8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported):   April 12, 2005

THE NEPTUNE SOCIETY, INC.

(Exact name of registrant as specified in its charter)

Florida

(State or Other Jurisdiction of Incorporation)

000-31182	59-2492929
(Commission file number)	(I.R.S. Employer Identification No.)

4312 Woodman Avenue, Third Floor
Sherman Oaks, California 91423

(Address of Principal Executive Offices and Zip Code)

Telephone (818) 953-9995

(Registrant's telephone number, including area code)

Not Applicable

(Former name or address, if changed since last report)

Item 1.01   Entry into a Material Definitive Agreement

Employment Agreements

In keeping with the departure of Neptune’s Chairman and Chief Executive Officer (as previously announced on February 8, 2005) and the promotion of Jerry Norman as Chief Executive Officer (also announced on February 8, 2005), the Board of Directors of the Company has focused efforts on securing long term employment agreements with its key officers to assure continuity and enable the Company to execute its business plan.

Accordingly, on April 12, 2005, The Neptune Society, Inc., a Florida corporation (“Neptune Society” or the “Company”), entered into employment agreements with the following executive officers: Jerry Norman, President and Chief Executive Officer; Daniel Solberg, Chief Financial Officer, Secretary and Treasurer; James Ford, Chief Operating Officer; and Gary Harris, the National Sales Manager of the Company.

The terms of the Employment Agreements are summarized as follows:

Jerry Norman Employment Agreement

Neptune Society entered into an employment agreement, effective as of February 8, 2005, with Jerry Norman to serve as President and Chief Executive Officer of the Neptune Society. The employment agreement supersedes the employment agreement between Neptune Society and Mr. Norman dated February 1, 2004, as amended February 7, 2005.

Term: The Agreement shall become effective on February 8, 2005, and shall continue until February 7, 2008 unless terminated upon mutual consent of Mr. Norman and the Company, or until termination by Mr. Norman or the Company in accordance with the agreement.

Compensation: Mr. Norman is to perform all duties incident to his position and other duties as may reasonably be required from time to time by the Board of Directors for an annual salary of $222,000 and executive benefits including health insurance benefits and a monthly housing allowance of $4,000.

Annual Bonus: Mr. Norman is also eligible to receive, conditioned on the Employee being employed by the Company on December 31^st of the applicable year, an annual bonus of up to a maximum of 100% of the Employee’s annual compensation. The Annual Bonus shall be calculated based on achievement of yearly goals to be set by the Board of Directors on or before December 31^st of each year. The Annual Bonus, if any, shall be paid to the Employee on or before March 31^stof the calendar year following the year in which the goals are achieved even if the Employee is no longer employed by the Company on March 31^st.

Stock Options: Mr. Norman shall retain the 150,000 stock options granted pursuant to the employment agreement dated February 1, 2004. The attached contract also addresses vesting schedules and the potential relinquishment of shares in the event the Company does not go private.

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Long Term Incentive: Neptune Society and Mr. Norman agree that Neptune Society would grant to Mr. Norman a Long Term Incentive, in part, as replacement consideration for Mr. Norman’s agreement to relinquish 50,000 of the 150,000 options in the event that the Company does not become privately owned by December 31, 2005. In addition to the annual compensation, Mr. Norman shall earn a one-time bonus equal to 1.5% of the Increased Value (the “Bonus Amount”). The Bonus Amount shall be paid in full within ninety (90) days of the Termination Date.

No Bonus Amount shall be earned by Mr. Norman or be payable hereunder in the event that:

(a) Mr. Norman is terminated for cause; or

(b) During the Employment Period, the Value of the Company has not increased by a minimum of 15% per year (as averaged over the Employment Period).

Termination: The employee shall be entitled to terminate the agreement, at any time by giving 4 weeks’ written notice. The Company shall be entitled to terminate the agreement at any time without cause by giving the employee four (4) weeks’ notice in writing of the termination. In the event that employee’s employment is terminated without cause, the Company shall pay to employee (i) any salary and accrued vacation pay earned but unpaid as of the date of termination; (ii) a severance payment in an amount equal to seven months of the annual salary if during the first year of this Agreement or eight months of the annual salary if during the second or third year of this Agreement; (iii) the Bonus Amount; and (iv) any Annual Bonus earned by the Employee but unpaid on the date of termination.

Daniel Solberg Employment Agreement

Neptune Society entered into an employment agreement, effective as of March 1, 2005, with Daniel Solberg to serve as Chief Financial Officer, Secretary and Treasurer of the Neptune Society. The employment agreement supersedes the employment agreement between Neptune Society and Mr. Solberg dated June 1, 2004.

Term: The agreement shall become effective on the 1st day of March 2005, and shall continue until February 28, 2008 unless terminated upon mutual consent of Mr. Solberg and the Company, or until termination by Mr. Solberg or the Company in accordance with the agreement. The agreement may be renewed for one additional 12 month term by the Company commencing March 1, 2008, upon 90 days notice prior to the end of the term.

Compensation: Mr. Solberg is to perform all duties incident to his position and other duties as may reasonably be required from time to time by the CEO and Board of Directors for an annual salary of $200,000 and executive benefits including health insurance benefits and a monthly housing allowance of $1,000.

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Annual Bonus: Mr. Solberg is also eligible to receive, conditioned on the Employee being employed by the Company on December 31^st of the applicable year, an annual bonus of up to a maximum of 100% of the Employee’s annual compensation. The Annual Bonus shall be calculated based on achievement of yearly goals to be set by the Board of Directors on or before December 31^st of each year. The Annual Bonus, if any, shall be paid to the Employee on or before March 31^st of the calendar year following the year in which the goals are achieved even if the Employee is no longer employed by the Company on March 31^st.

Stock Options: Mr. Solberg shall retain the stock options granted under the Employment Agreement between the Company and the Employee dated June 1, 2004; however, the period of time that Employee shall be entitled to exercise those options shall be extended through and including May 31, 2008.

Long Term Incentive: Mr. Solberg shall be entitled to earn a Long Term Incentive equal to 1.5% of the Increased Value (the “Bonus Amount”). The Bonus Amount shall be paid in full within ninety (90) days of the Termination Date.

No Bonus Amount shall be earned by Mr. Solberg or be payable hereunder in the event that:

(a) Mr. Solberg is terminated for cause; or

(b) During the Employment Period, the Value of the Company has not increased by a minimum of 15% per year (as averaged over the Employment Period).

Termination: The employee shall be entitled to terminate the agreement, at any time by giving 4 weeks’ written notice. The Company shall be entitled to terminate the agreement at any time without cause by giving employee four (4) weeks’ notice in writing of the termination. In the event that employee’s employment is terminated without cause, the Company shall pay to employee (i) any salary and accrued vacation pay earned but unpaid as of the date of termination; (ii) a severance payment in an amount equal to six months of the annual salary; (iii) the Bonus Amount; and (iv) any Annual Bonus earned by the Employee but unpaid on the date of termination.

James Ford Employment Agreement

Neptune Society entered into an employment agreement, effective as of March 1, 2005, with James Ford to serve as Chief Operating Officer of the Neptune Society. The employment agreement supersedes the employment agreement between Neptune Society and Mr. Ford dated September 1, 2004, as amended on February 7, 2005.

Term: The agreement shall become effective on March 1, 2005, and shall continue until February 28, 2008 unless terminated upon mutual consent of Mr. Ford and the Company, or until termination by Mr. Ford or the Company in accordance with the agreement.

Compensation: Mr. Ford is to perform all duties incident to his position and other duties as may reasonably be required from time to time by the C.E.O., C.F.O. or President for an annual salary of $170,000 during the first year of this agreement, $176,800 during the second year of this agreement, and $183,872 during the third year of this agreement.

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Annual Bonus: Mr. Ford is also eligible to receive, conditioned on the Employee being employed by the Company on December 31^st of the applicable year, an annual bonus of up to a maximum of 60% of the Employee’s annual compensation. The Annual Bonus shall be calculated based on achievement of yearly goals to be set by the Board of Directors on or before December 31^st of each year. The Annual Bonus, if any, shall be paid to the Employee on or before March 31^st of the calendar year following the year in which the goals are achieved even if the Employee is no longer employed by the Company on March 31^st.

Long Term Incentive: Mr. Ford shall be entitled to earn a Long Term Incentive equal to 0.75% of the Increased Value (the “Bonus Amount”). The Bonus Amount shall be paid in full within ninety (90) days of the Termination Date.

No Bonus Amount shall be earned by Mr. Ford or be payable hereunder in the event that:

(a) Mr. Ford is terminated for cause; or

(b) During the Employment Period, the Value of the Company has not increased by a minimum of 15% per year (as averaged over the Employment Period).

Termination: The employee shall be entitled to terminate the agreement, at any time by giving 4 weeks’ written notice. The Company shall be entitled to terminate the agreement at any time without cause by giving employee four (4) weeks’ notice in writing of the termination. In the event that employee’s employment is terminated without cause, the Company shall pay to employee (i) any salary and accrued vacation pay earned but unpaid as of the date of termination; (ii) a severance payment in an amount equal to six months of the annual salary; (iii) the Bonus Amount; and (iv) any Annual Bonus earned by the Employee but unpaid on the date of termination.

