|
EMPLOYMENT AGREEMENT
(Thomas W. Maher)
THIS EMPLOYMENT AGREEMENT (the
"Agreement"), effective as of December 1, 2006
("Effective
Date") is entered into by and between Thomas W.
Maher, having an address at 324 Plaza Los Osos, Chula Vista, CA
91914 ("Employee"), and Ethos Environmental, Inc., a Nevada
Corporation ("Company" or "Ethos").
RECITALS
WHEREAS , the Company desires
for the Employee to serve Chief Financial Officer/Controller of the
Company and the parties hereto desire for the Employee to continue
serving in such capacity; and
WHEREAS , no formal document
exists governing the relationship between the Company and the
Employee, and the Company and Employee desire by the execution of
this Agreement to create a document memorializing the terms and
conditions of the Employee’s service with the Company;
and
WHEREAS , the Company has
granted Employee, by unanimous written consent of the Board of
Directors effective as of even date herewith, 100,000 shares
of the Company’s Common Stock, par value $0.001, (the "Issued
Stock") as bonus consideration for past services and for services
hereunder.
NOW, THEREFORE , in
consideration of the mutual agreements hereinafter set forth,
Employee and the Company have agreed and do hereby agree as
follows:
AGREEMENT
1. Duties. The Company hereby agrees to
employ and engage Employee as the Chief Financial
Officer/Controller of the Company, and Employee hereby accepts and
agrees to such hiring, engagement, and employment. Employee agrees
to perform any and all duties and to assume any and all
responsibilities that may be assigned to him from time to time by
the Chief Executive Officer or the Board of Directors of the
Company or that may be required by the Bylaws, Articles of
Incorporation or other governing document of the Company. During
the duration of his employment, Employee will devote his full time,
energy, and skill to the performance of his duties for the Company
and for the benefit of the Company. Employee shall render such
services to the Company and perform his duties at such place or
places in as the Company shall require in accordance with its best
interests, needs, business and opportunities. Employee will also
exercise due diligence and care in the performance of
Employee’s duties to the Company under this Agreement. Except
for employment with Luminart Corp., during the term hereof,
Employee shall not enter into the services of or be employed in any
capacity or for any purposes whatsoever, whether directly or
indirectly, by any person, firm, corporation or entity other than
Company, and will not, during said period of time, be engaged in
any business, enterprise or undertaking other than employment by
the Company.
2. Employment Period. Employee’s
employment with the Company shall be for an initial term of one (1)
year (the "Initial Term"), commencing on the date hereof and shall
continue thereafter until ended in accordance with this Agreement.
In the absence of a Notice of Termination, as provided herein, this
Agreement shall renew automatically on the anniversary date hereof,
on a year by year term, for each of the successive two years
("Extended Term") following the Effective Date. Provided, however,
after the Initial Term, Employee’s employment will be "at
will," meaning that either Employee or the Company will be entitled
to terminate the employment at any time and for any reason, with or
without cause prior to the expiration of this Agreement. Any
contrary representations which may have been made to Employee are
superseded by this Agreement. The "at will" nature of the
employment after the Initial Term may only be changed in an express
written agreement signed by Employee and a duly authorized officer
of the Company.
3. Compensation .
(a) Base Salary . The Company shall pay
Employee, and Employee agrees to accept from the Company in full
payment for Employee’s services and promises to the Company
(specifically including the covenants set forth in Sections 5 and
9, below), a base salary at the rate of $7,000.00 per month during
the duration of Employee’s employment ("Base Salary"),
payable in equal monthly installments or otherwise in accordance
with the Company’s normal pay practices as the same may be
altered from time to time by Company.
(b) Bonus . At the discretion of the Board
of Directors, and subject to the satisfaction of such conditions or
performance criteria as may be established from time to time at the
sole discretion of the Board of Directors, Employee may, from time
to time, receive a bonus. This bonus may consist of, without
limitation, either equity interests of the Company ("Issued Stock")
or cash.
(c) Withholding Taxes . All forms of
compensation paid or payable to Employee whether set forth in this
Agreement or otherwise are subject to reduction to reflect
applicable withholding and payroll taxes.
(d) Reimbursement for Business Expenses .
Employee shall receive reasonable and customary reimbursement for
business expenses incurred on behalf of the Company; provided,
however, that Employee shall provide appropriate receipts and
documentation for any such expenses.
(e) Vacation . Employee shall be entitled
to vacation on the terms and subject to the conditions established
by the Board of Directors of the Company.
(f) Health Care & Life Insurance
Benefits . In addition to Employee’s Base Salary during
the duration of the Employee’s employment, when and if the
Company adopts health care benefits and/or at life insurance
benefit, Employee shall be eligible for participation in any such
plan(s) on the terms and subject to the conditions established by
the Board of Directors of the Company.
