AT-WILL EMPLOYMENT AGREEMENT
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This AT-WILL EMPLOYMENT AGREEMENT (this "Agreement"), dated
August 13, 1998 (the "Effective Date"), is by and among Guardian International,
Inc., a Nevada corporation ("Guardian"), Mutual Central Alarm Services, Inc., a
New York corporation ("Mutual"), Stat-Land Burglar Alarm Systems & Devices,
Inc., a New York Corporation (the "Employer") and Xxxxxxx Xxxxxxx (the
"Employee").
W I T N E S S E T H:
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WHEREAS, Mutual is a wholly-owned subsidiary of Guardian; and
WHEREAS, effective as of the date hereof, Mutual acquired all
of the issued and outstanding capital stock of the Employer under the terms of
that certain Stock Purchase Agreement, dated the date hereof, by and between
Guardian, Mutual, and Xxxx Xxxxxxx and Xxxxxx Xxxxxxx (the "Purchase
Agreement"). Capitalized terms used and not otherwise defined herein shall have
the meanings ascribed to them in the Purchase Agreement; and
WHEREAS, it is a condition to the Purchase Agreement that
Guardian, Mutual, the Employer and the Employee execute this Agreement;
WHEREAS, Mutual and Guardian recognize that the Employee will
contribute to the future growth and success of the security business of the
Employer as well as Mutual and Guardian, consisting of burglar and fire alarm,
closed circuit television and electronic access and control , and central
station monitoring services to residential and commercial customers (the
"Business"), and therefore desire to induce the Employee to remain an employee
of the Employer, subsequent to the transactions contemplated by the Purchase
Agreement; and
WHEREAS, the Employee desires to remain an employee of the
Employer subsequent to the transactions contemplated by the Purchase Agreement.
NOW, THEREFORE, in consideration of the premises and
the mutual covenants and agreements contained herein, the receipt and
sufficiency of which are mutually acknowledged, the parties hereto hereby agree
as follows:
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1. Employment. The Employer hereby agrees to employ the
Employee and the Employee hereby agrees to serve the Employer, on the terms and
conditions hereinafter set forth in this Agreement.
2. At Will Employment. This Agreement shall be effective as of
the day and year first written above. THE EMPLOYEE AND THE EMPLOYER ACKNOWLEDGE
AND AGREE THAT THE EMPLOYEE IS AN EMPLOYEE "AT WILL" AND THAT EITHER THE
EMPLOYEE OR THE EMPLOYER REMAIN FREE TO TERMINATE THE EMPLOYMENT RELATIONSHIP AT
ANY TIME FOR ANY REASON.
3. Position and Duties. During the Employee's employment with
the Employer and subject to the provisions of this Section 3, the Employee shall
serve as Vice-President of Operations and shall faithfully perform all duties
and responsibilities as the President of the Employer or his designee may direct
from time to time.
4. Best Efforts. The Employee's employment with the Employer
shall be full time and the Employee shall devote his best efforts and business
time exclusively to the performance of his duties and responsibilities as set
forth in this Agreement, which duties and responsibilities shall be performed
competently, carefully and faithfully. The Employee shall not, while an employee
of the Employer and without the prior approval of the Employer, engage in any
other gainful occupation or activity which conflicts with or impinges upon the
full and faithful performance of the Employee's duties, or otherwise violates
any term or provision of this Agreement. It is expressly understood and agreed,
however, that the provisions of this Section 4 shall not be construed to prevent
the Employee from investing or trading for his own account provided that such
investment activity does not impair the full and faithful performance by the
Employee of his duties and responsibilities hereunder, or otherwise violate any
provision of this Agreement.
5. The Employee's Compensation.
a) Salary. During the term of the Employee's
employment with the Employer, the Employer shall pay to the Employee an annual
base salary as determined from time to time by the President of Employer, in
accordance with the normal payroll schedules of the Employer in effect from time
to time, less all appropriate withholdings for federal, state and local taxes
and unemployment insurance. The Employee's current base salary is $32,500.
b) Commissions. In addition to the Employee's annual
base salary, during the term of the Employee's employment with the Employer, in
consideration of the timely and proper performance by the Employee of his
obligations in accordance with this Agreement, the Employer shall pay the
Employee sales commissions in accordance with the Employer's sales plan in
effect from time to time.
