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EXHIBIT 10.16
EMPLOYMENT AGREEMENT
THIS AGREEMENT is between Ultrak, Inc., a Delaware corporation (the
"Company"), and Xxx Xxxxxxxxxx ("Employee").
In consideration of the terms of this Agreement, and other good and
valuable consideration, the sufficiency of which is hereby acknowledged by each
party, the Company and Employee, intending to be legally bound, hereby covenant
and agree as follows:
1. Employment. The Company hereby agrees to employ Employee, and Employee
hereby accepts employment with the Company, upon the terms and conditions
hereinafter set forth.
2. Term. Subject to the other terms of this Agreement, this Agreement
shall be effective for the period (the "First Year") from January 1, 1998
through December 31, 1999. The period from January 1 of a calendar year through
December 31 of such calendar year is hereafter referred to as a "Year." The
period during which this Agreement is effective is hereafter referred to as the
"Term." The parties may, by mutual written agreement, extend the Term beyond
December 31, 1999.
3. Duties. Employee shall be the Executive Vice President of the Company.
During the Term, Employee shall be based in Lewisville, Texas or elsewhere in
the Dallas metropolitan area (to include Collin, Dallas, Denton, Ellis, Rockwall
and Tarrant counties) only and shall perform the duties and exercise the powers
which from time to time may be lawfully assigned to or vested in him by the
Company's Board of Directors (the "Board"). It is agreed that during the Term,
Employee will not accept an officership or directorship or participate in the
operation or management of any other entity, unless it is an entity either owned
or controlled by the Company, without the prior written consent of the President
of the Company.
4. Extent of Services. Unless prevented by ill health, Employee shall
devote his entire working time, attention and energies to the business of the
Company, and shall not during the Term engage in any other business activity
whether or not such business activity is pursued for gain, profit or other
pecuniary advantage; provided, however, Employee shall not be prevented from
investing in such form or manner as will not require any services on the part of
Employee in the operation of the affairs of the companies in which such
investments are made, except that in no event may Employee make investments in
any firms in competition with, or in the business of supplying goods or services
to the Company, unless such investments are (a) disclosed in writing to and
approved by the Board and (b) do not exceed $25,000 with respect to each
investment in any privately-held company or 2% of the voting securities of any
publicly-owned company.
5. Base Salary. The Company shall pay Employee a salary (the "Base
Salary"), payable in bi-weekly installments. The Base Salary per Year shall be
$180,000 and may be increased by the Board without an amendment to this
Agreement. If Employee is absent from
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his employment because of illness which prevents Employee from performing his
duties described herein, the Company shall be obligated to pay Employee his Base
Salary and other compensation for all such periods of absence for the balance of
the Term less any applicable disability insurance actually received by Employee.
The Base Salary and any other compensation payable pursuant to this Agreement
shall be subject to appropriate tax withholding.
6. Other Compensation and Benefits.
(a) The Company currently has in effect certain bonus and stock
option plans. During the Term, Employee will be eligible to
participate in those plans currently in effect and as they may
be amended from time to time, so long as such plans remain in
existence. Furthermore, during the Term, Employee shall be
entitled to participate in all current or subsequently enacted
benefit programs applicable to all executive officers of the
Company, including the Company's 401(k) plan. For purposes of
this Agreement, all references to stock option plans, bonus plans
or benefit programs shall be deemed to mean that Employee shall
be eligible to participate in such plans or programs of the
Company in which Employee presently participates or is eligible
to participate, or such plans or programs that may subsequently
be adopted in substitution for such plans or programs.
(b) The Company will provide Employee a $300 per month car allowance.
(c) Employee shall receive four (4) weeks of paid vacation each Year.
(d) Employee shall be covered by all existing insurance programs
afforded by the Company to its executive officers. Employee
understands and agrees that he shall, as of the date hereof, be
responsible for paying for forty percent (40%) of the premiums
for health insurance coverage. Employee understands such
percentage may change.
(e) The Company will, on or about the date hereof, grant Employee an
option under Company's Stock Option Plan to purchase 20,000
shares of the Company's Common Stock.
(f) For the First Year, the Company guarantees that Employee's bonus
will be at least $75,000 assuming Employee is employed by the
Company for the entire First Year (subject to sick days and
vacation). Such bonus for the First Year will be payable on or
about March 15, 1999.
