CLEAN WIND ENERGY, INC. EXECUTIVE EMPLOYMENT AGREEMENT
Exhibit 10.7
CLEAN WIND ENERGY, INC.
EXECUTIVE EMPLOYMENT AGREEMENT
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement (this “Agreement”), is made as of the 22nd day of
September, 2010, by and between Clean Wind Energy, Inc., a Delaware corporation (the “Company”),
and Xxxx X. Xxxxxxx (“Executive”).
Recitals
The Company has been established to design, develop and construct large Energy Towers that
use non-toxic natural elements to generate electricity and clean water economically by integrating
and synthesizing numerous proven as well as emerging technologies. In addition to constructing
Energy Towers in the United States and abroad, the Company will be prepared to establish
partnerships — at home and abroad — to propagate these systems and meet increasing global demand
for electricity and clean water.
Executive is to be employed by the Company as Chief Technology Officer. The Board of
Directors of the Company recognizes Executive as a key officer of the Company, and consequently
has approved the terms and conditions of the continued employment of Executive as set forth herein
and has authorized the execution and delivery of this Agreement.
Agreement
NOW THEREFORE, for and in consideration of the foregoing and of the mutual covenants of the
parties herein contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Employment. The Company hereby employs Executive to serve in the capacities described
herein and Executive hereby accepts such employment and agrees to perform the services described
herein upon the terms and conditions hereinafter set forth.
2. Term. The term of Executive’s employment pursuant to this Agreement shall commence as
of the date hereof and shall terminate on the third
(3rd) anniversary of the date of
Executive’s receipt of his first paycheck from the Company hereof, subject to earlier termination
in accordance with Section 7 hereof and the other terms, provisions, and conditions set forth
herein (the “Term”). The Term shall be renewable for One (1) -year periods upon the mutual
agreement of the parties.
3. Duties. During the Term, Executive shall serve as and have the title of Chief
Technology Officer of the Company. Executive agrees to devote the time, energy, and skills to such
employment on a full-time basis and otherwise as is required to properly and fully perform his
duties under this Agreement. Executive agrees to use his reasonable best efforts to advance the
goals of the Company.
CLEAN WIND ENERGY, INC.
EXECUTIVE EMPLOYMENT AGREEMENT
EXECUTIVE EMPLOYMENT AGREEMENT
4. Compensation.
(a) Base Compensation. The Company shall pay Executive, and Executive agrees to
accept, base compensation at the rate of $175,000 per year in equal Bi-weekly installments
commencing as of 1 November, 2010, through the Term of this Agreement (the “Base
Compensation”). The Base Compensation may be increased at any time during the Term of this
Agreement at the discretion of the Board of Directors. No increase in the Base Compensation shall
at any time operate as a cancellation of this Agreement; any such increase shall operate merely as
an amendment hereof, without any further action by Executive or the Company. If any such increase
or increases shall be so authorized, all of the terms, provisions and conditions of this Agreement
shall remain in effect as herein provided, except that the Base Compensation shall be deemed
amended to set forth the increased amount of such Base Compensation to Executive.
(b) Bonus Compensation. Executive shall be eligible to receive an annual bonus
(“Bonus Compensation”) following the end of each fiscal year of the Company during the
Term of Executive’s employment under this Agreement. The amount of Executive’s Bonus Compensation,
if any, shall be determined by the Board of Directors of the Company, in its sole discretion,
based upon the performance of Executive and the Company during such fiscal year.
(c) Founder Stock. Executive shall be granted 16,000 shares of the Company’s common
stock (of 100.000 shares currently authorized of which 75,000 shares have been issued),
representing Founder Stock in consideration for payment of $16.00 and the Executive’s
contributions towards the establishment of the Company. Executive’s Founder Shares. Said Founder
Stock shall be issued to Executive within 60 (sixty) days of the date of execution of this
Agreement. Ownership of the Founder Stock is subject to the following conditions during the 36
month term of this Agreement:
(i) If the Executive’s employment is terminated voluntarily at any time during the first
twelve (12) months, all Founder shares are forfeited and returned to the Company.
(ii) In the event that the Executive’s employment is terminated due to death at any time
during the first twelve (12) months of this Agreement, fifty (50%) percent of the Founder shares
will be distributed to the Executive’s designated beneficiary and the remaining shares will be
forfeited and returned to the Company.
