EMPLOYMENT AGREEMENT
AGREEMENT,
dated as of November 22, 2006 (the "Effective
Date"),
by
and between Integrated Alarm Services Group, Inc., a Delaware corporation (the
"Company"),
and
Xxxxx X. Xxxx, an individual residing at 000 Xxxxxxxxx Xxxxx, Xxxxxxxxx, XX
00000 (the "Executive").
WHEREAS,
the Company has determined that it is in the best interests of the Company
and
its shareholders to enter into an employment agreement with the Executive,
and
the Executive is willing to serve as an employee of the Company, subject to
the
terms and conditions of this Agreement; and
WHEREAS,
the Company and the Executive entered into an employment agreement, dated as
of
March 1, 2003 (the "Existing
Employment Agreement");
and
WHEREAS,
the Company and the Executive desire to provide for the continued employment
of
the Executive and to supersede the Existing Employment Agreement with this
Agreement;
NOW,
THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Employment
and Duties.
(a) General.
The
Executive shall serve as Executive Vice President of the Company, reporting
to
the Chief Operating Officer (the "COO")
of the
Company. The Executive shall have such duties and responsibilities, commensurate
with the Executive's position, as may be assigned to the Executive from time
to
time by the Board of Directors (the "Board")
or the
COO of the Company. The Executive shall perform any and all duties related
to
his position with the Company and shall be available to confer and consult
with
and advise the officers and directors of the Company at such times as the
Company may require. The Executive's principal place of employment shall be
the
principal offices of the Company currently located in Albany, New York,
provided,
however,
that
the Executive understands and agrees that he will be required to travel from
time to time for business reasons.
(b) Exclusive
Services.
For so
long as the Executive is employed by the Company, the Executive shall devote
his
full-time working time to his duties hereunder, shall faithfully serve the
Company, shall in all respects conform to and comply with the lawful and good
faith directions and instructions given to him by the COO and shall use his
best
efforts to promote and serve the interests of the Company. Further, the
Executive shall not, directly or indirectly, render services to any other person
or organization without the consent of the Company or otherwise engage in
activities that would interfere with the faithful performance of his duties
hereunder.
2. Term
of Employment. The
Executive's employment under this Agreement shall commence as of the Effective
Date and shall terminate on the earlier of (i) the first anniversary of the
Effective Date and (ii) the termination of the Executive's employment under
this Agreement; provided, however, that the term of the Executive's employment
shall be automatically extended without further action of either party for
additional one-year periods
unless
written notice of either party's intention not to extend has been given to
the
other party at least 90 days prior to the expiration of the then effective
Term.
The period from the Effective Date until the termination of the Executive's
employment under this Agreement is referred to as the "Term".
3. Compensation
and Other Benefits. Subject to the provisions of this Agreement, the Company
shall pay and provide the following compensation and other benefits to the
Executive during the Term as compensation for services rendered
hereunder:
(a) Base
Salary.
The
Company shall pay to the Executive a salary (the "Base
Salary")
at the
rate of $170,000 per annum, payable in substantially equal installments at
such
intervals as may be determined by the Company in accordance with its ordinary
payroll practices as established from time to time.
(b) Bonus.
In
addition to the Base Salary, the Executive shall be eligible to earn for each
calendar year ending during the Term an annual incentive bonus (the
“Bonus”)
based
on the achievement of one or more performance goals, targets, measurements
and
other factors (collectively, the “Performance
Goals”)
established for such year by the Compensation Committee of the Board (the
“Committee”).
The
Executive’s target annual bonus (the “Target
Bonus”)
and
the applicable Performance Goals will be established by the Committee within
90
days of the first day of the year to which such Bonus relates. Payment of the
Executive’s Bonus for any year will be based upon the achievement of the
Performance Goals established by the Committee for that year (including, without
limitation, the exercise of the Committee’s negative discretion under Section
162(m) of the Internal Revenue Code of 1986, as amended (the “Code”)).
The
actual bonus paid may be higher or lower than the Target Bonus for over- or
under-achievement of the Performance Goals (including, without limitation,
the
exercise of the Committee’s negative discretion under Section 162(m) of the
Code), as determined by the Committee. Subject to Section 4 hereof, a
Bonus, if any, shall be payable by March 15th
of the
succeeding calendar year or as soon thereafter as may be administratively
practicable.
(c) Savings
and Retirement Plans.
