Agreement Relating to Employment and Post-Employment Competition - ARA Services Inc. and Julian L. Carr Jr.
AGREEMENT RELATING TO EMPLOYMENT AND
POST-EMPLOYMENT COMPETITION*
This Agreement is between the undersigned individual ("Employee") and
ARA Services, Inc. ("ARA").
RECITALS
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A. ARA is a service management company which provides a variety of services
to business and industry, private and public institutions, and the general
public primarily in the following markets: food and refreshment services;
healthcare; childcare, periodical distribution, uniform rental and
maintenance.
B. ARA has a proprietary interest in its business methods and systems
("Systems") which include, but are not limited to, policy and procedure
manuals, computer programs, financial forms and information, supplier
information, supplier information, recipes, accounting forms and procedures,
personnel policies and information on the needs of clients, all of which
information is not publicly disclosed and is considered by ARA to be
confidential trade secrets; and
C. ARA intends to employ Employee in a position where Employee will have
access to information relating to ARA's Systems and ARA will encourage
Employee to develop personal relationships with ARA's clients and prospective
clients; and
D. ARA will be vulnerable to unfair post-employment competition by Employees
since Employee will have access to ARA Systems and will have a personal
relationship with ARA's clients and prospective clients; and
E. In consideration of the severance and other employment benefits provided
for herein, Employee was willing to enter into this Agreement with ARA as a
condition of employment, pursuant to which Employee will limit his right to
compete against ARA following termination of employment for any reason to the
limited extent set forth in this Agreement.
* This Agreement covers individuals in Grade N or Higher.
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NOW, THEREFORE, intending to be legally bound, the parties agree as follows:
Article 1. NON-DISCLOSURE AGREEMENT: ARA may, pursuant to Employee's
employment hereunder provide and confide to Employee ARA's Systems,
techniques and methods of operation developed at great expense by ARA and
which Employee recognizes to be unique assets of ARA's business. Employee
shall not, during or after the term of employment, directly or indirectly,
in any manner utilize or disclose to any person, firm, corporation,
associaiton or other entity, except where required by law: (a) any such
Systems, techniques and methods of operation; (b) any sales prospects,
customer lists, products, research or data of any kind; or (c) any information
relating to strategic plans, sales costs, profits or the financial condition
of ARA or any of its customers or prospective customers, which is not
generally known to the public or recognized as standard practice in the
industries in which ARA shall be engaged.
Article 2. NONCOMPETITION AGREEMENT:
A. Subject to the provisions of Paragraphs B and E, below, Employee, for a
period of two (2) years folowing termination of his employment, shall not,
without ARA's written permission, directly or indirectly, on Employee's behalf
or on behalf of any other person, firm, corporation, association or other
entity, engage in, or in any way be concerned with or negotiate for, or
acquire or maintain any ownership interest in any business or activity which
is the same, similar to or competitive with that conducted by, engaged in or
developed for later implementation by ARA at any time during the term of
Employee's employment.
B. The provisions set forth in Paragraph A, above, shall apply to (i) all
fifty states and (ii) each foreign country, possession or territory in which
ARA may be engaged in business at the termination of Employee's employment or
at any time within twelve (12) months prior thereto; but only if Employee was
directly or indirectly involved or exposed to plans for such business at any
time within twelve (12) months prior to termination.
C. Employee further agrees that Employee shall not for a period of two
years, directly or indirectly, at any time in any manner, induce or attempt
to influence any employees of ARA to terminate their employment with ARA.
D. Employee acknowledges that in the event of any violation by Employee of
the provisions set forth in Article 1 above or this Article 2, ARA will
sustain serious, irreparable and substantial harm to its business, the extent
of which will be difficult to determine and impossible to remedy by an action
at law for money damages. Accordingly,
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Employee agrees that, in the event of such violation or threatened violation
by Employee, ARA shall be entitled to an injunction before trial from any
court of competent jurisdiction as a matter of course upon the posting of not
more than a nominal bond, in addition to all such other legal and equitable
remedies as may be available to ARA. Employee further agrees that, in the
event any of the provisions of this Agreement are determined by a court of
competent jurisdiciton to be contrary to any applicable statute, law or rule,
or for any reason unenforceable as written, such court may modify any of
such provisions so as to permit enforcement therefor as thus modified.
E. Notwithstanding anything to the contrary in this Agreement, if ARA elects
to terminate Employee's employment for any reason other than good and
sufficient cause, then, in such event the term of the non-competition
provision set forth in Paragrph A above shall be reduced to the number of
months that Employee is entitled to severance pursuant to the Following
Article 4A, below.
Article 3. EXECUTIVE CORPS PROGRAMS: Employee shall be eligible to
participate in the following Executive Corps programs while a member of the
Executive Corps to the extent ARA continues to make such programs available
to Executive Corps members:
* Executive Corps Health Care Plan
* Executive Corps Long Term Disability Insurance
* Survivor Income Protection Plan
* Executive Corps Automobile Program
Such Executive Corps programs may be amended or revoked at any time, without
notice to Employee, in the sole discretion of ARA.