(iii) In the event that the Executive’s employment is terminated due to death at any time
after the first twelve (12) months of this Agreement, fifty (50%) percent of the Founder
shares will be distributed to the Executive’s designated beneficiary plus an additional number of
shares equal to 1/24th of the remaining fifty (50%) percent of the founder’s shares for each month
the Executive was employed by the Company during the 13th through the 24th
month of this Agreement prior to termination. All remaining shares will be forfeited and returned
to the Company.
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CLEAN WIND ENERGY, INC.
EXECUTIVE EMPLOYMENT AGREEMENT
EXECUTIVE EMPLOYMENT AGREEMENT
(iv) In the event that the Executive’s employment is terminated by disability (as defined in
paragraph 7.b), twenty five (25%) of the Executive’s Founder shares are owned without condition and
the remaining Founder shares will be distributed to the Executive based on the formula of 1/36th of
the remaining seventy five (75%) percent of the founder’s shares for each month the Executive was
employed by the Company prior to termination due to disability. All remaining shares will be
forfeited and returned to the Company.
5. Benefits.
(a) In General. Executive shall be eligible to participate in any incentive,
insurance, pension or other employee benefit plans approved by the Board of Directors that now or
hereafter may be made available to employees of the Company and for which Executive will qualify
according to his eligibility under the provisions thereof.
(b) Paid Time Off. During the Term of this Agreement, Executive shall be entitled to
Three (3) weeks paid time off per calendar year, to be taken at such times that do not materially
interfere with the development or operations of the Company. Employee shall be entitled to paid
time off for each federal and state holidays, as may be defined in the Company’s Employee’s
Handbook, as adopted by the Company’s Board of Directors and which may be issued to the Company’s
Employees. Any paid time off not taken during any calendar year shall not be carried over into
subsequent calendar years.
6. Expenses. During the Term, Executive shall be reimbursed for all business-related
expenses incurred on behalf of the Company in accordance with the travel and entertainment expense
policy of the Company as adopted by the Board of Directors from time to time and in effect at the
time the expense was incurred. Executive agrees to maintain such records and documentation of all
such expenses to be reimbursed by the Company as the Company shall require and in such detail as
the Company may reasonably request.
7. Termination. Executive’s employment under this Agreement cannot be terminated prior to
expiration of the Term of this Agreement except in accordance with the following paragraphs.
(a) Mutual Agreement. Executive’s employment under this Agreement may be terminated
upon the mutual written agreement of the Company and Executive.
(b) Death or Disability. Executive’s employment under this Agreement shall be
terminated upon the death of Executive. Executive’s employment under this Agreement may be
terminated upon thirty (30) days’ written notice to Executive if Executive shall be unable to
perform his duties substantially as required by this Agreement by reason of physical or mental
disability or incapacity (from any cause or causes whatsoever) and Executive shall fail to perform
such duties substantially as required for a period of more than 90 (ninety) days, whether or not
continuous, in any continuous 120 (one hundred twenty) day period.
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CLEAN WIND ENERGY, INC.
EXECUTIVE EMPLOYMENT AGREEMENT
EXECUTIVE EMPLOYMENT AGREEMENT
(c) For Cause. Executive’s employment under this Agreement may be terminated
immediately by the Company for Cause (as defined below). For purposes of this Agreement, the term
“Cause” shall mean the existence or occurrence of one or more of the following conditions
or events:
(i) if the Company’s Board of Directors determines in its discretion that the services
provided by Executive fall materially below the Company’s expectations as communicated to
Executive and are not corrected within 30 (thirty) days of receipt of written notice;
(ii) commission of willful and intentional acts involving gross misconduct (including,
without limitation, theft, fraud or embezzlement) on Executive’s part;
(iii) Executive’s conviction of, or plea of guilty or nolo contendere to, a felony or a crime
involving moral turpitude;
(iv) habitual drunkenness or substance abuse by Executive; or
(v) a material breach by Executive of any provision of this Agreement or of any contractual or
legal duty to the Company, including, but not limited to, the unauthorized disclosure of
confidential information, and willful material non-compliance with the written policies, guidelines
and procedures of the Company in accordance with generally accepted corporate practices that
remains uncured after 30 (thirty) business days following a written notice from the Board of
Directors of the Company to cure.
