EMPLOYMENT AGREEMENT
EXHIBIT
10.2
THIS
EMPLOYMENT AGREEMENT (this “Agreement”), is made on October 3,
2007, by and between PetroHunter Operating Company, a
Maryland corporation (the “Employer”), and Xxxx Xxxxxxxx, an individual
residing in Parker, Colorado (the “Employee”).
The
parties, intending to be legally bound, agree as follows:
1.
DEFINITIONS
For
the
purposes of this Agreement, the following terms have the meanings specified
or
referred to in this Section 1.
“Agreement”
means this Employment Agreement, as amended, restated or otherwise modified
from
time to time.
“Benefits”
is defined in Section 3.3.
“Board”
means the Board of Directors of the Employer.
“Confidential
Information” means any and all:
(a) trade
secrets concerning the business and affairs of the Employer, whether a
technical, business or other nature that is disclosed to the Employee or that
is
otherwise learned by Employee in the course of employment with the Company,
including but not limited to know-how, processes, designs, samples, inventions
and ideas, past, current, and planned property or mineral acquisition, and
all
information related thereto, exploration or development activities or methods,
customer and vendor lists, business plans as well as any other information,
however documented, that is a trade secret within the meaning of the Colorado
Trade Secrets Act, as in effect as of the date hereof and as amended from time
to time; and
(b) information
concerning the business and affairs of the Employer (which includes historical
financial statements, financial projections and budgets, historical and
projected sales, capital spending budgets and plans, however
documented).
(c) "Confidential
Information" shall not include information, data, knowledge and know-how that
(a) is in the Employee’s possession prior to disclosure to the recipient
party, (b) is in the public domain prior to disclosure to the Employee,
(c) lawfully enters the public domain through no violation of this
Agreement after disclosure to the Employee, (d) becomes available to the
Employee on a non-confidential basis from a source other than the Employer,
provided that such source is not known by the Employee to be bound by a
confidentiality agreement with the Employer or another party,
“Effective
Date” means the date first written above.
“Employee
Invention” means any idea, invention, or improvement (whether patentable or
not), any industrial design (whether registrable or not), and any work of
authorship (whether or not copyright protection may be obtained for it) created,
conceived, or developed by the Employee, either solely or in conjunction with
others, during the Employment Period, or a period that includes a portion of
the
Employment Period, that relates to the business then being conducted or proposed
to be conducted by the Employer.
“Employment
Period” means the period of the Employee’s employment under this
Agreement.
“Person”
means any individual, corporation (including any non-profit corporation),
general or limited partnership, limited liability company, joint venture,
estate, trust, association, organization, or governmental body.
“For
Cause” means: (a) the Employee’s material breach of this Agreement; (b) the
Employee’s material failure to adhere to any written Employer policy; (c) the
appropriation (or attempted appropriation) of a material business opportunity
of
the Employer, including attempting to secure or securing any personal profit
in
connection with any transaction entered into on behalf of the Employer; (d)
the
misappropriation (or attempted misappropriation) of any of the Employer’s funds
or property; or (e) the conviction of, or the entering of a guilty plea or
plea
of no contest with respect to, a felony.
“Salary”
is defined in Section 3.1.
2.
EMPLOYMENT
TERMS AND DUTIES
2.1 Employment.
The Employer hereby employs the Employee, and the Employee hereby accepts
employment by the Employer, upon the terms and conditions set forth in this
Agreement.
2.2 Term.
The Employer hereby employs the Employee effective as of the Effective Date,
however for purposes of computing severance pursuant to Section 2.3, below,
the
Employee’s date of hire shall be October 15, 2007. The employment
with the Employer is not for any specified period of time. As a
result, either the Employer or the Employee is free to terminate the employment
relationship at any time, subject to the other provisions of this
Agreement. Unless earlier terminated, this Agreement will terminate
on December 31, 2012.
2.3 Termination.
If the Employee is terminated by the Employer for any reason, other than For
Cause, he will receive Salary and Benefits as severance in an amount equal
to
six months of Salary. No severance payments will be made until
Employee executes a valid release of any and all claims that he may have
relating to his employment against the Employer and its agents in a form
provided by the Employer. If the Employee is terminated For Cause, or
resigns, his Salary and Benefits will terminate immediately upon leaving the
Employer. The Employer may terminate Employee For Cause only after
(a) Employee has had the opportunity to discuss such termination with the Board
of Directors or the Chairman of the Board of the Employer, (b) the Board of
Directors of the Employer has adopted a resolution terminating Employee’s
employment
and
specifying, in reasonable detail, the “For Cause” termination, and (c) the
Employee shall have received written notice of such action, which notice shall
include a copy of the resolution specifying the “For Cause”
termination. If a matter purported giving rise to a “For Cause”
termination could be cured by Employee, the Board of Directors shall not take
any action to terminate the Employee hereunder unless and until the Employee
has
received written notice from the Chairman or by or on behalf of the Board of
Directors of the Employer specifying such cause and Employee shall have failed
to cure or correct such cause within 30 days after receiving such
notice.
