EXECUTIVE EMPLOYMENT AGREEMENT
This
Executive Employment Agreement, dated August 6th, 2008
(the "Commencement
Date"), is between Sunburst Acquisitions III,
Inc., a Colorado corporation (the "Company") and Xxxxxx Xxxxxx, an individual
residing at 0000 X. 000xx Xxxxx,
Xxxx 0, Xxxxxxxxx, Xxxxxxxxxx ("Executive").
1.
Position and Responsibilities
(a) Position. Executive is
employed by the Company to render services to the Company in the position of
Chief Executive
Officer. Executive shall perform such duties and
responsibilities as are normally related to such position in accordance with the
standards of the industry and any additional duties now or hereafter assigned to
Executive by the Company. Executive shall abide by the rules, regulations, and
practices as adopted or modified from time to time in the Company’s sole
discretion.
(b) No Conflict.
Executive represents and warrants that Executive's execution of this
Agreement, Executive's employment with the Company, and the performance of
Executive's proposed duties under this Agreement shall not violate any
obligations Executive may have to any other employer, person or entity,
including any obligations with respect to proprietary or confidential
information of any other person or entity.
(c) Term. The term of
employment of Executive by the Company pursuant to this Employment Agreement
shall be for the period commencing on the Commencement Date and ending on the
two year anniversary of the Commencement Date, or such earlier date that
Employee's employment is terminated in accordance with the provisions of this
Employment Agreement.
2.
Compensation and Benefits
(a) Base Salary. In
consideration of the services to be rendered under this Agreement, the Company
shall pay Executive a salary no less than Seventy-five Thousand Dollars
($75,000) per year ("Base Salary"). The
Base Salary shall be paid in accordance with the Company's regularly established
payroll practice. Executive's Base Salary will be reviewed from time
to time in accordance with the established procedures of the Company for
adjusting salaries for similarly situated employees and may be adjusted in the
sole discretion of the Company.
(b) Stock
Options. The Executive is entitled to an option to purchase
One Hundred Seventy Million Forty-Six Thousand (170,046,000) shares of the
common stock of the Company. The price per share of the option is
$0.00001. The option will expire on August 6th, 2013,
will vest in full immediately, and will be issued as soon as practicable after
sufficient common shares have been authorized under the Company’s Articles of
Incorporation. The shares underlying the option shall have piggyback
registration rights. The Executive’s entitlement to any stock options
is conditioned upon Executive’s signing of a separate stock option
agreement. The Executive may also receive additional stock option
grants pursuant to a Company stock option plan.
(c) Benefits. Executive shall
be eligible to participate in the benefits made generally available by the
Company to similarly-situated Executives, in accordance with the benefit plans
established by the Company, and as may be amended from time to time in the
Company's sole discretion. With respect to medical insurance,
Executive shall be eligible for full medical benefits under the Company's
medical benefits plan, or equivalent medical coverage at the Company's
cost.
(d) Expenses. The Company
shall reimburse Executive for reasonable business expenses incurred in the
performance of Executive's duties hereunder in accordance with the Company's
expense reimbursement guidelines.
(e) Right to
Renegotiate. The Executive shall have the right to renegotiate
this section, Section 2 regarding Compensation and Benefits, in part or in its
entirety.
3.
At-Will Employment; Termination By Company
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(a) At-Will Termination by Company.
The employment of Executive shall be "at-will" at all
times. The Company may terminate Executive's employment with the
Company at any time, without any advance notice, for any reason or no reason at
all, notwithstanding anything to the contrary contained in or arising from any
statements, policies or practices of the Company relating to the employment,
discipline or termination of its employees. Upon and after such
termination, all obligations of the Company under this Agreement shall cease,
unless Executive's employment is terminated without Cause, in which case Company
shall provide Executive with the severance benefits described in Section 3(b)
below.
(b) Severance. Except in
situations where the employment of Executive is terminated For Cause, By Death
or By Disability (as defined in Section 4 below), in the event that the Company
terminates the employment of Executive at any time, Executive will be eligible
to receive an amount equal to twelve (12) months of the then-current Base Salary
of the Executive payable in the form of salary continuation. Such
Severance shall be reduced by any remuneration paid to Executive because of
Executive's employment or self-employment during the severance
period. Executive shall not be entitled to any severance payments if
Executive's employment is terminated For Cause, By Death or By Disability (as
defined in Section 4 below) or if Executive's employment is terminated by
Executive (in accordance with Section 5 below).
