Exhibit 10.13
Diversified Security Solutions, Inc.
000 Xxxxxxx Xxxxxx
Xxxxxx Xxxxx, XX 00000
(000) 000-0000
Fax: (000) 000-0000
August 8, 2003
Xx. Xxxxxxxxx Xxxxxxxx
00 Xxxxxxxxx Xxxx
Xx Xxxxxx, Xxx Xxxx 00000
Xx. Xxxxxxxx:
You and Diversified Security Solutions, Inc. (the "Company") are parties to
an employment agreement dated August 13, 2002 (the "Employment Agreement"). The
Company and you desire to terminate the Employment Agreement and to vary the
terms and conditions applicable to a termination of the Employment Agreement
without cause, and to make provision for a continued business relationship
between the Company and you notwithstanding the termination of the Employment
Agreement. In consideration of the promises and the mutual covenants herein
contained, we agree as follows:
1. Contract Termination Agreement. In consideration of the Company's entering
into a Consulting Agreement with Protective Countermeasures & Consulting
("PCC"), dated the date hereof (the "Consulting Agreement") and making
payments pursuant to the Consulting Agreement consistent with the terms and
conditions of this agreement, Xx. Xxxxxxxx agrees to the termination of the
Employment Agreement and the waiver of his rights pursuant to the
Employment Agreement, including a severance payment of two year's full
compensation upon termination of the Employment Agreement without cause.
2. Effective Date of Contract Termination. Subject to the Company's making the
payments required under the Consulting Agreement, the Employment Agreement
is of no further force and effect, and is terminated effective August 8,
2003.
3. Consulting Agreement. Subject to the deduction provided for in paragraph 8
hereof and in consideration of entering into this Agreement and in order to
enable the parties to work together in the future, the parties are entering
into the Consulting Agreement pursuant to which the Company shall make
Twelve (12) equal monthly installments of twelve Thousand, Five Hundred
Dollars ($12,500) less the deduction provided for in paragraph 8 of 12
equal monthly payments of $1,055 to PCC ("Consulting Payment"). Each
Consulting Payment shall be made at 00 Xxxx Xxx Xxx Xxxx, Xxxxx Xxxxxx Xxx
Xxxx
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10604, or by direct deposit to a bank account by written agreement of
the Company and Xx. Xxxxxxxx. The first Consulting Payment installment
shall be sent to Xx. Xxxxxxxx by Federal Express eight (8) days after he
executes this Agreement. Each installment payable thereafter shall be made
on or before the 30th day of each month until payment of the Consulting
Payment is complete. The Company shall pay a late fee equal to five percent
(5%) of each monthly installment of the Consulting Payment not received by
Protective Countermeasures & Consulting, Inc. within ten business days of
the date upon which it is due.
4. Resignation of Officer and Director Positions. Upon the execution of this
Agreement by the Company and Xx. Xxxxxxxx, Xx. Xxxxxxxx shall resign from
his positions as Executive Vice President of the Company, and as President
of the Technical Services Division, and as a director of the Company
effective as of August 8, 2003. Xx. Xxxxxxxx agrees to execute and deliver
to the Company such other documents as may be necessary to effect or
reflect such resignations.
5. Stock Option Agreement. Subject to the receipt of the final Consulting
Payment, the Stock Option Agreement, dated August 13, 2002, between the
Company and Xx. Xxxxxxxx is of no further force and effect, and is
terminated effective August 8, 2003, and any stock options granted there
under are void.
6. Vacation Pay. It is agreed that Xx. Xxxxxxxx has ten (10) unused vacation
days. In exchange for his foregoing said vacation days the Company issued
him check number 1793 in the amount of $3,894.53. Xx. Xxxxxxxx hereby
acknowledges receipt of this check.
7. Company Equipment. Xx. Xxxxxxxx agrees upon the execution of this Agreement
to return all equipment, files, documents, credit cards, and any other
property belonging to the Company. Xx. Xxxxxxxx has in his possession the
following items of Company Equipment:
(a) A Lincoln Continental four door sedan (the "Leased Vehicle") with
approximately 15,800 miles indicated on the odometer;
(b) A Company Bank Credit MasterCard issued by Xxxxxx United Bank
numbered 0000000000000000 with an August, 2004 expiration date;
(c) An American Express Card numbered #000000000000000 with an expiration
date of April, 2005;and
(d) The Sweeps computer system accessories consisting of a MDC (microwave
down converter) antenna and a CPM - 700 broadband receiver kit.