The
Executive shall be entitled to participate in all savings and retirement plans
applicable generally to other senior executives of the Company, in accordance
with the terms of the plans, as may be amended from time to time.
(d) Welfare
Benefit Plans.
The
Executive and/or his family shall be eligible to participate in and shall
receive all benefits under the Company's welfare benefit plans and programs
applicable generally to other senior executives of the Company, in accordance
with the terms of the plans, as may be amended from time to time. The Company
shall include the Executive in its health insurance program available to the
Company's executive officers and shall pay 100% of the premiums for such
program. At
the
Executive's election, the Executive may decline coverage under such health
insurance program and receive from the Company an amount equal to 100% of the
premium for such program, payable at such intervals as may be determined by
the
Company in accordance with its ordinary payroll practices. In the event that
the
Executive elects to decline coverage under such health insurance program as
provided in this Section 3(d), the Company shall have no further obligation
to
provide coverage, pay premiums, or pay claims on behalf of the Executive under
any health insurance arrangement.
2
(e) Expenses.
The
Company shall reimburse the Executive for reasonable travel and other
business-related expenses incurred by the Executive in the fulfillment of his
duties hereunder upon presentation of written documentation thereof, in
accordance with the applicable expense reimbursement policies and procedures
of
the Company as in effect from time to time.
(f) Paid
Time Off.
The
Executive shall be entitled to 22 vacation days and 4 sick/personal days
each year during the Term, which shall be referred to together as "paid time
off." The extent to which unused paid time off from one year shall be carried
forward to any later year shall be governed by the Company's paid time off
policy in effect from time to time. Upon separation of employment, for any
reason, paid time off accrued and not used shall be paid in accordance with
the
Company's paid time off policy then in effect, and the determination of the
amount of paid time off accrued and not used shall be made by the Company in
its
sole discretion pursuant to such policy.
4. Termination
of Employment.
(a) Termination
for Cause; Resignation.
(i) If,
prior to the expiration of the Term, the Company terminates the Executive's
employment for Cause, as defined in Section 4(a)(ii) hereof, or if the
Executive resigns from his employment hereunder, the Executive shall only be
entitled to payment of unpaid Base Salary through and including the date of
termination or resignation and any other amounts or benefits required to be
paid
or provided by law or under any plan, program, policy or practice of the Company
("Other
Accrued Compensation and Benefits").
The
Company shall have no further obligation to compensate the Executive under
any
other provision of this Agreement or any other severance or salary continuation
arrangement of the Company.
(ii)Termination
for "Cause"
shall
mean termination of the Executive's employment because of:
(A) any
act
or omission that constitutes a material breach by the Executive of any of his
obligations under this Agreement;
(B) the
willful and continued failure or refusal of the Executive to satisfactorily
perform the duties reasonably required of him as an employee of the
Company;
(C) the
Executive's conviction of, or plea of nolo
contendere
to,
(1) any felony or (2) another crime involving dishonesty or moral
turpitude or which could reflect negatively upon the Company or any of its
subsidiaries or affiliates (the "Company
Group")
or otherwise impair or impede its operations;
(D) the
Executive's engaging in any misconduct, negligence, act of dishonesty, violence
or threat of violence (including any violation of federal securities laws)
that
is injurious to the Company Group;
3
(E) the
Executive's material breach of a written policy of the Company, the Company's
Code of Ethics, or the rules of any governmental or regulatory body applicable
to the Company;
(F) the
Executive's refusal to follow the lawful and good faith directions of the Board;
(G) the
Executive's engaging in conduct that constitutes activity in competition with
the Company Group; or
(I) any
other
willful misconduct by the Executive which is materially injurious to the
financial condition, business, or reputation of the Company Group.
(b) Termination
without Cause.
(i) If,
prior to the expiration of the Term, the Executive's employment is terminated
by
the Company without Cause, the Company (A) shall pay the Other Accrued
Compensation and Benefits, if any, and (B) shall continue to pay the Executive
the Base Salary at the rate in effect on the date the Executive's employment
is
terminated, for the period remaining in the Term on the date prior to the date
the Executive's employment is terminated, in accordance with the Company's
ordinary payroll practices. The Company shall have no further obligation to
compensate the Executive under Section 4(c) or any other provision of this
Agreement or any other severance or salary continuation arrangement of the
Company.
(ii)The
Company shall not be required to make the payments and provide the benefits
provided for under Section 4(b)(i) unless the Executive executes and
delivers to the Company a release substantially in the form attached as
Exhibit A and the release has become effective and irrevocable in its
entirety.
