EXHIBIT 10.1
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (this "Agreement") made as of the 24th day of May,
2005 by and between Ret. Gen. Xxxxx Xxxxx ("Executive") and DHB Industries,
Inc., a Delaware corproation (the "Company").
[BACKGROUND]
NOW, THEREFORE, in consideration of the mutual covenants contained in this
Agreement, and for other good and valuable consideration the receipt and
sufficiency of which is acknowledged, the parties agree:
1. TERM. The Company agrees to employ Executive, and Executive agrees to
be employed by the Company, subject to the terms and conditions of
this Agreement, for the period commencing on May 24, 2005 (the
"Effective Date") and terminating on the fifth anniversary of the
Effective Date (the "Employment Term"), unless earlier terminated as
provided in Section 5.
2. EMPLOYMENT DUTIES.
2.1 During the Employment Period, Executive shall be employed in the
business of the Company and its Subsidiaries. Executive shall
serve with the title of President, and agrees, if elected, to
serve as a director and as President of the Company. Executive
shall devote substantially all of his working time and efforts to
the performance of duties under this Agreement.
2.2 In performing duties hereunder, Executive shall be available for
reasonable travel, as the needs of the business require.
Executive shall be based in Westbury, New York, or otherwise in
the Pompano Beach, Florida area.
3. COMPENSATION/BENEFITS. In consideration of Executive's services
hereunder, the Company shall provide Executive the following:
3.1 BASE SALARY. During the Employment Period, the Executive shall
receive an annual rate of base salary ("Base Salary") in an
amount not less than $500,000.
3.2 BONUSES. After the close of each fiscal year during the
Employment Period, the Company shall review the performance of
the Company and of Executive during the prior fiscal year, and
the Company may provide Executive with additional compensation as
a bonus if the Board, or any compensation committee thereof, in
its discretion, determines that Executive's contribution to the
Company warrants such additional payment and the Company's
anticipated financial performance during the present period
permits such payment. Bonuses shall be paid as a lump sum not
later than sixty (60) days after the end of the Company's
preceding fiscal year, provided Executive remains employed and
has not given written notice of termination at the time such
payment is due.
3.3 VACATIONS. Executive shall be entitled to two (2) weeks of paid
vacation per calendar year, provided however, that commencing on
the second anniversary of this Agreement Executive shall be
entitled to three (3) weeks of paid vacation per calendar year
and, provided further, that commencing on the further anniversary
of this Agreement, Executive shall be entitled to four (4) weeks
of paid vacation per calendar year. Unused vacation shall not be
carried over to any subsequent calendar year.
3.4 RELOCATION EXPENSES. Executive shall be entitled to $10,000 to be
applied to the expenses incurred by Executive in relocating form
Atlanta, Georgia to Westbury, New York.
3.5 STOCK WARRANT. To induce the Executive to enter into this
Agreement, Executive shall be granted by the Company a warrant to
purchase shares of common stock of the Company and Executive, in
the form attached as SCHEDULE 3.5.
3.6 OTHER BENEFITS. The Company shall provide to Executive such other
benefits, including the right to participate in medical and other
benefit plans, as are made generally available to executives of
the Company from time to time.
4. EXPENSES/INDEMNIFICATION.
4.1 EXPENSES. The Company shall reimburse Executive for the
reasonable business expenses incurred by Executive in the course
of performing his duties for the Company, upon submission of
invoices, vouchers or other appropriate documentation, as may be
required in accordance with the policies in effect from time to
time for executive employees of the Company, which policies have
been provided to Executive.
4.2 AUTOMOBILE. The Company shall lease for Executive an automobile.
The Executive shall be responsible for maintaining such
automobile, at his own expense, with the same standard of care
Executive applies to Executive's own property and as may be
required under any applicable lease agreement.
