Exhibit 10.1
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT the "Agreement"), entered into as of August 30,
2004 (the "Effective Date"), between COMMAND SECURITY CORPORATION, a New York
corporation (the "Company"), and XXXXX X. XXXXXXXXXX (the "Executive").
RECITAL
The Company desires to provide for the service and employment of the
Executive with the Company and the Executive wishes to perform services for the
Company, all in accordance with the terms and conditions provided herein.
NOW, THEREFORE, in consideration of the premises and the respective
covenants and agreements of the parties herein contained, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound hereby, the parties hereto agree
as follows:
1. Employment. The Company hereby agrees to employ the Executive, and the
Executive hereby agrees to serve the Company, on the terms and conditions set
forth herein.
2. Term. The term of employment of the Executive by the Company hereunder
(the "Term") will commence as of the Effective Date and will end on September 7,
2007, unless further extended or sooner terminated as hereinafter provided.
Commencing on September 7, 2007, and on the first day of each one-year
anniversary thereafter, the Term shall automatically be extended for one
additional year unless either party shall have given notice to the other party,
at least 60 days prior to such anniversary that it does not wish to extend the
Term. References herein to the Term shall refer to both the initial term and any
extended term hereunder. Notwithstanding the foregoing, the Term shall end on
the Date of Termination (as defined in Section 6(c) hereof).
3. Nature of Performance.
(a) Position and Duties. During the Term, the Executive shall serve as
Executive Vice President and Chief Operating Officer of the Company and shall
have such responsibilities, duties and authority as are customary to such
position. The Executive shall report directly to, and be subject to the
direction of, the Board of Directors and/or the Chief Executive Officer of the
Company and such other senior executive of the Company as shall be designated
from time to time by the Board. The Executive shall devote all of his working
time and efforts to the business and affairs of the Company and shall not engage
in activities that interfere with such performance; provided, however, that this
Agreement shall not be interpreted to prohibit the Executive from managing his
personal investments and affairs, engaging in charitable activities or serving
on the board of directors of any other corporation so long as such activities do
not interfere with the performance of his duties hereunder, subject to
compliance with the Company Policies referred to in Section 7 hereof.
(b) Indemnification. To the fullest extent permitted by law and the
Company's Certificate of Incorporation and By-laws, and by the New York Business
Corporation Law, the Company shall promptly indemnify the Executive for all
amounts (including, without limitation, judgments, fines, settlement payments,
losses, damages, costs and expenses (including reasonable attorneys' fees))
incurred or paid by the Executive in connection with any action, proceeding,
suit or investigation (a "Proceeding") arising out of or relating to the
performance by the Executive of services for, or acting as a fiduciary of any
employee benefit plans, programs or arrangements of the Company or as a
director, officer or employee of, the Company or any subsidiary thereof. The
Company shall advance to the Executive all reasonable costs and expenses
incurred by him in connection with a Proceeding within 15 days after receipt by
the Company of a written request from the Executive for such advance. Such
request shall include an undertaking by the Executive to timely repay the amount
of such advance if it shall ultimately be determined that he is not entitled to
be indemnified against such costs and expenses. The Company also agrees to
maintain a directors' and officers' liability insurance policy covering the
Executive to the maximum extent the Company provides such coverage for any of
its other executive officers. Following the Term, the Company shall continue to
indemnify and maintain such insurance for the benefit of the Executive with
respect to such services performed during the Term, to the same extent as the
Company indemnifies or maintains such insurance for any of its officers,
directors, employees or fiduciaries, as applicable.
4. Place of Performance. In connection with the Executive's employment by
the Company, the Executive shall be based at the current principal executive
offices of the Company or at any other location as designated by the Board of
Directors of the Company that is within 45 miles of the borough of Manhattan, in
New York, New York, except for travel as reasonably required in connection with
the performance of the Executive's duties hereunder.
5. Compensation and Related Matters.
(a) Annual Compensation.
(i) Base Salary. For services rendered by the Executive to the
Company pursuant to this Agreement, the Company shall pay to the Executive
an annual base salary at an annual rate of $250,000, such salary to be
paid in conformity with the Company's policies relating to salaried
employees. The Base Salary may from time to time be increased as
determined by the Compensation Committee (the "Committee") of the
Company's Board of Directors (the "Board"). The annual base salary as in
effect from time to time hereunder is hereinafter referred to as the "Base
Salary".
