Exhibit 10.6
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT (this “Agreement”) is entered into as of the 2nd day of February, 2022 (the “Effective Date”), by and between Global Clean Energy Holdings, Inc. (“GCEH” or “Company”), and Ralph John Goehring (hereinafter, “Employee,” and collectively with the Company, the “Parties”).
WITNESSETH:
WHEREAS, the Company and Employee wish to enter into an Employment Agreement between the Parties (this “Agreement”); and
NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth, the Parties hereto agree as follows:
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EMPLOYMENT; TERM; DUTIES
1.1 |
Employment. Pursuant to the terms and conditions hereinafter set forth, the Company wishes to employ Employee for the position of Senior Vice President, Chief Financial Officer of the Company. |
1.2 |
Term. The initial term of Employee’s employment with Company under this Agreement shall be three (3) years from the effective date (the “Effective Date”), Company shall not terminate Employee’s employment for any reason other than those stated in paragraph 3.1 herein. Any failure of Company to comply with the express terms of this agreement shall constitute a material breach and Employee shall be entitled to all remedies provided in law or equity. The initial term provided for herein shall not be extended except by a writing executed both by Company and by Employee. |
1.3 |
Duties and Responsibilities. Employee shall report to the Chief Executive Officer of the Company (the “CEO”). Employee shall perform such managerial and executive duties and oversight for the Company (and its subsidiaries) and such other managerial and executive duties, tasks and responsibilities as are customarily vested in and incidental to Employee’s position in companies similar to the Company. |
1.4 |
Exclusive Employment. Employee shall devote all of Employee’s business time, attention, skill, and best efforts to the performance of Employee’s duties under this Agreement and shall not engage in any other business, board membership or occupation without the prior written consent of the Board (which shall not be unreasonably withheld), including, without limitation, any activity that (x) conflicts with the interests of the Company, (y) interferes with the proper and efficient performance of Employee’s duties for the Company, or (z) interferes with Employee’s exercise of judgment in the Company’s best interests. Notwithstanding the foregoing, nothing in this Agreement shall prevent Employee from engaging in activities for Employee’s personal investments, residing on boards of other companies, religious, charitable, community or non-for-profit activities that do not conflict or interfere with his ability to fulfill his duties and responsibilities to the Company. |
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1.5 |
Indemnification and Insurance. The Company agrees to indemnify, and advance any costs and expenses to, the Employee for all of his activities under this Agreement, including any costs of defense incurred in connection with the foregoing. A separate indemnity agreement will be executed to fulfil this requirement. |
1.6 |
Company shall insure Employee under a customary and suitable director and officer liability insurance policy(s) for Employee’s services rendered to the Company (and its subsidiaries) while Employee is a director or officer of the Company (or such subsidiaries). |
1.7 |
Covenants of Employee |
1.7.1 |
Best Efforts. Employee shall perform his duties, responsibilities and functions to the Company hereunder to the best of his abilities in a diligent, trustworthy, professional and efficient manner and shall comply, in all material respects, with all rules, regulations of the Company (and special instructions of the CEO, if any) and all other rules, regulations, guides, handbooks, procedures and policies applicable to the Company and its business in connection with his duties hereunder; provided, however, nothing in this Agreement shall be construed to require Employee to violate any applicable law, rule and regulation or judicial or arbital order. |
1.7.2 |
Records. Employee shall truthfully, accurately, and promptly prepare, maintain, and preserve all records and reports that the Company may, from time to time, request or require, fully account for all money, records, equipment, materials, or other property belonging to the Company of which he may have custody, and promptly pay and deliver the same whenever he may be directed to do so, in writing, by the CEO. |
1.7.3 |
Code of Conduct. For such period as when Employee is employed hereunder, Employee shall at all times conduct himself with the highest ethical standards, and shall at all times adhere to the Company’s Code of Conduct attached hereto as Exhibit A, as amended from time to time by the Company. |
1.7.4 |
Opportunities. The Employee shall make available to the Company and present to the Board all business opportunities of which he becomes aware, which are relevant to the business of the Company (and its subsidiaries), and to no other person or entity or to himself individually. |
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COMPENSATION AND OTHER BENEFITS
2.1.1 |
Base Salary. From the Start Date until no later than the 12 month anniversary thereof, for all services rendered by Employee hereunder and all covenants and conditions undertaken by the Parties pursuant to this Agreement, the Company shall pay, and Employee shall accept, as compensation, an annual base salary (“Base Salary”) of $325,000.00. Thereafter the Base Salary shall be increased in accordance with the Company’s compensation plans applicable to the Company’s senior executives. The Base Salary shall be payable in regular installments in accordance with the normal payroll practices of the Company, in effect from time to time, but in any event no less frequently than on a monthly basis. |
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2.1.2 Bonus Compensation.
