Exhibit 10.2
RECLAMATION CONSULTING
AND APPLICATIONS INC.
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT (the "Agreement") is entered into as of June
11, 2007, by and between PAUL HUGHES ("Employee") and RECLAMATION CONSULTING AND
APPLICATIONS, INC., a Colorado Corporation with its principal place of business
at 940 Calle Amanecer Suite E, San Clemente, CA 92673 ("Company").
RECITALS
The company is in the business of manufacturing and marketing asphalt,
cement and related products release agents in liquid form that are non-toxic,
non-explosive and environmentally compatible, the formulation and ingredients of
which are confidential.
Employee has experience in the businesses conducted and to be conducted
by the Employer, or in related businesses, and desires to be employed by the
Company, and the Company desires to employ the Employee, on the terms and
conditions specified below
COVENANTS
In consideration of the recitals and mutual covenants contained herein,
the parties agree that:
1. EMPLOYMENT. The Company will employ Employee to serve as Chief
Operating Officer and Chief Financial Officer with the duties listed and defined
by the Company or the Board, in connection with the Company's operations and
Employee does hereby accept such employment, all subject to the terms and
provisions of this Agreement. Employee represents that he is legally free to
enter into this agreement and that it does not conflict with any of his duties
or obligations to any other person and that he is not in any way restricted by
any duties or obligations to any other person from contributing his knowledge
and talents to the Company in performing his duties hereunder.
2. TERM. This Agreement shall have an initial term of two years.
Thereafter, which the Agreement shall be automatically renewed for additional
one-year periods unless the Company notifies Employee of its intent not to renew
the Agreement at least 30 days prior to the expiration of the term.
Notwithstanding the foregoing, the Company or the Employee may at any time
terminate this Agreement and the employment relationship on or after June 11,
2008 with 30 days' notice to the other party, with the consequences hereinafter
set forth.
3. COMPENSATION.
(a) Base Salary. From June 11, 2007 to June 10, 2008, the
Company shall pay Employee an annual salary of
$135,200. On June 11, 2008, if the Company's net
profit equals or exceeds $250,000, then Employee's
annual salary shall be increased to $162,240.
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(b) Annual Bonus. In the event that the Company's net
profit equals or exceeds $250,000, Employee is
entitled to receive an annual bonus in an amount
equal to 10% of his annual salary. In addition,
Employee is entitled to receive an additional bonus
in an amount equal to 10% of his annual salary for
each additional $250,000 the Company earns in net
profit. Notwithstanding the foregoing, the total
amount of Employee's annual bonus shall not exceed an
amount that is 100% of Employee's annual salary.
(c) Stock Options. The Company shall issue Employee
options to purchase 2,000,000 shares of the Company's
restricted common stock at an exercise price of
$0.175. The options shall vest immediately upon
issuance and expire on June 10, 2012.
4. DUTIES. Employee agrees to devote his energies to the business of
the Company and agrees to perform such reasonable responsibilities and duties as
may be assigned to him from time to time by the Company or by the Company's
board of directors, which shall be consistent with his position as Chief
Operating Officer and Chief Financial Officer. In no event shall the Employee be
precluded from activities in professional societies, or from lecturing or
writing in areas of his professional expertise for reasonable periods, and
Employee shall be entitled to retain fees, honoraria, publication royalties and
similar compensation paid as a result of such activities.
5. ADDITIONAL BENEFITS. The Company agrees to reimburse Employee
promptly for or to pay on behalf of Employee, any reasonable expenses heretofore
or hereafter incurred by Employee (to the extent not paid by others) in the
furtherance of the goals of the Company upon submission of a satisfactory
accounting by Employee, and to provide Employee with the following additional
benefits:
(a) A minimum of three weeks annual paid vacation.
Vacation shall accrue on a monthly basis or part
thereof; however, once unused vacation has accrued to
a maximum of three weeks, accrual of additional
vacation shall cease until the balance of accrued
vacation has been reduced below six weeks. The
Company will not cause the vacation accrual to cease
by withholding its approval of any of the Employee's
vacation requests.
(b) Any other standard benefits that may be established
by the Company or its affiliates for its employees.
6. NON-DISCLOSURE OF CONFIDENTIAL INFORMATION. During the term of this
Agreement, Employee will have access to certain "Proprietary Information"
(defined below). Employee shall not during the term of his engagement, or at any
time thereafter, disclose any such Proprietary Information, directly or
indirectly, or use such Proprietary Information in any way, except as required
in the course of Employee's engagement with Company. All Proprietary
Information, which Employee shall prepare, use, or come into contact with, shall
be and remain the sole property of Company. For purposes of this Agreement,
"Proprietary Information" shall mean all information proprietary and
confidential to Company and shall include, but shall not be limited to,
confidential records, customer lists, customer leads or lead sources, files,
pricing information, marketing ads or strategies, equipment, quotation guides,
outstanding quotations, books, records, manuals, training materials, calling or
business cards, correspondence, files, contracts, orders, messages, memoranda,
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notes, circulars, agreements, bulletins, invoices, receipts, or any other
confidential papers or information concerning Company, its customers or
potential customers. Notwithstanding a termination of this Agreement or of
Employee's engagement with Company, the terms of this Section 6 shall survive
the termination of this Agreement and Employee's engagement with Company and
shall thereafter remain of full force and effect.