Article 4. SEVERANCE BENEFITS: If Employee is terminated by ARA for any
reason other than good and sufficient cause, Employee shall be entitled to
the following severance benefits:
A. Severance Pay: Employee shall receive severance payments equivalent to
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Employee's base salary rate for the number of months set forth below:
Years of ARA Continuous Service
Completed from Last Hire Date
- -----------------------------
10 or
2 3 4 5 6 7 8 9 more
- - - - - - - - -----
9 9 10 11 12 13 14 16 18
Severance payments shall be made in installments in accordance with ARA's
normal payroll cycle.
B. Other Severance Benefits:
(1) Group medical and life insurance coverages shall continue under
then prevailing terms as long as severance payments are being made to
Employee. Deductions for Employee's share of the premiums will be made
from Employee's severance payments. Group medical coverage provided during
such period shall be applied against ARA's obligation to continue group
medical coverage under the Consolidated Omnibus Budget Reconciliation Act
of 1985 ("COBRA"). Upon termination of group medical and life insurance
coverages, Employee may convert, at his cost, to individual policies.
(2) Employee's eligibility to receive or participate in all other benefit
and compensation plans, including, but not limited to Management Incentive
Bonus, Long Term Disability, Retirement Savings, and Stock Option Plans,
shall terminate as of the effective date of Employee's termination unless
provided otherwise under the terms of a particular benefit or compensation
plan, provided, however, participation in programs made available solely to
Executive Corps members shall cease as of the effective date of Employee's
termination or the date Employee's Executive Corps membership ceases,
whichever should occur first.
C. Termination for good and sufficient cause: shall include termination for
such things as fraud or dishonesty, willful failure to perform assigned
duties, willful violation of ARA's Business Conduct Policy, or intentionally
working against the best interests of ARA.
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D. If Employee is terminated by ARA, for reasons other than good and
sufficient cause, Employee will receive severance payments and benefits for
the number of months set forth above in Paragraph A, whether or not Employee
commences other non-competitive employment while he is receiving such
payments and benefits, provided, however, ARA reserves the right to terminate
all severance payments and benefits if Employee violates the covenants set
forth in Article 2, above.
E. ARA expressly reserves the right to revoke or amend, in whole or in part,
the severance provisions set forth in this agreement at any time, for any
reason, provided, however, in the event Employee is terminated for reasons
other than good and sufficient cause subsequent to such revocation or
amendment, Employee shall be entitled to no less than the monthly severance
payments which Employee would have received under this Agreement had he
been terminated by ARA on the date ARA elected to revoke or amend the
severance provisions.
F. During any period of disability following termination of Employment,
Employee agrees that disability payments received by him pursuant to health
and accident or disability policies, whether on account of total or partial
disability, shall be credited against the severance payments due him
hereunder.
Article 5. TERM OF EMPLOYEMENT: Employee acknowledges that ARA has the
right to terminate Employee's employment at any time for any reason
whatsoever, provided, however, that any termination by ARA for reasons other
than good and sufficient cause shall result in the severance benefits
described in Article 4, above, to become due in accordance with the terms
of this Agreement. Employee further acknowledges that the severance
payments made and other benefits provided by ARA are in full satisfaction
of any claims that Employee may have against ARA resulting from ARA's
exercise of its right to terminate Employee's employment, except for those
fringe benefits which are intended to survive termination such as the right
to receive payments pursuant to retirement plans and similar rights.
Article 6. MISCELLANEOUS:
A. As used throughout this Agreement, ARA shall include The ARA Group,
Inc., a Delaware corporation, and its subsidiaries and affiliates, or any
corporation, joint venture, or other entity in which The ARA Group Inc. or
its subsidiaries or affiliates has an equity interest in excess of ten
percent (10%).
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B. Reference to the masculine gender shall include the feminine gender.
C. This Agreement shall supercede and substitute for any previous
employment agreement between employee and ARA, and is entered into in
consideration of the mutual undertakings of the parties, the cancellation of
all previous agreements, and the release of the parties of their respective
rights and obligations under any previous employment agreement, excepting
only such rights and obligations which by their nature are intended to
survive termination or cancellation of such employment agreement. In the
event Employee's previous employment agreement provided for a longer
severance period than set forth in this Agreement, then the Employee's
right to severance set forth in the previous employment agreement shall
survive, but any payments made shall be credited against the severance
payments otherwise due under the provisions of Article 4A, hereof.
D. Employee and ARA acknowledge that for purpose of Article 4 Employee's
last hire date with ARA is April 22, 1978.
IN WITHNESS WHEREOF, the parties hereto have caused this Agreement to be
signed.
/s/ JULIAN L. CARR, JR.
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JULIAN L. CARR, JR.
ARA SERVICES, INC. ("ARA")
By: /s/ JAMES E. KSANSNAK
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JAMES E. KSANSNAK
Date: October 1, 1991
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09/91