EMPLOYMENT AGREEMENT
THIS
EMPLOYMENT AGREEMENT (“Agreement”) is made and entered into this 15th day of
June 2006, by and between Invisa, Inc., a Nevada corporation. (the “Company”)
and Xxxx X. Xxxxx (the “Employee”).
RECITALS:
WHEREAS,
Employee
wishes to continue to be employed by the Company, and the Company wishes
to
continue employing the Employee. (Xxxx X. Xxxxx began employment with Invisa,
Inc. on August 1, 2001.)
WHEREAS,
the
parties acknowledge that the Company has advised Employee that the auditor’s
opinion which accompanies the Company’s Financial Statements for the year ended
December 31, 2005, may express concern over the Company’s ability to remain a
“going concern”.
WHEREAS,
the
Company and the Employee are desirous of setting forth in this definitive
Employment Agreement their respective rights and obligations in respect to
Employee’s employment with the Company.
NOW,
THEREFORE,
in
consideration of Employee’s employment and in consideration of the mutual
promises in this Agreement, and for additional good and valuable consideration,
the receipt and sufficiency of which are acknowledged by the parties hereto,
the
Company and the Employee agree as follows:
1. Employment
and Term.
On
the
terms and subject to the conditions of this Agreement, the Company agrees
to
employ the Employee and the Employee accepts such employment. Employee’s
employment under this Agreement shall commence on the date hereof, and shall
continue in effect, as described in Exhibit “A”, unless earlier terminated
pursuant to Paragraph 6 herein below.
2. Duties.
The
Employee is employed by the Company to perform the duties specified from
time to
time by the Board of Directors and as set forth on Exhibit “A” which is attached
hereto, incorporated herein and made a part hereof (“Duties”).
3. Compensation.
As
compensation for Employee performing the Duties, the Company shall pay Employee
the compensation as set forth on Exhibit “B” which is attached hereto,
incorporated herein and made a part hereof (“Compensation”).
4. Vacations.
Employee shall be entitled each year to a vacation as provided in Exhibit
“B”,
during which time Employee’s Compensation shall be paid in full.
5. Fringe
Benefits and Reimbursement of Expenses.
a. Employee
shall be entitled to participate in any group plans or programs maintained
by
the Company, if any, such as health insurance or other related benefits as
may
be in effect from time to time and offered to the other employees of the
Company
(“Benefits”).
b. Company
acknowledges that it will pay for reasonable expenses incurred by Employee
in
furtherance of his duties to the Company, which shall include, without
limitation, expenses for entertaining,
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travel
and similar items. All such expenses will be in incurred in accordance with
policies adopted by the Company from time to time.
c. The
Company shall provide Employee actual gasoline expenses for Company business
at
IRS rates.
6. Termination
of Employment.
6.1 Prior
to
the Termination Date, this Agreement and all the rights and obligations of
the
parties hereto shall terminate immediately: (i) in the event of the Employee’s
death; or (ii) if the Company ceases to conduct business.
6.2 Prior
to
the Termination Date, the Company may, upon written notice to the Employee,
immediately thereafter terminate the Employee’s employment for proper cause,
pursuant to the grounds set forth herein (“For Cause”), and in the event of such
For Cause termination, the Employee shall not be entitled to any Compensation
or
Lump Sum Severance Package Compensation as hereinafter defined following
the
date set forth on the written notification of such For Cause termination,
other
than options that are fully vested as of the date of the For Cause termination.
The grounds for For Cause termination are the occurrence of any of the
following: (i) indictment of Employee on felony charges; (ii) Employee’s
engagement in illegal business practices in connection with the Company’s
business; (iii) Employee’s intentional and material misappropriation of the
Company’s assets; (iv) the Employee’s breach of: Company policies; this
Agreement; the Covenant Not To Compete Agreement attached hereto as Exhibit
“C”;
the Confidentiality/Waiver of Interest Agreement attached hereto as Exhibit
“D”.
