**Exhibit 10.1**

 

**EMPLOYMENT AGREEMENT**

 

AGREEMENT made as of the 1st day of January, 2006 by and between PatrickD. Matthews, residing at 8702 Phoenix Avenue, Universal City, Texas 78148 (hereinafterreferred to as the “Employee”) and PBS Holding, Inc., a Nevada corporationwith principal offices located at 433 Kitty Hawk Drive, Suite 226,Universal City, Texas 78148.

 

**W I T N ES S E T H****:**

 

WHEREAS, PBS Holding, Inc. and its subsidiaries (together referredto as the “Company”) are engaged in the business of assisting clientsto cost effectively outsource the management of human resources includingemployee benefits, payroll and workers compensation, and operating professionalemployer organizations and temporary staffing services; and

 

WHEREAS, the Company desires to employ the Employee for the purpose ofsecuring for the Company the experience, ability and services of the Employee;and

 

WHEREAS, the Employee desires to accept employment with the Companypursuant to the terms and conditions herein set forth, superseding all priororal and written employment agreements and term sheets and letters between theCompany, its subsidiaries and/or predecessors and Employee.

 

NOW, THEREFORE, it is mutually agreed by and between the parties heretoas follows:

 

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**ARTICLE I**

 

**DEFINITIONS**

 

1.1           *AccruedCompensation.   *Accrued Compensation shall mean anamount which shall include all amounts earned or accrued through the “TerminationDate” (as defined below) but not paid as of the Termination Date, including (i) BaseSalary, (ii) reimbursement for business expenses incurred by the Employeeon behalf of the Company, pursuant to the Company’s expense reimbursementpolicy in effect at such time, (iii) automobile allowance, (iv) discretionarytime and vacation pay, and (v) bonuses and incentive compensation earnedand awarded prior to the Termination Date.

 

1.2           *Base Salary*.*   *“Base Salary” shall mean the greater ofthe Employee’s annual base compensation (a) at the rate in effect on theTermination Date or (b) at the highest rate in effect at any time duringthe ninety (90) day period prior to the Termination Date; provided however,Base Salary shall not include the Bonus or any other payment contingent onperformance. Base Salary shall be paid to the Employee in regular installmentson each of the Company’s regular pay dates for executives and subject to allapplicable tax withholding as provided in Section 4.4 hereof.

 

1.3           *Cause*.*   *Cause shall mean: (i) willful failureby the Employee of a reasonable and lawful instruction of the Board ofDirectors of the Company consistent with the duties and functions of Employee’sposition which failure is not cured within 15 days following written noticethereof; (ii) conviction of the Employee of any misdemeanor involvingfraud or embezzlement or a similar crime, or any felony; (iii) fraud,gross negligence or willful misconduct in the performance of his duties to theCompany; or (iv) excessive absences from work, other than for illness orDisability; provided that the Company shall not have the right to terminate theemployment of Employee pursuant to the foregoing clauses (i), (iii) and (iv) aboveunless written notice specifying such breach, as determined by a resolution ofthe Board of

 

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Directors, shall have beengiven to the Employee and, in the case of breach which is capable of beingcured, the Employee shall have failed to cure such breach within thirty (30)days after his receipt of such notice.

 

1.4           *Continuation Benefits.**   *ContinuationBenefits shall be the continuation of the Benefits, as defined in Section 5.1,for the period from the Termination Date to either (i) the later of theExpiration Date, or the end of the month in which the final Severance Paymentinstallment is payable pursuant to this Agreement, or (ii) such otherperiod as specifically stated by this Agreement (the “Continuation Period”), atthe Company’s expense on behalf of the Employee and his dependents; provided,however, that the benefits required to be provided during the ContinuationPeriod with respect to any benefit plan not available to non-employees of theCompany, shall be such benefits as shall be reasonably available andsubstantially similar to the benefits provided to employees of the Company onthe Termination Date. The Company’s obligation hereunder with respect to theforegoing benefits shall also be limited to the extent that if the Employeeobtains any such benefits pursuant to a subsequent employer’s benefit plan, theCompany may reduce the coverage of any benefits it is required to providethe Employee hereunder as long as the aggregate coverage and benefits of thecombined benefit plans is no less favorable to the Employee than the coverageand benefits required to be provided hereunder. This definition of ContinuationBenefits shall not be interpreted so as to limit any benefits to which theEmployee, his dependents or beneficiaries may be entitled under any of theCompany’s employee benefit plans, programs or practices following the Employee’stermination of employment, including, without limitation, retiree medical andlife insurance benefits.

