EMPLOYMENT AGREEMENT
This Employment Agreement is made and entered into as of April 1, 1997,
by and between XxXxxxx Metals Golf Corp, a Nevada corporation and XxXxxxx
Metals, Inc., an Illinois corporation, herein collectively referred to as
"XxXxxxx" and Xxxxxx X. Xxxxxxx, herein referred to as "Xxxxxxx".
ARTICLE 1. TERM OF EMPLOYMENT
Section 1.01 XxXxxxx hereby employs Xxxxxxx and Xxxxxxx hereby
accepts employment with XxXxxxx for a period of one year beginning on April
15, 1997 and terminating on April 1, 1998.
Section 1.02 This agreement shall be renewed automatically for
succeeding terms of one year unless either party gives notice to the other at
least sixty (60) days prior to the expiration of any term of his or its
intention not to renew.
Section 1.03 As used herein, the phrase "employment term" refers to
the entire period of employment of Xxxxxxx by XxXxxxx hereunder, whether for
the periods provided above, or whether terminated earlier as hereinafter
provided or extended by mutual agreement between the parties.
ARTICLE 2. DUTIES AND OBLIGATIONS OF EMPLOYEE
Section 2.01 Xxxxxxx shall serve as Comptroller and Chief Financial
Officer. In his capacity as Comptroller and Chief Financial Officer of
XxXxxxx, Xxxxxxx shall do and perform all services, acts, or things necessary
or advisable to fulfill the duties of a corporate comptroller, including
carefully and accurately causing to be prepared books of accounts, balance
sheets, and operating statements, and examination and reporting of
expenditures of XxXxxxx, subject at all times to the policies set by XxXxxxx'x
Board of Directors, and to the consent of the Board or the Executive Committee
of the Board when required by the terms of this contract.
Section 2.02 (a) Xxxxxxx shall devote his entire productive time,
ability, and attention to the business of XxXxxxx during the term of this
contract.
(b) Xxxxxxx shall not engage in any other business
duties or pursuits whatsoever, or directly or indirectly render any services
of a business, commercial, or professional nature to any other person or
organization, whether for compensation or otherwise, without the prior written
consent of XxXxxxx'x Board of Directors or Executive Committee. However, the
expenditure of reasonable amounts of time for educational, charitable, or
professional activities shall not be deemed a breach of this agreement if
those activities do not materially interfere with the services required under
this agreement and
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shall not require the prior written consent of Employer's Board of Directors
or Executive Committee.
(c) This agreement shall not be interpreted to
prohibit Xxxxxxx from making passive personal investments or conducting
private business affairs if those activities do not materially interfere with
the services required under this agreement. However, Xxxxxxx shall not
directly or indirectly acquire, hold, or retain any interest in any business
competing with or similar in nature to the business of XxXxxxx.
Section 2.03 During the term of this contract, Xxxxxxx shall not,
directly or indirectly, either as an employee, employer, consultant, agent,
principal, partner, stockholder, corporate officers, director, or in any other
individual or representative capacity, engage or participate in any business
that is in competition in any manner whatsoever with the business of XxXxxxx.
Section 2.04 Xxxxxxx hereby represents and agrees that the services
to be performed under the terms of this contract are of a special, unique,
unusual, extraordinary, and intellectual character that gives them a peculiar
value the loss of which cannot be reasonably or adequately compensated in
damages in an action at law. Xxxxxxx therefore expressly agrees that XxXxxxx,
in addition to any other rights or remedies that XxXxxxx may possess, shall be
entitled to injunctive and other equitable relief to prevent or remedy a
breach of this contract by Xxxxxxx.
Section 2.05 (a) The parties acknowledge and agree that during
the term of this agreement and in the course of the discharge of his duties
hereunder, Xxxxxxx shall have access to and become acquainted with information
concerning the operation and processes of XxXxxxx including without
limitation, financial, personnel, sales, scientific, and other information
that is owned by XxXxxxx and regularly used in the operation of XxXxxxx'x
business, and that such information constitutes XxXxxxx'x trade secrets.
