Exhibit 10.5
EMPLOYMENT AGREEMENT
for
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
THIS EMPLOYMENT AGREEMENT (the "Agreement") dated as of the 1Oth day
of December, 1999 by and between ▇▇▇▇.▇▇▇., INC. a Delaware
corporation (the "Employer" or "Company") and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, an individual
(the "Employee").
WITNESSETH
WHEREAS, Employee is one of the founders of the primary operating and wholly
owned subsidiary of the Company, such subsidiary, operating under the name of
New Mexico Software, Inc. a New Mexico corporation (NMS);
WHEREAS, since its inception of NMS, Employee has served as President and
Chief Executive Officer, as well as serving as one of the two Board of
Directors;
WHEREAS, the pursuant to a reverse stock merger, NMS became a wholly owned
subsidiary of the Company on August 3, 1999;
WHEREAS, the Board of Directors of the Company (the "Board") believes that the
success of the Company is based upon the know how and abilities of Employee
and considers it essential that Employee remain as an employee of the Company,
serving as President and Chief Executive Officer;
WHEREAS, Employee desires to provide his services as President and Chief
Executive Officer in connection with the Company's business; and
WHEREAS, both parties desire to clarify and specify their rights and
obligations that each have with respect to the other in connection with such
employment.
NOW, THEREFORE, in consideration of this Agreement and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged by
the parties, the parties hereto do hereby agree as follows:
1 . Employment. The Company hereby employs Employee as its President and Chief
Executive Office and Employee hereby accepts such employment and agrees to
render his services as an Employee of the Company for the term of this
Agreement (as specified in Section 6. hereof), all subject to and on the terms
and conditions herein set forth.
2. Duty. Employee shall be employed in the business of the Company and
his duties and responsibilities shall be consistent with the duties performed
and responsibilities undertaken by a President and Chief Executive Office of a
company of its size which stock is publicly traded. As such, Employee shall
have primary responsibility for following strategic and financing activities:
mergers and acquisitions,
capital raising activities, shareholder relations, exploring and sourcing new
and related technologies, and the hiring and termination of executive
employees. Employee's duties and responsibilities shall be subject only to the
direction and authority of the Board. Unless Employee expressly consents to
the contrary, Employee shall hold the office of President and Chief Executive
Office of NMS, as well and along with any other wholly-owned subsidiary of
either the Company or NMS. The Board of the Company shall vote all of its
interest in favor of electing employee as President and Chief Executive
Officer of all such entities.
3. Full-time Employment. Employee agrees to devote his full-time services
and efforts and attention to the business and affairs of the Company.
Notwithstanding the foregoing, the Employee shall not be precluded from
engaging in other business activities, including, but not limited to, capital
raising activities or from serving on the board of directors of other
entities, whether it be a subsidiary of the Company or otherwise and receiving
additional compensation therefore, provided that any such other activities do
not in a material way substantially interfere with the Employee's
responsibilities with the Company.
4. Compensation: Bonuses.
A. In consideration for his services to be performed under this Agreement,
and as compensation therefore, Employee shall receive, in addition to all of
the benefits provided in this Agreement, a base salary (the "Base Salary"),
payable in semi-monthly installments, at a rate of One Hundred Twenty Thousand
Dollars ($120,000) per annum.
B. Employee shall be entitled to a bonus from time-to-time as may be
determined in the sole discretion of the Board of Directors.
C. Commencing as of January 1, 2000, and each succeeding year of the term,
the Base Salary shall be reviewed by the Board of the Company, at which time
the Base Salary hereunder (and any other benefits) may be increased (but not
decreased) by the Board in its sole discretion.
5. Benefits.
A. Stock Option. The Employee shall be granted an interest in a stock
option plan to be adopted by the Board (and approved by the shareholders as
applicable) to provide Employee the option to acquire 500,000 shares of common
voting stock of the Company, such Options having a five-year term, and with an
annual graduated step vesting over a five (5) year period, at an exercise
price equal to 110% of fair market value of the stock on the date of grant,
for all statutory or incentive stock options and having a exercise price equal
to the fair market value of the stock on the date of grant for all
nonstatutory stock options, The stock options shall have such other terms and
conditions as shall be agreeable to the parties hereto. Unless specifically
agreed to by the Employee, the options shall be nonqualified stock options.
