Exhibit
10.35


 








 








EMPLOYMENT
AGREEMENT


 


THIS
EMPLOYMENT AGREEMENT (“Agreement”) is made, entered into, and effective as of April 15, 2019 (the “Effective
Date”), by and between Cipherloc Corporation a Texas Corporation, with its principal place of business located at 825 Main
Street, Suite 100 Buda, TX 78610 (“Company”), and James W. Sullivan an individual located at 6469 Almaden Expressway,
Suite 80-129, San Jose, CA 95120, (“Employee”) (individually, a “Party”; collectively, the “Parties”).


 


RECITALS


 


WHEREAS,
Company desires to employ Employee, and Employee desires to be employed as Chief Financial Officer, and;


 


WHEREAS,
Company desires to have an employment agreement with Employee as its Chief Financial Officer, subject to the terms and conditions
of this Agreement, and;


 


WHEREAS,
Company and Employee understand and agree that Employee shall work on a half time basis for the first ninety (90) days or
less from Employee’s home office.


 


NOW,
THEREFORE, in consideration of the mutual covenants and conditions contained herein, the Parties hereto hereby agree as follows:


 


AGREEMENT


 


1.
Term of Employment.


 


a.
Specified Period. Company hereby employs Employee and Employee accepts employment with Company for a period of three years
beginning on April 15, 2019 and terminating on April 15, 2022.


 


b.
Renewal. This Agreement is subject to automatic renewal upon the same terms and conditions as set forth herein, unless
either this Agreement is terminated pursuant to Section 8 hereof or a Party gives written notice to the other Party of its intent
to terminate, at least 30 days prior to expiration of the then-current term.


 


c.
Employment Term Defined. “Employment term” refers to the entire period of employment of Employee by Company,
whether for the period provided above, or whether terminated earlier as hereinafter provided or extended by mutual agreement between
Company and Employee.


 




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2.
Duties and Obligations of Employee.


 


Employee
shall serve as Chief Financial Officer and shall report to the President. Employee may work from his home office. Employee shall
faithfully and diligently perform all services and duties as may be requested and required of Employee by the President. Employee
shall devote such time and attention on an exclusive basis to oversee the Company’s Financial and Accounting operations.
Employee at all times during the employment term shall strictly adhere to and obey all policies, rules and regulations established
from time to time governing the conduct of employees of the Company.


 


3.
Exclusivity, Non-Disclosure.


 


a.
Devotion to Company Business. Employee agrees to perform Employee’s services efficiently and to the best of Employee’s
ability. Employee agrees throughout the term of this Agreement to devote his time, energy and skill to the business of the Company
and to the promotion of the best interests of the Company.


 


b.
Trade Secrets. Employee agrees that he shall not at any time, either during or subsequent to his employment term, unless
expressly consented to in writing by Company, either directly or indirectly use or disclose to any person or entity any confidential
information of any kind, nature or description concerning any matters affecting or relating to the business of Company, including,
but not limited to, information concerning the customers of Company, Company’s marketing methods, compensation paid to employees,
independent contractors or suppliers and other terms of their employment or contractual relationships, financial and business
records, know-how, or any other information concerning the business of Company, its manner of operations, or other data of any
kind, nature or description. Employee agrees that the above information and items are important, material and confidential trade
secrets and these affect the successful conduct of Company’s business and its goodwill.


 


c.
Inventions and Patents. Employee agrees to disclose and to assign immediately to the Company, or to any persons designated
by the Company, or at the Company’s option, any of the Company’s successors or assigns, all inventions or improvements
which are or were made, conceived or reduced to practice by Employee, whether acting independently or with others, during the
course of Employee’s employment with the Company, and which (i) were made, conceived of or first reduced to practice in
the performance of any duties assigned to or undertaken by the Employee as an employee of the Company; or (ii) were made, conceived
of or first reduced to practice with the use of the Company’s time, material, facilities or funds.


