Document:

Exhibit 10.9

    
      
        

      

    

    Exhibit
      10.9

    

    EMPLOYMENT
      CONTRACT

    

    

    THIS
      AGREEMENT is made effective as of the 21st
      day of
      January, 2005

    

    BETWEEN: 

    

    Ralph
      Petruzzo,
      a person
      with an address at

    603
      Main
      Street

    Corinth,
      New York 12822

    

    (The
      “Employee”)

    

    

    OF
      THE
      FIRST PART

    

    

    
      	
              AND:

            	
              ORGANIC
                RECYCLING TECHNOLOGIES INC., a company incorporated pursuant to the
                laws
                of Nevada with an address at

            

    

    
      	 	
              Suite
                204 - 3970 East Hastings Street

            

    

    
      	 	
              Burnaby,
                BC V5C 6C1 

            

    

    

    (“The
      Company”)

    

    OF
      THE
      SECOND PART

    

    WHEREAS:

    

    
      	
              A.

            	
              The
                Company wishes to employ for the services of the Employee and to
                have the
                Employee agree to provide Employment services to any of the Company’s
                subsidiaries and affiliates, which require the Employee’s expertise and
                assistance during the term of this Agreement, as directed by the
                Company.

            

    

    

    
      	
              B.

            	
              The
                Employee has agreed to accept such contract for services upon the
                terms
                and conditions of this Agreement.

            

    

    

    NOW
      THEREFORE THIS AGREEMENT WITNESSETH THAT in consideration of the mutual
      covenants herein contained, the parties hereto agree as follows:

    

    
      	
              1.

            	
              ENGAGEMENT

            

    

    

    
      	
              1.1

            	
              Appointment
                -
                The Company hereby contracts for the services of the Employee and
                the
                Employee hereby agrees with the Company to perform services for the
                Company in accordance with the terms and conditions of this
                Agreement.

            

    

    

    
      	
              1.2

            	
              Scope
                of Duties -
                The Employee will provide the services (the
                “Employment Services”) as
                set forth in Schedule “A” to this
                Agreement.

            

    

    

    
      	
              1.3

            	
              The
                Employee will provide the services of
                Ralph Petruzzo,
                (the “Principle”) to provide the Employment services.
                

            

    

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    
      	
              1.4

            	
              Changes
                in scope of the Employment Services may only be made by mutual agreement
                of the parties.

            

    

    

    
      	
              1.5

            	
              Best
                Efforts
                -
                The Employee shall, at all times, provide and perform the Employment
                Services to the best of its abilities. In consideration for the Employment
                Fee as set forth in clause 3.1, Employee shall provide the Services
                on a
                priority basis to the Company and those subsidiaries and affiliates
                which
                enter into separate Employment contacts with the Employee, as directed
                by
                the Company.

            

    

    

    
      	
              1.6

            	
              Warranties
                and Responsibilities
                -
                The Employee warrants and represents to the Company as follows and
                acknowledges that the Company is relying upon these warranties and
                representations in entering into this
                Agreement:

            

    

    

    
      	 	
              (a)

            	
              The
                Employee has the necessary expertise in the Waste management and
                recycling
                industry and has worked in this industry for over 20 years to effectively
                provide the Employment
                Services;

            

    

    

    
      	 	
              (b)

            	
              The
                Employee brings with him all this expertise in the Waste management
                and
                Recycling Industry and this is his knowledge and expertise which
                the
                Company will utilize from the Employee during his term with the Company.
                The Employee maintains all the rights to his knowledge and expertise
                he
                acquired prior to joining the Company;

            

    

    

    
      	 	
              (c)

            	
              The
                Employee is not aware of any matter which would prevent the Employee
                from
                providing the Employee Services;

            

    

    

    
      	 	
              (d)

            	
              The
                Employee is not subject to any known review by any securities regulatory
                body that is currently in progress.

            

    

    

    
      	
              1.7

            	
              The
                Company shall supply onsite Employee personnel with suitable office
                space
                and office equipment including adequate communications equipment
                as may be
                necessary in connection with the Employee’s performance of the Employment
                Services. 

            

    

    

    
      	
              1.8

            	
              Work,
                research or development produced or created by the Employee during
                the
                term of this Agreement pertinent to the Company’s technical, scientific or
                business interests including processes, business plans, other material
                or
                information relating to the business, portions of computer software
                (in
                source and executable code) and related documentation in any media
                including all modifications, enhancements and versions thereof, unique
                software and hardware configurations, design concepts and all materials
                developed therefrom defined as Work
                Product.

            

    

    

    
      	
              1.9

            	
              Any
                Work Product created by Employee under this Agreement, either developed
                solely or jointly with any other party, is the sole and exclusive
                property
                of the Company. Company is the sole owner of all copyrights, patents
                and
                other intellectual property rights in the Work Product.
                

            

    

    

    
      	
              1.10

            	
              Employee
                assigns to the Company any rights Employee may have in the Work Product
                and waives all claims with respect to the Work Product including
                any moral
                rights in the Work Product or to its use including the right to restrain
                or claim damages for any distortion, mutilation or other modification
                of
                the Work Product and to restrain use or reproduction of the Work
                Product.

            

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    
      	
              1.11

            	
              Company
                acknowledges :

            

    

    

    
      	 	
              (A)

            	
              that
                Employee may use certain software libraries and development tools
                proprietary to Employee (“Employee Software”) to create the Work Product;
                and

            

    

    
      	 	
              (B)

            	
              Company
                does not obtain any proprietary or intellectual property rights in
                such
                Employee Software; and

            

    

    
      	 	
              (C)

            	
              Company’s
                use of Employee Software as embedded in the Work Product shall be
                governed
                by fully-paid, non-exclusive worldwide, runtime license to use such
                Employee Software.

