EMPLOYMENT AGREEMENT
Exhibit
10.11
This
EMPLOYMENT AGREEMENT is made and entered into as of the date last written below,
between CLEANTECH BIOFUELS, INC., a Delaware corporation (the
“Company”), and Xxx Xxxxxxxxx (the
“Employee”).
WHEREAS,
the Company desires to retain the services of Employee as Chief Financial
Officer, and Employee desires to be employed by the Company as Chief Financial
Officer, upon the terms and conditions hereinafter set forth; and
WHEREAS,
as an integral part of this Agreement, the Company desires to obtain Employee’s
covenant not to compete and other covenants, and Employee desires to make a
covenant not to compete and such other covenants as hereinafter set
forth.
NOW,
THEREFORE, in consideration of the premises and agreements herein
contained, and other good and valuable consideration, the receipt and adequacy
of which are hereby forever acknowledged and confessed, the parties agree as
follows:
1. Employment.
The Company hereby employs Employee, and Employee hereby accepts such
employment by the Company, upon the terms and conditions specified herein for
the Term of Employment (as hereinafter defined).
2. Duties
of Employee. During the Term of Employment,
Employee is hereby employed as Chief Financial Officer. Employee
shall report directly to the Company’s Chief Executive Officer. In
furtherance of the foregoing, Employee shall, subject to the direction and
instruction of the Company: (a) devote Employee’s full and entire
working time, attention and energies to the Company, and will diligently and
to
the best of employee’s ability perform all duties incident to Employee’s
employment hereunder; (b) use Employee’s best efforts to promote the interests
of the Company; and (c) perform such other duties as the Company may from time
to time direct.
3. Financial
Arrangements.
3.1 Compensation. As
compensation for Employee’s services hereunder and in consideration of
Employee’s covenant not to compete and other covenants as set forth in that
Section of this Agreement entitled Restrictive Covenants hereof, the
Company shall pay Employee a salary of One Dollar $1.00 per year, payable on
at
least a annual basis, subject to such payroll and withholding deductions as
may
be required by law or as otherwise authorized by Employee in
writing. Employee’s compensation arrangement will be reviewed
annually by the Board of Directors and may be increased, but not decreased,
in
the sole discretion of the Board of Directors.
3.2 Bonus.
In addition to the salary payable to Employee described in that Subsection
of this Agreement entitled Compensation, the Company may pay Employee a
bonus in accordance with any bonus compensation program as adopted from time
to
time by the Company (the “Bonus”). The
Company shall determine the amount of and pay the Bonus, if any, to Employee
in
accordance with any bonus compensation program then in effect. The
payment of the Bonus, if any, is subject to such payroll and withholding
deductions as may be required by law or as otherwise authorized by Employee
in
writing.
3.3 Expenses. Throughout
the term of Employee’s employment hereunder, the Company shall reimburse
Employee for all reasonable and necessary travel, entertainment, and other
business expenses which may be incurred in direct connection with the
performance of Employee’s duties in accordance with policies adopted from time
to time by the Company concerning expense reimbursement for
employees. Such expenses as are authorized for payment or
reimbursement shall be paid for by the Company or reimbursed to Employee upon
presentation to the Company of an itemized expense statement with respect
thereto.
3.4 Fringe
Benefits. Employee shall be eligible to participate with other
employees of the Company, so long as Employee meets the applicable eligibility
requirements, in such employee fringe benefits as may be authorized and adopted
from time to time by the Board of Directors of the Company, including but not
limited to the Company’s 2007 Stock Option Plan. Employee shall be
entitled to three weeks paid vacation per year.
4. Definitions.
4.1 As
used herein, the term “Confidential Information” shall
mean any information obtained at any time while Employee is or was employed
by
the Company which is not generally known and which is proprietary to the
Company, including, but is not limited to, trade secrets, Inventions (as defined
herein), information pertaining to research, computer software, development,
techniques, engineering, purchasing, marketing, selling, accounting, licensing,
specialized know-how, processes, discoveries, products, equipment, models,
prototypes, devices, computer programs, lists of employees, mailing lists,
details of contracts, cost systems, pricing policies, operational methods,
marketing plans, business acquisition plans, customer lists, the particular
needs and requirements of customers, and the identity of customers and potential
customers. All information designated or treated as Confidential
Information or as a trade secret by the Company shall, regardless of its source,
be deemed Confidential Information for all purposes.
