EMPLOYMENT AGREEMENT
THIS
EMPLOYMENT AGREEMENT ("Agreement") is made and
entered into as of the 5th day of
January, 2011 by and between BIOPOWER, a Nevada corporation (hereinafter called
the " Company "), and
Xxxx Xxxxxxxx (hereinafter called the "Executive").
RECITALS
WHEREAS, the Company is in the
business of establishing and growing multi-location biomass operations
throughout the world for the purpose of producing biomass feedstock for the
production of biomass energy products including electricity and biofuels;
and
WHEREAS, the Company desires
to begin the employ of the Executive as the President and Chief Operating
Officer of the Company, and the Executive is willing to accept such employment;
and
WHEREAS, the Executive has the
ability and experience to carry out the duties required of the President and
Chief Operating Officer of the Company; and
WHEREAS, as a condition
precedent to and as an incentive to the Company to employ the Executive as the
President of the Company, the Company and the Executive desire to record the
arrangements for such employment, in the manner provided for herein and upon the
terms and conditions set forth herein.
AGREEMENT
NOW, THEREFORE, in
consideration of the promises and mutual covenants herein contained, and other
good and valuable consideration, the sufficiency and receipt of which are hereby
acknowledged, the parties agree as follows:
1. Employment.
1.1
Employment and Term. The Company hereby
agrees to employ the Executive and the Executive hereby agrees to serve the
Company, on the terms and conditions set forth herein, for the period commencing
on February 1, 2011 and expiring on January 31, 2013 (the “Initial Term”) unless sooner
terminated as hereinafter set forth. This Agreement may be extended
for an additional two (2) year term (the “Renewal Term”) and
collectively with the Initial Term, the (“Term”) upon prior written
mutual agreement between the Company and the Executive of at least ninety (90)
days prior to the expiration of the Initial Term.
1.2
Duties of
Executive. The Executive shall serve as the President and Chief
Operating Officer of the Company and shall have powers and authority superior to
any other officer or employee of the Company other than the Chief Executive
Officer or of any subsidiary of the Company, including, without limitation, the
duties and responsibilities customarily associated with a chief operating
officer / president (e.g., control of day-to-day operations, signing checks,
hiring and firing, etc.). The Executive shall be required to report solely
to, and shall be subject solely to the supervision and direction of the Chief
Executive Officer and the Board of Directors and no other person or group shall
be given authority to supervise or direct Executive in the performance of
his duties. The Executive shall devote substantially all his working
time and attention to the business and affairs of the Company (excluding any
vacation and sick leave to which the Executive is entitled), render such
services to the best of his ability, and use his reasonable best efforts to
promote the interests of the Company. It shall not be a violation of
this Agreement for the Executive to (A) serve on corporate, civic or
charitable boards or committees, (B) deliver lectures, fulfill
speaking engagements or teach at educational institutions, and (C) manage
personal investments, so long as such activities do not interfere with the
performance of the Executive’s responsibilities as an employee of the Company in
accordance with this Agreement. The Executive's obligations hereunder shall run
to the Company and to the Company’s subsidiaries.
1.3
Place of Performance. In connection with his
employment by the Company, the Executive shall be based at the Company's
principal executive offices except for travel reasonably necessary in connection
with the Company's business.
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2. Compensation.
2.1(a)
Base Salary. Commencing on the effective date of this
Agreement, the Executive shall receive an annual base salary (the “ Base Salary ”) of US$150,000.
The Base Salary shall be payable in installments consistent with the Company's
normal payroll schedule, subject to applicable withholding and other
taxes.
2.1(b)
Any amount of Base Salary not paid pursuant to Section
2.1(a) shall accrue until paid in full and until such time that the Company
raises a minimum of $2,500,000.
2.2
Incentive Compensation. The Executive
shall be entitled to receive such bonus payments or incentive compensation as
may be determined at any time or from time to time by the Board of Directors of
the Company (or any authorized committee thereof) in its
discretion. Such potential bonus payments and/or incentive
compensation shall be considered at least annually by the Board or
committee.
2.3
Stock Options.
(a) The
Executive shall be entitled to participate in all stock option plans of the
Company (the “Plans”) in
effect during the Term of employment pursuant to this Agreement.
