EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into, effective as
of March 19, 1999, between DOGWOOD TREE CAPITAL CORP., a Florida corporation
("Employer"), and XXXXXXX X. XXXX ("Employee").
R E C I T A L S
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A. Employer desires to engage in various aspects of web development
services business, including Internet based seminars and training and the
up-sale of miscellaneous products and services.
B. Employee desires to join the Employer as its President and Chief
Executive Officer.
C. To set forth the terms and conditions of his employment with the
Employer, the Employee desires to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements set forth herein, Employer and Employee, intending to
be legally bound, hereby agree as follows:
A G R E E M E N T
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1. TERM OF EMPLOYMENT. Employer hereby employs Employee, and Employee
hereby accepts employment with Employer, for a period of three (3) years
starting on April 19, 1999 and terminating April 18, 2002 ("Employment Period");
provided that this Agreement shall be automatically renewed for successive one
(1) year terms unless either party elects not to renew this Agreement by
delivering written notice of its election to the other party no later than
ninety (90) days prior to the end of the current term. Notwithstanding anything
in this Section 1 to the contrary, this Agreement may be terminated at any time
in accordance with Section 6.
2. DUTIES OF EMPLOYEE. Employee shall serve in the capacity as
President and Chief Executive Officer of Employer at Employer's office in San
Diego, California or Houston, Texas, or at such other place as Employer may
direct; provided that Employer shall not direct or cause Employee to perform his
services from an office outside of San Diego County, California, except for
periods of travel that are deemed necessary for purposes of fulfilling
Employee's responsibilities hereunder. Employee shall have the responsibility to
generally and actively supervise and manage all the business activities and
functions of the Employer and its subordinate officers, agents and employees.
Except during vacation periods or in accordance with Employer's personnel
policies covering executive leaves and reasonable periods of illness or other
incapacitation, Employee shall devote his services to Employer's business and
interests in a manner consistent with Employee's title and office and Employer's
needs for his services. Employee shall perform the duties of Employee's office
and those assigned to Employee by the Employer's board of directors with
fidelity, to the best of Employee's ability, and in the best interest of
Employer. During the term of this Agreement, the Employee shall devote his
entire productive time, attention, knowledge and skill to the business and
interest of the Employer as contemplated in this Agreement. The Employee further
agrees to devote all of his skills and efforts to the performance of, and to
perform diligently and on a timely basis, such duties as shall be assigned to
the employee from time to time by the Employer's board of directors so long as
such other services and duties are not inconsistent with any other term of this
Agreement.
3. COMPENSATION OF EMPLOYEE. As compensation for Employee's services
hereunder, Employee shall receive a base salary of Eight Thousand Three Hundred
Thirty-Three Dollars and Thirty-Four Cents ($8,333.34) per month, payable in
bi-monthly installments of Four Thousand One Hundred Sixty-Six Dollars and
Sixty-Seven Cents ($4,166.67) each, or a ratable portion thereof for periods of
less than one-half month. Such salary shall be adjusted to reflect Employee's
responsibility at such time when either the Employer has raised sufficient
capital or Employer's profits can warrant such. Salary shall be adjusted to be
commensurate with presidents and chief executive officers of similar public
organizations but shall be no less than $200,000 per year plus company
automobile. Employee shall determine the date of such adjustments by given the
Board of Directors thirty (30) days' notice.
4. EXPENSE REIMBURSEMENTS. Employee shall be reimbursed for reasonable
and actual out-of-pocket expenses incurred by Employee in performance of
Employee's duties and responsibilities hereunder in accordance with Employer's
established personnel policy covering executive officer expense reimbursements,
as such policy may be amended, revised or otherwise changed from time to time.
Employee shall furnish proper vouchers and expense reports and shall be
reimbursed only for those expenses which shall be reimbursable. Expenses include
all business related travel, hotel, auto, meals, etc., including all expenses
for Employee travel between San Diego and Houston.
