EMPLOYMENT AGREEMENT
AGREEMENT dated as of January 25, 2002, between GENESIS FUNDING, INC.
("Genesis"), a Washington corporation, having its principal place of business at
000 Xxxxx Xxxxxx Xxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxxxx 00000, and Xxxxxxx X.
Xxxx, an individual residing in Spokane, Washington ("Xxxx").
WITNESSETH:
WHEREAS, Genesis, has executed documents relating to an investment in
GENESIS by Temporary Financial Services, Inc. ("TFS"), Xxxx X. Xxxxxxx, Xxxxxxx
X. Xxxx, and Xxxxxxx X Xxxx (the "Investors").
WHEREAS, Xxxx is acknowledged as a capable and qualified executive in
the financial services business that Genesis will be engaged in;
WHEREAS, the parties acknowledge that Xxxx'x abilities and services are
unique and essential to the prospects of Genesis and the Investors have invested
in Genesis in reliance on Xxxx'x continuing services to Genesis pursuant to this
Agreement; and
WHEREAS, in light of the foregoing, Genesis desires to employ Xxxx as
its President and Xxxx desires to accept such employment.
NOW, THEREFORE, the parties hereto agree as follows:
1. Employment. Genesis hereby employs Xxxx and Xxxx hereby accepts employment
upon the terms and conditions hereinafter set forth.
2. Term. This Agreement shall commence on the date hereof and shall terminate
as of the earlier of:
(a) Two years from the date hereof (the "Initial Term") unless either
Xxxx or Genesis notifies the other that he or it elects to extend
the term hereof for an additional one year (the "Renewal Period"),
such notice to be given within 90 days before the end of the Initial
Term hereof or within 90 days before the end of each successive
Renewal Period;
(b) The death of Xxxx;
(c) Unless cured by Xxxx within the thirty day period, thirty days after
notice is given by Genesis to Xxxx of a material breach hereof by
Xxxx; or
(d) Unless cured by Genesis within the thirty day period, thirty days
after notice is given by Xxxx to Genesis, of a material breach
hereof by Genesis.
The exercise of the right of Genesis or Xxxx to terminate this Agreement
pursuant to clause (c) or (d) hereof, as the case may be, shall not
abrogate the rights and remedies of the terminating party in respect of
the breach giving rise to such termination. Genesis shall only be deemed
to
have materially breached this Agreement and the terms of Xxxx'x employment
if it fails to pay compensation as required under Section 3 or if it
reassigns Xxxx to a position other than senior executive as required
Section 4.
3. Compensation. For all services rendered under this Agreement:
(a) Base Salary. Genesis shall pay Xxxx a base salary of $72,000 per
annum in equal monthly or semi-monthly installments. The Board of
Directors will review, at least annually, Xxxx'x compensation with a
view to increasing it if, in the sole judgment of the Board of
Directors, the earnings of Genesis or the services of Xxxx merit
such an increase.
(b) During the Initial Term, Xxxx shall also receive, at the discretion
of the Board of Directors, incentive compensation in amounts and at
the times set by the Board. Incentive compensation payable under
this subparagraph is intended to reward exemplary performance.
(c) During the term of his employment, Xxxx shall be entitled to
participate in employee benefit plans or programs of Genesis, if
any, to the extent that his position, tenure, salary, age, health
and other qualifications make him eligible to participate, subject
to the rules and regulations applicable thereto. Such additional
benefits shall include, subject to the approval of the Board of
Directors, full medical, three weeks paid vacation, and qualified
pension and profit sharing plans.
(d) Xxxx shall be entitled to reimbursement of all expenses incurred by
him in the performance of his duties, subject to the presenting of
appropriate vouchers in accordance with Genesis's policy.
