EXHIBIT 10.16
PROFESSIONAL SERVICES, INDEPENDENT CONTRACTOR AGREEMENT
BETWEEN
VALENTEC SYSTEMS, INC.
SOLTAM SYSTEMS, INC.
THIS AGREEMENT is entered into as of the 1st day of MAY, 2001, by and between
Valentec Systems, Inc, having a place of business at ▇▇▇▇ ▇▇▇▇ ▇▇▇., ▇▇▇▇▇▇, ▇▇.
▇▇▇▇▇, (hereinafter referred to as the "COMPANY") and SOLTAM SYSTEMS, INC.,
having a place of business at P. 0. ▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇ ISRAEL, (hereinafter
referred to as the "INDEPENDENT CONTRACTOR").
The parties agree as follows:
1. The term of the AGREEMENT shall be in accordance with the "Duties" as
incorporated. During the Term of the AGREEMENT, the INDEPENDENT CONTRACTOR
shall perform services as defined on the STATEMENT OF WORK which is
incorporated herein and attached hereto and is an integral part of this
AGREEMENT.
2. The COMPANY agrees to pay the INDEPENDENT CONTRACTOR" the rate of
$37,000.00 per month for services performed as described in scope of work
attached as APPENDIX A. All travel shall be at the request of the COMPANY.
3. The INDEPENDENT CONTRACTOR will at all times maintain appropriate
professional credentials, conduct all affairs in accordance with the
highest legal, moral and ethical standards and provide professional
services of a quality acceptable to the COMPANY.
4. For the original payment and thereafter monthly payment of service, the
INDEPENDENT CONTRACTOR shall submit to the COMPANY an invoice for services
performed accompanied by a monthly statement describing in well-defined
detail the work performed. The INDEPENDENT CONTRACTOR'S bills and
statements shall be in a form acceptable to the COMPANY.
5. The compensation set forth in this AGREEMENT shall be the sole
compensation payable to the INDEPENDENT CONTRACTOR by the COMPANY for any
services rendered hereunder.
The INDEPENDENT CONTRACTOR shall be free to exercise discretion and
independent judgement as to the method and means of performance hereunder.
The INDEPENDENT CONTRACTOR acknowledges and agrees that he is not an
employee of the COMPANY and shall not, by virtue of this AGREEMENT or any
other relationship with the Company, be entitled to any benefits or
privileges provided by the COMPANY to its employees.
7. Specifically, the INDEPENDENT CONTRACTOR acknowledges and agrees that he
is not insured under any COMPANY policy of Workers Compensation or any
other insurance. The INDEPENDENT CONTRACTOR agrees that he shall, at his
own expense, acquire whatever employment related insurance coverage that
he may require or is required by any applicable Statute, Law and/or
Regulation or Term of Contract.
8. In view of the confidential relationship contemplated hereunder between
the INDEPENDENT CONTRACTOR and the COMPANY and of the payments to be made
to the INDEPENDENT CONTRACTOR as herein set forth, the INDEPENDENT
CONTRACTOR agrees:
a. The INDEPENDENT CONTRACTOR will not disclose at any time either
during or subsequent to the Term, any proprietary or confidential
information, knowledge or data of the COMPANY which the INDEPENDENT
CONTRACTOR may receive or obtain, including that acquired or
developed by the INDEPENDENT CONTRACTOR, in the performance of the
AGREEMENT unless said disclosure is authorized by Company Executive
Management.
b. All data, and any and all other tangible information or works,
including, but not limited to, any and all written information which
may be or has been furnished to the INDEPENDENT CONTRACTOR and which
may be produced, prepared, or designed by the INDEPENDENT CONTRACTOR
shall remain the exclusive property of the COMPANY. The INDEPENDENT
CONTRACTOR shall not make copies of any such materials except to the
extent required to enable the INDEPENDENT CONTRACTOR to perform
services under this AGREEMENT.
c. In the conduct of work under this AGREEMENT, the INDEPENDENT
CONTRACTOR shall not communicate or otherwise disclose to the
COMPANY confidential or proprietary information, including trade
secrets, of others.
9. The INDEPENDENT CONTRACTOR represents and warrants to the Company that:
a. With respect to any information, knowledge or date disclosed by the
INDEPENDENT CONTRACTOR to the COMPANY in the performance of this
Agreement, the INDEPENDENT CONTRACTOR has the full, unrestricted and
legal right to disclose the same.
b. The INDEPENDENT CONTRACTOR is free to undertake the services
required by this AGREEMENT and there is no conflict of interest
between the INDEPENDENT CONTRACTOR'S performance of the AGREEMENT
and any obligation the Independent Contractor may have to other
parties or clients for whom he has or is currently providing
services.
c. The INDEPENDENT CONTRACTOR will perform all acts consistent with
applicable state and federal laws.
10. This AGREEMENT is intended to secure for the COMPANY the professional
services of the INDEPENDENT CONTRACTOR, and while permitting the
INDEPENDENT CONTRACTOR'S normal performance of professional activities, K
shall operate to preclude the INDEPENDENT CONTRACTOR from accepting
employment or engaging in any activity which, In accordance with normal
standards of professional ethics, may conflict or otherwise Interfere with
the INDEPENDENT CONTRACTOR'S obligations to the COMPANY. If any question
of possible conflict of interest arises, the INDEPENDENT CONTRACTOR will
call the COMPANY'S attention to the situation and confer with the Company
concerning the facts involved.
11. This AGREEMENT shall be governed by and construed in accordance with, the
laws of the State or Louislara.
12. The INDEPENDENT CONTRACTOR will not publish to third parties or otherwise
advertise any affiliation with the COMPANY under this AGREEMENT without
the written consent of the COMPANY.
13. Either party may terminate this AGREEMENT upon thirty (30) days written
notice to the other. In any such event, the COMPANY will pay for any
services rendered and pre-approved travel expenses Incurred through the
termination date, and the INDEPENDENT CONTRACTOR will continue to adhere
to the requirements of paragraph 9 hereof until released by the COMPANY.
In Ine event of a termination, by either party, the COMPANY shall not be
liable to pay for any Independent Contractor services rendered beyond the
termination date.
14. This AGREEMENT AND STATEMENT OF WORK shall constitute the sole AGREEMENTS
between the parties hereto with respect to the subject matter and no
change or amendment to this AGREEMENT shall be binding unless in writing
and signed by both parties. This AGREEMENT will remain in force and effect
untill such time that either party terminates it in writing pursuant to
Paragraph 13.
IN WITNESS WHEREOF, the parties have duly executed this AGREEMENT.
SOLTAM SYSTEMS, INC. VALENTEC SYSTEMS, INC.
BY: [ILLEGIBLE] BY: /s/ ▇▇▇▇▇▇▇ Shows
--------------- ---------------------------
NAME: [ILLEGIBLE] NAME: ▇▇▇▇▇▇▇ Shows
TITLE: CHAIRMAN TITLE: General Mgr, V.P.
DATE: 5-1-01 DATE: May 1, 2001
APPENDIX A
STATEMENT OF WORK
BY SOLTAM SYSTEMS INC.
ON BEHALF OF
VALENTEC SYSTEMS INC.
ACCOUNTING & FINANCE SERVICES:
- Act as financial liaison between VSI and customers
- Act as liaison between VSI and financial institutions worldwide.
- Establish and monitor letters of credit for use as collateral on
contracts if required.
- Establish and monitor lines of credit on VSI's behalf.
- Advise on and assist with preparation of financial, accounting and
budgeting reports.
- Assist with preparation of financial statements formats to assure
compliance with acceptable accounting principles and legal
requirements.
- Participate in the review of the results of the annual audit to
assure compliance with audit standards.
- All other services that enhance communication, coordination,
compliance, and understanding of all financial and accounting
matters.
MARKETING SERVICES:
- Develop marketing strategies to support product initiatives
- Communicate product advances and new technologies to the customer
- Advise on and assist with product research
- Assist in product development as well in designing reporting systems
that support the progress of that development
- Assist in management of contract budgets to maximize return on
investment
- All other services that enhance communication,
coordination, compliance, and understanding of all marketing
matters.
PROGRAM MANAGEMENT SERVICES:
- Plan and implement program services and activities in accordance
with program goals and objectives.
- Oversee program coordination and logistics and monitor compliance
with policies and procedures.
- Assist in determining activities of program staff
- Recommend staffing needs of program
- Make budget recommendations and assist in monitoring approved budget
and expenditures.
- Assist in design and implementation of training programs
- Serve as a resource to staff and others on matters relating to
program policies, procedures and activities.
- Assist and monitor collection and analysis of program data and
participate in evaluating program effectiveness
- Assist in identifying problems and recommend changes to correct the
problems
- Participate in securing funding for the program.
- All other services that enhance communication, coordination,
compliance, and understanding of all program management matters.
EMPLOYMENT AGREEMENT
This Employment Agreement for an Executive (the "Agreement") is made and
effective this 1 July, 2003.
BETWEEN: ▇▇▇▇▇▇▇ ▇. SHOWS, (the Executive") an individual with his main address
at: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
AND: VALENTEC SYSTEMS, INC. (the "Company"), an entity organized and
existing under the laws of the Delaware, with its head office located
at: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
RECITALS
In consideration of the covenants and agreements herein contained and the moneys
to be paid hereunder, the Company hereby employs the Executive and the Executive
hereby agrees to perform services as an Executive of the Company, upon the
following terms and conditions:
1. TERM
The Company hereby employs Executive to serve as Vice President, General
Manager and to serve in such additional or different position or positions
as the Company may determine in its sole discretion. The term of
employment shall continue through December 31, 2006.
The effective date of this Agreement shall be the date first set forth
above, and it shall continue in effect until the earlier of:
A. The effective date of any subsequent employment agreement between
the Company and the Executive;
B. The effective date of any termination of employment as provided
elsewhere herein; or
C. December 31, 2006, provided, that this Employment Agreement shall
automatically renew for successive periods of 1 year each unless
either party gives written notice to other that it does not wish to
automatically renew this Agreement, which written notice must be
received by the other party no less than 60 days and no more than 90
days prior to the expiration of the applicable term.
2. DUTIES AND RESPONSIBILITIES
Executive will be reporting to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Chairman. Within the
limitations established by the By-laws of the Company, the Executive shall
have each and all of the duties and responsibilities of that position.
3. LOCATION
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The initial principal location at which Executive shall perform services
for the Company shall be Valentec offices, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇.
4. ACCEPTANCE OF EMPLOYMENT
Executive accepts employment with the Company upon the terms set forth
above and agrees to devote all Executive's time, energy and ability to the
interests of the Company, and to perform Executive's duties in an
efficient, trustworthy and business-like manner.
5. DEVOTION OF TIME TO EMPLOYMENT
The Executive shall devote the Executive's best efforts and substantially
all of the Executive's working time to performing the duties on behalf of
the Company. The Executive shall provide services during the normal
business hours of the Company as determined by the Company. Reasonable
amounts of time may be allotted to personal or outside business,
charitable and professional activities and shall not constitute a
violation of this Agreement provided such activities do not materially
interfere with the services required to be rendered hereunder.
