Exhibit 10.12
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EMPLOYMENT AGREEMENT
(Xxxxxxx X. Xxxxxxx)
This EMPLOYMENT AGREEMENT between Sequiam Information Management Systems,
Inc. and Xxxxxxx X. Xxxxxxx (this "Agreement") is made effective as of the 28th
day of April, 2003 (the "Effective Date") by and between XXXXXXX X. XXXXXXX, an
individual ("Employee"), and SEQUIAM INFORMATION MANAGEMENT SYSTEMS, INC., a
Florida corporation (the "Corporation"), with reference to the following
recitals:
A. The Corporation was formed on April 28, 2003.
B. The Corporation has agreed to employ and Employee has agreed to act as
the Corporation's President and Chief Executive Officer.
C. The Corporation has agreed to issue 250,000 common shares of its
parent, Sequiam Corporation to Employee as an incentive to enter into
this contract.
NOW, THEREFORE, in consideration of the foregoing, the mutual
covenants and agreements set forth herein, the Merger Agreement, and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Employee and the Corporation hereby agree as follows:
1. Employment. The Corporation hereby employs Employee as the
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Corporation's Chief Executive Officer, and Employee hereby accepts such
employment by the Corporation, for the "Term" (as defined in Section 3 below),
upon the terms and conditions set forth herein.
2. Duties. During the Term, the Employee shall serve the
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Corporation faithfully, diligently and to the best of his ability, under the
direction of the Board of Directors of the Corporation. The Employee shall
render such services during the Term at the Corporation's principal place of
business, as the Corporation may from time to time reasonably require of him,
and shall devote all of his business time to the performance thereof. Employee
shall have those duties and powers as generally pertain to the office of
President, subject to the control of the Board of Directors. The precise
services and duties that the Employee is obligated to perform hereunder may from
time to time be changed, amended, extended or curtailed by the Board of
Directors of the Corporation.
3. Term. The "Term" of this Agreement shall commence on the
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Effective Date and continue thereafter for a term of two (2) years, as may be
extended or earlier terminated pursuant to the terms and conditions of this
Agreement. The Term of this Agreement shall automatically renew for successive
one (1) year periods unless, within sixty (60) days of the expiration of the
then existing Term, the Corporation or Employee provides written notice to the
other party that it elects not to renew the Term. Upon delivery of such notice,
this Agreement shall continue until expiration of the Term, whereupon this
Agreement shall terminate and neither party shall have any further obligation
thereafter arising under this Agreement, except as explicitly set forth herein
to the contrary.
4. Compensation.
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4.1 Salary. The Corporation shall pay to Employee an minimum
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annual salary of None ($000,000), payable in equal installments at the end of
such regular payroll accounting periods as are established by the Corporation,
or in such other installments upon which the parties hereto shall mutually
agree. In addition, the Corporation may adjust the salary from time to time,
and award bonuses in cash, stock or stock options or other property and
services.
Exhibit 10.12 - page 1
4.2 Benefits. During the Term, Employee shall be entitled to
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participate in all medical and other employee benefit plans, including vacation,
sick leave, retirement accounts, profit sharing, stock option plans, stock
appreciation rights, and other employee benefits, provided by the Corporation to
employees similarly situated.
4.3 Expense Reimbursement. The Corporation shall reimburse
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Employee for reasonable and necessary expenses incurred by him on behalf of the
Corporation in the performance of his duties hereunder during the Term, provided
that such expenses are adequately documented in accordance with the
Corporation's then customary policies.
5. Other Employment. Employee shall devote as much of his
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business and professional time and effort, attention, knowledge, and skill to
the management, supervision and direction of the Corporation's business and
affairs as is necessary to ensure the success of the Corporation as determined
solely by Employee. Employee may, during the term hereof, be interested directly
or indirectly, in any manner, as partner, officer, director, stockholder,
advisor, employee or in any other capacity in any other business; and nothing
herein contained shall prevent or limit the right of Employee to invest any of
his surplus funds in the capital stock or other securities of any corporation,
company or limited partnership, or whose stock or securities are publicly owned
or are regularly traded on any public exchange; nor shall anything herein
contained prevent Employee from investing or limit Employee's right to invest
his surplus funds in real estate; nor shall anything herein contained prevent
Employee from serving in a volunteer capacity as officer, director, or advisor
for professional organizations with which he is affiliated.