B. Disability and Health Insurance. Subject to the terms and conditions of
Section 8. B. (related to disability), the Company shall provide a long-term
disability insurance policy for the Employee. In addition, the Company shall
also provide group health, hospitalization, major medical insurance and other
similar benefits for Employee as the Company has adopted or may hereafter
adopt for the benefit of its executives, officers and employees.
C. Vacation. During the term, Employee shall be entitled to three (3)
weeks of vacation annually.
D. Participation in Retirement and Employee Benefit Plans: Designation in
Management Bonus Plan. Employee shall participate in any plan of the Company
related to vacation, sick leave, stock options, stock purchase, stock grants,
pension, thrift, profit sharing, group life insurance, medical coverage,
education, early retirement or employee benefits that the Company has adopted
or may hereafter adopt for the benefit of its executives, officers and/or
employees. Further, in the event that the Company establishes a management
bonus plan, or similar benefit, or bonus program for executive employees that
creates a class distinction between executive employees (and other employees,
if applicable) the Company agrees that Employee shall always be designated as
a member of the class entitled to the greatest benefits. Similarly, during the
Term, Employee shall be entitled to receive other equity based compensation,
with respect to the Company and its subsidiaries (whether now existing or
hereafter created), the terms and conditions of which shall be subject to the
sole discretion of the Company's Board.
E. Expenses. The Company shall reimburse Employee for all reasonable
out-of-pocket expenses incurred by Employee in connection with the business of
the Company and in performance of his duties under this Agreement. Reasonable
out-of-pocket expenses shall include, without limitation, expenses incurred
for travel, hotels, meals, telephone (including cellular telephone),
facsimile, computer and other like expenses. Such expenses shall be promptly
reimbursed upon Employee's presentation to the Company of an itemized
accounting of such expenses with reasonable supporting data.
F. Life Insurance. The Company shall maintain a life insurance policy with
respect to Employee. Subject to the provisions of Section 8.C. below, the
Company shall maintain, at the Company's expense, a life insurance policy
naming Employee's spouse or any alternative beneficiary (or insurance trust
for the benefit of Employee's spouse or alternative beneficiary), the sole
beneficiary of an insurance policy paying $1 million upon the death of the
Employee (the "Employee's Life Insurance"). Employee shall cooperate with the
Company and submit such information and submit to such physical examinations
as may be reasonably required in order for the Company to obtain, at the
Company's cost and expense, such foregoing life insurance policy as well as
the long-term disability policy referred to in Section 5.13. above.
G. Additional Perquisites. Employee shall be entitled to an allowance of
$1,000 per month as an automobile allowance for the purchase or lease of an
automobile during the Term.
6. Term of Employment; Notice of Nonrenewal. The Term of this employment
shall commence on the date hereof for a period of three (3) years (the
"Term"), unless terminated prior thereto in accordance with Section 8 hereof.
Unless Employee and the Company renew or extend this Agreement in writing
prior to the end of the Term, upon terms and conditions satisfactory to each
of them, the Term of this Agreement shall automatically be extended for one
(1) additional year, upon the same terms and conditions set forth herein. The
Company shall provide Employee with written notice of the Company's intention
not to renew or extend this Agreement upon the terms and conditions at least
as favorable as those contained herein at least six (6) months prior to the
end of the Term (the "Nonrenewal Notice"). In the event that the Company shall
fail to render the Nonrenewal Notice at least six (6) months prior to the end
of the Term, the Term of this Agreement shall continue and accordingly,
Employee shall be entitled to the continuation of the Base Salary, bonus (at a
rate no less than that paid during the previous year), and all benefits under
Section 5 of this Agreement and otherwise (including expense allowance and
reimbursement), until such time as the Nonrenewal Notice is given and
thereafter, for a period of six (6) months from the date that the Company
actually renders and Employee actually receives the Nonrenewal Notice.
