Exhibit 10.5
EMPLOYMENT AGREEMENT
AGREEMENT made as of the 1st day of January, 2001, by and between XXXX X.
XXXXXXXXX, an adult individual (hereinafter referred to as "Employee"), and
DIMENSIONAL VISIONS, INC., a Delaware corporation, with a principal place of
business located at 0000 X. Xxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx 00000
(hereinafter referred to as "Company");
W I T N E S S E T H:
WHEREAS, the Company and Employee desire to enter into an Agreement that
sets forth the terms and conditions of Employee's services to the Company;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto intending to be legally bound, hereby agree
as follows:
1. EMPLOYMENT TERM, DUTIES AND ACCEPTANCE.
A. Company hereby retains Employee as the Company's President and Chief
Executive Officer for a period of three (3) years (the "Employment Period"),
commencing July 1, 2001.(the "Employment Period"), earlier terminations as
hereinafter provided, to render his full time services to the Company upon the
terms and conditions herein contained, in such capacity. In such capacity
Employee shall report and be responsible to the Company's Board of Directors.
B. Employee hereby accepts the foregoing employment and agrees to devote,
on a full-time basis, his best efforts, energy and skill to such employment.
C. During the term of this Agreement, Employee shall not, except as may be
permitted by the Board of Directors, be employed by, work for, or be associated
with, directly or indirectly, as an officer, consultant, employee, or in any
other capacity, any other business operation whether or not same is competitive
with the business of the Company.
2. COMPENSATION AND EXPENSE REIMBURSEMENT.
A. As base compensation for Employee duly rendering his services pursuant
to the terms of this Agreement, Company agrees to pay and Employee agrees to
accept a base salary of Ninety-Six Thousand Dollars ($96,000) per annum payable
in equal installments, twice monthly, less such deductions or amounts as shall
be required to be withheld by applicable law or regulation, and paid in
accordance with the Company's payroll practices. Such base salary shall be
subject to increase by the Board of Directors upon annual review. Employee shall
be eligible for bonus payments in accordance with the Bonus Plan as approved by
the Board of Directors.
B. Company shall pay or reimburse Employee for travel and other expenses
reasonably incurred by Employee in the performance of his services under this
Agreement during the Employment Period, upon presentation of expense statements,
vouchers or such other supporting documentation as may reasonably be required.
3. FRINGE BENEFITS. Employee shall be entitled (subject to the terms and
conditions of particular plans and programs), to all fringe benefits afforded to
other employees of the Company, including, but not by way of limitation, the
right to participate in any pension, stock option, retirement, major medical,
group health, disability, accident and life insurance, relocation reimbursement,
and other employee benefit programs made generally available, from time to time,
by the Company except to the extent that Employee, pursuant to the terms of this
Agreement is already receiving such benefits from the Company.
4. VACATIONS. Employee shall be entitled, during each employment year, to
four (4) weeks vacation, per annum, non-cumulative.
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5. RENEWAL AND TERMINATION BY COMPANY.
A. This employment Agreement shall renew by mutual written consent on the
thirtieth month of its term for a two year period without further action by
either party, or until terminated, as provided herein.
B. Notwithstanding the stated term of employment, this Agreement and the
term of employment may be sooner terminated by the Company for cause or for any
of the following reasons:
(i) In the event Employee, in the reasonable opinion of the Company,
as determined by the Board of Directors, is unable by reason of physical or
mental disability to continue the proper performance of his duties hereunder for
a period of three (3) consecutive months, the Company may terminate Employee's
employment on a date thirty (30) days after the date on which the Company shall
have mailed written notice of such termination to Employee's last known address;
(ii) The Employee's death;
(iii) Employee has committed an act of dishonesty, theft, substance
abuse, intoxication, unethical business conduct, a material breach of the
Employment Agreement, or has been convicted of a felony; all of the foregoing
shall be separately and collectively, known as "cause" for termination.
(iv) The gross negligence, or Employee's intentional act or failure to
act (collectively) and separately hereinafter called "act"), which act
materially and adversely affects the business or affairs of the Company.
(v) The willful failure, refusal, or inability of Employee to perform
his duties as may, from time to time, be delegated to him by the Company,
through the Board of Directors.