 

1.5           *Disability*.*   *Disabilityshall mean a physical or mental impairment that substantially limits theEmployee’s ability to substantially perform his duties with the Company

 

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for a period of ninety (90)consecutive days, and the Employee has not returned to his full-timeemploymentprior to the Termination Date as stated in the “Notice of Termination” (asdefined below).

 

1.6           *Notice ofTermination*.*   *Noticeof Termination shall mean a written notice from the Company, or the Employee,of termination of the Employee’s employment which indicates the specifictermination provision in this Agreement relied upon, if any, and which setsforth in reasonable detail the facts and circumstances claimed to provide abasis for termination of the Employee’s employment under the provision soindicated.

 

1.7*           Severance Payment*.*   *Severance Payment shall mean an amountequal to 12 months of Base Salary (“Severance Payments”) payable in equalinstallments on each of the Company’s regular pay dates for executives duringsuch 12 month period commencing on the first regular executive pay datefollowing the Termination Date. For purposes of computing the SeverancePayment, Base Salary shall include any automatic increases to Base Salary towhich the Employee would have been entitled had this Agreement not beenterminated.

 

1.8           *TerminationDate*.*   *TerminationDate shall mean (i) in the case of the Employee’s death, his  date of death; (ii) in the case oftermination of employment after the Expiration Date, the last day ofemployment; and (iii) in all other cases, the date specified in the Noticeof Termination; provided, however, if the Employee’s employment is terminatedby the Company for any reason except Cause, the date specified in the Notice ofTermination shall be at least 30 days from the date the Notice of Terminationis given to the Employee, and provided further that in the case of Disability,the Employee shall not have returned to the full-time performance of his dutiesduring such period of at least 30 days.

 

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1.9           *Fiscal Year.   *FiscalYear shall mean the twelve-month period beginning on January and ending onDecember 31.

 

**ARTICLE II**

 

**EMPLOYMENT**

 

2.1           Upon the terms and subjectto conditions of this Agreement, the Company hereby employs and agrees tocontinue the employment of the Employee, and the Employee hereby accepts suchcontinued employment in his capacity as President and Chief Executive Officer. 

 

**ARTICLE III**

 

**DUTIES**

 

3.1           The Employee shall,during the Term of his employment with the Company (as defined in Section 8.1hereof), and subject to the direction and control of the Company’s Board ofDirectors, perform such duties and functions as he may be called uponto perform by the Company’s Board of Directors during the Term of thisAgreement, consistent with his position as President and Chief Executive Officer.

 

3.2           The Employee agrees todevote full business time and his best efforts in the performance of his dutiesfor the Company and any subsidiary of the Company.

 

3.3           Employee shallundertake regular travel to the Company’s executive and operational offices,and such other occasional travel within or outside the United States as is or may bereasonably necessary in the interests of the Company. All such travel shall beat the sole cost and expense of the Company.

