EXHIBIT 10
EMPLOYMENT AGREEMENMT
RICHARD KOONTZ
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is made by and between USURF
America, Inc., a duly organized Nevada corporation ("Employer"), and Richard
Koontz a resident of the State of Colorado ("Employee").
W I T N E S S E T H:
WHEREAS, Employer is in need of persons with experience at the
executive level in developing the business operations of companies,
such as Employer;
WHEREAS, Employee has a substantial amount of the executive experience
needed by Employer; and
WHEREAS, Employee is willing to be employed by Employer, and Employer
is willing to employ Employee, on the terms, covenants and conditions
hereinafter set forth; and
WHEREAS, Employer and its affiliates have accumulated valuable and
confidential information, including, without limitation, trade secrets
and know-how relating to technology, equipment, marketing plans,
acquisition plans, sources of supply, business strategies and other
business records; and
WHEREAS, the giving of the covenants contained herein is a condition
precedent to the employment of Employee by Employer and Employee
acknowledges that the execution of this Agreement and the entering into
of these covenants is an express condition of his employment by
Employer and that said covenants are given in consideration for such
employment and the other benefits conferred upon him by this Agreement;
and
NOW, THEREFORE, in consideration of such employment and other valuable
consideration, the receipt and adequacy of which is hereby acknowledged,
Employer and Employee hereby agree as follows:
SECTION I. EMPLOYMENT OF EMPLOYEE
Employer hereby employs, engages and hires Employee as Executive Vice
President, Corporate Development of Employer, and Employee hereby accepts and
agrees to such hiring, engagement and employment, subject to the direct
supervision and direction of the CEO of Employer, as well as the general
supervision and pursuant to the orders, advice and direction of the Board of
Directors of Employer. Employee duties shall include, but not be limited to, the
duties and responsibilities as set forth on Exhibit "A" attached hereto, and
employee shall also include duties as are customarily performed by one holding
such position in other, same or similar businesses or enterprises as that
engaged in by Employer, and shall also additionally render such other and
unrelated services and duties as may be assigned to him from time to time by
Employer.
SECTION II. EMPLOYEE'S PERFORMANCE
Employee hereby agrees that he will, at all times, faithfully,
industriously and to the best of his ability, experience and talents, perform
all of the duties that may be required of and from him pursuant to the express
and implicit terms hereof, to the reasonable satisfaction of Employer.
SECTION III. COMPENSATION OF EMPLOYEE
Employer shall pay Employee, and Employee shall accept from Employer,
in full payment for Employee's services hereunder, compensation as follows:
A. Salary. Employee shall be paid as and for a salary the sum of
$12,500 per month, which salary shall be payable in equal
installments on the 1st and 15th days of each calendar month,
in arrears, subject to deduction of all lawful and required
withholding.
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B. Insurance and Other Benefits. As further consideration for the
covenants contained herein, Employer will provide Employee
with such insurance, welfare, sick leave and other benefits as
may be established by Employer from time to time with respect
to its employees in accordance with Employer's established
procedures. Employee shall be entitled to Directors' and
Officers' indemnification insurance coverage to the same
extent as is provided to other persons employed as officers of
Employer.
C. Other Compensation Plans. Employee shall be entitled to
participate, to the same extent as is provided to other
persons employed by Employer, in any future stock bonus plan,
stock option plan or employee stock ownership plan of
Employer.
D. Expenses. It is acknowledged that, during the term of
employment, Employee will be required to incur ordinary and
necessary business expenses on behalf of Employer in
connection with the performance of his duties hereunder.
Employer shall reimburse Employee promptly the amount of all
such expenses upon presentation of itemized vouchers or other
evidence of those expenditures. Any single expense item in
excess of $1,000.00 shall be approved by Employer prior to the
incurrence of such expense.
E. Car Allowance. Employee will receive a monthly car allowance
of $500.
F. Vacations. Employee shall be entitled to three (3) weeks paid
vacation each year for the term of this Agreement. Such
vacations shall be taken at such times as Employer designates
as to time-of-year. If applicable, vacation time can be
accumulated year-to-year up to three years maximum.