8. Severance — Mutual Agreement, Death or Disability or For Cause
In the event Executive’s employment under this Agreement is terminated (i) by reason of mutual
agreement, (ii) in connection with Executive’s death or disability, (iii) by the Company for
Cause, the Company shall pay Executive (or in the case of death, his heirs and/or personal
representatives), within thirty (30) days after the date of termination, Executive’s Base
Compensation and benefits and all expenses payable under Section Six (6) hereof through such date
of termination, and the Company shall have no further obligation to provide compensation or
benefits to Executive under this Agreement; provided, however, that to the extent that any of the
Company’s benefit plans provide rights or benefits after an employee’s termination, Executive may
continue to receive such rights or benefits in accordance with the terms of such plans. Upon
dissolution or liquidation of the Company, or upon a merger or consolidation in which the Company
is not the surviving corporation, Options awarded to the Executive under the Employee Stock
Ownership Plan, which the Company’s Board of Directors may duly establish and empower (ESOP) and
not previously exercised and vested shall become fully exercisable and vested no later than the
date of such dissolution, merger or consolidation, and the Executive shall have the right to
exercise such Executive’s Options in whole or in part at any time within the next four (4) years.
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CLEAN WIND ENERGY, INC.
EXECUTIVE EMPLOYMENT AGREEMENT
EXECUTIVE EMPLOYMENT AGREEMENT
9. Confidential and Proprietary Information. Executive recognizes and acknowledges that he
will have access to certain confidential information of the Company and of entities with which the
Company does business, and that such information constitutes valuable, special and unique property
of the Company and such other entities. During the Term of this Agreement and for a period of two
(2) years immediately following the date of termination of this Agreement, Executive agrees not to
disclose or use any confidential information, except as in furtherance of the Company’s missions,
including without limitation, information concerning the Company’s financial condition, research
and development activities, technologies, product designs and/or specifications, “know-how,”
prices, customers, prospects, methods of doing business, marketing and promotional activities, or
any information or knowledge with respect to confidential information or trade secrets of the
Company, it being understood that such confidential information does not include information that
is publicly available unless such information became publicly available as a result of a breach of
this Agreement. Executive acknowledges and agrees that all notes, records, reports, sketches,
plans, unpublished memoranda or other documents belonging to the Company, but held by Executive,
concerning any information relating to the Company’s business, whether confidential or not, are the
property of the Company and will be promptly delivered to it upon Executive’s leaving the employ of
the Company. Executive also agrees to execute such confidentiality agreements that the Board of
Directors may adopt, and may modify from time to time, as a standard form to be executed by all
employees of the Company, to the extent such standard forms are not materially more restrictive
than the provisions of this Agreement.
10. Intellectual Property.
Company and Executive acknowledge and agree that:during the period of the Executive’s employment
with the Company:
a.: all discoveries, inventions, designs, improvements, formulas, formulations, ideas, devices,
writings, publications, study protocols, study results, computer data or programs, or other
intellectual property, whether or not subject to patent or copyright laws, which Executive
shall conceive solely or jointly with others, in the course or scope of his employment with the
Company (collectively referred to herein as “Company Intellectual Property”), shall be
the sole and exclusive property of the Company without further compensation to the Executive.
b. all discoveries, inventions, designs, improvements, formulas, formulations, ideas, devices,
writings, publications, study protocols, study results, computer data or programs, or other
intellectual property, whether or not subject to patent or copyright laws, which Executive
conceived solely or jointly with others, prior to his employment with the Company and that
apply to or pertain to or facilitate or assist or augment or are otherwise useful to the
Company’s development and construction of Energy Towers shall be made available via assignment
and/or license by Executive to the Company to enable the Company to develop and construct
Energy Towers without further compensation or expectation of remuneration by the Company.
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CLEAN WIND ENERGY, INC.
EXECUTIVE EMPLOYMENT AGREEMENT
EXECUTIVE EMPLOYMENT AGREEMENT
c. all discoveries, inventions, designs, improvements, formulas, formulations, ideas, devices,
writings, publications, study protocols, study results, computer data or programs, or other
intellectual property, whether or not subject to patent or copyright laws, which Executive
conceived solely or jointly with others, prior to his employment with the Company and that
apply to or pertain to or facilitate or assist or augment or are otherwise useful to the
Company’s development and construction of Energy Towers and/or other constructions, buildings
or engineering projects which Executive has made available via license to the Company may be
licensed or sub-licensed by the Company to third parties provided that said third parties agree
to fully protect the licensed intellectual property and to use said intellectual property
solely for the construction of Energy Towers.