4.2 As
used herein, the term “Inventions” shall mean all
ideas, discoveries, and improvements, whether or not shown or described in
writing or reduced to practice or use, and whether or not patentable, relating
in any manner to any of the Company’s present or future products, computer
software, services, manufacturing, or research.
5. Restrictive
Covenants.
5.1 Non-Disclosure.
Employee represents and warrants that Employee is free of any contractual
restrictions and restraints in entering this Agreement, and has not, and will
not, in connection with his or her employment with the Company divulge any
confidential information, trade secrets, or copyright-protected information
of
any prior employer or of any other third party to whom Employee owes an
obligation of confidentiality.
Employee
recognizes Employee’s responsibility to protect all of the Company’s
Confidential Information and agrees to use his or her best efforts and to
exercise utmost diligence to protect and guard the Confidential Information
of
the Company and any subsidiaries or affiliated companies. Employee
agrees to hold in strictest and total confidence all Confidential
Information. Employee will at no time, without prior written
authorization by the Company, disclose or in any way transfer or communicate,
or
use for the benefit of any person or entity other than the Company, any
Confidential Information.
5.2 Return
of Confidential Information. Upon termination of employment with the
Company or at any other time upon the Company’s request, Employee shall promptly
return to the Company all originals and all copies (including photocopies,
facsimiles, and computer or other means of electronic storage) of all materials
relating in any way to Confidential Information or the business of the Company
or any affiliated companies and subsidiaries of the Company, and will so
represent to the Company upon termination of employment.
5.3 Work
Product. Employee shall promptly and fully disclose to the
Company and Employee shall hold in trust for the Company’s sole right and
benefit any Invention that Employee makes, conceives, or reduces to practice,
or
causes to be made, conceived, or reduced to practice during the period when
Employee is or was employed with the Company; provided, however, that this
disclosure obligation shall only be applicable to those Inventions that relate
in any manner to subject matter pertaining to Employee’s employment, or that
relate in any manner or are directly or indirectly connected with the business,
services, products, projects, or Confidential Information of the Company, or
that involve in any manner the use of any time, material, or facilities of
the
Company, or services of any of the Company’s Employees during normal working
hours.
All
items, including without limitation software, specifications, drawings, samples,
tools, technical information, or data, regardless of format or medium, prepared
or originated by or for Employee specifically for the Company at the Company’s
request in connection with his or her employment shall be the exclusive property
of the Company and shall be deemed to be works for hire, and to the extent
they
may not be works for hire, Employee assigns to the Company all rights, title,
and interest in and to such items (“Work Product”),
including rights to copyright. Employee hereby assigns to the Company
all of Employee’s right, title and interest in and to all Work Product and
Inventions that are subject to the disclosure obligations hereof and hereby
agrees, upon the Company’s request, to execute, verify, and deliver to the
Company documents including, but not limited to, assignments and applications
for Letters of Patent, and to perform such other acts, including, but not
limited to, appearing as a witness in any action brought in connection with
this
Agreement, that is deemed reasonably necessary or appropriate by the Company
to
allow it to obtain the sole right, title, interest and benefit of all such
Work
Product and Inventions.
The
assignment of Work Product and Inventions herein and Employee’s agreements in
connection therewith shall not apply to any Invention for which: (i) no
equipment, supplies, facilities, or Confidential Information of the Company
or
services of any of the Company’s Employees during normal working hours was used;
(ii) was developed entirely on Employee’s own time; (iii) does not relate to (a)
the business of the Company or (b) the Company’s actual or demonstratively
anticipated research or development; and (iv) which does not result
from any work performed by Employee for the Company.
5.4 Competition. Employee
recognizes that the Company’s entering into this Agreement is induced primarily
because of the covenants and assurances made by Employee, that Employee’s
covenant not to compete is necessary to insure that continuation of the business
of the Company and its subsidiaries and/or affiliates, and that irreparable
harm
and damage will be done to the Company and its subsidiaries and/or affiliates
in
the event that Employee competes with the Company or its subsidiaries and/or
affiliates.
During
the Term of Employment (as defined below) and for a period of 1 year thereafter,
Employee shall not, directly or indirectly, enter into or participate (whether
as owner, partner, shareholder, officer, director, salesman, consultant,
employee, principal or in any other relationship or capacity) in any business,
operating or providing services within the United States which is in direct
competition with the Company or its subsidiaries and/or affiliates, including
without limitation, any business which competes directly with the Company’s
business as being conducted at such time.