(ii) Annual Bonus. The Executive shall be eligible to participate in
any annual incentive plan of the Company as in effect from time to time,
and shall be entitled to receive such amounts (each, a "Bonus") as may be
authorized, declared and paid by the Company pursuant to the terms of such
plan. The Committee shall set the Executive's annual performance targets
within 90 days following the Effective Date and thereafter within 90 days
following the end of each fiscal year of the Company during the Term. The
failure to set such targets in any given year shall result in the
automatic renewal of the targets for the immediately preceding year.
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(b) Participation in Stock Option Plans, Long-Term Incentive Plan and
Similar Plans. The Executive shall be eligible to receive grants under the
Company's stock option plans, long-term incentive plan and similar plans in
effect from time to time for the benefit of the Company's executives generally,
as determined from time to time by the Committee. In addition, on the Effective
Date, the Executive shall be granted stock options (the "Options") to purchase
an aggregate of 500,000 shares of the Company's common stock, par value $0.0001
per share ("Common Stock"), at an exercise price per share equal to the greater
of (i) $1.35 or (ii) the closing price of the Company's Common Stock as reported
by the OTC Bulletin Board on the business day immediately preceding the
Effective Date. Subject to Section 6(d)(ii) and Section 6(e)(v) hereof, the
Options shall vest, and may be exercised by the Executive, as follows, subject
to the terms of a written stock option agreement in the form attached hereto as
Exhibit A:
Number of Shares as to which
Date Option may be Exercised
---- -----------------------
On the Effective Date............................200,000 Shares
Commencing one year
after the Effective Date.........................12,500 Shares per month
(c) Company Defined Benefit Plans. During the Term, the Executive shall be
entitled to participate in all "defined benefit plans" (as defined in Section
3(35) of the Employee Retirement Income Security Act of 1974, as amended) or
plans, including excess benefit or supplemental retirement plans or agreements,
maintained by the Company, as now or hereinafter in effect, that are applicable
to the Company's employees generally or to any of its executive officers,
subject to and on a basis consistent with the terms, conditions and overall
administration of such plans, programs and arrangements.
(d) Other Benefits. During the Term, the Executive shall be entitled to
participate in all other employee benefit plans, programs and arrangements of
the Company, as now or hereinafter in effect, that are applicable to the
Company's employees generally or to any of its executive officers, as the case
may be, subject to and on a basis consistent with the terms, conditions and
overall administration of such plans, programs and arrangements, and subject to
Section 5(c) hereof. During the Term, the Company shall provide to the Executive
all of the fringe benefits and perquisites that are available to the Company's
employees generally or to any of its executive officers, as the case may be,
subject to and on a basis consistent with the terms, conditions and overall
administration of such benefits and perquisites; provided further, that the
Executive shall be entitled to (i) an automobile allowance of $1,000 per month
(inclusive of insurance costs and other expenses, which shall be borne by the
Executive and not the Company) and (ii) reimbursement of all gas and toll
charges relating to his commute between his residence and the Company and for
business travel.
(e) Vacations and Other Leaves. During the Term, the Executive shall be
entitled to paid vacation of four weeks annually and other paid absence for
holidays in which banks in New
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York are closed, in accordance with policies applicable generally to executive
officers of the Company; provided, however, that the Executive shall use his
best efforts to ensure that the timing and duration of vacations do not
materially interfere with the normal functioning of the Company's business
activities or the performance of the Executive's duties hereunder.
(f) Expenses. During the Term, the Executive shall be entitled to receive
prompt reimbursement for all reasonable expenses incurred by the Executive in
performing services hereunder, including all expenses of travel and
accommodations while away from home on business or at the request of and in the
service of the Company; provided however, that such expenses are incurred and
accounted for in accordance with the policies and procedures established by the
Company.
(g) Services Furnished. The Company shall furnish the Executive with
office space, secretarial assistance and such other facilities and services as
shall be suitable to the Executive's position and adequate for the performance
of his duties hereunder.
