Exhibit 10.2
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EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT entered into as of this 14th day of June
2003, between MR3 Systems, Inc., a Delaware corporation, located at 000 Xxxxxxx
Xxxxxx, Xxxxx 000, Xxx Xxxxxxxxx, XX 00000 (the "Company"), and Xxxxxx X. XxXxx,
Ph.D., of 000 Xxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxxxx 00000 (the `Executive").
WHEREAS, the Company desires to employ Executive and to ensure the
continued availability to the Company of the Executive's services, and the
Executive is willing to accept such employment and render such services, all
upon and subject to the terms and conditions contained in this Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants set forth in this Agreement, and intending to be legally bound, the
Company and the Executive agree as follows:
1. Term of Employment.
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(a) Term. The Company hereby employs the Executive, and the
Executive hereby accepts employment with the Company, for a period commencing on
the date of this Agreement and ending three years from the date hereof (the
"Term").
(b) Continuing Effect. Notwithstanding any termination of this
Agreement at the end of the Term or otherwise, the provisions of Sections 6 and
7 shall remain in full force and effect and the provisions of Sections 6(a),
6(b) and 7 shall be binding upon the legal representatives, successors and
assigns of the Executive, except as otherwise provided in this Agreement.
2. Duties.
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(a) General Duties. The Executive shall serve as Chief Science
Officer for the Company with duties and responsibilities that are customary for
such executives. The Executive will also perform services for such subsidiaries
as may be necessary. The Executive will use his best efforts to perform his
duties and discharge his responsibilities pursuant to this Agreement
competently, carefully and faithfully. In determining whether or not the
Executive has used his best efforts hereunder, the Company's delegation of
authority to other employees and all surrounding circumstances shall be taken
into account and the best efforts of the Executive shall not be judged solely on
the Company's earnings or other results of the Executive's performance.
(b) Devotion of Time. The Executive will devote substantially full
time normal business hours (exclusive of periods of sickness and disability and
of such normal holiday and vacation periods as have been established by the
Company) to the affairs of the Company. It is expressly understood that the
Executive will not enter the employ of or serve as a consultant to, or in any
way perform any services with or without compensation to any other persons,
business or organization (other than as set forth above) without the prior
consent of the Board of Directors of the Company.
3. Compensation and Expenses.
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(a) Salary. For the services of the Executive to be rendered under
this Agreement, the Company shall pay the Executive an annual base salary of
$120,000 during the Term. The Company will pay the Executive his annual salary
in equal installments no less frequently than monthly. Salary may be accrued and
can also be convertible, in whole or in part, into shares of the Corporation's
Common Stock at the per share market price in effect at the end of each
applicable pay period. Executive must notify the Corporation of such conversion,
in writing, within 30 days of the end of the applicable pay period.
(b) Royalty. The Company shall pay to the Executive an annual
royalty equal to 5% of the Net Profits of the Company received from the sale or
utilization of its MR3 technologies during the Company's fiscal year ending
December 31, of each year. Such royalties shall be paid on or before January 31
of each year during the Term hereof, and shall terminate once a cumulative total
of $2,500,000 in royalties has been paid to the Executive hereunder.
(c) Bonuses.
The Executive may receive additional annual bonuses if and
when authorized by the Company's Board of Directors.
(d) Expenses. In addition to any compensation received hereunder
the Company will reimburse or advance funds to the Executive for all reasonable
travel, entertainment and miscellaneous expenses incurred in connection with the
performance of his duties under this Agreement, provided that the Executive
properly accounts for such expenses to the Company in accordance with the
Company's practices. Such reimbursement or advances will be made in accordance
with policies and procedures of the Company in effect from time to time relating
to reimbursement of or advances to executive officers.
4. Benefits.
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(a) Vacation. For each 12-month period during the Term, the
Executive will be entitled to four weeks of vacation without loss of
compensation or other benefits to which he is entitled under this Agreement, to
be taken at such times as the Executive may select and the affairs of the
Company may permit.
(b) Employee Benefit Programs. Without limiting the compensation
to which the Executive is entitled pursuant to the provisions of Section 3 or
this Section 4, during the Term, the Executive will be entitled to participate
in any pension, insurance or other employee benefit plan that is maintained at
that time by the Company for its executive officers, including programs of
medical insurance.
(c) Automobile Allowance. Executive shall be entitled to an
automobile allowance of $500/month.
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5. Termination.
