Employment Agreement
This Employment Agreement (the "Agreement") is made by Prime Resource, Inc.,
("the Company"), and Xxxxxx Xxxxxxx, ("the Employee" or "Xxxxxxx").
Xxxxxxx and Prime Resource, Inc., will be referred to individually as a Party
and collectively as the Parties. The Parties agree as follows:
1. Employment. Company shall employ Employee as Secretary/Treasurer and
Chief Financial Officer (CFO). Employee accepts and agrees to such employment,
subject to the general supervision, advice and direction of the Board of
Directors. Employee shall: (i) strategically plan and then manage all general
financial and record keeping affairs of the Company and its subsidiaries
consistent with directives from the Board of Directors including private and
public offerings and loans; (ii) supervise any internal auditing and financial
preparation functions; (iii) perform such duties as are customarily performed by
an employee in a similar position and by the Bylaws; and (iv) perform all
services and duties as may be assigned to the Employee from time to time by the
Board of Directors.
2. Best Efforts of Employee. Employee agrees to perform faithfully,
industriously, and to the best of Employee's ability, experience, and talents,
all of the duties that may be required by the express and implicit terms of this
Agreement, to the satisfaction of Company. Employee shall perform such duties at
such place(s) as the needs, business, or opportunities of the Company or its
subsidiaries may require on a full-time basis.
3. Duties of Xxxxxxx. Employee acknowledges that as an existing principal
officer of Prime, he has a fiduciary duty to the Company. Employee agrees to
disclose all potential business opportunities to the Company, not to compete
against the Company during his employment, and not to become involved in any
activities that create a conflict of interest (or potential conflict of
interest) between the Company and the Employee during his employment. The
Employee also agrees to promptly keep the Board of Directors aware of all
investments and business activities that the Employee is directly or indirectly
involved in, and all business activities or investments in which the Employee
has a direct or indirect financial interest that may have the likelihood of
impacting the company during his employment. The Employee agrees not to do
business in competition with the Company during his employment. The Employee
agrees not to do business with any third parties who are doing business with the
Company during his employment, without the prior express written consent of the
Company's Board of Directors. The Employee also agrees not to participate
personally in any business deals or ventures in which the Company is
participating, is considering participating, or could participate during his
employment.
4. Compensation of Employee. As compensation for the services provided by
the Employee under this Agreement, Company will pay Employee an annual base
salary of $120,000/year to July 5, 2002, then $180,000/annually to September 31,
2002, and $210,000 annually thereafter. Annual salaries shall be pro rated and
paid on a monthly basis, and payable in accordance with the Company's usual
payroll procedures.
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(4.1) Employee shall be included to the extent eligible thereunder in
any and all plans pursuant to which the Company, or any predecessor, may provide
insurance, health care, or retirement benefits for the Company's employees,
including but not limited to insurance, 401(k) plan, flextime, sick days,
holidays, and vacation -- initially eighteen (18) days per year as more
particularly described in the Prime LLC Employment Manual. Employee's
participation in any such plan or program shall be subject to the provisions,
rules and regulations designated by the Company in its full and complete
discretion and as the Company may change from time to time, so long as the
employee is not discriminated against in any way contrary to other general
officers of the Company. Employee acknowledges no such plans or benefits have
currently been adopted by the Board, except employee shall be guaranteed 18 paid
leave days and participation in any existing plan or benefit transferred from
Prime LLC.
(4.2) In accordance with the Company's policies, established from time
to time, the Company will pay or reimburse Employee for all reasonable and
necessary out-of-pocket expenses incurred by him in the performance of his
duties under this Agreement, subject to the presentment of appropriate vouchers.
These expenses shall include but are not limited to reimbursement for Employee's
mobile phone, for business travel, for business meals, and ground transportation
when on Company business.
(4.3) Employee acknowledges that Prime does not presently have any
stock option or other stock rights programs or plans for officers or directors,
nor is there presently any bonus incentives or plans. While employee recognizes
such plans may be adopted in the future, employee explicitly agrees that the
adoption of such plans is not a promised consideration under this Agreement and
the creation or withholding of such plans by the Board of Directors is not a
consideration for this Agreement or basis for employee withdrawal. Company and
employee further agree and covenant that employee will be treated equally with
all other general officers of the Company in the creation or adoption of any
future benefits described by this paragraph or reasonably related thereto.
5. Recommendations for Improving Operations. Employee shall provide Company
with all information, suggestions, and recommendations regarding Company's
business, of which Employee has knowledge that will be of benefit to Company.
