SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT INFORMATION
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) July 9, 1998
QuikBIZ Internet Group, Inc.
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(Exact name of registrant as specified in its charter)
Nevada 0-25276 88-0320364
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
5310 NW 33rd Avenue, Suite 212, Ft. Lauderdale, FL 33309
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (954)739-7005
Algorhythm Technologies Corporation
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(Former name or former address, if changed since last report.)
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2. Acquisition or Disposition of Assets.
On July 9, 1998, the acquisition by the Registrant of QuikLAB
Multimedia Centers, Inc. ("QLab"), a Florida corporation was completed. QLab is
in the business of providing internet and multimedia services and has been in
business since 1991 and is located in Ft. Lauderdale, FL. QLab provides services
in the development of internet and intranet sites, CD-ROM based programs, video
and audio production, interactive kiosks, video and audio encoding, animation,
video/audio/ CD duplication, and media package design.
David Bawarsky, the Registrant's CEO, Secretary, director and
controlling shareholder, was the owner of QLab. The stock of QLab was acquired
by the Registrant in consideration of the issuing to David Bawarsky stock
options to acquire 200,000 shares of the Registrant, at a price of $.002 per
share. The options are for two years and the underlying shares are to be
registered on Form S-8. In addition, if QLab doubles its net revenue within
three years, the Registrant has agreed to issue a total of 2,800,000 stock
options exercisable at $.002 per share to David Bawarsky. The options will be
for a period of 3 years. Mr. Bawarsky will be the President and CEO of QLab and
he and Andrew Smith, the Registrant's President, will be the directors of QLab.
The financial statements will be filed within 60 days from the date of
the filing of this report. There was no change in control of the Registrant as a
result of the acquisition.
A five year employment agreement between David Bawarsky and QLab, dated
June 16, 1998, provides that Mr. Bawarsky is to receive: a salary of $175,000
per year which is to be increased by 20% per year commencing with January 1,
1999; an annual non-accountable expense account of $25,000, in addition to being
entitled to reimbursement of necessary, customary and usual expenses incurred by
him on behalf of QLab; a Performance Incentive Bonus, based upon net profits;
two motor vehicles (Lexus 400) for himself and his spouse, or at Mr. Bawarsky's
option the financial equivalent. QLab is to pay for the insurance and all
maintenance on the motor vehicles. As part of the acquisition agreement, the
Registrant has approved and guaranteed the employment agreement, and has agreed
to give Mr. Bawarsky the option to take a maximum of $50,000 of his gross annual
compensation in the form of common stock of the Registrant, on a pro rata
quarterly basis. The shares will valued at the bid price of the Registrant's
common stock at the end of the quarter.
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7. Financial Statements and Exhibits.
c. Exhibit 2.3: Acquisition Agreement between QuikBIZ Internet
Group, Inc. and QuikLAB Multimedia Centers, Inc., dated June 25, 1998.
Exhibit 10.5: Employment Agreement between QuikLAB Multimedia
Centers, Inc. and David Bawarsky, dated June 16, 1998.
Pursuant to the requirements of the Securities Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
QUIKBIZ INTERNET GROUP, INC.
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REGISTRANT
Dated: July 23, 1998 /s/Andrew Smith
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ANDREW SMITH, President
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ACQUISITION AGREEMENT
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THIS ACQUISITION AGREEMENT wherein the participants are QUIKBIZ
INTERNET GROUP, INC., a Nevada corporation ("QBIZ") f/k/a ALGORHYTHM
TECHNOLOGIES CORP. and QUIKLAB MULTIMEDIA CENTERS, INC., a Florida
corporation ("QLAB").