(b) Xxxxxxx specifically agrees that he shall not
misuse, misappropriate, or disclose any such trade secrets, directly or
indirectly, to any other person or use them in any way, either during the term
of this agreement or at any other time thereafter, except as is required in
the course of his employment hereunder.
(c) Xxxxxxx acknowledges and agrees that the sale or
unauthorized use or disclosure of any of XxXxxxx'x trade secrets obtained by
Xxxxxxx during the course of his employment under this agreement, including
information concerning XxXxxxx'x current or any future and proposed work,
services, or products, the facts that any such work, services, or products are
planned, under consideration, or in production, as well as any descriptions
thereof, constitute unfair competition. Employee promises and agrees not to
engage in any unfair competition with XxXxxxx, either during the term of this
agreement or at any other time thereafter.
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(d) Xxxxxxx further agrees that all files, records,
documents, drawings, specifications, equipment, and similar items relating to
XxXxxxx'x business, whether prepared by Xxxxxxx or others, are and shall
remain exclusively the property of XxXxxxx and that they shall not be removed
from the premises of XxXxxxx.
ARTICLE 3. OBLIGATIONS OF EMPLOYER
Section 3.01 XxXxxxx shall provide Xxxxxxx with the compensation,
incentives, benefits, and business expense reimbursement specified herein.
Section 3.02 XxXxxxx shall provide Xxxxxxx with a private office,
stenographic help, office equipment, supplies, and other facilities and
services, suitable to Xxxxxxx'x position and adequate for the performance of
his duties.
Section 3.03 XxXxxxx shall indemnify Xxxxxxx for all losses sustained
by Xxxxxxx in direct consequence of the discharge of his duties on XxXxxxx'x
behalf.
ARTICLE 4. COMPENSATION OF EMPLOYEE
Section 4.01 (a) As compensation for the services to be performed
hereunder, Xxxxxxx shall receive a salary at the rate of $52,000 per annum,
payable not less than once
each month, on or before the 30th day of each month.
(b) Xxxxxxx shall receive such annual increases in
salary as may be determined by XxXxxxx'x Board of Directors or Executive
Committee.
ARTICLE 5. STOCK BONUS
Section 5.01 As additional compensation, XxXxxxx will issue to
Xxxxxxx, as of the effective date of this Agreement, Fifty Thousand (50,000)
shares of the common stock of XxXxxxx.
Section 5.02 All shares issued to Xxxxxxx pursuant to this provision
shall be subject to restriction, in addition to those imposed by Rule 144 of
the Rules of the Securities and Exchange Commission, that XxXxxxx shall have
the right and option, but not the obligation, to repurchase such shares should
Xxxxxxx resign or terminate his employment, except by his death, be terminated
for cause, give notice not to renew such employment, or be in breach of any
covenant herein.
(a) If during the period ending September 30, 1997,
all of such shares; and
(b) If during the period ending March 31, 1998,
25,000 of such shares.
Section 5.03 The repurchase price of such shares shall be $.10 per
share.
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Section 5.04 The shares certificate or certificates shall bear a
legend referring to this Agreement which shall bind any transferee of such
shares subject to this Agreement in addition to all other restrictions or
limitations. Upon transfer of any such shares, XxXxxxx shall remove such
legend as to shares no longer subject to this Agreement.
Section 5.05 XxXxxxx shall give written notice of exercise of this
right and option within thirty (30) days of any such termination or material
breach to Xxxxxxx or any such holder of such shares then subject to this
Agreement and within thirty (30) days
thereafter such holder shall tender such shares subject to this Agreement as
of the date of such notice to XxXxxxx'x transfer agent conditioned upon
payment of the re-purchase price.
Section 5.06 In the event such shares are not tendered within such
period, then XxXxxxx shall place a stop order on any further transfers of such
shares subject to this Agreement, and all rights and privileges of the holder
of such shares shall terminate.