Gary Harris Employment Agreement

Neptune Society entered into an employment agreement, effective as of March 1, 2005, with Gary Harris to serve as the National Sales Manager of the Neptune Society. The employment agreement supersedes the employment agreement between Neptune Society and Mr. Harris dated February 1, 2004.

Term: The agreement shall become effective on March 1, 2005, and shall continue until February 28, 2008 unless terminated upon mutual consent of Mr. Harris and the Company, or until termination by Mr. Harris or the Company in accordance with the agreement.

Compensation: Mr. Harris is to perform all duties incident to his position and other duties as may reasonably be required from time to time by the C.E.O., C.O.O. or President for an annual salary of US $75,000 and an override of $10 on each Pre-Need Contract sold. During the term of this Agreement, Mr. Harris will be provided with a vehicle which is paid for and insured by the Company, at a lease rate capped at $1,000 per month.

Annual Bonus: Mr. Harris is also eligible to receive, conditioned on the employee being employed by the Company on December 31^st of the applicable year, an annual bonus of up to a maximum of 10% of the Employee’s annual

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compensation. The Annual Bonus shall be calculated based on achievement of yearly goals to be set by the Board of Directors on or before December 31^st of each year. The Annual Bonus, if any, shall be paid to the Employee on or before March 31^st of the calendar year following the year in which the goals are achieved even if the Employee is no longer employed by the Company on March 31^st.

Stock Options: Mr. Harris shall retain the stock options granted under the Employment Agreement between the Company and the Employee dated June 1, 2004; however, the time period that Employee shall be entitled to exercise those options shall be extended through and including May 31, 2008.

Long Term Incentive: Mr. Harris shall be entitled to earn a Long Term Incentive equal to 0.75% of the Increased Value (the “Bonus Amount”). The Bonus Amount shall be paid in full within ninety (90) days of the Termination Date.

No Bonus Amount shall be earned by Mr. Harris or be payable hereunder in the event that:

(a) Mr. Harris is terminated for cause; or

(b) During the Employment Period, the Value of the Company has not increased by a minimum of 15% per year (as averaged over the Employment Period).

Termination: The employee shall be entitled to terminate the agreement, at any time by giving 4 weeks’ written notice. The Company shall be entitled to terminate the agreement at any time without cause by giving employee four (4) weeks’ notice in writing of the termination. In the event that employee’s employment is terminated without cause, the Company shall pay to employee (i) any salary and accrued vacation pay earned but unpaid as of the date of termination; (ii) a severance payment in an amount equal to six months of the salary; (iii) the Bonus Amount; and (iv) any Annual Bonus earned by the Employee but unpaid on the date of termination.

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Item 1.02  Termination of a Material Definitive Agreement

On April 12, 2005, Neptune Society terminated existing employment agreements and entered into new employment agreements with the following executive officers: Jerry Norman, President and Chief Executive Officer; Daniel Solberg, Chief Financial Officer, Secretary and Treasurer; James Ford, Chief Operating Officer; and Gary Harris, the National Sales Manager of the Company.

Item 9.01  Financial Statements and Exhibits

Exhibits

Number Description

10.1 Employment Agreement between Neptune Society and Jerry Norman, President and Chief Executive Officer

10.2 Employment Agreement between Neptune Society and Daniel Solberg, Chief Financial Officer, Secretary and Treasurer

10.3 Employment Agreement between Neptune Society and James Ford, Chief Operating Officer

10.4 Employment Agreement between Neptune Society and Gary Harris, the National Sales Manager of the Company

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	THE NEPTUNE SOCIETY, INC.
Date:  April 18, 2005
	/s/ Dan Solberg
	Name:  Dan Solberg Title:    Chief Financial Officer

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EX-10.1

EXHIBIT 10.1

EMPLOYMENT AGREEMENT

        THIS AGREEMENT is effective February 8, 2005 and replaces the Employment Agreement entered into on February 1, 2004 as amended on February 7, 2005.

BETWEEN:

THE NEPTUNE SOCIETY, INC. a Florida corporation having its offices at 4312 Woodman Avenue, Third Floor, Sherman Oaks, CA 91423;

(the “Company”)

AND:

Jerry Norman, an individual having his residence at 1661 204^th Ave, NE, Sammamish, WA 98074.

(the “Employee”)

        WHEREAS, the Company wishes to obtain the services of the Employee, and the Employee is willing to provide his service to the Company upon the terms and conditions set forth in this Agreement.

        NOW THEREFORE, in consideration of the premises and mutual covenants and agreements herein set forth, the parties hereto mutually covenant and agree as follows:

CONTRACT FOR SERVICES

1.     The Company hereby engages the Employee to act as the President and Chief Executive Officer. The Employee shall perform all duties incident to such position of Chief Executive Officer and other duties as may reasonably be required from time to time by the Board of Directors.

2.     The Employee shall provide the services at the time and in the manner set forth herein. The Employee shall perform his duties out of the Sherman Oaks, California or Florida office of the Company, but the Company may, at its discretion, direct that the duties be provided on occasion in other locations. The Employee shall perform his duties as long as a suitable work permit is in effect from the appropriate governing authorities.

VACATION

3.     Under this Agreement, the Employee is entitled to four weeks vacation per year.

FEES AND EXPENSES

4.1     In consideration of the Employee providing his services as President and Chief Executive Officer, the Company shall pay to the Employee, $222,000 annually.

The Company shall provide directly to the Employee, at no cost, vehicle parking at the office site. Medical or health insurance benefits for the Employee and Spouse shall be paid by the Company. The Employee will be directly responsible for all necessary travel, auto, and any other expenses incurred by the Employee in connection with the provision of the services hereunder, however, expenses incurred in performance of the work will be reimbursed by The Company per company policy. Expenses required to be paid by the Company for specifically required Company work, the Employee shall furnish statements and receipts as a requirement for reimbursement.

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(a)      Housing allowance. In addition, the Company shall provide the Employee with a monthly housing allowance of $4,000. This amount is in addition to the annual fees stated above. This will be payable on the 15th of each month.

4.2     Annual Bonus. In addition to the annual compensation set forth in paragraph 4.1 and conditioned on the Employee being employed by the Company on December 31^st of the applicable year, the Employee shall be eligible to earn an annual bonus of up to a maximum of 100% of the Employee’s annual compensation (the “Annual Bonus”). The Annual Bonus shall be calculated based on achievement of yearly goals to be set by the Board of Directors on or before December 31^st of each year. The Annual Bonus, if any, shall be paid to the Employee on or before March ^31st of the calendar year following the year in which the goals are achieved even if the Employee is no longer employed by the Company on March 31^st. For the calendar year 2005, the goals set by the Board of Directors and the manner of calculating the Annual Bonus are attached hereto as Appendix A

4.3     Stock Options. Employee shall retain the 150,000 stock options granted pursuant to paragraph 4.3 of the employment agreement dated February 1, 2004 with the same exercise price of $0.70 US per share, subject to the following:

(a)      100,000 of the options, to the extent not already vested, shall vest and become immediately exercisable as of the Effective Date of this Agreement;

(b)      In the event that, on or before December 31, 2005, the Company becomes a privately-owned company and is no longer publicly-traded, all of the remaining stock options, to the extent not already vested and exercisable, shall immediately vest and become immediately exercisable by Employee;

(c)      In the event that, on December 31, 2005, (i) Employee is still employed by the Company and (ii) the Company is still a publicly-traded company, 50,000 of the 150,000 options shall be deemed to have not vested and shall be immediately relinquished by Employee. For the avoidance of doubt, the parties have agreed that the Long Term Incentive provided in paragraph 4.4 hereof is being granted to Employee, in part, as replacement consideration for Employee’s agreement to relinquish 50,000 of the 150,000 options in the event that the Company does not become privately owned by December 31, 2005.

For the avoidance of doubt, this paragraph, and not paragraph 4.3 of the employment agreement dated February 1, 2004, shall govern the stock options granted to the employee.

4.4     Long Term Incentive.

(1)      For purposes of this paragraph, the capitalized terms shall have the meanings set forth below:

(a)      “EBITDA” means Earnings Before Interest, Taxes, Depreciation and Amortization, calculated in accordance with U.S. Generally Accepted Accounting Principles. However, extraordinary or non-recurring expenses such as costs associated with the opening of a new office shall not be included in the EBITDA for purposes of this paragraph.

(b)      “Termination Date” means the date on which Employee’s employment terminates or the date on which this Agreement expires.

(c)      “Employment Period” means the period of time between the Effective Date of this Agreement and the Termination Date.

(d)      “Value” means EBITDA for the fiscal year ended immediately prior to the Termination Date, multiplied by 8.

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(e)      “Base Value” means EBITDA for the year ended December 31, 2004, multiplied by 8. For purposes of this Agreement, EBITDA for the year ended December 31, 2004 is deemed to be $3,125,000, and Base Value is deemed to be $25,000,000.

(f)      “Increased Value” means the positive difference between Value and Base Value.

