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State of ______________
County of ______________

[Name] (“Employer”) and [name] (“Employee”), for good and valuable consideration and in exchange for the mutual promises and covenants exchanged one unto another, the parties hereby agree to the following Employment Contract:


1.1 Employer agrees to pay Employee, during the term of this agreement, a salary pursuant to the schedule attached hereto as Schedule A, which salary shall be equal to the net operating income of Employer, as that term is defined in the attached Schedule A.

1.2 Employee will receive a monthly draw, payable in two (2) equal installments on the fifth (5th) and twentieth (20th) of each month during the term of this agreement. The amount of the draw will be determined in accordance with the criteria set forth in Schedule A.

1.3 The balance of the salary, if any, not paid to Employee through Employee’s monthly or quarterly draws as provided in this Agreement shall be paid within (____) days of the end of the fiscal year of Employer.

1.4 All draws received by Employee shall be credited against Employee’s salary and all compensation shall be subject to the customary withholding tax and other employment taxes as required by law with respect to compensation paid by an Employer to an Employee.

1.5 Employee will also be entitled to certain fringe benefits described in the attached Schedule A.


2.1 During the period of employment hereunder, Employee shall devote Employee’s full time and efforts to the business and affairs of Employer, with the exception of vacation time as provided below.

2.2 Employee shall use his or her best efforts to promote the interests of Employer, [add, as appropriate: serve as a director of Employer and hold the offices in the Corporation to which from time to time Employee may be elected or appointed].


3.1 Employer shall furnish Employee with facilities and services suitable to Employee’s position and adequate for the performance of Employee’s duties.


4.1 Employee shall be entitled to an annual vacation as specified on Schedule A, without loss of compensation.

4.2 Employee shall be entitled to such additional time without loss of compensation for attendance at meetings and conventions related to Employer’s business as the Board of Directors shall from time to time determine.


5.1 This Agreement may be terminated by Employer upon the occurrence of any of the following events:

1. The death of Employee;

2. At Employer’s option, Employee’s permanent disability. Employer’s option shall be exercised in writing, delivered to Employee and shall be effective on delivery;

3. Employee’s failure to comply with one of the following specified material terms or conditions: [_________________]

4. The operation of Employer’s business in such a manner as to show an aggregate net income of $[Amount] for ___________ consecutive months in excess of ____ percent (___%) of net sales for the months.

5.2 Upon termination for any of the foregoing causes, Employee shall be entitled to receive only the compensation accrued but unpaid as of the date of termination and shall not be entitled to additional compensation except as expressly provided in this Agreement.

5.3 If Employee dies during the term of this employment, Employer shall pay to the estate of Employee the compensation which would otherwise be payable to Employee up to the end of the month in which Employee’s death occurs.


6.1 Employee agrees to observe and comply with the rules and regulations of Employer as adopted by Employer’s Board of Directors, either orally or in writing, respecting performance of Employee’s duties, and to carry out and to perform orders, directions, and policies conveyed by Employer to Employee from time to time, either orally or in writing.


7.1 Employee is authorized to incur reasonable expenses for promoting the business of Employer, including expenses for entertainment, travel, and similar items.

7.2 Employer will reimburse Employee for all such expenses upon the presentation by Employee, from time to time, of an itemized account of those expenditures, provided, however, Employee shall not make any expenditure of $[Amount] or more, or a commitment to expend $[Amount] or more during Employer’s fiscal year without the written authorization of Employer’s President.


8.1 In the event any compensation paid to Employee or expenses paid for Employee, or any reimbursement of expenses paid to Employee shall, upon audit or other examination of the income tax returns of Employer, be determined not to be allowable deductions from the gross income of Employer and the determination shall be agreed to by Employer, or the determination shall be made final by the appropriate State or Federal taxing authority or a final judgment of a court of competent jurisdiction, and no appeal is taken therefrom, or the applicable period for filing notice of appeal shall have expired, Employee will repay to Employer the amount of the disallowed compensation or expenses, or both. Repayment may not be waived by Employer.


9.1 The parties recognize that the Board of Directors of Employer, in accordance with the statutes of the State of __________, shall manage the business affairs of Employer.

9.2 Employee shall be considered under the provisions of this agreement as being entitled to participate in any plans, arrangements or distributions by Employer pertaining to or in connection with any pension, bonus, profit sharing, group life insurance, disability insurance, medical insurance, or similar benefits for key employees of the Company.

9.3 Nothing contained in this Agreement shall be construed to give Employee any interest in the physical assets or the accounts receivable of Employer.


10.1 In the event that Employee shall be permanently disabled for a period of more than three (3) months, Employee shall receive compensation for three (3) months after commencement of disability, as provided in Schedule A.

10.2 Employee’s full compensation shall be reinstated upon Employee’s return to employment and the discharge of Employee’s full duties hereunder. Notwithstanding anything in this Agreement to the contrary, Employer may terminate this agreement at any time after Employee has been absent from Employee’s employment, for whatever cause, for a continuous period of more than three (3) months, and all obligations of Employer hereunder shall cease upon any such termination.

