Exhibit
10.12
EXECUTIVE COMPENSATION
AND
RETENTION
AGREEMENT
(2009)
THIS EXECUTIVE COMPENSATION AND RETENTION
AGREEMENT (“Agreement”), by and between COIL TUBING
TECHNOLOGY HOLDINGS, INC., a Nevada corporation, (referred to
herein as the “Company”), and JERRY SWINFORD (referred
to herein as “Swinford”) (collectively “the
Parties”) is effective on the 1 st day of June, 2009 (the “Effective
Date”).
The Parties previously entered into an Executive
Compensation and Retention Agreement which was effective July 1,
2007. Thereafter on or around September 7, 2007 the
Parties entered into an Amended and Restated Executive Compensation
and Retention Agreement (collectively the “Prior
Agreement”). Swinford would be constructively
terminated under the terms of the Prior Agreement, if
Swinford’s duties change from President and Chief Executive
Officer to a lesser position. With an Effective Date of
June 1, 2009, the Company entered into an Executive Compensation
and Retention Agreement with Charles Wayne Tynon
(“Tynon” and “Tynon
Agreement”). Under the Tynon Agreement, Tynon was
named Chief Executive Officer of the Company. Swinford
has agreed to remain with the Company as its Chairman of the Board
and Vice President on terms similar to, but as modified herein, the
Prior Agreement. Accordingly, the Prior Agreement is
replaced and superseded in its entirety by this
Agreement.
In consideration of the mutual covenants set
forth herein, the Company and Swinford hereby agree as
follows:
1. APPOINTMENT. The
Company hereby agrees to appoint and retain Swinford as its
Chairman of the Board and Vice-President, and Swinford agrees to
serve the Company, in the capacities described herein during the
Period of Appointment (as defined in Section 2 of this Agreement),
in accordance with the terms and conditions of this
Agreement.
2. PERIOD
OF APPOINTMENT. The term “Period of Appointment” shall
mean the period which commences on the Effective Date and, unless
earlier terminated pursuant to Section 6, ends on December 31,
2011; provided, however, that the Period of Appointment may be
extended as provided herein. On January 1 of each year
that Swinford is employed by the Company, the period of appointment
will be extended for an additional year. Each
extension shall occur automatically unless Swinford provides the
Company in writing that he will not be exercising the extension by
December 1 of each year prior to the relevant January
1. For example, the Period of Appointment
will automatically extend to December 31, 2012 unless Swinford
provides notice that he will not be exercising the extension for
2012 on or before December 1, 2009. As a result, unless
Swinford provides notice otherwise, there will be at least two (2)
years remaining on the Period of Appointment at all
times.
3. DUTIES
DURING THE PERIOD OF APPOINTMENT.
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DUTIES. During
the Period of Appointment, Swinford shall be employed by the
Company and serve as its “Chairman of the Board and
Vice-President.” In such capacities, Swinford will
perform such services as are customary for a chairman of the board
and vice-president. Nothing herein is intended to
restrict the duties of Swinford or limit him from serving in such
other executive officer positions as the Board of Directors deems
appropriate.
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SCOPE. During
the Period of Appointment, and excluding any periods of vacation
and sick leave to which the office of Vice-President is entitled,
Swinford shall devote full time and attention to the affairs of the
Company.
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4. COMPENSATION
AND OTHER PAYMENTS.
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ANNUAL SALARY.
Annual salary shall be set at $132,000.00 per annum payable in
regular installments but in no event less often than
monthly.
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ANNUAL
INCREASES. Swinford’s annual salary will be
increased in an amount to be determined by the Board of the Company
or a Committee of the Board of the Company, but in no event shall
such increases be in an amount less than ten percent
(10%).
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BONUSES. Swinford may participate in
any and all bonus plans established by the Board or a Committee of
the Board.
