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0000 XXXXXXX XXXXX XXXXX 000
XXXXXXXX XXXXXXX, XX. 00000
EMPLOYMENT AGREEMENT
Employment Agreement made effective as of the date of signing, by and between
XxxxxxXxxxxxxx.xxx a Nevada Corporation, with principal offices in Colorado
Springs, Colorado ("Company"), and Xxxx X. Xxxxxxxxx, residing in, Boca Raton,
Florida ("Employee"). In consideration of the promises and mutual covenants
herein set forth, the Company and the Employee agree as follows:
ARTICLE 1: EMPLOYMENT TERMS
SECTION 1.1. EMPLOYMENT AND TERM. The Company hereby employs the Employee, and
the Employee accepts such employment, upon the terms and conditions hereinafter
set forth, for the period ("Employment Term") commencing on and as of the date
of this contract signing hereunder and terminating as provided in Section 1.7
hereof.
SECTION 1.2. EMPLOYMENT SERVICES. The Employee shall devote his full working
time and effort to promote the business and affairs of the Company and its
Affiliates as necessary in order to enable them to achieve their business
objectives. The Employee's principal assignment shall be to serve as President
and Chief Executive Officer. In this capacity as an executive of the company,
the Employee shall be responsible for and shall also perform other duties and
assignments, which are consistent with his responsibilities, which may be
reasonably assigned to him from time to time by the Board of Directors of the
Company. Nothing in this Section 1.2 shall be deemed to prevent the Employee
from:
A. Investing his assets in a manner not prohibited by Section 2.5 hereof, and
in such form or manner as shall not require any material services on his
part in the operations or affairs of the companies or other entities in
which such investments are made;
B. Serving on the board of directors of any other company, subject to the
prohibitions set forth in Section 2.5 hereof, provided the Board of
Directors of the Company shall have approved such service in writing, or;
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C. Engaging in religious, charitable or other community or non-profit
activities, which do not impair his ability to fulfill his duties and
responsibilities under this Agreement.
SECTION 1.3. EMPLOYMENT COMPENSATION.
A. BASE SALARY - For services rendered by the Employee under this
Agreement, the Company shall pay the Employee an initial annual salary
of $200,000.00 per annum, payable in equal semi-monthly installments
(the "Base Salary"). The Base Salary shall be subject to annual review
by the Board of Directors of the Company on or about each January 1
thereafter for so long as this Agreement is in effect.
B. INCENTIVE BONUS COMPENSATION - For services rendered by the Employee
under this Agreement, the Company, by action of the Board of Directors,
shall establish an annual executive incentive bonus plan in which the
Employee shall participate in recognition of the Employee's
contribution to the overall performance of the Company ("Bonus"). Such
Bonus shall be granted within ninety (90) days following the conclusion
of each calendar year commencing December 31, 1999, after assessment of
the Employee's and Company's performance pursuant to the criteria,
terms and conditions of the bonus plan to be established. The amount of
any Bonus, which the Company may grant to the Employee from time to
time shall be in addition to his Base Salary and shall, under no
circumstances, be included in the Employee's Base Salary.
C. STOCK OPTIONS - The Employee shall be entitled to participate in The
Company's Stock Option Plan ("Option Plan"). Grants under the Option
Plan shall be in amounts determined by the Option Plan administrators
or Board of Directors of the Company. The initial amount of stock,
which has been granted to the Employee under the Company Stock Option
Plan, vesting in equal amounts at the conclusion of each of the
subsequent (3) three years, beginning June 1, 1999, is 2,000,000 shares
for founding the company.
SECTION 1.4. BENEFITS. The Employee will participate in any employee benefit
programs provided by the Company and its Subsidiaries, if any.
SECTION 1.5. WITHHOLDING. The amount of payments to be made by the Company to
the Employee are set forth herein prior to the deduction of any taxes or other
amounts, and all such payments shall be made by the Company to the Employee
under this Agreement net of any tax or other amounts required to be withheld by
the Company under applicable law.
