EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT ("Agreement") is made as of April 1, 2000, by
and between CHADMOORE WIRELESS GROUP, INC., a Colorado corporation (the
"Corporation"), and Stephen K. Radusch, an individual (the "Executive").
WHEREAS, the Corporation desires to employ Executive in the capacity of
Chief Financial Officer, and Executive desires to accept such employment on the
terms and conditions contained herein.
NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements hereinafter set forth, the parties hereto, intending to be legally
bound, agree to the following terms and conditions, which shall be effective
from and after the date hereof
1. RETENTION. TERM AND DUTIES
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1.1 Retention. The Corporation hereby employs the Executive as Chief
Financial Officer. and the Executive hereby accepts such employment, upon the
terms and subject to the conditions of this Agreement.
1.2 Term. The Term of employment of the Executive by the Corporation
shall be for the period commencing on January 4, 2000 (the "Commencement Date")
and ending on January 4, 2002 (the "Term"), unless this Agreement is sooner
terminated pursuant to Section 5 herein. Notwithstanding anything contained
herein to the contrary, the term of employment will be automatically extended
for successive one (1) year periods commencing January 4, 2002 ("Extended
Term"), unless either party to this Agreement elects to terminate this Agreement
by providing notice pursuant to Section 5 hereof of such election to the other
party during the sixty (60) day period commencing prior to the expiration of the
then applicable Term or Extended Term.
1.3 Duties. The Executive shall be the Chief Financial Officer of the
Corporation, with duties and responsibilities commensurate with such position,
and with the offer/acceptance letter between the parties dated December 16,
1999. The Executive shall report to the Corporation's President & CEO. The
Executive shall perform the duties regularly associated with this position at
the Corporation's corporate headquarters in Las Vegas, Nevada. Reasonable
modifications of the Executive's duties or work location may be made a condition
of the Executive's continued employment with the Corporation.
2. SCOPE OF SERVICES
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Services. The Executive agrees that he or she shall perform Executive's
services to the best of his/her ability. During the term of this Agreement the
Executive shall not render any services for others in any line of business in
which the Corporation or its subsidiaries are significantly engaged without
first obtaining the Corporation's written consent. Executive shall devote
his/her full business time, care, attention and best efforts to the
Corporation's business and shall conduct himself/herself in a manner so as to
reflect credit upon himself/herself and the Corporation.
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3. COMPENSATION
3.1 Base. The Corporation shall pay to the Executive an annual base
salary of One Hundred Thirty Five Thousand Dollars ($135,000) (the "Base
Salary"), payable in equal installments (in accordance with the Corporation's
standard practices, but no less often than semi-monthly) subject to all
withholding for income, FICA and other similar taxes, to the extent required by
applicable law. Salary for a portion of any period will be prorated. The
Corporation agrees to provide an annual written performance review of the
Executive by the Executive's direct supervisor, and to subsequently review the
then current Base Salary of the Executive. Said Base Salary may be increased by
the supervisor, subject to the concurrence of the Board of the Corporation or
the Compensation Committee, at the sole discretion of the Corporation.
3.2 Bonus. In addition to the Base Salary payable to the Executive
pursuant to Section 3.1 hereof, the Corporation (i) shall make available to the
Executive a bonus in the amount of $40,000 (Forty Thousand Dollars) based on
meeting performance standards or targets set reasonably and in good faith by the
President & CEO and as approved by the Board of Directors or the Compensation
Committee thereof, and (ii) may pay any additional amounts as, in the discretion
of the Board of the Corporation or the Compensation Committee, it may desire as
a result of the Executive's services. These amounts shall be referred to as
"Bonus".
3.3 Employee Stock Option Plan. In addition to the Base Salary payable
to the Executive pursuant to Section 3.1 hereof, and the Bonus payable to the
Executive pursuant Section 3.2 hereof, the Corporation shall issue to the
Executive Three Hundred Thousand (300,000) stock options, as approved by the
Board of Directors, in accordance with the Company's "Option Plan" and the
offer/acceptance letter between the parties dated December 16, 1999. The
Corporation may issue additional stock options, in the sole discretion of the
Corporation's Board of Directors or the Compensation Committee, it may desire as
a result of the Executive's services. The vesting, exercise, expiration and
other terms and conditions pertaining to these options shall be governed by the
offer/acceptance letter between the parties dated December 16, 1999 and in
accord with Corporation's Option Plan.
