Document:

Exhibit
10.1

 

INDEMNIFICATION
AGREEMENT

 

 

This Agreement made and
entered into this     day of    , (the “Agreement”),
by and between Ezenia! Inc., a Delaware corporation (the “Company,” which term
shall include, where appropriate, any Entity (as hereinafter defined)
controlled directly or indirectly by the Company and                 
(the “Indemnitee”):

 

WHEREAS, it is essential
to the Company that it be able to retain and attract as directors &
officers the most capable persons available;

 

WHEREAS, increased
corporate litigation has subjected directors & officers to litigation
risks and expenses, and the limitations on the availability of directors and
officers liability insurance have made it increasingly difficult for the
Company to attract and retain such persons;

 

WHEREAS, the Company’s Certificate of Incorporation and By-laws (the
“Certificate of Incorporation” and “By-laws,” respectively) require it
to indemnify its directors &
officers to the fullest extent permitted by law and permit it to make other
indemnification arrangements and agreements;

 

WHEREAS, the Company
desires to provide Indemnitee with specific contractual assurance of Indemnitee’s
rights to full indemnification against litigation risks and expenses
(regardless, among other things, of any amendment to or revocation of the Certificate of Incorporation or By-laws
or any change in the ownership of the Company or the composition of its Board
of Directors);

 

WHEREAS, the Company
intends that this Agreement provide Indemnitee with greater protection than
that which is provided by the Company’s Certificate
of Incorporation and By-laws; and

 

WHEREAS, Indemnitee is
relying upon the rights afforded under this Agreement in continuing as  a director or officer of the Company.

 

NOW, THEREFORE, in consideration
of the promises and the covenants contained herein, the Company and Indemnitee
do hereby covenant and agree as follows:

 

1.             Definitions.

 

(a)           “Corporate
Status” describes the status of a person who is serving or has served (i) as
a director of the Company or officer of the company,  (ii) in any capacity with respect to any employee
benefit plan of the Company, or (iii) as a director, partner, trustee,
officer, employee, or agent of any other Entity at the

 

 

request of the Company.  For purposes of subsection (iii) of this
Section 1(a), if Indemnitee  is
serving or has served as a director, partner, trustee, officer, employee or
agent of a Subsidiary, Indemnitee shall be deemed to be serving at the request
of the Company.

 

(b)           “Entity”
shall mean any corporation, partnership, limited liability company, joint
venture, trust, foundation, association, organization or other legal entity.

 

(c)           “Expenses”
shall mean all fees, costs and expenses incurred by Indemnitee in connection
with any Proceeding (as defined below), including, without limitation,
attorneys’ fees, disbursements and retainers (including, without limitation,
any such fees, disbursements and retainers incurred by Indemnitee pursuant to
Sections 11 and 12(c) of this Agreement), fees and disbursements of
expert witnesses, private investigators and professional advisors (including,
without limitation, accountants and investment bankers), court costs,
transcript costs, fees of experts, travel expenses, duplicating, printing and
binding costs, telephone and fax transmission charges, postage, delivery
services, secretarial services, and other disbursements and expenses.

 

(d)           “Indemnifiable
Expenses,” “Indemnifiable Liabilities” and “Indemnifiable Amounts” shall have
the meanings ascribed to those terms in Section 3(a) below.

 

(e)           “Liabilities”
shall mean judgments, damages, liabilities, losses, penalties, excise taxes,
fines and amounts paid in settlement.

 

(f)            “Proceeding”
shall mean any threatened, pending or completed claim, action, suit, arbitration,
alternate dispute resolution process, investigation, administrative hearing,
appeal, or any other proceeding, whether civil, criminal, administrative,
arbitrative or investigative, whether formal or informal, including a
proceeding initiated by Indemnitee pursuant to Section 11 of this
Agreement to enforce Indemnitee’s rights hereunder.

 

(g)           “Subsidiary” shall mean any
corporation, partnership, limited liability company, joint venture, trust or
other Entity of which the Company owns (either directly or through or together
with another Subsidiary of the Company) either (i) a general partner,
managing member or other similar interest or (ii) (A) 50% or more of
the voting power of the voting capital equity interests of such corporation,
partnership, limited liability company, joint venture or other Entity, or (B) 50%
or more of the outstanding voting capital stock or other voting equity
interests of such corporation, partnership, limited liability company, joint
venture or other Entity.

 

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2.             Services
of Indemnitee.  In
consideration of the Company’s covenants and commitments hereunder, Indemnitee
agrees to serve or continue to serve as a director or officer of the
Company.  However, this Agreement shall not
impose any obligation on Indemnitee or the Company to continue Indemnitee’s
service to the Company beyond any period otherwise required by law or by other
agreements or commitments of the parties, if any.

 

3.             Agreement
to Indemnify.  The
Company agrees to indemnify Indemnitee as follows:

 

(a)           Proceedings
Other Than By or In the Right of the Company.  Subject to the exceptions contained in Section 4(a) below,
if Indemnitee was or is a party or is threatened to be made a party to any
Proceeding (other than an action by or in the right of the Company) by reason
of Indemnitee’s Corporate Status, Indemnitee shall be indemnified by the
Company against all Expenses and Liabilities incurred or paid by Indemnitee in
connection with such Proceeding (referred to herein as “Indemnifiable Expenses”
and “Indemnifiable Liabilities,” respectively, and collectively as “Indemnifiable
Amounts”).

 

(b)           Proceedings
By or In the Right of the Company. 
Subject to the exceptions contained in Section 4(b) below, if
Indemnitee was or is a party or is threatened to be made a party to any
Proceeding by or in the right of the Company by reason of Indemnitee’s
Corporate Status, Indemnitee shall be indemnified by the Company against all
Indemnifiable Expenses.

