Exhibit 10.5


 


GENUTEC BUSINESS SOLUTIONS, INC.


 


EXECUTIVE
EMPLOYMENT AGREEMENT


 


This EXECUTIVE
EMPLOYMENT AGREEMENT (the “Agreement”) is entered into as of September 2,
2005, by and between GenuTec Business Solutions, Inc., a Montana corporation
(the “Company”), and Edward P. Rutherford, an individual (“Executive”). The Company and Executive are referred
to herein collectively as the “Parties” and individually as a “Party.”


RECITALS


                A.            The
Company is creating a new business division called American Notification
Network (“ANN”).


                B.            Executive
has substantial experience in management and has significant knowledge of the
business, products and services offered by the Company and to be offered by ANN.


                C.            The
Company desires that Executive serve as the President and Chief Operating
Officer of ANN and be responsible for the management of ANN, and Executive
desires to serve as the President and Chief Operating Officer of ANN.


                D.            The
Company and Executive have agreed to enter into this Agreement upon the terms
and conditions set forth below.


AGREEMENT


                NOW, THEREFORE, in consideration of their mutual
undertakings, obligations and covenants, the Parties hereby agree as follows:


                1.             EMPLOYMENT
— TERM, DUTIES


                                1.1           Term.  Subject to the provisions of Section 4 herein,
the Company hereby employs Executive and Executive hereby accepts employment as
the President and Chief Operating Officer of ANN, to perform the duties
described below for a term commencing as of the date set forth above and
continuing for a period of two (2) years. 
This Agreement shall be automatically renewed for additional one (1)
year periods unless a Party gives written notice of non-renewal to any other
Party at least ninety (90) days prior to the end of the initial term or any
renewal term.


                                1.2           Duties.  Executive shall serve the Company in the
capacity of President and Chief Operating Officer of ANN and, subject to the
direction of the Chief Executive Officer and/or Board of Directors (the “Board”)
of the Company, shall perform and discharge well and faithfully those duties
customarily performed by a President and Chief Operating Officer of a business
similarly situated to that of ANN or which may otherwise be assigned from time
to time by the Company in connection with the conduct of ANN’s business.  Nothing herein shall preclude the Board and/or
the Chief Executive Officer of the Company from changing the duties of
Executive if the Board and/or the Chief Executive Officer of the Company concludes
in their discretion that such changes are in the best interests of the Company
and ANN.  If Executive is appointed or


 


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elected to serve as a director
or other officer of the Company or any subsidiary or division thereof during
the term of this Agreement, Executive will serve in such capacity without any
additional compensation, unless agreed to in writing by the Company and
Executive.


                2.             EXTENT
OF SERVICES


                                2.1           Executive
agrees to devote his entire working time, attention and energies to the
business of ANN and shall faithfully and diligently serve the interests of the
Company and ANN and during the term of this Agreement shall not be engaged
(whether or not during normal business hours) in any other substantial business
or professional activity, whether or not such activity is pursued for gain,
profit or other pecuniary advantage. 
Nothing contained herein shall prevent Executive from investing his
personal assets in businesses which do not compete with the Company and ANN and
in which his participation is solely that of an investor, or from purchasing
securities in any corporation whose securities are publicly-traded; provided
that, such purchase shall not result in Executive owning beneficially at any
time one percent (1%) or more of the outstanding securities of any corporation
engaged in activities competitive to that of the Company or ANN.


                3.             COMPENSATION,
FRINGE BENEFITS AND EXPENSES


                                3.1           Salary.  The base annual salary to be paid by the
Company to Executive for services rendered under this Agreement during the initial
two (2) year term shall be (i) $80,000 for the first year of service and (ii)
$120,000 for the second year of service, which amounts shall be payable to
Executive on a semi-monthly basis.  Each
semi-monthly payment shall be subject to all authorized and required payroll
deductions for taxes, social security and the like.  In addition, the Company shall grant
Executive options to purchase 100,000 shares of the Company’s common
stock.  Such options shall be subject to
the terms of the stock option plan under which they are granted and shall vest
as provided in the stock option agreement evidencing such options.  All compensation due Executive under the
terms of this Agreement shall be due and payable upon termination of Executive’s
employment as specified herein.


                                3.2           Vacation. 
Executive shall be entitled to a paid annual vacation as per the
Company’s Policy and Procedure manual. 
All vacation time shall be taken by Executive at times mutually agreed
upon by Executive and the Company.


                                3.3           Benefits.  During the term of his employment pursuant to
this Agreement, Executive shall be entitled to participate in all executive
benefit plans or programs instituted by the Company and in which all, or
substantially all, other salaried executives of the Company are entitled to
participate, including, but not limited to, group health insurance, short and
long term disability insurance.


                                3.4   
Company Travel Expenses. 
All reasonable expenses related to the business of the Company or ANN
incurred by Executive during the term of his employment shall be paid by the
Company, or reimbursed to Executive in the event Executive may have paid for
such expenses in advance, upon presentation of receipts for such expenses in
accordance with the Company’s expense reimbursement policies as established
from time to time.