4. OTHER BENEFITS
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4.1 Insurance Benefits. The Executive shall be entitled to participate
in all other employee benefit programs of the Corporation in effect from time to
time, on the same availability and basis as other employees of a similar level
of employment as Executive, as determined at the sole discretion of the
Corporation or as required by applicable laws, subject to a determination of
eligibility under the terms of said plan in accordance with its respective
terms. The Corporation maintains the exclusive right, at its sole discretion, to
change, alter, modify, or eliminate any or all of said employee benefits at any
time consistent with other similarly situated executives of the Corporation.
Upon termination of Employment for any reason, the Executive may, at the
Executive's discretion, elect to acquire any desired benefit plans which are
convertible to the Executive in accordance with the terms and conditions of the
particular benefit plan(s), consistent with applicable Corporation policies, and
all federal, state, and local laws, including COBRA.
4.2 Expenses. The Corporation shall reimburse the Executive for all
reasonable and customary expenses which the Executive shall incur in connection
with the Executive's services to the Corporation or any subsidiary pursuant to
this Agreement. To obtain reimbursement, Executive shall comply with the
Corporation's reimbursement policies including documentation
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of expenses. All additional benefits are to be authorized by and subject to
approval by the Corporation's Board of Directors. Vacation; Sick Leave. The
Corporation shall provide to the Executive such paid vacation and paid sick
leave in accordance with the Corporation's AMTO policy as modified by the Board
of Directors or Corporation Committee (if any) for employees of a similar level
of employment as Executive. In accordance with the policies of the Corporation,
Executive may use vacation and sick leave, provided it does not materially
interfere with the Executive's performance of his/her obligations hereunder.
5. TERMINATION
This Agreement may be terminated by either party prior to the
Expiration Date only in accordance with the following provisions:
5.1 Death. In the event of the Executive's death, the Executive's
employment with the Corporation shall be deemed to be terminated as of the date
of death. Upon death, the Executive's estate or other legal representative shall
be entitled to receive any Base Salary accrued and unpaid at the time of death.
All other compensation or benefits shall cease at the date of death, except for
any prior vested benefits due the Executive under any benefit program of the
Corporation in which the Executive was enrolled, and such other benefits as may
be available to the spouse and/or dependents of the Executive in accordance with
the terms and conditions of the particular benefit plan(s), consistent with
applicable Corporation policies, and all federal, state, and local laws,
including COBRA.
5.2 Termination by the Corporation. Corporation may terminate the
Executive's employment hereunder, by delivering to the Executive a Notice of
Termination (defined hereinafter), as follows:
1) At will, without cause, with payment of twelve (12) months of
Base Salary as severance remuneration in equal bi-monthly or
semi-monthly installments to coincide with the Corporation's normal
payroll cycle. No other benefits except Base Salary will be paid or
will accrue or vest during this twelve (12) month installment severance
period. All Executive Options granted to Executive shall immediately
vest upon the date of termination at will, without cause.
2) For cause, at any time during employment, without any additional
remuneration or severance, with cause having any of the following
meanings:
(1) conviction of any felony or other crime involving moral
turpitude;
(2) the use of illegal drugs; the use of alcohol or abuse of
legal drugs which materially impairs the Executive's performance of
his or her duties;
(3) malfeasance or gross negligence by the Executive in the
performance of his or her duties;
(4) a material violation by the Executive of any provision of
this Agreement;
(5) willful or gross misconduct by the Executive injurious to
the Corporation.
5.3 Voluntary Termination. Executive may voluntarily terminate his or
her employment with the Corporation at any time, with a minimum of thirty (30)
days notice, by giving the Corporation a Notice of Termination (defined
hereinafter). If the Executive voluntarily terminates his or her Employment with
the Corporation under this Agreement, the
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Executive shall receive only the compensation and benefits accrued at the date
of termination. For salary, Executive will be paid salary accrued to the date of
termination, but no additional salary. For bonus, Executive will be paid bonus
amounts (if any) as determined in the sole discretion of the Board of Directors
or the Compensation Committee (if any). Stock options shall be governed by the
Company's Option Plan and the offer/acceptance letter between the parties dated
December 16, 1999. In the event Executive voluntarily terminates employment due
to inability of Corporation to meet payroll obligations for 31 consecutive days,
all employee stock options and/or stock appreciation rights granted to Executive
will vest at date of termination. Also, the Executive may elect to acquire or
assume any desired benefit plans which are convertible to the Executive, in
accordance with the terms and conditions of the benefit plan consistent with
applicable Corporation policies, and all applicable federal, state and local
laws, including COBRA.
