Exhibit 10.5
INDEPENDENT NON-EXECUTIVE DIRECTOR AGREEMENT
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THIS INDEPENDENT NON-EXECUTIVE DIRECTOR AGREEMENT ("Agreement") is
made, entered into and effective as of June 15th, 2004 (the "Effective Date"),
between HQ Sustainable Maritime Industries Inc. (HQSM or the Company), a
Delaware corporation with its principal place of business located at 00 Xxxx
Xxxxxx xxxxx 0000, Xxx Xxxx, XX 00000 (the "Company"), and Xxxxxxx Xxxxxx ("JV")
an individual residing at 0000 Xxxxx-Xxxxxx Xxxxxxxx, Xxxxxx Xxxxxx regarding
the position of independent director on the board of directors for the Company.
WHEREAS, prior commencing to the Effective Date (the "Inception Date"),
the JV has not been employed by, and has not performed executive services for,
the Company; and
WHEREAS, the board of directors of the Company ("Board"), Company and
the JV wish to memorialize the terms and conditions of the JV's service in the
position of independent director on the board of directors for the Company;
NOW, THEREFORE, in consideration of the covenants and promises
contained herein, the Company and the JV agree as follows:
1. JV. On behalf of the Company, the Board offers to retain the JV, and
the JV agrees to be retained by the Company to provide the service of
independent director on the Board in accordance with the terms and subject to
the conditions of this Agreement, commencing on the Effective Date till the next
meeting of the shareholders of the Company (the "Scheduled Termination Date"),
unless terminated in accordance with the provisions of paragraph 11 hereinbelow,
in which case the provisions of paragraph 11 shall control. The JV affirms that
no obligation exists between the JV and any other entity which would prevent or
impede the JV's immediate and full performance of every obligation of this
Agreement.
2. Position and Duties. During the term of the service with the
Company, the JV shall continue to serve in other non-Company related positions,
and assume duties and responsibilities consistent with, the position of
non-executive independent director. The JV agrees to devote the necessary
working time, skill, energy and best business efforts and exercise his
independent business judgment during the term of his service on the Board of the
Company. Xxxxxxx Xxxxxx fully understands the duty of loyalty, duty of
confidentiality, duty to abide by all relevant securities laws of the United
States and any other jurisdictions in personal and corporate conducts, duty of
due care and good faith performance of his service as an JV and the role of JV
in protecting shareholders' rights and in serving on the audit committee or
other Board committees as necessary.
Notwithstanding anything to the contrary contained herein, the JV may
hold officer and non-executive director positions (or the equivalent position)
in or at other entities that are not affiliated with the Company. The Company
acknowledges that the JV currently holds, and acknowledges the JV's right to
continue to hold, such positions in such entities and to continue to fulfill his
obligations in connection with holding such positions in such entities so long
as it does not interfere with his ability to perform his duties and
responsibilities hereunder.
3. No Conflicts. The JV covenants and agrees that for so long as he is
retained by the Company, he shall govern himself in such a way as to avoid any
conflict with his duties in protecting the company and the interests of the
minority shareholders in the Company.
4. Compensation.
a. Base Remuneration. During the term of this Agreement, the Company
shall pay, and the JV agrees to accept, in consideration for the JV's services
hereunder, pro rata quarterly payments of a total annual cash salary of
US$15,000.00, less all applicable taxes and other appropriate deductions. The
JV's base salary shall be increased annually, on January 1 of each calendar
year, in amount no less than ten percent (10%). In addition, the Board shall
review the JV's base salary annually to determine whether it should be increased
more than ten percent (10%). The decision to increase the JV's base more than
ten percent (10%) and the amount of any such increase shall be within the
Board's sole discretion.
b. Annual Bonus. During the term of this Agreement, the JV shall be
entitled to an annual stock bonus in an amount no less than US$15,000.00 in
shares calculated at the then trading value of the Company at the anniversary of
the present agreement.
