EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is entered into effective as of the 1st
day of April 2000, notwithstanding the later execution hereof, by
and between WebQuest International, Inc. a Nevada corporation
("Employer") and Xxxxx Xxxxx ("Employee").
WITNESSETH:
In consideration of the mutual promises herein contained, the
parties agree as follows:
1. Employment Agreement. The Employer hereby agrees to employ
Employee, and Employee hereby agrees to serve as such Employee
upon the terms and conditions hereinafter set forth.
2. Term of Employment. Subject to the provisions for termination
as hereinafter provided, the term of the employment shall
commence as of the date of this Agreement and shall end on
September 30, 2002. At the end of the term hereof, this Agreement
may be renewed by mutual agreement of the parties.
3. Employee's Position and Duties. Employee agrees as follows:
a. Employee shall assume responsibility, as directed by the
Board of Directors, Chief Executive Officer or President, as
Chief Financial Officer of Employer.
b. During the term of this Employment Agreement, Employee shall,
in good faith, devote his best efforts to his employment and
perform diligently and in good faith such duties as are or may
be from time to time required by the Employer, which duties
shall be consistent with his position as set forth above; it
being understood and acknowledged that, the terms "best
efforts" mean such effort and time commitment as is necessary to
achieve the success of the business.
c. Employee shall not, without the prior written consent of
Employer, directly or indirectly, during the term of this
Agreement, whether for compensation or otherwise, render
services of a business, professional or commercial nature to any
person or firm that is engaged in a business similar to that of
the Employer.
d. The parties agree that during the performance of this
Agreement Employee's principal place of residence shall be Reno,
NV and Employer shall not require Employee to change his
principal place of residence.
4. Compensation and Benefits. During the term of employment
hereunder, Employer shall compensate Employee as follows:
a. Wages. For all services he may render to Employer during
the term of this Agreement, employee shall receive from
Employer an hourly wage of $42.50 ($85,000 per year). Employee
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will be paid one-half in cash and one-half in common restricted
stock calculated at $1.00 per share. Stock will be issued
quarterly.
b. Stock Options. Employee has been granted a stock option to
purchase three hundred thousand shares of WebQuest International.
Inc. common stock at $2.81 per share. These options vest as
follows: 25,000 shares on January 19, 2000 and 25,000 shares
vesting quarterly starting on March 31, 2000. All stock options
have a life of three years from vesting date. Upon involuntary
termination or change of control, as defined in this agreement,
the remaining options will vest immediately.
5. Termination of Employment.
a. For Cause. The employment of Employee under this Employment
Agreement, and the term hereof, may be terminated by the Employer
only upon a showing of "Cause", upon thirty (30) days' written
notice to Employee. The "effective date of termination" shall be
the date thirty (30) days after written notice of termination is
delivered to the Employee. "Cause" is defined as follows:
i. A material act or omission in the course of Employee's
duties that is dishonest or fraudulent;
ii. A material breach of this Agreement by Employee.
iii. Employee is not performing his duties adequately as
ChieF Financial Officer, as determined by the Chief
Executive Officer, with input from the President.
b. Disability or Death. The employment of Employee under this
Employment Agreement and the term hereof, shall be terminated by
the death or partial or total disability of Employee. For
purposes hereof, the term "disability" is hereby defined to mean
any mental or physical disability that renders Employee unable
to perform his duties or assignment as determined by the Chief
Executive Officer of Employer, in the judgment and discretion of
said CEO, with input from the President. Should the Board hire
a new Chief Executive Officer, to whom the Employee then
reports, the Employee's remaining stock options will vest
immediately.
c. Resignation. The employment of Employee under this
Employment Agreement, and the term hereof, will be terminated by
the voluntary resignation of Employee.
