EXHIBIT 10.2
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement"), dated January
1, 2003, is made by and between XXXXXX XXXXXX MARKETING,
INC., a Nevada corporation (the "Company"), and X.X. XXXXXXX
("Employee"), with reference to the following:
A. Employee has special skills and abilities and
knowledge of the business of the Company.
B. The Company desires assurance of continued
association and services of Employee in order to retain his
experience, skills, abilities, background, and knowledge and
is, therefore, willing to engage Employee on the terms and
conditions set forth below.
C. Employee desires to be employed by the Company and
is willing to do so on the terms and conditions set forth in
this Agreement.
NOW, THEREFORE, in consideration of the premises and
the mutual covenants and agreements herein contained, the
parties agree as follows:
1. Employment. Subject to the terms and conditions
of this Agreement, the Company hereby employs Employee and
Employee hereby accepts employment with the Company.
2. Term. The term of this Agreement shall be for a
period of one (1) year commencing as of January 1, 2003 (the
"Effective Date"), unless terminated earlier pursuant to
Section 9 herein below. This Agreement shall be renewed
automatically for succeeding terms of one (1) year each
unless terminated pursuant to Section 9 herein below.
3. Duties and Responsibilities. Employee will serve the
Company as its Chief Executive Officer and President.
4. Conflicting Activities. Employee will devote his
full time and attention to the performance of his duties
hereunder and to the promotion of the business of the
Company, but may engage in other business activities so long
as such activities do not interfere with his performance
hereunder.
5. Compensation and Benefits.
(a) Base Salary. As compensation for services
rendered pursuant to this Agreement, the Company will
pay to Employee an initial annual base salary ("Base
Salary") of Forth Thousand Dollars ($40,000), payable
64
in bi-monthly installments (subject to standard federal
and state withholding requirements) commencing as of
the Effective Date. Upon each anniversary date of
this Agreement, the Base Salary may be increased in
such amount as approved by the Board of Directors.
(b) Incentive Bonus. Employee shall be eligible for
an annual incentive bonus in such amount as may be
determined in the absolute discretion of the Company.
(c) Vacation. During the term of this Agreement and
each subsequent twelve-month period, Employee shall be
entitled to four (4) weeks of paid vacation.
(d) Benefits. During the term of this Agreement,
Employee shall be entitled to receive all other
benefits of employment generally available to the
Company's other executive employees.
6. Reimbursement. Subject to the terms of this Section 6,
Employee shall be reimbursed for all authorized "out-of-
pocket" business expenses for business travel and business
entertainment incurred in connection with the performance of
his duties under this Agreement so long as (a) such expenses
constitute business deductions from taxable income for the
Company and are excludable from taxable income to the
Employee under the governing laws and regulations of the
Internal Revenue Code (provided, however, that Employee
shall be entitled to full reimbursement in any case where
the Internal Revenue Service may, under Section 274(n) of
the Internal Revenue Code, disallow to the Company 50% of
meals and entertainment expenses); and (b) such expenses are
consistent with budgets that are approved anytime and from
time to time by the President of the Company. The
reimbursement of Employee's business expenses shall be based
upon valid receipts and other appropriate documentation for
such expenses submitted to the Company.
7. Restrictive Covenants.
(a) Confidential Information. Employee
acknowledges that internal information relating to the
business affairs of the Company, including the
Company's costs of performing services, pricing
formulas, methods and procedures concerning product
procurement, storage and delivery, customer lists,
vendor list, and related information is proprietary and
confidential information ("Confidential Information")
of the Company. Employee agrees that he will not,
during or after the term of this Agreement, disclose
Confidential Information or any portion thereof to any
person, firm, corporation, or other entity for any
reason or purpose whatsoever, nor shall Employee make
use of any such Confidential Information for his own
purposes or for the benefit of any person, firm,
corporation or other entity (except the Company).
65
Employee agrees to hold and protect all Confidential
Information and other internal information concerning
the business and affairs of the Company, in every form
(e.g., writings, memoranda, books, working papers,
letters and electronic data), whether made by him or
otherwise coming into his possession, and upon demand
of the Company deliver the same to the Company together
with all copies thereof.
