Management Agreement of Jason S. Lewis and Capital Resource Funding, Inc. EMPLOYMENT AGREEMENT
Exhibit
10.1
Management
Agreement of
Xxxxx
X. Xxxxx and Capital Resource Funding, Inc.
This
Employment Agreement (this “Agreement”) dated this 3nd
day of
January, 2006, (the "Effective Date"), by and between CAPITAL RESOURCE
FUNDING,
Inc.,
a North
Carolina corporation with offices in Cornelius, North Carolina (the “Company”),
and XXXXX X. XXXXX, a resident of North Carolina (the “Executive”).
W
I T N E S S E T H :
WHEREAS,
the Company is engaged in and seeks to expand its business in the business
plan
consulting industry, and the Executive has substantial experience in managing
and operating businesses and as a senior management executive that would be
very
beneficial to the Company’s operations and future prospects;
WHEREAS,
the Company believes its progress and its prospects for future development
and
growth would be significantly enhanced if the Executive were to serve as the
Company’s Executive Vice President;
WHEREAS,
the Board of Directors of the Company (the “Board”) has authorized this
Agreement with the Executive and has approved its terms and conditions, all
of
which the Board has found to be reasonable, proper, and in the best interest
of
the Company;
WHEREAS,
the Company and the Executive desire to set forth the terms and conditions
pursuant to which the Executive will be employed by the Company;
and
WHEREAS,
the Executive is willing to be employed by the Company pursuant to the terms
and
conditions set forth herein;
NOW
THEREFORE, in consideration of the foregoing premises and of the mutual
covenants and undertakings contained herein, the parties to this agreement
hereby agree as follows:
ARTICLE
I
EMPLOYMENT
DUTIES AND COMPENSATION
1.01
(a)
Initial
Terms of Employment and Duties. The
Company and the Executive hereby agree that for a twelve (12) month period
beginning on the Effective Date, the Company shall employ the Executive as
its
Executive Vice President and the Executive shall perform services for the
Company at the Company’s headquarters location or home office. The last day of
such twelve (12) month period shall be the "Termination Date" for purposes
of
this Agreement.
(b)
Renewal
of Term. Unless
the Company shall have given the Executive written notice at least 180 days
prior to the Termination Date, this Agreement shall renew and continue in effect
for additional one-year periods (and all provisions of this Agreement shall
continue in full force and effect), and each successive anniversary from such
original Termination Date shall thereafter be designated as the “Termination
Date” for all purposes under this Agreement, provided, however, that the Company
may, at its election at any time after the expiration of the initial term of
this Agreement, give the Executive notice of termination, in which event the
Executive shall continue to receive, as severance pay, his base salary, if
any,
and benefits set forth in Paragraphs (d) and (f) below for 12 full months
following such notice of termination. During such 12-month severance period,
the
Board may modify the Executive’s duties as described in Paragraph (c) below
without triggering the provisions of Section 2.03 below. The Company agrees
that
it will not unreasonably withhold any annual renewals of this
Agreement.
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(c)
Duties.
As
an
Executive Vice President of the Company, the Executive shall carry out the
strategic plans and policies as established by the Board of Directors of the
Company and shall report to the Board of Directors. The Executive’s duties shall
include but not be limited to the following:
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(i)
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Supporting
the operations and administration of the Board of Directors by advising
and informing Board members with regard to the operations of the
Company
and interfacing between the Board and the staff of the Company;
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(ii)
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Overseeing
the design, marketing, promotion, delivery, and quality of the Company's
programs, products, and services;
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(iii)
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Recommending
a yearly budget of the new management consulting subsidiary for Board
approval and prudently managing the Company’s resources within those
budgetary guidelines according to current laws and regulations;
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(iv)
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Effectively
managing the human resources of the new subsidiary according to authorized
personnel policies and procedures that fully conform to current laws
and
regulations;
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(v)
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Identifying
and researching potential sources of capital and establishing strategies
to obtain funding from such sources; and
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(vi)
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assuring
that the Company and its mission programs, products, and services
are
consistently presented in strong, positive image to relevant
stakeholders.
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As
an
Executive Vice President of the Company, the Executive shall be entitled to
exercise all rights and power and shall have all the privileges and authorities
commensurate with his offices, including without limitation:
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(i)
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The
full authority for the operations and conduct of the business of
the
Company subject to President’s approval;
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(ii)
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General
decision-making authority with respect to the day-to-day operations
of the
business of the Company, subject to President’s approval;
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(iii)
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The
engagement, retention, and termination of employees and independent
contractors of the Company, the setting of the compensation and other
material terms of employment or engagement of employees and independent
contractors and the establishment of work rules for employees subject
to
President’s approval; and
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(iv)
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The
initiation, development, and implementation of new business, subject
only
to the supervision of the President Board. The Executive shall render
his
services thereunder in the headquarters city (or other headquarters
location approved by the Board) subject to such reasonable travel
as may
be required to perform his duties hereunder. The Executive shall
devote
such time as is required to perform his services
hereunder.