8. Sweeps Payment. Notwithstanding Xx. Xxxxxxxx'x obligation to return Company
equipment set forth above, Xx. Xxxxxxxx shall retain the Sweeps computer
system accessories purchased by the Company in consideration of a payment
in the amount of $12,660 (the "Sweeps Payment"). The Sweeps Payment shall
be deducted in equal amounts of $1,055 from each Consulting Payment. Xx.
Xxxxxxxx acknowledges that the Sweeps computer system accessories were
purchased by the Company, and are in his possession.
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9. Returned Equipment. Xx. Xxxxxxxx represents that no personal charges are
outstanding and due on either the Xxxxxx United Bank Mastercard, or the
American Express Card issued by the Company, and that he has maintained the
Leased Vehicle in good condition. The Company may accept the return of the
Leased Vehicle upon a written assessment that the Leased Vehicle is in good
condition upon the execution of this Agreement, or have the lessor of the
Leased Vehicle inspect it to determine its condition prior to the execution
of this Agreement.
10. Traps Software. It is hereby agreed that the Company will retain the threat
assessment software (the "Traps" software).
11. Collection of Receivables. Xx. Xxxxxxxx shall assist the Company, as
needed, in the collection of receivables invoiced by the Company's
Technical Services Division to Vornado Realty Trust prior to the date of
this Agreement. Two such invoices are outstanding in the approximate
amounts of Twenty Thousand Dollars ($20,000) and Eight Thousand Dollars
($8,000). Xx. Xxxxxxxx acknowledges that the Company has the sole and
exclusive right to the payment of amounts due on these invoices.
12. Non-Competition. Xx. Xxxxxxxx agrees not to engage directly or indirectly
within the United States, in any business engaged in the design,
development, manufacture, installation and sale of security equipment
currently manufactured or installed by the Company, or developed during Xx.
Xxxxxxxx'x employment with the Company for a period of one year from the
date of this Agreement. Xx. Xxxxxxxx shall be deemed directly or indirectly
engaged in a competing business, if he engages in a business designing,
developing, manufacturing, installing and selling such security equipment
as a proprietor, partner, joint venturer, stockholder, director, officer,
lender, manager, employee, consultant, advisor, or agent or if he otherwise
controls such business. For purposes of this paragraph, any business
engaged in by Xx. Xxxxxxxx to provide security consulting, crisis and
consequence management, threat and vulnerability assessment determination,
technical surveillance countermeasure evaluation, voice stress analysis
examination, risk assessment and psychological profiling shall not be
deemed a competing business ("Security Consulting Services"). Without
limiting the generality of the foregoing, and other than for the sole
purpose of providing Security Consulting Services as defined in this
Paragraph, Xx. Xxxxxxxx agrees that for one year from the date hereof, he
will not directly or indirectly whether for himself or for any other person
and whether as a proprietor, principal, partner, joint venturer,
stockholder, director, officer, lender, manager, employee, consultant,
advisor, agent, independent contractor or in any other capacity: (i)
solicit any business from the Port Authority of New York and New Jersey,
Entergy, the New York City Metropolitan Transportation Authority, and/or
the New Jersey Transit Authority or (ii) hire in any capacity, including
but not limited to as an employee, advisor or consultant, any person who
was an employee of the Company or any subsidiary of the Company within the
three year period prior to the date hereof.
13. Use of Business Name. Xx. Xxxxxxxx agrees not to engage in any business
which uses as its name, in whole or in part, "Diversified Security
Solutions, Inc. or DSSI", "DVS", "Xxxxx Bros.", "Viscom", "HBE" or any name
presently in use by the Company, or its affiliates or subsidiaries.
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14. Nondisclosure of Confidential Information. Except as may be required by law
or with the express written permission of the Company in each instance, Xx.
Xxxxxxxx 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 and affiliates;
(b) a description of any of the methods of obtaining business, installing
or manufacturing or advertising security products, or of obtaining
customers thereof; and/or
(c) any confidential information acquired during the course of Xx.
Xxxxxxxx'x employment with the Company, it predecessors, subsidiaries
or affiliates, including, without limiting the generality of the
foregoing, the names of any customers prospective customer 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 Xx.
Xxxxxxxx or otherwise) the Company, its predecessors, subsidiaries or
affiliates
This paragraph 14 will survive the termination of this Agreement.