(iii)If,
following a termination of employment without Cause, the Executive breaches
the
provisions of Sections 5 through 8 hereof, the Executive shall not be
eligible, as of the date of such breach, for the payments described in
Section 4(b)(i), and any and all obligations and agreements of the Company
with respect to such payments shall thereupon cease.
(c) Termination
upon Change in Control.
(i) Upon
a
Change in Control during the Term, the Term shall automatically be extended
for
1 year following the Change in Control.
(ii) In
the
event of the Executive's Involuntary Termination within 12 months after a Change
in Control, provided such Change in Control occurs during the Term, (A) the
Executive shall be eligible to receive a lump sum payment within 30 days of
such
termination equal to one times his Base Salary at the rate in effect immediately
prior to such termination and (B) all stock options and warrants granted by
the
Company to the Executive under any plan prior to such termination shall vest,
accelerate, and become immediately exercisable. The Company shall have no
further obligation to compensate the Executive under Section 4(b)(i) or any
other provision of this Agreement or any other severance or salary continuation
arrangement of the Company. The Company shall not be required to make the
payments and provide the benefits provided for under this Section 4(c)(ii)
unless the Executive executes and delivers to the
4
Company
a
release substantially in the form attached as Exhibit A and the release has
become effective and irrevocable in its entirety.
(iii) "Involuntary
Termination"
shall
mean termination of the Executive's employment by the Company and its
subsidiaries other than for Cause. The Executive shall be deemed to have
incurred an Involuntary Termination if: (A) there is a Change in Control during
the Term; and (B) within 12 months after such Change in Control, (1) the
location of his principal place of employment is moved to a location that is
more than 50 miles from the location of his principal place of employment
immediately prior to such Change in Control, or (2) the Executive's Base Salary
as in effect immediately prior to such Change in Control is reduced by more
than
10%; and (C) he thereafter resigns from employment within 30 days of such change
of location of principal place of employment or such reduction in Base Salary.
Except as provided in this Section 4(c), resignation from employment for any
reason shall not be considered an Involuntary Termination.
(iv) A
"Change
in Control"
shall
occur if:
(A) any
"person" within the meaning of Section 14(d) of the Securities Exchange Act
of
1934, as amended, and any successor provisions thereto is or becomes the
"beneficial owner" (as defined in Rule 13d-3 of the General Rules and
Regulations under the Exchange Act), directly or indirectly, of securities
of
the Company representing 30% or more of the combined voting power of the
Company's then outstanding securities entitled to vote in the election of
directors of the Company;
(B) during
any twelve-month period (not including any period prior to the consummation
of a
Change in Control), individuals who at the beginning of such period constituted
the Board and any new directors, whose election by the Board or nomination
for
election by the Company's stockholders was approved by a vote of at least
one-half of the directors then still in office who either were directors at
the
beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute a majority thereof;
(C) there
occurs a reorganization, merger, consolidation or other corporate transaction
involving the Company (a "Transaction"),
in
each case with respect to which the stockholders of the Company immediately
prior to such Transaction do not, immediately after the Transaction, own more
than 50% of the combined voting power of the Company or another corporation
resulting from such Transaction, in substantially the same proportion of
ownership as prior to such Transaction; or
(D) all
or
substantially all of the assets of the Company are sold, liquidated or
distributed.
(d) Termination
Due to Death or Disability.
The
Executive's employment with the Company shall terminate automatically on the
Executive's death. In the event of the Executive's disability, the Company
shall
be entitled to terminate his employment. In the event of termination of the
Executive's employment by reason of Executive's death or disability, the Company
shall pay to the Executive (or his estate, as applicable) the Executive's Base
Salary through
and including the date of termination. For purposes of this Agreement,
"disability"
shall
have the meaning set forth in the Company's long-term disability
plan.
5
(e) Notice
of Termination.
Any
termination of employment by the Company or the Executive shall be communicated
by a written "Notice
of Termination"
to the
other party hereto given in accordance with Section 22 of this Agreement.
In the event of a termination by the Company for Cause, the Notice of
Termination shall (i) indicate the specific termination provision in this
Agreement relied upon, (ii) set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated and (iii) specify the date of
termination, which date shall not be more than 30 days after the giving of
such notice. The failure by the Company to set forth in the Notice of
Termination any fact or circumstance which contributes to a showing of Cause
shall not waive any right of the Company hereunder or preclude the Company
from
asserting such fact or circumstance in enforcing the Company's rights
hereunder.
