Exhibit 10.5
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is made and entered into as of
September 17, 2000, between Statmon Technologies Corp. (a Delaware Corporation
("STC" or the "Company") and Xxxxxxxx Xxxxxx, of Los Angeles, California (the
"Executive").
WHEREAS, the Company was incorporated on June 17, 2000 as an Information
Technology ("IT") and Internet Protocol ("IP") business formed to develop, own,
distribute and support remote control, device and computer network monitoring
software, operating systems and generally IT related intellectual properties.
The Company owns all rights, interest and title to the properties known as
Statmon(R) 2000 and Taskmon 2000.
WHEREAS, Executive is a co-founder of the Company;
WHEREAS, the Company may form or acquire other subsidiaries and assets in the
future;
WHEREAS, the Company intends to complete a series of private placements and
intends to complete a public offering ("Offering") or public company merger with
the objective of the Company's securities being listed on a national U.S.A.
stock exchange;
WHEREAS, Company desires to employ Executive as Chairman and Chief Executive
Officer as described below and to use its best efforts to cause Executive to
remain appointed as a director of the Company and all subsidiaries of the
Company, whether now in existence or hereinafter formed, and to employ Executive
in the offices described above;
WHEREAS, Executive desires to be employed by Company as Chairman and Chief
Executive Officer and to serve as a director of Company and to perform such
duties as are assigned to him by the Board of Directors (the "Board") subject to
the terms, covenants and conditions set forth herein;
NOW, THEREFORE, for and in consideration of the mutual covenants and promises
herein contained, the receipt and adequacy of which are hereby acknowledged, the
parties hereto agree as follows:
1. Employment.
Company hereby agrees to employ Executive and engage the services of Executive
during the Term (as hereinafter defined) as Chairman and Chief Executive Officer
with the title, Chief Executive Officer, as a director of the Company and every
subsidiary of the Company. Executive agrees to serve Company and its
subsidiaries in such capacities and positions during the Term. Executive shall
report to the Board, and subject to the delegated authority of the Board. During
the term of this Agreement, Executive shall faithfully devote his best efforts
and such time and energy as shall be necessary to the satisfactory performance
and discharge of his duties and responsibilities hereunder, subject to the
reasonable policies and directives of the Board of Directors of the Company;
provided, however, that Executives duties and responsibilities shall at all
times be consistent with his positions as set forth above. Executive shall fully
disclose any extra curricular
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business activity other than reasonable, personal investments and shall have no
business interests during the Term which materially interfere with his
performance and discharge of his duties hereunder, at the total discretion of
the Board.
2. Term.
The term of Executive's employment hereunder shall be for a period commencing
upon the date of this Agreement and ending five (5) years from the date of
closing financing in the aggregate of a minimum of $1,000,000 in gross proceeds
(the "Term").
3. Compensation.
(a) Base Salary. During the Term, Executive shall receive a base minimum
salary payable in equal bi-monthly installments at an annual rate
for each year of the term as specified below:
First year: $160,000
Second year $205,000
Third year $245,000
Fourth year $275,000
Fifth year $300,000
Based on the profit performance of the Company, additional increases
may be negotiated and approved by the Compensation Committee. In the
event that the Company is unable to raise an aggregate of $2 million
of new capital, the Executive agrees to renegotiate his Base Salary
for years 3, 4 and 5 down. Notwithstanding anything to the contrary,
under no circumstances shall Executive's Base Salary during each of
the Years 3,4, and 5 be less than the Base Salary for the Second
Year ($205,000).
(b) Bonus. With respect to each year or partial year of the Term during
which Executive shall be employed hereunder, Executive shall
participate in any and all bonus plans at the same level as Chief
Technology Officer. Such bonus plans to be set yearly at the
discretion of the compensation committee.
(c) Profit Sharing Plan & Retirement Plan. With respect to each year or
partial year of the Term during which Executive shall be employed
hereunder, Executive shall be paid , in addition to the base salary
set forth above, an amount at the discretion of the compensation
committee at the same level as Chief Technology Officer pursuant to
any Profit Sharing Plan and/or Retirement Plan offered by the
Company.