4.3 INDEMNITY. To the fullest extent permitted by law, the Company
shall indemnify Executive with respect to any actions commenced
against or involving Executive in his or her capacity as an
officer, director, employee, agent or fiduciary or former
officer, director, employee, agent or fiduciary of the Company,
or any Subsidiary of the Company thereof for which Executive may
render service in such capacity, whether by or on behalf of the
Company, its shareholders or third parties, and the Company shall
advance to Executive on a timely basis an amount equal to the
fees and expenses incurred in defending such actions, after
receipt of an itemized request for such advance, and an
undertaking from Executive to repay the amount of such advance,
with interest at a reasonable rate from the date of the request,
as determined by the Company, if it shall ultimately be
determined that Executive is not entitled (as a matter of law or
by judicial determination) to be indemnified against such
expenses. This indemnity shall survive any termination of
employment under this Agreement and is in addition to and not in
limitation of any other right to indemnification or exoneration
to which the Executive is entitled at law, or under the governing
charter documents of the Company. The Company agrees to use its
best efforts to secure and maintain officers' and directors'
liability insurance, including coverage for the Executive.
Executive.
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5. TERMINATION; CHANGE OF CONTROL.
5.1 AT-WILL EMPLOYMENT. Executive's employment hereunder is "at will"
and may be terminated at any time, with or without cause, at the
option of the Company, subject only to the obligations under the
Section 5.2 below. Additionally, this Agreement may be terminated
by Executive by delivering written notice to the Company in the
manner specified below. Upon any termination hereunder, the
Employment Period shall expire.
5.2 RIGHTS UPON TERMINATION; PAYMENT OF BENEFITS EARNED THROUGH DATE
OF TERMINATION. Upon any termination of Executive's employment
during the Employment Period, Executive shall in all events be
paid all accrued but unpaid Base Salary and all earned but unpaid
compensation (vacation) earned through his Date of Termination
(as defined below). Executive shall also retain all such rights
with respect to vested equity-based awards as are provided under
the circumstances under the applicable grant or award agreement,
and shall be entitled to all other benefits which are provided
under the circumstances in accordance with the provisions of the
Company's generally applicable employee benefit plans, practices
and policies and Executive shall have no further entitlements
with respect thereto.
5.3 NOTICE OF TERMINATION. Notice of termination of this Agreement or
of any termination of Executive's employment (other than by
reason of death) shall be communicated by written notice (a
"Notice of Termination") from one party to the other in
accordance with this Section 5 and Section 6. "Date of
Termination," with respect to any termination of Executive's
employment during the Employment Period, shall mean the effective
date of termination specified in the Notice of Termination.
5.4 CHANGE OF CONTROL. If an Event of a Change in Control (as defined
below) occurs during the Term, Executive shall be entitled to the
following benefits: (i) the immediate vesting of all outstanding
warrants and/or options to purchase shares of the Company's
common stock and any such outstanding warrants and/or options
held by the Employee shall remain exercisable through the end of
the stated term thereof, (ii) a cash lump sum payment equal to
four (4) months base salary payable at Executive's then current
rate, (iii) medical benefits provided under Section 3.6 for a
period of four (4) months commencing with the date of
consummation of the Event of a Change in Control, and (iv) the
ownership of any car provided to Employee shall be transferred to
Employee. For purposes of this Agreement, an "Event of a Change
in Control" shall mean (a) the sale, whether by way of merger,
consolidation, or other disposition, of all or substantially all
of the business and/or assets of the Company, (b) the sale by the
then stockholders of the Company in a single transaction or in a
series of related transactions of at least 50% of the outstanding
voting shares of the Company; (c) an exchange by the then
stockholders of the Company of their shares in a transaction that
qualifies as a reorganization within the meaning of the Internal
Revenue Code of 1986, as amended; or (d) the liquidation or
dissolution of the Company, except that a liquidation or
reorganization effected in a bankruptcy case by or against the
Company under Title 11 of the United States Code, as well as any
transactions carried out by or for the Company in connection with
such bankruptcy liquidation or reorganization, shall not be an
Event of a Change in Control.
6. NOTICE. Any notice required or permitted hereunder shall be in writing
and shall be deemed sufficient when given by hand or by nationally
recognized overnight courier or by express, registered or certified
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mail, postage prepaid, return receipt requested, and addressed, if to
the Company at 000 Xxxx Xxxxxx, Xxxxx 000, Xxxxxxxx, Xxx Xxxx 00000,
and if to Executive at the address set forth in the Company's records
(or to such other address as may be provided by notice). Notice shall
be effective three (3) days after it is delivered to any courier, or
immediately if delivered in hand.