W I T N E S S E T H:
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WHEREAS, QBIZ a) is a Nevada corporation in good standing which is
currently a publicly traded SEC reporting company (f/k/a Algorhythm Technologies
Corp.), traded on the OTC bulletin board under the symbol, QBIZ (f/k/a ALGR);
and b) QBIZ is a holding company which includes or will include in this holdings
other corporate entities such as QLAB, and c) has 12,535,240 shares issued and
outstanding as of May 29, 1998; and
WHEREAS, QLAB a) is a Florida corporation in good standing and is in
the business of creating and providing multimedia products and services to
parties such as QBIZ; and b) has 500,000 authorized shares, of which 500,000
shares have been issued; and
WHEREAS, The Board of Directors of QBIZ and the Board of Directors of
QLAB deem it advisable that QBIZ acquire QLAB as a wholly owned subsidiary of
QBIZ with certain principals of QLAB continuing on to head up operations for
QLAB for a period of time, subject to employment agreements and other
conditions; and
WHEREAS, QLAB shall perform certain services for QBIZ; and
WHEREAS, QBIZ has furnished or will furnish QLAB, within thirty (30)
days of the execution of this Agreement, with a copy of its 10-K submission for
the year of 1997. It is understood that this Agreement shall not be binding upon
QLAB until said 10-K has been submitted for the year 1997. This submission, to
the extent required, (i) shall be in accordance with the books and records of
QBIZ (ii) do and shall fairly represent the financial condition of QBIZ as of
those dates and the results of its operations as of and for the periods
specified, all prepared in accordance with generally accepted accounting
principles; and (iii) do and shall contain and reflect, in accordance with
generally accepted accounting principals consistently applied, reserves for all
liabilities, losses and costs in excess of expected receipts and all discounts
and refunds for services and products already rendered or sold that are
reasonably
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anticipated and based on events or circumstances in existence or likely to occur
in the future with respect to any of the contracts or commitments of QBIZ.
Specifically, but not by way of limitation, if customary, the submissions shall
disclose, in accordance with generally accepted accounting principles, all of
the debts, liabilities, and obligations of any nature (whether absolute,
accrued, contingent or otherwise, and whether due or to become due) of QBIZ at
the Balance Sheet Date, and shall include appropriate reserve for all taxes and
other liabilities accrued or due at that date but not yet payable; and
WHEREAS, QLAB has furnished or will furnish QBIZ with a copy of its
audited financial statements of QLAB for the years 1996 and 1997 and the related
statement of income for the first three months of 1998 within 60 days from date
of this agreement. These financial statements (i) are and shall be in accordance
with the books and records of QLAB; (ii) do and shall fairly represent the
financial condition of QLAB as of those dates and the results of its operations
as of and for the periods specified, all prepared in accordance with generally
accepted accounting principles; (iii) do and shall contain and reflect, in
accordance with generally accepted accounting principles consistently applied,
reserves for all liabilities losses and costs in excess of expected receipts and
all discounts and refunds for services and products already rendered or sold
that are reasonably anticipated and based on events or circumstances in
existence or likely to occur in the future with respect to any of the contracts
or commitments of QLAB, and shall be warranted as true and correct by the
hereinafter named principals of QLAB. Specifically, but not by way of
limitation, the Balance Sheet shall disclose, in accordance with generally
accepted accounting principals, all of the debts, liabilities, and obligations
of any nature (whether absolute, accrued, contingent or otherwise, and whether
due or to become due) of QLAB at the Balance Sheet Date, and shall include
appropriate reserves for all taxes and other liabilities accrued or due at that
date but not yet payable; and
WHEREAS, all required federal, state and local tax returns of QBIZ and
QLAB have been accurately prepared and filed, and all federal, state and local
taxes required to be paid with respect to the periods covered by the returns
have been paid including, but not limited to, income, employment, property,
franchise and sales tax. QBIZ and QLAB have not been delinquent in the payment
of any tax or assessment; and
WHEREAS, all named parties represent unto the other that they have
authority to enter in to this Agreement; and
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WHEREAS, neither corporate entity is a party to any pending or
threatened litigation and/or legal action; and
WHEREAS, neither party has consulted with a broker or a finder in
arranging the instant transaction.
NOW THEREFORE, based upon the statements made hereinabove and the
covenants and conditions set forth hereinbelow, the parties agree and
acknowledge as follows:
1. All of the above statements are true and correct.
2. The parties shall cause the following to simultaneously occur
with the execution of this Agreement:
(A) All of the stockholders of QLAB shall surrender their
shares to the Secretary of QLAB, resulting in there being
500,000 shares in the treasury of QLAB.
