EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as of
the 1st day of November 2004 by and among
Vitalstate US Inc.
0000 Xxxx Xxxxx Xxxx
Xxxxxxx Xxxxx,
Xxxxxxx 00000,
(the "Corporation")
And
Xxxx Xxxxxxxx
0000 Xxxxxxxxx Xxxx.
Xxxx Xxxxx, Xxxxxxx 00000
(the "Executive")
WHEREAS the Corporation is engaged in the business of the creation,
production, sale and marketing of nutraceuticals (thereinafter the "Business");
WHEREAS the Corporation wishes to employ the Executive as Chief Financial
Officer ("CFO") and the Executive agrees to be so employed, in accordance with
terms, covenants and conditions thereinafter set forth;
NOW, THEREFORE, FOR THE REASONS SET FORTH ABOVE, AND IN CONSIDERATION OF
THE MUTUAL PREMISES AND AGREEMENTS HEREINAFTER SET FORTH, THE PARTIES HERETO
ACKNOWLEDGE AND AGREE AS FOLLOWS:
1. NATURE AND TERM OF SERVICES
1.1 The Corporation hereby employs, engages and hires the Executive as CFO of
the Corporation, and the Executive hereby accepts and agrees to such hiring,
engagement and employment.
1.2 Nature of Services. The Executive agrees that she shall provide her services
to the Corporation on a full-time basis, the whole according to the terms and
conditions hereinafter set forth, as an Executive to the Corporation, and her
duties as such an Executive shall include oversight and responsibility of all
finance and accounting related activities, including those activities handled by
outside professionals and as set forth from time to time by the Corporation's
board of directors. The services to be performed by the Executive hereunder
shall be principally performed from the Corporation headquarters based in
Boynton Beach, Florida. reporting directly to the CEO/President. However, it is
further understood by all parties that the Executive may indeed exercise her
right to move with her family outside of South Florida, thereinafter she will
fulfill her duties full time from a home-based office reporting through the
Corporate headquarters in Florida directly to the CEO/President. This potential
move will in no way cause effect on any other terms or condition of this
Agreement.
In her capacity as Chief Financial Officer of the Corporation, the Executive
shall perform all of the duties and have all of the obligations as may be
provided and determined in the Articles of Incorporation and Bylaws of the
Corporation, as the same may be amended from time to time, and as may be
determined by the Board and the Executive Committee. Throughout her employment,
the Executive shall devote all of her time, energy and skill during regular
business hours to the performance of the duties of her employment by the
Corporation (reasonable vacation time and reasonable absences due to illness
excepted), shall faithfully and industriously perform such duties, and shall
diligently follow and implement all management policies and decisions of the
Corporation.
1.3 Term. The initial term of this Agreement (the "Term") shall commence
November 1, 2004 and shall continue through December 31, 2004. The term of this
Agreement shall automatically renew for successive one (1) year terms unless
terminated sooner as provided in Section 4 below. The Term shall be renewable,
at the option of the Executive and the Corporation as per mutually agreed upon
terms, including any extensions thereof, is subject to earlier termination as
provided herein.
2. COMPENSATION
2.1 Salary. In consideration for the Services to be rendered pursuant to
this Agreement, and in further consideration for the confidentiality,
non-competition and non-solicitation covenants described in Article 3 thereof,
the Corporation shall pay the Executive an initial base annual salary of
USD$150,000 per annum (hereinafter the "Salary") subject to the normal
deductions at source, payable in semi-weekly installments. During the Term, the
annual base Salary shall be reviewed periodically by the Corporation for
possible increase.
Thereafter, any increases to the Base Salary shall be decided, effective
on January 1st of each calendar year, beginning on January 1, 2005. The first
year Base Salary increase shall be determined based upon mutual agreement
between the Executive and the Executive Committee and shall consider such
factors as the successful capitalization of the Company. For future years, it is
understood that normal and customary Base Salary increases may occur once
business conditions improve, but shall not be less than the increase in the
Consumer Price Index during such successful periods.