6. Termination.
(a) The Executive's employment hereunder may be terminated without breach
of this Agreement only under the following circumstances:
(i) Death. The Executive's employment hereunder shall terminate upon
his death.
(ii) Cause. The Company may terminate the Executive's employment
hereunder for "Cause." For purposes of this Agreement, "Cause" shall mean
the Executive's:
(A) failure to timely cure any material violation of any of the
terms and conditions of this Agreement or any written agreements the
Executive may from time to time have with the Company following
written notice thereof (as specified below);
(B) failure to timely cure any failure to perform his assigned
duties and responsibilities for any reason other than as a result of
his Disability (as defined in Section 6(a)(iii)) following written
notice thereof (as specified below);
(C) engaging in activities or conduct materially injurious to
the reputation of the Company or its affiliates including, without
limitation, engaging in immoral acts which become public information
or repeatedly conveying to one person or to an assembled public
group negative and inaccurate information concerning the Company or
its affiliates, except as required by law;
(D) commission of an act which constitutes a misdemeanor
(involving an act of moral turpitude) or a felony;
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(E) commission of an act of dishonesty, involving, but not
limited to, misappropriation of funds or any property of the
Company;
(F) failure to timely cure any material violation of any of the
Company Policies referred to in Section 7 hereof following written
notice thereof (as specified below); or
(G) failure to timely cure any unsatisfactory performance of
his duties or responsibilities hereunder as a consequence of alcohol
or drug abuse by the Executive following written notice thereof (as
specified below).
A termination for Cause pursuant to clauses (A), (B), (F) or (G) of this
Section 6(a)(ii) shall not take effect unless the following provisions of this
paragraph are complied with. The Executive shall be given written notice by the
Board of its intention to terminate him for Cause. Such notice shall (A) state
in detail the particular act or acts or failure or failures to act that
constitute the grounds on which the proposed termination for Cause is based and
(B) be given within three months of the Board learning of such act or acts or
failure or failures to act. The Executive shall have 30 days after the date that
such written notice has been received by the Executive to cure such conduct, to
the extent such cure is possible. If he fails to cure such conduct, the
Executive shall then be entitled to a hearing before the Board. Such hearing
shall be held within 15 days of such notice to the Executive, provided he
requests such hearing within ten days of the written notice from the Board of
the intention to terminate him for Cause. If, within five days following such
hearing, the Board provides the Executive with written notice confirming that,
in its judgment, grounds exist for termination for Cause on the basis of the
original notice, the Executive shall thereupon be terminated for Cause.
(iii) Disability. The Company may terminate the Executive's
employment hereunder for "Disability." For purposes of this Agreement,
"Disability" shall mean the Executive's material inability, by reason of
illness or other physical or mental disability, to perform the principal
duties required by the position held by the Executive at the inception of
such illness or disability, for any consecutive 180-day period. A
determination of Disability shall be subject to the certification of a
qualified medical doctor agreed to by the Company and the Executive or, if
the Executive is unable to designate a doctor as a consequence of his
disability, by the Executive's legal representative. If the Company and
the Executive cannot agree on the designation of a doctor, then each party
shall nominate a qualified medical doctor and the two doctors shall select
a third doctor, and the third doctor shall make the determination as to
Disability.
(iv) Termination by the Executive. The Executive may terminate his
employment hereunder (A) for Good Reason or (B) by providing the Company
with a Notice of Termination (as described in Section 6(b) below). For the
purpose of this Agreement, "Good Reason" shall mean (A) any material
diminution in the Executive's title, position or duties described in
Section 3(a) hereof, (B) any material breach of the provisions of Section
4 hereof with respect to the place of performance of the Executive's
services hereunder or (C) any breach by the Company of the provisions of
Section 5 hereof with respect to compensation and related matters.
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(b) Notice of Termination. Any termination of the Executive's employment
by the Company or by the Executive (other than termination under Section 6(a)(i)
hereof) shall be communicated by written Notice of Termination to the other
party hereto in accordance with Section 13 hereof. For purposes of this
Agreement, a "Notice of Termination" shall mean a written notice that shall
indicate the specific termination provision in this Agreement relied upon and,
in the case of a termination for Cause, shall set forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of the
Executive's employment under the provision so indicated.