 

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**ARTICLE IV**

 

**COMPENSATION**

 

4.1           During the Term (asdefined in Section 8.1) of this Agreement, Employee shall be compensatedper annum a base salary (“Base Salary”) initially at the rate of the greater of(i) $250,000 or (ii) 1.2% of the total gross revenues of the Companyfor the previous Fiscal Year ending December 31, not to exceed $400,000 inany Fiscal Year during the Term, subject to such increases to be determined bythe Board of Directors, or if the Board so designates, the CompensationCommittee of the Board of Directors, in its discretion, at the commencement ofeach Fiscal Year of the Company during the Term hereof. At the beginning ofeach Fiscal Year, the Board of Directors of the Company shall determine thefiscal strength and budgetary needs of the Company and determine what portionof the Base Salary will be payable in cash and what portion will be payable inoptions to purchase the Company’s common stock, par value $.001 (“Common Stock”)pursuant to the Company’s 2004 Stock Option Plan (“Option Plan”); providedhowever, that in no event will the cash portion of the Base Salary be less than$150,000 in any Fiscal Year. If the Board of Directors determines that aportion of the Base Salary will be payable in options to purchase Common Stock,the number of options issuable shall be equal to (i) the amount of BaseSalary reserved for options divided by (ii) the average of the closingsales prices for the last five (5) trading days on which actual salesoccurred during the previous calendar year (collectively, the “Options Issuedin Lieu of Base Salary”). The Options Issued in Lieu of Base Salary shall beissued by the Company to the Employee in 12 equal monthly installments of suchOptions on the last business day of each calendar month. In the event the Companycompletes an acquisition of any business or assets in any Fiscal Year, forpurposes of this Section 4.1, the Company shall exclude from grossrevenues of the Company for such applicable Fiscal Year the gross revenuesrelated to such acquired business or assets.

 

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4.2           Employee shall beeligible to receive a bonus (the “Bonus”) in the discretion of the Board ofDirectors, or if the Board so designates, the Compensation Committee of theBoard of Directors based on the annual financial and operating performance ofthe Company. Employee will have an opportunity to earn a Bonus for each Fiscal Yearof employment equal to the following;

 

(i)            $1,000 for each wholepercentage point increase of the gross revenues of the Company for such Fiscal Yearover the gross revenues of the Company for the previous Fiscal Year; providedthat in no event shall the Bonus payable with respect to this subsection (i) exceed$50,000 for any Fiscal Year of employment hereunder; and provided, further,that in the event the Company completes an acquisition of any business orassets in any Fiscal Year, for purposes of this Section 4.2(i), theCompany shall exclude from gross revenues of the Company for the Fiscal Year inwhich such acquisition occurs the gross revenues related to such acquiredbusiness or assets.

 

 (ii)          $1,000for each whole percentage point increase of the net income of the Company forsuch Fiscal Year over the net income of the Company for the previous Fiscal Year;provided that in no event shall the Bonus payable with respect to thissubsection (ii) exceed $100,000 for any Fiscal Year of employmenthereunder; and provided, further, that in the event the Companycompletes an acquisition of any business or assets in any Fiscal Year, forpurposes of this Section 4.2(i), the Company shall exclude from net incomeof the Company for the Fiscal Year in which such acquisition occurs the netincome related to such acquired business or assets.

 

(iii)          The Bonus payable undersubsection (i) or (ii) shall be payable not later than the lastday of the first calendar quarter following the Fiscal Year applicable to suchBonus. At the

 

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sole discretion of the Board ofDirectors of the Company, or if the Board so designates the CompensationCommittee of the Board of Directors, the Bonus payable under subsection (i) or(ii) above may be payable in cash or (ii) in grants of optionsto purchase shares of Common Stock pursuant to the Option Plan in the amountsand at exercise prices as determined by the Board of Directors, or if the Boardso designates, the Compensation Committee of the Board of Directors. Suchoptions shall be vested on the date of grant.