(2)      In addition to the annual compensation set forth in paragraph 4.1, Employee shall earn a one-time bonus equal to 1.5% of the Increased Value (the “Bonus Amount”). The Bonus Amount shall be paid in full within ninety (90) days of the Termination Date. For purposes of example only, in the event the Termination Date is February 7, 2008, and EBITDA for the fiscal year ended immediately prior to February 7, 2008 is $6,000,000, Employee’s bonus shall be equal to $345,000, i.e., [($48,000,000-$25,000,000) x 1.5% = $23,000,000 x 1.5% = $345,000]

(3)      No Bonus Amount shall be earned by Employee or be payable hereunder in the event that:

(a)     Employee is terminated for cause; or

(b)      During the Employment Period, the Value of the Company has not increased by a minimum of 15% per year (as averaged over the Employment Period).

CONFIDENTIAL INFORMATION

5.     The Employee shall well and faithfully provide the service to the Company, and use his best efforts to promote the interest thereof and shall not disclose (either during the term of this Agreement or at any time thereafter) the private affairs of the Company or any non-public trade secret of the Company, to any persons other than the Management of the Company, or as required in the normal course of business and shall not use (either during the continuance of this Agreement or at any time thereafter) for his own purposes, or for any purposes other than those of the Company, any information he may acquire with respect to the Company’s affairs. The Employee further agrees to execute such further and other agreements concerning the secrecy of the affairs of the Company or of any companies with which the Company is affiliated or associated, as the Management of the Company shall reasonably request. Furthermore, without restricting the generality of the foregoing, the Employee shall not either during the term of this Agreement or any time thereafter, directly or indirectly divulge to any person, firm or corporation:

(a)      any non-public intellectual property, proprietary information, know-how, trade secrets, processes, product specifications, new product information or methods of doing business acquired in the course of providing the services hereunder;

(b)      any non-public information with respect of Company personnel or organization, or any of the financial affairs or business plans of the Company; or

(c)      any non-public information in respect of Company pricing policies, sales statistics, sales and marketing plans and strategies, profits, costs, or sourcing of clients.

TERM OF AGREEMENT

6.     This Agreement shall become effective on February 8, 2005, and shall continue until February 7, 2008 unless terminated upon mutual consent of the Employee and the Company, or until termination by the Employee or the Company in accordance with Sections 7 or 8, whichever is earlier.

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BREACH OF AGREEMENT

7.     Without prejudice to any remedy the Company may have against the Employee for any breach or non-performance of this Agreement, the Company may terminate this Agreement, subject to Section 11, for breach by the Employee at any time effective immediately and without notice and without any payment for any compensation either by way of anticipated earnings or damage of any kind to him whatsoever, save and except in respect of fees payable to the date of such termination. For the purposes of this paragraph, any one of the following events shall constitute breach of this Agreement sufficient for termination, provided however, that the following events shall not constitute the only reasons for termination:

(a)      being guilty of any dishonesty or gross neglect in the provision of the services hereunder; or

(b)      being convicted of any criminal offense, other than an offense which in the reasonable opinion of the Company does not affect his position as a representative of the Company; or

(c)      becoming bankrupt or making any arrangement or composition with his creditors; or

(d)      alcoholism or drug addiction of the Employee which impairs his ability to provide the services required hereunder; or

(e)      excessive and unreasonable absence of the Employee from the performance of the services for any reason other than for absence or incapacity specifically allowed hereunder.

(f)      The breach of any clause or term, including but not limited to Section 6 of this Agreement and the attached Addendum (if any) to this Agreement

TERMINATION

8.1     The Employee shall be entitled to terminate this Agreement, at any time by giving 4 weeks notice in writing to the Board of Directors.

8.2     The Company shall be entitled to terminate this Agreement at any time without cause by giving Employee four (4) weeks notice in writing of the termination. In the event that Employee’s employment is terminated without cause, the Company shall pay to Employee (i) any salary and accrued vacation pay earned but unpaid as of the date of termination; (ii) a severance payment in an amount equal to seven months of the salary set forth in paragraph 4.1 if during the first year of this Agreement or eight months of the salary set forth in paragraph 4.1 if during the second or third year of this Agreement; (iii) the Bonus Amount; and (iv) any Annual Bonus earned by the Employee but unpaid on the date of termination. Items (i) and (ii) shall be paid on the date of termination. Item (iii) shall be paid within ninety (90) days after the date of termination. Item (iv) shall be paid on or before March 31^st. The Company shall have no further obligation to Employee hereunder. Employee acknowledges and agrees that the payments set forth herein constitute liquidated damages for termination of his employment without cause and shall be Employee’s sole and exclusive remedy.

OWNERSHIP AND USE OF WORK PRODUCTS

9.1     The Employee agrees that any work product produced by the Employee in furtherance of the business of the Company, developed by the Employee, will be the sole and exclusive property of the Company.

9.2     This Agreement does not apply to general techniques, formulae, concepts or method for which no equipment, supplies, facility or other resources or trade secret information of the Company was used and which was developed entirely on the Employee’s own time unless such general techniques, formulae, concepts or method relates directly to the actual or specifically targeted business of the Company.

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9.3     At any and all times during the term of this Agreement, the Employee will promptly, on the request of the Company, perform all such reasonable acts and execute and deliver all such documents that may be necessary to vest in the Company the entire right, title and interest in and to any such work products determined, by the Company, to be the exclusive property of the Company. Should any such services be rendered after expiration or termination of this Agreement, a reasonable fee, mutually agreed upon by the Employee and the Company, will be paid to the Employee on a per diem basis in addition to reasonable expenses incurred as a result of rendering such services.

RETURN OF PROPERTY

10.     In the event of termination of this Agreement, the Employee agrees to return to the Company any property, which may be in the possession or control of the Employee.

SURVIVAL

11.     Notwithstanding the termination of this Agreement for any reason whatsoever, the provisions of Section 5, 9, and 10 hereof and any other provision of this Agreement necessary to give efficacy thereto shall continue in full force and effect for 1 year following such termination.

NOTICE

12.     Any notice or other communication (each a “Communication”) to be given in connection with this Agreement shall be given in writing and will be given by personal delivery addressed as follows:

TO: The Neptune Society
4312 Woodman Avenue, Third Floor
Sherman Oaks, CA 91423
Attention: President

AND TO: Jerry Norman
1661 204th Ave, NE,
Sammamish, WA 98074

or at such other address as shall have been designated by Communication by either party to the other. Any Communication shall be conclusively deemed to have been received on the date of delivery. If the party giving any Communication knows or ought reasonably to know of any actual or threatened interruptions of the mails, any such Communication shall not be sent by mail but shall be given by personal delivery.

ENTIRE AGREEMENT

13.     This Agreement constitutes and expresses the whole agreement of the parties hereto with reference to the services of the Employee by the Company, and with reference to any of the matters or things herein provided for, or hereinbefore discussed or mentioned with reference to such services; all promises, representations, and understandings relative thereto being merged herein.

AMENDMENTS AND WAIVERS

14.     No amendment of this Agreement shall be valid or binding unless set forth in writing and duly executed by both parties hereto. No waiver or any breach of any provision of this Agreement shall be effective or binding unless made in writing and signed by the party purporting to give the same and, unless otherwise provided in the written waiver, shall be limited to the specific breach waived.

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BENEFIT OF AGREEMENT

15.     The provisions of this Agreement shall enure to the benefit of and be binding upon the legal personal representatives of the Employee and the successors and assigns of the Employee and the Company.

SEVERABILITY

16.     If any provision of this Agreement is deemed to be void or unenforceable, in whole or in part, it shall not be deemed to affect or impair the validity of any other provision of this Agreement, and each and every section, subsection and provision of this Agreement is hereby declared and agreed to be severable from each other and every other section, subsection or provision hereof and to constitute separate and distinct covenants. The Employee hereby agrees that all restrictions herein are reasonable and valid.

17.     This Agreement shall be governed by and construed in accordance with the laws of the State of California. The Company and the Employee hereby irrevocably consent to the jurisdiction of the courts of the State of California.

COPY OF AGREEMENT

18.     The Employee hereby acknowledges receipt of a copy of this Agreement duly signed by the Company.

NUMBER AND GENDER

19.     Wherever the singular is used in this Agreement it is deemed to include the plural and wherever the masculine is used it is deemed to include the feminine or body politic or corporate where the context or the parties so require.

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

THE NEPTUNE SOCIETY, INC. EMPLOYEE

                                                   
Authorized Signatory                                                    
Jerry Norman

                                                   
Witness

                                                   
Name

                                                   
Address

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Appendix A

        The Annual Bonus shall be determined by multiplying the Gross Bonus Amount by the Bonus Percentage.

A.     The Bonus Percentage.

        The Board of Directors has established five goals to be achieved during the calendar year 2005. Those goals are:

1. Generate $28 million in gross revenue;

2. Perform 2,692 at-need cases and generate $7 million in total services revenue;

3. Sell 20,000 new pre-need contracts and generate $19.95 million in pre-need revenue;

4. Achieve $1 million in net cash flow from operations and $2.5 million in EBITDA; and

5. Open eight (8) new locations.

        For each one of the above five goals that is achieved by the Company as of the end of the 2005 calendar year, the Employee shall be entitled to 20% of the Gross Bonus Amount as calculated below (the “Bonus Percentage”). For purposes of example only, if the Company achieves only one of the above five goals, the Bonus Percentage would be 20%; if the Company achieves three of the above five goals, the Bonus Percentage would be 60%.

