EXHIBIT 10.9
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (THIS "AGREEMENT") IS MADE AND ENTERED INTO
AS OF JANUARY 1, 1998 BY AND BETWEEN AMERICAN TECHNOLOGIES GROUP, INC., A NEVADA
CORPORATION ("EMPLOYER"), AND [NAME] ("EMPLOYEE"), AND IS MADE WITH RESPECT
TO THE FOLLOWING FACTS:
RECITALS
A. WHEREAS, Employer desires to continue the services of Employee as
[TITLE] (together, "[TITLE]"); and
B. WHEREAS, Employee is willing to provide such services to Employer.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, and other good and valuable consideration the receipt of which
is hereby acknowledged, THE PARTIES HEREBY AGREE AS FOLLOWS:
1. EMPLOYMENT.
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1.1 TITLE, BOARD MEMBERSHIPS. Employer hereby engages Employee and
Employee hereby accepts employment with Employer, to perform Employee's services
as [TITLE] of Employer and such other services as may be required of Employee
under this Agreement, on the terms and conditions hereinafter set forth.
Employee further agrees to accept election and to serve during all or any part
of the Term (as that term is defined in Section 2 hereof) of this Agreement as
an officer and/or director of Employer and of any subsidiary or affiliate of
Employer, without compensation therefor, except as set forth in this Agreement,
if elected to any such position by the shareholders of Employer or by the Board
of Directors of Employer (the "Board") or of any subsidiary or affiliate, as the
case may be.
1.2 DUTIES, PLACE OF EMPLOYMENT. Employee shall perform all duties
customarily performed by Employees employed in the capacity of [TITLE] of
companies engaged in the business of Employer and shall use and devote his full
time and efforts in the discharge of his duties. Employee shall perform his
duties at Employer's principal Employee offices in Los Angeles County, but shall
travel to and from such county as may be reasonably required in the performance
of such duties. Subject to the terms of this Agreement, Employee shall comply
promptly and faithfully with Employer's reasonable instructions, directions,
requests, rules and regulations. Employer shall not be deemed to have waived
the right to require Employee to perform any duties hereunder by assigning
Employee to any other duties or services.
2. TERM. The term ("Term") of this Agreement shall commence as of the
date hereof and shall continue until December 31, 1998 and thereafter shall
automatically renew for consecutive one year terms unless (i) terminated by
written
notice given by either party to the other at least sixty (60) days prior
to the end of the initial term or any subsequent one year term or (ii)
terminated sooner pursuant to Section 5 of this Agreement. If the Term is
extended pursuant to this Section 2, during such period of extension Employer
shall pay Employee all compensation to which Employee is entitled under this
Agreement.
3. COMPENSATION. During the Term as full compensation for all services
to be performed by Employee pursuant to this Agreement, Employer agrees to pay
Employee the base salary and bonuses set forth in this Section 3, in addition to
such other benefits and compensation as are provided elsewhere in this
Agreement.
3.1 BASE SALARY. Employee shall be entitled to an annual base salary
of $_______. The base salary shall be paid to Employee bi-weekly during the
Term.
3.2 COMMITMENT PAYMENTS. As further consideration for the commitment
and obligations of Employee hereunder, Employer shall issue to Employee an
option (the "Option") to purchase ____________ shares of Common Stock (the
"Shares") at an exercise price of $____ per share (the Option and the Shares are
hereinafter referred to collectively as the "Securities"). The Option shall
expire on December 31, 2006 and vest 25% immediately and 25% on each of January
1, 1999, 2000 and 2001, provided the Agreement is in effect on such vesting
date. Notwithstanding the foregoing, to the extent not previously exercisable,
the Option shall become exercisable in its entirety in the event that (i) there
occurs a Change in Control of Employer (as hereafter defined) (ii) Employer
concludes the sale of substantially all of its assets other than in a
transaction which is intended primarily to effect a corporate reorganization
without material change in beneficial ownership of the material business of
Employer or (iii) Employee is terminated by Employer other than for Cause (as
hereafter defined). The option agreement shall be in the form of Exhibit A,
attached hereto. Employee understands that the Option and the shares of Common
Stock underlying the Option have not been registered under federal or state
securities laws and may not be transferred without registration thereunder or
pursuant to an exemption therefrom.
3.3 BONUS. Nothing herein contained shall preclude the Board of
Directors of Employer from authorizing the payment to Employee of a bonus,
whether in cash or capital stock, based upon Employee's performance or other
reasonable criteria. The payment of such additional compensation shall not
operate as an amendment obligating Employer to make any similar payment or to
pay additional compensation at any future time or for any future period or be
deemed to affect the base salary in any manner.
3.4 ADDITIONAL BENEFITS.
(a) MEDICAL INSURANCE. Employer shall provide Employee during
the Term with group accident, medical, dental and hospital insurance coverage,
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provided however, that such insurance shall only be provided when determined by
the Board of Directors to be within the financial resources of the Company.