7. CONFIDENTIALITY AFTER TERMINATION OF EMPLOYMENT. Employee agrees
that upon termination of employment, he or she shall surrender promptly to the
Company any and all documents and property of the Company, including, but not
limited to reports, drawings, manuals, correspondence, customer lists and other
Confidential Information which he or she may possess, and all other materials
and all copies thereof relating in any way to the Company's business, or in any
way obtained by the Employee during the course of his employment, and that he
shall not retain any copies, notes or abstracts of the foregoing. Employee
further agrees that such documents, lists and information shall be and remain
the sole property of the Company. All of the terms of paragraph 2.8 shall remain
in full force and effect both during the continuation of employment of Employee
by the Company and after the termination of employment for any reason.
8. CONFIDENTIALITY. Employee agrees to execute standard Company
documents establishing the Employee's duties of confidentiality and the rights
of the Company to all inventions, trade secrets, etc., developed by the Employee
in the course of his employment, namely the EMPLOYEE NON-DISCLOSURE AND
NON-COMPETITION AGREEMENT.
9. NON-COMPETITION. Employee agrees that during the term of his
employment by Company, Employee will not engage in any way whatsoever, directly
or indirectly, in any business that is competitive with the Company and its
subsidiaries and affiliate operations, nor solicit or in any other manner work
for or assist any business which is competitive to the Company and its
subsidiaries and affiliate operations.
10. NON-PARTICIPATION IN COMPETITIVE ACTIVITIES. During the term of
this agreement, Employee will undertake no planning for or organization of any
business activity competitive with the work he performs as an Employee of the
Company and its subsidiaries and affiliate operations, and Employee will not
combine or participate with other employees of the Company and its subsidiaries
and affiliate operations for the purpose of organization of any such competitive
business activity.
11. ASSIGNMENT TO COMPANY OF PROPRIETARY RIGHTS. Employee agrees to
execute any and all documents and take any and all other actions necessary or
desirable for the assignment to the Company and its subsidiaries and affiliate
operations of all of his interests in any Confidential Information, trade
secrets, copyrightable materials and patentable or patented ideas developed by
him, alone or in conjunction with others, in the course of his employment by the
Company.
12. INJUNCTIVE RELIEF. The parties hereto agree and acknowledge that
many of the rights conveyed by this Agreement are of a unique and special nature
and that the Company and its subsidiaries and affiliate operations will not have
an adequate remedy at law in the event of failure of Employee to abide by its
terms and conditions, nor will money damages adequately compensate for such
injury. It is, therefore, agreed between the parties that in the event of breach
by Employee of Employee's covenants contained in this Agreement, the Company and
its subsidiaries and affiliate operations shall have the rights, among other
rights, to damages sustained thereby and to a preliminary or permanent
injunction to restrain Employee from the prohibited acts. Employee agrees that
this Paragraph shall survive for one year after the termination of his
employment, and Employee shall be bound by its terms for a period of one year
subsequent to the termination of his employment, providing that the Company and
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its subsidiaries and affiliate operations continue to conduct the same business
or businesses as they were conducting during the period of this Agreement.
Nothing herein contained shall in any way limit or exclude any and all other
rights granted by law or equity to the Company and its subsidiaries and
affiliate operations.
13. TERMINATION OF EMPLOYMENT. If Employee's employment terminates or
is terminated, the rights and obligations of the parties shall depend upon the
reason for termination. Termination may occur for any one of the following
reasons: termination by the Company for cause, termination by the Company
without cause, termination by Employee without cause, termination by Employee
with cause, or termination of Employee by reason of his death or long-term
disability.
(a) Termination by Company for Cause. In the event of
termination by the Company for cause, which shall
consist only of specific actions knowingly and
intentionally taken by Employee to the specific
material detriment of the Company and not reasonably
intended by him to benefit the company, the Employee
will receive all unpaid salary, bonuses, and other
benefits accrued through the last day of employment.
Employee agrees, if he is so terminated for cause,
that, for a period of one year following the
termination of employment of the Employee, Employee
will not engage in any way whatsoever, directly or
indirectly, in any business that is competitive with
the Company and its subsidiaries and affiliates
utilizing any Proprietary Information acquired while
organizing, founding, or acting as an officer,
director or employee of the Company, its subsidiaries
or affiliates, nor solicit customers, investors,
service providers, or strategic partners of the
Company, with the Company's, or its subsidiary's or
affiliates' business whether by interfering with or
raiding their employees, or disrupting or interfering
with their relationships with customers, investors,
service providers, or strategic partners. Employee
will have thirty days after termination by the
Company for cause to challenge the termination.