5.4 Termination Following Change of Ownership. If this Agreement is
terminated by the Corporation's successor(s) or assignee(s), or executive is
required to relocate more than fifty (50) miles from Las Vegas, Nevada, or there
is a material reduction in the Executive's compensation, duties and/or
responsibilities within one year following a "change in the ownership" (as
defined below) of the Corporation, and in lieu of the benefits provided for in
Section 5.2(i), the Corporation shall pay to Employee a lump sum payment equal
to 2.99 times the average annual compensation paid by the Corporation and
includable by Employee in his gross income during the lesser of (i) the period
of time employed by the Corporation but shall not be not less than a multiple of
1 times the Executive's annualized base salary, including Executive's bonus per
Section 3.2 and any other compensation detailed in any preceding "offer letter"
executed by the Company and the Executive or (ii) the five tax years ended prior
to the tax year in which such change in ownership or control occurs, and all
Employee Stock Options shall immediately and irrevocably vest.. For purposes of
this Section 5.4, a "change in the ownership" of the Corporation will be deemed
to have occurred upon (i) completion of a transaction resulting in a
consolidation, merger, combination or other transaction in which the common
stock of the Corporation is exchanged for or changed into other stock or
securities, cash and/or any other property and the holders of the Corporation's
common stock immediately prior to completion of such transaction are not,
immediately following completion of such transaction, the owners of at least a
majority of the voting power of the surviving entity, (ii) a tender or exchange
offer by any person or entity other than Employee and/or his affiliates for
fifty percent (50%) of the outstanding shares of common stock of the Corporation
is successfully completed, (iii) the Corporation has sold all or substantially
all of the Corporation's assets or, (iv) during any period of twenty-four (24)
consecutive months, individuals who at the beginning of such period constituted
the board of directors of the Corporation (together with any new or replacement
directors whose election by the board of directors, or whose nomination for
election, was approved by a vote of at least a majority of the directors then
still in office who were either directors at the beginning of such period or
whose election or nomination for reelection was previously so approved) cease
for any reason to constitute a majority of the directors then in office.
Notwithstanding anything contained herein to the contrary, the payment by
Corporation to Employee pursuant to this Section 5.4 shall be reduced to the
extent necessary to prevent any portion of usch payment to be characterized as
an excess parachute payment under Section 280G of the Internal Revenue Code of
1986, as amended, or any successor provision thereof, which may be applicable to
a payment pursuant to this Section 5.4.
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5.5 Notice of Termination. For purposes of this Agreement, the term
"Notice of Termination" shall mean a written document delivered to the Executive
(if termination is by the Corporation) or to the Corporation (if a voluntary
termination by the Executive), which shall specify the section of this Agreement
under which the termination occurs. Termination shall be effective on the date
that the Notice of Termination is effective, or any date specified by the
Corporation (if termination is by the Corporation). Notwithstanding the
foregoing, the Notice of Termination shall be effective immediately upon
termination for "cause."
6. INDEMNIFICATION AND INSURANCE
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6.1 Obligation. The Corporation shall indemnity and hold harmless, and
in any action, suit or proceeding, defend the Executive (with the Executive
having the right to use counsel of his choice) against all expenses, costs,
liabilities and losses (including attorneys' fees, judgments and fines, and
amounts paid or to be paid in any settlement) (collectively, "Indemnified
Amounts") reasonably incurred or suffered by the Executive in connection with
the Executive's service as an employee of the Corporation or any affiliate to
the full extent permitted by the By-laws of the Corporation as in effect on the
date of this Agreement, or, if greater, as permitted by the general corporation
law of the jurisdiction of the Corporation's incorporation (the "GCL"), provided
that the indemnity afforded by the Corporation's By-laws shall never be greater
than permitted by the GCL. The Corporation shall advance on behalf of Executive
all Indemnified Amounts as they are incurred. To the extent a change in the GCL
(whether by statute or judicial decision) permits greater indemnification than
is now afforded by the By-laws and a corresponding amendment shall not be made
in said By-laws, it is the intent of the parties hereto that the Executive shall
enjoy the greater benefits so afforded by such change.
6.2 Determination. A determination that indemnification with respect to
any claims by the Executive pursuant to this Section 6 is proper shall be made
by independent legal counsel selected by he Board of Directors of the
Corporation and set forth in a written opinion furnished by such counsel to the
Board of Directors, the Corporation and the Executive. In the event it is
determined by such counsel that Executive is not entitled to indemnification
pursuant to this Section 6 (and if contested by Executive, such determination is
confirmed by the final non-appealable order of a court of competent
jurisdiction), or if a court of competent jurisdiction determines in a final
non-appealable order that Executive is not entitled to indemnification pursuant
to this Section 6, Executive shall promptly reimburse the Corporation for all
such advances of Indemnified Amounts made by the Corporation on Executive's
behalf.
