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EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made
and entered into as of May , 2007, by and between
The Phone Card Warehouse Inc . , a
Florida corporation, with an office located at 10376 E. Colonial
Drive #135, Orlando, FL 32817 (the " Company"), and Kaushika
Patel , an individual and resident of New
York ("Executive").
WHEREAS, the Company is in the business of
distributing prepaid telephone service products; and
WHEREAS, Executive has had experience in the
operations of businesses distributing prepaid telephone service
products; and
WHEREAS, the Company desires to retain the services
of Executive; and
WHEREAS, Executive is willing to be employed by the
Company; and
WHEREAS, the Company is a wholly-owned subsidiary
of Reliablecom, Inc., a Delaware corporation
(“Parent”);
NOW, THEREFORE, in consideration of the mutual
covenants contained herein, the parties agree as follows:
1. Employment . Executive is hereby
employed and engaged to serve the Company as the Controller of the
Company, or such additional titles as the Board of Directors of the
Company shall specify from time to time, and Executive does hereby
accept, and Executive hereby agrees to such engagement and
employment.
2. Duties. Executive shall be
responsible for customary duties performed by a corporate
controller. Executive shall diligently and faithfully execute
and perform such duties and responsibilities, subject to the
general supervision and control of the Company’s board of
directors and Chief Executive Officer. Executive shall be
responsible and report only to the Company’s board of
directors and Chief Executive Officer. The Company’s
board of directors and Chief Executive Officer, in their sole and
absolute discretion, shall determine Executive’s duties and
responsibilities and may assign or reassign Executive to such
duties and responsibilities as it deems in the Company's best
interest. Executive shall devote her full-time attention,
energy, and skill during normal business hours to the business and
affairs of the Company and shall not, during the Employment Term,
as that term is defined below, be actively engaged in any other
business activity, except with the prior written consent of the
Company’s board of directors.
During the term of this Agreement, Company shall
continue its business activities in substantially the same manner
as had existed during the twelve month period immediately preceding
the date of this Agreement. Company shall not transfer its
business operations to any affiliate or nonaffiliate of Company
during the term of the Agreement. Executive shall devote
Executive’s full-time attention, energy, and skill during
normal business hours to the business and affairs of the Company
and shall not, during the Employment Term, as that term is defined
below, be actively engaged in any other business activity, except
with the prior written consent of the Company’s board of
directors.
Nothing
in this Agreement shall preclude Executive from devoting reasonable
periods required for:
(a)
serving as a director or member of a committee of any
organization or corporation involving no conflict of interest with
the interests of the Company;
(b)
serving as a consultant in her area of expertise (in
areas other than in connection with the business of the Company),
to government, industrial, and academic panels where it does not
conflict with the interests of the Company; and
(c)
managing her personal investments or engaging in any
other non-competing business;
provided that such activities do not interfere with the
regular performance of her duties and responsibilities under this
Agreement as determined by the Company.
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3. Best Efforts of Executive .
During her employment hereunder, Executive shall, subject
to the direction and supervision of the Company’s board of
directors, devote her full business time, best efforts, business
judgment, skill, and knowledge to the advancement of the
Company's interests and to the discharge of her duties and
responsibilities hereunder.
4. Employment Term . This Agreement shall
have a term of three (3) years, beginning on the date of this
Agreement (the "Employment Term"). Upon the initial expiration of
the Employment Term or any renewal thereof (a “Term”),
this Agreement shall automatically be extended for one additional
year, unless a written notice of termination shall be provided at
least 90 days prior to the expiration of the Term or unless
terminated by either party pursuant to Section 12.
5. Compensation of Executive . During
the first three years of the Term of this Agreement, the Executive
shall be paid a salary of $6,250.00 per month, payable in
accordance with the Company’s regular payroll practices.
Commencing after three years, as preliminary compensation for
the services provided by Executive under this Agreement, the
Company shall pay Executive a monthly draw of $6,250.00 as an
advance on actual compensation, to be paid in accordance with the
Company's usual payroll procedures. Within fifty (50) days after
the end of each of the first three fiscal quarters of the Company,
the Company’s Chief Financial Officer shall prepare quarterly
financial statements in accordance with generally accepted
accounting principals (“GAAP”). Such financial
statement shall include a calculation of the Company’s net
profit for quarter in accordance with GAAP and after deduction for
accounts receivable which have been outstanding for more than 45
days (“Quarterly Net Profit”). The Executive
shall be paid an amount, if any, by which 25% of the Quarterly Net
Profit exceeds $62,500 (each, a “Quarterly Payout”).
Notwithstanding the foregoing, in the event 25% of the
Quarterly Net Profit shall be less than $62,500 (the
“Quarterly Shortfall Amount”), the monthly draw for the
following quarter shall be reduced by an amount equal to the
Quarterly Shortfall Amount, divided by three. Within one hundred
five (105) days after the end of the Company’s fourth fiscal
quarter, the Company shall prepare an annual financial statement in
accordance with GAAP. Such financial statement shall include a
calculation of the Company’s net profit for year in
accordance with GAAP and after deduction for accounts receivable
which have been outstanding for more than 45 days (“Annual
Net Profit”). The Executive shall be paid an amount, if
any, by which 25% of the Annual Net Profit exceeds $250,000, plus
all Quarterly Payouts for such fiscal year. In the event the
Company does not have a net profit based on the Quarterly Net
Profits and Annual Net Profit, the aggregate loss for such period
shall be carried forward to the following fiscal year. All
payments shall be made within fifteen (15) days of delivery of the
quarterly financial statements and profit calculation to the
Executive.
6. Benefits. Executive shall also be
entitled to participate in any
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