EMPLOYMENT AGREEMENT
Exhibit 10.3
This
EMPLOYMENT AGREEMENT (this “Agreement”) is made and
entered into as of March 5, 2019, by and between BK Technologies,
Inc., a Nevada corporation (the “Company”), and Xxxxx
X. (Xxxxx) Xxxxxx, an individual (the
“Executive”).
The
Company desires to employ the Executive as an executive of the
Company, and the parties desire to enter into this Agreement with
respect to such employment.
NOW,
THEREFORE, in consideration of the mutual promises and covenants
herein contained, the parties hereto intending to become legally
bound hereby agree as follows:
1. Employment. The
Company hereby agrees to employ the Executive, and the Executive
hereby agrees to be employed by the Company, upon the terms and
conditions hereinafter set forth.
2. Duties
and Services.
2.1 Title
and Duties. The Executive shall serve as Chief
Operating Officer of the Company and shall perform such duties as
may be assigned to him from time to time by the President or the
Board of Directors of the Company. The Executive shall
report to the President and the Board of Directors of the Company
in carrying out the Executive’s duties.
2.2 Time. The
Executive shall devote his full business time and attention to the
business of the Company and to the promotion of the Company’s
best interest, subject to vacations, holidays and normal illnesses
pursuant to the Company’s policies in place from time to
time. The Executive shall at all times comply with Company policies
in place from time to time, including but not limited to the
Company’s Code of Ethics.
2.3 Travel. The
Executive shall undertake such travel as may be necessary and
desirable to promote the business and affairs of the Company,
consistent with the Executive’s position and duties with the
Company.
3. Term
of Employment. The Executive’s employment
will be “at-will,” meaning that either the Executive or
the Company may terminate the Executive’s employment at any
time and for any reason, with or without cause.
4. Compensation.
4.1 Base
Salary. For the services to be rendered by the
Executive pursuant to this Agreement, the Company shall pay the
Executive a base salary equal to $215,000 (the “Base
Salary”). The compensation
paid hereunder to the Executive shall be paid in accordance with
the normal payroll practices of the Company and shall be subject to
the customary withholding taxes and other employment taxes as
required with respect to compensation paid by the Company to an
employee. The Base Salary will be subject to annual
review and adjustment by the Compensation Committee of the
Company’s Board of Directors based upon the Executive’s
performance.
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4.2
Annual
Bonus. Commencing with respect to the
Company’s 2019 fiscal year, the Executive will be eligible to
receive a bonus, payable in cash or through equity in the Company,
as determined by the Compensation Committee of the Company’s
Board of Directors. The bonus will be subject to the
achievement of performance metrics, goals, objectives and/or other
criteria as determined by the Compensation Committee of the
Company’s Board of Directors. Any stock options in
the Company will vest over a period of five years from the date of
grant, and will be nonqualified options under the federal tax
laws. Any equity award shall be evidenced by and subject
to the terms and conditions of an Award Agreement entered into
between the Company and the Executive.
4.3 Severance. In
the event this Agreement is terminated by the Company without
Cause, then the Company shall pay the Executive an amount equal to
six (6) months of the Executive’s Base Salary in effect at
the time of the termination or the original Base Salary set forth
herein, whichever is greater, provided that the same shall be
payable by the Company over a twelve (12)-month period in
accordance with the Company’s normal payroll practices and
subject to applicable law. The severance shall commence
as of the effective date of such termination. If the
Executive is terminated for Cause, the Executive shall not be
entitled to any severance under this Agreement. For
purposes of this Agreement, “Cause” shall exist if the
Executive (i) acts dishonestly or incompetently or engages in
willful misconduct in performance of his executive duties, (ii)
breaches the Executive’s fiduciary duties owed to the
Company, (iii) intentionally fails to perform duties assigned to
him, (iv) is convicted or enters a plea of guilty or nolo
contendere with respect to any felony crime involving dishonesty or
moral turpitude, and/or (v) breaches his obligations under this
Agreement.
5. Expenses
and Vacation.
5.1 Travel
and Entertainment Expense. The Company shall
reimburse the Executive for all reasonable and necessary travel and
entertainment expenses incurred by Executive in the performance of
the Executive’s duties hereunder upon submission of vouchers
and receipts evidencing such expenses in accordance with applicable
Company policies.