 


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                4.             TERMINATION PRIOR TO EXPIRATION
OF TERM


                                4.1   
Breach or Neglect.  If
Executive breaches any term or provision of this Agreement or habitually
neglects the duties or obligations required of him under this Agreement, or for
other good cause, the Company may, at its sole option, terminate this Agreement
by giving written notice to Executive; provided, however, that in the event the
Company contends that Executive has breached or is not performing the services
required by this Agreement or that the Company has good cause to terminate
Executive’s employment pursuant to this Paragraph 4.1, the Company shall
provide Executive with a written notice specifying in reasonable detail the
breach, or the services or matters which the Company contends Executive has not
adequately performed, and explaining why the Company has good cause to
terminate this Agreement and what Executive should do to adequately perform his
obligations hereunder.  If Executive
remedies such breach or performs the required services within ten (10) business
days of receipt of the notice of breach or modifies his performance to correct
the matters complained of (if such breach is capable of cure or if such matters
can be corrected), Executive’s breach will be deemed cured and he shall not be
terminated.  If Executive does not remedy
such breach or perform the required services or modify his performance to
correct the matters complained of, the Company shall have the right to
immediately terminate this Agreement at the end of said ten (10) business day
period.  If such breach is not capable of
cure or such performance cannot be corrected, this Agreement shall be deemed
terminated immediately upon written notice to the Executive.


                                4.2           Business
Closure.  If either the Company or
ANN cease their respective businesses or are unable or not permitted to
continue their respective businesses for any reason, the Company may, at its
sole option, terminate this Agreement by giving written notice to Executive, without
any further obligation to Executive.


                                4.3           Disability.  If Executive becomes disabled during the term
of this Agreement and such disability continues for a period of ninety (90)
days, the Company may, at its sole option, on or after the expiration of such
ninety (90) day period, terminate this Agreement by giving written notice to
Executive.  While Executive is so
disabled, the Company shall pay to Executive his full monthly salary for the
first month and fifty percent (50%) of his monthly salary for the next five (5)
months as provided in Paragraph 3.1 above; provided that, such installments
shall be reduced by all amounts paid to Executive on account of any disability
insurance provided by the Company, or any workers’ compensation, social
security, or other payments made to Executive due to his disability; provided
further, that such payments by the Company shall cease upon the earlier of (a)
the expiration of the term of this Agreement or (b) the earlier termination of
this Agreement pursuant to Paragraphs 4.1 and 4.2 above.  For the purpose of this Agreement, the term “disabled”
shall be defined as Executive’s inability, through physical or mental illness
or other such cause, to perform substantially all of the duties which he is
required to perform under this Agreement. 
In determining whether Executive is disabled, the Company may rely upon
the written statement provided by a licensed physician acceptable to the
Company.  Executive shall allow himself
to be examined from time to time by any licensed physician selected by the
Company in relation to the disability.


                                4.4           Effect
of Termination.  If this Agreement is
terminated before the end of its then current term under the provisions of Paragraphs
4.1 or 4.2 above or because of Executive’s resignation, the Company shall pay
Executive only the base salary earned by him up to the date of termination and
the Company shall have no further obligation to Executive thereafter.  Any termination of Executive’s employment
shall be without prejudice to any right or remedy to which


 


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the Company may be entitled
whether at law, in equity, or under this Agreement.


                                4.5           Without
Cause.  Notwithstanding any other
paragraph of this Section 4, the Company shall have the right to terminate this
Agreement at any time during its term by written notice to that effect,
delivered to Executive, whereupon all salaries and benefits shall be paid by the
Company for the balance of the term of this Agreement.  Such sums shall be paid on a semi-monthly
basis during such period, in accordance with the Company’s normal payroll
policies and procedures; provided that, the Company’s obligation to pay such
amounts shall cease immediately upon Executive’s breach of the provisions of
Section 5 below.


                                4.6           Separate
Causes for Termination.  Except as
otherwise provided herein, the paragraphs in this Agreement providing for the
Company’s right to terminate this Agreement shall be interpreted wholly
independent from and without reference to one another.


                                4.7           Death
During Employment.  If Executive dies
during the term of his employment, the Company shall pay to the estate of
Executive the compensation which would otherwise be payable to Executive up to
the end of the period remaining under the terms and conditions of this
Agreement, and the Company shall have no further obligations under this
Agreement or otherwise in respect of Executive’s employment.  All back salary, if owed, would be due and
payable and all personal guarantees would be removed pursuant to Section 4.8
below.


                                4.8           Personal
Obligations and Compensation upon Termination.  In the event that Executive’s employment
shall be terminated as specified herein, the Company shall pay all back
salaries owed and remove him as personal guarantor for all obligations of the
Company and hold him harmless from any liability therefore.


                5.             NONDISCLOSURE
OF CONFIDENTIAL INFORMATION


                                5.1           Except
with the Company’s prior written consent, Executive agrees that he will not
disclose or use at any time, during the term of his employment with the Company
or thereafter, any Confidential Information of the Company.  For purposes of this Agreement, “Confidential
Information” includes, without limitation, all information which is known
or intended to be known only by executives of the Company or by persons who are
in a confidential relationship with the Company, including, without limitation,
trade secrets, proprietary information, unique processes, research or marketing
reports, operating techniques, licenses, trademarks and copyrights whether
provided to Executive by the Company or developed or discovered by him while at
the Company, and including further any such Confidential Information relating
to any customer, vendor, licensor, licensee or party transacting business with
the Company.


                                5.2           Executive
recognizes and acknowledges that the lists of the Company’s customers,
distributors, resellers and dealers as they may exist from time to time are
valuable, confidential, special and unique assets of the Company’s business in
the nature of a trade secret and Executive will not, during the term of this
Agreement or thereafter, disclose such lists or any part thereof to any person,
firm, corporation, association or entity for any purpose or reason whatsoever.


                                5.3           Executive
agrees to hold as the Company’s property, all memoranda, books, papers,
letters, formulae and other data and all copies thereof and information
generated therefrom,


 


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in any way relating to the
Company’s business and affairs, made by him or otherwise coming into his
possession, and at termination of his employment, or on demand of the Company
at any time, to deliver the same to the Company.


                6.             GENERAL
PROVISIONS


                                6.1           Notices.  All notices, requests, demands and other
communications to be given or sent pursuant to this Agreement shall be in
writing and shall be deemed to have been duly given when delivered by hand or
mailed by first class certified mail, return receipt requested, addressed as
follows:


	
  (a)

  	
   

  	
  if to the Company:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  GenuTec Business Solutions, Inc.

  
	
   

  	
   

  	
  6 A Liberty, Suite 200

  
	
   

  	
   

  	
  Aliso Viejo, CA 92656

  
	
   

  	
   

  	
  Attention: Lee Danna

  
	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  if to Edward R. Rutherford:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  16966 Round Valley Circle

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Grass Valley, CA 95949

  



 


The Parties
may change their addresses set forth above by notice to the other Parties given
in accordance with this Paragraph.


                                6.2           Severability.  If any provision of this Agreement shall, for
any reason, be adjudged by any court of competent jurisdiction to be invalid or
unenforceable, such judgment shall not effect, impair or invalidate the
remainder of this Agreement but shall be confined in its operation to the
provision of this Agreement directly involved in the controversy in which such
judgment shall have been rendered.


                                6.3           Attorney’s
Fees and Costs.  If any action at law
or in equity is necessary to enforce or interpret the terms of this Agreement,
the prevailing party shall be entitled to reasonable attorneys’ fees, costs,
and necessary disbursements in addition to any relief to which it may be
entitled.


                                6.4           Assignment.  This Agreement shall be binding upon and
inure to the benefit of the Company, its successors and assigns.  Because of the special, unique and
extraordinary character of Executive’s services, Executive may not assign all
or any part of his obligations under this Agreement.


                                6.5           Receipt
of Agreement.  Each Party hereto
acknowledges that it has read this Agreement in its entirety and does hereby
acknowledge receipt of a fully executed copy thereof.  A fully executed copy shall be an original
for all purposes, and is a duplicate original.


                                6.6           Governing
Law.  This Agreement shall be governed
by and construed in


 


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accordance with the laws of
the State of California.


                                6.7           Captions
and Paragraph Headings.  Captions and
paragraph headings used herein are for convenience and shall not affect the
construction of this Agreement.


                                6.8           Entire
Agreement.  This Agreement contains
the entire agreement between the Parties with respect to the employment of
Executive by the Company and supersedes all prior and contemporaneous
agreements, representations and understandings of the Parties, whether written
or oral.  No modification, amendment or
waiver of any of the provisions of this Agreement shall be effective unless in
writing signed by all Parties.


                                6.9           Waiver
of Breach.  The failure to enforce at
any time any of the provisions of this Agreement, or to require at any time
performance by any Party of any of the provisions hereof, shall in no way be
construed to be a waiver of such provisions or to affect either the validity of
this Agreement or any part hereof or the right of any Party thereafter to
enforce each and every provision in accordance with the terms of this
Agreement.


6.10         Agreement Prevails.  The Parties agree that in the event of any
conflict or inconsistency between the terms of this Agreement and the Company’s
personnel policies or procedures, the terms of this Agreement shall prevail.


[Signature
Page Follows]


 


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IN WITNESS WHEREOF, the Parties have executed
this Agreement as of the day and year first above written.


 


	
   

  	
   

  	
  EXECUTIVE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  EDWARD P. RUTHERFORD

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ Edward P. Rutherford

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  COMPANY

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  GENUTEC BUSINESS SOLUTIONS, INC.,

  
	
   

  	
   

  	
  a Montana corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Lee Danna

  
	
   

  	
   

  	
   

  	
  Lee Danna

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Its:

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
  6 A Liberty, Suite 200

  
	
   

  	
   

  	
   

  	
  Aliso Viejo, CA 92656

  
					



 


 


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