4.
Other Terminations By Company
(a) Termination for Cause. For
purposes of this Agreement, "For Cause" shall
mean: (i) Executive commits a crime involving dishonesty, breach of trust, or
physical harm to any person; (ii) Executive willfully engages in conduct that is
in bad faith and materially injurious to the Company, including but not limited
to, misappropriation of trade secrets, fraud or embezzlement; (iii) Executive
commits a material breach of this Agreement, which breach is not cured within
twenty (30) days after written notice to Executive from the Company; (iv)
Executive willfully refuses to implement or follow a lawful policy or directive
of the Company, which breach is not cured within twenty (30) days after written
notice to Executive from the Company; or (v) Executive engages in misfeasance or
malfeasance demonstrated by a pattern of failure to perform job duties
diligently and professionally. The Company may terminate Executive's
employment For Cause at any time, without any advance notice. The
Company shall pay to Executive all compensation to which Executive is entitled
up through the date of termination, subject to any other rights or remedies of
Employer under law; and thereafter all obligations of the Company under this
Agreement shall cease.
(b) By Death.
Executive's employment shall terminate automatically upon Executive's
death. The Company shall pay to Executive's beneficiaries or estate,
as appropriate, any compensation then due and owing. Thereafter all
obligations of the Company under this Agreement shall cease. Nothing
in this Section shall affect any entitlement of Executive's heirs or devisees to
the benefits of any life insurance plan or other applicable
benefits.
(c) By Disability. If
Executive becomes eligible for the Company's long term disability benefits or
if, in the sole opinion of the Company, Executive is unable to carry out the
responsibilities and functions of the position held by Executive by reason of
any physical or mental impairment for more than ninety (90) consecutive days or
more than one hundred and twenty days (120) in any twelve-month period, then, to
the extent permitted by law, the Company may terminate Executive's
employment. The Company shall pay to Executive all compensation to
which Executive is entitled up through the date of termination, and thereafter
all obligations of the Company under this Agreement shall
cease. Nothing in this Section shall affect Executive's rights under
any disability plan in which Executive is a participant.
5.
Termination By Executive
(a) At-Will Termination by Executive.
Executive may terminate employment with the Company at any time for any
reason or no reason at all, upon four weeks' advance written notice. During such
notice period Executive shall continue to diligently perform all of Executive's
duties hereunder. The Company shall have the option, in its sole
discretion, to make Executive's termination effective at any time prior to the
end of such notice period as long as the Company pays Executive all compensation
to which Executive is entitled up through the last day of the four week notice
period. Thereafter all obligations of the Company shall cease.
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(b) Termination for Good Reason After
Change of Control. Executive's termination shall be for "Good Reason" if
Executive provides written notice to the Company of the Good Reason within
thirty (30) days of the event constituting Good Reason and provides the Company
with a period of twenty (20) days to cure the event constituting Good Reason and
the Company fails to cure the Good Reason within that period. For
purposes of this Agreement, "Good Reason" shall
mean any of the following events if (i) the event is effected by the Company
without the consent of Executive and (ii) such event
occurs within six (6) months following a Change in Control (as hereinafter
defined): (A) a change in Executive's position with Employer which
materially reduces Executive's level of responsibility; (B) a material reduction
in Executive's Base Salary, except for reductions that are comparable to
reductions generally applicable to similarly situated executives of the Company;
or (C) a relocation of Executive's principal place of employment by more than
twenty-five (25) miles. In such event Executive may terminate his
employment for Good Reason, in which case Executive will be eligible to receive
an amount equal to twelve (12) months of Executive's then-current Base Salary
payable in the form of salary continuation. Such Severance shall be
reduced by any remuneration paid to Executive because of Executive's employment
or self-employment during the severance period. Thereafter all
obligations of the Company or its successor under this Agreement shall
cease.
(c) "Change of Control."
For purposes of this Agreement, "Change of Control"
shall mean a change in ownership or control of the Company effected through a
merger, consolidation or acquisition by any person or related group of persons
(other than an acquisition by the Company or by a Company-sponsored employee
benefit plan or by a person or persons that directly or indirectly controls, is
controlled by, or is under common control with, the Company) of beneficial
ownership (within the meaning of Rule 13d-3 of the Securities Exchange Act of
1934) of securities possessing more than fifty percent of the total combined
voting power of the outstanding securities of the Company.
6.
