CALYPSO WIRELESS, INC. EXECUTIVE EMPLOYMENT AGREEMENT
CALYPSO
WIRELESS, INC.
THIS EXECUTIVE EMPLOYMENT AGREEMENT
("Agreement"), is entered into on August 21, 2007 and effective as of August
21,
2007, by and between CALYPSO WIRELESS, INC., a
Delaware corporation (“CALYPSO”), and XXXXXX X. XXXXXX (the
“Executive”).
WHEREAS,
CALYPSO has
experienced considerable success in the business of designing, engineering,
researching and developing wireless technology, cellular telephones and other
equipment; and
WHEREAS,
CALYPSO
wishes to employ Executive in the capacity of CHIEF FINANCIAL OFFICER for a
minimum period of One (1) year; and
WHEREAS,
the Executive
wishes to become an employee of CALYPSO as its CHIEF FINANCIAL OFFICER;
and
WHEREAS,
the parties
believe it to be in their mutual interest to set forth in writing the terms
and
conditions of Executive’s employment by CALYPSO; and
WHEREAS,
the Agreement
shall govern the employment relationship between the parties from and after
the
effective date hereof and it supersedes all previous employment agreements
between them, except as defined below, either written or oral, heretofore
made.
NOW,
THEREFORE, in
consideration of the foregoing, the parties agree as follows:
1. Recitals. The
above recitals are true and correct and fully incorporated herein and form
an
integral part of this Agreement.
2.
Intent
and Scope of Agreement. The purpose of this agreement is for
Calypso to execute an employment agreement that allows it to procure the
services of the Executive as its Chief Financial Officer. This agreement does
not supersedes the previous Executive Employment Agreement with respect to
amount owned and previous stock options or stocks.
3. Employment. CALYPSO
hereby employs the Executive to serve as its Chief Financial Officer, and the
Executive hereby accepts such employment with CALYPSO upon the terms and
conditions hereinafter set forth. The duties, responsibilities and
requisites of Executive shall be at a minimum as set forth in the attached
job
description, but shall remain commensurate with such title and shall not
diminish in quality from that currently experienced by Executive.
4. Term. The term (which, for purposes of the Agreement, shall include any extensions) of the Agreement shall commence as of the date of the signing of this Agreement, and, except as otherwise provided in Section 12 hereof, shall terminate one year from such commencement date (the “Initial Term”), and shall include all additional periods, as extended. At the expiration date, and each year thereafter, this Agreement shall be renewed upon mutual consent and agreed upon terms, of CALYPSO and Executive for an additional period to be negotiated by the parties.
5. Compensation.
A. Base
Compensation. For all services rendered during the term
of this Agreement by the Executive to CALYPSO, the Executive shall receive
base
compensation of $ 140,000.00 per annum (One Hundred Forty Thousand US Dollars)
(the “Base Compensation”). Commencing on August 21, 2007. CALYPSO
shall pay Executive the Base Compensation in twenty-four (24) equal Semi-Monthly
payments commencing on the commencement date as provided in section 4 hereof,
and paid every 15th and every
30th of the
month
(except the month of February which shall be paid on the 28th).
B. Bonus
Payment. Executive shall receive an additional compensation of
200,000 (Two Hundred Thousand) S-8 Free Trading shares of CALYPSO as a signing
bonus upon signature of this employment agreement. The stocks certificate will
be delivered to the Executive after Calypso filed the S-8 or as soon therefore
as practical and the transfer agent issue the stock certificate.
C. Bonus
Payment. Executive shall receive an additional compensation of $
10,000.00 (Ten Thousand) as a signing bonus upon signature of this employment
agreement.
D. Additional Compensation to Executive. In addition to the compensation stated above, Executive shall receive 250,000 (Two Hundred Fifty Thousand) stock options at a price of .18 cents (Eighteen cents) per share of CALYPSO per year for the duration of this Employment Agreement and providing that she is not terminated pursuant to the provisions of paragraph 14 (B), and will be fully vested if there is a change in control pursuant to paragraph 15.