(c) Date of Termination. "Date of Termination" shall mean (i) if the
Executive's employment is terminated by his death, the date of his death, (ii)
if the applicable Term expires because either party hereto has provided the
other party hereto notice of its desire not to extend the Term, in accordance
with Section 2 hereof or (iii) if the Executive's employment is terminated for
any other reason, the date specified in the Notice of Termination, subject to
compliance with the terms and conditions of this Agreement.
(d) Termination Upon Death; Disability; for Cause; Voluntary Termination
(other than for Good Reason). If the Executive's employment is terminated by
reason of the Executive's death or Disability, by the Company for Cause or
voluntarily by the Executive (other than for Good Reason), (i) the Company
shall, as soon as practicable after the Date of Termination, pay the Executive
(or the Executive's beneficiary, as the case may be) all unpaid amounts, if any,
to which the Executive is entitled as of the Date of Termination under Sections
5(a), 5(d), (5(e) (to the extent earned but not yet taken) and shall reimburse
the Executive for expenses incurred by the Executive but not reimbursed prior to
the date of such termination of employment, subject to and in accordance with
Section 5(f) hereof, and shall pay to the Executive, in accordance with the
terms of the applicable plan or program, all other unpaid amounts to which
Executive is then entitled under any compensation or benefit plan or program of
the Company, including, without limitation, benefits provided in accordance with
the provisions of Sections 5(c) and 5(d) hereof, and (ii) the Executive's
entitlements in respect of stock options, share units and any other long-term
incentive awards which are outstanding as of the Date of Termination shall be as
provided for in the respective agreements setting forth the terms and conditions
of each award, it being specifically understood that any unvested awards shall,
upon termination of the Executive's employment pursuant to this Section 6(d), be
forfeited as of the Date of Termination; provided, that (A) any stock options or
other rights to acquire capital stock of the Company that have vested and may be
exercised by the Executive (or his estate) as of the Date of Termination must be
exercised, if at all, within 90 days following the Date of Termination in
connection with a termination upon Death, Disability or for Cause and (B) in the
event that the Executive voluntarily terminates this Agreement by resigning
(other than for Good Reason), any stock options or other rights to acquire
capital stock of the Company that have vested and may be exercised by the
Executive as of the Date of Termination must be exercised by the Executive, if
at all, within 30 days following the Date of Termination, after which time, such
options and rights shall expire and terminate (the matters referred to in
clauses (i) and (ii) above, together with the Pro Rata Bonus Amount referred to
below, if applicable, being referred to herein collectively as "Accrued
Obligations"). In addition, if the Executive's
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employment is terminated by reason of the Executive's death or Disability, then
the Company shall, at the same time that annual incentive awards are paid to
senior level executives of the Company for the year in which the Executive's
employment so terminates, pay the Executive (or the Executive's beneficiary, as
the case may be) an amount (the "Pro Rata Bonus Amount") equal to (x) the target
bonus for the Executive for the current year multiplied by a fraction, the
numerator of which equals the number of days during which the Executive has been
employed in such current year through and including the Date of Termination, and
the denominator of which equals 365, minus (y) any bonus amounts paid or still
to be paid with respect to the Executive for such year under any annual bonus or
incentive compensation plan or program maintained by the Company; provided, that
the Executive's performance through the current year makes it possible that the
Company could have achieved the targets related to the target bonus in such
year. Upon satisfaction of the Accrued Obligations, the Company shall have no
further obligations to the Executive under this Agreement, other than those
obligations that by their nature are intended to extend beyond the termination
of the Executive's employment hereunder.
(e) Termination Other than for Cause, Disability or Death or for Good
Reason. If the Company shall terminate the Executive's employment (other than
for Cause, Disability or Death) or the Executive shall terminate his employment
for Good Reason, then, subject to compliance with the provisions of Sections 7
and 8 hereof and except as otherwise provided in Section 6(f) hereof, the
Company shall:
(i) within 30 days following the Date of Termination or otherwise in
accordance with the terms of the applicable plan or program, pay to the
Executive or otherwise cause to be satisfied the Accrued Obligations;
(ii) if the Executive is terminated within six months following the
Effective Date, the Executive shall be entitled to continue to be paid his
Base Salary for a period of six months following the Date of Termination
in accordance with the Company's normal payroll practices;
(iii) if the Executive is terminated as of a date that is more than
six months following the Effective Date, the Executive shall be entitled
to continue to be paid his Base Salary for a period of one year following
the Date of Termination in accordance with the Company's normal payroll
practices.