15. Severability; Injunctive Relief. Xx. Xxxxxxxx agrees that paragraphs Twelve
(12), Thirteen (13), and Fourteen (14) are reasonable and necessary for the
protection of the Company; that each such paragraph, and the period or
periods of time, geographical areas and types and scopes of restrictions on
his activities specified therein, are and are intended to be divisible;
that if any portion thereof (including any sentence, clause or part) shall
be held contrary to law or invalid or unenforceable in any respect in any
jurisdiction, or as to any one or more period of time, areas or business
activities, or any part thereof, the remaining provisions shall not be
affected but shall remain in full force and effect as to the other and
remaining parts; and that any such invalid or unenforceable provision shall
be deemed, without further action on the part of the parties hereto,
modified, amended and limited to the extent necessary to render the same
valid and enforceable in such jurisdiction. Xx. Xxxxxxxx further recognizes
and agrees that any violation of his agreements set forth in these
paragraphs would cause such damages to the Company as would be irreparable
and the exact amount of which would be impossible to ascertain and that,
for such reason, among others, the Company shall be entitled, as a matter
of course, to injunctive relief from any court of competent jurisdiction
restraining any further violation. Such right to injunctive relief shall be
cumulative and in addition to and not in limitation of other rights and
remedies which the Company may possess.
16. Cooperation. The Company and Xx. Xxxxxxxx acknowledge and agree that they
desire to cooperate with and support each other in the marketing and
delivery of business services after the termination of the Employment
Agreement, and have entered into the Consulting Agreement in furtherance of
this objective.
17. Inventions. As between Xx. Xxxxxxxx and the Company, all products, designs,
styles, processes, discoveries, materials, ideas, creations, inventions and
properties, whether or
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not furnished by Xx. Xxxxxxxx or created, developed, invented or used in
connection with his employment with the Company 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. Xx. Xxxxxxxx will not have, and will not claim to
have, under this Agreement or otherwise, any right, title or interested of
any kind or nature whatsoever in or to any such products, processes,
discoveries, materials, ideas creations, inventions and properties.
18. Prohibited Statements. Neither the Company nor Xx. Xxxxxxxx shall make,
publish or state, or cause to be made, published or stated, any defamatory
or disparaging statement, writing or communication pertaining to the
character, reputation, business practices competence or conduct of the
other, their subsidiaries, shareholders, directors, officers, employees,
agents, representatives or successors.
19. Rights and Remedies in the Event of Certain Breaches. The Company may
terminate payment of Consulting Payment if Xx. Xxxxxxxx materially violates
his obligations under the above paragraphs entitled "Non-Competition,"
"Confidentiality and Nondisclosure," "Inventions," "Collection of
Receivables," and "Prohibited Statements". Any controversy regarding
whether a material breach of these obligations has occurred shall be
resolved by arbitration in the City of New York pursuant to the rules of
the American Arbitration Association then in effect.
20. Press Release. Upon the execution of this Agreement by the Company and Xx.
Xxxxxxxx, the Company may issue a press release announcing an agreement to
terminate the Employment Agreement and Xx. Xxxxxxxx'x resignation from his
positions with the Company and its affiliates, and his resignation as a
member of the Company's board of directors. The press release shall state
that this agreement is a mutual agreement and that the Parties intend to
continue a business relationship with each other. Xx. Xxxxxxxx shall be
provided with an opportunity to review and comment upon the press release
before its publication.
21. Release of All Claims. In consideration of the Company's agreement to enter
into the Consulting Agreement and to pay the Consulting Payment, and the
actual receipt thereof and other good and valuable consideration provided
to Xx. Xxxxxxxx under this Agreement, he does hereby, for himself, his
heirs, executors, administrators and assigns, release and agree to
indemnify and hold harmless Releasee, as hereinafter defined, from any and
all claims, charges, complaints, damages, or causes of action, now
existing, both known and unknown, of every name and nature, including but
not limited to all claims of breach of contract or misrepresentation,
wrongful discharge, or arising from alleged violations of Title VII of the
Civil Rights Act of 1964, the Civil Rights Act of 1991, the Age
Discrimination in Employment Act, the Older Workers Benefits Protection
Act, the Americans with Disabilities Act, the Fair Labor Standards Act, the
Equal Pay Act, the Employee Retirement Income Security Act of 1974, the
Family and Medical Leave Act of 1993, or any other local, state or federal
law, regulation or policy or any other claim relating to or arising out of
his employment with the Company or the termination thereof, with the sole
exception of any rights Xx. Xxxxxxxx may have under the Workers'
Compensation Act. The term "Releasee" as used in this paragraph shall be
defined to
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include: Diversified, its corporate affiliates, including but not limited
to Xxxxx Bros. Electronics, Inc., and each of its present and former
shareholders, directors, officers, agents, employees, and successors.