B.     The Gross Bonus Amount.

        The Gross Bonus Amount will be a product of two figures: (1) the EBITDA multiplier times (2) the Employee’s annual, salary as set forth in paragraph 4.1. The EBITDA multiplier will be determined by the EBITDA achieved as follows:

EBITDA	EBITDA Multiplier
Less than $2,500,000	7.5%
$2,500,000	30%
$3,000,000	45%
$3,500,000	60%

        For purposes of example only, if the Company achieves EBITDA for the calendar year 2005 of $3,000,000, the Gross Bonus Amount shall be 75% of the annual salary set forth in paragraph 4.1.

C.     Bonus Amount Calculation Example.

        If the annual salary is $222,000 and the EBITDA is $3,000,000, the Gross Bonus Amount would be $166,500. If the Bonus Percentage is 60%, the Annual Bonus would be $99,900.

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EX-10.2

EXHIBIT 10.2

EMPLOYMENT AGREEMENT

        THIS AGREEMENT is effective March 1, 2005 and replaces the Employment Agreement entered into on June 1, 2004.

BETWEEN:

THE NEPTUNE SOCIETY, INC. a Florida corporation having its offices at 4312 Woodman Avenue, Third Floor, Sherman Oaks, CA 91423;

(the “Company”)

AND:

DANIEL M. SOLBERG, an individual having his residence at 4474 Woodman Ave, #13, Sherman Oaks, CA 91423.

(the “Employee”)

        WHEREAS, the Company wishes to obtain the services of the Employee, and the Employee is willing to provide his service to the Company upon the terms and conditions set forth in this Agreement.

        NOW THEREFORE, in consideration of the premises and mutual covenants and agreements herein set forth, the parties hereto mutually covenant and agree as follows:

CONTRACT FOR SERVICES

1.     The Company hereby engages the Employee to act as the Chief Financial Officer, Secretary and Treasurer of the Company. The Employee shall perform all duties incident to such position of Chief Financial Officer, Secretary and Treasurer and other duties as may reasonably be required from time to time by the Board of Directors of the Company.

2.     The Employee shall provide the services at the time and in the manner set forth herein. The Employee shall perform his duties out of the Sherman Oaks, California or Florida office of the Company, but the Company may, at its discretion, direct that the duties be provided on occasion in other locations. The Employee shall perform his duties as long as a suitable work permit is in effect from the appropriate governing authorities.

VACATION

3.     Under this Agreement, the Employee is entitled to four weeks vacation per year.

FEES AND EXPENSES

4.1     In consideration of the Employee providing his services as Chief Financial Officer, Secretary and Treasurer, the Company shall pay to the Employee $200,000 annually.

The Company shall provide directly to the Employee, at no cost, vehicle parking at the office site. Medical or health insurance benefits for the Employee and spouse shall be paid by the Company. The Employee will be directly responsible for all necessary travel, auto, and any other expenses incurred by the Employee in connection with the provision of the services hereunder, however, expenses required to be paid by the Company for specifically required Company work, the Employee shall furnish statements and receipts as a requirement for reimbursement.

(a)      Automobiles. The Company shall furnish the Employee with a vehicle. The Company will be responsible for maintaining insurance and registration on such vehicle.

(b)      Housing allowance. The Company shall also provide the Employee with a monthly housing allowance of $1,000. This amount is in addition to the annual compensation as stated above.

4.2     Annual Bonus. In addition to the annual compensation set forth in paragraph 4.1 and conditioned on the Employee being employed by the Company on December 31^st of the applicable year, the Employee shall be eligible to earn an annual bonus of up to a maximum of 100% of the Employee’s annual compensation (the “Annual Bonus”). The Annual Bonus shall be calculated based on achievement of yearly goals to be set by the Board of Directors on or before December 31^st of each year. The Annual Bonus, if any, shall be paid to the Employee on or before March ^31st of the calendar year following the year in which the goals are achieved even if the Employee is no longer employed by the Company on March 31^st. For the calendar year 2005, the goals set by the Board of Directors and the manner of calculating the Annual Bonus are attached hereto as Appendix A.

4.3     Stock Options. The stock options granted to Employee in paragraph 4.3 of the Employment Agreement between the Company and the Employee dated June 1, 2004 shall remain in force during the Term of this Agreement; however, the period of time that Employee shall be entitled to exercise those options shall be extended through and including May 31, 2008.

4.4     Long Term Incentive.

(1)     For purposes of this paragraph, the capitalized terms shall have the meanings set forth below:

(a)      “EBITDA” means Earnings Before Interest, Taxes, Depreciation and Amortization, calculated in accordance with U.S. Generally Accepted Accounting Principles. However, extraordinary or non-recurring expenses such as costs associated with the opening of a new office shall not be included in the EBITDA for purposes of this paragraph.

(b)      “Termination Date” means the date on which Employee’s employment terminates or the date on which this Agreement expires.

(c)      “Employment Period” means the period of time between the Effective Date of this Agreement and the Termination Date.

(d)      “Value” means EBITDA for the fiscal year ended immediately prior to the Termination Date, multiplied by 8.

(e)      “Base Value” means EBITDA for the year ended December 31, 2004, multiplied by 8. For purposes of this Agreement, EBITDA for the year ended December 31, 2004 is deemed to be $3,125,000, and Base Value is deemed to be $25,000,000.

(f)      “Increased Value” means the positive difference between Value and Base Value.

(2)      In addition to the annual compensation set forth in paragraph 4.1, Employee shall earn a one-time bonus equal to 1.5% of the Increased Value (the “Bonus Amount”). The Bonus Amount shall be paid in full within ninety (90) days of the Termination Date. For purposes of example

only, in the event the Termination Date is February 28, 2008, and EBITDA for the fiscal year ended immediately prior to February 28, 2008 is $6,000,000, Employee’s bonus shall be equal to $345,000, i.e., [($48,000,000-$25,000,000) x 1.5% = $23,000,000 x 1.5% = $345,000]

(3)     No Bonus Amount shall be earned by Employee or be payable hereunder in the event that:

(a)     Employee is terminated for cause; or

(b)      During the Employment Period, the Value of the Company has not increased by a minimum of 15% per year (as averaged over the Employment Period).

CONFIDENTIAL INFORMATION

5.     The Employee shall well and faithfully provide the service to the Company, and use his best efforts to promote the interest thereof and shall not disclose (either during the term of this Agreement or at any time thereafter) the private affairs of the Company or any trade secret of the Company, to any persons other than the Management of the Company, or as required in the normal course of business and shall not use (either during the continuance of this Agreement or at any time thereafter) for his own purposes, or for any purposes other than those of the Company, any information he may acquire with respect to the Company’s affairs. The Employee further agrees to execute such further and other agreements concerning the secrecy of the affairs of the Company or of any companies with which the Company is affiliated or associated, as the Management of the Company shall reasonably request. Furthermore, without restricting the generality of the foregoing, the Employee shall not either during the term of this Agreement or any time thereafter, directly or indirectly divulge to any person, firm or corporation:

(a)      any intellectual property, proprietary information, know-how, trade secrets, processes, product specifications, new product information or methods of doing business acquired in the course of providing the services hereunder;

(b)      any information with respect of Company personnel or organization, or any of the financial affairs or business plans of the Company; or

(c)      any information in respect of Company pricing policies, sales statistics, sales and marketing plans and strategies, profits, costs, or sourcing of clients.

TERM OF AGREEMENT

6.1     This Agreement shall become effective on the 1st day of March 2005, and shall continue until February 28, 2008 unless terminated upon mutual consent of the Employee and the Company, or until termination by the Employee or the Company in accordance with Sections 7 or 8, whichever is earlier.

6.2     At the Company’s option, this Agreement will be renewed for one additional 12 month term commencing March 1, 2008. The Company will provide the Employee with 90 days notice of exercising its option to renew.

BREACH OF AGREEMENT

7.     Without prejudice to any remedy the Company may have against the Employee for any breach or non-performance of this Agreement, the Company may terminate this Agreement, subject to Section 11, for breach by the Employee at any time effective immediately and without notice and without any payment for any compensation either by way of anticipated earnings or damage of any kind to him

whatsoever, save and except in respect of fees payable to the date of such termination. For the purposes of this paragraph, any one of the following events shall constitute breach of this Agreement sufficient for termination, provided however, that the following events shall not constitute the only reasons for termination:

(a)      being guilty of any dishonesty or gross neglect in the provision of the services hereunder; or

(b)      being convicted of any criminal offense, other than an offense which in the reasonable opinion of the Company does not affect his position as a representative of the Company; or

(c)      becoming bankrupt or making any arrangement or composition with his creditors; or

(d)      alcoholism or drug addiction of the Employee which impairs his ability to provide the services required hereunder; or

(e)      excessive and unreasonable absence of the Employee from the performance of the services for any reason other than for absence or incapacity specifically allowed hereunder.