(b) BENEFITS GENERALLY OFFERED. In addition to any other
compensation or benefits to be received by Employee pursuant to the terms of
this Agreement, Employee shall be entitled to participate, to the extent
allowable in accordance with his status, in all employee benefits offered from
time to time by Employer to its senior officers; including, but not limited to,
stock option plans, group life, disability and any other insurance and profit
sharing plans.
4. VACATION. Employee shall be entitled to two (2) weeks paid vacation
for each year worked during the Term.
5. TERMINATION.
5.1 TERMINATION FOR CAUSE. Employee's employment under the terms of
this Agreement may be terminated immediately, at the option of Employer, for
"Cause" as that term is defined in Section 6.2(a).
5.2 TERMINATION FOR DISABILITY. Employee's employment under the
terms of this Agreement may be terminated immediately, at the option of
Employer, for "Disability" as that term is defined in Section 6.2(b).
5.3 TERMINATION BY DEATH. Employee's employment under the terms of
this Agreement shall be terminated upon the death of Employee.
6. PAYMENTS UPON TERMINATION OF EMPLOYMENT.
6.1 PAYMENTS. In the event of the termination of Employee's
employment under this Agreement by Employer, other than termination for "Cause,"
or if Employee voluntarily terminates his employment within 90 days prior to or
180 days after a Change of Control (the "Change of Control Period"), Employee
shall have no duty to mitigate and Employer shall upon such termination pay to
Employee (i) three months base salary and (ii) continue payment of health
benefits for a period of three months (together, the "Severance Benefits"),
provided, however, if Employer terminates Employee's employment during the
Change of Control Period, then Employer shall pay Employee Severance Benefits
for a period of one year.
6.2 DEFINITIONS.
(a) CAUSE. Termination by the Board of Employee's employment
for "Cause" shall mean a termination upon (i) the good faith determination of
the Board that Employee has failed to perform fully or faithfully Employee's
obligation under this Agreement, (ii) the final conviction of Employee of any
felony, or a misdemeanor involving theft, fraud, dishonesty, misrepresentation
or willful conduct materially
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injurious, harmful or detrimental to Employer; (iii) Employee commits an act or
omits to take action in bad faith or to the detriment of Employer, (iv) Employee
fails or refuses to comply with the policies, standards or regulations of
Employer or (v) Employee violates any of the warranties contained in Section 9
hereof. For the purposes of this Section 6.2(a), "final conviction" and shall
be and mean a conviction or an adjudication, as the case may be, that is no
longer appealable due to the passage of time or otherwise, and with respect to
which a final judgment has been entered on the judgment roles of the court in
which the action was commenced. Further, for the purposes of this Section
6.2(a), no act or omission to act on Employee's part shall be considered
"Willful" unless done, or omitted to be done, by Employee in bad faith and
without reasonable belief that Employee's act or omission was in the best
interest of Employer.
(b) DISABILITY. Termination of Employee's employment for
"Disability" shall mean a termination following absence from Employee's
full-time duties with Employer for one hundred eighty (180) consecutive days
as a result of Employee's incapacity due to physical or mental illness and
Employee's failure to return to the full-time performance of Employee's duties
within thirty (30) days after written notice of termination is given to
Employee.
(c) CHANGE IN CONTROL. The term "Change in Control" means an
event or series of events that would be required to be described as a change in
control of Employer in a proxy or information statement distributed by Employer
pursuant to Section 14 of the Securities Exchange Act of 1934 in response to
Item 6(e) of Schedule 14A promulgated thereunder, or any substitute provision
which may hereafter be promulgated thereunder or otherwise adopted.
7. TRADE SECRETS. The parties acknowledge and agree that during the Term
and in the course of the discharge of his duties hereunder, Employee shall have
access to and become acquainted with information concerning the operations of
Employer, including, without limitation, financial, sales, customer, supplier,
operations, personnel and other information that is owned by Employer and
regularly used in the operation of Employer's business and that this information
constitutes Employer's trade secrets. Employee agrees that he shall not
disclose any such trade secrets, directly or indirectly, to any other person or
use any of them in any way either during the Term or at any time thereafter,
except as required in the course of his employment hereunder.
8. NON-COMPETITION. During the term hereof, and for three years
thereafter, Employee shall not, directly or indirectly, whether as an employee,
employer, consultant, agent, officer, principal, partner, stockholder, director
or any other individual or representative capacity, engage or participate in any
business that is in competition in any manner with the business of Employer.
9. EMPLOYEE'S REPRESENTATIONS AND WARRANTIES. Employee hereby warrants
and represents to Employer and Employer as follows, each of which representation
and warranty is material and is being relied upon by Employer and
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Employer and each of which is true at and as of the date hereof and as of the
issuance of the Shares and each such issuance:
9.1 INVESTMENT INTENT. Employee is acquiring the Option for his own
account and not with a view to its resale or distribution and that he is
prepared to hold the Option for an indefinite period and has no present
intention to sell, distribute or grant any participating interests in the
Securities. Employee hereby acknowledges the fact that the Securities will not
be registered under the Securities Act of 1933, as amended (the "1933 Act") or
applicable state securities laws.