(iv) during the period in which the Executive shall be entitled to
receive his Base Salary pursuant to the provisions of subparagraphs (ii)
and (iii) above following the Notice of Termination (the "Continuation
Period"), continue to keep in full force and effect all programs of
medical, dental, vision, disability, life insurance, including optional
term life insurance, and other similar health or welfare programs with
respect to the Executive and his dependents with the same level of
coverage, upon the same terms and otherwise to the same extent as such
programs shall have been in effect immediately prior to the Notice of
Termination, and the Company and the Executive shall share the costs of
the continuation of such insurance coverage in the same proportion as such
costs were shared immediately prior to the Notice of Termination or, if
the terms of such programs do not permit continued participation by the
Executive (or if the Company otherwise
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determines it advisable to amend, modify or discontinue such programs for
employees generally), the Company shall otherwise provide benefits
substantially similar to and no less favorable to the Executive in terms
of cost or benefits ("Equivalent Benefits") than he was entitled to
receive at the end of the period of coverage, for the duration of the
Continuation Period. All benefits that the Company is required by this
Section 6(e)(iv) to provide, that will not be provided by the Company's
programs described herein, shall be provided through the purchase of
insurance unless the Executive is uninsurable. If the Executive is
uninsurable, the Company will provide the benefits out of its general
assets.
(v) Reimburse the Executive for expenses incurred by the Executive
but not reimbursed prior to the date of such termination of employment,
subject to and in accordance with Section 5(f) hereof.
(vi) Pay the Executive any other compensation or benefits that may
be owed or provided to the Executive in accordance with the terms and
conditions of any applicable plans and programs of the Company.
If the Company terminates Executive's employment without Cause or the
Executive resigns for Good Reason, the Executive's entitlements in respect of
stock options, share units and any other long-term incentive awards which are
outstanding as of the Date of Termination shall be as provided for in the
respective agreements setting forth the terms and conditions of each award, it
being specifically understood that any unvested awards shall, upon termination
of the Executive's employment pursuant to this Section 6(d), be forfeited as of
the Date of Termination; provided, that any stock options or other rights to
acquire capital stock of the Company that have vested and may be exercised by
the Executive as of the Date of Termination must be exercised, if at all, within
180 days following the Date of Termination, after which time, such options and
rights shall expire and terminate.
Notwithstanding the foregoing, if the Executive obtains other employment
during the Continuation Period which provides comparable health or welfare
benefits of the type described in Section 6(e)(iv) hereof ("Other Coverage"),
then Executive shall notify the Company promptly of such other employment and
Other Coverage and the Company shall thereafter not provide the Executive and
his dependents the benefits described in Section 6(e)(iv) hereof to the extent
that such comparable benefits are provided under the Other Coverage. Under such
circumstances, the Executive shall make all claims first under the Other
Coverage and then, only to the extent not paid or reimbursed by the Other
Coverage, under the plans and programs described in Section 6(e)(iv) hereof.