(f)      The breach of any clause or term, including but not limited to Section 6 of this Agreement and the attached Addendum (if any) to this Agreement

TERMINATION

8.1     The Employee shall be entitled to terminate this Agreement, at any time by giving 4 weeks notice in writing to the C.E.O., C.O.O. or President of the Company.

8.2     The Company shall be entitled to terminate this Agreement at any time without cause by giving Employee four (4) weeks notice in writing of the termination. In the event that Employee’s employment is terminated without cause, the Company shall pay to Employee (i) any salary and accrued vacation pay earned but unpaid as of the date of termination; (ii) a severance payment in an amount equal to six months of the salary set forth in paragraph 4.1; (iii) the Bonus Amount; and (iv) any Annual Bonus earned by the Employee but unpaid on the date of termination. Items (i) and (ii) shall be paid on the date of termination. Item (iii) shall be paid within ninety (90) days after the date of termination. Item (iv) shall be paid on or before March 31^st. The Company shall have no further obligation to Employee hereunder. Employee acknowledges and agrees that the payments set forth herein constitute liquidated damages for termination of his employment without cause and shall be Employee’s sole and exclusive remedy.

OWNERSHIP AND USE OF WORK PRODUCTS

9.1     The Employee agrees that any work product produced by the Employee in furtherance of the business of the Company either developed solely by the Employee or jointly with any other party will be the sole and exclusive property of the Company.

9.2     The Company acknowledges that general knowledge and experience including general techniques, concepts, methods and formulae not developed for the Company’s specific application or work gained by the Employee prior to or in the course of his association with the Company, may be used by the Employee at any time prior to, during or subsequent to his association with the Company, unless a specific agreement to the contrary is entered into by the Employee and the Company.

9.3     This Agreement does not apply to general techniques, formulae, concepts or method for which no equipment, supplies, facility or other resources or trade secret information of the Company was used and which was developed entirely on the Employee’s own time unless such general techniques, formulae, concepts or method relates directly to the actual or specifically targeted business of the Company.

9.4     At any and all times, either during the term of this Agreement or after termination hereof, the Employee will promptly, on the request of the Company, perform all such reasonable acts and execute and deliver all such documents that may be necessary to vest in the Company the entire right, title and interest in and to any such work products determined, by the Company, to be the exclusive property of the Company. Should any such services be rendered after expiration or termination of this Agreement, a reasonable fee, mutually agreed upon by the Employee and the Company, will be paid to the Employee on a per diem basis in addition to reasonable expenses incurred as a result of rendering such services.

RETURN OF PROPERTY

10.     In the event of termination of this Agreement, the Employee agrees to return to the Company any property, which may be in the possession or control of the Employee.

SURVIVAL

11.     Notwithstanding the termination of this Agreement for any reason whatsoever the provisions of Section 5, 9, and 10 hereof and any other provision of this Agreement necessary to give efficacy thereto shall continue in full force and effect following such termination.

NOTICE

12.     Any notice or other communication (each a “Communication”) to be given in connection with this Agreement shall be given in writing and will be given by personal delivery addressed as follows:

TO: The Neptune Society
4312 Woodman Avenue, Third Floor
Sherman Oaks, CA 91423
Attention: President

AND TO: Daniel M. Solberg
4474 Woodman Ave, #13
Sherman Oaks, CA 91423

or at such other address as shall have been designated by Communication by either party to the other. Any Communication shall be conclusively deemed to have been received on the date of delivery. If the party giving any Communication knows or ought reasonably to know of any actual or threatened interruptions of the mails, any such Communication shall not be sent by mail but shall be given by personal delivery.

ENTIRE AGREEMENT

13.     This Agreement constitutes and expresses the whole agreement of the parties hereto with reference to the services of the Employee by the Company, and with reference to any of the matters or things herein provided for, or hereinbefore discussed or mentioned with reference to such services; all promises, representations, and understandings relative thereto being merged herein.

AMENDMENTS AND WAIVERS

14.     No amendment of this Agreement shall be valid or binding unless set forth in writing and duly executed by both parties hereto. No waiver or any breach of any provision of this Agreement shall be effective or binding unless made in writing and signed by the party purporting to give the same and, unless otherwise provided in the written waiver, shall be limited to the specific breach waived.

BENEFIT OF AGREEMENT

15.     The provisions of this Agreement shall ensure to the benefit of and be binding upon the legal personal representatives of the Employee and the successors and assigns of the Employee and the Company.

SEVERABILITY

16.     If any provision of this Agreement is deemed to be void or unenforceable, in whole or in part, it shall not be deemed to affect or impair the validity of any other provision of this Agreement, and each and every section, subsection and provision of this Agreement is hereby declared and agreed to be severable from each other and every other section, subsection or provision hereof and to constitute separate and distinct covenants. The Employee hereby agrees that all restrictions herein are reasonable and valid.

17.     This Agreement shall be governed by and construed in accordance with the laws of the State of California. The Company and the Employee hereby irrevocably consent to the jurisdiction of the courts of the State of California.

COPY OF AGREEMENT

18.     The Employee hereby acknowledges receipt of a copy of this Agreement duly signed by the Company.

NUMBER AND GENDER

19.     Wherever the singular is used in this Agreement it is deemed to include the plural and wherever the masculine is used it is deemed to include the feminine or body politic or corporate where the context or the parties so require.

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

THE NEPTUNE SOCIETY, INC. EMPLOYEE

                                                   
Authorized Signatory                                                    
Daniel M. Solberg

                                                   
Witness

                                                   
Name

                                                   
Address

Appendix A

        The Annual Bonus shall be determined by multiplying the Gross Bonus Amount by the Bonus Percentage.

A.    The Bonus Percentage.

        The Board of Directors has established five goals to be achieved during the calendar year 2005. Those goals are:

1. Generate $28 million in gross revenue;

2. Perform 2,692 at-need cases and generate $7 million in total services revenue;

3. Sell 20,000 new pre-need contracts and generate $19.95 million in pre-need revenue;

4. Achieve $1 million in net cash flow from operations and $2.5 million in EBITDA; and

5. Open eight (8) new locations.

        For each one of the above five goals that is achieved by the Company as of the end of the 2005 calendar year, the Employee shall be entitled to 20% of the Gross Bonus Amount as calculated below (the “Bonus Percentage”). For purposes of example only, if the Company achieves only one of the above five goals, the Bonus Percentage would be 20%; if the Company achieves three of the above five goals, the Bonus Percentage would be 60%.

B.    The Gross Bonus Amount.

        The Gross Bonus Amount will be a product of two figures: (1) the EBITDA multiplier times (2) the Employee’s annual, salary as set forth in paragraph 4.1. The EBITDA multiplier will be determined by the EBITDA achieved as follows:

EBITDA	EBITDA Multiplier
Less than $2,500,000	7.5%
$2,500,000	30%
$3,000,000	45%
$3,500,000	60%

        For purposes of example only, if the Company achieves EBITDA for the calendar year 2005 of $3,000,000, the Gross Bonus Amount shall be 75% of the annual salary set forth in paragraph 4.1.

C.    Bonus Amount Calculation Example.

        If the annual salary is $200,000 and the EBITDA is $3,000,000, the Gross Bonus Amount would be $150,000. If the Bonus Percentage is 60%, the Annual Bonus would be $90,000.

EX-10.3

EXHIBIT 10.3

EMPLOYMENT AGREEMENT

        THIS AGREEMENT is effective March 1, 2005 and replaces the Employment Agreement entered into on September 1, 2004 as amended on February 7, 2005.

BETWEEN:

THE NEPTUNE SOCIETY, INC. a Florida corporation having its offices at 4312 Woodman Avenue, Third Floor, Sherman Oaks, CA 91423;

(the “Company”)

AND:

JAMES FORD, an individual having his residence at 5210 Premiere Hills Circle, #233, Woodland Hills, CA 91364

(the “Employee”)

        WHEREAS, the Company wishes to obtain the services of the Employee, and the Employee is willing to provide his service to the Company upon the terms and conditions set forth in this Agreement.

        NOW THEREFORE, in consideration of the premises and mutual covenants and agreements herein set forth, the parties hereto mutually covenant and agree as follows:

CONTRACT FOR SERVICES

1.     The Company hereby engages the Employee to act as the Chief Operating Officer of the Company and shall perform all duties incident to such position of Chief Operating Officer and other duties as may reasonably be required from time to time by the C.E.O., C.F.O. or President of the Company.

2.     The Employee shall provide the services at the time and in the manner set forth herein. The Employee shall perform his duties out of the Sherman Oaks, California office or Florida office of the Company, but the Company may, at its discretion, direct that the duties be provided on occasion in other locations. The Employee shall perform his duties as long as a suitable work permit is in effect from the appropriate governing authorities.

VACATION

3.     Under this Agreement, the Employee is entitled to four weeks vacation per year.

FEES AND EXPENSES

4.1     In consideration of the Employee providing his services as Chief Operating Officer, the Company shall pay to the Employee an annual salary of $170,000 during the first year of this agreement, $176,800 during the second year of this agreement, and $183,872 during the third year of this agreement.

