Employment Agreement
This Employment Agreement ("Agreement") is made effective as of the 1st day
of October 2000. by and between ValCom, Inc., a Delaware corporation (the
"Corporation") and Vince M Vellardita ("Employee").
WHEREAS, the Corporation and Employee desire to enter into this Employment
Agreement to insure the Corporation of the services of Employee during the term
hereof and to insure Employee of his continued employment by the Corporation;
NOW, THEREFORE, in consideration of the premises and the mutual covenants and
agreements herein set forth, the parties hereto agree as follows:
1. Employment. The Corporation hereby employs Employee and Employee hereby
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accepts such employment by the Corporation upon the terms and conditions
hereinafter set forth, all other agreements, arrangements and undertakings
between the Corporation and Employee with respect to employment being superseded
hereby for all purposes.
2. Term. The term of said employment shall be for five (5) years,
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beginning on October 1, 2000 and, subject to Paragraph 8, terminating on
September 30, 2005, unless extended pursuant to Paragraph 9.
3. Compensation. As compensation for all services he may render to the
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Corporation, the Corporation shall pay to Employee:
3.1. An annual salary of $120,000.00 for the first year beginning
October 1, 2000 and ending September 30, 2001. $150,000.00 for the second year
beginning October 1, 2001 and ending September 30, 2002, and $200,000.00 for the
third year beginning October 1, 2002 and ending September 30, 2003; plus
3.2. Such bonus that may, but need not be, be declared and paid from
time to time in the sole and absolute discretion of the Board of Directors of
the Corporation or duly-authorized Compensation Committee thereof, after taking
into consideration the performance of the Corporation, profitability, working
capital requirements and such other factors as shall be determined by the Board
of Directors of the Corporation or the duly-authorized Compensation Committee
thereof.
4. Duties. For the entire term of this Employment Agreement, Employee shall
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be employed in the capacity of President and Chief Executive Officer of the
Corporation. As, President and Chief Executive Officer, Employee shall do and
perform all services or acts necessary or advisable, subject to the policies set
by the Board of Directors of the Corporation. As President and Chief Financial
Officer, Employee shall have such powers and authorities as shall be conferred
by the Board of Directors of the Corporation.
5. Extent of Services.
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5.1. For the full terms of this Employment Agreement, Employee shall
devote substantially all of this attention, abilities and energies to the
business of the Corporation during regular business hours.
5.2. Employee shall not, without the prior written, consent of the
Corporation, or unless otherwise permitted pursuant to this Paragraph 5,
directly or indirectly, during the term of this Employment Agreement, engage in
any activity competitive with or adverse to the Corporation's business or
welfare, whether alone, as a partner, or as an officer, director, employee or
shareholder of any other business entity, except that the ownership of not more
than five percent (5%) of the equity securities of any publicly traded
corporation shall not be deemed a violation of this paragraph 5.2,
5.3. During the term of employment, Employee will have access to and
acquire various confidential knowledge, including without limitation
compilations of information, which are owned by the Corporation and which are
regularly used by the Corporation in the operation of its business. Employee
shall not disclose any of the aforesaid trade secrets, directly or indirectly,
or use them in any way, either during the term of this Employment Agreement or
at any time thereafter, except as required in the course of his employment. All
files, records, documents and, other items relating to the business of the
Corporation, whether prepared by Employee or otherwise corning into his
possession, shall remain the exclusive property of the Corporation.
6. Benefits.
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6.1. Employee shall receive medical and disability insurance and
other fringe benefits on a basis not less favorable as the same are extended to
other key employees of the Corporation.
6.2. Employee shall be entitled in each year of the term of this
Employment Agreement to such vacation and sick leave as shall be determined by
the Board of Directors, during which time his compensation pursuant to Paragraph
3 hereof, shall be paid in full.
6.3. Throughout the term of this Agreement, The Corporation shall
provide and pay for a mobile telephone and a credit card for Employee's use for
gas and company related expenses.