(f) Resignation
from Directorships and Officerships.
The
termination of the Executive's employment for any reason will constitute the
Executive's resignation from (i) any director, officer or employee position
the Executive has with the Company and (ii) all fiduciary positions
(including as a trustee) the Executive holds with respect to any employee
benefit plans or trusts established by the Company. The Executive agrees that
this Agreement shall serve as written notice of resignation in this
circumstance; provided,
however,
that
the Executive shall execute such other documents as may be required by the
Company in connection with such resignation.
5. Confidentiality.
(a) Confidential
Information.
(i) The
Executive agrees that he will not at any time, except with the prior written
consent of the Company Group or, to the extent permitted pursuant to subsection
5(a)(ii), as required by law, directly or indirectly, reveal to any person,
entity or other organization (other than any member of the Company Group or
its
respective employees, officers, directors, shareholders or agents) or use for
the Executive's own benefit any information deemed to be confidential by any
member of the Company Group ("Confidential
Information")
relating to the assets, liabilities, employees, goodwill, business or affairs
of
any member of the Company Group, including, without limitation, any information
concerning past, present or prospective customers, manufacturing processes,
marketing data, or other confidential information used by, or useful to, any
member of the Company Group and known to the Executive by reason of the
Executive's employment by, shareholdings in or other association with any member
of the Company Group; provided
that
such Confidential Information does not include any information which is
available to the general public or is generally available within the relevant
business or industry other than as a result of the Executive's action.
Confidential Information may be in any medium or form, including, without
limitation, physical documents, computer files or disks, videotapes, audiotapes,
and oral communications.
(ii)In
the
event that the Executive becomes legally compelled to disclose any Confidential
Information, the Executive shall provide the Company with prompt written notice
so that the Company may seek a protective order or other appropriate remedy.
In
the event that such protective order or other remedy is not obtained, the
Executive shall furnish only that
6
portion
of such Confidential Information or take only such action as is legally required
by binding order and shall exercise his reasonable efforts to obtain reliable
assurance that confidential treatment shall be accorded any such Confidential
Information. The Company shall promptly pay (upon receipt of invoices and any
other documentation as may be requested by the Company) all reasonable expenses
and fees incurred by the Executive, including attorneys' fees, in connection
with his compliance with the immediately preceding sentence.
(b)Confidentiality
of Agreement.
The
Executive agrees that, except as may be required by applicable law or legal
process, during the Term and thereafter, he shall not disclose the terms of
this
Agreement to any person or entity other than the Executive's accountants,
financial advisors, attorneys or spouse, provided
that
such accountants, financial advisors, attorneys and spouse agree not to disclose
the terms of this Agreement to any other person or entity.
(c)Exclusive
Property.
The
Executive confirms that all Confidential Information is and shall remain the
exclusive property of the Company Group. All business records, papers and
documents kept or made by the Executive relating to the business of the Company
Group shall be and remain the property of the Company Group. Upon the request
and at the expense of the Company Group, the Executive shall promptly make
all
disclosures, execute all instruments and papers and perform all acts reasonably
necessary to vest and confirm in the Company Group, fully and completely, all
rights created or contemplated by this Section 5.
6. Noncompetition.
The Executive agrees that, for a period commencing on the Effective Date and
ending one year after termination of employment for any reason (the "Restricted
Period"), the Executive shall not, without the prior written consent of the
Company, directly or indirectly, and whether as principal, investor, employee,
officer, director, manager, partner, consultant, agent or otherwise, alone
or in
association with any other person, firm, corporation or other business
organization, carry on a Competing Business (as hereinafter defined) in any
geographic area in which the Company Group has engaged in a Competing Business
(including, without limitation, any area in which any customer of the Company
Group may be located). For purposes of this Section 6, carrying on a
"Competing Business" means to engage in the business of wholesale monitoring
and
related support services, financing solutions and products within the security
alarm industry, and any other business engaged in by the Company within 12
months after termination of employment; provided, however, that nothing herein
shall limit the Executive's right to own not more than 1% of any of the debt
or
equity securities of any business organization that is then filing reports
with
the Securities and Exchange Commission pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934, as amended. In the event the Executive
is
employed at will by the Company Group for any period after the end of the Term,
this Section 6 shall remain effective until the first anniversary of the date
of
the Executive's termination of employment.