Section 5.07 The provisions of this Agreement shall bind and inure to
the benefit of the parties, their permissible assigns, heirs and successors.
In the event that such shares are acquired in any merger or stock exchange,
the provisions hereof shall apply to any such shares on a prorata basis issued
in exchange for XxXxxxx'x shares then subject to this Agreement.
ARTICLE 6. EMPLOYEE BENEFITS
Section 6.01 Xxxxxxx shall be entitled to 10 vacation days each year
accrued prorata bimonthly in accordance with XxXxxxx'x Employee Policy Manual.
Xxxxxxx may be absent from his employment for vacation only at such times as
XxXxxxx'x Executive Committee shall determine from time to time. In the event
Xxxxxxx is unable for any reason to take the total amount of vacation time
authorized during any year, he may accrue that time and carry unused time
forward to the next benefit year, provided that the total amount of accrued
and unused vacation benefits shall not exceed a total of 15 days at any time.
Vacation compensation shall be paid at his base rate at the time taken. No
vacation pay will be paid for unused vacation time while employed. Upon
termination of employment he will be paid for any unused vacation time accrued
through the last day of employment.
Section 6.02 Xxxxxxx shall be entitled to 5 days per year as sick
leave accrued prorata monthly compensated at his base pay rate in accordance
with XxXxxxx'x Employee Policy Manual. Unused sick leave shall not be
accumulated beyond 5 days. Sick leave benefits will not be paid if not used.
Section 6.03 XxXxxxx agrees to include Xxxxxxx in the coverage of its
medical, major medical, hospital, dental, and eye care insurance when obtained
by XxXxxxx subject to eligibility.
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ARTICLE 7. BUSINESS EXPENSES
Section 7.01 (a) XxXxxxx shall promptly reimburse Xxxxxxx for all
reasonable business expenses incurred by Xxxxxxx in connection with the
business of XxXxxxx.
(b) Each such expenditure shall be reimbursable only
if it is of a nature qualifying it as a proper deduction on the federal and
state income tax return of XxXxxxx.
(c) Each such expenditure shall be reimbursable only
if Xxxxxxx furnishes to XxXxxxx adequate records and other documentary
evidence required by federal and state statutes and regulations issued by the
appropriate taxing authorities for the substantiation of each such expenditure
as an income tax deduction.
Section 7.02 In the event that any expenses paid for Xxxxxxx or any
reimbursement of expenses paid to Xxxxxxx shall, on audit or other examination
of XxXxxxx'x income tax returns, be determined not to be allowable deductions
from XxXxxxx'x gross income, and in the further event that this determination
shall be acceded to by XxXxxxx or made final by the appropriate federal or
state taxing authority or a final judgment of a court of competent
jurisdiction, and no appeal is taken from the judgment or the applicable
period for filing notice of appeal has expired, Xxxxxxx shall repay to XxXxxxx
the full amount of the disallowed expenses.
ARTICLE 8. TERMINATION OF EMPLOYMENT
Section 8.01 (a) XxXxxxx reserves the right to terminate this
agreement if Xxxxxxx wilfully breaches or habitually neglects the duties which
he is required to perform under the terms of this agreement; or commits such
acts of dishonesty, fraud, misrepresentation or other acts of moral turpitude
as would prevent the effective performance of his duties.
(b) XxXxxxx may at its option terminate this
agreement for the reasons stated in this Section by giving written notice of
termination to Xxxxxxx without prejudice to any other remedy to which XxXxxxx
may entitled either at law, in equity, or under this agreement.
(c) The notice of termination required by this
section shall specify the ground for the termination and shall be supported by
a statement of all relevant facts.
(d) Termination under this section shall be
considered "for cause" for the purposes of this agreement.
Section 8.02 (a) This agreement shall be terminated upon the
death of Xxxxxxx.