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6. The Employee's Benefits. As an employee of the Employer,
during the term of the Employee's employment with the Employer, the Employee
shall be entitled to receive and enjoy such employee plans and benefits as are
generally made available by the Employer to similarly situated employees.
7. Guardian Shares. As additional consideration for executing
this Agreement, upon execution of this Agreement, Guardian shall issue to the
Employee a Guardian Common Stock certificate having an aggregate Guardian Market
Value as determined at the time of the Closing equal to Twenty Five Thousand
Dollars ($25,000).
8. Stock Options. As additional consideration for executing
this Agreement, the Employee shall receive the option to purchase that number of
shares of Guardian Common Stock having an aggregate Guardian Market Value as
determined at the time of the Closing equal to Twenty Five Thousand Dollars
($25,000) (the "Options"), subject to the terms and conditions of the stock
option plan to be established by Guardian (the "Stock Option Plan") and a grant
agreement granting such Options (the "Grant Agreement"). The exercise price of
the Options shall be equal to the exercise price equal to the five-day average
closing price of the Common Stock for the five days prior to the grant thereof..
The Options will vest at the rate of one-fifth per year commencing with the
Effective Date. Vested Options shall be exercisable on each anniversary of the
date of the grant of such Options. If the Employee does not exercise all of the
vested Options in any given year, such vested Options may be exercised in
subsequent years but in no event later than ten years from the date of the grant
thereof. In the event that the Employee's employment hereunder is terminated by
Employer "without cause" prior to the vesting of all Options, any such unvested
Options shall vest automatically as of the date of termination. For purposes for
this Agreement, "without cause" shall mean termination of the Employee's
employment hereunder for reasons other than: (i) any conviction of the Employee
of a felony or any conduct which if proved would support conviction of a felony;
(ii) conduct amounting to a material act of fraud, gross misconduct or
dishonesty involving the Employer; (iii) a material act of fraud or dishonesty
not involving the Employer which has a material adverse effect upon the Business
or reputation of Employer; (iv) continuing material violation by the Employee of
his obligations under this Agreement after written notice thereof to the
Employee and failure to cure such violation within fifteen (15) days following
such notice; (v) misuse of alcohol or controlled substance that materially
impairs the Employee's ability to perform the duties of his employment as
determined by a physician retained by the Employer or, if the Employee refuses
to submit to appropriate examinations by such physician at the request of the
Board of Directors of the Employer, then by at least three members of the Board
of Directors; (vi) the unlawful use of drugs or other controlled substances;
(vii) death; or (viii) disability. In the event that Employee's employment
hereunder is terminated for any reason other than without cause prior to the
vesting of all Options, any such unvested Options shall be forfeited, unless
otherwise provided in the Stock Option Plan or Grant Agreement.
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9. Confidentiality.
a) For good consideration and as an inducement for
the Employer to employ the Employee, the Employee agrees that, both during the
period of the Employee's employment with the Employer and after the termination
of this Agreement and his employment with the Employer, for any reason or no
reason, the Employee will hold in a fiduciary capacity for the benefit of the
Employer, and shall not, directly or indirectly, use or disclose, except as
authorized by the Employer in connection with the performance of his duties
hereunder, any Confidential Information (as defined below) that the Employee may
have or acquire (whether or not developed or compiled by the Employee or whether
or not the Employee has been authorized to have access to such Confidential
information) prior to or during the Term. As used in this Agreement, the term
"Confidential Information" means and includes any and all information, data and
know-how specific to the Business of the Employer or its affiliates, Parent or
Subsidiaries, and not generally known in the industry that is disclosed to the
Employee by the Employer or known by him or her as a result of his relationship
with the Employer (or a company acquired by the Employer) and not generally
within the public domain (whether or not constituting a Trade Secret), including
without limitation, the following: financial information, supply and service
information, marketing information, personnel information, customer information
and information with respect to any corporate affairs that the Employer treats
as confidential.
The term "Confidential Information" does not include
information that has become generally available to the public by the act of the
Employer or by the act of one who has the right to disclose such information
without violating any right of confidentiality to the Employer or the customer
to which such information pertains.