 

4.3           Employee shall also beeligible to receive a bonus from time to time upon the closing of anacquisition or business combination (each, an “Acquisition Bonus”) equal to tenpercent (10%) of the gross revenues of the acquired entity based upon the lastannual audited financial statements of such acquired entity, provided that inno event shall any such Acquisition Bonus payable with respect to this Section 4.3exceeds $500,000. Each such Acquisition Bonus shall be payable to Employeewithin 90 calendar days following the closing of the applicable acquisition orbusiness combination. Each Acquisition Bonus shall be payable under this Section 4.3in grants of options to purchase shares of Common Stock in amounts and exerciseprices as determined by the Board of Directors, or if the Board so designates,the Compensation Committee of the Board Directors. Such options shall be vestedon the date of grant.

 

4.4           The Company shalldeduct from Employee’s compensation all federal, state, and local taxes, whichit may now or may hereafter be required to deduct.

 

4.5           Employee may receivesuch other additional compensation as may be determined from time to timeby the Board of Directors including bonuses other than as specified in Sections4.2 and 4.3 and other long term compensation plans. Nothing in this Section 4.5shall be deemed or construed to require the Board to award any bonus oradditional compensation.

 

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**ARTICLE V**

 

**BENEFITS**

 

5.1           During the Term hereof,the Company shall provide Employee with the following benefits (the “Benefits”):(i) group health care and insurance benefits as generally made availableto the Company’s senior management; and (ii) such other insurance benefitsobtained by the Company and made generally available to the Company’s senior management.

 

5.2           During the Term hereof,the Company will provide an automobile for Employee’s use. The Employee shall receivean expense allowance for such automobile equal to five percent (5%) of Employee’sBase Salary, provided that such allowance shall not exceed $15,000 in any FiscalYear for actual expenses to maintain such automobile, including withoutlimitation, gas and maintenance. In addition, the Company shall reimburseEmployee, upon presentation of appropriate vouchers and other suitable documentation,for other expenses incurred by Employee on behalf of the Company including butnot limited to, the cost and use of a cell phone, beeper or pager, travelexpenses for transportation, lodging, meals and entertainment, and otherreasonable expenses necessary to perform Employee’s duties for the Company.

 

5.3           In the event theCompany wishes to obtain Key Man life insurance on the life of Employee,Employee agrees to cooperate with the Company in completing any applicationsnecessary to obtain such insurance and promptly submit to such physicalexaminations and furnish such information as any proposed insurance carrier may request.

 

5.4           During the Term hereof,Employee shall be entitled to paid vacation at the rate of four (4) weeksper annum based upon Employee’s Base Salary then in effect.

 

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5.5           In the event that anyexpenses paid by the Company are deemed to be income to Employee pursuant toany rules and regulations of the Internal Revenue Service such expenseswill be provided to Employee in addition to and not part of Employee’sBase Salary.

 

**ARTICLE VI**

 

**NON-DISCLOSURE**

 

6.1           The Employee shall not,at any time during or after the termination of his employment hereunder, exceptwhen acting on behalf of and with the authorization of the Company, or whenrequired by law or legal process, or where appropriate in response toregulatory authorities, make use of or disclose to any person, corporation, orother entity, for any purpose whatsoever, any trade secret or otherconfidential information concerning the Company’s business, finances,marketing, computerized payroll, accounting and information business, personneland/or employee leasing business of the Company and its subsidiaries, includinginformation relating to any customer of the Company, or any other nonpublicbusiness information of the Company and/or its subsidiaries learned as aconsequence of Employee’s employment with the Company, except for informationavailable publicly or from other non-confidential sources  (collectively referred to as the “ProprietaryInformation”). The Employee acknowledges that Proprietary Information, as they may existfrom time to time, are valuable and unique assets of the Company, and thatdisclosure of any such information would cause substantial injury to theCompany. Proprietary Information shall cease to be Proprietary Information, asapplicable, at such time as such information becomes public other than throughdisclosure, directly or indirectly, by Employee in violation of this Agreement.

 

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6.2           If Employee isrequested or required (by oral questions, interrogatories, requests forinformation or document subpoenas, civil investigative demands, or similarprocess) to disclose any Proprietary Information,  Employee shall, unless prohibited by law,promptly notify the Company of such request(s) so that the Company may seekan appropriate protective order.