 

(c)           Conclusive Presumption Regarding
Standard of Care.  In making any
determination required to be made under Delaware law with respect to
entitlement to indemnification hereunder, the person, persons or entity making
such determination shall presume that Indemnitee is entitled to indemnification
under this Agreement if Indemnitee submitted a request therefor in accordance
with Section 5 of this Agreement, and the Company shall have the burden of
proof to overcome that presumption in connection with the making by any person,
persons or entity of any determination contrary to that presumption.

 

4.             Exceptions
to Indemnification.  Indemnitee
shall be entitled to indemnification under Sections 3(a) and 3(b) above
in all circumstances other than with respect to any specific claim, issue or
matter involved in the Proceeding out of which Indemnitee’s claim for
indemnification has arisen, as follows:

 

(a)           Proceedings
Other Than By or In the Right of the Company.  If indemnification is requested under Section 3(a) and
it has been finally adjudicated by a court of competent jurisdiction that, in
connection with such specific claim,

 

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issue or matter, Indemnitee failed to act (i) in good
faith and (ii) in a manner Indemnitee reasonably believed to be in or not
opposed to the best interests of the Company, or, with respect to any criminal
Proceeding, Indemnitee had reasonable cause to believe that Indemnitee’s
conduct was unlawful, Indemnitee shall not be entitled to payment of
Indemnifiable Amounts hereunder.

 

(b)           Proceedings
By or In the Right of the Company. 
If indemnification is requested under Section 3(b) and

 

(i) it has been
finally adjudicated by a court of competent jurisdiction that, in connection
with such specific claim, issue or matter, Indemnitee failed to act (A) in
good faith and (B) in a manner Indemnitee reasonably believed to be in or
not opposed to the best interests of the Company, Indemnitee shall not be
entitled to payment of Indemnifiable Expenses hereunder; or

 

(ii) it has been
finally adjudicated by a court of competent jurisdiction that Indemnitee is
liable to the Company with respect to such specific claim, Indemnitee shall not
be entitled to payment of Indemnifiable Expenses hereunder with respect to such
claim, issue or matter unless the Court of Chancery or another court in which
such Proceeding was brought shall determine upon application that, despite the
adjudication of liability, but in view of all the circumstances of the case,
Indemnitee is fairly and reasonably entitled to indemnification for such
Indemnifiable Expenses which such court shall deem proper; or

 

(iii) it has been
finally adjudicated by a court of competent jurisdiction that Indemnitee is
liable to the Company for an accounting of profits made from the purchase or
sale by the Indemnitee of securities of the Company pursuant to the provisions
of Section 16(b) of the Securities Exchange Act of 1934, the rules and
regulations promulgated thereunder and amendments thereto or similar provisions
of any federal, state or local statutory law, Indemnitee shall not be entitled
to payment of Indemnifiable Expenses hereunder.

 

(c)           Insurance
Proceeds.  To the extent payment is
actually made to the Indemnitee under a valid and collectible insurance policy
in respect of Indemnifiable Amounts in connection with such specific claim,
issue or matter, Indemnitee shall not be entitled to payment of Indemnifiable
Amounts hereunder except in respect of any excess beyond the amount of payment
under such insurance.

 

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5.             Procedure
for Payment of Indemnifiable Amounts. 
Indemnitee shall submit to the Company a written request specifying the
Indemnifiable Amounts for which Indemnitee seeks payment under Section 3
of this Agreement and the basis for the claim. 
The Company shall pay such Indemnifiable Amounts to Indemnitee promptly
upon receipt of its request.  At the
request of the Company, Indemnitee shall furnish such documentation and
information as are reasonably available to Indemnitee and necessary to
establish that Indemnitee is entitled to indemnification hereunder.

 

6.             Indemnification
for Expenses of a Party Who is Wholly or Partly Successful.  Notwithstanding
any other provision of this Agreement, and without limiting any such provision,
to the extent that Indemnitee is, by reason of Indemnitee’s Corporate Status, a
party to and is successful, on the merits or otherwise, in any Proceeding,
Indemnitee shall be indemnified against all Expenses reasonably incurred by
Indemnitee or on Indemnitee’s behalf in connection therewith.  If Indemnitee is not wholly successful in
such Proceeding but is successful, on the merits or otherwise, as to one or
more but less than all claims, issues or matters in such Proceeding, the
Company shall indemnify Indemnitee against all Expenses reasonably incurred by
Indemnitee or on Indemnitee’s behalf in connection with each successfully
resolved claim, issue or matter.  For
purposes of this Agreement, the termination of any claim, issue or matter in
such a Proceeding by dismissal, with or without prejudice, by reason of
settlement, judgment, order or otherwise, shall be deemed to be a successful
result as to such claim, issue or matter.

 

7.             Effect of
Certain Resolutions.  Neither the
settlement or termination of any Proceeding nor the failure of the Company to
award indemnification or to determine that indemnification is payable shall
create a presumption that Indemnitee is not entitled to indemnification
hereunder.  In addition, the termination
of any proceeding by judgment, order, settlement, conviction, or upon a plea of
nolo contendere or its equivalent shall not create a presumption that
Indemnitee did not act in good faith and in a manner which Indemnitee
reasonably believed to be in or not opposed to the best interests of the
Company or, with respect to any criminal Proceeding, had reasonable cause to
believe that Indemnitee’s action was unlawful.

 

8.             Agreement to
Advance Expenses; Undertaking.  The
Company shall advance all Expenses incurred by or on behalf of Indemnitee in
connection with any Proceeding, including a Proceeding by or in the right of
the Company, in which Indemnitee is involved by reason of such Indemnitee’s
Corporate Status within thirty (30) calendar days after the receipt by the Company
of a written statement from Indemnitee requesting such advance or advances from
time to time, whether prior to or after final disposition of such
Proceeding.  Advances shall be unsecured
and interest free.  Advances shall be
made without regard to Indemnitee’s ability to repay the expenses and without
regard to Indemnitee’s ultimate entitlement to indemnification under the other
provisions of this Agreement.  To the
extent required by Delaware law, Indemnitee hereby undertakes to repay any and
all of the amount of Indemnifiable Expenses paid to Indemnitee if it is finally
determined by a court of competent jurisdiction that Indemnitee is not entitled
under this Agreement to indemnification with respect to such Expenses.  This undertaking is an unlimited general
obligation of Indemnitee.

