EMPLOYMENT AGREEMENT
Exhibit 10.6x1
EMPLOYMENT AGREEMENT (this
"Agreement"),
dated effective as of January 2, 2009 (the "Effective Date"), by
and between Universal Bioenergy Inc., a corporation organized and
existing under the laws of the Nevada whose principal office is located at 000
Xxxxxxxxx Xxxxx, Xxxxxxxxx, XX 00000 (the "Company"), and Xxxxx
Xxxxxxx Xxxx, an individual residing at 00 Xxxxx Xxxxx, Xxxx Xxxxx, XX 00000
(the "Executive").
WITNESSETH:
WHEREAS, the Company wishes to
employ the Executive upon the terms and subject to the conditions set forth
herein, and the Executive desires to enter into this Agreement and accept such
employment, upon such terms and conditions;
NOW, THEREFORE, in
consideration of the mutual covenants and promises contained herein, the parties
hereto, each intending to be legally bound hereby, agree as
follows:
1. Employment. The
Executive shall serve as the Company's Chief Financial Officer, Corporate
Treasurer, and member of the Board of Directors for the Company (the “Board”). The
Executive shall perform the usual and customary functions of a chief financial
officer and corporate treasurer in such capacity shall render such services as
are usual and customary with and incident to such positions, and other duties as
a Director of the Company may from time to time direct provided, however, that
such services are not materially inconsistent with the duties described
above.
2. Performance. During
the Employment Term, the Executive shall perform and discharge the duties that
may be assigned to him by the Board of Directors of the Company from time to
time in accordance with this Agreement, and the Executive shall devote his best
talents, efforts and abilities to the performance of his duties hereunder. The
Company will not preclude the Executive from exercising reasonable execution and
devotion of time to the Executive's personal and family investments as long as
those efforts do not unduly affect the performance of the Executive's duties to
the Company or said investment activities are not in direct competition with the
Company's field of interest as defined under Section 7(b) or otherwise in breach
of this Agreement.
3. Employment Term.
Unless earlier terminated pursuant to Section 5, the employment term shall
begin on January 2, 2009 (the "Effective Date"), and
shall continue for a period of one (1) year from such date (the "Initial Term");
provided that such term shall be automatically extended for additional periods
of one (1) year commencing on January 1, 2010 and each January 1st, thereafter
(such period the "Additional Term")
unless either party shall have given notice to the other party that such party
does not desire to extend the term of this Agreement. Any such notice must
comply with Section 10 and be given at least forty five (45) days prior to the
end of the Initial Term or the Additional Terms, as applicable (the Initial Term
and the Additional Term or Terms, if applicable, shall be known collectively as
the "Employment
Term"). Notwithstanding anything in this Agreement to the
contrary, the Employment Term shall end on the Termination Date as defined in
Section 5(g).
4. Compensation. As
compensation for services hereunder and in consideration of the Executive’s
other agreements hereunder, during the Employment Term, the Company shall pay
the Executive:
(a)
Base
Salary. A base salary, payable in accordance with the
customary payroll practices of the Company, subject to withholding and other
applicable taxes, at an annual rate of Sixty Thousand Dollars ($60,000) (the
"Base Salary")
to be payable by check, stock, or combination thereof with stock being issuable
quarterly.
(b) Signing Bonus. A
signing bonus of Restricted Stock equal to One Hundred Thousand Dollars
($100,000) to be calculated on the valuation of the Company’s common shares on
the Effective Date. Notwithstanding anything contained herein to the contrary,
the Restricted Stock granted herein shall be Restricted and vest on, and be
delivered to you promptly following, January 2, 2010 (the "Vesting Date");
provided that you have remained continuously employed by the Company until the
Vesting Date. In the event the Agreement is terminated prior to the Vesting Date
however, the Company shall grant the Executive a portion of the Restricted Stock
to be calculated on a pro-rated basis.