(b) All
Options issued to the Executive in accordance with this Agreement shall become
immediately exercisable as to 100% of the shares of Common Stock not otherwise
vested upon any termination of Executive’s employment pursuant to Sections 4.4
or 4.5 hereof, it being agreed that the Company shall vest the unvested portion
of the Executive’s Option shares and cooperate in good faith to afford the
Executive the right to accelerate the exercise of the Options in full
immediately prior to any Change in Control (as hereinafter
defined). In the event that Executive terminates or is
terminated pursuant to Sections 4.4 or 4.5 hereof, Executive shall have the
remaining term of the Options, in order to exercise his Options.
(c) Upon
proper exercise of an Option, the Executive shall be deemed for all purposes the
owner of the shares of Common Stock that are purchasable upon such
exercise.
(d) The
provisions of the Plan shall not be adversely modified as to the Executive
without the Executive’s prior written consent.
(e) All
Option shares shall be fully adjusted for events such as splits.
3. Expense
Reimbursement and Other Benefits.
3.1
Expense Reimbursement. During the
Term of Executive's employment hereunder, the Company, upon the submission of
reasonable supporting documentation by the Executive, shall reimburse the
Executive for all reasonable expenses actually paid or incurred by the Executive
in the course of and pursuant to the business of the Company, including expenses
for travel, lodging and entertainment in accordance with the Company’s
policies.
3.2
Incentive, Savings and Retirement
Plans. During the Term of Executive’s Employment hereunder, the
Executive shall be entitled to participate in all incentive, savings and
retirement plans, practices, policies and programs applicable to other key
executives of the Company and its subsidiaries, in each case comparable to those
currently in effect or as subsequently amended. Such plans,
practices, policies and programs, in the aggregate, shall provide the Executive
with compensation, benefits and reward opportunities at least as favorable as
the most favorable of such compensation, benefits and reward opportunities
provided at any time hereafter with respect to other key
executives.
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3.3
Welfare Benefit Plans. During the
Term of Executive’s Employment hereunder, the Executive, as the case may be,
shall be eligible for participation in and shall receive all benefits under
welfare benefit plans, practices, policies and programs provided by
the Company and its subsidiaries (including, without limitation, medical,
prescription, dental, disability, salary continuance, employee life, group life,
accidental death and travel accident insurance plans and programs), at least as
favorable as the most favorable of such plans, practices, policies and programs
in effect at any time hereafter with respect to other key
executives. Until such plans are in place Executive is entitled to
reimbursement for his medical insurance only.
3.4
Vacation. During the Term of
Executive’s Employment hereunder, the Executive shall be entitled to paid
vacation in accordance with the most favorable plans, policies, programs and
practices of the Company and its subsidiaries as in effect at any time hereafter
with respect to other key executives of the Company and its subsidiaries;
provided, however, that in no event shall Executive be entitled to fewer than
three weeks paid vacation per year, as well as pay for holidays observed by the
Company.
4. Termination.
4.1
Termination for Cause. Notwithstanding
anything contained to the contrary in this Agreement, this Agreement may be
terminated by the Company for Cause. As used in this Agreement,
“Cause” shall only
mean:
(a) an
act or acts of personal dishonesty taken by the Executive and intended to result
in substantial personal enrichment of the Executive or substantial damages to
the Company;
(b) subject
to the following sentences, a violation by the Executive of the Executive's
material obligations under this Agreement which are demonstrably willful,
persistent and deliberate on the Executive’s part and which are not remedied in
a reasonable period of time after receipt of written notice from the Company’s
Board of Directors; or
(c) the
conviction of the Executive for any criminal act which is a felony.
(d) any
and all acts that would be deemed as self-dealing that would be reasonably
considered as beneficial to the Company.
