CONSULTING AGREEMENT
Exhibit 10.18
THIS
CONSULTING AGREEMENT (this “Agreement”), effective March
2, 2010 (the “Effective Date”), is made between KL Energy Corp., a Nevada
corporation (the “Company"), having its
principal place of business at 000 Xxxx Xxxxx Xxxxxx Xxxxxx Xxxxx 000 Xxxxx
Xxxx, Xxxxx Xxxxxx 00000, and Xxxxx Xxxxxxxx ("Consultant"), of 0000 Xxxxx
Xxxxx, Xxxxx Xxxx XX 00000.
In
consideration of the Company retaining Consultant to provide consulting services
for the Company, the parties agree as follows:
1. General
Understanding
Consultant
hereby agrees to provide the services (the “Services”) as requested from
time to time by the Board of Directors of the Company (the “Board”). The Board
shall authorize the specific projects and the related tasks to be performed by
Consultant under this Agreement. Consultant will perform the Services at (a) the
Consultant’s principal place of business. The Consultant will provide office
space, furniture, computer equipment, supplies, and other equipment necessary to
perform the Services as directed. Consultant will perform the
Services under the general direction of the Board.
2. Term
This
Agreement shall commence on the Effective Date and shall remain in effect until
terminated unless earlier terminated pursuant to this Section 2 (the “Term”). The Company
may terminate this Agreement at any time after the fourth month by providing
written notice to Consultant and specifying the effective date of termination in
such notice (which date must be on or after the date such notice is provided to
Consultant), and the Consultant may terminate this Agreement at any time upon
ten (10) days written notice to the Company. If the Company
terminates Services hereunder for any reason other than Consultant’s material
breach of this Agreement, the Company shall pay Consultant all amounts due and
unpaid for Services performed on or prior to termination.
3. Compensation
a)
Compensation for the first four months of this Agreement shall be $12,251.58 per
month, for a total of $49,006.33. Beginning in month five, Consultant will be
compensated for the Services performed under this Agreement at the rate of
$3,000 per month plus dental coverage at the current plan. The rate
stated includes all taxes. Consultant shall be reimbursed for reasonable
business expenses directly related to the Services under this Agreement.If the
Consultant provides Services at the Company’s request and approval in any
particular month in excess of 30 hours, the Consultant will be paid $100 per
hour for each approved hour in excess of the 30 hours in that month. b) Within
30 days of the Execution date the Company will grant to the Consultant a fully
vested option to acquire 83,333 share of the Company's common stock at a
exercise price of $1.10 per share for an exercise period of 3
years.
4. Lock-Up
Shares
On the execution of this
Agreement by the parties hereto, Employer agrees to release or cause the release
of the 594,046 shares of Employer’s common stock held by Employee that are
subject to that certain lock-up agreement dated September 30, 2008 from the
contractual restrictions and covenants set forth in the Lock-Up.
5. Indemnity
of Employee
Employer
agrees to indemnify Employee to the same extent that Employer is indemnifying
its directors and officers as provided in Employer’s Articles of Incorporation
and Bylaws in connection with any action or proceeding in which Employee was
named a party by reason of the fact that Employee was serving as the Chief
Executive Officer of Employer for his acts or omissions during the period when
Employee was serving as the Chief Executive Officer of Employer until March 2,
2010, provided that Employee acted in good faith and in a manner Employee
reasonably believed to be in the best interests of Employer, and, with respect
to any criminal action or proceeding, had no reasonable cause to believe
Employee’s conduct was unlawful.
Exhibit
10.18 Page 1
6. Confidential
Information, Work Product and Assignment of Inventions.
Confidential
Information. Consultant shall continue to be
bound by the terms of the Employee Proprietary Information Inventions
Agreement (attached as Exhibit A) and the Noncompetition Agreement (attached as
Exhibt B) (collectively, the "IP Agreements") signed by Employee as part of
Employee’s Employment Agreement effective February 15, 2010, for the term of
this Agreeement, with all references to "Employment Agreement," "Employee or
Executive" or "Employment" in the IP Agreements referring to this
Agreement, the Consultant and the engagement under this Agreement, respectively.
Consultant shall use the Confidential Information of the Company only
during the term of this Agreement, and as expressly permitted herein, and shall
disclose such Confidential Information only to employees, agents and
representatives of the Company as is reasonably required in connection with the
exercise of the rights and obligations under this Agreement (and only subject to
binding use and disclosure restrictions at least as protective as those set
forth herein executed in writing by such employees, agents and
representatives).
Consultant
shall maintain the Confidential Information of the Company in strict confidence
during the term of this Agreement and after its termination, and shall exercise
no less than reasonable care with respect to the handling and protection of such
Confidential Information. Consultant shall use the Confidential
Information of the Company only during the term of this Agreement and as
expressly permitted herein, and shall disclose such Confidential Information
only to employees, agents and representatives of the Company as is reasonably
required in connection with the exercise of the rights and obligations under
this Agreement (and only subject to binding use and disclosure restrictions at
least as protective as those set forth herein executed in writing by such
employees, agents and representatives). “Confidential Information”
means all communication or data information disclosed by the Company, including,
but not limited to any information relating to the Company’s business affairs,
including trade secrets, research and development data, know-how, market studies
and forecasts, marketing materials and plans, competitive analyses, pricing
policies, employee lists, employment and consulting agreements, personnel
policies, the substance of agreements with customers, suppliers, vendors and
others, marketing arrangements, customer lists, commercial arrangements,
financial and accounting information, trade secrets, inventions, samples,
formulae, source and object code, concepts, ideas, know-how, processes,
techniques, process additives, other works of authorship, technology, features,
improvements, discoveries, developments, designs, and enhancements, business
information, business plans, technical or financial information, research and
development plans, budgets, financial information, customer lists or proposals,
sketches, models, samples, computer programs and documentation, drawings,
specifications, data, databases, price lists, costs, supplier information, Third
Party Information (as described below), and information marked or labeled as
“confidential” or “proprietary” disclosed by the Company, whether
conveyed in oral, written, graphic, or electronic form or otherwise. “Third Party Information” is
confidential or proprietary information received from a third party and that is
subject to a duty on the Company’s part to maintain the confidentiality of such
information and to use it only for certain limited purposes
Confidential
Information excludes information that:
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(a)
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is
in or enters the public domain, through no fault of Consultant;
or
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(b)
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has
been disclosed by the disclosing party to a third party without
restriction; or
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(c)
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is
known to the general public through publication or otherwise;
or
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(d)
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is
already known to the receiving party at the time of its disclosure;
or
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(e)
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is
independently developed by Consultant without use of or reference to the
Company’s Confidential Information.