4. Duties. Xxxx is engaged initially with the title and functions of
President of Genesis and, subject to the direction of the Board of
Directors, shall perform and discharge well and faithfully the duties
which may be assigned to him from time to time by Genesis in connection
with the conduct of its business. Nothing herein shall preclude the Board
of Directors of Genesis from changing Xxxx'x title and duties if the Board
has concluded in its reasonable judgment that such change is in Genesis's
best interests; provided, however, that at all times during the term of
this Agreement, Xxxx shall be employed as a senior Executive of Genesis
with appropriate and commensurate compensation, title, rank and status. If
Xxxx is elected or appointed a director or officer of Genesis or any
subsidiary thereof during the term of this Agreement, Xxxx will serve in
such capacity without further compensation.
5. Extent of Services. Xxxx shall devote his entire time, attention and
energies to the business of Genesis, and shall not, during the term of
this Agreement be engaged in any other business or professional activity,
without the permission of Genesis. Xxxx is specifically prohibited, during
the term of this agreement from providing services to any competitor of
Genesis. This prohibition shall not be construed as preventing Xxxx from
(a) investing his personal assets in businesses which do not compete with
Genesis, (b) purchasing securities in any corporation whose securities are
regularly traded provided that such purchase shall not result in his
collectively owning beneficially at any time five percent or more of the
equity securities of any corporation engaged in a business competitive to
that of Genesis, and (c) participating in
conferences, preparing or publishing papers or books or teaching so long
as the Board of Directors approves of such activities prior to Xxxx'x
engaging in them. Prior to commencing any activity described in clause (c)
above, Xxxx shall inform the Board of Directors of Genesis in writing of
any such activity.
6. Disclosure of Information.
(a) Xxxx represents and warrants to Genesis that his resume included in
the Genesis Funding Business Plan sets forth all material
information about Xxxx'x background. Xxxx further represents that he
is not subject to any covenants not to compete.
(b) Xxxx recognizes and acknowledges that Genesis's trade secrets and
proprietary information and processes, as they may exist from time
to time, are valuable, special and unique assets of Genesis's
business, access to and knowledge of which are essential to the
performance of Xxxx'x duties hereunder. Xxxx will not, during or
after the term of his employment by Genesis, in whole or in part,
disclose such secrets, information or processes to any person, firm,
corporation, association or other entity for any reason or purpose
whatsoever, nor shall Xxxx make use of any such property for his own
purposes or for the benefit of any person, firm, corporation or
other entity (except Genesis) under any circumstances during or
after the term of his employment, provided that after the term of
his employment these restrictions shall not apply to such secrets,
information and processes which are then in the public domain
(provided that Xxxx was not responsible, directly or indirectly, for
such secrets, information or processes entering the public domain
without Genesis's consent). Xxxx agrees to hold as Genesis's
property, all memoranda, books, papers, letters, formulas and other
data, and all copies thereof and therefrom, in any way relating to
Genesis's business and affairs, whether made by him or otherwise
coming into his possession, and on termination of his employment, or
on demand of Genesis, at any time, to deliver the same to Genesis.
7. Inventions. Xxxx hereby sells, transfers and assigns to Genesis or to any
person, or entity designated by Genesis, the entire right, title and
interest of Xxxx in and to all inventions, ideas, disclosures and
improvements, whether patented or unpatented, and copyrightable material,
made or conceived by Xxxx, solely or jointly, or in whole or in part,
during the term of this Agreement which (i) relate to methods, apparatus,
designs, products, processes or devices sold, leased, or used by Genesis
or any subsidiary or (ii) otherwise relate to or pertain to the business,
functions or operations of Genesis or any subsidiary. Xxxx shall
communicate promptly and disclose to Genesis, in such form as Genesis
requests, all information, details and data pertaining to the
aforementioned inventions, ideas, disclosures and improvements; and,
whether during the term hereof or thereafter, Xxxx shall execute and
deliver to Genesis such formal transfers and assignments and such other
papers and documents as may be required of Xxxx to permit Genesis or any
person or entity designated by Genesis to file and prosecute the patent
applications and, as to copyrightable material, to obtain copyright
thereon. Any invention by Xxxx, relating to the business of Genesis,
within one year following the termination of this Agreement shall be
deemed to fall within the provisions of this paragraph unless proved by
Xxxx to have been first conceived and made following such termination.