2.4 Duties.
The Employee will have such duties as are assigned or delegated to the Employee
by the Board. The Employee will devote substantially all of his business time,
attention, skill, and energy to the business of the Employer, will use his
best
efforts to promote the success of the Employer’s business, and will cooperate
fully with the Board in the advancement of the best interests of the
Employer. Employee will not compete with the Employer during the
Employment Period. Nothing in this Section 2.4, however, will
prevent the Employee from engaging in additional activities in connection with
personal investments and community affairs that are not inconsistent with the
Employee’s duties under this Agreement. At the Employer’s request,
Employee may also perform services for companies that have a business
relationship with the Employer. Unless agreed to by the Employer,
Employee will receive no additional Salary or Benefits or other compensation
for
these services.
3.
COMPENSATION
3.1 Salary.
The Employee will be paid an annual salary of $170,000, (the “Salary”),
which will be payable in equal periodic installments according to the Employer’s
customary payroll practices, but no less frequently than
monthly. During the term of this Agreement, the salary may be
increased by the Board.
3.2 Bonus.
The Board of Directors of Employer shall adopt a bonus plan for executive
officers of the Company within 120 days of the date of this Agreement and
the Employee shall be eligible to participate in such plan. The
Employee shall, subject to meeting the criteria for bonus compensation set
forth
in the plan, be eligible to receive a bonus of up to [100%] of Employees’ annual
salary. The Employee acknowledges that all determinations of the
Board shall be final.
3.3 Benefits.
The Employee will, during the Employment Period, be permitted to participate
in
such pension, profit sharing, bonus, life insurance, hospitalization, major
medical, and other employee benefit plans of the Employer that may be in effect
from time to time, to the extent the Employee is eligible under the terms of
those plans (collectively, the “Benefits”).
3.4 Stock
Options. The Employee will receive stock option grants totaling
600,000 stock options as follows: 500,000 stock options to be priced
at the closing price of market as quoted on the OTC:BB on the date of hire,
plus
an additional 100,000 stock options to be recommended for approval by the Board
of Directors of Employer at the next regularly scheduled meeting to be priced
at
the closing price of market as quoted on the OTC:BB on the date of
grant. The next regular Board of Directors meeting is scheduled for
December 7, 2007.
3.4.1 Change
of Control . All grants made under the stock option or other equity
incentive plans of Employer (the “Equity Plans”) (including those
made prior to the effective date of this Agreement) shall vest in full
immediately prior to the occurrence of a Change of Control. For purposes
of this Agreement, a Change of Control shall mean the first to occur
of:
(B)
consummation of a reorganization, merger or consolidation of the Employer (a
“
Business Combination ”), in each case, unless, following such Business
Combination, the individuals and entities who were the beneficial owners of
outstanding voting securities of the Employer immediately prior to such Business
Combination beneficially own, by reason of such ownership of the Employer’s
voting securities immediately before the Business Combination, directly or
indirectly, more than 50 % of the combined voting power of the then outstanding
voting securities entitled to vote generally in the election of directors of
the
Employer resulting from such Business Combination (including, without
limitation, a company which as a result of such transaction owns the Employer
or
all or substantially all of the Employer’s assets either directly or through one
or more subsidiaries) in substantially the same proportions as their ownership
of the outstanding voting securities of the Employer immediately prior to such
Business Combination; or
(C)
approval by the stockholders of the Employer of a complete liquidation or
dissolution of the Employer.
To
the
extent that the terms of this Agreement conflict with the terms of the Equity
Plans of the Employer, the terms of this Agreement shall control and the
Employer agrees that the provisions set forth herein regarding Change in Control
shall be included in any stock option agreement or similar granting instrument
entered into with or provided to Employee in connection with Employee’s
employment with Employer.
4.
VACATIONS, HOLIDAYS AND SICK LEAVE
The
Employee will accrue 6.67 hours of vacation time for each pay period for a
total
of 160 hours of annual vacation time, will be entitled to 5 sick days/personal
days annually and will be entitled to paid holidays in accordance with the
policies of the Employer.
5. NON-DISCLOSURE
COVENANT; EMPLOYEE INVENTIONS
5.1 Acknowledgments
by the Employee. The Employee acknowledges that (a) during the
Employment Period and as a part of his employment, the Employee will be afforded
access to Confidential Information; (b) public disclosure of such Confidential
Information could have an adverse effect on the Employer and its business;
(c)
because the Employee possesses substantial technical expertise and skill with
respect to the Employer’s business, the Employer desires to obtain exclusive
ownership of each Employee Invention, and the Employer will be at a substantial
competitive disadvantage if it fails to acquire exclusive ownership of each
Employee Invention; and (d) the provisions of this Section 5 are
reasonable and necessary to prevent the improper use or disclosure of
Confidential Information and to provide the Employer with exclusive ownership
of
all Employee Inventions.