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Notwithstanding
the foregoing, all information that relates to the Work Product or Inventions
(each as defined below) or that is developed in connection with the Work Product
or Inventions under this Agreement, regardless of whether such is identified as
being confidential or proprietary or falls under or on the exceptions set forth
above, shall be deemed to be the Confidential Information of the Company and
shall be subject to the restrictions set forth in this Section 4.
Consultant
acknowledges the confidential and proprietary nature of the Company’s
Confidential Information and agrees, except as expressly authorized or permitted
under this Agreement, (i) to hold the Company’s Confidential Information in
confidence and to take all reasonable precautions to protect such
Exhibit
10.18 Page 2
Confidential
Information (including, without limitation, all precautions the Consultant
employs with respect to its own confidential materials), (ii) not to divulge any
such Confidential Information to any third person, and (iii) not to make any use
whatsoever of such Confidential Information.
b. Work
Product. The product of all work performed on behalf of the
Company by Consultant pursuant to this Agreement in connection with the Services
(including work performed prior to the Effective Date, whether or not pursuant
to a written agreement), including, without limitation, any Services relating to
the Company’s business affairs, human resources, finance and accounting, legal
matters, technology and other departments, and including all related proprietary
technology, trade secrets, research and development data, know-how, market
studies and forecasts, competitive analyses, pricing policies, employee lists,
employment and consulting agreements, personnel policies, the substance of
agreements with customers, suppliers, vendors and others, marketing
arrangements, customer lists, commercial arrangements, financial and accounting
information, and any other work product and information relating to the Company,
whether or not publicly available (the “Work Product”) shall be owned
by the Company.
Consultant
acknowledges that the copyright to all original works of authorship which are or
have been made by him, her or it (solely or jointly with others) within the
scope of Consultant’s Services (including any services performed by the
Consultant for the Company prior to the date of this Agreement), and which are
classifiable as “works made for hire,” as defined by the United States Copyright
Act (17 U.S.C., Section 101), shall be owned by the Company, and
alternatively, Consultant hereby irrevocably assigns all right, title and
interest that Consultant may have in and to the Work Product to the
Company.
Consultant
warrants that, to the best of Consultant’s knowledge, the Work Product will not
violate any proprietary rights (including patent rights, copyright rights, trade
secret rights, trademark rights, and all other intellectual property rights of
any sort throughout the world, collectively, “Proprietary Rights”) of any
third party. The Company warrants that materials provided by the
Company for a Project will not violate any proprietary rights of any third
party.
At
termination of this Agreement, Consultant shall deliver to the Company both the
completed and any uncompleted portions of the Work Product, without
exception. The Company, as owner of all Work Product, may change,
alter, and revise the Work Product as necessary.
c. Assignment of
Inventions. Consultant hereby assigns and agrees to assign in
the future (when any such Inventions, as defined below, or Proprietary Rights
are first reduced to practice or first fixed in a tangible medium, as
applicable) to the Company all of Consultant’s right, title and interest in and
to any and all Inventions (and all Proprietary Rights with respect thereto),
trade secrets, Confidential Information, software programs, discoveries,
conceptions, preparations and developments, whether or not eligible for or
covered by patent, copyright or trade secret protection, and whether or not such
constitute works made for hire or would otherwise belong to the Company by
operation of law (all collectively hereinafter referred to as “Inventions”) that become known
to, or are made, conceived, reduced to practice or learned by Consultant, either
alone or jointly with others, during the period of Consultant’s services for the
Company or any predecessor company, including any Inventions developed prior to
the date of this Agreement. Inventions assigned to the Company are
hereinafter referred to as “Company
Inventions”.
d. Enforcement of Proprietary
Rights. Consultant agrees
to assist the Company in every proper way to obtain, and from time to time
enforce, United States and foreign Proprietary Rights relating to Company
Inventions in any and all countries. To that end Consultant will
execute, verify and deliver such documents and perform such other acts
(including appearances as a witness) as the Company may reasonably request for
use in applying for, obtaining, perfecting, evidencing, sustaining and enforcing
such Proprietary Rights and the assignment thereof. In addition,
Consultant agrees to execute, verify and deliver assignments of such Proprietary
Rights to the Company or its designee. Consultant’s obligation to
assist the Company with respect to Proprietary Rights relating to such Company
Inventions in any and all countries shall continue beyond the termination of
Consultant’s employment, but the Company shall compensate Consultant at a
reasonable rate after termination of this Agreement for the time actually spent
by Consultant at the Company’s request on such assistance.
Exhibit
10.18 Page 3
In the
event the Company is unable for any reason, after reasonable effort, to secure
Consultant’s signature on any document needed in connection with the actions
specified in the preceding paragraph, Consultant hereby irrevocably designates
and appoints the Company and its duly authorized officers and agents as
Consultant’s agent and attorney-in-fact, which appointment is coupled with an
interest, to act for and in Consultant’s behalf to execute, verify and file any
such documents and to do all other lawfully permitted acts to further the
purposes of the preceding paragraph with the same legal force and effect as if
executed by Consultant. Consultant hereby waives and quitclaims to
the Company any and all claims, of any nature whatsoever, which Consultant now
or may hereafter have for infringement of any Proprietary Rights assigned
hereunder to the Company.