            

    

     

    
      	
              1.12

            	
              The
                Company will assist the Employee and those of its subsidiaries and
                affiliates, which require the Employee’s expertise and assistance with the
                negotiation, and settlement of the terms of separate Employment
                contracts.

            

    

    

    
      	
              2.

            	
              TERM

            

    

    

    
      	
              2.1

            	
              Initial
                Term
                -
                The initial term of this Agreement shall be Five years commencing
                on the
                date first above written, subject to earlier termination as hereinafter
                provided.

            

    

    

    
      	
              2.2

            	
              Renewal
                -
                This Agreement shall be renewed for further terms of such duration
                and
                upon such terms and conditions as the Employee shall and the Company
                may
                mutually agree upon in writing.

            

    

    

    
      	
              3.

            	
              EMPLOYEE
                FEE

            

    

    

    
      	
              3.1

            	
              The
                Company shall pay to the Employee a monthly fee (the “Employment
                Fee”)
                in consideration of the Employment Services. The Employment Fee shall
                be
                US$120,000 per year, $5,000 per month paid with $5000 accrued.
                

            

    

    

    
      	
              3.2

            	
              The
                Employee shall be paid each month for Employment Services rendered
                during
                the month and the Company shall pay on or before the last day of
                the
                month. 

            

    

    

    
      	
              3.3

            	
              The
                Employee shall deliver to the Company a report detailing the activities
                and services provided to the Company for the time period as agreed
                with
                the board of Directors but not less than each
                week.

            

    

    

    
      	
              3.4

            	
              The
                Employee will provide, at the Company’s Written request, a copy of all
                Work Product including documents, designs, charts, and
                codes.

            

    

    

    
      	
              3.5

            	
              The
                Employee will ensure all Work Product will be backed-up and copied
                to
                safeguard against any loss or damage to the original Work
                Product.

            

    

    

    
      	
              3.6

            	
              The
                Employee will be issued 3,000,000 common shares of the Company for
                service
                and performance over two years:

            

    

    
      	 	
              (a)

            	
              1,000,000
                upon Board of Directors approval of performance to July 31,
                2005;

            

    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    

    
      	 	
              (b)

            	
              1,000,000
                upon Board of Directors approval of performance to January 31,
                2006;

            

    

    
      	 	
              (c)

            	
              1,000,000
                upon Board of Directors approval of performance to July 31,
                2006;

            

    

    
      	 	
              (i)

            	
              The
                3,000,000 Common Shares will be issued to Ralph Petruzzo but held
                by the
                Board of Directors of the Company in trust and voted by the Board
                of
                Directors majority until earned by Ralph
                Petruzzo.

            

    

    

    
      	
              3.7

            	
              The
                parties agree that the Employee Fee provided for in paragraph 3.1
                hereof
                is intended to include reimbursement for all other expenses incurred
                by
                the Employee, in connection with providing the Employment Services,
                except
                for the following expenses incurred by the Employee while providing
                the
                Employment Services:

            

    

    

    
      	 	
              (a)

            	
              Those
                expenses expressly stated to be reimbursed by the Company pursuant
                to this
                Agreement;

            

    

    

    
      	 	
              (b)

            	
              Reasonable
                travel expenses including transportation costs, meals, accommodation
                and
                related living out expenses;

            

    

    

    
      	 	
              (c)

            	
              Long
                distance telephone, facsimile, and video conferencing
                charges;

            

    

    

    
      	 	
              (d)

            	
              Cost
                of visas, airport fees, special taxes and other charges imposed by
                government for immigration related to travel on projects
                business;

            

    

    

    
      	 	
              (e)

            	
              Conference
                and related fees, purchase of technical books, journals and related
                information where authorized by the
                Company;

            

    

    

    
      	 	
              (f)

            	
              Other
                specific expenses incurred by the Employee with the prior written
                approval
                of the Company.

            

    

    

    The
      Employee with each invoice shall submit an account listing of reimbursable
      expenses incurred each month.

     

    
      	
              4.

            	
              OPTIONS

            

    

    

    
      	
              4.1

            	
              The
                Employee will also be entitled to receive in future years options
                to
                purchase additional shares of the Company as determined by the board
                of
                directors of the Company in its sole discretion with reference to
                options
                granted to officers and directors of the Company and the performance
                of
                the Employee.

            

    

     

    
      	
              5.

            	
              CONFIDENTIALITY

            

    

    

    
      	
              5.1

            	
              Confidential
                Information and Non-Disclosure
                -
                The Employee acknowledges and agrees that all information connected
                with
                the Company’s technology, including without limitation, all information,
                data, inventions, discoveries, improvements, modifications, developments,
                technically manuals or process-flow manuals, data, customer information
                and pricing information is confidential and the Employee covenants
                and
                agrees with the Company to use its best efforts to ensure that the
                such
                information does not become public knowledge and undertakes not to
                disclose such information or any part thereof to any other person
                except
                to its Employees and employees as may be necessary to carry out its
                rights
                and obligations under this
                Agreement.

            

    

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    

    
      	 	
              The
                Employee hereby further covenants and agrees with the Company that
                the
                Employee shall require each and every one of its employees or Employees
                who are provided with any information in respect of the Company’s
                technology or related knowledge to sign confidentiality agreements
                with
                the Employee in a form acceptable to the Company. All such information
                shall be returned to the Company upon termination of this
                Agreement.

