EXHIBIT 10.3
EMPLOYMENT AGREEMENT
This Employment agreement (the "Agreement") is made this 9th
day of June, 1997, by and between Comparator Systems Corporation,
a Colorado corporation (the "Company"), and XXXX X. XXXXXXXXXXXXX
(the "Employee").
In consideration of the mutual covenants and agreements herein
contained, and in accordance with the authorization of the Board of
Directors of the Company, the Company and the Employee hereby agree
as follows:
1. SERVICES TO BE RENDERED. The Company hereby retains the
Employee to provide services to the Company, and the Employee
hereby agrees to render such services under the terms of this
Agreement. The Employee shall perform the duties of Executive Vice
President, Secretary and Treasurer.
2. TERM OF AGREEMENT. Subject to the provisions for
termination hereinafter provided, the term of this Agreement
shall be effective JUNE 1, 1997, until MAY 30, 2000. The parties
hereto agree to enter into good faith negotiations for the
purpose of extending the term of this Agreement on or about 90
days prior to the expiration of the term hereof, unless, at such
time, the agreement has been or is being terminated.
3. SERVICES. The Employee shall devote time, attention
and ability to the proper and efficient conduct of his duties
hereunder. Except as set forth in Paragraph 10 below, nothing
herein shall be deemed to prevent the employee from serving any
other enterprise in any capacity, nor shall this Agreement be
construed as preventing the Employee from investing his assets in
such form or manner as will require any services on the part of
the Employee in the operation and the affairs of the companies or
entities in which such investments are made.
4. AUTOMOBILE ALLOWANCE. During the term hereof, the
Company shall provide the Employee with a reasonable automobile
allowance in accordance with the allowance schedule for the
position filled by the Employee.
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5. COMPENSATION: EXPENSES.
(a) For the services rendered by the Employee during
the term hereof, the Company shall pay to the Employee a base
compensation at an annual rate of: for the period June 1, 1997 to
May 30, 1998 $120,000; for the period June 1, 1998 to May 30,
1999 $160,000; for the period June 1, 1999 to May 30, 2000
$200,000; or at such higher rate as may be fixed from time to
time by the Board of Directors, payable in equal bi-monthly
installments beginning at the end of the first month. The
Employee shall also be entitled to the additional compensation
set forth in Schedule I hereto and to such bonuses as shall be
determined from time to time by the Board of Directors, in its
sole discretion.
(b) The Employee shall be authorized to incur
reasonable expenses incident to the maintenance or promotion of
the business of the Company, such as expenses for entertainment,
travel, and similar items, and shall be reimbursed by the Company
for such expenses upon presentation of a statement of such
documented expenditures, in accordance with the Company's current
operating procedure.
6. TERMINATION BY THE COMPANY. During the term of this
Agreement, the Company shall have the following right to
terminate this Agreement, subject to Paragraph 7 below:
(a) TERMINATION FOR CAUSE: The Company shall have the
right to terminate this agreement for cause upon 30 days written
notice if the Employee shall have (i) been proven to have caused
the Company to suffer injury as a result of any fraud or willful
or wanton misconduct of Employee during the course of the
performance of, or otherwise related to his or her duties
hereunder, or (ii) been convicted of a felony.
(b) TERMINATION FOR DISABILITY: The Company shall have
the right to terminate this Agreement upon 30 days written notice
if the Employee shall have been unable, as a result of physical
illness or other incapacity, to substantially perform his or her
duties hereunder for a continuous period of six months or longer.
(c) RESIGNATION: Resignation of the Employee shall
terminate this Agreement.
7. TERMINATION BENEFITS. In the event that this Agreement
is terminated by the Company pursuant to Paragraph 6, the Company
shall pay the Employee or his or her estate the following sums,
or the following consequences shall follow, as the case may be:
(a) If this Agreement is terminated by the Company for
cause pursuant to Paragraph 6(a), then (i) the Company's
obligation to compensate the Employee pursuant to Paragraph 5(a)
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shall cease as of the date of termination, and (ii) the Company
shall not be required to reimburse the Employee pursuant to
Paragraph 5(b) for expenses incurred after the date of
termination.
(b) If this Agreement is terminated by the Company for
disability pursuant to Paragraph 6(b), the Company shall pay the
Employee a disability benefit at an annual rate of 75% of the
Employee's annual base compensation in effect at the time of
termination pursuant to Paragraph 5(a) (excluding additional
compensation and bonuses), payable in equal monthly installments,
such disability benefit to continue until the earlier to occur of
the expiration of two years after the date of termination or the
death of the Employee.
(c) In the event that the Employee shall die during
the term of this Agreement, the Company agrees to pay to the
Employee's widow or widower, as the case may be, estate, or any
other person designated in writing by the Employee an amount
equal to 75% of the Employee's annual base compensation in effect
at the time of death pursuant to paragraph 5(a) (excluding any
additional compensation or bonuses). Such payment shall be made
in 6 equal monthly installments.
(d) If this Agreement is terminated by the Company for
any reason other than cause (Paragraph 6(a), or disability
(Paragraph 6 (b), or death (Paragraph 6 (d)), the Employee shall
be entitled, at his or her option, to payment of a Sum equal to
the aggregate remaining payments due the Employee pursuant to
this Agreement, until expiration of the term thereof, computed on
the basis of the annual base compensation in effect at the time
of termination, determined pursuant to Paragraph 5(a), (referred
to herein as the "Termination Amount"), payable in a lump sum
equal to the discounted present value of the Termination Amount,
using a discount rate equal to the sum of the prime rate reported
in the "Money Rates" column of the Wall Street Journal (Western
Edition) on the date the termination becomes effective, payable
within 30 days after the date on which the termination becomes
effective.
