Exhibit 10.20
DISSOLUTION OF EMPLOYMENT AGREEMENT AND
RESTATEMENT OF CONSULTING AGREEMENT
This DISSOLUTION OF EMPLOYMENT AGREEMENT AND restatement of consulting
AGREEMENT ("Agreement") is entered into by and among Cirilium Holdings, Inc., a
corporation formed and existing under the laws of the State of Delaware and/or
its respective directors, officers, agents, employees, successors, affiliates,
joint employers, assigns and anyone acting in concert with them jointly and
severally or individually, (hereinafter collectively referred to as "Cirilium"),
LeeWard Enterprises CTI, Inc., a Florida corporation and/or its respective
directors, officers, agents, employees, successors, affiliates, joint employers,
assigns and anyone acting in concert with it jointly and severally or
individually (hereinafter collectively referred to as the "Contractor"), and
Xxxxxx X. Xxxx, a natural person over the age of eighteen (18) years and a
resident of the State of Florida ("Lees").
WHEREAS Cirilium and Lees have entered into a certain employment agreement
("Employment Agreement") on April 1, 2004, which they now wish to amend and
dissolve in accordance with the terms herein;
WHEREAS Cirilium and Lees desire that this Agreement amend and dissolve in
its entirety the Employment Agreement as though it never existed;
WHEREAS Cirilium and the Contractor have entered into a certain consulting
agreement ("First Consulting Agreement") on April 1, 2004, which they now wish
to amend and restate;
WHEREAS Cirilium and the Contractor desire that this Agreement amend and
restate in its entirety the First Consulting Agreement;
NOW, THEREFORE, in consideration of the mutual covenants as herein
described, and other good and valuable consideration the sufficiency of which is
hereby acknowledged, Cirilium and the Contractor and Lees (collectively the
"Parties" or individually the "Party") agree as to the following:
1. EMPLOYMENT AGREEMENT
1.1 Cirilium and Lees hereby agree to dissolve the Employment Agreement as
though it never existed.
1.2 In consideration for Lees agreeing to dissolve the Employment
Agreement in its entirety as though it never existed, Cirilium shall tender to
Lees, and Lees shall accept, five hundred thousand (500,000) shares of
restricted common stock of Cirilium Holdings, Inc ("Stock Tender").
1.3 Cirilium and Lees represent that the Stock Tender was tendered and
accepted on or about April 1, 2004.
1.4 For the good and valuable consideration referenced in Section 1.2,
Lees hereby agrees to release, acquit, satisfy, and forever discharge Cirilium
from any and all manner of action and actions, cause and causes of action,
suits, debts, dues, sums of money, wages, accounts, commissions, bonuses,
reckonings, benefits, bonds, bills, specialties, covenants, contracts,
controversies, promises, variances, trespasses, damages, judgments, executions,
claims, and demands whatsoever, in law or equity, which Lees had, or now has, or
hereafter can, shall or may have, against Cirilium by reason of any matter,
cause or thing whatsoever, from the beginning of the world to today, and shall
include, but not be limited to, any claims, charges, grievances, or causes of
action arising out of Lees' employment with Cirilium, compensation by Cirilium,
or separation from employment with Cirilium. This Section includes any causes of
action or claims under the Title VII of the Civil Rights Act of 1964, as
amended; the Employee Retirement Income Security Act of 1974, as amended; the
Florida Human Rights Act of 1977, as amended; the Equal Pay Act of 1963, as
amended; the Americans with Disabilities Act; the Civil Rights Act of 1991; the
Family and Medical Leave Act; federal or state Whistleblower Acts; Florida
Statutes Chapters 760, 440, and 448 (Florida's civil rights, unemployment and
worker's compensation acts), and any other federal or state law or municipal
ordinance, including any lawsuits founded in tort (including negligence or
fraud), contract (oral, written or implied) or any other common law or equitable
basis of action, up to and including the effective date of this Section. And,
Lees agrees not to institute administrative proceedings or a lawsuit against
Cirilium, and represents and warrants that no other person or entity has
initiated or will initiate such proceedings or lawsuit on Lees' behalf.
