Employment Agreement
Exhibit 10.18
This Agreement is effective October 1, 2007 by and between X-Change Corporation, a Delaware
corporation (“the Corporation”) and Xxxx Xxxxxxx, an individual (hereinafter called “Executive”).
Inasmuch as the Corporation is desirous of employing the Executive in the position, and upon
the terms, stated in this Agreement; and, whereas, the Executive is desirous of providing services
to the Corporation as an Executive.
Now, therefore, in consideration of the mutual promises stated in this Agreement and other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
Corporation and the Executive hereby agree as follows:
1. Employment. The Corporation hereby employs the Executive and the Executive hereby accepts
employment at such location as may be reasonably determined by the Corporation.
2. Office, Duties and Term. The Executive shall hold the office and perform the duties for such
office as described on Exhibit A attached to this Agreement. The duties of the Executive may be
changed from time to time by the Corporation. The term of this Agreement shall be three (3) years,
and such employment shall continue uninterrupted until terminated as provided in Section 6 below.
The Executive shall devote the Executive’s entire time, attention, energies and skill to the
business of the Company during the term of this Agreement.
3. Compensation and Benefits. The Corporation shall pay to the Executive, and the Executive
accepts as full compensation for all services to be rendered to the Corporation the compensation
and benefits described in full on Exhibit B attached to this Agreement.
4. Expenses. The Corporation agrees to reimburse the Executive from time to time for all
reasonable business expenses incurred by the Executive in performing the Executive’s duties for the
Corporation under this Agreement in accordance with the Corporation’s policies, provided that the
Executive presents to the Corporation adequate records and other documented evidence required by
the Corporation for reimbursement of such expenses incurred on its behalf.
5. Other Business Activities. During employment, the Executive shall devote his/her work efforts
to the performance of this Agreement and shall not, without the Company’s prior written consent,
render to others services of any kind for compensation, or engage in any other business activity
that would materially interfere with the performance of his/her duties under this Agreement,
provided, however, that the Executive may continue to serve as Director of other corporations, and
to receive compensation for that service from those corporations as listed on Schedule A to this
Agreement, and approved by the Company.
6. Non Competition. During the term of the Executive’s employment and for such longer period as
the Executive may receive employment severance payments, the Executive shall not, directly or
indirectly, as an Executive, Corporation, consultant, advisor, agent, principal, partner, officer,
director or in any other individual or representative capacity, engage or participate in any
business or activity that is competitive in any manner whatsoever with the activities and business
of the Corporation; nor shall the Executive, during the term of the Executive’s employment induce
or attempt to induce any Executive of the Corporation to leave such employ for the purpose of
joining any organization in competition with the Corporation. This Section 6 shall survive
expiration or termination of this Agreement.
Airgate Technologies, Inc.
7. Termination. This Agreement will be terminated by any of the following events:
7.1 Termination upon the Executive’s Death. If the Executive dies during the term of the
employment, the Executive is entitled to (i) compensation then in effect and benefits that accrued
and vested through the date of termination and (ii) a continuance of compensation for a total of
twelve (12) months to one of its surviving parties or to a party (ies) determined by the Executive.
7.2 Termination Upon the Executive’s Disability. If, as a result of incapacity due to
physical or mental illness or injury, the Executive shall have been absent from his/her full time
duties hereunder for four (4) consecutive months, then thirty days after receiving written notice
(which notice may occur before or after the end of such four (4) month period, but which shall not
be effective earlier than the last day of such four (4) month period), the Corporation may
terminate the Executive’s employment hereunder provided the Executive is unable to resume his/her
full time duties at the conclusion of such notice period. Also, the Executive may terminate his
employment hereunder if his health should become impaired to an extent that makes the continued
performance of his duties hereunder hazardous to his physical or mental health or his life;
provided, that the Executive shall have furnished the Corporation with a written statement from a
qualified doctor to such effect and provided, further, that, at the Corporation’s request made
within thirty (30) days of the date of such written statement, the Executive shall submit to an
examination by a doctor selected mutually by the Corporation and the Executive and concurred in the
conclusion of the Executive’s doctor. In the event this agreement is terminated as a result of the
Executive’s disability, the Executive shall (i) receive from the Corporation, in a lump sum payment
due within thirty (30) days of the effective date of termination, the base salary then in effect
for a period of twelve (12) months and (ii) the corporation shall make the insurance and benefits
premium payments for the Executive and any covered dependents for a period of twelve (12) months
after such termination.
7.3 Termination by the Corporation for Good Cause. The Corporation may terminate this
agreement upon a showing of “good Cause” by the Corporation or by a majority vote of the Board of
Directors. “Good Cause” is defined in this agreement as the occurrence of one of the following:
(i) The Executive commits any misfeasance in office (including gross negligence or recklessness) or
any act of dishonesty or fraud against the Corporation; (ii) the Executive commits any unlawful or
criminal act involving moral turpitude; (iii) the Executive willfully breaches this Agreement or
habitually neglects the Executive’s duties to the Corporation. If this agreement is terminated for
Good Cause, as herein enumerated, the Executive shall have no right to any severance compensation,
and shall be entitled only to the compensation and benefits that accrued and vested through the
date of termination.