Employee may challenge the termination by the Company
for cause by sending written notice to that effect to
the Company via registered or certified mail,
postmarked no later than 30-days from the date that
employee received notice from the Company that
Employee was being terminated by the Company for
cause. The Company and Employee will each select an
arbitrator who will each review the facts surrounding
the termination and the challenge. The arbitrators
will decide whether the Company was justified in
terminating the Employee for cause. If the
arbitrators cannot agree whether the Company was
justified in terminating Employee for cause, the
arbitrators will select a third arbitrator who will
make the determination of whether the Company was
justified in terminating the Employee for cause. The
arbitration proceeding shall be conducted in
accordance with the provisions of California's
Arbitration act, Code of Civil Procedure, Sections
1280, et seq. The Company and Employee agree to abide
by the decision of the arbitration.
If the arbitrators agree or if the third arbitrator
determines, as applicable, that the Company was not
justified in terminating the Employee for cause,
within 72 hours of receiving the arbitration decision
that the termination by the Company for cause was not
justified, the Company will pay Employee back pay for
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all salaries and benefits from the date of
termination through the date of the arbitration
decision. The termination will then be treated as a
termination by the Company without cause, subject to
the provisions of subparagraphs
(b) TERMINATION BY COMPANY WITHOUT CAUSE. In the event of
that the Company terminates this Agreement on or
before June 10, 2008, Employee shall continue to
receive his annual salary as provided under Section
3(a) of this Agreement as though he had remained
employed through June 10, 2008, provided that he
executes and delivers a general release of claims in
a form acceptable to the Company and was not in
material breach of any provisions of this Agreement.
14. NOTICES. All notices, requests, demands and other communications to
be given hereunder shall be in writing and shall be deemed to have been duly
given on the date of personal service or transmission by fax if such
transmission is received during the normal business hours of the addressee, or
on the first business day after sending the same by overnight courier service or
by telegram, or on the third business day after mailing the same by first class
mail, or on the day of receipt if sent by certified or registered mail,
addressed as set forth below, or at such other address as any party may
hereafter indicate by notice delivered as set forth in this Section 14:
If to the Company: Reclamation Consulting &
Applications, Inc.
940 Calle Amanecer, Suite E
San Clemente, CA 92673
Attn: Mr. Gordon W. Davies
President
With a copy (which shall
not constitute notice) to: August Law Group, P.C.
The Atrium
19200 Von Karman Ave., Suite 900
Irvine, California 92612
Attn: Kenneth S. August, Esq.
President
If to Employee: Paul Hughes
7288 Beechwood Street, Vancouver,
Canada, V6P 5V4
15. BINDING AGREEMENT; ASSIGNMENT. This Agreement shall constitute the
binding agreement of the parties hereto, enforceable against each of them in
accordance with its terms. This Agreement shall inure to the benefit of each of
the parties hereto, and their respective successors and permitted assigns;
PROVIDED, however, that this Agreement may not be assigned (whether by contract
or by operation of law) by Employee without the prior written consent of the
Company.
16. ENTIRE AGREEMENT. This Agreement constitutes the entire and final
agreement and understanding between the parties with respect to the subject
matter hereof and the transactions contemplated hereby, and supersedes any and
all prior oral or written agreements, statements, representations, warranties or
understandings between the parties, all of which are merged herein and
superseded hereby.
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17. WAIVER. No waiver of any provision of this Agreement shall be
deemed to be or shall constitute a waiver of any other provision, whether or not
similar, nor shall any waiver constitute a continuing waiver. No waiver shall be
binding unless executed in writing by the party making the waiver.
18. HEADINGS. The headings provided herein are for convenience only and
shall have no force or effect upon the construction or interpretation of any
provision hereof.
19. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
20. FURTHER DOCUMENTS AND ACTS. Each party agrees to execute such other
and further documents and to perform such other and further acts as may be
reasonably necessary to carry out the purposes and provisions of this Agreement.
21. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of California applicable to the
performance and enforcement of contracts made within such state, without giving
effect to the law of conflicts of laws applied thereby. In the event that any
dispute shall occur between the parties arising out of or resulting from the
construction, interpretation, enforcement or any other aspect of this Agreement,
the parties hereby agree to accept the exclusive jurisdiction of the Courts of
the State of California. In the event either party shall be forced to bring any
legal action to protect or defend its rights hereunder, then the prevailing
party in such proceeding shall be entitled to reimbursement from the
non-prevailing party of all fees, costs and other expenses (including, without
limitation, the reasonable expenses of its attorneys) in bringing or defending
against such action.
22. SEVERABLE PROVISIONS. The provisions of this Agreement are
severable, and if any one or more provisions is determined to be illegal,
indefinite, invalid or otherwise unenforceable, in whole or in part, by any
court of competent jurisdiction, then the remaining provisions of this Agreement
and any partially unenforceable provisions to the extent enforceable in the
pertinent jurisdiction, shall continue in full force and effect and shall be
binding and enforceable on the parties.
EMPLOYEE
/S/ Paul Hughes
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Paul Hughes
RECLAMATION CONSULTING AND APPLICATIONS, INC.
/S/ Michael C. Davies
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By: Michael C. Davies
Its: Chief Executive Officer
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