Regardless of when given, such Nonrenewal Notice shall also provide that at
the end of the six (6) month notice period or the Employee's termination date,
which ever is later, the Company shall pay Employee a lump sum equal to
Employee's base salary for the last twelve (12) months of the Term.
7. Confidentiality.
A. Employee agrees and covenants that, at any time during his employment
with the Company or thereafter, he will not, without first obtaining the
written permission of the Company, divulge to any person or entity, nor except
as necessary in accordance with his duties hereunder, use (either himself or
in connection with any business) any Confidential Information (as hereafter
defined) obtained during the course of his employment under this Agreement,
unless such disclosure is expressly authorized by the Company in writing, is
pursuant to a court order or other judicial process, required to be disclosed
in connection with the litigation involving the Company, or affiliate thereof,
or in any reports or applications required by law to be filed with any
governmental agency.
B. The term "Confidential Information" shall mean information disclosed to
Employee or known, learned, created or observed by him as a consequence of or
through his employment by the Company, or any Affiliate thereof, not generally
known in the public domain, about the business activities, services and
processes, including but not limited to information concerning methods of
doing business, marketing, advertising, promotion, publicity, research,
finances, accounting, trade secrets, business plans, customer lists and
records and potential customers of the Company and its subsidiaries. whether
developed or acquired by the Company.
Confidential Information shall also include information regarding third
parties received under confidentiality agreements by the Company or its
subsidiaries. All improvements, new products or new services derived from such
Confidential Information shall be the sole property of the Company.
Confidential Information shall not include any information that becomes
generally available to the public otherwise than through disclosure by
Employee. Upon termination of his employment hereunder, Employee agrees to
return to Employer all property of Employer of which Employee is in
possession, including any copies thereof, as well as all notebooks, and other
data relating to records, customers, investigations, or management studies or
inventions made by him.
C. Disclosure of Intellectual Property. Employee will fully and promptly
disclose to Employer all inventions, discoveries, know-how or improvements,
whether or not patentable and including works of authorship (hereinafter
"Intellectual Property") which Employee may conceive or make, alone or with
others, during the term of this Agreement whether or not during the working
hours (collectively "Term I/P"). Employee also will promptly disclose to
Employer all Intellectual Property which Employee may conceive or make, alone
or with others, within one (1) year after the Termination Date, which relates
to, or results from, or is suggested by: (1) activities of Employer, its
Affiliates, or licensees; (2) any proprietary information of Employer; or (3)
any work Employee may have done for Employer or any Affiliate (collectively
"Post-Term I/P").
D. Assignment of All Intellectual Property. The parties agree that All
Post-Term I/P and any Term I/P which meets the criteria for Post-Term I/P
described in clauses (1) through (3) of the last sentence of Section 7C. above
is the sole and exclusive property of Employer. Employee shall assign to
Employer or Employer's nominee all right, title and interest in and to any
such Intellectual Property, and Employee shall execute and deliver all
documents considered by Employer to be necessary or desirable to secure
patent, copyright or other legal protection in any country and to vest title
in Employer or Employer's nominee. By entering into this Agreement, Employer
does not waive and expressly retains its shop rights, works for hire, implied
licenses and other rights resulting from its employment of Employee.
8. Termination.
A. Cause. Notwithstanding the terms of this Agreement, the Company, by
action of a two-thirds (2/3) vote of the Board of Directors, may be written
notice to Employee, discharge Employee and terminate this Agreement for cause
("Cause") in the event that (i) Employee shall engage in an act of fraud, theft
or embezzlement in connection with his employment hereunder; (ii) Employee
engages in material gross misconduct that has a material adverse effect on the
Company; (iii) Employee engages in a material act of dishonesty; or (iv)
Employee shall be convicted of a felony involving a high degree of moral
turpitude, whether or not related to the performance of his duties hereunder.