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(a) Termination for Cause. The Company may terminate the
Executives employment pursuant to the terms of this Agreement at any time for
cause by giving written notice of termination. Such termination will become
effective upon the giving of such notice, except that termination based upon
clause (iii) below shall not become effective unless the Executive shall fail to
correct such breach within 45 days of receipt of written notice. At the
conclusion of such 45-day period, this alleged breach shall be deemed to have
been cured unless written notice to the contrary is given. Upon any such
termination for cause, the Executive shall have no right to compensation, bonus
or reimbursement under Section 3. "Cause" shall mean: (i) the Executive is
convicted of a felony which is related to the Executive's employment or the
business of the Company; (ii) the Executive, in carrying out his duties
hereunder, has been found in a civil action to have committed gross negligence
or gross misconduct, misappropriated Company funds, or otherwise defrauded the
Company, in any case, in material harm to the Company; and (iii) the Executive
materially breaches any provision of Section 6 or Section 7.
(b) Continuing Effect. Notwithstanding any termination of the
Executive's employment as provided in this Section 5, the provisions of Sections
6 and 7 shall remain in full force and effect.
6. Non-Competition Agreement.
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(a) Competition with the Company. Except as provided for in
Sections 2(b) and 6(b) hereof, until termination of his employment and for a
period of 6 months commencing on the date of termination, the Executive,
directly or indirectly, in association with or as a stockholder, director,
officer, consultant, employee, partner, joint venturer, member or otherwise of
or through any person, firm, corporation partnership, association or other
entity, will not compete with the Company or any of its affiliates in the offer,
sale or marketing of products or services that are competitive with the products
or services offered by the Company, within any metropolitan area in the United
States or elsewhere in which the Company is then engaged in the offer and sale
of competitive products or services. Additionally, the foregoing shall not
prevent Executive from accepting employment with an enterprise engaged in two or
more lines of business, one of which is the same or similar to the Company's
business (the "Prohibited Business") if Executive's employment is totally
unrelated to the Prohibited Business.
(b) Solicitation of Customers. During the periods in which the
provisions of Section 6(a) shall be in effect, the Executive, directly or
indirectly, will not seek Prohibited Business from any Customer (as defined
below) on behalf of any enterprise or business other than the Company, refer
Prohibited Business from any customer to any enterprise or business other than
the Company or receive commissions based on sales or otherwise relating to the
Prohibited Business form any Customer, or any enterprise or business other than
the Company. For purposes of this Section 6(b), the term "Customer" means any
person, firm, corporation, partnership, association or other entity to which the
Company or any of its affiliates sold or provided goods or services during the
12-month period prior to the time at which any determination is required to be
made as to whether any such person, firm, corporation, partnership, association
or other entity is a Customer.
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(c) No Payment. The Executive acknowledges and agrees that no
separate or additional payment will be required to be made to him in
consideration of his undertakings in this Section 6.
7. Proprietary Information and Inventions.
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(a) The Executive acknowledges that the Company is engaged in a
continuous program of research, development and production respecting its
business, present and future, including fields generally related to its business
and that the Company possesses and will continue to possess information that has
been created by, discovered or developed by, or made known to the Executive
during the period of or arising out of his employment by the Company and/or in
which property rights have been assigned or otherwise conveyed to the Company,
which information has commercial value in the business in which the Company is
engaged. All of the aforementioned information is hereinafter called
"Proprietary Information." By the way of illustration, but not limitation,
Proprietary Information includes trade secrets, processes, formulas, data,
know-how, software programs, improvements, inventions, techniques, marketing
plans, strategies, forecasts, computer programs, copyrightable material, and
customer lists.
(b) All Proprietary Information shall be the sole property of the
Company and its assignees, and the Company and its assigns shall be the sole
owner of all patents and other rights in connection therewith.
The Executive hereby assigns to the Company any rights he may have or
acquire in such Proprietary Information, as well as any rights he may have to
the patents and patents "pending" listed in the attached Exhibit "A." At all
times, both during his employment by the Company and after its termination, the
Executive will keep in confidence and trust all Proprietary Information, and
will not use or disclose any Proprietary Information or anything relating to it
without the written consent of the Company, except as may be necessary in the
ordinary course of performing his duties to the Company.
(c) All documents, records, apparatus, equipment and other
physical property, whether or not pertaining to Proprietary Information,
furnished to the Executive by the Company or produced by the Executive or others
in connection with his employment shall be and remain the sole property to the
Company and shall be returned to it immediately as and when requested by the
Company. Even if the Company does not so request, the Executive shall return and
deliver all such property upon termination of his employment for any reason and
the Executive will not take with him any such property or any reproduction of
such property upon such termination.
(d) The Executive will promptly disclose to the Company, or any
persons designated by it, all improvements, inventions, formulas, ideas,
processes, techniques, know-how and data, whether or not patentable, made or
conceived of reduced to practice or learned by the Executive, either alone or
jointly with others, during the term of his employment (all said improvements,
inventions, formulas, ideas, processes, techniques, know-how and data shall be
hereinafter collectively called "Inventions").
