Exhibit 10.3
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Employment Agreement
This employment agreement (the "Agreement") is made and entered into as of April
10, 2006, by and between Emerging Gamma Corporation, a Delaware corporation (the
"Company"), with its principal place of business located at 000 Xxxxxxxx Xxxxxx,
Xxxxxx XX 00000 and Xxxxx Xxxxxxxxxx (the "Employee").
Recitals
The Company desires to employ the Employee from the date set forth above (the
"Effective Date") until expiration of the term of this Agreement, and Employee
is willing to be employed by the Company during that period, on the terms and
subject to the conditions set forth in this Agreement.
In consideration of the mutual covenants and promises of the parties, the
Company and the Employee covenant and agree as follows:
1. Duties
During the term of this Agreement, Employee will be employed by the Company to
serve as the Chief Executive Officer of the company. The Employee will devote
his full time professional activities to the conduct of the business of the
Company as may be reasonably required to effectively discharge Employee's duties
under this Agreement and, subject to the supervision and direction of the
Company's Board of Directors (the "Board"). As Chief Executive Officer, Employee
shall be principally responsible for the overall management of the Company and
implementation of the Company's global strategy and management of all employee
of the Company. Unless the parties agree otherwise in writing, during the term
of this Agreement, Employee will perform the services contemplated by this
Agreement at the Company's offices; provided, however, that Company may, from
time to time, require Employee to travel as required to accomplish the Company's
objectives. Notwithstanding the foregoing, nothing in this Agreement is to be
construed as prohibiting Employee from continuing to serve as a director of
other entities whether or not for profit, so long as his service as such does
not substantially conflict with Employee's duties hereunder and such positions
are disclosed to the Board.
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2. Term of Employment
2.1 Definitions
For purposes of this Agreement the following terms have the following meanings:
(a) "Termination for Cause" means termination by Company of Employee's
employment (i) by reason of Employee's willful dishonesty towards, fraud upon,
or deliberate injury or attempted injury to, the Company, (ii) by reason of
Employee's gross negligence or intentional misconduct with respect to the
performance of Employee's duties under this Agreement or (iii) by reason of
Employee's material breach of this Agreement; provided, however, that no such
termination under subsection (iii) above will be deemed to be a Termination for
Cause unless the Company has provided Employee with written notice of what it
reasonably believes are the grounds for any Termination for Cause and Employee
fails to take appropriate remedial actions during the 45- day period following
receipt of such written notice. The Company is obligated to reasonably provide
the resources to complete the remedial action as required.
(b) "Termination Other than For Cause" means termination by the Company of
Employee's employment by the Company for reasons other than those that
constitute Termination for Cause.
(c) "Voluntary Termination" means termination by the Employee of the Employee's
employment with the Company, excluding termination by reason of Employee's death
or disability as described in Sections 2.5 and 2.6.
2.2 Basic Term
The term of employment of Employee by the Company will commence on the Effective
Date and will extend through the period ending on March 31, 2011, (the
"Termination Date"). Company and Employee may extend the term of this Agreement
by mutual written agreement.
2.3 Termination for Cause
Termination for Cause may be effected by the Company at any time during the term
of this Agreement and may be effected by written notification to Employee.
Notwithstanding the foregoing no Termination for Cause based on Employee's
material breach of this Agreement will be effective unless Employee has been
provided with the prior written notice and opportunity for remedial action
described in Section 2.1. Upon Termination for Cause, Employee is to be
immediately paid all accrued salary. In so far as Employee has accrued any
incentive compensation deferred compensation, stock options, accrued vacation
pay or other compensation, such compensation shall be held in Escrow until such
time as it can reasonably be determined that no unlawful activities have
transpired and therefore no enforcement action is to be undertaken. Any other
compensation including pension plan or profit sharing plan benefits, which will
be paid in accordance with the applicable plan, will cease to accrue as of the
date of termination.
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2.4 Termination Other Than for Cause
Notwithstanding anything else in this Agreement, the Board of Directors may
effect a Termination Other Than for Cause at any time upon giving written notice
to Employee of such Termination Other Than for Cause. Such Termination shall be
effective upon issuance of the written notice. Upon any Termination Other Than
for Cause, Employee will immediately be paid all accrued salary, all incentive
compensation to the extent earned, severance compensation as provided in Section
4, vested deferred compensation (other than pension plan or profit sharing plan
benefits, which will be paid in accordance with the applicable plan), and
accrued vacation pay, all to the date of termination.