G. Warrants. Upon the signing of this Agreement Employee will be
granted 250,000 warrants priced at $.20, expiring 3 years from
the date of issuance. Additionally, Employee shall participate
in the proposed Management incentive plan as generally
described in Exhibit "B" attached hereto.
SECTION IV. COMPANY POLICIES
Employee agrees to abide by the policies, rules, regulations or usages
applicable to Employee as established by Employer from time to time and provided
to Employee in writing.
SECTION V. CONFIDENTIALITY AGREEMENT; NON-COMPETITION AGREEMENT
A. In consideration of Employer's executing this Agreement,
Employee shall have executed, prior to the execution of this
Agreement, a Confidentiality Agreement (the "Confidentiality
Agreement"), in the form attached hereto as Exhibit "A".
B. In consideration of Employer's executing this Agreement,
Employee agrees, effective as of the date hereof, to sign and
be bound by the obligations of an Agreement Not to Compete
(the "Non-Competition Agreement"), in the form attached hereto
as Exhibit "B".
C. The obligations under the Confidentiality Agreement and the
Non-Competition Agreement shall survive the termination of
this Agreement.
SECTION VI. TERM AND TERMINATION
A. Term. The term of this Agreement shall be a period of one
year, commencing on the date hereof. At the expiration date,
this Agreement shall be renewed for additional one-year
periods, provided neither party hereto submits a written
notice of termination within sixty (60) days prior to the
termination of either the initial term hereof or any renewal
term.
B. Termination. Employer agrees not to terminate this Agreement
except for "just cause", and agrees to give Employee written
notice of its belief that acts or events constituting "just
cause" exist. Employee has the right to cure, within thirty
(30) days of Employer's giving of such notice, the acts,
events or conditions which led to Employer's notice. For
purposes of this Agreement, "just cause" shall mean (1) the
willful failure or refusal of Employee to implement or follow
the written policies or directions of Employer's Board of
Directors, provided that Employee's failure or refusal is not
based upon Employee's belief in good faith, as expressed to
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Employer in writing, that the implementation thereof would be
unlawful; (2) conduct which is inconsistent with Employee's
position with Employer and which results in a material adverse
effect (financial or otherwise) or misappropriation of assets
of Employer; (3) conduct which violates the provisions
contained in the Confidentiality Agreement or the
Non-Competition Agreement; (4) the intentional causing of
material damage to Employer's physical property; and (5) any
act involving personal dishonesty or criminal conduct against
Employer.
Although Employer retains the right to terminate Employee for
any reason not specified above, Employer agrees that if it
discharges Employee for any reason other than just cause, as
is solely defined above, Employee will be entitled to full
compensation, including participation in all benefit programs,
for one year or the remainder of the current term, original or
renewal, as the case may be, of employment, whichever is less.
Employee should cease his employment hereunder voluntarily for
any reason, or is terminated for just cause, all compensation
and benefits payable to Employee shall thereupon, without any
further writing or act, cease, lapse and be terminated.
However, all defined compensation, benefits and reimbursements
which accrued prior to Employee's ceasing employment or
termination, will become immediately due and payable and shall
be payable to Employee's estate should his employment cease
due to death.
SECTION VII. COMPLETE AGREEMENT
This Agreement contains the complete agreement concerning the
employment arrangement between the parties hereto and shall, as of the effective
date hereof, supersede all other agreements between the parties. The parties
hereto stipulate that neither of them has made any representation with respect
to the subject matter of this Agreement or any representations including the
execution and delivery hereof, except such representations as are specifically
set forth herein and each of the parties hereto acknowledges that he or it has
relied on his or its own judgment in entering into this Agreement. The parties
hereto further acknowledge that any payments or representations that may have
heretofore been made by either of them to the other are of no effect and that
neither of them has relied thereon in connection with his or its dealings with
the other.