7. Non-Solicitation.
The Executive agrees that, during the Restricted Period, the Executive shall
not, directly or indirectly, (a) interfere with or attempt to interfere
with the relationship between any person who is, or was during the then most
recent three-month period, an employee, officer, representative or agent of
the
Company Group and any member of the Company Group, or solicit, induce or attempt
to solicit or induce any of them to leave the
7
employ
of
any member of the Company Group or violate the terms of their respective
contracts, or any employment arrangements, with such entities or (b) induce
or attempt to induce any customer, client, supplier, licensee or other business
relation of any member of the Company Group to cease doing business with any
member of the Company Group, or in any way interfere with the relationship
between any member of the Company Group and any customer, client, supplier,
licensee or other business relation of any member of the Company Group. As
used
herein, the term "indirectly" shall include, without limitation, the Executive's
permitting the use of the Executive's name by any competitor of any member
of
the Company Group to induce or interfere with any employee or business
relationship of any member of the Company Group.
8. Assignment
of Developments.
(a) During
the Executive’s employment, all Developments that are at any time made, reduced
to practice, conceived or suggested by him, whether acting alone or in
conjunction with others, shall be the sole and absolute property of the Company,
free of any reserved or other rights of any kind on his part, and the Executive
hereby irrevocably assigns, conveys and transfers any and all right, title
and
interest that he may have in such Developments to the Company Group. If such
Developments were made, conceived or suggested by the Executive during or as
a
result of his employment relationship with the Company Group, the Executive
shall promptly make full disclosure of any such Developments to the Company
and,
at the Company’s cost and expense, do all acts and things (including, among
others, the execution and delivery under oath of patent and copyright
applications and instruments of assignment) deemed by the Company to be
necessary or desirable at any time in order to effect the full assignment to
the
Company of his right, title and interest, if any, to such Developments. The
Executive acknowledges and agrees that any invention, concept, design or
discovery that concretely relates to or is associated with the Executive’s work
for the Company Group that is described in a patent application or is disclosed
to a third party directly or indirectly by the Executive during the Restricted
Period shall be the property of and owned by the Company, and such disclosure
by
patent application (except by way of a patent application filed by any member
of
the Company Group) or otherwise shall constitute a breach of Section 6
above.
“Developments”
shall
mean all data, discoveries, findings, reports, designs, inventions,
improvements, methods, practices, techniques, developments, programs, concepts
and ideas, whether or not patentable, relating to the present or planned
activities, or the products and services of the Company Group.
(b) If
a
patent application or copyright registration is filed by the Executive or on
the
Executive's behalf during the Executive's employment with the Company or within
1 year after the Executive's leaving the Company's employ describing a
Development within the scope of the Executive's work for the Company or which
otherwise relates to a portion of the business of the Company of which the
Executive had knowledge during the Executive's employment with the Company,
it
is to be conclusively presumed that the Development was conceived by the
Executive during the period of such employment.
8
9. Certain
Remedies.
(a) Forfeiture/Payment
Obligations.
In the
event the Executive fails to comply with Sections 5 through 8, other than any
isolated, insubstantial and inadvertent failure that is not in bad faith, the
Executive agrees that he will:
(i) forfeit
any amounts not already paid and repay to the Company any amounts already paid
pursuant to Section 4(b) or 4(c) of the Agreement;
(ii) forfeit
all options, restricted stock and other equity based compensation awarded by
the
Company Group that have not vested or been exercised (in the case of options
or
awards with features similar to exercise) at the date of a determination by
the
Company that the Executive failed to comply with Sections 5 through 8 of the
Agreement; and
(iii) pay
to
the Company Group the amount of all gain that the Executive realized within
the
12 months before the date of a determination by the Company that the
Executive failed to comply with Sections 5 through 8 from the exercise or
vesting of any stock options, restricted stock or other equity based
compensation awarded by the Company Group.
(b) Time
for Payment.
The
Executive will pay to the Company amounts due under Section 9(a) within 10
days
of a determination by the Company that the Executive failed to comply with
Sections 5 through 8 of the Agreement. The obligations under Section 9(a) are
full recourse obligations.
(c) Injunctive
Relief.