6. QUALIFICATIONS
The Executive shall, as a condition of this Agreement, satisfy all of the
qualification that are reasonably and in good faith established by the
Chairman.
7. COMPENSATION
7.1 BASE SALARY
Executive shall be paid a base salary ("Base Salary") at the annual rate
of $150,000, payable in biweekly installments consistent with Company's
payroll practices. The annual Base Salary shall be reviewed on or before 1
July of each year, unless Executive's employment hereunder shall have been
terminated earlier pursuant to this Agreement. In consideration of the
services under this Agreement, Executive shall be paid the aggregate of
basic compensation, bonus and benefits as hereinafter set forth.
7.2 PAYMENT
Payment of all compensation to Executive hereunder shall be made in
accordance with the relevant Company policies in effect from time to time,
including normal payroll practices.
7.3 BONUS
From time to time, the Company may pay to Executive a bonus out of net
revenues of the Company. Payment of any bonus compensation shall be at the
sole discretion of the Chairman.
7.4 BENEFITS
The Company shall provide Executive with such benefits as are provided to
other senior management Of the Company. Benefits shall include at a
minimum (i) paid vacation of 4 weeks per year, at such times as approved
by the Chairman, (ii) health insurance coverage under the same terms as
offered to other Executives of the Company, (iii) retirement and profit
sharing programs as offered to other Executives of the Company, (iv) paid
holidays as per the Company's policies, and (v) such other benefits and
perquisites as are approved by the Chairman.
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The Company has the right to modify conditions of participation, terminate
any benefit, or change insurance plans and other providers of such
benefits in its sole discretion. The Executive shall be reimbursed for out
of pocket expenses that are pre-approved by the Company, subject to the
Company's policies and procedures therefore, and only for such items that
are a necessary and integral part of the Executive's job functions.
7.5 WITHHOLDING
All sums payable to Executive under this Agreement will be reduced by all
federal, state, local, and other withholdings and similar taxes and
payments required by applicable law.
8. OTHER EMPLOYMENT BENEFITS
8.1 BUSINESS EXPENSES
Upon submission of itemized expense statements in the manner specified by
the Company, Executive shall be entitled to reimbursement for reasonable
travel and other reasonable business expenses duly incurred by Executive
in the performance of his duties under this Agreement.
8.2 BENEFIT PLANS
Executive shall be entitled to participate in the Company's medical and
dental plans, life and disability insurance plans and retirement plans
pursuant to their terms and conditions. Executive shall be entitled to
participate in any other benefit plan offered by the Company to its
Executives during the term of this Agreement. Nothing in this Agreement
shall preclude the Company or any affiliate of the Company from
terminating or amending any Executive benefit plan or program from time to
time.
8.3 VACATION
Executive shall be entitled to 4 weeks of vacation each year of full
employment, exclusive of legal holidays, as long as the scheduling of
Executive's vacation does not interfere with the Company's normal business
operations.
8.4 AUTOMOBILE
Executive shall be provided or reimbursed for a general purpose automobile
and operating expenses, with approval of Chairman, to be used in
conjunction with performance of company business and for personal use.
9. POLICIES AND PROCEDURES
The Company shall have the authority to establish from time to time the
policies and procedures to be followed by the Executive in performing
services for the Company. Executive shall abide by the provisions of any
contract entered into by the Company under which the Executive provides
services. Executive shall comply with the terms and conditions of any and
all contracts entered by the Company.
10. TERMINATION OF EMPLOYMENT
10.1 FOR CAUSE
Notwithstanding anything herein to the contrary, the Company may terminate
Executive's employment hereunder for cause for any one of the following
reasons: 1) conviction of a felony, any act involving moral turpitude, or
a misdemeanor where imprisonment is imposed, 2) commission of any act of
theft, fraud, dishonesty, or falsification of any employment or Company
records, 3) improper disclosure of the Company's confidential or
proprietary information, 4) any action by the
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Executive which has a detrimental effect on the Company's reputation or
business, 5) Executive's failure or inability to perform any reasonable
assigned duties after written notice from the Company of, and a reasonable
opportunity to cure, such failure or inability, 6) any breach of this
Agreement, which breach is not cured within [10] days following written
notice of such breach, 7) a course of conduct amounting to gross
incompetence, 8) chronic and unexcused absenteeism, 9) unlawful
appropriation of a corporate opportunity, or 10) misconduct in connection
with the performance of any of Executive's duties, including, without
limitation, misappropriation of funds or property of the Company, securing
or attempting to secure personally any profit in connection with any
transaction entered into on behalf of the Company, misrepresentation to
the Company, or any violation of law or regulations on Company premises or
to which the Company is subject. Upon termination of Executive's
employment with the Company for cause, the Company shall be under no
further obligation to Executive, except to pay all accrued but unpaid base
salary and accrued vacation to the date of termination thereof.
10.2 WITHOUT CAUSE
The Company may terminate Executive's employment hereunder at any time
without cause, provided, however, that Executive shall be entitled to
severance pay in the amount of 52 weeks of Base Salary in addition to
accrued but unpaid Base Salary and accrued vacation, less deductions
required by law, but if, and only if, Executive executes a valid and
comprehensive release of any and all claims that the Executive may have
against the Company in a form provided by the Company and Executive
executes such form within 30 days of tender.
10.3 RESIGNATION
Upon termination of employment, Executive shall be deemed to have resigned
from the Board of Directors of the Company if HE is a director.
10.4 COOPERATION
After notice of termination, Executive shall cooperate with the Company,
as reasonably requested by the Company, to effect a transition of
Executive's responsibilities and to ensure that the Company is aware of
all matters being handled by Executive.
10.5 COMPENSATION AFTER NOTICE OF TERMINATION
After notice of termination has been given by either Company or Executive,
as provided in this Article, Executive shall be entitled to receive the
compensation provided for in this Agreement until the notice period has
expired. It is understood that after the written notice is given by either
Company or Executive, Executive shall continue to devote substantially all
of the Executive's time to the Executive's normal services for the Company
during the notice period, with sufficient time allowed, in the sole
discretion of the Company, for Executive to seek new employment.
10.6 CHANGE OF OWNERSHIP
The executive, at his discretion, may choose to terminate his employment
in the event of an ownership change or change in reporting assignment
defined in article 2. In the event of this election, the executive will be
entitled to full compensation for the remainder of the contract term to
include salary, health care, life insurance benefits and vacation
consideration. A new owner or new reporting assignment may not
unilaterally terminate the executive, for any reason, until this agreement
expires or the executive is compensated for the term of the agreement.
11. DISABILITY OF EXECUTIVE
The Company may terminate this Agreement without liability if Executive
shall be permanently prevented from properly performing his essential
duties hereunder with reasonable accommodation by reason of illness or
other physical or mental incapacity for a period of more than [90]
consecutive days. Upon such termination, Executive shall be entitled to
all accrued but unpaid Base Salary and vacation.
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11.1 DEFINITIONS
For purposes of this Agreement, whenever used in this Article 14:
"Total disability" shall mean that the Executive is unable, mentally or
physically, whether it be due to sickness, accident, age or other
infirmity, to engage in any aspect of the Executive's normal duties as set
forth in this Agreement.
"Partial disability" shall mean that the Executive is able to perform, to
some extent, on behalf of the Company, the particular services in which
the Company specializes, and which the Executive previously performed for
the Company, but that the Executive is unable, mentally or physically, to
devote the same amount of time to such services as was devoted prior to
the occurrence of such sickness or accident.
"Normal monthly salary" shall mean the salary which the Executive is being
paid by the Company per month as of the commencement date of the period of
disability, as specified hereinabove or as determined by the Chairman
pursuant to the terms hereof.
11.2 TOTAL DISABILITY
During a single period of total disability of the Executive, the Executive
shall be entitled to receive from the Company, the Executive's normal
monthly salary for the shorter of first three (3) months of disability or
until any disability insurance policy available through the Executive's
employment begins to pay benefits. If the single period of disability
should continue beyond three (3) months, the Executive shall receive only
such amount as the Executive shall be entitled to receive under disability
insurance coverage on the Executive, if any.
11.3 PARTIAL DISABILITY
During a period of partial disability of the Executive, the Executive
shall receive an amount of compensation computed as follows:
That portion of the Executive's normal monthly basic compensation which
bears the same ratio to the Executive's normal monthly basic compensation
as the amount of time which the Executive is able to devote to the usual
performance of services on behalf of the Company during such period bears
to the total time the Executive devoted to performing such services prior
to the commencement date of the single period of disability, and
Such amount shall be calculated by multiplying the Executive's basic
compensation by a fraction, the numerator of which shall be the percentage
of normal services that the Executive is able to perform and the
denominator which shall be the total services that the Executive is able
to perform absent the partial disability.
11.4 COMBINATION OF TOTAL AND PARTIAL DISABILITY
If a single period of disability of the Executive consists of a
combination of total disability and partial disability, the maximum total
disability compensation to which the Executive shall be entitled from the
Company under this disability provision shall not exceed an amount equal
to one (1) times the Executive's normal monthly basic compensation.
11.5 BROKEN PERIODS OF DISABILITY
A period of disability may be continuous or broken. If broken into partial
periods of disability which are separated by intervening periods of work,
there shall be aggregated together all of such successive partial periods
of disability except any period prior to the time when any single period
of work extends for [6] months or longer; and such aggregated periods of
disability shall be treated as a single period in determining the amount
of disability compensation to which an Executive shall be entitled under
any provision of this Section.
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11.6 TERMINATION DUE TO DISABILITY
If and when the period of total or partial disability of the Executive
totals 6 months, the Executive's employment with the Company shall
automatically terminate. Notwithstanding the foregoing, if the disabled
Executive and the Company agree, the disabled Executive may thereafter be
employed by the Company upon such terms as may be mutually agreeable.
11.7 COMMENCEMENT DATE OF DISABILITY
The commencement date of a period of disability, whether it be a
continuous period or the aggregate of successive partial periods, shall be
the first day on which the Executive is disabled.
11.8 DISPUTE REGARDING EXISTENCE OF DISABILITY
Any dispute regarding the existence, extent or continuance of the
disability shall be resolved by the determination of a majority of three
(3) competent physicians, one (1) of whom shall be selected by the
Company, one (1) of whom shall be selected by the Executive and the third
(3rd) of whom shall be selected by the other two (2) physicians so
selected.
11.9 DEATH OF EXECUTIVE
In the event the Executive shall die during the term hereof, the Company
shall pay to the Executive's surviving spouse, or if the Executive shall
leave no surviving spouse, then to the Executive's estate, only such
amounts as may have been earned by the Executive prior to the Executive's
date of death, but which were unpaid at date of death.
