EMPLOYMENT AGREEMENT
This
EMPLOYMENT AGREEMENT (this “Agreement”)
is
entered into as of May ___, 2007 by and between Quest Group International,
Inc.,
a Nevada corporation, with its principal office at 11845 West Olympic Boulevard,
No. 1125W, Xxx Xxxxxxx, Xxxxxxxxxx 00000 (the “Company”),
and
Rosh Chandraratna (“Executive,”
together with the Company, the “Parties”),
with
reference to the following facts:
WHEREAS,
Executive has experience and expertise applicable to employment with Company
to
perform as the Chief Scientific Officer of Company, Company has agreed to employ
Executive and Executive has agreed to enter into such employment, on the terms
set forth in this Agreement.
WHEREAS,
Executive acknowledges that this Agreement is necessary for the protection
of
Company’s investment in its business, good will, products, patents, inventions,
intellectual property, methods of operation, information, and relationships
with
its customers and other employees.
WHEREAS,
the Company desires to employ the Executive, and Executive desires to be
employed by Company pursuant to the terms hereof.
NOW,
THEREFORE, the Company and Executive desire to set forth in this Agreement
the
terms and conditions of the Executive's employment with the
Company.
ARTICLE
I
EMPLOYMENT;
TERM; DUTIES
1.1 Employment.
Upon
the terms and conditions hereinafter set forth, the Company hereby employs
Executive, and Executive hereby accepts employment, to serve as Chief Scientific
Officer of the Company, commencing June 4, 2007 (the “Commencement
Date”)
and,
subject to Section 4.2.1, ending five years thereafter (the “Term”).
1.2 Duties.
Executive shall report to the Chief Executive Officer (“CEO”)
of the
Company, and will have the general powers, duties and responsibilities of
management usually vested in that office in a corporation and such other powers
and duties as may be prescribed from time to time by the CEO or the Board of
Directors of the Company (the “Board”).
1.3 Standard
of Performance.
Executive agrees that he will at all times faithfully and industriously and
to
the best of his ability, experience and talents perform all of the duties that
may be required of and from him pursuant to the terms of this Agreement. Such
duties will be performed at such place or places as the interests, needs,
business and opportunities of Company will require or render advisable.
1.4 Duty
of Loyalty.
During
his employment with the Company, Executive shall not, directly or indirectly,
either as an employee, employer, consultant, agent, investor, principal,
partner, stockholder (except as the holder of less than 1% of the issued and
outstanding stock of a publicly held corporation), corporate officer or
director, or in any other individual or representative capacity, engage or
participate in any business that is in competition in any manner whatsoever
with
the business of the Company. Subject to the foregoing prohibition and provided
such services or investments do not violate any applicable law, regulation
or
order, or interfere in any way with the faithful and diligent performance by
Executive of the services to the Company otherwise required or contemplated
by
this Agreement, the Company expressly acknowledges that Executive
may:
(a) make
and
manage personal business investments of Executive’s choice without consulting
the Board; and
(b) serve
in
any capacity with any non-profit civic, educational or charitable organization
without consulting with the Board.
1.5 Covenants
of Executive
1.5.1 Reports.
Executive shall use his best efforts and skills to truthfully, accurately,
and
promptly make, maintain, and preserve all records and reports that the Company
may, from time to time, request or require, fully account for all money,
records, equipment, materials, or other property belonging to the Company of
which he may have custody, and promptly pay and deliver the same whenever he
may
be directed to do so by the Board.
1.5.2 Rules
and Regulations.
Executive shall obey all rules, regulations and special instructions of the
Company and all other rules, regulations, guides, handbooks, procedures,
policies and special instructions applicable to the Company’s business in
connection with his duties hereunder and shall endeavor to improve his ability
and knowledge of the Company’s business in an effort to increase the value of
his services for the mutual benefit of the Company and the
Executive.
1.5.3 Opportunities.
Executive shall make all business opportunities of which he becomes aware that
are relevant to the Company’s business available to the Company, and to no other
person or entity or to himself individually.
ARTICLE
II
COMPENSATION
2.1 Base
Salary.