(d) Incentive Plan. In addition to the base salary and other
compensation specified herein, Executive shall be entitled to
receive the following:
(i) Shares and Options. Prior to the commencement of the Term,
Executive has been issued 800,000 fully paid and nonassessable
"Founders" shares of common stock of Company for nominal
consideration ("Founders shares"). The Founder shares
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have full piggyback registration rights and are subject to an
escrow agreement, to be released at 20% per annum starting at
the commencement of this agreement and every anniversary
thereafter except in the following circumstances which will
cause all shares to immediately vest:
a. the Company's market capitalization exceeds $50 million
in any 90 day period, commencing 12 months after the
Company's share trade on a national stock exchange.
b. the voting control of the Company changes by more than
40 %.
c. Termination without cause.
(ii) Other Options and Warrants. In addition to the options or
warrants described in (i) above, the Executive shall
participate at a level in the granting of all options or
warrants for stock and any qualified or non qualified stock
option plan, phantom stock plans, employee stock ownership
plans or other similar such plans or arrangements established
from time to time by the Company at the same level as the
Chief Technology Officer determined by the compensation
committee.
(e) Benefits. In addition to the compensation specified in this Section
3, Company shall, at no cost to Executive and for as long as
Executive shall remain employed pursuant hereto, provide to
Executive and Executive's family, normal industry standard medical
reimbursement, health disability and provide Executive with benefits
thereunder commensurate with the executive offices held by Executive
hereunder.
(f) Expenses. During the term of this Agreement, Executive shall submit
monthly invoices to Company for appropriate travel and other
reasonable and necessary expenses incurred in the performance of
Executive's services hereunder. Company shall make payments to
Executive to reimburse Executive for such expenses promptly after
receipt and approval of such invoices by Executives direct
supervisor. For domestic flights of one hour or more and for all
international flights, Executive shall be entitled to business class
travel or first class if business class in not available, at
Company's sole cost and expense. A relocation allowance of $5,000
will be granted to Executive for moving from Los Angeles to San
Diego.
(g) Automobile., Company shall provide to Executive an appropriate
luxury automobile (not exceeding $80,000) of Executives choice and
exclusive use. At Company's option the automobile may be leased or
purchased and shall be fully maintained at the Company's expense.
(h) Vacation. Executive shall be entitled to four (4) weeks of paid
vacation days in each calendar year. Executive shall also be
entitled to all paid holidays given by Company to its other
employees.
(i) Officer Liability Insurance. To the extent commercially available,
the Company shall provide at no cost to the Executive, appropriate
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personal liability insurance covering the Executive's acts as an
officer and director of Company to the fullest extent that insurance
coverage is available for such acts. Company shall not, however, be
obligated to obtain insurance for Executive's conduct which is
dishonest, fraudulent or grossly negligent.
(j) Life Insurance. Company shall provide to Executive personal term
life insurance in the amount of $2,000,000 throughout the Term. The
beneficiary of such policy to be designated by the Executive.
(k) Long-term Disability. Company shall provide to Executive Long-term
Disability insurance in the amount of $300,000 throughout the Term.
4. Termination.
Executive's employment with the Company shall cease and terminate upon the
occurrence of any one of the following events
(a) Term. Termination shall be effective upon the expiration of the Term
pursuant to Section 2 hereof unless Company and Executive agree in
writing to extend the employment. Such expiration of Term shall
terminate any and all obligations of the Executive to the Company
under Section 1 of this Agreement. The Company shall continue to be
obligated to the Executive under this Agreement for the following:
(i) any and all earned and unpaid base salary, bonus, profit sharing
and/or retirement plan, vested interests under incentive plans, and
unused vacation time pursuant to sections 3(a), 3(b), 3(c), 3(d),
and 3(h) as of the date of termination. Such earned and unpaid
salary under 3(a) and unused vacation time under 3(h) shall be paid
within thirty (30) days of the date of termination. At the election
of the Executive, such earned and unpaid bonus under 3(b), profit
sharing and/or retirement plan under 3(c), and vested interests in
incentive plans under 3(d) shall be paid within one hundred and
eighty (180) days of termination at the then Fair Market Value (as
hereinafter defined.)
(ii) any and all incurred and unreimbursed expenses pursuant to
Section 3(f). Such unreimbursed expenses shall be paid within thirty
(30) days of the receipt of expense report.