Notwithstanding the foregoing to the contrary, prior to discharging Employee
pursuant to clause (ii) of the immediately preceding sentence, the Company
shall give Employee thirty (30) days' prior written notice of any breach or
failure and an opportunity to cure any such breach or failure. Employee shall
not, under any circumstances, be deemed to have been terminated for Cause
unless and until there shall have been delivered to him a copy of a resolution
duly adopted by the affirmative vote of not less than two-thirds (2/3) of the
Board of Directors (with Employee not being permitted to vote on this matter)
at a meeting of the Board of Directors held for that purpose (after thirty
(30) days notice to Employee and an opportunity for Employee, together with
counsel, to be heard before the Board) finding that in the reasonable, good
faith opinion of the Board, Employee was guilty of conduct constituting cause
and specifying the particulars thereof in detail. If there is any dispute as
to whether Employee's employment has been terminated with or without Cause,
Employee shall continue to receive all Base Salary, bonus (at a rate no less
than that paid in respect of the previous year), and benefits hereunder as if
there was no termination, unless and until it is finally determined that such
termination was for Cause, at which time all Base Salary, bonus and benefits
hereunder shall thereupon cease.
B. Incapacity or Disability. Should Employee become incapacitated or
disabled to the extent that, in the reasonable, good faith opinion of the
Board of Directors, Employee is unable to and does not substantially perform
his duties for a period of six (6) consecutive months, the Company may
terminate this Agreement upon three (3) months' prior notice, provided that
Employee does not return to his employment substantially in this full capacity
during such three (3) month period. In the event the Company does not maintain
the disability insurance referred to in Section 5.13. above and this Agreement
is terminated as a result of Employee's incapacity or disability, Employee
shall be entitled to receive his Base Salary and all benefits for a period of
twenty-four (24) months following termination of his employment due to
incapacity or disability.
C. Death. This Agreement shall terminate immediately upon the death of
Employee. In the event that Employee's Life Insurance is not in full force and
effect upon Employee's death, Employee's spouse, or any alternative
beneficiary, shall be entitled to receive promptly a payment equal to twelve
(12) months' Base Salary. Further, if Employee's Life Insurance is in full
force and effect upon Employee's death, but payment thereunder is not made
immediately to the beneficiary of such policy, the Company shall advance to
Employee's spouse, or any alternate beneficiary, commencing seven (7) days
after the date of Employee's death, 1/12 th of Employee's Base Salary, and
shall continue to advance 1/1 2t of Employee's Base Salary every thirty (30)
days thereafter for up to twelve payments (collectively, the "Interim Death
Payments") until such time as the proceeds payable pursuant to Employee's Life
Insurance Policy are paid to Employee's spouse or alternative beneficiary; it
being understood and agreed that any Interim Death Payments advanced by the
Company may, at the Company's discretion, be retained by the Company from the
proceeds of the Employee's Life Insurance.
D. Termination Without Cause; Good Reason. If employee is discharged and
this Agreement is terminated without Cause (Cause being defined as a reason
for termination set forth in Section 8.A. above) or by reason other than as
set forth in Section 8.B. or 8.C. hereof, or if Employee resigns for Good
Reason (as hereinafter defined) Employee shall receive upon any such
termination of, or resignation by, Employee: (A) a lump sum payment equal to
the product of 2.9 multiplied by the greater of (i) the Base Salary set forth
in Section 4 for the remainder of the Term as such sums become due or would
become due, or (ii) twelve (12) months (such period, to the extent it exceeds
the Term, being hereinafter sometimes referred to as the "Extended Period");
(B) a bonus based on the greater of the bonus paid in the last full calendar
year or 25% of the then current Base Salary whether or not there was a bonus
in the prior calendar year; (C) all benefits under Section 5 hereof for the
remaining Term or Extended Period, as applicable, and (D) any additional
amount that may be due pursuant to Section 8.E. below. In addition, any and
all options, warrants or other contractual rights to acquire equity securities
of the Company shall automatically vest and become exercisable, subject only
to restrictions pursuant to applicable securities law. For purposes of this
Agreement, "Good Reason" shall mean (i) a relocation of Employee, without his
prior written consent, outside of the Albuquerque area; or (ii) a failure to
maintain Employee as the President and Chief Executive Officer of the Board of
the Company or any subsidiary, or (iii) the failure to be nominated by
management of the Company for election to the Board, or (iv) a material
diminution by the Company of Employee's responsibilities, which change would
cause Employee's position with the Company or any subsidiary to become one of
significantly less responsibility, importance or scope from that contemplated
by Section 2 hereof, or (v) a willful failure in bad faith to pay the Base
Salary or bonus to Employee when due or another material breach of this
Agreement by the Company that has a material adverse effect on Employee, or
(vi) a Change of Control of the Company (as defined below). All amounts due
Employee under this Section 8 shall be paid to Employee without offset for
any amounts earned by Employee in any other employment or form any other
source. For purposes of this Agreement, a "Change of Control" of the Company
shall have occurred at such times as (a) beneficial ownership of more than
fifty percent (50%) of the voting securities of the Company is transferred
to a single entity or combined voting block or "group" as contemplated by,
or required to comply with the provisions of, Rule 13d-1(b)1(ii)(H),
promulgated under the Securities Exchange Act of 1934, as amended (or any
successor rule thereto), or (b) a merger, consolidation or sale of all or
substantially all the assets of the Company occurs.