If any
part of the Services or Inventions is based on, incorporates, or is an
improvement or derivative of, or cannot be reasonably and fully made, used,
reproduced, modified, distributed or otherwise exploited without using or
violating any technology or Proprietary Right owned by Consultant and not
assigned hereunder (“Restricted
Rights”), then Consultant hereby grants and agrees to grant to the
Company and its affiliates, successors and assignees a non-exclusive, perpetual,
irrevocable, worldwide, royalty-free, sublicenseable right and license to
exploit and exercise all such Restricted Rights in support of Company’s exercise
or exploitation of the Services, Inventions or other work performed hereunder
(including any modifications, improvements and
derivatives). Consultant agrees not to use or disclose any Restricted
Rights for which it is not fully authorized to grant the foregoing
license.
7. Warranties
by Consultant
Consultant
represents and warrants to the Company that Consultant has the experience and
ability to perform the Services required by this Agreement; that Consultant will perform said
Services in a professional, competent and timely manner; that Consultant has the power to enter
into and perform this Agreement; and that Consultant’s performance of this
Agreement shall not infringe upon or violate the rights of any third party or
violate any applicable federal, state or local laws.
Since
Consultant began performing services for the Company, Consultant has not and, in
the future, will not improperly use or disclose any confidential information or
trade secrets, if any, of any former employer or any other person to whom he has
an obligation of confidentiality, and Consultant has not and will not bring onto
the premises of the Company any unpublished documents or any property belonging
to any former employer or any other person to whom Consultant has an obligation
of confidentiality unless consented to in writing by that former employer or
person. Consultant will use in the performance of his duties only
information which is generally known and used by persons with training and
experience comparable to his own, which is common knowledge in the industry or
otherwise legally in the public domain, or which is otherwise provided or
developed by the Company
8. Independent
Consultant
Consultant
acknowledges that the Services rendered under this Agreement shall be solely as
an independent consultant. Consultant shall not enter into any
contract or commitment on behalf of the Company. Consultant further
acknowledges that Consultant is not considered an
affiliate or subsidiary of the Company, and is not entitled to any of the
Company employment rights or benefits. Nothing herein shall be deemed
to establish a partnership, joint venture, association or employment
relationship between the parties. Each party shall remain
responsible, and shall indemnify and hold harmless the other party, for the
withholding and payment of all federal, state and local personal income, wage,
earnings, occupation, social security, unemployment, sickness and disability
insurance taxes, payroll levies or employee benefit requirements (under ERISA,
state law or otherwise) now existing or hereafter enacted and attributable to
themselves and their respective people.
9. Default
Either
party may be declared in default of this Agreement if (a) the other party
breaches any material provision hereof and fails within 10 days after receipt of
notice of default to correct such default or to commence corrective action
reasonably acceptable to the non-breaching party and proceed with due diligence
to completion; or (b) the other party (i) becomes insolvent,
(ii) makes an assignment for the benefit of its creditors, (iii) a
receiver is appointed or a petition in bankruptcy is filed with respect to the
party and is not dismissed within 30 days, or (iv) ceases its business
operations.
Exhibit
10.18 Page 4
10. Disputes,
Governing Law
The
parties agree that in the event of any disputes between them, the parties shall
first try, for a period of 30 days from the initial Notice of the dispute is
given by one party to the other, to informally resolve the
dispute. Any disputes that cannot be resolved informally within such
30 day period may be submitted by either party to a single neutral
arbitrator. The proceedings shall be conducted in accordance with the
Commercial Arbitration Rules of the American Arbitration Association. The award
of the arbitrators shall include a written explanation of their
decision. The arbitration shall be held in South Dakota at a location
determined by the Company.
This
Agreement shall be construed and enforced in accordance with the laws of the
State of Nevada.
11. Notices
Notices
sent to either party shall be effective when delivered in writing (“Notice”) in person or
transmitted by fax (with confirmation of receipt), one day after being sent by
overnight courier, or three days after being sent by first class mail postage
prepaid to the addresses set forth below, or at such other address as the
parties may provide from time to time:
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Consultant
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The Company
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Xxxxx
Xxxxxxxx
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0000
Xxxxx Xxxxx
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000
Xxxx Xxxxx Xxxxxx Xxxxxx, Xxxxx 000
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Xxxxx
Xxxx XX, 00000
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Xxxxx
Xxxx, Xxxxx Xxxxxx 00000
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Attn: Xxxxxx Xxxxxxxxx
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Email
: xxxxxxxxxx@xxx.xxx
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Email:XXxxxxxxxx@XXXxxxxxXxxx.xxx
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An email
of this Agreement (as well as a photocopy thereof) shall be treated as
"original" documents admissible into evidence unless a document's authenticity
is genuinely placed in question.
12. Miscellaneous
This
Agreement and its exhibits constitute the entire agreement between the parties
with respect to the subject matter hereof and this Agreement supersedes all
other communications, whether written or oral. This Agreement may be
modified or amended only by mutual, written agreement. Except as
specifically permitted herein, neither this Agreement nor any rights or
obligations hereunder may be transferred or assigned by Consultant without the
Company’s prior written consent and any attempt to the contrary shall be
void. Any provision hereof found by a tribunal of competent
jurisdiction to be illegal or unenforceable shall be automatically conformed to
the minimum requirements of law and all other provisions shall remain in full
force and effect. Sections 3, 4, 5, 6, 7, 8, 9 and 10 shall
survive termination of this Agreement. Waiver of any provision hereof
in one instance shall not preclude enforcement thereof on future
occasions. Headings are for reference purposes only and have no
substantive effect.
This
Agreement contains the entire understanding of the parties and may not be
amended without the specific written consent of both parties.
11. Consultation with
Counsel.
Consultant
acknowledges that, before executing this Agreement, he has been advised and
given the opportunity to consult with counsel of his own choosing, and was fully
advised of his rights under law. Consultant further acknowledges that
he has reviewed this Agreement in its entirety, understands it, and voluntarily
executes this Agreement.