Company
and Employee understand and agree that the scope and duration of the covenants
contained in this Section of this Agreement entitled Restrictive
Covenants are reasonable both in time and geographical area and are fairly
necessary to protect the Company’s legitimate business
interests. Such covenants shall survive the termination of Employee’s
employment except as otherwise provided herein. The parties further
agree that such covenants shall be regarded as divisible and shall be operative
as to time and geographical area to the extent that they may be made so and,
if
any part of such covenants is declared invalid or unenforceable, the validity
and enforceability of the remainder shall not be affected. Employee
hereby warrants to Company that Employee’s compliance with each of the
restrictive covenants set forth in this Agreement will not, upon the
termination, of Employee’s employment with the Company for any reason
whatsoever, cause Employee to be unable to earn a living that is suitable and
acceptable to Employee.
5.5 Non-Solicitation.
Because the Company’s Employees are a valuable resource the loss of whom could
cause significant harm to the Company’s business, Employee agrees that during
the term of Employee’s employment with the Company, and for a period of 1 year
thereafter, Employee will not be materially involved in any manner in the
recruitment or hiring or any attempt to recruit or hire as an employee, officer,
director, consultant, or advisor any person who is at the time or 12 months
prior thereto had been an Employee or consultant of the Company.
5.6 Non-Disparagement. Employee
shall not disparage the business reputation of the Company (or its management
team) or take any actions that are harmful to the Company’s goodwill with its
customers, content providers, network infrastructure providers, vendors,
employees, the media or the public.
5.7 Enforcement. Company
spends considerable amounts of time, money and effort in developing and
maintaining good will in its industry. Employee agrees the covenants
set forth in the Section of this Agreement entitled Restrictive
Covenants: (i) are reasonable and necessary in all respects to
protect the goodwill, trade secrets, confidential information, and business
interests of Company; (ii) are not oppressive to Employee; and (iii) do not
impose any greater restraint on Employee than is reasonably necessary to protect
the goodwill, trade secrets, confidential information and legitimate business
interests of Company.
Without
limiting other possible remedies to the Company for the breach of this
Agreement, Employee agrees that injunctive or other equitable relief shall
be
available to enforce the covenants set forth in this Section of this Agreement
entitled Restrictive Covenants, such relief to be without the necessity
of posting a bond, cash or otherwise. Employee further agrees
that if any restriction contained in the Section of this Agreement entitled
Restrictive Covenants is held by any court to be unenforceable or
unreasonable, a lesser restriction shall be severable therefrom and be enforced
in its place, and all remaining restrictions contained herein shall be enforced
independently of each other.
If
any
party shall commence a proceeding (whether in arbitration or in court) against
the other to enforce and/or recover damages for breach of this Agreement, the
prevailing party in such proceeding shall be entitled to recover from the other
party all reasonable costs and expenses of enforcement and collection of any
and
all remedies and damages, or all reasonable costs and expenses of defense,
as
the case may be. The foregoing costs and expenses shall include
reasonable attorneys’ fees.
6. Term
and Termination of Agreement.
6.1 Term
of Employment. The term of this Agreement (the “Term
of Employment”) shall commence effective as of the date hereof
(the “Commencement Date”), and shall continue until
the third anniversary of the Commencement Date, unless extended or earlier
terminated as hereinafter provided. This Agreement shall be
automatically extended for successive 1 year periods at the end of the initial
term and each extended term thereafter, subject to the termination provisions
in
Section 6.2 hereof.
6.2 Termination. Notwithstanding
any other provision of this Subsection of this Agreement entitled
Termination, Employee’s obligations pursuant to that Section of this
Agreement entitled Restrictive Covenants shall continue in full force
and effect after termination of Employee’s employment or expiration of this
Agreement.
(a) Death. Employee’s
employment hereunder shall terminate immediately upon death.
(b) For
Cause. The Company may terminate Employee’s employment hereunder at any
time, effective immediately upon written notice, for cause. For the
purpose of this Agreement “cause” shall
mean:
i. The
willful and continued failure by Employee to substantially perform Employee’s
duties hereunder other than any such failure resulting from Employee’s
incapacity due to physical or mental illness or resulting from a diminution
of
Employee’s duties following a Change of Control (as defined below);
ii. The
willful engaging by Employee in conduct which is demonstrably and materially
injurious to the Company, monetarily or otherwise;
iii. Actions
of Employee which constitute a breach of that Section of this Agreement entitled
Restrictive Covenants; or
iv. Employee’s
conviction of, or plea of nolo contendere to a felony, provided any right of
appeal has been exercised or has lapsed.