E. Additional Amount. If in the opinion of tax counsel selected by Employee
and reasonably acceptable to the Company, Employee has or will receive any
compensation or recognize any income (whether or not pursuant to this
Agreement or any plan or other arrangement of the Company) which constitutes
an "excess parachute payment" within the meaning of Section 280G(b)(1) of the
Internal Revenue Code of 1986, as amended (the "Code") (or for which a tax is
otherwise payable under Section 4999 of the Code), then the Company shall pay
Employee an additional amount (the "Additional Amount") equal to the sum of
(i) all taxes payable by Employee under Section 4999 of the Code with respect
to all such excess parachute payments (other otherwise) and the Additional
Amount, plus (ii) all federal, state and local income taxes payable by
Employee with respect to the Additional Amount. The amounts payable pursuant
to this Section 8.E. shall be paid by the Company to Employee within 30 days
of the written request therefor made by Employee.
9. Noncompetition Covenants.
A. Covenant. Employee agrees that commencing as of the date hereof and for
a period of one (1) year following the termination of his employment with the
Company. Employee will not, directly or indirectly: (a) engage in or become
interested (whether as owner, principal, agent, stockholder, member, partner,
trustee, venturer, lender or other investor, director, officer, employee,
consultant or through the agency of any corporation, partnership, limited
liability company, association or agent or otherwise) in any business or
enterprise that shall then be in whole or in substantial part competitive with
the business conducted by the Company (or any other Affiliate thereof) (the
"Competitors"). Notwithstanding the foregoing, ownership of less than five
percent (5%) of the outstanding securities of any class of any entity listed
on a national securities exchange or traded in the over-the-counter market
shall not be considered a breach of this Section 9 if Employee (i) is not a
controlling person of or member of a group which controls such persons and
(ii) does not directly or indirectly, own five percent (5%) or more of any
class of securities of such person, or (b) solicit the employment of any
person who is then an employee of the Company (or any other subsidiary).
B. Exception. Employee may be relieved, in whole or in part, from complying
with Section 9A or 9B or both, (the "Noncompetition Agreement") by: (1) making
written application to Employer for an exception to the Noncompetition
Obligation stating clearly Employee's prospective employer, address, immediate
supervisor, duties and position with prospective or current employer; (2)
receiving a written exception from Employer; and (3) providing Employer, upon
its request, with a verification that Employee's duties and position with
Employee's new employer remain as stated in the written application previously
submitted to Employer. Employee's obligations to provide Employer with such
verifications will continue for all periods of Employee's employment by
Employee's employer during the term of the Noncompetition Obligation.
Employer's approval of such request shall not be unreasonably withheld.
C. Enforceability. In the event a court of competent jurisdiction determines
that the scope of restrictions or time or geographical limitations imposed are
too broad to be capable of enforcement, the limitations shall be modified, to
the least extent possible, so that the provisions are enforceable.
10. Violation of Other Agreements. Employee represents and warrants to the
Company that he is legally able to enter into this Agreement and accept
employment with the Company and that Employee is not prohibited by the terms
of any agreement, from entering into this Agreement; and the terms hereof will
not and do not violate or contravene the terms of any agreement to which
Employee is or may be a party, or by which Employee may be bound.
