EMPLOYMENT AGREEMENT
This Employment Agreement is made this 1st day of August, 2003, by and between
AGTsports, Inc., a Colorado Corporation, (hereinafter referred to as "Company")
and Xxxxx Xxxxxxx, an individual having an address at 00000 Xxxxxxxx Xxx,
Xxxxxxxxxxx, Xxxxx 00000 (hereinafter referred to as "Employee").
WITNESSETH:
WHEREAS, AGTsports, Inc. desires to hire and retain Employee as Chairman
and Chief Executive Officer of the Company, with all duties, authorities, and
responsibilities as may be normally considered attendant to such position, and
WHEREAS, Employee possesses the necessary skills, knowledge and abilities to
provide such services, and is desirous of accepting said position and employment
with the Company.
NOW THEREFORE, in consideration of the foregoing, of the mutual promises between
the parties as contained herein, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:
I. TERM. The term of this Agreement shall be for a period of three (3)
years commencing on August 1, 2003 and terminating on July 31, 2006. This
agreement shall only be terminated in accordance with the provisions of
Paragraph VI (six) of this Agreement.
II. DUTIES. Effective August 1, 2003, and through July 31, 2006, Employee
shall serve as Chairman and Chief Executive Officer of AGTsports, Inc. and
devote his primary time and attention to his duties as an officer of the
Company, which duties may be augmented or restricted in accordance with the
directives of the Board of Directors of the Company. Employee represents and
warrants that he is free to accept this employment and will exercise his best
efforts in good faith with respect to his employment hereunder.
III. COMPENSATION. Employee shall be paid an annualized base salary of
$72,000, payable monthly, in arrears. During the term of this Agreement, the
Employee may be eligible to participate in performance bonuses and any qualified
or non-qualified stock option plans of the Company, as established by the
Compensation Committee of the Board of Directors of the Company. Stock Option
Incentives authorized for Employee pursuant to this agreement are as follows:
A. Signing Bonus. Upon signing of this Agreement, a one time stock grant of
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500,000 Series 2003A preferred shares of the Company.
B. Annual Stock Option. Pursuant to the terms of the Company's 2003 Stock
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Option Plan, the Company shall issue Employee annual stock options for the
exercise of common shares as established by the Compensation Committee of the
Board of Directors of the Company. The options shall be exercisable at 100% of
the fair market value of the common stock on the date of grant, and the first
such options shall be granted on or before March 31, 2004.
IV. EXPENSES. Subject to the Company's written employee expense
reimbursement policy, the Employee shall be entitled to reimbursement for all
reasonable expenses necessarily incurred by him in the performance of his duties
upon presentation of a voucher indicating the amount and business purpose and
supported by appropriate documentation. In addition, the Employee shall receive
a monthly car expense of $500.00.
V. BENEFITS. The Employee shall be eligible to participate in all of the
Company's health and welfare benefit programs. He shall be entitled to vacation
annually according to the Company's vacation policy, the timing of which shall
be agreed upon between the Employee and the Board of Directors of the Company
VI. TERMINATION. Notwithstanding any provision of the foregoing contract,
the Employee may be discharged only for Cause by the Board of Directors of the
Company at any time during the period of employment provided for in this
Agreement.
A. "Cause" shall mean a material breach of the terms of this Agreement,
including: (a) conviction of a felony involving moral turpitude; (b) theft from
the Company or any of its customers; (c) breach of the covenant of
non-competition and non-disclosure; (d) willful failure or refusal to carry out
the policies of the Company or any order or directive of the Board of Directors
of Citadel; or (e) the failure by the Employee to perform all of the material
duties and to comply with the material terms and conditions required of him
under this Agreement.
B. If the Employee is discharged for cause, or voluntarily leaves the employ
of the Company during the period of active employment specified herein, then and
in any such event, all subsequent compensation required to be paid by the
Company to the Employee shall be forfeited, and this contract and the rights of
the parties shall terminate.
C. In the event the Company otherwise terminates the Employee's employment,
the Company shall be obligated to pay Employee, as a lump sum severance payment,
an amount equal to one times the Employee's annual salary, payable in either
shares or cash at the Company's option within thirty (30) days of such
termination.
D. In the event of Employee's death, his employment shall be terminated
immediately and his spouse or assigns shall receive the proceeds of the Key Man
Life Insurance or other insurance policies maintained by the Company on Employee
as determined by the Compensation Committee of the Board of Directors of the
Company.
VII. ARBITRATION. All disputes, differences, or questions arising between
the parties hereto relating to construction, price, meaning, or effect of any
cause or thing contained herein, or the rights or liabilities of the parties
respectively, or their respective successors and assigns, shall be referred to
arbitration between the parties hereto, one arbitrator to be appointed by each
party, and the arbitrators so chosen, if by themselves unable to agree within
ten days after their appointment, choose an additional arbitrator, without
delay, and the decision in writing signed by a majority of such arbitrators,
unless patently erroneous, shall be binding upon the parties hereto. The general
procedure followed for arbitrators shall conform to the laws of the State of
Colorado. The unsuccessful party in the arbitration shall pay the
expenses/costs related thereto
VIII. NOTICE. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and if sent by certified or
registered mail, return receipt requested
IX. RULES OF CONSTRUCTION.
A. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between
the parties pertaining to the subject matter hereof and supercedes all
negotiations, prior agreements and contemporaneous agreements, discussions and
understandings of the parties in connection with the subject matter hereof.
B. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Colorado. Venue and Jurisdiction shall
be in Denver County, Colorado.
C. AMENDMENTS. No change, modification or termination of any of the terms,
provisions or conditions of this Agreement shall be effective unless made in
writing and signed by all parties hereto, their successors or assigns.
D. BINDING EFFECT ON SUCCESSORS AND ASSIGNS. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors, personal representatives, heirs and assigns.
E. DISCLOSURE. Employee agrees not to disclose the terms of this Agreement
to anyone during the term of this agreement except as required by law without
the express written consent of Citadel.
F. SEVERABILITY. If any Article, or other provision of this Agreement, or
the application thereof, is held to be invalid, illegal, or unenforceable in any
respect or for any reason, the remainder of this Agreement, and the application
of the Article, Section or Provision to a person or circumstance with respect to
which it is valid, legal or enforceable, shall not be affected thereby.
IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement
below, as of this 1st day of August, 2003.
THE COMPANY:
AGTSPORTS, INC.
BY: /s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx, President
THE EMPLOYEE:
XXXXX XXXXXXX
BY: /s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx
