Exhibit 10.28
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AMENDMENT TO EMPLOYMENT AGREEMENT
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THIS AMENDMENT (this "Amendment"), dated as of August 4, 2004 (the
"Effective Date"), is entered into between Warp Technology Holdings, Inc., a
Nevada corporation with a place of business at 000 Xxxxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxxxxx 00000 (the "Corporation") and Xxxxxxx Xxxxxx, an individual having
an address at 00 Xxxx Xxxx, Xxxxxx, Xxxxxx, Xxxxxxx (the "Executive"); this
Amendment amends the terms of that certain Employment Agreement (as defined
below).
WHEREAS, that certain Employment Agreement, dated as of August 1, 2003,
entered into between the Corporation and the Executive (the "Employment
Agreement") provides for the Executive to serve the Corporation in the positions
of Chairman, President and Chief Executive Officer;
WHEREAS, under the Employment Agreement the Executive agreed to
undertake other duties and responsibilities consistent with his executive
position, and the Executive has served the Corporation in the position of
Principal Financial Officer;
WHEREAS, the Executive no longer serves the Corporation in the
positions of President and Chief Executive Officer, and, effective upon the
completion of the Transaction (as defined below) Executive resigns as Principal
Financial Officer, as Chairman and as a member of the Board of Directions (the
"Board");
WHEREAS, the Executive will provide independent consulting services to
the Corporation through Elenium Services Limited in connection with certain
matters, for the term hereof;
WHEREAS, the Corporation is entering into a Series B-2 Preferred Stock
Purchase Agreement to be dated of even date herewith, by and among the
Corporation and the Persons listed on Schedule 1.01 thereto (the "Purchase
Agreement"), pursuant to which the Corporation will sell shares of its Series
B-2 Preferred Stock to the Purchasers (as defined in the Purchase Agreement) and
use the proceeds from such sale in furtherance of the Corporation's business
goals (together with all transactions contemplated thereby, the "Transaction");
WHEREAS, one of the conditions to the completion of the Transaction is
that the Corporation and the Purchasers enter into a Stockholders Agreement,
and, under the terms of the Series B-2 Preferred Stock and the Stockholders
Agreement, the Purchasers will have certain rights to elect directors to the
Board and to appoint the Chairman;
WHEREAS, the Executive approves of the Transaction as being in the best
interest of the Corporation and its shareholders, and desires to take the
actions described in this Amendment; and
WHEREAS, the Corporation and the Executive desire to enter into this
Amendment.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Corporation and
the Executive hereby agree as follows:
Amendment of Certain Terms. The parties agree that the representations,
warranties and covenants contained in the Employment Agreement under the section
headings numbered 1 through and including 7 are hereby amended and restated in
their entirety as follows:
1. Termination of Employment; Consulting Services.
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(a) Subject to the terms and conditions set forth in this Agreement,
effective upon the completion of the Transaction, Executive's employment as
Principal Financial Officer of the Corporation shall terminate, and Executive
shall instead provide independent consulting services to the Corporation, in
accordance with the terms and conditions set forth herein to become effective as
of the Effective Date.
(b) The Corporation and Executive hereby agree that as of the Effective
Date, Executive shall participate in the oversight of certain operational
matters of the Corporation's (and/or the Corporation's subsidiaries') business
in the U.K. Such duties shall be performed primarily in the U.K. and subject to
travel outside of such area as may be necessary for Executive to perform his
duties.
(c) Executive shall faithfully and diligently discharge his duties
hereunder and use his best efforts to implement the policies established by the
Board of Directors of the Corporation. Executive agrees to devote such amount of
his time and attention as is reasonably necessary to faithfully and diligently
discharge his duties hereunder.
(d) After the Effective Date, Executive shall be an independent
contractor, and shall not have any of the rights or authority of an employee,
officer, or director of the Corporation; Executive shall have no authority to
bind the Corporation, or to act as an agent or representative of the
Corporation, and Executive shall make no representation or warranty to any third
party to the contrary.
2. Term.
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The term of this Agreement shall commence on the Effective Date and
continue until December 31, 2004, unless earlier terminated pursuant to the
provisions of Section 3 below.
