EXHIBIT 10.53
EMPLOYMENT AGREEMENT
This AGREEMENT is made and entered into as of the 7th day of December 2000, by
and between PARAVANT INC., a Florida corporation (the Company) and XXXXXXX X.
XXXXXX, (the Employee).
WHEREAS, the Company desires to obtain the benefit of the services of the
Employee, and the Employee desires to render such services on the terms and
conditions hereinafter set forth; and,
WHEREAS, the Company and the Employee desire to provide limited protection of
the Employee's employment in the event of a change in ownership of the Company
by virtue of a sale, merger by the Company into, or the combination with,
another corporation or other form of takeover wherein the new ownership may
terminate the employee without cause.
NOW, THEREFORE, the Parties hereto, in consideration of the premises and the
mutual covenants herein contained, hereby agree as follows:
1. Termination of Prior Agreement. Upon the execution of this Agreement, all
prior employment agreements between the Employee, and the Company or any of its
affiliates, subsidiaries, and predecessor constituent corporations are
terminated and are of no further force and effect.
2. Term of Employment. Subject to the terms and conditions hereinafter set
forth, the Company hereby enters into the employment of the Employee, or any of
subsidiary or affiliate of the Company, as the Company shall, from time to time,
select, for an employment term commencing on the date of execution of this
Agreement and terminating on 31 December 2002. The period during which the
Employee is employed pursuant to this Agreement is hereinafter called the Term
of Employment. The Term of Employment will normally be submitted to the Board of
Directors, at the first board meeting each fiscal year, for the succeeding
calendar year, for review and updates of terms and conditions.
3. Scope of Employment. During the Term of Employment, the Employee shall be
employed as an officer of the Company with duties and responsibilities
commensurate with those of President and CEO of Paravant Inc. In addition, the
Employee shall well and faithfully render and perform such other executive and
managerial services, as may be assigned to him, from time to time, by or under
the authority of the Board of Directors of the Company or of any subsidiary or
affiliate of the Company. The Employee's duties and responsibilities must
regularly be performed in Morristown, New Jersey or within a 50-mile radius
thereof. The Employee will devote his full time and efforts to the business and
affairs of the Company, or such subsidiary, or affiliate as now or hereafter
conducted, and shall be at all times subject to the direction and control of the
Board of Directors of the Company or such subsidiary or affiliate. The Employee
shall render such services that are in accordance with his utmost abilities and
shall use his best efforts to promote the interests of the Company and
subsidiaries and affiliates. The Employee will not engage in any capacity or
activity which is, or may be, contrary to the welfare, interest or benefit of
the business now or hereafter conducted by the Company and its subsidiaries and
affiliates.
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4. Compensation. As full compensation for all services provided for herein,
including without limiting the generality of the foregoing, all services to be
rendered by the Employee as an officer or director of the Company or of any
subsidiary or affiliate of the Company, the Company will pay, cause to be paid,
to the Employee, and the Employee will accept, a salary, during the Term of
Employment, at an annual rate of Two Hundred Thousand Dollars ($200,000) to be
paid in regular installments in accordance with the Company's usual paying
practices. Such payments will be subjected to such deductions by the Company as
the Company is from time to time required to make pursuant to law, government
regulations or order or by agreement with, or consent of, the Employee. The
Board of Directors shall have the authority to increase the Employee's salary,
at its discretion from time to time, and the Board of Directors also shall have
the authority to enhance any bonus or other forms of compensation to the
Employee.
5. Expenses. The Employee shall be entitled to reimbursement by the Company for
reasonable expenses actually incurred by him on its behalf in the course of his
employment by the Company, upon the presentation by the Employee, from time to
time, of an itemized account of such expenditures, together with such vouchers
and other receipts as the Company may request.
6. Vacation. The Employee shall be entitled to vacations in accordance with the
Company's prevailing policy for its operating executives.
7. Benefits. The Employee shall be entitled to participate in all group life
insurance, medical and hospitalization plans, and pension, stock option and
profit sharing plans as are presently being offered by the Company or which may
hereafter during the Term of Employment be offered by the Company generally to
its operating executives.
