executive Vice President
and Assistant Secretary and Employee hereby accepts such employment from
Employer upon the terms and conditions hereinafter set forth. This Agreement
replaces any and all other employment agreements by and between Employee and
Employer dated prior to the date of this Employment Agreement.

         2. Term of Employment. The term of Employee's employment under this
Agreement shall be for the period commencing as of, October 1, 1999 and
continuing through September 30, 2002, and thereafter continuing from year to
year unless terminated by either party at any time during any such further term
upon the giving of thirty (30) days notice of termination and/or termination
pay, or upon the earlier occurrence of any of the following events:

         (a) Upon the death of Employee.

         (b) At Employee's option upon ninety (90) days written notice.

         (c) In the event of Employee's Disability (defined as the failure
substantially to discharge Employee's duties under this Agreement for ninety
(90) consecutive days or one hundred twenty (120) days in any calendar year,
whether or not consecutive, as a result of an injury, disease, sickness or other
physical or mental incapacity). A determination of Employee's Disability shall
be made by a qualified licensed physician chosen by the Employer subject to
Employee's approval, which approval shall not be unreasonably withheld. In the
event Employer and Employee cannot agree on the choice of a physician, then such
physician shall be chosen by the dean of the St. Louis University School of
Medicine, St. Louis, Missouri, or if said dean is unwilling or unable to do so,
by the dean of another medical school of recognized national repute. The cost of
such determination shall be borne by Employer, and in the absence of fraud or
bad faith, shall be binding on all parties hereto. Upon termination for any of
the foregoing causes, Employee shall be entitled to receive only the
compensation accrued and unpaid as of the date of termination and shall not be
entitled to additional compensation or other consideration except as otherwise
expressly provided in this Agreement, or such other compensation plans in effect
in which Employee is a participant at the time of termination.

         (d) For cause upon seven (7) days written notice. For purposes of this
Agreement, "cause" shall mean the default in Employee's faithful performance of
the terms and conditions of this Agreement and such failure or such other action
which materially and adversely affects or is materially detrimental to the
operation of Employer's business as determined by Employer's Board of Directors.


         3. Duties of Employee. During Employee's employment by Employer,
Employee shall serve Employer to the best of Employee's ability and shall
perform such duties and in such capacities as are assigned to Employee from time
to time by the Chairman of the Board of Directors of the Employer. Employee
agrees during such period to devote substantial time and efforts to the business
of Employer, and to be loyal and faithful at all times, constantly endeavoring
to improve Employee's ability and knowledge of the business of Employer in an
effort to increase the value of Employee's services for the mutual benefit of
Employee and Employer.

         4. Base Compensation. Subject to the other provisions of this Agreement
and in consideration of services rendered hereunder, Employer agrees to pay the
Employee, for Employee's service during the term of Employee's employment, a
Base Salary as follows:

         For the period of October 1, 1999 through September 30, 2000, annual
compensation of Two Hundred Thirty Thousand Dollars ($230,000) payable in
bi-monthly installments of Nine Thousand Five Hundred Eighty-Three Dollars and
Thirty-Three Cents ($9,583.33) on the 15th day and last day of each month, or
upon such other installments as agreed by Employee and Employer.

         5. Bonus Compensation.

         (a) In addition to the Base Compensation provided in Paragraph 4
hereof, Employer shall pay to Employee an annual bonus to be paid in full in an
amount equal to the amount applying the Bonus Formula contained in a certain
Bonus Plan for certain Executives of Engineered Support Systems, Inc. dated
October 5, 1999 adopted by the Compensation Committee of the Board of Directors
and as from time to time amended. Such amounts shall be payable on, or before,
October 31 for each fiscal year during the term of this Agreement (subject to
the right of Employee to defer his cash bonus until the month of January of the
next calendar year with Employer's consent which consent shall not be reasonably
withheld) and shall be at the sole discretion of the Chairman upon the advise
and counsel of the Compensation Committee. The Employee's cash bonus for fiscal
year 2000 shall be a minimum of $100,000 and his equity bonus shall be a minimum
of 20,000 options with a strike price equal to the closing price of the
Employer's stock on October 1, 1999.

         (b) Employee shall be entitled to such other salary, bonuses or
deferred compensation pay as from time to time adopted by the Board of Directors
of Engineered Support Systems, Inc.

         6. Extent of Service. Employee will devote such time, attention and
energy to the business as is reasonable necessary to perform his duties.