6. Confidentiality. Employee recognizes that Company has and will have
information regarding the products or services to be marketed and sold, the
clients and potential clients to which products or services are to be marketed
and sold, and the technique for marketing and selling generally (collectively
"Confidential Information" which, in its totality, is not known to the public)
which are valuable, special and unique assets of Company. The Employee agrees
that the Employee will not at any time or in any manner, either directly or
indirectly, use any Confidential Information for the Employee's own benefit or
use any of the Company's Confidential Information in any way that is directly or
indirectly in competition with the Company. Employee agrees that the Employee
will not at any time or in any manner, either directly or indirectly, divulge,
disclose, or communicate any Confidential Information to any third party without
the prior written consent of the Company. Employee will protect the Company's
Confidential Information and treat it as strictly confidential. A violation by
Employee of this paragraph shall be a material violation of this Agreement and
will justify termination and/or legal and/or equitable relief.
7. Unauthorized Disclosure of Information. If it appears that the Employee
has disclosed (or has threatened to disclose) Confidential Information in
violation of this Agreement, the Company shall be entitled to an injunction to
restrain the Employee and or the Employee's agents from disclosing, in whole or
in part, such Confidential Information, or from providing any goods or services
to any Party to whom such Confidential Information has been disclosed or may be
disclosed or from using such Confidential Information to sell goods or services.
The Company shall not be prohibited by this provision from pursuing other
remedies, including a claim for losses and damages.
8. Confidentiality After Termination. All provisions of this Agreement
regarding Confidential Information shall remain in full force and effect after
the termination of this Agreement for a period of 24 months.
9. Services to Third Parties. The Employee shall not provide any consulting
services to or enter the employment of any third Party during the course of his
employment, unless the Employee has obtained the Company's prior written
consent.
10. Return of Records, Property and Confidential Information. Upon
termination of this Agreement, the Employee shall deliver all records, customer
or supplier lists, notes, data, memoranda, models, computers, files, computer
files, recorded data, and equipment of any nature that are in the Employee's
control or possession that are the Company's property or relate to the Company's
business or that are copies of Company documents or that contain the Company's
Confidential Information.
11. Termination. Employee's employment under this Agreement shall be for a
three year term, unless terminated for cause.
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A. Termination Without Cause. This Agreement may be terminated by the
Company at any time without cause and without notice. In the event Employee is
terminated by the Company without cause prior to the three year term, the
Company shall pay to Employee, as a severance allowance, his then current
monthly Base Salary, stock options and health benefits for the three months (3
months) period following the date of termination and including the month in
which notice of termination occurs.
B. Termination For Cause. The Company may also terminate this Agreement
without notice if the Agreement is terminated for cause. For purposes of this
Agreement, termination for cause shall mean termination for fraud, embezzlement,
misfeasance, theft, or a material criminal act or any material breach of this
Agreement. In the event that Employee's employment is terminated for cause, then
Employee shall be entitled to receive Employee's then current monthly Base
Salary and any employee rights or compensation which would vest in the month of
termination, but off-set by any amounts appropriated or wrongfully taken by
Employee.
C. Effective Date. Employee's employment shall be terminated on the
earlier of: 30 days following the written submission of Employee's resignation;
or date such resignation is accepted by the Company.
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D. Resignation. In the event that Employee's employment is terminated
pursuant to Employee's resignation, then Employee shall be entitled to receive
Employee's then current monthly Base Salary and any other compensation or right
which would vest in the month the resignation becomes effective.
12. Termination for Disability or Death. Company shall have the option to
terminate this Agreement, if Employee is no longer able to perform the essential
functions of the position with reasonable accommodation. In the event of
termination for disability or death, employee shall receive the termination
rights and benefits described by paragraph 12A for termination within three
years without cause.
13. Disclosure. The Employee is required to disclose any outside activities
or interests, including ownership or participation in the development of
intellectual property or trade secrets, that may conflict or compete with the
interests of the Company. Immediate disclosure is required under this paragraph
if the activity or interest is related, directly or indirectly, to the sale or
marketing of any product similar to any product offered by Prime Resource, Inc.
or any of its subsidiaries anywhere in the world; or the sale or marketing
(anywhere in the world) of any product that is similar to or that competes with
any of the products sold by or to be sold by the Company.
14. Assignment. The Employee's obligations under this Agreement may not be
assigned or transferred to any other person, firm, corporation, or entity
without the prior written consent of the Company.
15. Intellectual Property. The following provisions shall apply with
respect to the Company's copyrightable works, trade secrets (including, but not
limited to client lists, mailing lists, data banks, marketing information,
prospect lists and information about clients and potential clients), inventions,
applications for patents, and patents (collective, "Intellectual Property").