11. TERM

11.1 The term of this agreement shall be for a period of ____________ years, commencing on the effective date of this agreement and terminating on the second anniversary thereof, subject, however, to prior termination as provided above.

11.2 This agreement shall be automatically renewed for a succeeding term of ______ years provided the contract has not been violated or terminated.


12.1 The parties hereto agree that the covenants, agreements and restrictions (hereinafter “this covenant”) contained herein are necessary to protect the business goodwill, business interests and proprietary rights of _____________ and that the parties hereto have independently discussed, reviewed and had the opportunity of legal counsel to consider this agreement and now hereby agree and stipulate to the following:

1. This covenant is an integral part of an enforceable agreement [an employment agreement] and the covenants contained herein were made at the time this agreement was consummated by the parties hereto.

2. This covenant is fair and reasonable in its:

a. geographical area;

b. length of time; and

c. scope of activity being restrained.

12.2 Employee expressly agrees that while this Agreement is in effect, and for a period of ________ years following termination of this agreement, Employee will not directly or indirectly as an employee, agent, proprietor, partner, broker, stockbroker, stockholder, officer, director, or otherwise use special knowledge or training or divulge trade secrets to any person or to any competitive business that would compete directly or indirectly with Employer’s business without prior consent of Employer.

12.3 Furthermore, during the term of this agreement, Employee shall not engage in any activity, employment or capacity either directly or indirectly, as a partner, shareholder, owner, or otherwise in the management and operation of [specify type of business or particular named business].


13.1 The effective date of this Agreement shall be the date endorsed on Schedule A to this agreement in the space provided therefor.


14.1 The Waiver by Employer of a breach of any provision of this agreement by Employee shall not operate or be construed as a waiver of any subsequent breach by Employee.


15.1 The rights and obligations of Employer under this agreement shall inure to the benefit of and shall be binding upon the successors and assigns of Employer.


16.1 Parties Bound. This Agreement shall be binding on and inure to the benefit of the parties and their respective heirs, executors, administrators, legal representatives, successors and assigns.

16.2 Assignment. Employee shall have no right to transfer or assign Employee’s interest in this Agreement without the prior written consent of Employer.

16.3 Corporate Authority. If any party to this Agreement is a legal entity (partnership, corporation and/or trust), that party represents to the other that this Agreement, the transaction contemplated in this Agreement, and its execution and delivery, have been duly authorized by all necessary partnership, corporate, or trust proceedings and actions, including without limitation action on the part of the directors, if the party is a corporation. Certified copies of the corporate or other resolutions authorizing this transaction shall be delivered at execution.

16.4 Time limits. Time is of the essence in this Agreement; and all time limits shall be strictly construed and rigidly enforced.

16.5 No Waiver. A failure or delay in the enforcement of the rights detailed in this Agreement by Employer shall not constitute a waiver of those rights or be considered a basis for estoppel. Employer may exercise its rights under this Agreement despite any delay or failure to enforce those rights.

16.6 Dispute or Contest. In the unlikely event that a dispute occurs or an action in law or equity arises out of the operation, construction, or interpretation of this Agreement, Employee shall bear the expense of the attorneys’ fees and costs incurred by Employer in the action.

16.7 Paragraph Headings. The paragraph headings used in this Agreement are descriptive only and shall have no legal force or effect whatever.

16.8 Use of Pronouns. The use of the neuter, masculine, or singular to refer to a party described in this Agreement shall be deemed a proper reference whether the party is an individual, a partnership, a corporation, or a group of two or more individuals, partnerships, or corporations. The grammatical changes required to make the provisions of this Agreement applicable to, corporations, partnerships, individuals, or groups of individuals, or to females as well as males shall in all instances be assumed as though in each case fully expressed.

16.9 __________ Law. This Agreement shall be subject to and governed by the laws of the State of __________. All obligations or payments are due and payable in, [Name of County] County, __________.

16.10 Severability. If any provision of this agreement shall, for any reason, be held violative of any applicable law, and so much of the Agreement is held to be unenforceable, then the invalidity of such a specific provision of this Agreement shall not be deemed to invalidate any other provisions of this Agreement, which other provisions shall remain in full force and effect unless removal of the invalid provisions destroy the legitimate purposes of this Agreement, in which event this Agreement shall be canceled.

16.11 Entire Agreement. This Agreement represents the entire agreement by and between the parties, except as otherwise provided in this Agreement, and it may not be changed except by written amendment duly executed by all parties.

16.12 Claims. All claims of Employee for compensation owed will be waived by Employee if not claimed within 30 days from the date of the termination of this Agreement.

16.13 Damages. In the event of a breach of this Agreement by Employee resulting in damages to Employer, Employer may recover from Employee such damages as Employer has sustained.

SIGNED, accepted and agreed to on ______________________, by the undersigned parties who hereby acknowledge that they have read and understood this Agreement and the Attachments thereto, and that they execute this legal document voluntarily and of their own free will.