 


d.
Third Party Information. Employee recognizes that the Company has received and, in the future, will receive from third
parties their confidential or proprietary information subject to a duty on the Company’s part to maintain the confidentiality
of such information and to use it only for certain limited purposes. Employee agrees to hold all such confidential or proprietary
information in the strictest confidence and not to disclose it to any person, firm or corporation or to use it except as necessary
in carrying out Employee’s work for the Company consistent with the Company’s agreement with such third party.


 




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e.
Conflicting Employment. Employee agrees that, during the term of his employment with the Company, Employee will devote
his full time and efforts to the Company, other than up to the first 90 days, and he will not engage in any other employment,
occupation or consulting activity, nor will Employee engage in any other activities that conflict with Employee’s obligations
to the Company without written consent of the Company.


 


f.
Solicitation of Employees. By executing this Employment Agreement Employee agrees that for a period of eighteen (18) months
immediately following the termination of Employee’s relationship with the Company for any reason, whether with or without
good cause or for any or no cause, at the option either of the Company or Employee, with or without notice, Employee will not
hire any employees of the Company and will not, either directly or indirectly, solicit, induce, recruit or encourage any of the
Company’s employees to leave their employment, or take away such employees, or attempt to solicit, induce, recruit, encourage
or take away employees of the Company, either for Employee or for any other person or entity.


 


g.
Noncompetition Covenants. Employee further agrees that during the period of employment by the Company and for a period
of two (2) years thereafter, regardless of the reason for the termination of such employment, Employee will not, directly or indirectly,
whether alone or as a partner, joint venture, officer, director, consultant, employee, independent contractor or stockholder of
any company or business organization, engage in any business activity and/or accept employment with any person or entity, which
is or may be directly or indirectly in competition with the products or services being marketed, promoted, distributed, developed,
planned, sold or otherwise provided by the Company. The ownership by Employee of not more than one percent of the shares of capital
stock of any corporation having a class of equity securities traded on a national securities exchange shall not be deemed, in
and of itself, to violate this section.


 


4.
Compensation.


 


	 	a.	Salary.
    Subject to the termination of this Agreement as provided herein, Company shall compensate Employee for his services hereunder
    at an annual salary of $250,000.00 and payable in accordance with the Company’s practices, less normal payroll deductions,
    and prorated for the actual employment term.
	 	 	 
	 	b.	Salary
    Increases; Bonuses. Employee shall receive such annual increases in salary and such additional compensation as may be
    determined by the Board of Directors of the Company in its sole discretion. Such salary increases and/or additional compensation
    shall be paid to Employee on the anniversary date of this Agreement during the Employment Term, and at such other times as
    may be determined by the Board of Directors. Bonuses shall not exceed $50,000.
	 	 	 
	 	c.	Stock.
    Common stock shall be granted to Employee pursuant to the 2019 Stock Option/Stock Issuance Plan and the value of the common
    stock granted/issued shall not exceed the Employee’s annual Salary. 


 




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5.
Employee Incentives. Employee shall be entitled to receive incentives including profit sharing, and any other incentive
plans that the Company has or will make available to similarly situated employees.


 


6.
Employee Benefits.


 


a.
Vacation. Employee will be entitled, during each employment year, to 120 hours of paid time off (PTO) for vacation and
sick leave up to a maximum number of hours equivalent to one year of hours available for accrual (120 hours). Employee may be
absent from his employment for PTO only at such times as may be convenient to Company and Employee. Once the maximum number of
hours is reached, all further accruals will cease. PTO accruals will recommence after time off is taken and the balance of accrued
hours is less than the maximum number of hours. b. Medical Coverage. Company agrees to include Employee in the coverage
of its medical and dental insurance plan.


 


c.
Plan Participation. Employee shall be entitled to participate in or to receive benefits under all of Company’s employee
benefit plans made available by Company or in the future to similarly situated employees, subject to the terms, conditions and
overall administration of such plans, including but not limited to 401(k) plans, IRA plans, E.R.I.S.A Plans, any other retirement
or benefit plans that the Company has made available to similarly situated employees.