            

    

    

    
      	
              5.2

            	
              Non-Competition
                -
                If the agreement is terminated the Employee agrees that during the
                following two year term, following termination the Employee will
                bring all
                opportunities, projects and deals either alone or in a partnership
                or
                jointly or in conjunction with any person or persons, including without
                limitation, any individual, firm, association, syndicate, company,
                corporation or other business enterprise, as principal, agent, shareholder
                or in any other manner whatsoever to the Company for review to accept
                or
                reject the opportunities, projects or deals on a right of first refusal
                basis for the Company to accept or reject the opportunities, projects
                or
                deals. This relates to opportunities, projects and deals in Canada
                the
                United States North America or in the world. The Employee acknowledges
                and
                agrees the geographical restrictions contained herein are reasonable
                in
                light of the nature of the Company'’ technology and business. The Employee
                further agrees, if the agreement is terminated, to
                not:

            

    

    

    
      	 	
              (a)

            	
              Carry
                on, be engaged in or concerned with or interested in any business,
                operation or undertaking which is in any way competitive with the
                business
                of the Company anywhere in Canada and in the United States where
                the
                business of the Company is carried on
                without first allowing the Company the right of first refusal on
                the
                opportunity;
                and

            

    

    

    
      	 	
              (b)

            	
              Attempt
                to solicit any suppliers, customers or employees of the business
                of the
                Company away from the Company.

            

    

     

    
      	
              6.

            	
              TERMINATION

            

    

    

    
      	
              6.1

            	
              Termination
                by the Company 

            

    

    

    
      	 	
              (a)

            	
              Material
                Breach by Employee
                -
                The Company may terminate this Agreement as a result of material
                breach of
                this Agreement by the Employee, provided that a reasonable written
                notice,
                of at least three (3) business days has been given by the Company,
                to the
                Employee and the Employee has been given an opportunity to cure the
                material breach. In the event of termination of this Agreement by
                the
                Company, as a result of a material breach of this Agreement by the
                Employee, all Options granted to the Employee will terminate and
                be of no
                force and effect and the Employee will not have any right to receive
                additional Options not granted as of the date of
                termination;

            

    

    

    
      	 	
              (b)

            	
              Without
                Material Breach by Employee
                -
                The Company acknowledges and confirms that the Employee will suffer
                damages for termination of this Agreement unless termination is due
                to a
                material breach by the Employee. Accordingly, the parties agree that
                a
                reasonable pre-estimate of damages payable by the Company to the
                Employee
                for termination of this Agreement by the Company is such circumstances
                will be as follows.

            

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    
      

      
        	 	
                (i)

              	
                During
                  this Agreement, damages equal to three months
                  fees;

              

      

       

    

    
      	 	
              which payment
                will be in full and final settlement of all claims, damages, and
                any other
                liabilities of the Company to the Employee pursuant to this Agreement
                to
                the date of such termination of the Employee’s services to the
                Company.

            

    

    

    
      	
              6.2

            	
              Termination
                by the Employee 

            

    

    

    
      	 	
              (a)

            	
              Material
                Breach by Company
                -
                The Employee may terminate this Agreement for material breach at
                any time
                provided that a reasonable written notice of at least three (3) business
                days has been given by the Employee to the Company and the Company
                has
                been given a reasonable opportunity to cure the material
                breach;

            

    

    

    
      	 	
              (b)

            	
              Without
                Material Breach by Company
                -
                The Employee may terminate this Agreement without there having been
                a
                material breach by the Company provided the Employee gives the Company
                at
                least three (3) months’ written
                notice.

            

    

     

    
      	
              6.3

            	
              Definition
                of Material Breach by Company-
                In this Agreement, the parties agree that a material breach of this
                Agreement by the Company includes:

            

    

    

    
      	 	
              (a)

            	
              The
                Company’s engagement in conduct which unreasonably jeopardizes the Company
                or the Employee and which the Company refuses to stop or rectify
                against
                the advice of the Employee given in
                writing;

            

    

    

    
      	 	
              (b)

            	
              The
                Company’s material default, misconduct, breach or non-observance of any
                material stipulation contained herein, after reasonable opportunity
                to
                cure such condition, if reasonable opportunity to remedy
                exists;

            

    

    

    
      	 	
              (c)

            	
              The
                dissolution, insolvency or bankruptcy of the
                Company.

            

    

    

    
      	
              6.4

            	
              Definition
                of Material Breach by Employee
                -
                In this Agreement, the parties agree that a material breach of this
                Agreement by the Employee includes:

            

    

    

    
      	 	
              (a)

            	
              The
                Employee’s material default, misconduct, breach or non-observance of any
                material stipulation contained herein after reasonable opportunity
                to cure
                such condition, if reasonable opportunity to remedy
                exists.

            

    

    

    
      	 	
              (b)

            	
              The
                failure of the Employee to provide
                Ralph Petruzzo to
                the Company acting reasonably, to provide the Employment
                Services;

            

    

    

    
      	 	
              (c)

            	
              The
                attempted assignment of this Agreement by the Employee, in breach
                of this
                Agreement or any change in control of the Employee or that the
                representation and warranty of the Employee in section 1.6(c) ceases
                to be
                correct;

            

    

    

    
      	 	
              (d)

            	
              The
                dissolution, insolvency or the bankruptcy of the
                Employee.

            

    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    

    
      	
              7.

            	
              OTHER
                PROVISIONS

            

    

    

    
      	
              7.1

            	
              Governing
                Law
                -
                This Agreement shall be governed by and construed in accordance with
                the
                laws of the Province of British
                Columbia.

            

    

    

    
      	
              7.2

            	
              Intellectual
                property Rights - Any intellectual property rights that the Employee
                creates during the performance of his services are the property of
                the
                Company. 