(g) Employee acknowledges that certain of Employee's relocation
expenses will be reimbursed to Employee pursuant to the Ultrak
Relocation Policy, a copy of which has previously been furnished
to Employee. In addition to the reimbursement of Employee under
the Ultrak Relocation Policy, the Company agrees that it will
reimburse Employee, up to a maximum
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reimbursement of $10,000, for the amount by which (i) Employee's
basis in his main residence in the Chicago, Illinois area exceeds
(ii) the [gross] [net] amount received by Employee in connection
with the sale, within a reasonable time prior to or following the
date of this Agreement, of Employee's main residence in the
Chicago, Illinois area.
(h) Upon execution of this Agreement, Employee will receive a
one-time signing bonus of $25,000.
(i) The Company will pay for a fully furnished executive apartment
for Employee for up to a maximum of six (6) months from the date
hereof. Employee's selection of the apartment will be subject to
the Company's prior reasonable approval.
(j) If Employee's residence in the Chicago, Illinois area is sold
by Employee at a sales price of less than $290,000, then the
Company will allow Employee to elect to receive an advance
against the guaranteed bonus payable to Employee pursuant to
Section 6(f) in an amount not to exceed the lesser of (i) the
amount by which the sales price is less than $290,000 or (ii)
$75,000.
7. Expense Reimbursement. Employee is authorized to incur reasonable
expenses with regard to the business of the Company, including expenses for
entertainment, travel and other items of a similar character in accordance with
the Company's travel and entertainment policies as such policies shall exist
from time to time (the "Policy"). The Company will reimburse Employee for all
such expenses incurred and reported by him in accordance with the Policy.
8. Termination by the Company. This Agreement may be terminated by the
giving of sixty (60) days prior written notice pursuant to Section 13 by the
Company:
(a) If Employee breaches this Agreement, and such breach, if
capable of being cured, is not cured within thirty (30) calendar
days of receipt by Employee from the Company of written notice
requiring him to cure such breach(es);
(b) If Employee shall be convicted of a criminal offense which in
the reasonable opinion of the Board may injure or tend to injure
the reputation or business of the Company;
(c) If Employee files for bankruptcy or a bankruptcy petition is
filed against Employee and, in either case, such bankruptcy
proceeding is not dismissed within ninety (90) days of being
filed;
(d) If Employee shall grossly neglect the performance of his duties
as set forth or described herein; or
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(e) If Employee becomes so addicted to alcohol, drugs or any
controlled substance that it substantially impairs his abilities
to perform his assigned duties.
9. Termination by the Company or Employee. Notwithstanding any other
provision of this Agreement, either party may terminate this Agreement by
giving notice pursuant to the terms and conditions of this Agreement.
10. Payments upon Termination or Death. It is agreed that if this
Agreement is terminated, payments and/or provisions for payments will be made
as follows:
(a) If the Company terminates this Agreement on some basis other
than the reason or reasons as stated in Section 8, or if
Employee dies, the Company will take the actions set forth in
parts (1), (2) and (3) of this Subsection 10(a). If Employee
terminates this Agreement for cause, which shall be limited to a
material breach (specified in writing by Employee) by the
Company of the terms of this Agreement, then the Company will
take the actions set forth in parts (1), (2) and (3) of this
Subsection 10(a).
(1) All stock options presently granted to Employee will become
immediately vested and shall be exercised, if ever, in
accordance with and subject to the terms and provisions of
the Company's Stock Option Plan and Employee's Stock Option
Agreement; and
(2) If Employee dies, Employee's estate will receive within
fifteen (15) days, an amount equal to all Base Salary and
all other benefits that would have accrued and/or been
payable to Employee for a period of twelve (12) months from
the date of death at Employee's then current level of
compensation, and if the Company terminates this Agreement
on some basis other than the reason or reasons stated in
Section 8 or Employee terminates this Agreement for cause,
Employee will continue to receive all Base Salary and all
other benefits for a period of one year from the date of
termination; and
(3) Any other relocation or other expense amount specifically
agreed to herein.
(b) If the Company terminates this Agreement for a reason or reasons
set forth in Section 8 or Employee terminates this Agreement
without cause, then the Company will only be obligated to pay to
Employee the actual amount of compensation accrued to the date
of termination, Employee will be bound to the terms of any Stock
Option Agreement as it relates to the exercise of any vested
stock options, and all other payments or benefits recited herein
shall be cancelled and terminated, without recourse.