2. FIRST CONSULTING AGREEMENT
The First Consulting Agreement shall be deleted in its entirety as though
it never existed and replaced with this Agreement.
3. CONTRACTOR'S SERVICES TO CIRILIUM
3.1 SERVICES. The Contractor shall use its best efforts to further the
interests of Cirilium in providing the Services and accordingly assist Cirilium
in business management, strategic development, asset management, operations,
customer development, technology development, and any other necessary assistance
Cirilium may require. In addition to the prior general obligation, specifically
Contractor shall be engaged by the Company to perform the following duties (the
"Services"):
3.1.1 Engage in the duties, responsibilities, and obligations of
Chief Executive Officer of Cirilium.
3.1.2 Prepare and implement a strategic vision and plan for the
future development and growth of Cirilium, and periodically
present such plan to the Board of Directors for general review
and approval, as prescribed by Cirilium's policy and the
By-Laws in separate writings.
2
3.1.3 Participate in the production of and review all filings with
the Securities and Exchange Commission.
3.1.4 Ensure Cirilium is current in all reporting obligations and
ensure Cirilium's trading status on the Over The Counter
Bulletin Board is maintained;
3.1.4 Monitor the adequacy and soundness of Cirilium's financial
structure, including reviewing projections of Cirilium's
working capital requirements, and commencing negotiations or
otherwise arranging for outside financing as may be necessary.
3.1.5 Plan and direct strategies for identifying, investigating, and
negotiating mergers, joint ventures, acquisition of
businesses, or the sale of Cirilium's assets pursuant to
Cirilium policy.
3.1.6 Participating in developing investor relations strategies to
ensure adequate access to public markets, compliance with
security regulations, and trading liquidity for Cirilium's
shareholders.
3.1.7 Establish and maintain executive level customer account
relationships for the benefit of Cirilium, and utilize the
Board of Directors to strategically develop existing and
potential customer relationships.
3.1.8 Accept overall responsibility for ensuring Cirilium's
compliance with all applicable federal, state, and local laws,
ordinances, regulations, rules, and the like.
3.2 BEST STANDARDS. In the performance of the Services, Contractor shall
perform its duties and the Services within or above the best standards in the
community at large for the provision of such services. Further, Contractor shall
use its experience in providing the Services, and it is expressly understood
that Cirilium is basing its decision to engage Contractor pursuant to
representations of such experience.
3.3 LEES. The Contractor acknowledges and expressly agrees that Lees is
the only person expressly authorized to perform any and all of the Services
listed herein during the Term of this Agreement. The Contractor and Lees
represent and warrant that they have entered into a separate agreement
("Contractor and Lees' Agreement") whereby Lees shall perform Services on the
Contractor's behalf, the terms of which are substantially similar to the
following:
3.3.1 The Contractor shall compensate Lees, and Lees shall
perform the Services contained within this Agreement.
3.3.1.1 As a condition of the Contractor and Lees'
Agreement, as referenced supra, the Contractor,
expressly intending that Lees be a third party
beneficiary to this Agreement, hereby assigns to Lees
the Contractor's entitlement to any and all Options for
which the Contractor may be eligible under Section 3.4.2
infra.
3
3.3.1.2 Lees hereby accepts the Contractor's assignment
and relies thereupon.
3.3.1.3 The Parties collectively acknowledge and agree
that Lees is an intended third party beneficiary of the
Contractor.
3.3.2 Lees shall perform and fulfill the Contractor's
obligations to perform the Services hereunder,
specifically that of Chief Executive Officer.
3.3.3 Lees shall perform his duties and the Services within or
above the best standards in the community at large for
the provision of such services.
3.3.4 It is the understanding of the Parties that this
Agreement does not constitute nor create an employment
agreement between Cirilium and Lees. It is the intention
of the parties that Lees shall not the be Cirilium's
employee for any and or all purposes, including, but not
limited to, the application of any federal or state law
relating to employment or tax liability. It is the
further understanding of the parties Lees will not be
eligible to participate in any of the employee benefit
plans and programs offered by Cirilium to its employees.