(b) Customer Information. Employee acknowledges
that the identity and business habits of the customers
of the Company which the Company has acquired or may
acquire, whether or not the same originated through
Employee's efforts, by virtue of the nature of the
Company's business, are the sole and proprietary
property of the Company and constitute valuable trade
secrets. Employee agrees that he will not, either
directly or indirectly, make known or divulge to any
person, firm, corporation or other entity the identity,
addresses or business habits of any past, current or
future customers of the Company.
(c) Solicitation of Employees. Employee
acknowledges that important factors in the Company's
business and operations are the loyalty and goodwill of
its employees and its customers. Accordingly, Employee
agrees that during the term of this Agreement and for a
period of two (2) years following termination of this
Agreement he will not enter into, and will not
participate in, any plan or arrangement to cause any of
the Company's employees to terminate their employment
with the Company.
8. Covenants Not to Compete.
(a) During the Term. During the term of this
Agreement and for two (2) years following termination
of this Agreement, Employee shall not compete, directly
or indirectly, with the Business of the Company, or
interfere with, disrupt or attempt to disrupt the
relationship, contractual or otherwise, between the
Company and any customer, client, supplier, consultant
or other employee of the Company. A competitive
activity shall include, but not be limited to, becoming
an employee, officer, consultant or director of, or
being an investor in, or owner of, an entity or person
engaged in the Business.
(b) Severability. It is the desire and intent
of the parties hereto 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
therefrom the portion thus adjudicated to be invalid or
unenforceable, such deletion to apply only with respect
to the operation of this Section 8 in the particular
jurisdiction in which such adjudication is made.
(c) Survival. Employee's obligations under this
Section 8 shall continue in full force and effect even
if Employee voluntarily leaves his employment with the
Company or is terminated by the Company.
66
9. Termination of Employment.
(a) By Employee. Employee shall have the right to
terminate this Agreement without cause upon notice to
the Company given ninety (90) days prior to the date of
termination.
(b) By Company. The Company shall have the right to
terminate this Agreement and Employee's employment for
Cause ("Cause" being defined herein after). The
President of the Company shall provide Employee written
notice of the reason(s) for termination and Employee
shall be given thirty (30) days in which to remedy the
same. For purposes of this Agreement, "Cause" shall
mean any one or more of the following events or
circumstances:
(i) If the Employee willfully breaches or
habitually neglects his duties and
responsibilities under the terms of this
Agreement.
(ii) The death or Disability of Employee;
"Disability" meaning a condition whereby Employee
is unable to perform his duties and
responsibilities under this Agreement by reason of
any medically determinable physical or mental
impairment which can be expected to result in
death or which has lasted or can be expected to
last for a continuous period of not less than
three (3) months. In the event of Disability,
Employee agrees to submit to examination by any
licensed physician selected by the Company for
purposes of evaluation and to release to the
Company all medical records and reports of such
evaluation in order to confirm any Disability
(iii) If Employee commits a material act of
dishonesty, fraud, misrepresentation or other act
of moral turpitude as would prevent the effective
performance of Employee's duties.
Notwithstanding any provision of this Agreement, if
Employee is terminated for Cause (except in the case of
Disability), or if Employee voluntarily terminates this
Agreement, Company shall only be liable for Base Salary
and other general employee benefits accrued through the
date of termination.
In the case of Disability, Employee shall be entitled
to Base Salary and benefits from and after the Date of
Disability for a period of three (3) months. For
purposes of this Agreement, the "Date of Disability"
shall be the date agreed upon by the Company and
Employee, or in the event that the parties cannot
agree, the date determined by the physician selected by
the Company in accordance with Section 9(a)(ii) herein
above.
10. Obligation Upon Termination of Agreement. Immediately
upon the termination of this Agreement, Employee will remove
his personal property from and vacate the premises of the
Company, and will cease using all of the Company's
documents, data, information, software, computer data,
67
source and access codes, and other Confidential Information
owned by the Company and will return all such documents,
data, information software, computer date, source and access
codes, and other Confidential Information to the Company,
together with all copies thereof. The provisions of this
Section 10 shall be binding during Employee's employment and
at all times thereafter, regardless of the circumstances or
reasons for termination of this Agreement.