 

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9.             Procedure
for Advance Payment of Expenses. 
Indemnitee shall submit to the Company a written request specifying the
Indemnifiable Expenses for which Indemnitee seeks an advancement under Section 8
of this Agreement, together with documentation evidencing that Indemnitee has
incurred such Indemnifiable Expenses. 
Payment of Indemnifiable Expenses under Section 8 shall be made no
later than thirty (30) calendar days after the Company’s receipt of such
request.

 

10.          Indemnification for Expenses of a
Witness.  Notwithstanding any other
provision of this Agreement, to the extent that Indemnitee is, by reason of his
Corporate Status, a witness in any Proceeding to which Indemnitee is not a
party, he shall be indemnified against all Expenses actually and reasonably
incurred by him or on his behalf in connection therewith.

 

11.          Remedies
of Indemnitee.

 

(a)           Right
to Petition Court.  In the event that
Indemnitee makes a request for payment of Indemnifiable Amounts under Sections
3 and 5 above or a request for an advancement of Indemnifiable Expenses
under Sections 8 and 9 above and the Company fails to make such payment or
advancement in a timely manner pursuant to the terms of this Agreement,
Indemnitee may petition the Court of Chancery to enforce the Company’s obligations
under this Agreement.

 

(b)           Burden
of Proof.  In any judicial proceeding
brought under Section 11(a) above, the Company shall have the burden
of proving that Indemnitee is not entitled to payment of Indemnifiable Amounts
hereunder.

 

(c)           Expenses.
 The Company agrees to reimburse
Indemnitee in full for any Expenses incurred by Indemnitee in connection with
investigating, preparing for, litigating, defending or settling any action
brought by Indemnitee under Section 11(a) above, or in connection
with any claim or counterclaim brought by the Company in connection therewith,
whether or not Indemnitee is successful in whole or in part in connection with
any such action.

 

(d)           Failure
to Act Not a Defense.  The failure of
the Company (including its Board of Directors or any committee thereof,
independent legal counsel, or stockholders) to make a determination concerning
the permissibility of the payment of Indemnifiable Amounts or the advancement
of Indemnifiable Expenses under this Agreement shall not be a defense in any
action brought under Section 11(a) above, and shall not create a
presumption that such payment or advancement is not permissible.

 

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12.          Defense
of the Underlying Proceeding.

 

(a)           Notice by Indemnitee.  Indemnitee agrees to notify the Company
promptly upon being served with any summons, citation, subpoena, complaint,
indictment, information, or other document relating to any Proceeding which may
result in the payment of Indemnifiable Amounts or the advancement of
Indemnifiable Expenses hereunder; provided, however, that the failure to give
any such notice shall not disqualify Indemnitee from the right, or otherwise
affect in any manner any right of Indemnitee, to receive payments of Indemnifiable
Amounts or advancements of Indemnifiable Expenses unless the Company’s ability
to defend in such Proceeding is materially and adversely prejudiced thereby.

 

(b)           Defense by Company.  Subject to the provisions of the last
sentence of this Section 12(b) and of Section 12(c) below,
the Company shall have the right to defend Indemnitee in any Proceeding which
may give rise to the payment of Indemnifiable Amounts hereunder; provided,
however that the Company shall notify Indemnitee of any such decision to defend
within ten (10) calendar days of receipt of notice of any such Proceeding
under Section 12(a) above.  The
Company shall not, without the prior written consent of Indemnitee, consent to
the entry of any judgment against Indemnitee or enter into any settlement or
compromise which (i) includes an admission of fault of Indemnitee or (ii) does
not include, as an unconditional term thereof, the full release of Indemnitee
from all liability in respect of such Proceeding, which release shall be in
form and substance reasonably satisfactory to Indemnitee.  This Section 12(b) shall not apply
to a Proceeding brought by Indemnitee under Section 11(a) above or
pursuant to Section 20 below.

 

(c)           Indemnitee’s Right to Counsel.  Notwithstanding the provisions of Section 12(b) above,
if in a Proceeding to which Indemnitee is a party by reason of Indemnitee’s
Corporate Status, (i) Indemnitee reasonably concludes that he or she may
have separate defenses or counterclaims to assert with respect to any issue
which may not be consistent with the position of other defendants in such
Proceeding, (ii) a conflict of interest or potential conflict of interest
exists between Indemnitee and the Company, or (iii) if the Company fails
to assume the defense of such proceeding in a timely manner, Indemnitee shall
be entitled to be represented by separate legal counsel of Indemnitee’s choice
at the expense of the Company.  In
addition, if the Company fails to comply with any of its obligations under this
Agreement or in the event that the Company or any other person takes any action
to declare this Agreement void or unenforceable, or institutes any action, suit
or proceeding to deny or to recover from Indemnitee the benefits intended to be
provided to Indemnitee hereunder, Indemnitee shall have the right to retain
counsel of Indemnitee’s choice, at the expense of the Company, to represent
Indemnitee in connection with any such matter.

 

13.          Representations
and Warranties of the Company.  The
Company hereby represents and warrants to Indemnitee as follows:

 

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(a)           Authority.  The Company has all necessary power and
authority to enter into, and be bound by the terms of, this Agreement, and the
execution, delivery and performance of the undertakings contemplated by this
Agreement have been duly authorized by the Company.

 

(b)           Enforceability.  This Agreement, when executed and delivered
by the Company in accordance with the provisions hereof, shall be a legal,
valid and binding obligation of the Company, enforceable against the Company in
accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, moratorium, reorganization or similar laws
affecting the enforcement of creditors’ rights generally.