(B) Intentionally omitted
(C) QBIZ shall acquire all of the QLAB authorized shares
and QBIZ shall own 100% of the stock of QLAB.
(D) Upon signing of this Agreement, QBIZ will
adopt the employment agreement between QLAB,
and DAVID BAWARSKY ("BAWARSKY") as its own
employment agreement between the parties,
subject to all the terms and conditions
therein and will guarantee the terms
therein. Additionally, QBIZ will provide
BAWARSKY the following as additional
compensation:
(i) If, within a three year timetable
commencing the execution of said
employment agreement, QLAB doubles its
net revenue, QBIZ will issue a total of
2,800,000 options [on a one time basis]
of restricted common stock, at a price
of $.002 per share to BAWARSKY, these
options will be for a period of five
years;
(ii) BAWARSKY's option, a maximum of $50,000
of his gross annual compensation
under said employment agreement may be
taken in the form of equity of QBIZ on a
pro rata quarterly basis at
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the purchase rate equivalent to the bid
price of QBIZ at the end of said
quarter.
(iii) QBIZ will also issue a total of 200,000
options (on a one time basis) of common
S-8 stock, at $.002 per share to
BAWARSKY, within 5 working days from the
date of execution of this Agreement;
these options will be for a period of
two years; and
(iv) BAWARSKY shall serve as CEO and Chairman
of the Board of QBIZ for a minimum of 5
years.
(E) QLAB shall have its own Board of Directors, consisting of
two directors, with BAWARSKY being Chairman and CEO and
Andy Smith as Director.
(F) QBIZ will cause QLAB, as a wholly owned subsidiary of
QBIZ, to enter into an employment agreement with three
(and perhaps fours, total) of its principals, to be named
by BAWARSKY, to receive an employment agreement with an
option package of 120,000 shares of QBIZ common stock, at
$.002 per share within 3 days from date of this agreement
and provide an additional option package of 80,000 shares
of QBIZ common stock, at $.002 per share, subject to each
said principal remaining continuously employed with QLAB
for a period of one year from the execution of this
agreement, with such employment agreement shall be
otherwise in form as approved by the attorney for QBIZ.
3. The parties recognize that all of the statements made
herein by each party are made as material inducements to the
other party to execute this Agreement and perform obligations
under this Agreement.
1. Pending consummation of all of the obligations under this
Agreement, QBIZ and QLAB will carry on their business in
substantially the same manner as before and each will use its
best efforts to maintain its business organization intact, to
retain its present employees, and to maintain its
relationships with suppliers and other business contacts.
Except with the prior consent in writing of QBIZ, pending
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consummation of the obligations under this Agreement, QLAB
shall not:
(A) Declare, pay and dividend or make any other
distribution on its shares.
(B) Create or issue any indebtedness for borrowed money.
(C) Enter into any transaction other than those involved
in carrying on its ordinary course of business.
5. Except as may be expressly waived in writing by QLAB, all of
the obligations of QLAB under this Agreement are subject to
the satisfaction, prior to or on the closing/completion of
obligations, of each of the following conditions by QBIZ:
(A) The representations and warranties made by QBIZ to
QLAB herein and in any document delivered pursuant to this
Agreement shall be deemed to have been made again at the
time of the exchange and shall then be true and correct in
all material respects. If QBIZ shall have discovered any
material error, misstatement or omission in those
representations and warranties on or before closing, it
shall report that discovery immediately to QLAB and shall
either correct the error, misstatement, or omission or
obtain a written waiver from QLAB. The parties agree to
resolve any dispute regarding material error, misstatement
or omission through arbitration following the Rules of the
American Arbitration Association. The results of such
arbitration shall be binding upon the parties.
(B) QBIZ shall have performed and complied with all agreements
and conditions required by this Agreement to be performed
and complied with by it prior to or at closing.
(C) No action or proceeding by any governmental body or agency
shall have been threatened, asserted, or instituted to
restrain or prohibit the carrying out of the transactions
contemplated by this Agreement.
(D) All corporate and other proceedings and action taken in
connection with the transactions contemplated by this
Agreement and all certificates, opinions, agreements,
instruments, and documents shall be satisfactory in form
and substance to counsel for QLAB.
