Exhibit 2.6
EMPLOYMENT AGREEMENT
AGREEMENT dated as of January 25, 2002, between GENESIS FUNDING, INC.
("Genesis"), a Washington corporation, having its principal place of business at
000 Xxxxx Xxxxxx Xxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxxxx 00000, and Xxxxxxx X.
Xxxx, an individual residing in Spokane, Washington ("Xxxx").
WITNESSETH:
WHEREAS, Genesis, has executed documents relating to an investment in
GENESIS by Temporary Financial Services, Inc. ("TFS"), Xxxx X. Xxxxxxx, Xxxxxxx
X. Xxxx, and Xxxxxxx X Xxxx (the "Investors").
WHEREAS, Xxxx is acknowledged as a capable and qualified executive in the
financial services business that Genesis will be engaged in;
WHEREAS, the parties acknowledge that Xxxx'x abilities and services are
unique and essential to the prospects of Genesis and the Investors have invested
in Genesis in reliance on Xxxx'x continuing services to Genesis pursuant to this
Agreement; and
WHEREAS, in light of the foregoing, Genesis desires to employ Xxxx as its
President and Xxxx desires to accept such employment.
NOW, THEREFORE, the parties hereto agree as follows:
1. Employment. Genesis hereby employs Xxxx and Xxxx hereby accepts employment
upon the terms and conditions hereinafter set forth.
2. Term. This Agreement shall commence on the date hereof and shall terminate
as of the earlier of:
(a) Two years from the date hereof (the "Initial Term") unless either Xxxx
or Genesis notifies the other that he or it elects to extend the term
hereof for an additional one year (the "Renewal Period"), such notice
to be given within 90 days before the end of the Initial Term hereof
or within 90 days before the end of each successive Renewal Period;
(b) The death of Xxxx;
(c) Unless cured by Xxxx within the thirty day period, thirty days after
notice is given by Genesis to Xxxx of a material breach hereof by
Xxxx; or
(d) Unless cured by Genesis within the thirty day period, thirty days
after notice is given by Xxxx to Genesis, of a material breach hereof
by Genesis.
The exercise of the right of Genesis or Xxxx to terminate this Agreement
pursuant to clause (c) or (d) hereof, as the case may be, shall not
abrogate the rights and remedies of the terminating party in respect of the
breach giving rise to such termination. Genesis shall only be deemed to
have materially breached this Agreement and the terms of Xxxx'x employment
if it fails to pay compensation as required under Section 3 or if it
reassigns Xxxx to a position other than senior executive as required
Section 4.
3. Compensation. For all services rendered under this Agreement:
(a) Base Salary. Genesis shall pay Xxxx a base salary of $72,000 per annum
in equal monthly or semi-monthly installments. The Board of Directors
will review, at least annually, Xxxx'x compensation with a view to
increasing it if, in the sole judgment of the Board of Directors, the
earnings of Genesis or the services of Xxxx merit such an increase.
(b) During the Initial Term, Xxxx shall also receive, at the discretion of
the Board of Directors, incentive compensation in amounts and at the
times set by the Board. Incentive compensation payable under this
subparagraph is intended to reward exemplary performance.
(c) During the term of his employment, Xxxx shall be entitled to
participate in employee benefit plans or programs of Genesis, if any,
to the extent that his position, tenure, salary, age, health and other
qualifications make him eligible to participate, subject to the rules
and regulations applicable thereto. Such additional benefits shall
include, subject to the approval of the Board of Directors, full
medical, three weeks paid vacation, and qualified pension and profit
sharing plans.
(d) Xxxx shall be entitled to reimbursement of all expenses incurred by
him in the performance of his duties, subject to the presenting of
appropriate vouchers in accordance with Genesis's policy.