8. Covenant Not to Compete.
(a) During the term hereof and, unless this Agreement is terminated
pursuant to Section 2(d) hereof, for a period of two years
thereafter, Xxxx shall not compete, directly or indirectly, with
Genesis, interfere with, disrupt or attempt to disrupt the
relationship, contractual or otherwise, between Genesis and any
customer, client, supplier, consultant or employee of Genesis,
including, without limitation, employing or being an investor
(representing more than a 5% equity interest) in, or officer,
director or consultant to, any person or entity which employs any
former key or technical employee whose employment with Genesis was
terminated after the date which is one year prior to the date of
termination of Xxxx'x employment therewith. An activity competitive
with an activity engaged in by Genesis shall include becoming an
employee, officer, consultant or director of, or being an investor
in, or owner of, an entity or person engaged in the business then
engaged in by Genesis.
(b) It is the desire and intent of the parties that the provisions of
this Section 8 shall be enforced to the fullest extent permissible
under the laws and public policies applied in each jurisdiction in
which enforcement is sought. Accordingly, if any particular portion
of this Section 8 shall be adjudicated to be invalid or
unenforceable, this Section 8 shall be deemed amended to delete or
modify the offending portion to the extent required to make this
Section 8 enforceable in the particular jurisdiction in which such
adjudication is made.
(c) Nothing in this Section 8 shall reduce or abrogate Xxxx'x
obligations during the term of this Agreement under Sections 4 and 5
hereof.
9. Remedies.
(a) The parties hereto acknowledge that the damages suffered by Genesis
and the Investors from Xxxx'x breach of this Agreement, by his
continued neglect of his duties in Section 4 or 5, may not be
ascertainable. Accordingly, if Xxxx breaches Section 4 or 5 hereof
by continuously neglecting his duties in either of said Sections,
Genesis and the Investors shall be entitled to the greater of actual
proven damages (determined by a court, or arbitrator) or liquidated
damages from Xxxx in the amount of $18,000.
(b) If there is a breach or threatened breach of the provisions of
Section 5, 6(b), 7 or 8 of this Agreement, Genesis shall be entitled
to an injunction restraining Xxxx from such breach. Nothing herein
shall be construed as prohibiting Genesis from pursuing any other
remedies for such breach or threatened breach.
(c) If this Agreement is terminated pursuant to Section 2(d) hereof,
Xxxx is not required to mitigate damages otherwise obtainable from
Genesis as a result Genesis' breach and any income received by Xxxx
after such termination shall not reduce the amount of damages
otherwise obtainable from Genesis hereunder.
10. Insurance. Genesis may, at its election and for its benefit, insure Xxxx
against accidental loss or death and Xxxx shall submit to such physical
examination and supply such information as may be required in connection
therewith.
11. Assignment. This Agreement may not be assigned by Xxxx. Genesis may assign
this Agreement in connection with a merger or consolidation involving
Genesis or a sale of substantially all its
assets to the surviving corporation or purchaser, as the case may be, so
long as such assignee assumes Genesis's obligations under this Agreement.
12. Notices. Any notice required or permitted to be given under this Agreement
shall be sufficient if in writing and sent by registered mail to Xxxx at
his residence at _______________________
_____________________________________________or Genesis at its address set
forth above, Attention: The Board of Directors.
13. Waiver of Breach. A waiver by Genesis or Xxxx 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 the other party.
14. Entire Agreement. This instrument contains the entire agreement of the
parties. It may be changed only by an agreement in writing signed by a
party against whom enforcement of any waiver, change, modification,
extension or discharge is sought.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first hereinabove written.
Genesis Funding, Inc. Xxxx
___/s/Xxxxxxx X. Durham___________ _/s/ Xxxxxxx X. Kirk____
Name: __Douglas B. Durham________ Xxxxxxx X. Xxxx
Title: ___Chairman________________