         7. Covenants of Employee.

         (a) During the term of Employee's employment with Employer, and for a
period of two (2) years after the cessation of such employment, for whatever
reason, Employee covenants and agrees that Employee will not (except as required
in Employee's duties to Employer), in any manner directly or indirectly:

             (i) Disclose or divulge to any person, entity, firm or company
whatsoever, or use for Employee's own benefit or the benefit of any other
person, entity, firm or company, directly or indirectly, in competition with the
business of Employer, as the same may exist at the date of such cessation, any
knowledge, formulae, devices, information, business methods, techniques,
customer lists, supplier lists, business plans or other information or data of
Employer, without regard to whether all of the foregoing matters will otherwise
be deemed confidential, material or important, the parties hereto stipulating
that as between them, the same are important, material and confidential and
greatly affect the effective and successful conduct of the business and the
goodwill of Employer.

             (ii) Solicit, divert, take away or interfere with any of the
customers, trade, business, patronage, employees or agents of Employer.

             (iii) Engage, directly or indirectly, either personally or as
an employee, partner, associate, officer, manager, agent, advisor, consultant or
otherwise, or by means of any corporate or other



entity or device, in any business which is competitive (as hereinafter defined)
with the business of Employer.

         (b) For purposes hereof, a business will be deemed competitive if it is
conducted in whole or in part within the continental United States where
Employer then conducts its business and if it involves the manufacture or sale
of environmental control systems for government or commercial use, or any other
business which is in any manner competitive, during or as of the date of
cessation of Employee's employment, with any business then being conducted by
Employer or as to which Employer has then formulated definitive plans to enter.

         (c) All of the covenants on behalf of Employee contained in this
paragraph 7 shall be construed as agreements independent of any other provision
of this Agreement, and the existence of any claim or cause of action against
Employer, whether predicted on this Agreement or otherwise, shall not constitute
a defense to the enforcement by Employer of these covenants.

         (d) It is the intention of the parties to restrict the activities of
Employee under this paragraph 7 to the extent necessary for the protection of
legitimate business interests of Employer, and the parties specifically covenant
and agree that should any of the clauses or provisions set forth herein, under
any set of circumstances not now foreseen by the parties, be held by a court of
competent jurisdiction to be illegal, invalid or unenforceable under present or
future laws effective during the term of this Agreement, then and in that event,
it is the intention of the parties hereto that, in lieu of each such clause or
provision there shall be substituted or added, and there is hereby substituted
or added, as a part of this Agreement a clause or provision as similar in terms
to such illegal, invalid or unenforceable clause or provision as may be legal,
valid and enforceable.

         8.  Expenses.

         (a) During the period of Employee's employment, Employer will pay
directly, or reimburse Employee, for reasonable and necessary expenses as from
time to time authorized by the Board of Directors of Employer and incurred by
Employee in the interest of the business of Employer. All such expenses paid by
Employee, will be reimbursed by Employer upon presentation by Employee, from
time to time, of an itemized account of such expenditures, to the extent
necessary to permit the deductibility thereof for Federal income tax purposes in
accordance with the from time to time company policy.

         (b) Employer agrees to pay for the monthly dues and charges for
Employee's country club membership and such other membership privileges as are
approved by Employer's Board of Directors. To the extent that any such payments
are not deductible as ordinary and necessary business expenses, in accordance
with the Internal Revenue Code, such expenditures will be treated as additional
salary to Employee.

         9.  Automobile. During the period of this Agreement, Employer shall pay
a car allowance as from time to time adopted by the Board of Directors.

         10. Documents. Employee agrees that all documents, instruments,
drawings, plans, contracts, proposals, records, notebooks, invoices, statements
and correspondence, including all copies thereof, relating to the business of
Employer shall be the property of Employer; and upon the cessation of Employee's
employment with Employer, for whatever reason, all of the same then in
Employee's possession, whether prepared by Employee of others, will be left with
or immediately delivered to Employer.

         11. Additional Employee Benefits. The Employee shall automatically
become enrolled in the Employer's medical, life insurance, disability income,
profit sharing trust and 401(k) programs at such time as he becomes eligible to
participate in the respective programs pursuant to the terms of the respective