SECTION VIII. WAIVER; MODIFICATION
The waiver by either party of a breach or violation of any provision of
this Agreement shall not operate as, or be construed to be, a waiver of any
subsequent breach hereof. No waiver or modification of this Agreement or of any
covenant, condition or limitation herein contained shall be valid unless in
writing and duly executed by the party to be charged therewith and no evidence
of any waiver or modification shall be offered or received in evidence of any
proceeding or litigation between the parties hereto arising out of, or
affecting, this Agreement, or the rights or obligations of the parties
hereunder, unless such waiver or modification is in writing, duly executed as
aforesaid, and the parties further agree that the provisions of this Section IX
may not be waived except as herein set forth.
SECTION IX. SEVERABILITY
All agreements and covenants contained herein are severable, and in the
event any one of them, with the exception of those contained in Sections I, III,
IV and V hereof, shall be held to be invalid in any proceeding or litigation
between the parties, this Agreement shall be interpreted as if such invalid
agreements or covenants were not contained herein.
SECTION X. NOTICES
Any and all notices will be sufficient if furnished in writing, sent by
registered mail to his last known residence, in case of Employee, or, in case of
Employer, to its principal office address.
SECTION XI. CORPORATE AUTHORITY OF EMPLOYER
The execution of this Agreement by Employer has been approved by the
Executive Committee of the Board of Directors of Employer.
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SECTION XII. REPRESENTATIONS OF EMPLOYEE
A. Employee hereby represents to Employer that he is under no
legal disability with respect to his entering into this
Agreement.
B. Receipt of Disclosure. Employee hereby represents and warrants
that he has received and reviewed financial information
including (1) Employer's Annual Report on Form 10-KSB for the
year ended December 31, 2003, as filed with the SEC, (2)
Employer's Quarterly Reports on Form 10-QSB, as filed with the
SEC and (3) Employer's Current Reports on Form 8-K, as amended
and as filed with the SEC. With respect to such information,
Employee further represents and warrants that he has had an
opportunity to ask questions of, and to receive answers from,
the officers of Employer.
C. Representations Relating to Employer Common Stock. Employee
represents and warrants to Employer that the shares of
Employer common stock being acquired pursuant to this
Employment Agreement are being acquired for his own account
and for investment and not with a view to the public resale or
distribution of such shares and further acknowledges that the
shares being issued have not been registered under the
Securities Act or any state securities law and are "restricted
securities", as that term is defined in Rule 144 promulgated
by the SEC, and must be held indefinitely, unless they are
subsequently registered or an exemption from such registration
is available.
SECTION XIII. COUNTERPARTS
This Agreement may be executed in duplicate counterparts, each of which
shall be deemed an original and, together, shall constitute one and the same
agreement, with one counterpart being delivered to each party hereto.
SECTION XIV. BENEFIT
The provisions of this Agreement shall extend to the successors,
surviving corporations and assigns of Employer and to any purchaser of
substantially all of the assets and business of Employer. The term "Employer"
shall be deemed to include Employer, any joint venture, partnership, limited
liability company, corporation or other juridical entity, in which Employer
shall have an interest, financial or otherwise.
SECTION XV. ARBITRATION
The parties agree that any dispute arising between them related to this
Agreement or the performance hereof shall be submitted for resolution to the
American Arbitration Association for arbitration in the Denver, Colorado, office
of the Association under the then-current rules of arbitration. The Arbitrator
or Arbitrators shall have the authority to award to the prevailing party its
reasonable costs and attorneys fees. Any award of the Arbitrators may be entered
as a judgment in any court competent jurisdiction.
Notwithstanding the provisions contained in the foregoing paragraph,
the parties hereto agree that Employer may, at its election and without
delivering the notice to Employee required in Section VI(B) hereof, seek
injunctive or other equitable relief from a court of competent jurisdiction for
a violation or violations by Employee of the Confidentiality Agreement or the
Non-Competition Agreement.
SECTION XVI. LEGAL REPRESENTATION
Employer and Employee both acknowledge that each has utilized separate
legal counsel with respect to this Agreement. EMPLOYEE IS ADMONISHED TO SEEK HIS
OWN LEGAL COUNSEL.
