EMPLOYMENT CONTRACT
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THIS is made as of 9th day of June, 2000.
BETWEEN:
FDPO INSURANCE (USA), INC., a corporation incorporated under
the laws of Delaware and having a principal place of
business at Suite 1005 - 750 West Pender Street, Vancouver,
British Columbia, V6C 2T8
(hereinafter referred to as the "Corporation")
OF THE FIRST PART
AND:
DAN KOVATCH, of 8939 S. Sepulveda Boulevard, Suite 262, Los
Angeles, CA 90045
(hereinafter referred to as the "Executive")
OF THE SECOND PART
WHEREAS the Executive and the Corporation wish to record the terms and
conditions upon which the Executive will be employed by the Corporation;
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the
mutual covenants contained herein, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the parties agree
as follows:
ARTICLE 1
GENERAL DEFINITIONS
1.1 As used in this Agreement, the following words shall have the following
meanings respectively:
(a) "Base Salary" has the meaning ascribed thereto in Section 4.1 hereof;
(b) "Board of Directors" means the Board of Directors of the Corporation;
(c) "Business" means any business venture involving or being concerned
with the placing of insurance;
(d) "Cause" has occurred if:
(i) the Executive fails to substantially perform his duties to the
Corporation after thirty (30) days notice of such failure;
(ii) the Executive engages in serious misconduct in the course of his
duties which is injurious to the Corporation or any of its
subsidiaries or affiliates;
(iii)the Executive is convicted with respect to a crime which
constitutes a felony offence;
(iv) in carrying out his duties hereunder, the Executive (i) is
wilfully or grossly negligent, or (ii) commits wilful and gross
misconduct or, (iii) fails to comply with an instruction or
directive from the Board of Directors and which is not cured
within fifteen (15) days;
(v) the Executive breaches a material term of this Agreement and
which is not cured within fifteen (15) days;
(vi) the Executive becomes bankrupt or a receiving order (or any
analogous order under any applicable law) is made against the
Executive or in the event the Executive makes any general
disposition or assignment for the benefit of his creditors;
(vii)the Executive is diagnosed as being afflicted by chronic
alcoholism or drug addiction; or
(viii) the occurring of any other circumstance which would entitle the
Corporation at law to terminate the Executive's services without
notice or payment in lieu of notice;
(e) "Commissions" means the commissions payable under Section 4.2 herein.
(f) "Effective Date" means the effective date of this agreement, being the
date first above written;
(g) "Parent" means "e-Financial Depot.com, Inc.";
(h) "person" means an individual body corporate, corporation, partnership,
syndicate or other form of unincorporated association, trust,
government and its agencies or instrumentalities, entity or group
whether or not having legal personality and any of the foregoing
acting in any derivative, representative or fiduciary capacity;
(i) "Term" has the meaning ascribed thereto in Section 3.1 hereof;
(j) "Termination Payment" has the meaning ascribed thereto in Section
5.1(b) hereof; and
(k) "Total Monthly Compensation" during any year of the Term means one
twelfth of the sum of the Base Salary for such year plus one twelfth
of the Commissions paid to the Executive in respect of the previous
calendar year.
ARTICLE 2
SERVICES
2.1 ENGAGEMENT. The Corporation hereby engages the Executive as
General Manager of the Corporation. During the Term the Executive will perform
the duties normally associated with the office of General Manager president in
accordance with the terms and conditions contained in this Agreement, and the
Executive hereby agrees to perform such services.
2.2 In the performance of his duties, the Executive shall comply with
applicable corporate legislation and the Corporation's constating documents and
provide to the Corporation his services on a full-time basis. The Executive
shall faithfully serve the Corporation and use his best efforts to promote the
interests of the Corporation during the Term of this Agreement.
2.3 REPORTING. The Executive shall comply with all lawful and
reasonable orders given to him by, and shall supply such information and reports
as from time to time may be requested of him, to the Board of Directors or any
person or committee designated by the Board of Directors.