During
the Term, for all services rendered by Executive hereunder and all covenants
and
conditions undertaken by both Parties pursuant to this Agreement, the Company
shall pay, and Executive shall accept, as compensation, an annual base salary
of
$250,000 per year commencing the Commencement Date (the “Base
Salary”),
payable in accordance with the normal payroll practices of the Company. The
Base
Salary shall be increased annually at the Company’s sole discretion, but by no
less than 5% per year.
2.2 Performance
and Review.
Executive’s performance will be reviewed on no less than an annual basis.
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2.3 Discretionary
Bonus.
Executive is eligible to receive an annual bonus during his employment. This
bonus will be based on the following two factors, each of which shall be given
equal weight in determining the bonus amount Executive will receive that
year:
(a) The
Company’s performance, based on the performance criteria established by the
Company’s Board of Directors in its sole discretion; and
(b) The
Executive’s job performance, based on the performance criteria established by
mutual agreement of Executive and the Chief Executive Officer, subject to review
and approval by the Board.
2.4 Fringe
Benefits.
Executive and Executive’s family will be provided with group dental insurance
through the Company’s plans. Dental benefits will commence on the first day of
the month following the Commencement Date. In the event that no benefit plans
are in place at that time, Company will reimburse Executive for COBRA coverage
until such time as Executive is covered under the Company’s group medical and
dental plans. For purposes of this Section 2.4, family shall include Executive’
spouse and dependents under the age of 24 living in the same household as
Executive.
2.5 Vacation
and Sick Days.
Executive shall be entitled to four (4) workweeks of paid time off
(“PTO”)
per
year commencing with the Commencement Date, provided, however, that Executive’s
accrued and unused PTO shall not exceed a total of five workweeks. This PTO
will
be in addition to normal Company holidays, which will be determined at the
discretion of the Company from time to time. Thereafter, Executive will not
continue to accrue PTO benefits until he has used enough PTO time to fall below
this maximum amount. Any accrued but unused PTO will be paid to Executive,
on a
pro rata basis, at the time that his employment is terminated. In addition
to
PTO, the Executive will be entitled to normal Company holidays.
2.6 Withholding.
The
Company may deduct from any compensation payable to Executive (including
payments made pursuant to Section 2 of this Agreement in connection with or
following termination of employment) amounts sufficient to cover Executive’s
share of applicable federal, state and/or local income tax withholding, old-age
and survivors’ and other social security payments, state disability and other
insurance premiums and payments.
2.7 Stock
Compensation.
At the
sole discretion of the Board, Executive may be eligible to receive awards under
the Company’s Stock Compensation Plan.
ARTICLE
III
BUSINESS
EXPENSES
3.1 Business
Expenses.
Executive will be reimbursed for all reasonable, out-of-pocket business expenses
incurred in the performance of his/her duties on behalf of the Company
consistent with the Company’s policies and procedures, including prior approval
requirements and submission of appropriate supporting documentation. Such
business expenses shall include travel, promotional, professional continuing
education and licensing costs (to the extent required), professional society
membership fees, seminars and similar expenditures incurred by Executive which
Company determines are reasonably necessary for the proper discharge of
Executive’s duties under this Agreement and for which Executive submits
appropriate receipts and indicates the amount, date, location and business
character in a timely manner.
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3.1.1 Executive
shall be entitled to “economy” class air travel accommodations and proper hotel
accommodations not to exceed 4 star. Executive shall be entitled to “business”
class air travel accommodations for flights that exceed 5 hours of continuous
air travel.
3.1.2 Prior
to
incurring any business expense that exceeds One Thousand Dollars (US$1,000),
Executive shall first seek written consent of the Chief Executive Officer.
ARTICLE
IV
TERMINATION
OF EMPLOYMENT
4.1 Termination
4.1.1 Executive’s
employment pursuant to this Agreement shall terminate on the earliest to occur
of the following:
(a) upon
the
death of Executive (“Death”);
(b) upon
the
delivery to Executive of written notice of termination by the Company if
Executive shall suffer a physical or mental disability or illness which renders
Executive, in the reasonable judgment of the Board, unable to perform his duties
and obligations under this Agreement for either 60 consecutive days or 180
days
in any 12-month period (“Disability”);
(c) upon
delivery to Company of written notice of termination by the Executive for Good
Reason; or
(d) upon
delivery to Executive of written notice of termination by the Company for
Cause.