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6. Except as may be expressly waived in writing by QBIZ, all of
the obligations of QBIZ under this Agreement are subject to
the satisfaction, prior to or on the closing/completion of
obligations, of each of the following conditions by QLAB:
(A) The representations and warranties made by QLAB to
QBIZ herein and in any document delivered pursuant to this
Agreement shall be deemed to have been made again at the
time of the exchange and shall then be true and correct in
all material respects. If QLAB shall have discovered any
material error, misstatement or omission in those
representations and warranties on or before closing, it
shall report that discovery immediately to QBIZ and shall
either correct the error, misstatement, or omission or
obtain a written waiver from QBIZ. The parties agree to
resolve any dispute regarding material error, misstatement
or omission through arbitration following the Rules of the
American Arbitration Association. The results of such
arbitration shall be binding upon the parties.
(B) QLAB shall have performed and complied with all agreements
and conditions required by this Agreement to be performed
and complied with by it prior to or at closing.
(C) No action or proceeding by any governmental body or agency
shall have been threatened, asserted, or instituted to
restrain or prohibit the carrying out of the transaction
contemplated by this Agreement.
(D) All corporate and other proceedings and action taken in
connection with the transactions contemplated by this
Agreement and all certificates, opinions, agreements,
instruments, and documents shall be satisfactory in form
and substance to counsel for QBIZ.
(E) QBIZ shall have received (and approved for its purposes in
completing the proposed acquisition) all documentation as
described in this agreement from QLAB. Notwithstanding
anything stated to the contrary herein, the parties
understand and acknowledge that a line of credit and
long-term debt for QLAB exists at the time of this
acquisition. It is the understanding and
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agreement of QLAB and QBIZ that the parties shall
terminate and close QLAB's lines of credit no later than
sixty (60) days after the closing of this transaction.
After the date of this transaction, all of the net profits
and dividends of QLAB shall be applied first to the
payment of the credit line and other long-term debt until
paid in full, as determined by QLAB. Further, subject to
QLAB generating sufficient profits to retire this debt,
QBIZ shall indemnify QLAB and be responsible to and for
all claims related to said credit line account and other
long-term debt after the date of this Agreement.
7. Intentionally omitted
8. The Bylaws of QBIZ, as existing on this date, shall continue
in full force as the Bylaws of QBIZ until altered amended or
repealed, as provided in the Bylaws or as provided by law.
Appropriate corporate documentation the form of minutes,
resolutions, et al, shall be executed memorializing and
authoring the actions provided for herein.
9. All statements contained in any memorandum, certificate,
letter, document, or other instrument delivered by or on
behalf of QLAB, QBIZ, or the stockholders identified in this
Agreement shall be deemed representations and warranties made
by the respective parties to each other under this Agreement.
The covenants, representations, and warranties of the parties
and the stockholders shall survive for a period of three years
after the effective date. No inspection, examination or audit
made on behalf of the parties or the stockholders shall act as
a waiver of any representation or warranty made under this
Agreement.
10. QLAB and QBIZ shall mutually indemnify and hold each other
harmless against and in respect of all damages. Damages, as
used in this paragraph, shall include any claim, action,
demand, loss, cost, expense, liability, penalty and other
damage, including without limitation, counsel fees and other
costs and expenses incurred in investigating, in attempting to
avoid damage or to oppose the imposition of damages, or in
enforcing this indemnity, resulting to QBIZ or QLAB, as the
case may be, from (i) any inaccurate representation made by or
on behalf of the other or its stockholder(s) in or pursuant to
this Agreement; (ii)
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breach of any of the warranties made by or on behalf of the
other or the stockholder(s), in or pursuant to this Agreement;
(iii) breach or default in the performance by the other of any
of the obligations to be performed by it under this Agreement;
or (iv) breach or default in the performance by the
stockholder(s) of any of the obligations to be performed by
them under any agreement delivered to them by the other
pursuant to this Agreement. The defaulting entity shall
reimburse the non-defaulting entity on demand for any payment
made or for any loss suffered by the non-defaulting entity at
any time after execution hereof, based on the arbitration
following the Rules of the American Arbitration Association or
pursuant to a bona fide compromise or settlement of claims,
demands, or actions, in respect of any damages specified by
the foregoing indemnity. The defaulting entity shall satisfy
its obligations to the other by the payment of cash on demand.