For
purposes of this Agreement, Restricted Stock shall mean, that the shares of the
Company, and the Executive’s interest therein, may not be sold, assigned,
transferred, pledged, hypothecated or otherwise disposed of, except by will or
the laws of descent and distribution, prior to the lapse of the applicable one
(1) year restrictions as set forth in the legend affixed to the Restricted Stock
certificates.
(c) Performance
Bonus. Executive will be
eligible to receive a quarterly performance bonus (the "Performance Bonus"),
to be determined by the Board of Directors and applicable Compensation
Committee, if one exists. The Company agrees to pay Executive any
Performance Bonus within thirty (30) days of the end of the Company’s fiscal
quarter in which such Performance Bonus was earned.
(d) Non-Cash
Consideration. For purposes of computing any fees payable to Executive
hereunder, non-cash consideration shall be valued as follows: (i) publicly
traded securities shall be valued at the average of their closing prices (as
reported in the Wall Street Journal) for the five trading days prior to the
closing of the Transaction and (ii) any other non-cash consideration shall be
valued at the fair market value thereof as determined in good faith by the
Company.
(e) Termination. The
employment hereunder of the Executive may be terminated prior to the expiration
of the Employment Term in the manner described in this Section 5.
(f) Termination by the Company
for Good Cause. The Company shall have the right to terminate
the employment of the Executive for Good Cause (as such term is defined in
Section 5(h)(ii)) by written notice to the Executive specifying the particulars
of the circumstances forming the basis for such Good Cause.
(g) Termination upon
Death. The employment of the Executive hereunder shall
terminate immediately upon his death.
(h) The Company's Options upon
Disability. If the Executive becomes physically or mentally
disabled during the Term so that he is unable to perform the services
required of him pursuant to this Agreement for a period of 180 successive days
or a cumulative 180 days in any twelve-month period (the "Disability Period"),
the Company shall have the option, in its discretion, by giving written notice
thereof, either to (A) terminate the Executive's employment hereunder pursuant
to Section 5(a); or (B) continue the employment of the Executive hereunder upon
all the terms and conditions set forth herein. During the Disability
Period the Executive shall continue to receive the compensation and other
benefits provided herein net of any payments received under any disability
policy or program of which the Executive is a beneficiary or
recipient.
(i) Voluntary Resignation by the
Executive. The Executive shall have the right to voluntarily
resign his employment hereunder for other than Good Reason (as such term is
defined in Section 5(h)(iv)) by written notice to the Company.
(j) Termination by the Company
Without Good Cause. The Company shall have the right to
terminate the Executive's employment hereunder without Good Cause by written
notice to the Executive, but the obligations placed upon the Company in Section
6 will apply.
(k) Resignation by the Executive
for Good Reason. The Executive shall have the right to
terminate his employment for Good Reason by written notice to the Company
specifying the particulars of the circumstances forming the basis for such Good
Reason.
(l) Termination
Date. The "Termination Date" is the date as of which the
Executive's employment with the Company terminates in accordance with this
Agreement. Any notice of termination given pursuant to the provisions
of this Agreement shall specify the Termination Date.
(m) Certain
Definitions. For purposes of this Agreement, the following
terms shall have the following meanings:
(i) "Person"
means any individual, corporation, partnership, association, joint-stock
company, trust, unincorporated organization, joint venture, court or government
(or political subdivision or agency thereof).