SECTION 1.6. VACATION. The Employee shall be entitled to vacation and holiday
plans under the same terms and considerations, as they are available to all
Company employees, in accordance with Company policy.
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SECTION 1.7. EMPLOYMENT TERM; TERMINATION The Employment Term shall run
indefinitely, unless terminated pursuant to the following provisions of this
Section 1.7.
A. "THE EMPLOYMENT TERM" shall terminate:
1. At the death or 60 days after the Permanent Disability (as hereinafter
defined) of the Employee 2. Immediately at the election of the Company, for
Cause (as hereinafter defined), or; 3. At the election of either the Company or
the Employee upon fifteen (15) days' prior written notice to the other.
B. "PERMANENT DISABILITY", for purposes of this Section 1.7, shall mean
any physical or mental incapacitation which would materially hinder the
Employee from performing the responsibilities of his assigned duties,
as determined by a medical professional of the company's choosing.
C. "CAUSE", for purposes of this Section 1.7, shall mean any of the
following, as determined by the management of The Company:
1. Refusal of the Employee to perform his duties hereunder or other
material breach by the Employee of the terms of this Agreement;
2. Any substantial dishonesty by the Employee in connection with the
performance of his duties hereunder; or
3. Any conviction of, or plea of guilty by, the Employee with respect to
any crime, which conviction or plea is likely in the reasonable
judgment of the management of the Company to adversely affect the
Employee's professional reputation, the reputation of the Company or
of any other member of the Group or the ability of the Employee to
perform his duties satisfactorily hereunder.
4. The Company's right of termination pursuant to this Section 1.7 shall
be in addition to, and shall not affect, its rights and remedies under
any other provisions of this Agreement or under applicable law, and
all such rights and remedies shall survive termination of this
Agreement and the employment of the Employee hereunder. Nothing herein
shall be deemed to constitute a waiver by the Employee of any rights
he may have under applicable laws.
5. In the event of termination of employment pursuant to the terms of
this Section 1.7, the Employee shall have no right to receive any
compensation or fees for any period subsequent to the date of such
termination; except that:
6. In the event such termination is due to death or Permanent Disability
pursuant to Section 1.7 (B), the Company shall pay the Employee or his
estate, as the case may be, a pro tanto portion of the Bonus, if any,
for the year in which such termination occurs, a special 90 ninety day
bonus severance, and vesting of the current year's stock options;
7. In the event that such termination is made by the Company pursuant to
Section 1.7 (B) hereof, the Company agrees that during the Severance
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Period (as such term is defined below) it will continue to pay the
Employee his then current Base Salary.
D. "SEVERANCE PERIOD", for purposes of this Section 1.7, shall mean the period
commencing on the date of such termination and ending: fifteen (15)
calendar days thereafter.
E. "THE OBLIGATIONS" of the Employee pursuant to Sections 2.3 and 2.4 of this
Agreement shall survive the termination for any reason of the Employment
Term. The obligations of the Employee pursuant to Section 2.5 hereof shall
survive the termination of this Agreement as provided for in Section 2.5.
1.7.1 COMPANY CHANGE OF CONTROL. Notwithstanding any provisions contained in
this Plan or in a Stock Option Agreement deferring the right of employee to
exercise an option, the option (referred to in 1.3.C above) shall, at the
discretion of the Board, become fully vested and employee shall be entitled to
exercise such option, in whole or in part, during the 30-day period following
the first purchase of Shares of the Company pursuant to a tender offer or
exchange offer (other than an offer by the Company) for all, or any part of, the
Company's Shares or; A. Commencing on the date of approval by the shareholders
of the Company of an agreement for:
1. A merger or consolidation or similar transaction in which the Company
will not survive as an independent corporation,or
2. A sale, exchange or other disposition of all or more than 75% all of the
Company's assets.