Without
intending to limit the remedies available to the Company Group, including,
but
not limited to, those set forth in this Section 9, the Executive agrees
that a breach of any of the covenants contained in Sections 5 through 8 of
this
Agreement may result in material and irreparable injury to the Company Group
for
which there is no adequate remedy at law, that it will not be possible to
measure damages for such injuries precisely and that, in the event of such
a
breach or threat thereof, any member of the Company Group shall be entitled
to
seek a temporary restraining order or a preliminary or permanent injunction,
or
both, without bond or other security, restraining the Executive from engaging
in
activities prohibited by the covenants contained in Sections 5 through 8 of
this
Agreement or such other relief as may be required specifically to enforce any
of
the covenants contained in this Agreement. Such injunctive relief in any court
shall be available to the Company Group in lieu of, or prior to or pending
determination in, any arbitration proceeding.
(d) Extension
of Restricted Period.
In
addition to the remedies the Company may seek and obtain pursuant to this
Section 9, the Restricted Period shall be extended by any and all periods
during which the Executive shall be found by a court possessing personal
jurisdiction over him to have been in violation of the covenants contained
in
Sections 5 through 8 of this Agreement.
10. Defense
of Claims. The Executive agrees that, during the Term and for a period of
two years after termination of the Executive's employment, upon request from
the
Company, the Executive will cooperate with the Company in the defense of any
claims or
9
actions
that may be made by or against the Company that affect the Executive's prior
areas of responsibility, except if the Executive's reasonable interests are
adverse to the Company in such claim or action. The Company agrees to promptly
reimburse the Executive for all of the Executive's reasonable travel and other
direct expenses incurred, or to be reasonably incurred, to comply with the
Executive's obligations under this Section 10.
11. Nondisparagement. The
Executive agrees that at no time during his employment by the Company or
thereafter shall he make, or cause or assist any other person to make, any
statement or other communication to any third party which impugns or attacks,
or
is otherwise critical of, the reputation, business or character of any member
of
the Company Group or any of its respective directors, officers or employees.
12. Periods
Following the Term.
For the
avoidance of doubt, the provisions of Sections 5 through 11 shall continue
in
effect following the expiration of the Term, including, without limitation,
during any period that the Executive remains an employee-at-will of the
Company.
13. Source
of Payments. All
payments provided under this Agreement, other than payments made pursuant to
a
plan which provides otherwise, shall be paid in cash from the general funds
of
the Company, and no special or separate fund shall be established, and no other
segregation of assets shall be made, to assure payment. The Executive shall
have
no right, title or interest whatsoever in or to any investments which the
Company may make to aid the Company in meeting its obligations hereunder. To
the
extent that any person acquires a right to receive payments from the Company
hereunder, such right shall be no greater than the right of an unsecured
creditor of the Company.
14. Nonassignability;
Binding Agreement.
(a) By
the
Executive.
This
Agreement and any and all rights, duties, obligations or interests hereunder
shall not be assignable or delegable by the Executive.
(b) By
the
Company.
This
Agreement and all of the Company's rights and obligations hereunder shall not
be
assignable by the Company except as incident to a reorganization, merger,
consolidation, or transfer of all or substantially all of the Company's
assets.
(c) Binding
Effect.
This
Agreement shall be binding upon, and inure to the benefit of, the parties
hereto, any successors to or assigns of the Company and the Executive's heirs
and the personal representatives of the Executive's estate.
15. Withholding.
Any payments made or benefits provided to the Executive under this Agreement
shall be reduced by any applicable withholding taxes or other amounts required
to be withheld by law or contract.
16. Amendment;
Waiver. This Agreement may not be modified, amended or waived in any manner,
except by an instrument in writing signed by both parties hereto. The waiver
by
either party of compliance with any provision of this Agreement by the other
party
10
shall
not
operate or be construed as a waiver of any other provision of this Agreement,
or
of any subsequent breach by such party of a provision of this
Agreement.
17. Governing
Law. All matters affecting this Agreement, including the validity thereof,
are to be governed by, and interpreted and construed in accordance with, the
laws of the State of New York applicable to contracts executed in and to be
performed in that State.
18. Entire
Agreement; Supersedes Previous Agreements. This Agreement contains the
entire agreement and understanding of the parties hereto with respect to the
matters covered herein including, without limitation, the Existing Employment
Agreement, and supersedes all prior or contemporaneous negotiations,
commitments, agreements and writings with respect to the subject matter hereof,
all such other negotiations, commitments, agreements and writings shall have
no
further force or effect, and the parties to any such other negotiations,
commitments, agreements or writings shall have no further rights or obligations
thereunder.
19. Counterparts.
This Agreement may be executed by either of the parties hereto in counterparts,
each of which shall be deemed to be an original, but all such counterparts
shall
together constitute one and the same instrument.