 


7.
Business Expenses.


 


Employee
will be required to incur travel, meals, entertainment and other business expenses on behalf of the Company in the performance
of Employee’s duties hereunder. Company will reimburse Employee for all such reasonable business expenses incurred by Employee
in connection with Company’s business upon presentation of receipts or other acceptable documentation of the expenditures.
In compensating Employee for expenses, the ordinary and usual business guidelines and documentation requirements shall be adhered
to by Company and Employee.


 


8.
Termination of Employment.


 


(1)
Termination for Cause. For purposes of this Agreement, “Cause” shall mean the occurrence of any one of the
following events:


 


(a)
Employee’s material breach of any provision of this Agreement or of Executive Employee Confidentiality, Non-Competition
and Invention Assignment Agreement of even date herewith, entered into by and between the Company and Employee, which breach is
not cured within ten days after the Company provides Employee with written notice of the nature and existence of such material
breach;


 


(b)
Employee’s willful refusal to obey written directions of Employee’s supervisor of the Company (so long as such directions
do not involve illegal or immoral or otherwise improper acts), which refusal continues for a period of five business days after
notice to Employee by the Company, and which notice references such refusal and this Section 8.


 




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(c)
Employee’s failure to perform Employee’s duties and responsibilities with diligence and in accordance with the productivity
and quality requirements of the Company, which failure continues for a period of ten business days after written notice to Employee
by the Company of Employee’s failure to perform; provided, however, that if Employee has been provided written notice pursuant
to this Section 8 on two separate occasions during the Initial Term, any subsequent failure by Employee to perform Employee’s
duties and responsibilities in accordance with the Company’s requirements shall constitute Cause and the Company shall not
be required to provide any written notice or opportunity for Employee to correct Employee’s performance prior to a termination
of Employee’s employment by the Company;


 


(d)
Employee’s repeated refusal to comply with Company written policies or requirements which are adopted by the Board of Directors
from time to time and which apply to Employee’s responsibilities;


 


(e)
Employee’s action, or failure to act, in violation of any provision of the Company’s standard employee guidelines,
including but not limited to any policy concerning sexual harassment, substance abuse, as such policies may be in effect from
time to time, if such violation of the Company’s policy would generally result in the termination of employment of a Company
employee;


 


(f)
Fraud or dishonesty by Employee, in the good faith opinion of the Board of Directors of the Company; or


 


(g)
If Employee is convicted or admits to the commission of a criminal offense or act of moral turpitude that constitutes a felony
in the jurisdiction in which the offense is committed.


 


(h)
The notice of termination required by this section shall specify the ground for the termination and shall be supported by a statement
of all relevant facts.


 


(2).
Termination Upon Death or Disability.


 


i.
Death. This Agreement shall be terminated immediately upon the death of Employee.


 


ii.
Disability. Company reserves the right to terminate this Agreement if, due to illness or injury, either physical or mental,
Employee is unable to perform Employee’s customary duties as an employee of Company, unless reasonable accommodation can
be made to allow Employee to continue working, for more than 30 days in the aggregate out of a period of 12 consecutive months.
The disability shall be determined by a certification from a physician. Such a termination shall be effected by giving ten days’
written notice of termination to Employee. Termination pursuant to this provision shall not prejudice Employee’s rights
to receive disability insurance payments or the continued compensation pursuant to this Agreement.


 


iii.
Without cause. Termination under this section for either death or disability shall not be considered “for cause”
for the purposes of this Agreement.


 




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(3).
Effect of Merger, Change of Control, Transfer of Assets, or Dissolution. Without the prior written consent of Employee,
this Agreement shall not be terminated by any voluntary or involuntary dissolution of Company resulting from a merger, change
of control (greater than the transfer of 45% of voting securities or consolidation in which Company is not the consolidated or
surviving corporation), or a transfer of all or substantially all of the assets of Company. In the event of any such merger, change
of control or consolidation or transfer of assets, Employee’s rights, benefits, and obligations hereunder shall be assigned
to the surviving or resulting corporation or the transferee of Company’s assets, unless Employee agrees otherwise.


