AGREEMENT OF EMPLOYMENT
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THIS AGREEMENT OF EMPLOYMENT ("Agreement") is effective as of October
__, 2001 (the "Effective Date"), and is by and between Ultimate Security Systems
Corporation, a Nevada corporation ("Employer" or "Company"), and Xxxxx X. Xxxxxx
("Executive").
AGREEMENT
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THE MUTUAL COVENANTS, PROMISES, UNDERTAKINGS, AGREEMENTS,
REPRESENTATIONS AND WARRANTIES SPECIFIED IN THIS AGREEMENT, AND OTHER GOOD AND
VALUABLE CONSIDERATION ARE A SUBSTANTIVE PART OF THIS AGREEMENT. THE SUFFICIENCY
OF THE CONSIDERATION IS ACKNOWLEDGED AND RECEIVED WITH THE INTENT OF BEING
LEGALLY AND EQUITABLY OBLIGATED, THEREFORE, THE PARTIES DO HEREBY COVENANT,
PROMISE, AGREE, REPRESENT AND WARRANT AS FOLLOWS:
ARTICLE I.
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DEFINITIONS
For purposes of this Agreement, the following terms have the meanings
specified or referred to in this Article I.
SECTION 1.0 "AGREEMENT" -- employment agreement with an effective date
of October __, 2001 between Employer and Executive.
SECTION 1.1 "BASE SALARY" -- One Hundred Twenty Thousand Dollars
($120,000) per annum less applicable deductions and withholdings.
SECTION 1.2 "BASIC COMPENSATION" -- remuneration received by Executive
from Employer in the form of base salary and benefits.
SECTION 1.3 "BOARD" or "Board of Directors"-- Employer's Board of
Directors.
SECTION 1.4 "CAUSE" -- termination for "Cause" shall mean termination
because of Executive's:
(i) gross incompetence;
(ii) willful gross misconduct resulting in economic harm to Employer
or its affiliates or that brings discredit to Employer's or
Employer's affiliates' reputation;
(iii) insubordination , or failure to follow directions of the Board
of Directors that are consistent with Executive's duties
pursuant to this Agreement;
(iv) final, nonappealable conviction of a felony involving moral
turpitude; or
(v) material breach of any provision of this Agreement.
Section 1.5 "Confidential Information" -- information, regardless of
manner of documentation, used in Employer's and Employer's affiliates' business
and:
(i) any and all trade secrets concerning the business and affairs of
the Company, product specifications, data, know-how, formulae,
compositions, processes, designs, sketches, photographs, graphs,
drawings, samples, inventions and ideas, past, current and
planned research and development, current and planned
manufacturing and distribution methods and processes, customer
lists, current and anticipated customer requirements, price
lists, market studies, business plans, computer software and
programs, including object code and source code, computer
software and database technologies, systems, structures and
architectures, and related processes, formulae, compositions,
improvements, devices, know-how, inventions, discoveries,
concepts, ideas, designs, methods and information, of the
Company and any other information, however documented, of the
Company that is a trade secret within the meaning of applicable
law;
(ii) any and all information concerning the business and affairs of
the Company, including historical financial statements,
financial projections and budgets, historical and projected
sales, capital spending budgets and plans, the names and
backgrounds of key personnel, personnel training and techniques
and materials; and
(iii) any and all notes, analysis, compilations, studies, summaries,
and other material prepared by or for the Company containing or
based, in whole or in part, on any information included in the
foregoing.
Confidential Information shall not include:
(i) information already in Executive's possession prior to the date
of this Agreement unless acquired or obtained from Employer or
its affiliates or pursuant to a confidentiality agreement;
(ii) information obtained or was previously obtained by the Executive
from a third Person who, insofar as is known to the Executive
after reasonable inquiry, is permitted to transmit the
information to Executive by contractual, legal or fiduciary
obligation to Employer or its affiliates; or
(iii) information that is, or becomes, generally available to the
public other than as a result of a direct or indirect disclosure
by the Executive.
SECTION 1.6 "DATE OF TERMINATION" -- the date on which Notice of
Termination is sent or given pursuant to this Agreement.
