EMPLOYMENT AGREEMENT
Employment Agreement, between Advanced Medical Systems Inc. (the "Company")
and Xxxxxxx X. Xxxxxxx (the "Employee").
1. For good consideration, the Company employs the Employee on the
following terms and conditions.
2. Term of Employment: Subject to the provisions for termination set forth
below this agreement will begin on March 1, 2002, and continue through March 1,
2007
3. Salary: The Company shall pay Employee a salary of $100,000 per year,
for the services of the Employee, payable at regular payroll periods. Employee
agrees to defer all sums except $50,000 until such time as the Company has
raised $3,000,000 in Completed Capital Raise through a private placement or
public offering. Salary will be paid monthly. Accrued but unpaid Salary shall be
paid immediately upon the Completed Capital Raise. Officer loans or expenses
shall be deducted from Deferred Salary before Deferred Salary is paid. On
September 19, of each year, commencing September 19, 2002, the salary shall be
upwardly adjusted for inflation based on increases in the Consumer Price Index
for all consumers, Los Angeles, Orange County, Riverside County metropolitan
area, using September 19, 2001 as a base, unless sooner terminated.
Health Insurance Benefit: Employee will be allowed One Thousand dollars per
month for all Health, Dental & Life Insurance coverage, any expenditures over
that amount must be approved by the Board of Directors, and may be withheld.
Bonus: Executive is entitled to an annual bonus, not to exceed 100% of his
annual salary, the specific amount of which shall be determined annually at the
discretion of the Board of Directors.
Options: Employee has been granted 135,572 shares, to be vested during the
next two years, at the rate of 67,864 per year, subject to continuous employment
during that time. Employee is entitled to purchase up to 100,000 common shares
at the price of $5.00 per share, with a five year option to exercise those
shares.
4. Duties and Position: The Company hires the Employee in the capacity of
Vice President and CFO. The Employee's duties may be reasonably modified at the
Company's direction from time to time.
5. Employee to Devote Full Time to Company: The Employee will devote full
time, attention, and energies to the business of the Company and during this
employment, will not engage in any other business activity, regardless of
whether such activity is pursued for profit, gain, or other pecuniary advantage.
Employee is not prohibited from making personal investments in any other
businesses provided those investments do not require active involvement in the
operation of said companies.
6. Confidentiality of Proprietary Information: Employee agrees, during or
after the term of this employment, not to reveal confidential information, or
trade secrets to any person, firm, corporation, or entity. Should Employee
reveal or threaten to reveal this information, the Company shall be entitled to
an injunction restraining the Employee from disclosing same, or from rendering
any services to any entity to whom said information has been or is threatened to
be disclosed. The right to secure an injunction is not exclusive, and the
Company may pursue any other remedies it has against the Employee for a breach
or threatened breach of this condition, including the recovery of damages from
the Employee.
7. Reimbursement of Expenses: The Employee may incur reasonable expenses
for furthering the Company's business, including expenses for entertainment,
travel, and similar items. The Company shall reimburse Employee for all business
expenses after the Employee presents an itemized account of expenditures,
pursuant to Company policy.
8. Vacation: The Employee shall be entitled to a yearly vacation of four
weeks at full pay.
9. Disability: If Employee cannot perform the duties because of illness or
incapacity for a period of more than twenty two weeks, the compensation
otherwise due during said illness or incapacity will be reduced by 50 (fifty)
percent. The Employee's full compensation will be reinstated upon return to
work. However, if the Employee is absent from work for any reason for a
continuous period of over six months, the Company may terminate the Employee's
employment, and the Company's obligations under this agreement will cease on
that date.
10. Termination of Agreement: Without cause, the Company may terminate this
agreement at any time upon 30 days' written notice to the Employee. If the
Company requests, the Employee will continue to perform his/her duties and be
paid his/her regular salary up to the date of termination. In addition, the
Company will pay the Employee on the date of termination a severance allowance
of six months salary less taxes and social security required to be withheld.
Without cause, the Employee may terminate employment upon thirty days' written
notice to the Company. Employee may be required to perform his/her duties and
will be paid the regular salary to date of termination but shall not receive a
severance allowance. Notwithstanding anything to the contrary contained in this
agreement, the Company may terminate the Employee's employment upon thirty days'
notice to the Employee, with 1 years salary paid should any of the following
events occur:
a) The sale of substantially all of the Company's assets to a single
purchaser or group of associated purchasers; or
b) The sale, exchange, or other disposition, in one transaction of the
majority of the Company's outstanding corporate shares; or
c) The Company's decision to terminate its business and liquidate its
assets;
d) The merger or consolidation of the Company with another company.
e) Bankruptcy or Chapter 11 Reorganization.
11. Death Benefit: Should Employee die during the term of employment, the
Company shall pay to Employee's estate any compensation due through the end of
the month in which death occurred.
12. Restriction on Post Employment Competition: For a period of 3 (three)
years after the end of employment, the Employee shall not control, consult to or
be employed by any business similar to that conducted by the Company, either by
soliciting any of its accounts or by operating within Employer's general trading
area.
13. Assistance in Litigation: Employee shall upon reasonable notice,
furnish such information and proper assistance to the Company as it may
reasonably require in connection with any litigation in which it is, or may
become, a party either during or after employment.
14. Effect of Prior Agreements: This agreement supersedes any prior
agreement between the Company or any predecessor of the Company and the
Employee, except that this agreement shall not affect or operate to reduce any
benefit or compensation inuring to the Employee of a kind elsewhere provided and
not expressly provided in this agreement.
15. Settlement by Arbitration: Any claim or controversy that arises out of
or relates to this agreement, or the breach of it, shall be settled by
arbitration in accordance with the rules of the American Arbitration
Association. Judgment upon the award rendered may be entered in any court with
jurisdiction.
16. Limited Effect of Waiver by Company. Should Company waive breach of any
provision of this agreement by the Employee, that waiver will not operate or be
construed as a waiver of further breach by the Employee.
17. Severability: If, for any reason, any provision of this agreement is
held invalid, all other provisions of this agreement shall remain in effect. If
this agreement is held invalid or cannot be enforced, then to the full extent
permitted by law any prior agreement between the Company (or any predecessor
thereof) and the Employee shall be deemed reinstated as if this agreement had
not been executed.
18. Assumption of Agreement by Company's Successors and Assignees: The
Company's rights and obligations under this agreement will inure to the benefit
and be binding upon the Company's successors and assignees.
19. Oral Modifications Not Binding: This instrument is the entire agreement
of the Company and the Employee. Oral changes shall have no effect. It may be
altered only by a written agreement signed by the party against whom enforcement
of any waiver, change, modification, extension, or discharge is sought.
Signed this 1st day of March 2002.
/s/ Xxxxx Xxxxxx for AMS /s/ Xxxxxxx Xxxxxxx
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Company Employee