Exhibit
10.18 Page 5
IN WITNESS WHEREOF, the
Company and Consultant have duly executed this Agreement as of the day and year
first above written.
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Xxxxx
Xxxxxxxx
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Company: KL
Energy Corp.
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Signature:
/s/ Xxxxx
Xxxxxxxx
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By:
/s/ Xxxxxx
Xxxxxxxxx
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Name/Title:
Xxxxx Xxxxxxxx
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Its: Xxxxxx
Xxxxxxxxx/Chairman
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Exhibit
10.18 Page 6
EXHIBIT
A
EMPLOYEE
PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT
In
consideration of my employment with KL Energy Corporation (hereinafter, along
with its parent, subsidiaries and affiliates, referred to as the “Company”), and the
compensation paid to me now and during my employment with the Company I, XXXXX XXXXXXXX, agree to the
terms of this Agreement as follows:
1. Confidential
Information Protections.
1.1 Nondisclosure; Recognition of
Company’s Rights. At all times during and after my employment,
I will hold in confidence and will not disclose, use or publish any of the
Company’s Confidential Information (defined below), except as may be required in
connection with my work for the Company, or as expressly authorized by the Board
of Directors of the Company (the “Board”). I hereby assign
to the Company any rights I may have or acquire in any and all Company
Confidential Information and recognize that all Company Confidential Information
shall be the sole and exclusive property of Company and its
assigns.
1.2 Confidential
Information. The term “Confidential Information”
shall mean any and all confidential knowledge, data or information related to
the Company’s business or its actual or demonstrably anticipated business or
development, including without limitation (a) information regarding products,
services, marketing and business plans, market studies and forecasts,
competitive analyses, budgets, financial statements, contracts, prices, and
profit margins; (b) the names, addresses, phone numbers, preferences, buying
and/or selling histories and other information concerning suppliers, vendors,
customers and prospective customers of the Company; (c) proprietary technology,
trade secrets, patented processes, research and development data, know-how,
databases and data collections, diagrams or designs, models, formulae,
inventions (whether or not patentable), patent applications, registered and
unregistered marks and all goodwill associated with such marks, methods,
processes, procedures, software and software code (in any form, including source
code and executable code), techniques, user interfaces, domain names, URLs, web
sites, registered and unregistered copyrights, works of authorship and other
forms of technology or technical information, and other information (whether or
not embodied in any tangible form and including all tangible embodiments of the
foregoing, such as instruction manuals, prototypes, samples, studies and
summaries) and any reissues, extensions or renewals thereof; (d) employee lists,
employment agreements, personnel policies, and information regarding the skills
and compensation of Company’s employees, contractors, and any other service
providers of Company; (e) the existence of any business discussions,
negotiations, or agreements between Company and any third party; and (f) any of
the above materials, data or information as it relates; to the Company’s parent,
subsidiaries, and affiliated entities provided, however, Confidential
Information shall not include any information that is generally known in the
industry or otherwise becomes available in the public domain, in each case other
than pursuant to a breach of this Agreement.
1.3 Third Party
Information. I understand that the Company has received and in
the future will receive from third parties confidential or proprietary
information (“Third Party
Information”) subject to a duty on the Company’s part to maintain the
confidentiality of such Third Party Information and to use it only for certain
limited purposes. During and after the term of my employment, I will
hold Third Party Information in strict confidence and will not disclose to
anyone (other than Company personnel who need to know such information in
connection with their work for Company), nor will I use Third Party Information
except in connection with my work for the Company or unless expressly authorized
by an officer of the Company in writing.
Exhibit
10.18 Page 7
1.4 No Improper Use of Information of
Prior Employers and Others. I represent that my employment by
the Company does not and will not breach any agreement with any former employer,
including any non-compete agreement or any agreement to keep in confidence or
refrain from using information acquired by me prior to my employmen by
the Company. I further represent that I have not entered into, and
will not enter into, any agreement, either written or oral, in conflict with my
obligations under this Agreement. During my employment by the
Company, I will not improperly make use of, or disclose, any confidential
information or trade secrets of any former employer or other third party, nor
will I bring onto the premises of the Company or use any unpublished documents
or any property belonging to any former employer or other third party, in
violation of any lawful agreements with that former employer or third
party. I will use in the performance of my duties only information
that is generally known and used by persons with training and experience
comparable to my own, is common knowledge in the industry or otherwise legally
in the public domain, or is otherwise provided or developed by the
Company.
2. Inventions.
2.1 Inventions and Intellectual Property
Rights. As used in this Agreement, the term “Invention” means any
proprietary or trade-secret ideas, concepts, Confidential Information,
materials, processes, data, programs, know-how, improvements, discoveries,
developments, designs, artwork, formulae, other copyrightable works, and
techniques and all Intellectual Property Rights in any of the items listed above
as such relate to the business of the Company. The term “Intellectual Property
Rights” means all past, present, and future rights of the
following types, which may exist or be created under the laws of any
jurisdiction in the world: (A) rights associated with works of authorship,
including exclusive exploitation rights, copyrights, moral rights and mask
works; (B) trademark and trade name rights and similar rights; (C) trade secret
rights; (D) patent and industrial property rights; (E) other proprietary rights
in Intellectual Property; and (F) rights in or relating to registrations,
renewals, extensions, combinations, divisions, and reissues of, and applications
for, any of the rights referred to in clauses (A) through (E)
above.
2.2 Ownership of Company Inventions.
I irrevocably assign to the Company all right, title and interest in any
work product that I create or to which I contribute pursuant to this Agreement
related to the business of the Company (the “Work Product”), including all
Intellectual Property Rights contained therein.
2.3 Enforcement of Intellectual Property
Rights and Assistance. During and after the period of my employment, I
will, at the Company’s sole expense, reasonably assist the Company in every
proper way, to obtain and enforce United States and foreign Intellectual
Property Rights relating to Company Inventions in all countries, including
securing my signature on any document needed in connection with such
purposes.