SECTION 1.7 "DISABILITY" -- Executive's inability or failure to perform
(as determined by the Board of Directors in good faith) Executive's duties
pursuant to this Agreement due to Executive's ill health, physical or mental
disability, or any other reason beyond Executive's control, and notwithstanding
reasonable accommodations made by Employer for a period of thirty (30)
consecutive days or, for an aggregate of sixty (60) days in any twelve (12)
month period.
SECTION 1.8 "EFFECTIVE DATE" -- the date specified in the preamble of
the Agreement.
SECTION 1.9 "EMPLOYEE INVENTIONS" -- all discoveries, inventions,
improvements, designs, innovations and works of authorship, including all data
and records pertaining thereto, which relate to the business of Employer,
whether or not capable of being patented, copyrighted or reduced to writing,
that Employee may discover, invent or originate during the term of his
employment pursuant to this Agreement, and for a period of six (6) months
following the termination of this Agreement, either alone or with other persons
and whether or not during working hours or by the use of the facilities of
Employer.
SECTION 1.10 "FISCAL YEAR" -- Employer's fiscal year, as it exists on
the Effective Date or as changed from time to time.
SECTION 1.11"PERSON" -- any individual, corporation (including any
non-profit corporation), general or limited partnership, limited liability
company, joint venture, estate, trust, association, organization, or
governmental body.
SECTION 1.12 "POST-AGREEMENT PERIOD"-- the period beginning on the date
of termination of Executive's employment with Employer, plus six (6) months.
SECTION 1.13 "SALARY" -- gross cash compensation paid in equal periodic
installments to Executive by Employer in the amount of One Hundred Twenty
Thousand Dollars ($120,000) per annum.
ARTICLE II.
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EMPLOYMENT TERMS AND DUTIES
SECTION 2.1 EMPLOYMENT. Employer hereby employs Executive, and
Executive hereby accepts employment by Employer, upon the terms and subject to
the conditions set forth in this Agreement.
SECTION 2.2 TERM. Subject to the provisions of Article VI, the term of
Executive's employment pursuant to this Agreement will be five (5) years,
beginning on the Effective Date and ending on a date exactly five (5) years
after the Effective Date ("the First Term"). The term of this Agreement is
automatically renewable for succeeding periods of five (5) years each unless
either party gives notice to the other party of the noticing party's intention
not to renew the term of this Agreement. Notice must be received at least thirty
(30) days prior to the expiration of the First Term and at least sixty (60) days
prior to the expiration of any subsequent term. For purposes of this Agreement,
the word "Term" will include the First Term and any renewal terms.
SECTION 2.3 POSITION AND DUTIES. Executive will initially serve as
Chief Executive Officer of the Company and shall be assigned or delegated duties
by the Board of Directors. Executive shall have those duties and authority
customarily commensurate with one employed in Executive's position. Executive
shall perform, to the best of Executive's ability, all duties incident to
Executive's position with the highest degree of good faith and loyalty.
Executive shall use Executive's best efforts to promote the interests of the
Company.
SECTION 2.4 OBLIGATION TO THE COMPANY. Executive represents and
warrants to Employer that Executive, is under no obligations or commitments,
contractual or otherwise, which is inconsistent with Executives obligations
under this Agreement. During the term of Executive's employment, Executive will
comply fully with the Company's policies and rules in effect. During the Term of
this Agreement, Executive will not engage in any competitive business activity
without the express written consent of the Board. Executive will:
(i) devote his entire business time, attention, skill, and energy
exclusively to the business of Employer;
(ii) use his best efforts to promote the success of Employer's
business; and
(iii) cooperate fully with the Board of Directors in the advancement
of the best interests of Employer. Executive will fulfill his
duties as a member of Employer's Board of Directors without
additional compensation.
ARTICLE III.
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COMPENSATION AND BENEFITS
Section 3.1 Basic Compensation. During the Term, Executive's basic
compensation will consist of the following salary and benefits:
(a) BASE SALARY. Employer shall pay Executive as compensation for
Executive's services a base salary in the sum of One Hundred Twenty Thousand
Dollars ($120,000) annually ("Base Salary"), less applicable deductions and
withholdings. Executive will receive equal periodic installments according to
Employer's customary payroll practices, but not less frequently than
semi-monthly. Any earned but unpaid salary will accrue interest at ten percent
(10%) per annum until paid.
