AEMETIS, INC. ANDREW FOSTER EMPLOYMENT AGREEMENT
Exhibit 10.3
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This
Agreement is made by and between Aemetis, Inc. (the
“Company”) and ▇▇▇▇▇▇ ▇▇▇▇▇▇ (“Executive”)
to be effective as of January 1, 2020 (the “Effective
Date”).
1. Duties and Scope of
Employment.
a. Position; Duties.
Executive’s employment with the Company pursuant to this
Agreement is effective as of the Effective Date. Commencing as of
the Effective Date, the Company shall continue to employ the
Executive as Executive Vice President and Chief Operating Officer,
reporting to the Chief Executive Officer of the Company.
During the Employment
Term (as defined below), Executive shall render such business and
professional services in the performance of his duties as are
consistent with Executive’s position within the Company, and
as shall reasonably be assigned to him by the Chief Executive
Officer.
b. Obligations. During the
Employment Term, Executive shall devote reasonable business efforts
and time to the Company. Executive agrees during the Employment
Term, not to actively engage in any directly competitive
employment, occupation or consulting activity for any direct or
indirect remuneration without the prior approval of the Chief
Executive Officer; provided, however, that Executive may serve in
any capacity with any civic, educational or charitable
organization.
2. Employment Term. It is intended
that the employment arrangement contemplated by this Agreement
shall continue until the third anniversary of the Effective Date,
with automatic one-year extensions thereafter unless terminated by
either party on sixty days' notice prior to the end of each
respective extension year (such three-year period and any
extensions being referred to herein as the “Employment
Term”). Notwithstanding the foregoing, the parties agree that
neither this Agreement nor any provision herein is intended to
guarantee the continuation of Executive’s employment for the
duration of the Employment Term. In the event that
Executive’s employment with the Company terminates prior to
the expiration of the Employment Term for any reason, the parties
agree that Executive shall be entitled to receive only those
benefits that are expressly provided by this Agreement in such
circumstances.
3. Executive Benefits. During the
Employment Term, Executive shall be eligible to participate in the
Executive and fringe benefit plans maintained by the Company that
are applicable to other Executives of the Company to the full
extent provided for under those plans for the position held by the
Executive.
4. Vacation. During the Employment
Term, Executive shall have four weeks of paid vacation per year,
defined as 160 hours per year. Unused vacation may carry over to
the next benefit year, subject to a maximum vacation cap of 160
hours. In the event of termination, any unused vacation weeks shall
be paid as salary continuation.
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5. Expenses. While Executive is
employed during the Employment Term, the Company will reimburse
Executive for reasonable travel, entertainment or other expenses
incurred by Executive in the furtherance of or in connection with
the performance of Executive's duties hereunder, in accordance with
the Company's expense reimbursement policy as in effect from time
to time.
6. Compensation.
a. Base Salary. During the
Employment Term, the Company shall pay the Executive as
compensation for his services a base salary at the annualized rate
of Two Hundred Thirty Thousand ($230,000) per year (the “Base
Salary”). Such salary shall be paid periodically in
accordance with normal Company payroll practices and subject to
required withholding and applicable deductions. Executive’s
Base Salary shall be reviewed annually by the Company for possible
adjustments in light of Executive’s performance and
competitive data, and any such adjusted amount shall, from and
after the effective date of the adjustment, constitute “Base
Salary” for purposes of this Agreement.
b. Bonus. Executive shall be
entitled to receive, within 90 days after the end of each year, an
annual bonus (the “Bonus”) of up to $50,000 based upon
Executive’s performance and other criteria to be established
by the Company. Executive shall not earn any Bonus with respect to
a fiscal year, and the right to a Bonus shall not vest or become
payable, unless Executive is employed by the Company during the
entire applicable bonus period such Bonus is paid. With respect to
any subjective milestones, the determination of whether Executive
has attained the mutually agreed upon milestones for the Bonus
shall be reasonably determined by the Executive’s
supervisor.
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i. Involuntary Termination Other Than for
Cause; Constructive Termination. If Executive’s
employment with the Company is Constructively Terminated or
involuntarily terminated by the Company other than for Cause (as
defined below), Executive’s death, or Executive’s Total
Disability, then, subject to Executive executing and not revoking a
standard form of mutual release of claims with the
Company, Executive shall be
entitled to receive continuing payments of severance pay (less
applicable withholding taxes) at the rate equal to
Executive’s Base Salary, as then in effect, for a period of
one (1) year from the date of such termination in accordance with
the Company’s normal payroll practices (“Severance
Payments”). In addition to the Severance Payments, Executive
shall receive at the Company’s expense 100% of Company-paid
health, dental and vision insurance benefits at the same level of
coverage as was provided to Executive immediately prior to the
termination of Executive’s employment with the Company
(“Company-Paid Coverage”). If such coverage included
Executive’s dependents immediately prior to Executive’s
termination, such dependents shall also be covered at the
Company’s expense. Company-Paid Coverage shall continue until
the earlier of (i) one (1) year following the date of the
termination of Executive’s employment, or (ii) the date upon
which Executive or Executive’s dependents become covered
under another employer’s group health, dental and vision
insurance benefit plans.
