EXHIBIT 10.02
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June 11, 1999
Xxxxxx Xxxxx
Xxxxx & Co.
000 Xxxxx Xxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Regarding: Terms of Employment
Dear Xxxxxx,
This letter confirms the terms of the agreement between Modern Records, Inc.
("the Company") and Xxxxxx Xxxxx ("Xxxxx").
1. Engagement. The Company has agreed to employ Xxxxxx Xxxxx and Xxxxx has
agreed to provide the Company with those services referred to in paragraph 3 of
this agreement. Xxxxx is the President of Perry & Company, an Internet Business
firm and the editor of the Internet Stock Review, an Internet newsletter, with
over 19,000 subscribers through his own website.
2. Terms. The initial term of the employment is for a period of two years from
the date of this agreement. This agreement may be renewed at the end of the
initial term, and at the end of each subsequent renewal term, for successive
three month periods, but only upon written notice by the Company and Xxxxx that
it desires to continue the engagement.
This agreement may be terminated forthwith by the Company with three (3) days
prior written notice if, at any time while in the performance of his duties,
Xxxxx:
(a) commits a material breach of a provision of this agreement;
(b) is unable or unwilling to perform the duties under this agreement;
(c) commits fraud or serious neglect or misconduct in the performance of his
duties to the Company;
3. Services. Xxxxx will provide the Company with assistance with respect to
setting up a corporate news dissemination and will assist the Company in
developing an Internet strategy intended to strengthen Modern's brand
identification with both trade and consumer audiences through consistent
messaging of Modern's activities. Xxxxx is aware that the Company is a publicly
listed Company on the Vancouver Stock Exchange as well as on the NASDAQ OTC
bulletin board and has securities registered under the securities exchange act
of 1984 and as such is aware of policies and regulations with respect to timely
and accurate disclosure of information to the public.
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While this agreement is in force, Xxxxx will provide the Company with a premium
position (first page, standard sized "Watch List" banner) on the website of the
Internet Stock Review, at no additional cost. As well, Xxxxx will additionally
distribute to the subscribers of the Internet Stock Review Online newsletter,
all public corporate announcements and public earnings announcements pre-
approved in writing by the Company, at no additional cost.
4. Compensation of Services. The Company has agreed to grant to Xxxxx stock
options to purchase 200,000 common shares in the Company. The right for Xxxxx to
purchase shares under the stock option agreement will vest immediately after
options are granted. Such options are subject to the approval of the
shareholders of the Company as well as the Vancouver Stock Exchange and any
other applicable regulatory bodies. The pricing of the options are subject to
Vancouver Stock Exchange rules and policies. Such approvals as are required
shall be obtained by the Company and provided Xxxxx at or before execution
hereof. The Company shall advise Xxxxx in writing if the stock option price set
forth in the agreement conflicts with the VSE rules and policies and, if so,
Xxxxx and the Company shall agree on the per share option price prior to
execution hereof. The stock issued under such option will not be freely tradable
and must be resold pursuant a registered offering and under an applicable exempt
under the US securities laws. The option will expire in 2 years from the grant
of the option.
Xxxxx and the Company agree that the compensation represented by the stock
options covering the 200,000 shares is a non-refundable payment for the
engagement of Xxxxx'x services. If the Company decides not to renew this
agreement, no refund will be forthcoming to the Company or be payable by Xxxxx.
If the Company shall register any of its securities for public sale, Perry, in
its discretion, shall have the right to piggyback some or all of its restricted
shares of the Company in such registration statement, subject to any required
consent by the Company's underwriter. The Company shall to its best effort
registers the stock options for Xxxxx in the US. Xxxxx shall only be responsible
for direct costs relating to the sale of its shares thereby, such as brokerage
commissions or underwriters discount prospectus cost pro rata to the number of
prospectuses supplied by Xxxxx, SEC and blue sky filing fees.
5. Costs. The Company will be responsible for all printing and distribution,
press release and/or advertising costs recommended by Xxxxx and pre-approved by
the Company. The Company will also be responsible for all travel related costs
incurred by Xxxxx when providing its' services as determined by Xxxxx and pre-
approved by the Company.
6. Additional Obligations of Xxxxx. Xxxxx agrees that, in connection services to
the Company, it will abide by the following conditions:
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Xxxxx will distribute only financial or other material information about the
Company, which is already available to the public and the release of such
information shall be made with the prior written consent and approval of the
Company.
After notice by the Company of filing for a proposed public offering of
securities, and during any period of restriction on publicity, Xxxxx shall not
engage in any public relations efforts without prior written approval of legal
council for the Company.
Xxxxx will indemnify the Company from all claims, liability, costs or other
expenses (including reasonable attorney's fees) incurred by the Company as a
result of any in a inaccurate information concerning the Company released by
Xxxxx, unless such information was provided in writing to Xxxxx by the Company
or as a result of any breach by Xxxxx of any of the terms and conditions of this
agreement.
7. Additional Obligation of the Company. The Company agrees that, in connection
with this agreement, it will indemnify Xxxxx from all claims, liability, costs
or other expenses incurred (including reasonable attorneys' fees) incurred by
Xxxxx as a result of any inaccurate or misleading information that is given to
Xxxxx in writing by the Company as per the terms of this agreement concerning
the Company and provided in writing by the Company or as a result of any breach
by the Company of any of the terms and conditions of this agreement. If, in the
Company's judgement, any material non-public information concerning the Company
cannot be revealed, the Company will advise Xxxxx that a quite period is in
effect.
8. Assignment. The rights and obligations of each party to this agreement may
not be assigned without the prior written consent of the other party.
9. Entire Agreement. This letter agreement between the Company and Perry
contains the entire agreement between them. This agreement may not be modified
or extended except in writing and signed by the Company and Xxxxx.
10. Regulatory approval. This agreement is subject to the approval of the
Vancouver Stock Exchange and any other regulatory authority.
11. California Law. This agreement shall be governed by and construed in
accordance with California law.
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12. Arbitration and Waiver of Jury Trial. ANY DISPUTE BASED UPON OR ARISING OUT
OF THIS LETTER AGREEMENT SHALL BE SUBJECT TO BINDING ARBITRATION TO BE HELD IN
LOS ANGELES COUNTY, CALIFORNIA BEFORE A RETIRED CALIFORNIA SUPERIOR COURT JUDGE.
JUDGEMENT ON THE ARBITRATOR'S AWARD SHALL BE FINAL AND BINDING, AND MAY BE
ENTERED IN ANY COMPETENT COURT. AS A PRATICAL MATTER, BY AGREEING TO ARBITRATE
ALL PARTIES ARE WAIVING JURY TRIAL.
13. Attorney fees. The prevailing party in any arbitration or litigation arising
out of or relating to this letter agreement shall be entitled to recover all
attorney's fees and all costs (whether or not such costs are recoverable
pursuant to California Code of Civil Procedure) as may be incurred in connection
with either obtaining or collecting any Judgement and/or arbitration award, in
addition to any other relief to which that party may be entitled.
Please sign this letter agreement in the space provided below to indicate your
agreement with the terms stated in this letter.
Sincerely,
By: /s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx, President & CEO
(being hereunto duly authorized)
AGREED AND ACCEPTED THIS 11th DAY OF JUNE, 1999.
By: /s/ Xxxxxx Xxxxx
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Xxxxxx Xxxxx