 


(4).
Payment on Termination. If Company terminates this Agreement “without cause,” it shall pay “Severance
Benefits” to the Employee. Severance Benefits shall mean, for purposes of this Agreement, a cash payment equal to the aggregate
compensation payable to the Employee during the remaining term of this Agreement, including all salary, commissions, bonuses and
other compensation. In the case of termination under section (8)(3), Severance Benefits will be, at a minimum, the value of Employee’s
then annual salary.


 


(5).
Termination by Employee.


 


i.
Without Cause. Employee may terminate this Agreement without cause upon 30 days’ prior written notice to Company.


 


ii.
With Cause. Employee may terminate this Agreement immediately with cause, in which event Employee shall receive the Payment
on Termination in accordance with Section 8(4) herein. For the purposes of this Agreement, “cause” for termination
by Employee shall be a breach of any material covenant or obligation hereunder; or the termination of this Agreement without the
prior written consent of Employee due to the voluntary or involuntary dissolution of the Company, any merger or consolidation
in which the Company is not the surviving or resulting corporation, or any transfer of all or subsequently all of the assets of
Company.


 


9.
General Provisions.


 


a.
Binding Effect. This Agreement shall be binding upon and inure to the benefit of the Parties hereto their respective devisees,
legatees, heirs, legal representatives, successors, and permitted assigns. The preceding sentence shall not affect any restriction
on assignment set forth elsewhere in this Agreement.


 




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b.
Notices. Any notice, request, instruction, or other document required by the terms of this Agreement, or deemed by any
of the Parties hereto to be desirable, to be given to any other party hereto shall be in writing and shall be given by personal
delivery, overnight delivery, mailed by registered or certified mail, postage prepaid, with return receipt requested, or sent
by facsimile/electronic transmission to the addresses of the Parties as follows:


 


To
Company:


 


Cipherloc
Corporation


825
Main Street, Suite 100


Buda,
TX 78610


Email:mdgl@Cipherloc.net


Attn:
President



 


To
Employee:


 


James
W. Sullivan


6469
Almaden Expressway


Suite
80-129


San
Jose, CA 95120


Email


 


The
persons and addresses set forth above may be changed from time to time by a notice sent as aforesaid. If notice is given by personal
delivery or overnight delivery in accordance with the provisions of this Section, such notice shall be conclusively deemed given
at the time of such delivery provided a receipt is obtained from the recipient. If notice is given by mail in accordance with
the provisions of this Section, such notice shall be conclusively deemed given upon receipt and delivery or refusal. If notice
is given by facsimile/electronic transmission in accordance with the provisions of this Section, such notice shall be conclusively
deemed given at the time of delivery if during business hours and if not during business hours, at the next business day after
delivery, provided a confirmation is obtained by the sender.


 


c.
Sums Due Deceased Employee. If Employee dies prior to the expiration of the employment term, any sums that may be due him
from Company under this Agreement as of the date of death shall be paid to Employee’s executors, administrators, heirs,
personal representatives, successors, and assigns.


 


d.
Assignment. Subject to all other provisions of this Agreement, any attempt to assign or transfer this Agreement or any
of the rights conferred hereby, by judicial process or otherwise, to any person, firm, Company, or corporation without the prior
written consent of the other Party, shall be invalid, and may, at the option of such other Party, result in an incurable event
of default resulting in termination of this Agreement and all rights hereby conferred.


 


e.
Choice of Law. This Agreement and the rights of the parties hereunder shall be governed by and construed in accordance
with the laws of the State of Texas including all matters of construction, validity, performance, and enforcement and without
giving effect to the principles of conflict of laws.


 


f.
Jurisdiction. The parties submit to the jurisdiction of the Courts of the State of Texas or a Federal Court impaneled in
the State of Texas for the resolution of all legal disputes arising under the terms of this Agreement.