4.2 Unless
either (a) this Agreement has been terminated prior to the expiration of
the Term, or (b) one party notifies the other party at least 60 calendar
days prior to the end of the Term (including the original Term or as the same
may have been previously extended) that such party does not wish such Term
to be
extended or further extended, this Agreement shall be automatically extended
upon the terms and conditions hereof for an additional year at the conclusion
of
the original or extended Term.
4.2.1 Notwithstanding
the foregoing Sections 4.1 and 4.2, either party to this Agreement may terminate
this Agreement prior to the expiration of the Term if the terminating party
notifies the other party at least 60 calendar days prior to the end of any
twelve month period ending May 31 (the “Year”).
4.3 Certain
Definitions.
For
purposes of this Agreement, the following terms shall have the following
meanings:
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4.3.1 “Cause”
shall
mean, in the context of a basis for termination of Executive’s employment with
the Company, that:
(a) Executive
has committed an act of actual fraud, moral turpitude, misappropriation of
funds
or embezzlement in connection with his duties under this Agreement;
(b) Executive
is convicted
of, or pleas nolo
contendere
(no
contest) to, any crime (whether or not involving the Company) constituting
a
felony in the jurisdiction involved;
(c) Executive’s
willful misconduct in the performance of Executive’s duties
hereunder;
(d) Executive’s
gross negligence in the performance of his duties hereunder or willful and
repeated failure or refusal to perform such duties as may be delegated to
Executive by Company commensurate with his position; or
(e) Executive
is in material breach of any provision of this Agreement, or willfully fails
to
or refuses to comply with the lawful directives of the Chief Executive Officer
or the Board in the performance of his duties under this Agreement (other than
a
failure caused by temporary disability).
4.3.2 “Good
Reason”
giving
rise to Executive’s right to terminate this Agreement means if
Executive claims that Company has materially breached this Agreement, Executive
shall have first provided written notice to Company of any such claimed material
breach with exact details of the claimed material breach and Company shall
have
had thirty (30) days from the date of receipt of such written notice to cure
any
such breach; if curable, and in the event Company does so cure such breach
within said thirty (30) days, such claimed breach shall not constitute good
reason or a breach of this Agreement.
4.4 Effect
of Termination
4.4.1 Executive
acknowledges that in the event of termination of his employment for any reason
listed under Sections 4.1 and 4.2, Executive shall not be entitled to any
severance or other compensation from the Company. Without limitation on the
generality of the foregoing, this Section supersedes any plan or policy of
the
Company that provides for severance to its officers or employees, and Executive
shall not be entitled to any benefits under any such plan or
policy.
4.4.2 Subject
to Section 4.4.1, in the event Executive is terminated without Cause, the
Company shall continue to pay to Executive the compensation provided for under
Section 2.1 for the remainder of the Year of such termination.
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ARTICLE
V
CONFIDENTIAL
INFORMATION; NON-SOLICITATION; INTELLCTUAL PROPERTIES
5.1 Trade
Secrets of Company.
Executive, during the Term, will develop, have access to and become acquainted
with various trade secrets which are owned by Company and/or its affiliates
and
which are regularly used in the operation of the businesses of such entities.
Executive will not disclose such trade secrets, directly or indirectly, or
use
them in any way, either during the Term or at any time thereafter, except as
required in the course of his employment by Company. All files, contracts,
manuals, reports, letters, forms, documents, notes, notebooks, lists, records,
documents, customer lists, vendor lists, purchase information, designs, computer
programs and similar items and information, relating to the businesses of such
entities, whether prepared by Executive or otherwise and whether now existing
or
prepared at a future time, coming into his possession will remain the exclusive
property of such entities, and will not be removed, other than work-related
purposes, from the premises where the work of Company is conducted, except
with
the prior written authorization by Company.
5.2 Confidential
Data of Customers of Company.
Executive, in the course of his duties, will have access to and become
acquainted with financial, accounting, statistical and personal data of
customers of Company and of their affiliates. All such data is confidential
and
will not be disclosed, directly or indirectly, or used by Executive in any
way,
either during the Term (except as required in the course of employment by
Company) or at any time thereafter.