Nothing in this Section 9 shall prevent the Employee from
disclosing any Confidential Information to the extent such disclosure is
required by law or any order of a court or government authority with
jurisdiction; provided, however, that the Employee agrees to give the Employer
advance written notice as soon as possible of the Confidential Information
required to be disclosed, and at the Employer's request, to use his best efforts
to obtain assurances that the Confidential Information required to be disclosed
will be maintained on a confidential basis and will not be disclosed to a
greater degree than required by law.
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b) The covenant contained in this Section 9 shall
survive the termination of the Employee's employment with the Employer for any
reason or no reason for a period of two (2) years; provided, however, that with
respect to those items of Confidential Information which constitute trade
secrets under applicable law, the Employee's obligations of confidentiality and
non-disclosure as set forth in this Section 8 shall continue to survive after
said two (2) year period to the greatest extent permitted by applicable law.
These rights of the Employer are in addition to those rights the Employer has
under the common law or applicable statutes for the protection of trade secrets.
10. Covenant Not to Compete. For good consideration and as an
inducement for the Employer to employ the Employee, the Employee agrees that he
will not engage or participate, directly or indirectly, in any business that
competes with the Business, whether as employee, employer, consultant, agent,
principal, partner, stockholder, corporate officer, director, or other
representative capacity, at any time during the Employee's employment with the
Employer. Nothing in this Section 10 shall prevent the Employee from owning less
than 5% of the shares of any company which has shares registered on any stock
exchange or with shares traded in the OTC market. In the event any court shall
refuse to enforce any portion of the covenant set forth in this Section 10, then
such unenforceable portion shall be deemed eliminated and severed from said
contract for the purposes of said court's proceedings to the extent necessary to
permit the remaining portions of the covenant to be enforced.
11. Covenants Against Other Actions Damaging Employer. The
Employee agrees that he shall not, at any time during his employment with the
Employer and for the two (2) year period following the termination of this
Agreement and his employment with the Employer, for any reason or no reason,
(the "Non-Solicitation Period"), for himself or on behalf of or in conjunction
with any third party, solicit any employee of the Employer its affiliates or
subsidiaries to leave such employment. The Employee further agrees that during
the Non-Solicitation Period, he will not directly or indirectly, on his own
behalf or in the service of or on behalf of others, solicit, divert or
appropriate, or attempt to solicit, divert or appropriate, to any competing
business, any customers of the Employer who are customers as of the date of
termination of the Employee's employment with the Employer. If, during the
period of the Employee's employment with the Employer, the Employee is engaged
in or associated with the planning or implementing of any project, program or
venture involving the Employer and a third party or parties (a "Venture"), or
any discussions, analysis or negotiations with respect to an investment in,
merger, acquisition or purchase, directly or indirectly, of the stock, assets,
or business of any entity (an "Acquisition"), rights in the Venture and the
Acquisition and any opportunity to make any investment in the entity to be so
acquired (the "Target") shall belong to the Employer and shall constitute a
corporate opportunity belonging exclusively to the Employer. Except as approved
by the Board, the Employee shall not be entitled to any interest in any such
Venture or to invest or solicit any third party to invest in the Target or
consummate the Acquisition, or to any commission, finder's fee or other
compensation in connection therewith other than any Salary paid to the Employee
for performance of his duties in the ordinary course of business. In the event
any court shall refuse to enforce any portion of the covenants set forth in this
Section 12, then such unenforceable portion shall be deemed eliminated and
severed from said contract for the purposes of said court's proceedings to the
extent necessary to permit the remaining portions of the covenant to be
enforced.
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12. Release.
(a) The Employee, for himself, his heirs, executors,
administrators and assigns, hereby knowingly and voluntarily releases and
discharges the Employer and all of its present or former parents, subsidiaries
and affiliates, including, without limitation, their respective directors,
stockholders, officers, employees and agents (the "Employer Releasees") from all
actions, causes of actions, suits, debts, dues, sums of money, accounts,
reckonings, attorneys' fees, costs, disbursements, bonds, bills, specialties,
covenants, contracts, controversies, agreements, promises, variances,
trespasses, damages, judgments, extents, executions, claims and demands,
whatsoever, at law, or in equity which the Employee ever had, now has or
hereafter can, shall or may have against the Employer for, upon or by reason of
those matters related to or arising out of the Employee's employment with the
Employer through the date hereof.