With respect to a For Cause termination under (iv), the written notice will
provide the Employee 10 days within which to cure the breach (“Cure Period”),
and if it is not cured within that period, the For Cause termination will
become
immediately effective. With regard to the Covenant Not to Compete Agreement
attached as Exhibit “C” and the Confidentiality/Waiver of Interest Agreement
attached as Exhibit “D”, the Cure Period will run concurrently with (and not be
in addition to) the Mediation Period as defined in Exhibits “C” and
“D”.
6.3 Prior
to
the Termination Date, the Company may, upon 30 days written notice to the
Employee, immediately thereafter terminate the Employee’s employment without
cause (For Cause being limited to the grounds set forth in Paragraph 6.2
herein
above). In the event of such without cause termination, after the initial
3
months of employment with the Company, the Company shall for a period of
90 days
following the date of such termination ( the “Severance Payment Period”)pay to
Employee severance compensation consisting of the Compensation and Benefits
(as
set forth on Exhibit “B”) which would have been due and payable to Employee
under this agreement had Employees employment not been terminated without
cause
(“Severance Package Compensation”). In the event of a termination without cause,
which occurs after the initial 12 months of employment by Employee under
this
Agreement, the Severance Package Compensation shall be increased to equal
the
compensation and Benefits which would have been paid to Employee for 180
days
(i.e., the Severance Payment Period is increased from 90 days to 180 days).
In
the event of termination without cause during the initial 3 months of employment
by Employee under this Agreement, no Severance Package Compensation or other
severance payment of any description shall be due as a result of such
termination. The Severance Package Compensation shall be paid during the
Severance Payment Period at the same intervals as the Compensation and Benefits
would have been paid had the employment not been terminated. The Severance
Package Compensation shall constitute the only compensation due to Employee
as
the result of termination of employment without cause and the Company shall
have
no additional liability to Employees as a result of such termination of
employment without cause. Termination of Employment by the Company for
disability of Employee shall be deemed termination without cause.
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6.4 Prior
to
the Termination Date, in the event that (1)there shall be a Change in Control
(as defined below) in the Company or (2) the scope of Employee's duties with
the
Company shall significantly change, the Employee may, upon 30 days written
notice to the Company given within 30 days of the change set forth in (1)
or (2)
above, terminate Employee’s employment with the Company, and in such event,
Employee shall not be entitled to any compensation following the date of
such
termination, other than options. Any un vested options shall fully vest as
of
the date of the termination.
(i) The
acquisition by any individual or entity of beneficial ownership of 50% or
more
of the then outstanding shares of common stock of the Company in one transaction
or
(ii) The
consummation of a reorganization, merger or consolidation or sale or other
disposition of all or substantially all of the assets of the Company (a
“Business
Combination)
unless,
following such Business Combination, more than 50% of the then outstanding
shares of common stock of the corporation resulting from such Business
Combination is owned by the Company's shareholders ; or
(iii) The
individuals who on the date of this Agreement constitute the Board of Directors
or the senior executive management of the Company thereafter cease to constitute
at least a majority thereof.
6.5 In
the
event this Agreement is not terminated prior to its Termination Date as set
forth hereinabove in this Paragraph 6, then in such event this Agreement
shall
terminate upon the Termination date.
7. Non-Competition.
Simultaneously with his execution of this Agreement Employee shall execute
a
Covenant Not to Compete Agreement with the Company, as set forth on Exhibit
“C”
which is attached hereto, incorporated herein and made a part hereof The
parties
acknowledge and agree that the mediation provisions and remedy provisions
of the
Covenant Not to Compete Agreement as set forth in Paragraphs 4 and 5
respectively
thereof are the dispute resolution and remedy provisions that govern the
parties
under the Covenant Not to Compete Agreement and Paragraph 13 of this Agreement
is not applicable thereto.
8. Confidentiality/Waiver
of Interest.