Upon any
reasonable and good faith determination by the Company's Board of Directors that
Cause exists under clause (a) of the preceding sentence and clause (b) of the
preceding sentence (to the extent the violation under said clause (b) has not
been cured by the Executive), the Company shall cause a special meeting of the
Board to be called and held at a time mutually convenient to the Board and
Executive, but in no event later than ten (10) business days after Executive's
receipt of the notice contemplated by clauses (a) and (b). Executive
shall have the right to appear before such special meeting of the Board
with his legal counsel at Executive’s expense to refute any determination of
Cause specified in such notice, and any termination of Executive's employment by
reason of such Cause determination shall not be effective until Executive is
afforded such opportunity to appear. Any termination for Cause
pursuant to clause (a) or (b) of the first sentence of this Section 4.1 shall be
made in writing to Executive, which notice shall set forth in detail all acts
or omissions upon which the Company is relying for such
termination. Upon any termination pursuant to this Section 4.1, the
Executive shall be entitled to be paid all of his Base Salary through the date
of the termination.
4.2
Disability. Notwithstanding anything
contained in this Agreement to the contrary, the Company, by written notice to
the Executive, shall at all times have the right to terminate this Agreement,
and the Executive's employment hereunder, if the Executive shall, as the
result of mental or physical incapacity, illness or disability, fail to
perform his duties and responsibilities provided for herein for a period of more
than sixty (60) consecutive days in any 12-month period. Upon any
termination pursuant to this Section 4.2, the Executive shall be entitled to be
paid his Base Salary for 6 months, unless there is a disability policy in
place. In addition, Executive shall be entitled to reimbursement for
all business expenses incurred prior to his disability.
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4.3
Death. In the event of the
death of the Executive during the Term of his employment hereunder, the Company
shall pay to the estate of the deceased Executive all salary due through the
date of death.
4.4
Optional Termination. Notwithstanding anything contained
in this Agreement to the contrary, the Executive, by giving thirty (30) days
prior written notice to the Company, shall two years after the date of this
Agreement, have the right to terminate this Agreement at his sole
discretion. Upon any termination pursuant to this Section 4.4, the
Executive shall be entitled to be paid all of his Base Salary due until
termination and any outstanding expenses and the Company shall have no further
liability hereunder thereafter (other than for reimbursement for reasonable
business expenses incurred prior to the date of termination and as to the
vesting of Options pursuant to Section 2.3(d)), unless the Executive and the
Company agree to a different arrangement.
4.5
Termination Without
Cause. At any time the Company shall have the right to terminate
Executive's employment hereunder by written notice to Executive; provided,
however, that the Company shall:
(a) pay
to Executive any all unpaid Base Salary and allow the Executive to enjoy all the
benefits given hereunder for the remaining period of this Employment Agreement,
including the Compensation package referred to in clause 2 hereof, and will
further allow to receive all pro-rata bonus, incentive and option shares that
would be payable had Executive completed the full term of
employment;
(b) pay
to the Executive in a lump sum, in cash or stock within 30 days after the date
of employment termination, an amount equal to the greater of (i) 100% of his
annual Base Salary then in effect, or (ii) the balance of the Executive’s Base
Salary from the effective date of termination through the expiration of the
Initial Term or Renewal Term then in effect as per clause 1 hereof payable as
per the normal salary payment schedule;
(c) continue
to pay the Executive’s health and disability insurance, and all other benefits
referred to in clause 3 hereof for the period of twelve (12) months or the
remainder of the period of the Agreement whichever is shorter; and
(d) The
Company shall be deemed to have terminated the Executive's employment pursuant
to this Section 4.5 if such employment is terminated by the Company without
Cause or as a result of a Change in Control.
(i) For
purposes of this Agreement, a “Change in Control” shall
mean:
1) The
acquisition (other than by or from the Company), at any time after the date
hereof, by any person, entity or “group,” within the meaning of Section 13(d)(3)
or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the " Exchange Act "), of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 50% or more of either the then outstanding shares of common
stock or the combined voting power of the Company's then outstanding voting
securities entitled to vote generally in the election of directors;
2) Approval
by the shareholders of the Company of (A) a reorganization, merger or
consolidation with respect to which persons who were the shareholders of the
Company immediately prior to such reorganization, merger or consolidation do
not, immediately thereafter, own more than 51% of the combined voting power
entitled to vote generally in the election of directors of the reorganized,
merged or consolidated company's then outstanding voting securities, (B) a
liquidation or dissolution of the Company, or (C) the sale of all or
substantially all of the assets of the Company, unless the approved
reorganization, merger, consolidation, liquidation, dissolution or sale is
subsequently abandoned; and
3) The
approval by the Board of the sale, distribution and/or other transfer or action
(and/or series of sales, distributions and/or other transfers or actions from
time to time or over a period of time), that results in the Company's ownership
of less than 50% of the Company's current assets.