12. CONFIDENTIAL INFORMATION AND INVENTION ASSIGNMENTS
Executive recognizes and acknowledges that all records with respect to
clients, business associates, customer or referral lists, contracting
parties and referral sources of the Company, and all personal, financial
and business and proprietary information of the Company, its Executives,
officers, directors and shareholders obtained by the Executive during the
term of this Agreement and not generally known in the public (the
"Confidential Information") are valuable, special and unique and
proprietary assets of the Company's business. The Executive hereby agrees
that during the term of this Agreement and following the termination of
this Agreement, whether the termination shall be voluntary or involuntary,
or with or without cause, or whether the termination is solely due to the
expiration of the term of this Agreement, the Executive will not at any
time, directly or indirectly, disclose any Confidential Information, in
full or in part, in written or other form, to any person, firm, Company,
association or other entity, or utilize the same for any reason or purpose
whatsoever other than for the benefit of and pursuant to authorization
granted by the Company. "Confidential Information" shall also include any
information (including, but not limited to, technical or non-technical
data, a formula, a pattern, a compilation, a program, a device, a method,
a technique, a drawing, a process, financial data, financial plans,
product plans, or a list of actual or potential customers) that: (i)
derives economic value, actual or potential, from not being generally
known to, and not being readily ascertainable by proper means by, other
persons who can obtain economic value from its disclosure or use; and (ii)
is the subject of efforts that are reasonable under the circumstances to
maintain its secrecy. In the case of Company's business, Company's Trade
Secrets include (without limitation) information regarding names and
addresses of any customers, sales personnel, account invoices, training
and educational manuals, administrative manuals, prospective customer
leads, in whatever form, whether or not computer or electronically
accessible "on-line."
13. EXCLUSIVE EMPLOYMENT
During employment with the Company, Executive will not do anything to
compete with the Company's present or contemplated business, nor will he
or she plan or organize any competitive business activity. Executive will
not enter into any agreement which conflicts with his duties or
obligations to the Company. Executive will not during his employment or
within [1] year after it ends, without the Company's express written
consent, directly or indirectly, solicit or encourage any
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Executive, agent, independent contractor, supplier, customer, consultant
or any other person or company to terminate or alter a relationship with
the Company.
14. HIRING
The Executive agrees that during the Executive's employment with the
Company and for a period of [1] years following the termination of this
Agreement, whether the termination shall be voluntary or involuntary, or
with or without cause, or whether the termination is solely due to the
expiration of the term of this Agreement, the Executive will not attempt
to hire any other Executive or independent contractor of the Company or
otherwise encourage or attempt to encourage any other Executive or
independent contractor of the Company to leave the Company's employ.
15. ASSIGNMENT AND TRANSFER
Executive's rights and obligations under this Agreement shall not be
transferable by assignment or otherwise, and any purported assignment,
transfer or delegation thereof shall be void. This Agreement shall inure
to the benefit of, and be binding upon and enforceable by, any purchaser
of substantially all of Company's assets, any corporate successor to
Company or any assignee thereof.
16. NO INCONSISTENT OBLIGATIONS
Executive is aware of no obligations, legal or otherwise, inconsistent
with the terms of this Agreement or with his undertaking employment with
the Company. Executive will not disclose to the Company, or use, or induce
the Company to use, any proprietary information or trade secrets of
others. Executive represents and warrants that he or she has returned all
property and confidential information belonging to all prior employers.
17. ATTORNEYS' FEES
The parties hereto agree that, in the event of breach or threatened breach
of any covenants of Executive, the damage or imminent damage to the value
and the goodwill of the Company's business shall be inestimable, and that
therefore any remedy at law or in damages shall be inadequate.
Accordingly, the parties hereto agree that the Company shall be entitled
to injunctive relief against Executive in the event of any breach or
threatened breach of any of such provisions by Executive, in addition to
any other relief (including damages) available to the Company under this
Agreement or under law. The prevailing party in any action instituted
pursuant to this Agreement shall be entitled to recover from the other
party its reasonable attorneys' fees and other expenses incurred in such
action.
In the event that either party is required to engage the services of legal
counsel to enforce the terms and conditions of this Agreement against the
other party, regardless of whether such action results in litigation, the
prevailing party shall be entitled to reasonable attorneys' fees, costs of
legal assistants, and other costs from the other party, which shall
include any fees or costs incurred at trial or in any appellate
proceeding, and expenses and other costs, including any accounting
expenses incurred.
18. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the
laws of the State of Louisiana regard to conflict of law principles.
19. AMENDMENT
This Agreement may be amended only by a writing signed by Executive and by
a duly authorized
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representative of the Company.
20. SEVERABILITY
If any term, provision, covenant or condition of this Agreement, or the
application thereof to any person, place or circumstance, shall be held to
be invalid, unenforceable or void, the remainder of this Agreement and
such term, provision, covenant or condition as applied to other persons,
places and circumstances shall remain in full force and effect.
21. CONSTRUCTION
The headings and captions of this Agreement are provided for convenience
only and are intended to have no effect in construing or interpreting this
Agreement. The language in all parts of this Agreement shall be in all
cases construed according to its fair meaning and not strictly tor or
against the Company or Executive.
22. RIGHTS CUMULATIVE
The rights and remedies provided by this Agreement are cumulative, and the
exercise of any right or remedy by either party hereto (or by its
successor), whether pursuant to this Agreement, to any other agreement, or
to law, shall not preclude or waive its right to exercise any or all other
rights and remedies.
23. NONWAIVER
No failure or neglect of either party hereto in any instance to exercise
any right, power or privilege hereunder or under law shall constitute a
waiver of any other right, power or privilege or of the same right, power
or privilege in any other instance. All waivers by either party hereto
must be contained in a written instrument signed by the party to be
charged and, in the case of the Company, by an officer of the Company
(other than Executive) or other person duly authorized by the Company.
24. NOTICES
Any and all notices or other communication provided for herein, shall be
given by registered or certified mail, return receipt requested, in case
of the Company to its principal office, and in the case of the Executive
to the Executive's residence address set forth on the first page of this
Agreement or to such other address as may be designated by the Executive.
25. ASSISTANCE IN LITIGATION
Executive shall, during and after termination of employment, upon
reasonable notice, furnish such information and proper assistance to the
Company as may reasonably be required by the Company in connection with
any litigation in which it or any of its subsidiaries or affiliates is, or
may become a party; provided, however, that such assistance following
termination shall be furnished at mutually agreeable times and for
mutually agreeable compensation. Arbitration
Any controversy, claim or dispute arising out of or relating to this
Agreement or the employment relationship, either during the existence of
the employment relationship or afterwards, between the parties hereto,
their assignees, their affiliates, their attorneys, or agents, shall be
settled by arbitration in Shreveport, Louisiana. Such arbitration shall be
conducted in accordance with the then prevailing commercial arbitration
rules of the American Arbitration Association (but the arbitration shall
be in front of an arbitrator, with the following exceptions if in conflict:
(a) one arbitrator shall be chosen by ▇▇▇▇▇▇▇ Shows; (b) each party to the
arbitration will pay its pro rata share of the expenses and fees of the
arbitrator(s), together with other expenses of the arbitration incurred or
approved by
Employment Agreement Page 8 of 11
the arbitrator(s); and (c) arbitration may proceed in the absence of any
party if written notice of the proceedings has been given to such party.
The parties agree to abide by all decisions and awards rendered in such
proceedings. Such decisions and awards rendered by the arbitrator shall be
final and conclusive and may be entered in any court having jurisdiction
thereof as a basis of judgment and of the issuance of execution for its
collection. All such controversies, claims or disputes shall be settled in
this manner in lieu of any action at law or equity; provided however, that
nothing in this subsection shall be construed as precluding the Company
from bringing an action for injunctive relief or other equitable relief or
relief under the Confidential Information and Invention Assignment
Agreement. The arbitrator shall not have the right to award punitive
damages, consequential damages, lost profits or speculative damages to
either party. The parties shall keep confidential the existence of the
claim, controversy or disputes from third parties (other than the
arbitrator), and the determination thereof, unless otherwise required by
law or necessary for the business of the Company. The arbitrator(s) shall
be required to follow applicable law.
IF FOR ANY REASON THIS ARBITRATION CLAUSE BECOMES NOT APPLICABLE, THEN
EACH PARTY, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY AS TO ANY ISSUE RELATING
HERETO IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER MATTER INVOLVING THE PARTIES
HERETO.
26. SOLICITATION
The Executive further agrees that during the term of this Agreement and
following the termination of this Agreement, whether the termination shall
be voluntary or involuntary, or with or without cause, or whether the
termination is solely due to the expiration of the term of this Agreement,
the Executive will not, in any manner or at any time, solicit or encourage
any person, firm, Company or other business entity who are clients,
business associates or referral sources of the Company to cease doing
business with the Company or to do business with the Executive.
27. COVENANTS INDEPENDENT
Each restrictive covenant on the part of the Executive set forth in this
Agreement shall be construed as a covenant independent of any other
covenant or provisions of this Agreement or any other agreement which the
Company and the Executive may have, fully performed and not executory, and
the existence of any claim or cause of action by the Executive against the
Company whether predicated upon another covenant or provision of this
Agreement or otherwise, shall not constitute a defense to the enforcement
by the Company of any other covenant.
28. INJUNCTIVE AND EQUITABLE RELIEF
Executive and Company recognize and expressly agree that the extent of
damages to Company in the event of a breach by Executive of any
restrictive covenant set forth herein would be impossible to ascertain,
that the irreparable harm arising out of any breach shall be irrefutably
presumed, and that the remedy at law for any breach will be inadequate to
compensate the Company. Consequently, the Executive agrees that in the
event of a breach of any such covenant, in addition to any other relief to
which Company may be entitled, Company shall be entitled to enforce the
covenant by injunctive or other equitable relief ordered by a court of
competent jurisdiction.
29. INDEMNIFICATION
The Executive hereby agrees to indemnify and hold the Company and its
officers, directors, shareholders and Executives harmless from and against
any loss, claim, damage or expense, and/or all costs of prosecution or
defense of their rights hereunder, whether in judicial proceedings,
including appellate proceedings, or whether out of court, including
without limiting the generality of
Employment Agreement Page 9 of 11
the foregoing, attorneys' fees, and all costs and expenses of litigation,
arising from or growing out of the Executive's breach or threatened breach
of any covenant contained herein.
30. ACKNOWLEDGMENT
The Executive acknowledges that when this Agreement is concluded, the
Executive will be able to earn a living without violating the foregoing
restrictions and that the Executive's recognition and representation of
this fact is a material inducement to the execution of this Agreement and
to Executive's continued relationship with the Company.
31. SURVIVAL OF COVENANTS
All restrictive covenants contained in this Agreement shall survive the
termination of this Agreement.
32. LIMITATIONS ON AUTHORITY
Without the express written consent from the Company, the Executive shall
have no apparent or implied authority to: (i) Pledge the credit of the
Company or any of its other Executives; (ii) Bind the Company under any
contract, agreement, note, mortgage or otherwise; (iii) Release or
discharge any debt due the Company unless the Company has received the
full amount thereof; or (iv) sell, mortgage, transfer or otherwise dispose
of any assets of the Company.