 

**ARTICLE VII**

 

**RESTRICTIVE COVENANT**

 

7.1           In the event of thetermination of employment with the Company at any time prior to the expirationof the Term hereof, or Employee’s discharge in accordance with Article IX,or the expiration of the Term hereof without renewal, Employee agrees that hewill not, for period of one (1) year following such termination, directlyor indirectly, enter into or become associated with or engage in any otherbusiness  (whether as a partner, officer,director, shareholder, employee, consultant, or otherwise), which business isprimarily involved in assisting clients to cost effectively outsource human resourcesrequirements and operating professional employer organizations or temporarystaffing services, or is otherwise engaged in the same business as the Companyin direct competition with the Company in the geographic locations where theCompany currently conducts business or in geographic locations where theCompany was in the process of developing potential business relationships,during the tenure of Employee’s employment by the Company. Notwithstanding theforegoing, the ownership by Employee of less than five percent (5%) of theshares of any publicly held corporation shall not violate the provisions ofthis Article VII.

 

7.2           In furtherance of theforegoing, Employee shall not during the aforesaid period of non-competition,directly or indirectly, in connection with any business primarily involved in

 

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assisting clients to costeffectively outsource human resources requirements and operating professionalemployer organizations or temporary staffing services, or any business similarto the business in which the Company was engaged, or in the process ofdeveloping during Employee’s tenure with the Company, solicit any customer oremployee of the Company who was a customer or employee of the Company duringthe tenure of his employment.

 

7.3           Except as otherwise may beagreed by the Company in writing, in consideration of the employment ofEmployee by the Company, and free of any additional obligations of the Companyto make additional payment to Employee, Employee agrees to irrevocably assignto the Company any and all inventions, software, manuscripts, documentation,improvements or other intellectual property whether or not protectable by anystate or federal laws relating to the protection of intellectual property,relating to the present or future business of the Company that are developed byEmployee prior to the termination of his/her employment with the Company,either alone or jointly with others, and whether or not developed during normalbusiness hours or arising within the scope of his/her duties of employment. Employeeagrees that all such inventions, software, manuscripts, documentation,improvement or other intellectual property shall be and remain the sole andexclusive property of the Company and shall be deemed the product of work forhire. Employee hereby agrees to execute such assignments and other documents asthe Company may consider appropriate to vest all right, title and interesttherein to the Company and hereby appoints the Company as Employee’sattorney-in-fact with full powers to execute such document itself in the event Employeefails or is unable to provide the Company with such signed documents. Notwithstandingthe foregoing, this provision does not apply to an invention for which noequipment, supplies, facility, or trade secret information of the Company

 

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was used and which wasdeveloped entirely on Employee’s own time, unless (a) the inventionrelates (i) to the business of the Company, or (ii) to the Company’sactual or demonstrably anticipated research or development, or (b) theinvention results from any work performed by Employee for the Company.

 

7.4           If any court shall holdthat the duration of non-competition or any other restriction contained in thisArticle VII is unenforceable, it is our intention that same shall notthereby be terminated but shall be deemed amended to delete therefrom suchprovision or portion adjudicated to be invalid or unenforceable or, in thealternative, such judicially substituted term may be substituted therefor.

 

**ARTICLE VIII**

 

**TERM**

 

8.1           This Agreement shall befor a term (the “Term”) commencing on January 1, 2006 (the “CommencementDate”) and terminating on December 31, 2011 (the “Expiration Date”),unless sooner terminated upon the death of the Employee, or as otherwiseprovided herein.

 

8.2           Unless this Agreementis earlier terminated pursuant to the terms hereof, the Company agrees to useits best efforts to notify Employee in writing whether it intends to negotiatea renewal of this Agreement six (6) months prior to the Expiration Date.