(b) The Employee acknowledges that he has had an
opportunity to consult with his attorney and other advisors regarding the form,
content, meaning and effect of this Agreement and has been advised as to the
implications thereof and is entering into this Agreement of his own free will
and concern.
(c) The Employee hereby waives any rights that he has
to rescind any release and discharge pursuant to this Section.
13. Arbitration. All disputes or controversies between the
parties arising from or related to any matter that pertains to this Agreement,
to the employment of the Employee by the Employer, or to the termination the
Employee's employment which otherwise would allow or require resort to a court,
administrative, or other governmental dispute resolution forum (whether the
claim is legal or equitable in nature, whether it is based on any tort,
contract, or common law theory of recovery, or whether it is based on any
federal, state, or local employment discrimination or civil rights statute,
executive order, law, regulation, or ordinance, including without limitation the
Age Discrimination in Employment Act of 1967, the Americans with Disabilities
Act, Title VII of the Civil Rights Act of 1964, the New York State Human Rights
Law, and the New York City Humans Rights Law) shall be referred to binding,
non-appealable arbitration in accordance with the procedures set forth in
Exhibit A annexed hereto and without recourse any litigation except as set forth
in Exhibit A. Each party hereby submits to personal jurisdiction in Xxx Xxxx,
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Xxx Xxxx for the purpose of such arbitration proceedings, and/or any suits to
confirm same. Pending completion of any arbitration proceedings, payments not in
dispute shall continue to be made and obligations not in dispute shall continue
to be performed.
14. Assignment. This Agreement is personal to the Employee and
the Employee may not assign or transfer any of its benefits or obligations
hereunder. Upon written notice by the Employer to the Employee, the Employer may
assign its rights under this Agreement to any entity (i) that controls or
acquires control of the Employer, (ii) that is controlled by, is under common
control with, or acquires an interest in the Employer, or (iii) in which the
Employer acquires a financial interest, provided that such entity assumes the
Employer's obligations under this Agreement or that the Employer remains liable
for its obligations under the Agreement. Upon written notice by the Employer to
the Employee, the Employer may assign its rights to any entity that acquires
substantially all of the Employer's assets provided that such entity assumes the
Employer's obligations under this Agreement.
15. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without
reference to the conflicts of laws principles thereof.
16. Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto and supersedes all prior agreements,
understandings and arrangements, both oral and written, between the parties
hereto with respect to the subject matter hereof. This Agreement may not be
modified in any way unless in writing signed by both the Employer and the
Employee.
17. Notices. Any notices required or permitted to be given
under this Agreement shall be in writing and shall be deemed to have been duly
given when delivered by hand and receipted or when received or refused if
delivered by United States mail, by registered or certified mail, return receipt
requested, postage prepaid, as follows:
If to the Employer:
Mutual Central Alarm Services, Inc.
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxx
Phone: 000-000-0000
Fax: 000-000-0000
with a copy to:
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Xxxxxxxx & Xxxxxxxx
Xxxx Xxxxxxxx Xxxxx
000 Xxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
Phone: 000-000-0000
Fax: 000-000-0000
If to the Employee:
Xx. Xxxxxxx Xxxxxxx
00 Xxxxxxxx Xxxx Xxxx
Xxxxxx Xxxxxx, XX 00000
18. Benefits; Binding Effect. This Agreement shall be for the
benefit of and binding upon the parties hereto and their respective legal
representatives, successors and, where applicable, assigns.
19. Severability. The invalidity of any one or more of the
words, phrases, sentences, clauses or sections contained in this Agreement shall
not affect the enforceability of the remaining portions of this Agreement or any
part hereof, all of which are inserted conditionally their being valid in law,
and, in the event that anyone or more of the words, phrases, sentences, clauses
or sections contained in this Agreement declared invalid, this Agreement shall
be construed as if such invalid word or words, phrase or phrases, sentence or
sentences, clause or clauses, or section or sections had not been inserted.
20. Modification; Waiver; Discharge. No provision of this
Agreement may be modified, waived or discharged unless such waiver, modification
or discharge is agreed to in writing and signed by the Employee and a duly
authorized representative of the Employer. No waiver by either party hereto at
any time of any breach by the other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time.