5. Expenses. During the term of this Agreement, the JV shall be
entitled to payment or reimbursement of any reasonable expenses paid or incurred
by him in connection with and related to the performance of his duties and
responsibilities hereunder for the Company. All requests by the JV for payment
of reimbursement of such expenses shall be supported by appropriate invoices,
vouchers, receipts or such other supporting documentation in such form and
containing such information as the Company may from time to time require,
evidencing that the JV, in fact, incurred or paid said expenses.
6. Termination of Service.
The Board has the sole discretion to terminate the service of the JV in case of
breach of his duties as an independent director on the Board. In addition,
either the Company as represented by the Board or JV may terminate the present
agreement with an advance notice of at least 60 days, given in writing to the
address hereinabove mentioned, to wit
If to the Company:
HQSM
00 Xxxx Xxxxxx xxxxx 0000
Xxx Xxxx, XX 00000
With a place of business at
0000 Xxxxx-Xxxxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxx X0X 0X0
Tel: (000) 000-0000 (465 FISH)
Fax: (000) 000-0000
If to the JV:
Xxxxxxx Xxxxxx
0000 Xxxxx-Xxxxxx Xxxxxxxx, Xxxxxx Xxxxxx
7. Miscellaneous.
a. Telephones, stationery, postage, e-mail, the internet and other
resources made available to the JV by the Company, are solely for the
furtherance of the Company's business.
b. All issues and disputes concerning, relating to or arising out of
this Agreement and from the JV's employment by the Company, including, without
limitation, the construction and interpretation of this Agreement, shall be
governed by and construed in accordance with the internal laws of the State of
New York, without giving effect to that State's principles of conflicts of law.
All disputes arising hereunder or from shall be subject to the exclusive
jurisdiction of an arbitration penal ("Penal") under the auspices of the
American Arbitration Association in the City of New York. Such Penal shall
compose of three arbitrators with the Company and the JV each selecting one
arbitrator and the third arbitrator to be selected by consensus by the two
arbitrator already selected. Arbitration shall be the only, final and exclusive
remedy to any dispute and the award of the Penal shall be final, exclusive and
binding and enforceable against the parties. Each of the JV and the Company
hereby expressly waives its right to trial and jury trial and hereby submits to
the exclusive jurisdiction of the Penal.
c. The JV and the Company agree that any provision of this Agreement
deemed unenforceable or invalid may be reformed to permit enforcement of the
objectionable provision to the fullest permissible extent. Any provision of this
Agreement deemed unenforceable after modification shall be deemed stricken from
this Agreement, with the remainder of the Agreement being given its full force
and effect.
d. This instrument constitutes the entire Agreement between the parties
regarding its subject matter. When signed by all parties, this Agreement
supersedes and nullifies all prior or contemporaneous conversations,
negotiations, or agreements, oral and written, regarding the subject matter of
this Agreement. In any future construction of this Agreement, this Agreement
should be given its plain meaning. This Agreement may be amended only by a
writing signed by the Company and the JV.
e. This Agreement may be executed in counterparts, a counterpart
transmitted via facsimile, and all executed counterparts, when taken together,
shall constitute sufficient proof of the parties' entry into this Agreement. The
parties agree to execute any further or future documents which may be necessary
to allow the full performance of this Agreement. This Agreement contains
headings for ease of reference. The headings have no independent meaning.
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THE INDEPENDENT NON-EXECUTIVE DIRECTOR STATES THAT HE HAS FREELY AND VOLUNTARILY
ENTERED INTO THIS AGREEMENT AND THAT HE HAS READ AND UNDERSTOOD EACH AND EVERY
PROVISION THEREOF. THIS AGREEMENT IS EFFECTIVE UPON THE EXECUTION OF THIS
AGREEMENT BY BOTH PARTIES.
UNDERSTOOD, AGREED, AND ACCEPTED:
XXXXXXX XXXXXX HQ SUSTAINABLE MARITIME INDUSTRIES, INC.
__________________________ By:_____________________________________
Name:
Title:
Date:_____________________ Date:___________________________________