6. Indemnification.
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6.1 Third Party Actions. The Corporation hereby indemnifies
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Employee in the event that Employee is a party, or is threatened to be made a
party, to any proceeding (other than an proceeding by or in the right of the
Corporation to procure a judgment in the Corporation's favor) by reason of
Employee's status as an officer, director, agent or employee of the Corporation,
against expenses, judgments, fines, settlements, and other amounts actually and
reasonably incurred in connection with such proceeding if Employee acted in good
faith and in a manner that Employee reasonably believed to be in the
Corporation's best interests and, in the case of a criminal proceeding, Employee
had no reasonable cause to believe Employee's conduct was unlawful. The
termination of any proceeding by judgment, order, settlement, conviction, or
upon a plea of nolo contendere or its equivalent shall not, of itself, create
any presumption that (a) Employee did not act in good faith or in a manner which
Employee reasonably believed to be in the Corporation's best interests or (b)
Employee had no reasonable cause to believe that Employee's conduct was
unlawful.
6.2 Actions By the Corporation. The Corporation hereby
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indemnifies Employee in the event that Employee was or is a party, or is
threatened to be made a party, to any threatened, pending, or completed action
by or in the right of the Corporation to procure a judgment in the Corporation's
favor by reason of Employee's status as an officer, director, agent or employee
of the Corporation, against expenses actually and reasonably incurred by
Employee in connection with the defense or settlement of that action, if
Employee acted in good faith and in a manner Employee believed to be in the best
interests of the Corporation and the Corporation's shareholders. No
indemnification shall be made under this Section 6.2 with respect to any claim,
issue, or matter on which Employee has been adjudged to be liable to the
Corporation in the performance of Employee's duty to the Corporation and/ or the
Corporation's shareholders, unless and only to the extent that the court in
which such proceeding is or was pending shall determine on application that, in
view of all the circumstances of the case, Employee is fairly and reasonably
entitled to indemnity for expenses and then only to the extent that the court
shall determine.
Exhibit 10.12 - page 2
6.3 Successful Defense By Employee. To the extent that
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Employee has been successful on the merits in defense of any proceeding referred
to in Sections 6.1 or 6.2, or in defense of any claim, issue, or matter therein,
the Corporation shall indemnify Employee against expenses actually and
reasonably incurred by Employee in connection therewith.
6.4 Required Approval. Except for the indemnifications
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expressly authorized by Sections 6.1, 6.2 and 6.3, any indemnification of
Employee by the Corporation shall be made only if authorized in the specific
case, after a determination that indemnification of Employee is proper in the
circumstances by one of the following:
6.4.1 A majority vote of a quorum consisting of
directors who are not parties to such proceeding;
6.4.2 Independent legal counsel in a written opinion if
a quorum of directors who are not parties to such a proceeding is not available;
6.4.3 Either (a) the affirmative vote of a majority of
shares in the Corporation entitled to vote represented at a duly held meeting at
which a quorum is present; or (b) the written consent of holders of a majority
of the outstanding shares entitled to vote; provided however that for purposes
of this Section 6.4.3, the shares owned by Employee shall not be considered
outstanding or entitled to vote thereon); or
6.4.4 The court in which the proceeding is or was
pending, on application made by the Corporation, Employee or any attorney or
other person rendering services in connection with the defense, whether or not
such application is opposed by the Corporation.
6.5 Advances. Expenses incurred in defending any proceeding
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shall be advanced by the Corporation before the final disposition of such
proceeding upon receipt of an undertaking by or on behalf of Employee to repay
such amounts if it shall be determined ultimately that Employee is not entitled
to be indemnified as authorized in this Section 7.
6.6 Other Contractual Rights. The indemnification provided
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by this Section 6 shall be deemed cumulative, and not exclusive, of any other
rights to which Employee may be entitled under any bylaw, agreement, vote of
shareholders or disinterested directors, or otherwise, both as to action in an
official capacity and as to action in another capacity while holding such
office. Nothing in this section shall affect any right to indemnification to
which Employee may be entitled by contract or otherwise.
6.7 Limitations. No indemnification or advance shall be made
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under this Section 6, except as provided in Sections 6.4.3 or 6.4.4, in any
circumstance if it appears that it would be inconsistent with (a) an agreement
in effect at the time of the accrual of the alleged cause of action asserted in
the proceeding in which expenses were incurred or other amounts were paid, which
prohibits or otherwise limits indemnification; or (b) any condition expressly
imposed by a court in approving settlement.