2.5 Termination Due to Disability
In the event that, during the term of this Agreement, Employee should, in the
reasonable judgment of the Board, fail to perform Employee's duties under this
Agreement because of illness or physical or mental incapacity ("Disability"),
and such Disability continues for a period of more than six (6) consecutive
months, Company will have the right to terminate Employee's employment under
this Agreement by written notification to Employee and payment to Employee of
all accrued salary and incentive compensation to the extent earned, severance
compensation as provided in Section 4, vested deferred compensation (other than
pension plan or profit sharing plan benefits, which will be paid in accordance
with the applicable plan), and all accrued vacation pay, all to the date of
termination. Any determination by the Board with respect to Employee's
Disability must be based on a determination of competent medical authority or
authorities, a copy of which determination must be delivered to the Employee at
the time it is delivered to the Board. In the event the Employee disagrees with
the determination described in the previous sentence, Employee will have the
right to submit to the Board a determination by a competent medical authority or
authorities of Employee's own choosing to the effect that the aforesaid
determination is incorrect and that Employee is capable of performing Employee's
duties under this Agreement. If, upon receipt of such determination, the Board
wishes to continue to seek to terminate this Agreement under the provisions of
this section, the parties will submit the issue of Employee's Disability to
arbitration in accordance with the provisions of this Agreement.
2.6 Death
In the event of Employee's death during the term of this Agreement, Employee's
employment is to be deemed to have terminated as of the last day of the calendar
quarter during which Employee's death occurred, and Company will pay to
Employee's estate accrued salary, incentive compensation to the extent earned,
vested deferred compensation (other than pension plan or profit sharing plan
benefits, which will be paid in accordance with the applicable plan), and
accrued vacation pay, all to the date of termination.
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2.7 Voluntary Termination
(a) In the event of a Voluntary Termination, other than for OGood Reason,O as
defined below, the Company will immediately pay to Employee all accrued salary,
all incentive compensation to the extent earned, vested deferred compensation
(other than pension plan or profit sharing plan benefits, which will be paid in
accordance with the applicable plan), and accrued vacation pay, all to the date
of termination, but Employee will not be paid any severance compensation.
(b) Upon providing the Company with 60 days advance written notice, the Employee
may voluntarily terminate his/her employment hereunder with or without Good
Reason. For purposes of this Agreement, OGood ReasonO shall mean, so long as the
Employee has not been guilty of conduct set forth in Section 2.1(a), (a) a
failure by the Company to comply with any material provision of this Agreement
that has not been cured within forty five (45) days after written notice of such
noncompliance has been given by the Employee to the Company or (b) the
assignment to the Employee by the Company of duties inconsistent with the
Employee's position, duties or responsibilities as in effect immediately prior
to the Effective Date, including, but not limited to, any material reduction in
such position, duties, or responsibilities or material change in his/her title.
The Employee's election to terminate his/ employment with Good Reason shall be
considered in material respects to be a Termination for Other Than Cause. The
Employee will make themselves generally available, and agrees to work, in good
faith, with the existing management to effect a transitional handover period and
an orderly exit for the Company. Upon a voluntary Termination for Good Reason,
Employee will be paid immediately for all accrued salary, all incentive
compensation to the extent earned, severance compensation as provided in Section
4, vested deferred compensation (other than pension plan or profit sharing plan
benefits, which will be paid in accordance with the applicable plan) and accrued
vacation pay, all to the date of termination.
3. Salary, Benefits and Other Compensation
3.1 Base Salary
As payment for the services to be rendered by Employee as provided in Section 1
and subject to the terms and conditions of Section 2, Company agrees to pay to
Employee a "Base Salary," payable in equal monthly installments. The initial
Base Salary payable to Employee under this Section will be $125,000 per annum.
The payment of Base Salary hereunder shall not in any way limit or reduce any
other obligation of the Company hereunder, and no other compensation, benefit or
payment hereunder shall in any way limit or reduce the obligation of the Company
to pay the Employee's Base Salary hereunder. The Board, at any time and from
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time to time, may increase (but not reduce) the Base Salary payable under this
Agreement, and increase in the Base Salary shall become effective at the time
indicated by the Board without the need for an amendment to this Agreement.
3.2 Incentive & Bonus Plans
Employee will be eligible for any incentive plan. put forward by the Company's
Board of Directors. The Company will institute an employee stock option plan and
Employee's allotment of said program will vest on a quarterly basis. During the
term of his employment under this Agreement, at the Board's discretion, the
Employee will also be eligible to participate in all bonus and incentive plans
established by the Board.