 

14.          Insurance.  The Company shall, from time to time, make
the good faith determination whether or not it is practicable for the Company
to obtain and maintain a policy or policies of insurance with a reputable
insurance company providing the Indemnitee with coverage for losses from
wrongful acts.  For so long as Indemnitee
shall remain a director or officer of the Company and with respect to any such
prior service, in all policies of director and officer liability insurance,
Indemnitee shall be named as an insured in such a manner as to provide
Indemnitee the same rights and benefits as are afforded to the most favorably
insured of the Company’s officers and directors.  Notwithstanding the foregoing, the Company
shall have no obligation to obtain or maintain such insurance if the Company
determines in good faith that such insurance is not reasonably available, if
the premium costs for such insurance are disproportionate to the amount of
coverage provided, or if the coverage provided by such insurance is limited by
exclusions so as to provide an insufficient benefit. The Company shall promptly
notify Indemnitee of any good faith determination not to provide such coverage.

 

15.          Contract
Rights Not Exclusive.  The rights to
payment of Indemnifiable Amounts and advancement of Indemnifiable Expenses
provided by this Agreement shall be in addition to, but not exclusive of, any
other rights which Indemnitee may have at any time under applicable law, the
Company’s Certificate of Incorporation or By-laws, or any other agreement, vote
of stockholders or directors (or a committee of directors), or otherwise, both
as to action in Indemnitee’s official capacity and as to action in any other
capacity as a result of Indemnitee’s serving as a  director or officer of the Company.

 

16.          Successors.  This Agreement shall be (a) binding upon
all successors and assigns of the Company (including any transferee of all or a
substantial portion of the business, stock and/or assets of the Company and any
direct or indirect successor by merger or consolidation or otherwise by
operation of law) and (b) binding on and shall inure to the benefit of the
heirs, personal representatives, executors and administrators of
Indemnitee.  This Agreement shall
continue for the benefit of Indemnitee and such heirs, personal
representatives, executors and administrators after Indemnitee has ceased to
have Corporate Status.

 

17.          Subrogation.  In the event of any payment of Indemnifiable
Amounts under this Agreement, the Company shall be subrogated to the extent of
such payment to all of the rights of contribution or recovery of Indemnitee
against other persons, and Indemnitee shall take, at the 

 

8

 

request of the Company, all reasonable action necessary to secure such
rights, including the execution of such documents as are necessary to enable
the Company to bring suit to enforce such rights.

 

18.          Change
in Law.  To the extent that a change
in Delaware law (whether by statute or judicial decision) shall permit broader
indemnification or advancement of expenses 
than is provided under the terms of the By-laws and this Agreement,
Indemnitee shall be entitled to such broader indemnification and advancements,
and this Agreement shall be deemed to be amended to such extent.

 

19.          Severability.  Whenever possible, each provision of this
Agreement shall be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement, or any clause
thereof, shall be determined by a court of competent jurisdiction to be
illegal, invalid or unenforceable, in whole or in part, such provision or
clause shall be limited or modified in its application to the minimum extent
necessary to make such provision or clause valid, legal and enforceable, and
the remaining provisions and clauses of this Agreement shall remain fully
enforceable and binding on the parties.

 

20.          Indemnitee
as Plaintiff.  Except as provided in Section 10(c) of
this Agreement and in the next sentence, Indemnitee shall not be entitled to
payment of Indemnifiable Amounts or advancement of Indemnifiable Expenses with
respect to any Proceeding brought by Indemnitee against the Company, any Entity
which it controls, any director or officer thereof, or any third party, unless
the Board of Directors of the Company has consented to the initiation of such
Proceeding.  This Section shall not
apply to counterclaims or affirmative defenses asserted by Indemnitee in an
action brought against Indemnitee.

 

21.          Modifications
and Waiver.  Except as provided in Section 18
above with respect to changes in Delaware law which broaden the right of
Indemnitee to be indemnified by the Company, no supplement, modification or
amendment of this Agreement shall be binding unless executed in writing by each
of the parties hereto.  No waiver of any
of the provisions of this Agreement shall be deemed or shall constitute a
waiver of any other provisions of this Agreement (whether or not similar), nor
shall such waiver constitute a continuing waiver.

 

22.          General
Notices.  All notices, requests,
demands and other communications hereunder shall be in writing and shall be
deemed to have been duly given (a) when delivered by hand, (b) when
transmitted by facsimile and receipt is acknowledged, or (c) if mailed by
certified or registered mail with postage prepaid, on the third business day
after the date on which it is so mailed:

 

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(i)            If to Indemnitee, to:

 

 

 

 

(ii)           If to the Company, to:

 

 

 

 

or to such other address
as may have been furnished in the same manner by any party to the others.

 

23.          Governing
Law; Consent to Jurisdiction; Service of Process.  This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware without regard
to its rules of conflict of laws. 
Each of the Company and the Indemnitee hereby irrevocably and
unconditionally consents to submit to the exclusive jurisdiction of the Court
of Chancery of the State of Delaware and the courts of the United States of
America located in the State of Delaware (the “Delaware Courts”) for any
litigation arising out of or relating to this Agreement and the transactions
contemplated hereby (and agrees not to commence any litigation relating thereto
except in such courts), waives any objection to the laying of venue of any such
litigation in the Delaware Courts and agrees not to plead or claim in any
Delaware Court that such litigation brought therein has been brought in an
inconvenient forum.  Each of the parties
hereto agrees, (a) to the extent such party is not otherwise subject to
service of process in the State of Delaware, to appoint and maintain an agent
in the State of Delaware as such party’s agent for acceptance of legal process,
and (b) that service of process may also be made on such party by prepaid
certified mail with a proof of mailing receipt validated by the United States
Postal Service constituting evidence of valid service.  Service made pursuant to (a) or (b) above
shall have the same legal force and effect as if served upon such party
personally within the State of Delaware. 
For purposes of implementing the parties’ agreement to appoint and
maintain an agent for service of process in the State of Delaware, each such
party does hereby appoint The Corporation Trust Company, 1209 Orange Street,
Wilmington, New Castle County, Delaware 19801, as such agent and each such
party hereby agrees to complete all actions necessary for such appointment.