16. Development of Intellectual Property. Any Intellectual Property and or
trade secrets (including, but not limited to, client lists, mailing lists, data
banks, marketing information, prospect lists and information about clients and
potential clients), created, developed, modified, or updated, by the Employee
during the term of the Agreement is the property of the Company. Any
improvements to Intellectual Property items of the Company including further
inventions or improvements, and any new items of Intellectual Property
discovered or developed by the Employee (or the Employee's employees, if any)
during the term of this Agreement shall be the property of the Company. The
Employee shall sign all documents necessary to protect the rights of the Company
in such Intellectual Property, including the filing and/or prosecution of any
applications for copyrights or patents. Upon request, the Employee shall sign
all documents necessary to assign the rights to such Intellectual Property to
the Company.
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17. Compliance with Company's Rules. Employee agrees to comply with all of
the rules, regulations, and guidelines of Company as they are amended from time
to time.
18. Solicitation of Customers and Solicitation of Employees:
(18.1) Employee agrees that during his employment by the Company
hereunder and for the period of two years after his termination date, he will
not, either directly or indirectly, on his own behalf or in the service or on
behalf of others, solicit, divert or appropriate, or attempt to solicit, divert
or appropriate, to any competing business (i) any person or entity whose account
with the Company was sold or serviced by or under the supervision of Employee
during the two years preceding the termination of such employment; (ii) any
person or entity whose account with the Company has been directly solicited at
least twice by the Company within the one year period prior to the date of
termination of employment; or (iii) any account existing at any financial
institution.
(18.2) Employee agrees that during his employment by the Company
hereunder and for a two year period following the termination of such employment
for any reason, he will not, either directly or indirectly, on his own behalf or
in the service or on behalf of others solicit, divert or hire away, or attempt
to solicit, divert or hire away any person then employed by the Company or then
serving as a sales representative of the Company.
19. Return of Property. Immediately upon termination of this Agreement, the
Employee shall deliver all property (including keys, records, notes, data,
memoranda, models, and equipment) that is in the Employee's possession or under
the Employee's control, which is Company's property or related to Company's
business. Such obligation shall be governed by any separate confidentiality or
proprietary rights agreement signed by the Employee.
20. Notices. All notices required or permitted under this Agreement shall
be in writing and shall be deemed delivered in person or deposited in the United
State mail, postage paid, addressed as follows:
If for the Employee: If for the Company:
Xxxxxx Xxxxxxx CEO Prime Resource, Inc.:
0000 Xxxxx Xxxxxxxxx Xxxxxx 00 Xxxx 000 Xxxxx/Xxxxxx Xxxxx
Xxxxx, XX 00000 Xxxx Xxxx Xxxx, XX 00000
Such addresses may be changed from time to time by either party by providing
written notice in the manner set forth above to the other party and attaching
proof of service of such change to this Agreement.
21. Entire Agreement. This Agreement contains the entire agreement of the
parties and there are no other promises or conditions in any other agreement
whether oral or written. This Agreement supersedes any prior written or oral
agreements between the parties.
22. Amendment. This Agreement may only be modified or amended, if the
amendment is made in writing and is signed by both parties.
23. Severability. If any provisions of this Agreement shall be held to be
invalid or unenforceable for any reason, the remaining provisions shall continue
to be valid and enforceable. If a court finds that any provision of this
Agreement is invalid or unenforceable, but that by limiting such provision it
would become valid or enforceable, then such provision shall be deemed to be
written, construed, and enforced as so limited.
24. Waiver of Contractual Right. The failure of either party to enforce any
provision of this Agreement shall not be construed as a waiver or limitation of
that party's right to subsequently enforce and compel strict compliance with
every provision of this Agreement.
25. Interpretation. This Agreement shall not be construed against the
drafting Party. Both Parties acknowledge adequate opportunity to seek legal
counsel regarding this Agreement.
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26. Applicable Law, Exclusive Jurisdiction, and Venue. This Agreement shall
be governed by the laws of the State of Utah. The Courts in Salt Lake County,
Utah have exclusive jurisdiction and the Courts in Salt Lake County, Utah are
the exclusive venue for disputes relating to the interpretation or enforcement
of this Agreement. In the event of a dispute relating to interpretation or
enforcement of this Agreement, the prevailing party shall be awarded all
reasonable attorneys' fees and costs incurred.
27. Effective Date. Regardless of the date(s) on which this Agreement is
signed, the Effective Date of this Agreement is April 5, 2001.
Prime Resource, Inc.
By: /S/ Xx. Xxxxx Xxxx April 5, 2002
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Xx. Xxxxx Xxxx
Chairman of the Board of Directors
/S/ Xxxxxx Xxxxxxx April 5, 2002
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Xxxxxx Xxxxxxx
Employee
PRIME RESOURCES/Xxxxxxx.EmployAgree
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