11. Notices. Any and all notices, demands or requests required or
permitted to be given under this Agreement shall be given in writing and sent
by registered or certified U.S. mail, return receipt requested, by hand or by
overnight courier, addressed to the parties hereto at their addresses set
forth above or such other address as they may from time-to-time designate by
written notice, given in accordance with the terms of this Section, together
with copies thereof as follows:
In the case of the Company, with copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ c/o ▇▇▇▇.▇▇▇., Inc. ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇. ▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
In the case of the Employee, with copy to:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Notices given as provided in this Section shall be deemed effective: (i) on
the date hand delivered, (ii) on the first business day following the sending
thereof by overnight courier, or (iii) on the seventh calendar day (or, if it
is not a business day, then the next succeeding business day thereafter) after
the depositing thereof into the exclusive custody of the U. S. Postal Service.
12. Waivers. No waiver by any party of any default with respect to any
provision, condition or requirement hereof shall be deemed to be a waiver of
any other provision, condition or requirement hereof; nor shall any delay or
omission of any party to exercise any right hereunder in any manner impair the
exercise of any such right accruing to it thereafter.
13. Preservation of Intent. Should any provision of this Agreement be
determined by a court having jurisdiction to be illegal or in conflict with
any laws of any state or jurisdiction or otherwise unenforceable, the Company
and Employee agree that such provision shall be modified to the extent legally
possible so that the intent of this Agreement may be legally carried out and
the provisions hereof may be enforced to the maximum extent possible.
14. Indemnification. Subject to the succeeding sentence, the Company shall
indemnify, defend and hold harmless Employee from and against all losses,
claims (whether actual or threatened), damages, liabilities, judgments, fines,
penalties, assessments and costs and expenses incurred (including, without
limitation, reasonable attorneys' fees and disbursements, including legal fees
and disbursements incurred to enforce this Agreement) arising prior to, on or
after the date hereof from the performance by Employee of his services
pursuant to this Agreement or Employee's prior service to the Company.
Notwithstanding the foregoing, Employee shall not be entitled to
indemnification pursuant to this Section 14 if a Court of competent
jurisdiction or an administrative body or agency determines that, in
connection with any matter giving rise to indemnification, Employee acted in
bad faith or dishonestly, or committed an act for illegal personal gain,
except as directed by the Board of Directors or a superior office (if any) had
reasonable cause to believe he violated any material law, committed an act for
illegal personal gain, except as directed by the Board of Directors or a
superior office (if any) had reasonable cause to believe he violated any
material law, committed an act of wanton or willful misconduct or gross
negligence or that Employee acted in a manner beyond the authorized scope of
his duties to be performed pursuant to this Agreement. The foregoing
indemnification shall be in addition to, and not in lieu of, the terms and
provisions of any indemnification agreement heretofore entered into by and
between the Company and Employee.
15. Preservation of Intent. Should any provision of this Agreement be
determined by a court having jurisdiction to be illegal or in conflict with
any laws of any state or jurisdiction or otherwise unenforceable, the Company
and Employee agree that such provision shall be modified to the least extent
possible so that the intent of this Agreement may be legally carried out and
the provisions hereof may be enforced to the maximum extent possible.
16. Dispute Resolution.
A. Generally. Subject to the provisions in Section 16B and C.,the purpose
and intent of the parties is to resolve their disputes expeditiously, and in
a financially reasonable manner; and further that the parties will meet
personally, and directly and in good faith to discuss how to proceed with
dispute resolution and with that purpose and intent in mind. Any dispute
between the parties to this Agreement or any other controversy or claim
arising out of or relating to this Agreement or the breach thereof shall be
submitted to and resolved by binding arbitration in Albuquerque, New Mexico.