5.2 Agreements
of the Employee. In consideration of the compensation and benefits to be
paid or provided to the Employee by the Employer under this Agreement, the
Employee covenants as follows:
(a) Confidentiality.
(i) During
and following the Employment Period, the Employee will hold in confidence the
Confidential Information and will not disclose it to any Person except with
the
specific prior written consent of the Employer or except as otherwise expressly
permitted by the terms of this Agreement.
(ii) Any
trade
secrets of the Employer will be entitled to all of the protections and benefits
under the Colorado Trade Secrets Act, as in effect on the date hereof, and
as
amended from time to time, and any other applicable law.
(iii) None
of
the foregoing obligations and restrictions applies to any part of the
Confidential Information that the Employee demonstrates was or became generally
available to the public other than as a result of a disclosure by the
Employee.
(b) Employee
Inventions. During the Employment Period, each Employee Invention will
belong exclusively to the Employer. The Employee acknowledges that the
Employee’s writing, works of authorship, and other Employee Inventions are works
made for hire and the property of the Employer, including any copyrights,
patents, or other intellectual property rights pertaining thereto. The Employee
covenants that he will promptly:
(i) disclose
to the Employer in writing any Employee Invention;
(ii) assign
to
the Employer or to a party designated by the Employer, at the Employer’s request
and without additional compensation, all of the Employee’s right to the Employee
Invention for the United States and all foreign jurisdictions;
(iii) execute
and deliver to the Employer such applications, assignments, and other documents
as the Employer may request in order to apply for and obtain patents or other
registrations with respect to any Employee Invention in the United States and
any foreign jurisdictions;
(iv) sign
all
other papers necessary to carry out the above obligations; and
(v) give
testimony and render any other assistance, without expense to the Employee,
in
support of the Employer’s rights to any Employee Invention.
6. EXCLUSIVE
EMPLOYMENT
Subject
to the provisions of Section 2.4, above, during the Employment Period, (a)
Employee will not do anything to compete with the Employer’s present or
contemplated business (as that may change from time to time during the
Employment Period), nor will he plan or organize any competitive business
activity; and (b) Employee will not enter into any agreement which conflicts
with his duties or obligations to the Employer. Employee will not
during the Employment Period or within six months after it ends, without the
Employer’s express written consent, solicit or encourage any employee, agent,
independent contractor, supplier, consultant, investor or alliance partner
to
terminate or alter a relationship with the Employer.
It
is the
desire and intent of the Employer and the Employee that the provisions of this
Section 6 be enforced to the fullest extent permissible under the laws and
public policies applied in each jurisdiction in which enforcement is
sought. Accordingly, if any particular portion of this Section 6
shall be adjudicated to be invalid or unenforceable, this Section 6 shall be
deemed amended to apply in the broadest allowable manner and to delete therefrom
the portion adjudicated to be invalid or unenforceable, such amendment and
deletion to apply only with respect to the operation of Section 6 in the
particular jurisdiction in which that adjudication is made.
7. GENERAL
PROVISIONS
7.1 Covenants
of Sections 5 and 6 Are Essential and Independent Covenants. The
covenants by the Employee in Sections 5 and 6 are essential elements
of this Agreement, and without the Employee’s agreement to comply with such
covenants, the Employer would not have entered into this Agreement or employed
or continued the employment of the Employee. The Employer and the Employee
have
independently consulted their respective counsel and have been advised in all
respects concerning the reasonableness and propriety of such covenants, with
specific regard to the nature of the business conducted by the
Employer.
The
Employee’s covenants in Sections 5 and 6 are independent covenants
and the existence of any claim by the Employee against the Employer under this
Agreement or otherwise, will not excuse the Employee’s breach of any covenant in
Sections 5 and 6.
If
the
Employee’s employment hereunder expires or is terminated, this Agreement will
continue in full force and effect as is necessary or appropriate to enforce
the
covenants and agreements of the Employee in Sections 5 and 6, and the
Employer will have the right in addition to any other rights it may have, to
seek injunctive relief to restrain or specifically enforce provisions of this
Agreement.
7.2 Representations
and Warranties by the Employee. The Employee represents and warrants to the
Employer that the execution and delivery by the Employee of this Agreement
do
not, and the performance by the Employee of the Employee’s obligations hereunder
will not, with or without the giving of notice or the passage of time, or both:
(a) violate any judgment, writ, injunction, or order of any court, arbitrator,
or governmental agency applicable to the Employee; or (b) conflict with, result
in the breach of any provisions of or the termination of, or constitute a
default under, any agreement to which the Employee is a party or by which the
Employee is or may be bound.