Executive will also be entitled to 4 weeks paid vacation per year / 1 week paid
sick time and 2 paid personal days yearly. Vacation time is to be authorized /
approved in advanced by CEO / President.
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2.2 Bonus. The Executive shall be eligible to receive, but shall not be required
to receive, an annual bonus (the "Bonus") based upon certain performance
parameters against [a plan to be mutually agreed upon by the Executive Committee
and the Executive] from time to time. Each Bonus shall correspond to the
calendar year and shall be paid to the Executive in one lump sum, subject to
deductions and withholding as provided in Section 2(a) above, during the
calendar year immediately following the calendar year to which the Bonus
relates. [The Executive Committee, in its discretion, shall determine the amount
of the Executive's Bonus, if any, and the method of determining eligibility
2.3 Other Benefits. Executive will receive a benefit program paid for 100% by
the Corporation, that includes health insurance (with vision care), and dental
insurance. The Executive will also be eligible to participate any other benefit
plans offered through the Corporation including but not limited to, life
insurance, pension plans, retirement or other benefit plans adopted by the
Corporation for the general and overall benefit of all Executives of the
Corporation.
2.4 Expense Reimbursement. The Corporation will reimburse the Executive for all
documented and approved expenses incurred by the Executive in the performance of
his duties under this Agreement, to be paid in accordance with the Corporation's
practices in effect from time to time. The Corporation will at their sole
expense supply a computer for use in the home office and other necessary office
hardware (which will remain the property of the Corporation should this
agreement expire or be terminated, at which point the executive will be
responsible to return the computer to the Corporation).
2.5 Professional Company Membership Dues and Expenses. If desired by the
Executive, and as a benefit to the Corporation, the Corporation shall pay for
the Executive's expenses of membership, receipt of publications, and other
participation in the relevant programs and activities.
3. CONFIDENTIAL INFORMATION, NON-COMPETITION, AND HOLD HARMLESS
3.1 Definition of Confidential Information. For the purposes of this Agreement,
the term "Confidential Information" shall mean, but shall not be limited to, any
technical or non-technical data, formulae, patterns, compilations, programs,
patents, trade secrets, devices, methods, techniques, drawings, designs,
processes, procedures, improvements, models, experimental work, manuals,
financial data, financial information, business forecast information, cash
requirement information, organization information, valuation information,
technical information, scientific information, research information, lists of
actual or potential customers or suppliers, of the Corporation and any
information regarding any of the Corporation's marketing, sales or dealer
network, which is not generally known to the public through legitimate origins.
The Corporation and the Executive acknowledge and agree that such Confidential
Information is extremely valuable to the Corporation. In the event that any part
of the Confidential Information becomes generally known to the public through
legitimate origins (other than by breach of this Agreement by the Executive),
that part of the Confidential Information shall no longer be deemed Confidential
Information for the purposes of this Agreement, but the Executive shall continue
to be bound by the terms of this Agreement as to all other Confidential
Information.
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3.2 Non-Disclosure of Confidential Information. Unless otherwise required by law
or expressly authorized in writing by the Corporation, the Executive shall not,
at any time during or after the Term, directly or indirectly, in any capacity
whatsoever, except in connection with services to be performed hereunder,
divulge, disclose or communicate to any person, moral or physical, entity, firm
or any other third party, or utilize for the Executive's personal benefit or for
the benefit of any competitor of the Corporation, any Confidential Information.
3.3 Delivery Upon Termination. Confidential Information and all embodiments
thereof (including any information on computer disk and any reproductions) shall
remain the sole property of the Corporation, and immediately upon request to
this effect or immediately upon termination of this Agreement for any reason,
the Executive shall promptly deliver to the Corporation all correspondence,
drawings, manuals, letters, notes, notebooks, reports, programs, plans,
proposals, financial documents, or any other documents concerning the
Corporation's customers, dealer network, marketing strategies, products and/or
processes which contain Confidential Information.