(ii) "Good
Cause" shall exist if the Executive: (i) willfully or repeatedly fails in any
material respect to satisfactorily perform his duties and obligations under this
Agreement, including without limitation the failure to comply substantially with
the reasonable instructions of the Board of Directors, which failure is not
cured within (fifteen (15) business days after written notice of such failure is
delivered by the Company; (ii) has been convicted of a crime or has entered a
plea of guilty or nolo contender with respect thereto; (iii) has committed any
act in connection with his employment with the Company which involves
fraud, gross negligence, misappropriation of funds, dishonesty, disloyalty,
breach of fiduciary duty or other misconduct injurious to the Company or any
other member of the Company Group; (iv) has engaged in any conduct which in the
reasonable determination of the Board is likely to adversely affect in any
material respect the reputation or public image of the Company or any other
member of the Company Group; or (v) breaches in any material respect this
Agreement which breach is not cured within fifteen (15) business days after
written notice of such failure is delivered by the Company; provided, however,
that during any twelve (12) month period, the Company shall only be required to
give notice three (3) times in the aggregate for any breaches of clauses (i) or
(v) above.
(iii) "Company
Group" shall mean the Company and any parent companies and subsidiaries and
other entities under common control.
(iv) "Good
Reason" means the occurrence of any of the following events:
(A) the
assignment to the Executive of any duties inconsistent in any material respect
with the Executive's then position (including status, offices, titles and
reporting relationships), authority, duties or responsibilities, or any other
action or actions by the Company which when taken as a whole results in a
significant diminution in the Executive's position, authority, duties or
responsibilities, excluding for this purpose any isolated, immaterial and
inadvertent action not taken in bad faith and which is remedied by the Company
promptly after receipt of notice thereof given by the
Executive; or
(B) a
material breach by the Company of one or more provisions of this Agreement,
provided that such Good Reason shall not exist unless the Executive shall first
have provided the Company with written notice specifying in reasonable detail
the factors constituting such material breach and such material breach shall not
have been cured by the Company within thirty (30) days after such notice or such
longer period as may reasonably be necessary to accomplish the cure but in any
event no longer than ninety (90) days;
5. Obligations of Company on
Termination. Notwithstanding anything in this Agreement to the
contrary, the Company's obligations on termination of the Executive's employment
shall be as described in this Section 6.
(a) Obligations of the Company
in the Case of Termination Without Good Cause or Resignation by the Executive
for Good Reason. In the event that prior to the expiration of
the Employment Term, the Company terminates the Executive's employment, pursuant
to Section 5(e), without Good Cause, or the Executive resigns, pursuant to
Section 5(f), for Good Reason, the Company shall provide the Executive with the
following:
(i) Amount of Severance
Payment. Except as provided in Section 6(b) below, within
thirty (30) days following the Termination Date, the Company shall pay the
Executive a single lump sum cash payment (the "Severance Payment")
equal to the sum of the following:
(A) the
equivalent of six (6) months Base Salary in the event the Termination Date is
after the first anniversary of the Effective Date (the "First Anniversary")
to increase by an amount equal to three months Base Salary for each year the
Executive is employed by the Company after the First Anniversary, up to an
amount not to exceed two (2) years Base Salary; and
(B) any
Base Salary, vacation and unreimbursed expenses accrued but unpaid as of the
Termination Date and any Performance Bonus applicable to the present fiscal
quarter.
(b) Obligations of the Company
in case of Termination for Death, Disability, Voluntary Resignation or Good
Cause. Upon termination of the Executive's employment upon
death (pursuant to Section 5(b)), or for Good Cause (pursuant to Section 5(a)),
the Company’s obligations to the Executive shall be limited to the payment of
any Base Salary, Performance Bonus for present fiscal quarter, and unreimbursed
expenses accrued but unpaid as of the date of such termination.
6. Covenants of the
Executive
(a) During
the Employment Term and for a period of two (2) years thereafter the Executive
shall not, directly or indirectly, employ, solicit for employment or otherwise
contract for the services of any employee of the Company or any of its
affiliates at the time of this Agreement or who shall subsequently become an
employee of the Company or any such affiliate; and
(b)
During the Employment Term and for a period of one (1) year thereafter the
Executive will not at any time engage in or participate as an executive officer,
employee, director, agent, consultant representative, stockholder, or partner,
or have any financial interest, in any business which "competes" with the
Company or successor to the business of the Company. For the purposes hereof, a
"competing" business shall mean any private or public entity in the biodiesel
field. Ownership by the Executive of publicly traded stock of any corporation
conducting any such business shall not be deemed a violation of the preceding
two sentences provided the Executive does not own more than five percent
(5% of the stock of any such corporation.
