Exhibit 10(q)
AMENDMENT TO THE
SEVERANCE, NONCOMPETITION AND NONDISCLOSURE AGREEMENT
DATED JANUARY 18, 2000
THIS AGREEMENT, dated as of February , 2000, between Response
USA, Inc., a Delaware corporation, with its principal address at 3 Executive
Campus, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ (the "Company") and ▇▇▇▇▇▇
▇▇▇▇▇▇▇, an individual with an address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇
▇▇▇▇▇ (the "Executive"), in accordance with the agreements of the parties,
intending to be legally bound and in consideration of the good, valuable and
mutual promises and covenants set forth hereinafter, modifies and amends, in
specified parts, the Severance, Noncompetition and Nondisclosure Agreement
entered into between the parties on January 18, 2000 (the "Original Agreement")
as follows:
SECTION 1: NO OTHER AMENDMENTS
It is specifically agreed by and between the parties that the
Original Agreement shall remain in full force and effect except as specifically
modified herein and that in the case of any conflict in the terms of the two
agreements, the terms of this Agreement shall control.
SECTION 2: MODIFICATION TO SECTION 1 OF THE JANUARY 18,
2000 SEVERANCE, NONCOMPETITION AND
NONDISCLOSURE AGREEMENT BETWEEN RESPONSE USA
INC. AND ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Section 1 of the Original Agreement is hereby modified to read
as follows:
1. TERMINATION OF EMPLOYMENT; SEVERANCE PAYMENT
(a) Effective February 28, 2000 (the "Termination date"),
the Company shall terminate the Executive's employment pursuant to Section 7.2
of the Employment Agreement without Cause (as such term is defined in the
Employment Agreement). The Executive hereby waives any notice requirement for
termination without Cause pursuant to the Employment Agreement. Effective
January 18, 2000, the Executive shall resign as an officer and director of the
Company and any subsidiary of the Company, but shall remain as an employee of
the Company until the Termination Date. From the date hereof until the
Termination Date, the Executive shall continue to be entitled to receive all
salary and benefits which he is currently receiving as an Executive of the
Company pursuant to the Employment Agreement. Effective on the Termination date,
executive's employment with the Company shall be terminated and following the
Termination date Executive shall no longer be employed by the Company or any
subsidiary of the Company and shall not be entitled to any benefits as an
Executive of the Company, other than as required by law.
(b) On the Termination Date, the Company shall pay to the
Executive, in one lump sum payment, as severance, the sum of Three Hundred
Twenty-One Thousand, Two Hundred Fifty-Seven Dollars and Zero Cents
($321,257.00).
(c) Commencing on the first day of April, 2000 and
continuing on the first day of each succeeding calendar month thereafter, to and
including the first day of March, 2002, the Company shall pay to the Executive,
as additional severance, in 24 equal monthly payments in the amount of
Twenty-Nine Thousand One Hundred Two Dollars and Zero Cents ($29,102.00).
(d) The Company shall reimburse Executive on the
Termination Date, in an amount not to exceed Ten Thousand Dollars and Zero
Cents ($10,000.00), for legal fees incurred by Executive as a result of the
drafting and/or execution of the present Agreement, upon presentation of
appropriate time records and invoices.
(e) The Company, at any time without prior notice or
penalty, may prepay the amounts otherwise due to Executive, by paying Executive
in accordance with the attached Schedule A. Upon payment of the appropriate
amount set forth opposite the respective payment date on Schedule A, all amounts
due pursuant to subparagraphs 1(b) and 1(c) shall be paid in full. In addition,
the Company shall be obligated to make prepayments to Executive within 10 (ten)
days following the occurrence of any one of the following events, in the
respective amounts calculated below:
(i) Fifty percent (50%) of all monies in excess
of the first Seven Hundred Fifty Thousand ($750,000) paid to the Company
pursuant to the post-closing adjustments under the Stock Purchase Agreement with
VSI/TAP, Inc., paid by such party to the Company in a lump sum or over a six
month period; or
(ii) the final approval of, and full funding
received by the Company from ▇▇▇▇▇▇, ▇▇▇▇▇ Capital Holdings Corporation in an
amount of not less than thirty (30) times the applicable Monthly Recurring
Revenue in connection with, the contract to provide goods and services to the
City of New York. The Company agrees to use its commercially reasonable efforts
to obtain such funding in an amount of not less than thirty (30) times the
applicable Monthly Recurring Revenue.
(f) Upon payment of the appropriate amount set forth
opposite the respective payment date on Schedule A, all amounts due pursuant to
subparagraphs 1(b) and 1(c) shall be paid in full. If pursuant to the prepayment
obligations in subparagraph 1(e) above, the Company makes a prepayment of less
than the full amount then due on Schedule A, a new Schedule A shall be prepared
to reflect the revised remaining payment schedule, calculated by the quotient
obtained from the remaining amount then due divided by the remaining number of
monthly payments under subparagraph 1(c) above. Any check, draft, money order,
or other instrument given in payment of all or any portion of the obligations
set forth by this Agreement shall not constitute payment under this Agreement or
diminish any rights of the Executive except to the extent actual cash proceeds
of such instruments are actually and unconditionally received by the Executive
and applied to the indebtedness as provided in this Agreement. All payments
shall be made in good and collected funds available to the Executive on or
before the respective due dates. If any check or other negotiable instrument
tendered as payment for any payment due under this Agreement is returned as
uncollectable, the Company shall pay, an additional $100.00 fee for each check
or instrument so returned.