3.3 Benefit Plans
During the term of Employee's employment under this Agreement, the Employee is
to be eligible to participate in all employee benefit plans to the extent
maintained by the Company, including (without limitation) any life, disability,
health, accident and other insurance programs, paid vacations, and similar plans
or programs, subject in each case to the generally applicable terms and
conditions of the plan or program in question and to the determinations of any
committee administering such plan or program. On termination of the Employee for
any reason, the Employee will retain all of Employee's rights to benefits that
have vested under such plan, but the Employee's rights to participate in those
plans will cease on the Employee's termination unless the termination is a
Termination Other Than for Cause, in which case Employee's rights of
participation will continue for a period of six months following Employee's
termination.
3.4 Other Consideration
The Company shall use its best effort to cause the Board of Directors of the
Company (i) to be comprised of a least three members and (ii) to include
Employee, provided that Employee is a beneficial owner as of the record date for
the election of directors of a minimum of five percent (5%) of the shares of the
Company.
3.5 Withholding of Taxes
The Employee understands that the services to be rendered by Employee under this
Agreement will cause the Employee to recognize taxable income, which is
considered under the Internal Revenue Code of 1986, as amended, and applicable
regulations thereunder as compensation income subject to the withholding of
income tax (and Social Security or other employment taxes). The Employee hereby
consents to the withholding of such taxes as are required by the Company.
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3.6 Vacation
During the term of this Agreement, Employee will be entitled to 28 days paid
vacation time per year. To the extent that Employee does not use the full 28
days of vacation time in any given year, Employee may accrue and carry forward
such unused time up to a maximum accrual of 56 days. Employee may not use any
vacation time, accrued or otherwise, for any period in excess of 28 consecutive
days.
3.7 Expenses
During the term of this Agreement, Company will reimburse Employee for
Employee's reasonable out-of-pocket expenses incurred in connection with
Company's business, including travel expenses, food, and lodging while away from
home, subject to such policies as Company may from time to time reasonably
establish for its employees.
4. Severance Compensation
4.1 Termination Other Than for Cause or Voluntary Termination for Good Reason;
Payment in Lieu of Notice
In the event Employee's employment is terminated in a Termination Other Than for
Cause or Employee voluntarily terminates his employment for OGood ReasonO as set
forth in Section 2.7(b), Employee will be paid as severance pay Employee's Base
Salary, as defined in Section 3.1, for the period commencing on the date that
Employee's employment is terminated and ending on the later of the end of
Employee's term of employment or the date which is four-months from the date of
termination.
4.2 Termination for Disability
In the event Employee's employment is terminated because of Employee's
disability pursuant to Section 2.5, Employee will be paid as severance pay
Employee's Base Salary, as defined in Section 3.1, for the period commencing on
the date that Employee's employment is terminated and ending on the date which
is three months thereafter.
4.3 Change in Control
In the event that Employee's employment is terminated because of a change in
control (as defined herein) of the Company prior to the Termination Date,
Employee will be paid as severance pay Employee's Base Salary, as defined in
Section 3.1, for the period commencing on the date that Employee's employment is
terminated and ending on the date which is six months thereafter. For purposes
of this Agreement, a Ochange in controlO shall be defined as the sale of more
than fifty (50%) of the Company's outstanding capital stock, other than in
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connection with an underwritten public offering of the Company's securities or a
merger (or similar transaction) in which the Company is not the surviving entity
or following which the Company's shareholders immediately prior to such
transaction no longer control a majority of the Company's voting stock.
4.4 Other Termination
In the event of a Voluntary Termination, Termination for Cause or Death,
Employee or Employee's estate will not be entitled to any severance pay.
5. Confidentiality and Noncompetition
5.1 Confidentiality
Because of Employee's employment by the Company, Employee will have access to
trade secrets and confidential information about the Company, its products, its
customers, and its methods of doing business (the "Confidential Information").
During and after the termination of Employee's employment by the Company,
Employee may not directly or indirectly disclose or use any such Confidential
Information; provided, that Employee will not incur any liability for disclosure
of information which (a) is required in the course of Employee's employment by
the Company, (b) was permitted in writing by the Board or (c) is within the
public domain or comes within the public domain without any breach of this
Agreement.
5.2 Noncompetition
In consideration of Employee's access to the Confidential Information, Employee
agrees with employer that for a period of six (6) months after termination of
Employee's employment, Employee will not, directly or indirectly, compete with
Company or use such Confidential Information to compete with the business of the
Company, as the business of the Company may then be constituted, within any
state, region or locality in which the Company is then doing business or
marketing its products. Employee understands and agrees that direct competition
means development, production, promotion, or sale of products or services
competitive with those of Company. Indirect competition means employment by any
competitor or third party providing products competing with Company's products,
for which Employee will perform the same or similar function as he performs for
Company. In addition, for a period of six (6) months after termination of
Employee's employment, Employee will not induce or attempt to induce any
employee of the Company to discontinue his or her employment with the Company
for the purpose of becoming employed by any competitor of Company, nor will
Employee initiate discussions, negotiations or contacts with persons known by
Employee to be a customer or supplier of the Company at the time of Employee's
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termination of employment for the purpose of competing with the Company.