2.1.2.1 |
Annual Cash Bonus. Employee will be eligible to earn an annual cash bonus (the “Bonus”) based on the Company and Employee’s achievement of certain bonus objectives (Objectives”) established by the Company subject to the approval of the Compensation Committee of the Board (“Compensation Committee”). It shall be the joint obligation of the Employee and the Compensation Committee to develop and agree to written achievable Objectives within the first forty-five (45) days of the applicable bonus year (or the Start Date, as applicable). Any annual Bonus to be awarded, if any, will be determined by the Compensation Committee and based upon achievement of the written Objectives. The target amount of the Bonus for any given employment year shall be fifty percent (50%) of the Base Salary in effect for the applicable year. Notwithstanding anything herein to the contrary, the Parties hereby acknowledge and agree that the Compensation Committee shall, in accordance with NASDAQ rules and regulations for publicly traded companies, comprise independent directors of the Board only. The amount of the annual Bonus, if any, shall be determined by the Compensation Committee, based upon a pre-established formula based upon Employee’s achievement of the Objectives. In order to be eligible to receive the full amount of any annual Bonus, Employee must be employed by the Company on the last day of the year in which the annual Bonus is earned. The annual Bonus, if any, shall be paid in the calendar year following the calendar year for which the annual bonus is due, but in any event no later than March 15 of such year. Any compensation owed but not paid under this Agreement shall accrue interest at the maximum extent permitted by applicable law. |
2.1.2.2 |
Equity Incentive Option upon Signing. Concurrently with the execution of this Agreement, the Company shall grant Employee an option (the “Equity Incentive Option”) to purchase fifty thousand (50,000) shares of the Company’s common stock at an exercise price which will established based upon the market closing price of GCEH on the last business day before the Effective Date. The Equity Incentive Option shall vest in equal installments on the first day of each of the next 12 quarters, and will expire five (5) years after the date of grant; provided, however that the Equity Incentive Option shall accelerate and immediately vest to Employee as a result of any event of change of control of the Company (defined by greater than fifty percent of outstanding shares or substantially all assets acquired by one or more affiliated/related entities) and (ii) if this Agreement is terminated for any reason other than for Cause (as defined below). |
2.1.2.3 |
Annual Equity Bonus. Employee shall participate in any annual stock plans of Company to the same extent and on such terms and conditions as the Company customarily makes such plans available to its senior executives. |
2.1.3 |
Business Expenses. The Company shall reimburse Employee for all reasonable, out-of-pocket business expenses incurred in the performance of his duties hereunder consistent with the Company’s policies and procedures, in effect from time to time, with respect to travel, entertainment and other business expenses customarily reimbursed to senior executives of the Company in connection with the performance of their duties on behalf of the Company. Such reimbursement shall be made by Company to Employee no later than fifteen (15) days after submission of written expense reports by Employee to Company. |
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2.1.4 |
Other Benefits. During Employee’s employment with the Company, Employee shall be entitled to the following benefits: |
2.1.4.1.1 |
Employee shall be entitled to participate in the Company’s employee stock option plan, life, health, accident, disability insurance plans, pension plans and retirement plans, in effect from time to time, to the extent and on such terms and conditions as the Company customarily makes such plans available to its senior executives; and |
2.1.4.1.2 |
Employee shall be entitled to receive coverage for services rendered to the Company (and its subsidiaries if and when directed by the Board) while Employee is a director or officer of the Company under any director and officer liability insurance policy(s) maintained by the Company from time to time; and |
2.1.4.1.3 |
Company shall pay for, or on behalf of Employee, or reimburse the Employee, at Employee’s sole election, the full cost of Employee’s and Employee’s family health insurance plan in accordance with the Company’s policies and procedures applicable to its senior executives. Nothing contained herein shall be construed to limit the Company’s ability to amend, suspend, or terminate any employee benefit plan or policy at any time to the extent permissible by law, and the right to do so is expressly reserved. |
