SECOND AMENDMENT TO EMPLOYMENT AGREEMENT BETWEEN VOIP INC. AND SHAWN LEWIS
Exhibit
10.4 Xxxxx
Employment Agreement
SECOND
AMENDMENT TO EMPLOYMENT AGREEMENT
BETWEEN
VOIP INC. AND XXXXX XXXXX
The
within is a Second Amendment to the Employment Agreement executed on May 31,
2005 and amended on July 28, 2005 between VOIP
INC.,
a Texas
corporation (the “Company”) and XXXXX
XXXXX
(the
“Executive”).
WHEREAS,
the
Company and the Executive entered into an employment agreement executed on
May
25, 2005 (“Prior Agreement”); and
WHEREAS,
the
Prior Agreement was amended on July 28, 2005 (“First Amendment”);
and
WHEREAS,
the
Company and the Executive desire to amend the Prior Agreement and First
Amendment and reaffirm the Prior Agreements.
NOW,
THEREFORE, IN CONSIDERATION OF THE MUTUAL COVENANTS AND PROMISES AND OTHER
GOOD
AND VALUABLE CONSIDERATION, THE RECEIPT OF WHICH IS HEREBY ACKNOWLEDGED, IT
IS
MUTUALLY AGREED AS FOLLOWS:
1. Amendments
Valid and Subsisting.
The
Company and Executive agree that the Prior Agreement and First Amendment are
valid, subsisting and binding. Annexed hereto and made a part hereof and marked
EXHIBIT I are true copies of the Prior Agreement and First Amendment as
executed.
2. Base
Salary.
The
Company and Executive agree that Executive, effective on September 14, 2006,
Executive will be entitled to a base salary of $250,000 per annum, or $20,833.33
per month.
3. Stock
Compensation.
The
Company and Executive agree that Section 6 of the First Amendment is revised
as
follows:
The
Company, upon execution of the within Amendment, agrees to issue to Executive
10,000,000 stock options (the “Options”) to purchase 10,000,000 shares of Common
Stock, par value $0.001 (the “Common Stock”) of the Company. The Options are
exercisable for a period of five (5) years from the date of issuance at $0.01
per share and are subject to a cashless exercise provision whereby payment
upon
exercise of the Options may be made at the option of the Executive either in
(i) cash, wire transfer or by certified or official bank check payable to
the order of the Company equal to the applicable aggregate exercise price,
(ii)
by delivery of Common Stock issuable upon exercise of the Options in accordance
with Section (a) below (“Cashless Exercise”) or (iii) by a
combination of any of the foregoing methods (in accord with Section (a) below),
for the number of shares of Common Stock specified in such form (as such
exercise number shall be adjusted to reflect any adjustment in the total number
of shares of Common Stock issuable to the Executive per the terms of the
Options) and the Executive shall thereupon be entitled to receive the number
of
duly authorized, validly issued, fully paid and nonassessable shares of Common
Stock determined as provided herein.
(a) If
the Fair Market Value of one share of Common Stock is greater than the exercise
price (at the date of calculation as set forth below) and no Registration
Statement relating to the shares of Common Stock underlying the Options is
in
effect, in lieu of exercising the Options for cash, the Executive may elect
to
receive shares equal to the value (as determined below) of the Option (or the
portion thereof being cancelled) by surrender of the Option at the principal
office of the Company together with the properly endorsed notice of cashless
exercise in which event the Company shall issue to the Executive a number of
shares of Common Stock computed using the following formula:
X=Y
(A-B)
A
1
Where X= the
number of shares of Common Stock to be issued to the Executive
Y= the
number of shares of Common Stock purchasable under the Option or, if only a
portion of the Option is being exercised, the portion of the Option being
exercised (at the date of such calculation)
A= the
Fair Market Value of one share of the Company’s Common Stock (at the date of
such calculation)
B= Exercise
Price (as adjusted to the date of such calculation)
The
Company further agrees to use its best efforts to first include the Options
in
an existing approved option benefits plan and register the underlying shares
in
a Form S-8 Registration statement, or thereafter in the next registration
statement filed by Company.
The
shares underlying the Options as well as all shares of Common Stock in the
Company previously issued to Executive (collectively the “Securities”) will have
cost-free piggy back registration rights and the Securities will be listed
in
the Company’s next Registration Statement.
It
is
further agreed that Executive will be entitled to receive additional options
from time to time during the term of the within Agreement to assure that
Executive has the right to exercise options to maintain beneficial ownership
of
the Company’s Common Stock in the equivalent of a minimum of 8% (eight percent)
of the issued and outstanding shares of Common Stock.
For
the avoidance of doubt regarding the issuance of additional options to Executive
under this Amendment, said additional options will contain the same terms and
conditions as the Options awarded under this Amendment. The Company will issue
any additional Options to Executive pursuant to this provision within ten (10)
days of the end of a fiscal quarter.
4. Term.
The
within Agreement is extended from December 31, 2007 to September 14,
2009.
5. Effect
of Termination of Employment.
The
Company and Executive agree that subsections (c)(iii), (d)(iii), (e)(iii) and
(f)(iii) of Section 4 the Prior Agreement are revised as follows:
“(iii)
a lump sum payment equivalent to the remaining Base Salary (as it was in effect
immediately prior to the Change in Control) due Executive to the end of the
term
of the Agreement or any amendment thereof or six (6) months Base Salary,
whichever is the greater; and”
6. Board
Approval.
The
Company warrants and represents to Executive that the Board of Directors of
the
Company has ratified, adopted and approved the within Agreement, and that the
Company will take the necessary action to file the appropriate Disclosure Report
with the Securities and Exchange Commission.
IN
WITNESS WHEREOF,
the
undersigned have set
their
hands and seals this 14th
day of
September, 2006.
| VOIP INC. | ||
| |
|
|
| By: |
/s/ Xxxxxxx
Xxxxxxx
|
|
|
Witness |
|
/s/ Xxxxx
Xxxxx
|
|
Witness |
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