9.2 RESTRICTED SECURITIES. that Employee has been informed that the
Securities may not be resold or transferred unless first registered under
applicable Federal and State securities laws or unless an exemption from such
registration is available. Accordingly, Employee hereby acknowledges that he is
prepared to hold the Securities for an indefinite period of time.
9.3 EMPLOYEE'S KNOWLEDGE. that Employee has a preexisting business
or personal relationship with Employer, that he is aware of the business affairs
and financial condition of Employer and that he has such knowledge and
experience in business and financial matters with respect to companies in
business similar to Employer to enable Employee to evaluate the risks of the
prospective investment and to make an informed investment decision with respect
thereto. Employee further acknowledges that Employer has made available to
Employee the opportunity to ask questions and receive answers from Employer
concerning the terms and conditions of the issuance of the Securities and that
Employee could be reasonably assumed to have the capacity to protect his own
interests in connection with such investment.
9.4 SPECULATIVE INVESTMENT. that Employee realizes that his purchase
of the Securities will be a speculative investment and that Employee is able,
without impairing his financial condition, to hold the Securities for an
indefinite period of time and to suffer a complete loss of his investment.
9.5 NO INCONSISTENT OBLIGATIONS. Employee is under no contractual or
other restriction or obligation, compliance with which is inconsistent with the
execution of this Agreement, the performance of Employee's obligations hereunder
or the other rights of Employer hereunder; and
9.6 NO INFIRMITY. Employee is under no physical or mental disability
that would hinder the performance of Employee's obligations under this
Agreement.
10. PERSONAL NATURE. This Agreement is personal, being entered into upon
the singular skill, qualifications and experience of Employee. Employee shall
not assign this Agreement or any rights, benefits, duties or obligations
hereunder without the express written consent of Employer. Employee hereby
grants to Employer the right to use Employee's name, likeness and/or biography
in connection with the
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services performed by Employee hereunder and in connection with the advertising
or exploitation of any project with respect to which Employee performs services
hereunder.
11. NOTICES. Any and all notices or other communications required or
permitted by this Agreement or by law shall be deemed duly served and given when
actually received by personal delivery or by certified mail, return receipt
requested, with first class postage prepaid thereon, to the party to whom such
notice or communication is directed, addressed as follows:
EMPLOYER: AMERICAN TECHNOLOGIES GROUP, INC.
0000 X. Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
EMPLOYEE: NAME
0000 X. Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Each of the parties hereto may change its address for purposes of this
Section 11 by giving written notice of such change in the manner provided for in
this Section 11.
12. GOOD FAITH. All approvals and consents required to be given by any
party to this Agreement shall be given or withheld in good faith and may not be
unreasonably withheld. Each party hereto shall use due diligence in its attempt
to accomplish any act required to be accomplished by that party.
13. ATTORNEY'S FEES AND EXPENSES. In the event that it should become
necessary for any party to this Agreement to bring an action, including
arbitration, either at law or in equity, to enforce or interpret the terms of
this Agreement, the prevailing party in such action shall be entitled to recover
its reasonable attorneys' fees and expenses as a part of any judgment therein,
in addition to any other award which may be granted.
14. APPLICABLE LAW/VENUE. This Agreement is executed and intended to be
performed in the State of California and the laws of such state shall govern its
interpretation and effect. If suit is instituted by any party hereto by any
other party hereto for any cause or matter arising from or in connection with
the respective rights or obligations of the parties hereunder, the sole
jurisdiction and venue for such action shall be the Superior Court of the State
of California in and for the County of Los Angeles.
15. INTEGRATED AGREEMENT. This Agreement constitutes the entire agreement
of the parties with respect to the subject matter of this Agreement and
supersedes all prior employment agreements between the parties and all such
prior
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employment agreements shall be deemed voluntarily terminated by the mutual
consent of the parties hereto and shall be of no further force or effect.
16. SEVERABILITY. Any provision in this Agreement which is, by competent
judicial authority, declared illegal, invalid or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such illegality, invalidity or unenforceability without invalidating the
remaining provisions hereof or affecting the legality, validity or
enforceability of such provision in any other jurisdiction. The parties hereto
agree to negotiate in good faith to replace any illegal, invalid or
unenforceable provision of this Agreement with a legal, valid and enforceable
provision that, to the extent possible, will preserve the economic bargain of
this Agreement, or otherwise to amend this Agreement, including the provision
relating to choice of law, to achieve such result.
16. WAIVER No waiver of any of the provisions of this Agreement shall be
deemed, or shall constitute, a waiver of any other provision, whether or not
similar, nor shall any waiver constitute a continuing waiver. No waiver shall
be binding unless executed in writing by the party making the waiver.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
EMPLOYEE: __________________________________
[NAME]
EMPLOYER: American Technologies Group, Inc.,
a Nevada corporation
By: ______________________________
Title:
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