20. Headings.
The headings of sections herein are included solely for convenience of reference
and shall not control the meaning or interpretation of any of the provisions
of
this Agreement.
21. Section
409A Compliance.
If any
provision of this Agreement would, in the reasonable, good faith judgment of
the
Company, result or likely result in the imposition on the Executive or any
other
person of a penalty tax under Section 409A of the Code, the Company may
reform this Agreement or any provision hereof, without the Executive’s consent,
in the manner that the Company reasonably and in good faith determines to be
necessary or advisable to avoid the imposition of such penalty tax (hereinafter
“Section 409A
Compliance”);
provided,
however,
that
any such reformation shall, to the maximum extent the Company reasonably and
in
good faith determines to be possible, retain the economic and tax benefits
to
the Executive hereunder while not materially increasing the cost to the Company
of providing such benefits to the Executive. Except as provided for in the
preceding sentence, the provisions of this Agreement may not be amended,
supplemented, waived or changed orally, but only by a writing signed by the
party as to whom enforcement of any such amendment, supplement, waiver or
modification is sought and making specific reference to this
Agreement.
22. Notices.
All notices or communications hereunder shall be in writing (including
electronic transmission) and shall be (as elected by the person giving the
notice) hand delivered by messenger or courier service, electronically
transmitted, or mailed by registered or certified mail (postage prepaid), return
receipt requested, addressed as follows:
11
|
To
the Company:
Integrated
Alarm Services Group, Inc.
00
Xxxx Xxxxxx, 0xx Xxxxx
Xxxxxx,
XX 00000
Attention:
Xxxxxxx X. May
Phone:
000-000-0000
Fax:
000-000-0000
With
a copy to:
Shearman
& Sterling LLP
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx, XX 00000
Attention:
Xxxxxxx X. Xxxxxxxxxx
Phone:
000-000-0000
Fax:
000-000-0000
|
To
the Executive:
Xxxxx
X. Xxxx
000
Xxxxxxxxx Xxxxx
Xxxxxxxxx,
XX 00000
Phone:
000-000-0000
|
All
such
notices shall be conclusively deemed to be received and shall be effective
(a) on the date delivered if by personal delivery; or (b) on the date
of transmission with confirmed answer back if by electronic transmission; or
(c)
on the date the return receipt is signed or delivery is refused or the date
the
notice is designated by the postal authorities as not deliverable, as the case
may be, if mailed.
12
IN
WITNESS WHEREOF, the Company has caused this Agreement to be signed by its
officer pursuant to the authority of its Board, and the Executive has executed
this Agreement, as of the day and year first written above.
By:
/s/
Xxxxxxx X. May
Name:
Xxxxxxx X. May
Title: Chief
Executive Officer
THE
EXECUTIVE
/s/
Xxxxx X.
Xxxx
Xxxxx
X. Xxxx
13
EXHIBIT
A
RELEASE
OF CLAIMS
I,
Xxxxx
X. Xxxx, the undersigned, and Integrated Alarm Services Group, Inc. (the
"Company")
entered into an Employment Agreement, dated November 22, 2006, ("Agreement")
and
this Release of Claims is being delivered to the Company in consideration of
amounts payable to me under the Agreement to which I am not otherwise entitled.
I
agree
that this Release of Claims becomes effective seven (7) days after I sign it,
unless, prior to the end of that 7-day period, I have revoked this Release
of
Claims in the manner described below.
1.