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Compensation
and Expenses. As
soon
as practicable following the execution of this Agreement, the Executive shall
be
issued One Hundred Thousand (100,000) shares of the Company's Preferred Stock,
which is convertible into common stock at the rate of one share of preferred
stock for every ten shares of common stock, for the services rendered pursuant
to this Agreement. Such shares, when converted, shall have piggy-back
registration rights on the next registration statement filed by the Company,
other than registration statements on Form S-8 and S-4. The Executive Vice
President will also earn a seventy (70%) percent commission on all revenues
generated by a new management consulting subsidiary, Waypoint Advisors,
LLC.
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ARTICLE
II
RIGHTS
ON TERMINATION OF EMPLOYMENT
2.01
Right
to Terminate Employment. At
any
time subsequent to the closing of a Qualified Financing, the Executive may,
at
his option, terminate his employment under this Agreement upon not less than
60
days’ written notice to the Board of Directors of the Company given at any time.
In the event of the termination of this Agreement by the Executive, the
Executive shall be entitled to:
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(i)
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exercise
during the 90-day period following the Executive's termination, any
unexercised stock options that are vested as of the date of termination.
Other than the foregoing, the Executive shall be entitled to no further
compensation of any kind after the date of termination.
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2.02
Rights
Upon Termination of Employment Without Cause Prior to the
Termination:
The Company may terminate the Executive’s services without Cause (as defined in
Section 4.20 below) by delivering written notice of such termination to the
Executive. In addition, any:
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(i)
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Material
change of the Executive’s title, responsibilities, or authority by the
Board without the Executive’s concurrence which is not cured within 30
days after notice by the Executive,
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| (ii) |
Material
breach by the Company of this Agreement which continues for 30 days
after
notice by the Executive, or
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| (iii) |
a
change in control of the Company that is required to be reported by
the
Company on Form 8-K,
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shall
be
deemed termination by the Company without Cause. In the event of termination
pursuant to clauses (i), (ii), or (iii) of the preceding sentence, the Executive
shall be entitled to give notice of termination, which notice shall have the
same effect as a notice delivered by the Company.
2.04
Right
Upon Termination of Employment for Cause
The Company shall have the right at any time, by giving written notice to
Executive to terminate Executive’s employment for Cause. Cause shall be deemed
to have occurred if the Executive is convicted of a felony or a crime involving
fraud, gross negligence, or significant mismanagement of the business. Upon
such
termination for Cause, Executive shall be paid his current monthly salary and
any bonuses earned up to that point, and Executive may exercise any unexercised
options or warrants that are vested. Executive shall forfeit all unexercised
options not then vested.
2.05
Beneficiaries
of Payments
If the Executive shall die before receiving all payments to be made by the
Company to him pursuant to any of the provisions of this Agreement, all such
payments or any remaining payments, as the case may be, shall be made by the
Company to such beneficiary or beneficiaries as the Executive may designate
from
time to time by notice in writing filed with the Company, or if the Executive
shall fail or fail effectively to designate a beneficiary, or if no beneficiary
shall survive the date when the last payment is to be made, any remaining
payments shall be made to the Executive’s estate.
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ARTICLE
III
PROTECTIONS/CONFIDENTIALITY
3.01
Covenants
Regarding Protections:
The Executive hereby agrees and covenants to the following:
(a)
Solicitation
of Customers and Registered Primary Vendors:
During
the term of this Agreement and for a period of six months following the
termination of this Agreement by either party (other than a termination of
this
Agreement by the Company’s failure to renew it pursuant to Section 1.01(b)
above), the Executive hereby agrees not to solicit or contact in any manner
that
could be reasonably construed as a solicitation, any past or current customer
or
registered primary vendor of the Company for purposes of encouraging such
customer to refrain from purchasing products or services from the Company or
for
purposes of encouraging such vendor to refrain from providing services or
selling products to the Company. Notwithstanding the above, if the Executive
should leave the Company and join a competitive company, it is recognized by
the
parties that the industry utilizes a variety of marketing and sales techniques
such as direct mail, telemarketing, advertising, etc., and the customer might
be
contacted by the Company that the Executive joins as a matter of course, and
in
this event this practice would not be considered a violation of this
Agreement.