(b) BENEFITS. During the Term, Executive is eligible to participate in
all Company employee benefit plans applicable to other senior executives of the
Company of similar rank and status, according to the terms of such plans, as
such plans and terms exist from time to time. Benefits include, but are not
limited to, group health insurance, 401(K), and equity incentive plans
(collectively, "Core Benefits").
SECTION 3.2 BONUS. In addition to the Salary and the Core Benefits,
Executive is entitled to receive from Employer a cash bonus in an amount equal
to one percent (1%) of Employer's "gross income" for each of Employer's complete
fiscal quarters during the Term. For purposes of this Section 3.2, the term
"gross income" is defined as and shall mean all gross income from the operations
of Employer (other than capital gains). "Gross income" shall be determined in
accordance with generally accepted accounting principles utilized by the
certified public accountant(s) regularly employed by Employer, and the
determination of gross income by such accountant(s) shall obligate and be
conclusive on Employer and Executive. Payment of the bonus shall be made no
later than forty-five (45) days after the end of Employer's fiscal quarter for
which such bonus is due and payable.
SECTION 3.3 HEALTH CARE BENEFITS. Employer shall, as part of
Executive's Core Benefit package, include Executive in the hospital, surgical,
medical and dental benefit plan maintained by Employer.
SECTION 3.4 ILLNESS. During the Term, Executive shall be entitled to
participate in Employer's sick leave policies.
SECTION 3.5 OTHER BENEFITS. In addition to those benefits available to
other senior executives of similar rank and status, Executive shall receive all
other benefits of employment available generally to other employees of Employer.
ARTICLE IV.
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FACILITIES AND EXPENSES
SECTION 4.1 OFFICE AND STAFF. Employer will furnish Executive office
facilities, equipment, supplies, and such other facilities and personnel, as
Employer deems necessary or appropriate for the performance of Executive's
duties pursuant to this Agreement.
SECTION 4.2 REIMBURSEMENT OF BUSINESS EXPENSES. During the Term,
Executive is authorized to incur necessary and reasonable travel and other
business expenses in connection with Executives duties. Employer will pay on
behalf of Executive (or reimburse the Executive for) reasonable business
expenses incurred by Executive at the request of, or on behalf of, Employer in
the performance of the Executive's duties pursuant to this Agreement, and in
accordance with Employer's employment policies. Business and travel expenses
incurred must be consistent with policies and procedures established by the
Company. Executive will be reimbursed for such expenses according to Company
policies and procedures upon presentation of an itemized account and appropriate
supporting documentation.
ARTICLE V.
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VACATIONS AND HOLIDAYS
SECTION 5.1 ANNUAL VACATION. Executive will be entitled to
participate in Employer's vacation and holiday policies.
SECTION 5.2 PAID HOLIDAYS. Per Employer's policies, Executive will
also be entitled to paid holidays.
ARTICLE VI.
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TERMINATION
SECTION 6.1 (A) DISABILITY. Employer may terminate this Agreement for
Disability. Executive hereby consents to examination by a physician designated
by Employer, and Executive hereby waives any physician-patient privilege
resulting from any such examination, under the following conditions:
(i) Employer must provide Executive with at least sixty (60) days
prior written notice of its intent to have Executive examined.
(ii) Employer must pay any and all expenses and costs related to such
examination, including, but not limited to, Executive's travel
expenses.
(iii) Executive shall have the right to arrange for a second opinion
examination if he disagrees with Employer's physician's
diagnosis. If the second opinion materially contradicts the
initial diagnosis, Employer and Executive shall mutually agree
on a third physician whose diagnosis shall be binding on the
parties. If Employer and Executive cannot mutually agree on a
physician, one shall be chosen by the first two physicians.
(iv) If Executive shall disagree with Employer's decision to order an
examination, Executive shall have the right to prevent such
examination until and unless a mutual third party mediator,
mutually agreed upon by Executive and Employer, recommends such
an examination.
(b) CAUSE. Employer may terminate Executive's employment for Cause.