7.4 Termination by the Corporation Without Good Cause. If the Corporation determines to
terminate this Agreement without Good Cause within the initial three (3) year period, as herein
provided, the Executive shall receive from the Corporation the base salary then in effect for a
period of six (6) months. Further if the Executive is terminated without Good Cause, the
Corporation shall (i) make the insurance and benefits premium payments for a period of six (6)
months after such termination for the Executive and dependents covered by the plans, (ii) vest all
Executive rights in the Corporation’s stock notwithstanding any contrary provisions in the Stock
Option Plan of the Corporation, and (iii) the Executive shall be entitled to receive all other
unpaid benefits due, owing or accrued through his/her last day of employment.
X-Change
Corporation. — Confidential
Page 2 of 6
8. Resignation. The Executive may resign and terminate this Agreement for these reasons:
8.1 Termination by the Executive for Good Reason. The Executive may terminate this agreement with
“Good Reason” by giving thirty (30) days written notice to the Corporation. For purposes of
Section
8, “Good Reason” means any of the following: (i) the Corporation’s material breach of this
agreement, or (ii) the assignment of the Executive without his consent to a position,
responsibilities, or duties of a materially lesser status or degree of responsibility than his
position, responsibilities, or duties at the Effective Date (provided, however, that the parties
hereto agree that a mere change in the title of the Executive shall not constitute “Good Reason” or
(iii) a reduction in the Executive’s base salary by more than 10%, or (iv) a receipt that the
principal workplace will be relocated more than 50 miles. In either case, the Corporation shall
have thirty (30) days to cure such alleged event giving rise to “Good Reason”. In the event the
Executive terminates this agreement for “Good Reason”, the Executive shall receive from the
Corporation the base salary then in effect for a period of nine (9) months. Further, if the
Executive terminates his employment hereunder with “Good Reason”, the Corporation shall (i) make
the insurance and benefits premium payments for a period of nine (9) months after such termination
for the Executive and dependants covered by the plans, (ii) vest all options to purchase the
Corporation’s stock, and (iii) pay all other unpaid expenses and benefits due, owing or accrued
through the Executive’s last day of employment.
8.2 Termination by the Executive Without Good Reason. The Executive may resign or otherwise
terminate this agreement without Good Reason by giving thirty (30) days written notice to the
Corporation. In such event, the Executive shall receive three (3) months severance compensation
and shall be entitled to the compensation and benefits that accrued and vested through the date of
termination.
9. Rights subsequent to a Change of Control. If a “Change of Control” of the Corporation
occurs during the term of this agreement, the Executive shall remain entitled to receive
compensation and benefits as long as the Executive remains employed by the surviving entity. If the
Executive is terminated without Good Cause (“Involuntary Termination”) within ninety (90) days
before, simultaneous with, on or within 18 months after such change of Control, he/she shall be
entitled to the base salary then in effect for a period of twenty four (24) months. In addition,
the Executive’s Insurance and other benefit premium payments will continue for a period of twenty
four (24) months and for any dependants covered by the Executive under any qualifying benefit
plans. Furthermore, In the event of a “Change of Control”, 100% of the unvested balance of the
Executive’s stock options shall vest immediately. For purposes of this agreement, a “Change of
Control” means a merger, consolidation, change of ownership, or reorganization with or involving
any other person, partnership, corporation or business entity such that fifty percent (50%) or more
of the combined voting power of the corporation’s stock has been accumulated by a person,
partnership, corporation or business entity that did not own the Corporation’s majority stock prior
to such transaction or series of related transactions.
10. Indemnification. The Corporation, for the full term of the Executive’s employment, and for a
period thereafter where claims might arise, hereby indemnifies the Executive against any and all
claims against the Executive as an individual from any source relating to the business of the
Corporation. Further, the Corporation agrees that it will maintain a reasonable and adequate
liability insurance policy that conforms to industry norms protecting officers and directors as
individuals from such claims. If such claims arise, the Corporation agrees to advance reasonable
amounts (including estimated legal fees) to the Executive to allow for defending against such
claims.
11. Nonassignability. Neither the Corporation nor the Executive shall have the right to assign
this Agreement or any rights or obligations contained in this Agreement without the written consent
of the other party. Despite the previous, this Agreement shall be binding upon the successors or
assigns of that portion of the business of the Corporation with which or for which the Executive is
employed.
X-Change
Corporation. — Confidential
Page 3 of 6
12. Notices. Any notice required or provided to be given under this Agreement shall be sufficient
if in writing, sent by first class mail, to the Executive’s residence in the case of notice to the
Executive or to
its principal office in the case of the Corporation. Any such notice shall be effective upon
delivery if it is hand delivered; upon receipt if it is transmitted by wire or telegram or upon the
expiration of seventy-two (72) hours after deposit in the United States mail if mailed.