E. Board
of Directors Compensation. If
during the term of this Agreement the Executive participates as a member of
the
Board of Directors, in addition to the compensation stated above, Executive
shall receive a compensation for serving as a member of the Board of Directors
of Calypso Wireless, Inc. in the amount determined by the Board of Directors
of
CALYPSO in its absolute and sole discretion for all members of the Board. Said
Board of Directors Compensation shall be in addition to the base compensation
and all other forms of compensation described herein in 5(A)-(D).
6.
Duties and
Restrictions.
6.1 Position. During
the term of this Agreement, the Executive shall serve as Chief Financial Officer
of CALYPSO and shall devote time, attention, energy and skills to the faithful
and diligent performance of his duties, including, without limitation,
participating in the prosecution or defense of any litigation on behalf of
CALYPSO, which may include traveling as reasonably requested by
CALYPSO. Except as otherwise agreed between CALYPSO and
EXECUTIVE from time to time Employee agrees to devote 50% of his business time,
attention, skill, and efforts to the performance of his duties and
responsibilities on behalf of CALYPSO which shall be assigned to him from time
to time by the CALYPSO, if pay is current. The CFO shall work on site
at Calypso’s offices at least five days per month with expenses paid by CALYPSO
and devote at least twenty hours per week to Calypso and shall be responsible
for performing all of the functions expected of a CFO of a publicly traded
company. Nothing in this Agreement shall preclude Executive from
devoting reasonable periods required for:
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(a)
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serving
as a director or member of a committee of any organization or corporation
involving no conflict of interest with the interests of
Calypso;
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(b)
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serving
as a consultant or an academic faculty in his area of expertise (in
areas
other than in connection with the business of Calypso), to government,
industrial, and academic panels where it does not conflict with the
interests of Calypso; and
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(c)
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managing
his personal investments or engaging in any other noncompeting
business;
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provided
that such activities do not materially interfere with the regular performance
of
his duties and responsibilities under this Agreement. “The Business
of Calypso” for purposes of this paragraph and this Agreement shall mean work in
the area of telecommunications.
6.2 Non-Disclosure. Executive
agrees that he will not disclose, now or at anytime in the future, any
information which is treated by Calypso as confidential, including, but not
limited to, information relating to the business of Calypso, any of Calypso's
products, customers, affairs, trade secrets, developments, methods of
distribution and any other information relating to Calypso which Calypso shall
deem proprietary, to any person, firm, company, corporation, association, or
any
other entity provided that disclosure of confidential information may be made
(i) to the extent that such information is generally available and known in
the
industry, through no action of Executive, or (ii) as required by
law.
6.3 Return
of Documents. Upon the expiration or termination of this Agreement,
Executive shall not remove from Calypso, without written consent of Calypso,
any
manuals, records, drawings, blueprints, data, tables, calculations, letters,
documents, or any copy or other reproduction thereof, or any other property
or
confidential information, of or pertaining to Calypso or any of its
subsidiaries. All of the foregoing shall be returned to Calypso on or
before the date of expiration or termination of employment.