2.1.4.1.4 |
Vacation. Employee shall be entitled to four (4) weeks of vacation time each full calendar year with full pay. Vacation will accrue monthly to Employees account. Any unused vacation leave as of December 31st of the calendar year will be carried into the following year in accordance with the Company’s policies and procedures applicable to its senior executives. |
2.1.4.1.5 |
Withholding. The Company may deduct from any compensation payable to Employee (including payments made pursuant to this Article II or in connection with the termination of employment pursuant to Article III of this Agreement) amounts sufficient to cover Employee’s share of applicable federal, state and/or local income tax withholding, social security payments, state disability and other insurance premiums and payments. |
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TERMINATION OF EMPLOYMENT
3.1 |
Termination of Employment. Employee’s employment pursuant to this Agreement shall terminate on the earliest to occur of the following: |
3.1.1 upon the death of Employee; or
3.1.2 |
upon the delivery to Employee of written notice of termination by the Company if Employee shall suffer a physical or mental disability which renders Employee, in the reasonable judgment of the Board, unable to perform his duties and obligations under this Agreement for either 90 consecutive days or 180 days in any 12-month period; or |
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3.1.3 upon delivery to Employee of written notice of termination by the Company for Cause; or
3.1.4 |
upon delivery of written notice from the Employee to the Company for Good Reason. |
3.2 |
Certain Definitions. For purposes of this Agreement, the following terms shall have the following meanings: |
3.2.1 |
In connection with Paragraph 3.1 herein, “Cause” shall mean any of the following: |
3.2.1.1 |
Employee materially breaches any obligation, duty, or covenant under this Agreement, which breach is not cured or corrected within thirty (30) days of receipt by Employee of written notice thereof from the Company (except for breaches of Article IV of this Agreement, which cannot be cured and for which the Company need not give any opportunity to cure); or |
3.2.1.2 |
Employee commits any act of misappropriation or embezzlement of funds of the Company; or |
3.2.1.3 |
Employee commits any act of fraud in the performance of his duties for the Company; or |
3.2.1.4 |
Employee is convicted of or pleads guilty or nolo contendere to any charge of theft, fraud, or a crime involving moral turpitude. |
3.2.2 |
In connection with Paragraph 3.1 herein, “Good Reason” shall mean: (a) without Employee’s consent, the Company changes Employee’s position or duties to such an extent that his duties are no longer consistent with the positions of Senior Vice President, Chief Financial Officer of the Company, or (b) Company materially breaches any term of this Agreement; provided that, in each case, “Good Reason” shall not exist unless Employee first provides the Company with written notice of the acts or omissions constituting the grounds for “Good Reason” within ninety (90) days of the initial existence of the grounds for “Good Reason” and such acts or omissions are not cured within thirty (30) days following the Company’s receipt of such notice. |
3.2.3 |
“Termination Date” shall mean the date on which Employee’s employment with the Company hereunder is terminated. |
3.3 |
Effect of Termination |
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3.3.1 |
If Employee’s employment is terminated for Good Reason, in addition to Company’s payment of all outstanding sums due and owing to Employee at the time of separation, the Company shall pay Employee an amount equal to three (3) months of Employee’s then-current Base Salary in the form of salary continuation (the “Severance Payments”), plus payment (or reimbursement, as the case may be) of Employee’s and Employee’s family medical insurance premium for a period of 18 months. At such time when Employee’s employment with the Company is terminated, and as a condition to Employee’s right to receive any benefits pursuant to this Section 3.3.1, shall be conditioned upon Employee’s execution, delivery to the Company, and non-revocation of the Release of Claims (and the expiration of any revocation period contained in such Release of Claims) within sixty (60) days following the date of Employee’s separation from service hereunder. The