         12. Vacation. Employee shall be entitled to four (4) weeks paid
vacation each calendar year.



         13. Remedies. In the event of the violation of Employee of any of the
terms of this Agreement, notwithstanding anything to the contrary contained n
this Agreement, Employer may terminate the employment of Employee by written
notice thereof to Employee and with compensation to Employee only to the date of
such termination. It is further agreed that any breach or evasion of any of the
terms of this Agreement by Employee will result in immediate and irreparable
injury to Employer and will authorize recourse to injunction and/or specific
performance as well as to all other legal or equitable remedies to which
Employer may be entitled. No remedy conferred by and of the specific provisions
of this Agreement is intended to be exclusive of any other remedy, and each and
every remedy shall be cumulative and shall be in addition to every other remedy
given hereunder or now or hereafter existing at law or in equity. The election
of any one or more remedies by Employer shall not constitute a waiver of the
right to pursue other available remedies at any time or cumulatively from time
to time. Employee represents and admits that in the event of the cessation of
Employee's employment for any reason, Employee's experience and capabilities are
such that Employee can obtain employment in business engaged in other lines or
of a different nature, and that the enforcement of a remedy by way of injunction
will not prevent Employee from earning a livelihood. In the event it becomes
necessary for Employer to institute a suit at law or in equity for the purpose
of enforcing any of the provisions of this Agreement, Employer shall be entitled
to recover from Employee, Employer's reasonable attorneys' fees plus court costs
and expenses.

         14. Severability. All agreements and covenants herein contained are
severable, and in the event any of them shall be held to be invalid or
unenforceable by any court of competent jurisdiction, this Agreement shall
continue in full force and effect and shall be interpreted as if such invalid
agreement or covenant were not contained herein.

         15. Waiver or Modification. No amendment, waiver or modification of
this Agreement or of any covenant, condition or limitation herein contained
shall be valid unless in writing and duly executed by the party to be charged
therewith, and no evidence of any amendment, waiver or modification shall be
offered or received in evidence in any proceeding, arbitration or litigation
between the parties hereto arising out of or affecting this Agreement, or the
rights or obligations of the parties hereunder, unless such amendment, waiver or
modification is in writing, duly executed as aforesaid, and the parties further
agree that the provisions of this paragraph may not be waived or modified except
as herein set forth. Failure of Employee or Employer to exercise or otherwise
act with respect to any rights granted hereunder in the event of a breach of any
of the terms or conditions hereof by the other party, shall not be construed as
a waiver of such breach, nor prevent Employee or Employer from thereafter
enforcing strict compliance with any and all of the terms and conditions hereof.

         16. Notices. All notices, requests, demands or other communication
hereunder ("Notice") shall be in writing and shall be deemed given if personally
delivered or mailed by registered or certified mail, return receipt requested,
if to Employer to:

                      Engineered Support Systems, Inc.
                      Attention: David D. Mattern
                      1270 North Price Road
                      St. Louis, Missouri 63132

                  If to Employee, to:

                      Gary C. Gerhardt
                      5423 Guinevere
                      St. Charles, Missouri 63304

or to such other addresses as to which the parties hereto give Notice in
accordance with this Paragraph 16.

         17. Construction. This Agreement shall be governed by and construed and
interpreted according to the laws of the State of Missouri, notwithstanding the
place of execution hereof, nor the performance of any acts in connection
herewith or hereunder in any other jurisdiction. For all purposes hereof,
reference to Employer shall include each and every direct or indirect subsidiary
and affiliated company of Employer.



         18. Assignability. The services to be performed by Employee hereunder
are personal in nature and therefore Employee shall not assign his rights or
delegate his obligations under this Agreement, and any attempted or purported
assignment or delegation not herein permitted shall be null and void.

         19. Successors. Subject to the provisions of paragraph 18, this
Agreement shall be binding upon and shall inure to the benefit of Employer and
Employee and their respective heirs, executors, administrators, legal
representatives, successors and assigns.

         20. Severance Allowance. In the event that Employer terminates
Employee's employment for any reason except for cause, then in such event,
Employee shall be entitled to a severance allowance. This severance allowance
will be paid over a twelve (12) month period in accordance with Employer's
regular payroll schedule. During the first six months following termination, the
Employee will paid his full monthly base salary at such level in effect as of
the date of his termination. During the second six months following termination,
Employee will be paid fifty percent (50%) of his monthly base salary as of the
date of his termination. If Employer terminates this Agreement for cause, then
Employee shall not be entitled to any severance payments.

         21. Split Dollar Life Insurance. So long as this Agreement (as
extended) remains in effect, Employer agrees to keep in full force and effect a
split dollar life insurance policy having a face value of at least
$2,000,000.00, which split dollar insurance policy will be subject to a Split
Dollar Insurance Agreement that Employer enters into for Employee's benefit.

         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

"EMPLOYEE"                          "EMPLOYER"

                                         ENGINEERED SUPPORT SYSTEMS, INC.
/s/ Gary C. Gerhardt
Gary C. Gerhardt
                                         By: /s/ David D. Mattern
                                             David D. Mattern, Secretary