6.8 Insurance. To the extent available at commercially
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reasonable rates and limits, the Corporation shall purchase and maintain
insurance on behalf of Employee insuring against any liability asserted against
or incurred by Employee in that capacity or arising out of Employee's status as
such, whether or not the Corporation has the power to indemnify Employee against
that liability under the provisions of this Section 6.
Exhibit 10.12 - page 3
6.9 Survival. The rights provided by this Section 6 shall
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survive the expiration or earlier termination of this Agreement pursuant hereto
and shall inure to the benefit of Employee' heirs, executors, and
administrators.
6.10 Amendment. Any amendment, repeal, or modification of
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the Corporation's articles or bylaws shall not adversely affect Employee's right
or protection existing at the time of such amendment, repeal, or modification.
6.11 Settlements. The Corporation shall not be liable to
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indemnify Employee under this Section 6 for (i) any amounts paid in settlement
of any action or claim effected without the Corporation's written consent, which
consent shall not be unreasonably withheld, or (ii) any judicial award, if the
Corporation was not given a reasonable and timely opportunity to participate, at
the Corporation's expense, in the defense of such action.
6.12 Subrogation. In the event of payment under this Section
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6, the Corporation shall be subrogated to the extent of such payment to all
Employee's rights of recovery; and Employee shall execute all papers required
and shall do everything necessary or appropriate to secure such rights,
including the execution of any documents necessary or appropriate to the
Corporation effectively bringing suit to enforce such rights.
6.13 No Duplication Of Payments. The Corporation shall not
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be liable under this Section 6 to make any payment in connection with any claim
made against Employee to the extent Employee has otherwise actually received
payment, whether under a policy of insurance, agreement, vote, or otherwise, of
any amount which is otherwise subject to indemnification under this Section 6.
6.14 Proceedings And Expenses. For the purposes of this
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Section 6, "proceeding" means any threatened, pending, or completed action or
proceeding, whether civil, criminal, administrative, or investigative; and
"expenses" includes, without limitation, attorney fees and any expenses of
establishing a right to indemnification under this Section 6.
7. Confidential Information/ Inventions.
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7.1 Employee shall not, in any manner, for any reasons,
either directly or indirectly, divulge or communicate to any person, firm or
corporation, any confidential information concerning any matters not generally
known in the document management software industry or otherwise made public by
the Corporation which affects or relates to the Corporation's business,
finances, marketing and/ or operations, research, development, inventions,
products, designs, plans, procedures, or other data (collectively, "Confidential
Information") except in the ordinary course of business or as required by
applicable law. Without regard to whether any item of Confidential Information
is deemed or considered confidential, material, or important, the parties hereto
stipulate that as between them, to the extent such item is not generally known
in the property casualty insurance industries, such item is important, material,
and confidential and affects the successful conduct of the Corporation's
business and good will, and that any breach of the terms of this Section 7.1
shall be a material and incurable breach of this Agreement.
7.2 Employee further agrees that all documents and materials
furnished to Employee by the Corporation and relating to the Corporation's
business or prospective business are and shall remain the exclusive property of
the Corporation as the case may be. Employee shall deliver all such documents
and materials to the Corporation upon demand therefor and in any event upon
expiration or earlier termination of this Agreement. Any payment of sums due
and owing to Employee by the Corporation upon such expiration or earlier
termination shall be conditioned upon returning all
Exhibit 10.12 - page 4
such documents and materials, and Employee expressly authorizes the Corporation
to withhold any payments due and owing pending return of such documents and
materials.
7.3 All ideas, inventions, and other developments or
improvements conceived or reduced to practice by Employee, alone or with others,
during the term of this Agreement, whether or not during working hours, that are
within the scope of the business of the Corporation or that relate to or result
from any of the Corporation's work or projects or the services provided by
Employee to the Corporation pursuant to this Agreement, shall be the exclusive
property of the Corporation. Employee agrees to assist the Corporation during
the term, at the Corporation's expense, to obtain patents and copyrights on any
such ideas, inventions, writings, and other developments, and agrees to execute
all documents necessary to obtain such patents and copyrights in the name of the
Corporation.