Termination of Executive for Cause requires either an action of at least a
majority of the Company's Board of Directors at a meeting duly called and held
upon at least thirty (30) business days written notice to the Executive of the
particulars of the act or omission alleged to constitute cause, or an action of
at least two-thirds (2/3) of the Company's shareholders entitled to vote at a
meeting duly called and held upon at least thirty (30) business days written
notice to the Executive of the particulars of the act or omission alleged to
constitute cause. Executive may not be terminated for Cause if Executive cures
such matter within twenty (20) days after such notice is sent or given pursuant
to this Agreement. Executive is permitted to respond and defend himself before
the Board or any appropriate committee thereof within a reasonable time after
written notification of any proposed termination for Cause which involves an
allegation of gross incompetence, willful gross misconduct, insubordination, or
a material breach of any provision of this Agreement.
(c) SEVERANCE. If Executive is terminated for Cause, Executive will
receive on the Date of Termination, as compensation, the following:
(i) The Base Salary provided for in Section 3.1(a) as then in
effect, due and accrued through the Date of Termination;
(ii) On the Date of Termination, Employer shall repurchase all
shares, series and classes of Employer's stock then held by
Executive at the greater of either: (a) the prevailing market
rate; or (b) five dollars ($5.00) per share
(iii) Employer shall pay Executive all vacation pay accrued and unpaid
through the Date of Termination for the year in which such
termination occurred; and
(iv) Executive shall also receive reimbursement for any attorney's
fees related to the Termination.
If Executive is terminated with or without cause, Executive will receive the
Base Salary provided for in Section 3.1(a) which is due but unpaid as of the
Date of Termination and shall be entitled to receive the Base Salary for an
additional thirty-six months (36) following the Date of Termination. Executive
will also receive (ii), (iii) and (iv) directly above.
P
(d) WITHOUT GOOD REASON. During the Term, Executive may terminate his
employment Without Good Reason. Termination "Without Good Reason" shall mean
termination of the Executive's employment by the Executive other than
termination for Employer breach or resulting from the death of Executive.
(e) EXPLANATION OF TERMINATION OF EMPLOYMENT. Any party terminating
this Agreement shall give prompt written notice ("Notice of Termination") to the
other party hereto advising such other party of the termination of this
Agreement. Within ten (10) days after notification that this Agreement has been
terminated, the terminating party shall deliver to the other party hereto a
written explanation, which shall specify in reasonable detail the basis for such
termination and shall indicate whether termination is being made for Cause,
Without Cause or for Disability (if Employer has terminated the Agreement) or
for Employer Breach or Without Good Reason (if Executive has terminated the
Agreement).
(f) GOLDEN PARACHUTE. Executive may elect to terminate his employment
in the event that:
(i) five percent (5%) or more of Employer's then issued and
outstanding common stock or five percent (5%) or more of any
class of Employer's then issued and outstanding preferred stock
is acquired by any person or entity, or persons or entities
acting in concert as determined by Executive in his sole and
absolute discretion;
(ii) Employer loses its ability to exercise a controlling influence
over Employer's operations;
(iii) a hostile election of a majority of Employer's Board occurs; or
(iv) Employer is merged, sold or dissolved.
Such events shall be known as a "Change-In-Control". If Executive elects to be
retained, Executive will maintain that capacity and function occupied by
Executive at the time of such Change-In-Control. If Executive elects to
terminate his employment at such time, and under such conditions, Executive
shall be entitled to those severance arrangements as would be applicable under
Section 6.1(c). In addition to those severance arrangements applicable under
Section 6.1(c), Executive shall further receive a parachute payment consisting
of a one-time, lump sum payment totaling 2.99 times the average of Executives
Base Salary (even if such Base Salary was unpaid) over the past five taxable
years prior to the Change-In-Control ("Parachute Payment"). If the Executive has
not been employed with Employer for five taxable years, the calculation shall be
for the shorter period, with any partial taxable year annualized, excluding
one-time payments, such as relocation expenses. Executive's Parachute Payment
will be adjusted accordingly to avoid tax penalties imposed pursuant to Sections
280G and 4999 of the Internal Revenue Code, as amended. Executive shall also be
reimbursed for 150% of any golden parachute excise taxes. Executive shall also
receive reimbursement for any attorney's fees and other expenses incurred to
collect severance benefits and payments under this section because of a
Change-In-Control. All payments provided for in this Section 6.1(f) are due on
the date of Change-In-Control.
SECTION 6.2 COMPENSATION DURING DISABILITY OR UPON TERMINATION.