In
the
event that Employee is terminated for cause, the Company shall pay Employee’s
salary through the date of termination, and shall thereafter have no further
obligation to Employee. For purposes of this Subsection of this
Agreement entitled Termination, no act, or failure to act, on the part
of the Employee shall be deemed “willful” unless done,
or omitted to be done, by the Employee without good faith and without reasonable
belief that the action or omission was in the best interest of the
Company.
(c) For
Change of Control. For purposes of this Agreement, a
“Change of Control” shall mean and be deemed to have
occurred if:
i. The
acquisition by any person, entity or “group” within the meaning of Section 13(d)
or 14(d) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), other than a person, entity or
“group” that includes Employee, of beneficial ownership
(within the meaning of
Rule 13d-3 promulgated under the Exchange Act) of two-thirds or more of the
Company’s then outstanding voting securities; or
ii. If
the individuals who serve on the Board of Directors as of the Commencement
Date
(the “Incumbent Board”) cease for any reason to
constitute at least a majority of the Board of Directors; provided, however,
any
person who becomes a director subsequent to the Commencement Date, whose
election or nomination for election was approved by a vote of at least a
majority of the directors then constituting the Incumbent Board, shall for
purposes of this Agreement be considered a member of the Incumbent Board;
or
iii. Approval
by the Company’s equity holders of (A) a merger, reorganization or consolidation
whereby the Company’s equity holders immediately prior to such approval do not,
immediately after consummation of such reorganization, merger or consolidation
own more than 50% of the combined voting power of the surviving entity’s then
outstanding voting securities entitled to vote generally in the election of
directors; or (B) the sale of all or substantially all of the assets of the
Company.
Notwithstanding
anything to the contrary herein, a Change of Control shall not be deemed to
have
occurred if the Company sells substantially all of its assets for less than
the
amount of capital (whether in cash or other property) contributed by
shareholders to the Company.
For
purposes of this Agreement, “Change of Control Date”
shall mean the date of the Change of Control. If a Change of Control
occurs and if the Employee’s employment with the Company is terminated prior to
the date on which the Change of Control occurs, and if it is reasonably
demonstrated by Employee that such termination of employment: (i) was
at the request of a third party who has taken steps reasonably calculated to
effect a Change of Control, or (ii) otherwise arose in connection with or
anticipation of a Change of Control, then for all purposes of this Agreement,
“Change of Control Date” shall mean the date immediately prior to the date of
such termination of employment, and a Change of Control shall be deemed to
have
occurred on the Change of Control Date.
Following
a Change of Control Date, if: (i) Employee is terminated without
cause, or (ii) Employee terminates his employment subsequent to the Company
assigning Employee duties which are inconsistent with Employee’s position
(including status, offices, titles, or reporting requirements), or the Company
takes action which results in a material dimunition of Employee’s position,
authority, duties, or responsibilities, then the Company shall be obligated
to
pay to Employee as severance pay an amount equal to Employee’s salary in effect
upon said termination for the next twelve consecutive months, payable
periodically at the same payroll cycle as the Company’s other
employees.
(d) Long-Term
Disability. Employee’s employment hereunder shall terminate
immediately should Employee commence a Long-Term Disability, as hereinafter
defined. Employee shall have commenced a “Long-Term
Disability” if: (i) Employee cannot perform the essential
functions of his employment position, with or without a reasonable accommodation
for his disability; or (ii) Employee cannot perform the essential functions
of
his employment position without an accommodation that would be an undue hardship
for the Company to provide. The foregoing definition of Long-Term
Disability is not intended to and shall not affect the definition of
“disability” or any similar term in any insurance policy the Company may
provide.
(e) Without
Cause. Employee’s employment hereunder may be terminated by the
Company at any time, effective upon written notice of termination. In
the event that Employee is terminated without cause, the Company shall pay
Employee’s salary through the date of termination, and then the Company shall be
obligated to pay to Employee as severance pay an amount equal to Employee’s
salary in effect upon said termination for the next twelve consecutive months,
payable periodically at the same payroll cycle as the Company’s other
employees.