The defaulting entity shall have the opportunity to defend any
claim, action, or demand asserted against the other for which
the other claims indemnity provided that
(a) the defense is conducted by reputable
counsel approved by the non-defaulting
entity, which approval shall not be
unreasonably withheld;
(b) the defense is expressly assumed in writing
within ten days after written notice of the
claim, action or demand is given to the
stockholder(s); and
(c) counsel for the non-defaulting entity may
participate at all times and in all
proceedings (formal and informal) relating to
the defense, compromise, and settlement of
the claim, action, or demand, at the expense
of the other. By their signatures
hereinbelow, BAWARSKY guarantees the
obligations of QLAB set forth in this
paragraph 10.
11. This Agreement may be terminated and the actions contemplated
herein abandoned at any time within 7 days prior to the
closing of this transaction based upon the following:
(A) By mutual consent of the Board of Directors of both
corporate entities.
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(B) At the election of the Board of Directors of either
corporate entity if:
(1) Any litigation or proceeding shall be
instituted or threatened against the other
corporate entity or any of its assets, that,
in the correct opinion of such Board of
Directors, renders the instant transaction
inadvisable or undesirable.
(2) Any legislation shall be enacted that
materially renders the proposed transaction
inadvisable or undesirable.
(3) Between the date of this Agreement and the
completion of obligations provided for
herein there shall have been, in the opinion
of the Board of Directors of either
corporation, any materially adverse change
in the business or condition, financial or
otherwise, of the other corporate entity.
(4) Counsel for either corporation shall have
determined, prior to the completion of
obligations herein, that (a) the exchange of
stock provided for herein shall result in
the requirement of one or more of the
parties to this transaction to pay United
States federal income tax as a result of
ordinary or capital gain, or (b) the
proposed transaction is in violation of
federal, state and local law.
(C) At the election of the Board of Directors of QBIZ if
without the prior consent in writing of QBIZ, QLAB shall
have:
(1) Declared or paid a cash dividend on its
common stock or declared or paid any other
dividend or made any other distribution on
its shares.
(2) Created or issued any indebtedness for
borrowed money. (3) Entered into any
transaction other than those involved in
carrying on its business in the usual
manner.
(D) On or before June 30, 1998, QBIZ shall perform all due
diligence, and QLAB shall perform all obligations referred
to herein and required by each of them prior to closing.
Within 7 days of the date of closing, QBIZ shall advise
QLAB in writing at the address set forth herein of its
intention to terminate this Agreement. In the event QBIZ
does not terminate this
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Agreement on the date of closing, the stock which is the
subject of this transaction shall vest and the matter
shall be closed. However, the representations and
warranties made herein shall survive as indicated herein.
(E) The cost of all due diligence, investigations including
audits, etc., as ordered by QBIZ, shall be borne
exclusively by QBIZ.
12. Any notice or other communication required or permitted under
this Agreement shall be properly given when deposited with the
United States Postal Service for transmittal by certified or
registered mail, postage prepaid, or when deposited with a
public telegraph company for transmittal, charges prepaid,
addressed as follows:
(A) In the case of QBIZ, to: ANDY SMITH ("SMITH"),
President, QBIZ, 5310 NW 33rd Avenue, Suite 212, Fort
Lauderdale, FL 33309, or to such other person or address
as QBIZ may from time to time request in writing.
(B) In the case of QLAB, to: DAVID BAWARSKY, President,
CEO, and Chairman of the Board, QLAB, 2121 West Oakland
Park Blvd., Fort Lauderdale, FL 33309, or to such other
person or address as QLAB may from time to time request in
writing.