SECTION XVII. GOVERNING LAW
It is the intention of the parties hereto that this Agreement and the
performance hereunder and all suits and special proceedings hereunder be
construed in accordance with and under and pursuant to the laws of the State of
Colorado, and that, in any action, special proceeding or other proceeding that
may be brought arising out of, in connection with or by reason of this
Agreement, the laws of the State of Colorado shall be applicable and shall
govern to the exclusion of the law of any other forum, without regard to the
jurisdiction in which any such action or special proceeding may be instituted.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the 30th day of June, 2004.
USURF AMERICA , INC.
By: /s/ Douglas O. McKinnon
-----------------------------
Douglas O. McKinnon
President and CEO
-------------------------------
Employee
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EXHIBIT A
SECTION 1
DUTIES AND RESPONSIBILITIES
The employee's duties and responsibilities are to include, but not limited to
the following:
o Financial oversight and accounting controls: Employee shall have sole
signing authority for all checks over $5,000 in the corporation and
its subsidiaries, and for authorizing all capital expenditures in
excess of $15,000 from funds provided through Atlas Capital. Employee
shall be responsible for the internal system of accounting controls
and the related reporting requirements of and compliance with the
Sarbanes-Oxley Act
o Public Reporting: Employee shall have responsibility for the areas
dealing with SEC reporting, Regulation FD disclosures and assist with
the process of applying for trading status on a major national
exchange (NASDAQ or AMEX) as well as assist in the determination of
the proper capital structure for the related exchange.
o Acquisitions: Employee shall be responsible for investigating and
evaluating all acquisitions, and preparing a recommendation for the
board on each. This recommendation will take into effect the impact a
candidate acquisition would have on ongoing operations, with special
emphasis on cash flows and marketing efforts. It will identify the
operational and marketing steps necessary to integrate, and amplify
the benefits of, any acquisition.
o Resource Forecasting (Financial and Personnel): Employee shall be
responsibility for the creation of a company-wide project plan
incorporating all major projects, marketing campaigns, acquisition
needs, and items involving either manpower resources or financial
outlays.
o Get-A-Phone: Employee shall act as Corporate Sponsor and liaison for
Get-A-Phone and shall provide assistance in establishing business
plan, targets, and related budgets as well as the implementation the
of the Texas and national rollout of their products.
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USURF America, Inc.
6005 Delmonico Drive, Suite 140
Colorado Springs, CO 80919
Re: Confidentiality Agreement
Gentlemen:
In connection with the execution of an employment agreement (the
"Employment Agreement") between the undersigned and USURF America, Inc.
(together with affiliates, the "Company"), the Company will furnish to the
undersigned certain information concerning its business, financial position,
operations, business contacts, assets and liabilities, as well as certain items
of equipment useful in the Wireless Internet access business. As a condition to
such information's being furnished to the undersigned and as a condition to the
undersigned's entering into an employment agreement with the Company, the
undersigned agrees to treat any information concerning the Company (whether
prepared by the Company, its advisors, or otherwise, and irrespective of the
form of communication) which is furnished to the undersigned now or in the
future by or on behalf of the Company (together with the material described
below, herein collectively referred to as the "Confidential Material") in
accordance with the provisions of this letter agreement, and to take or abstain
from taking certain other actions hereinafter set forth.
The undersigned understands that the term "Confidential Material" also
includes all notes, analysis, compilations, studies, interpretations or other
documents prepared by the Company or its representatives which contain, reflect
or are based upon, in whole or in part, the information furnished to the
undersigned. The term "Confidential Material" does not include information which
(A) is or becomes generally available to the public other than as a result of a
disclosure by the undersigned, or (B) was lawfully within the undersigned's
possession prior to its being furnished to the undersigned by or on behalf of
the Company, provided that the source of such information was not known by the
undersigned to be bound by a confidentiality agreement with, or other
contractual, legal or fiduciary obligation of confidentiality to, the Company or
any other party with respect to such information, or (C) is disclosed to the
undersigned by a third party, provided that such third party was not known by
the undersigned to be bound by a confidentiality agreement with, or other
contractual, legal or fiduciary obligation of confidentiality to, the Company or
any other party with respect to such information.