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(g) If at any time the Company shall fail to pay any
installment due to Executive under this Agreement when due and such amount shall
remain unpaid for a period in excess of ten (10) days after such payment shall
be due, in addition to any other rights or remedies that Executive shall have
with respect to such failure to make timely payment under this Agreement, the
Company shall be liable to pay on demand a late charge (the "Late Charge"), to
the extent permitted by law, equal to five percent (5%) of each such late
installment or part thereof.
(h) If the Executive becomes a party to any suit or
proceeding or if the Executive engages counsel to collect any of the
indebtedness under the terms of this Agreement or to enforce performance of the
agreements, conditions, covenants, provisions, or stipulations of this Agreement
and Executive receives a final, nonappealabe judgement against the Company, the
Executive's reasonable costs, expenses and counsel fees, shall be paid to the
Executive by the Company, within ten (10) days after demand. All such costs,
expenses, and counsel fees so incurred of every kind and character shall be a
demand obligation owing by Company and the party incurring such expenses shall
be surrogated to all rights of the person receiving such payment until paid and
such costs, expenses, and counsel fees shall be deemed to be part of the
indebtedness hereunder. In addition, and without limiting the foregoing, the
Company will, on demand, reimburse the Executive for all reasonable
out-of-pocket costs and expenses, including, without limitation, the reasonable
fees and expenses of legal counsel incurred by the Executive:
(i) in connection with the enforcement of this
Agreement as a result of the occurrence of any default or event of default under
this Agreement;
(ii) as a result of this Agreement being placed
in the hands of an attorney for collection or enforcement or being collected or
enforced through any legal proceeding;
(iii) as a result of a claim being made under this
Agreement in any Bankruptcy, reorganization, receivership, or other proceedings
affecting creditor's rights; and
(iv) in connection with the Executive's rights
under this Agreement or any property subject thereto.
(i) The occurrence and continuance of any of the
following events or conditions shall, except as otherwise expressly provided
below; without notice or demand; constitute an "Event of Default" under this
Agreement:
(i) Failure by the Company to pay the Executive
any sums within ten (10) days following the receipt by the Company of written
notice from the Executive that such sums are due and payable, whether for
principal, interest, fees, costs, charges, or otherwise, and whether upon stated
maturity, acceleration, or otherwise, due under this Agreement;
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(ii) Any dissolution, liquidation, merger,
consolidation, or termination of existence of the Company, except a merger or
consolidation involving the Company where the Company is the surviving entity or
where the surviving entity expressly assumes the obligations of this Agreement
in writing in form and substance reasonably acceptable to the Executive; or
(iii) Institution of any proceedings by or against
the Company or any general partner or controlling shareholder of Company under
any bankruptcy, insolvency, debt adjustment, debtor rehabilitation, or similar
statute, whether state or federal, and such proceedings shall have continued
undischarged and unstayed for ninety (90) days after the commencement thereof,
the appointment of a judicial officer or representative for the Company or for
the Company's property, including without limitation, a receiver trustee,
conservator, liquidator, sequestrator, custodian, or other similar or dissimilar
judicial officer or representative.
(j) Upon the occurrence of an Event of Default, all sums
due under this Agreement shall, at the option of the Executive, become
immediately due and payable without notice or demand on the Company and without
requiring any recourse against any person or property liable for paying or
securing the sums due under this Agreement, and thereupon, the Executive shall
have all rights and remedies provided under this Agreement. Upon the occurrence
and continuance of an Event of Default under this Agreement, a rate of interest
equal to five percent (5%) shall be charged on the unpaid balance of the amounts
owed by the Company ("Default Rate.") Upon the occurrence of an Event of Default
and the entry of a judgment against the Company under this Agreement, the
interest rate to be paid by Company on the amount due under this Agreement shall
continue at the Default Rate and the Executive may recover all reasonable costs
of suit and other reasonable expenses in connection therewith, including
reasonable attorneys fees for collection, together with interest on all of the
foregoing, including without limitation, interest at the Default Rate, and after
the date of any sheriff's sale until actual payment is made by the sheriff to
the Executive of the full amount due to the Executive.
(k) In the event the Company fails to pay the amounts set
forth in subparagraphs (b) and (c) above (other than in connection with an
acceleration of such payments pursuant to subparagraphs (e) and (i) above), such
sections sets forth a warrant of authority for any attorney to confess judgment
against the Company and to execute upon said judgment by garnishment, levy, or
any other type of execution against the Company's bank accounts or other
personal property, real property, or intangible property in accordance with
Section 10 of the Original Agreement. In granting this warrant of attorney to
confess judgment against the Company and to execute upon said judgment against
the Company, the Company knowingly, intelligently, voluntarily, and
unconditionally waives any and all rights the Company has or may have to notice
and a prior judicial proceeding under the respective constitution and laws of
the United States and the Commonwealth of Pennsylvania to determine the
Company's rights and liabilities. All confessions of judgment or amicable
actions set forth in this Section 1(k) shall be with release of procedural
errors, waivers of appeals, and without stay of execution; and the Company
waives all relief from any and all appraisement or exemption or action wherein
all relief from any and all appraisement or exemption or action wherein judgment
is to be confessed.
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IN WITNESS WHEREOF, the parties have duly executed this
Agreement as of the date first above written.
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RESPONSE USA, INC.
By:
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