6.3 Notice of Claims. The Executive shall advise promptly the
Corporation in writing of the institution of any action, suit or proceeding
which is or may be subject to this Section 6, provided that Executive's failure
to so advise the Corporation shall not affect the indemnification provided for
herein, except to the extent such failure has a material and adverse effect on
the Corporation's ability to defend such action, suit or proceeding.
6.4 Indemnification Insurance. The Executive shall be covered by
insurance, to the same extent as other employees of the Corporation are covered
by insurance, with respect to (a) directors and officers liability, (b) errors
and omissions, and (c) general liability insurance. The Corporation shall
maintain reasonable and customary insurance of the type specified in parts (b)
and (c) in the preceding sentence. The Executive shall be a named insured or
additional insured, without right of subrogation against him or her, under any
policies of insurance carried by the Corporation. The Corporation will, in good
faith, make efforts to maintain insurance coverage of
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the type specified in part (a) above at commercially reasonable rates, but the
failure to obtain such coverage shall not constitute a breach of the
Corporation's obligations hereunder.
7. CONFIDENTIAL INFORMATION: NONDISCLOSURE ETC.
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7.2 Confidentiality. During the Term, any Extended Term and thereafter
for a period of two (2) years, Executive shall keep secret and retain in
strictest confidence and shall not, without the prior written consent of the
Corporation, furnish, make available or disclose to any third party or use for
the benefit of himself or herself or any third party any Confidential
Information. Confidential Information is information related to or concerning
the Corporation and its businesses which is confidential, proprietary or not
generally known to and cannot be readily ascertained through proper means by
persons or entities (including any of the Corporation's present competitors),
who can gain any type of competitive advantage from its disclosure or use.
Confidential Information includes without limitation, all secret, confidential
or proprietary information, knowledge or data relating to the Corporation, such
as operational methods; financial data, marketing or development proposals,
plans or strategies; pricing strategies; business or property acquisition or
development proposals or plans; new personnel acquisition proposals or plans;
customer lists and any descriptions or data concerning current or prospective
customers; provided, however, while employed by the Corporation and in
furtherance of the business and for the benefit of the Corporation, Executive
may provide Confidential Information as appropriate to attorneys, accountants,
financial institutions and other persons or entities engaged in business with
the Corporation and authorized to receive such information in the ordinary
course of business.
7.3 Return of Documents. Promptly upon termination of this Agreement
for any reason, or whenever requested by the Board of Directors of the
Corporation, the Executive shall return or cause to be returned to the
Corporation all Confidential Information in any form or format, or any other
property of the Corporation in the Executive's possession or custody or at his
or her disposal, which he or she has obtained or been furnished, without
retaining any copies thereof.
8. NON-COMPETITION
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8.1 Restriction. Subject to Section 2 hereof, the Executive shall not,
(i) throughout the Term or Extended Term of this Agreement, as the case may be,
and (ii) for a period of 12 months thereafter, in each case without the
Corporation's prior written consent, render services to a business, or plan for
or organize a business, which is materially competitive with the Corporation or
of any of its subsidiaries by becoming an owner, officer, director, shareholder
(owning more than 4.9% of such business' equity interests), partner, associate,
employee, agent or representative or consultant or serve in any other capacity
in any such business.
8.2 Trade Secrets. Subject to Section 2 hereof, all ideas and
improvements which are protectable by patent or copyright, or as trade secrets
as defined in NRS 600A.030(4)(a) conceived or reduced to practice (actually or
constructively) during the Term or Extended Term of this Agreement by the
Executive, shall be the property of the Corporation; provided, however, that the
provisions of this Section 8.2 shall not apply to an invention for which no
equipment, supplies, facility or trade secret information of the Corporation was
used and which was developed entirely on the Executive's own time, and (a) which
does not relate to (i) the business of the Corporation or any of its
subsidiaries or (ii) the actual or demonstrably anticipated
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research or development by the Corporation of any of its subsidiaries (b) or
which does not result from any work performed by the Executive pursuant to this
Agreement.
9. REMEDIES
9.1 Arbitration. In the event of any dispute or controversy arising
under, out of or relating to this Agreement or the breach hereof other than
under Section 7 or 8 hereunder for which the Corporation may seek injunctive
relief, it shall be determined by arbitration in Las Vegas, Nevada to be heard
by a single arbitrator chosen by the Corporation and the Employee, provided that
if the Corporation and the Employee cannot agree on a single arbitrator, each
shall select one arbitrator and the arbitrators so selected shall select a third
arbitrator, and the panel of three arbitrators shall determine the dispute. Such
arbitration and any award made therein shall be binding upon the Corporation and
the Executive.