7.3 Waiver.
The rights and remedies of the parties to this Agreement are cumulative and
not
alternative. Neither the failure nor any delay by either party in
exercising any right, power, or privilege under this Agreement will operate
as a
waiver of such right, power, or privilege, and no single or partial exercise
of
any such right, power, or privilege will preclude any other or further exercise
of such right, power, or privilege or the exercise of any other right, power,
or
privilege. To the maximum extent permitted by applicable law, (a) no claim
or
right arising out of this Agreement can be discharged by one party, in whole
or
in part, by a waiver or renunciation of the claim or right unless in writing
signed by the other party; (b) no waiver that may be given by a party will
be
applicable except in the specific instance for which it is given; and (c) no
notice to or demand on one party will be deemed to be a waiver of any obligation
of such party or of the right of the party giving such notice or demand to
take
further action without notice or demand as provided in this
Agreement.
7.4 Binding
Effect; Delegation of Duties Prohibited. This Agreement shall inure to the
benefit of, and shall be binding upon, the parties hereto and their respective
successors, assigns, heirs, and legal representatives, including any entity
with
which the Employer may merge or consolidate or to which all or substantially
all
of its assets may be transferred. The duties and covenants of the
Employee under this Agreement, being personal, may not be
delegated.
7.5 Notices.
All notices, consents, waivers, and other communications under this Agreement
must be in writing and will be deemed to have been duly given when (a) delivered
by hand (with written confirmation of receipt), (b) sent by facsimile (with
written confirmation of receipt), provided that a copy is mailed by registered
mail, return receipt requested, or (c) when received by the addressee, if sent
by a nationally recognized overnight delivery service (receipt requested),
in
each case to the appropriate addresses and facsimile numbers set forth below
(or
to such other
Employment
Agreement
Xxxx
Xxxxxxx
7
addresses
and facsimile numbers as a party may designate by notice to the other
parties):
|
If
to Employer:
|
PetroHunter
Operating Company
|
|
|
0000
Xxxxxxxx Xxxxxx, Xxxxx 0000
|
|
|
Xxxxxx,
XX 00000
|
|
|
Fax:
(000) 000-0000
|
|
If
to the Employee:
|
As
set forth on signature page.
|
7.6 Entire
Agreement; Amendments. This Agreement contains the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
agreements and understandings, oral or written, between the parties hereto
with
respect to the subject matter hereof. This Agreement may not be
amended orally, but only by an agreement in writing signed by the parties
hereto.
7.7 Governing
Law; Forum and Venue. This Agreement shall be construed according
to the law of the State of Colorado and any actions to enforce the terms of
this
Agreement shall be exclusively brought in either state or federal court in
the
City and County of Denver, Colorado, and each of the parties consents to the
jurisdiction of such courts (and of the appropriate appellate courts) in any
such action or proceeding and waives any objection to venue laid
therein. Process in any action or proceeding referred to in the
preceding sentence may be served on either party anywhere in the
world. The prevailing Party in any such action shall be entitled to
recover its attorney’s fees and all costs of any such action.
7.8 Severability.
If any provision of this Agreement is held invalid or unenforceable by any
court
of competent jurisdiction, the other provisions of this Agreement will remain
in
full force and effect. Any provision of this Agreement held invalid
or unenforceable only in part or degree will remain in full force and effect
to
the extent not held invalid or unenforceable.
7.9 Counterparts
and Facsimile. This Agreement may be executed in one or more counterparts,
each of which will be deemed to be an original copy of this Agreement and all
of
which, when taken together, will be deemed to constitute one and the same
agreement. Facsimile signatures shall be considered an original
signature.
7.10 Waiver
of Jury Trial. THE PARTIES HERETO HEREBY WAIVE A JURY TRIAL IN
ANY LITIGATION WITH RESPECT TO THIS AGREEMENT.
8
IN
WITNESS WHEREOF, the parties have executed and delivered this Agreement as
of
the date first written above.
| EMPLOYER: | |||
| PETROHUNTER OPERATING COMPANY | |||
|
|
By:
|
/s/ Xxxx X. XxxxxXxxxxxx | |
| Name: | Xxxx X. XxxxxXxxxxxx | ||
| Title: | Vice President of Administration | ||
| EMPLOYEE: | |||
|
|
By:
|
/s/ Xxxx Xxxxxxxx | |
| Name: | Xxxx Xxxxxxxx | ||
| Address: | 00000 X. 0xx Xxxxxx | ||
| Xxxxxx, XX 00000 | |||
| Facsimile Number: | |||
Employment
Agreement
Xxxx
Xxxxxxx
9