ARTICLE 3
TERM OF AGREEMENT
3.1 TERM. The term of this Agreement (the "Term") shall commence on
the Effective Date and shall continue thereafter until terminated as provided
herein.
ARTICLE 4
REMUNERATION AND BENEFITS
4.1 BASE SALARY. For services rendered by the Executive during the
Term, the Executive shall be paid a salary, payable in equal monthly instalments
at the end of each month, at an annual rate of $60,000 (the "Base Salary").
4.2 COMMISSION. In addition to the Base Salary the Executive shall be
entitled to have control and direction over 20% of the commissions earned on
insurance placed by the Corporation in the United States in any one month, said
Commissions payable within 15 days of the end of such month to be paid to the
Executive and the salespersons of the Corporation in such proportions as the
Executive, in his sole discretion shall determine, provided that, in
circumstances where the Commissions earned are equal to or greater than 150% of
the Base Salary, as calculated monthly, for three consecutive months, the
Executive's entitlement hereunder to the Base Salary shall cease and then
Commissions shall form the sole source of the Executive's compensation
hereunder.
4.3 TAXES, ETC. All payments made to the Executive in connection with
his services hereunder shall be subject to, without limitation, all applicable
income and withholding taxes, if any, and other applicable deductions and taxes.
If for any reason any amount required to be withheld is not at the Executive's
request so withheld, the Executive agrees to reimburse and indemnify the
Corporation for any taxes, penalties or costs arising therefrom.
4.4 STOCK OPTIONS. The Executive shall be permitted to participate in
a stock option plan established by the Parent for its senior employees.
4.5 OTHER BENEFITS. The Executive shall be permitted to participate in
any non-salary benefit plans provided by the Corporation for its executives.
4.6 REIMBURSEMENT OF REASONABLE EXPENSES. The Executive will be
reimbursed for all reasonable expenses incurred by him in connection with the
conduct of the business of the Corporation. Such expenses shall be reimbursed
within thirty (30) days following presentation of sufficient evidence of such
expenditures, provided that the expenditures are consistent with the policies
and directives of the Board of Directors from time to time.
4.7 VACATION AND HOLIDAYS. The Executive shall be entitled to a number
of days paid vacation during each year of the Executive's employment hereunder
as is agreed from time to time between the Executive and the Corporation. Such
vacation shall be utilized by the Executive at such time or times as do not
materially interfere with the ongoing conduct of the Corporation's business and
operations.
ARTICLE 5
TERMINATION OF EMPLOYMENT
5.1 TERMINATION WITHOUT CAUSE. The Corporation shall be entitled to
terminate the Executive's employment at any time without Cause by:
(a) giving the Executive twelve (12) months notice; or
(b) paying the Executive a lump sum amount equal to twelve times the Total
Monthly Compensation in respect of the calendar year in which the
termination occurs (the "Termination Payment").
5.2 CONSEQUENCES OF TERMINATION WITHOUT CAUSE. In the event of
termination of the Executive's employment hereunder without Cause:
(a) the Executive shall be immediately relieved of all of his
responsibilities and authorities as an officer, director and employee
of the Corporation and, if applicable, of the Corporation's
subsidiaries and affiliates, effective as of the date of termination
of the Executive's employment fixed by the Corporation;
(b) subject as hereinafter provided, for a period of thirty (30) days
following the termination of the Executive's employment, the
Corporation shall continue benefits to the Executive and/or the
Executive's family under benefit plans equal to any which would have
been provided to the Executive and them if the Executive's employment
had not terminated; and
(c) subject to any required regulatory and shareholder approvals, all of
the stock options granted to the Executive by the Parent and
outstanding on the date of termination of the Executive's employment
shall be governed by the terms of the applicable stock option plan(s)
and stock option agreement(s).
