EXHIBIT 10.25
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is made by and between TechAlt,
Inc., a corporation duly organized and existing under the laws of the State of
Nevada (the "Company"), and Xxx Xxxxxx, an individual residing in the State of
Illinois ("Executive").
RECITALS
WHEREAS, the has experience and expertise in accounting and financing
for small and medium-size publicly held companies; and
WHEREAS, the Company and Executive have determined that it is in their
respective best interest to enter into this Agreement on the terms and
conditions as set forth herein; and
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and promises contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:
1. Nature of Agreement.
1.1. Cancellation of Prior Offers. Any and all prior oral
understandings, offers, and/or representations (if any) with respect to the
employment of Executive are deemed by the parties to be either canceled and void
and/or are deemed to be superseded by this final written Agreement.
2. Employment Terms and Duties.
2.1. Term of Employment. The employment of Executive under this
Agreement shall be deemed to have commenced on January 15, 2006 (the "Effective
Date"), and shall continue for a period of one (1) year (the "Initial Term").
This Agreement shall be automatically renewed for additional consecutive one (1)
year periods (the "Renewal Term," and together with the Initial Term, the
"Employment Term") unless written notice of the intention to let this Agreement
expire is provided by the Company to Executive thirty (30) days prior to the
expiration of the Initial Term (or prior to the expiration of the Renewal Term
in the event of a renewal).
2.2. Location. Executive agrees that he shall carry out his duties and
obligations under the terms of this Agreement at his home office, or the
Company's principal office as required by the Company.
2.3. Position and Primary Responsibility. It is understood that
Executive shall serve as Internal Accountant and Financial Manager of the
Company.
3. Compensation.
3.1. Base Compensation. In consideration for the services rendered to
the Company hereunder by Executive and Executive's covenants hereunder, the
Company shall, during the Employment Term, pay Executive compensation at the
initial rate of two hundred fifty thousand (250,000) options for the purchase of
common stock of the Company (the "Options"), which shares shall be registered on
Form S-8 ("Base Compensation"). The Options shall have an exercise price of
$.001 and shall be exercisable on a cashless basis at the Executive's option.
Shares issued pursuant to the exercise of options in connection with this
Agreement shall be issued to Xxx Xxxxxx, the natural person performing the
employment services for the Company. All shares and certificates representing
such shares shall be subject to applicable SEC, federal, state (Blue sky) and
local laws and additional restrictions set forth herein.
3.2. Payment. All compensation payable to Executive hereunder shall be
subject to the Company's rules and regulations, and shall also be subject to all
applicable State and federal employment law(s); it being understood that
Executive shall be responsible for the payment of all taxes resulting from a
determination that any portion of the compensation and/or benefits paid/received
hereunder is a taxable event to Executive; it being further understood that
Executive shall hold the Company harmless from any governmental claim(s) for
Executive's personal tax liabilities, including interest or penalties, arising
from any failure by Executive to pay his individual taxes when due.
3.3. Compensation Review. It is understood and agreed that Executive's
performance will be reviewed by the Company's Board of Directors on a monthly
basis during the Employment Term of this Agreement is in force for the purpose
of determining whether or not Executive's Base Compensation should be modified
and/or adjusted; it being further understood that the decision to increase
Executive's compensation shall be at the sole and exclusive option of the Board
of Directors.
4. Benefits.
4.1. Reimbursement for Business Expenses. The Company shall reimburse
Executive for all reasonable business expense(s) actually incurred prior to and
after the Effective Date of this Agreement by Executive on behalf of the Company
in the performance of his duties hereunder upon presentation by Executive of
voucher(s), receipt(s) or other written evidence(s) in accordance with the
policies of the Company and the rules of the Internal Revenue Service. This
includes reimbursement for reasonable business expenses incurred by Executive
while working from his home office, such as telephone, fax and internet
services, and general office supplies.
4.2. Indemnification. The Company agrees to indemnify Executive to the
fullest extent permitted by law and by the Company's By-Laws, and specifically
acknowledges indemnification including reasonable attorneys' fees to the extent
that such action arises out of the preparation and filing of the Form 10-QSB for
the 2nd Q FY2006 and Form 10KSA/A for FY2004, expect where such action arises
out of the willful misconduct of Consultant. . The Company will maintain
appropriate Directors and Officers insurance at all times.