(f) Termination of Employment Following a Change in Control. If, within
two years following a Change in Control (as defined below), (i) the Executive's
employment is terminated by the Company (other than for Cause, death or
Disability) or (ii) the Executive terminates his employment for Good Reason, the
Executive shall be entitled to the payments and benefits provided in Section
6(e). Also, immediately upon a termination referred to in subparagraphs (i) or
(ii) of this Section 6(f) within two years following a Change in Control, all
then outstanding options, restricted stock and other equity-based awards granted
to the Executive but which have not vested as of the Date of Termination, shall
become fully vested and all options not yet
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exercisable shall become exercisable. For the purpose of this Agreement, a
"Change in Control" shall mean the occurrence of any of the following events:
(A) except as provided in Schedule 6(f), any "person" or
"group," as such terms are defined and applied in Section 13(d) of
the Securities Exchange Act of 1934 (the "1934 Act"), is or becomes
(directly or indirectly) the "beneficial owner" (within the meaning
of Rule 13d-3 promulgated under the 1934 Act), of the voting
securities of the Company representing more than 50% of the total
issued and outstanding voting securities of the Company; or
(B) a majority of the Board consists of individuals other than
"Incumbent Directors," which term means the members of the Board on
the Effective Date; provided that any individual becoming a director
subsequent to such date whose election or nomination for election
was supported by two-thirds of the directors who then comprised the
Incumbent Directors shall be considered to be an Incumbent Director;
or
(C) the Board adopts any plan of liquidation providing for the
distribution of all or substantially all of the Company's assets or
business, other than in connection with a bankruptcy, insolvency or
similar event involving the Company; or
(D) all or substantially all of the assets or business of the
Company is disposed of pursuant to a merger, consolidation or other
transaction (unless the stockholders of the Company immediately
prior to such merger, consolidation or other transaction
beneficially own, directly or indirectly, in substantially the same
proportion as they owned the voting securities of the Company, all
of the voting securities or other ownership interests of the entity
or entities, if any, that succeed to the business of the Company);
or
(E) the Company combines with another company and is the
surviving corporation but, immediately after the combination, the
holders of voting securities of the Company immediately prior to the
combination hold, directly or indirectly, 50% or less of the voting
securities (measured by number of votes entitled to be cast) of the
combined company (there being excluded from the number of shares
held by such stockholders, but not from the voting securities of the
combined company, any shares received by affiliates of such other
company in exchange for stock of such other company).
(g) Nature of Payment. Any amounts due under this Section 6 are in the
nature of severance payments considered to be reasonable by the Company and are
not in the nature of a penalty.
7. Company Policies. The Executive shall strictly follow and adhere to all
written policies of the Company ("Company Policies") that are not inconsistent
with this Agreement or applicable law including, without limitation, securities
laws compliance (including, without
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limitation, use or disclosure of material nonpublic information, restrictions on
sales of Company stock, and reporting requirements), conflicts of interest
(including, without limitation, doing business with the Company or its
affiliates without the prior approval of the Board), and employee harassment.
8. Confidentiality. The Executive will not at any time (whether during or
after Executive's employment with the Company) disclose or use for Executive's
own benefit or purposes, or for the benefit or purpose of any other person,
firm, partnership, joint venture, association, corporation or other business
organization, entity or enterprise, any trade secrets or non-public information,
data, or other confidential information relating to customers, employees, job
applicants, services, development programs, prices, costs, marketing, trading,
investment, sales activities, promotion, processes, systems, credit and
financial data, financing methods, plans, proprietary computer software, request
for proposal documents, or the business and affairs of the Company generally, or
of any affiliate of the Company; provided, however, that the foregoing shall not
apply to information which is generally known to the industry or the public
other than as a result of the Executive's breach of this covenant. The Executive
agrees that upon termination of his employment with the Company for any reason,
he will return to the Company immediately all memoranda, books, papers, plans,
information, letters and other data, and all copies thereof or therefrom
(whether in written, printed or electronic form), in any way relating to the
business of the Company and its affiliates. The Executive acknowledges and
agrees that the Company's remedies at law for a breach or threatened breach of
any of the provisions of this Section 8 would be inadequate and, in recognition
of this fact, the Executive agrees that, in the event of such a breach or
threatened breach, in addition to any remedies at law, the Company, without
posting any bond, shall be entitled to obtain equitable relief in the form of
specific performance, a temporary restraining order, a temporary or permanent
injunction or any other equitable remedy which may then be available.
9. Covenant Not to Compete.
(a) In General. The Executive agrees that during Executive's employment
with the Company and for a period of one year after the termination of such
employment for whatever reason (the "Non-Compete Period"), he shall not, in any
state or country in which the Company is conducting business at the time of such
termination:
(i) engage in any business, whether as an employee, consultant,
partner, principal, agent, representative or stockholder (other than as a
stockholder of less than a one percent equity interest) or in any other
corporate or representative capacity with any other business, whether in
corporate, proprietorship, or partnership form or otherwise, where such
business is engaged in any activity which competes with the business of
the Company or its affiliates as conducted on the date the Executive's
employment terminated or during the 180 day period prior thereto, or which
will compete with any proposed business activity of the Company in the
planning stage on such date or during such period, subject to the last
paragraph of this Section 9(a);
(ii) solicit business from, or perform services for, or induce
others to perform services for, any company or other business entity which
at any time during the one (1) year
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period immediately preceding the Executive's termination of employment
with the Company was a client of the Company or its affiliates; or
(iii) offer, or cause to be offered, employment with any business,
whether in corporate, proprietorship, or partnership form or otherwise,
either on a full-time, part-time or consulting basis, to any person who
was employed by the Company or its affiliates, in either case at any time
during the one year period immediately preceding the date the Executive's
termination of employment with the Company.