Simultaneously with his execution of this Agreement, Employee shall execute
a
Confidentiality/Waiver of Interest Agreement with the Company, as set forth
on
Exhibit “D” which is attached hereto, incorporated herein and made a part hereof
The parties acknowledge and agree that the mediation provisions and the remedy
provisions of the Confidentiality/Waiver of Interest Agreement as set forth
in
Paragraphs 7 and 8 respectively thereof are the dispute resolution and remedy
provisions that govern the parties under the Confidentiality/Waiver of Interest
Agreement and Paragraph 13 of this Agreement is not applicable
thereto.
9.
Notices.
Any
notice provided for in this Agreement must be in writing and must be either
personally delivered or mailed by certified mail, return receipt required,
to
the recipient at the address indicated below:
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To
the Company: To
the Employee:
Invisa,
Inc. Xxxx
X.
Xxxxx
0000
00xx
Xxxxxx
Xxxx, Xxxxx 000 00000
0xx
Xxxxxx
X
Xxxxxxxx,
XX 00000 Xxxxxxxxx,
XX 00000
Or
such
other addresses or to the attention of such other person as the recipient
party
shall have specified by prior written notice to the sending party.
10. Severability.
In the
event that any provision of this Agreement shall be held to be unreasonable,
invalid, or unenforceable for any reason whatsoever, the parties agree that:
(i)
such invalidity or unenforceability shall not affect any other provision
of this
Agreement and the remaining covenants, restrictions, and provisions hereof
shall
remain in full force and effect; and (ii) any court, arbitrator or arbitration
panel, as the case may be, may so modify the objectionable provision as to
make
it valid, reasonable, and enforceable, and such provision, as so modified,
shall
be valid and binding as though the invalid, unreasonable, or unenforceable
portion thereof had not been included therein.
11. Complete
Agreement.
This
Agreement contains the entire agreement of the parties and supersedes and
preempts any prior understandings, agreements or representations between
Employee and Company regarding the employment of Employee.
12. Counterparts.
This
Agreement may be simultaneously executed in two counterparts, each of which
shall be an original, and all of which shall constitute but one and the same
instrument.
13. Mediation/Arbitration
Provision.
The
parties shall in good faith endeavor to resolve all claims or disputes arising
from or relating to the terms of this Agreement first by mediation through
a
mediator selected by the parties and if not resolved by mediation, then the
parties agree to resolve all claims or dispute by binding arbitration in
accordance with this Section. The party seeking mediation shall submit a
written
notice for mediation to the other party (the “Notice”). The parties shall agree
on a mediator and mediation date within ten business (10) days from the date
of
the Notice. If the parties are unable to agree upon a mediator and mediation
date within ten (10) business days from the date of the Notice, the matter
shall, within twenty (20) business days from the date of the Notice, be referred
to the American Arbitration Association for final and binding arbitration.
If
the matter is mediated but not resolved by mediation, the matter shall, within
ten (10) days from the last mediation proceeding, be referred to the American
Arbitration Association for final and binding arbitration. The arbitration
proceedings shall take place in Sarasota County, Florida and shall be governed
by the Florida Arbitration Code and the rules pertaining to commercial
arbitration of the American Arbitration Association then in effect (except
the
provisions of this paragraph shall govern if in conflict with such rules).
There
shall be one arbitrator if the amount in controversy is less than twenty
four
thousand dollars ($24,000), and otherwise there shall be three arbitrators.
The
arbitration award may be entered in any court of competent jurisdiction,
as
provided for in this Agreement, for an order of enforcement if necessary.
The
costs of the arbitration shall be divided equally between the parties. No
party
shall be entitled to recover attorneys fees incurred in any arbitration
proceeding from the other party. However, if either party is required to
take
legal action to enforce or collect the award, the prevailing party in such
legal
action shall be entitled to collect all costs and reasonable attorney’s fees and
other expenses from the other party.
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14. Employee
Representation.
Employee represents that he is currently not subject to any contract, agreement
or understanding with any other party or entity that restrict his employment
in
any way or provides for any not compete or non-disclosure obligations upon
Employee, other than as set forth in Exhibit C hereto, copies of which
agreements are attached to such Exhibit.
15. Amendments/Waivers.
This
Agreement may only be modified, amended, or waived by a
writing
duly authorized and executed by all parties.