(b)
Solicitation
of Executives:
During
the term of this Agreement and for a period of six months following the
termination of this Agreement by either party (other than a termination of
this
Agreement by the Company’s failure to renew it pursuant to Section 1.01(b)
above), the Executive hereby agrees not to employ, either directly or indirectly
through any entity in which the Executive is an executive officer, and agrees
not to solicit, or contact in any manner that could reasonably be construed
as a
solicitation, any executive officer or director of the Company for purposes
of
encouraging such person to leave or terminate his employment with the
Company.
3.02
Confidentiality;
Competitive or Personal Disparagement:
The Executive and the Company hereby agree that neither will, during the term
of
the Executive’s employment or at any time following the termination hereof for
any reason, do or cause to have done any of the following:
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(i)
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Without
the prior written consent of the other party, use for its own purposes
or
disclosure to any person or other entity any confidential and/or
proprietary information of the Company or the Executive;
and
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(ii)
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Each
party agrees that it will not disparage the other
party.
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3.03
Enforcement:
The Executive and the Company recognize that the provisions of this Agreement
are vitally important to the continuing welfare of the Company and the Executive
and that money damages constitute an inadequate remedy for any violation
thereof. Accordingly, in the event of any such violation by the Executive or
the
Company, the Company or the Executive, in addition to any other remedies it
may
have, shall have the right to institute and maintain a proceeding to compel
specific performance thereof or to issue an injunction restraining any action
by
the Executive or the Company in violation of the Agreement.
ARTICLE
IV
4.01
Indemnifications:
The parties agree that the Executive shall be indemnified by the Company against
any liability asserted against the Executive (and expenses, including without
limitation, reasonable attorney’s fees, court costs, and other legal expenses
incurred in connection therewith) by reason of his position with the Company
or
any subsidiary to the full extent a North Carolina corporation may indemnify
an
officer or director under the North Carolina General Corporate Law.
4.02
No
Obligation to Mitigate Damages:
In the event of a termination of employment upon a change in control, the
Executive shall not be required to mitigate damages by seeking other
employment.
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4.03 Arbitration
and Remedies:
(a) All
disputes, differences, or questions between the parties concerning the
construction, interpretation, and effect of the Agreement, or the rights,
obligations, and liabilities of the parties, and which have as their sole remedy
monetary damages, will be settled by arbitration in the City of Charlotte,
North
Carolina, or such other place as the parties may mutually agree. In the case
of
a dispute, difference, or question, one party shall appoint its arbitrator
and
shall notify the other party in writing (the “Arbitration Notice”) of the
appointment and the matter to be determined. If the party receiving the
arbitration notice fails to appoint an arbitrator and notify the first party
of
such appointment for 15 days after receipt of such notice, the decision of
the
arbitrator appointed by the first of the parties shall be final and binding
on
both of the parties hereto. If two arbitrators are appointed, they shall meet
within 30 days after appointment of the second arbitrator. If they do not agree
as to their decision, they shall choose a third arbitrator, failing which,
third
arbitrator shall be selected in accordance with the rules of the American
Arbitration Association. The arbitration shall be held as promptly as possible
at such time and place in the designated city as the arbitrators may determine.
The decision of the arbitrators so appointed, or a majority of them, will be
final and binding upon the parties hereto. Judgment upon the award may be
entered in any court having jurisdiction, or application may be made to such
court for judicial acceptance of the award and an order to enforce, as the
case
may be. If the arbitrator appointed refuses to act, is incapable of acting,
or
dies, a substitute for him shall be appointed in the manner provided
above.
(b) Each
of
the parties to the Agreement will be entitled to enforce its rights under the
Agreement specifically, to recover damages by reason of any breach of any
provision of this Agreement and to exercise all other rights existing in its
favor. The parties hereto agree and acknowledge that money damages may not
be an
adequate remedy for any breach of the provisions of the Agreement and that
any
party may, in its sole discretion, apply for specific performance and/or
injunctive relief in either a federal or state court to enforce or prevent
any
violations of the provisions of this Agreement.
4.04
Legal
Cost and Indemnification:
The Company shall pay the Executive all legal fees and expenses incurred by
him
as a result of his termination without Cause or Disability, including but not
limited to, all such fees and expenses, if any, incurred in contesting or
disputing any such termination or in seeking to obtain or enforce any right
or
benefit provided in this Agreement through legal process or arbitration, if
the
Executive shall be wholly successful on the merits, such amounts not to exceed
any court-directed maximum.
4.05
Notices:
(a) Any
notice to be given concerning this Agreement shall be given in writing and
either (i) sent by certified or registered mail, return receipt requested,
postage prepaid; or (ii) hand-delivered to the recipient personally. In the
case
of notice sent by mail, the date of the giving of the notice shall be deemed
to
be (i) the date of the postmark of the executed return receipt or (ii) the
date
of actual receipt if not postmarked by the United States Postal Service. In
the
case of notice being hand-delivered, a written dated receipt shall be given
therefor. Hand-delivery of any notice to the Company shall be delivered to
the
Company’s chief financial officer personally.