5.2 Vacation. The
Executive shall be entitled to vacation of up to four (4) weeks per
calendar year, pursuant to the applicable Company
policy. All vacations shall be in addition to recognized
national holidays. During all vacations, the
Executive’s compensation and other benefits as stated herein
shall continue to be paid in full. Such vacations shall
be taken only at times convenient for the Company, as approved by
the executive or body to which the Executive reports pursuant to
this Agreement.
6. Company
Benefit Programs. In addition to the compensation
and the rights provided for elsewhere in this Agreement, the
Executive shall be entitled to participate in each plan of the
Company now or hereafter adopted and in effect from time to time
for the benefit of executive employees of the Company, to the
extent permitted by such plans and applicable law. Nothing in this
Agreement shall limit the Company’s right to amend, modify
and/or terminate any benefit plan, policies or programs at any time
for any reason.
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7. Restrictive
Covenants and Need for Protection. The Executive
acknowledges that, because of his senior executive position with
the Company, he has or will develop knowledge of the affairs of the
Company and its subsidiaries and their relationships with supplies,
dealers, distributors and customers such that he could do serious
damage to the financial welfare of the Company and/or its
subsidiaries should he compete or assist others in competing with
the business of the Company and/or its
subsidiaries. Consequently, and in consideration of the
Executive’s employment with the Company, and for the benefits
that the Executive is entitled to receive under this Agreement, and
for other good and valuable consideration, the receipt of which he
hereby acknowledges, the Executive hereby agrees as
follows:
7.1 Confidential
Information.
7.1.1
Non-disclosure. Except
as the Company may permit or direct in writing, during the term of
this Agreement and thereafter, the Executive agrees that the
Executive will not disclose to any person or entity any
confidential or proprietary information, knowledge or data of the
Company or any of its subsidiaries that he may have obtained while
in the employ of the Company, relating to any customers, customer
lists, methods, distribution, sales, prices, profits, costs,
contracts, inventories, suppliers, dealers, distributors, business
prospects, business methods, manufacturing ideas, formulas, plans
or techniques, research, trade secrets, or know-how of the Company
or any of its subsidiaries. Nothing contained in this Agreement shall limit
the Executive’s ability to respond to a lawful subpoena; to
make a report to or cooperate with any government agency, including
without limitation the ability to participate in an investigation,
provide information, and recover any remuneration awarded for doing
so; and to comply with any other legal
obligations.
7.1.2
Return of
Records. All records, documents, software,
computers, computer disks, hard drives and any other form of
information relating to the business of the Company or any of its
subsidiaries that are or were acquired, prepared or created for or
by the Executive or that may or did come into the Executive’s
possession during the term of the Executive’s employment with
the Company, including any and all copies thereof, shall
immediately be returned to or, as the case may be, shall remain in
the possession of the Company, as of the termination of the
Executive’s employment with the Company.
7.2 Covenant
Not to Compete. During the Executive’s
employment and for a period of one year thereafter, the Executive
agrees that he will not participate in or finance, directly or
indirectly, for himself or on behalf of any third party, anywhere
in the world, as principal, agent, employee, employer, consultant,
advisor, investor or partner, or assist in the management of, or
own any stock or any other ownership interest in, any business that
is competitive with the business of the Company and/or any of its
subsidiaries, as conducted at any time during the twelve-month
period prior to the time in question. Notwithstanding the
foregoing, the ownership of not more than one percent (1%) of the
outstanding securities of any company listed on any national
securities exchange shall not constitute a violation of this
Section, provided that the Executive’s involvement with any
such company is solely that of a passive security holder and the
Executive discloses such ownership in advance to the
Company’s Board of Directors.
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7.3 Covenant
Not to Solicit. The Executive agrees that he will
not, during the Executive’s employment and for a period of
one (1) year thereafter:
(a) directly
or indirectly, request or advise any of the customers, distributors
or dealers of the Company or any of its subsidiaries to terminate
or curtail their business with the Company or any of its
subsidiaries, or to patronize another business that is competitive
with the Company or any of its subsidiaries; or
(b) directly
or indirectly, on behalf of himself or any other person or entity,
request, advise or solicit any employee of the Company or any of
its subsidiaries to leave such employment for any
reason.
7.4 Judicial
Modification. In the event that any court of law
or equity shall consider or hold any aspect of this Section 7 to be
unreasonable or otherwise unenforceable, the parties hereto agree
that the aspect of this Section so found may be reduced or modified
by appropriate order of the court and shall thereafter continue, as
so modified, in full force and effect.