8. Covenant Not to Compete. Except as expressly permitted in
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Section 5 above, during the term of this Agreement, Employee shall not engage in
any of the following competitive activities: (a) engaging directly or indirectly
in any business or activity substantially similar to any business or activity
engaged in (or proposed to be engaged in) by the Corporation; (b) engaging
directly or indirectly in any business or activity competitive with any business
or activity engaged in (or proposed to be engaged in) by the Corporation; (c)
soliciting or taking away any employee, agent, representative, contractor,
supplier, vendor, customer, franchisee, lender or investor of the Corporation,
or attempting to so solicit or take away; (d) interfering with any contractual
or other relationship between the Corporation and any employee, agent,
representative, contractor, supplier, vendor, customer, franchisee, lender or
investor; or (e) using, for the benefit of any person or entity other than the
Corporation, any Confidential Information of the Corporation. The foregoing
covenant prohibiting competitive activities shall survive the termination of
this Agreement and shall extend, and shall remain enforceable against Employee,
for the period of one (1) year following the date this Agreement is terminated.
In addition, during the two-year period following such expiration or earlier
termination, Employee shall not make or permit the making of any negative
statement of any kind concerning the Corporation.
9. Survival. Employee agrees that the provisions of Sections 7
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and 8 shall survive expiration or earlier termination of this Agreement for any
reasons, whether voluntary or involuntary, with or without cause, and shall
remain in full force and effect thereafter.
10. Injunctive Relief. Employee acknowledges and agrees that the
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covenants and obligations of Employee set forth in Sections 7 and 8 with respect
to non-competition, non-solicitation, confidentiality and the Corporation's
property relate to special, unique and extraordinary matters and that a
violation of any of the terms of such covenants and obligations will cause the
Corporation irreparable injury for which adequate remedies are not available at
law. Therefore, Employee agrees that the Corporation shall be entitled to an
injunction, restraining order or such other equitable relief (without the
requirement to post bond) as a court of competent jurisdiction may deem
necessary or appropriate to restrain Employee from committing any violation of
the covenants and obligations referred to in this Section 10. These injunctive
remedies are cumulative and in addition to any other rights and remedies the
Corporation may have at law or in equity.
11. Termination
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11.1 Termination by Employee. Employee may terminate this
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Agreement without cause at any time and for any reason upon thirty (30) days
notice to the Corporation. Employee may immediately terminate this Agreement
for cause at any time by written notice to the Corporation. For purposes of
this Agreement, the term "cause" for termination by Employee shall be (a) a
material breach by the Corporation of any material covenant or obligation
hereunder; or (b) the voluntary or involuntary dissolution of the Corporation.
The written notice given hereunder by Employee to the Corporation shall specify
in reasonable detail the cause for termination, and, in the case
Exhibit 10.12 - page 5
of the cause described in (a) above, such termination notice shall not be
effective until thirty (30) days after the Corporation's receipt of such notice,
during which time the Corporation shall have the right to respond to Employee's
notice and cure the breach or other event giving rise to the termination.
11.2 Termination by the Corporation. The Corporation may
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terminate its employment of Employee under this Agreement without cause at any
time and for any reason upon thirty (30) days notice to Employee. The
Corporation may terminate its employment of Employee under this Agreement for
cause at any time by written notice to Employee. For purposes of this
Agreement, the term "cause" for termination by the Corporation shall be (a) a
conviction of or plea of guilty or nolo contendere by Employee to a felony; (b)
the consistent refusal by Employee to perform his material duties and
obligations hereunder; or (c) Employee's willful and intentional misconduct in
the performance of his material duties and obligations. The written notice
given hereunder by the Corporation to Employee shall specify in reasonable
detail the cause for termination. In the case of a termination for the cause
described in (a) above, such termination shall be effective upon receipt of the
written notice. In the case of the causes described in (b) and (c) above, such
termination notice shall not be effective until thirty (30) days after
Employee's receipt of such notice, during which time Employee shall have the
right to respond to the Corporation's notice and cure the breach or other event
giving rise to the termination.