13. QBIZ has prepared this Agreement in accordance with
instructions received from SMITH, as President of QBIZ. George
and Lander, P.A./John G. George, Esq. (collectively "George")
has reviewed this agreement in accordance with instructions
received from BAWARSKY as president of QLAB, and therefore,
for the purposes of resolving any ambiguities, if any, QBIZ
and its principal, SMITH, shall be deemed to have participated
in the preparation of all terms and conditions in this
Agreement. The foregoing provisos shall also apply to any and
all agreements, documentation, consents, minutes, etc.
contemplated by and/or referred to in this Agreement.
14. The parties agree to resolve any dispute arising out of a
breach of any of the terms and/or conditions of this Agreement
through arbitration following the Rules of the American
Arbitration Association. The results of such arbitration shall
be binding upon the parties, and the prevailing party shall be
entitled to recover reasonable attorneys' fees and court
costs.
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15. This Agreement and the exhibits to this Agreement contain the
entire agreement between the parties with respect to the
contemplated transaction. This Agreement may be executed in
any number of counterparts, all of which taken together shall
be deemed one original.
16. The validity, interpretation and performance of this Agreement
shall be governed by, construed and enforced in accordance
with the laws of the State of Florida, and exclusive venue
shall be in Broward County, Florida.
IN WITNESS WHEREOF, this Agreement was executed on
the dates set forth after signatures hereinbelow.
QUIKBIZ INTERNET GROUP, INC. QUIKLAB MULTIMEDIA CENTERS, INC.
a Nevada corporation a Florida corporation
By: /s/Andrew D. Smith By: /s/David Bawarsky
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Andrew D. Smith, President David Bawarsky, President
Dated: June 25, 1998 Dated: June 25, 1998
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EMPLOYMENT CONTRACT FOR DAVID BAWARSKY
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THIS AGREEMENT is made June 16, 1998, at the City of Fort Lauderdale, County of
Broward, State of Florida, between QuikLAB Multimedia Centers, Inc. a Florida
Corporation, hereinafter "employer", and DAVID BAWARSKY, hereinafter "employee";
Employer is engaged in the business of creating and providing multimedia
products and services to parties and maintains a business in the City of Fort
Lauderdale, County of Broward, State of Florida;
Employee is willing to be employed by employer, and employer is willing to
employ employee, on the terms, covenants, and conditions set forth in this
agreement;
WHEREAS it is the intent of employer to obtain an employee with integrity and
requisite qualifications to act in an executive management function with the
company, and it is the intent of employee to fulfill the intent of employer and
be compensated for such employment;
THEREFORE, in consideration of the mutual covenants and promises of the parties,
employer and employee covenant and agree as follows:
SECTION ONE: Employer does hire and employ employee as President, CEO and
Chairman of the Board of its entire company, and employee does accept and agree
to such hiring and employment. In consideration of the invaluable and sustaining
contributions during the inception, research and development of the company,
David Bawarsky, will, in perpetuity, possess the title of founder of the
employer-company and its subsequent holdings. This title is not related to
continued employment or any amount of stock holdings retained. Subject to the
supervision and pursuant to the orders, advice, and directions of employer,
employee shall direct all phases of said company, subject only to the final
direction of employer, and shall perform such other duties as are customarily
performed by one holding such position in other 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 employee from
time to time by employer.
SECTION TWO: Employee agrees to perform, at all times faithfully, industriously,
and to the best of his ability, experience, and talent, all of the duties that
may be required of and from him pursuant to the express and implicit terms of
this agreement, to the reasonable satisfaction of employer. Such duties shall be
rendered at employer's Fort Lauderdale place of business and at such other place
or places as employer shall in good faith require or as the interests, needs,
business, and opportunities of employer shall require or make advisable.
SECTION THREE: The term of this agreement shall be for a period of five (5)
years, commencing on June 16, 1998, and terminating on June 15, 2003, subject,
however, to prior
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termination as provided below. Should employer cancel employee's employment
contract, or should employer change (without employee's consent) employee's
position as President, CEO and Chairman of the Board, employee shall receive a
lump sum liquidated amount of TWO MILLION ($2,000,000,00) DOLLARS as severance
pay from employer, and all benefits under his employment agreement will
terminate. Notwithstanding, if employee remains employed by employer for two
years from date of his employment agreement, then the options infra Section Four
(with respect to employer doubling its net earnings after three years) remain in
full force and effect.
