EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (“Agreement”)
is entered into effective as of the 7th day of August, 2009,
between IMAGENETIX, INC., a Nevada corporation (the “
Company ”), and William P. Spencer (“
Executive ”).
WHEREAS, Executive is presently serving as the
President, Chairman of the Board and Chief Executive Officer of the
Company without a written employment agreement, and
WHEREAS, the Company wishes to ensure the
continued service of Executive to the Company pursuant to the terms
of this Agreement;
NOW, THEREFORE, in consideration of the promises
and the mutual covenants hereinafter set forth and other good and
valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto hereby agree as
follows:
1. Position and Duties .
(a) Effective as of the date of this Agreement
(the “ Effective Date ”), and until the second
anniversary of the Effective Date (the “ Initial Term
”), the Executive will be employed by the Company on a
full-time basis as its President and Chief Executive Officer. The
Executive shall be a member of the Board of Directors of the
Company and Chairman of the Board. In addition, the Executive may
be asked from time to time to serve as a director or officer of one
or more of the Company’s subsidiaries, or as a member of a
committee of the Board of Directors, without further compensation.
The Initial Term shall be automatically renewed for additional
periods of two (2) years (each, a “ Renewal Term
”) unless written notice to the contrary shall be given by
either party to the other not less than thirty (30) days prior
to the end of the Initial Term or the Renewal Term. The
Initial Term and the Renewal Term are referred to herein as the
“ Term ”.
(b) The Executive agrees to perform the duties
of his position and such other duties consistent with those of a
chief executive officer as may reasonably be assigned to the
Executive from time to time by the Board of Directors. The
Executive also agrees that, while employed by the Company, the
Executive will devote a significant portion of his business time
and efforts to the advancement of the business and interests of the
Company and its subsidiaries and to the discharge of his duties and
responsibilities for them. Notwithstanding the above, the Executive
shall be permitted to manage his personal, financial and legal
affairs; and, serve on civic, educational, philanthropic or
charitable boards or committees.
(c) The Company agrees to maintain a corporate
office in the County of San Diego, California sufficient to support
senior management, including the incorporation of related functions
(for example, but not to be limited to, administrative, sales and
marketing positions).
2.
Compensation and Benefits . During the Executive’s
employment, as compensation for all services performed by the
Executive for the Company and its subsidiaries, the Company will
provide the Executive the following pay and benefits:
(a) Base Salary . The Company will pay
the Executive a base salary at the rate of Two Hundred Thousand
Dollars ($200,000) per year (“ Base Salary ”),
payable in accordance with the regular payroll practices of the
Company and subject to increase from time to time by the Board of
Directors of the Company (the “ Board ”) in
their discretion.
(b) Bonus Compensation . During the Term,
the Executive shall receive a bonus equal to six percent (6%) of
the Company’s net income before taxes and research and
development expenses during the prior fiscal year, up to a maximum
of fifty percent (50%) of the Base Salary.
(c) Stock Options . Executive shall
be eligible to receive options to purchase shares of common stock
of the Company in such amounts and at such exercise prices as the
Board of Directors may determine from time to time.
(d) Participation in Employee Benefit Plans
and Vacation Policies . The Executive will be entitled to
participate in all employee benefit plans and vacation policies in
effect for employees and senior executives of the Company. The
Executive’s participation will be subject to the terms of the
applicable plan documents and generally applicable Company
policies.
(e) Business Expenses . The Company will
pay or reimburse the Executive for all reasonable business expenses
incurred or paid by the Executive in the performance of his duties
and responsibilities for the Company. Reimbursements shall be
subject to such reasonable substantiation and documentation as the
Company may specify from time to time.
3.
Termination of Employment . The Executive’s employment
under this Agreement shall continue until
terminated pursuant to this Section 3.
(a) The Company may terminate the
Executive’s employment for Cause with at least thirty
(30) days advance written notice to the Executive setting
forth in reasonable detail the nature of the Cause. For purposes of
this Agreement, “ Cause ” means any of the
following: (i) the Executive’s continued and substantial
violations of his employment duties or willful and material
disregard of reasonable directives from the Board, after Executive
has received a written demand for performance from the Board that
sets forth the factual basis for the Company’s belief that
Executive has not substantially performed his duties or willfully
disregarded directives from the Board; (ii) the
Executive’s moral turpitude, material dishonesty or gross
misconduct in the performance of his duties which has materially
and demonstrably injured the finances or future business of the
Company or any of its subsidiaries as a whole; (iii) the
Executive’s material breach of this Agreement; or,
(iv) the Executive’s conviction of, or confession or
plea of no contest to, any felony or any other act of fraud,
misappropriation, embezzlement, or the like involving the
Company’s property; provided, however, that no such act or
event described in clauses (i) and (iii) of this
paragraph (a) shall constitute Cause hereunder if the
Executive has materially cured such act or event during the
applicable thirty (30) day notice period.
(b) The Executive may terminate his employment
for Good Reason with at least thirty (30) days advance written
notice to the Company setting forth in reasonable detail the nature
of the Good Reason. For purposes of this Agreement, “ Good
Reason ” means implementation of any of the following
directives by the Board without Executive’s prior written
consent: (i) the assignment to the Executive of duties
inconsistent with the Executive’s status as the Chief
Executive Officer or a materially adverse alteration in the nature
of the Executive’s duties and/or responsibilities, reporting
obligations or authori
