EMPLOYMENT AGREEMENT
Agreement made this 1st day of October, 1999 by and between TMEX USA, INC.,
a Nevada corporation also authorized to do business in the state of California
(herein "TMEX") and Xxxxxxx X. Xxxxxx residing at 00000 Xxxxx Xxxxxx Xxxxx,
Xxxxxxxxxx, Xxxxxxx (herein "EMPLOYEE" and sometimes referred to as "XXXXXX").
RECITALS
1. Employee has a successful background of management and sales in the
operation of a telephone debit card business, with an established network
distribution system.
2. TMEX is a telecommunications company headquartered in Newport Beach,
California, with a current US-Mexico Laser Communications network and facilities
available for national and international telephone transmission services.
3. TMEX desires to enter into the telephone debit card business
("Venture"), by and through the employment of XXXXXX and the opening of a sales
office in Atlanta, Georgia. XXXXXX desires to be and become an employee of TMEX,
for such purpose.
WITNESSETH
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
promises herein contained, the parties agree as follows:
AGREEMENT
1. Employment. TMEX agrees to employ EMPLOYEE AND EMPLOYEE agrees to serve
TMEX upon the terms and conditions hereinafter set forth.
2. Term of Employment. The employment of EMPLOYEE hereunder shall commence
on October 1, 1999 and shall continue for a period of three years thereafter
with an automatic renewal period of three consecutive years thereafter, unless
sooner terminated pursuant to the provisions of this agreement.
3. Duties of Employee. EMPLOYEE agrees to serve TMEX faithfully in a senior
executive capacity with such title as may be designated by TMEX, to the best of
his ability under direction of the Chief Executive Officer of TMEX or his
successor. It is the intention of the parties that EMPLOYEE shall serve TMEX
specifically in connection with the management and sales operation of a
telephone debit card business by and through a sales office to be established in
Atlanta Georgia, including, but not limited to, such other executive and other
duties, consonant with the management/sales operation of a telephone debit card
business, as TMEX may reasonably require.
4. Compensation. TMEX agrees to pay, or cause to be paid, to EMPLOYEE and
EMPLOYEE agrees to accept, as compensation for the services to be rendered by
EMPLOYEE hereunder, a minimum salary of $5,000 per month for the first two
months of his employment and $10,000 per month, for the next ten consecutive
months and thereafter increased annually by ten percent, all payable in equal
bimonthly installments on the 1st and 15th day of each successive month. TMEX
shall reimburse EMPLOYEE for all reasonable expenses incurred by EMPLOYEE on
behalf of TMEX, including the expense of any business trips undertaken by
Employee at the request of TMEX.
5. Bonus Compensation. In addition to the base salary and compensation
provided in paragraph 4 above, TMEX shall, as signing bonus compensation, issue
50,000 shares of its common stock to EMPLOYEE upon the signing of this agreement
and thereafter contingent bonus compensation of a total of 960,000 shares of its
common stock, over a period of three years in equal quarterly installments of
80,000 shares, provided that EMPLOYEE meets the minimum profit/revenue
projections set forth on the first year cash flow analysis furnished by
Employees, a copy of which is annexed as Exhibit "A" and, thereafter, set forth
in an annual cash flow analysis for each succeeding year mutually agreed to by
the parties. It is expressly understood that the minimum profit/revenue for each
quarterly period shall be determined on a quarterly roll-over basis.
6. Rule 144 Stock. EMPLOYEE agrees and recognizes that all shares of the
common stock of TMEX issued to him under this agreement have not been registered
under Section 5 of the Securities Act of 1933 and are "restricted securities" as
that term is defined in Rule 144 (a) (3) [17 CFR 230.144(a)(3)] and are subject
to the resale limitations which require a holding period of at least one-year
before resale measured from the date they are acquired. For restricted
securities held between one and two years, other provisions of the rule require
that limited amounts may be resold only in ordinary brokerage transactions with
a notice of the resale to be filed with the Securities Exchange Commission.
After a two-year holding period they may be resoled by a non-affiliate without
any restrictions.
7. Employee Insurance. TMEX warrants and represents that its employees are
covered by a PRO health/hospital insurance plan, under which EMPLOYEE will
likewise be covered, effective upon the signing of this agreement. TMEX also
agrees upon the signing and during the life of this agreement to provide and pay
the premium for a $500,000 15-year level payment term life insurance policy
covering EMPLOYEE, who shall be the owner thereof.
8. Commissions. EMPLOYEE shall be entitled to and shall be paid a
commission equal to one and one-half percent on all debit card sales.
