Exhibit 10.05
ADDENDUM 3 TO THE BEAVON EMPLOYMENT AGREEMENT OF 8-01-02
The following are amendments to the Xxxxxx Xxxxxx Employment Agreement with
SCHIMATIC Cash Transactions Xxxxxxx.xxx, Inc. dba Smart Chip Technologies
("Company," "SCTN" or "Employer") effective 8-01-02 as amended by Addendums on
7-28-03 and 5-05-2004:
For the purpose of cleaning up the "stock overhang" of the Company, as dictated
by the Board of Directors, the Company and Beavon agree to the following
regarding Stock, Stock Options and Bonuses. The stock to be issued under the
terms of this agreement will settle all prior agreements related to stock, stock
options, and agreements to convert debts to stock. All stock will be issued
effective the date of this agreement, but physical certificates representing
that stock will not be printed and delivered to Beavon until the shareholders
meet and approve an increase to the limit of shares authorized.
1. Under previous agreements Xxxxxx Xxxxxx has the rights to the
following:
a. Stock options to purchase 4,000,000 shares at $.05 per
share, and the company has agreed to expense the exercise
price, and all applicable taxes and withholding thereon;
b. Stock options to purchase 39,063 shares at $.128 per share;
c. 60,000 shares exercised by non-recourse note in the
amount of $7,680;
d. Accrued salary from August 1, 2002 through June 30, 2004,
that can be converted to 3,220,000 shares;
e. Deferred compensation agreement dated July 31, 2002 in the
amount of $130,375, which is convertible to stock at 70% of
market price;
2. Under this agreement Xxxxxx Xxxxxx agrees to the following:
a. All references to converting unpaid salary to stock or stock
options are void.
b. All references to converting unpaid business expenses to
stock or stock options are void.
ADDENDUM 3 TO THE BEAVON EMPLOYMENT AGREEMENT OF 8-01-02 Page 2
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c. The Addendums to the Beavon Employment Agreement of 8-01-02
are hereby affirmed by this agreement, with the exception of
Beavon's ability to convert money due to stock or options.
x. Xxxxxx gives up her right to have the company expense the
exercise price of 4,000,000 shares at $.05 per share,
including all applicable taxes and withholding thereon.
x. Xxxxxx and the Company agree to convert Beavon's accrued
salary from August 1, 2002 through June 30, 2004 to
3,220,000 shares, per the terms of the employment agreement.
x. Xxxxxx agrees to convert her Deferred Compensation Agreement
dated July 31, 2002 in the amount of $130,375, to stock at
70% of the closing market price as of the date of this
agreement.
x. Xxxxxx agrees that she will not ask for any additional
shares or options as compensation for employment through the
end of her employment agreement.
x. Xxxxxx agrees that if the Company does not have sufficient
working capital to pay salaries in full, the Board will
determine when payments are made.
3. Under this agreement Xxxxxx Xxxxxx is being granted the following:
a. A performance bonus of 1,500,000 shares;
b. A settlement for forgoing all rights that would accrue in
the future, as agreed above, of 1,500,000 shares.
c. Rights to stock options to purchase 4,000,000 at $.05 per
share are being affirmed and a bonus is hereby granted to be
used to exercise those options equivalent to the funds
needed to exercise the 4,000,000 options to purchase shares
as of this date.
d. Rights to stock options to purchase 39,063 at $.128 per
share are being affirmed and a bonus is hereby granted to be
used to exercise those options equivalent to the funds
needed to exercise the 39,063 options to purchase shares as
of this date.
ADDENDUM 3 TO THE BEAVON EMPLOYMENT AGREEMENT OF 8-01-02 Page 3
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e. A bonus in the amount of $7,680 to pay off the non-recourse
note used to purchase 60,000 option shares.
Subject to review by Xxxxx Xxxxx, the method of recording these transactions may
be modified in conformance with the best interest of the Company, including tax
liability.
I HAVE READ THIS AGREEMENT IN ITS ENTIRETY, I UNDERSTAND ITS TERMS, AND AGREE TO
BE BOUND BY ALL OF ITS TERMS. I ALSO UNDERSTAND I HAVE THE RIGHT TO HAVE THIS
AGREEMENT REVIEWED BY INDEPENDENT COUNSEL.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on July 7,
2004.
Employer: Employee:
SCTN Xxxxxx Xxxxxx
000 X. Xxxx Xxxxxxx Xx. 0000 X. Xxxxxxx Xxxx.
Xxx Xxxxx, XX 00000 Xxxxx, XX 00000
By: /s/ Xxxxxxx XxXxxx By: /s/ Xxxxxx Xxxxxx
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Xxxxxxx XxXxxx, Director Xxxxxx Xxxxxx
By:__________________________
Xxxxxx X. Xxxxxxx, Vice President and Director