6. Salary and Benefits Upon Termination. Except as specifically
provided herein, all salary and other benefits shall terminate as
of the effective date of termination if Employee resigns. If
involuntarily terminated (except following a Change in Control,
as provided for below) and in consideration for the obligations
of Employee pursuant to paragraphs 15 and 16 of the Employment
Agreement, Employee shall be entitled to a termination or
severance salary equal to the remainder of the contract at the
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time of termination. This salary will be paid one-half in cash
and one-half in the form of restricted common stock at $1.00 per
share. Employee shall have the option to accelerate payments of
the severance salary and receive the full amount upon
termination, in Employee's sole discretion. Unless precluded by
law, any medical and dental insurance coverage and benefits shall
continue for thirty (30) days after termination or until Employee
is re-employed, whichever shall first occur.
7. Termination Following Change in Control. Employer will
provide or cause to be provided to Employee the rights and
benefits described in Paragraph 9 below in the event that
Employee's employment is terminated at any time during the term
of this Agreement, or any renewal term, following a Change in
Control (as such term is defined in Paragraph 8) under
circumstances stated in (a) or (b) below.
a. The involuntary termination of Employee by Employer for
reasons other than for "Cause" (as such term is defined in
Paragraph 5 of this Agreement) or other than as a consequence of
Employee's death, permanent disability or attainment of the
normal retirement date; or
b. The voluntary termination by Employee, which shall not
result in a breach of this Agreement, following the occurrence of
any of the following events:
i. the assignment to Employee of any duties or responsibilities
that are inconsistent with Employee's position, duties,
responsibilities or statusimmediately preceding
such Change in Control, or a reduction of Employee's
responsibilities subsequent to the Change in Control;
ii. the reduction of Employee's annual salary (including any
deferred portions) or level of benefits or supplemental
compensation;
iii. the material increase in the amount of travel normally
required of Employee in connection with Employee's employment; or
iv. the good faith determination by Employee that due to the
Change in Control (including any changes in circumstances at
Employer that directly or indirectly effect Employee's position,
duties, responsibilities or status immediately preceding such
Change in Control) he is no longer able effectively to discharge
Employee's duties and responsibilities.
8. Definition of Change of Control. For purposes of this
Agreement, a "Change of Control" shall be deemed to have taken
place if:
a. a third person, including a "group" as defined in Section
13(d)(3) of the Securities Exchange Act of 1934,
becomes the beneficial owner of shares of the Employer
having more than fifty percent (50%) of the total number of
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votes that may be cast by holders of capital stock upon any
corporate action proposed to shareholders for approval or
adoption; or
b. as a result of, or in connection with, any cash tender or
securities exchange offer, merger, or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions (a "Transaction"), the persons who were
directors of the Employer before the Transaction shall cease to
constitute a majority of the Board of the Employer or any
successor corporation.
9. Benefits Entitlements. On or before Employee's last day of
employment with the Employer or any of its subsidiaries, the
Employer will pay to the Employee as compensation for services
rendered a lump sum amount, one-half in cash and one-half in
restricted common stock at $1.00 per share, (subject to any
applicable payroll or other taxes required to be withheld) equal
to the sum of,
a. Employees' highest annual salary fixed during the period
he was an employee of the Employer, plus
b. the largest aggregate amount awarded to Employee in a
year as cash bonus(whether or not deferred) under
the Corporation's short and long term cash
incentive plans or arrangements providing for performance
bonus payments during the preceding years.
10. Taxes. In the event a tax is imposed pursuant to Section
4999 of the Internal Revenue Code ("Excise Tax") on any portion
of a benefit payment made to an Employee in accordance with
Paragraph 9, Employer shall relieve the Employee of the Excise
Tax burden by paying;
a. the initial Excise Tax and
b. any additional Excise Tax and federal and state income
tax which arise as a result of Employer's payment
of the initial Excise Tax on behalf of the Employee.