8. Payments on Death or Disability. In the event that the Employee shall die or
become disabled during the Term of Employment or any renewal thereof, the
Company shall pay to his heirs in the case of his death, or to him or his
guardian, in case of his disability, a lump sum payment equal to 12 months of
compensation due to him at that time hereunder or equal monthly installments
covering such 12 months compensation at the discretion of the Employee, his or
her guardian, whatever the case may be. For purposes of this Agreement,
disability of the Employee shall have occurred if (a) the Employee shall become
physically or mentally incapable of properly performing his services to the
Company as provided hereunder excluding infrequent and temporary absences due to
ordinary illnesses, (b) such incapacity shall exist or be reasonably expected to
exist for more than 90 days in the aggregate during any 12 consecutive months
covered hereunder or in any renewals hereof, and (c) either the Employee or the
Company shall have given the other 30 days written notice of his or its
intention to terminate the Employee's active employment by the Company due to
such disability. For purposes of this Agreement, the Employee shall on or
immediately after executing this Agreement provide the Company with a written
list of his heirs in order of preference regarding death payment benefits
hereunder. This list may be altered and changed from time to time by the
Employee by giving written notice of such changes or new list thereof to the
Company as provided herein.
9. Severance. In the event that the Employee's employment with the Company is
terminated thereby without cause, which includes any Company or Board action
contrary to the Employee's scope of employment as set forth in Paragraph 3,
during the Term thereof, the Employee shall be entitled to, as severance
hereunder, one year's full salary, and the Employee shall also be entitled to 12
months
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benefits as provided for and paid out in the manner specified herein.
Termination for cause shall include Employee's failure to perform his duties
hereunder, his conviction of a felony, alcoholism, illegal drug abuse,
violations of corporate or securities laws or similar infractions.
10. Vesting of Benefits, etc. Upon the effective termination date of the
Executive's employment: (a) by the Company without Cause (Paragraph 9), (b) due
to Disability (Paragraph 8), or (c) in the case of Change of Control (Paragraph
15):
(1) The Executive shall become vested immediately in any unvested stock
options (other than incentive stock options under a qualified plan)
that the Executive may have at the time of his termination; and must
exercise all stock options within 90 days of termination or forfeit
either all unexercised options;
(2) To the extent, and only to the extent, that the same is permitted
by law without thereby disqualifying any plan of the Company or an
affiliate that is a qualified plan under the Internal Revenue Code or
that otherwise enjoys or provides tax benefits to employees under the
Internal Revenue Code, the Executive shall become vested immediately in
any and all other benefits under each and every benefit plan of the
Company or any affiliate and in which the Executive, at the time of his
termination, had unvested benefits.
(3) The company will indemnify and defend the Executive in the same
manner and to the same degree as if he was an employee, executive,
officer and director of the Company, for all litigation or other
actions brought against the Executive originating as a result of
association of the Executive with the Company, including but not
limited to all claims, liability, damage, loss, expense, attorneys?
fees, court costs, judgements, settlements, fines, etc.
11. Covenant not to Compete. During the Term of Employment and for a period of
one (1) year after the Term of Employment, the Employee shall not engage,
directly or indirectly, within the United States in any business engaged in the
design, development, manufacture and sale of rugged computers. For the purpose
of this paragraph, the Employee will be deemed, directly or indirectly, engaged
in a business if he participates in such business as proprietor, partner, joint
venturer, stockholder, director, officer, lender, manager, employee, consultant,
advisor or agent or if he otherwise controls such business. The Employee shall
not, for purposes of this paragraph, be deemed stockholder if he holds less than
one (1%) percent of the outstanding shares of any publicly owned corporation
engaged in the same or similar business to that of the Company or any of its
divisions, subsidiaries or affiliates; provided, however, that the Employee
shall not be in a control position with regard to such corporation. In addition,
the Employee shall not be in a control position with regard to such corporation.
In addition, the Employee shall not at any time, during or after the termination
of this Agreement, engage in any business which uses as its name, in whole or in
part, Paravant Inc., or any other name then used by the Company or any of its
affiliates or subsidiaries.