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5.
Restrictive Covenants.
5.1
Nondisclosure. During his employment and for twelve
(12) months thereafter, Executive shall not divulge, communicate, use to the
detriment of the Company or for the benefit of any other person or persons, or
misuse in any way, any Confidential Information (as hereinafter defined)
pertaining to the business of the Company, unless required to do so by a
governmental agency or court of law. Any
Confidential Information or data now or hereafter acquired by the Executive
with respect to the business of the Company shall be deemed a valuable, special
and unique asset of the Company that is received by the Executive in confidence
and as a fiduciary, and Executive shall remain a fiduciary to the Company with
respect to all of such information. For purposes of this Agreement,
"Confidential
Information" means all material information about the Company's business
disclosed to the Executive or known by the Executive as a consequence of or
through his employment by the Company (including information conceived,
originated, discovered or developed by the Executive) after the date hereof, and
not generally
known.
5.2
Non-solicitation of Employees. While
employed by the Company and for a period of twelve (12) months thereafter,
Executive shall not directly or indirectly, for himself or for any other person,
firm, corporation, partnership, association or other entity, attempt to employ
or enter into any contractual arrangement with any employee or former
employee of the Company.
5.3
Covenant Not to Compete. Executive will not, at any
time, during the Term of this Agreement, and for a period of twelve (12) months
thereafter, either directly or indirectly, engage in, with or for any
enterprise, institution, whether or not for profit, business, or company,
competitive with the business (as identified herein) of the Company as such
business may be conducted on the date thereof, as a creditor, guarantor, or
financial backer, stockholder, director, officer, consultant, advisor, employee,
member, or otherwise of or through any corporation, partnership, association,
sole proprietorship or other entity; provided, that an investment by Executive,
his spouse or his children is permitted if such investment is not more than four
percent (4%) of the total debt or equity capital of any such competitive
enterprise or business. As used in this Agreement, the business of
Employer shall be deemed to include any business which directly competes with
the Company.
5.4
Injunction. It is recognized and
hereby acknowledged by the parties hereto that a breach by the Executive of any
of the covenants contained in Sections 5.1, 5.2 or 5.3 of this Agreement
will cause irreparable harm and damage to the Company, the monetary amount of
which may be virtually impossible to ascertain. As a result, the
Executive recognizes and hereby acknowledges that the Company shall be entitled
to an injunction from any court of competent jurisdiction enjoining and
restraining any violation of any or all of the covenants contained in this
Section 5 by the Executive or any of his affiliates, associates, partners
or agents, either directly or indirectly, and that such right to injunction
shall be cumulative and in addition to whatever other remedies the Company may
possess.
6. Re-negotiate.
This contract may be re-negotiated by the Executive should the circumstances and
the economic situation of the Company change beyond the Company’s
forecast.
7. Entire
Agreement. This instrument contains the entire agreement of the
parties, and supersedes any prior or contemporaneous statements or
understandings by or between the parties. This Agreement may be
changed only by an agreement in writing signed by the party against whom
enforcement of any waiver, change, modification, extension or discharge is
sought, and any such modification on behalf of the Company must be approved by
the Board.
8. Governing
Law/Jurisdiction. This Agreement shall be governed by and construed
in accordance with the laws of the State of Florida, excluding choice of
law provisions.
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The
parties hereby irrevocably and unconditionally agree to submit any legal action
or proceeding relating to this Agreement to the non-exclusive general
jurisdiction of the courts of the State of Florida located in Broward County and
the courts of the United States located in Florida and, in any such action or
proceeding, consent to jurisdiction in such courts and waive any objection
to the venue in any such court. Executive agrees that service of process upon
Executive in any such action or proceeding may be made by United States mail,
certified or registered, return receipt requested, postage
prepaid. Unless otherwise agreed, the prevailing party in any
litigation relating to the interpretation or enforcement of this Agreement shall
be entitled to reasonable costs and attorneys' fees.