11. Non-Competition; Non-Solicitation. Executive acknowledges that the services of
Executive to be rendered hereunder are of a special and unusual character that have a unique value
to the Company and the conduct of its business, the loss of which cannot adequately be compensated
by damages in an action at law. In view of the unique value to the Company of the services of
Executive for which the Company has contracted hereunder, and because of the confidential
information to be obtained by or disclosed to Executive as herein above set forth, and as a
material inducement to the Company to enter into this Agreement and to pay and make available to
Executive the compensation and other benefits referred to herein, Executive covenants and agrees as
follows:
(a) Non-Solicitation. While employed by the Company and for a period of One (1) year
thereafter, Executive shall not directly or indirectly, for himself or for any other person,
business, firm, corporation, partnership, association or other entity, attempt to employ or enter
into any contractual arrangement with any current or former employee, nonemployee instructor, or
other independent contractor performing services for the Company, unless such person has not been
employed by or otherwise performed services for the Company for a period of more than two (2)
months.
(b) Non-Competition. While employed by the Company and for a period of One (1) year
thereafter, Executive shall not, directly or indirectly, engage in, operate, have any investment
or interest or otherwise participate in any manner (whether as an employee, officer, director,
partner, agent, security holder, creditor, consultant or otherwise) in any Competing Business (as
defined below); provided, that Executive may continue to hold securities and/or acquire, solely as
an investment, shares of capital stock or other equity securities of any company that is publicly
traded, so long as Executive does not control, acquire a controlling interest in, or become a
member of a group which exercises direct or indirect control of, more than five percent (5%) of
any class of capital stock of such company. For purposes of this Agreement, the term
“Competing Business” means any corporation, company, partnership, sole proprietorship,
business, or other person or entity that is engaged in the design, development of energy resources
and or the production of electrical energy.
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CLEAN WIND ENERGY, INC.
EXECUTIVE EMPLOYMENT AGREEMENT
EXECUTIVE EMPLOYMENT AGREEMENT
Executive has carefully read and considered the provisions of Sections 9 and 11 hereof and
agrees that the restrictions set forth in such sections are fair and reasonable and are reasonably
required for the protection of the interests of the Company, its officers, directors, shareholders,
and other employees, for the protection of the business of the Company. Executive acknowledges that
he is qualified to engage in businesses other than those that are subject to this Section 11. It is
the belief of the parties, therefore, that the best protection that can be given to the Company
that does not in any way infringe upon the rights of Executive to engage in any unrelated
businesses is to provide for the restrictions described above. In view of the substantial harm
which would result from a breach by Executive of Sections 9 or 11, the parties agree that the
restrictions contained therein shall be enforced to the maximum extent permitted by law. In the
event that any of said restrictions shall be held unenforceable by any court of competent
jurisdiction, the parties hereto agree that it is their desire that such court shall substitute a
reasonable judicially enforceable limitation in place of any limitation deemed unenforceable and
that as so modified, the covenant shall be as fully enforceable as if it had been set forth herein
by the parties.
12. Remedies.
Except as provided in the next paragraph, in the event that a dispute arises between
Executive and the Company concerning any matter under this Agreement, such dispute shall be
resolved through binding arbitration which shall be conducted before three (3) impartial
arbitrators. One arbitrator shall be selected by each party and the two arbitrators who are so
selected shall select the third arbitrator. Any such arbitration shall be held in the county of
residence of the alleged offender. The arbitrators shall reach a decision in the arbitration based
on the facts of the matter and applicable law. The Company and the Executive shall equally share
all costs and fees in connection with the arbitration.
The restrictions set forth in Sections 9 and 11 are considered to be reasonable for the
purposes of protecting the business of the Company. The Company and Executive acknowledge that the
Company would be irreparably harmed and that monetary damages would not provide an adequate remedy
to the Company if the covenants contained in Sections 9 and 11 were not complied with in
accordance with their terms. Accordingly, Executive agrees that the Company shall be entitled to
injunctive and other equitable relief to secure the enforcement of these provisions, in addition
to any other remedy which may be available to the Company. Any legal action commenced by the
Company to secure the enforcement of Section 9 and 11 shall be commenced in the county of
residence of the alleged offender. Each party will pay their own legal expenses in the event of
such action. The provisions of sections 9 and 11 of this Agreement shall survive the termination
of this Agreement, regardless of the circumstances or reasons for such termination, and inure to
the benefit of the Company.
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CLEAN WIND ENERGY, INC.