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ii. Involuntary Termination Other Than for
Cause; Constructive Termination On or Following Change of
Control. If Executive’s employment with the Company is
Constructively Terminated or involuntarily terminated by the
Company other than for Cause in connection with or within one (1)
year following a Change in Control, then, subject to Executive
executing and not revoking a standard form of mutual release of
claims with the Company, in addition to the Severance Payments and
the Company-Paid Coverage set forth in Section 6(c)(i) above, all of
Executive’s stock options and restricted stock shall
immediately accelerate vesting as to 100% of the then unvested
shares.
iii. Cause
Definition. For the purposes of this Agreement,
“Cause” means (1) Executive’s material,
willful and continuing breach of his obligations to the Company
after thirty (30) days written notice from the Company
specifying the nature of Executive’s breach and demanding
that such breach be remedied (unless such breach by its nature
cannot be cured, in which case notice and an opportunity to cure
shall not be required); (2) Executive’s conviction of a
felony that is materially and substantially injurious to the
Company or its business; or (3) act or acts of dishonesty by
Executive that are materially and substantially injurious to the
Company or its business.
iv. Constructive Termination
Definition. For the purposes of this Agreement,
“Constructive Termination” means, without
Executive’s written consent, (i) a material reduction in
Executive’s salary or benefits; provided, however, that a
reduction in Executive’s salary or benefits will not
constitute a Constructive Termination if it is part of and
proportional to a reduction in salary or benefits of the
Company’s executive staff as a whole, (ii) a material
diminution of Executive’s officer title, duties, authority or
responsibilities as in effect immediately prior to such diminution.
Notwithstanding the foregoing, no Constructive Termination for any
of the foregoing reasons shall be effective unless and until (A)
Executive provides the Company with written notice specifying the
event which constitutes Constructive Termination within ninety (90)
days following the occurrence of such event or date Executive
became aware of such event, the Company fails to cure the
circumstances giving rise to Constructive Termination within thirty
(30) days after such notice, and Executive resigns within ninety
(90) days after the expiration of the Company’s thirty
(30)-day cure period.
v. Change of Control Definition.
For the purposes of this Agreement, “Change of Control”
means, in one or a series of transactions: (1) a
reorganization or merger of the Company with or into any other
Company which will result in the Company’s shareholders
immediately prior to such transaction not holding, as a result of
such transaction, at least 50% of the voting power of the surviving
or continuing entity or the entity controlling the surviving or
continuing entity; (2) a sale of all or substantially all of
the assets of the Company which will result in the Company’s
shareholders immediately prior to such sale not holding, as a
result of such sale, at least 50% of the voting power of the
purchasing entity; (3) a change in the majority of the Board
not approved by at least two-thirds of the Company’s
directors in office prior to such change; or (4) the adoption
of any plan of liquidation providing for the distribution of all or
substantially all of the Company’s assets.
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vi. Total Disability Definition.
For the purposes of this Agreement, “Total Disability”
shall mean Executive’s mental or physical impairment which
has or is likely to prevent Executive from performing the
responsibilities and duties of his position for three (3) months or
more in the aggregate during any six (6) month period. Any question
as to the existence or extent of Executive’s disability upon
which the Executive and the Company cannot agree shall be resolved
by a qualified independent physician who is an acknowledged expert
in the area of the mental or physical impairment, selected in good
faith by the Board and Executive (or his personal
administrator).
vii. No
Mitigation. Except as specifically provided herein, the
Executive shall not be required to mitigate the value of any
severance benefits contemplated by this Agreement, nor shall any
such benefits be reduced by any earnings or benefits that the
Executive may receive from any other source.
viii. Voluntary
Termination other than pursuant to a Constructive Termination;
Involuntary Termination for Cause. If, during the Employment
Term, the Executive’s employment is terminated by the Company
for Cause, or by Executive for any reason, other than death, Total
Disability or pursuant to a Constructive Termination, then all
further vesting of any option, restricted stock award or other
Company equity compensation held by Executive will cease
immediately (however, Executive shall be permitted to exercise
vested options for the time period specified in his option
agreements and he shall retain all vested restricted shares) and
all payments of compensation by the Company to Executive hereunder
will terminate immediately (except as to amounts already earned and
unpaid).
ix. Involuntary Termination on
Death. If, during the Employment Term, the Executive's
employment is terminated as a result of Executive’s death,
then 50% of unvested equity awards from the Company then held by
Executive shall immediately vest, or if Executive is then holding
unvested shares, the Company’s right to repurchase the
then-unvested shares under each such equity award shall lapse, with
respect to 50% of the shares under each such award.
7. Assignment. This Agreement
shall be binding upon and inure to the benefit of (a) the
heirs, beneficiaries, executors and legal representatives of
Executive upon Executive’s death and (b) any successor
of the Company. Any such successor of the Company shall be deemed
substituted for the Company under the terms of this Agreement for
all purposes. As used herein, “successor” shall include
any person, firm, corporation or other business entity which at any
time, whether by purchase, merger or otherwise, directly or
indirectly acquires all or substantially all of the assets or
business of the Company.