5. VACATION, SICK LEAVE, OTHER FRINGE BENEFITS, RELOCATION AND STOCK
OPTIONS.
5.1 VACATION, SICK LEAVE AND OTHER FRINGE BENEFITS. Employee
shall be entitled to two (2) weeks vacation per every twelve (12) month period
of employment hereunder. Employee shall also be entitled to leaves for illness
or other incapacitation as is consistent with Employee's title and Employer's
needs for Employee's services, except as otherwise provided for in Section 6.2.
Employee shall be entitled during Employee's employment hereunder to share or
participate in such medical insurance programs or other "fringe" benefit plans
or programs as shall be made available to executive officers employed by
Employer generally, in accordance with Employer's established personnel
policies, if any, or as established, amended, revised or otherwise changed from
time to time, covering executive officer employee benefits.
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5.2 RELOCATION. Employer agrees to pay all relocation expenses
for Employee and his immediate family to relocate from Houston to the San Diego
area. Such expenses shall follow IRS guidelines for relocation expenses and
shall include but not be limited to: closing costs on sale of Employee's
existing home in Houston, corporate purchase of existing home at fair market
value, closing costs on purchase of new home in San Diego area, moving expenses,
temporary housing, transportation, etc. Such relocation shall occur when
Employer has sufficient capital. Additionally, Employer shall equalize the
increase in the cost of housing from Houston to San Diego by loaning Employee
the difference of the cost of similar housing. Such loan shall be secured by a
second lien on the housing purchased and shall have a 15 year term with a six
percent annual interest rate. All interest shall be accrued and bonused to
Employee on an annual basis with all principal due in 15 years.
5.3 STOCK OPTIONS. Employer agrees to grant Employee 300,000
stock options at $1.00 per share to purchase Employer common stock. Such options
shall be mutually agreed and are an integral part of this Employment Agreement.
Employer agrees to also review Employee's performance on an annual basis for
consideration of additional stock options.
6. TERMINATION.
6.1 TERMINATION BY EMPLOYER FOR CAUSE. Employer may terminate
this Agreement and Employee's employment hereunder for Cause (as defined herein)
any time effective upon written notice to Employee. As used herein, the term
"Cause" shall mean:
6.1.1 Habitual neglect in the performance of
Employee's material duties as set forth in Section 2 which continues uncorrected
for a period of thirty (30) days after written notice thereof by Employer to
Employee; or
6.1.2 Material negligence involving misfeasance or
nonfeasance by Employee in the performance of Employee's material duties as set
forth in Section 2 which continues uncorrected for a period of thirty (30) days
after written notice thereof by Employer to Employee; or
6.1.3 A material breach of that certain Employee
NonDisclosure and Invention Assignment Agreement entered into by Employee.
6.1.4 Insubordination or nonfeasance by Employee of
any material services or duties as may be assigned to Employee by the board of
directors, except to the extent that such services or duties would involve a
violation of law or materially expand or conflict with Employee's duties set
forth in Section 2.
6.2 TERMINATION UPON DEATH OR DISABILITY. This Agreement and
Employee's employment hereunder shall terminate upon Employee's death or
Disability (as defined herein). For this purpose, "Disability" means incapacity,
whether by reason of physical or mental illness or disability, which prevents
Employee from substantially performing Employee's material duties as set forth
in Section 2 for six (6) months, or for shorter periods aggregating six (6)
months in any twelve (12) successive calendar months. Upon termination for
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Disability, unless Employer shall have in force a disability insurance policy
providing for benefits in an amount at least equal to the benefits provided in
this Section 6.2, upon termination for Disability, Employer shall continue to
pay the base compensation payments pursuant to Section 3 to the Employee's court
appointed conservator until the date six (6) months following the effective date
of Disability. Upon termination for death, Employer shall continue to pay the
base compensation payments pursuant to Section 3 to the surviving spouse of
Employee (or if there is none to Employee's estate) until the date six (6)
months following the date of death. Termination for death shall become effective
upon the occurrence of such event and termination for Disability shall become
effective upon written notice by Employer to Employee.