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4.3. Illness or Personal Leave.Executive shall be entitled to five (5)
days per year as sick leave or personal leave with full pay. Sick or personal
leave may not be accumulated from year to year.
4.4. Paid Holidays. Executive shall be entitled to a holiday on the
following days, with full pay: New Year's Day, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day, the Friday after Thanksgiving Day and Christmas
Day.
5. Confidential Information and Records.
5.1. Executive represents that his employment with the Company under
the terms of this Agreement will not conflict with any continuing duty(ies) or
obligation(s) Executive has with any other person(s), firm(s) and/or
entity(ies). Executive also represents that he has not brought to the Company
(during the period before or after the Effective Date of this Agreement) any
material(s) and/or document(s) of any former employer(s), or any confidential
information or property belonging to other(s).
5.2. Executive also represents to the Company that during the term of
this Agreement, he will not, directly or indirectly, without the express prior
written approval of the Board of Directors of the Company, engage or be
interested in any business that is in competition with the business of the
Company (whether as a principal, lender, employee, Officer, Director, partner,
venturer, consultant or otherwise).
6. Termination. Executive's employment and this Agreement (except as otherwise
provided hereunder) shall terminate upon the occurrence of any of the following,
at the time set forth therefor (the "Termination Date"):
6.1 Voluntary Termination. Fourteen (14) days following Executive's
written notice to the Company of voluntary termination of employment; provided,
however, that the Company may waive all or a portion of the Fourteen (14) days'
notice and accelerate the effective date of such termination (and the
Termination Date) (termination pursuant to this Section 6.2 being referred to
herein as "Voluntary" termination); or
6.2 Termination For Cause. Immediately following notice of termination
for "Cause" (as defined below), specifying such Cause, given by the Company
(termination pursuant to this Section 6.2 being referred to herein as
termination for "Cause"). As used herein, "Cause" means (i) termination based on
Consulting Executive's conviction or plea of "guilty" or "no contest" to any
crime constituting a felony in the jurisdiction in which the crime constituting
a felony is committed, any crime involving moral turpitude (whether or not a
felony), or any other violation of criminal law involving dishonesty or willful
misconduct that materially injures the Company (whether or not a felony); (ii)
Consulting Executive's substance abuse that in any manner interferes with the
performance of his duties; (iii) Consulting Executive's failure or refusal to
perform his duties at all or in an acceptable manner, or to follow the lawful
and proper directives of the Board of Directors or Consulting Executive's
supervisor(s) that are within the scope of Consulting Executive's duties; (iv)
Consulting Executive's breach of this agreement; (v) Consulting Executive's
breach of the Company's Confidentiality, Proprietary Information and Inventions
policies; (vi) misconduct by Consulting Executive that has or could discredit or
damage the Company; (vii) Consulting Executive's indictment for a felony
violation of the federal securities laws; or (viii) Consulting Executive's
chronic absence from work for reasons other than illness. Any determination of
for Cause termination shall be made by the Board of Directors of the Company
after having first given thirty (30) days written notice to Consulting Executive
of such determination, and afforded Consulting Executive the opportunity to be
heard by the full Board of Directors. Notwithstanding any other provision in
this Agreement, if Consulting Executive is terminated pursuant to subsection
(iii) of this Section 6.2 for poor job performance, excluding refusal to perform
his duties, Consulting Executive shall have sixty (60) days to cure the behavior
upon which the threatened termination is based.
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6.3 Termination Without Cause. Notwithstanding any other provisions
contained herein, the Company may terminate Executive's employment fourteen (14)
days following notice of termination without Cause given by the Company;
provided, however, that during any such fourteen (14) day notice period, the
Company may suspend, with no reduction in pay or benefits, Executive from his
duties as set forth herein (including, without limitation, Executive's position
as a representative and agent of the Company) (termination pursuant to this
Section 6.4 being referred to herein as termination "Without Cause").