7.5 Injunctive
Relief. The parties hereto acknowledge that the
remedies at law for breach of this Section 7 will be inadequate,
and that the Company shall be entitled to injunctive relief for any
violation or threatened violation thereof; provided, however, that
nothing herein contained shall be construed as prohibiting the
Company from pursuing any other remedies available for such breach
or threatened breach, including the recovery of damages from the
Executive.
8. Inventions
and Discoveries. The Executive hereby sells,
transfers and assigns to the Company or to any person or entity
designated by the Company, all of the Executive’s right,
title and interest in and to all inventions, ideas, know how,
disclosures and improvements, whether patented or unpatented, and
copyrightable material made or conceived by the Executive, solely
or jointly, during the term hereof that relate to the products or
services of the Company or any of its subsidiaries or which
otherwise relate or pertain to the business, functions or
operations of the Company or any of its
subsidiaries. The Executive agrees to communicate
promptly and to disclose to the Company in such form as the
Executive may be reasonably requested to do so, all information,
details and data pertaining to such inventions, ideas, know how,
disclosures and improvements and to execute and deliver to the
Company such formal transfers and assignments and such other papers
and documents as may be required of the Executive to permit the
Company or any person or entity designated by the Company to file
and prosecute the applicable patent applications, and, as to
copyrightable material, to obtain copyrights thereof.
9. Tax
Withholding. All payments made and benefits
provided by the Company under this Agreement shall be reduced by
any tax or other amounts required to be withheld by the Company
under applicable law.
10. Survival
of Obligations. All obligations of the Company
and the Executive that by their nature involve performance, in any
particular instance, after the termination of the Executive’s
employment or the term of this Agreement, or that cannot be
ascertained to have been fully performed until after the
termination of Executive’s employment or the term of this
Agreement, will survive the expiration or termination of the term
of this Agreement.
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11. Officer
Resignation. Upon termination of the
Executive’s employment with the Company for any reason, the
Executive shall resign, as of the date of such termination, from
any and all director and officer positions held by the Executive
with the Company or any of its parent companies, subsidiaries or
affiliates.
12. Miscellaneous. The
following miscellaneous sections shall apply to this
Agreement:
12.1 Modifications
and Waivers. No provision of this Agreement may
be modified, waived or discharged unless that modification, waiver
or discharge is agreed to in writing by the Executive and the
Company. No waiver by either party at any time of any
breach by the other party of, or compliance with, any condition or
provision of this Agreement to be performed by that other party
shall be deemed a waiver of similar or dissimilar provisions or
conditions at the time, or at any prior or subsequent
time.
12.2 Construction
of Agreement. This Agreement supersedes any oral
or written agreements between the Executive and the Company and any
oral representations by the Company to the Executive with respect
to the subject matter of this Agreement.
12.3 Governing
Law. The validity, interpretation, construction
and performance of this Agreement will be governed by the laws of
the State of Florida, notwithstanding any conflict of law provision
to the contrary.
12.4 Severability. If
any one or more of the provisions of this Agreement, including but
not limited to Section 7 hereof, or any word, phrase, clause,
sentence or other portion of a provision is deemed illegal or
unenforceable for any reason, that provision or portion will be
modified or deleted in such a manner as to make this Agreement as
modified legal and enforceable to the fullest extent permitted
under applicable law. The validity and enforceability of
the remaining provisions or portions of this Agreement will remain
in full force and effect.
12.5 Counterparts. This
Agreement may be executed in two or more counterparts, each of
which will take effect as an original and all of which will
evidence one and the same agreement.
12.6 Successors
and Assigns. This Agreement shall be binding
upon, and shall inure to the benefit of the parties hereto and
their respective heirs, beneficiaries, personal representatives,
successors and assigns. Neither party may assign the
party’s rights or obligations under this Agreement, provided
that the Company may assign this Agreement to a parent corporation
that is created in connection with a merger of the Company with an
indirect wholly owned subsidiary as part of a holding company
reorganization.
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12.7 Entire
Agreement. This Agreement contains the entire
agreement of the parties. All prior arrangements or
understandings, whether written or oral, are merged
herein.
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date and year first above written.
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By:
/s/ Xxxxxxx X. Xxxxx
Name:
Xxxxxxx X. Xxxxx
Title:
President
Date:
March 20, 2019
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THE
EXECUTIVE
By:
/s/ Xxxxx X.
Xxxxxx
Name:
Xxxxx X. Xxxxxx
Date:
March 20, 2019
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