 

[signature page follows]

 

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IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day
and year first above written.

 

 

	
   

  	
   

  	
  Ezenia! Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  INDEMNITEE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:EMPLOYMENT AGREEMENT

                  This Employment Agreement ("Agreement") is made as of December
29, 2008, between DECORATOR INDUSTRIES, INC. (the "Company" or "Employer"), a
Pennsylvania corporation, and WILLIAM BASSETT ("Employee"), of Pasco County,
Florida.

                  WHEREAS, Employee has been President and Chief Executive
Officer of the Company, in which capacity his services have contributed
materially to the successful operation of the Company's business;

                  WHEREAS, the parties entered into an employment agreement,
dated August 2, 1994, and amended both on July 29, 2003 and on May 25, 2004
(collectively the "Prior Agreement"), and insofar as the Prior Agreement
addressed the employment of Employee on and after January 1, 2008, the parties
through this Agreement rescind and revoke the Prior Agreement, and enter into
this Agreement to address the terms and conditions of Employee's employment by
the Company on and after January 1, 2008.

                  NOW, THEREFORE, intending to be legally bound hereby, the
Company hereby agrees to employ Employee, and Employee hereby agrees to be
employed by the Company, upon the following terms and conditions:

         1. TERM. The Company will employ Employee and Employee accepts
employment with the Company on the terms and conditions herein from January 1,
2008 until December 31, 2012 (the "Term"), unless earlier terminated as provided
in paragraph 8.

         2. DUTIES. Employee shall use his best energies and abilities in
performing such services and duties as are assigned to him by the Company's
Board of Directors, and as he deems reasonably necessary for the benefit of the
Company, in the capacity as an executive level consultant and adviser to the
Company. His duties shall include assistance and advice to the President of the
Company, review and advice regarding the Company's financial matters, strategic
planning, and both due diligence for and the negotiation of acquisitions by the
Company.

         3. COMPENSATION. During the Term of this Agreement, subject to the
provisions of Sections 8 and 9, the Company shall pay to the Employee a base
annual salary of $216,000, payable in monthly installments of $18,000 in
accordance with the Company's established payroll policies.

         4. HEALTH INSURANCE BENEFITS.

             (a) During Employee's employment hereunder and subsequently for the
         life of Employee and/or his spouse, Employer shall pay or reimburse, as
         applicable, the following:

                 (i) the premiums required for the Employee and/or his spouse to
              participate in the Employer's group health plans. If Employee
              and/or his spouse are not eligible to participate in such group

<PAGE>

              health plans, or if no such plans are maintained, the Employer
              shall reimburse the premiums required for Employee and/or his
              spouse to participate in Medicare Parts A, B and D (or other
              government health plan replacing Medicare) that would otherwise be
              borne by Employee, and the premiums for Medicare Supplement
              (Medigap) insurance coverage; and

                 (ii) premiums for a long-term care policy or policies, procured
              by the Company, covering Employee and his spouse; provided that,
              to the extent that such premiums on an annual basis exceed
              $10,744.98, Employee shall be responsible for paying such excess.

             (b) Without limitation of the provisions of Section 4(a), the
         following provisions shall apply after the termination of Employee's
         employment:

                 (i) During COBRA Continuation Period. To the extent permitted
              by applicable law and Employer's benefit plans, Employer shall
              maintain Employee's paid coverage for health insurance through the
              payment of Employee's COBRA premiums until the expiration of the
              COBRA Continuation Period. During the applicable period of
              coverage described in the foregoing sentence, the Employee shall
              be entitled to benefits, on substantially the same basis as would
              have otherwise been provided had Employee not been terminated. To
              the extent that such benefits are available under Employer's
              benefit plans and Employee had such coverage immediately prior to
              termination of employment, such continuation of benefits for
              Employee shall also cover the Employee's dependents for so long as
              Employee is receiving such benefits under this Section 4(b)(i).
              The COBRA Continuation Period for health insurance under this
              Section 4(b)(i) shall be deemed to run concurrent with the
              continuation period federally mandated by COBRA (generally 18
              months), or any other legally mandated and applicable federal,
              state, or local coverage period for benefits provided to
              terminated employees under the health care plan(s).

                 (ii) After COBRA Continuation Period. Following the conclusion
              of the COBRA Continuation Period described above (or, if sooner,
              the cessation of such coverage), Employer will reimburse Employee
              (or Employee's spouse, as applicable, net of applicable
              withholdings required by law) for the premium for Employee and/or
              his spouse to participate in Medicare Parts A, B and D (or other
              government health plan replacing Medicare), including the premiums
              for Medicare Supplement (Medigap) insurance coverage that would
              otherwise be borne by Employee.

         5.       LIFE INSURANCE.

             (a) The Company shall continue during Employee's employment
         hereunder to reimburse (net of applicable withholdings required by law)
         Employee for the premiums Employee pays on General American Life Ins.
         Policy No. 612860 (Policy 612860), so long as Policy 612860 is in
         effect. If Employee cancels, suspends or surrenders Policy 612860, he
         shall notify the Company before doing so, but giving such notice shall
         not create any right in the Company to make any claim against Policy
         612860.

                                       -2-
<PAGE>

             (b) On or before December 31, 2008, the Company shall transfer
         American General Life Ins. Policy No. U10017109L ("Policy 10017109L")
         to Employee, and shall thereafter during Employee's employment
         hereunder reimburse (net of applicable withholdings required by law and
         plus the Gross-Up Payment (net of applicable withholdings) provided for
         in Section 7(b)) Employee for the premiums Employee pays on Policy
         10017109L. If Employee cancels, suspends or surrenders Policy
         10017109L, he shall notify the Company before doing so, but giving such
         notice shall not create any right in the Company to make any claim
         against Policy 10017109L.