3.4 Covenant Not To Compete. During the Term (as previously defined in 1.3), the
Executive shall not, on his own behalf or on behalf of another, either alone or
in combination with others, directly or indirectly, in any capacity whatsoever
(including, without limitation, as an Executive, employer, principal, agent,
joint venture, partner, shareholder or other equityholder, independent
contractor, licensor, licensee, franchisor, franchisee, distributor, consultant,
supplier or trustee):
(i) engage anywhere in Canada and the United States of
America (hereinafter the "Territory") in any aspect of
the Business for purposes which are competitive with the
Business as conducted by the Corporation;
(ii) have any ownership or equity interest in any business,
firm, corporation, joint venture, partnership or other
entity engaged in any aspect of the Business in the
Territory (other than 5% or less of a publicly traded
Corporation); or
(iii) consult with or assist any person, moral or physical
(other than the Corporation) who or which is engaged in
any aspect of the Business in the Territory for purposes
which are competitive with the Business as conducted by
the Corporation.
3.5 Covenant of Non-Solicitation. During the Term (as previously defined in
1.3), the Executive shall not, on his own behalf or on behalf of another, either
alone or in combination with others, directly or indirectly, in any capacity
whatsoever (including, without limitation, as an Executive, employer, principal,
agent, joint venturer, partner, shareholder, or other equityholder, independent
contractor, licensor, licensee, franchisor, franchisee, distributor, consultant,
supplier or trustee):
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(i) solicit or assist any third party to solicit any
Executives of the Corporation to become an officer,
director, Executive or agent of the Corporation or such
third party, or otherwise entice away from the
employment of the Corporation any Executive of the
Corporation; or
(ii) (a) canvass or solicit (or procure or assist the
canvassing or the soliciting of) any customer of the
Corporation for purposes which are competitive with the
Business as conducted by the Corporation; or
(b) accept (or procure or assist the acceptance of) any
business from any customer of the Corporation for
purposes which are competitive with the Business as
conducted by the Corporation.
3.6 Assignment of Consultation Inventions. The Executive shall disclose and
assign to the Corporation any and all materials of a proprietary nature,
including, but not limited to, material subject to protection as Confidential
Information, trade secrets or as patentable or copyrightable ideas, which the
Executive may conceive, invent, create or discover, either solely or jointly
with another or others, during the Term, in connection with the rendering of
Services hereunder and which relates to or is capable of use in connection with
the business of the Corporation or any services or products offered, performed,
produced, used, sold or being developed by the Corporation at the time said
material is developed as it pertains to Vitalstate.
3.7 Additional Documentation. The Executive will, upon request of the
Corporation, either during or at any time after the termination of this
Agreement, execute and deliver all papers, including applications for patents or
copyrights, and do such other acts (solely at the Corporation `s expense) as may
be necessary to obtain and to maintain proprietary rights in the Confidential
Information specified in Section 3.6 above and the materials specified in
Section 3.6 above, in any and all countries and to vest title thereto in the
Corporation.
3.8 Other Remedies. In the event that the Executive breaches any of the terms
contained in this Section 3, the Executive stipulates that said breach will
result in immediate and irreparable harm to the business and goodwill of the
Corporation and that damages, if any, and remedies at law for such breach would
be inadequate. In addition to any and all such remedies available to the
Corporation, the Corporation shall therefore be entitled to apply for and
receive from any court of competent jurisdiction an injunction to restrain any
violation of this Agreement and for such further relief as the court may deem
just and proper.
3.9 Hold Harmless. The Company agrees to hold harmless the CFO from any and all
liability, including claims, demands, losses, costs, damages, and expenses of
every kind and description (including death), or damages to persons or property
arising out of or in connection with or occurring during the course of this
agreement where liability is founded upon and grows out of the acts or omissions
of any of the officers, employees or agents of the Company while acting within
the scope of their employment where protection is afforded by Federal, State,
and/or local law.
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3.10 Continuing Obligations. The obligations, duties and liabilities of the
Executive pursuant to Section 3 of this Agreement are continuing, absolute and
unconditional and shall remain in full force and effect as provided therein
despite any termination of this Agreement for any reason whatsoever, including,
but not limited to, the expiration of the Term.