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(e) The Executive agrees that all Inventions which he developed
(in whole or in part, either alone or jointly with others) and (I) used the
equipment, supplies, facilities or trade secret information of the Company, or
(II) used the hours for which he was compensated by the Company, or (III) which
relates to the business of the Company or its actual or demonstrably anticipated
research and development or (1V) which results, in whole or in part, from work
performed by him for the Company, shall be the sole property of the Company and
its assigns, and the Company and its assigns shall be the sole owner of all
patents and other rights in connection therewith. The Executive hereby assigns
to the Company any rights he may have or acquires in such Inventions. The
Executive further agrees as to all such Inventions to assist the Company in
every proper way, but at the Company's expense; to obtain and from time-to-time
enforce patents on said Inventions in any and all countries, and to that end,
the Executive will execute all documents for use in applying for and obtaining
such patents and copyrights thereon and enforcing same, as the Company may
desire, together with any assignments thereof to the Company or persons
designated by it. The Executive's obligation to assist the Company in obtaining
and enforcing patents for such Inventions in any and all countries shall
continue beyond the termination of his employment, but the Company shall
compensate the Executive at a reasonable and mutually agreed upon rate after
such termination for time actually spent by the Executive at the Company's
request on such assistance. In the event that the Company is unable for any
reason whatsoever to secure the Executive's signature to any lawful and
necessary document required to apply for or execute any patent applications with
respect to such an Invention (including renewals, extensions, continuations,
divisions or continuations in part thereof), the Executive irrevocably
designates and appoints the Company and its duly authorized officers and agents,
as his agents and attorneys-in-fact to act for and in his behalf and instead of
him, to execute and file any such application to do all other lawfully permitted
acts to further the prosecution and issuance of patents thereon with the same
legal force and effect as if executed by the Executive.
(f) The Executive represents to the best of his knowledge that his
performance of all the terms of this Agreement will not breach any agreement to
keep in confidence proprietary information acquired by him in confidence or in
trust prior to his employment by the Company. The Executive has not entered
into, and agrees he will not enter into, any agreement either written or oral in
conflict herewith.
8. Assignability.
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With the written consent of the Executive, the rights and obligations
of the Company under this Agreement shall inure to the benefit of and be binding
upon the successors or assigns of the Company, provided that such successor or
assign shall acquire all or substantially all of the assets and business of the
Company. The Executive's obligations hereunder may not be assigned or alienated
and any attempt to do so by the Executive will be void.
9. Severability.
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(a) The Executive expressly agrees that the character, duration
and geographical scope of the provisions set forth in this Agreement are
reasonable in light of the circumstances, as they exist on the date hereof.
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Should a decision, however, be made at a later date by a court or legal
proceeding that the character, duration or geographical scope of such provisions
is unreasonable, then it is the intention of the agreement of the Executive and
the Company that this Agreement shall be construed by the court or tribunal in
such a manner as to impose only those restrictions on the Executive's conduct
that are reasonable in the light of the circumstances and as are necessary to
assure to the Company the benefits of this Agreement. If in a legal proceeding,
a court shall refuse to enforce all of the separate covenants deemed included
herein because taken together they are more extensive than necessary to assure
to the Company the intended benefits of this Agreement, it is expressly
understood and agreed by the parties hereto that the provisions of this
Agreement that, if eliminated, would permit the remaining separate provisions to
be enforced in such proceeding shall be deemed eliminated, for the purposes of
such proceeding, from this Agreement.
(b) If any provision of this Agreement otherwise is deemed to be
invalid or unenforceable or is prohibited by the laws of the state or
jurisdiction where it is to be performed, this Agreement shall be considered
divisible as to such provision and such provision shall be inoperative in such
state or jurisdiction and shall not be part of the consideration moving from
either of the parties to the other. The remaining provisions of this Agreement
shall be valid and binding and of like effect as though such provision were not
included.
10. Notices and Addresses.
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All notices, offers, acceptance and any other acts under this Agreement
(except payment) shall be in writing, and shall be sufficiently given if
delivered to the addressees in person, by Federal Express or similar receipted
delivery, by facsimile delivery or, if mailed, postage prepaid, by certified
mail, return receipt requested to the respective addresses first above written,
or to such other address as either of them, by notice to the other, may
designate from time to time. The transmission confirmation receipt from the
sender's facsimile machine shall be conclusive evidence of successful facsimile
delivery. Time shall be counted to, or from, as the case may be, the delivery in
person or by mailing.
11. Counterparts.
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This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original but all of which together shall constitute one
and the same instrument. The execution of this Agreement may be by actual or
facsimile signature.