Termination Obligations
(a) Return of
Property. Executive agrees that all property (including
without limitation all equipment, tangible proprietary information, documents,
records, notes, contracts and computer-generated materials) furnished to or
created or prepared by Executive incident to Executive's employment belongs to
the Company and shall be promptly returned to the Company upon termination of
Executive's employment.
(b) Resignation and Cooperation.
Upon termination of Executive's employment, Executive shall be deemed to
have resigned from all offices and directorships then held with the
Company. Following any termination of employment, Executive shall
cooperate with the Company in the winding up of pending work on behalf of the
Company and the orderly transfer of work to other employees.
(c) Continuing Obligations.
Executive understands and agrees that Executive's obligations under
Sections 6, 7, and 8 herein (including Exhibits A and B) shall survive the
termination of Executive's employment for any reason and the termination of this
Agreement.
7.
Inventions and Proprietary Information; Prohibition on Third Party
Information
(a) Proprietary Information
Agreement. Executive agrees to sign and be bound by the terms of the
Proprietary Information and Inventions Agreement, which is attached as Exhibit A
("Proprietary
Information Agreement").
(b) Non-Solicitation.
Executive acknowledges that because of Executive's position in the
Company, Executive will have access to material intellectual property and
confidential information. During the term of Executive's employment
and for one year thereafter, in addition to Executive's other obligations
hereunder or under the Proprietary Information Agreement, Executive shall not,
for Executive or any third party, directly or indirectly (i) divert or attempt
to divert from the Company any business of any kind, including without
limitation the solicitation of or interference with any of its customers,
clients, members, business partners or suppliers, or (ii) solicit or otherwise
induce any person employed by the Company to terminate his
employment.
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(c) Non-Disclosure of Third
Party Information. Executive represents and warrants and covenants that
Executive shall not disclose to the Company, or use, or induce the Company to
use, any proprietary information or trade secrets of others at any time,
including but not limited to any proprietary information or trade secrets of any
former employer, if any; and Executive acknowledges and agrees that any
violation of this provision shall be grounds for Executive's immediate
termination For Cause and could subject Executive to substantial civil
liabilities and criminal penalties. Executive further specifically
and expressly acknowledges that no officer or other employee or representative
of the Company has requested or instructed Executive to disclose or use any such
third party proprietary information or trade secrets.
8.
Arbitration
a.
ARBITRATION. EXCEPT AS PROVIDED IN SECTION 8(b) BELOW,
EXECUTIVE AGREES THAT ANY DISPUTE OR CONTROVERSY ARISING OUT OF,
RELATING TO, OR CONCERNING ANY INTERPRETATION, CONSTRUCTION, PERFORMANCE OR
BREACH OF THIS AGREEMENT, SHALL BE SETTLED BY ARBITRATION TO BE HELD IN LOS
ANGELES COUNTY, CALIFORNIA, IN ACCORDANCE WITH THE RULES THEN IN EFFECT OF THE
AMERICAN ARBITRATION ASSOCIATION. THE ARBITRATOR MAY GRANT
INJUNCTIONS OR OTHER RELIEF IN SUCH DISPUTE OR CONTROVERSY. THE DECISION OF THE
ARBITRATOR SHALL BE FINAL, CONCLUSIVE AND BINDING ON THE PARTIES TO THE
ARBITRATION. JUDGMENT MAY BE ENTERED ON THE ARBITRATOR'S DECISION IN ANY COURT
HAVING JURISDICTION. THE COMPANY SHALL PAY ALL OF THE COSTS AND EXPENSES OF SUCH
ARBITRATION, AND EACH OF THE COMPANY AND EXECUTIVE SHALL SEPARATELY PAY THEIR
COUNSEL FEES AND EXPENSES.