4. Issued Stock; Transferability . The
Issued Stock and the rights and privileges conferred in whole or in
part hereby may not be transferred, assigned, pledged or
hypothecated in any way (whether by operation of law or otherwise),
and the Company shall have no obligation to transfer such shares,
unless registered under the Securities Act of 1933, as amended (the
"Act") or, in the opinion of counsel to the Company, such
transaction is in compliance with or exempt from the registration
and prospectus requirements of the Act. The Employee shall pay all
costs incurred by the Company in such a transaction, including but
not limited to legal fees and costs. The Issued Stock shall not be
subject to levy and execution, attachment or similar process. Upon
any attempt to transfer, assign, pledge, hypothecate or otherwise
dispose of the Issued Stock, or any right or privilege conferred
hereby, contrary to the provisions of this Agreement, or upon the
levy or execution, attachment or similar process on the Issued
Stock or the rights and privileges conferred under this Agreement,
the Company shall have the right to buy back the Issued Stock, in
whole or in part, in the manner described in Section 6. Each
certificate or other documentation evidencing the ownership of any
shares of Issued Stock to be imprinted with a legend in
substantially the following form:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE
REOFFERED, SOLD, TRANSFERRED, PLEDGED, OR ASSIGNED IN THE ABSENCE
OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER SAID ACT AND THE STATE SECURITIES ACT OR BLUE SKY ACT OF ANY
STATE HAVING JURISDICTION THEREOF, OR (B) AN OPINION OF
COUNSEL, REASONABLY SATISFACTORY IN FORM, SCOPE AND SUBSTANCE TO
THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR
THE SECURITIES ACT OR BLUE SKY ACT OF ANY STATE HAVING JURISDICTION
WITH RESPECT THERETO. ADDITIONALLY, THE SECURITIES REPRESENTED
HEREBY ARE SUBJECT TO AN OPTION TO REPURCHASE IN FAVOR OF THE
COMPANY AS DESCRIBED IN THAT CERTAIN EMPLOYMENT AGREEMENT DATED
DECEMBER 1, 2006.
The certificate may also bear additional
inscriptions that the Company, in its sole and absolute discretion,
otherwise deems are required by federal, state, foreign or local
securities laws. All shares of Issued Stock shall be subject to
such stop-transfer orders and other restrictions as the Company may
deem advisable under the rules, regulations, and other requirements
of the US Securities and Exchange Commission, any stock exchange
upon which the Common Stock is then listed, and any applicable
federal or state securities law, and the Company may cause a legend
or legends to be put on any certificates evidencing such shares to
make appropriate reference to such restrictions.
5. Restrictions on the Issued Stock . The
Issued Stock is subject to all restrictions in this Agreement. By
acceptance of the Issued Stock, the Employee agrees that the Issued
Stock will be held for investment and will not be held with a view
to their distribution, as that term is used in the Act, unless in
the opinion of counsel to the Company, such distribution is in
compliance with or exempt from the registration and prospectus
requirements of that Act. As a condition of this Agreement, the
Company may require the Employee to confirm any factual matters
reasonably requested by counsel for the Company.
THE EMPLOYEE UNDERSTANDS THAT THE ISSUED STOCK
WILL NOT BE REGISTERED AT THE TIME THIS AGREEMENT UNDER THE
SECURITIES ACT. THE EMPLOYEE REPRESENTS THAT IT IS EXPERIENCED IN
EVALUATING COMPANIES SUCH AS THE COMPANY, HAS SUCH KNOWLEDGE AND
EXPERIENCE IN FINANCIAL AND BUSINESS MATTERS AS TO BE CAPABLE OF
EVALUATING THE MERITS AND RISKS OF ITS INVESTMENT, AND HAS THE
ABILITY TO SUFFER THE TOTAL LOSS OF THE INVESTMENT. THE EMPLOYEE
FURTHER REPRESENTS THAT IT HAS HAD THE OPPORTUNITY TO ASK QUESTIONS
OF AND RECEIVE ANSWERS FROM THE COMPANY CONCERNING THE TERMS AND
CONDITIONS OF THE ISSUED STOCK, THE COMMON STOCK, AND THE BUSINESS
OF THE COMPANY, AND TO OBTAIN ADDITIONAL INFORMATION TO SUCH
EMPLOYEE’S SATISFACTION. THE EMPLOYEE FURTHER REPRESENTS THAT
IT IS AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF REGULATION D
UNDER THE ACT, AS PRESENTLY IN EFFECT.
6. Resignation; Termination for Cause; Other
Terminations .