General
Release. In consideration of the promises of the Company set forth in the
Agreement, which includes compensation to which I would not otherwise be
entitled, I, on behalf of myself, and my heirs, executors, administrators,
successors, assigns, dependents, descendants and attorneys hereby knowingly,
voluntarily, and willingly fully and forever release, discharge, and covenant
not to xxx the Company and its direct and indirect parents, subsidiaries,
affiliates, and related companies, past and present, as well as each of its
and
their directors, officers, employees, agents of the foregoing, representatives,
advisers, trustees, insurers, assigns, successors, and agents, past and present
(collectively, hereinafter referred to as the "Released Parties"), of, from,
and
with respect to any claim, duty, obligation, or cause of action relating to
any
matters of any kind, whether presently known or unknown, suspected or
unsuspected, that any of them may possess arising from any omissions, acts,
or
facts that have occurred up until and including the date of this Release of
Claims including:
| · |
any
and all claims relating to or arising from my employment relationship
with
the Company and the termination of either such relationship;
|
| · |
any
and all claims for wrongful discharge of employment; breach of contract,
both express and implied; breach of a covenant of good faith and
fair
dealing, both express and implied; negligent or intentional infliction
of
emotional distress; negligent or intentional misrepresentation; negligent
or intentional interference with contract or prospective economic
advantage; and defamation;
|
| · |
any
and all claims arising under the Employee Retirement Income Security
Act
of 1974, the Civil Rights Acts of 1866 and 1867, Title VII of the
Civil
Rights Act of 1964, as amended, the Civil Rights and Women's Equity
Act of
1991, Sections 1981 through 1988 of Title 42 of the United States
Code, as
amended, the Occupational Safety and Health Act of 1970, the Consolidated
Omnibus Budget Reconciliation Act of 1985, the Family and Medical
Leave
Act of 1993, the Worker Adjustment and Retraining Notification Act
of
1988, the Vocational Rehabilitation Act of 1973, the Equal Pay Act
of
1963, the Americans with Disabilities Act, the Fair Labor Standards
Act,
and the National Labor Relations Act, as amended, any other federal
or
state anti-discrimination law, or any local or municipal ordinance
relating to discrimination in employment or human rights and the
common
law;
|
A-1
| · |
any
and all claims for salary, bonus, severance pay, pension, paid time
off
pay, life insurance, health or medical insurance, or any other fringe
benefits, other than the payments and benefits provided for in the
Agreement;
|
| · |
any
and all claims arising out of any other laws and regulations relating
to
employment or employment discrimination; and
|
| · |
any
and all claims for attorneys' fees and
costs.
|
2. ADEA
Release.
In
consideration of the promises of the Company set forth in the Agreement, I
hereby release and discharge the Released Parties from any and all claims that
I
may have against the Released Parties arising under the U.S. Age Discrimination
in Employment Act of 1967, as amended, and the applicable rules and regulations
promulgated thereunder ("ADEA").
I
understand that the ADEA is a federal statute that prohibits discrimination
on
the basis of age in employment, benefits, and benefit plans. I also understand
that, by signing this Release of Claims, I am waiving all claims against any
and
all of the Released Parties.
3. Representations
by Me.
By
signing this Release of Claims, I confirm the following:
| · |
I
am providing the release and discharge set forth in this Release
of Claims
in exchange for consideration in addition to anything of value to
which I
am already entitled.
|
| · |
I
was advised by the Company in writing to consult with an attorney
of my
choice prior to signing this Release of Claims and to have such attorney
explain to me the terms of the Agreement and the Release of Claims
including the terms relating to my release of claims arising under
the
ADEA.
|
| · |
I
have read the Agreement and this Release of Claims carefully and
completely and understand each of
them.
|
| · |
I
understand that I am not waiving any rights or claims provided under
ADEA
that may arise after I sign this Release of
Claims.
|
4.Period
to Consider and Revocation. I understand that I have twenty-one days in
which to consider the terms of the Agreement and this Release of Claims. To
the
extent I sign the Agreement and this Release of Claims within less than
twenty-one (21) days after its delivery to me, I acknowledge that my decision
to
execute the Agreement and this Release of Claims prior to the expiration of
such
twenty-one (21)-day period was entirely voluntary. For a period of seven days
following the date I execute this Release of Claims, I have
A-2
the
right
to revoke the release contained in Section 2 (the "Revocation Period"). The
Revocation Period shall expire at 5:00 p.m. New York City time on the last
day
of the Revocation Period; provided, however, that, if such seventh day is not
a
business day, the Revocation Period shall extend to 5:00 p.m. on the next
succeeding business day. No such revocation by me shall be effective unless
it
is in writing and signed by me and received by the Company prior to the
expiration of the Revocation Period.
5.
Rights
Not Released.
I
understand that, notwithstanding any of the foregoing, by signing this Release
of Claims, I shall not release the Company from any of the indemnity rights
I
may have against the Company under its By-Laws or under the laws of the State
of
Delaware, or from any of the rights I may have against the Company pursuant
to
the Agreement.
________________________
Xxxxx
X.
Xxxx
DATE:
______________
STATE
OF: )
)
ss:
COUNTY
OF )
On
this
____ day of ________, 2006, before me personally came ___________________ to
me
known, and known to me to be the individual described in, and who executed
the
foregoing letter and duly acknowledged to me that he/she executed the
same.
__________________
NOTARY
PUBLIC
A-3