13. Waiver of Breach. The waiver by either party of a breach of any provision of this Agreement by
the other party shall not operate or be construed as a waiver of any subsequent breach by such
other party.
14. Governing Law. This Agreement shall be interpreted and enforced in accordance with the laws of
the State of Texas, and any action brought to enforce any provision of this Agreement or to
commence any other action in connection therewith shall have its venue in Dallas County of State of
Texas.
15. Entire Agreement/Amendment. This agreement supersedes all previous contracts, and constitutes
the entire agreement of whatsoever kind of nature existing between or among the parties respecting
the subject matter hereof, and no party shall be entitled to other benefits than those specified
herein. As between or among the parties, no oral statements or prior written material not
specifically incorporated herein shall be of any force and effect. The parties specifically
acknowledge that, in entering into and executing this agreement each is relying solely upon the
representations and agreements contained in this Agreement and no others. All prior
representations or agreements, whether written or oral, not expressly incorporated herein, are
superseded and no changes in or additions to this Agreement shall be recognized unless and until
made in writing and signed by all parties hereto.
16. Partial Invalidity. If any provision of this Agreement is held by a court of competent
jurisdiction to be invalid, void or unenforceable, the remaining provisions shall nevertheless
continue in full force without being impaired or invalidated in any way.
17. Attorney Fees. If either party employs an attorney to enforce any provision of this Agreement,
the prevailing party shall be entitled to reasonable attorneys’ fees, litigation expenses and costs
and expenses incurred in connection with such enforcement or action.
In witness of this, the parties have executed this Employment Agreement as of the day and year
first above written.
AirGATE Technologies, Inc.
|
Executive | |||||||||
By: Board of Directors
|
By: | |||||||||
| Name: | Xxxx Xxxxxxx | |||||||||
| Chairman and CEO | ||||||||||
Director |
||||||||||
X-Change
Corporation. — Confidential
Page 4 of 6
Exhibit A
Office and Duties
During the term of this Agreement, and unless otherwise changed from time to time by the
mutual written consent of the parties, the Executive shall hold the office and perform the duties
for such office as described below:
| Office: | 000 Xxxxxxx Xxxxxxx Xxxxx, XX 00000 |
Duties of Office:
Chairman of the Board and Chief Executive Officer and other duties as determined by the Board of
Directors.
Other Business Activities
X-Change Corporation. — Confidential
Page 5 of 6
Exhibit B
Compensation and Benefits
1. The Corporation shall pay the Executive the following compensation and benefits during the term
of this Agreement:
2. Salary. The Corporation shall pay the Executive an annual salary of $215,000.00 payable
periodically in accordance with the Corporation’s normal compensation schedules. Notwithstanding
the above, the Executive acknowledges and understands that Company is currently not adequately
financed to continue operations on a regular and customary basis. Accordingly, the Executive agrees
to waive $65,000.00 of the annual base salary until such time as appropriate financing is in place
to finance the companies operations given its stage of development. For purposes of clarification,
any single financing in excess of $1,500,000 shall be deemed appropriate financing for this
purpose, and such waiver shall no longer be required. Further, even when the financing milestone
is reached, Employee agrees to continue to waive $15,000.00 of the annual base until such time as
the Company has achieved revenues of $2,000,000 in any 12 month period. The Executive’s salary
shall be reviewed and adjusted accordingly at any time.
3. Bonus. The Executive may be paid additional compensation, in the form of a bonus, as may be
determined by the Corporation in the Corporation’s sole and absolute discretion, giving weight to
such factors as (1) overall company pre-tax operating profits, (2) revenue objectives (3) funding
initiatives, and (4) progress made by the Executive towards specific goals and objectives.
4. Deductions. The Corporation shall deduct from compensation payable to the Executive such
amounts as is required by law to deduct, including but not limited to federal and state withholding
taxes, social security taxes and state disability insurance, and any other amounts as may be
required pursuant to the Corporation’s benefit programs of which the Executive is a participant.
5. Vacation. The Executive shall be entitled to an annual vacation of four (4) weeks after being
employed for one (1) full year. The Executive shall also be entitled to holidays and illness days
for the days, and at the pay, as is stated in the Corporation’s policies from time to time in
effect.
6. Benefits. The Executive shall also be entitled to participate in all of the Corporation’s
benefit programs of general application to the Executives of X-Change Corporation, including the
following:
Health and Dental Insurance
Disability Insurance
Life Insurance
Stock Option Program, as approved by the Board of Directors
Profit Sharing, as approved by the Board of Directors
401K or similar programs, as approved by the Board of Directors
All other Benefits assigned, as approved by the Board of Directors
Disability Insurance
Life Insurance
Stock Option Program, as approved by the Board of Directors
Profit Sharing, as approved by the Board of Directors
401K or similar programs, as approved by the Board of Directors
All other Benefits assigned, as approved by the Board of Directors
X-Change Corporation. — Confidential
Page 6 of 6