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9. Restrictive Covenant of EMPLOYEE. In addition to the provisions of
paragraph 3 hereof, EMPLOYEE agrees during the employment period, to devote all
or such part of his time as reasonably necessary to the Venture and that he will
not engage or be otherwise directly or indirectly interested any way in any
business competing with or of a nature similar to the business of TMEX. EMPLOYEE
further agrees that during the employment period and thereafter without limit
that he will not, except to TMEX communicate, or divulge to any person, firm or
corporation, either directly or indirectly, any information (except that which
is generally known to the public) relating to the business, customers and
suppliers or other affairs of TMEX.
10. TMEX Obligations. In addition to payment of salaries, travel expenses,
health and life insurance, and other items provided above, TMEX shall be
obligated for, including but without limitation, the following:
a) To pay for the lease of office space and necessary office equipment in
Atlanta Georgia:
b) Provide and pay for accounting services, switching lease and switches,
licenses and permits, telephone service, and legal fees; and
c) Provide one time capitalization of the Venture as required by Exhibit A
not to exceed $80,000.
11. Merger, Consolidation of TMEX. In the event that TMEX shall at any time
be merged or consolidated with any other corporation or corporations or shall
sell or otherwise transfer a substantial portion of its assets to another entity
or corporation, the provisions of this Agreement shall bed binding upon and
inure to the benefit of the corporation or entity surviving or resulting from
such merger or consolidation or to which the assets shall be sold or
transferred. Except as provided in the preceding sentence, this Agreement shall
not be assignable by the EMPLOYEE or TMEX.
12. Termination Conditions. TMEX, for the reasons set forth below, shall
have the right to terminate this Agreement by sending written notice of
termination together with two-weeks severance pay to the EMPLOYEE, and thereupon
his employment hereunder shall terminate.
a) In the event the EMPLOYEE shall become incapacitated by reason of mental
or physical disability or otherwise during the term of this agreement, so that
he is prevented from performing his principal duties and services hereunder for
a period of four (4) consecutive months, or the equivalent of six (6)
consecutive months during any 12-month period, TMEX shall have the right to
terminate this Agreement.
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b) In the event the Venture incurs a loss in any month, or months during
the first six months of this Agreement, to the extent that TMEX would of
necessity be required to infuse additional capital into the Venture (new money),
TMEX shall have the right to terminate this Agreement, unless, the additional
capital required does not, in the aggregate, exceed 50% of the profit stemming
from the Venture already realized by TMEX. However, nothing herein contained, is
intended to prevent TMEX from infusing additional capital into the Venture at
anytime, regardless of the source of such capital.
13. Covenant Not To Xxx. The parties expressly agree, (1) that the Venture
covered by the terms of this agreement is a development stage venture; (2) that
the success of the Venture is dependent solely upon the ability of EMPLOYEE to
cause the Venture to fully meet the projections set forth in Exhibit A, absence
Acts of God (or similar occurences, ("Force Xxxxxx") which temporarily prevents
the facilities of TMEX to accomodate the business generated by the Venture and,
(3) that TMEX has agreed to provide the initial capitalization for the Venture
solely in reliance upon such projections provided by EMPLOYEE and has made no
arrangements and is not willing to provide additional capital for the Venture in
the event it occurs losses or otherwise fails to meet the projections absence
Force Xxxxxx. Accordingly, the parties for themselves, their respective heirs,
assigns, legal representatives, assigns and successors covenant with each other
to never collectively or individually institute any suit or action at law or in
equity against the other party arising directly or indirectly out of this
Agreement nor in any way aid in the institution or prosecuting against the other
party of any claim, demand, action or cause of action for damages, arising
directly or indirectly, out of this Agreement.
14. Joint Endeavor. The parties agree that the drafting of this Agreement
was a joint effort on the part of both parties.
15. Notices. All notices, requests, demands and other communications
arising out of this Agreement, if any, shall be delivered personally, by Fax, to
the other party at the address first set forth above. Any party may change such
address by sending written notice of such change by Fax to the other party. All
documents faxed by a party pursuant hereto, including the signature of a party
thereon, if any, shall be deemed an original document for all purposes.
16. Complete Understanding. This Agreement constitutes the complete
understanding between the parties and no statements representation, warranty or
covenant has been made by either party except as expressly set forth herein.
This Agreement shall not be altered, modified, amended or terminated by written
instrument signed by both of the parties hereto.
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IN WITNESS WHEREOF, the parties have executed this agreement the year and
date set forth along side their respective signatures in the space provided
below. The parties agree that if a signed faxed copy of this Agreement is
delivered by one party to the other, it shall be deemed to be an original signed
document, for all purposes.
TMEX USA, INC. EMPLOYEE
By /s/ [ILLEGIBLE] 9-30-99 By /s/ Xxxxxxx X. Xxxxxx
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Its Xxxxxxx X. Xxxxxx
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