6.4 Other Remedies. Termination pursuant to Section 6.3 above shall be
in addition to and without prejudice to any other right or remedy to which the
Company may be entitled at law, in equity, or under this Agreement.
7. Severance and Termination.
7.1. Voluntary Termination, Termination for Cause, Termination for
Death or Disability. In the case of a termination of Executive's employment
hereunder for Death in accordance with Section 6.1 above, or Executive's
Voluntary termination of employment hereunder in accordance with Section 6.2
above, or a termination of Executive's employment hereunder for Cause in
accordance with Section 6.3 above, (i) Executive shall not be entitled to
receive payment of, and the Company shall have no obligation to pay, any
severance or similar compensation attributable to such termination, other than
Base compensation earned but unpaid, accrued but unused vacation to the extent
required by the Company's policies and any non-reimbursed expenses pursuant to
Section 4 hereof incurred by Executive as of the termination date, and (ii) the
Company's obligations under this Agreement shall immediately cease. Provided
further, in the event of Executive's Voluntary termination of employment
hereunder in accordance with Section 6.2 above, or a termination of Executive's
employment hereunder for Cause in accordance with Section 6.3 above, Executive
shall tender back to the Company all unvested options granted to Executive by
the Company in connection with Executive's employment.
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8. Severance Conditioned on Release of Claims.
The Company's obligation to provide Executive with any severance
payment shall be addressed in further good faith negotiations and contingent
upon Executive's execution of a satisfactory release of claims in favor of the
Company.
9. Inventions, Discoveries and Improvements.
9.1. Any and all invention(s), discovery(ies) and improvement(s),
whether protectible or unprotectible by Patent, trademark, copyright or trade
secret, made, devised, or discovered by Executive, whether by Executive alone or
jointly with others, from the time of entering the Company's employ until the
earlier of the Termination Date of this Agreement or the actual date of
termination of employment, relating or pertaining in any way to Executive's
employment with the Company, shall be promptly disclosed in writing to the Board
of Directors of the Company, and become and remain the sole and exclusive
property of the Company. Executive agrees to execute any assignments to the
Company, or its nominee, of the Executive's entire right, title, and interest in
and to any such inventions, discoveries and improvements and to execute any
other instruments and documents requisite or desirable in applying for and
obtaining Patents, trademarks or copyrights at the cost of the Company, with
respect thereto in the United States and in all foreign countries, that may be
requested by the Company. Executive further agrees, whether or not then in the
employment of the Company, to cooperate to the fullest extent and in the manner
that may be reasonably requested by the Company in the prosecution and/or
defense of any suit(s) involving claim(s) of infringement and/or
misappropriation of proprietary rights relevant to Patent(s), trademark(s),
copyright(s), trade secret(s), processes, and/or discoveries involving the
Company's product(s); it being understood that all reasonable costs and expenses
thereof shall be paid by the Company. The Company shall have the sole right to
determine the treatment of disclosures received from Executive, including the
right to keep the same as a trade secret, to use and disclose the same without a
prior Patent Application, to file and prosecute United States and foreign Patent
Application(s) thereon, or to follow any other procedure which the Company may
deem appropriate. In accordance with this provision, Executive understands and
is hereby further notified that this Agreement does not apply to an invention
which the employee developed entirely on his own time without using the
Company's equipment, supplies, facilities, or trade secret information.
10. Confidential Information and Trade Secrets.
10.1. Confidentiality. Consulting Executive hereby acknowledges that
all trade, engineering, production, and technical data, information or
"know-how" including, but not limited to, customer lists, sales and marketing
techniques, vendor names, purchasing information, processes, methods,
investigations, ideas, equipment, tools, programs, costs, product profitability,
plans, specifications, Patent Application(s), drawings, blueprints, sketches,
layouts, formulas, inventions, processes and data, whether or not reduced to
writing, used in the development and manufacture of the Company's products
and/or the performance of services, or in research or development, are the
exclusive secret and confidential property of the Company, and shall be at all
times, whether after the Effective Date or after the Termination Date, be kept
strictly confidential and secret by Consulting Executive.