 


g.
Indemnification. Company shall indemnify, defend and hold Employee harmless, to the fullest extent permitted by law, for
all claims, demands, losses, costs, expenses, obligations, liabilities, damages, recoveries and deficiencies, including interest,
penalties and reasonable attorney’s fees that Employee shall incur or suffer that arise from, result from or relate to the
discharge of Employee’s duties under this Agreement. Company shall maintain adequate insurance for this purpose or shall
advance Employee any expenses incurred in defending any such proceeding or claim to the maximum extent permitted by law.


 




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h.
Entire Agreement. Except as provided herein, this Agreement, including exhibits, contains the entire agreement of the Parties,
and supersedes all existing negotiations, representations, or agreements and all other oral, written, or other communications
between them concerning the subject matter of this Agreement. There are no representations, agreements, arrangements, or understandings,
oral or written, between and among the Parties hereto relating to the subject matter of this Agreement that are not fully expressed
herein.


 


i.
Severability. If any provision hereof is held to be illegal, invalid or unenforceable under present or future laws effective
during the term hereof, such provision shall be fully severable. This Agreement shall be construed and enforced as if such illegal,
invalid or unenforceable provision had never comprised a part hereof, and the remaining provisions hereof shall remain in full
force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance wherefrom. Furthermore,
in lieu of such illegal, invalid or unenforceable provision there shall be added automatically by the Company as a part hereof
a provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and legal, valid and enforceable.


 


j.
Captions. The captions in this Agreement are inserted only as a matter of convenience and for reference and shall not be
deemed to define, limit, enlarge, or describe the scope of this Agreement or the relationship of the Parties, and shall not affect
this Agreement or the construction of any provisions herein.


 


k.
Modification. No change, modification, addition, or amendment to this Agreement shall be valid unless in writing and signed
by all Parties hereto.


 


l.
Attorneys’ Fees. In the event any Party hereto shall commence legal proceedings against the other to enforce the
terms hereof, or to declare rights hereunder, as the result of a breach of any covenant or condition of this Agreement, the prevailing
Party in any such proceeding shall be entitled to recover from the losing Party its costs of suit, including reasonable attorneys’
fees, as may be fixed by the court.


 


m.
Taxes. Any income taxes required to be paid in connection with the payments due hereunder, shall be borne by the Party
required to make such payment. Any withholding taxes in the nature of a tax on income shall be deducted from payments due, and
the Party required to withhold such tax shall furnish to the Party receiving such payment all documentation necessary to prove
the proper amount to withhold of such taxes and to prove payment to the tax authority of such required withholding.


 


n.
Not for the Benefit of Creditors or Third Parties. The provisions of this Agreement are intended only for the regulation
of relations among the Parties. This Agreement is not intended for the benefit of creditors of the Parties or other third Parties
and no rights are granted to creditors of the Parties or other third Parties under this Agreement. Under no circumstances shall
any third party, who is a minor, be deemed to have accepted, adopted, or acted in reliance upon this Agreement.


 


o.
Counterparts. This Agreement may be executed in several counterparts and it shall not be necessary for each Party to execute
each of such counterparts, but when all of the parties have executed and delivered one of such counterparts, the counterparts,
when taken together, shall be deemed to constitute one and the same instrument, enforceable against each Party in accordance with
its terms.


 


p.
Facsimile Signatures. The parties hereto agree that this Agreement may be executed by facsimile signatures and such signatures
shall be deemed originals. The parties further agree that within ten days following the execution of this Agreement, they shall
exchange original signature pages.


 


IN
WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly executed as of the Effective Date.


 


	 	COMPANY:
	 	 	 
	 	Cipherloc
    Corporation, a Texas Corporation
	 	 	 
	 	/s/ Michael De La Garza
	 	By:	Michael
    De La Garza
	 	Its:	President/CEO
	 	 	 
	 	EMPLOYEE:
	 	 	 
	 	James
    W. Sullivan
	 	 	 
	 	/s/ James W. Sullivan
	 	By:	James
    W. Sullivan


 







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