11. Payment Obligations Absolute. The Employer's obligation to
pay the Employee the benefits described herein shall be absolute
and unconditional and shall not be affected by any circumstances,
including, without limitation, any set-off, counter-claim,
recoupment, defense or other right which the Employer may have
against the Employee or anyone else. All amounts payable by the
Employer shall be paid without notice or demand. Each and every
payment made by the Employer shall be final and the Employer will
not seek to recover all or any part of such payment(s) from the
Employee or from whosoever may be entitled to such payment(s) for
any reason whatsoever. The Employee shall not be obligated to
seek other employment in mitigation of the amounts payable or
arrangements made under any provisions herein, and the obtaining
of any such other employment shall in no event effect any
reduction of the Employer's or subsidiary's obligations to make
the payments and arrangements required to be made hereunder. The
Employer may at the discretion of the Board of Directors of the
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Employer enter into an irrevocable, third party guarantee or
similar agreement with a bank or other institution with respect
to the benefits payable to an Employee, which would provide for
the unconditional payment of such benefits by such third-party
upon presentment by an Employee of a Certificate (and on such
other conditions deemed necessary or desirable by the Employer)
at some specified time after termination of employment. Such
third-party guarantor shall have no liability for improper
payment if it follows the instructions of the Employer as
provided in such Certificate and other documents required to be
presented under the agreement, unless the Employer, in a written
notice, has previously advised such third-party guarantor of the
determination by its Board of Directors of ineligibility of the
Employee
12. Successors. This Agreement shall be binding upon and inure
to the benefit of the Employee and his estate, the Employer and
any applicable subsidiary and any successor of the Employer or
applicable subsidiary, but neither this Amendment nor any rights
arising under it may be assigned, pledged or disposed of in any
manner by the Employee or his beneficiary.
13. Other Agreements. Nothing in this paragraph is intended to
result in set-off of pension benefits, supplemental executive
retirement benefits, disability benefits, retiree benefits or any
other plan benefits not directly provided as termination or
separation benefits.
14. Reimbursable Expenses. The Employer shall pay directly or
reimburse the Employee for the following expenses:
a. License fees and membership dues in associations or
organizations relative to the business of the Employer,
b. Subscriptions to journals or monthly service
publications relative to the business of the Employer.
c. The Employee's necessary travel, hotel, and entertainment
expenses incurred in connection with the business of
the Employer or other events that contribute to the
benefit of the Employer in amounts to be determined by
the CEO, with input from the President.
15. Noncompetition/Nonsolicitation. Employee, as additional
material consideration hereunder, agrees that during the term
hereof and for a period of two (2) years from termination of this
Agreement, he will not directly or indirectly solicit business
from, engage in business with, or divert business from any of
Employer's current or future customers, and that they will not
participate as a shareholder, partner, employee, consultant, or
otherwise in any enterprise engaging in activities that would
violate this provision if engaged in by them directly. This
covenant shall be applicable to the World on the basis that
Employer sells its products nationally or internationally.
Employee acknowledges and agrees that the scope of this covenant
is reasonable given the special relationship of the parties as to
the various agreements executed by them. Employee acknowledges
and confirms that this covenant is made to induce Employer to
enter into this Agreement, is considered material to Employer,
and is required by Employer for the purpose of preserving the
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business and goodwill of Employer.
16. Confidentiality Provision. Employee agrees that, during the
term of this Agreement or any extensions and for a period of ten
(10) years thereafter, he will keep confidential any information
which he obtains from Employer or any of said entities'
subsidiaries, sister corporations or concerns, now or hereafter
existing or created, concerning their properties, assets,
proprietary assets, source codes, copyrights, business methods,
and trade secrets. Upon termination hereof, Employee will return
to Employer all written matter with respect to such businesses
obtained by him in connection with the negotiation, consummation,
or performance of this Agreement. Employee further agrees that
any work performed or created by Employee during the term hereof
shall be owned solely by Employer and shall be subject to the
terms of this provision.
17. Modification. No change or modification of this Agreement
shall be valid unless the same is in writing and signed by all
the parties hereto.
18. Binding Effect. The contract shall be binding upon the heirs,
executors, administrators, and assigns of the Employee and any
successors in interest of the Employer.