7. Expenses. Subject to written policies, which may be established from
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time to time by the Board of Directors of the Corporation, Employee is
authorized to incur reasonable expenses in performing his obligations hereunder,
including expenses for entertainment, travel and similar items. The Corporation
agrees to reimburse Employee for all such expenses upon presentation from time
to time of itemized accounts of such expenditures,
8. Termination.
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8.1. The employment of Employee hereunder may be terminated at any
time by action of the Corporation's Board of Directors:
8.1.1. Upon thirty (30) days prior written notice in the event of
illness or permanent disability of Employee resulting in a failure to discharge
substantially his duties under this Employment Agreement for a period of six (6)
consecutive months or a total of two hundred ten (210) days during any calendar
year, and upon such termination, Employee shall be entitled to receive and shall
be paid all compensation pursuant to Paragraph 3 hereof through and including
the date of termination; or
8.1.2. At any time upon the occurrence of any one or more of the
following events:
8.1.2.1. Employee's repeated intentional failure or refusal to
perform such duties consistent with his capacity as Director of the Corporation;
8.1.2.2. Employee's fraud, dishonesty or other willful misconduct in
the performance of services on behalf of the Corporation; or
8.1.2.3. A material breach of any provision of this Employment
Agreement that has not been corrected by Employee within thirty (30) days after
receipt by him of written notice of such breach, in which case the Corporation
shall not be required to pay any further compensation to Employee, Termination
of Employee's employment under this Paragraph 8 shall not be in limitation of
any other right or remedy that the Corporation may have under this Employment
Agreement or otherwise.
8.2 Employee may terminate this Employment Agreement upon a material breach
of any provision of this Employment Agreement by the Corporation that has not
been corrected by the Corporation within thirty (30) days after receipt by it of
written notice of such breach.
8.3 This Employment Agreement shall not be terminated by any of the
following:
8.3.1 Merger or consolidation where the Corporation is not the
resulting or surviving corporation or entity; or
8.3.2 Transfer of substantially all of the assets of the Corporation.
In the event of any such merger, consolidation or transfer of assets, the
surviving or resulting corporation or entity or the transferee of the
Corporation's assets shall remain bound by and shall continue to obtain the
benefits of the provisions of this Agreement.
9. Renewal. This Employment Agreement shall be automatically renewed for
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successive one (1) year periods, unless written notice of termination is given
by one party to the other party not less than three (3) months prior to the end
of the term hereof or any renewal hereof. For any renewal period, the
compensation to be paid by the Corporation to Employee shall be as mutually
determined by the Corporation and Employee but is to be not less than the amount
paid pursuant to Paragraph 3.1.
10. Severable Provisions. The provisions of this Employment Agreement are
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severable, and if any one or more provisions are determined to be illegal or
otherwise unenforceable, in whole or in part, the remaining provisions shall
nevertheless be binding and enforceable.
11. Waiver. Either party's failure to enforce any provision or provisions
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of this Employment Agreement shall not in any way be construed as a waiver of
any such provision, or provisions as to any future violation thereof, nor
prevent that party thereafter from enforcing each and every other provision of
this Employment Agreement. The rights granted to both parties hereunder are
cumulative and waiver of any single remedy shall not constitute a waiver of
either party's right to assert all other legal remedies available to him or it
under the circumstances.
12. Merger Clause. This Employment Agreement supersedes all prior
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agreements and understandings between the parties and may not be modified,
waived or terminated orally. No attempted modification, waiver or termination
shall be valid unless in writing and signed by the party against whom the same
is sought to be enforced.
13. Governing Law. This Employment Agreement shall be governed by and
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construed in accordance with the laws of the State of California,
IN WITNESS WHEREOF, the parties hereto have duly executed this Employment
Agreement effective as of the date and year first set forth above.
Valcom, Inc.
By: /s/ Ron Foster
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Ron Foster, its Secretary
And Executive Vice President
/s/ Vince Vellardita
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Vince Vellardita