         6. OTHER FRINGE BENEFITS.

             (a) During Employee's employment hereunder, Employee shall continue
         to receive other fringe benefits from the Company on no less favorable
         a basis than other employees of the Company of executive rank and
         status, except for benefits not legally available to Employee because
         of his status, compensation, age or similar factors, and subject to a
         maximum cost to the Company of $35,000 per year.

             (b) During Employee's employment hereunder, the Company shall
         provide Employee a computer for home use, linked to the Company's
         network and server.

         7. TREATMENT OF TAXABLE BENEFITS.

             (a) To the extent required by law, the Company will annually report
         as taxable wages and/or impute income to Employee the value of any
         taxable benefits, and all payments to the Employee shall be net of
         applicable withholdings as required by law.

             (b) To the extent that the reimbursement right provided in Section
         5(b) shall be subject to income taxation under the federal Internal
         Revenue Code of 1986 (the "Code") ("Additional Tax"), Employee shall be
         entitled to receive, and the Company shall pay to Employee, with the
         reimbursement payment, an additional payment ("Gross-Up Payment") in an
         amount equal to the Additional Tax (including federal income tax on
         such Additional Tax, computed at the highest marginal personal income
         tax rate). Employer shall also pay to Employee in 2008 a Gross-Up
         Payment (net if applicable withholdings) in an amount equal to the
         Additional Tax due by Employee on the transfer of the American General
         Policy. Determination of any Gross-Up Payment shall be made by Louis
         Plung & Co. or such other recognized accounting firm mutually accepted
         by the Company and Employee.

             (c) Reimbursement to Employee for premiums under Sections 4 or 5
         will be available only to the extent that: (i) such expense is actually
         incurred for any particular calendar year and reasonably substantiated;
         (ii) reimbursement shall be made no later than the end of the calendar
         year following the year in which such expense is incurred by Employee;
         and (iii) no reimbursement provided for any expense incurred in one
         taxable year will affect the amount available in another taxable year.
         The Employee is not entitled to liquidate or exchange for another
         benefit any right to reimbursements or in-kind benefits under this
         Agreement. However, in the event that any benefit provided for in
         Sections 4 or 5 of this Agreement ceases to be commercially available,
         the Company shall use its commercially reasonable best efforts to
         provide the Employee with a substitute in-kind benefit or health or
         life insurance product which preserves for the Employee the practical
         realization of the benefits contemplated in this Agreement.

                                       -3-
<PAGE>

         8. TERMINATION.

             (a) The Company may involuntarily terminate the employment of
         Employee for his dishonesty or willful misconduct adversely affecting
         its business affairs, based on majority vote of the Company's Board of
         Directors and reasonable written notice to Employee of that vote.

             (b) If for any reason Employee becomes totally and permanently
         disabled, physically or mentally, so as to be unable to perform all of
         his duties hereunder, and the Employee is reasonably unlikely to
         recover to the extent necessary to resume his usual duties within 60
         days, the Company by a majority vote of its Board of Directors may
         involuntarily terminate without cause the employment of Employee
         hereunder, effective a reasonable time after receiving written medical
         documentation of such total and permanent disability. The total and
         permanent disability of the Employee shall be substantiated by a
         written report of the Employee's regular physician or any other
         physician satisfactory to the Company and the Employee. The Employee
         agrees to make himself and his medical records available to such
         physician for the purposes of preparing such written report concerning
         his total and permanent disability.

             (c) If Employee dies during the Term, his employment hereunder
         shall terminate and the payment of compensation under Section 3 shall
         thereupon be discontinued; provided, however, the Company shall pay
         $108,000 to his designated payee, or if none, to the trustee of his
         revocable living trust, or if no trustee, to his estate. Any such
         payment shall be made within 60 days of the date of Employee's death.
         Notwithstanding such employment termination, the provisions of Section
         4 of this Agreement shall survive for the benefit of Employer's spouse,
         if living, and the Company shall continue to be bound by such
         provisions of this Agreement.

             (d) The Employee may terminate his employment with the Company at
         any time upon 60 days advance written notice to the Company for "Good
         Reason." Good reason shall exist if the Company materially reduces the
         Employee's compensation payable under Section 3 of this Employment
         Agreement, or materially reduces the benefits or life insurance payable
         under Sections 4 and 5 of this Employment Agreement. In order for
         Employee to terminate for Good Reason, (i) the Employer must be
         notified by Employee in writing within 90 days of the event
         constituting Good Reason, (ii) the event must remain uncorrected by
         Employer for 30 days following such notice (the "Notice Period"), and
         (iii) such termination must occur within 60 days after the expiration
         of the Notice Period.

         9. SEVERANCE. Subject to the provisions of Section 17, in the event
Employee's employment is involuntarily terminated without cause pursuant to
Section 8(b) or the Employee terminates his employment for Good Reason pursuant
to Section 8(d)of this Agreement, then the Company shall:

                                       -4-
<PAGE>

             (a) continue to pay to Employee the compensation under Section 3 of
         this Agreement for the remaining Term of this Agreement, in exchange
         for the Employee's agreement to be bound until December 31, 2014 by the
         confidentiality and non-compete provisions in Sections 10 and 11 of
         this Agreement; and

             (b) continue to provide the benefits set forth in Sections 4 and 5
         of this Agreement.

         10. CONFIDENTIAL INFORMATION, ETC.

             (a) Employee recognizes and acknowledges that: (i) in his
         employment hereunder he will acquire information, which could include
         in whole or in part information concerning the Company's sales, sales
         methods and proposals, customers and prospective customers, amount or
         kind of customers' purchases from the Company, the Company's sources of
         supply, computer programs, processes, methods, ideas, improvements,
         inventions or other confidential or proprietary information belonging
         to the Company or relating to the Company's affairs (collectively the
         "Confidential Information"); (ii) the Confidential Information is the
         property of the Company; (iii) the use, misappropriation or disclosure
         of the Confidential Information would constitute a breach of trust and
         could cause irreparable injury to the Company; and (iv) it is essential
         to the protection of the Company's good will and to the maintenance of
         the Company's competitive position that the Confidential Information be
         kept secret and that Employee not disclose the Confidential Information
         to others or use the Confidential Information to his own advantage or
         the advantage of others.