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11. Non-Competition. If the Company terminates this Agreement on some
basis other than the reason or reasons stated in Section 8 or if Employee
terminates this Agreement, then for the Noncompete Period (as defined below),
Employee shall not, directly or indirectly, either as an individual, a partner
or a joint venturer, or in any other capacity, (a) invest (other than
investments in publicly-owned companies which constitute less than 2% of the
voting securities of any such company) or engage in any business that is
competitive with that of the Company, (b) accept employment with or render
services to a competitor of the Company or any of its affiliates as a director,
officer, agent, employee or consultant or (c) contact, solicit or attempt to
solicit or accept business from any customers of the Company or its affiliates
or any person or entity whose business the Company or its affiliates is
soliciting. If the Company terminates this Agreement on some basis other than
the reason or reasons stated in Section 8 or Employee terminates this Agreement
for cause, the Noncompete Period shall be the period after termination for
which Employee receives Base Salary pursuant to Section 10. If Employee
terminates this Agreement other than for cause, the Noncompete Period shall be
twelve (12) months from the date of such termination.
12. Arbitration. Any controversy or claim arising out of, or relating to
this Agreement, or the breach thereof, shall be finally resolved by binding
arbitration in Dallas, Texas in accordance with the then effective rules of the
American Arbitration Association.
13. Notices. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing, and if sent by registered or
certified mail to Employee and/or the Company at their addresses as set forth
on the signature page(s).
14. Waiver, Modification or Cancellation. Any waiver, amendment,
modification, or cancellation of any provision of this Agreement shall not be
valid unless in writing and signed by both Employee and the Company; provided,
however, that increases in the Base Salary approved by the Board or the
granting of additional compensation and/or benefits to Employee approved by the
Board need not be in a writing signed by Employee.
15. Binding Effect. This Agreement shall inure to the benefit of and be
binding upon (a) the Company and the Company's successors and assigns,
including but not limited to any entity which may acquire all or substantially
all of the Company's assets and business or with or into which the Company may
be consolidated or merged, and (b) Employee and Employee's heirs, executors,
administrators and legal representatives, provided that the duties of Employee
as described herein may not be delegated.
16. Severability. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under present or future laws, such provision
shall be fully severable and this Agreement shall be construed and enforced as
if such illegal, invalid or unenforceable provision never comprised a part
hereof; and the remaining provisions hereof shall remain in full force and
effect and shall not be affected by the illegal, invalid or unenforceable
provision or by its severance herefrom. Furthermore, in lieu of such illegal,
invalid or unenforceable provision, there shall be added automatically as part
of this Agreement, a provision as similar in its terms to such illegal, invalid
or unenforceable provision as may be possible and be legal, valid and
enforceable.
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17. Entire Agreement. This Agreement represents the entire Agreement
between the parties with respect to the subject matter hereof. Each party
represents to the other that there are no other oral, written, express or
implied contracts, agreements or understanding between them.
18. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY THE INTERNAL LAWS
OF TEXAS (AND NOT THE CONFLICTS OF LAWS RULES OF TEXAS).
19. Specific Representations. Each party represents to the other that:
(a) The consideration recited herein shall conclusively be deemed
fair, adequate, reasonable and sufficient.
(b) Such party has voluntarily and without fraud, duress, coercion,
undue influence or improper persuasion executed this Agreement.
(c) The signature appearing below is such party's manual, original,
genuine, authentic and undeniable signature.
(d) Such party is competent, authorized and capable of executing this
Agreement as a valid, binding and enforceable agreement.
(e) Such party is not aware of any agreement, document or commitment
that would limit such party's ability to fully comply with the
terms of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of December
__, 1997.
Address:
0000 Xxxxx X'Xxxxx Xx. /s/ XXX XXXXXXXXXX
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Xxxxxxxx, XX 00000 XXX XXXXXXXXXX
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Address: ULTRAK, INC.
0000 Xxxxxxxx Xxxxxx
Xxxxx 000 By: /s/ XXXXX X. XXXXXXXXX
Xxxxxxxxxx, Xxxxx 00000 ------------------------
Its: President
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