Lees acknowledges that he is compensated solely by the
Contractor, and that Lees will not be entitled to
vacation or sick pay or any benefits under Cirilium's
pension, profit sharing, health, disability, life
insurance, severance, or any other plan or program of
employee benefits provided by Cirilium to its employees.
3.3.4.1 Lees and the Contractor shall be responsible for
the withholding and payment, if any, of any required
state and federal payroll taxes, including income, FICA,
FUTA and state unemployment for any assistants or
employees retained by Contractor. Cirilium shall not be
required to make any payroll withholdings with respect
to its payments under this Agreement.
3.3.5 The Contractor and Lees' Agreement shall include
provisions substantially similar to the provisions
protecting Cirilium as contained within Sections 5
through 10 herein.
3.4 CONSIDERATION. In consideration for the Services described above,
Cirilium shall tender to the Contractor, and the Contractor shall accept, the
following:
3.4.1 The sum of eighty four thousand dollars ($84,000.00) per
year throughout the Term of this Agreement ("Payment").
Such Payment shall be disbursed in semi-monthly
installments.
4
3.4.2 The Contractor shall be entitled to receive incentive
stock options, which shall entitle the Contractor to
purchase up to five hundred thousand shares (500,000)
shares of Cirilium's restricted common stock, at an
exercise price of one one-hundredth of one cent
($0.0001) per share ("Options"). The Options shall vest
in one-third (1/3) increments, over the course of thirty
six (36) months, of approximately one hundred sixty-six
thousand six hundred sixty-six (166,666) shares per year
on each anniversary date of April 1, 2004:
Vesting Date Number of Options
------------- -----------------
April 1, 2005 166,666
April 1, 2006 166,667
April 1, 2007 166,666
4. TERM
This Agreement shall be in full force and effect beginning April 1, 2004 and
continuing for a period of three (3) years, unless earlier terminated at any
time by either party (the "Term").
5. NON-DISCLOSURES AND WORK FOR HIRE
"Confidential Information" shall mean any facts, opinions, conclusions,
projections, data, programs, processes, algorithms, ideas, concepts,
information, trade secrets or know-how, business projections, market studies,
client lists or documents containing same, whether legally protected from
disclosure or not, relating to any research project, work in progress, future
development, engineering, current development, programming, manufacturing,
marketing, financial or personnel matters relating to Cirilium, its present or
future products, projects, technologies, sales, Cirilium's, investors,
prospects, markets or businesses, whether communicated orally or in writing or
obtained by Contractor through observation or examination of Cirilium 's
facilities, businesses, trade secrets or procedures, existing as of the
Effective Date or thereafter developed in which there is a proprietary interest
and that there is a legitimate business reason for guarding against unauthorized
use or disclosure.
"Trade Secrets" shall mean any information or thing that constitutes a trade
secret under Federal, State, and/or local law, including, without limitation, a
formula, pattern, compilation, algorithm, program, device, method, technique,
process, or information related thereto, that: (i) derives independent economic
value, actual or potential, from not being generally known to the public or to
other persons who can obtain economic value from its disclosure or use; and (ii)
is the subject of efforts that are reasonable under the circumstances to
maintain its secrecy. Contractor acknowledges that Cirilium would suffer
irreparable injury and damage from disclosure of its confidential and trade
secret information. Contractor therefore covenants to hold such information in
the strictest of confidence, to use all reasonable precautions to safeguard the
information and not to use any confidential or trade secret information for
business purposes other than those of Cirilium. Contractor agrees to hold the
confidential and trade secret information of Cirilium in the strictest of
confidence indefinitely, to ensure that such information is not used by third
parties for any improper purpose and to indemnify Cirilium against any loss or
damage arising from unauthorized use directly or indirectly resulting from its
improper disclosure. Contractor covenants that Cirilium is entitled to an
5
injunction of any actions in violation of this Covenant, as well as damages, for
a breach of this confidentiality covenant. All work produced and all notes and
documentation provided by Contractor hereunder which are conceived or made in
response to matters related to the Services or based in whole or in part on or
derived from information supplied by Cirilium or its affiliated companies,
whether preliminary or final, and on whatever media rendered (collectively "Work
Product") shall be the exclusive property of Cirilium. Title to all Work Product
shall remain in Cirilium and Cirilium shall have the unlimited right to make,
have made, use, reconstruct, repair, modify, reproduce, publish, distribute, and
sell the Work Product, in whole or in part, or combine the Work Product with
other matter, or not use the Work Product at all, as it sees fit. Title to all
materials and documentation furnished by Cirilium to the Contractor or by the
Contractor to Cirilium shall remain in Cirilium. The Contractor shall deliver to
Cirilium any and all such materials and documentation including all copies
thereof on whatever media rendered, upon (i) Cirilium's request or (ii) the
termination of this Agreement for any reason.