3. Records. I
agree to keep and maintain adequate and current records (in the form of notes,
sketches, drawings and in any other form that is required by the Company) of all
Inventions made by me during the period of my employment by the Company, which
records shall be available to, and remain the sole property of, the Company at
all times.
4. Return Of
Company Property. Upon termination of my employment or upon the Company’s
request at any other time, I will deliver to the Company all of the Company’s
property, equipment, and documents, together with all copies thereof, and any
other material containing or disclosing any Inventions, Third Party Information
or Confidential Information and certify in writing that I have fully complied
with the foregoing obligation. Upon termination of my employment, I
agree that I will not copy, delete, or alter any information contained upon my
Company computer or Company equipment before I return it to
Company. In addition, if I have used any personal computer, server,
or e-mail system to receive, store, review, prepare or transmit any Company
information, including but not limited to, Confidential Information, I agree to
provide the Company with a computer-useable copy of all such Confidential
Information and then permanently delete and expunge such Confidential
Information from those systems; and I agree to allow an independent computer
forensics consultant access to my system as reasonably requested by the Company
to verify that the necessary copying and/or deletion is completed. I
further agree that any property situated on Company premises and owned by the
Company is subject to inspection by Company personnel at any time with or
without notice. Prior to the termination of my employment or promptly
after termination of my employment, I will cooperate with the Company in
attending an exit interview and certify in writing that I have complied with the
requirements of this section.
5. Notification
Of New Employer. If I leave the
employ of the Company, I consent to the notification of my new employer of my
rights and obligations under this Agreement, by the Company providing a copy of
this Agreement or otherwise.
Exhibit
10.18 Page 8
6. General
Provisions.
6.1 Governing Law and
Venue. This Agreement and any action related thereto will be
governed and interpreted by and under the laws of the State of South Dakota,
without giving effect to any conflicts of laws principles that require the
application of the law of a different state. I expressly consent to
personal jurisdiction and venue in the state of South Dakota for any lawsuit or
arbitration filed against me by the Company arising from or related to this
Agreement and I consent to the application of the provisions of Sections 8 and 9
of the Employment Agreement with respect to the resolution of any dispute raised
by the parties hereto.
6.2 Severability. If
any provision of this Agreement is, for any reason, held to be invalid or
unenforceable, the other provisions of this Agreement will remain
enforceable. If the final judgment of a court of competent
jurisdiction or arbitral panel declares that any term or provision hereof is
invalid or unenforceable, the parties hereto agree that the court or arbitral
making such determination shall have the power to limit the term or
provision, to delete specific words or phrases, or to replace any invalid or
unenforceable term or provision with a term or provision that is valid and
enforceable and that comes closest to expressing the intention of the invalid or
unenforceable term or provision, and this Agreement shall be enforceable as so
modified. In the event such court or arbitral panel does not exercise
the power granted to it in the prior sentence, the parties hereto agree to
replace such invalid or unenforceable term or provision that will achieve, to
the extent possible, the economic, business and other purposes of such invalid
or unenforceable term.
6.3 Survival. This
Agreement shall survive the termination of my employment and the assignment of
this Agreement by Company to any successor or other assignee and be binding upon
my heirs and legal representatives.
6.4 Employment. I agree
and understand that nothing in this Agreement shall give me any right to
continued employment by Company, and it will not interfere in any way with my
right or the Company’s right to terminate my employment at any time, with or
without cause.
6.5 Notices. Each party
must deliver all notices or other communications required or permitted under
this Agreement in writing to the other party at the address listed on the
signature page, by courier, by certified or registered mail (postage prepaid and
return receipt requested), or by a nationally-recognized express mail
service. Notice will be effective upon receipt, or refusal by party
of delivery. If delivered by certified or registered mail, notice
will be considered to have been given five (5) business days after it was
mailed, as evidenced by the postmark. If delivered by courier or
express mail service, notice will be considered to have been given on the
delivery date reflected by the courier or express mail service receipt. Each
party may change its address for receipt of notice by giving notice of the
change to the other party.
6.6 Injunctive Relief. I
acknowledge that, because my services are personal and unique and because I will
have access to the Confidential Information of the Company, any breach of this
Agreement by me would cause irreparable injury to Company for which monetary
damages would not be an adequate remedy and, therefore, will entitle Company to
injunctive relief (including specific performance) in accordance with the
provisions of Sections 8 and 9 of my Employment Agreement with the
Company.
6.7 Waiver. Any waiver or failure
to enforce any provision of this Agreement on one occasion will not be deemed a
waiver of that provision or any other provision on any other
occasion.
6.8 Entire
Agreement. If no other agreement governs nondisclosure and
assignment of inventions during any period in which I was previously employed or
am in the future employed by the Company or retained as an independent
contractor, the obligations pursuant to sections of this Agreement titled
“Confidential Information Protections” and “Inventions” shall
apply. This Agreement is the final, complete and exclusive agreement
of the parties with respect to the subject matter hereof and supersedes and
merges all prior communications between us with respect to such matters; provided, however, to the
extent that any of the obligations set forth in this Proprietary Information
Agreement conflict with those set forth in the Employment Agreement, the terms
and conditions of this Proprietary Information Agreement shall control.. If no
other agreement governs nondisclosure and assignment of inventions during any
period in
Exhibit
10.18 Page 9
which I
was previously employed or am in the future employed by the Company as an
independent contractor, the obligations pursuant to sections of this Agreement
titled “Confidential Information Protections” and “Inventions” shall
apply. No modification of or amendment to this Agreement, or any
waiver of any rights under this Agreement, will be effective unless in writing
and signed by me and the Board. Any subsequent change or changes in
my duties, salary or compensation will not affect the validity or scope of this
Agreement.
This
Agreement shall be effective as of the first day of my employment with the
Company.
|
XXXXX
XXXXXXXX:
I have read, understand,
and accept this agreement and have been given the opportunity to Review it
with independent legal counsel.
/s/
Xxxxx X Xxxxxxxx.