33. REPRESENTATION AND WARRANTY OF EXECUTIVE
The Executive acknowledges and understands that the Company has extended
employment opportunities to Executive based upon Executive's
representation and warranty that Executive is in good health and able to
perform the work contemplated by this Agreement for the term hereof.
34. INVALID PROVISION; SEVERABILITY
The invalidity or unenforceability of a particular provision of this
Agreement shall not affect the other provisions hereof, and the Agreement
shall be construed in all respects as if such invalid or unenforceable
provisions were omitted.
35. MODIFICATION
No change or modification of this Agreement shall be valid unless the same
be in writing and signed by the parties hereto.
36. ENTIRE AGREEMENT
This Agreement contains the entire agreement and supersedes all prior
agreements and understandings, oral or written, with respect to the
subject matter hereof. This Agreement may be changed only by an agreement
in writing signed by the party against whom any waiver, change, amendment,
modification, or discharge is sought.
37. DISPUTES
Any controversy, claim or dispute arising out of or relating to this
Agreement or the employment relationship, either during the existence of
the employment relationship or afterwards, between the parties hereto,
their assignees, their affiliates, their attorneys, or agents, shall be
litigated solely in state of federal court in Shreveport, LA. Each party
(1) submits to the jurisdiction of such court, (2) waives the defense of
an inconvenient forum, (3) agrees that valid consent to service may be
made by mailing or delivery of such service to the Secretary of State (the
"Agent") or to the party at the party's last known
Employment Agreement Page 10 of 11
address, if personal service delivery can not be easily effected, and (4)
authorizes and directs the Agent to accept such service in the event that
personal service delivery can not easily be effected.
IN WITNESS HEREOF, each party to this Agreement has caused it to be
executed at Minden, Louisiana on the date indicated below.
EXECUTIVE COMPANY
/s/ ▇▇▇▇▇▇▇ ▇. Shows /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------------------- -------------------------
Authorized Signature Authorized Signature
▇▇▇▇▇▇▇ ▇. Shows, Vice President, General Manager ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Chairman
Print Name and Title Print Name and Title
Employment Agreement Page 11 of 11
PROFESSIONAL SERVICES, INDEPENDENT CONTRACTOR AGREEMENT
BETWEEN
VALENTEC SYSTEMS, INC.
AND
▇▇▇▇▇▇ ▇▇▇▇
This Professional Services, Independent Contractor Agreement (the "Agreement")
is entered into as of the 17th day of February 2005, by and between Valentec
Systems, Inc., having a place of business at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(hereinafter referred to as the "Company") and ▇▇▇▇▇▇ ▇▇▇▇, having a address at
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ (hereinafter referred to as
the "Independent Contractor").
The parties agree as follows:
1. The term of Agreement shall be from 17 February 2005 to 17 February
2006, (the "Term"), unless otherwise renewed or terminated as set
forth under paragraph 18. During the Term, including renewal, the
Independent Contractor shall perform services as defined in the
Purchase Order VSI-05-098, which is incorporated herein and attached
hereto as and an integral and material part of this Agreement.
Independent Contractor as Maintenance Technician shall report, to
the Pyrotechnic Manufacturing Manager.
2. The Parties agree that, in their mutual discretion, they may choose
to terminate this Agreement and enter into an Employment Agreement
which option shall remain open and obtainable.
3. The Company agrees to pay the Independent Contractor an hourly fee
of $20.00 per hour, which payment shall be made to the Independent
Contractor, on a bi-weekly basis following the period of performance
after presentation of proper invoice.
4. Without limiting any other provision of this Agreement the
Independent Contractor shall at all times during its engagement
hereunder:
a. Act honestly and diligently in all transactions relating
to the Company:
b. Give to the Company true accounts of those transactions
and also upon every reasonable request furnish a full
and correct explanation of them to the Company.
c. Divulge to the Company all information or knowledge
which the Independent Contractor may possess in relation
to the Company;
d. Use its best endeavors to promote the interest and
welfare of the Company;
e. Not at any time intentionally do anything which directly
or indirectly may impair or be likely to impair the good
name and reputation of the Company or its business; and
1
f. At all times maintain appropriate professional
credentials, conduct all affairs in accordance with the
highest legal, moral and ethical standards and provide
professional services of a quality acceptable to the
Company.
5. For each bi-weekly payment of service, the Independent Contractor
shall submit to the Company an invoice for services performed
accompanied by a monthly statement describing, in well-defined
detail, the work performed. The Independent Contractor's ▇▇▇▇ and
statements shall be in a form acceptable to the Company.
6. The compensation set forth in this Agreement shall be the sole
compensation payable to the Independent Contractor by the Company
for any services rendered hereunder.
7. The independent Contractor shall be free to exercise discretion and
independent judgment as to the method and means of performance
hereunder, provided that it is within the scope of the applicable
Purchase Order. The Independent Contractor acknowledges and agrees
that he is not an employee, agent, officer or representative of the
Company and shall not, by virtue of this Agreement or any other
relationship with the Company, be entitled to any benefits or
privileges provided by the Company to its employees.
8. Specifically, the Independent Contractor acknowledges and agrees
that he is not insured under any Company policy of Workers
Compensation or any other insurance Company benefit plan. The
Independent Contractor agrees that they shall, at his or her own
expense, acquire whatever employment related insurance coverage's
that he or she may require or are required by any applicable
statute, law and/or regulation for the Term and any renewal. Neither
Federal, nor state, or local income tax, nor payroll tax of any kind
shall be withheld or paid by Company on behalf of Independent
Contractor.
9. In view of the confidential relationship contemplated hereunder
between the Independent Contractor and the Company and of the
payment to be made to the Independent Contractor as herein set
forth, the Independent Contractor agrees:
a. The Independent Contractor will not disclose at any time
either during or subsequent to the Term or any renewal,
any proprietary or confidential information, knowledge
or data of the Company which the Independent Contractor
may receive or obtain, including that acquired or
developed by Independent Contractor, in the performance
of the Agreement unless said disclosure is authorized in
writing by the Company's President and Chief Executive
Officer.
b. All data, and any and all other tangible information or
works, including, but not limited to, any and all
written information, inventions, know-how, discoveries,
processes, trade secrets or other proprietary
information which may be or has been furnished to the
Independent Contractor and/or which may be produced,
prepared, or designed by the Independent Contractor as a
result of his performance under this Agreement (either
jointly or with others) shall remain the
2
exclusive property of the Company. The Independent
Contractor shall not make copies of any such materials
except to the extent required to enable the Independent
Contractor to perform services under this Agreement.
10. The Independent Contractor represents and warrants to the Company
that:
a. With respect to any information, knowledge or data
disclosed by the Independent Contractor to the Company
in the performance of this Agreement, the Independent
Contractor has the full, unrestricted and legal right to
disclose the same.
b. The Independent Contractor is free to undertake the
services required by this Agreement and there is no
conflict of interest between the Independent
Contractor's Performance of the Agreement and any
obligation the Independent Contractor may have to other
parties or clients for whom he or she has or is
currently providing services.
c. The Independent Contractor will perform all acts
consistent with applicable state and federal laws
d. In the conduct of work under this Agreement, the
Independent Contractor shall not communicate or
otherwise disclose to the Company confidential or
proprietary information, including trade secrets, of
others.
11. Nothing contained herein shall constitute a partnership or joint
venture, nor make Independent Contractor the agent or representative
of the Company. Independent Contractor shall not have the authority
to bind either the Company or incur any liabilities on behalf of the
Company, [or to direct the employees of the Company.]
12. This Agreement is intended to secure for the Company the
professional services of the Independent Contractor, and while
permitting the Independent Contractor's normal performance of
Professional activities, it shall operate to preclude Independent
Contractor from accepting employment or engaging in any activity
which, in accordance with normal standards of professional ethics,
may conflict or otherwise interfere with the Independent
Contractor's obligations to the Company. If any question of possible
conflict of interest arises, the Independent Contractor will call
the Company's attention to the situation and confer with the Company
concerning the facts involved.
13. Commencing with the execution of this Agreement and throughout the
Term and/or any renewal of this Agreement and for the period of one
(1) year following the termination of this Agreement, Independent
Contractor shall not, without the prior written consent of the
Company, directly or indirectly, either alone, in conjunction with
or through the use of others, whether as principal, agent, employee,
trustee or through the agency of any person or entity, hire,
contract with, attempt to influence, solicit or otherwise offer
employment or any other business opportunity or relationship to any
Company employees or other independent contractors which would
result in or encourage such
3
employees or independent contractors to withdraw, curtail or
terminate such person's business relationship with the Company. Both
parties recognize the difficulty and uncertainty of demonstrating
the amount of damages that would result in the event of a breach of
this provision. Therefore both parties agree that an equitable
measure of such damage is the greater of(l) the most recent monthly
gross billing rate at which any such person is billed to a client,
or (2) the most recent monthly rate of salary or other compensation
paid to such person. Therefore, in the event of a breach of this
provision, Independent Contractor shall pay to the Company as
liquidated damages and not as a penalty the amount resulting from
the greater of (1) or (2) hereinabove times twelve.
14. a. Independent Contractor covenants and agrees that during
Independent Contractor's engagement and for the period of one (1)
year following termination of this Agreement, the Independent
Contractor ~ not, directly or indirectly, perform any service
involving the Customers of the Company for any Customer of the
Company (as hereafter defined), regardless of said Customer's
location, if the services or products to be provided to said
Customer (directly or indirectly) are similar to the services and
products which are or were offered or provided by the Company during
the Term of this Agreement to said Customer, and if the Independent
Contractor had established direct or indirect contact or had direct
or indirect communications with such Customer while fu the service
of the Company.
b. The term "Customer" as used in this Agreement shall mean any
person, government agency, firm, company, partnership, corporation,
proprietorship, association or other business entity that was
identified in the Company's customer lists or otherwise made known
to the Independent Contractor by virtue of the Independent
Contractor's engagement with the Company and with which the Company
had any communication, verbal or written, connected to the
prospective purchase of products or services from the Company,
specifically including without limitation communications concerning
bids, proposals, quotations and/or any negotiations related thereto.
c. THE INDEPENDENT CONTRACTOR ACKNOWLEDGES THAT THE PROVISIONS
CONTAINED IN THIS AGREEMENT ARE (i) NECESSARY FOR THE PROTECTION OF
THE COMPANY'S BUSINESS, (ii) WILL NOT UNDULY RESTRICT THEIR ABILITY
TO EARN A LIVELIHOOD AND (iii) ARE REASONABLE IN THEIR SCOPE.
15. Independent Contractor shall indemnify and hold harmless the Company
and any of its employees, officers, directors, agents or
representatives from any and all claims, damages, costs, expenses,
or liabilities that result from, or are in any way associated or
connected with, any direct or indirect acts or omissions by the
Independent Contractor or any person working for him or at his
request while performing under this Agreement.
16. This Agreement shall be governed by, and construed in accordance
with, the laws of Delaware.