Notwithstanding anything to the contrary contained in the Agreement, the
provisions of this Section 5.2 will not be applicable in the event of any
Termination Other Than for Cause with respect to Employee.
6. Miscellaneous
6.1 Waiver
The waiver of any breach of any provision of this Agreement will not operate or
be construed as a waiver of any subsequent breach of the same or other provision
of this Agreement.
6.2 Entire Agreement; Modification
Except as otherwise provided in the Agreement and in any resulting Option
Agreement, this Agreement represents the entire understanding among the parties
with respect to the subject matter of this Agreement, and this Agreement
supersedes any and all prior understandings, agreements, plans, and
negotiations, whether written or oral, with respect to the subject matter
hereof, including without limitation, any understandings, agreements, or
obligations respecting any past or future compensation, bonuses, reimbursements,
or other payments to Employee from Company. All modifications to the Agreement
must be in writing and signed by the party against whom enforcement of such
modification is sought.
6.3 Notice
All notices and other communications under this Agreement must be in writing and
must be given by personal delivery, telecopier or telegram, or first class mail,
certified or registered with return receipt requested, and will be deemed to
have been duly given upon receipt if personally delivered, three (3) days after
mailing, if mailed, or twenty-four (24) hours after transmission, if delivered
by telecopies or telegram, to the respective persons named below:
If to Company:
Emerging Gamma Corp.
000 Xxxxxxxx Xxxxxx
0xx Xxxxx
Xxxxxx, XX 00000
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Attn:
Chairman
If to Employee:
Xxxxx Xxxxxxxxxx
0000 Xxxxxxxxx Xxxxxx
Xxx Xxxxx 00000
Telephone: (000) 000-0000
Any party may change such party's address for notices by notice duly given
pursuant to this Section.
6.4 Headings
The Section headings of this Agreement are intended for reference and may not by
themselves determine the construction or interpretation of this Agreement.
6.5 Governing Law
This Agreement is to be governed by and construed in accordance with the laws of
the State of Nevada applicable to contracts entered into and wholly to be
performed within the State of Nevada. Any controversy or claim arising out of or
relating to this Agreement, or breach of this Agreement (except for any
controversy or claim with respect to Section 5, which may be submitted, at the
option of the Company, to any court of competent jurisdiction located within Las
Vegas, Nevada) is to be settled by arbitration in Las Vegas, Nevada in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association, and judgment on the award rendered by the arbitrators may be
entered in any court having jurisdiction. There must be three arbitrators, one
to be chosen directly by each party at will, and the third arbitrator to be
selected by the two arbitrators so chosen. Each party will pay the fees of the
arbitrator he or she selects and his or her own attorneys, and the expenses of
his or her witnesses and all other expenses connected with presenting his or her
case. Other costs of the arbitration, including the cost of any record or
transcripts of the arbitration, administrative fees, the fee of the third
arbitrator, and all other fees and costs, will be borne equally by the parties.
6.6 Survival of Company's Obligations
This Agreement will be binding on, and inure to the benefit of, the executors,
administrators, heirs, successors, and assigns of the parties; provided,
however, that except as expressly provided in this Agreement, this Agreement may
not be assigned either by Company or by Employee.
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6.7 Counterparts
This Agreement may be executed in one or more counterparts, all of which taken
together will constitute one and the same Agreement.
6.8 Enforcement
If any portion of this Agreement is determined to be invalid or unenforceable,
that portion of this Agreement will be adjusted, rather than voided, to achieve
the intent of the parties under this Agreement.
6.9 Indemnification
The Company agrees that it will indemnify and hold the Employee harmless to the
fullest extent permitted by applicable law from and against any loss, cost,
expense or liability resulting from or by reason of the fact of the Employee's
employment hereunder, whether as an officer, employee, agent, fiduciary,
director or other official of the Company, except to the extent of any expenses,
costs, judgments, fines or settlement amounts which result from conduct which is
determined by a court of competent jurisdiction to be knowingly fraudulent or
deliberately dishonest or to constitute some other type of willful misconduct.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.
Emerging Gamma Corp.
By________________________________
Xxxxx Xxxxxxxx,
Chairman
EMPLOYEE
__________________________________
Xxxxx Xxxxxxxxxx
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