(iii) any and all incurred or future losses, claims, damages,
liabilities, expenses, judgments, fines, settlements or other
amounts arising from any and all claims, costs, demands, actions,
suits or other proceedings pursuant to Section 6. Such incurred
amounts shall be paid within thirty (30) days of termination; such
future amounts shall be paid within thirty (30) days of submission
of written claim by Executive to Company.
(iv) any and all obligations and provisions pursuant to Section 5
remain in effect.
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All other obligations of the Company shall terminate upon the date
of termination.
(b) Death. In the event of the Death of the Executive, such death shall
terminate any and all obligations of the Executive to the Company
under this Agreement effective as of the date of death. The Company
shall continue to be obligated to the Executive, Executive's estate,
legal representative, heirs or assigns under this Agreement for the
following:
(i) any and all earned and unpaid base salary, bonus, profit sharing
and/or retirement plan, vested interests in incentive plans, and
unused vacation time pursuant to sections 3(a), 3(b), 3(c), 3(d),
and 3(h) as of the date of death. Such earned and unpaid salary
under 3(a) and unused vacation time under 3(h) shall be paid within
thirty (30) days of the date of death. At the election of the
Executor or Administrator of the Executive's estate, such earned and
unpaid bonus under 3(b), profit sharing and/or retirement plan under
3(c), and vested interests in incentive plans under 3(d) shall be
paid within one hundred and eighty (180) days of death at the then
Fair Market Value (as hereinafter defined).
(ii) any and all incurred and unreimbursed expenses pursuant to
Section 3(f). Such unreimbursed expenses shall be paid within thirty
(30) days of the receipt of expense report.
(iii) any and all benefits pursuant to section 3(e) for the benefit
of the Executive's family shall be continued for a period of one
hundred and eighty (180) days from the date of death.
(iv) any and all incurred losses, claims, damages, liabilities,
expenses, judgments, fines, settlements or other amounts arising
from any and all claims, costs, demands, actions, suits or other
proceedings pursuant to Section 6. Such amounts shall be paid within
thirty (30) days of death.
(v) any and all obligations and provisions pursuant to Section 5
remain in effect.
All other obligations of the Company shall terminate upon the date
of death.
(c) Incompetence. In the event of the physical or mental disability of
the Executive so as to render Executive incapable of substantially
complying with the obligations of the Executive as set forth in this
Agreement for a period in excess of four (4) months, the Company
may, prior to the date the Executive resumes the rendering of
services pursuant to this Agreement, terminate the Executive's
employment upon receipt by Executive of written notice sent by
registered or certified mail. Such disability shall be determined by
the unanimous opinion of two medical doctors, board certified and
licensed to practice medicine in the state of California, at least
one of whom is appointed by the Executive. Such notice shall
terminate any and all obligations
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of the Executive to the Company under Section 1 of this Agreement
effective as of the date of receipt of such notice of termination.
The Company shall continue to be obligated to the Executive, his
legal representative, or assigns under this Agreement for the
following:
(1) any and all earned and unpaid base salary, bonus, profit sharing
and/or retirement plan, vested interests under incentive plans, and
unused vacation time pursuant to sections 3(a), 3(b), 3(c), 3(d),
and 3(h) as of the date of termination. Such earned and unpaid
salary under 3(a) and unused vacation time under 3(h) shall be paid
within thirty (30) days of the date of termination. At the election
of the Executive, such earned and unpaid bonus under 3(b), profit
sharing and/or retirement plan under 3(c), and vested interests in
incentive plans under 3(d) shall be paid within one hundred and
eighty (180) days of termination at the then Fair Market Value (as
hereinafter defined.)
(ii) any and all incurred and unreimbursed expenses pursuant to
Section 3(f). Such unreimbursed expenses shall be paid within thirty
(30) days of the receipt of expense report.
(iii) any and all benefits pursuant to section 3(e) for the benefit
of the Executive and Executive's family shall be continued for a
period of one hundred and eighty (180) days from the date of
termination.
(iv) the Company shall continue to provide Executive with long term
disability insurance, pursuant to Section 3(k) for so long as the
disability may continue.
(v) any and all incurred or future losses, claims, damages,
liabilities, expenses, judgments, fines, settlements or other
amounts arising from any and all claims, costs, demands, actions,
suits or other proceedings pursuant to Section 6. Such incurred
amounts shall be paid within thirty (30) days of termination; such
future amounts shall be paid within thirty (30) days of submission
of written claim by Executive to Company.