(a) Resignation . Employee shall have the
right to terminate this Agreement at any time upon thirty
(30) days prior written notice to the Company of any such
termination ("Employee Notice of Termination"). In the event that
such resignation is for Good Reason (as that term is defined
below), all of Employee’s rights and all of the
Company’s obligations hereunder shall terminate effective on
the date of Employee’s resignation and Employee shall be
entitled to receive the unpaid portion of the Base Salary earned up
to the date of such termination and all benefits payable to
Employee as a result of such termination under the terms of the
Company’s applicable employee benefit plans. In the event
Employee shall resign for other than Good Reason, Employee’s
obligations and the Company’s rights under Sections 5, 6, 7,
8, 9 and 10 shall survive the termination of this Agreement for a
period of one (1) year, and the Issued Stock will be subject
to the Option to Repurchase as set forth below. The Employee may
terminate the Employee’s employment with the Company at any
time for "Good Reason", if any of the following have occurred
without the Employees consent:
(i) the material reduction of the
Employee’s authority, duties and responsibilities, or the
assignment to the Employee of duties materially inconsistent with
the Employee’s position or positions with the Company and its
subsidiaries, except that the Company shall have thirty
(30) days from the date on which the Employee gives the notice
thereof to cure such event or condition and, if the Company does
so, such event or condition shall not constitute Good Reason
hereunder;
(ii) a reduction of the Annual Salary of the
Employee, except that a reduction of the Employee’s Base
Salary shall not constitute Good Reason for termination if
(i) the Company cures such reduction no later than thirty
(30) days from the date on which the Employee gives the
Company notice that the reduction constitutes Good Reason for
termination hereunder; or (ii) such reduction is made in
connection with a reduction in compensation of not more than ten
percent (10%) of the Employee’s Base Salary and such
reduction is made generally applicable to all senior management
employees of the Company;
(iii) the failure by the Company to obtain an
agreement in form and substance reasonably satisfactory to the
Employee from any successor to the business of the Company to
assume and agree to perform this Agreement;
(iv) the Company’s material and willful
breach of this Agreement, except that the Company shall have thirty
(30) days from the date on which the Employee gives the notice
thereof to cure such event or condition and, if the Company does
so, such event or condition shall not constitute Good Reason
hereunder;
(v) a requirement by the Company that
Employee’s work location be moved more than fifty
(50) miles of the Company’s principal place of business
in San Diego, California; or
(vi) the occurrence of a change of control, which
for purposes of this Agreement shall mean the sale to an
independent third party or group of independent third parties of
either (i) more than fifty percent (50%) of the issued
and outstanding equity securities of the Company and the voting
power under normal circumstances to elect a majority of the
Company’s Board of Directors (whether by merger,
consolidation, sale or transfer of the Company’s equity
securities); or (ii) all or substantially all of the
Company’s assets determined on a consolidated
basis.
(b) Termination for Cause . The Company
may terminate Employee’s employment at any time for Cause (as
defined below) with thirty (30) days written notice and
opportunity to cure the violation ("Employer Notice of
Termination"). Such opportunity to cure will only be available if
the violation is contained in one of the following paragraphs
(contained below in this Subsection 6(b)): (iv), (viii), (ix),
(x) (xi). If Employee’s employment is terminated
pursuant to this Subsection 6(b), all of Employee’s rights
and all of the Company’s obligations hereunder shall
immediately terminate. As used in this section, "for Cause" shall
mean any of the following:
(i) Willfully damaging the Company’s
property, business, reputation or goodwill;
(ii) Committing a felony;
(iii) Death, theft, dishonesty, fraud or
embezzlement;
(iv) Using alcohol, narcotics or other controlled
substances to the extent that it prevents the Employee from
efficiently performing services for the Company;
(v) Willfully injuring any other employee of the
Company;
(vi) Willfully injuring any person in the course
of performance of services for the Company;
(vii) Disclosing to a competitor or other
unauthorized persons, confidential or proprietary information, or
secrets of the Company;
(viii) Soliciting business on behalf of a
competitor or a potential competitor of the Company;
(ix) Sexually harassing any other employee of the
Company or committing any act which otherwise creates an offensive
work environment for other employees of the Company;
(x) Failing to comply with any provision of the
Company’s policy manual or standard operating procedures as
it applies to Employee; or
(xi) Breaching this Agreement.
The Company shall not be limited to termination
as a remedy for any improper or illegal act of Employee, but may
also seek damages, injunction or such other remedy as it may deem
appropriate under the circumstances. This shall include without
limitation the option by the Company, in its sole and absolute
discretion, to repurchase the Issued Stock, in whole or in part,
for an amount of $.001 per share (the "Option to Repurchase"),
immediately upon the termination of the Employee’s employment
with the Company for Cause, or the Employee’s resignation
without Good Reason. Upon the termination of the Employee for
Cause, Employee’s obligations and the Company’s rights
under Sections 7, 8, 9, 10, 11 and 12 shall survive the termination
of this
|