ARTICLE 2: GENERAL PROVISIONS
SECTION 2.1. EXPENSE ACCOUNT AND ALLOWANCE. The Company agrees to reimburse the
Employee for all reasonable travel, entertainment and other documented, itemized
business expenses incurred by him in connection with the performance of his
duties under this Agreement; provided, however, that the amount available for
such travel, entertainment, and other business expenses shall be consistent with
expense reimbursement policies adopted by the Company as in effect at the time
of the incidence of such expenses by the Employee or as may be fixed in advance
by the Company's Board of Directors.
SECTION 2.2. LOCATION. The Employee shall perform services under this Agreement
at the Employee's private office and at such other location or locations
reasonably specified by the Company. The Employee shall also make himself
available to make reasonable business trips at the Company's expense, both
within and outside the United States of America, for purposes of consulting with
customers, agents, representatives and suppliers of the Company and its
Affiliates, as well as with other members of the Company's management.
SECTION 2.3. CONFIDENTIAL INFORMATION Sensitive Company data and information is
the property of the Company, and must be protected:
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A. The Employee hereby agrees to hold and maintain confidential and
private all papers, plans, drawings, specifications, methods,
processes, techniques, shop practices, formulae, customer lists,
personnel and financial data, plans, trade secrets and all proprietary
information belonging to the Company or any Affiliate thereof of which
the Employee may have knowledge or acquire knowledge whether prior to,
during or after the termination of the Employment Term, and to
maintain as confidential and secret any new processes, formulations,
designs, devices, research data, machines or compositions of matter of
the Company or of any of its Affiliates or of any persons granting
rights to the Company or any of its Affiliates revealed to the
Employee or discovered, originated, made or conceived by the Employee
in connection with the furnishing of employment and consulting
services to the Company or any of its Affiliates.
B. The Employee hereby agrees that he shall not at any time, either
during or subsequent to the Employment Term, disclose or divulge to
any person, other than to the Company's or any of its Affiliates'
officers and other employees as required by the Employee's duties
under this Agreement and to third parties when required in the
ordinary course of business of the Company, any of the information
specified in Section 2.4(a) above or any trade or business secrets or
any other confidential information belonging to the Company or any of
its Affiliates of which the Employee may have or acquire knowledge.
Notwithstanding anything to the contrary set forth above, the
confidentiality and nondisclosure provisions contained in this Section
2.4 shall not apply to any information or data, if and when such
information or data becomes a matter of public knowledge through no
act or omission of the Employee or to any information or data which
was already known by the Employee or the other party in question other
than as a result of a breach of this Agreement.
C. Immediately upon the Company's request or promptly upon termination
for any reason or expiration of this Agreement, the Employee shall
deliver to the Company all memoranda, notes, records, reports,
photographs, drawings, plans, papers or other documents made or
compiled by the Employee in the course of his services to the Company
or any of its Affiliates or made available to the Employee during the
course of his services to the Company or any of its Affiliates which
are in the possession of or under the control of the Employee, and any
copies or abstracts thereof, whether or not of a secret or
confidential nature, and all of such memoranda or other documents
shall, during and after the termination of the Employment Term, be
deemed to be and shall be the property of the Company.
SECTION 2.4. INTELLECTUAL PROPERTY. Intellectual property is the property of
the Company, and must be protected:
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A. Any and all inventions, improvements, ideas and innovations, whether
or not patentable, which the Employee may invent, discover, originate,
make or conceive during his services to the Company or any of its
Affiliates, whether prior to or during the Employment Term, either
solely or jointly with others, and which in any way relate to or are
or may be used in connection with the business of the Company or any
of its Affiliates shall be, to the extent of the Employee's interest
therein, the sole and exclusive property of the Company or such
Affiliate and the Employee's interest therein shall be assigned by the
Employee to the Company or such Affiliate, as the case may be, or to
the Company's or such Affiliate's nominee(s). The Employee, upon the
request and at the expense of the Company, shall and shall use his
best efforts to cause any such other person(s) to promptly and fully
disclose each and all such discoveries, inventions, improvements,
ideas or innovations to the Company, the applicable Affiliate or any
nominee(s) thereof. Further, the Employee, upon the request and at the
expense of the Company, shall and shall use his best efforts to cause
any such other person(s) to, assign to the Company or the applicable
Affiliate, without further compensation therefore, all right, title
and interest in and to each and all such discoveries, inventions,
improvements, ideas or innovations which are reduced to writings,
drawings or practice within two (2) years after the termination of the
Employment Term.
