Exhibit 10.5
EMPLOYMENT AGREEMENT
--------------------
AGREEMENT, dated as of April 1, 2001, between Xxxx X. Xxxxxx
(hereinafter called "XXXXXX") and VICON INDUSTRIES, INC., a New York
corporation, having its principal place of business at 00 Xxxxx Xxxxx,
Xxxxxxxxx, Xxx Xxxx 00000 (hereinafter called the "Company").
WHEREAS, the Company and XXXXXX mutually desire to assure the
continuation of XXXXXX'x services to the Company,
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein set forth, the parties covenant and agree as follows:
1. Employment. The Company shall employ XXXXXX as its Vice
----------
President of Sales throughout the term of this Agreement, and XXXXXX hereby
accepts such employment.
2. Term. The term of this Agreement shall commence as of the
----
date of this Agreement and end on September 30, 2003 unless terminated
earlier by the Company.
3. Compensation.
------------
A. The Company shall pay XXXXXX a base salary of $140,000 per
annum, subject to periodic adjustment as determined by the President of the
Company with Board of Directors approval, but in any event shall not be less
than the base salary so indicated.
X. XXXXXX'x base salary shall be payable monthly or bi-weekly.
X. XXXXXX shall also be entitled to participate, if an
employee, in any lifeinsurance, medical, dental, hospital, disability, 401(k) or
other benefit plans as may from time to time be made available to the officers
of the Company, subject to the general eligibility and requirements of such
plans.
4. Covenant not to Compete. XXXXXX agrees that during the term
-----------------------
of this Agreement, or earlier date in case of termination for any reason by the
Company, and for a period of 24 months thereafter, he shall not directly or
indirectly within the United States or Europe engage in, or enter the employment
of or render any services to any other entity engaged in, any business of a
similar nature to or in competition with the Company's business of designing,
manufacturing and selling video security and surveillance equipment and
protection devices anywhere in the United States and Europe. XXXXXX further
acknowledges that the services to be rendered under this Agreement by him are
special, unique, and of extraordinary character and that a material breach by
him of this section will cause the Company to suffer irreparable damage; and
XXXXXX agrees that in addition to any other remedy, this section shall be
enforceable by negative or affirmative preliminary or permanent injunction in
any Court of competent jurisdiction. XXXXXX acknowledges that he may only be
released from this covenant if the Company materially breach's this agreement or
provides a written release of this provision.
5. Severance Payment on Certain Terminations or Events.
---------------------------------------------------
A. If the Company terminates XXXXXX'x employment under this Agreement for
reasons other than "Misconduct" then XXXXXX, shall be entitled to receive
severance payments as determined below, except in the case of disability under
paragraph 7. The severance amount shall be equal to one month of XXXXXX'x annual
base salary at the time of such termination for each full year of service
beginning with XXXXXX'x original start date of August 7, 1995, but excluding
time when XXXXXX was not a full time employee, up to a maximum of 12 months.
B. "Misconduct" shall mean (a) a wilful, substantial and unjustifiable
refusal or inability, due to drug or alcohol impairment, to perform
substantially the duties and services required of his position; (b) fraud,
misappropriation or embezzlement involving the Company or its assets; or (c)
conviction of a felony involving moral turpitude.
C. The severance amount shall be paid in equal monthly payments over the
number of months determined in 5A above.
6. Termination Payment on Change of Control.
----------------------------------------
A. Notwithstanding any other provision of this Agreement, if a
"Change of Control" occurs without the consent of the Board of Directors,
XXXXXX, at his option, may elect to terminate his obligations under this
Agreement and to receive a termination payment, without reduction for any offset
or mitigation, in an amount equal to three times his average annual base salary
for the five years preceding the Change of Control, in either lump sum present
valued or extended payments over three years as XXXXXX shall elect.
B. A "Change of Control" shall be deemed to have occurred if any
entity shall directly or indirectly acquire beneficial ownership of 50% or more
of the then outstanding shares of capital stock of the Company.
X. XXXXXX'x option to elect to terminate his obligations and
to receive a termination payment and to elect to receive a lump sum or
extended payments may be exercised only by written notice delivered to the
Company within 90 days following the date on which XXXXXX receives actual
notice of a Change of Control. In selecting this option the Company shall
have no obligation to XXXXXX for any severance payments under paragraph 5.
7. Death or Disability. The Company may terminate this Agreement at
--------------------
its sole option and determination without liability for severance payments under
paragraph 5 if during the term of this Agreement (a) XXXXXX dies or (b) XXXXXX
becomes so disabled for a period of six months that he is substantially unable
to perform his duties under this Agreement for such period. The Company shall be
the sole judge of such disability.
8. Arbitration. Any controversy or claim arising out of, or relating to
-----------
this Agreement, or the breach thereof, shall be settled by arbitration in the
City of New York in accordance with the rules of the American Arbitration then
in effect, and judgement upon the award rendered be entered and enforced in any
court having jurisdiction thereof.
9. Miscellaneous.
-------------
A. This Agreement contains the entire agreement between the parties
and supersedes all prior agreements by the parties relating to payments by the
Company upon involuntary employment termination with or without cause, however,
it does not restrict or limit such other benefits as the President may determine
to provide or make available to XXXXXX.
B. This agreement may not be waived, changed, modified or discharged
orally, but only by agreement in writing, signed by the party against whom
enforcement of any waiver, change, modification, or discharge is sought.
C. This Agreement shall be governed by the laws of New York State
applicable to contracts between New York State residents and made and to be
entirely performed in New York State.
D. If any part of this Agreement is held to be unenforceable by any
court of competent jurisdiction, the remaining provisions of this Agreement
shall continue in full force and effect.
E. This Agreement shall inure to the benefit of, and be
binding upon, the Company, its successor, and assigns.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement.
VICON INDUSTRIES, INC.
----------------------- By: -----------------------
Xxxx X.Xxxxxx Xxxxxxx X. Xxxxx
CEO
Vicon Industries, Inc.