(Signature)
Print
Name: Xxxxx
Xxxxxxxx
Date:
24FEB10
Address:
000 Xx. Xxxxxx Xx
Xxxxx
000
Xxxxx
Xxxx, XX 00000
|
KL
ENERGY CORPORATION:
Accepted
and agreed:
/s/
Xxxxxx Xxxxxxxxx
(Signature)
By:
Xxxxxx
Xxxxxxxxx
Title:
Chairman
Date:
February 24, 2010
Address:
000 Xx. Xxxxxx Xx
Xxxxx 000
Xxxxx Xxxx, XX 00000
|
Exhibit
10.18 Page 10
EXHIBIT
B
NONCOMPETITION
AGREEMENT
This
Noncompetition Agreement (the “Agreement”) is being executed and
delivered as of June 9, 2009 (the “Effective
Date”) by XXXXX
XXXXXXXX (“Executive”)
in favor of, and for the benefit of KL ENERGY
CORPORATION,
a Nevada corporation (hereinafter, along with its parent, subsidiaries
and Affiliates, referred to as the “Company”) and
the other “Indemnitees”
(as hereinafter defined). Certain capitalized terms used in this
Noncompetition Agreement are defined in Section 21.
Recitals
Whereas,
the Company and Executive are executing an Employment Agreement (the “Employment
Agreement”) contemporaneously with the execution and delivery of this
Agreement, pursuant to which Executive will provide key executive-level
employment services to the Company; and
Whereas,
as a result of Executive’s employment by the Company, he will be intimately
familiar with the Company’s plans, trade secrets, proprietary information,
business activities and operations;
Now,
Therefore, in order to induce the Company to enter into the Employment
Agreement and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, Executive agrees to the terms set
forth.
Agreement
|
1.
|
Restriction
on Competition.
|
1.1 Executive
agrees that, during the Noncompetition Period, he shall not, and shall not
permit any of his Affiliates to: (a) engage directly or
indirectly in Competition in any Restricted Territory; (b) directly or indirectly be
or become an officer, director, shareholder, owner, co-owner, Affiliate,
partner, promoter, employee, agent, representative, designer, consultant,
advisor, manager, investor, licensor, sublicensor, licensee or sublicensee of,
for or to, or otherwise be or become associated with or acquire or hold (of
record, beneficially or otherwise) any direct or indirect interest in, any
Person or entity that engages directly or indirectly in Competition in any
Restricted Territory; provided, however, that
Executive may, without violating this Section 1, own, as a passive investment,
shares of capital stock of a publicly-held corporation that engages in
Competition if the following three conditions are satisfied: (i) the securities
held are actively traded on an established national securities market in the
United States, (ii) the number of shares of such entity’s equity securities
collectively owned beneficially (directly or indirectly) by Executive and his
Affiliates collectively represent less than one-half of one percent (.5%) of the
total number of equity securities of such entity outstanding, and (iii) neither
Executive nor his Affiliates are otherwise associated directly or indirectly
with such entity or with any Affiliate of such entity.
2. No Hiring or
Solicitation. Executive agrees that, during the Noncompetition
Period, he shall not, and shall not permit any of his Affiliates to: (a) hire a
Specified Worker; or (b) directly or indirectly, personally or through others,
encourage, induce, attempt to induce, solicit or attempt to solicit (on their
own behalf or on behalf of any other Person) any Specified Worker to terminate
his/her/its employment or consulting relationship with the
Company. For
Exhibit
10.18 Page 11
purposes
of this Section 2, a “Specified
Worker” shall mean any individual who is an employee or contractor of the
Company or has been an employee or contractor of the Company within the
preceding six (6) month period.
3. Restriction
on Interference with Business. Executive
agrees that, during Executive’s employment with the Company and after the
termination of that employment for any reason, he will not: (a) discourage,
dissuade, induce or attempt to induce any supplier or customer of the Company
not to enter into a business relationship with the Company or any supplier or
customer of the Company to terminate any of its material relationships with the
Company; or (b) make any public statements or public comments of a defamatory or
disparaging nature regarding the Company or any of its officers, directors,
personnel, products, services, or Affiliates, in any manner likely to be harmful
to it or their business, business reputation or personal
reputation. Nothing in this Section shall prevent Executive from
responding accurately and fully to any request for information when a response
is required by legal process.
4. Confidentiality. Executive
agrees that he shall hold all Confidential Information in strict confidence and
shall fully comply with all terms and conditions of that certain Employee Proprietary Information And
Inventions Agreement between the Company and Executive of even date
herewith..
5. Representations and
Warranties. Executive represents and warrants, to and for the
benefit of the Indemnitees, that: (a) he has full power and capacity to execute
and deliver, and to perform all of his obligations under this Noncompetition
Agreement; and (b) neither the execution and delivery of this Noncompetition
Agreement nor the performance of this Noncompetition Agreement will result
directly or indirectly in a violation or breach of: (i) any agreement or
obligation by which Executive or any of his Affiliates is or may be bound; or
(ii) any law, rule or regulation. The representations and
warranties provided by Executive shall survive the expiration of the
Noncompetition Period for an unlimited period of time.
6. Specific
Performance. Executive agrees that, in the event of any breach
or threatened breach by him of any covenant or obligation contained in this
Noncompetition Agreement, the Company and each of the other Indemnitees shall be
entitled (in addition to any other remedy that may be available to it, including
monetary damages) to seek and obtain relief pursuant to the provisions of
Sections 8 and 9 of the Employment Agreement. Executive further
agrees that no Indemnitee shall be required to obtain, furnish or post any bond
or similar instrument in connection with or as a condition to obtaining any
remedy referred to in this Section 6, and Executive hereby irrevocably waives
any right he may have to require any Indemnitee to obtain, furnish or post any
such bond or similarly instrument.