THIS
ARBITRATION CLAUSE CONSTITUTES A WAIVER OF EXECUTIVE'S RIGHT TO A JURY TRIAL AND
RELATES TO THE RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE
EMPLOYER/EMPLOYEE RELATIONSHIP (EXCEPT AS PROVIDED IN SECTION 8(b) BELOW),
INCLUDING, BUT NOT LIMITED TO, THE FOLLOWING CLAIMS:
i. ANY
AND ALL CLAIMS FOR WRONGFUL DISCHARGE OF EMPLOYMENT; BREACH OF CONTRACT, BOTH
EXPRESS AND IMPLIED; BREACH OF THE COVENANT OF GOOD FAITH AND FAIR DEALING, BOTH
EXPRESS AND IMPLIED; NEGLIGENT OR INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS;
NEGLIGENT OR INTENTIONAL MISREPRESENTATION; NEGLIGENT OR INTENTIONAL
INTERFERENCE WITH CONTRACT OR PROSPECTIVE ECONOMIC ADVANTAGE; AND
DEFAMATION;
ii. ANY
AND ALL CLAIMS FOR VIOLATION OF ANY FEDERAL, STATE OR MUNICIPAL STATUTE,
INCLUDING, BUT NOT LIMITED TO, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, THE
CIVIL RIGHTS ACT OF 1991, THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, THE
AMERICANS WITH DISABILITIES ACT OF 1990, THE FAIR LABOR STANDARDS ACT, THE
CALIFORNIA FAIR EMPLOYMENT AND HOUSING ACT, AND LABOR CODE SECTION 201, et
seq.;
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iii. ANY
AND ALL CLAIMS ARISING OUT OF ANY OTHER LAWS AND REGULATIONS RELATING TO
EMPLOYMENT OR EMPLOYMENT DISCRIMINATION.
b.
EQUITABLE REMEDIES. EXECUTIVE AGREES THAT IT WOULD BE IMPOSSIBLE OR INADEQUATE
TO MEASURE AND CALCULATE THE COMPANY'S DAMAGES FROM ANY BREACH OF THE COVENANTS
SET FORTH IN SECTIONS 1 AND 7 HEREIN. ACCORDINGLY, EXECUTIVE AGREES THAT IF
EXECUTIVE BREACHES ANY OF SUCH SECTIONS, THE COMPANY WILL HAVE AVAILABLE, IN
ADDITION TO ANY OTHER RIGHT OR REMEDY AVAILABLE, THE RIGHT TO OBTAIN AN
INJUNCTION FROM A COURT OF COMPETENT JURISDICTION RESTRAINING SUCH BREACH OR
THREATENED BREACH AND TO SPECIFIC PERFORMANCE OF ANY SUCH PROVISION OF THIS
AGREEMENT. I FURTHER AGREE THAT NO BOND OR OTHER SECURITY SHALL BE REQUIRED IN
OBTAINING SUCH EQUITABLE RELIEF AND I HEREBY CONSENT TO THE ISSUANCE OF SUCH
INJUNCTION AND TO THE ORDERING OF SPECIFIC PERFORMANCE.
c.
CONSIDERATION. EXECUTIVE UNDERSTANDS THAT EACH PARTY'S PROMISE TO RESOLVE CLAIMS
BY ARBITRATION IN ACCORDANCE WITH THE PROVISIONS OF THIS AGREEMENT, RATHER THAN
THROUGH THE COURTS, IS CONSIDERATION FOR THE OTHER PARTY'S LIKE PROMISE.
EXECUTIVE FURTHER UNDERSTANDS THAT EXECUTIVE IS OFFERED EMPLOYMENT IN
CONSIDERATION OF EXECUTIVE’S PROMISE TO ARBITRATE CLAIMS.
9.
Amendments; Waivers; Remedies
This
Agreement may not be amended or waived except by a writing approved by the Board
of Directors and signed by Executive and by a duly authorized representative of
the Company other than Executive. Failure to exercise any right under this
Agreement shall not constitute a waiver of such right. Any waiver of any breach
of this Agreement shall not operate as a waiver of any subsequent breaches. All
rights or remedies specified for a party herein shall be cumulative and in
addition to all other rights and remedies of the party hereunder or under
applicable law.
10.
Assignment; Binding Effect
(a) Assignment. The
performance of Executive is personal hereunder, and Executive agrees that
Executive shall have no right to assign and shall not assign or purport to
assign any rights or obligations under this Agreement. This Agreement
may be assigned or transferred by the Company; and nothing in this Agreement
shall prevent the consolidation, merger or sale of the Company or a sale of any
or all or substantially all of its assets.
(b) Binding
Effect. Subject to the foregoing restriction on assignment by
Executive, this Agreement shall inure to the benefit of and be binding upon each
of the parties; the affiliates, officers, directors, agents, successors and
assigns of the Company; and the heirs, devisees, spouses, legal representatives
and successors of Executive.
11.