12. Attorneys Fees.
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In the event that there is any controversy or claim arising out of or
relating to this Agreement, or to the interpretation, breach or enforcement
thereof, and any action or proceeding under this Agreement, is commenced to
enforce the provisions of this Agreement, the prevailing party shall be entitled
to an award by the court or arbitrator, as appropriate, of reasonable outside
attorney's fee, costs and expenses.
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13. Governing Law.
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This Agreement and any dispute, disagreement, or issue of construction
or interpretation arising hereunder whether relating to its execution, its
validity, the obligations provided therein or performance shall be governed or
interpreted according to the internal laws of the State of California without
regard to choice of law considerations.
15. Entire Agreement.
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This Agreement constitutes the entire Agreement between the parties and
supersedes all prior oral and written agreements between the parties hereto with
respect to the subject matter hereof. This Agreement may not be changed, waived,
discharged or terminate orally, except by a statement in writing signed by the
party or parties against which enforcement of the change, waiver, discharge or
termination is sought.
16. Section and Paragraph Headings.
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The section and paragraph headings in this Agreement are for reference
purposes only and shall not affect the meaning or interpretation of this
Agreement.
IN WITNESS WHEREOF, the Company and Executive have executed this
Agreement as of the date and first above written.
MR3 SYSTEMS, INC. EXECUTIVE
By: /s/ XXXXXXX X. XXXXXX By: /s/ XXXXXX X. XXXXX
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Xxxxxxx X. Xxxxxx Xxxxxx X. XxXxx, Ph.D
President
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EXHIBIT A
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PATENTS
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TITLE INVENTORS COUNTRY PATENT NO. DATE
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1 IWD & BEH Canada 1,206,057 June 17, 1986
2 IWD & BEH Canada 1,207,628 July 5, 1986
2 IWD & BEH Canada 1,215,545 December 23, 1986
2 IWD & BEH USA 4,626,416 December 2, 1985
2 IWD & BEH USA 4,530,963 July 23, 1985
2 IWD & BEH USA 4,585,559 April 29, 1986
2 IWD & BEH Europe 83/ 107137.8 July 21,1983
2 IWD & BEH Australia 554,842 July 19, 1983
3 IWD & BEH Canada 1,211,338 September 16, 1986
3 IWD & BEH South Africa 84/9177 July 31, 1985
2 IWD & BEH Europe 84/110,501.8 September 4, 1984
2 IWD & BEH New Zealand 204,701.00 June 24, 1983
4 IWD & BEH New Zealand 214,439.00 December 4, 1985
5 IWD & BEH New Zealand 214,440.00 December 4, 1985
2 IWD & BEH Japan 58-129604 July 18, 1983
2 IWD & BEH Australia 33784/84 October 4, 1984
6 IWD & BEH USA 5,066,371 November 19, 1991
7 IWD & BEH USA 5,089,123 February 18,1992
PATENT TITLES:
1. Siderophoric compositions
2. Insoluble chelating compositions
3. Insoluble compositions
4. Removal of FE3+. TH3+, UO22+, or mixtures thereof from solution
5. Separation of TH4+ from an insoluble composition
6. Removal of contaminants and recovery of metals from waste solutions
7. Apparatus for continuous removal of materials from liquid
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EXHIBIT B
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ANTIDILUTION AGREEMENT
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This ANTIDILUTION AGREEMENT ("Agreement") is made on this day October
19, 1999 by and between Bioponic International ("Bioponic"), a California
Corporation located at Xxxx 00, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000 and Xxxxxx X.
XxXxx, an individual residing at 00 Xxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxxxx
00000 for the purpose of granting additional Warrants to maintain the same
percentage of ownership in this Corporation.
THEREFORE, the parties agree as follows:
1. Bioponic agrees to grant to Xxxxxx X. XxXxx anti-dilution protection
against any further stock issuances by Bioponic subsequent to June 30,
1999.
2. Bioponic agrees that Xxxxxx X. XxXxx shall have the right to maintain
his thirteen percent (13%) equity ownership in Bioponic, through the
issuance of Warrants to purchase Common Stock in the Company.
3. Bioponic hereby grants to Xxxxxx X. XxXxx the right to receive
additional 5-year Warrants at an exercisable price to 10 cents per
Common Share, or ten percent (10%) of the price by others for the
issuance of additional equities securities, whichever is greater. This
Agreement shall terminate should Xxxxxx X. XxXxx cease to be employed
by the Company.
EXECUTED effective the date first set forth above.
Bioponic International
By: /s/ XXXXXXX X. XXXX By: /s/ XXXXXX X. XXXXX
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Xxxxxxx X. Xxxx Xxxxxx X. XxXxx
Chairman & CEO
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