Notwithstanding the foregoing, the provisions of paragraph (i) of this
Section 9(a) shall not apply to the Executive in the event that the Executive's
employment is terminated by the Company without "Cause" or by the Executive for
Good Reason. For purposes of this Agreement, affiliates of the Company include
subsidiaries 50% or more owned by the Company.
(b) Consideration. The consideration for the foregoing covenant not to
compete, the sufficiency of which is hereby acknowledged, is the Company's
agreement to employ the Executive and provide compensation and benefits pursuant
to this Agreement.
(c) Equitable Relief and Other Remedies. The Executive acknowledges and
agrees that the Company's remedies at law for a breach or threatened breach of
any of the provisions of this Section would be inadequate and, in recognition of
this fact, the Executive agrees that, in the event of such a breach or
threatened breach, in addition to any remedies at law, the Company, without
posting any bond, shall be entitled to obtain equitable relief in the form of
specific performance, temporary restraining order, a temporary or permanent
injunction or any other equitable remedy which may then be available.
(d) Reformation. If the foregoing covenant not to compete would otherwise
be determined invalid or unenforceable by a court of competent jurisdiction,
such court shall exercise its discretion in reforming the provisions of this
Section to the end that the Executive be subject to a covenant not to compete,
reasonable under the circumstances, enforceable by the Company.
10. Company Policies, Plans and Programs. Whenever any rights under this
Agreement depend on the terms of a policy, plan or program established or
maintained by the Company, any determination of these rights shall be made on
the basis of the policy, plan or program in effect at the time as of which the
determination is made. No reference in this Agreement to any policy, plan or
program established or maintained by the Company shall preclude the Company from
prospectively or retroactively changing or amending or terminating that policy,
plan or program or adopting a new policy, plan or program in lieu of the
then-existing policy, plan or program.
11. Successors; Binding Agreement.
(a) Neither this Agreement nor any rights hereunder shall be assignable or
otherwise subject to hypothecation by the Executive (except by will or by
operation of the laws of intestate succession or except as expressly provided in
this Agreement or in any plan or agreement that is
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the subject matter hereof) or by the Company, except that the Company will
require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or
assets of the Company, by agreement in form and substance reasonably
satisfactory to the Executive, to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform it if no such succession had taken place. As used in this
Agreement, "Company" shall mean the Company as herein before defined and any
successor to its business and/or assets as aforesaid which executes and delivers
the agreement provided for in this Section 11 or which otherwise becomes bound
by the terms and provisions of this Agreement by operation of law.
(b) This Agreement and all rights of the Executive hereunder shall inure
to the benefit of and be enforceable by the Executive's personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. If the Executive should die while any amounts would still
be payable to him hereunder if he had continued to live, all such amounts,
unless otherwise provided herein, shall be paid in accordance with the terms of
this Agreement to the Executive's devisee, legatee, or other designee or, if
there be no such designee, to the Executive's estate.
12. Notice. For the purposes of this Agreement, notices, demands and all
other communications provided for in this Agreement shall be in writing and
shall be deemed to have been duly given when delivered personally, dispatched by
private courier such as Federal Express or United Parcel Service, or (unless
otherwise specified) mailed by United States certified or registered mail,
return receipt requested, postage prepaid, addressed as follows:
If to the Company:
Command Security Corporation
Rte. 00 Xxxxxxxxx Xxxx
Xxxxxxxxxxxxx, XX 00000
Attn: President
With a copy to:
Xxxxxx Xxxxx Xxxxxxxx & Xxxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxxxx, Esq.
If to the Executive:
Xxxxx X. Xxxxxxxxxx
00 Xxxx Xxxxx
Xxxx Xxxxxxxx, XX 00000
or to such other address as any party may have furnished to the other in writing
in accordance
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herewith, except that notices of change of address shall be effective only upon
receipt.