6. NOTICE OF TERMINATION. Any purported termination by the Company shall be
communicated by written Notice of Termination to the other party hereto in
accordance with Section 18 hereof (except if the event given rise to termination
is Employee's death). For purposes of this Agreement, a "Notice of Termination"
shall mean a notice which shall indicate the specific termination provision in
this Agreement relied upon and shall set forth in reasonable detail the facts
and circumstances claimed to provide a basis for termination of Employee's
employment under the provision so indicated.
7. COMPENSATION UPON TERMINATION OR DURING DISABILITY.
A. During any period that the Employee fails to perform his duties
hereunder as a result of incapacity due to physical or mental illness, the
Employee shall continue to receive his full base salary at the rate then in
effect and all other compensation, until the Employee's employment is terminated
by the Company pursuant to Section 5 hereof, and for a three month period
thereafter (the three month period shall commence on the date the Company
notifies Employee of the Company's election to terminate Employee's employment,
pursuant to the provisions of Section 5(B) hereof).
B. If the Employee's employment shall be terminated for cause, except as
herein specifically provided to the contrary in the event the cause for
termination is death or disability, the Company shall pay the Employee his full
base salary through the date of termination at the rate in effect at the time
the Notice of Termination is given and the Company shall have no further
obligations to the Employee under this Agreement.
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C. If the Employee's employment by the Company shall be terminated without
cause, then the Employee shall be entitled to the benefits provided below:
(i) The Company shall pay the Employee an amount equal to one-half of
Employee's annual base salary at the rate in effect at the time Notice of
Termination is given, said payments to be made at the same time and in the same
manner, over a six month period, as if Emplyee had remained in the employ of the
Company; plus
(ii) Any bonus to which the Employee would otherwise be entitled, pro
rated to the effective date of termination; plus
(iii) All other amounts payable to the Employee and all benefits
payable to him under any other plan or agreement relating to retirement benefits
or to compensation previously earned and deferred, in accordance with the
respective terms of such plans or agreements, pro rated to a date three (3)
months following the date of termination.
8. TRADE SECRETS.
A. Employee acknowledges that his employment by the Company, which is in
the business of three-dimensional imaging, will enable him to obtain
confidential information concerning the Company, its subsidiaries and
affiliates, and information about the trade secrets the Company employs in its
business, including but not limited to the following: research, experiments,
inventions, discoveries and improvements conceived, developed or worked on by
the Company, whether or not related to Company's business as it now exists; data
and information about costs, profit, markets, sales, key personnel, pricing
policies; technical, scientific, patent and proprietary information and/or
processes; operational methods and other business affairs and methods, including
plans for future developments, now known or available to Employee or the public
(all of which is hereinafter collectively referred to as the "Confidential
Information"). Confidential Information shall also mean the same as trade
secrets under the 2nd Restatement of Torts. Employee and the Company further
acknowledge that the services to be performed under this Agreement are of a
special, unique, unusual and extraordinary character; the Company's products and
services will be marketed and licensed throughout the United States and abroad,
and that the Company will be competing with other organizations which are or
could be located in any part of the United States or abroad. Accordingly,
Employee agrees that he shall not use for himself or divulge any of the
Confidential Information to anyone outside of the Company's business and then
only with the prior written consent of the Company's Board of Directors.
Employee further acknowledges that he is not now and has not in the past been
engaged in any business related to that of the Company (three dimensional
imaging). Accordingly, Employee agrees that upon the termination of expiration
of this Agreement, and for a period of two (2) years thereafter, Employee will
not, directly or indirectly, alone or as a member or a partnership, or as an
officer, employee, director, stockholder or consultant, of or to any person,
firm or corporation engage in any business, directly or indirectly, the same as
or similar to and/or competitive with that of the Company as now constituted or
as may hereafter be constituted during the term of this Agreement (including its
successors or assigns) and during the two (2) year restrictive covenant period
set fourth above.
B. As a condition to the employment of the Employee, Employee further
agrees to execute the Company's standard Confidentiality and EDAC Agreements and
such other Confidentiality Agreements as may, during the term of Employee's
employment, be required by the Company of all employees in the Company's employ.
It is specifically understood that the consideration supportive of such latter
execution by Employee will be the continued employment of Employee, it being
specifically understood that the failure or refusal of Employee to execute such
latter documents (provided same is required of all employees of the Company)
would constitute cause for termination by the Company of Employee's employment
hereunder.
C. The provisions of this Section 8 shall survive the termination or
expiration of this Agreement.
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9. INJUNCTIVE RELIEF.