6.3 TERMINATION BY EMPLOYEE. Employee at his sole option may
elect to terminate this Agreement if the Company has not received two million
dollars ($2,000,000) in cash equity (purchase of common stock) on or before June
30, 1999. Employee shall give the board of directors of the Company, written
notice to terminate this Agreement by August 31, 1999 and such termination shall
become effective immediately.
6.4 EVENTS UPON TERMINATION. The termination of this Agreement
pursuant to Section 6 shall also result in the termination of all rights and
benefits of Employee under this Agreement except for any rights to compensation
accrued under Section 3 prior to the date of termination or rights to expense
reimbursement under Section 4 and, upon death of Disability as provided in
Section 6.2, the rights provided in Section 6.2 hereof.
7. EMPLOYEE'S REPRESENTATIONS. Employee represents and warrants that
Employee is free to enter into this Agreement and to perform each of the
provisions contained herein. Employee represents and warrants that Employee is
not restricted or prohibited, contractually or otherwise, from entering into and
performing this Agreement, and that Employee's execution and performance of this
Agreement is not a violation or breach of any agreement between Employee and any
other person or entity.
8. INDEMNIFICATION. Employer agrees to forever indemnify and hold
Employee harmless from and against any and all liability, loss, costs, claims or
expenses (including, without limitation, reasonable attorney fees and
disbursements) arising out of or relating to any claim brought by any party
(including, without limitation, any governmental agency) relating to Employee's
employment with Employer, Employee's lawful duties and activities in respect
thereto, or the business of Employer.
9. GENERAL PROVISIONS.
9.1 SEVERABLE PROVISIONS. The provisions of this Agreement are
severable, and if any one or more provisions may be determined to be judicially
unenforceable, in whole or in part, the remaining provisions shall nevertheless
be binding and enforceable.
9.2 ASSIGNMENT. Neither this Agreement nor any of the rights
or obligations of Employee or the Company hereunder shall be assignable.
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9.3 NOTICES. Any notice to be given to Employer under the
terms of this Agreement shall be addressed to Employer at the address of
Employer's principal place of business, and any notice to be given to Employee
shall be addressed to Employee at his home address last shown on the records of
Employer, or at such other address as either party may hereafter designate in
writing to the other. Any notice required or permitted under this Agreement
shall be in writing and shall be deemed effective: (i) upon receipt in the event
of delivery by hand, including delivery made by private delivery or overnight
mail service where either the recipient or delivery agent executes a written
receipt or confirmation of delivery; or (ii) 48 hours after deposited in the
United States mail, registered or certified mail, return receipt requested,
postage prepaid.
9.4 WAIVER. Either party's failure to enforce any provision or
provisions of this Agreement shall not in any way be construed as a waiver of
any such provision or provisions, or prevent that party thereafter from
enforcing each and every other provision of this Agreement.
9.5 ENTIRE AGREEMENT; AMENDMENTS. This Agreement supersedes
any and all other agreements, either oral or in writing, between the parties
hereto with respect to the employment of Employee by Employer and contains all
of the covenants and agreements between the parties with respect to the
employment of Employee by Employer. Each party to this Agreement acknowledges
that no representations, inducements, promises or agreements, orally or
otherwise, have been made by any party, or anyone acting on behalf of any party,
which are not embodied herein, and that no other agreement, statement or promise
not contained in this Agreement will be effective only if it is in writing
signed by the party to be charged.
9.6 TITLES AND HEADINGS. Titles and headings to sections of
this Agreement are for the purpose of reference only and shall in no way limit,
define or otherwise affect the interpretation or construction of such
provisions.
9.7 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
"EMPLOYEE" "EMPLOYER"
DOGWOOD TREE CAPITAL CORP.,
/s/ Xxxxxxx X. Xxxx By: /S/
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Xxxxxxx X. Xxxx
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