SECTION FOUR: Employer shall pay employee and employee agrees to accept from
employer, for employee's services under this agreement, compensation at the
gross rate of ONE HUNDRED SEVENTY FIVE THOUSAND ($175,000) DOLLARS per year for
serving as Chairman, President and CEO. Said compensations shall be paid on a
weekly basis and shall be increased by 20% per year effective the first day of
January, 1999, during the term of this contract. It is expressly understood that
employee's compensation under this agreement may be supplemented by additional
stock option plans from employer. In addition, employer agrees to establish an
expense account from which it will reimburse employee for any and all necessary,
customary, and usual expenses incurred by him on behalf of the employer pursuant
to employer's directions. Employee shall also have a non-accountable expense
account in the annual amount of $25,000. Employer shall also provide employee a
cellular telephone.
SECTION FIVE: Employer shall provide term life insurance of $2,000,000 for
employee with employee's spouse as beneficiary, and term life insurance of
$500,000 for employee's spouse with employee as beneficiary in the event of
death during the term of this agreement.
SECTION SIX: Employer shall provide family health insurance as well as dental
insurance to employee with no contribution required from employee.
SECTION SEVEN: Employer shall provide two company vehicles (Lexus 400), or the
financial equivalent at employee's option, to employee and employee's spouse and
provide all maintenance, insurance, repair and fuel to said vehicle.
SECTION EIGHT: Employer shall provide four (4) weeks annual paid vacation and
one (1) weeks annual paid sick leave to employee. In addition to vacation and
sick days, the employee shall have the following designated holidays: New Year's
Day, Birthday of Martin Luther King, Jr., Lincoln's Birthday, Washington's
Birthday, Memorial Day, July 4th, Labor Day, Rosh Hashanah, Yom Kippur, and
Hanukah (Note: Should any of the above dates fall on Saturday, the previous
Friday shall be deemed as a holiday. Should any of the above dates fall on
Sunday, the following Monday shall be deemed as a holiday).
SECTION NINE: Employer shall compensate employee as a "Performance Incentive
Bonus" as follows:
Sliding Scale as follows:
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Based upon Net Profit of employer.
From 0 to $149,000 10% of net profit
From $150,000 to $299,000 15% of net profit
From $300,000 and over 20% of net profit
To be paid at the end of each fiscal year.
SECTION TEN: Notwithstanding anything in this agreement to the contrary,
employer has the option to terminate this agreement in the event that during its
term employee shall become permanently disabled as the term permanently disabled
is defined below. Such option shall be exercised by employer giving notice to
employee by registered mail. The giving of such notice this agreement and the
term of this agreement come to an end on the last day of the month in which the
notice is mailed, with the same force and effect as is that day were originally
set forth as the termination date. For the purposes of the agreement, employee
shall be deemed to have become permanently disabled if, during any year of the
term of this agreement, because of ill health, physical or mental disability, or
for other causes beyond his control, he shall have been continuously unable or
unwilling or have failed to perform his duties under this contract for one
hundred eighty (180) consecutive days (hereinafter referred to as "medically
disabled"), or if, during any year of the term of this agreement, he shall have
been unwilling or have failed to perform his duties for a total period of forty
five (45) consecutive days (hereinafter referred to as "voluntary termination").
For the purposes of this agreement, the term "any year of the term of this
agreement" is defined to mean any period of twelve (12) calendar months
commencing on the first day of May and terminating on the last day of April of
the following year during the term of this agreement. In the event employee is
medically disabled as described above, all provisions in Section Three, supra,
shall remain in full force and effect. In the event employee is under voluntary
termination as described above, employer will be under no obligation to provide
any benefits within this entire agreement.
SECTION ELEVEN: Employee shall devote his time, attention, knowledge, and skill
to the business and interest of employer, and employer shall be entitled to all
of the benefits, emoluments, profits, or other issues arising from or incident
to any and all work, services, and advice of employee, and employee expressly
agrees that during the term of this agreement he will not be interested,
directly or indirectly, in any form, fashion, or manner, as partner, officer,
director, stockholder, advisor, employee, or in any other form or capacity, in
any other business similar to employer's business or any allied trade; provided
however, that nothing shall be deemed to prevent or limit the right of employee
to invest any of his funds in the capital stock or other securities of any
corporation whose stock or securities are publicly owned or are regularly traded
on any public exchange, nor shall anything be deemed to prevent employee from
investing or limit employee's right to invest his funds in real estate.