6. WARRANTIES
Neither the execution, delivery, nor performance of this Agreement, with or
without the giving of notice, the passage of time, or both, will result in the
violation or breach of any contract, agreement, instrument, undertaking, order,
judgment, decree, rule, regulation, law, or any other restriction to which
Contractor is a party. Contractor warrants to Cirilium that (i) Contractor shall
perform all Services in a workmanlike and professional manner and, (ii)
Contractor has the legal right to perform all Services provided hereunder. All
of the intellectual property used by Contractor in connection with this
Agreement shall be of original development or licensable by Contractor, as the
case may be, and all of the intellectual property used by Contractor in
connection with this Agreement shall not infringe or violate any patent,
copyright, trade secret, trademark, or other third party intellectual property
right.
7. INDEMNIFICATION
Contractor shall defend, indemnify, and hold Cirilium, and any and all
subsidiaries of Cirilium, and their respective directors, officers, employees,
and agents ("Indemnified Parties"), harmless from and against any and all
claims, losses, damages, judgments, costs, and expenses (including attorney's
fees) which the Indemnified Parties may suffer or incur arising out of or in
connection with the provision of the Services by the Contractor. If any third
party claims or asserts in any suit, action, or proceeding that Cirilium or any
Cirilium affiliate's use of any Contractor tools, Work Product, equipment,
computer hardware, software and ancillary equipment of the Contractor or any
portion thereof infringes or violates any patent, copyright, trademark, trade
secret, or other third party proprietary right, Cirilium shall promptly notify
Contractor thereof and Contractor shall, at its own expense, defend such action
and indemnify and hold harmless Cirilium from and against any and all claims,
losses, damages, judgments, costs, and expenses (including attorney's fees)
arising therefrom or caused thereby. Contractor shall permit Cirilium to
participate in such defense to the extent that, in Cirilium's judgment, Cirilium
may be prejudiced thereby, and the Contractor shall not settle any such action
without the prior, written consent of Cirilium, which consent shall not be
unreasonably withheld. If Cirilium or the Contractor is enjoined from using the
Contractor tools, equipment computer hardware, software and ancillary equipment
or any portion thereof, Contractor shall promptly, at its expense, either: (i)
procure for Cirilium the right to use the Contractor tools, equipment, computer
hardware, software and ancillary equipment or portion thereof, the use of which
6
is enjoined; or (ii) modify the same so that it is no longer infringing, but
performs the same functions in an equivalent manner. If, despite exercising its
best efforts, Contractor is unable to accomplish one of the foregoing measures,
Cirilium may immediately terminate this Agreement effective upon written notice
to Contractor, reserving cumulatively all other rights and remedies available at
law and in equity. The Contractor and Lees, jointly and severally, agree to
protect, indemnify, defend, and hold harmless Cirilium from and against any and
all costs, claims, demands, damages, fines, interest, losses, liabilities,
penalties, and the like (including attorneys' fees and costs) arising from or in
any way related to this Agreement, and particularly in regard to the Contractor
and or Lees' status as an independent contractor, as provided for in Sections
3.3.4, 3.3.4.1, 8, and 9 herein.