The undersigned hereby agrees that he will use the Confidential Material
solely in connection with the undersigned's performance of his duties under the
employment agreement, that the Confidential Material will be kept confidential
and that the undersigned will not disclose any of the Confidential Material in
any manner whatsoever.
The undersigned hereby agrees that he shall not reverse engineer, reverse
assemble or otherwise attempt to recreate or duplicate any model or working
model capable of performing the functions of any portion or all of the Company's
Wireless Internet access system included in the Confidential Material.
In the event that the undersigned is requested or required (by oral
questions, interrogatories, requests for information or documents in legal
proceedings, subpoena, civil investigative demand or other similar process) to
disclose any of the Confidential Material, the undersigned will provide the
Company with prompt written notice of any such request or requirement so that
the Company may seek a protective order or other appropriate remedy and/or waive
compliance with the provisions of this letter agreement. If, in the absence of a
protective order or other remedy or the receipt of a waiver by the Company, the
undersigned is, nonetheless, in the opinion of counsel, legally compelled to
disclose Confidential Material, the undersigned may, without liability
hereunder, disclose only that portion of the Confidential Material specifically
required by an order of Court. Additionally, the undersigned shall make every
reasonable effort and take every reasonable action, including, without
limitation, by cooperating with the Company, to obtain an appropriate protective
order or other reliable assurance that confidential treatment will be accorded
the Confidential Material.
Upon termination of the Employment Agreement or at any time upon the request of
the Company, the undersigned will promptly deliver to the Company or certify
destruction of, at the Company's direction, all Confidential Material (and all
copies thereof) furnished to the undersigned by or on behalf of the Company
pursuant hereto. All oral Confidential Material provided to the undersigned
shall continue to be held confidential hereunder. Notwithstanding the return or
destruction of the Confidential Material, the undersigned will continue to be
bound by obligations of confidentiality hereunder.
The undersigned agrees that the Company, without prejudice to any rights to
judicial relief he may otherwise have, shall be entitled to equitable relief,
including injunctive relief and specific performance, in the event of any breach
of the provisions of this letter agreement and that the undersigned will not
oppose the granting of such relief. The undersigned also agrees that he will not
seek and agrees to waive any requirement for the securing and posting of a bond
in connection with the Company's seeking or obtaining such relief. In the event
of litigation relating to this letter agreement, if a court of competent
jurisdiction determines that the undersigned has breached this letter agreement,
then the undersigned will be liable to pay to the Company the reasonable legal
fees incurred in connection with such litigation, including any appeal there
from. Also, in the event a court of competent jurisdiction determines that the
undersigned has not breached this letter agreement, then the Company will be
liable to pay to the undersigned the reasonable legal fees incurred in
connection with such litigation, including any appeal there from.
This letter agreement is for the benefit of the Company, and shall be construed
(both as to validity and performance) and enforced in accordance with, and
governed by, the laws of the State of Colorado applicable to agreements made and
to be performed wholly within such jurisdiction. This letter agreement shall
remain in full force and effect until the earlier of the date that is three
years from the termination of the undersigned's employment by the Company or the
date that this agreement is terminated by the Company.
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Please confirm your agreement with the foregoing by signing and returning one
copy of this letter to the undersigned whereupon this letter agreement shall
become a binding agreement.
- -------------------------------
Employee
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AGREEMENT NOT TO COM PETE
THIS AGREEMENT NOT TO COMPETE is entered into by and between USURF
America, Inc., a Nevada corporation ("Employer"), and Richard Koontz
("Employee").