5.3 Inevitable
Disclosure.
After
Executive’s employment has terminated for Cause or without Good Reason,
Executive will not accept employment with any direct competitor of Company
for a
period of one (1) year, where the new employment is likely to result in the
inevitable disclosure of Company’s trade secrets or confidential information, or
it would be impossible for Executive to perform his new job without using or
disclosing trade secrets or confidential information.
5.4 Limited
Exceptions.
Notwithstanding the foregoing, no information will be considered trade secret
or
confidential to the extent it is or becomes publicly available without breach
of
this Agreement by Executive, is rightfully received by Executive without
obligations of confidentiality, or is ordered released or disclosed by court
order, lawful process or government authority.
5.5 No
Solicitation.
Executive agrees that he will not, during the Term and for one (1) year
thereafter if terminated without Cause or with Good Reason or for two (2) years
thereafter if terminated with for Cause or without Good Reason, encourage or
solicit any other employee of Company to terminate his or her employment for
any
reason, nor will he assist others to do so.
5.6 Intellectual
Properties.
The
Executive has signed a separate innovation, proprietary information and
confidentiality agreement with the Company.
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5.7 Continuing
Effect.
The
provisions of this Section
5
will
remain in effect after the Termination Date.
ARTICLE
VI
MISCELLANEOUS
6.1 Binding
Effect; Assignment.
This
Agreement shall be binding upon and inure to the benefit of the Parties and
their respective legal representatives, heirs, distributees, successors and
assigns. Executive may not assign any of his rights and obligations under this
Agreement. The Company may assign its rights and obligations under this
Agreement to any successor entity.
6.2 Notices.
Any
notice provided for herein shall be in writing and shall be deemed to have
been
given or made (a) when personally delivered or (b) when sent by telecopier
and
confirmed within 48 hours by letter mailed or delivered to the party to be
notified at its or his/hers address set forth herein; or three days after being
sent by registered or certified mail, return receipt requested, (or by
equivalent xxxxxxx with delivery documentation such as FEDEX or UPS) to the
address of the other party set forth or to such other address as may be
specified by notice given in accordance with this section 6.2:
If
to the Company:
|
Quest
Group International, Inc.
00000
Xxxx Xxxxxxx Xxxxxxxxx, Xx. 0000X
Xxx
Xxxxxxx, Xxxxxxxxxx 00000
Telephone: (000)
000-0000
Facsimile: (000)
000-0000
Attention: Chief
Executive Officer
|
If
to Executive:
|
Rosh
Chandraratna
____________________________
____________________________
Telephone: (___)
_____________
Facsimile: (___)
______________
|
6.3 Severability.
If any
provision of this Agreement, or portion thereof, shall be held invalid or
unenforceable by a court of competent jurisdiction, such invalidity or
unenforceability shall attach only to such provision or portion thereof, and
shall not in any manner affect or render invalid or unenforceable any other
provision of this Agreement or portion thereof, and this Agreement shall be
carried out as if any such invalid or unenforceable provision or portion thereof
were not contained herein. In addition, any such invalid or unenforceable
provision or portion thereof shall be deemed, without further action on the
part
of the parties hereto, modified, amended or limited to the extent necessary
to
render the same valid and enforceable.
6.4 Waiver.
No
waiver by a party hereto of a breach or default hereunder by the other party
shall be considered valid, unless expressed in a writing signed by such first
party, and no such waiver shall be deemed a waiver of any subsequent breach
or
default of the same or any other nature.
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6.5 Entire
Agreement.
This
Agreement sets forth the entire agreement between the Parties with respect
to
the subject matter hereof, and supersedes any and all prior agreements between
the Company and Executive, whether written or oral, relating to any or all
matters covered by and contained or otherwise dealt with in this Agreement.
This
Agreement does not constitute a commitment of the Company with regard to
Executive’s employment, express or implied, other than to the extent expressly
provided for herein.
6.6 Amendment.
No
modification, change or amendment of this Agreement or any of its provisions
shall be valid, unless in writing and signed by the party against whom such
claimed modification, change or amendment is sought to be enforced.