4. Duties. Xxxx is engaged initially with the title and functions of President
of Genesis and, subject to the direction of the Board of Directors, shall
perform and discharge well and faithfully the duties which may be assigned
to him from time to time by Genesis in connection with the conduct of its
business. Nothing herein shall preclude the Board of Directors of Genesis
from changing Xxxx'x title and duties if the Board has concluded in its
reasonable judgment that such change is in Genesis's best interests;
provided, however, that at all times during the term of this Agreement,
Xxxx shall be employed as a senior Executive of Genesis with appropriate
and commensurate compensation, title, rank and status. If Xxxx is elected
or appointed a director or officer of Genesis or any subsidiary thereof
during the term of this Agreement, Xxxx will serve in such capacity without
further compensation.
5. Extent of Services. Xxxx shall devote his entire time, attention and
energies to the business of Genesis, and shall not, during the term of this
Agreement be engaged in any other business or professional activity,
without the permission of Genesis. Xxxx is specifically prohibited, during
the term of this agreement from providing services to any competitor of
Genesis. This prohibition shall not be construed as preventing Xxxx from
(a) investing his personal assets in businesses which do not compete with
Genesis, (b) purchasing securities in any corporation whose securities are
regularly traded provided that such purchase shall not result in his
collectively owning beneficially at any time five percent or more of the
equity securities of any corporation engaged in a business competitive to
that of Genesis, and (c) participating in conferences, preparing or
publishing papers or books or teaching so long as the Board of Directors
approves of such activities prior to Xxxx'x engaging in them. Prior to
commencing any activity described in clause (c) above, Xxxx shall inform
the Board of Directors of Genesis in writing of any such activity.
6. Disclosure of Information.
(a) Xxxx represents and warrants to Genesis that his resume included in
the Genesis Funding Business Plan sets forth all material information
about Xxxx'x background. Xxxx further represents that he is not
subject to any covenants not to compete.
(b) Xxxx recognizes and acknowledges that Genesis's trade secrets and
proprietary information and processes, as they may exist from time to
time, are valuable, special and unique assets of Genesis's business,
access to and knowledge of which are essential to the performance of
Xxxx'x duties hereunder. Xxxx will not, during or after the term of
his employment by Genesis, in whole or in part, disclose such secrets,
information or processes to any person, firm, corporation, association
or other entity for any reason or purpose whatsoever, nor shall Xxxx
make use of any such property for his own purposes or for the benefit
of any person, firm, corporation or other entity (except Genesis)
under any circumstances during or after the term of his employment,
provided that after the term of his employment these restrictions
shall not apply to such secrets, information and processes which are
then in the public domain (provided that Xxxx was not responsible,
directly or indirectly, for such secrets, information or processes
entering the public domain without Genesis's consent). Xxxx agrees to
hold as Genesis's property, all memoranda, books, papers, letters,
formulas and other data, and all copies thereof and therefrom, in any
way relating to Genesis's business and affairs, whether made by him or
otherwise coming into his possession, and on termination of his
employment, or on demand of Genesis, at any time, to deliver the same
to Genesis.
7. Inventions. Xxxx hereby sells, transfers and assigns to Genesis or to any
person, or entity designated by Genesis, the entire right, title and
interest of Xxxx in and to all inventions, ideas, disclosures and
improvements, whether patented or unpatented, and copyrightable material,
made or conceived by Xxxx, solely or jointly, or in whole or in part,
during the term of this Agreement which (i) relate to methods, apparatus,
designs, products, processes or devices sold, leased, or used by Genesis or
any subsidiary or (ii) otherwise relate to or pertain to the business,
functions or operations of Genesis or any subsidiary. Xxxx shall
communicate promptly and disclose to Genesis, in such form as Genesis
requests, all information, details and data pertaining to the
aforementioned inventions, ideas, disclosures and improvements; and,
whether during the term hereof or thereafter, Xxxx shall execute and
deliver to Genesis such formal transfers and assignments and such other
papers and documents as may be required of Xxxx to permit Genesis or any
person or entity designated by Genesis to file and prosecute the patent
applications and, as to copyrightable material, to obtain copyright
thereon. Any invention by Xxxx, relating to the business of Genesis, within
one year following the termination of this Agreement shall be deemed to
fall within the provisions of this paragraph unless proved by Xxxx to have
been first conceived and made following such termination.