11. Dispute Resolution. The parties agree that any
and all disputes, claims or controversies arising out of or
relating to this Agreement that are not resolved by their
mutual agreement shall be submitted to final and binding
arbitration in Xxxxx County, Nevada. The parties will
cooperate with one another in selecting an arbitrator and in
scheduling the arbitration proceedings. The parties
covenant that they will participate in the arbitration in
good faith, and, to the extent not otherwise prohibited by
law, that they will share equally in its costs. The
provisions of this Section 11 may be enforced by any Court
of competent jurisdiction, and the party seeking enforcement
shall be entitled to an award of all costs, fees and
expenses, including attorneys fees, to be paid by the party
against whom enforcement is ordered.
12. Notices. All notices, requests, demands or other
communications (collectively "Notice") required by or
otherwise with respect to this Agreement shall be in writing
and shall be deemed to have been duly given to any party (a)
when delivered personally (by courier service or otherwise),
or (b) on the third Business Day ("Business Day" meaning any
day on which national banking institutions in Las Vegas,
Nevada are open for the transaction of banking business)
after the date sent by a internationally recognized
overnight courier service, in each case to the applicable
addresses set forth below, or to such other address as a
party shall have previously designated by such a Notice:
If to Company: Xxxxxx Xxxxxx Marketing, Inc.
00000 Xxxxx Xxxxx Xx., Xxxx 0
Xxxxxxxx Xxxx, XX 00000
If to Employee: X.X. Xxxxxxx
c/o Xxxxxx Xxxxxx Marketing, Inc.
13. Modifications; Amendments; Waivers. This
Agreement may be modified only by a written instrument duly
executed by each party hereto. Any waiver of any term or
condition of this Agreement shall be effective only if made
in writing and only in the specific instance and for the
purpose of which given.
14. Failure to Object Not a Waiver. The failure of
either party to this Agreement to object to, or to take
affirmative action with respect to, any conduct of the other
which is in violation of the terms of this Agreement, shall
not be construed as a waiver of the violation or breach or
of any future violation, breach or wrongful conduct.
15. Severability. If any one or more of the
provisions of this Agreement shall be held to be invalid,
illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions of this Agreement
shall not be affected thereby.
68
16. Headings. The descriptive headings contained in
this Agreement are for convenience and reference only, do
not form a part of this Agreement and do not in any way
modify, interpret or construe the intentions of the parties
to this Agreement.
17. Choice of Law. This Agreement shall be governed
by and construed in accordance with the substantive laws of
the State of Nevada.
18. Successors and Assigns. No party shall assign
this Agreement or any rights or obligations hereunder (other
than, in the case of the Company, to any person or entity
that merges with or acquires all or substantially all of the
assets of the Company) without the prior written consent of
the other party and any such attempted assignment without
such prior written consent shall be void and of no force and
effect. This Agreement shall inure to the benefit of and
shall be binding upon the successors and permitted assigns
of the parties hereto.
19. Attorneys' Fees. If any action or proceeding is
commenced between the parties hereto with respect to this
Agreement, the prevailing party shall be entitled to all
fees and expenses incurred in connection with such action or
proceeding, including reasonable attorneys' fees.
20. Miscellaneous. This Agreement (a) constitutes
the entire agreement and supersedes and shall prevail over
all other prior agreements and understandings, both written
and oral, between the parties with respect to the subject
matter hereof, and (b) is not intended to confer upon any
other person not a party herein any rights or remedies
hereunder. In the event any claim is made by any party
relating to any conflict, omission or ambiguity in this
Agreement, no presumption or burden of proof or persuasion
shall be implied by virtue of the fact that this Agreement
was prepared by or at the request of a particular party or
its counsel.
21. Counterparts. This Agreement may be executed in
two or more counterparts, each of which counterparts shall
be deemed to be an original, and all such counterparts shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Employment Agreement to be duly executed at Fountain Hills,
Arizona, as of the date first written above.
COMPANY: XXXXXX XXXXXX MARKETING, INC.
a Nevada corporation
By: /s/ X.X. Xxxxxxx
Its: President
EMPLOYEE:
/s/ X.X. Xxxxxxx
69