            

    

    

    
      	
              7.3

            	
              Notice
                -
                Any notice required, or permitted to be given under this Agreement
                shall
                be in writing and may be delivered personally or by telex or telecopier,
                or by prepaid registered post addressed to the parties at the
                above-mentioned addresses or at such other address of which notice
                may be
                given by either of such parties. Any notice shall be deemed to have
                been
                received if personally delivered or by telex or telecopier on the
                date of
                delivery and, if mailed as aforesaid, then on the seventh (7th)
                business day after and excluding the date of
                mailing.

            

    

    

    
      	
              7.4

            	
              Assignment
                -
                This Agreement may not be assigned by either party without the written
                consent of the other party.

            

    

    

    
      	
              7.5

            	
              Indemnity:

            

    

    

    
      	 	
              (a)

            	
              The
                Employee shall indemnify the Company and save it harmless from and
                against
                any and all claims, actions, damages, liabilities and expenses arising
                out
                of or in connection with a breach of any kind by the Employee of
                any
                provisions, covenants, conditions and warranties contained in this
                Agreement, or any other matter arising whatsoever out of this Agreement
                including the actions of other employees, agents or contractors of
                the
                Employee.

            

    

    

    
      	 	
              (b)

            	
              The
                Company shall indemnify the Employee and save it harmless from and
                against
                any and all claims, actions, damages, liabilities and expenses arising
                out
                of or in connection with a breach of any kind by the Company of any
                provisions, covenants, conditions and warranties contained in this
                Agreement, or any other matter arising whatsoever out of this Agreement
                including the actions of its employees, agents or contractors of
                the
                Company.

            

    

    

    
      	
              7.6

            	
              This
                Agreement supersedes any previous agreement, arrangement or understanding,
                whether written or oral between the parties
                hereto.

            

    

    

    
      	
              7.7

            	
              Severability
                -
                Any term or condition of this Agreement that is held to be unlawful
                or
                unenforceable is severable and the remaining terms and conditions
                of this
                Agreement remain in full force and
                effect.

            

    

    

    
      	
              7.8

            	
              Time
                is of the essence of this
                Agreement.

            

    

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    
      	
              7.9

            	
              This
                Agreement is subject to the applicable rules and regulations of whatever
                stock exchange(s) upon which the Shares of the Company may be traded
                from
                time to time, and the Company and the Employee undertake to exercise
                their
                best efforts to comply with such rules and regulations as they relate
                to
                this Agreement.

            

    

    

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

    

    
      	
              Ralph
                Petruzzo,  

            	
              Organic
                Recycling Technologies Inc., 

            
	
              By
                its Authorized signatory 

            	
              by
                its Authorized Signatory 

            
	 	 	 	 
	 	 	 	 
	
              /s/
                Ralph Petruzzo

            	 	
              /s/
                Chad Burback

            	 
	
              Signature

            	 	
              Signature

            	 
	 	 	 	 
	 	 	 	 
	
              July
                29, 2005

            	 	 	 
	
              Date

            	 	
              Chad
                Burback

            	 
	 	 	
              Print
                Name

            	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	
              Secretary

            	 
	 	 	
              Title

            	 
	 	 	 	 
	 	 	 	 
	 	 	
              July
                29, 2005

            	 
	 	 	
              Date

            	 

    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    Schedule
      A

     

    
      -
        Scope of Work

      

      
        	 	
                1)

              	
                Employed
                  as the President of Organic Recycling Technologies
                  Inc.;

              

      

      
        	 	
                2)

              	
                Reporting
                  to the Company’s board of
                  directors;

              

      

      
        	 	
                3)

              	
                Establishment
                  of a management executive committee that consults with the Company
                  and
                  works with the President to run the
                  Company;

              

      

      
        	 	
                4)

              	
                President
                  is the head of the Company’s management executive committee and reports to
                  the Company’s Board of Directors;

              

      

      
        	 	
                5)

              	
                President
                  to further the Company goals;

              

      

      
        	 	
                (i)

              	
                Obtaining
                  new deals for the Company using your skills, knowledge and
                  contacts;

              

      

      
        	 	
                (ii)

              	
                Working
                  with the management executive committee prepare and present all
                  new
                  opportunities to the Board of Directors for review and
                  approval;

              

      

      
        	 	
                (iii)

              	
                Working
                  with the management executive committee manage all new opportunities
                  by
                  ensuring quality managers and support is in place;
                  

              

      

      
        	 	
                6)

              	
                President
                  to work to finance the Company;

              

      

      
        	 	
                (i)

              	
                Working
                  with the management executive committee, ensure all new opportunities
                  are
                  supported by long term benefits to the Company and to assist the
                  management executive committee to provide analysis for the Board
                  of
                  Directors review and approval;

              

      

      
        	 	
                (ii)

              	
                Working
                  with the management executive committee, assist in the development
                  of
                  internal and external finance opportunities and strategies that
                  support
                  the Company goals and to assist the management executive committee
                  to
                  provide analysis for the Board of Directors review and
                  approval;

              

      

      
        	 	
                7)

              	
                Maintaining
                  Company operating procedures;

              

      

      
        	 	
                (i)

              	
                Work
                  with the management executive committee to maintain and regularly
                  update
                  the Company’s operating policies and procedures for review and approval
                  for the board of Directors of the
                  Company;

              

      

      
        	 	
                (ii)

              	
                Work
                  with the management executive committee to ensure all Company personnel
                  are knowledgeable and use the Company’s operating
                  procedures;

              

      

      
        	 	
                8)

              	
                Perform
                  such other duties and observe such instructions as may be reasonably
                  assigned from time to time by an immediate Supervisor, by or on
                  behalf of
                  the Company’s Board of Directors.