(b) Notice
shall be sent as follows:
If
to the
Executive: XXXXX
XXXXX
0000
Xxxxx Xxxxxx Xx.
Xxxxxxxxx,
XX 00000
If
to the
Company: CAPITAL
RESOURCE FUNDING, INC.
0000
Xxxxxxx Xxx Xxxxxx
Xxxxxxxxx,
Xxxxx Xxxxxxxx 00000
(c) By
giving
notice to all other parties, any party may, from time to time, designate a
different address to which notice by mail to such party shall be
sent.
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4.06
Successors
and Assigns; Survival in Case of Merger:
(a) This
Agreement is intended to bind and inure to the benefit of, and be enforceable
by, the Executive and the Company and their respective successors and
assigns.
(b) Without
limiting the effect of the foregoing, this Agreement and all of its terms shall
survive, and be enforceable by the Executive, notwithstanding any merger,
consolidation, combination, or reorganization of the Company with or into any
other entity or person (“Surviving Entity”), including but not limited to any
other corporation, partnership, or other similar organization, whether or not
the Company is the Surviving Entity of such merger, consolidation, combination,
or reorganization. The Surviving Entity shall be bound by this Agreement to
the
same extent as if such Surviving Entity had entered into the Agreement with
the
Executive on the Effective Date.
(c) As
a
condition of any merger, consolidation, combination, or reorganization of the
Company as discussed in Section 4.06(b) above, the Company agrees to include,
as
a condition of consummation of such merger, consolidation, combination, or
reorganization, an undertaking by the Surviving Entity, pursuant to which the
Surviving Entity shall agree in writing to be bound by this
Agreement.
4.07
Amendment;
Waiver:
No amendment or other modification of this Agreement nor any waiver of any
term
of this Agreement shall be valid unless it is in writing and signed by the
party
against whom enforcement of the amendment, modification, or waiver is sought.
No
waiver by any party of the breach of any term contained in this Agreement,
whether by conduct or otherwise, in any one or more instances, shall be deemed
to be or construed as a further or continuing waiver of any such breach of
any
other term of this Agreement.
4.08
Further
Assurances:
Each party hereto agrees to perform any further acts and to execute and deliver
any further documents mutually agreed to in writing that may be reasonably
necessary to carry out the provisions of this Agreement.
4.09
Severability:
In the event that any of the provisions, or portions thereof, of this Agreement
are held to be unenforceable or invalid by any court of competent jurisdiction,
the validity and enforceability of the remaining provisions, or portions
thereof, shall not be affected thereby.
4.10
Construction:
Whenever used herein, the singular number shall include the plural, and the
plural number shall include the singular.
4.11
Gender:
Any references hereto to the masculine gender, or to the masculine form of
any
noun, adjective, or possessive, shall be construed to include the feminine
or
neuter gender and form, and vice versa.
4.12
Headings
The headings contained in this Agreement are for purposes of reference only
and
shall not limit or otherwise affect the meaning of any of the provisions
contained hereof.
4.13
Multiple
Counterparts:
This agreement may be executed in multiple counterparts, each of which shall
be
deemed to be an original but all of which together shall constitute one and
the
same instrument.
4.14
Governing
Law:
THIS AGREEMENT HAS BEEN EXECUTED IN AND SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NORTH CAROLINA AND THE OBLIGATIONS OF THE PARTIES HERETO SHALL BE
PERFORMABLE IN CHARLOTTE, NORTH CAROLINA.
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4.15
Inurement:
Subject to the restrictions against transfer or assignment as herein contained,
the provisions of the Agreement shall inure to the benefit of, and shall be
binding on, the assigns, successors in interest, personal representatives,
estates, heirs, and legatees of each of the parties thereto.
4.16
Waiver:
No waiver of any provision or condition of this Agreement shall be valid unless
executed in writing and signed by the party to be bound thereby and then only
to
the extent specified in such waiver. No waiver of any provision or condition
of
this Agreement shall be construed as a waiver of any other provision or
condition of this Agreement and no present waivers of any provision or condition
of this Agreement shall be construed as a future waiver of such provision or
condition.
4.17
Entire
Agreement:
This Agreement contains the entire understanding between the parties hereto
concerning the subject matter contained herein.
IN
WITNESS WHEREOF, the parties to the Agreement have set their respective hands
hereto as of the date first written above.
EXECUTIVE
VICE PRESIDENT
XXXXX
X.
XXXXX
By: /s/ Xxxxx X. Xxxxx
Xxxxx
X.
Xxxxx
THE
COMPANY
Capital
Resource Funding, Inc.
By:
/s/ Xxxxx Xxxxx
Xxxxx Xxxxx
President
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