Exhibit 10.11
EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT
AGREEMENT (the
“Agreement”) is entered into effective as of
June 19, 2000, by and between Geo Petro Resources Company, a
California corporation located at One Maritime Plaza, Suite 400,
San Francisco, California 94111, together with its successors and
assigns permitted under this Agreement (hereinafter the
“Company”) and J. Chris Steinhauser, an individual and
resident of the State of California (hereinafter
“Employee”) located at 26 Moonlight, Irvine, California
92612.
WHEREAS , Employee desires to become employed by the
Company on a full-time basis as its Chief Financial Officer and
Vice President of Finance; and
WHEREAS , the Company and Employee desire to enter into
an agreement to provide for Employee’s employment by the
Company, upon the terms and conditions set forth herein:
NOW, THEREFORE
, in consideration of the mutual
covenants herein contained and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:
1. Employment. The
Company agrees to employ Employee, and Employee accepts such
employment and agrees to perform his duties and responsibilities in
accordance with the terms and conditions hereinafter set
forth.
1.1 Employment
Term. The terms of Employee’s employment under this
Agreement shall commence as of June 19, 2000 (the
“Effective Date”) and shall continue until two
(2) years after the Effective Date (the “Termination
Date”), unless earlier terminated in accordance with
Section 3 hereafter. The period commencing as of the Effective
Date and ending on the Termination Date is hereinafter referred to
as the “Employment Term”.
1.2 Duties and
Responsibilities. During the Employment Term, Employee
shall serve as Chief Financial Officer of the Company or shall
serve in such other capacity as appointed by the President of the
Company (the “President”), and shall report to the
President. During the Employment Term, Employee agrees to perform
all employment duties and responsibilities that shall be assigned
and required by the President or such other duties and
responsibilities in such other capacity as the President shall
assign to him from time to time.
1.3 Outside
Activities. During his employment, Employee shall devote
his full energies, interest, abilities, and productive time to the
performance of this Agreement and shall not, without the
Company’s prior written consent, render to others services of
any kind for compensation, or engage in any other activity (with or
without compensation) that would interfere with the performance of
his duties under this Agreement.
1.4 Covenant Not to
Compete. During the Employment Term, Employee shall not,
directly or indirectly, whether as a partner, employee, creditor,
shareholder (other than as a shareholder owning less than five
percent (5%) of a publicly traded company), or otherwise, promote,
participate, or engage in any activity or other business that
directly competes with the Company’s business.
1.5 Base
Salary. For all the services rendered by Employee
hereunder, the Company shall pay Employee a base salary (the
“Base Salary”) at the annual rate of $108,000.
Employee’s Base Salary shall be payable in installments at
such times as the Company customarily pays its other
employees.
1.6 Bonus. At
the Effective Date, Employee shall receive a cash bonus of $10,000.
Employee shall receive an additional $10,000 bonus upon the
successful completion of the first merger between the Company and
another entity, and an additional $10,000 bonus upon the
effectiveness of the Company’s registration statement under
the Securities Exchange Act of 1934 or the Securities Act of 1933.
Employee also may be eligible to receive a discretionary bonus each
year during the Employment Term (“Annual Bonus”),
which, if
any, shall be earned based on
criteria established by the President from time to time and shall
be paid in the sole discretion of the President either in cash or
equity in the Company. Employee’s Annual Bonus, if any, shall
be paid to him in accordance with the Company’s generally
payroll practices with regard to bonuses of such type.
1.7 Warrant
Compensation. Upon execution of this Agreement, the Company
shall issue 250,000 warrants, subject to vesting requirements as
set forth, to Employee entitling Employee to purchase non-callable
no par voting common stock of the Company. Each warrant shall
entitle the holder thereof to purchase one share of common stock as
follows:
|
Term
|
|
Exercise
Price
per Share
|
|
# of Shares
Underlying
Warrants
|
|
Vesting*
|
|
|
5 years
|
|
$
|
2.00
|
|
30,000
|
|
Immediately
|
|
|
5 years
|
|
$
|
2.00
|
|
30,000
|
|
One Year
|
|
|
5 years
|
|
$
|
2.00
|
|
30,000
|
|
Two Years
|
|
|
5 years
|
|
$
|
2.00
|
|
30,000
|
|
Three Years
|
|
|
5 years
|
|
$
|
2.00
|
|
30,000
|
|
Four Years
|
|
|
|
|
|
|
150,000
|
|
|
|
|
Term
|
|
Exercise
Price
per Share
|
|
# of Shares
Underlying
Warrants
|
|
Vesting*
|
|
|
5 years
|
|
$
|
3.00
|
|
6,666
|
|
Immediately
|
|
|
5 years
|
|
$
|
3.00
|
|
6,666
|
|
One Year
|
|
|
5 years
|
|
$
|
3.00
|
|
6,666
|
|
Two Years
|
|
|
5 years
|
|
$
|
3.00
|
|
6,666
|
|
Three Years
|
|
|
5 years
|
|
$
|
3.00
|
|
6,669
|
|
Four Years
|
|
|
|
|
|
|
33,333
|
|
|
|
|
Term
|
|
Exercise
Price
per Share
|
|
# of Shares
Underlying
Warrants
|
|
Vesting*
|
|
|
5 years
|
|
$
|
4.00
|
|
6,666
|
|
Immediately
|
|
|
5 years
|
|
$
|
4.00
|
|
6,666
|
|
One Year
|
|
|
5 years
|
|
$
|
4.00
|
|
6,666
|
|
Two Years
|
|
|
5 years
|
|
$
|
4.00
|
|
6,666
|
|
Three Years
|
|
|
5 years
|
|
$
|
4.00
|
|
6,669
|
|
Four Years
|
|
|
|
|
|
|
33,333
|
|
|
|
*
Length of time after the effective date.