(a) DURING DISABILITY. During any period that Executive fails to
perform his duties pursuant to this Agreement because of ill health, physical or
mental disability, or any other reason beyond Executive's control, Executive is
entitled to receive the sick pay specified by the provisions of Section 3.4 of
this Agreement.
(b) TERMINATION FOR DISABILITY. If Employer shall terminate Executive's
employment for Disability, Employer's obligation to pay Basic Compensation shall
terminate, except that Employer shall pay Executive:
(i) accrued but unpaid Basic Compensation through the Date of
Termination, including any interest accrued thereon; and
(ii) the benefits set forth in Section 3.1 (b) for a period not to
exceed ninety (90) days.
SECTION 6.3 DEATH OF EXECUTIVE. If Executive dies prior to the
expiration of the Term, Executive's employment and other obligations pursuant to
this Agreement shall automatically terminate and all compensation, to which
Executive is or would have been entitled pursuant to (including, without
limitation, under Section 3.1), shall terminate as of the date in which
Executive's death occurs.
ARTICLE VII.
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NON-DISCLOSURE COVENANT; EMPLOYEE INVENTIONS
SECTION 7.1 ACKNOWLEDGMENTS BY THE EXECUTIVE. Executive acknowledges
that (a) during the Term and as a part of his employment, Executive will have
access to Confidential Information; (b) public disclosure of such Confidential
Information could have an adverse effect on Employer and its business; (c)
because Executive possesses substantial technical expertise and skill with
respect to Employer's business, Employer desires to obtain exclusive ownership
of each Employee Invention, and Employer will be at a substantial competitive
disadvantage if Employer fails to acquire exclusive ownership of each Employee
Invention; and (d) the provisions of this Article VII are reasonable and
necessary to prevent the improper use or disclosure of Confidential Information
and to provide Employer with exclusive ownership of all Employee Inventions.
SECTION 7.2 AGREEMENTS OF THE EXECUTIVE. In consideration of the
compensation and benefits to be paid or provided to Executive by Employer
pursuant to this Agreement, Executive covenants as follows:
(a) CONFIDENTIALITY.
(i) During and following the Term, Executive will hold in confidence
the Confidential Information and will not disclose the
Confidential Information, or any portion thereof, to any Person,
except with the specific prior written consent of Employer or
except as otherwise expressly permitted by the terms of this
Agreement.
(ii) Any trade secrets of Employer or its affiliates will be entitled
to all of the protections and benefits pursuant to applicable
law. If any information that Employer or its affiliates deems to
be a trade secret is determined by a court of competent
jurisdiction not to be a trade secret for purposes of this
Agreement, such information will, nevertheless, be considered
Confidential Information for purposes of this Agreement.
(iii) None of the foregoing obligations and restrictions applies to
any part of the Confidential Information that Executive
demonstrates was or became generally available to the public
other than as a result of a direct or indirect disclosure by
Executive.
(iv) The Executive will not remove from Employer's or Employer's
affiliates' premises (except to the extent such removal is for
purposes of the performance of the Executive's duties at home or
while traveling, or except as otherwise specifically authorized
by Employer) any document, record, notebook, plan, model,
component, device, or computer software or code, whether
embodied in a disk or in any other form (collectively, the
"Proprietary Items"). Executive agrees that, as between Employer
and Executive, all of the Proprietary Items, whether or not
developed by Executive, are the exclusive property of Employer.
Upon termination of this Agreement by either party, or upon the
request of Employer during the Term, Executive will return to
Employer all of the Proprietary Items in Executive's possession
or subject to Executive's control, and Executive shall not
retain any copies, abstracts, sketches, or other physical
embodiment of any of the Proprietary Items.
(b) Employee Inventions. Each Employee Invention will belong exclusively to
Employer. Executive covenants that Executive will promptly:
(i) disclose to Employer in writing any Employee Invention;
(ii) assign to Employer or to a party designated by Employer, at
Employer's request and without additional compensation, all of
Executive's right to the Employee Invention for the United
States and all foreign jurisdictions;
(iii) execute and deliver to Employer such applications, assignments,
and other documents as Employer may request in order to apply
for and obtain patents or other registrations with respect to
any Employee Invention in the United States and any foreign
jurisdictions;
(iv) sign all other papers necessary to carry out the above
obligations; and
(v) give testimony and render any other assistance in support of
Employer's rights to any Employee Invention.