EXECUTIVE EMPLOYMENT AGREEMENT
EXECUTIVE EMPLOYMENT AGREEMENT
13. Notices. Any notice required or permitted to be given under this Agreement shall be
sufficient if in writing and if sent by registered mail to the addresses below or to such other
address as either party shall designate by written notice to the other:
If to Executive, to the address set forth below his signature on the signature page hereof.
If to the Company to:
Clean Wind Energy, Inc.
0000 Xxxxxxxxx Xxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxx Xxxxxxxx, 00000
0000 Xxxxxxxxx Xxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxx Xxxxxxxx, 00000
14. General Provisions.
(a) This Agreement contains the entire agreement of the Company and Executive, and the
Company and Executive hereby acknowledge and agree that this Agreement supersedes any prior
statements, writings, promises, understandings or commitments. No future oral statements, promises
or commitments with respect to the subject matter hereof, or other purported modification hereof,
shall be binding upon the parties hereto unless the same is reduced to writing and signed by all
parties hereto.
(b) The rights and obligations of the Company under this Agreement shall inure to the benefit
of and shall be binding upon the successors and assigns of the Company. Executive may not assign
his rights and obligations under this Agreement.
(c) This Agreement shall be subject to and governed by the laws of the State of residence of
the Executive without regard to the conflict of laws principles thereof.
(d) The section headings contained herein are for reference purposes only and shall not in
any way affect the meaning or the interpretation of this Agreement.
(e) The failure of any party to enforce any provision of this Agreement shall in no manner
affect the right to enforce the same, and the waiver by any party of any breach of any provision
of this Agreement shall not be construed to be a waiver by such party of any succeeding breach of
such provision or a waiver by such party of any breach of any other provision.
(f) In the event any one or more of the provisions of this Agreement shall for any reason be
held invalid, illegal or unenforceable, the remaining provisions of this Agreement shall be
unimpaired, and the invalid, illegal or unenforceable provision shall be replaced by a mutually
acceptable valid, and enforceable provision which comes closest to the intent of the parties.
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CLEAN WIND ENERGY, INC.
EXECUTIVE EMPLOYMENT AGREEMENT
EXECUTIVE EMPLOYMENT AGREEMENT
(g) This Agreement may be executed in any number of counterparts, each of which shall
constitute an original and all of which together shall constitute one and the same instrument.
The parties have executed this Employment Agreement as of the day and year below written.
September 22, 2010
(date)
(date)
| THE COMPANY: Clean Wind Energy, Inc. |
||||
| /s/ Xxx Xxxxxxx | ||||
| By: | Xxx Xxxxxxx | |||
| Its: | Chief Executive Officer | |||
| EXECUTIVE: |
||||
| /s/ Xxxx X. Xxxxxxx | ||||
| By: | Xxxx X. Xxxxxxx | |||
| Address: | 000 Xxxxxxxx Xxxx Xxxxx Xxxx, XX 00000 |
|||
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CLEAN WIND ENERGY, INC.
EXECUTIVE EMPLOYMENT AGREEMENT AMENDMENT
EXECUTIVE EMPLOYMENT AGREEMENT AMENDMENT
This Amendment to Executive Employment Agreement (this “Agreement”), is made as
of the 22nd day of November, 2010, by and between Clean Wind Energy, Inc., a
Delaware corporation (the “Company”), and Xxxx X. Xxxxxxx (“Executive”)
pursuant to a resolution of all the founding directors of Clean Wind Energy, INC., a Delaware
corporation (the “Corporation”), by unanimous written consent in lieu of an organizational
meeting of the directors in accordance with section 141(f) of the Delaware General
Corporation Law.
Modification of Founder Stock Terms in Founders Employment Agreements
RESOLVED, that the Founder Stock-Section (C) sub-section (i) of the Founders
Employment Agreements dated September 22, 2010 be amended with the following changes:
(i) During the first twelve (12) months of employment: (a) If the Executive’s employment
is terminated voluntarily at any time during the first 90 days, all Founder shares are
forfeited and returned to the Company. (b) If the Executive’s employment is terminated
voluntarily at any time after the first 90 days, 90% of the Founder shares are forfeited and
returned to the Company.
Executive Employment Agreement is hereby amended according to the General
Provisions-Section 14 Sub-section (a) by the signature of the Executive acknowledging this
Amendment.
Executive
|
Company | |
/s/ Xxxx X. Xxxxxxx
|
/s/ Xxxxxx Xxxxxxx | |
Xxxx X. Xxxxxxx
|
Xxxxxx Xxxxxxx, Chief Executive Officer |