4
17. The Independent Contractor will not publish to third parties or
otherwise advertise any affiliation with the Company under this
Agreement without the written consent of the Company, either during
the Term, any renewal or after termination of this Agreement.
18. Independent Contractor represents and warrants that it has full
right, power and authority to enter into this Agreement and that it
is not subject to any consulting agreement, employment contract or
similar arrangement which would restrict its ability to enter into
this Agreement or perform the services required to be performed
hereunder.
19. Either party may terminate this Agreement after giving sixty (60)
days prior written notice to the other of its intent to terminate
without cause. The parties shall deal with each other in good faith
during the sixty (60) day period after any notice of intent to
terminate has been given.
20. This Agreement and Purchase Order attached hereto and all other
Purchase Orders subsequently entered into during the Term or any
renewal shall constitute the sole agreement between the parties
hereto with respect to the subject matter and no change or amendment
to this Agreement shall be binding unless in writing and signed by
both parties. This Agreement will remain in force and effect until
such time that either party terminates it in writing pursuant to
paragraph 18.
21. No waiver, amendment or modification of any provision of this
Agreement shall be effective unless in writing and signed by both
parties. The failure of any party to insist in anyone or more
instances on strict performance of any of the terms and conditions
of this Agreement, or the failure to exercise any right or privilege
contained in this Agreement or the waiver of any breach of the terms
and conditions of this Agreement, shall not be considered as
thereafter waiving any such terms, conditions, rights or privileges,
and the same shall continue and remain in full force and effect as
if no waiver has occurred.
22. The terms of paragraphs 12,13,14,15,16 and 17 shall survive any
termination of this Agreement.
23. Any previous agreements or understandings between the parties
regarding the subject matter hereof are merged into and superseded
by this Agreement. All representations, warranties, covenants, terms
and conditions of this Agreement shall be binding upon and inure to
the benefit of and be enforceable by the respective legal
representatives, successors and assigns of the parties hereto.
Nothing herein express or implied is intended or shall be construed
to confer upon or to give any person, other than to Buyer and
Seller, any rights or remedies under or by reason of this Agreement.
24. The parties have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of
intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties and no presumption or burden of
proof shall arise favoring or disfavoring any party by virtue of the
authorship of any of the provisions of this Agreement.
5
25. This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original but all of which together will
constitute one and the same instrument
REMAINDER OF PAGE LEFT INTENTIONALLY BLANK
6
February 17, 2005
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered as of the date and year first set forth above
INDEPENDENT CONTRACTOR VALENTEC SYSTEMS, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. Shows
----------------- --------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇ Name: ▇▇▇▇▇▇▇ ▇. Shows
Title: Vice President, General Manager
7
CONSULTING AGREEMENT
This Consulting agreement (hereinafter "Agreement") is entered into between the
parties, ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, located at 6149D ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇,▇▇▇▇▇▇,▇▇
▇▇▇▇▇ (hereinafter "PAPIRI"), and Valentec Systems, Inc., located at ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (hereinafter "VALENTEC"), (PAPIRI and VALENTEC
hereinafter collectively "The Parties") in respect to Introductions (defined
below) made by PAPIRI to VALENTEC, directly or through one or more
intermediaries for the purpose of VALENTEC entering into a transaction resulting
in VALENTEC becoming an SEC registered publicly traded company (hereinafter
"Company"). This Agreement shall govern for all introductions PAPIRI shall make
to VALENTEC, including but not limited to ▇▇. ▇▇▇▇▇▇▇▇, for the term of this
Agreement.
The term "Investor(s)" shall mean any; person, or anything naturally,
financially or legally defined as such, or any corporation, partnership,
company, fund, trust, foundation, group, business structure, assortment or
arrangement of people or any combination, grouping or derivative of those
described herein, introduced by PAPIRI to VALENTEC.
The term "Transaction" or the term "Financing" shall mean any; investment
(including but not limited to: cash, equity or debt), loan, venture,
partnership, merger, financing, recapitalization, acquisition, spinoff,
arrangement, combination, or other form pursuant to which VALENTEC, is financed,
acquires, is acquired, or any other business combination or transaction between
VALENTEC and a Company. Or any gross proceeds of financing that addresses
VALENTEC's capital requirements or other payments in connection with any
business relationship entered into by VALENTEC introduced by PAPIRI.
The term "Introduction" shall mean providing a new significant and meaningful
contact not available to VALENTEC during its normal course of business or not
accessible by VALENTEC through its own Due Diligence and Investigation.
Introductions will not be made by PAPIRI unless requested in writing by
VALENTEC. Any other such introduction shall be considered un-requested,
available under the normal course of VALENTEC's business and not within the
scope of this agreement.
On any Introduction that results in VALENTEC becoming an SEC registered public
company, VALENTEC shall pay PAPIRI a two part consulting fee of twenty thousand
dollars ($20,000) U.S. currency; and shares of common stock equal to one percent
(1%) of the resulting entity post merger. This consulting fee shall be in
addition to any legal, due diligence and/or other fees or costs VALENTEC may be
required to pay. PAPIRI makes no representation of the Company with respect to
its financial or legal status.
VALENTEC agrees to ▇▇▇▇▇ ▇▇▇▇▇▇ piggy back registration rights for all shares
and/or warrants granted/payable to PAPIRI and to include all such shares and/or
warrants on the first registration statement filed to register any shares issued
by VALENTEC to an Investor (*s) and/or the officers, directors, and/or five
percent shareholders of VALENTEC unless the Investor does not authorize such
piggyback registration or PAPIRI's shares and/or warrants are able to be sold
under Rule 144.
PAPIRI's services will be limited to introducing VALENTEC to a Company and/or
Investor possibly interested in entering into a Transaction with VALENTEC for
the purpose of VALENTEC becoming an SEC registered public traded company. PAPIRI
has not, and will not be involved in the structuring of the Transaction or in
the related discussions and/or negotiations between VALENTEC and the Company
and/or Investor. Additionally PAPIRI will not be involved in conducting due
diligence, or in making any buy-or-sell recommendations related to the
Transaction, and will have, no involvement in drafting a placement memorandum.
PAPIRI is not a licensed broker dealer or placement agent, and is not acting in
such a capacity. The above referenced fees are for consulting, and introductory
purposes only.
Initialed: _______ * _______
1
[ILLEGIBLE] any government or regulatory agency VALENTEC agrees that except for
VALENTEC's officers, directors, counsel, accountants and other professionals
with a need to know, VALENTEC will not discuss with any party any part of this
Agreement, including but not limited to the name and/or contact information of
any Investor ('s), the name and/or contact information of any Investor (*s), the
status of any discussions or negotiations entered into with any party introduced
by PAPIRI, or the amounts of any fees to be paid under this Agreement, without
the express written permission of PAPIRI.
PAPIRI and VALENTEC agree to indemnify and hold harmless each other from any
claims, costs, damages, or expenses resulting from any damage, or loss that may
arise from their introductions and or dealings.
This Agreement may be executed in one or more counterparts, all of which
together shall constitute one and the same Agreement.
Any provision in this Agreement held to be invalid or unenforceable, shall be
reformed to the extent strictly necessary to render it enforceable, without
impairing or affecting the validity and enforceability of the remainder of this
Agreement.
The Parties are entitled to seek any and all legal remedies if circumvention of
this Agreement occurs, including, but not limited to, any and all court or
arbitration costs and any other costs or charges reasonably necessary to resolve
the controversy. This Agreement shall be governed by the laws of the State of
New York, without regard to its provisions regarding conflicts of law. The
parties expressly agree to jurisdiction of the American Arbitration Association
in New York County in the State of New York.
This Agreement shall be binding between The Parties and supersedes any existing
Agreements concerning them with respect to the subject matter, and may be
modified only by written Agreement duly executed by both The Parties. This
Agreement shall terminate upon its second anniversary, except where explicitly
stated otherwise.
VALENTEC SYSTEMS, INC. ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
By: _________________________ By: /s/ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
Name & Title: _______________ -----------------------------
Date: _______________________ _________________________________
Date: 3/13/05
Initialed: _______ * ________
2
PROFESSIONAL SERVICES, INDEPENDENT CONTRACTOR AGREEMENT
BETWEEN
VALENTEC SYSTEMS, INC.
AND
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇
THIS AGREEMENT is entered into as of the 1st day of May, 2005, by and between
Valentec Systems, Inc., having a place of business at ▇▇▇▇ ▇▇▇▇ ▇▇▇., ▇▇▇▇▇▇, ▇▇
▇▇▇▇▇ (hereinafter referred to as the "COMPANY") and ▇▇. ▇▇▇▇▇▇ ▇▇▇▇ having a
place of business at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇,. ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ (hereinafter
referred to as the "INDEPENDENT CONTRACTOR").
The parties agree as follows:
1. The term of AGREEMENT shall be from 1st May, 2005 to 30 April, 2006 (the
"Term") and thereafter on an as needed basis as required by the COMPANY.
During the Term of the AGREEMENT, the INDEPENDENT CONTRACTOR shall perform
services as defined on Purchase Order VSI-05-272 which is incorporated
herein and attached hereto and an integral part of this AGREEMENT.
2. The COMPANY agrees to pay the INDEPENDENT CONTRACTOR at the rate of $2,000
per month plus expenses pre-approved by the COMPANY. All travel shall be
at the request of the COMPANY.
3. The INDEPENDENT CONTRACTOR will at all times maintain appropriate
professional credentials, conduct all affairs in accordance with the
highest legal, moral and ethical standards and provide professional
services of a quality acceptable to the COMPANY.
4. For each monthly payment of service, the INDEPENDENT CONTRACTOR shall
submit to the COMPANY an invoice for services performed accompanied by a
monthly statement describing in well defined detail the work performed.
The INDEPENDENT CONTRACTOR'S bills and statements shall be in a form
acceptable to the COMPANY.
5. The compensation set forth in this AGREEMENT shall be the sole
compensation payable to the INDEPENDENT CONTRACTOR by the COMPANY for any
services rendered hereunder.
6. The INDEPENDENT CONTRACTOR shall be free to exercise discretion and
independent judgement as to the method and means of performance hereunder.
The INDEPENDENT CONTRACTOR acknowledges and agrees that he is not an
employee of the COMPANY and shall not, by virtue of this AGREEMENT or any
other relationship with the COMPANY, be entitled to any benefits or
privileges provided by the COMPANY to its employees.
7. Specifically, the INDEPENDENT CONTRACTOR acknowledges and agrees that he
is not insured under any COMPANY policy of Workers Compensation or any
other insurance. The INDEPENDENT CONTRACTOR agrees that they shall, at his
or her own expense, acquire whatever
Independent Contractor Agreement
Between Valentec and ▇▇. ▇. ▇▇▇▇, ▇▇.
employment related insurance coverages that he or she may require or are
required by any applicable Statute, Law and/or Regulation or Term of
Contract.