7. MISCELLANEOUS. This Agreement and its schedules constitute the entire
agreement between the parties concerning the subjects hereof and
supersedes any and all prior agreements, term sheets or
understandings. This Agreement may not be assigned by Executive, and
may be assigned by the Company and shall be binding upon, and inure to
the benefit of, the Company's successors and assigns. The Company will
require any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Company to assume expressly and agree to
perform this Agreement in the same manner and to the same extent that
the Company would be required to perform it if no such succession had
taken place. As used in this Agreement, "Company" shall mean the
Company as hereinbefore defined and any successor to its business
and/or assets as aforesaid which assumes and agrees to perform this
Agreement by operation of law, or otherwise. Headings herein are for
convenience of reference only and shall not define, limit or interpret
the contents hereof.
8. AMENDMENT. This Agreement may be amended, modified or supplemented by
the mutual consent of the parties in writing, but no oral amendment,
modification or supplement shall be effective. No waiver by either
party of any breach by the other party of any condition or provision
contained in this Agreement to be performed by such other party shall
be deemed a waiver of a similar or dissimilar condition or provision
at the same or any prior or subsequent time. Any waiver must be in
writing and signed by Executive or an authorized officer of the
Company, as the case may be.
9. SEVERABILITY. The provisions of this Agreement are severable. The
invalidity of any provision shall not affect the validity of any other
provision, and each provision of this Agreement shall be valid and
enforceable to the fullest extent permitted by law.
10. RESOLUTION OF DISPUTES; ENFORCEMENT. Any controversy or claim seeking
equitable relief pursuant to this Agreement or any Schedule to this
Agreement, all controversies and claims arising under or in connection
with this Agreement or relating to the interpretation, breach or
enforcement hereof and all other disputes between the parties in
connection with the employment of the Executive shall be heard in the
courts of the State of New York ("Court") which shall have exclusive
jurisdiction of any and all such disputes and which shall apply the
law specified in Section 15 below. Each party shall pay the cost of
his or its own legal fees and expenses incurred in connection with any
such litigation. No party to any such litigation shall be liable to
the other for multiple, punitive, exemplary or consequential damages.
All parties consent to the jurisdiction of the Court, and agree INTER
ALIA that service may be had pursuant to the provisions of any
"long-arm statute" so-called applicable to proceedings pending within
such Court. Provided, disputes arising under SCHEDULE 3.5 shall be
resolved pursuant to the express dispute resolution provisions of such
agreements (if any there be).
11. SURVIVORSHIP. The provisions of Section 10 of this Agreement shall
survive Executive's termination of employment. Other provisions of
this Agreement shall survive any termination of Executive's employment
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to the extent necessary to the intended preservation of each party's
respective rights and obligations.
12. BOARD ACTION. Where an action called for under this Agreement is
required to be taken by the Board of Directors, such action shall be
taken by the vote of not less than a majority of the members then in
office and authorized to vote on the matter.
13. WITHHOLDING. All amounts required to be paid by the Company shall be
subject to reduction in order to comply with applicable federal, state
and local tax withholding requirements.
14. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original but all
of which together shall constitute one and the same instrument. The
execution of this Agreement may be by actual or facsimile signature.
15. GOVERNING LAW. This Agreement shall be construed and regulated in all
respects under the internal laws of the State of New York, without
regard to principles of conflict of laws.
19. CAPTIONS. All captions are provided for convenience, do not form a
part of this Agreement, and are not admissible for purposes of
construction.
IN WITNESS WHEREOF, this Agreement is entered into [under seal] as of the
date and year first above written.
DHB INDUSTRIES INC.
By: /s/ XXXXXX XXXXXX
_______________________________
Name: Xxxxxx Xxxxxx
Its: Xxxxxx Xxxxxx
Compensation Committee
/s/ XXXXX X. XXXXX
__________________________________
Ret. Gen. Xxxxx Xxxxx
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