EMPLOYMENT AGREEMENT
EXHIBIT
10.8
THIS EMPLOYMENT AGREEMENT (this
“Agreement”), dated as of August 4, 2009, is made by and between:
TaxMasters, Inc., a Nevada
corporation (formerly known as Crown Partners, Inc.) having its principal office
at 000 Xxxx & Xxxxxxx Xxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000
(hereinafter referred to as "EMPLOYER")
AND
Xxxxxxxxx X. Xxxxxxx, an adult
individual residing at 0000 Xxxx Xxxxx Xxxxx, Xxxxx Xxxx, Xxxxx 00000
(hereinafter referred to as "EMPLOYEE")
WITNESSETH
THAT:
(b) This
Agreement shall supersede and replace all prior discussions, negotiations,
memoranda, correspondence, understandings, and agreements pertaining to the
employment of EMPLOYEE by EMPLOYER and/or its subsidiary.
(b) This
Agreement, subject to the provisions of Paragraphs 15 and 16 below, shall
continue and exist for an initial period from such effective date until December
31, 2012 (initial term). The term “employment year” as used in this
Agreement shall mean January 1 to December 31, which is the EMPLOYER’s fiscal
year.
(c) If,
on November 30, 2012, neither party is then in default under this Agreement,
EMPLOYER shall have the option to extend the term of this Agreement for an
additional one (1) year period. Such option shall be exercised by
EMPLOYER mailing notice to EMPLOYEE, on or before December 1, 2012, of its
intention to so extend the Agreement. If EMPLOYER shall not exercise
its extension option on or before December 1, 2012 this Agreement shall
terminate as provided herein.
(d) This
Agreement shall be subject to a further one (1) year extension under the
procedure provided in subparagraph (c), provided that on November 30 of the then
existing extension year neither party is then in default under this Agreement
and notice of exercise of the extension option is given by EMPLOYER to EMPLOYEE
on or before December 1 of such extension year.
(e) Notwithstanding
the foregoing, the term of this Agreement is otherwise subject to the various
termination provisions contained hereafter.
(b) At
the end of each fiscal year, the EMPLOYER's Board of Directors shall review the
performance of EMPLOYEE for such year and, based upon such evaluation, establish
any increase in the base compensation payable to EMPLOYEE for the succeeding
fiscal year. EMPLOYER shall not be obligated to provide any increase;
however, any increase shall supersede the “floor” in subparagraph
(a).
(c) During
each fiscal year during the term of this Agreement, EMPLOYEE shall be entitled
an annual cash bonus equal to a maximum of Twenty Percent (20%) of EMPLOYEE’s
base annual salary. Such bonus shall be paid quarterly within sixty
(60) days after the end of each fiscal quarter. Each such quarterly
bonus payment shall not be greater than Five Percent (5%) of EMPLOYEE’s base
annual salary in effect for such fiscal year. The amount of each
quarterly cash bonus payment shall be determined by EMPLOYER’s Board of
Directors subject to the limitations set forth in this subparagraph (c).
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(b) The
certificates for such bonus shares shall bear a legend on the face thereof
indicating that such shares (i) have not vested and cannot be sold, transferred,
assigned or otherwise disposed of until and unless they have vested and (ii)
have not been registered under the Securities Act of 1933 and are restricted as
to further transfer.
(c)
During the initial term, EMPLOYEE shall be eligible for a grant of stock options
under EMPLOYER’s 2009 Stock Option Plan as follows: (i) Two Million
Five Hundred Thousand (2,500,000) options at the end of fiscal 2009, (ii) One
Million (1,000,000) options at the end of fiscal 2010 and (iii) One Million
(1,000,000) options at the end of fiscal 2011. In the event that
Earnout Shares are issued with respect to 2009, 2010 and/or 2011 to EMPLOYER’s
Chief Executive Officer, Xxxxxxx X. Xxx, under that certain Share Exchange
Agreement, dated as of August 4, 2009, by and among EMPLOYER, Xx. Xxx,
TaxMasters, Inc. and certain former shareholders of EMPLOYER named therein, then
the option grants to EMPLOYEE for 2009, 2010 and 2011 shall be increased in the
same proportion as the number of Earnout Shares issued to Xx. Xxx for the
respective fiscal year bears to the total number of Earnout Shares issuable
under Section 5.1 of the Share Exchange Agreement. All options
granted to EMPLOYEE pursuant to this paragraph 5(c) shall have a three (3) year
term and shall vest immediately upon grant. EMPLOYEE shall be
eligible for such other option grants under EMPLOYER’s 2009 Stock Option Plan as
determined in the discretion of EMPLOYER’s Board of Directors.
(a) Base
Personal Leave - During each year of this Agreement, EMPLOYEE shall receive
twenty (20) days paid personal leave, which shall not be accumulated from year
to year if unused. EMPLOYEE shall not be compensated for any unused personal
leave. "Personal leave" shall include vacation, sick leave,
bereavement leave, so-called “personal days” and all other personal time off,
other than legal holidays in the State of Texas.
(b) Medical
Insurance - EMPLOYEE shall receive such medical, surgical, dental and/or
hospitalization insurance as EMPLOYER shall provide to its other
officers/employees/consultants.