Notices
All
notices or other communications required or permitted hereunder shall be made in
writing and shall be deemed to have been duly given if delivered: (a)
by hand; (b) by a nationally recognized overnight courier service; or (c) by
United States first class registered or certified mail, return receipt
requested, to the principal address of the other party, as set forth
below. The date of notice shall be deemed to be the earlier of (i)
actual receipt of notice by any permitted means, or (ii) two (2) business days
following dispatch by overnight delivery service or five (5) business days
following dispatch by the United States Mail. Executive shall be
obligated to notify the Company in writing of any change in Executive’s
address. Notice of change of address shall be effective only when
done in accordance with this paragraph.
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Company's
Notice Address:
Sunburst
Acquisitions III, Inc.
c/o
Percipio Biotherapeutics, Inc.
00000
Xxxxxxxx Xxxx., Xxxxx 0000
Xxx
Xxxxxxx, XX 00000
Executive's
Notice Address:
Xxxxxx Xxxxxx
0000 X. 000xx Xxxxx,
Xxxx 0
Xxxxxxxxx, XX 00000
12.
Severability
If any
provision of this Agreement shall be held by a court or arbitrator to be
invalid, unenforceable, or void, such provision shall be enforced to the fullest
extent permitted by law, and the remainder of this Agreement shall remain in
full force and effect. In the event that the time period or scope of any
provision is declared by a court or arbitrator of competent jurisdiction to
exceed the maximum time period or scope that such court or arbitrator deems
enforceable, then such court or arbitrator shall reduce the time period or scope
to the maximum time period or scope permitted by law.
13.
Taxes
All
amounts paid under this Agreement (including without limitation Base Salary and
Severance) shall be paid less all applicable state and federal tax withholdings
and any other withholdings required by any applicable jurisdiction.
14.
Governing Law
This
Agreement shall be governed by and construed in accordance with the laws of the
State of California.
15.
Interpretation
This
Agreement shall be construed as a whole, according to its fair meaning, and not
in favor of or against any party. Sections and section headings contained in
this Agreement are for reference purposes only, and shall not affect in any
manner the meaning or interpretation of this Agreement. Whenever the
context requires, references to the singular shall include the plural and the
plural the singular.
16.
Obligations Survive Termination Of Employment
Executive
agrees that any and all of Executive's obligations under this agreement,
including but not limited to Exhibits B and C, shall survive the termination of
employment and the termination of this Agreement.
17.
Counterparts
This
Agreement may be executed in any number of counterparts, each of which shall be
deemed an original of this Agreement, but all of which together shall constitute
one and the same instrument.
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18.
Authority
Each
party represents and warrants that such party has the right, power and authority
to enter into and execute this Agreement and to perform and discharge all of the
obligations hereunder; and that this Agreement constitutes the valid and legally
binding agreement and obligation of such party and is enforceable in accordance
with its terms.
19.
Entire Agreement
This
Agreement is intended to be the final, complete, and exclusive statement of the
terms of Executive's employment by the Company and may not be contradicted by
evidence of any prior or contemporaneous statements or agreements, except for
agreements specifically referenced herein (including the Proprietary Information
and Inventions Agreement attached as Exhibit A and the Arbitration Agreement
attached as Exhibit B). To the extent that the practices, policies or
procedures of the Company, now or in the future, apply to Executive and are
inconsistent with the terms of this Agreement, the provisions of this Agreement
shall control. Any subsequent change in Executive's duties, position, or
compensation will not affect the validity or scope of this
Agreement.
20.
Executive Acknowledgement
EXECUTIVE
ACKNOWLEDGES EXECUTIVE HAS HAD THE OPPORTUNITY TO CONSULT LEGAL COUNSEL
CONCERNING THIS AGREEMENT, THAT EXECUTIVE HAS READ AND UNDERSTANDS THE
AGREEMENT, THAT EXECUTIVE IS FULLY AWARE OF ITS LEGAL EFFECT, AND THAT EXECUTIVE
HAS ENTERED INTO IT FREELY BASED ON EXECUTIVE’S OWN JUDGMENT AND NOT ON ANY
REPRESENTATIONS OR PROMISES OTHER THAN THOSE CONTAINED IN THIS
AGREEMENT.
IN WITNESS WHEREOF, the
parties have duly executed this Agreement as of the date first written
above.
| SUNBURST ACQUISITIONS III, INC.: | |||
|
|
By:
|
/s/ Xxxxx Xxx Xxxxxxxx | |
| Xxxxx Xxx Xxxxxxxx | |||
| Director | |||
| EXECUTIVE: | |||
|
|
By:
|
/s/ Xxxxxx Xxxxxx | |
| Xxxxxx Xxxxxx | |||
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