(c) Executive
agrees that all records, in whatever medium (including written works),
documents, papers, notebooks, drawings, designs, technical information, source
code, object code, processes, methods or other copyrightable or otherwise
protected works Executive conceives, creates, makes, invents, or discovers that
relate to or result from any work he performs or performed for the Company or
that arise from the use or assistance of the Company’s facilities, materials,
personnel, or Confidential Information in the course of his employment (whether
or not during usual working hours), whether conceived, created, discovered,
made, or invented individually or jointly with others, will be and remain the
absolute property of the Company, as will all the worldwide patent, copyright,
trade secret, or other intellectual property rights in all such
works. Executive irrevocably and unconditionally waives all rights,
wherever in the world enforceable, that vest in him (whether before, on, or
after the date of this Agreement) in connection with his authorship of any such
copyrightable works in the course of his employment with the
Company. Without limitation, Executive hereby waives the right to be
identified as the author of any such works and the right not to have any such
works subjected to derogatory treatment. Executive recognizes that
any such works are “works made for hire” of which the Company is the
author.
(d) All
files, records, correspondence, memoranda, notes or other documents (including,
without limitation, those in computer-readable form), real property or
intellectual property relating or belonging to the Company or its affiliates,
whether prepared by the Executive or otherwise coming into his possession in the
course of the performance of his services under this Agreement, shall be the
exclusive property of Company and shall be delivered to Company and not retained
by the Executive (including, without limitations, any copies thereof) upon
termination of this Agreement for any reason whatsoever.
(e) Executive
acknowledges that his employment with the Company under this Agreement, will
give him access to Confidential Information (as defined
below). Executive acknowledges and agrees that using, disclosing, or
publishing any Confidential Information in an unauthorized or improper manner
could cause the Company or its members to incur substantial loss and damages
that could not be readily calculated and for which no remedy at law would be
adequate. Accordingly, Executive agrees with the Company that he will
not at any time, except in performing his employment duties to the Company under
this Agreement (or with the Board of Directors of the Company’s, prior written
consent), directly or indirectly, use, disclose, or publish, or permit others
not so authorized to use, disclose, or publish any Confidential Information that
you may learn or become aware of, or may have learned or become aware of,
because of his continuing employment, ownership, or association with the
Company, or use any such information in a manner detrimental to the interests of
the Company or any of its shareholders. For the purposes of this
Agreement, "Confidential Information" includes, without limitation, confidential
or proprietary information that has not previously been disclosed to the public
or to the trade with respect to the Company’s or any of its affiliates present
or future business, including, without limitation, its operations, services,
products, research, clients, potential investors, inventions, discoveries,
drawings, designs, plans, processes, quantitative methodologies, models,
technical information, facilities, methods, trade secrets, copyrights, software,
source code, systems, patents, procedures, manuals, specifications, any other
intellectual property, confidential reports, customer lists, financial
information (including the revenues, costs, or profits associated with such
party’s products or services), business plans, projections,
prospects, opportunities or strategies, acquisitions or mergers, advertising or
promotions, personnel matters and legal matters, but excludes any information
already properly in the public domain. "Confidential Information"
also includes confidential and proprietary information and trade secrets that
third parties entrust to the Company in confidence.
(f) The
Executive acknowledges that a breach of his covenants contained in this Section
7 may cause irreparable damage to the Company and its affiliates, the exact
amount of which will be difficult to ascertain, and that the remedies at law for
any such breach will be inadequate. Accordingly, the Executive agrees
that if she breaches any of the covenants contained in this Section 7, in
addition to any other remedy which may be available at law or in equity, the
Company shall be entitled to specific performance and injunctive
relief.
