EMPLOYMENT AGREEMENT
This
Employment Agreement (this “Agreement”) is made and entered into as of the 31st
day of March (the “Effective Date”) by and among PLANTATION EXPLORATION, INC., a
Texas corporation (the “Company”), XXXXXX X. XXXXXXXXXXX, an individual (the
“Executive”), and XXXXXX XXXXXX COSMETICS, INC. (“AKPN”), a Nevada corporation,
The Company, Executive and AKPN are collectively referred to herein as the
“Parties.”
WHEREAS,
the Executive is currently serving as sole director and officer of the
Company;
WHEREAS,
AKPN and the Company have entered into (or will soon entered into) a business
combination (the “Business Combination”), whereby the Company will become the
wholly-owned subsidiary of AKPN;
WHEREAS,
the business of the consolidated entities will be that of the Company, which is
the exploration of oil and gas in the United States;
WHEREAS,
Executive has been appointed as a director of AKPN;
WHEREAS,
the Parties desire to enter into this Agreement for Executive to serve as Chief
Executive Officer of both AKPN and the Company;
NOW
THEREFORE, in consideration of the mutual terms and conditions stated herein,
the sufficiency of which is hereby acknowledged, the Company, Executive and AKPN
agree as follows:
1. Employment. The
Company agrees to continue to employ Executive, and Executive agrees to continue
in the employment of the Company, serving as the Company’s Chief Executive
Officer (“CEO”). Additionally, AKPN agrees to hire Executive, and
Executive agrees to accept the position of AKPN’s CEO. In that
position, Executive shall render to the Company and AKPN such administrative and
management services as are customarily performed by persons situated in a
similar executive position, and also perform such other duties and serve in such
other positions as the Company and AKPN reasonably directs from time to
time. Executive shall devote Executive’s full business time
attention, skill, and energy to the business of the Company and AKPN, shall use
Executive’s best efforts to promote the success of the Company’s and AKPN’s
business, and shall cooperate fully in the advancement of the best interests of
the Company and AKPN.
2. Term. This Agreement is for a
two-year period (the “Term”) commencing on the Effective Date hereof and
terminating on the third anniversary of the Effective Date, or upon the date of
termination of employment pursuant to Section 4 of this Agreement; provided,
however, that the Term may be extended as mutually agreed to by the
parties.
3. Compensation and
Benefits
a. Compensation and Benefits
based upon Company Output. Executive shall be entitled to the
following compensation provided that the Company satisfies the following
criteria:
|
(i)
|
If
the Company generates one hundred (100) or more “Barrels of Oil” per day
(as hereinafter defined) within one hundred and eighty (180) days from the
completion of the Business Combination, then AKPN shall issue Executive
seven hundred fifty thousand (750,000) shares of AKPN common
stock. Barrels of Oil is defined and conforms to the standards
of the Petroleum Resources Management System (PRMS), which is prepared by
the Oil and Gas Reserves Committee of the Society of Petroleum Engineers
(SPE); which is in conjunction with the World Petroleum Council, the
American Association of Petroleum Geologists, and the Society of Petroleum
Evaluation Engineers.
|
|
(ii)
|
If,
within three hundred and sixty five (365) days of the Business
Combination, the Company generates three hundred (300) or more Barrels of
Oil per day, then AKPN shall issue Executive an additional seven hundred
fifty thousand (750,000) shares of AKPN common
stock.
|
|
(iii)
|
If,
within three hundred and sixty five (365) days of the Business
Combination, the Company successfully completes a lease with reserves
equal to thirty five million (35,000,000) or more Barrels of Oil, then
AKPN shall issue Executive an additional one million (1,000,000) shares of
AKPN common stock.
|
b. Bonus Compensation based on
Net Operating Cash Flow. Within fifteen (15) days after the
Company’s second and fourth fiscal quarters, the Company shall pay to Executive
a cash bonus equal to three percent (3%) of the net revenues for the just
completed and prior fiscal quarter, and each subsequent second and forth quarter
thereafter.
c. If
AKPN sells all of its assets (“Asset Sale”) while Executive is serving as its
CEO to a third party or other oil and gas company, Executive will receive five
(5%) of the net proceeds paid to AKPN upon closing. If Executive secures an
interested party to an Asset Sale of AKPN, Executive will be compensated an
additional five percent (5%) of the net proceeds paid to AKPN.
d. Stock Options
Compensation. AKPN shall issue the following stock options to
Executive:
|
(i)
|
AKPN
hereby grants to Executive the option to purchase up to one million
(1,000,000) shares of common stock at the exercise price of one dollar and
zero cents ($1.00) per share. This option is exercisable no sooner than
two (2) years from the Effective Date of this Agreement. If Executive’s
employment Agreement is terminated pursuant to Section 4 of this
Agreement, then Executive shall have no option to purchase shares of
common stock in AKPN pursuant to this Section
2(d)(i).