SECTION 7.3 DISPUTES OR CONTROVERSIES. Executive acknowledges that in
the event that a dispute or controversy resulting from or relating to this
Agreement be submitted for adjudication to any court, arbitration panel, or
other third party, the preservation of the secrecy of Confidential Information
may be jeopardized. All pleadings, documents, testimony and records relating to
any such adjudication will be maintained in secrecy and will be available for
inspection by Employer, Executive, and their respective attorneys and experts,
who will agree, in advance and in writing, to receive and maintain all such
information in secrecy, except as may be limited by them in writing.
ARTICLE VIII.
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NON-COMPETITION AND NON-INTERFERENCE
SECTION 8.1 ACKNOWLEDGMENTS BY EXECUTIVE. Executive acknowledges that
(a) the services to be performed by him pursuant to this Agreement are of a
special, unique, unusual, extraordinary, and intellectual character; (b)
Employer's business conducted nationally and Employer's services and products
are marketed throughout the United States; (c) Employer competes with other
businesses that are or could be located in any part of the United States; and
(d) the provisions of this Article VIII are reasonable and necessary to protect
Employer's business.
SECTION 8.2 COVENANTS OF EXECUTIVE. To the extent permissible pursuant
to California Business and Professions Code section 16600, and in consideration
of the acknowledgments by Executive, and the compensation and benefits to be
provided to Executive by Employer, Executive makes the following covenants.
(a) COVENANTS NOT TO COMPETE. Pursuant to this Agreement, and during
the Term and Post-Agreement Period, Executive shall not engage, invest, own,
manage, operate, finance, control, or participate in the ownership, management,
operation, financing, or control of any business whose products, services or
activities compete in whole or in part with the products, services or activities
of Employer or any affiliate of Employer anywhere in the United States
("Competitor").
(i) During the Term and Post-Agreement Period, Executive will not
be employed by, associated, or in any manner connected with,
a Competitor. Executive may purchase or otherwise acquire up
to three percent (3%) of any class of securities of any
issuer if such securities are listed on any national or
regional securities exchange or have been registered pursuant
to Section 12(g) of the Securities Exchange Act of 1934.
Executive may not, however, participate in the activities of
such issuer.
(ii) During the Term and Post-Agreement Period, Executive may not,
for Executive's own account or for the account of any other
Person, solicit business of the same or similar type as
Employer from any Person known by Executive to be a customer
of Employer, whether or not Executive had personal contact
with such Person during and by reason of Executive's
employment with Employer.
(iii) During the Term and Post-Agreement Period, Executive may not,
for Executive's account or the account of any other Person,
solicit, employ, or otherwise engage as an employee,
independent contractor, or otherwise, any Person who is or
was an employee of Employer at any time during the Term or in
any manner induce or attempt to induce any employee of
Employer to terminate his or her employment relationship with
Employer, nor may Executive interfere with Employer's
relationship with any Person, who at any time during the Term
was an employee, contractor, supplier, or customer of
Employer.
(iv) During the Term and Post-Agreement Period, Executive many
not, disparage Employer or any of Employer's shareholders,
directors, officers, employees, or agents.
(b) DIVISIBILITY OF COVENANTS. If any covenant in this Section 8.2 is
determined by a court of competent jurisdiction to be unreasonable, arbitrary,
or against public policy, such covenant will be divisible with respect to scope,
time, and geographic area, and such lesser scope, time, or geographic area, or
all of them, as a court of competent jurisdiction may determine to be
reasonable, not arbitrary, and not against public policy, will be effective,
binding, and enforceable against Executive.
(c) TIME APPLICABLE TO COVENANTS. The period of time applicable to
any covenant in Section 8.2 is extended by the duration of any violation by
Executive of such covenant.
(d) NOTICE OF SUBSEQUENT EMPLOYMENT. While the covenant, pursuant to
this Section 8.2, is in effect, Executive will give notice of the identity of
Executive's subsequent employer to Company within ten (10) days after accepting
any other employment. Company may notify such employer that Executive is
obligated by this Agreement and, at Employer's election, furnish such employer
with a copy of this Agreement or relevant portions thereof.
ARTICLE IX.