              

      

      
         

        9Exhibit 10.1

    
      
        

      

    

    SETTLEMENT
      AGREEMENT

    

    This
      Settlement Agreement (“Agreement”) is made as of the 19th day of August, 2005
      (hereinafter referred to as the “Effective Date”) by and between M-Wave, Inc.
      (“M-Wave”), Freeborn & Peters LLP (“F & P”), Joe Turek (“Turek”), Jim
      Mayer (“Jim Mayer”), Carl Klein (“Klein”), Jim Skelton (“Skelton”), Gary
      Castagna (“Castagna”), and Greg Meyer (“Greg Meyer”). M-Wave, F & P, Turek,
      Jim Mayer, Klein, Skelton, Castagna, and Greg Meyer are sometimes referred
      to
      hereinafter collectively as the “Parties.” Turek, Jim Mayer, Klein, Skelton,
      Castagna, and Greg Meyer are sometimes referred to hereinafter collectively
      as
      the “Individual Parties.” Turek and Jim Mayer are sometimes referred to
      hereinafter collectively as the “Executive Directors.” Klein, Skelton, Castagna
      and Greg Meyer are sometimes referred to hereinafter collectively as the
“Non-Executive Directors.”

    

    RECITALS

    

    A.             
      M-Wave
      is
      a Delaware corporation with headquarters in West Chicago, Illinois, whose common
      stock (the “Common Stock”) is traded on the Nasdaq SmallCap Market.

    

    B.             
      F
&
P
      is an Illinois limited liability partnership in the business of providing legal
      services and advice to its clients.

    

    C.             
      Turek
      is
      an individual, and is serving as M-Wave’s President and Chief Operating Officer
      and a member of M-Wave’s Board of Directors (hereinafter “the
      Board”).

    

    D.             
      Jim
      Mayer
      is an individual, and is serving as M-Wave’s Chief Executive Officer and a
      member of the Board.

    

    E.             
      Klein
      is
      an individual, and is serving as Chairman of the Board, and as Chairman of
      M-Wave’s Nominating and Corporate Governance Committee. Klein was employed by F
& P from May 2002 through July 1, 2005.

    

    F.             
      Skelton
      is an individual, and is serving as a member of the Board, as a member of
      M-Wave’s Compensation Committee and as a member of M-Wave’s Nominating and
      Corporate Governance Committee.

    

    G.             
      Castagna
      is an individual, and is serving as a member of the Board, as Chairman of
      M-Wave’s Audit Committee, as a member of M-Wave’s Compensation Committee, and as
      a member of M-Wave’s Nominating and Corporate Governance Committee.

    

    H.             
      Greg
      Meyer is an individual, and is serving as a member of the Board, as a member
      of
      M-Wave’s Audit Committee, and as Chairman of M-Wave’s Compensation
      Committee.

    

    I.             
      The
      Non-Executive Directors have asserted that Jim Mayer has not performed his
      duties as chief executive officer of M-Wave in a satisfactory manner and desire
      to reassign Jim Mayer as set forth herein. The Executive Directors deny such
      assertions.

    

    J.             
      The
      Executive Directors have threatened to sue the Non-Executive Directors and
      F
& P (and M-Wave as a nominal defendant), alleging, among other things,
      conflicts of interest and breaches of fiduciary duties. The Non-Executive
      Directors and F & P deny such allegations.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    K.             
      The
      Parties now desire to resolve the relationships among the parties prior to
      the
      Effective Date (the “Relationship”) and release each other from claims in the
      manner set forth in this Agreement.

    

    NOW
      THEREFORE, in consideration of the premises and mutual covenants and
      undertakings herein, the Parties agree as follows:

    

    
      	
              1.

            	
              No
                Litigation.

            

    

    

    The
      Executive Directors agree that they will not file a lawsuit against any of
      the
      other Parties (or any other potential defendant named in their threatened
      lawsuit) seeking a remedy for any allegations related to the Relationship,
      including but not limited to allegations of conflicts of interest and breaches
      of fiduciary duty, based on conduct or events predating the Effective Date.
      To
      the same effect neither shall F & P nor the Non-Executive Directors file a
      lawsuit seeking a remedy for any allegations related to the Relationship,
      including but not limited to allegations of misfeasance or nonfeasance by Jim
      Mayer or Turek based on conduct or events predating the Effective
      Date.

    

    
      	
              2.

            	
              M-Wave
                Corporate Restructuring.
                Effective upon the execution of this Agreement by all
                Parties:

            

    

    

    (a)             
      Jim
      Mayer
      hereby resigns his position as a member of the Board. Jim Mayer agrees to a
      reassignment from his current position as Chief Executive Officer to the
      position of Vice President and Chief Business Development Officer, with all
      terms and conditions of his Employment Agreement with M-Wave remaining in
      effect, except as otherwise provided in this Section 2(a). In an effort to
      help
      reduce M-Wave’s expenses, Jim Mayer has voluntarily agreed to reduce his annual
      salary to $203,150. In the position of Vice President and Chief Business
      Development Officer, Jim Mayer shall perform services consistent with his
      position as requested by the Board or by Turek as M-Wave CEO, but Jim Mayer
      will
      not involve himself in M-Wave’s financing activities (except as specifically
      contemplated by Section 3(c) below) or investor relations or securities law
      compliance matters, except to the extent specifically asked to do so by the
      Board. Jim Mayer has voluntarily agreed to return to M-Wave all of his 400,000
      options to purchase M-Wave common stock at $1.16 per share, and such options
      shall be canceled. M-Wave will issue to Jim Mayer options pursuant to the
      M-Wave, Inc. 2003 Stock Incentive Plan to purchase 150,000 shares of M-Wave
      common stock at the closing price on the Effective Date, which options shall
      be
      fully vested on the Effective Date and have a term of five years. The Board
      will
      take such action to amend or rescind previous actions as necessary to accomplish
      the terms of this Section 2(a).