Release of Claims shall specifically exclude all unpaid wages (and bonus payments) due and owing to Employee as of the date of separation. If Employee fails to execute the Release of Claims in such a timely manner so as to permit any revocation period to expire prior to the end of such sixty (60) day period, or timely revokes Employee’s acceptance of such release following its execution, Employee shall not be entitled to any of the Severance Payments. Further, to the extent that any of the Severance Payments constitutes “nonqualified deferred compensation” for purposes of Section 409A of the Code, any payment of any amount or provision of any benefit otherwise scheduled to occur prior to the sixtieth (60th) day following the date of Employee’s separation from service hereunder, but for the condition on executing the Release of Claims as set forth herein, shall not be made until the first regularly scheduled payroll date following such sixtieth (60th) day, after which any remaining Severance Payments shall thereafter be provided to Employee according to the applicable schedule set forth herein. In the event Employee executes a Release of Claims pursuant to this paragraph and, thereafter, Company fails to pay any sum due and owing to Employee under this paragraph 3.3.1, then the Employee shall have the right, but not the obligation to convert outstanding sums due to Employee to GCEH Corporate stock at the then market price of the stock. |
3.3.2 |
Notwithstanding the reason for termination of Employee’s employment, Employee shall be entitled to: |
3.3.2.1 |
all benefits payable under applicable benefit plans in which Employee is entitled to participate pursuant to Section 2.5 hereof through the Termination Date, subject to and in accordance with the terms of such plans; and |
3.3.2.2 |
any accrued but unused vacation earned by Employee through the Termination Date pursuant to Section 2.6 hereof, paid out in accordance with legal requirements; and |
3.3.2.3 |
reimbursement for any business expenses incurred by Employee prior to Termination Date in accordance with Section 2.4 of this Agreement. |
3.3.3 |
If Employee’s employment is terminated for death or disability, Employee or Employee’s estate shall be entitled to all severance benefits (including, without limitation, the Severance Payments) under this Agreement as well as retaining any options vested as of the date of termination. |
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INVENTIONS; CONFIDENTIAL/TRADE SECRET INFORMATION AND RESTRICTIVE
COVENANTS
4.1 |
Inventions. All processes, technologies and inventions relating to the business of the Company (and its subsidiaries) (collectively, “Inventions”), including new contributions, improvements, ideas, discoveries, trademarks and trade names, conceived, developed, invented, made or found by the Employee, alone or with others, during his employment by the Company, whether or not patentable and whether or not conceived, developed, invented, made or found on the Company’s time or with the use of the Company’s facilities or materials, shall be the property of the Company and shall be promptly and fully disclosed by Employee to the Company. The Employee shall perform all necessary acts (including, without limitation, executing and delivering any confirmatory assignments, documents or instruments requested by the Company) to assign or otherwise to vest title to any such Inventions in the Company and to enable the Company, at its sole expense, to secure and maintain domestic and/or foreign patents or any other rights for such Inventions. |
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4.2 |
Confidential/Trade Secret Information/Non-Disclosure. |
4.2.1 |
Confidential/Trade Secret Information Defined. During the course of Employee’s employment, Employee will have access to various Confidential/Trade Secret Information of the Company and information developed for the Company. For purposes of this Agreement, the term “Confidential/Trade Secret Information” is information that is not generally known to the public and, as a result, is of economic benefit to the Company in the conduct of its business, and the business of the Company’s subsidiaries. Employee and the Company agree that the term “Confidential/Trade Secret Information” includes but is not limited to all information developed or obtained by the Company, including its affiliates, and predecessors, and comprising the following items, whether or not such items have been reduced to tangible form (e.g., physical writing, computer hard drive, disk, tape, etc.): all methods, techniques, processes, ideas, research and development, product designs, engineering