B. The Employee further agrees to execute at any time, upon the request
and at the expense of the Company, for the benefit of the Company, any
of its Affiliates or any nominee(s) thereof, any and all appropriate
applications, instruments, assignments and other documents, which the
Company shall deem necessary or desirable to protect its (or any of
its Affiliate's) entire right, title and interest in and to any of the
discoveries, inventions, improvements, ideas and innovations described
in Section 2.5(a) hereof:
C. The Employee agrees, upon the request and at the expense of the
Company or any person to whom the Company or any of its Affiliates may
have granted or grants rights, to execute any and all appropriate
applications, assignments, instruments and papers, which the Company
shall deem necessary for the procurement in the United States of
America and foreign countries of patent protection for the
discoveries, inventions, improvements, ideas or innovations to be so
assigned, including the execution of new, provisional, continuing and
reissue applications, to make all rightful oaths, to testify in any
proceeding before any governmental authority authorized to grant or
administer patent protection or before any court, and generally to do
everything lawfully possible to aid the Company, its Affiliates and
its and their successors, assigns and nominees to obtain, enjoy and
enforce proper patent protection for the discoveries, inventions,
improvements, ideas or innovations conceived or made by him during the
course of his services to the Company or any of its Affiliates for a
period of two (2) years after the termination of the Employment Term.
SECTION 2.5. NON-COMPETITION. The Company and the Employee acknowledge that the
Company and its Affiliates conduct business throughout the world and the
engagement by the Employee in the Internet Gaming Industry anywhere in the
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Xxxxxx Xxxxxx xx Xxxxxxx xx Xxxxxx could cause the Company irreparable harm. For
the period commencing on the date hereof and ending two (2) years after the
termination of the Employment Term (the "Restricted Period"), the Employee shall
not:
A. Except as an officer and director of the Company and its Affiliates,
utilize intellectual property or trade secrets, gained from the
Company, which is an asset of the Company, to engage at any place
within the United States of America or Canada in any business
substantially similar to the business then being conducted by the
Company or its Affiliates (the "Designated Industry"), whether directly
or indirectly, for his own account or as an employee, partner, officer,
director, consultant or holder of more than five percent (5%) of the
equity interest in any other person, firm, partnership or corporation
B. Divert to any competitor of the Company or its Affiliates any customer
of the Company or its Affiliates, or
C. Solicit or encourage any officer, key employee or consultant of the
Company or its Affiliates to leave its or their employ for alternative
employment in the Designated Industry, or hire or offer for employment
to any person to whom the Company or any of its Affiliates has offered
employment within the three (3) years preceding the termination of the
Employment Term. The Employee will continue to be bound by the terms of
this Section 2.5 until their expiration and shall not be entitled to
any compensation with respect thereto.
SECTION 2.6. SEVERABILITY. If any provision of this Agreement shall, in whole or
in part, prove to be invalid for any reason, such invalidity shall affect only
the portion of such provision which shall be invalid, and in all other respects
this Agreement shall stand as if such invalid provision, or other invalid
portion thereof, had not been a part hereof. Without limiting the generality of
the preceding sentence, if any provision of Section 2.6 hereof shall be held to
be invalid or unenforceable under any applicable law, as unreasonably
restrictive in duration or geographical area or otherwise, it is the intention
of the parties hereto that such provision shall be deemed to be immediately
amended to provide for such maximum restriction as shall be determined to be
reasonable and enforceable by the court or other body having jurisdiction; and
the Company and the Employee expressly agree that such provision, as so amended,
shall be valid and binding.