    

    (b)             
      Skelton
      hereby resigns his position as a member of the Board.

    

    (c)             
      Turek
      agrees to a reassignment from his current position as President and Chief
      Operating Officer to the position of President and Chief Executive Officer,
      subject to review of his title by the Board on December 31, 2005, with any
      change in title to be effective January 1, 2006, with all terms and conditions
      of his Employment Agreement with M-Wave remaining in effect, except as otherwise
      provided in this Section 2(c). In an effort to help reduce M-Wave’s expenses,
      Turek has voluntarily agreed to reduce his annual salary to $182,750 and to
      return the proceeds of the bonus paid to Turek in June 2005. The Board will
      take
      such action to amend or rescind previous actions as necessary to accomplish
      the
      terms of this Section 2(c).

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    (d)             
      Upon
      Klein’s resignation from the Board as contemplated by Section 7(b) below, Turek
      shall be appointed as Chairman.

    

    
      	
              3.

            	
              M-Wave
                Corporate Procedure and Reporting.

            

    

    

    (a)             
      The
      reconstituted Board will convene at least once a month through year-end 2005.
      While reasonable attempts shall be made to meet in person, a conference call
      will be considered an acceptable alternative to an in-person meeting. At each
      monthly meeting, Turek, as CEO, will provide a summary report focusing on
      M-Wave’s business performance. This report shall inform the Board of issues
      relating to the performance of the business, including strategic initiatives
      and
      efforts for developing the business, as well as monthly financial results
      focusing on recurring items such as sales and gross margin, liquidity and cash
      availability, and a discussion of the actual results as compared to the
      plan.

    

    (b)             
      If
      Turek
      deems it appropriate based on business conditions, in his reasonable and sole
      discretion, Turek may, from time to time, elect to take a reduction in his
      pay,
      and Jim Mayer will accept a reduction in his pay proportionate to that elected
      by Turek. 

    

    (c)             
      Turek
      and
      Jim Mayer will use their best efforts to meet with Wells Fargo Business Credit
      and Mercator concurrently with the public disclosure of this Agreement pursuant
      to Section 5 of this Agreement.

    

    (d)             
      At
      any
      time that any remaining Executive Director or Non-Executive Director continues
      to be a director, that Party agrees that M-Wave will attempt to find and
      nominate individuals to fill the two vacated Board positions referred to in
      Section 2 promptly and such directors will follow their fiduciary duties to
      consider and vote on such nominations.

    

    
      	
              4.

            	
              M-Wave
                Common Stock.

            

    

    

    (a)             
      On
      June
      24, 2005, Jim Mayer was paid a discretionary bonus, subject to certain
      conditions (which have not as yet been satisfied) in the amount of $83,000
      (“the
      Bonus”). Jim Mayer agrees that on the Effective Date he will repay M-Wave the
      $3,000 excess amount received over the bonus actually authorized and he will
      also, within seven calendar days after the Effective Date, use all of the
      after-tax proceeds of the Bonus to exercise options for Common Stock that he
      currently holds, at an exercise price of $0.67 per share, in satisfaction of
      the
      original condition to the payment of the Bonus.

    

    
      	
              5.

            	
              Public
                Disclosure of This Agreement and Other Matters.

            

    

    

    (a)             
      Subject
      to Section 5(b) below, the Company will file, as promptly as practicable, a
      Current Report on Form 8-K with the U.S. Securities and Exchange Commission
      (“SEC”) relating to the matters contemplated by this Agreement and, as promptly
      as practicable, file a Form SB-2A covering the resale of certain shares of
      its
      common stock by MAG Capital and its related investment funds which are investors
      in M-Wave.

    

    (b)             
      The
      documents filed with the SEC pursuant to Section 5(a) shall be subject to the
      approval of the Board, whose approval shall not be unreasonably
      withheld.

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    
      
        	
                6.

              	
                M-Wave
                  Financial Advising.

              

      

    

    

    Promptly
      following the Effective Date, JAS Financial Services, LLC (“JASFSLLC”) will be
      retained as a financial advisor through December 31, 2005 (without any
      extensions, unless approved by a majority of the Board, which majority must
      include Turek) to the Board and the Company, on terms and conditions to be
      contained in a financial advisory agreement to be reviewed and negotiated with
      Skelton by counsel to M-Wave and subject to approval by the Board, but in any
      event on terms no worse to M-Wave than those terms and conditions circulated
      prior to the signing of this Agreement. If requested by the CEO or by the
      potential investor, JASFSLLC shall participate in the contact contemplated
      by
      Section 3 (c) above. Skelton is a principal of JASFSLLC.

    

    
      	
              7.

            	
              Retention
                of Legal Counsel.

            

    

    

    (a)             
      Subject
      to F & P’s continued agreement, which may be withdrawn at any time, F &
P will continue as counsel for M-Wave so long as either Greg Meyer or Castagna
      remain as members of the Board, unless the retention of additional counsel
      or
      replacement counsel is approved by a majority of the Board, which majority
      must
      include Turek.

    

    (b)             
      Klein
      shall resign from the Board promptly after the occurrence of both the Effective
      Date and the filing of all the documents contemplated by Section 5 above. At
      such time as Klein resigns from the Board, M-Wave will retain Klein as counsel
      to M-Wave’s independent directors in order to advise on Board matters, subject
      to Klein’s continued agreement, which may be withdrawn at any time. M-Wave shall
      continue to retain Klein to provide such legal services until the first to
      occur
      of: 1) the resignations of both Greg Meyer and Castagna from the Board; or
      2)
      December 31, 2005. During this period, Klein will be compensated at a rate
      of
      $10,000 per month for legal services rendered, plus reimbursement of reasonable,
      out-of-pocket expenses.