5.3 TERMINATION FOR CAUSE. The Corporation shall be entitled to
terminate the Executive's employment at any time for Cause without notice and
without any payment in lieu of notice. In the event of a termination of the
Executive's employment for Cause, the Corporation's obligations hereunder shall
immediately cease and terminate and the Executive shall be immediately relieved
of all of his responsibilities and authorities as an officer, director and
employee of the Corporation and, if applicable, its subsidiaries and affiliates,
and in such an event there will be no continued salary payments by the
Corporation to the Executive and any rights and benefits of the Executive under
any employee benefit plans and programs of the Corporation will immediately
terminate in accordance with the terms of such plans and programs.
5.4 EFFECTIVE DATE OF TERMINATION FOR CAUSE. Termination of the
Executive's employment for Cause shall be effective upon the date of the notice
of termination given to the Executive and the lapse of any applicable cure
period without remedy of the matters set out in such notice.
5.5 DISABILITY, ETC. The Executive's employment shall terminate
automatically upon written notice from the Corporation in the event of the
Executive's absence or inability to render the services required hereunder due
to disability, illness, incapacity or otherwise for an aggregate of one hundred
eighty (180) days during any twelve (12) month period of the Term. In the event
of any such absence or inability, the Executive shall be entitled to receive the
compensation provided for herein for the first ninety (90) days thereof,
whereafter the Executive shall only be entitled to receive such compensation, if
any, as may be determined by the Board of Directors.
5.6 DEATH. In the event of the death of the Executive during the Term
of this Agreement, the Executive's salary will be paid to the Executive's spouse
through the end of the third month following the month in which the Executive's
death occurs. Rights and benefits of the Executive under employee benefit plans
and programs of the Corporation will be determined in accordance with the terms
and conditions of any such plans and programs.
5.7 OTHER POSITIONS. Upon termination of his employment for any reason
whatsoever, the Executive shall, at the request of the Corporation, forthwith
execute any and all documents appropriate to evidence resignations from all his
positions with the Corporation and its subsidiaries and affiliates. The
Executive shall not be entitled to any payments in respect of such resignations
in addition to those provided herein.
5.8 TAXES, ETC. All payments made to the Executive pursuant to this
Article 5 shall be subject to, without limitation, all applicable income and
withholding taxes, if any, and other applicable deductions and taxes.
5.9 RELEASE. The Executive agrees that the Termination Payment by the
Corporation as provided in this Article, as applicable, shall be a full and
final settlement of any and all manner of actions, causes of action, suits,
claims and demands whatsoever which he has or may have against the Corporation,
its affiliates or subsidiaries, and any of their directors, officers, employees
and their successors and assigns with respect to his employment.
5.10 CONFIDENTIALITY OF SETTLEMENT. The Executive agrees that any
settlement pursuant to this Article shall remain confidential as between the
Executive and the Corporation and shall not be disclosed by the Executive to any
person, corporation, group or organization whatsoever with the exception of the
Executive and his legal and financial advisors.
ARTICLE 6
CONFIDENTIAL INFORMATION
6.1 CONFIDENTIAL INFORMATION. The Executive hereby agrees to maintain
in confidence and not to disclose to any person, corporation, group or
organization whatsoever, during the Term and after his termination, any
information respecting the business affairs, prospects, operations, strategic
plans, data and trade secrets respecting the Corporation or its affiliates or
subsidiaries or any other confidential information gained in the course of the
services provided under this Agreement or otherwise, and not otherwise publicly
available or disclosed.
ARTICLE 7
NON-COMPETING AND NON-SOLICITATION COVENANTS
7.1 NON-COMPETITION. Notwithstanding termination of this Agreement,
whether or not for cause, the Executive shall not engage in any line of business
similar to the Business or engage in employment for any person, firm or
corporation engaged in the Business in the same or similar line of business
within the United States for a period of one (1) year from the time of
termination of this agreement, except as specifically approved in writing by the
Corporation in advance of such activities.