(g) The
Company and the Executive further acknowledge that the time, scope, geographic
area and other provisions of this Section 7 have been specifically negotiated by
sophisticated commercial parties and agree that all such provisions are
reasonable under the circumstances of the activities contemplated by this
Agreement. In the event that the agreements in this Section 7 shall
be determined by any court of competent jurisdiction to be unenforceable by
reason of their extending for too great a period of time or over too great a
geographical area or by reason of their being too extensive in any other
respect, they shall be interpreted to extend only over the maximum period of
time for which they may be enforceable and/or over the maximum geographical area
as to which they may be enforceable and/or to the maximum extent in all other
respects as to which they may be enforceable, all as determined by such court in
such action.
(h) The
Executive agrees to cooperate with the Company, during the Employment Term and
thereafter (including following the Executive's termination of employment for
any reason), by making himself reasonably available to testify on behalf of the
Company or any of its affiliates in any action, suit, or proceeding, whether
civil, criminal, administrative, or investigative, and to assist the Company, or
any affiliate, in any such action, suit, or proceeding, by providing information
and meeting and consulting with the Board or its representatives or counsel, or
representatives or counsel to the Company, or any affiliate as reasonably
requested; provided, however that the same does not materially interfere with
his then current professional activities and is not contrary to the best
interests of the Executive. The Company agrees to reimburse the Executive, on an
after-tax basis, for all expenses actually incurred in connection with his
provision of testimony or assistance.
(i) The
parties agree that, during the Employment Term and thereafter (including
following the Executive's termination of employment for any reason) that they
will not make statements or representations, or otherwise communicate, directly
or indirectly, in writing, orally, or otherwise, or take any action which may,
directly or indirectly, disparage the other party or any of its affiliates or
their respective officers, directors, employees, advisors, businesses or
reputations. Notwithstanding the foregoing, nothing in this Agreement
shall preclude either party from making truthful statements or disclosures that
are required by applicable law, regulation or legal process.
7. Withholding. The
Company may withhold from the Executive's compensation all applicable amounts
required by law.
8. Arbitration. The
parties agree that any dispute, claim, or controversy based on common law,
equity, or any federal, state, or local statute, ordinance, or regulation (other
than workers’ compensation claims) arising out of or relating in any way to the
Executive’s employment, the terms, benefits, and conditions of employment, or
concerning this Agreement or its termination and any resulting termination of
employment, including whether such a dispute is arbitrable, shall be settled by
arbitration. This agreement to arbitrate includes but is not limited
to all claims for any form of illegal discrimination, improper or unfair
treatment or dismissal, and all tort claims. The Executive will still
have a right to file a discrimination charge with a federal or state agency, but
the final resolution of any discrimination claim will be submitted to
arbitration instead of a court or jury. The arbitration proceeding
will be conducted under the employment dispute resolution arbitration rules of
the American Arbitration Association in effect at the time a demand for
arbitration under the rules is made. The decision of the
arbitrator(s), including determination of the amount of any damages suffered,
will be exclusive, final, and binding on all parties, their heirs, executors,
administrators, successors and assigns. Each party will bear its own
expenses in the arbitration for arbitrators’ fees and attorneys’ fees, for its
witnesses, and for other expenses of presenting its case. Other
arbitration costs, including administrative fees and fees for records or
transcripts, will be borne equally by the parties.
9. Notices. Any
notices required or permitted hereunder shall be in writing and shall be deemed
to have been given when personally delivered or when mailed, certified or
registered mail, postage prepaid, to the following addresses:
If to the
Executive:
Xxxxx
Xxxxxxx Xxxx
00 Xxxxx
Xxxxx
Xxxx
Xxxxx, XX 00000
If to the
Company:
000
Xxxxxxxxx Xxxxx,
Xxxxxxxxx,
XX 00000
Attention:
CEO
10. General:
(a) Construction and
Severability. If any provision of this Agreement shall be held
invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions contained herein shall not in any
way be affected or impaired, and the parties undertake to implement all efforts
which are necessary, desirable and sufficient to amend, supplement or substitute
all and any such invalid, illegal or unenforceable provisions with enforceable
and valid provisions which would produce as nearly as may be possible the result
previously intended by the parties without renegotiation of any material terms
and conditions stipulated herein.