6.4 No
Actions In Conflict of Calypso’s Interest. Executive
recognizes that the services to be performed by him pursuant to this Agreement
are special, unique and extraordinary. The parties confirm that it is
reasonably necessary for the protection of Calypso’s goodwill that Executive
agree not to act in any way that would be detrimental to Calypso and constitute
a conflict of interest. Therefore, during the term of this Agreement,
Executive will not, directly or indirectly, except for the benefit of
Calypso:
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(i)
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solicit,
cause or authorize, directly or indirectly, to be solicited for
or on
behalf of himself or third parties from parties who are or were
customers
of Calypso (including its present and future subsidiaries and affiliates)
at any time during the term of this Agreement, any business similar
to the
business transacted by Calypso with such customer. This shall
not preclude Executive from soliciting the services of a supplier
or
customer of Calypso in furtherance of a noncompeting business as
allowed
under Paragraph 6(a) hereof;
or
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(ii)
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accept
or cause or authorize, directly or indirectly, to be accepted for
or on
behalf of himself or third parties, business from any such customers
of
Calypso (including its present and future subsidiaries and affiliates),
except as allowed in the last sentence of Paragraph 6.4 (i) above;
or
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(iii)
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solicit,
or cause or authorize, directly or indirectly, to be solicited for
employment for or on behalf of himself or third parties, any persons
who
was at any time during the term of this Agreement, employees of Calypso
(including its present and future subsidiaries and affiliates);
or
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(iv)
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employ
or cause or authorize, directly or indirectly, to be employed for
or on
behalf of himself or third parties, any such employees of Calypso
(including its present and future subsidiaries and affiliates);
or
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(v)
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use
the trade names, trademarks, or trade dress of any of the products
of
Calypso (including its present and future subsidiaries and affiliates);
or
any substantially similar trade name, trademark or trade dress
likely to
cause, or having the effect of causing, confusion in the minds
of
manufacturers, customers, suppliers and retail outlets and the
public
generally.
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6.5 Assignment
of Inventions. If at any time during the term of this
Agreement (either alone or with others) Executive makes, conceives, creates,
discovers, invents or reduces to practice any invention, modification,
discovery, design, development, improvement, process, software program, work
of
authorship, documentation, formula, data, technique, know-how, trade secret,
or
intellectual property right whatsoever or any interest therein (whether or
not
patentable or registrable under copyright, trademark or similar statutes or
subject to analogous protection (each, an “Invention”) that (i) relates to the
Business of Company or any of its Affiliates or any customer of or supplier
to
Company or any of its Affiliates or any of the products or services being
developed, manufactured or sold by Calypso or any of its Affiliates or which
may
be used in relation therewith; or (ii) results from tasks assigned to Executive
by Calypso or any of its Affiliates; or (iii) results from the use of premises
or personal property (whether tangible or intangible) owned, leased or
contracted for by Calypso or any of its Affiliates, then all such Inventions
and
the benefits thereof are and shall immediately become the sole and absolute
property of Calypso and its assigns, as works made for hire or
otherwise. Executive hereby agrees that he shall promptly disclose to
Calypso (or any persons designated by it) each such
Invention. Executive hereby assigns all rights (including, but not
limited to, rights to any inventions, patentable subject matter, copyrights
and
trademarks) he may have or may acquire in the Inventions and all benefits and/or
rights resulting therefore to Calypso and its assigns without further
compensation and shall communicate, without cost or delay, and without
disclosing to others the same, all available information relating thereto (with
all necessary plans and models) to Calypso. Notwithstanding anything
contained in this Agreement or in this Paragraph, any Invention that does not
relate to the area of telecommunications shall remain the exclusive property
of
Executive and Calypso shall have no claim to such Invention, and under no
circumstances shall Executive have the duty or obligation to assign all rights
(including, but not limited to, rights to any inventions, patentable subject
matter, copyrights and trademarks) he may have or may acquire to such Inventions
and all benefits and/or rights resulting therefore.
7. Facilities. The
Executive shall be furnished with such facilities and services as are adequate
and sufficient in the reasonable opinion of the Executive for the
performance of his duties, this shall include without limitation a private
office, computer equipment, administrative assistant, office furniture and
similar facilities..
8. Employee
Benefits. CALYPSO agrees to provide the Executive with
the following benefits:
A.
Vacation. The Executive shall be entitled each year to
vacation time that totals two (2) weeks, during which time his compensation
shall be paid in full. All vacation time shall be taken at times and in
duration convenient to CALYPSO. The vacation time provided herein
shall not be cumulative and not carried forward to any subsequent year(s) by
the
Executive.
B.
Holidays. Executive shall be entitled to the following
Holidays: New Year’s Day, Good Friday, Memorial Day, 4th of July,
Labor Day, Thanksgiving, the Friday after Thanksgiving, Christmas Eve, Christmas
Day, and one Floating Holiday.
C.