11.3 Severance. Upon a termination of this Agreement without
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cause by Employee or with cause by the Corporation, the Corporation shall
immediately pay to Employee all accrued and unpaid compensation as of the date
of such termination. Upon a termination of this Agreement with cause by
Employee or without cause by the Corporation, the Corporation shall immediately
pay to Employee all accrued and unpaid compensation as of the date of such
termination and the "Severance Payment." The "Severance Payment" shall equal
the total amount of salary payable to Employee under Section 4.1 of this
Agreement from the date of such termination until the end of the term of this
Agreement (prorated for any partial month), but in no event less than one year's
salary payable under Section 4.1 hereof. The accrued compensation due and
payable at termination together with any Severance Payment due hereunder shall
bear interest at the lesser of eight percent (8%) per annum or the maximum rate
permitted by law until such amounts are paid in full.
12. Termination Upon Death. If Employee dies during the term of
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this Agreement, this Agreement shall terminate, except that Employee's legal
representatives shall be entitled to receive any earned but unpaid compensation
due hereunder.
13. Termination Upon Disability. If, during the term of this
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Agreement, Employee suffers and continues to suffer from a "Disability" (as
defined below), then the Corporation may terminate this Agreement by delivering
to Employee sixty (60) calendar days prior written notice of termination based
on such Disability, setting forth with specificity the nature of such Disability
and the determination of Disability by the Corporation. For the purposes of
this Agreement, "Disability" means Employee's inability, with reasonable
accommodation, to substantially perform Employee's duties, services and
obligations under this Agreement due to physical or mental illness or other
disability for a continuous, uninterrupted period of ninety (90) calendar days.
14. Personnel Policies, Conditions, And Benefits. Except as
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otherwise provided herein, Employee's employment shall be subject to the
personnel policies and benefit plans which apply generally to the Corporation's
employees as the same may be interpreted, adopted, revised or deleted from time
to time, during the term of this Agreement, by the Corporation in its sole
discretion. During the term hereof, Employee shall receive the following:
14.1 Term Life Insurance. In addition to Employee's
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participation in any life insurance plan or plans available to all employees of
the Corporation, the Corporation shall provide Employee with term life insurance
in the amount of One Million Dollars ($1,000,000.00) if available at
Exhibit 10.12 - page 6
standard rates or, in the alternative, term life insurance in such lesser amount
as the standard, unrated premium for coverage of $1,000,000.00 will purchase.
14.2 Vacation. Employee shall be entitled to vacation during
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each year of the term at the rate of four (4) weeks per year; provided that no
vacation shall accrue from year to year during the term.
15. Beneficiaries of Agreement. This Agreement shall inure to the
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benefit of the Corporation and any affiliates, successors, assigns, parent
corporations, subsidiaries, and/or purchasers of the Corporation as they now or
shall exist while this Agreement is in effect.
16. No Waiver. No failure by either party to declare a default
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based on any breach by the other party of any obligation under this Agreement,
or failure of such party to act quickly with regard thereto, shall be considered
to be a waiver of any such obligation, or of any future breach.
17. Modification. No waiver or modification of this Agreement or
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of any covenant, condition, or limitation herein contained shall be valid unless
in writing and duly executed by the parties to be charged therewith.
18. Choice Of Law/Jurisdiction. This Agreement shall be governed
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by and construed in accordance with the laws of the State of Florida, without
regard to any conflict-of-laws principles. The Company and Employee hereby
consent to personal jurisdiction before all courts in the County of Orange,
State of Florida, and hereby acknowledge and agree that Orange County, Florida
is and shall be the most proper forum to bring a complaint before a court of
law.
19. Entire Agreement. This Agreement embodies the whole agreement
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between the parties hereto and there are no inducements, promises, terms,
conditions, or obligations made or entered into by the Corporation or Employee
other than contained herein.
20. Severability. All agreements and covenants contained herein
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are severable, and in the event any of them, with the exception of those
contained in Sections 1 and 4 hereof, shall be held to be invalid by any
competent court, this Agreement shall be interpreted as if such invalid
agreements or covenants were not contained herein.
21. Headings. The headings contained herein are for the
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convenience of reference and are not to be used in interpreting this Agreement.
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto as of the date first above written.
the "CORPORATION"
SEQUIAM INFORMATION MANAGEMENT SYSTEMS, INC., a Florida corporation
By:
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Nicolaas Van den Brekel, Chairman
By:
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Xxxx X. Xxxxxxxxxxx, Secretary and CFO
Exhibit 10.12 - page 7
1.2 "Employee"
/s/ Xxxxxxx X. Xxxxxxx
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XXXXXXX X. XXXXXXX, an individual
Exhibit 10.12 - page 8