             (b) Employee further recognizes and acknowledges that it is
         essential for the proper protection of the business of the Company that
         he be restrained from (i) soliciting or inducing any employee of the
         Company to leave the employ of the Company, (ii) hiring or attempting
         to hire any employee of the Company, (iii) soliciting the trade of or
         trading with the customers and suppliers of the Company for any
         business purpose, and (iv) competing against the Company for a
         reasonable period.

         11. NON-COMPETE.

             (a) Employee agrees to hold and safeguard the Confidential
         Information in trust for the Company, its successors and assigns and
         agrees that he shall not, without the prior written consent of the
         Company, disclose or make available to anyone for use outside the
         Company at any time, either during his employment by the Company or
         subsequent to the termination of his employment by the Company for any
         reason, including without limitation termination by the Company in a
         Termination for Cause or otherwise, any of the Confidential
         Information, whether or not developed by Employee, except as required
         in the performance of Employee's duties to the Company.

             (b) Upon the termination of Employee's employment by the Company or
         by Employee for any reason, including without limitation termination by
         the Company in a Termination for Cause or otherwise, Employee shall
         promptly deliver to the Company all originals and copies of
         correspondence, financial and business records, reports, flow-charts,
         proposals and any documents concerning the Company's customers or
         concerning products or processes used by the Company and, without
         limiting the foregoing, shall promptly deliver to the Company any and
         all other documents or materials containing or constituting
         Confidential Information.

                                       -5-
<PAGE>

             (c) Employee agrees that during his employment by the Company he
         shall not, directly or indirectly, solicit the trade of, or trade with,
         any customer, prospective customer or supplier of the Company for any
         business purpose other than for the benefit of the Company. Employee
         further agrees that for a period of one year after termination of
         employment hereunder, Employee shall not, directly or indirectly,
         solicit the trade of, or trade with, any customers or suppliers, or
         prospective customers or suppliers, of the Company, or solicit or
         induce, or attempt to solicit or induce, any employee of the Company to
         leave the Company for any reason whatsoever or hire any employee of the
         Company.

             (d) Employee covenants and agrees that during the period of his
         employment hereunder and for a period of one year after termination of
         employment hereunder, Employee shall not within the United States
         engage, directly or indirectly, whether as principal or as agent,
         officer, director, employee, consultant, shareholder or otherwise,
         alone or in association with any other person, corporation or other
         entity, in any Competing Business. For purposes of this Agreement, the
         term "Competing Business" shall mean any person, corporation or other
         entity which sells or attempts to sell any products or services which
         are the same as or similar to the products and services sold by the
         Company at any time and from time to time during the last two years
         prior to the termination of Employee's employment hereunder.

         12. INJUNCTIVE AND OTHER RELIEF.

             (a) Employee represents that his experience and capabilities are
         such that the provisions of paragraphs 10 and 11 will not prevent him
         from earning his livelihood, and acknowledges that it would cause the
         Company serious and irreparable injury and cost if Employee were to use
         his ability and knowledge in competition with the Company or to
         otherwise breach the obligations contained in said paragraphs.

             (b) In the event of a breach by Employee of the terms of this
         Agreement, the Company shall be entitled, if it shall so elect, to
         institute legal proceedings to obtain damages for any such breach, or
         to enforce the specific performance of this Agreement by Employee and
         to enjoin Employee from any further violation of this Agreement and to
         exercise such remedies cumulatively or in conjunction with all other
         rights and remedies provided by law. Employee acknowledges, however,
         that the remedies at law for any breach by him of the provisions of
         this Agreement may be inadequate and that the Company shall be entitled
         to injunctive relief against him in the event of any breach whether or
         not the Company may also be entitled to recover damages hereunder.

             (c) It is the intention of the parties that the provisions of
         paragraphs 8 and 9 hereof shall be enforceable to the fullest extent
         permissible under applicable law, but that the unenforceability (or
         modification to conform to such law) of any provision or provisions
         hereof shall not render unenforceable, or impair, the remainder
         thereof. If any provision or provisions hereof shall be deemed invalid
         or unenforceable, either in whole or in part, this Agreement shall be
         deemed amended to delete or modify, as necessary, the offending
         provision or provisions and to alter the bounds thereof in order to
         render it valid and enforceable.

                                       -6-
<PAGE>

         13. ARBITRATION. Any dispute arising out of or relating to this
Agreement or the breach, termination or validity hereof shall be finally settled
by arbitration conducted expeditiously in accordance with the Employment Dispute
Rules of the American Arbitration Association by three independent and impartial
arbitrators. Each party shall appoint one of such arbitrators, and the two
arbitrators so appointed shall appoint the third arbitrator. The arbitration
shall be governed by the United States Arbitration Act, 9 U.S.C. ss.ss. 1-16,
and judgment on the award rendered by the arbitrators may be entered by any
court having jurisdiction thereof. The place of arbitration shall be Miami,
Florida. The arbitrators are not empowered to award damages in excess of
compensatory damages and each party hereby irrevocably waives any damages in
excess of compensatory damages.

         14. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Florida without giving effect to any
choice or conflict of law provision or rule (whether of the State of Florida or
any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Florida.