designs, plans, models, production plans, business plans, add-on features, trade names, service marks, slogans, forms, pricing structures, menus, business forms, marketing programs and plans, layouts and designs, financial structures, operational methods and tactics, cost information, the identity of and/or contractual arrangements with suppliers and/or vendors, accounting procedures, and any document, record or other information of the Company relating to the above. Confidential/Trade Secret Information includes not only information directly belonging to the Company which existed before the date of this Agreement, but also information developed by Employee for the Company, including its subsidiaries, affiliates and predecessors, during the term of Employee’s employment with the Company. Confidential/Trade Secret Information does not include any information which (a) was in the lawful and unrestricted possession of Employee prior to its disclosure to Employee by the Company, its subsidiaries, affiliates or predecessors, (b) is or becomes generally available to the public by lawful acts other than those of Employee after receiving it, or (c) has been received lawfully and in good faith by Employee from a third party who is not and has never been an executive of the Company, its subsidiaries, affiliates or predecessors, and who did not derive it from the Company, its subsidiaries, affiliates or predecessors. |
4.2.2 |
Restriction on Use of Confidential/Trade Secret Information. Employee agrees that his/her use of Confidential/Trade Secret Information is subject to the following restrictions during this Agreement and for two years following the expiration or termination of this Agreement so long as the Confidential/Trade Secret Information has not become generally known to the public: |
4.2.2.1 |
Non-Disclosure. Employee agrees that he will not publish or disclose, or allow to be published or disclosed, Confidential/Trade Secret Information to any person without the prior written authorization of the Company unless pursuant to or in connection with Employee’s job duties to the Company under this Agreement. |
4.2.2.2 |
Non-Removal/Surrender. Employee agrees that he will not remove any Confidential/Trade Secret Information from the offices of the Company or the premises of any facility in which the Company is performing services, except pursuant to his duties under this Agreement. Employee further agrees that he shall surrender to the Company all documents and materials in his possession or control which contain Confidential/Trade Secret Information and which are the property of the Company upon the termination of this Agreement, and that he shall not thereafter retain any copies of any such materials. |
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4.2.3 |
Prohibition Against Unfair Competition/ Non-Solicitation of Customers. Employee agrees that for a period of two years after his employment with the Company will he engage in competition with the Company while making any use of the Confidential/Trade Secret Information, or otherwise exploit or make use of the Confidential/Trade Secret Information. |
4.3 |
Non-Solicitation of Employees. Employee agrees that during the twelve month period following the Termination Date, he shall not, directly or indirectly, solicit, directly or indirectly, or otherwise encourage any employees of the Company to leave the employ of the Company, or solicit, directly or indirectly, any of the Company’s employees for employment. |
4.4 |
Conflict of Interest. During Employee’s employment with the Company, Employee must not engage in any work, paid or unpaid, that creates an actual conflict of interest with the Company. |
4.5 |
Breach of Provisions. If Employee breaches any of the provisions of this Article IV, or in the event that any such breach is threatened by Employee, in addition to and without limiting or waiving any other remedies available to the Company at law or in equity, the Company shall be entitled to immediate injunctive relief in any court, domestic or foreign, having the capacity to grant such relief, to restrain any such breach or threatened breach and to enforce the provisions of this Article IV. |
4.6 |
Reasonable Restrictions. The Parties acknowledge that the foregoing restrictions, as well as the duration and the territorial scope thereof as set forth in this Article IV, are under all of the circumstances reasonable and necessary for the protection of the Company and its business. |
4.7 |
Special Definition. For purposes of this Article IV, the term “Company” shall be deemed to include any subsidiary of the Company. |
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