Employee Benefits. During the Term of this Agreement, CALYPSO
shall provide the Executive with any other fringe benefits generally available
to employees of CALYPSO, such as medical – health plan.
9. Development
and Other Activity Expenses. CALYPSO recognizes that the
Executive will have to incur certain out-of-pocket expenses, including, but
not
limited to, travel expenses, relating to his services and CALYPSO’s business,
and CALYPSO agrees to promptly reimburse the Executive for all reasonable
expenses necessarily incurred by him in the performance of his duties to CALYPSO
upon presentation of a receipt, voucher, copy of credit card statement or
documentation indicating the amount and business purposes of any such
expenses. These expenses include, but are not limited to, travel,
meals, entertainment, etc.
10. Sick
Leave. The Executive shall be entitled to five (5) days
sick leave during each calendar year, which amounts shall not be
cumulative.
11. Office
and Support Staff. During the term of this Agreement,
Executive shall be entitled to an office of a size and with furnishings and
other appointments, and to secretarial and other assistants, at least equal
to
those provided to other management level employees of CALYPSO and as further
addressed in section 7 herein.
12. Termination.
A.
Grounds. Executive can only be terminated for cause pursuant
to clause 13 A and B, 14 A & B and 15.
B.
Notice of Termination. Any termination by CALYPSO shall be communicated
by Notice of Termination to the Executive and vice versa. For
purposes of this Agreement, a “Notice of Termination” means a written notice
which indicates the date of termination.
13. Definitions. For the purposes of this Agreement, the following terms shall have the following definitions:
A. “Disability”
means a complete physical or mental inability, confirmed by an independent
licensed physician, to perform substantially all of the services described
in
Section 3 hereof that continues for a period of 30 consecutive days during
any
six month period.
B. “Voluntary
Termination” means the Executive’s voluntary termination of his employment.
Voluntary refusal to perform services shall not include taking a vacation in
accordance with Section 8.(A.) hereof, or the Executive’s failure to perform
services on account of his illness or the illness of a member of his immediate
family, provided such illness is adequately substantiated at the reasonable
request of CALYPSO, or any other absence from service with written consent
of
the Board of Directors.
14. Compensation
Upon Termination – Obligations of CALYPSO Upon
Termination.
A. If the
Executive shall suffer a death or a termination hereunder based upon Executive’s
Disability, as defined under Section 13, CALYPSO shall pay the Executive the
following:
(i). the Executive’s full Base Compensation including any past due amounts up to the Date of Termination at the rate in effect on the Date of Termination;
B. If the
Executive shall suffer a Termination based upon any of the following
circumstances, he shall receive no compensation, separation pay, stock options
or any employment benefits referenced in this or any other
agreement:
1. He
commits a felony, or any misdemeanor criminal offense involving a crime of
dishonesty, moral turpitude or violence;
2. He
abuses alcohol or uses illegal narcotics;
3. Engages
in insubordination;
4. He
commits gross negligence in the performance of his duties;
5. He
breaches his fiduciary obligations as Chief Financial Officer;
C.
If the Executive is terminated for any other reason, he shall receive
(90) days (Ninety Days) pay, plus pro-rated stock options as enumerated
herein.
15. Change
in Control. In the event of a Change in Control, as
defined below, the Executive or CALYPSO, shall have the option at any time
within 30 days after the Change in Control occurs to terminate Executive’s
employment.
A. Notice. Written
notice that a “Change in Control” has occurred must be delivered by CALYPSO
within five (5) days after such “Change in Control” occurs. Proper
notice to effectuate a termination upon Change in Control shall be the date
the
Executive or CALYPSO receive written notice which (i) indicates that this
Employment Agreement is being terminated on the basis of Change in Control,
and,
(ii) sets forth in reasonable detail the facts and circumstances claimed to
provide a basis for such termination.
B. Definitions
– Change in Control.