The Company shall provide directly to the Employee, at no cost medical or health benefits as described in the Neptune Employee Manual. The Employee will be directly responsible for all necessary travel, auto, and any other expenses incurred by the Employee in connection with the provision of the services hereunder, however, expenses required to be paid by the Company for specifically required Company work, the Employee shall furnish statements and receipts as a requirement for reimbursement.

4.2     Annual Bonus. In addition to the annual compensation set forth in paragraph 4.1, and conditioned on the Employee being employed by the Company on December 31 of the applicable year, the Employee shall be eligible to earn an annual bonus of up to a maximum of 60% of the Employee’s annual compensation (the “Annual Bonus”). The Annual Bonus shall be calculated based on achievement of yearly goals to be set by the Board of Directors on or before December 31^st of each year. The Annual Bonus, if any, shall be paid to the Employee on or before March 31^st of the calendar year following the year in which the goals are achieved even if the Employee is no longer employed by the Company on March 31^st. For the calendar year 2005, the goals set by the Board of Directors and the manner of calculating the Annual Bonus are attached hereto as Appendix A.

4.3     Long Term Incentive.

(1)     For purposes of this paragraph, the capitalized terms shall have the meanings set forth below:

(a)     “EBITDA” means Earnings Before Interest, Taxes, Depreciation and Amortization, calculated in accordance with U.S. Generally Accepted Accounting Principles. However, extraordinary or non-recurring expenses such as costs associated with the opening of a new office shall not be included in the EBITDA for purposes of this paragraph.

(b)     “Termination Date” means the date on which Employee’s employment terminates or the date on which this Agreement expires.

(c)     “Employment Period” means the period of time between the Effective Date of this Agreement and the Termination Date.

(d)     “Value” means EBITDA for the fiscal year ended immediately prior to the Termination Date, multiplied by 8.

(e)     “Base Value” means EBITDA for the year ended December 31, 2004, multiplied by 8. For purposes of this Agreement, EBITDA for the year ended December 31, 2004 is deemed to be $3,125,000, and Base Value is deemed to be $25,000,000.

(f)     “Increased Value” means the positive difference between Value and Base Value.

(2)      In addition to the annual compensation set forth in paragraph 4.1, Employee shall earn a one-time bonus equal to .75% of the Increased Value (the “Bonus Amount”). The Bonus Amount shall be paid in full within ninety (90) days of the Termination Date. For purposes of example only, in the event the Termination Date is February 28, 2008, and EBITDA for the fiscal year ended immediately prior to February 28, 2008 is $6,000,000, Employee’s bonus shall be equal to $172,500, i.e., [($48,000,000-$25,000,000) x .75% = $23,000,000 x .75% = $172,500]

(3)     No Bonus Amount shall be earned by Employee or be payable hereunder in the event that:

(a)     Employee is terminated for cause; or

(b)      During the Employment Period, the Value of the Company has not increased by a minimum of 15% per year (as averaged over the Employment Period).

CONFIDENTIAL INFORMATION

5.     The Employee shall well and faithfully provide the service to the Company, and use his best efforts to promote the interest thereof and shall not disclose (either during the term of this Agreement or at any time thereafter) the private affairs of the Company or any trade secret of the Company, to any persons other than the Management of the Company, or as required in the normal course of business and shall not use (either during the continuance of this Agreement or at any time thereafter) for his own purposes, or for any purposes other than those of the Company, any information he may acquire with respect to the Company’s affairs. The Employee further agrees to execute such further and other agreements concerning the secrecy of the affairs of the Company or of any companies with which the Company is affiliated or associated, as the Management of the Company shall reasonably request. Furthermore, without restricting the generality of the foregoing, the Employee shall not either during the term of this Agreement or any time thereafter, directly or indirectly divulge to any person, firm or corporation:

(a)      any intellectual property, proprietary information, know-how, trade secrets, processes, product specifications, new product information or methods of doing business acquired in the course of providing the services hereunder;

(b)      any information with respect of Company personnel or organization, or any of the financial affairs or business plans of the Company; or

(c)      any information in respect of Company pricing policies, sales statistics, sales and marketing plans and strategies, profits, costs, or sourcing of clients.

TERM OF AGREEMENT

6.     This Agreement shall become effective on the 1st day of March 2005, and shall continue until February 28, 2008 unless terminated upon mutual consent of the Employee and the Company, or until termination by the Employee or the Company in accordance with Sections 7 or 8, whichever is earlier.

BREACH OF AGREEMENT

7.     Without prejudice to any remedy the Company may have against the Employee for any breach or non-performance of this Agreement, the Company may terminate this Agreement, subject to Section 11, for breach by the Employee at any time effective immediately and without notice and without any payment for any compensation either by way of anticipated earnings or damage of any kind to him whatsoever, save and except in respect of fees payable to the date of such termination. For the purposes of this paragraph, any one of the following events shall constitute breach of this Agreement sufficient for termination, provided however, that the following events shall not constitute the only reasons for termination:

(a)     being guilty of any dishonesty or gross neglect in the provision of the services hereunder; or

(b)      being convicted of any criminal offense, other than an offense which in the reasonable opinion of the Company does not affect his position as a representative of the Company; or

(c)      becoming bankrupt or making any arrangement or composition with his creditors; or

(d)      alcoholism or drug addiction of the Employee which impairs his ability to provide the services required hereunder; or

(e)      excessive and unreasonable absence of the Employee from the performance of the services for any reason other than for absence or incapacity specifically allowed hereunder.

(f)      The breach of any clause or term, including but not limited to Section 6 of this Agreement and the attached Addendum (if any) to this Agreement

TERMINATION

8.1     The Employee shall be entitled to terminate this Agreement, at any time by giving 4 weeks notice in writing to the CEO., CFO or President of the Company.

8.2     The Company shall be entitled to terminate this Agreement at any time without cause by giving Employee four (4) weeks notice in writing of the termination. In the event that Employee’s employment is terminated without cause, the Company shall pay to Employee (i) any salary and accrued vacation pay earned but unpaid as of the date of termination; (ii) a severance payment in an amount equal to six months of the salary set forth in paragraph 4.1; (iii) the Bonus Amount; and (iv) any Annual Bonus earned by the Employee but unpaid on the date of termination. Items (i) and (ii) shall be paid on the date of termination. Item (iii) shall be paid within ninety (90) days after the date of termination. Item (iv) shall be paid on or before March 31^st. The Company shall have no further obligation to Employee hereunder. Employee acknowledges and agrees that the payments set forth herein constitute liquidated damages for termination of his employment without cause and shall be Employee’s sole and exclusive remedy.

OWNERSHIP AND USE OF WORK PRODUCTS

9.1     The Employee agrees that any work product produced by the Employee in furtherance of the business of the Company either developed solely by the Employee or jointly with any other party will be the sole and exclusive property of the Company.

9.2     The Company acknowledges that general knowledge and experience including general techniques, concepts, methods and formulae not developed for the Company’s specific application or work gained by the Employee prior to or in the course of his association with the Company, may be used by the Employee at any time prior to, during or subsequent to his association with the Company, unless a specific agreement to the contrary is entered into by the Employee and the Company.

9.3     This Agreement does not apply to general techniques, formulae, concepts or method for which no equipment, supplies, facility or other resources or trade secret information of the Company was used and which was developed entirely on the Employee’s own time unless such general techniques, formulae, concepts or method relates directly to the actual or specifically targeted business of the Company.

9.4     At any and all times, either during the term of this Agreement or after termination hereof, the Employee will promptly, on the request of the Company, perform all such reasonable acts and execute and deliver all such documents that may be necessary to vest in the Company the entire right, title and interest in and to any such work products determined, by the Company, to be the exclusive property of the Company. Should any such services be rendered after expiration or termination of this Agreement, a reasonable fee, mutually agreed upon by the Employee and the Company, will be paid to the Employee on a per diem basis in addition to reasonable expenses incurred as a result of rendering such services.

RETURN OF PROPERTY

10.     In the event of termination of this Agreement, the Employee agrees to return to the Company any property, which may be in the possession or control of the Employee.

SURVIVAL

11.     Notwithstanding the termination of this Agreement for any reason whatsoever the provisions of Section 5, 9, and 10 hereof and any other provision of this Agreement necessary to give efficacy thereto shall continue in full force and effect following such termination.

NOTICE

12.     Any notice or other communication (each a “Communication”) to be given in connection with this Agreement shall be given in writing and will be given by personal delivery addressed as follows:

TO: The Neptune Society
4312 Woodman Avenue, Third Floor
Sherman Oaks, CA 91423
Attention: President

AND TO: James Ford
5210 Premiere Hills Circle, # 233
Woodland Hills, CA 91364

or at such other address as shall have been designated by Communication by either party to the other. Any Communication shall be conclusively deemed to have been received on the date of delivery. If the party giving any Communication knows or ought reasonably to know of any actual or threatened interruptions of the mails, any such Communication shall not be sent by mail but shall be given by personal delivery.

ENTIRE AGREEMENT

13.     This Agreement constitutes and expresses the whole agreement of the parties hereto with reference to the services of the Employee by the Company, and with reference to any of the matters or things herein provided for, or hereinbefore discussed or mentioned with reference to such services; all promises, representations, and understandings relative thereto being merged herein.