(vi) any and all obligations and provisions pursuant to Section 5
remain in effect.
All other obligations of the Company shall terminate upon the date
of termination.
(d) Cause. No termination for Cause, as hereinafter defined, shall take
place until the following: In the event the Board seeks to terminate
Executive for Cause, the Board shall give written notice to
Executive within ten (10) days of a meeting of the Board, during
which meeting the Executive and Executive's counsel shall have a
reasonable opportunity to address the Board. Such written notice
shall set forth in particularity the Board's proposed basis for
termination for Cause. Any resolution to terminate Executive for
Cause must be duly adopted by unanimous consent of the Board.
Termination shall be effective thirty (30) days after Executive
receives written notice of the Board's
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resolution to terminate Executive for Cause. For purposes of this
Section, "Cause" is defined as (i) Executive's fraud, willful
misconduct or gross negligence in connection with the performance of
his obligations under this Agreement or (ii) Executive's conviction
of, or plea of guilty to, a felony.
Upon termination for Cause, any and all obligations of the Executive
to the Company under Section 1 of this Agreement shall be
terminated. The Company shall continue to be obligated to the
Executive under this Agreement for the following:
(i) any and all earned and unpaid base salary, bonus, profit sharing
and/or retirement plan, vested interests under incentive plans, and
unused vacation time pursuant to sections 3(a), 3(b), 3(c), 3(d),
and 3(h) as of the date of termination. Such earned and unpaid
salary under 3(a) and unused vacation time under 3(h) shall be paid
within thirty (30) days of the date of termination. At the election
of the Executive, such earned and unpaid bonus under 3(b), profit
sharing and/or retirement plan under 3(c), and vested interests in
incentive plans under 3(d) shall be paid within one hundred and
eighty (180) days of termination at the then Fair Market Value (as
hereinafter defined.)
(ii) any and all incurred and unreimbursed expenses pursuant to
Section 3(f). Such unreimbursed expenses shall be paid within thirty
(30) days of the receipt of expense report.
(iii) any and all benefits pursuant to section 3(e) for the benefit
of the Executive and Executive's family shall be continued for a
period of one hundred and eighty (180) days from the date of
termination.
(iv) any and all incurred or future losses, claims, damages,
liabilities, expenses, judgments, fines, settlements or other
amounts arising from any and all claims, costs, demands, actions,
suits or other proceedings pursuant to Section 6. Such incurred
amounts shall be paid within thirty (30) days of termination; such
future amounts shall be paid within thirty (30) days of submission
of written claim by Executive to Company.
(v) any and all obligations and provisions pursuant to Section 5
remain i n effect.
All other obligations of the Company shall terminate upon the date
of termination.
(e) Resignation. Termination shall be effective five (5) days after
Company receives written notice of resignation from Executive,
delivered in person or by registered or certified mail. Such
resignation shall terminate any and all obligations of the Executive
to the Company under Section 1 of this Agreement. The Company shall
continue to be obligated to the Executive under this Agreement for
the following:
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(i) any and all earned and unpaid base salary, bonus, profit sharing
and/or retirement plan, vested interests under incentive plans, and
unused vacation time pursuant to sections 3(a), 3(b), 3(c), 3(d),
and 3(h) as of the date of termination. Such earned and unpaid
salary under 3(a) and unused vacation time under 3(h) shall be paid
within thirty (30) days of the date of termination. At the election
of the Executive, such earned and unpaid bonus under 3(b), profit
sharing and/or retirement plan under 3(c), and vested interests in
incentive plans under 3(d) shall be paid within one hundred and
eighty (180) days of termination at the then Fair Market Value (as
hereinafter defined.)
(ii) any and all incurred and unreimbursed expenses pursuant to
Section 3(f). Such unreimbursed expenses shall be paid within thirty
(30) days of the receipt of expense report.
(iii) any and all incurred or future losses, claims, damages,
liabilities, expenses, judgments, fines, settlements or other
amounts arising from any and all claims, costs, demands, actions,
suits or other proceedings pursuant to Section 6. Such incurred
amounts shall be paid within thirty (30) days of termination; such
future amounts shall be paid within thirty (30) days of submission
of written claim by Executive to Company.
(iv) any and all obligations and provisions pursuant to Section 5
remain in effect.
All other obligations of the Company shall terminate upon the date
of termination.