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(i)
“Acquiring Person” means that a Person, considered alone or
together with all Control Affiliates and Associates of that Person,
is or
becomes directly or indirectly the beneficial owner of securities
representing at least fifty-one (51) percent of CALYPSO’s then outstanding
securities entitled to vote generally in the election of the
Board.
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(ii)
“Affiliate” means any “subsidiary” or “parent” corporation (within
the meaning of Section 424 of the Code) of
CALYPSO.
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(iii)
“Board” means the Board of Directors of
CALYPSO.
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(iv)
“Control Affiliate” with respect to any Person, means an Affiliate
as defined in Rule 12B-2 of the General Rules and Regulations under
the
Exchange Act, as amended as of January 1,
1990.
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(v)
“Exchange Act” means the Securities Exchange Act of 1934, as
amended and as in effect from time to
time.
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(vi)
“Person” means any human being, firm, corporation, partnership, or
other entity. Person also includes any human being, firm,
corporation, partnership, or other entity as defined in Section 13(d)(3)
and 14 (d)(2) of the Exchange Act, as amended as of January 1,
1990. The term Person does not include CALYPSO or any related
entity within the meaning of Code Section 1563(a), 414(b) or 414(c),
and
the term Person does not include any employee-benefit plan maintained
by
CALYPSO or by any Related Entity, and any Person or entity organized,
appointed, or established by CALYPSO or by any subsidiary for or
pursuant
to the terms of any such employee-benefit plan, unless the Board
determines that such an employee-benefit plan, or such Person or
entity is
a Person
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(vii)
“Change in Control”. For purposes of this Agreement, a
“Change in Control” shall mean any of the following
events:
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(a)
In the event a Person is or becomes an Acquiring
Person;
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(b)
In the event a Person enters into a agreement that would result
in
that Person becoming an Acquiring
Person;
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(c)
In the event that CALYPSO enters into any agreement with Person
that involves the transfer of at least fifty-one (51) percent of
CALYPSO’s
total assets on a consolidated basis, as reported in CALYPSO’s
consolidated financial statements filed with the Securities and Exchange
Commission, or, if CALYPSO is not required to file consolidated financial
statements with the Securities and Exchange Commission, similar financial
statements;
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(d)
In the event that CALYPSO enters into an agreement to merge
or
consolidate CALYPSO or to effect a statutory share exchange with
another
Person, where the Person and its subsidiaries and affiliates own
at least
fifty-one (51) percent of the company, if CALYPSO is not intended
to be
the surviving or resulting entity after the merger, consolidation,
or
statutory share exchange;
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(e)
A
complete liquidation or dissolution of
CALYPSO;
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(f)
Notwithstanding the foregoing, a Change in Control shall not
be deemed to occur solely because any Person acquired Beneficial
Ownership
as defined in the Exchange Act of more than the permitted amount
of the
then outstanding securities as a result of the acquisition of securities
by CALYPSO which by reducing the number of securities then outstanding,
increased the proportional number of shares Beneficially Owned by
the
subject Person(s) provided that if a Change in Control would occur
as a
result of the acquisition of securities by CALYPSO, and after such
share
acquisition by CALYPSO, the Person becomes the Beneficial Owner of
any
additional securities which increases the percentage of the then
outstanding securities Beneficially Owned by the subject Person,
then a
Change in Control shall occur.
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C. Compensation
Upon Termination Based Upon Change in Control – Payment of Excise
Taxes. If a termination occurs upon a Change in Control
as defined above, and the change control takes place during the first twelve
months of this agreement hen the Company shall pay the Executive those same
amounts at the same time as indicated in Section (14). All stock options for
that year will fully vest.
16. Notices. All
notices required to be given under the Agreement shall be in writing, sent
certified mail, return receipt requested, postage prepaid, to the following
addresses:
(A) If
to the Executive, then to: Xxxxxx X.
Xxxxxx
0000
Xxxxxxx Xxxxxx
Xxxxxxxx
Xxxx, XX 00000
(B) If
to CALYPSO, then
to: Calypso
Wireless, Inc.
0000 XX 00 Xxx, Xxxxx 000
Xxxxx,
XX.