    

    (c)             
      Until
      Klein resigns from the Board, Turek will be permitted, at his own expense,
      to
      bring counsel of his own choosing (but only one such person at any meeting)
      to
      all meetings of the Board.

    

    
      	
              8.

            	
              Legal
                Costs and Insurance.

            

    

    

    (a)             
      M-Wave
      will promptly pay all remaining reasonable legal fees of the Parties incurred
      as
      a direct result of the dispute that arose with respect to the Relationship,
      subject to cash availability; provided, however, that in no event will M-Wave
      make, after the Effective Date, (i) any reimbursement of such legal fees
      incurred by the Executive Directors that are in excess of $75,000, or (ii)
      any
      reimbursement of such legal fees incurred by the Non-Executive Directors that
      are in excess of $35,000.

    

    (b)             
      Subject
      to cash availability, M-Wave will obtain a 2-year “tail” on its Directors’ and
      Officers’ liability insurance policy for the purpose of providing insurance
      coverage to any of the Parties that leaves the Board pursuant to the terms
      of
      this Agreement.

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    
      	
              9.

            	
              Mutual
                Releases.

            

    

    

    (a)             
      For
      and
      in consideration of the execution, delivery and performance of this Agreement,
      the Executive Directors and M-Wave hereby release and discharge all other
      Parties to this Agreement and all other potential defendants named in their
      threatened lawsuit from all claims, demands, causes of action, lawsuits, duties,
      obligations, actions, judgments and liens in law or equity or both law and
      equity which they ever had, now have or hereafter can, shall or may have against
      any such other Party arising out of or in any way related to the Relationship.
      Also for and in consideration of the execution, delivery and performance of
      this
      Agreement, the Non-Executive Directors and M-Wave hereby release and discharge
      all other Parties to this Agreement (except that Klein does not release or
      discharge F & P) from all claims, demands, causes of action,
      lawsuits, duties, obligations, actions, judgments and liens in law or equity
      or
      both law and equity which they ever had, now have or hereafter can, shall or
      may
      have against any such other Party arising out of or in any way related to the
      Relationship. Also for and in consideration of the execution, delivery and
      performance of this Agreement, F & P hereby releases and discharges all
      other Parties to this Agreement (other than Klein, who F & P does not
      release or discharge) from all claims, demands, causes of action, lawsuits,
      duties, obligations, actions, judgments and liens in law or equity or both
      law
      and equity which it ever had, now has or hereafter can, shall or may have
      against any such other Party (other than Klein) arising out of or in any way
      related to the Relationship. 

    

    (b)             
      For
      and
      in consideration of the execution, delivery and performance of this Agreement,
      M-Wave hereby releases and discharges F & P and its current and former
      partners, agents and employees from all claims, demands, causes of action,
      lawsuits, duties, obligations, actions, judgments and liens in law or equity
      or
      both law and equity which it ever had, now has or hereafter can, shall or may
      have against F & P arising out of or in any way related to the
      Relationship.

    

    (c)             
      The
      foregoing notwithstanding, these mutual releases shall not apply to claims
      arising out of future events. They also shall not apply to claims of
      compensation for services provided, nor shall this Section 9 affect or release
      any Party under the employment agreement between Jim Mayer and M-Wave, the
      employment agreement between Turek and M-Wave, provisions for compensation
      to
      Directors for service as such, as reflected in Board minutes or past practices,
      and the option agreements issued by M-Wave to each of the Individual Parties;
      provided that such employment agreements shall each be amended as needed to
      incorporate the change of titles and responsibilities (and, if elected by Turek,
      the reductions in pay provided above) as provided in this Agreement, the option
      agreement for Jim Mayer’s 400,000 shares of M-Wave common stock shall be
      canceled, and the option agreements of Klein and Skelton shall be amended to
      comply with prior Board action so that they do not expire or otherwise terminate
      as a result of their resignations in accordance with this Agreement. They also
      shall not apply to M-Wave’s right to object to F & P’s bills for periods
      ending on or prior to June 30, 2005.

    

    (d)             
      Notwithstanding
      the provisions of Section 9(a) and 9(b) of this Agreement, nothing therein
      shall
      be construed to release or discharge any Party from the performance of such
      Party’s duties and obligations under this Agreement.

    

    (e)             
      F
&
P
      and Klein acknowledge that they do not have a dispute with each other relating
      to the matters contemplated by this Agreement. The release of F & P by
      Klein, and the release of Klein by F & P, will be handled as part of a
      separate agreement between F & P and Klein.

    

    
      	
              10.

            	
              Representations
                and Warranties.

            

    

    

    (a)             
      M-Wave
      represents and warrants to the other Parties the following: (a) M-Wave is duly
      incorporated, validly existing and in good standing under the laws of its state
      of incorporation or organization, has the power to execute, deliver and fully
      perform this Agreement and has taken all necessary actions to do so; (b) it
      has
      not taken any actions (including without limitation the assignment of any right
      or remedy) or failed to take any action(s) that would preclude or adversely
      affect the full performance of this Agreement by it; and (c) it has the capacity
      and the authority to enter into this Agreement and agrees to be responsible
      for
      its performance hereunder.

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    (b)             
      F
&
P
      represents and warrants to the other Parties the following: (a) F & P is a
      validly existing Illinois limited liability partnership; (b) it has not taken
      any actions (including without limitation the assignment of any right or remedy)
      or failed to take any action(s) that would preclude or adversely affect the
      full
      performance of this Agreement by it; and (c) it has the capacity and the
      authority to enter into this Agreement and agrees to be responsible for its
      performance hereunder.