Such arbitration shall be conducted upon the request of any party, before a
single arbitrator, selected by the parties or, failing agreement on a choice
of an arbitrator within thirty (30) days of service of written demand for
arbitration, by an arbitrator designated pursuant to the Uniform Arbitration
Act, NMSA 44-7-1 et set. (1978). Once the arbitrator is selected, but as a
condition precedent to proceeding with arbitration, the parties shall engage
on a good-faith best efforts basis (i) in direct face-to-face negotiations;
and failing resolution by negotiation, then (ii) mediation and, failing
mediation then, (iii) arbitration. Such arbitration shall be in accordance
with the laws of the State of New Mexico and pursuant to the Uniform
Arbitration Act, and subject to the Federal Rules of Civil Procedure as the
arbitrator may determine. The arbitration shall be conducted within sixty (60)
days of the selection of the arbitrator and the arbitrator shall render his or
her decision within twenty (20) days after conclusion of the arbitration. The
prevailing party in the arbitration shall be entitled as a part of the
arbitration award to the costs and expenses (including reasonable attorney
fees) of investigating, preparing and pursuing or defending the arbitration
claim as such costs and expenses are awarded by the arbitrator. The duty to
pursue the foregoing dispute resolution provisions, shall survive the
termination or cancellation of this Agreement. Arbitration pursuant to the
foregoing, shall be specifically enforceable under prevailing arbitration
laws of the State of New Mexico. The decision of the arbitrator shall be
final and binding upon the parties and enforceable in a court of competent
jurisdiction.
B. Injunctive Relief. Notwithstanding the foregoing, the parties recognize
that if there is a breach of either Section 7 or 9 hereof, that the general
dispute resolution provisions of this Section 16.A. may not be sufficient and
that extent of the damages to the Company or an Affiliate thereof, would be
impossible to ascertain and that there is and will be available to the Company
no adequate remedy at law in the event of such a breach. Consequently,
Employee agrees that in the event of a breach by Employee of Section 7, 9 or
both of them, in addition to any other relief to which the Company may be
entitled, the Company shall be entitled to enforce any or all of the
Employee's defaulted obligations hereunder, by injunctive or other equitable
relief ordered by any court of competent jurisdiction.
C. ERISA Rights. Notwithstanding the foregoing, if the claim involves a
right covered by the Employee Retirement Income Security Act of 1974 ("ERISA")
(e.g., severance pay pursuant to Section 6, 8 D and 8 E. above) then the
rights of the parties shall not be covered by either Section 16 A. or B. but
rather shall be covered by the ERISA Rights set forth as Exhibit A., attached
hereto and incorporated herein by reference.
17. Entire Agreement. This Agreement sets forth the entire and only
agreement or understanding between the parties relating to the subject matter
hereof and supersedes and cancels all previous agreements, negotiations
letters of intent, commitments and representations in respect thereof between
them, and no party shall be bound by any conditions, definitions, warranties
or representations with respect to the subject matter of this Agreement except
as provided in this Agreement.
18. Inurement; Assignment. In the event of a sale of the Company, or a
division, subsidiary or affiliate thereof, whether by way of stock sale, sale
of assets, merger or other business combination, as applicable, the rights and
obligations of the Company under this Agreement shall, with Employee's prior
written consent, inure to the benefit of and shall be binding upon any
successor of the Company or to the business of the Company, subject to the
provisions hereof. The Company may, with Employee's written consent, assign
this Agreement to any person, firm or corporation controlling, controlled by,
or under common control with the Company provided that, in the event of any
such assignment, the services to be rendered by the Employee to such assignee
shall be of the same nature and professional status provided for in this
Agreement. The Company's obligations hereunder shall be unaffected by any
assignment. Neither this Agreement nor any rights or obligations of Employee
hereunder shall be transferable or assignable by Employee.
19. Amendment. This Agreement may not be amended in any respect except by
an instrument in writing signed by the parties hereto.
20. Headings. The headings in this Agreement are solely for convenience of
reference and shall be given no effect in the construction or interpretation
of this Agreement.
21. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which when
taken together shall constitute one and the same instrument.
22. Governinq Law; Consent to Venue and Jurisdiction. This Agreement shall
be governed by, construed and enforced in accordance with the internal laws of
the State of New Mexico, without giving reference to principles of conflict of
laws. In the event of a dispute, each of the parties hereto irrevocably
consents to the exclusive venue and jurisdiction of the federal and state
courts located within the State of New Mexico, County of Bernalillo.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇.▇▇▇., INC.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