WHEREAS, Employee is employed by Employer as Executive Vice President,
Corporate Development, pursuant to an employment agreement (the "Employment
Agreement"); and
WHEREAS, as a condition to such employment, Employee has agreed to sign
and be bound by this Agreement Not to Compete; and
NOW, THEREFORE, the parties agree as follows:
Section 1. Covenant Not to Compete. Employee acknowledges that, as a
key management employee of Employer, Employee will be involved, on a high level,
in the development, implementation and management of the national and
international business strategies and plans of Employer, which shall consist of
Employer and such other business units, divisions, subsidiaries or other
entities of Employer as Employer shall determine in its sole discretion from
time to time. By virtue of Employee's unique and sensitive position and special
background, employment of Employee by a competitor of Employer represents a
serious competitive danger to Employer, and the use of Employee's talent and
knowledge and information about Employer's business, strategies and plans can
and would constitute a valuable competitive advantage over Employer. In view of
the foregoing, Employee covenants and agrees that, if (i) Employee's employment
with Employer is terminated for just cause or (ii) if Employee voluntarily
resigns from his employment with Employer, then, for a period of one year after
the date of such termination, Employee will not engage or be engaged as, in any
capacity, directly or indirectly, including, but not limited to, employee,
agent, consultant, manager, executive, owner or stockholder (except as a passive
investor holding less than 5% equity interest in any enterprise the securities
of which are publicly traded) in any business entity engaged in competition with
any business conducted by Employer on the date of termination. Employee further
agrees that, if his employment shall cease pursuant to the change-in-control
provision of the Employment Agreement, then, for so long thereafter as Employee
shall receive compensation under the Employment Agreement, Employee shall not
engage in the activities prohibited by the preceding sentence. This Agreement
Not to Compete shall survive the termination or expiration of the Employment
Agreement. If any court determines that this Agreement Not to Compete, or any
part hereof, is unenforceable because the duration or geographic scope of such
provision, such court shall have the power to reduce the duration or scope of
such provision, as the case may be, and, in its reduced form, such provision
shall then be enforceable.
For purposes of this Agreement, "just cause" shall have the same
meaning as set forth in Section VII (B) of the Employment Agreement of even date
between the parties.
Section 2. Continuing Obligations. Employee agrees that, for one year
following (i) his termination of employment with Employer for just cause or (ii)
his resignation as an employee of Employer, Employee shall keep Employer
informed of the identification of Employee's employer and the nature of such
employment or of Employee's self-employment. Employer agrees that, within
fifteen days after receiving notice pursuant to this Section 2 of the
identification of the prospective employer, the nature of the employment or
self-employment or any change therein, Employer will advise Employee as to
whether such employment constitutes a violation of Section 1 hereof.
Section 3. Injunctive Relief. Employee acknowledges that the violation
of the covenants contained in this Agreement would be detrimental and cause
irreparable injury to Employer and its affiliates which could not be compensated
by money damages. Employee agrees that an injunction from a court of competent
jurisdiction is the appropriate remedy for these provisions, and consents to the
entry of an appropriate judgment enjoining Employee from violating these
provisions in the event there is a find of their breach.
Section 4. Severability of Covenants. Each of the covenants contained
in this Agreement are independent covenants, which may be available to or relied
upon by Employer and its affiliates in any court of competent jurisdiction. If
any one of the separate and independent covenants shall be deemed to be
unenforceable under the laws of any state of competent jurisdiction, each of the
remaining covenants shall not be affected thereby. Notwithstanding the
provisions of this Section 4, it is understood that every benefit received by
Employee by virtue of this Agreement is consideration for each separate covenant
contained herein.
Section 5. Governing Law. This Agreement shall be governed by the laws
of the State of Colorado.
Section 6. Other Remedies. The undertakings herein shall not be
construed as any limitation upon the remedies Employer might, in the absence of
this Agreement, have at law or in equity.
INTENDING to be legally bound hereby, Employer and Employee hereby duly
execute this Agreement Not to Compete as of the date indicated below.
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USURF AMERICA, INC.
/s/ Douglas O. McKinnon
-------------------------------
Date: June ____, 2004 Douglas O. McKinnon
President and CEO
----------------------------
Employee
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