21. Section Headings. The section headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
22. Equitable Remedies. The Employee acknowledges that the
Employer would not have an adequate remedy at law for money damages if the
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Employee breaches Sections 9, 10 or 11. Therefore, in addition to all other
remedies to which the Employer may be entitled for a breach or threatened breach
of this Agreement, the Employer will be entitled to specific enforcement of this
Agreement and to injunctive or other equitable relief as a remedy for a breach
or threatened breach. In the event of legal proceedings in connection with this
Agreement, the non-prevailing entity shall pay all reasonable attorneys' fees
and costs of the prevailing party at trial and on appeal.
[Signature Pages Follow]
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IN WITNESS WHEREOF, the parties hereto have executed and
delivered this Agreement on the day and year first above written.
EMPLOYER:
STAT-LAND BURGLAR ALARM SYSTEMS & DEVICES, INC.
a New York corporation
By: /s/XXXX XXXXXXX
------------------------
Name: Xxxx Xxxxxxx
Title: President
MUTUAL:
MUTUAL CENTRAL ALARM SERVICES, INC.
a New York corporation
By: /s/XXXX X. XXXXX
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Name: Xxxx X. Xxxxx
Title: President
GUARDIAN:
GUARDIAN INTERNATIONAL, INC.
a Nevada corporation
By: /s/XXXXXX X. XXXXX
------------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President
[Employee's Signature Follows]
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EMPLOYEE:
/s/XXXXXXX XXXXXXX
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Xxxxxxx Xxxxxxx
STATE OF NEW YORK )
-------- ) ss.
COUNTY OF STATEN ISLAND )
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The foregoing instrument and signature was acknowledged before
me on this 13th day of August, 1998, by XXXXXXX XXXXXXX.
/s/XXXXXX X. XXXXXXXX, III
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Xxxxxx X. Yslesias, III
Notary Public
Commissioner of the Superior Court
[NOTARIAL SEAL]
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EXHIBIT A
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Arbitration Procedures
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a. If a dispute or controversy arises, the parties hereto
shall attempt in good faith to resolve such dispute or controversy promptly by
negotiation. Any such dispute or controversy which has not been resolved by
negotiation within thirty (30) days after the initiation of discussions shall be
resolved by binding arbitration in accordance with the then current CPR Rules
for Non-Administered Arbitration of Business Disputes. Unless the parties agree
otherwise, the arbitration shall be conducted in New York, New York by a panel
of three arbitrators. The disputing parties shall each select one arbitrator,
and the arbitrators so selected shall select an attorney as the third
arbitrator. If the arbitrators selected by the disputing parties fail to agree
on the third arbitrator within thirty (30) days of the date this arbitration
provision becomes operative, any person involved may request CPR to make the
appointment in accordance with its applicable rules.
b. The arbitrators shall decide the issues submitted to them
in accordance with the provisions and commercial purposes of this Agreement;
provided that, all substantive questions of law shall be determined under the
laws of the State of New York (without regard to its principles of conflicts of
laws).
c. The arbitration shall be governed by the United States
Arbitration Act, 9 U.S.C. Section 1, et seq., and judgment upon the award
rendered by the arbitrators may be entered by any court having jurisdiction
thereof. The arbitrators may grant any remedy or relief which is just and
equitable, including injunctive relief or specific performance.
d. The parties hereto agree to facilitate the arbitration by:
(i) making available to one another and to the arbitrators for examination,
inspection and extraction all documents, books, records and personnel under
their control if determined by the arbitrators to be relevant to the dispute;
(ii) participating in reasonable discovery, including oral depositions; (iii)
conducting arbitration hearings to the greatest extent possible on successive
days; and (iv) observing strictly the time periods established by the Rules or
by the arbitrators for submission of evidence or briefs.
e. Initially, the disputing parties shall each pay one-half of
the costs (excluding attorneys' fees) of any arbitration; provided, however,
that the arbitrators shall divide all costs excluding attorneys' fees) incurred
in conducting the arbitration in their final award in accordance with what they
deem just and equitable under the circumstances, and any party who is allocated
in excess of one-half of such costs shall reimburse the other for such excess
costs.
f. Notwithstanding the exclusivity of the dispute resolution
procedures specified herein, a party hereto, without prejudice to such
procedures, may file a complaint or seek an injunction or other provisional
judicial relief if in its sole judgment such action is necessary to avoid
irreparable damage or to present the status quo. Despite any such action, the
parties shall continue to participate in good faith in the procedures specified
herein.