(b) XxXxxxx reserves the right to terminate this
agreement not less than three months after Xxxxxxx suffers any physical or
mental disability that would
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prevent the performance of his duties under this agreement. Such a
termination shall be effected by giving 10 days' written notice of termination
to Xxxxxxx.
(c) Termination under this section shall not be
considered "for cause" for the purposes of this agreement.
Section 8.03 (a) This agreement shall be terminated by any
voluntary or involuntary dissolution of XxXxxxx resulting from either a merger
or consolidation in which XxXxxxx is not the consolidated or surviving
corporation, or a transfer of all or substantially all of the assets of
XxXxxxx.
(b) Termination under this section shall not be
considered "for cause" for the purposes of this agreement.
Section 8.04 Notwithstanding any provision of this agreement, if
XxXxxxx terminates this agreement without cause, it shall pay Xxxxxxx an
amount equal to three (3) months' salary at the then current rate of
compensation.
ARTICLE 9. GENERAL PROVISIONS
Section 9.01 Any notices to be given hereunder by either party to the
other shall be in writing and may be transmitted by personal delivery or by
mail, registered or certified, postage prepaid with return receipt requested.
Mailed notice shall be addressed to the parties at the addresses appearing in
the introductory paragraph of this agreement, but each party may change that
address by written notice in accordance with this section. Notices delivered
personally shall be deemed communicated as of the date of actual receipt;
mailed notices shall be deemed communicated as of the date of mailing.
Section 9.02 (a) Any controversy between XxXxxxx and Xxxxxxx
involving the construction or application of any of the terms, provisions, or
conditions of this agreement shall on the written request of either party
served on the other be submitted to arbitration. Arbitration shall comply
with and be governed by the provisions of the California Arbitration Act.
(b) XxXxxxx and Xxxxxxx shall each appoint one
person to hear and determine the dispute. If the two persons so appointed are
unable to agree, then those persons shall select a third impartial arbitrator
whose decision shall be final and conclusive upon both parties.
(c) The cost of arbitration shall be borne by the
losing party or in such proportions as the arbitrators decide.
Section 9.03 If any action at law or in equity is necessary to
enforce or interpret the terms of this agreement, the prevailing party shall
be entitled to reasonable attorney
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fees, costs, and necessary disbursements in addition to any other relief to
which that party may be entitled. This provision shall be construed as
applicable to the entire contract.
Section 9.04 This agreement supersedes any and all other agreements,
either oral or in writing, between the parties hereto with respect to the
employment of Xxxxxxx by XxXxxxx and contains all of the covenants and
agreements between the parties with respect to that employment in any manner
whatsoever. Each party to this agreement acknowledges that no representation,
inducements, promises, or agreements, orally or otherwise, have been made by
any party, or anyone acting on behalf of any party, which are not embodied
herein, and that no other agreement, statement, or promise not contained in
this agreement shall be valid or binding on either party.
Section 9.05 Any modification of this agreement will be effective
only if it is in writing and signed by the party to be charged.
Section 9.06 The failure of either party to insist on strict
compliance with any of the terms, covenants, or conditions of this agreement
by the other party shall not be deemed a waiver of that term, covenant, or
condition, nor shall any waiver or relinquishment of any right or power at any
one time or times be deemed a waiver or relinquishment of that right or power
for all or any other times.
Section 9.07 If any provision in this agreement is held by a court of
competent jurisdiction to be invalid, void, or unenforceable, the remaining
provisions shall nevertheless continue in full force and effect.
Section 9.08 This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
Executed at Carlsbad, California, as of the day and year first above
appearing.
EMPLOYER EMPLOYEE
XxXXXXX METALS, INC.
/s/ Xxxx X. Xxxxx /s/ Xxxxxx X. Xxxxxxx
By: __________________________________ ______________________________
XXXXXX X. XXXXXXX
1945 Camino Xxxx Xxxxx
XxXXXXX METALS GOLF CORP. Xxxxxxxx, XX 00000
/s/ Xxxx X. Xxxxx
By: __________________________________
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