[EXHIBIT 10.5]
EXECUTIVE EMPLOYMENT AGREEMENT
AGREEMENT made this 16th day of FEBRUARY 2005 by and between Med Gen Inc, a
Nevada corporation (the "Company"), and Xxxx X. Xxxxxxx (the "Executive").
The Company presently employs the Executive as President and Chief Operating
Officer.
The Board of Directors of the Company (the "Board) recognizes that the
executive's contribution to the growth and success of the Company during the
past nine (9) years as the Chairman and Chief Executive Officer of the
Company has been substantial. The Board desires to provide for the
continued employment of the Executive and to make certain changes in the
Executive's employment arrangements with the Company which the Board has
determined will reinforce and encourage the continued attention and
dedication to the Company of the Executive as a member of the Company's
management, as is deemed to be in the best interest of the Company and its
shareholders. The Executive is willing to commit himself to continue to
serve the Company, on the terms and conditions herein provided. In order
to effect the foregoing, the Company and the Executive wish to enter into an
employment agreement on the terms and conditions set forth below.
Accordingly, in consideration of the promises and the respective covenants
and agreements of the parties herein contained, and intending to be legally
bound hereby, the parties hereto agree as follows:
1. Employment.
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The Company hereby agrees to employ the Executive, and the Executive hereby
agrees to continue to serve the Company, on the terms and conditions set
forth herein.
2. Term.
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The Employment of the Executive by the Company as provided in paragraph I
will commence on the date hereof and end after five (5) years on February
16, 2011 unless extended as provided in Section 8 hereof, or, unless sooner
terminated as hereinafter provided. In the event that the Company is sold,
or there is a change in ownership removing the executive from his position as
Chairman and Chief Executive Officer, the remainder of the executives salary
shall become part of the purchase price, and the executive shall receive
full payment in cash (USD) for the remainder of the term of the contract.
Should the contract, for any reason, be terminated by the Board of
Directors the remainder of the contract will, within 10 days of termination,
be paid to the executive in cash (USD).
3. Position and Duties.
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The Executive shall serve as Chairman and Chief Executive Officer of the
Company and shall have such responsibilities and authority as may from time
to time be assigned to the Executive by the Board, during the term of this
Agreement the Executive shall be a member of the Board of Directors. The
Executive shall devote substantially all his working time and efforts to
the business and affairs of the Company.
4. Place of Performance.
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In connection with the Executive's employment by the Company, the Executive
shall be based in Palm Beach or Broward Counties in Florida, except for
required travel on the Company's business to an extent substantially
consistent with present business travel obligations.
5. Compensation and Related Matters.
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(a) Salary. During the period of the Executive's employment hereunder the
Company shall pay to the Executive a salary at a rate of not less than
$150,000 per annum in equal installments as nearly as practicable on a
bi-weekly basis consistent with Company policy, less any salary paid to the
Executive by affiliates of the Company for services rendered to such
affiliates. This salary may be increased from time to time in
accordance with normal business practices of the Company and, if so
increased, shall not thereafter during the term of this Agreement be
decreased. Compensation of the Executive by salary payments shall not
be deemed exclusive and shall not prevent the Executive from participating
in any other compensation or benefit plan of the Company. The salary
payments (including any increased salary payments) hereunder, and no
other compensation, benefit or payment hereunder shall in any way limit
or reduce the obligation of the Company to pay the Executive's salary
hereunder. Should, for any reason, the company not pay the executives
salary, the executive can elect to accrue the unpaid salary, or direct
the company to issue the compensation in the form of stock or stock options.
Should the election be to take stock, the company shall be obligated to
incur all expenses related to that transaction, which shall include transfer
fees, attorney fees and any state or federal tax liabilities.
The adjustment of non-paid income and/or election of method that the
executive chooses to be paid may be, at the executives sole decision be
determined at anytime during the term of the contract. However, the price
of the stock and the number of shares to be issued shall be determined by
the Bid price at the time the election is made.
(b) Expenses. During the term of the Executive's employment hereunder, the
Executive shall be entitled to receive prompt reimbursement for all
reasonable expenses incurred by the Executive in performing services
hereunder, including all expenses of travel and living expenses while away
from home on business or at the request of and in the service of the
Company, provided that such expenses are incurred and accounted for in
accordance with the policies and procedures established by the Company.
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(c) Other Benefits. The Company shall maintain in full force and effect, and
the Executive shall be entitled to continue to participate in all of its
employee benefit plans or arrangements providing the Executive with at least
equivalent benefits thereunder. The Company shall not make any changes in such
plans and arrangements which would adversely affect the executive's rights
or benefits thereunder, unless such change occurs pursuant to a program
applicable to all officers of the Company and does not result in a
proportionately greater reduction in the rights of or benefits to the
Executive as compared with any other officers of the Company. The Executive
shall be entitled to participate in or receive benefits under any employee
benefit plan or arrangement made available by the Company in the future to
its officers and key management employees, subject to and on a basis
consistent with the terms, conditions and overall administration of such
plans and arrangements. Nothing paid to the executive under any plan or
arrangement presently in effect or made available in the future shall be
deemed to be in lieu of the salary payable to the executive pursuant to
paragraph (a) of this Section. Any payments or benefits payable to the
executive hereunder in respect of any calendar year during which the
executive is employed by the Company for less than the entire such year
shall, unless otherwise provided in the applicable plan or arrangement, be
prorated in accordance with the number of days in such calendar year during
which he is so employed.
(d) Stock Options. The Company shall authorize the grant of stock options,
under a Stock Option Plan that has been adopted by the Company, to the
Executive.
(e) Bonus. The Company shall pay Executive an annual bonus in an amount
equal to five percent (5%) of the pre-tax income or net cash-flow, whichever
is greater, of the Company and its subsidiaries on a consolidated basis
(determined in accordance with generally accepted accounting principals,
after all deductions, including depreciation, but not including any federal,
state or local income tax obligations. The Company shall pay such bonus to
Executive within ten (10) days after the date the Company receives its
audited financial statements from its accountants for the fiscal year with
respect to which the bonus is to be paid, or if audited financial statements
are not prepared for such fiscal year, within ninety (90) days of the
expiration of such calendar year. Such Bonus amount shall not be less than
twenty- percent (20%) of the Executive's annual compensation. The executive,
at his sole discretion, can wave, and lower the bonus amount based upon
the company's financial position. Once waved or lowered, the executive
would have no rights to accrue the amounts waved or lowered for future
payment.
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