(f) Convenience of Company. The Company shall have the unilateral right
to terminate the employment of the Executive effective ninety (90)
days after receipt by Executive of written notice of termination,
delivered in person or by registered or certified mail. Such
termination shall terminate any and all obligations of Executive to
Company under Section 1 of this Agreement. The Company shall
continue to be obligated to the Executive under this Agreement for
any and all obligations for the remainder of the Term, including but
not limited to, the following:
(i) any and all base salary pursuant to Section 3(a); any and all
benefits pursuant to Section 3(e); the monetary value of the
automobile allowance pursuant to Section 3(g); the monetary value of
any and all vacation and holiday time pursuant to Section 3(h). Such
amounts under this paragraph 3(f)(1) shall be paid within thirty
(30) days of termination.
(ii) any and all bonuses pursuant to Section 3(b), such remaining
bonus amounts shall be calculated as follows: the ratio between such
remaining bonus amounts and remaining base salary amounts shall be
equal to the ratio between all past bonuses and past base salary
amounts. At the option of the Executive, such bonuses shall be paid
within thirty (30) days of termination.
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(iii) any and all profit sharing and/or retirement accounts pursuant
to Section 3(c), such remaining account amounts shall be calculated
as follows: the ratio between such remaining account amounts and
remaining base salary amounts shall be equal to the ratio between
all past account amounts and past base salary amounts. At the option
of the Executive, such accounts shall be paid or rolled over to a
new retirement account within thirty (30) days of termination.
(iv) any and all interests pursuant to Section 3(d) shall
immediately vest. At the option of the Executive, such interests
shall be paid within thirty (30) days of termination at the then
Fair Market Value (as hereinafter defined).
(v) any and all incurred or future losses, claims, damages,
liabilities, expenses, judgments, fines, settlements or other
amounts arising from any and all claims, costs, demands, actions,
suits or other proceedings pursuant to Section 6. Such incurred
amounts shall be paid within thirty (30) days of termination; such
future amounts shall be paid within thirty (30) days of submission
of written claim by Executive to Company.
(vi) any and all obligations and provisions pursuant to Section 5
remain in effect.
(vii) any and all other obligations of the Company to the Executive
shall remain in effect until the remainder of the Term.
Fair Market Value for purposes of this section shall be the then
fair market value as determined by an MAI appraiser, appointed by
both Executive and Company. In the event the Executive and Company
are unable to reach agreement as to one appraiser, each shall
appoint an appraiser, and one shall be appointed by the independent
public accounting firm of Xxxxxx Xxxxxxxx & Co. The Fair Market
Value shall be the average of the three appraisals. Fair Market
Value shall be calculated based on Executive's proportionate share
of the fair market value of the total outstanding shares without
regards to any minority discount. Costs shall be borne by the person
or persons appointing the appraiser. The cost of the appraiser
appointed by Xxxxxx Xxxxxxxx & Co. shall be equally shared by
Executive and Company.
5. Change in Control.
This Agreement survives any and all changes in control, including but not
limited to the following events:
(a) Company shall sell, assign, transfer or otherwise convey all or
substantially all of the assets of Company.
(b) Company shall merge or consolidate into a company or corporation and
Company shall not survive such merger or consolidation.
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(c) The ownership of Company shall alter or change by more that forty
percent (40%).
(d) The composition of the Board shall be changed by more than fifty
percent (50%).
6. Indemnification.
Company shall indemnify and hold harmless Executive from and against any and all
losses, claims, damages, liabilities, expenses (including legal fees and
expenses to be paid as incurred), judgments, fines, settlements and other
amounts arising from any and all claims, costs, demands, actions, suits or other
proceedings (whether civil, criminal, administrative or investigative) in which
Executive may be involved, or threatened to be involved as a party or otherwise.
(a) by reason of Executive's status as an officer and director of Company or (b)
which relate to the business of Company, its property or client relationships,
whether or not Executive continues in the capacity that entitled him to
indemnification at the time any such liability or expense is paid or incurred:
(i) so long as Executive acted in good faith and in a manner Executive
reasonably believed to be in or not opposed to the best interests of Company,
Company's business, property or clients, and with respect to any criminal
precedent, had reasonable cause to believe his conduct did not constitute
willful or wanton misconduct, fraud or gross negligence or (ii) to the extent
that Executive has been successful on the merits or otherwise in defense of any
action, suit or other proceeding, or in defense of any claim, issue or matter
raised therein. The termination of proceeding by judgment, order, settlement or
its equivalent, shall not, of itself, create a presumption that Executive did
not act in good faith and in a manner that Executive reasonably believed to be
in the best interests of Company.