6.7 Authority.
The
Parties each represent and warrant that it/he or she has the power, authority
and right to enter into this Agreement and to carry out and perform the terms,
covenants and conditions hereof.
6.8 Attorneys’
Fees.
If
either party hereto commences an arbitration or other action against the other
party to enforce any of the terms hereof or because of the breach by such other
party of any of the terms hereof, the prevailing party shall be entitled, in
addition to any other relief granted, to all actual out-of-pocket costs and
expenses incurred by such prevailing party in connection with such action,
including, without limitation, all reasonable attorneys’ fees, and a right to
such costs and expenses shall be deemed to have accrued upon the commencement
of
such action and shall be enforceable whether or not such action is prosecuted
to
judgment.
6.9 Titles.
The
titles of the sections of this Agreement are inserted merely for convenience
and
ease of reference and shall not affect or modify the meaning of any of the
terms, covenants or conditions of this Agreement.
6.10 Applicable
Law; Choice of Forum.
This
Agreement, and all of the rights and obligations of the parties in connection
with the employment relationship established hereby, shall be governed by and
construed in accordance with the substantive laws of the State of California
without giving effect to principles relating to conflicts of law.
6.11 Arbitration.
6.11.1 Scope.
To the
fullest extent permitted by law, Executive and the Company agree to the binding
arbitration of any and all controversies, claims or disputes between them
arising out of or in any way related to this Agreement, the employment
relationship between the Company and Executive and any disputes upon termination
of employment, including but not limited to breach of contract, tort,
discrimination, harassment, wrongful termination, demotion, discipline, failure
to accommodate, family and medical leave, compensation or benefits claims,
constitutional claims; and any claims for violation of any local, state or
federal law, statute, regulation or ordinance or common law. For the purpose
of
this agreement to arbitrate, references to “Company” include all parent,
subsidiary or related entities and their employees, supervisors, officers,
directors, agents, pension or benefit plans, pension or benefit plan sponsors,
fiduciaries, administrators, affiliates and all successors and assigns of any
of
them, and this agreement to arbitrate shall apply to them to the extent
Executive’s claims arise out of or relate to their actions on behalf of the
Company.
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6.11.2 Arbitration
Procedure.
To
commence any such arbitration proceeding, the party commencing the arbitration
must provide the other party with written notice of any and all claims forming
the basis of such right in sufficient detail to inform the other party of the
substance of such claims. In no event shall this notice for arbitration be
made
after the date when institution of legal or equitable proceedings based on
such
claims would be barred by the applicable statute of limitations. The arbitration
will be conducted in Los Angeles, California, by a single neutral arbitrator
and
in accordance with the then-current rules for resolution of employment disputes
of the American Arbitration Association (“AAA”).
The
Arbitrator is to be selected by the mutual agreement of the Parties. If the
Parties cannot agree, the Superior Court will select the arbitrator. The parties
are entitled to representation by an attorney or other representative of their
choosing. The arbitrator shall have the power to enter any award that could
be
entered by a judge of the trial court of the State of California, and only
such
power, and shall follow the law. The award shall be binding and the Parties
agree to abide by and perform any award rendered by the arbitrator. The
arbitrator shall issue the award in writing and therein state the essential
findings and conclusions on which the award is based. Judgment on the award
may
be entered in any court having jurisdiction thereof. The Company shall bear
the
costs of the arbitration filing and hearing fees and the cost of the
arbitrator.
6.12 This
Agreement shall not be terminated by any voluntary or involuntary dissolution
of
the Company resulting from either a merger or consolidation in which the Company
is not the consolidated or surviving corporation, or a transfer of all or
substantially all of the assets of the Company. In the event of any such merger
or consolidation or transfer of assets, Executive’s rights, benefits and
obligations hereunder shall be assigned to the surviving or resulting
corporation or the transferee of the Company’s assets.
[Signature
page to follow]
9
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day
and year first above written.
/s/
Rosh
Chandraratna
Rosh
Chandraratna |
Quest
Group International, Inc.
By:
/s/ Xxxxx
Xxxxx-Xxxxxx
Name: Xxxxx
Xxxxx-Xxxxxx
Title:
Chief Executive Officer
|
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