13. Miscellaneous. No provisions of this Agreement may be modified, waived
or discharged unless such waiver, modification or discharge is agreed to in
writing signed by the Executive and a duly authorized officer of the Company. No
waiver by either party hereto at any time of any breach by the other party
hereto of, or compliance with, any condition or provision of this Agreement to
be performed by such other party shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent
time. No agreements or representations, oral or otherwise, express or implied,
with respect to the subject matter hereof have been made by either party that
are not set forth expressly in this Agreement. The validity, interpretation,
construction and performance of this Agreement shall be governed by the laws of
the State of New York without regard to its conflicts of law principles. All
payments hereunder shall be subject to applicable federal, State and local tax
withholding requirements.
14. Company's and Executive's Representations and Warranties.
(a) The Company represents and warrants that it is fully authorized and
empowered to enter into this Agreement and that the performance of its
obligations under this Agreement will not violate any agreement between it and
any other person, firm or organization.
(b) The Executive represents and warrants that he has the legal right to
enter into this Agreement and perform all of the material obligations on his
part to be performed hereunder in accordance with its terms and that he is not a
party to any agreement or understanding, written or oral, that prevents him from
entering into this Agreement or performing his material obligations hereunder.
Notwithstanding any other provision of this Agreement, in the event of a breach
of such representation or warranty on the Executive's part, the Company shall
have the right to terminate this Agreement forthwith in accordance with the
notice provisions set forth in Section 6(a)(ii) hereof, and the Company shall
have no further obligations to the Executive hereunder.
15. Validity. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect.
16. Counterparts. This Agreement may be executed in one or more
counterparts, including by facsimile, each of which shall be deemed to be an
original but all of which together will constitute one and the same instrument.
17. Arbitration. Any dispute or controversy arising under or in connection
with this Agreement shall be settled exclusively by arbitration, conducted
before one arbitrator to be mutually agreed upon by the parties hereto. In the
event the parties are unable to agree upon an arbitrator, the Company and the
Executive shall each appoint an arbitrator, and these two arbitrators shall
select a third, who shall be the arbitrator. Arbitration shall be held in New
York, New York, in the Borough of Manhattan, in accordance with the rules of the
American Arbitration Association then in effect. Judgment may be entered on the
arbitrator's award in any court having jurisdiction; provided however, that the
Company shall be entitled to seek a restraining order or injunction in any court
of competent jurisdiction to prevent any continuation
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of any violation of the provisions of Section 8 or 9 of the Agreement and the
Executive hereby consents that such restraining order or injunction may be
granted without the necessity of the Company's posting any bond, it being
acknowledged and agreed that any breach or threatened breach of the provisions
of Section 8 or 9 will cause irreparable injury to the Company and that money
damages will not provide an adequate remedy to the Company. Each party shall
bear its own costs and expenses (including, without limitation, legal fees) in
connection with any arbitration proceeding instituted hereunder.
18. Survivorship. The respective rights and obligations of the parties
hereunder shall survive any termination of the Executive's employment to the
extent necessary to the intended preservation of such rights and obligations.
19. Expenses in connection with this Agreement. The Company shall pay all
of the Executive's reasonable legal fees and expenses in connection with the
preparation, negotiation and execution of this Agreement.
20. Entire Agreement. This Agreement sets forth the entire agreement of
the parties hereto in respect of the subject matter contained herein and all
other prior agreements, promises, covenants, arrangements, communications,
representations or warranties, whether oral or written, by any officer, employee
or representative of any party hereto, and any prior agreement of the parties
hereto in respect of the subject matter contained herein is hereby terminated
and cancelled. To the extent that this Agreement and any other agreement between
the parties provide duplicative payments or benefits, this Agreement and any
such other agreement shall be construed so as to prevent such duplication.
[signatures appear on following page]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date.
COMMAND SECURITY CORPORATION
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
EXECUTIVE
____________________________________________
Xxxxx X. Xxxxxxxxxx
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Schedule 6(f)
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Possible transaction with Xxxx X. Xxxxx or any company with which Xx. Xxxxx is
affiliated.
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