Expenses incurred in defending a civil, criminal, administrative or
investigative action, suit or other proceedings shall be paid by Company in
advance of the final disposition of such proceeding if so requested by Executive
and upon the receipt of a written undertaking by or on behalf of Executive to
repay such amount if it shall ultimately be determined that Executive is not
entitled to be indemnified by Company.
The indemnification provided hereby shall be in addition to any other rights to
which Executive may be entitled under any agreement, as a matter of law or
otherwise, and shall continue to Executive after he has ceased to serve as an
officer or director hereunder and shall inure to the benefit of his respective
heirs, successors, assigns and administrators.
7. Non-competition Agreement.
If Executive's employment hereunder shall terminate for any reason, other than
as a result of a breach of this Agreement by Company, Executive agrees for a
period of three years after such termination not to engage in business in the
United States of America, as an employee, director, consultant, partner,
proprietor or shareholder (other than as a shareholder of a publicly traded
company owning less than five percent (5%) of the voting power of all shares of
said company entitled to vote) where such business shall be in competition with
business conducted by Company or any of its subsidiaries or affiliates during
the six months period prior to such termination and conducted by Company or any
or its subsidiaries or affiliates at the time such competitive activity shall be
undertaken by Executive.
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8. Confidential Information.
The Executive acknowledges that in his employment hereunder he occupies a
position of trust and confidence and agrees that he will treat as confidential
and, other than in the course of his duties as a director and officer of the
Company and affiliates, will not, without written authorization from the
Company, directly or indirectly disclose to any person, firm, association or
corporation or use for his own benefit or gain any confidential information,
plans, products, customer and/or supplier lists or any other trade secrets or
confidential material or information of the Company or any affiliate, where such
information, plans, products, lists or other trade secrets or confidential
material was or were learned by the Executive during the course of his
employment hereunder.
9. Equitable Relief
The Executive acknowledges and agrees that a breach by him of the provisions of
Section 7 or 8 hereof will cause the Company irreparable injury and damage which
cannot be compensated by money damages. The Executive therefore expressly agrees
that the Company shall be entitled to injunctive or other equitable relief to
prevent a breach of any provision of Section 7 or 8 of this Agreement and to
secure its enforcement in addition to any other remedies which may be available
to the Company.
10. Prior Employment.
Executive warrants and represents that he is under no contractual or legal
restrictions with respect to his obligations and duties hereunder and that his
employment will not violate any agreement or contract to which he is a party or
by which he is bound. Executive shall indemnify and save Company harmless from
any damages or injury Company might sustain as a result of the violation of this
Section 10 (including actual, reasonable attorney's fees).
11. Miscellaneous.
(a) Amendment. This Agreement may be amended or modified from time to
time, but only by a written instrument executed by both parties
hereto.
(b) Notices. Any notices required or permitted hereunder shall be in
writing and shall be deemed given when personally delivered or when
sent by registered or certified mail, postage prepaid, return
receipt requested, addressed to the other party at its or his
address set forth below its or his signature to this Agreement, or
at such other address as it or he may specify from time to time by
notice hereunder.
(c) Entire Agreement This Agreement contains the entire understanding of
the parties hereto with respect to the subject matter hereof and
supersedes all prior or contemporaneous discussions or
understandings with respect to the subject matter.
(d) Successors and Assigns. This Agreement is a personal services
contract and shall require the personal services of Executive but
shall
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otherwise be binding upon and shall inure to the benefit of the
parties hereto and their respective heirs, executors,
administrators, legal representatives, successors and assigns.
(e) Governing Law. This Agreement shall be governed by and constructed
in accordance with the laws of the State of California.
(f) Jurisdiction. Any matters arising hereunder or related to this
Agreement that may be litigated, shall be litigated only in courts
having sites with the City of Los Angeles. The parties hereto hereby
consent to and submit to the jurisdiction of any local, state or
federal court located in Los Angeles, California. All parties hereto
hereby waive any right they may have to transfer or change the venue
of litigation brought against any of them by other parties hereto
relating to this Agreement.