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(c) Other
- EMPLOYEE shall receive such other fringe benefits as are available to any
other officers/employees/consultants. Nothing contained in this Agreement shall
be in lieu of any rights, benefits and privileges to which EMPLOYEE may be
entitled under any stock option, 401(k), retirement, pension, profit-sharing,
insurance, ESOT/ESOP, hospitalization, medical, surgical, dental, legal or other
plans which may now be in effect or which may hereafter be adopted, either by
EMPLOYER or any subsidiary or affiliate of EMPLOYER. EMPLOYEE shall
have the same rights and privileges to participate in such plans and benefits as
any other employee during his or her period of employment and EMPLOYEE shall be
entitled to participate on parity with executives of equal rank.
(d)EMPLOYER shall reimburse EMPLOYEE up to
$60 per month for cell phone expenses upon presentation by EMPLOYEE, on a
monthly basis, of EMPLOYEE’s monthly xxxx for cell phone service.
(e)EMPLOYER shall reimburse EMPLOYEE for
deductible, co-pay and/or co-insurance payments made by EMPLOYEE under any
medical, dental and/or vision insurance provided by EMPLOYER.
(b) EMPLOYEE'S
performance shall be subject to the supervision of EMPLOYER'S Board of
Directors. The precise job description and the specific services to
be rendered by EMPLOYEE may be defined, interpreted, curtailed, or extended,
from time to time, by determination of the EMPLOYER' Board of Directors,
provided, however, that any definition, interpretation, curtailment, or
extension is consistent with the status of, and/or educational experience
required for, the responsibilities for which EMPLOYEE has been engaged
hereunder. It is the intent of this provision to provide EMPLOYER with
flexibility in assigning responsibilities to EMPLOYEE and/or promoting EMPLOYEE,
and this provision shall not be used to discipline, embarrass, humiliate or
harass EMPLOYEE.
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(b) For
purposes hereof, "Proprietary Information" shall not include information which
(i) is publicly available from a source other than EMPLOYEE or can be lawfully
obtained from a third party or parties in lawful possession thereof, or (ii) is
publicly released in writing by EMPLOYER, or (iii) is required to be disclosed
pursuant to the authority of any court or public agency.
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(b) EMPLOYEE
agrees that the "time", "geographic area", and "Scope of Business" provisions of
this restrictive covenant are reasonable and proper and have been negotiated in
connection with his or her employment hereunder.
(c) EMPLOYER
and EMPLOYEE agree, that if any court of competent jurisdiction shall, for any
reason, conclude that any portion of this covenant shall be too restrictive, the
court shall determine and apply lesser restrictions, it being the intent of the
parties that some such restrictions shall be applicable for the protection of
EMPLOYER and its shareholders.
(b) EMPLOYER
and EMPLOYEE agree, that if any court of competent jurisdiction shall, for any
reason conclude that any portion of this covenant shall be too restrictive, the
court shall determine and apply lesser restrictions, it being the intent of the
parties that some such restrictions shall be applicable for the protection of
EMPLOYER and its shareholders.
(c) This
covenant has been given to induce EMPLOYER to enter into this Agreement and
provide EMPLOYEE'S job responsibilities and compensation.
(i) "Inventions" shall
mean:
(A) All
inventions, improvements, modifications, and enhancements, whether or not
patentable, made by EMPLOYEE during EMPLOYEE's employment by EMPLOYER;
and
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(B) All
inventions, improvements, modifications and enhancements made by EMPLOYEE,
during a period of one (1) year after any suspension or termination of
EMPLOYEE's employment by EMPLOYER, which relate, directly or indirectly, to the
past, present or planned future business of the EMPLOYER, determined as of the
date of termination.
(ii)
"Work Product" shall mean all documentation, software, creative works, programs,
systems, source codes, know-how and information created, in whole or in part, by
EMPLOYEE during EMPLOYEE's employment by EMPLOYER, whether or not copyrightable
or otherwise protectable, excluding Inventions.
(iii)
"Trade Secrets" shall mean all documentation, software, know-how and information
relating to the past, present and future business of the EMPLOYER or any plans
therefor, or relating to the past, present or future business of a third party
or plans therefor that are disclosed to the EMPLOYER, which the EMPLOYER may not
or does not disclose to third parties without restrictions on use or further
disclosure. In the case of EMPLOYEE, the term “Trade Secrets” shall
include all knowledge, information and know-how regarding the Internal Revenue
Service and its rules, procedures, practices, personnel and policies (whether or
not published).
(b) EMPLOYEE
shall promptly disclose to EMPLOYER all Inventions and keep accurate records
relating to the conception and reduction to practice of all
Inventions. Such records shall be the sole and exclusive property of
EMPLOYER, and the EMPLOYEE shall surrender possession of such records to the
EMPLOYER upon any suspension or termination of EMPLOYEE's employment with the
EMPLOYER.