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10.2. Return of Property. Consulting Executive agrees not to remove
from the Company's office or copy any of the Company's confidential information,
trade secrets, books, records, documents or customer or supplier lists, or any
copies of such documents, without the express written permission of the Board of
Directors of the Company. Consulting Executive agrees, at the Termination Date,
to return any property belonging to the Company, including, but not limited to,
any and all records, notes, drawings, specifications, programs, data and other
materials (or copies thereof) pertaining to the Company's businesses or its
product(s) and service(s), generated or received by Consulting Executive during
the course of his employment with the Company.
10.3. Non-Disclosure. Consulting Executive represents and agrees that
during the term of this Agreement, and after the Termination Date, he will not
report, publish, disclose, use, or transfer to any person(s) or entity(ies) any
property or information belonging to the Company without first having obtained
the prior express written consent of the Company to do so; it being understood,
however, that information which was publicly known, or which is in the public
domain, or which is generally known, shall not be subject to this restriction.
11. Information of Others.
11.1 Executive agrees that the Company does not desire to acquire from
Executive any secret or confidential information or "know-how" of others.
Executive, therefore, specifically represents to the Company that he will not
bring to the Company any materials, documents, or writings containing any such
information. Executive represents and warrants that from the Effective Date of
this Agreement he is free to divulge to the Company, without any obligation to,
or violation of, the rights of others, information, practices and/or techniques
which Executive will describe, demonstrate or divulge or in any other manner
make known to the Company during Executive's performance of services. Executive
also agrees to indemnify and hold the Company harmless from and against any and
all liabilities, losses, costs, expenses, damages, claims or demands for any
violation of the rights of others as it relates to Executive's misappropriation
of secrets, confidential information, or "know-how" of others.
12. Notice.
12.1. Notices. All notices and other communications under this
Agreement shall be in writing and shall be delivered personally or mailed by
registered or certified mail, return receipt requested, and shall be deemed
given when so delivered or mailed, to a party at his or its address as follows
(or at such other address as a party may designate by notice given hereunder):
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If to Executive: Xxx Xxxxxx
0000 XX Xxxxxxxxxx
Xxxx Xxxxxxx, XX 00000
If to the Company: Xxxxx X. Xxxx
The Xxxx Law Group, PLLC
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
With a copy to:
The Xxxx Law Group, PLLC
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
13. Suit, Jurisdiction.
Any controversy between the Company and Executive arising out of or
relating to any of the terms, provisions or conditions of this Agreement shall
be submitted to arbitration in accordance with the American Arbitration
Association's National Arbitration Rules for the Resolution of Employment
Disputes. On the written request of either party for arbitration of such a claim
pursuant to this paragraph, the Company and Executive shall both be deemed to
have waived the right to litigate the claim in any federal or state court. To
the extent that any claim or controversy arising out of this Agreement cannot be
submitted to arbitration as set forth above, each party hereby agrees that any
suit, action or proceeding with respect to this Agreement, and any transactions
relating hereto, shall be brought in the State of Washington, King County, and
each of the parties hereby irrevocably consents and submits to the jurisdiction
of such Court(s) for the purpose of any such suit, action or proceeding. Each of
the parties hereby waives and agrees not to assert, by way of motion, as a
defense or otherwise, in any such suit, action or proceeding; any claim that it
(he) is not personally subject to the jurisdiction of the above-named Court(s);
and, to the extent permitted by applicable law, any claim that such suit, action
or proceeding is brought in an inconvenient forum or that the venue of such
suit, action or proceeding is improper or that this Agreement or any
replacements hereof or thereof may not be enforced in or by such Court(s). The
Company shall pay any and all costs associated with arbitration.
14. Miscellaneous.
14.1. Post Termination Obligations. Notwithstanding the termination of
Executive's employment hereunder, the provision(s) of Section(s) "5," "9," "10,"
"11," and "14" shall survive the Termination Date.
14.2. Assignment. This Agreement shall be assigned to and inure to the
benefit of, and be binding upon, any successor to substantially all of the
assets and business of the Company as a going concern, whether by merger,
consolidation, liquidation or sale of substantially all of the assets of the
Company or otherwise. Executive understands and agrees, however, that this
Agreement is exclusive and personal to his only, and, as such, he will neither
assign nor subcontract all or part of his undertaking(s) or obligation(s) under
the terms of this Agreement.