|
2
|
(ii)
|
In
addition, AKPN hereby grants to Executive the option to purchase up to
five percent (5%) of the issued and outstanding shares of common stock in
AKPN that exist at the date of exercise. This option is
exercisable no sooner than two (2) years from the Effective Date of this
Agreement. If Executive’s employment Agreement is terminated pursuant to
Section 4 of this Agreement, then Executive shall have no option to
purchase shares of common stock in AKPN pursuant to this Section
2(d)(ii).
|
e. Monthly
Compensation. The monthly compensation of the Executive shall
be as follows:
|
(i)
|
Compensation for
Months One to Twelve. Subject to Section 2(e)(iii),
Executive shall receive a cash salary of fourteen thousand
dollars ($14,000) per month after the Effective
Date.
|
|
(ii)
|
Compensation for
Months Thirteen to Twenty Four. Subject to Section
2(e)(iii), Executive shall receive a cash salary of twenty
thousand dollars ($20,000) per month after the Effective
Date.
|
|
(iii)
|
Notwithstanding
the provisions of Sections 2(e)(i)-(ii), if AKPN fails to place at least
one million dollars ($1,000,000) of Securities (as hereinafter defined) in
the Private Placement (as hereinafter defined), then Executive shall not
receive the cash salary as described in Sections 2(e)(i)-(ii), but instead
shall receive the value of such salary in the form of shares of common
stock in AKPN. The price per share of common stock that
Executive shall receive shall be the average closing price of a share of
common stock of AKPN for the last ten (10) business days of the calendar
month for which the compensation is being paid. If the Executive is issued
stock pursuant to this Section 2(e)(iii), then AKPN will pay for a legal
opinion at the appropriate time so that Executive’s shares of common stock
are eligible for Rule 144.
|
(f) Success Fee. AKPN
intends to conduct a private placement of up to five million dollars
($5,000,000) of any capital stock (common, preferred, preference or otherwise)
or other equity or ownership interest in AKPN (the “Private Placement”) and any
securities, warrants, options or other rights to acquire any such capital stock
or other equity or ownership interest (the "Securities"). If,
collectively: 1) the Executive, and 2) any Purchaser(s) (“Purchasers” is defined
for this section only as an acquaintance or contact generated by Executive
without any assistance of the Company or AKPN) invested at least one million
Dollars ($1,000,000) worth of Securities in the Private Placement , then AKPN
shall pay to Executive a fee ("Success Fee") in an amount equal to eight and a
half percent (8.5%) of the gross proceeds raised by AKPN for each sale of the
Securities to 1) the Executive or 2) any Purchaser who purchased the Securities
in AKPN as a result of the Purchaser’s relationship with the
Executive. The Success Fee shall, at the option of the Executive, be
payable in (i) cash; (ii) shares of common stock of AKPN in an amount equal to
the Success Fee (the value of common stock of AKPN shall be the average closing
price of common stock of AKPN for the ten (10) business days prior to the
Closing date); or (iii) a combination of cash and shares of the common stock of
AKPN.
3
(g) Compensation for Business
Expenses. Reasonable expenses incurred by Executive to travel
including all airfare, airport transfers, accommodations, and food will be paid
for by AKPN. The executive will need to provide receipts of expenses
and reimburse the company for shortfall or expenses without
receipts. Any travel is subject to pre-approval by
AKPN. Executive will incur normal business expenses in the course of
doing business, which will be pre-approved by the Company and/or AKPN, as the
case may be. A monthly stipend, to be determined by the Company, will
be allotted the Executive. Expenses such as, but not limited to,
taxis to and from appointments, cell phone charges, and parking expenses should
Executive use his personal or rental car to attend appointments. The
Executive will need to provide receipts of expenses and reimburse the company
for shortfall or expenses without receipts.
(h) Annual
Review. Two (2) years from the Effective Date, the Company
shall review Executive’s compensation, and both parties (AKPN and
Executive).
4. Termination of
Employment
(a) Notwithstanding
any provision of this Agreement to the contrary, the employment of Executive
hereunder will terminate on the first to occur of the following
dates:
|
(i)
|
The
date of Executive’s death;
|
|
(ii)
|
The
date on which Executive has experienced a Disability (as defined below),
and the Company gives Executive notice of termination on account of
Disability;
|
|
(iii)
|
The
date on which Executive has engaged in conduct that constitutes Cause (as
defined below), and the Company gives notice of termination for
Cause;
|
|
(iv)
|
Expiration
of the Term;
|
AKPN
(b) For
purposes of this Agreement, “Disability” will mean an illness, injury or other
incapacitating condition as a result of which Executive is unable to perform,
with reasonable accommodation, the services required to be performed under this
Agreement for 20 consecutive days during the Term. Executive agrees
to submit to such medical examinations as may be necessary to determine whether
a Disability exists, pursuant to such reasonable requests made by the Company or
AKPN from time to time. Any determination as to the existence of a
Disability will be made by a physician mutually selected by the Company and
Executive.