 

8.3           Upon termination of theEmployee’s employment by the Company on or after the Expiration Date for anyreason except Cause, the Company shall pay Employee, in addition to any otherpayments due hereunder, the Severance Payment.

 

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**ARTICLE IX**

 

**TERMINATION**

 

9.1           The Company may terminatethis Agreement by giving a Notice of Termination to the Employee in accordancewith this Agreement for the following reasons:

 

a.             for Disability; or

 

b.             forCause.

 

9.2           Employee may terminatethis Agreement by giving a Notice of Termination to the Company in accordancewith this Agreement, at any time. If the Employee voluntarily terminates thisAgreement, the Company shall pay and/or provide to the Employee, his AccruedCompensation.

 

9.3           If the Employee’semployment with the Company shall be terminated, the Company shall pay and/orprovide to the Employee the following compensation and benefits in lieu of anyother compensation or benefits arising under this Agreement or otherwise:

 

a.             ifthe Employee was terminated by the Company for Cause,  the Accrued Compensation;

 

b.             ifthe Employee was terminated by the Company for Disability, the AccruedCompensation, the Severance Payment and the Continuation Benefits; or

 

c.             iftermination was due to the Employee’s death, the Accrued Compensation; or

 

d.             iftermination was due if the Employee was terminated by the Company prior to theExpiration Date without Cause, (i) the Accrued Compensation;  (ii)  the greater of (A) the BaseSalary to the Expiration Date, or (B) the Severance Payment;  and (iii)  the Continuation Benefits.

 

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9.4           The amounts payableunder this Section 9, shall be paid as follows:

 

a.             AccruedCompensation shall be paid within five (5) business days after theEmployee’s Termination Date (or earlier, if required by applicable law).

 

b.             Ifthe Continuation Benefits are paid in cash, the payments shall be made on thefirst day of each month during the Continuation Period (or earlier, if requiredby applicable law).

 

c.             TheSeverance Payments shall be paid in accordance with the Company’s regular payperiods (or earlier, if required by applicable law).

 

9.5           The Employee shall notbe required to mitigate the amount of any payment, including the value of anyContinuation Benefit, provided for in this Agreement by seeking otheremployment or otherwise and no such payment shall be offset or reduced by theamount of any compensation or benefits provided to the Employee in anysubsequent employment except as provided in Sections 1.4.

 

9.6           Employee agrees that aslong as Employee is entitled to receive any payments under this Agreement,Employee will not make any negative or derogatory statements in verbal,written, electronic or any other form about the Company, including, butnot limited to, a negative or derogatory statement made in, or in connectionwith, any article or book, on a website, in a chat room or via theinternet except where such statement is required by law or regulation.

 

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**ARTICLE X**

 

**TERMINATION OF PRIOR AGREEMENTS**

 

10.1         This Agreement, and anystock option, bonus plan and benefit plan described herein,  sets forth the entire agreement between theparties and supersedes all prior agreements, letters and understandings betweenthe parties, whether oral or written prior to the effective date of thisAgreement.

 

**ARTICLE XI**

 

**ARBITRATION AND INDEMNIFICATION**

 

11.1         Any dispute arising outof the interpretation, application, and/or performance of this Agreement withthe sole exception of any claim, breach, or violation arising under Articles VIor VII hereof shall be settled through final and binding arbitration before asingle arbitrator in the State of Texas in accordance with the Rules ofthe American Arbitration Association. The arbitrator shall be selected by theAssociation and shall be an attorney-at-law experienced in the field ofcorporate law. Any judgment upon any arbitration award may be entered inany court, federal or state, having competent jurisdiction of the parties.