8. Covenant Not to Compete.
(a) During the term hereof and, unless this Agreement is terminated
pursuant to Section 2(d) hereof, for a period of two years thereafter,
Xxxx shall not compete, directly or indirectly, with Genesis,
interfere with, disrupt or attempt to disrupt the relationship,
contractual or otherwise, between Genesis and any customer, client,
supplier, consultant or employee of Genesis, including, without
limitation, employing or being an investor (representing more than a
5% equity interest) in, or officer, director or consultant to, any
person or entity which employs any former key or technical employee
whose employment with Genesis was terminated after the date which is
one year prior to the date of termination of Xxxx'x employment
therewith. An activity competitive with an activity engaged in by
Genesis shall include becoming an employee, officer, consultant or
director of, or being an investor in, or owner of, an entity or person
engaged in the business then engaged in by Genesis.
(b) It is the desire and intent of the parties that the provisions of this
Section 8 shall be enforced to the fullest extent permissible under
the laws and public policies applied in each jurisdiction in which
enforcement is sought. Accordingly, if any particular portion of this
Section 8 shall be adjudicated to be invalid or unenforceable, this
Section 8 shall be deemed amended to delete or modify the offending
portion to the extent required to make this Section 8 enforceable in
the particular jurisdiction in which such adjudication is made.
(c) Nothing in this Section 8 shall reduce or abrogate Xxxx'x obligations
during the term of this Agreement under Sections 4 and 5 hereof.
9. Remedies.
(a) The parties hereto acknowledge that the damages suffered by Genesis
and the Investors from Xxxx'x breach of this Agreement, by his
continued neglect of his duties in Section 4 or 5, may not be
ascertainable. Accordingly, if Xxxx breaches Section 4 or 5 hereof by
continuously neglecting his duties in either of said Sections, Genesis
and the Investors shall be entitled to the greater of actual proven
damages (determined by a court, or arbitrator) or liquidated damages
from Xxxx in the amount of $18,000.
(b) If there is a breach or threatened breach of the provisions of Section
5, 6(b), 7 or 8 of this Agreement, Genesis shall be entitled to an
injunction restraining Xxxx from such breach. Nothing herein shall be
construed as prohibiting Genesis from pursuing any other remedies for
such breach or threatened breach.
(c) If this Agreement is terminated pursuant to Section 2(d) hereof, Xxxx
is not required to mitigate damages otherwise obtainable from Genesis
as a result Genesis' breach and any income received by Xxxx after such
termination shall not reduce the amount of damages otherwise
obtainable from Genesis hereunder.
10. Insurance. Genesis may, at its election and for its benefit, insure Xxxx
against accidental loss or death and Xxxx shall submit to such physical
examination and supply such information as may be required in connection
therewith.
11. Assignment. This Agreement may not be assigned by Xxxx. Genesis may assign
this Agreement in connection with a merger or consolidation involving
Genesis or a sale of substantially all its assets to the surviving
corporation or purchaser, as the case may be, so long as such assignee
assumes Genesis's obligations under this Agreement.
12. Notices. Any notice required or permitted to be given under this Agreement
shall be sufficient if in writing and sent by registered mail to Xxxx at
his residence at _______________________
_____________________________________________or Genesis at its address set
forth above, Attention: The Board of Directors.
13. Waiver of Breach. A waiver by Genesis or Xxxx of a breach of any provision
of this Agreement by the other party shall not operate or be construed as a
waiver of any subsequent breach by the other party.
14. Entire Agreement. This instrument contains the entire agreement of the
parties. It may be changed only by an agreement in writing signed by a
party against whom enforcement of any waiver, change, modification,
extension or discharge is sought.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first hereinabove written.
Genesis Funding, Inc. Xxxx
/s/Xxxxxxx X. Xxxxxx /s/ Xxxxxxx X. Xxxx
Name: Xxxxxxx X. Xxxxxx Xxxxxxx X. Xxxx
Title: Chairman