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INCENTIVE
SHARES. At the end of each calendar year (December 31)
during the Period of Appointment and the end of each subsequent
year or, at Swinford’s option, within thirty (30) days
thereafter, the Company will issue to Swinford the number of shares
necessary to provide to Swinford five percent (5%) of the issued
and outstanding common stock of the Company (excluding any shares
of common stock issuable to other executives of the Company as a
result of incentive share clauses of such executives’
employment agreements). As a result, on December 31,
2009 and each year thereafter during the Period of Appointment,
subject to the termination provisions of Section 6 or, at
Swinford’s option, within 30 days thereafter, the Company
will issue Swinford shares of common stock equal to five percent
(5%) of the then total issued and outstanding common stock of the
Company (excluding any shares of common stock issuable to other
executives of the Company as a result of incentive share clauses of
such executives’ employment agreements). Such
shares will be subject to any and all restrictions appropriate or
necessary to comply with state or federal registration
requirements.
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REGULAR
REIMBURSED BUSINESS EXPENSES. The Company shall promptly reimburse
Swinford for all expenses and disbursements reasonably incurred by
Swinford in the performance of his duties hereunder during the
Period of Appointment.
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BENEFIT
PLANS. Swinford and his eligible family members shall be
entitled to participate immediately (except for any Company plan
which includes or requires a waiting period, in which event
Swinford shall be entitled to participate as soon as he is eligible
under the terms of such plan), on terms no less favorable to
Swinford than the terms offered to other employees, in any group
and/or executive life, hospitalization or disability insurance
plan, health program, vacation policy, pension, profit sharing,
ESOP, 401(k) and similar benefit plans (qualified, non-qualified
and supplemental) or other fringe benefits that may be offered by
the Company as approved by the Board of Directors from time to
time.
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HEALTH
INSURANCE. The Company shall provide Swinford and his
wife, whether or not he remains employed by the Company, health
insurance until the end of the Period of Appointment or he is
eligible for Medicare benefits, whichever is later.
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PERQUISITES.
The Company shall provide Swinford at least such perquisites as are
commonly provided to other executives of the Company and are
commiserate with his Appointment.
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GENERAL. Swinford’s employment
hereunder shall commence on the Effective Date and continue until
the end of the term specified in section 2 above, except that the
employment of Swinford hereunder shall terminate prior to such time
in accordance with the following:
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DEATH OR
DISABILITY. Upon Swinford’s death during the term
of his employment hereunder or, at the option of the Company, in
the event of Swinford’s disability, upon thirty (30) days
notice to Swinford.
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FOR
CAUSE. For “Cause” immediately upon written
notice by the Company to Swinford. A termination for
Cause shall mean:
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the commission
of an intentional act of dishonesty, fraud, misrepresentation,
misappropriation, or embezzlement by Swinford which has a material
detrimental impact on the Company;
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Swinford’s unauthorized use or disclosure
of any Confidential Information or trade secrets of the Company
which has a material detrimental impact on the Company;
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a significant
violation by Swinford of a law or regulation applicable to the
Company’s business, which has a material detrimental impact
on the Company and which the Board of the Company reasonably
determines does or is reasonably likely to cause material injury to
the Company;
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Swinford’s indictment of, or conviction
of, or plea of nolo contendere or guilty to a felony or any
other crime which involves moral turpitude;
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Swinford’s continued failure, in the
reasonable discretion of the Board, to perform the principal
duties, functions and responsibilities of his position (other than
any such failure resulting from Swinford’s disability) or to
follow the directives of the Board after written notice from the
Company identifying the deficiencies in performance and a
reasonable cure period of not less than thirty (30) days of any
breach capable of cure; gross negligence or willful misconduct in
the performance of Swinford’s duties; or
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a material and
willful breach of Swinford’s fiduciary duties to the
Company.
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WITHOUT
CAUSE. Without Cause upon thirty (30) days written
notice by the Board of Directors to Swinford or upon Swinford to
the Board of Directors. If Swinford terminates the
Agreement for any reason, he shall have no liability to the Company
or its subsidiaries or affiliates as a result thereof.
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CONSTRUCTIVE
TERMINATION. Upon Swinford’s Constructive
Termination. Constructive Termination of
Swinford’s employment with the Company will be deemed to have
occurred if Swinford terminates his employment with the Company
within six (6) months following the date on which:
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the Company
demotes Swinford to a lesser position, either in title or
responsibility;
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the Company
decreases Swinford’s pay below the highest level i
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