7. Indemnification. Without
in any way limiting any of the rights or remedies otherwise available to any of
the Indemnitees, Executive agrees to indemnify and hold harmless each Indemnitee
against and from any loss, damage, injury, harm, detriment, lost opportunity,
liability, exposure, claim, demand, settlement, judgment, award, fine, penalty,
tax, fee (including attorneys’ fees), charge or expense (whether or not relating
to any third-party claim) that is directly or indirectly suffered or incurred at
any time (whether during or after the Noncompetition Period) by such Indemnitee,
or to which such Indemnitee otherwise becomes subject at any time
Exhibit
10.18 Page 12
(whether
during or after the Noncompetition Period), and that arises directly or
indirectly out of or by virtue of, or relates directly or indirectly to, any
inaccuracy in or breach of any representation or warranty made by them in this
Noncompetition Agreement, or any failure on his part to observe, perform or
abide by, or any other breach of, any restriction, covenant, obligation or other
provision contained in this Noncompetition Agreement.
8. Non-Exclusivity. The
rights and remedies of the Company and the other Indemnitees under this
Noncompetition Agreement are not exclusive of or limited by any other rights or
remedies which they may have, whether at law, in equity, by contract or
otherwise, all of which shall be cumulative (and not
alternative). Without limiting the generality of the foregoing, the
rights and remedies of the Company and the other Indemnitees under this
Noncompetition Agreement, and the obligations and liabilities of Executive under
this Noncompetition Agreement, are in addition to his rights, remedies,
obligations and liabilities under the law of unfair competition, under laws
relating to misappropriation of trade secrets, under other laws and common law
requirements and under all applicable rules and regulations. Nothing
in this Noncompetition Agreement shall limit any of Executive’s obligations, or
the rights or remedies of the Company or any of the other Indemnitees, under the
Employment Agreement; and nothing in the Employment Agreement shall limit any of
Executive’s obligations, or any of the rights or remedies of the Company or any
of the other Indemnitees, under this Noncompetition Agreement. No
breach on the part of the Company or any other party of any covenant or
obligation contained in the Employment Agreement or any other agreement shall
limit or otherwise affect any right or remedy of the Company or any of the other
Indemnitees under this Noncompetition Agreement.
9. Severability. Any
term or provision of this Noncompetition Agreement that is invalid or
unenforceable in any situation in any jurisdiction shall not affect the validity
or enforceability of the remaining terms and provisions hereof or the validity
or enforceability of the offending term or provision in any other situation or
in any other jurisdiction. If the final judgment of a court of
competent jurisdiction or any arbitral panel declares that any term or provision
hereof is invalid or unenforceable, the parties hereto agree that the court or
arbitral panel making such determination shall have the power
to limit the term or provision, to delete specific words or phrases,
or to replace any invalid or unenforceable term or provision with a term or
provision that is valid and enforceable and that comes closest to expressing the
intention of the invalid or unenforceable term or provision, and this
Noncompetition Agreement shall be enforceable as so modified. In the
event such court or arbitral panel does not exercise the power granted to it in
the prior sentence, the parties hereto agree to replace such invalid or
unenforceable term or provision with a valid and enforceable term or provision
that will achieve, to the extent possible, the economic, business and other
purposes of such invalid or unenforceable term.
10. Specific
Acknowledgements. Executive specifically acknowledges and
agrees that: (a) the promises and restrictive covenants Executive is providing
in this Agreement are reasonable and necessary to the protection of the
Company’s business and to the Company’s legitimate interests in the protection
and preservation of the goodwill and other assets of the Company; and that, if
Executive were to violate the terms of this Agreement, such conduct would
materially and adversely affect the value of the Company and cause the Company
to suffer substantial irreparable harm.
Exhibit
10.18 Page 13
11. Governing
Law; Venue.
11.1 This
Noncompetition Agreement shall be construed in accordance with, and governed in
all respects by, the laws of the State of South Dakota (without
giving effect to principles of conflicts of laws).
11.2 The
provisions of Sections 8 and 9 of the Employment Agreement shall apply to this
Noncompetition Agreement.
11.3 EXECUTIVE
IRREVOCABLY WAIVES THE RIGHT TO A JURY TRIAL IN CONNECTION WITH ANY LEGAL
PROCEEDING RELATING TO THIS NONCOMPETITION AGREEMENT OR THE ENFORCEMENT OF ANY
PROVISION OF THIS NONCOMPETITION AGREEMENT.
12. Waiver. No failure
on the part of the Company or any other Indemnitee to exercise any power, right,
privilege or remedy under this Noncompetition Agreement, and no delay on the
part of the Company, or any other Indemnitee in exercising any power, right,
privilege or remedy under this Noncompetition Agreement, shall operate as a
waiver of such power, right, privilege or remedy; and no single or partial
exercise of any such power, right, privilege or remedy shall preclude any other
or further exercise thereof or of any other power, right, privilege or
remedy. No Indemnitee shall be deemed to have waived any claim of
such Indemnitee arising out of this Noncompetition Agreement, or any power,
right, privilege or remedy of such Indemnitee under this Noncompetition
Agreement, unless the waiver of such claim, power, right, privilege or remedy is
expressly set forth in a written instrument duly executed and delivered on
behalf of such Indemnitee; and any such waiver shall not be applicable or have
any effect except in the specific instance in which it is given.
13. Successors and
Assigns. The Company and/or the other Indemnitees may freely
assign any or all of its rights under this Noncompetition Agreement, at any
time, in whole or in part, to any Person without obtaining the consent or
approval of Executive or of any other Person. This Noncompetition
Agreement shall be binding upon Executive and each of his heirs, executors,
estate, personal representatives, successors and assigns, and shall inure to the
benefit of the Company and the other Indemnitees.
14. Further
Assurances. Executive shall (at his sole expense) execute
and/or cause to be delivered to each Indemnitee such instruments and other
documents, and shall (at the their sole expense) take such other actions, as
such Indemnitee may reasonably request at any time (whether during or after the
Noncompetition Period) for the purpose of carrying out or evidencing any of the
provisions of this Noncompetition Agreement.