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14.3. Entire Agreement. Each party acknowledges that this Agreement
constitutes the entire understanding between them, and that there are no other
written or verbal agreement(s) or understanding(s) between them other than those
set forth herein; it being understood that no amendment(s) to this Agreement
shall be effective unless reduced to writing and signed by each party hereto.
14.4. Severability. In the event that any provision of this Agreement
shall be determined to be unenforceable or otherwise invalid, the balance of the
provision(s) shall be deemed to be enforceable and valid; it being understood
that all provision(s) of this Agreement are deemed to be severable, so that
unenforceability or invalidity of any single provision will not affect the
remaining provision(s).
14.5. Headings. The Section(s) and paragraph heading(s) in this
Agreement are deemed to be for convenience only, and shall not be deemed to
alter or affect any provision herein.
14.6. Interpretation of Agreement. This Agreement shall be interpreted
in accordance plain meaning of its terms and under the laws of the State of
Washington.
14.7. Variation. Any changes in the Sections relating to salary, bonus,
or other material condition(s) after the Effective Date of this Agreement shall
not be deemed to constitute a new Agreement. All unchanged terms are to remain
in force and effect.
14.8. Unenforceability. The unenforceability or invalidity of any
provision(s) of this Agreement shall not affect the enforceability and/or the
validity of the remaining provision(s).
14.9. Collateral Documents. Each party hereto shall make, execute and
deliver such other instrument(s) or document(s) as may be reasonably required in
order to effectuate the purposes of this Agreement.
14.10. Written Policies and Procedures. The Company's written policies
and procedures, as codified and contained in the Company "Handbook," are deemed
to be incorporated herein by this reference.
14.11. Non-Impairment. This Agreement may not be amended or
supplemented at any time unless reduced to a writing executed by each party
hereto. No amendment, supplement or termination of this Agreement shall affect
or impair any of the rights or obligations which may have matured thereunder.
14.12. Execution. This Agreement may be executed in one or more
counterpart(s), and each executed counterpart(s) shall be considered by the
parties as an original.
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14.13. Legal Counsel. Executive represents to the Company that he has
retained legal counsel of his own choosing, and was given sufficient opportunity
to obtain legal counsel prior to executing this Agreement. Executive also
represents that he has read each provision of this Agreement and understands its
meaning.
14.14. Effect of Merger, Transfer of Assets, Dissolution. 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, the Company's rights, benefits, and
obligations hereunder shall be assigned to the surviving or resulting
corporation or the transferee of the Company's assets.
14.15. Transition. In the event that Executive's employment with the
Company terminates, Executive shall, through the last day of employment, and at
the Company's request, use Executive's reasonable best efforts (at the Company's
expense) to assist the Company in transitioning Executive's duties and
responsibilities to Executive's successor and maintaining the Company's
professional relationship with all customers, suppliers, etc. Without limiting
the generality of the foregoing, Executive shall cooperate and assist the
Company, at the Company's direction and instruction, during the transition
period between any receipt of or giving of notice of the termination of
employment and the final day of employment.
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IN WITNESS WHEREOF, the parties hereto have set their hands the day and
year written below.
THE COMPANY:
TECHALT, INC.
Date:
------------------------------------ ----------------------------
By: Xxxxx X. Xxxx
Its: Director and Executive Officer
EXECUTIVE:
Date:
------------------------------------ ----------------------------
By: Xxx Xxxxxx
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EXHIBIT A
OPTION EXERCISE FORM
I, _____________________________, do hereby exercise the Option with a
Date of Grant of ___________________, ______ granted to me pursuant to the
Option Agreement. The Shares being purchased and the Total Exercise Price are
set forth below:
Number of Shares: ________________ Shares
Exercise Price Per Share x $ ____________ per Share
Total Exercise Price: = $ ____________.
The Total Exercise Price is included with this Form.
_____ By marking this with an "X", the Employee indicates his or her choice to
exercise these options on a cashless basis.
____________________________________ Date: ___________________
Signature
Send or deliver this Form with an original signature to
The Xxxx Law Group, PLLC
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
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