(c) For
purposes of this Agreement, “Cause” will mean the occurrence of any of the
following events, as reasonably determined by the Board:
(i) Executive’s
willful refusal to substantially perform his duties hereunder;
4
(ii) Executive’s
conviction of a felony, or his guilty plea to or entry of a nolo contendere plea
to a felony charge; or
(iii) With
respect to Sections 4(d)(i) or (iii) above, such termination for Cause will only
be effective if the conduct constituting Cause is not cured by Executive within
5 days of receipt by Executive of written notice specifying in reasonable detail
the nature of the alleged breach.
5. Termination
Payments
(a) Except
as otherwise expressly provided in this Agreement or required by law, the
Company’s and AKPN’s obligations under this Agreement will automatically
terminate upon the termination of Executive’s employment with the Company and
AKPN and Executive will have no obligation or duty to further serve the Company
or AKPN in any capacity, nor will the Company or AKPN be under any obligation to
make any further payments or provide any further benefits to Executive except as
expressly provided for hereunder or otherwise by applicable law. The
Company and/or AKPN shall remain liable for any payments/debt accrued, but not
yet paid.
(b) Upon
termination of Executive’s employment, Executive will resign all positions of
any kind held with the Company and its affiliates. If the Company
terminated the Executive, the Company will be obligated to provide Executive
only a prorated amount of the salary due him pursuant to Section 3(e) through
the date of termination; and if, upon the date of termination, a performance
condition provided for in Sections 3(a)-(d) and (f) has been satisfied, then the
Executive shall be due the compensation or stock provided for in such particular
section for satisfying the condition; however, if, upon the date of termination,
the Executive has not satisfied a performance condition provided for in Sections
3(a)-(d) and (f), then the Executive shall not receive any compensation 1) for
any unsatisfied condition in Section 3(a)-(d) and (f) and 2) for any performance
condition provided for in Sections 3(a)-(d) and (f) if such condition
should be satisfied after the termination of the Executive’s
employment with the Company. If the Executive terminates his
employment with the Company, then the Executive shall not be entitled to any
compensation otherwise due him under Section 3 of this Agreement.
6. Miscellaneous
a. Successors and
Assigns. This Agreement will be binding upon and inure to the
benefit of (i) the Company and AKPN and its successors and assigns and (ii)
Executive and Executive’s heirs and personal representatives. This
Agreement is not assignable by Executive.
b. Stock
Matters. Executive may transfer shares of common stock of AKPN
received as part of this Agreement or any other Agreement, furnished by AKPN, to
any third party. Both Parties agree that the common stock issued to
Executive will be restricted shares, subject to SEC Rule 144 for one (1) year,
effective upon issuance by AKPN or Company. Upon the satisfaction of
any of the terms or conditions contained in this Agreement whereby Executive
becomes entitled to receive shares of AKPN, Company and/or AKPN shall duly issue
said shares to Executive within fourteen (14) business days.
5
c. Notices. All
notices, requests, demands and other communications hereunder will be in writing
and will be deemed to have been duly given if delivered via telecopy, overnight
delivery, or prepaid certified or registered U.S. Mail, return receipt
requested, to the following addresses or to such other address as either Party
any designate by like notice:
If to
AKPN, to: Xxxxxx Xxxxxx Cosmetics, Inc., c/o Xxxxxx Xxxxxx, 0000 Xxxx Xxxx
Xxxxxxx, Xxx Xxxxx, XX 00000
If to the
Company, to: Plantation Exploration, Inc, c/o Xxxxxx X. Xxxxxxxxxxx, 00000
Xxxxxxxxxx, Xxxxx 000, Xxxxxxx, XX 00000
d. Entire Agreement;
Modification. This Agreement contains the entire agreement of
the Parties about the subjects in it, and it replaces all prior contemporaneous
oral or written agreements, understandings, statements, representations and
promises by either Party. No supplement, modification, or amendment
to this Agreement will be effective and binding unless the same is contained in
writing accepted and duly executed by the Parties.
e. Paragraph
Headings. The paragraph headings used in this Agreement are
included solely for convenience and will not affect, or be used in connection
with, the interpretation of this Agreement.
f. Severability. The
provisions of this Agreement will be deemed severable and the invalidity or
unenforceability of any provision will not affect the validity or enforceability
of the other provisions hereof.
g. Governing
Law. This Agreement will, except to the extent that federal
law will be deemed to apply, be governed by and construed and enforced in
accordance with the laws of Nevada.
[Signature
Page Follows]
6
IN WITNESS WHEREOF, the Parties
have entered into this Agreement as of the date first hereinabove
written.
| Xxxxxx Xxxxxx Cosmetics, Inc. | |
| By: |
/s/ Xxxxxx Xxxxxx
|
| Name: |
Xxxxxx Xxxxxx
|
| Title: |
CEO
|
| PLANTATION EXPLORATIONS, INC. | |
| By: |
/s/
Xxxxxx X.
Xxxxxxxxxxx
|
| Name: |
Xxxxxx X. Xxxxxxxxxxx
|
| Title: |
CEO
|