12. Non-Disclosure: Except as may be required by law or with the express
permission of the Company's Board of Directors, the Employee will not at any
time, directly or indirectly, disclose or furnish to any other person, firm or
corporation: (a) the methods of conducting the business of the Company or its
subsidiaries or affiliates; (b) a description of any of the methods of obtaining
business, or manufacturing or advertising products, or of obtaining customers
thereof; and/or (c) any
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confidential information acquired by him during the course of his employment by
the Company, its predecessors, subsidiaries or affiliates, including, without
limiting the generality of the foregoing, the names of any new customers or
prospective customers of, or any person, firm or corporation, who or which have,
or shall have, traded or dealt with (whether such customers have been obtained
by the Employee or otherwise) the Company, its predecessors, subsidiaries or
affiliates.
13. Inventions. As between the Employee and the Company, all products, designs,
styles, processes, discoveries, materials, ideas, creations, inventions and
properties, whether or not furnished by the Employee, created, developed,
invented or used in connection with the Employee's employment hereunder or prior
to this Agreement, will be the sole and absolute property of the Company for any
and all purposes whatever in perpetuity, whether or not conceived, discovered
and/or developed during regular working hours. The Employee will not have, and
will not claim to have, under this Agreement or otherwise, any right, title or
interest of any kind or nature whatsoever in or to any such products, processes,
discoveries, materials ideals, creations, inventions and properties.
14. Arbitration. Any controversy arising out of or relating to this Agreement
shall be resolved by arbitration in the State of Florida pursuant to the rules
of the American Arbitration Association then in effect.
15. Change of Control. In the event of a change in the control of the Company by
virtue of a sale, merger by the Company into, or the combination with, another
corporation or other form of takeover wherein the resulting entity controls
thirty-three percent (33%) or more of the voting stock, and there is more than a
50% change in the composition of the Board, then if the Employee is terminated
without cause, as contemplated in Paragraph 9, during the first one year
following the change of control, the Employee's severance benefits under Section
9 will be increased by 12 months, but in no case will the total severance exceed
2 years base salary. Further, this Employee may voluntarily resign and receive a
total severance of 2 years base salary upon acceptance of a two (2) year
covenant not to compete.
16. Further Instruments. The Employee will execute and deliver all such other
further instruments and documents as may be necessary, in the opinion of the
Company, to carry out the purposes of this Agreement, or to confirm, assign, or
convey to the Company any products, processes, discoveries, materials, ideas,
creations, inventions or properties referred to in Paragraph 12 hereof,
including the execution of all patent applications.
17. Notice. Any written notices required hereunder shall be deemed sufficient if
delivered personally or by certified mail to the Employer at its regular
business office and to the Employee at his home address on file with the
Company.
18. Assignment. A party hereto may not assign this Agreement or any rights or
obligations hereunder, without the consent of the other party hereto. Provided,
however, that upon the sale or transfer of all or substantially all of the
assets of the Company or upon the sale, merger by the Company into, or the
combination with, another corporation or other form of takeover, this Agreement
will (subject to the provisions of Paragraph 2 hereof) inure to the benefits of
and be binding upon the person, firm or corporation purchasing such assets, or
the corporation surviving
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such merger or consolidation or takeover, as the case may be. The provisions of
the Agreement are binding upon the heirs of the Employee and upon the successors
and assigns of the Company hereto.
19. Waiver of Breach. Waiver by either party of a breach of any provision of
this Agreement by the other shall not operate or be constructed as a waiver of
any subsequent breach by such other party.
20. Entire Agreement. This instrument contains the entire agreement of the
parties as to the subject matter hereof. It may not be changed orally, but only
by an agreement in writing signed by the party against whom enforcement of any
waiver, change, modification, extension or discharge is sought.
21. Applicable Law. This Agreement shall be constructed in accordance with the
laws of the State of Florida.
22. Severability. If any provision of this Agreement is held to be invalid or
unenforceable by any court or tribunal of competent jurisdiction, the remainder
of this Agreement shall not be affected by such judgement, and such provision
shall be carried out as nearly as possible according to its original terms and
intent to eliminate such invalidity or unenforceability.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement, as of the
day and year first above written.
PARAVANT INC.
BY:
/s/ Xxxxxxx X. Xxxxx December 7, 2000
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Xxxxxxx X. Xxxxx, Chairman Date
/s/ Xxxxxxx X. Xxxxxx December 7, 2000
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Xxxxxxx X. Xxxxxx, Employee Date
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