15. Attorneys’ Fees. If
any legal action or other legal proceeding relating to this Noncompetition
Agreement or the enforcement of any provision of this Noncompetition Agreement
is brought against Executive, the prevailing party shall be entitled to
recover
Exhibit
10.18 Page 14
reasonable
attorneys’ fees, costs and disbursements (in addition to any other relief to
which the prevailing party may be entitled).
16. Captions. The
captions contained in this Noncompetition Agreement are for convenience of
reference only, shall not be deemed to be a part of this Noncompetition
Agreement and shall not be referred to in connection with the construction or
interpretation of this Noncompetition Agreement.
17. Construction. Whenever
required by the context, the singular number shall include the plural, and vice
versa; the masculine gender shall include the feminine and neuter genders; and
the neuter gender shall include the masculine and feminine
genders. Any rule of construction to the effect that ambiguities are
to be resolved against the drafting party shall not be applied in the
construction or interpretation of this Noncompetition
Agreement. Neither the drafting history nor the negotiating history
of this Noncompetition Agreement shall be used or referred to in connection with
the construction or interpretation of this Noncompetition
Agreement. As used in this Noncompetition Agreement, the words
“include” and “including,” and variations thereof, shall not be deemed to be
terms of limitation, and shall be deemed to be followed by the words “without
limitation.” Except as otherwise indicated in this Noncompetition Agreement, all
references in this Noncompetition Agreement to “Sections” are intended to refer
to Sections of this Noncompetition Agreement.
18. Survival of
Obligations. Except as specifically provided herein, the
obligations of Executive under this Noncompetition Agreement (including his
obligations under Sections 7 and 14) shall survive the expiration of the
Noncompetition Period. The expiration of the Noncompetition Period
shall not operate to relieve Executive of any obligation or liability arising
from any prior
breach of any provision of this Noncompetition Agreement.
19. Obligations
Absolute. Executive’s obligations under this Noncompetition
Agreement are absolute and shall not be terminated or otherwise limited by
virtue of any breach (on the part of the Company any other Indemnitee or any
other Person) of any provision of the Employment Agreement or any other
agreement, or by virtue of any failure to perform or other breach of any
obligation of the Company, Executive, any other Indemnitee or any other
Person.
20. Amendment. This
Noncompetition Agreement may not be amended, modified, altered or supplemented
other than by means of a written instrument duly executed and delivered on
behalf of Executive and the Company (or any successor to the
Company).
21. Defined Terms. For
purposes of this Noncompetition Agreement:
21.1 “Affiliate” means, with
respect to any specified Person, any other Person that, directly or indirectly,
through one or more intermediaries, controls, is controlled by or is under
common control with such specified Person.
Exhibit
10.18 Page 15
21.2 “Competing Business” means (a)
the design, development, sale, distribution, marketing or promotion of process
technologies designed to facilitate the conversion of cellulose derived from
biomass into Cellulosic Based Ethanol (CBE) and those CBE derived products
or services offered by the Company as of the date of this Agreement, and any
other CBE derived product or service designed, developed, distributed, promoted,
marketed, or sold or any CBE derived product or service under development by the
Company, at any time during Executive’s employment with the Company, and (b) if
employed by or acting as an officer, director or manager of an Affiliate of the
Company, the CBE derived products or services designed, developed, distributed,
promoted, marketed, or sold or any CBE derived product or service under
development by such Affiliate(s), at any time during Executive’s employment with
such Affiliate.
21.3 A
Person shall be deemed to be engaged in “Competition” if such Person,
or any of such Person’s subsidiaries or Affiliates is engaged in a Competing
Business.
21.4 “Confidential Information”
means any and all Confidential Information as defined in that Employee
Proprietary Information And Inventions Agreement executed by Executive in
connection with his employment with the Company.
21.5 “Indemnitees” shall include:
(i) the Company; (ii) each Person who is or becomes an Affiliate of the Company;
and (iii) the successors and assigns of each of the Persons referred to in
clauses “(i)” and “(ii)” of this sentence.
21.6 “Noncompetition Period” shall
mean the period commencing on the Effective Date and ending on the date which is
twelve (12) months from the date Executive’s employment with the Company, or any
subsidiary or Affiliate thereof or their respective successors or assigns is
terminated for any reason; provided however, that in the
event of any breach on the part of the Executive of any provision of this
Noncompetition Agreement, in addition to all other rights and remedies available
to the Indemnitees in law, equity or by agreement, the Noncompetition Period
shall be automatically extended by a number of days equal to the total number of
days in the period from the date on which such breach shall have first occurred
through the date as of which such breach shall have been fully
cured.
21.7 “Person” means any: (i)
individual; (ii) corporation, general partnership, limited partnership, limited
liability partnership, trust, company (including any limited liability company
or joint stock company) or other organization or entity; or (iii) governmental
body or authority.
21.8 “Restricted Territory” means
each country within North America, as well as any other country in which the
Company conducts, has conducted, or demonstrably intends to conduct Business,
during the period of Executive’s Employment Agreement and as of the Termination
Date
22. Counterparts/Facsimiles. This
Agreement may be executed in counterparts, each of which shall be deemed to be
an original, but all of which together shall constitute one and the same
instrument. Facsimile or PDF signatures shall be deemed as
enforceable as originals.
[signature
page follows]
Exhibit
10.18 Page 16
In Witness
Whereof, Executive duly executes and delivers this Noncompetition
Agreement as of the date first above written.
| Xxxxx Xxxxxxxx | ||
| /s/ Xxxxx X Xxxxxxxx | ||
| Address: |
000
X Xx. Xxxxxx Xx
Xxxxx
000
Xxxxx
Xxxx, XX
00000
|
|
| Telephone No.: |
( 000 ) 000-0000
|
|
| Facsimile: |
( 000)
000-0000
|
|
| kl energy corporation | ||
| By: |
/s/
Xxxxxx Xxxxxxxxx
|
|
| Xxxxxx Xxxxxxxxx | ||
| Its: |
Chairman
|
|
Exhibit 10.18 Page 17