    

    (c)             
      Each
      of
      the Individual Parties represents and warrants to the other Parties the
      following: (a) he has not taken any actions (including without limitation the
      assignment of any right(s), remedy or remedies) or failed to take any action(s)
      that would preclude or adversely affect the full performance of this Agreement
      by him; and (b) he has the capacity and the authority to enter into this
      Agreement and agrees to be responsible for the performance
      hereunder.

    

    
      	
              11.

            	
              Governing
                Law; Jurisdiction.

            

    

    

    (a)             
      This
      Agreement shall be governed by and interpreted under the laws of the State
      of
      Illinois.

    

    (b)             
      The
      Parties agree that any and all disputes arising out of or relating in any way
      to
      this Agreement shall be litigated only in state court or federal court situated
      in Chicago, Illinois, and waive all objections based on personal jurisdiction
      or
forum
      non-conveniens.

    

    
      	
              12.

            	
              Construction.

            

    

    

    (a)             
      The
      headings appearing in this Agreement are for convenience only and shall not
      be
      deemed to define, limit or construe the contents hereof. The Recitals shall
      be
      deemed to be part of this Agreement. This Agreement shall be deemed to be the
      agreement of each Party, and no rule of construction shall be applied against
      either Party. 

    

    (b)             
      This
      Agreement: (i) constitutes the entire understanding of the Parties with respect
      to the subject matter hereof and each Party agrees that no promise, inducement
      or agreement not herein expressed has been made to it; (ii) supersedes all
      agreements, representations or statements, either oral or written, regarding
      the
      subject matter hereof; and (iii) except as otherwise provided herein, may be
      amended or modified only by a written supplement, duly executed by each of
      the
      Parties.

    

    
      	
              13.

            	
              No
                Admission of Liability.

            

    

    

    Nothing
      contained in the Agreement shall be construed as an admission by either party
      of
      any wrongdoing or liability of any kind.

    

    
      	
              14.

            	
              Validity
                and Severability.

            

    

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    The
      Parties acknowledge that they are entering into this Agreement
      voluntarily and with the advice of counsel, and they waive all rights to
      challenge the validity
      or enforceability of this Agreement. All Parties have consulted with, or have
      been advised to and afforded the opportunity to consult with counsel of their
      own choosing (which, in the case of the Individual Parties, has not been F
&
P), and the Individual Parties have not relied on the advice of F & P
      regarding this Agreement. If any part, term or provision of this Agreement
      is
      hereafter declared invalid, void or unenforceable,
      then all remaining parts, terms, and provisions shall remain in full force
      and
      effect and shall not be invalidated, impaired or affected thereby.

    

    
      	
              15.

            	
              Counterparts.

            

    

    

    This
      Agreement may be executed in multiple counterparts, each of which shall be
      deemed an original for all purposes. 

    

    
      	
              16.

            	
              Enforcement.

            

    

    

    (a)             
      The
      respective rights and remedies of each Party are cumulative, and no exercise
      or
      enforcement by any Party of any right or remedy hereunder shall preclude the
      exercise or enforcement by such Party of any other right or remedy hereunder
      or
      which such Party is otherwise entitled by law to enforce. 

    

    (b)             
      Each
      Party may waive any obligation of or restriction upon any other Party under
      this
      Agreement; provided that any such waiver may only be made in writing signed
      by
      the Party making the waiver. No failure, refusal, neglect, delay, waiver,
      forbearance or omission of any Party to exercise any right under this Agreement
      or to insist upon full compliance by any other Party with its obligations
      hereunder, shall constitute a waiver of any provision(s) of this
      Agreement.

    

    
      	
              17.

            	
              Specific
                Performance.

            

    

    

    The
      parties hereto acknowledge that irreparable damage would result if this
      Agreement were not specifically enforced, and they therefore consent that the
      rights and obligations of the parties hereto under this Agreement may be
      enforced by a decree of specific performance issued by a court of competent
      jurisdiction. Such remedy shall, however, not be exclusive and shall be in
      addition to any other remedies which any party hereto may have under this
      Agreement or otherwise.

    

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

     

    IN
      WITNESS WHEREOF, each Party, intending this Agreement to be effective as of
      the
      Effective Date, has executed this Agreement on his own behalf or has caused
      this
      Agreement to be executed by its duly authorized representative.

     

    
      	
              M-Wave,
                Inc.

            	
              Freeborn
                & Peters LLP

            
	 	 
	
              By:
                /s/
                Joseph A. Turek

            	
              By:
                /s/
                Michael J. Kelly

            
	 	 
	
              Date:
                August 19, 2005

            	
              Date:
                August 19, 2005

            
	 	 
	 	 
	
              /s/
                Joseph A. Turek

            	
              /s/
                Carl R. Klein

            
	
              Joe
                Turek

            	
              Carl
                Klein

            
	 	 
	
              Date:
                August 19, 2005

            	
              Date:
                August 19, 2005

            
	 	 
	 	 
	
              /s/
                Jim Mayer

            	
              /s/
                Gregory E. Meyer

            
	
              Jim
                Mayer

            	
              Greg
                Meyer

            
	 	 
	
              Date:
                August 19, 2005

            	
              Date:
                August 19, 2005

            
	 	 
	 	 
	
              /s/
                Gary L. Castagna

            	
              James
                A. Skelton

            
	
              Gary
                Castagna

            	
              Jim
                Skelton

            
	 	 
	
              Date:
                August 19, 2005

            	
              Date:
                August 19, 2005

            

    

     

    8

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