9.2 Injunctive Relief The Executive acknowledges and agrees that any
material breach which occurs or which is threatened of Section 7 or 8 hereof
shall cause substantial and irreparable damage to the Corporation in an amount
and of a character difficult to ascertain. Accordingly, in addition to any other
relief to which the Corporation may otherwise be entitled at law, in equity or
by statute, or under this Agreement, the Corporation shall also be entitled to
and Executive hereby consents to the issuance of an injunction preventing or
prohibiting such breach or threatened breach of Section 7 or 8 hereof.
9.3 Fees. If any action at law or in equity or arbitration is necessary
to enforce or interpret the terms and conditions of this Agreement, the
prevailing party shall be entitled to reasonable attorney's, accountant's and
expert's fees, costs and necessary disbursements in addition to any other relief
to which it or he or she may be entitled.
9.4 Reasonableness and Severabilitv of Executive Covenants. The
Executive acknowledges and agrees that the Executive's covenants under Sections
7 and 8 hereof are necessary for the protection of the Corporation's legitimate
interests, are reasonable and valid in duration and geographical scope, and in
all other respects. If any court determines that any of the Executive covenants
under Sections 7 and 8 hereof, or any part thereof, is invalid or unenforceable,
the remainder of them shall not thereby be affected and shall be given full
effect without regard to the invalid portions.
9.5 Blue-Penciling. If any court determines that any of the Executive's
covenants under Sections 7 and 8 hereof, or any part thereof, is unenforceable
because of the duration or geographical 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.
10. NOTICES
All notices required or permitted hereunder shall be in writing and
shall be delivered in person, by facsimile, telex or equivalent form of written
communication, or sent by certified or registered mail, return receipt
requested, postage prepaid, as follows:
To Corporation:
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Chadmoore Wireless Group, Inc.
2875 E. Patrick Lane, Suite G
Las Vegas, Nevada 89120
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Attention: President
Fax: 702-740-5646
To the Executive:
Stephen K. Radusch
930 Oak Parkway Drive
Houston, TX 77077
or such other party and/or address as either party may designate in a written
notice delivered to the other party in the manner provided herein. All notices
required or permitted hereunder shall be deemed duly given and received on the
date of delivery, if delivered in person or by facsimile, telex or other
equivalent written telecommunication, or on the seventh day next succeeding the
date of mailing if sent by certified or registered mail.
11. FURTHER ACTION
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The Corporation and the Executive each agrees to execute and deliver
such further documents as may be reasonably necessary by the other in order to
give effect to the intentions expressed in this Agreement.
12. HEADING; INTERPRETATIONS
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The headings and captions used in this Agreement are for convenience
only and shall not be construed in interpreting this Agreement.
13. ASSIGNABILITY
a) By Corporation. This Agreement is binding upon, and shall inure to
the benefit of the Corporation, and any successors or assigns, and may be
assigned in whole or in part by the Corporation, its successors and assigns.
b) By Executive. This Agreement is a personal services contract, and
the Executive may not assign his Agreement, or any part hereof, without the
prior, written consent of the Corporation, which consent may be withheld for any
reason.
14. ENTIRE AGREEMENT
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This Agreement contains the entire agreement and understanding of the
parties with respect to the matters herein, and supersedes all existing
negotiations, representations or agreements and all other oral, written and
other communications between them concerning the subject matter of this
Agreement, except in the event of change in control.
15. AMENDMENTS
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This Agreement may be amended or modified in whole or in part only by
an agreement in writing signed by the Corporation and the Executive.
16. WAIVER AND SEVERABILITY
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The waiver by either party of a breach of any terms or conditions of
this Agreement shall not operate or be construed as a waiver of any subsequent
breach by such party. In the event that one or more provisions of this Agreement
shall be declared to be invalid, illegal or unenforceable
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under any law, rule or regulation, such invalidity, illegality or
unenforceability shall not affect the validity, legality or enforceability of
the other provisions of this Agreement.
17. GOVERNING LAW
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This Agreement and the rights of the parties under it shall be governed
by and construed in accordance with laws of the State of Nevada, including all
matters of construction, validity, performance and enforcement and without
giving effect to the principles of conflict of laws, except that matters of
corporate law and governance shall be governed by and construed in accordance
with the laws of the State of Nevada.
18. COUNTERPARTS
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This Agreement may be executed in any number of counterparts, each of
which shall be an original, and all of which together shall constitute one and
the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
EXECUTIVE:
/s/ Stephen K. Radusch
---------------------------------
By:
Stephen K. Radusch, individually
CORPORATION:
Chadmoore Wireless Group, Inc.
/s/ Robert W. Moore
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BY:
Robert W. Moore, President/CEO