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GENERAL PROVISIONS
SECTION 9.1 INJUNCTIVE RELIEF AND ADDITIONAL REMEDY. Executive
acknowledges that the damage that would be suffered by Employer as a result of a
breach of the provisions of this Agreement (including any provision of Articles
VII and VIII) would be irreparable and that an award of monetary damages to
Employer for such a breach would be an inadequate remedy. Consequently, Employer
will have the right, in addition to any other rights Employer may have, to
obtain injunctive relief to restrain any breach or threatened breach or
otherwise to specifically enforce any provision of this Agreement, and Employer
will not be obligated to post bond or other security in seeking such relief.
SECTION 9.2 COVENANTS OF ARTICLES VII AND VIII ARE ESSENTIAL AND
INDEPENDENT COVENANTS. The covenants by Executive in Articles VII and VIII are
essential provisions of this Agreement, and without Executive's agreement to
comply with such covenants, Employer would not have entered into this Agreement
or employed or continued the employment of Executive. Employer and Executive
have independently consulted their respective counsel and have been advised in
all respects concerning the reasonableness and propriety of such covenants, with
specific regard to the nature of the business conducted by Employer.
Executive's covenants in Articles VII and VIII are independent
covenants and the existence of any claim by Executive against Employer or any of
its affiliates under this Agreement or otherwise will not excuse Executive's
breach of any covenant in Articles VII or VIII.
If Executive's employment pursuant to this Agreement expires or is
terminated, this Agreement will continue in full force and effect as is
necessary or appropriate to enforce the covenants and agreements of Executive in
Articles VII and VIII.
SECTION 9.3 OFFSET. Employer will be entitled to offset against any and
all amounts owing to Executive pursuant to this Agreement the amount of any and
all claims that Employer may have against Executive.
SECTION 9.4 REPRESENTATIONS AND WARRANTIES BY THE EXECUTIVE. Executive
represents and warrants to Employer that the execution and delivery by Executive
of this Agreement do not, and the performance by Executive of Executive's
obligations pursuant to this Agreement will not, with or without the giving of
notice or the passage of time, or both (a) violate any judgment, writ,
injunction, or order of any court, arbitrator, or governmental agency applicable
to Executive; or (b) conflict with, result in the breach of any provisions of or
the termination of, or constitute a default under, any agreement to which
Executive is a party or by which Executive is or may be obligated.
SECTION 9.5 OBLIGATIONS CONTINGENT ON PERFORMANCE. The obligations of
Employer pursuant to this Agreement, including Employer's obligation to pay the
compensation provided for in this Agreement, are contingent upon Executive's
performance of Executive's obligations pursuant to this Agreement.
SECTION 9.6 WAIVER. The rights and remedies of the parties to this
Agreement are cumulative and not alternative. Neither the failure nor any delay
by either party in exercising any right, power, or privilege pursuant to this
Agreement will operate as a waiver of such right, power, or privilege, and no
single or partial exercise of any such right, power, or privilege will preclude
any other or further exercise of such right, power, or privilege or the exercise
of any other right, power, or privilege. To the maximum extent permitted by
applicable law, (a) no claim or right resulting from this Agreement can be
discharged by one party, in whole or in part, by a waiver or renunciation of the
claim or right unless in writing signed by the other party; (b) no waiver that
may be given by a party will be applicable, except in the specific instance for
which it is given; and (c) no notice to or demand on one party will be deemed to
be a waiver of any obligation of such party or of the right of the party giving
such notice or demand to take additional action without notice or demand as
provided in this Agreement.
SECTION 9.7 BINDING EFFECT; DELEGATION OF DUTIES PROHIBITED. This
Agreement shall inure to the benefit of, and shall obligate, the parties hereto
and their respective successors, assigns, heirs, and legal representatives,
including any entity with which Employer may merge or consolidate or to which
all or substantially all of its assets may be transferred. The duties and
covenants of Executive pursuant to this Agreement are personal and may not be
delegated.