9. Notices: Any
notice required or permitted to be given under this Agreement shall be in
writing and shall be deemed to have been given (a) when delivered by hand, (b)
when deposited in the United States mail, by registered or certified mail,
return receipt requested, postage prepaid, or via overnight courier, (c) one day
after electronically mailed either in the text of an email message or attached
in a commonly readable format, and the sender has received no generated notice
that the email message has not been successfully delivered, or (d) upon receipt
of proof of sending thereof when sent by facsimile, addressed as
follows:
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If
to the Company:
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Attention:
Board of Directors
BioPower
Operations Corporation
0000
Xxxxx Xx. Xxxxx 000
Xxxxxxx
Xxxxx, Xxxxxxx 00000
Email:
xxxxx@xxxxxxxxxxxx.xxx
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with
a copy to:
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Xxxxxxx
Savage LLP
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Attention: Xxxxx
X. Xxxxxxx, Esq.
Fax: 000-000-0000
Email:
xxxxxxxx@xxxxx.xxx
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If
to the Executive:
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Attention:
Xxxx Xxxxxxxx
0000
Xxxxx Xx. Xxxxx 000
Xxxxxxx
Xxxxx, Xxxxxxx 00000
xxxxxxxx@xxxxxxx.xxx
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or to
such other addresses as either party hereto may from time to time give notice of
to the other in the aforesaid manner.
10.
Successors.
(a) This
Agreement is personal to the Executive and without the prior written consent of
the Company shall not be assignable by the Executive otherwise than by will or
the laws of descent and distribution. This Agreement shall inure to
the benefit of and be enforceable by the Executive's legal
representatives.
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(b) This
Agreement shall inure to the benefit of and be binding upon the Company and its
successors and assigns.
(c)
The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. As used in this Agreement, “Company” shall mean the
Company as hereinbefore defined and any successor to its business and/or assets
which assumes and agrees to perform this Agreement by operation of law or
otherwise.
11.
Severability. The
invalidity of any one or more of the words, phrases, sentences, clauses or
sections contained in this Agreement shall not affect the enforceability of the
remaining portions of this Agreement or any part thereof, all of which are
inserted conditionally on their being valid in law, and, in the event that any
one or more of the words, phrases, sentences, clauses or sections contained in
this Agreement shall be declared invalid, this Agreement shall be construed as
if such invalid word or words, phrase or phrases, sentence or sentences, clause
or clauses, or section or sections had not been inserted. If such
invalidity is caused by length of time or size of area, or both, the otherwise
invalid provision will be considered to be reduced to a period or area which
would cure such invalidity.
12.
Waivers. The waiver by either party
hereto of a breach or violation of any term or provision of this Agreement shall
not operate nor be construed as a waiver of any subsequent breach or
violation.
13.
Damages. Nothing contained herein shall be
construed to prevent the Company or the Executive from seeking and recovering
from the other damages sustained by either or both of them as a result of its or
his breach of any term or provision of this Agreement.
14.
No Third Party Beneficiary. Nothing expressed
or implied in this Agreement is intended, or shall be construed, to confer upon
or give any person (other than the parties hereto and, in the case of Executive,
his heirs, personal representative(s) and/or legal representative) any rights or
remedies under or by reason of this Agreement.
15.
Counterparts. This Agreement may
be executed in counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
16.
Executive’s Recognition of Agreement. Executive
acknowledges that Executive has read and understood this Agreement, and agrees
that its terms are necessary for the reasonable and proper protection of the
Company’s business. Executive acknowledges that Executive has been
advised by the Company that Executive is entitled to have this Agreement
reviewed by an attorney of Executive’s selection, at Executive’s expense, prior
to signing, and that Executive has either done so or elected to forgo that
right.
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IN WITNESS WHEREOF, the
undersigned have executed this Agreement as of the date first above
written.
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COMPANY:
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|
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By:/s/ Xxxxxx
X. Xxxx
Xxxxxx
X. Xxxx, Chief Executive Officer
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EXECUTIVE:
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By:/s/ Xxxx
Xxxxxxxx
Xxxx
Xxxxxxxx
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