(c) EMPLOYEE
hereby assigns to the EMPLOYER, without further consideration to the EMPLOYEE,
the entire right, title and interest in and to the Inventions and Work Product
and in and to all proprietary rights therein or based
thereon. EMPLOYEE agrees that the Work Product shall be deemed to be
a "work made for hire". EMPLOYEE shall execute all such assignments,
oaths, declarations and other documents as may be prepared by EMPLOYER to effect
the foregoing.
(d) EMPLOYEE
shall provide EMPLOYER with all information, documentation, and assistance
EMPLOYER may request to perfect, enforce, or defend the proprietary rights in or
based on the Inventions, Work Product or Trade Secrets. EMPLOYER, in
its sole discretion, shall determine the exact extent of the proprietary rights,
if any, to be protected in or based on the Inventions and Work
Product. All such information, documentation and assistance shall be
provided at no additional expense or cost to the EMPLOYER, except for
out-of-pocket expenses which the EMPLOYEE incurs at the EMPLOYER's
request.
(e) In
the event of termination of this Agreement, EMPLOYER shall be entitled to advise
any new employer of EMPLOYEE of his or her rights and obligations
hereunder.
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(b) EMPLOYER
may elect to continue the payment of full compensation notwithstanding the
foregoing. Such payments shall be in the sole discretion of EMPLOYER,
may be discontinued at any time, and if initiated shall not thereby become a
duty or requirement.
(1)the EMPLOYEE'S death;
(2)the occurrence of one of the following
events:
(i) EMPLOYEE
commits and/or is officially charged with a felony or any crime involving moral
turpitude or unethical conduct which in the good faith opinion of the EMPLOYER
could impair his or her ability to perform his or her duties or which impacts
the market price of the EMPLOYER’s Common Stock;
(ii) EMPLOYEE
commits an act, or fails to take action in bad faith and to the detriment of the
EMPLOYER, or
(iii) in
the good faith opinion of the EMPLOYER's Board of Directors, the EMPLOYEE fails,
to a material extent, to fully and faithfully perform his or her obligations
under this Agreement.
(b)The termination of EMPLOYEE'S services
shall not constitute a termination of the restrictive obligations and duties
under Paragraphs 11, 12, 13 and 14.
(c)In the event of the bankruptcy (Chapter
7), reorganization (Chapter 11) or other termination of the business of the
EMPLOYER, the provisions of Paragraph 12 shall continue in full force and effect
only so long as full base compensation by EMPLOYER shall continue.
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(d)If EMPLOYER terminates EMPLOYEE’s
employment hereunder without cause or EMPLOYEE terminates his or her employment
hereunder for any reason or no reason, then EMPLOYER shall (i) pay EMPLOYEE his
or her annual salary earned but not yet paid through the date that notice of
such termination was given, (ii) deliver to EMPLOYEE any annual stock bonus
earned under Paragraph 5 hereof but not yet paid, (iii) reimburse EMPLOYEE for
any expenses pursuant to Paragraph 10 hereof subject to EMPLOYEE’s compliance
with the provisions thereof and (iv) provide any other rights, compensation
and/or benefits as may be due to EMPLOYEE in accordance with the terms and
provisions of any agreements, plans or programs of EMPLOYER (excluding severance
plans or policies, if any).
(e) IF
EMPLOYER terminates EMPLOYEE’s employment for good cause, then EMPLOYER shall
(i) pay EMPLOYEE his or her annual salary earned but not yet paid through the
date that notice of such termination was given, (ii) reimburse EMPLOYEE for any
expenses pursuant to Paragraph 10 hereof subject to EMPLOYEE’s compliance with
the provisions thereof and (iii) provide any other rights, compensation and/or
benefits as may be due to EMPLOYEE in accordance with the terms and provisions
of any agreements, plans or programs of EMPLOYER (excluding severance plans or
policies, if any).
17. ARBITRATION. Any
controversy or claim arising out of, or relating to this Agreement, or the
breach thereof, shall be settled by arbitration in Houston, Texas accordance
with the rules then pertaining of the American Arbitration Association, but with
all rights of discovery provided by the Texas Rules of Civil Procedure, and
judgment upon the award rendered may be entered in any court having jurisdiction
thereof, which award and judgment may include reasonable attorney’s fees and
costs.
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23.APPLICABLE LAW. This
Agreement shall be governed for all purposes by the laws of the State of Texas,
without reference to any “conflict of law” provisions. If any
provision of this Agreement is declared void, such provision shall be deemed
severed from this Agreement, which shall otherwise remain in full force and
effect.
[Signatures
appear on next page]
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TAXMASTERS, INC. | |
By: /s/ Xxxxxxx X. Xxx | |
Name: Xxxxxxx
X. Xxx
Title:
Chief Executive Officer
|
|
EMPLOYEE: | |
/s/ Xxxxxxxxx X. Xxxxxxx | |
Name: Xxxxxxxxx X. Xxxxxxx |
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Plan and
direct all aspects of EMPLOYER’s legal affairs and ensures maximum protection of
EMPLOYER’s legal rights by leading the defense of EMPLOYER in lawsuits and the
prosecution of lawsuits on behalf of EMPLOYER against
others.
Provide
legal expertise to other departments as requested.
Lead and
direct the work of the legal department.
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