A. Employee acknowledges that his services to the Company are unique and
that the confidential information which will be divulged to the Employee will be
of such nature that the divulging of same by Employee to any other person, firm
or corporation or the utilization thereof by Employee, in breach of his
undertakings thereunder, could cause the Company irreparable harm or damage for
which the Company cannot be entirely compensated by an award of money damages.
It is therefore agreed that in addition to any other relief or remedy which may
be available to the Company in the event of the breach by Employee of his
confidential undertaking, the Company may seek as against the Employee
injunctive relief, and the Employee agrees that in the event such an action is
commenced by the Company against Employee which alleges, in whole or in part, a
breach or threatened breach by Employee of his confidential undertaking, to
consent, and he does hereby consent, to the issuance by the Court to a
preliminary injunction in favor of the Company restraining the Employee from
breaching his confidential undertaking as set fourth herein pending a final
determination of such judicial proceeding. The provisions hereof shall survive
the termination or expiration of this Agreement.
10. RETURN OF CONFIDENTIAL INFORMATION.Upon the termination or expiration
of this Agreement, Employee shall return to the Company all material in
Employee's possession or control which is of a confidential matter relating to
the Company's business. The provisions of this Section 10 shall survive the
termination or expiration of this Agreement.
11. Employee shall be indemnified by the Company against any liability
incurred in connection with any proceeding in which Employee may be involved by
reason of his service as an officer, director or employee of the Company except
where such liability results from willful misconduct or recklessness or where
such indemnification is prohibited by applicable law.
12. SEVERABILITY. The invalidity or unenforceability of any term of this
Agreement shall not affect the validity or enforceability of this Agreement or
any of its other terms; and this Agreement and such other terms shall be
construed as though the invalid or unenforceable term(s) were not included
herein, unless the effect would be to vitiate the parties' fundamental purpose
in entering into the Agreement.
13. REMEDIES CUMULATIVE. Except as otherwise expressly provided herein,
each of the rights and remedies of the parties set forth in this Agreement shall
be cumulative with all other such rights and remedies, as well as with all
rights and remedies of the parties otherwise available at law or in equity.
14. WAIVER. The failure of either party at any time or times to require
performance of any provisions hereof shall in no manner effect the right at a
later time to enforce the same. To be effective, any waiver must be contained in
a written instrument signed by the party waiving compliance by the other party
of the term or covenant as specified. The waiver by either party of the breach
of any term or covenant contained herein, whether by conduct or otherwise in any
one or more instances, shall not be deemed to be, or construed as, a further or
continuing waiver of any such breach, or a waiver of the breach of any other
term or covenant contained in this Agreement.
15. GOVERNING LAW. Employee agrees that this Agreement shall be governed by
the laws of the State of Arizona as applied by the courts of Arizona.
16. CAPTIONS. Captions of articles and paragraphs of this Agreement are
included for convenient reference only, shall not be construed as part of this
Agreement and shall not be used to define, limit, extend or interpret the terms
hereof.
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17. WARRANTIES. Employee represents, warrants, covenants and agrees that he
has a right to enter into this Agreement, that he is not a party to any
agreement or understanding whether or not written which would prohibit or
restrict his performance of his obligations under this Agreement and that he
will not use in the performance of his obligations hereunder any proprietary
information of any other party which he is legally prohibited from using.
18. NOTICE. Any notice required to be given pursuant to the provisions of
this Agreement shall be in writing and sent by registered mail, to the parties
at the following addresses:
To the Employer: Dimensional Visions Group, Ltd.
Attn: Board of Directors
0000 X. Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
To the Employee: Xx. Xxxx X. XxXxxxxxx
00 X. Xxxxxxx Xx.
Xxxxxxx, XX 00000
19. ASSIGNMENT. This Agreement shall inure to the benefit of and be binding
upon the Company, its successors and assigns, it being specifically agreed and
understood that in the event that the Company engages in a so-called "bulk sale"
of its assets, this Agreement may, at the Company's option, for all purposes be
deemed an asset of the Company.
20. DEFINITION. For purposes of this Agreement, the term "Company" shall
mean the Company, its subsidiaries, its successors or assignees.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
DIMENSIONAL VISIONS, INC.
By /s/ Xxxx X. XxXxxxxxx
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Xxxx X. XxXxxxxxx
Chief Financial Officer, Secretary & Director
By: /s/ Xxxx X. XxXxxxxxx
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Xxxx X. XxXxxxxxx, Individual
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