 

11.2         The Company hereby agreesto indemnify, defend, and hold harmless the Employee for any and all claimsarising from or related to his employment by the Company at any time asserted,at any place asserted, to the fullest extent permitted by law. The Companyshall maintain such insurance as is necessary and reasonable to protect theEmployee from any and all claims arising from or in connection with hisemployment by the Company during the term of Employee’s employment with theCompany and for a period of six (6) years after the date of termination ofemployment for any reason. The provisions of this Section 11.2 are inaddition

 

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to and not in lieu of anyindemnification, defense or other benefit to which Employee may beentitled by statute, regulation, common law or otherwise.

 

**ARTICLE XII**

 

**SEVERABILITY**

 

If any provision of this Agreement shall be held invalid andunenforceable, the remainder of this Agreement shall remain in full force andeffect. If any provision is held invalid or unenforceable with respect toparticular circumstances, it shall remain in full force and effect in all othercircumstances.

 

**ARTICLE XIII**

 

**NOTICE**

 

For the purposes of this Agreement, notices and all othercommunications provided for in the Agreement shall be in writing and shall bedeemed to have been duly given when (a) personally delivered or (b) sentby  (i) a nationally recognizedovernight courier service or (ii) certified mail, return receiptrequested, postage prepaid and in each case addressed to the respectiveaddresses as set forth below or to any such other address as the party toreceive the notice shall advise by due notice given in accordance with thisparagraph. All notices and communications shall be deemed to have been receivedon (A) if delivered by personal service, the date of delivery thereof; (B) ifdelivered by a nationally recognized overnight courier service, on the firstbusiness day following deposit with such courier service; or (C) on thethird business day after the mailing thereof via certified mail. Notwithstandingthe foregoing, any notice of change of address shall be effective only uponreceipt.

 

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The current addresses of the parties are as follows:

 
| IF TO THE COMPANY:  | PBS Holdings, Inc.              |
|---------------------|--------------------------------------|
|                | 433 Kitty Hawk Drive, Suite 226 |
|                | Universal City, TX 78148             |
|                |                                 |
| WITH A COPY TO:     | Stanley R. Goldstein, Esq.      |
|                | Goldstein & DiGioia, LLP    |
|                | 45 Broadway, 11th Floor              |
|                | New York, NY 10006                   |
|                |                                 |
| IF TO THE EMPLOYEE: | Patrick D. Matthews                  |
|                | 8702 Phoenix Avenue                  |
|                | Universal City, TX 78148             |

 

 

**ARTICLE XIV**

 

**BENEFIT**

 

This Agreement shall inure to, and shall be binding upon, the partieshereto, the successors and assigns of the Company, and the heirs and personalrepresentatives of the Employee.

 

**ARTICLE XV**

 

**WAIVER**

 

The waiver by either party of any breach or violation of any provisionof this Agreement shall not operate or be construed as a waiver of anysubsequent breach of construction and validity.

 

**ARTICLE XVI**

 

**GOVERNING LAW**

 

This Agreement has been negotiated and executed in the State of Texas. Thelaw of the State of Texas shall govern the construction and validity of thisAgreement.

 

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**ARTICLE XVII**

 

**JURISDICTION**

 

Any or all actions or proceedings which may be brought by theCompany or Employee under this Agreement shall be brought in courts having asitus within the State of Texas, and Employee and the Company each herebyconsent to the jurisdiction of any local, state, or federal court locatedwithin the State of Texas.

 

**ARTICLE XVIII**

 

**ENTIRE AGREEMENT**

 

This Agreement contains the entire agreement between the parties hereto.No change, addition, or amendment shall be made hereto, except by writtenagreement signed by the parties hereto.

 

**IN WITNESS WHEREOF,**the parties hereto have executed this Agreement and affixed their signaturesthe day and year first above written.

 
| ** ** | **PBS Holding, Inc.** |
|------------|----------------------------|
|       |                       |
|       |                       |
|       | By:                        |   |   |
|       |                       |
| ** ** | ** **                 |
| ** ** | **Employee**               |
| ** ** | ** **                 |
| ** ** | ** **                 | ** ** |
|       | Patrick D. Matthews        |

 

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