4. TERMINATION
4.1 Termination for Cause; Death or Disability of Executive. In the event of a
material breach by the Executive under this Agreement, or upon his death or
permanent disability such that the Executive cannot perform the Services
hereunder, this Agreement may be terminated by the Corporation without notice or
penalty. Notwithstanding the foregoing, any Salary earned by the Executive prior
to such termination, death or disability shall remain payable by the Corporation
to the Executive or his estate. For purposes of this Agreement, permanent
disability means the Executive has been unable, for three consecutive months, to
perform the Executive's duties under this Agreement, as a result of physical or
mental illness or injury.
4.2 Termination by Executive. This Agreement may be terminated immediately if
the Corporation is no longer capitalized with a 30 day written notice to the
Corporation by the Executive, or at any time by the Executive upon three (3)
months prior written notice to Corporation.
4.3 Termination by Corporation without Cause or Resignation with Good Reason.
Executive will be deemed to have "good reason" to resign in the event: (A) A
reduction in Executive's responsibilities or duties. (B) A material breech by
the Corporation of its obligations, under Section 2 of this agreement occurs (C)
Change in control as defined in Section 4.4 of this agreement. In the event this
Executive's employment is voluntarily terminated by the Corporation without
cause, for any reason whatsoever or by the Executive's resignation with good
reason during the Term, the Corporation shall (i) continue to pay Executive an
amount equivalent to his base salary, payable bi-monthly for the duration of the
Term.
4.4 Termination Following a Change in Control. In the event this Agreement is
terminated by the Corporation pursuant to a change in control of Vitalstate
Inc., the Corporation shall (i) continue to pay Executive an amount equivalent
to his base salary, payable bi-monthly for the duration of the Term.
5. MISCELLANEOUS
5.1 Assignment. Except as provided in this Section 5.1, the Executive and the
Corporation acknowledge and agree that the covenants, terms and provisions
contained in this Agreement and the rights of the parties hereunder cannot be
transferred, sold, assigned, pledged, or hypothecated; provided, however that
this Agreement shall be binding upon and shall ensure to the benefit of the
Corporation and any successor to or assignee of all or substantially all of the
business and property of the Corporation. In addition, the Corporation may
assign its rights hereunder to a direct or indirect subsidiary, affiliated
Corporation, or division of the Corporation without the consent of the
Executive.
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5.2 Capacity. The Executive hereby represents and warrants that, in entering
into this Agreement, she is not in violation of any contract or agreement,
whether written or oral, with any other person, moral or physical, firm,
partnership, corporation or any other entity to which she is a party or by which
she is bound and will not violate or interfere with the rights of any other
person, firm, partnership, corporation or other entity.
5.3 Entire Agreement. This Agreement contains the entire agreement between the
parties and shall not be modified except in writing by the parties hereto.
Furthermore, the parties hereto specifically agree that all prior agreements,
whether written or oral, relating to the Services to the Corporation shall be of
no further force or effect from and after the date hereof.
5.4 Severability. If any phrase, clause or provision of this Agreement is
declared invalid or unenforceable by a court of competent jurisdiction, such
phrase, clause or provision shall be deemed severable from this Agreement, but
will not effect any other provisions of this Agreement, which otherwise shall
remain in full force and effect. If any restriction or limitation in this
Agreement is deemed to be unreasonable, onerous and unduly restrictive by a
court of competent jurisdiction, it shall not be stricken in its entirety and
held totally void and unenforceable, but shall remain effective to the maximum
extent permissible within reasonable bounds.
5.5 Waiver. The waiver by the Corporation or the Executive of any breach of any
term or condition of this Agreement shall not be deemed to constitute the waiver
of any other breach of the same or any other term or condition hereof.
5.6 Governing Law. The parties hereto agree that this Agreement shall be
construed as to both validity and performance and shall be enforced in
accordance with and governed by the laws of New York applicable therein.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
VITALSTATE US INC.
By:
------------------------------------------
Name: Xxxxx X. Xxxxx
Title: President and Chief Executive Officer
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Name: Xxxx Xxxxxxxx
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