22. Cooperation and Assistance. Xx. Xxxxxxxx agrees to make himself reasonably
available to the Company to respond to reasonable requests by the Company
for information concerning matters involving facts or events, relating to
the Company or any of the Company's subsidiaries or affiliates, that may be
within his knowledge, and to cooperate with and assist the Company and any
subsidiary or affiliate as reasonably requested with respect to any pending
and future litigation, arbitration or other dispute resolution relating to
any matter in which he was involved during his employment with the Company.
The Company will advance Xx. Xxxxxxxx his reasonable travel expenses and
other costs that must be incurred to provide his cooperation and assistance
under this paragraph. The Company shall pay Xx. Xxxxxxxx reasonable fees
for any time spent providing such assistance in respect to litigation,
arbitration or other dispute resolution arising out activities or events in
which Xx. Xxxxxxxx had no direct involvement, and which arise out of
activities or events that occur after the effective date of this Agreement
23. Indemnification. In the event such liability is not covered by insurance,
the Company shall indemnify Xx. Xxxxxxxx against liability incurred for
acts or omissions within the scope of his duties undertaken by him in good
faith as an employee, officer or member of the Board of Directors of the
Company, or any of its affiliates and subsidiaries from August 13, 2002
until August 11, 2003, and shall pay attorneys fees and costs associated
with litigation arising out of such acts or omissions, provided however,
the indemnification and/or payments provided for in this sentence shall not
exceed Fifty Thousand Dollars ($50,000). The Company has also provided Xx.
Xxxxxxxx with a Declaration page of its Directors' and officers' liability
insurance for the period from November 16, 2002 to November 2003.
24. Headings. Headings of the various provisions used herein are for
convenience of reference only and shall not alter the meaning of the
provisions.
25. Severability. Should any of the provisions of this Agreement be declared or
determined by any court to be illegal or invalid, the validity of the
remaining parts, terms or provisions shall not be affected thereby.
26. Governing Law and Venue. This Agreement shall be governed by and construed
in accordance with the laws of the State of New Jersey without giving
effect to the conflicts of laws principles thereof. Any action brought in
connection with this Agreement shall be brought in the federal or state
courts located in the State of New Jersey, and the parties hereto hereby
irrevocably consent to the jurisdiction of such courts. The parties each
hereby further agree to accept and acknowledge service of any and all
process which may be served in any suit, action or proceeding in the State
or federal courts of the State of New Jersey, and agree that service of
process upon a party hereto mailed by certified mail to party's address
shall be deemed in every respect effective service of process upon such in
any such suit, action or proceeding.
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You have twenty-one (21) days from the date you receive this Agreement
within which to consider its terms. During this period you should consult with
an attorney regarding the terms of this Agreement. In the event you desire to
execute this Agreement prior to the end of such period, you shall also execute
and provide to the Company the endorsement attached hereto.
Your signature below indicates that you are entering into this Agreement
freely, knowingly and voluntarily with a full understanding of its terms.
Further, the terms of this Agreement cannot become effective or enforceable
until seven (7) days following the date of its execution by you during which
time you may revoke this Agreement by notifying the Company in writing.
DIVERSIFIED SECURITY SOLUTIONS, INC.
By:
-------------------------------------
Xxxxx Xxxxxxxx
President and Chief Operating Officer
Agreed and Accepted by:
---------------------------
Xxxxxxxxx Xxxxxxxx
, 2003
----------------
STATE OF )
COUNTY OF ) ss.:
On 2003, before me personally came to me known
to be the same person described in and who executed the forgoing Agreement and
Release and duly acknowledged to me that they executed the same.
ENDORSEMENT
I, Xxxxxxxxx Xxxxxxxx hereby acknowledge that I have been advised that I
have 21 days in which to consider the forgoing Agreement by and between my self
and Diversified Security Solutions, Inc. dated as of August 8, 2003 and
voluntarily chose to sign the Agreement prior to the expiration of the 21-day
period.
I declare under penalty of perjury under the laws of the State of
that the foregoing is true and correct.
EXECUTED this day of , 2003 at .
--------------------------------
Xxxxxxxxx Xxxxxxxx