00000
Attention: President
& CEO
17. Governing
Law and Venue. The Agreement shall be governed by and
construed in accordance with the laws of the State of Florida. Venue
for any action or suit brought hereunder or in connection herewith, or relating
hereto, shall lie with the Courts in and for Miami-Dade County,
Florida.
18. Waiver. The
waiver by either party hereto of any breach of any provision of the Agreement
shall not operate or be construed as a waiver of any subsequent breach by either
party hereto.
19. Binding
Effect and Assignment. The Executive acknowledges that
his services are unique and personal. Accordingly, the Executive may
not assign his rights or delegate his duties or obligations under this
Agreement. The Executive’s rights and obligations under this
Agreement shall inure to the benefit of and shall be binding upon the
Executive’s heirs, personal representatives and successors and
assigns. The Agreement shall be binding upon CALYPSO’s successors
and/or assigns.
20. Attorneys
Fees. In the event either party files any action
or suit regarding any of the terms of this Agreement or in relation to, or
involving, Executive’s employment by CALYPSO, then the prevailing party shall be
entitled to recover upon final judgment on the merits its or his reasonable
attorney's fees and court costs (including, without limitation, appellate
attorney’s fees and court costs) incurred in bringing such action and all costs
or expenses, including, without limitation, attorney’s fees and court costs,
incurred in collecting any judgment .
21. Indemnification
and Hold Harmless Provision. CALYPSO hereby agrees to indemnify
Executive, his heirs, successors, and assigns and hold Executive harmless from
any and all liabilities, obligations, expenses, fees, and costs (including
attorney’s and professional fees) of every kind, nature, and description, which
now exist or may exist now or hereafter with respect to Executive’s activities,
duties, or responsibilities as Chief Financial Officer of CALYPSO, or any
subsequent position, or in relation to any of CALYPSO’s subsidiaries,
affiliates, or related entities. Such indemnification and hold
harmless benefits shall be payable by CALYPSO whenever incurred by Executive
so
long as such costs or expenses relate to or arise from such activities, duties,
and responsibilities of Executive and shall not be in any way be dependent
upon
Executive’s employment with CALYPSO. Calypso shall be required to purchase
adequate directors/officers insurance, or other adequate insurance insuring
Calypso’s obligation as set forth in this Section 21.
In
the event Executive is made a party to a lawsuit or is involved in a legal
proceeding in any manner (including by subpoena or as a witness), which relates
directly or indirectly to Calypso or the Executive’s performance of his duties
under this Agreement, in which Executive in his sole discretion believes that
it
is in his best interest to retain independent legal and other professional
counsel. Calypso will pay for such legal counsel.
22. Non-Compete
Clause. For a period of one (1) years after the conclusion of his
employment with Calypso, the Executive shall not engage in any employment or
work for any company or third party, including consulting engagements, that
is
directly involved in competition with Calypso Wireless or any of its
subsidiaries or successors in interest without written consent from the Company.
This shall include but not be limited to any business entity involved in the
development, servicing or manufacture of wireless communications of any type,
including but not limited to cellular telephones. In addition, the Executive
shall not directly or indirectly solicit any Calypso employees, contractors,
or
vendors to gain employment or business affiliation with any business that
competes directly with Calypso.
23. Entire
Understanding; Amendment. The Agreement contains the
entire understanding of the parties relating to the employment of the Executive
by CALYPSO and supersedes any and all previous agreements among the
parties. It may not be changed orally but only by an agreement in
writing signed by the party or parties against whom enforcement of any
waiver, change, modification, extension or discharge is
sought.
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IN
WITNESS WHEREOF, the parties hereto have hereunto set their hands and seals
the
day and year first above written.
EXECUTIVE:
/s/Xxxxxx
X. Xxxxxx
CALYPSO
WIRELESS, INC.,
A
DELAWARE CORPORATION
/s/
Xxxxxxxx Xxxxx
Name:
Xxxxxxxx Xxxxx
Title: Director
- Board Member