(g) Non-waiver of Breach. A waiver by any party hereto of a particular
breach or default in connection with any provision of this Agreement
shall not be deemed a waiver of any subsequent default or breach of
the same or any other provision of this Agreement.
(h) Invalid Provision. If any provision of this Agreement is held to be
illegal, invalid, or unenforceable under present or future laws,
such provision shall be severable, and the remaining provisions of
this Agreement shall remain in full force and effect and shall not
be affected by such illegal, invalid, or unenforceable provision or
by its severance herefrom.
(i) Captions. The captions in this Agreement are for purposes of
reference only and shall not be considered in construing this
Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
COMPANY:
STATMON TECHNOLOGIES CORP.
BY:
--------------------------------------
Xx. Xxxxx Xxxxxx
Vice Chairman
000 X. Xxxxxx Xxxxx
Xxx Xxxxxxx , XX 00000
EXECUTIVE:
--------------------------------------
Xx. Xxxxxxxx Xxxxxx
000 X. Xxxxxx Xxxxx
Xxx Xxxxxxx, XX 00000
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FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
THIS FIRST AMENDMENT TO EMPLOYMENT AGREEMENT (this "Amendment") is made as
of July 1, 2004, by and among STATMON TECHNOLOGIES CORP., a Nevada corporation (
"Company") and XXXXXXXX XXXXXX ("Executive").
Statement of Facts
A. Company and Executive are parties to that certain Employment Agreement
dated as of September 17, 2000 (the "Employment Agreement").
B. Despite the date the Employment Agreement was executed, the Employment
Agreement's commencement date was delayed until certain conditions (the "Loan
Conditions") contained in certain loan agreements to which Company was bound
were satisfied.
C. As of July 1, 2004, the Board of Directors of Company has determined
that Company has satisfied the Loan Conditions (the "New Commencement Date").
D. All services rendered by Executive prior to the New Commencement Date
were categorized as consulting services and all compensation paid to Executive
for such services was deemed to be consulting fees.
E. The parties desire to amend the Employment Agreement to reflect the
foregoing events.
NOW, THEREFORE, in consideration of the premises, the covenants and
agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
Statement of Terms
1. Amendment to Employment Agreement. Subject to the terms and conditions
of this Amendment, the Employment Agreement is hereby amended as follows:
(a) The Statement of Facts above are hereby incorporated into and
made a part of the Employment Agreement.
(b) Section 2 of the Employment Agreement is hereby amended and
restated to read as follows:
"2. Term.
The term of Executive's employment hereunder shall be for a period
commencing July 1, 2004 and ending July 1, 2009."
(c) Section 3(a) of the Employment Agreement is hereby amended and
restated to read as follows:
"3. Compensation.
(a) Base Salary. During the Term, Executive shall receive a base
minimum salary payable in equal semi-monthly installments at an annual rate for
the First Year of $160,000 and the Second Year of $200,000. For years three,
four and five of the employment agreements, annual salary increases, performance
and incentive bonuses including the issuance of stock options, are to be
negotiated and approved by the Compensation Committee on an annual basis
immediately prior to the Company filing the previous years Form 10K or June 30
whichever event occurs first.
2. Consent. Company hereby acknowledges Executive is entitled to the Base
Salary specified in Section 3(a) of the Employment Agreement, subject to any
performance thresholds specified therein.
3. No Other Amendments. Except for the amendments expressly set forth in
this Amendment, the Employment Agreement shall remain unchanged and in full
force and effect.
4. Counterparts. This Amendment may be executed in multiple counterparts
and via facsimile, each of which shall be deemed to be an original and all of
which when taken together shall constitute one and the same instrument.
5. Governing Law. THIS FIRST AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF CALIFORNIA APPLICABLE TO
CONTRACTS MADE AND PERFORMED IN SUCH STATE.
6. Binding Effect. This Amendment shall be binding upon and shall inure to
the benefit of the parties hereto and their respective successors and assigns.
IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to
Employment Agreement to be duly executed and delivered as of the day and year
specified at the beginning hereof.
EXECUTIVE:
XXXXXXXX XXXXXX
COMPANY:
STATMON TECHNOLOGIES CORP.
By:
Name: Xxxxx Xxxxxx
Title: Vice Chairman
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