19. Notice. Except as expressly provided to the contrary herein,
notices or other communications required, permitted, or made
necessary by the terms of this Agreement may be given orally to
the respective representatives of the Employer and the Employee
designed herein. Written notices shall be personally delivered to
the Employer's representative or the Employee's representative,
as appropriate or sent by the United States registered or
certified mail, postage prepaid, return receipt requested,
addressed to the party as designated below. Notices sent by mail
shall be deemed made, delivered and received on the date of the
United States postmark thereon. Either party may change its
address or notice by giving notice of such change to the other
party in the manner specified in this section.
For purposes of notice the addresses of the parties shall be:
If to Employer:
WebQuest International, Inc.
0000 Xxxxxxxx Xxxx., Xxxxx X
Xxxxxx, XX 00000-0000
Attn: CEO
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If to Employee:
Xxxxx Xxxxx
000 Xxxxx Xxxxxx
Xxxx, XX 00000-0000
20. No Waiver. No waiver of any breach or default in any of the
terms and provisions of this Agreement shall be deemed to
constitute or be construed as a waiver of the subsequent breach
or default of the same, similar or dissimilar nature.
21. Choice of Law and Invalidity. The validity construction,
performance and effect of this Agreement shall be governed by the
laws of the State of Nevada and jurisdiction shall vest
exclusively in the Ninth Judicial District Court in and for the
State of Nevada, located in Xxxxxxx County. The parties
acknowledge and agree that this Agreement is executed and
performance hereof is due in Xxxxxxx County, State of Nevada. In
case any one or more of the provisions contained herein shall for
any reason be held to be invalid, illegal, or unenforceable in
any respect, such invalidity, illegality, or unenforceability
shall not affect any other provisions of this Agreement, but this
Agreement shall be construed as if such invalid, illegal, or
unenforceable provisions contained herein shall, for any reason,
be held to be excessively broad as to time, duration,
geographical scope, activity or subject, said provision shall be
construed by limiting and reducing it so as to be enforceable to
the extent compatible with the then applicable law, it being the
intent of the parties hereto to give the maximum permitted effect
to the restrictions set forth herein.
22. Assignment. This Agreement is one for personal services and
the Employee shall not have a right to assign any part or all of
his respective rights, duties or obligations hereunder.
23. Interpretation. If necessary to give effect to the terms and
provisions hereof, the masculine, feminine, and neuter gender in
the singular and plural number shall each be deemed to include
the other whenever the context so indicates.
24. Headings. Headings in this Agreement are inserted for
convenience and identification only and are in no way intended to
describe, interpret, define or limit the scope, extent or intent
of this Agreement or any provision hereof
25. Counterparts. This Agreement may be executed in any number of
counterparts, any of which may be constituted in the agreement
between the parties hereto.
26. Authority. The Employer warrants and represents that it is a
corporation organized and existing under the laws of the State of
Nevada, that the undersigned is authorized to execute this
Agreement on behalf of the Employer; that the employment of the
Employee under the terms of this Agreement has been duly
authorized by the Employer.
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27. Inurement. Each covenant and condition in this Agreement
shall be binding on, and shall insure solely to the benefit of
the parties to it, their respective heirs, legal representatives
successors and assigns.
28. Entire Agreement. Except as otherwise provided herein, this
Agreement supersedes any and all other agreements, either oral or
in writing, between the parties hereto and contains all of the
covenants and agreements between the parties with respect to this
matter. Each party to this Agreement acknowledges that no
representations, inducements, promises, or agreements, orally or
otherwise, have been made by any party, or anyone acting on
behalf of any party, which are not embodied herein, and that no
other agreement, statement or promise not contained in this
Agreement shall be binding.
IN WITNESS WHEREOF, the parties have executed this Employment
Agreement effective as of the day and year first above written.
EMPLOYEE: EMPLOYER:
WebQuest International, Inc.
a Nevada Corporation,
/s/ Xxxxx Xxxxx By: /s/ Xxxx Xxxxxxx
Xxxxx Xxxxx
Xxxx Xxxxxxx, Chairman
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