SECTION TWELVE: Employee further specifically agrees that he will not at any
time, in any manner, either directly or indirectly, communicate to any person,
form, or corporation any information of any kind concerning any matters
affecting or relating to the business of employer, including, without limiting
the generality of the foregoing, the names of any of its customers,
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the prices it obtains or has obtained or at which it sells or has sold its
products, or any other information of, about, or concerning the business of
employer, its manner of operation, its plans, processes, or other date of any
kind, nature, or description without regard to whether any or all of the
foregoing matters would be deemed confidential, material, or important, the
parties stipulating that as between them, the matters are important, material,
and confidential and gravely affect the effective and successful conduct of the
business of the employer, and its goodwill, except in the course and scope of
employee's employment and the advancement of the employer's business. Any breach
of the terms of this paragraph is a material breach of this agreement and may
subject employee to termination as provided in Section Ten, supra.
SECTION THIRTEEN: Anything contained in this agreement to the contrary
notwithstanding, it is understood and agreed that employee shall not have the
right to make any contract or commitments for or on behalf of employer without
the written consent of employer.
SECTION FOURTEEN: It is expressly understood that this agreement is between the
employee and QuikLAB Multimedia Centers, Inc., a Florida corporation.
SECTION FIFTEEN: This written agreement contains the sole and entire agreement
between the parties and shall supersede any and all other agreements between the
parties. The parties acknowledge and agree that neither of them has made any
representation with respect to the subject matter of this agreement or any
representations inducing its execution and delivery except such representations
as are specifically set forth in this writing and the parties acknowledge that
they have had the opportunity to have legal counsel of their choice review this
agreement prior to entering into the same.
SECTION SIXTEEN: It is agreed that no waiver or modification of this agreement
or of any covenant, condition, or limitation contained in it shall be valid
unless it is in writing and duly executed by the party to be charged with it,
and that no evidence of any waiver or modification shall be offered or received
in evidence in any proceeding, arbitration, or litigation between the parties
arising out of or affecting this agreement, or the rights or obligations of any
party under it, unless such waiver or modification is in writing, duly executed
as above. The parties agree that the provisions of this paragraph may not be
waived except by a duly executed writing.
SECTION SEVENTEEN: The parties agree that it is their intention and covenant
that this agreement and performance under it and all suits relating to it be
construed in accordance with and under and pursuant to the laws of the State of
Florida, with venue in Broward County.
SECTION EIGHTEEN: This agreement shall be binding on and inure to the benefit of
the respective parties and their executors, administrators, heirs, personal
representatives, successors and assigns.
SECTION NINETEEN: Severability. Should any portion of this agreement be found to
be unenforceable at law or in equity, the remaining provisions of this agreement
are to remain in
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full force and effect.
SECTION TWENTY: Attorneys fees and costs. In the event of litigation arising out
of the enforcement of any term or condition of this Agreement, the prevailing
party shall be entitled to recover all attorneys fees and costs of litigation,
through appellate level.
NOTICE REQUIREMENTS SENT TO:
David Bawarsky, 2121 W. Oakland Park Blvd, Fort Lauderdale, FL 33309. QuikLAB
Multimedia Centers, Inc., 2121 W. Oakland Park Blvd, Fort Lauderdale, FL 33309.
EMPLOYER: EMPLOYEE:
QUIKLAB MULTIMEDIA CENTERS, INC. DAVID BAWARSKY
A Florida Corporation
BY: /s/David Bawarsky /s/David Bawarsky
- --------------------- -----------------------
David Bawarsky, CEO David Bawarsky
WITNESSES:
/s/Kirk J. Girrbach /s/Andrew D. Smith
- -------------------- -----------------------
Kirk J. Girrbach Andrew D. Smith
5