|
Term
|
|
Exercise
Price
per Share
|
|
# of Shares
Underlying
Warrants
|
|
Vesting*
|
|
|
5 years
|
|
$
|
5.00
|
|
5,555
|
|
Immediately
|
|
|
5 years
|
|
$
|
5.00
|
|
5,555
|
|
One Year
|
|
|
5 years
|
|
$
|
5.00
|
|
5,555
|
|
Two Years
|
|
|
5 years
|
|
$
|
5.00
|
|
5,555
|
|
Three Years
|
|
|
5 years
|
|
$
|
5.00
|
|
5,559
|
|
Four Years
|
|
|
|
|
|
|
33,334
|
|
|
|
|
TOTAL WARRANTS
|
|
|
|
250,000
|
|
|
|
*
Length of time after the effective date.
Subject to the vesting provisions
above, the warrants may be exercised from the Effective Date until
11:59 p.m. (San Francisco time) on the date that is five years
after the date of this Agreement. Each warrant not exercised on or
before the expiration date shall expire. The no par voting common
shares issued pursuant to the warrant exercises shall be identical
in all respects to the currently outstanding no par common of the
Company. The Company shall include the shares of common stock
reserved for issuance under the above-described warrants in any
registration statement it files during the Employment Term, subject
to any limitations imposed by an underwriter on the amount of such
shares that can be included in such registration, and Employee
shall be subject to all lock-ups (restricting his resale rights)
imposed by the underwriter on the Company’s other management
shareholders.
Employee shall also be entitled to
participate annually in any incentive stock option plan
(“Plan”) adopted by the Company and in effect during
the year(s) Employee is employed by the Company. Compensation
received as a result of participation in a Plan adopted by the
Company shall be referred to as the “Incentive
Compensation.” Incentive Compensation shall be determined at
the sole discretion of the President.
1.8 Benefit
Coverages. During the Employment Term, Employee shall be
entitled to participate in all employee pension and welfare
(medical and dental) benefit plans and programs made available to
the Company’s employees generally, as such plans or programs
may be in effect from time to time (the “Benefit
Coverages”). Employee shall be entitled to three weeks paid
vacation per year. In addition, Employee shall be entitled to
holidays and sick days in accordance with the Company’s
policies and procedures.
2. Indemnification;
Insurance. The Company shall indemnify Employee to the
fullest extent permitted under the Company’s Articles of
Incorporation and Bylaws and allowed under applicable law. Employee
shall be covered by the Company’s officer and director
liability insurance policy in effect at the time of any claim. The
Company agrees to maintain an officer and director liability
insurance policy in effect during the term of this Agreement which
provides an aggregate limit of at least $3,000,000 and a deductible
of not more than $100,000.
3. Termination. The
Employment Term shall terminate upon the occurrence of any one of
the following events:
3.1 Disability.
The Employment Term shall terminate if: (1) Employee is unable
to perform the essential functions of his job including any of his
duties and responsibilities by reason of illness, injury or
incapacity for three (3) consecutive months, or for more than
six (6) months in the aggregate during any period of eighteen
(18) calendar months; and (2) the Company is unable to
reasonably accommodate the Employee’s disability. Employee
agrees, in the event of a dispute concerning any disability, to
submit to a physical examination by a licensed physician and/or
other professional evaluator(s) selected by the Company. If the
Employment Term is terminated as a result of disability, Employee
shall be entitled to the continued right to exercise any stock
warrants granted to Employee hereunder which have vested as of the
date of termination, but all unvested warrants shall be terminated
and canceled. For avoidance of doubt, Employee acknowledges that he
shall not be entitled to receive any Base Salary or portion of an
Annual Bonus while he
is unable to perform his job duties
(other than accrued sick leave and vacation) during such period of
time prior to a determination of whether or not Employee is
disabled.
3.2 Death. The
Employment Term shall terminate upon Employee’s death. In
such event, the Company shall pay to Employee’s executors,
legal representatives, or administrators, as applicable, an amount
equal to the installment of Employee’s Base Salary through
the date of Employee’s d