         15. AMENDMENTS, WAIVERS, ETC. No amendment of any provision of this
Agreement, and no postponement or waiver of any such provision or of any
default, misrepresentation, or breach of warranty or covenant hereunder, whether
intentional or not, shall be valid unless such amendment, postponement or waiver
is in writing and signed by or on behalf of the Company and Employee.
Notwithstanding the foregoing or any provision of this Agreement to the
contrary, Employer may at any time (with the consent of the Employee) modify,
amend or terminate any or all of the provisions of this Agreement or take any
other action, to the extent necessary or advisable, to conform the provisions of
this Agreement or the benefits provided thereunder with Section 409A of the
Code, the regulations issued thereunder or an exception thereto.

         16. ASSIGNMENT. The rights and duties of the Company under this
Agreement may be transferred to, and shall be binding upon, any person or
company which acquires the Company or its business by merger, purchase or
otherwise. Except as otherwise provided in this paragraph 16, neither the
Company nor Employee may transfer any of their respective rights and duties
hereunder except with the written consent of the other party hereto.

         17. SECTION 409A/TERMINATION OF EMPLOYMENT.

             (a) The provisions of this Agreement will be administered,
         interpreted and construed in a manner intended to comply with Section
         409A of the Code ("Section 409A"), the regulations issued thereunder or
         any exception thereto.

             (b) For purposes of this Agreement, Employee shall be considered to
         have experienced a termination of employment only if Employee has
         terminated employment with Employer and all of its controlled group
         members within the meaning of Section 409A of the Code. For purposes
         hereof, the determination of controlled group members shall be made
         pursuant to the provisions of Section 414(b) and 414(c) of the Code;
         provided that the language "at least 50 percent" shall be used instead
         of "at least 80 percent" in each place it appears in Section
         1563(a)(1),(2) and (3) of the Code and Treas. Reg.ss.1.414(c)-2.
         Whether Employee has terminated employment will be determined based on
         all of the facts and circumstances and in accordance with the guidance
         issued under Section 409A of the Code.

                                       -7-
<PAGE>

             (c) For purposes of Section 409A, each payment shall be treated as
         a separate payment. Each payment under this Agreement is intended to be
         excepted from Section 409A to the maximum extent provided under Section
         409A as follows: (i) each payment that is scheduled to be made
         following the Employee's termination date and within the applicable 2
         1/2month period specified in Treas. Reg.ss.1.409A-1(b)(4) is intended
         to be excepted under the short-term deferral exception as specified in
         Treas. Reg.ss.1.409A-1(b)(4); (ii) post-termination medical benefits
         are intended to be excepted under the medical benefits exception as
         specified in Treas. Reg.ss.1.409A-1(b)(9)(v)(B), and (iii) each payment
         that is not otherwise excepted under the short-term deferral exception
         or medical benefits exception is intended to be excepted under the
         involuntary pay exception as specified in Treas.
         Reg.ss.1.409A-1(b)(9)(iii). The Employee shall have no right to
         designate the date of any payment under this Agreement.

             (d) With respect to payments subject to Section 409A of the Code
         (and not excepted therefrom), if any, it is intended that each payment
         is paid on permissible distribution event and at a specified time
         consistent with Section 409A of the Code. Employer reserves the right
         to accelerate and/or defer any payment to the extent permitted and
         consistent with Section 409A. Notwithstanding any provision of this
         Agreement to the contrary, to the extent that a payment hereunder is
         subject to Section 409A of the Code (and not excepted therefrom) and
         payable on account of a termination of employment, such payment shall
         be delayed for a period of six months after the date of termination
         (or, if earlier, the death of Employee) if the Employee is a "specified
         employee" (as defined in Section 409A of the Code and determined in
         accordance with the procedures established by Employer). Any payment
         that would otherwise have been due or owing during such six-month
         period will be paid immediately following the end of the six-month
         period in the month following the month containing the six-month
         anniversary of the date of termination. Notwithstanding any provision
         of this Agreement to the contrary, to the extent the timing of any
         payment or benefit due under this Agreement was modified pursuant to
         the transition guidance provided by the IRS concerning the time and
         form of payment, any such modification shall only apply to amounts that
         would not otherwise be payable in 2008 and may not cause an amount to
         be paid in 2008 that would not otherwise be paid in 2008. To the extent
         any such payment cannot be made in 2008 under the transition guidance,
         such payment will be made in January 2009.

         18. INTERPRETATION, ETC. The Company and Employee have participated
jointly in negotiating and drafting of this Agreement. If an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the Company and Employee and no presumption or burden
of proof shall arise favoring or disfavoring the Company or Employee because of
the authorship of any of the provisions of this Agreement. The word "including"
shall mean including without limitation. The rights and remedies expressly
specified in this Agreement are cumulative and are not exclusive of any rights
or remedies which either party would otherwise have. The paragraph headings
hereof are for convenience only and shall not affect the meaning or
interpretation of this Agreement.

                                       -8-
<PAGE>

         19. INTEGRATION, COUNTERPARTS. This Agreement constitutes the entire
agreement between the parties and supersedes any prior understandings,
agreements or representations by or among the parties, written or oral, to the
extent they relate to the subject matter hereof. Employee and the Company
specifically revoke and rescind the Prior Agreement, and agree that it is of no
force and effect, and is superseded by this Agreement, insofar as it relates to
Employee's employment by the Company on and after January 1, 2008. This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original but all of which together shall constitute one and the same
instrument. It shall not be necessary in making proof of this Agreement to
produce or account for more than one such counterpart.

                          WITNESS the due execution hereof as of this 29th day
of December, 2008.

Attest:                                    DECORATOR INDUSTRIES, INC.

                                           By   /s/ Thomas L. Dusthimer
--------------------------------                --------------------------------
Corporate Seal                                  Thomas L. Dusthimer

                                           By  /s/ Joseph N. Ellis
                                               ---------------------------------
                                               Joseph N. Ellis

                                           By  /s/ Ellen Downey
                                               ---------------------------------
                                               Ellen Downey

Witness:                                   WILLIAM BASSETT

/s/ Darlene Bassett                           /s/  William Bassett
-------------------------------               ---------------------------------
                                              William Bassett

                                       -9-

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