3. Termination.
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(a) This Agreement may be terminated at any time prior to the end of
the term for cause (including without limitation, breach of any material term
hereof) upon written notice to Executive. The date of termination shall be the
date of such notice, or such later date set forth in such notice.
(b) Upon the termination of this Agreement pursuant to this Section 3,
the Executive shall be entitled to the compensation set forth in Section 4(a) of
this Agreement through the date of termination as set forth in Section 3(a).
4. Compensation.
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(a) For the services to be provided hereunder during the period from
the date hereof through September 30, 2004, the Corporation shall issue to the
Executive a Common Stock Purchase Warrant (the "Warrant"), pursuant to which the
Executive will the right to purchase 2,000,000 shares of Common Stock at an
exercise price per share of $0.18. For the services to be provided hereunder
during the period from the date hereof through December 31, 2004, (i) the
Corporation shall issue to the Executive equity compensation in the amount of
88,888 shares of restricted Common Stock of the Corporation, which the
Corporation shall issue on or before November 30, 2004, and (ii) the Corporation
shall cause Executive to receive cash compensation in the amount of Sixteen
Thousand Dollars ($16,000.00) which shall be paid upon receipt of invoice from
Elenium Services dated 31st December 2004.
(b) Other than the compensation described in Section 4(a) above,
Executive acknowledges and agrees that no other compensation is due from the
Corporation under the Employment Agreement or otherwise, and Executive hereby
forever waives and releases any and all claims to the contrary against the
Corporation, Warp Solutions, Ltd. or any other subsidiary or affiliate of the
Corporation or any of
their respective officers, directors, stockholders, employees, agents or
representatives.
(c) To the extent it is able under the restrictions of the federal
securities laws, and subject to a determination by the Board that such would not
cause material harm to the Corporation, the Corporation agrees to provide
Executive at no cost any necessary opinion letter needed by Executive to meet
the resale requirements of Rule 144, or to remove the legend from restricted
stock certificates, under the federal securities laws as applicable to the
restricted Common Stock portion of the Compensation, the Common Stock issuable
upon exercise of the Warrant, or other restricted Common Stock of the
Corporation owned by Executive, once the appropriate holding period for such
restricted common stock has expired.
5. Expenses.
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Executive shall be reimbursed for all reasonable travel and other
expenses incurred by him during the term of this Agreement where such expenses
were incurred in furtherance of his duties to the Corporation under this
Agreement. Notwithstanding the above, any expenditures in excess of $500 must be
pre-approved by the Board to qualify for reimbursement.
6. Indemnification.
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The parties hereto each acknowledge and agree that they have
entered into an Indemnification Agreement of even date with the Employment
Agreement and that such Indemnification Agreement shall remain in full force and
effect throughout the term hereof and shall survive the termination of this
Agreement.
7. Intellectual Property Rights.
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All rights in inventions, designs and intellectual property
(including without limitation patents, copyright, trade xxxx, registered
designs, design rights and know-how) to which Executive may have or may become
entitled by reason of activities in the course of his employment or services as
an independent contractor under the Employment Agreement, this Amendment or
otherwise shall have vested and shall vest automatically in the Corporation and
Executive shall, at the request and expense of the Corporation, provide the
Corporation with all information, drawings and documents requested by the
Corporation and execute such documents and do such things as may be required by
the Corporation to evidence such vesting. The provisions of this Section 7 shall
survive the termination of this Amendment.
Reaffirmation of Certain Terms. The provisions set forth in the Employment
Agreement under the section headings numbered 8 through and including 14 remain
in full force and effect and are hereby reaffirmed.
IN WITNESS WHEREOF, this Agreement has been executed by the Corporation, by its
duly authorized representative, and by Executive, as of the date first above
written.
WARP TECHNOLOGY HOLDINGS, INC.
By: /s/ Xxx Xxxxxxxx
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Name: Xxx Xxxxxxxx
Title: President
/s/ Xxxxxxx Xxxxxx
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XXXXXXX XXXXXX