(b) Performance;
Assignability. The Executive represents and warrants to the
Company that the Executive has no contracts or agreements of any nature that the
Executive has entered into with any other person, firm or corporation that
contain any restraints on the Executive’s ability to perform his obligations
under this Agreement. The Executive may not
assign his interest in or delegate his duties under this
Agreement. This Agreement is for the employment of the Executive,
personally, and the services to be rendered by him under this Agreement must be
rendered by him and no other person. This Agreement shall be binding
upon and inure to the benefit of the Company and its successors and
assigns. Notwithstanding anything else in this Agreement to the
contrary, the Company may assign this Agreement to and all rights hereunder
shall inure to the benefit of any person, firm or corporation resulting from the
reorganization of the Company or succeeding to the business or assets of the
Company by purchase, merger or consolidation. 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 assume expressly 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 succession had taken place. The Company's failure to
obtain such an assumption and agreement prior to the effective date of a
succession will be a breach of this Agreement and will entitle the Executive to
compensation from the Company in the same amount and on the same terms as if the
Executive were to terminate his employment for Good Reason, except that, for
purposes of implementing the foregoing, the date on which any such succession
becomes effective will be deemed the Termination Date.
(c) Compliance with Rules and
Policies. The Executive shall perform all services in
accordance with the policies, procedures and rules established by the Company,
including, but not limited to, the By-Laws of the Company. In
addition, the Executive shall comply with all laws, rules and regulations that
are generally applicable to the Company, its affiliates and their employees,
directors and officers.
(d) Withholding. The
Company shall withhold from all amounts due hereunder any withholding taxes
payable to federal, state, local or foreign taxing authorities.
(e) Entire Agreement,
Modification. This Agreement constitutes the entire agreement
of the parties hereto with respect to the subject matter hereof, supersedes all
prior agreements and undertakings, both written and oral, and may not be
modified or amended in any way except in writing by the parties
hereto.
(f) Duration. Notwithstanding
the Employment Term hereunder, this Agreement shall continue for so long as any
obligations remain under this Agreement.
(g) Survival. The
covenants set forth in Section 7 of this Agreement shall survive and shall
continue to be binding upon the Executive notwithstanding the termination of
this Agreement for any reason whatsoever. It is expressly agreed that
the remedy at law for the breach or threatened breach of any such covenant is
inadequate and that the Company, in addition to any other remedies that may be
available to it, in law or in equity, shall be entitled to injunctive relief to
prevent the breach or any threatened breach thereof without bond or other
security or a showing that monetary damages will not provide an adequate
remedy.
(h) Waiver. No
waiver by either party hereto of any of the requirements imposed by this
Agreement on, or any breach of any condition or provision of this Agreement to
be performed by, the other party shall be deemed a waiver of a similar or
dissimilar requirement, provision or condition of this Agreement at the same or
any prior or subsequent time. Any such waiver shall be express and in
writing, and there shall be no waiver by conduct.
(i) Counterparts. This
Agreement may be executed in two or more counterparts, all of which taken
together shall constitute one instrument.
IN WITNESS WHEREOF, the
parties hereto, intending to be legally bound, have hereunto executed this
Agreement as of the day and year first written above.
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Date:
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24
February 2009
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/s/
Xxxxxxx X. Xxxxxx
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Name:
Xxxxxxx X. Xxxxxx
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Title:
President
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Date:
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25
February 2009
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Xxxxx
Xxxxxxx Xxxx
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/s/
Xxxxx Xxxxxxx
Xxxx
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