(f) By
Employee. Employee may terminate this Agreement upon providing
Company with 15 days written notice.
i. Termination
by Employee with Good Reason. The Employee may terminate his
employment for Good Reason (as defined herein) at any time during the term
of
this Agreement, by giving written notice to the Company thereof. Such
termination shall become effective immediately upon notice. In the
event that Employee terminates his employment for Good Reason, the Company
shall
pay Employee his Base Salary (as in effect on the date of termination and
excluding any bonus payment) for a period of twelve (12) months following the
date of such termination. Employee shall execute a release in favor
of Company, and the Company shall have no further obligations to the Employee
under this Agreement except as otherwise may be provided under the Stock Option
Plan or any Option Agreement between Company and Employee.
ii. Termination
by Employee without Good Reason. The Employee may terminate his
employment at any time, by giving advance written notice to the Company. Any
such termination shall become effective on the date specified in such notice,
which shall not be earlier than ninety (90) days after the date of such notice
(or such earlier date that the Company may determine in its sole discretion),
and the Employee shall continue to perform his duties pursuant to the terms
of
this Agreement for such period. In the event that Employee terminates
his employment without Good Reason, the Company shall pay Employee’s salary
through the date of termination, and shall thereafter have no further obligation
to Employee.
iii. For
purposes of this Agreement, “Good Reason” shall mean, without Employee’s consent
(A) a reduction by the Company in Employee’s Base Salary pursuant to the terms
of this Agreement; (B) requiring Employee to relocate more than 50 miles from
St. Louis, Missouri; (C) the failure of Company to permit Employee to
participate in Company’s benefit plans on a basis consistent with other Company
employees holding similar positions as that of Employee; or (D) the failure
by
Company to obtain the assumption of this Agreement by any successor of
Company.
7. Additional
Provisions.
7.1 Notices. Any
notice, demand, or communication required, permitted, or desired to be given
hereunder, shall be deemed effectively given when personally delivered or when
mailed by prepaid, certified mail, return receipt requested, addressed as
follows:
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Employee
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Company
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________________________
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_________________________
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________________________
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_________________________
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________________________
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_________________________
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or
to
such other address, and to the attention of such other person(s) or officer(s)
as either party may designate by written notice.
7.2 Governing
Law. This Agreement has been executed and delivered in, and
shall be interpreted, construed, and enforced pursuant to and in accordance
with
the laws of Missouri, without reference to conflict of laws rules or
principles.
7.3 Assignment. This
Agreement and the rights and obligations hereunder shall bind and inure to
the
benefit of any successor or successors of the Company by way of reorganization,
merger or consolidation, and any assignee of all or substantially all of its
business and properties, but, except as to any such successor or assignee of
the
Company, neither this Agreement nor any rights or benefits hereunder may be
assigned by either party.
7.4 Waiver
of Breach. The waiver by either party of a breach or violation
of any provision of this Agreement shall not operate as, or be construed to
be,
a waiver of any subsequent breach of the same or other provision
hereof.
7.5 Headings;
Gender and Number. The headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Whenever the context hereof
requires, the gender of all words shall include the masculine, feminine and
neuter, and the number of all words shall include the singular and
plural.
7.6 Additional
Assurances. The provisions of this Agreement shall be
self-operative and shall not require further agreement by the parties except
as
may be herein specifically provided to the contrary; provided, however, at
the
request of the Company, Employee shall execute such additional instruments
and
take such additional acts as the Company may deem necessary to effectuate this
Agreement.
7.7 Severability. In
the event any provision of this Agreement is held to be unenforceable for any
reason, the unenforceability thereof shall not effect the remainder of this
Agreement, which shall remain in full force and effect and enforceable in
accordance with its terms.
7.8 Entire
Agreement. This Employment Agreement supersedes all previous
agreements, and constitutes the entire Agreement between
parties. Employee shall be entitled to no other benefits than those
specified herein. No oral statements or prior written material not
specifically incorporated herein shall be of any force and effect, and no
changes in or additions to this Agreement shall be recognized unless
incorporated herein by amendment as provided herein, such amendment(s) to become
effective on the date stipulated therein. Employee specifically
acknowledges that in entering into and executing this Agreement, Employee relies
solely upon the representations and agreements contained in this Agreement
and
no others.
REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE
PAGE FOLLOWS
IN
WITNESS WHEREOF, the parties have executed this Agreement as of the
______ day of _______________, 2007.
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COMPANY:
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By
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EMPLOYEE:
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Xxx
Xxxxxxxxx
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