AMENDMENTS AND WAIVERS

14.     No amendment of this Agreement shall be valid or binding unless set forth in writing and duly executed by both parties hereto. No waiver or any breach of any provision of this Agreement shall be effective or binding unless made in writing and signed by the party purporting to give the same and, unless otherwise provided in the written waiver, shall be limited to the specific breach waived.

BENEFIT OF AGREEMENT

15.     The provisions of this Agreement shall enure to the benefit of and be binding upon the legal personal representatives of the Employee and the successors and assigns of the Employee and the Company.

SEVERABILITY

16.     If any provision of this Agreement is deemed to be void or unenforceable, in whole or in part, it shall not be deemed to affect or impair the validity of any other provision of this Agreement, and each and every section, subsection and provision of this Agreement is hereby declared and agreed to be severable from each other and every other section, subsection or provision hereof and to constitute

separate and distinct covenants. The Employee hereby agrees that all restrictions herein are reasonable and valid.

17.     This Agreement shall be governed by and construed in accordance with the laws of the State of California. The Company and the Employee hereby irrevocably consent to the jurisdiction of the courts of the State of California.

COPY OF AGREEMENT

18.     The Employee hereby acknowledges receipt of a copy of this Agreement duly signed by the Company.

NUMBER AND GENDER

19.     Wherever the singular is used in this Agreement it is deemed to include the plural and wherever the masculine is used it is deemed to include the feminine or body politic or corporate where the context or the parties so require.

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

THE NEPTUNE SOCIETY, INC. EMPLOYEE

                                                   
Authorized Signatory                                                    
James Ford

                                                   
Witness

                                                   
Name

                                                   
Address

Appendix A

        The Annual Bonus shall be determined by multiplying the Gross Bonus Amount by the Bonus Percentage.

A.      The Bonus Percentage.

        The Board of Directors has established five goals to be achieved during the calendar year 2005. Those goals are:

1. Generate $28 million in gross revenue;

2. Perform 2,692 at-need cases and generate $7 million in total services revenue;

3. Sell 20,000 new pre-need contracts and generate $19.95 million in pre-need revenue;

4. Achieve $1 million in net cash flow from operations and $2.5 million in EBITDA; and

5. Open eight (8) new locations.

        For each one of the above five goals that is achieved by the Company as of the end of the 2005 calendar year, the Employee shall be entitled to 20% of the Gross Bonus Amount as calculated below (the “Bonus Percentage”). For purposes of example only, if the Company achieves only one of the above five goals, the Bonus Percentage would be 20%; if the Company achieves three of the above five goals, the Bonus Percentage would be 60%.

B.     The Gross Bonus Amount.

        The Gross Bonus Amount will be a product of two figures: (1) the EBITDA multiplier times (2) the Employee’s annual, salary as set forth in paragraph 4.1. The EBITDA multiplier will be determined by the EBITDA achieved as follows:

EBITDA	EBITDA Multiplier
Less than $2,500,000	7.5%
$2,500,000	30%
$3,000,000	45%
$3,500,000	60%

        For purposes of example only, if the Company achieves EBITDA for the calendar year 2005 of $3,000,000, the Gross Bonus Amount shall be 45% of the annual salary set forth in paragraph 4.1.

C.     Bonus Amount Calculation Example.

        If the annual salary is $170,000 and the EBITDA is $3,000,000, the Gross Bonus Amount would be $76,500. If the Bonus Percentage is 60%, the Annual Bonus would be $45,900.

EX-10.4

EXHIBIT 10.4

EMPLOYMENT AGREEMENT

        THIS AGREEMENT is effective March 1, 2005 and replaces the Employment Agreement entered into on February 1, 2004.

BETWEEN:

THE NEPTUNE SOCIETY, INC. a Florida corporation having its offices at 4312 Woodman Avenue, Third Floor, Sherman Oaks, CA 91423;

(the “Company”)

AND:

GARY I. HARRIS, an individual having his residence at 1001 S. Flagler Drive, Apt #302, West Palm Beach, Florida, 33401-6522

(the “Employee”)

        WHEREAS, the Company wishes to obtain the services of the Employee, and the Employee is willing to provide his service to the Company upon the terms and conditions set forth in this Agreement.

        NOW THEREFORE, in consideration of the premises and mutual covenants and agreements herein set forth, the parties hereto mutually covenant and agree as follows:

CONTRACT FOR SERVICES

1.     The Company hereby engages the Employee to act as the National Sales Manager of the Company. The Employee shall perform all duties incident to such position of National Sales Manager and other duties as may reasonably be required from time to time by the C.E.O., C.O.O. or President of the Company.

2.     The Employee shall provide the services at the time and in the manner set forth herein. The Employee shall perform his duties out of the Sherman Oaks, California office or Florida office of the Company, but the Company may, at its discretion, direct that the duties be provided on occasion in other locations. The Employee shall perform his duties as long as a suitable work permit is in effect from the appropriate governing authorities.

VACATION

3.     Under this Agreement, the Employee is entitled to four weeks vacation per year.

FEES AND EXPENSES

4.1     In consideration of the Employee providing his services as National Sales Manager, the Company shall pay to the Employee, a fee, plus applicable taxes (if any), of US $75,000 annually. Such compensation is to be paid monthly. The Employee will also be paid an override of $10 on each Pre-Need Contract sold. During the term of this Agreement, the Employee will be provided with a vehicle which is paid for and insured by the Company. The lease rate on the automobile is capped at $1,000 per month, any overage will be the responsibility of the Employee.

4.2      The Company shall provide directly to the Employee, at no cost, vehicle parking at the office site and medical or health benefits. The Employee will be directly responsible for all necessary travel, auto and any other expenses incurred by the Employee in connection with the provision of the services

hereunder, however, expenses required to be paid by the Company for specifically required Company work, the Employee shall furnish statements and receipts as a requirement for reimbursement.

(a)      Business and Travel Expenses. The Company shall provide the Employee with a monthly business and travel allowance of no less than $1,000. The Company shall promptly reimburse the Employee for all business, travel and entertainment expenses.

(b)      Entertainment Expenses. The Company shall provide the Employee with a monthly business and travel allowance of no less than $1,000.

(c)      Annual Bonus. In addition, for each calendar year that this agreement shall remain in effect beginning with January 1, 2005 and conditioned on the Employee being employed by the Company on December 31^st of the applicable year, the Employee can earn a bonus of up to a maximum of 10% of the Employee’s annual salary and sales overrides, net of reimbursement and car expenses (the “Annual Bonus”). The Annual Bonus will be based on the achievement of yearly goals to be set by the Board of Directors on or before December 31^st of each year. The Annual Bonus, if any, shall be paid to the Employee on or before March 31^st of the calendar year following the year in which the goals are achieved even if the Employee is no longer employed by the Company on March 31^st. For the calendar year 2005, the goals set by the Board of Directors and the manner of calculating the Annual Bonus are attached hereto as Appendix A.

4.3     Stock Options. Employee shall retain the 30,000 options granted pursuant to paragraph 4.3 of the employment agreement dated February 1, 2004 with an exercise price of $0.70 US per share, exercisable after February 1, 2005. However, if any of these options are exercised, the options will not be replaced by the Company. If the options are not exercised by Employee on or before May 31, 2008, said options shall lapse. For avoidance of doubt, the last sentence of paragraph 4.3 of the employment agreement dated February 1, 2004 will have no further force or effect.

4.4     Long Term Incentive.

(1)      For purposes of this paragraph, the capitalized terms shall have the meanings set forth below:

(a)      “EBITDA” means Earnings Before Interest, Taxes, Depreciation and Amortization, calculated in accordance with U.S. Generally Accepted Accounting Principles. However, extraordinary or non-recurring expenses such as costs associated with the opening of a new office shall not be included in the EBITDA for purposes of this paragraph.

(b)      “Termination Date” means the date on which Employee’s employment terminates or the date on which this Agreement expires.

(c)      “Employment Period” means the period of time between the Effective Date of this Agreement and the Termination Date.

(d)      “Value” means EBITDA for the fiscal year ended immediately prior to the Termination Date, multiplied by 8.

(e)      “Base Value” means EBITDA for the year ended December 31, 2004, multiplied by 8. For purposes of this Agreement, EBITDA for the year ended December 31, 2004 is deemed to be $3,125,000, and Base Value is deemed to be $25,000,000.

(f)      “Increased Value” means the positive difference between Value and Base Value.

(2)      In addition to the annual compensation set forth in paragraph 4.1, Employee shall earn a one-time bonus equal to .75% of the Increased Value (the “Bonus Amount”). The Bonus Amount shall be paid in full within ninety (90) days of the Termination Date. For purposes of example only, in the event the Termination Date is February 28, 2008, and EBITDA for the fiscal year ended immediately prior to February 28, 2008 is $6,000,000, Employee’s bonus shall be equal to $172,500, i.e., [($48,000,000-$25,000,000) x ..75% = $23,000,000 x .75% = $172,500]

(3)      No Bonus Amount shall be earned by Employee or be payable hereunder in the event that:

(a)      Employee is terminated for cause; or

(b)      During the Employment Period, the Value of the Company has not increased by a minimum of 15% per year (as averaged over the Employment Period).