8. In view of the confidential relationship contemplated hereunder between
the INDEPENDENT CONTRACTOR and the COMPANY and of the payments to be made
to the INDEPENDENT CONTRACTOR as herein set forth, the INDEPENDENT
CONTRACTOR agrees:
a. The INDEPENDENT CONTRACTOR will not disclose at any time
either during or subsequent to the Term, any proprietary or
confidential information, knowledge or data of the COMPANY
which the INDEPENDENT CONTRACTOR may receive or obtain,
including that acquired or developed by Consultant, in the
performance of the AGREEMENT unless said disclosure is
authorized by COMPANY Executive Management.
b. All data, and any and all other tangible information or works,
including, but not linked to, any and all written information
which may be or has been furnished to the INDEPENDENT
CONTRACTOR and which may be produced, prepared, or designed by
the INDEPENDENT CONTRACTOR shall remain the exclusive property
of the COMPANY. The INDEPENDENT CONTRACTOR shall not make
copies of any such materials except to the extent required to
enable the INDEPENDENT CONTRACTOR to perform services under
this AGREEMENT.
c. In the conduct of work under this AGREEMENT, the INDEPENDENT
CONTRACTOR shall not communicate or otherwise disclose to the
COMPANY confidential or proprietary information, including
trade secrets, of others.
9. THE INDEPENDENT CONTRACTOR represents and warrants to the COMPANY that:
a. With respect to any information, knowledge or data disclosed
by the INDEPENDENT CONTRACTOR to the COMPANY in the
performance of this AGREEMENT, The INDEPENDENT CONTRACTOR has
the full, unrestricted and legal right to disclose the same.
b. The INDEPENDENT CONTRACTOR is free to undertake the services
required by this AGREEMENT and there is no conflict of
interest between the INDEPENDENT CONTRACTOR'S Performance of
the AGREEMENT and any obligation the INDEPENDENT CONTRACTOR
may have to other parties or clients for whom he or she has or
is currently providing services.
c. The INDEPENDENT CONTRACTOR will perform all acts consistent
with applicable state and federal laws.
10. This AGREEMENT is intended to secure for the COMPANY the professional
services of the INDEPENDENT CONTRACTOR, and while permitting the
INDEPENDENT CONTRACTOR'S normal performance of Professional activities, it
shall operate to Preclude INDEPENDENT CONTRACTOR from accepting employment
or engaging in any activity which, in accordance with normal
2
Independent Contractor Agreement
Between Valentec and ▇▇. ▇. ▇▇▇▇, ▇▇.
standards of professional ethics, may conflict or otherwise interfere with
the INDEPENDENT CONTRACTOR'S obligations to the COMPANY. If any question
of possible conflict of interest arises, the INDEPENDENT CONTRACTOR will
call the COMPANY'S attention to the situation and confer with the COMPANY
concerning the facts involved.
11. This AGREEMENT shall be governed by, and construed in accordance with, the
laws of the District of Louisiana.
12. The INDEPENDENT CONTRACTOR will not publish to third parties or otherwise
advertise any affiliation with the COMPANY under this AGREEMENT without
the written consent of the COMPANY.
13. Either party may terminate this AGREEMENT upon thirty (30) days written
notice to the other. In any such event, the COMPANY will pay for any
services rendered and pre-approved travel expenses incurred through the
termination date and the INDEPENDENT CONTRACTOR will continue to adhere to
the requirements of paragraph 9 hereof until released by the COMPANY. In
the event of a termination, by either party, the COMPANY shall not be
liable to pay for any INDEPENDENT CONTRACTOR services rendered beyond the
termination date.
14. This AGREEMENT, Statement of Work and Purchase Order Number VSI-05-272
shall constitute the sole agreements between the parties hereto with
respect to the subject matter and no change or amendment to this AGREEMENT
shall be binding unless in writing and signed by both parties. This
AGREEMENT will remain in force and effect until such time that either
party terminates it in writing pursuant to paragraph 13.
IN WITNESS WHEREOF, the Parties have duly executed this AGREEMENT.
INDEPENDENT CONTRACTOR VALENTEC SYSTEMS, INC.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇ BY: __________________________________
---------------------
3
EMPLOYMENT, CONFIDENTIALITY,
NON-COMPETITION AND SEVERANCE AGREEMENT
THIS EMPLOYMENT, CONFIDENTIALITY, NON-COMPETITION AND SEVERANCE AGREEMENT (the
"Agreement") as of August 3, 2005 is made and entered into by and between
Valentec Systems, Inc. a Delaware corporation (the "Company"), and ▇▇▇▇▇▇ ▇▇▇▇▇
(the "Executive").
WHEREAS, the Company and Executive believe that it is in their respective
best interests to enter into and deliver this Agreement; and
WHEREAS, the Company and Executive agree that this Agreement shall
supersede and replace, as of the date of this Agreement, any existing employment
agreement in its entirety; and
WHEREAS, the Executive will serve as a senior executive of the Company and
is expected to make major contributions to the short and long-term
profitability, growth and financial strength of the Company; and
WHEREAS, the Executive acknowledges that in the course of his employment
by the Company, he will or may have access to and become informed of the
Company's confidential information as defined herein, and will frequently come
into contact with the Company's customers and accounts such that the Executive
will influence the business and relationships between the Company and its
customers and accounts; and
WHEREAS, the Executive has agreed to certain confidentiality,
non-solicilation and non-competition agreements; and in consideration for such
agreements, the Company has agreed to pay the Executive termination payments
upon severance of the Executive's employment hereunder; and
WHEREAS, the Company recognizes that the possibility of a Change in
Control (as defined below) exists; and
WHEREAS, the Company desires to ensure both present and future continuity
of management and desires to establish certain minimum severance benefits for
certain of its senior executives, including the Executive, applicable in the
event of a Change in Control all in accordance with the terms and conditions set
forth herein; and
WHEREAS, the Company desires to ensure that its senior executives are not
practically disabled from discharging their duties in respect of a proposed or
actual transaction involving a Change in Control; and
WHEREAS, the Company desires to employ the Executive, and the Executive
desires to provide his services to the Company on the terms and conditions set
forth herein.
NOW, THEREFORE, the Company and the Executive agree as follows:
1. CERTAIN DEFINED TERMS. In addition to terms defined elsewhere herein, the
following terms have the following meanings when used in this Agreement with
initial capital letters:
a) "Base Pay" means the Executive's annual base salary as provided
herein
b) "Board" means the Board of Directors of the Company.
c) "Cause" means
(i) Conviction of any felony or other serious offence
(ii) Engagements by the Executive in misconduct, which is
materially injurious to the Company, monetarily or
otherwise;
(ii) Any act by the Executive of fraud, embezzlement or theft
in connection with his duties or in the course of his
employment with the Company or any subsidiary;
(iii) Damage by the Executive to property of the Company or
any subsidiary;
(iv) Material breach of any section of this Agreement;
(v) Engagement by the Executive in any Competitive Activity;
or
(vi) Wrongful disclosure by the Executive of secret processes
or Confidential
I information of the Company or any Subsidiary;
Notwithstanding the foregoing, the Executive shall not be deemed to have
been terminated for "Cause" hereunder unless and until the Executive
receives a copy of a resolution duly adopted by the affirmative vote of
not less than two-thirds of the Board then in office (excluding the
Executive if he is a Director) at a meeting of the Board called and held
for such purpose, after reasonable notice to the Executive and an
opportunity for the Executive, together with his counsel (if the Executive
chooses to have counsel present at such meeting), to be heard before the
Board, finding that, in the good faith opinion of the Board, the Executive
was guilty of conduct constituting "Cause" as herein defined and
specifying the particulars thereof.
(d)"Change in Control" means the occurrence during the term of this
Agreement of the following events:
(i) The acquisition by any individual, entity or group of 50%
or more of the combined voting power of the then outstanding
Voting Stock.
(ii) Consummation of (A) a reorganization, merger or
consolidation or (B) a sale or other disposition of all or
substantially all of the assets of the Company
2
(iii) Approval by the stockholders of the Company of a
complete liquidation or dissolution of the Company.
(e) "Competitive Activity" means the Executive's participation, without
the written consent of the Board of the Company, as an employee, officer,
consultant, director or stockholder of any business enterprise if such
enterprise engages in substantial and direct competition with the Company.
"Competitive Activity" will not include the ownership of less than 5% of
the stock of a corporation that competes with the Company and the exercise
of the rights appurtenant thereto.
(f) "Disabled" means the Executive's incapacity due to physical or mental
illness to substantially perform his duties on a full-time basis for six
consecutive months unless the Executive returns to the full-time
performance of the Executive's duties for a period of at least three
consecutive months no later than 30 days after the Company has given the
Executive a notice of termination.
(g) "Effective Date" means the date herein of this Agreement.
(h) "Employee Benefits" means the perquisites, benefits and service credit
for benefits as provided under any and all employee retirement income and
welfare benefit policies, plans, programs or arrangements in which
Executive is entitled that may now exist or any equivalent successor
policies, plans, programs or arrangements that may be adopted hereafter by
the Company.
(i) "Employment Provisions" means the provisions relating to the
Executive's employment with the Company as set forth in this Agreement.
(j) "Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time.
(k) "Involuntary Termination" means the occurrence of any of the
following: (i) the Company gives written notice to the Executive that the
Company intends to terminate the Employment Provisions (as defined below),
(ii) unless otherwise agreed by the Executive, the Company relocates the
Executive or his offices or the principal place where he is required to
perform his duties to a location that creates a physical or financial
hardship on the Executive without reasonable compensation.
(1) "Payment Period" means the standard accepted payment period
established by the company for officers of the company.
(m) "Subsidiary" means an entity in which the Company directly or
indirectly beneficially owns 50% or more of the outstanding Voting Stock.
(n)"Termination Date" means the date on which the Executive's employment
with the Company is terminated.
(o) "Voluntary Termination" means the occurrence of any of the following:
(i) after the Executive gives written notice to the Company that the
Executive intends to terminate the
3
Employment Provisions, (ii) the Executive dies or (iii) the Executive
becomes Disabled.
(p) "Voting Stock" means securities entitled to vote generally in the
election of directors.
2. REPRESENTATIONS OF THE EXECUTIVE
(a) The Executive hereby represents and warrants that he is fully
qualified, experienced and well-skilled for the best performance of
his undertakings and responsibilities contained herein.
(b) The Executive hereby represents and warrants that he is not engaged
in any prior commitments to any third parties and there are no
hindrances of nay kind to his engagement and execution of this
agreement.
(c) The Executive hereby represents and warrants that to the best of his
knowledge he is healthy and does not suffer from any illness or
infirmity that may hinder or impair the best performance of his
undertakings and responsibilities contain herein.
3. TERM
(a) The term of this Agreement commences on the Effective Date and
expires on the earliest of (i) any involuntary Termination, (ii) a
Voluntary Termination or (iii) five years from the date hereof,
except that the Employment Provisions shall automatically renew for
successive one- year periods upon the terms and conditions set forth
herein, commencing on the first anniversary of the date hereof, and
on each anniversary date thereafter, until an Involuntary
Termination or Voluntary Termination occurs. For purposes of this
Agreement, any reference to the "term" of the Employment Provisions
includes the original term and any extension thereof.