SECTION 2.7. EQUITABLE REMEDIES. Each of the parties hereto acknowledges and
agrees that upon any breach by the Employee of his obligations under Section
2.3, 2.4 or 2.5 hereof, the Company will have no adequate remedy at law, and
accordingly will be entitled to specific performance and other appropriate
injunctive and equitable relief.
SECTION 2.8. ASSIGNMENT. The rights and obligations of the Company under this
Agreement shall inure to the benefit of and shall be binding upon the successors
and assigns of the Company, provided that neither this Agreement nor the rights
and obligations of the Company under this Agreement may be assigned by the
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Company other than to an Affiliate of the Company. The Employee may not assign
to any other person his rights and/or obligations under this Agreement.
SECTION 2.9. AMENDMENT. This Agreement and any term, covenant, condition or
other provision hereof may be changed, waived, discharged or terminated solely
by an instrument in writing signed by the parties hereto.
SECTION 2.10. WAIVER OF BREACH. The waiver by the Company of a breach of any
provision of this Agreement by the Employee shall not operate or be construed as
a waiver of any other breach by the Employee.
SECTION 2.11. NOTICES. All notices, requests, demands, consents and other
communications in connection with this Agreement shall be in writing or by
written telecommunication and shall be delivered personally or mailed as
follows: by registered or certified mail or by overnight courier, postage
prepaid, or sent by written telecommunication as follows:
If to the Company:
XxxxxxxXxxxxxxx.xxx
Xxxxxxxx Xxxxxxx, XX. 00000
If to the Employee:
Xxxxx Xxxxxxx
Boca Raton, Florida
or, at such other address as the parties hereto may from time to time designate
in writing.
SECTION 2.12. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of Nevada.
SECTION 2.13. ARBITRATION OF DISPUTES. Any controversy or claim arising out of
or relating to this Agreement or the breach thereof shall be settled by
arbitration in accordance with the laws of Nevada by two arbitrators, one of
whom shall be appointed by the Company, one of whom shall be appointed by the
Employee and if agreement cannot be reached, by a third arbitrator which shall
be appointed by agreement of the first two arbitrators. Such arbitration shall
be conducted in Nevada in accordance with the rules of the prevailing
Arbitration Association, except with respect to the selection of arbitrators
which shall be as provided in this Section 2.13. Judgment upon the award
rendered by the arbitrators may be entered in any court having jurisdiction
thereof. All fees and expenses of the arbitration process shall be borne equally
by the parties hereto regardless of the final outcome, unless and to the extent
the arbitrators shall determine that under the circumstances the sharing of all
or a part of any such fees and expenses would be unjust.
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SECTION 2.14. ENTIRE AGREEMENT. This Agreement embodies the entire agreement
between the Company and the Employee relating to the subject matter hereof, and,
except as otherwise expressly provided herein, this Agreement shall not be
affected by reference to any other document.
SECTION 2.15. HEADINGS, ETC. The headings of the sections of this Agreement have
been inserted for convenience of reference only and shall not be deemed to be a
part of this Agreement.
SECTION 2.16. COUNTERPARTS. This Agreement may be executed in several identical
counterparts, each of which when executed by the parties hereto and delivered
shall be an original, but all of which together shall constitute a single
instrument. In making proof of this Agreement, it shall not be necessary to
produce or account for more than one such counterpart.
SECTION 2.17. ADDITIONAL DEFINED TERMS:
A. "AFFILIATE" means any person, corporation or other business entity that
directly or indirectly controls, or is controlled by, or is under
common control with another person, corporation or business entity.
B. "SUBSIDIARY" means any corporation fifty percent (50%) or more of the
capital stock of which having ordinary voting power for the election of
directors is owned directly or indirectly by another corporation or
business entity.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of this written
date: May 22, 1999.
ACCEPTED AND AGREED TO:
Employee Signature [GRAPHIC OMITTED][GRAPHIC OMITTED]
EMPLOYEE NAME XXXX X. XXXXXXXXX SOCIAL SECURITY #
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Company Officer Signature _________________________________________
Company Officer Name Xxxxxx Xxxxxxx Secretary