CONFIDENTIAL INFORMATION

5.     The Employee shall well and faithfully provide the service to the Company, and use his best efforts to promote the interest thereof and shall not disclose (either during the term of this Agreement or at any time thereafter) the private affairs of the Company or any trade secret of the Company, to any persons other than the Management of the Company, or as required in the normal course of business and shall not use (either during the continuance of this Agreement or at any time thereafter) for his own purposes, or for any purposes other than those of the Company, any information he may acquire with respect to the Company’s affairs. The Employee further agrees to execute such further and other agreements concerning the secrecy of the affairs of the Company or of any companies with which the Company is affiliated or associated, as the Management of the Company shall reasonably request. Furthermore, without restricting the generality of the foregoing, the Employee shall not either during the term of this Agreement or any time thereafter, directly or indirectly divulge to any person, firm or corporation:

(a)      any intellectual property, proprietary information, know-how, trade secrets, processes, product specifications, new product information or methods of doing business acquired in the course of providing the services hereunder;

(b)      any information with respect of Company personnel or organization, or any of the financial affairs or business plans of the Company; or

(c)      any information in respect of Company pricing policies, sales statistics, sales and marketing plans and strategies, profits, costs, or sourcing of clients.

TERM OF AGREEMENT

6.     This Agreement shall become effective on the 1st day of March, 2005, and shall continue until February 28, 2008 unless terminated upon mutual consent of the Employee and the Company, or until termination by the Employee or the Company in accordance with Sections 7 or 8, whichever is earlier.

BREACH OF AGREEMENT

7.     Without prejudice to any remedy the Company may have against the Employee for any breach or non-performance of this Agreement, the Company may terminate this Agreement, subject to Section 11, for breach by the Employee at any time effective immediately and without notice and without any payment for any compensation either by way of anticipated earnings or damage of any kind to him whatsoever, save and except in respect of fees payable to the date of such termination. For the purposes of this paragraph, any one of the following events shall constitute breach of this Agreement sufficient for

termination, provided however, that the following events shall not constitute the only reasons for termination:

(a)      being guilty of any dishonesty or gross neglect in the provision of the services hereunder; or

(b)      being convicted of any criminal offense, other than an offense which in the reasonable opinion of the Company does not affect his position as a representative of the Company; or

(c)      becoming bankrupt or making any arrangement or composition with his creditors; or

(d)      alcoholism or drug addiction of the Employee which impairs his ability to provide the services required hereunder; or

(e)      excessive and unreasonable absence of the Employee from the performance of the services for any reason other than for absence or incapacity specifically allowed hereunder.

(F)       The breach of any clause or term, including but not limited to Section 6 of this Agreement and the attached Addendum (if any) to this Agreement

TERMINATION

8.1     The Employee shall be entitled to terminate this Agreement, at any time by giving 4 weeks notice in writing to the CEO or President of the Company.

8.2     The Company shall be entitled to terminate this Agreement at any time without cause by giving Employee four (4) weeks notice in writing of the termination. In the event that Employee’s employment is terminated without cause, the Company shall pay to Employee (i) any salary and accrued vacation pay earned but unpaid as of the date of termination; (ii) a severance payment in an amount equal to six months of the salary set forth in paragraph 4.1; (iii) the Bonus Amount; and (iv) any Annual Bonus earned by the Employee but unpaid on the date of termination. Items (i) and (ii) shall be paid on the date of termination. Item (iii) shall be paid within ninety (90) days after the date of termination. Item (iv) shall be paid on or before March 31^st. The Company shall have no further obligation to Employee hereunder. Employee acknowledges and agrees that the payments set forth herein constitute liquidated damages for termination of his employment without cause and shall be Employee’s sole and exclusive remedy.

OWNERSHIP AND USE OF WORK PRODUCTS

9.1     The Employee agrees that any work product produced by the Employee in furtherance of the business of the Company either developed solely by the Employee or jointly with any other party will be the sole and exclusive property of the Company.

9.2      The Company acknowledges that general knowledge and experience including general techniques, concepts, methods and formulae not developed for the Company’s specific application or work gained by the Employee prior to or in the course of his association with the Company, may be used by the Employee at any time prior to, during or subsequent to his association with the Company, unless a specific agreement to the contrary is entered into by the Employee and the Company.

9.3      This Agreement does not apply to general techniques, formulae, concepts or method for which no equipment, supplies, facility or other resources or trade secret information of the Company was used and which was developed entirely on the Employee’s own time unless such general techniques, formulae, concepts or method relates directly to the actual or specifically targeted business of the Company.

9.4     At any and all times, either during the term of this Agreement or after termination hereof, the Employee will promptly, on the request of the Company, perform all such reasonable acts and execute and deliver all such documents that may be necessary to vest in the Company the entire right, title and interest in and to any such work products determined, by the Company, to be the exclusive property of the Company. Should any such services be rendered after expiration or termination of this Agreement, a reasonable fee, mutually agreed upon by the Employee and the Company, will be paid to the Employee on a per diem basis in addition to reasonable expenses incurred as a result of rendering such services.

RETURN OF PROPERTY

10.     In the event of termination of this Agreement, the Employee agrees to return to the Company any property, which may be in the possession or control of the Employee.

SURVIVAL

11.     Notwithstanding the termination of this Agreement for any reason whatsoever the provisions of Section 5, 9, and 10 hereof and any other provision of this Agreement necessary to give efficacy thereto shall continue in full force and effect following such termination.

NOTICE

12.     Any notice or other communication (each a “Communication”) to be given in connection with this Agreement shall be given in writing and will be given by personal delivery addressed as follows:

TO: The Neptune Society
4312 Woodman Avenue, Third Floor
Sherman Oaks, CA 91423
Attention: President

AND TO: Gary I. Harris
1001 S. Flagler Drive, #302
West Palm Beach, FL 33401-6522

or at such other address as shall have been designated by Communication by either party to the other. Any Communication shall be conclusively deemed to have been received on the date of delivery. If the party giving any Communication knows or ought reasonably to know of any actual or threatened interruptions of the mails, any such Communication shall not be sent by mail but shall be given by personal delivery.

ENTIRE AGREEMENT

13.     This Agreement constitutes and expresses the whole agreement of the parties hereto with reference to the services of the Employee by the Company, and with reference to any of the matters or things herein provided for, or hereinbefore discussed or mentioned with reference to such services; all promises, representations, and understandings relative thereto being merged herein.

AMENDMENTS AND WAIVERS

14.     No amendment of this Agreement shall be valid or binding unless set forth in writing and duly executed by both parties hereto. No waiver or any breach of any provision of this Agreement shall be effective or binding unless made in writing and signed by the party purporting to give the same and, unless otherwise provided in the written waiver, shall be limited to the specific breach waived.

BENEFIT OF AGREEMENT

15.     The provisions of this Agreement shall enure to the benefit of and be binding upon the legal personal representatives of the Employee and the successors and assigns of the Employee and the Company.

SEVERABILITY

16.     If any provision of this Agreement is deemed to be void or unenforceable, in whole or in part, it shall not be deemed to affect or impair the validity of any other provision of this Agreement, and each and every section, subsection and provision of this Agreement is hereby declared and agreed to be severable from each other and every other section, subsection or provision hereof and to constitute separate and distinct covenants. The Employee hereby agrees that all restrictions herein are reasonable and valid.

17.     This Agreement shall be governed by and construed in accordance with the laws of the State of California. The Company and the Employee hereby irrevocably consent to the jurisdiction of the courts of the State of California.

COPY OF AGREEMENT

18.     The Employee hereby acknowledges receipt of a copy of this Agreement duly signed by the Company.

NUMBER AND GENDER

19.     Wherever the singular is used in this Agreement it is deemed to include the plural and wherever the masculine is used it is deemed to include the feminine or body politic or corporate where the context or the parties so require.

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

THE NEPTUNE SOCIETY, INC. EMPLOYEE

                                                   
Authorized Signatory                                                    
Gary I. Harris

                                                   
Witness

                                                   
Name

                                                   
Address

Appendix A

        The Annual Bonus shall be determined by multiplying the Gross Bonus Amount by the Bonus Percentage.

A.    The Bonus Percentage.

        The Board of Directors has established five goals to be achieved during the calendar year 2005. Those goals are:

1. Generate $28 million in gross revenue;

2. Perform 2,692 at-need cases and generate$7 million in total services revenue;

3. Sell 20,000 new pre-need contracts and generate $19.95 million in pre-need revenue;

4. Achieve $1 million in net cash flow from operations and $2.5 million in EBITDA; and

5. Open eight (8) new locations.

        For each one of the above five goals that is achieved by the Company as of the end of the 2005 calendar year, the Employee shall be entitled to 20% of the Gross Bonus Amount as calculated below (the “Bonus Percentage”). For purposes of example only, if the Company achieves only one of the above five goals, the Bonus Percentage would be 20%; if the Company achieves three of the above five goals, the Bonus Percentage would be 60%.

B.     Bonus Amount Calculation Example.

        If the annual salary is $200,000, the Gross Bonus Amount would be $20,000. If the Bonus is 60%, the Annual Bonus would be $12,000.