8. INDEPENDENT CONTRACTOR STATUS
It is the understanding of the parties that this Agreement creates an
independent contractor agreement and not an employment agreement. It is the
intention of the parties that the Contractor shall be an independent contractor
and not an employee of Cirilium for all purposes, including, but not limited to,
the application of any federal or state law relating to employment or tax
liability. It is the further understanding of the Parties that Contractor will
not be eligible to participate in any of the employee benefit plans and programs
offered by Cirilium to its employees only. Contractor acknowledges that the
compensation specified in this Agreement constitutes all of the compensation to
which Contractor is entitled for the rendition of services to Cirilium, and that
Contractor will not be entitled to vacation or sick pay or any benefits under
Cirilium's pension, profit sharing, health, disability, life insurance,
severance, or any other plan or program of employee benefits provided by
Cirilium to its employees.
9. STATE AND FEDERAL TAXES
Contractor shall be responsible for the withholding and payment of any required
state and federal payroll taxes, including income, FICA, FUTA, and state
unemployment for any assistants or employees retained by Contractor, including
if applicable, Lees. Cirilium shall not be required to make any payroll
withholdings with respect to its payments under this Agreement.
10. EQUAL EMPLOYMENT OPPORTUNITY
Contractor warrants and represents that it is an equal opportunity employer.
Contractor does not discriminate on the basis of race, religion, age, sex,
marital status, sexual orientation, veteran status, medical condition, physical
handicap or disability, or any other legally protected classification, except as
may be permitted by law. Contractor agrees to comply with all applicable
provisions of Executive Order 11246 of September 24, 1965, the Vocational
Rehabilitation Act of 1973, and the Vietnam Era Veterans Readjustment Assistance
Act of 1974, as well as all applicable non-discrimination provisions of state
and local law.
7
11. MISCELLANEOUS
11.1 This Agreement constitutes the entire Agreement between the Parties
hereto with respect to the subject matter hereof and supersedes all
prior agreements, understandings and arrangements, both oral and
written, between the parties hereto with respect to such subject
matter. This Agreement amends and restates in its entirety that
certain First Consulting Agreement dated as of April 1, 2004 among
Cirilium and the Contractor, as supplemented or amended hereby. This
Agreement further amends and restates in its entirety that certain
Employment Agreement dated as of April 1, 2004 among Cirilium and
Lees, as supplemented or amended hereby. This Agreement may not be
modified except by a writing signed by each Party hereto.
11.2 Any notices required or permitted to be given under this Agreement
shall be in writing and shall be deemed to have been duly given when
delivered by hand or when deposited in the United States mail, by
certified mail, return receipt requested, postage prepaid, as
follow:
If to Cirilium: Cirilium Holdings, Inc.
000 X. Xxxxxxx Xxxxx
Xxxxx 000
Xxxx Xxxx Xxxxx, XX 00000
Attn: Legal Department
If to the Contractor: _________________________
_________________________
_________________________
If to Lees: _________________________
_________________________
_________________________
11.3 The determination jointly by the parties hereto or by a Court as to
the invalidity, unenforceability or unreasonableness of any
provision hereof shall in no way affect the validity or
enforceability of any other provision, and the invalid,
unenforceable or unreasonable provision shall be modified to be
valid and enforceable to the full extent permitted by law.
11.4 The waiver by either Party hereto of a breach or violation of any
term or provision of this Agreement shall not operate or be
construed as a waiver of any subsequent breach or violation.
11.5 The Parties agree that any action brought pursuant to the terms and
conditions of this Agreement shall be brought within the exclusive
jurisdiction of Palm Beach County, Florida, and that this Agreement
shall be construed in accordance with the Laws of the State of
Florida without giving affect to the principles of Conflicts of Law.
8
11.6 Except as provided otherwise herein, no Party shall be eligible for
any attorneys' fees and or court costs or expenses of any kind or
manner.
IN WITNESS WHEREOF the Parties have executed this Agreement on the date
set forth above. .
Cirilium Holdings, Inc.
By: /s/ Xxxxxx X. Xxxxxx
---------------------------
Name: Xxxxxx X. Xxxxxx
Title: President
LeeWard Enterprises CTI, Inc.
By: /s/ Xxxxxx X. Xxxx
---------------------------
Name: Xxxxxx X. Xxxx
Title: President
Xxxxxx X. Xxxx
/s/ Xxxxxx X. Xxxx
---------------------------
Xxxxxx X. Xxxx
9