8. Notices. All notices, requests,
demands and other communications called for hereunder shall be in
writing and shall be deemed given if (i) delivered personally
or by facsimile, (ii) one (1) day after being sent by Federal
Express or a similar commercial overnight service, or
(iii) three (3) days after being mailed by registered or
certified mail, return receipt requested, prepaid and addressed to
the parties or their successors in interest at the following
addresses, or at such other addresses as the parties may designate
by written notice in the manner aforesaid:
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a.
If to the
Company:
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Fax:
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b.
If to
Executive:
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Such
address as shall most currently appear on the records of the
Company.
9. Proprietary Information
Agreement. Executive agrees to enter into the
Company’s standard Employment, Confidential Information and
Invention Assignment Agreement (the “Proprietary Information
Agreement”) upon commencing employment
hereunder.
10. Section 409A. If at any time
Executive is a “specified employee” (as defined in
Treasury Regulation Section 1.409A-1(i)), any amounts payable to
Executive by reason of Executive’s termination of employment
pursuant to this Agreement or otherwise will be delayed for a
period of six (6) months following the date of termination, and
shall instead be paid, without interest, to Executive in a lump sum
on the first (1st) day of the seventh
(7th)
month following the date of termination. The amount of expenses for
which Executive is eligible to receive reimbursement during any
calendar year shall not affect the amount of expenses for which
Executive is eligible to receive reimbursement during any other
calendar year during the Employment Term, and any reimbursement
payable in accordance with Section 5 will not be subject
to liquidation or exchange for any other benefit. This Agreement is
intended to satisfy the requirements of Section 409A of the
Internal Revenue Code, as amended, and other guidance promulgated
thereunder (“Section
409A”) and shall be interpreted, construed and
administered in a manner consistent with that intent. If either
party notifies the other in writing that one or more or the
provisions of this Agreement contravenes any Treasury Regulations
or guidance promulgated under Section 409A, or causes any amounts
to be subject to interest, additional tax or penalties under
Section 409A, the parties shall agree to negotiate in good faith to
make amendments to this Agreement as the parties mutually agree,
reasonably and in good faith are necessary or desirable, to (i)
maintain to the maximum extent reasonably practicable the original
intent of the applicable provisions without violating the
provisions of Section 409A or increasing the costs to the Company
of providing the applicable benefit or payment and (ii) to the
extent possible, to avoid the imposition of any interest,
additional tax or other penalties under Section 409A upon the
parties, provided that, notwithstanding the foregoing, the Company
makes no representation that amounts payable under this Agreement
will comply with Section 409A and makes no undertaking to prevent
Section 409A from applying to any amounts paid under this
Agreement. Additionally, the Company intends that each right to
payment made pursuant to this Agreement shall be treated as a
“separate payment” for purposes of the application of
Section 409A.
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11. Entire Agreement. This
Agreement, the Executive benefit plans referred to in Section 3 and the
Proprietary Information Agreement represent the entire agreement
and understanding between the Company and Executive concerning
Executive’s employment relationship with the Company, and
supersede and replace any and all prior agreements, arrangements
and understandings, written or oral, concerning Executive’s
employment relationship with the Company, including the employment
agreement by and between the Executive and the Company dated May
22, 2007.
12. No Oral Modification, Cancellation or
Discharge. This Agreement may only be amended, canceled or
discharged in writing signed by Executive and the Company’s
Executive Chairman.
13. Withholding. The Company shall
be entitled to withhold, or cause to be withheld, from payment any
amount of withholding taxes required by federal, state or local law
with respect to payments made to Executive in connection with his
employment hereunder. Executive shall be considered an employee of
the Employer for federal, state and local tax purposes, and
Executive’s employment with the Employer shall not be deemed
“self-employment” for federal, state and local tax
purposes.
14. Waiver. The failure of either
party to insist upon strict compliance with any provision of this
Agreement or to assert any right either party may have hereunder
shall not be deemed to be a waiver of such provision or right or
any other provision or right of this Agreement.
15. JURY TRIAL WAIVER. THE PARTIES
EXPRESSLY AND KNOWINGLY WAIVE ANY RIGHT TO A JURY TRIAL IN THE
EVENT ANY ACTION ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT
OR THE EXECUTIVE’S EMPLOYMENT WITH THE COMPANY IS LITIGATED
OR HEARD IN ANY COURT.
16. Governing Law. This Agreement
shall be governed by the laws of the State of California without
reference to rules relating to conflict of law.
17. Counterparts. This Agreement
may be executed in any number of counterparts, each of which shall
be deemed an original but all of which together shall constitute
one and the same instrument.
IN
WITNESS WHEREOF, the undersigned have executed this Agreement as of
January 1, 2020:
/s/ ▇▇▇▇ ▇.
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Executive
Chairman
Date:
April 25, 2020
EXECUTIVE
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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Executive
Vice President
Chief
Operating Officer
Date:
April 25, 2020
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