8. VACATION: The Employee shall be entitled to a paid
vacation of two weeks per year, for the first year and thereafter
a paid vacation of three weeks which if unused, may be carried
over and accrued at the election of the Employee. If, upon
Employee's termination, regardless of cause, Employee has accrued
vacation which has not been taken, then Employee shall be paid
therefore, at the full compensation rate then in effect.
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9. ADDITIONAL BENEFITS.
(a) The Company agrees to obtain, and to place in
effect as soon a practicable, and to pay for (i) health insurance
(including dental and eye care coverage) for the benefit of the
Employee and his or her immediate dependents, consistent with the
coverage provided by the Company to other employees of the same
level, and (ii) term life insurance, payable to Employee's
beneficiary or estate, in an amount equal to three times the
annual compensation as in 5(a).
(b) The Company agrees, subject to Board of Directors
approvals, to provide an annual stock option program for Employee
consistent with that provided to other employees of the same
level.
10. CONFIDENTIAL INFORMATION AND COVENANT NOT TO COMPETE.
(a) The Employee hereby agrees that, during the term
of this Agreement and thereafter, he or she will not disclose to
any person, or otherwise use or exploit any of the proprietary or
confidential information or knowledge, including without
limitation, trade secrets, processes, records of research,
proposals, reports, methods, processes, techniques, computer
software or programming, customer lists, or budgets or other
financial information, regarding the Company, its business,
properties or affairs obtained by him or her at any time prior to
or subsequent to the execution of this Agreement, except to the
extent required by his performance of assigned duties for the
Company.
(b) Upon termination of this Agreement, the Employee
will deliver to the Company all tangible displays and
repositories of trade secrets, processes, records of research,
proposals, reports, memoranda, methods, processes, techniques,
computer software and programming, customer lists, or budgets or
other financial information, and other materials or records or
writings of any other type (including any copies thereof) made,
used or obtained by the Employee in connection with this
Agreement.
(c) The Employee hereby agrees that during the period
from the date hereof through and including one year after the
expiration of the term hereof, he or she will:
(i) neither authorize his or her name to be used
by,
(ii) nor engage in or carry on, directly or
indirectly, for himself, as a member of partnership, as a
controlling stockholder, officer or director of a corporation
(other that the Company or any successor of the Company), or as
an employee, agent, associate or consultant of any person,
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partnership, corporation (other than the Company or any successor
of the Company) or other business entity, any business in
competition with any business carried on or conducted, directly
or indirectly, by the Company prior to the date hereof or
hereafter, in the Counties of Orange or Los Angeles of the State
of California or any other county where business is then carried
on or conducted by the Company.
(d) The Employee agrees that the remedy at law for any
breach by him of any of the covenants and agreements set forth in
this Paragraph 10 will be inadequate and that in the event of
such any such breach, the Company may, in addition to other
remedies which may be available to it at law, obtain injunctive
relief prohibiting him (together with all those persons
associated with him) from the breach of such covenants and
agreements.
(e) The parties hereto intend that the covenants and
agreements contained in this Paragraph 10 shall be deemed to
include a series of separate covenants and agreements. If any
judicial proceeding or court shall refuse to enforce all of the
separate covenants deem included in such action, then such
unenforceable covenants shall be deemed eliminated from the
provisions hereof for the purposes of such proceeding to the
extent necessary to permit the remaining separate covenants to be
enforced in such proceeding.
11. NOTICES. All Notices and other communications
permitted or required hereunder shall be in writing and shall be
deemed to have been duly given when delivered, or two days after
having been mailed by registered or certified mail, postage
prepaid, return receipt requested:
(a) If to Employee, addressed to him or her at: 00
Xxxxxxxxx Xxxx Xxxxx X-000, Xxxxxx, XX 00000
(b) If to the Company, addressed to it at: 00
Xxxxxxxxx Xxxx Xxxxx X-000, Xxxxxx, XX 00000
or such other address as either party hereto may designate by
written notice to the other 5 pursuant to this Paragraph.
12. THE ENTIRE AGREEMENT. This agreement constitutes and
embodies the full and complete understanding and agreement of the
parties hereto and supersedes all prior understandings or
agreements, oral or written, whether or not related to the
subject matter hereof.
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IN WITNESS WHEREOF, the parties hereto have executed this
agreement on the day first written above.
COMPARATOR SYSTEMS CORPORATION
/s/ Xxxxxx X. Xxxxxxxx
--------------------------------
Xxxxxx X. Xxxxxxxx
Its duly authorized
President and
Chief Executive Officer
/s/ Xxxx X. Xxxxxxxxxxxxx
--------------------------------
Xxxx X. Xxxxxxxxxxxxx
EMPLOYEE
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SCHEDULE I
ADDITIONAL COMPENSATION
Employee, by virtue of agreeing to the above employment agreement
shall receive the following shares of stock over the period
indicated as a signing bonus. Said shares to be issued to
employee at such time as the shares are available in the form
available, and without cost to the employee. This signing bonus
is to be paid regardless of the employment status of the employee
with the company. This schedule shall be met as to the time and
shares without regard to the current price of the Company's
stock.
During months one 500,000 shares
through six per month 3,000,000 shares
During months six 1,000,000 shares
through twelve per month 6,000,000 shares
During months twelve 1,500,000 shares
through eighteen per month 9,000,000 shares
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