16. Draftsman.
In
construing this Agreement, neither of the parties hereto shall have any term
or
provision of this Agreement construed against such party solely by reason
of
such party having drafted same as each provision of this Agreement is deemed
by
the parties to have been jointly drafted by the Company and the
Employee.
17. SEC
Compliance.
Employee
acknowledges that the Company, as of the date hereof, is a “Reporting Company”
under the Securities Exchange Act of 1934 as amended (the “Act”). While the
Company remains a Reporting Company, its officers and directors, and certain
shareholders are required to file periodic reports under Section 16, as it
relates to the ownership, acquisition and disposition of their equity of
Invisa,
Inc. Employee agrees that he will timely file Section 16 reports regarding
his
equity ownership of Invisa, Inc. Employee further agrees that he will abide
by
Regulation FD and Invisa, Inc.’s written policies as may adopted from time to
time regarding xxxxxxx xxxxxxx and disclosure of non-public
information.
18. Governing
Law.
This
Agreement shall be governed by and construed in accordance with the laws
of the
State of Florida.
In
Witness Whereof,
the
parties have executed this Agreement on the day and year first above
written.
The
Company: Employee:
Invisa,
Inc.
By:
/s/Xxxxxx
X. King______________________ /s/Xxxx
X. Xxxxx._____________________
Xxxxxx
X.
Xxxx Xxxx
X. Xxxxx
Chief
Financial Officer
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Exhibit
“A”
Between
Invisa,
Inc.
And
Xxxx
X.
Xxxxx
In
accordance with Paragraph 2, Employee shall perform the following
duties:
From
June
15, 2006 to June 15, 2009, Employee shall be employed as the President and
Chief
Operating Officer (“PRES”) of the Company.
President
From
June
15, 2006 to June 15, 2009, Employee shall be employed as President of the
Company. As President, Employee shall work with the Company’s Board of Director
to establish revenue targets and overall company direction. Employee shall
be in
charge of and have final decision making authority for the day to day management
and operation of the company which shall include without limitation budgeting,
marketing, research and development and personnel. For purposes of this
agreement “personnel” shall include the selection, recruitment, hiring,
promotion and termination of employees, consultants and independent contractors.
All employees of the Company shall without limitation report directly to the
President. The president shall report to the Board of Directors and shall work
with the Board of Directors to establish all revenue targets for the Company,
including those for systems, hardware, development contracts and licensing.
In
Witness Whereof,
the
parties have executed this Agreement on June 15,2006
The
Company: Employee:
Invisa,
Inc.
By:
_____/s/ Xxxxxx X. King_________________________________ /s/
Xxxx X. Xxxxx
Xxxxxx
X. Xxxx Xxxx
X.
Xxxxx
Chief
Financial Officer
Exhibit
“B”
Between
Invisa,
Inc.
And
Xxxx
X.
Xxxxx
In
accordance with Paragraph 3, Employee shall be paid the following Compensation
payable as set forth below:
1. The
salary to be paid by Employer hereunder shall be $125,000 per year, gross
salary, and payable in 26 equal bi-weekly increments (less customary withholding
for federal and state employment taxes).
2. Two
weeks
vacation in year one, three weeks in from year two.
3. The
Company will reimburse the Employee for reasonable business expenses approved
in
advance and incurred by Employee in furtherance of his duties to the Company,
which shall include, without limitation, expenses for entertaining, travel
and
similar items. All such expenses will be incurred in accordance with policies
adopted by the Company from time to time.
4.
Employee shall be permitted to participate in all employee benefit plans. The
Company shall pay for health insurance premiums under the Company’s plan for
Employee and Employee’s family members.
In
Witness Whereof,
the
parties have executed this Agreement on June 15, 2006
The
Company: Employee:
Invisa,
Inc.
By:
__/s/ Xxxxxx X. King___________________________________ /s/
Xxxx
X. Xxxxx
Xxxxxx
X Xxxx Xxxx
X
Xxxxx
Chief
Financial Officer and Director