(b) The Executive undertakes that immediately upon termination of the
employment with the Company, for any reason, to act as follows: (a)
deliver and/or return to the Company all documents, CDs, diskettes
or other magnetic media, letters, notes, reports, business cards and
other papers in the Executive's possession and relating to his
employment with the Company, as well as any equipment and/or other
property belonging to the Company which was placed at the
Executive's disposal and (b) delete any information relating to the
Company or its business form Executive's personal computer; and (c)
coordinate with the Company the orderly handing over of Executive's
position according to the timetable determined by the Company, and
the Executive shall hand over in any orderly fashion in coordination
with the Company his position, the documents and all other matters
dealt with by the Executive to whomever the Company instructs.
4. EMPLOYMENT. The Company hereby agrees to employ the Executive, and the
Executive hereby agrees to be employed by the Company, upon the terms and
conditions herein set forth.
4
5. DUTIES OF THE EXECUTIVE.
(a) The Executive shall serve as Chief Executive Officer of the Company.
The Executive shall report directly to The Board and shall exercise
such authority, perform such executive functions and discharge such
responsibilities as are reasonably associated with the Executive's
position, consistent with the governing documents of the Company.
(b) In carrying out his responsibilities under this Agreement, The
Executive undertakes to act effectively, and to apply the best of
his qualifications, experience and wide knowledge, in order to
discharge his duties in the best way possible. The Executive shall
act in a dedicated and loyal manner, and shall refrain from acting
in a manner, whether directly or indirectly, actively or
neglectfully, which may cause damage or loss to the Company and/or
to its operation.
(c) The Executive undertakes and Agrees to devote his entire working
energy and tome top he performance of his duties under this
Agreement. Unless agreed other wise in advance and in writing by the
Board the Executive shall not be engaged during the term of this
Agreement, directly or indirectly in the performance of any other
employment and/or services for any other entity, not shall he act as
an independent contractor for any entity other than the Company.
6. COMPENSATION.
(a) The Company shall pay the Executive a base salary of
$__________________________________,000 per annum, which I base
salary the Board may adjust from time to time at its sole
discretion, payable at the times and in the manner consistent with
the Company's general policies regarding compensation of senior
executives. Such base salary includes any salary reduction
contributions to (i) any Company-sponsored plan (the "401(k) Plan")
that includes a cash-or-deferred arrangement under Section 401(k) of
the Internal Revenue Code of 1986, as amended (the "Code"), (ii) any
other Company-sponsored plan of deferred compensation or (iii) any
Company sponsored "cafeteria plan" under Section 125 of the Code.
(b) Executive shall be eligible to participate incentive compensation
under the Company's executive incentive compensation plan or such
management incentive program or arrangement as may be approved by
the Board to include but not limited to a six percent (6%) yearly
increase in base pay, automobile allowance, Country Club membership
and incentive bonus arrangement ranging from 50% to 100% of base
salary.
(c) The Company will grant to Executive stock options as defined in the
Company's Employee Stock Option Plan (Exhibit "A"), all in
accordance with the terms and conditions of an Option Agreement to
be entered into between the Company and the Executive
(d) The Company shall purchase and maintain term life insurance coverage
on the life of
5
Executive in an amount not less than $1,000,000, the proceeds of
which, in the event of Executive's death during the term of the
Agreement, shall payable to the company for the purpose of
recruiting and hiring a qualified replacement.
(e) The Company shall purchase and maintain a disability policy that
would entitle Executive, should he become Disabled during the term
of this Agreement, to receive 60% of Executive's then current base
salary, which policy shall be in addition to any disability coverage
obtained by the Executive on his own behalf.
7. TERMINATION PAYMENTS.
(a) If an Involuntary Termination occurs other than for Cause;
(i) For the remaining term of this Agreement (Section 3) (the
"Payment Period") the Company shall pay the Executive, in
accordance with the Company's regular payroll schedule or if
agreed to by the Executive and the Company in a single lump
sum payment equal to the sum of the payments due or to a
mutually negotiated amount
(ii) During the Payment Period, the Company shall (A) to the
extent permitted under the 401(k) Plan, permit the Executive
to continue to participate in the 401(k) Plan and receive the
maximum matching contribution thereunder as if such
Involuntary Termination had not occurred or (B) if continued
participation in the 401(k) Plan is not permitted under the
401(k) Plan, pay to the Executive an amount equal to the
maximum matching contribution to which he would have been
entitled under the Company's 401(k) Plan as if such
Involuntary Termination had not occurred; and
(iii) Notwithstanding anything to the contrary in the
Company's Employee Stock Option plan (Exhibit "A") under which
Executive's stock options shall be granted, all of Executive's
stock options granted shall continue to vest during the
Payment Period at the times and in the amounts that would
apply if such Involuntary Termination had not occurred, and
Executive shall have the right to exercise any and all vested
stock options at any time no later than 90 days after the
expiration of the Payment Period.
(b) If the Executive dies while any amounts are payable to him hereunder, all
such amounts, unless otherwise provided herein, shall be paid to the Executive's
designated beneficiary, or, if none, then to the Executive's estate.
(g) Notwithstanding the foregoing, if the Executive breaches this Agreement any
right of the Executive to receive termination payments, to have the vesting of
his options continued or to the period during which he may exercise his options
as stipulated above, shall be forfeited, but without prejudice to any exercise
of options that may have occurred prior to such forfeit, and the Executive shall
reimburse the Company in full for all termination payments made to the Executive
no later than 30 days after the Company gives notice of such breach to the
Executive.
8. TERMINATION FOLLOWING A CHANGE IN CONTROL.
6
(a) If following the occurrence of a Change in Control the Executive terminates
his employment with the Company, the Executive shall be entitled to the benefits
provided by Section 6 if one or more of the following events has occurred
(regardless of whether any other reason, other than Cause as hereinabove
provided, for such termination exists or has occurred, including without
limitation other employment);
(i) Failure to elect or reelect or otherwise to maintain the
Executive in the office or the position, or a substantially
equivalent office or position, of or with the Company, which
the Executive held immediately prior to a Change in Control,
or if the Executive was a Director of the Company immediately
prior to the Change in Control, the removal of the Executive
as a Director of the Company (or any successor thereto);
(ii) (A) a reduction in the aggregate of the Executive's Base
Pay received from the Company and any Subsidiary from that
earned immediately prior to the Change in Control or (B) the
termination or denial of the Executive's rights to Employee
Benefits or a reduction in the scope or value thereof from
that earned immediately prior to the Change in Control, any of
which is not remedied by the Company no later than 10 calendar
days after receipt by the Company of written notice from the
Executive of such change, reduction or termination, as the
case may be;
(iii) A determination by the Executive that a change in
circumstances has occurred following a Change in Control,
including, without limitation, a change in the scope of the
business or other activities for which the Executive was
responsible immediately prior to the Change in Control, which
has rendered the Executive substantially unable to carry out,
has substantially hindered Executive's performance of, or has
caused Executive to suffer a substantial reduction in, any of
the authorities, powers, functions, responsibilities or duties
attached to the position held by the Executive immediately
prior to the Change in Control, which situation is not
remedied no later than 10 calendar days after receipt by the
Company of written notice from the Executive of such
determination;
(iv) The liquidation, dissolution, merger, consolidation or
reorganization of the Company or transfer of all or
substantially all of its business and/or assets, unless the
successor or successors to which all or substantially all of
its business and/or assets have been transferred assumed all
duties and obligations of the Company under this Agreement;
(v) The Company relocates its principal executive offices, or
requires the Executive to have his principal location of work
changed, to any location that creates a physical or financial
hardship on the Executive, or
(vi) Without limiting the generality or effect of the
foregoing, any material breach of this Agreement by the
Company or any successor thereto which is not remedied by the
Company within 10 calendar days after receipt by the
7
Company of written notice from the Executive of such breach.
9. CONFIDENTIALITY AGREEMENT.
(a) The Executive understands that the Company possesses Confidential
Information (as defined below) which is important to the Company's
business and that this Agreement creates a relationship of
confidence and trust between the Executive and the Company with
regard to Confidential Information.
(b) For the purposes of this Agreement, "CONFIDENTIAL INFORMATION" shall
mean information that was or will be developed, created, or
discovered by or on behalf of the Company, its Subsidiaries,
affiliates and predecessors, or is developed, created or discovered
by the Executive while performing the services under this Agreement,
or which became or will become known by the Executive or was or is
conveyed to the Executive which has commercial value in the
Company's and its Subsidiaries and affiliates' business.
Confidential Information includes, but is not limited to trade
secrets, ideas, techniques, business, product, or development plans,
customer information, and may other information concerning the
Company's, its Subsidiaries and affiliates' actual or anticipated
business, development personnel information or which is received in
confidence by or for the Company and its affiliates form any other
party.
(c) At all times, both during the term of this Agreement and after its
termination, the Executive will keep in confidence and trust, and
will not use or disclose to any third party, any confidential
information without the prior written consent of the Company's Board
of Directors.
(d) Immediately upon the termination of this Agreement for any reason,
the Executive shall return to the Company all Confidential
Information or any part thereof as requested and shall not retain
any copy or other form of Confidential Information and shall not
furnish same to any other party, absent the Company's express
written consent.
(e) The Executive's undertakings with respect to the Confidential
Information shall remain in effect throughout the term of this
Agreement and indefinitely thereafter unless any of it becomes
public domain through no fault of the Executive
10. COVENANT NOT TO COMPETE;
In consideration for the Executive's employment hereunder and for a period
of four (4) years after Voluntary Termination or Involuntary Termination,
the Executive shall not without prior consent of the Company engage in any
activity that competes with the Company.
11. SPECIFIC ENFORCEMENT.
The Executive acknowledges and agrees that a violation of Sections 9 or 10
hereof that results in material detriment to the Company would cause irreparable
harm to the Company, and that the Company's remedy
8
at law for any such violation would be inadequate. In recognition of the
foregoing, the Company shall have the right, in addition to any other relief
afforded by law or this Agreement, including damages sustained by a breach of
this Agreement and any forfeitures under Section 10, and without any necessity
or proof of actual damages, to enforce this Agreement by specific remedies,
including, among other things, temporary and permanent injunctions.
12. ARBITRATION.
Any dispute between the parties under this Agreement shall be resolved (except
as provided below) through arbitration by an arbitrator selected under the rules
of the American Arbitration Association (located in the State of Louisiana) and
the arbitration shall be conducted in that location. The arbitrator shall have
the right only to interpret and apply the provisions of this Agreement and may
not change any of its provisions. The determination of the arbitrator shall be
conclusive and binding upon the parties and judgment upon the same may be
entered in any court having jurisdiction thereof. The arbitrator shall give
written notice to the Company and the Executive stating its determination, and
shall furnish to each party a signed copy of such determination. The expenses of
arbitration shall be borne equally by the Executive and the Company or as the
arbitrator shall otherwise equitably determine.