SECTION 9.8 NOTICES. All notices, requests, demands or other
communications pursuant to this Agreement is in writing or by telex or facsimile
transmission and is deemed to have been duly given (i) on the date of service if
delivered in person or by telex or facsimile machine transmission (with the
telex or facsimile confirmation of transmission receipt acting as confirmation
of service when sent and provide telexed or telecopied notices are also mailed
by first class, certified or registered mail, postage prepaid); or (ii)
seventy-two (72) hours after mailing by first class, registered or certified
mail, postage prepaid, and properly addressed as follows:
If to Executive: Xxxxx X. Xxxxxx
00000 Xxxx XxXxxxxxx, Xxxxx X
Xxxxxx, Xxxxxxxxxx 00000
Telephone: 000.000.0000
Facsimile: 949.251.0051
If to Employer: Ultimate Security Systems Corporation
00000 Xxxx XxXxxxxxx, Xxxxx X
Xxxxxx, Xxxxxxxxxx 00000
Telephone: 000.000.0000
Facsimile: 949.251.0051
With a copy to: MC LAW GROUP
0000 Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Telephone: 000.000.0000
Facsimile: 949.250.8656
or at such other address as the party affected may designate in a written notice
to such other party in compliance with this section.
SECTION 9.9 ENTIRE AGREEMENT; AMENDMENTS. This Agreement, constitutes
the entire agreement among the parties with respect to the (i) employment
relationship by and among Employer and Executive, and (ii) the terms and
conditions of all other relationships by and among Employer, in any capacity,
and Executive, in any capacity and supersede all prior agreements and
understandings, oral or written, among the parties hereto with respect thereto.
This Agreement may not be amended orally, but only by an agreement in writing
signed by the parties hereto.
SECTION 9.10 GOVERNING LAW. This Agreement will be governed by the laws
of the State of California, without regard to conflicts of laws principles.
SECTION 9.11 JURISDICTION. Any action or proceeding seeking to enforce
any provision of, or based on any right arising out of, this Agreement is
brought against either of the parties in the courts of the State of California,
County of Orange, and each of the parties consents to the jurisdiction of such
courts (and of the appropriate appellate courts) in any such action or
proceeding and waives any objection to venue. Process in any action or
proceeding referred to in the preceding sentence may be served on either party
anywhere in the world.
SECTION 9.12 SECTION AND ARTICLE HEADINGS, CONSTRUCTION. The headings
of sections and articles in this Agreement are provided for convenience only and
will not affect its construction or interpretation. All references to "section"
or "sections" and "article" or "articles" refer to the corresponding section or
sections and article or articles of this Agreement unless otherwise specified.
All words used in this Agreement will be construed to be of such gender or
number as the circumstances require. Unless otherwise expressly provided, the
word "including" does not limit the preceding words or terms.
SECTION 9.13 SEVERABILITY. If any provision of this Agreement, other
than those relating to Section 9.2, is held invalid or unenforceable by any
court of competent jurisdiction, the other provisions of this Agreement will
remain in full force and effect. Any provision of this Agreement determined to
be invalid or unenforceable only in part will remain in full force and effect to
the extent not determined to be invalid or unenforceable.
SECTION 9.14 COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement.
SECTION 9.15 INDEMNIFICATION FOR NEGLIGENCE OR MISCONDUCT.
A. Employer shall save Executive harmless from and against and shall
indemnify Executive for any liability, loss, costs, expenses or damages
howsoever caused by reason of any injury (whether to body, property, or personal
or business character or reputation) sustained by any person or to any person or
to property by reason of any act, neglect, default or omission of Employer, and
Employer shall pay any and all amounts to be paid or discharged in case of an
action for any such damages or injuries. No provision of this section is
intended to, nor shall any provision of this section, relieve Executive from
that Executive's own act, omission or negligence.
B. Executive shall save Employer harmless from and against and shall
indemnify Employer for any liability, loss, costs, expenses or damages howsoever
caused by reason of any injury (whether to body, property, personal or business
character or reputation) sustained by any person or to any person or to property
by reason of any act, neglect, default or omission of Executive, and Executive
shall pay any and all amounts to be paid or discharged in case of an action for
any such damages or injuries. No provision of this section is intended to, nor
shall any provision of this section, relieve Employer from Employer's own act,
omission or negligence.
IN WITNESS WHEREOF the parties have executed this Agreement of
Employment in duplicate and in multiple counterparts, each of which shall have
the force and effect of an original, effective as of the date specified in the
preamble of this Agreement.
"EMPLOYER" "EXECUTIVE"
Ultimate Security Systems Corporation
a Nevada corporation
By:
--------------------------------- -------------------------------
Xxxxx X. Xxxxxx Xxxxx X. Xxxxxx
Its: Chief Executive Officer