7.2 NON-SOLICITATION. For a period of three (3) years from the time of
termination of this agreement, the Executive shall refrain from interfering with
the employment arrangements between the Corporation or any of its affiliates or
subsidiaries and their employees and will not in any way solicit, recruit, hire,
assist others in recruiting or hiring, or discuss employment with any employees
of the Corporation of any of its affiliates or subsidiaries and shall refrain
from soliciting, contracting with, making presentations to or otherwise being
concerned with the customers of the Corporation or any of its affiliates or
subsidiaries.
ARTICLE 8
MISCELLANEOUS PROVISIONS
8.1 INDEPENDENT ADVICE. This Agreement was prepared by the
Corporation. The Executive has been asked to obtain independent legal advice
before signing this Agreement and the Executive represents by signing this
Agreement that he has either obtained such advice or waived such advice.
8.2 AMENDMENT AND WAIVER. No amendment, modification or waiver of any
provision of this Agreement or consent to any departure by the parties from any
provision of this Agreement is effective unless it is in writing and signed by
the parties and then the amendment, modification, waiver or consent is effective
only in the specific instance and for the specific purpose for which it is
given.
8.3 FURTHER ASSURANCES. The Executive and the Corporation shall do,
execute, acknowledge and deliver or cause to be done, executed, acknowledged and
delivered such further acts and documents as shall be reasonably required to
accomplish the intention of this Agreement.
8.4 APPLICABLE LAW AND JURISDICTION. This Agreement and all of the
rights and obligations arising herefrom shall be interpreted and applied in
accordance with the laws of Delaware and the courts of Delaware shall have
exclusive jurisdiction to determine all disputes relating to this Agreement and
all of the rights and obligations created hereby. The Executive and the
Corporation hereby irrevocably attorn to the jurisdiction of the courts of
Delaware.
8.5 PROHIBITIVE PROVISIONS. In the event that any provision or any
part of any provision hereof is deemed to be invalid by reason of the operation
of any law or by reason of the interpretation placed thereon by a court, this
Agreement shall be construed as not containing such provision or part of such
provision and the invalidity of such provision or such part shall not affect the
validity of any other provision or the remainder of such provision hereof. All
other provisions hereof which are otherwise lawful and valid shall remain in
full force and effect.
8.6 NOTICE PROVISIONS.
(a) Except as otherwise expressly provided herein, all notices shall be in
writing and either delivered personally or by registered or certified
mail, telegram or telecopier. In the case of the Corporation, notice
shall be delivered to the Chairman of the Board of Directors at the
Parent's head office. In the case of the Executive, notice shall be
delivered to the most current residence address of the Executive on
file with the Corporation.
(b) Any notice which is delivered personally shall be effective when
delivered and any notice which delivered by telecopier or telegram
shall be effective on the business day following the day of sending;
(c) Any notice given by telecopier or telegram shall immediately be
confirmed by registered or certified mail.
8.7 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties as to the matters dealt with herein. There are not and
shall not be any oral statements, representations, warranties, undertakings or
agreements between the parties. This Agreement may not be amended or modified
in any respect except in accordance with Section 8.2 herein.
8.8 BINDING EFFECT. This Agreement and all of its provisions shall
enure to the benefit of and be binding upon the parties, the successors and
assigns of the Corporation and the heirs, executors and personal representatives
of the Executive.
8.9 ASSIGNMENT. This Agreement may not be assigned by either party
without the prior consent in writing of the other, except that the Corporation
may assign this Agreement without such consent to any of its subsidiaries or
affiliates provided that it agrees to guarantee such assignee's obligations
hereunder.
IN WITNESS WHEREOF the parties hereto have caused this Agreement to be
executed and delivered as of the date first above written.
FDPO INSURANCE (USA), INC.
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Per: /s/ John Huguet
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Authorized Signatory
SIGNED, SEALED and DELIVERED by )
DAN KOVATCH in the presence of: )
)
/s/ Leona M. Odatey )
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Signature )
Leona M. Odatey ) /s/ Dan Kovatch
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Print Name ) DAN KOVATCH
8923 So. Sepuloeda Blvd )
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Address )
Los Angeles, CA 90045 )
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)
Notary Public )
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Occupation )