Notwithstanding the foregoing, the Company shall not be required to seek or
participate in arbitration regarding any breach of Sections 9 or 10, but may
pursue its remedies for such breach in any court of competent jurisdiction in
the State of North Carolina. Any arbitration or action pursuant to this Section
21 shall be governed by and construed in accordance with the substantive laws of
the State of North Carolina without giving effect to the principles of conflict
of laws of such State.
13. NOTICES.
For all purposes of this Agreement, all communications, including without
limitation notices, consents, requests or approvals, required or permitted to be
given hereunder shall be in writing and shall be deemed to have been duly given
when hand delivered, or three business days after having been sent by a
nationally recognized overnight courier service
If to the Executive: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
If to the Company Secretary
Valentec Systems, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
or to such other address as either party may have furnished to the other
in writing
14. GOVERNING LAW.
The validity, performance interpretation and construction of this Agreement
shall be governed and constructed in accordance with the substantive laws of the
State of Louisiana without giving effect to the principles of conflict of laws
effect of such State.
9
15. AGREEMENT.
This Agreement supersedes any and all other agreements between the parties
hereto with respect to the subject matter hereof and contains all of the
covenants and agreements between the parties with respect to such subject
matter.
16. SUCCESSORS AND BINDING AGREEMENT.
(a) The Company shall require any successor to assume and agree to
perform this Agreement in the same manner and to the same extent the
Company would be required to perform if no such succession had taken
place.
(b) This Agreement will inure to the benefit of and be enforceable by
the Executive's personal or legal representatives, executors,
administrators, successors, heirs, distributees and legatees.
(c) This Agreement is personal in nature and neither the Company nor the
Executive shall, without the consent of the other, assign, transfer
or delegate this Agreement or any rights or obligations hereunder
except as expressly provided in this Section
17. VALIDITY.
If any provision of this Agreement or the application of any provision hereof to
any person or circumstances is held invalid, unenforceable or otherwise illegal,
the remainder of this Agreement and the application of such provision to any
other person or circumstances shall not be affected, and the provision so held
to be invalid, unenforceable or otherwise illegal shall be reformed to the
extent (and only to the extent) necessary to make it enforceable, valid or
legal.
18. MISCELLANEOUS
No provision of this Agreement may be modified, waived or discharged unless such
waiver, modification or discharge is agreed to in writing signed by the
Executive and the Company.
IN WITNESS WHEREOF, the Company and the Executive have executed this Agreement
as of the date first above written
VALENTEC SYSTEMS, INC. Agreed To and acknowledged
By: _______________________________________ By: __________________________
▇▇. ▇▇▇▇ Gilat Vice-Chairman ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇
Board of Directors
Date: _____________________________________ Date: ________________________
10
PROFESSIONAL REPRESENTATION AGREEMENT
BETWEEN
VALENTEC SYSTEMS, INC
AND
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇
This Professional Representation, Agreement (the "Agreement") is entered into as
of the 15th day of September 2005, by and between Valentec Systems, Inc., having
a place of business at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (hereinafter referred
to as the "Company") and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇, having an address at ▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇., ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, hereinafter referred to as
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ IV
WHEREAS, Company is engaged in the sale of Chemical Laboratory services and is
in the process of seeking new customers.
WHEREAS, Representative is engaged in the business of providing sales, advice
and administrative services for such services; and
WHEREAS, Company desires to secure the services of the Representative to obtain
contracts for Chemical Laboratory services and the Representative desires to
provide such services to the Company.
NOW, THEREFORE, in consideration of these premises and the mutual covenants
contained herein, the parties do hereby agree as follows:
1. APPOINTMENT OF REPRESENTATIVE .
Company hereby appoints Representative and Representative agrees to serve as
Company's representative in fulfillment of Company's contracts for Chemical
Laboratory services in accordance with the terms and conditions of this
agreement.
Representative shall be considered an independent contractor. The relationship
shall not be construed to be that of employer and employee and shall not
constitute a partnership, joint venture or agency of any kind between the
Representative and the Company.
Representative agrees to pay and be responsible for all expenses incurred
directly or indirectly in connection with services to be performed under this
Agreement, including, travel, lodging and entertainment. Representative shall
make no claim whatsoever against the Company for any expenses or costs
whatsoever in connection with this Agreement, except as identified in paragraph
5.
Representative shall have no right or authority to make or undertake any
promise, warranty, guarantee or representation, to incur any liability or
commence legal proceeding, to execute any contract or otherwise assume any
obligation or responsibility in the name of or on behalf of the Company, unless
specifically authorized in writing prior to such actions by an authorized
representative of the Company.
2. DUTIES OF REPRESENTATIVE
Customer sales calls - Representative will spend a portion of each day calling
potential new customers and arranging meetings to discuss the services Chemical
Laboratory Services Company can offer to their operation. Lost customers will
also be contacted as needed in order to reestablish business through new
mutually agreeable terms. Current customers will be contacted as needed in order
to insure their needs are being met and to investigate more potential business.
Sales Proposals - Upon meeting the customers and determining their needs,
Representative will provide a sales proposal outlining the Services Company will
provide and the compensation Company for such services. All sales proposals will
first be sent to the Company for approval or editing. All revisions will also be
sent to the Company for review and comment. Customers will receive the proposal
only after final approval has been given by the authorized Company
representative.
Fielding Incoming Calls - Representative will be available as often as possible
during normal business hours to receive customer calls as well as calls from
Company personnel. Normal business hours will be from approximately 8:00A.M. to
5:00 P.M., Monday through Friday, excluding holidays. If Representative is not
available to receive calls, Representative will review and reply to all messages
as soon as possible.
Future Sample Drop Off Point - If future business dictates a need,
Representative's office may serve as a local sample drop off point. If the
Company decides to use this office in this capacity, changes to Representative's
current office agreement may be required to insure the security and integrity of
chemical samples. These changes, if any, will be addressed through a
modification to this Agreement.
Representative shall indemnify, protect and hold the Manufacturer, its
affiliated companies and all officers, directors, employees and agents thereof
harmless from any and all costs, including attorney's fees, related claims,
demands, suits or actions which may be instituted by any third party, including
but without limitation, any cost resulting from actions of representatives of
the Representative or any indemnities arising out of or incident to the conduct
of the Representative's operation under this agreement.
Representative shall maintain the confidentiality of all information pertaining
to the Manufacturer's contracts. The provisions of this paragraph shall survive
the termination of this agreement.
3. RESPONSIBILITIES OF THE COMPANY
The Company shall provide Representative with such written documentation as may
be necessary for the Representative to perform his responsibilities under this
Agreement. The Representative shall use such documentation solely for the
purpose of performing services under this Agreement, shall permit no
unauthorized person to have access thereto and shall take all reasonable
precautions against the loss, theft or destruction thereof. Upon termination of
the Agreement, the Representative shall return to Company all such written
matter and any copies thereof then in his possession.
The Company shall have no financial obligations to the Representative other than
those stated in this agreement.
4. RELATIONSHIP OF THE PARTIES
Representative shall be considered an independent contractor. The relationship
shall not be construed to be that of employer and employee and shall not
constitute a partnership, joint venture or agency of any kind between the
Representative and the Company.
5. COMPENSATION
Representative shall be compensated for services as follows:
The Company will tender $1,000.00 per month toward expenses and future
commissions. The commission structure shall be based on annual sales revenue.
This payment will be made on or about the 15th first day of each calendar month,
beginning 15 September 2005
Annual Sales Revenue Percent of Revenue as Commission
--------------------- --------------------------------
Up to $100,000 5%
$100,000 to $300,000 4%
Over $300,000 3%
A Compensation Example is shown on Attachment A.
Allowable business expenses will not be deducted from commission paid to
Representative. Representative will be provided a cash advance of $200.00 which
the Company will replenish on a monthly basis upon submittal of an expense
report detailing the allowable expenditures. Allowable business expenses include
general office expenses and support, automobile mileage reimbursed at
$0.405/mile, cell phone at $30.00/month, minimal business lunches submitted on
an expense report and not-to-exceed $75.00/month, and other justifiable business
expenses. Unallowable business expenses include personal travel mileage.
6. BUSINESS PRACTICES
Representative hereby warrants and represents that in performing this Agreement,
Representative shall comply and shall cause its representative to comply with
all applicable laws, rules, regulations and policies of the United States and
all applicable laws, rules, regulations and policies of the State of Louisiana.
Representative shall indemnify and hold the Company harmless from and against
any claims arising out of Representative's actions or costs incurred as a result
of the Representative's failure to act.
7. AGREEMENT TERM AND TERMINATION
This Agreement shall be valid for four months from the date shown above and is
renewable by mutual agreement for a six month period.
This Agreement may be terminated at any time by either party by giving of thirty
days written notice to the other party. Should the Company terminate the
Representative pursuant to this paragraph, the Company shall pay to the
Representative that portion of the fee which he has earned under their terms of
this agreement.
8. MODIFICATION
No modification or change may be made to the Agreement or become effective,
except by written instrument duly signed by the Representative and an authorized
representative of the Company.
9. ASSIGNMENT
This Agreement may not be assigned or transferred by either party without the
written consent of the other party, except that the Manufacturer may assign this
Agreement to any of its affiliated organizations.
10. NOTICE
All notices given under this Agreement shall be in writing and shall be
addressed to the parties at their respective addresses set forth below:
Company: Representative:
Attn: ▇▇▇▇▇ Shows Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇
Valentec Systems, Inc. ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇
11. WAIVER
None of the conditions of provisions of this Agreement shall be held to have
been waived by any act or knowledge on the part of either party, except by an
instrument in writing signed by a duly authorized representative of each of the
parties.
14. ENTIRE AGREEMENT
This Agreement supersedes and cancels any previous agreements or understandings,
whether oral, written or implied, heretofore in effect between the Company and
the Representative, and sets forth the entire agreement between the parties. The
parties specifically acknowledge that there are no explanatory or supplemental
undertakings, either oral or in writing.
In Witness whereof, the parties hereto have caused this Agreement to be executed
on the day and year first above written.
Valentec Systems, Inc. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇
/s/ ▇▇▇▇▇ Shows /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------- ------------------------
▇▇▇▇▇ Shows ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇
Vice President & G.M.
Attachment A
COMPENSATION EXAMPLE
An example of the compensation methodology is :
1. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇ (WBM) during the period of September through
November 2005 "sells" Valentec Chemical Laboratory services of
$180,000.
2. Therefore, WBM has earned or "banked"
$100,000 X .05 = $5,000
$ 80,000 X .04 = 3,200
------
$8,200
3. During the September through November 2005 time frame WBM has been
compensated, as an advance against earnings, $3,000.
4. WBM actually is compensated $1200/month beginning 1 October of which
$1,000 is an Advance against earnings and $200 is an expense
advance. A monthly expense report is required for re-establishment
of the advance.
5. This contract will be renewed and re-calculated every 6 months,
after the first 4 months segment, to more appropriately compensation
WBM for sales activity. The base compensation will remain $1,000;
however, this may increase based on the amount of sales WBM has
"banked".
