Exhibit 10.17
EMPLOYMENT AGREEMENT
THIS AGREEMENT
made as of the 1st day of January,
2009
BETWEEN:
US Geothermal Inc.
, a body corporate having an office
at 1505 Tyrell Lane Boise, Idaho 83706 (the " Company
")
AND:
Douglas J. Glaspey
of 1940 Teal Lane, Boise, Idaho
83706 (the " Employee ")
WHEREAS:
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(A)
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the Company is in the business of
developing geothermal properties;
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(B)
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the Company wishes to engage the
Employee as Chief Operating Officer and Executive Vice President;
and
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(C)
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the parties
hereto wish to enter into this Agreement for the purpose of fixing
the compensation and terms applicable to the employment of the
Employee during the period hereinafter set out.
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NOW
THEREFORE THIS AGREEMENT WITNESSES that the parties hereto, in consideration of the
respective covenants and agreements on the part of each of them
herein contained, do hereby covenant and agree as
follows:
1.
Employment
The
Company hereby engages the Employee as Chief Operating Officer and
Executive Vice President of the Company, and the Employee hereby
accepts such employment, upon the terms and conditions hereinafter
set out.
2.
Term
This
Agreement will be effective from January 1, 2009 and will remain in
full force and effect until the earlier of December 31, 2009 or
until terminated as hereinafter provided.
3.
Responsibility
The
Employee will devote one hundred percent of his working time to his
Employment hereunder, and while engaged in his employment will have
the authority and duty to perform and carry out such duties and
responsibilities as are customarily carried out by persons holding
similar positions in other development companies comparable in size
to the Company and such additional and related duties as may from
time to time be assigned, delegated, limited or determined by the
President.
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4.
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Other Business
Activities
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It is agreed that the Employee's
employment hereunder shall constitute one hundred percent of his
working time which shall be devoted exclusively for the benefit of
the Company, and therefore, the Employee may not engage in any
other business activities that would interfere with, or impede, in
any significant manner, the performance of his duties as Chief
Operating Officer of the Company.:
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5.
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Compensation
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In
consideration of the performance by the Employee of his
responsibilities and duties as Chief Operating Officer
hereunder:
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(a)
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the Company will pay the Employee
the sum of US$144,000 per annum, payable in monthly installments of
$12,000 no later than the last working day of the month;
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(b)
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the Company will grant the
Employee incentive stock options in such amount and on such
conditions as the Board of Directors of the Company may determine
from time to time;
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(c)
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the Company will provide the
Employee and his immediate family (consisting of spouse and
children) with medical, dental and related coverages as are
available to the other employees of the Company. The Company will
also provide reasonable life insurance and accidental death
coverage with the proceeds payable to the Employee’s estate
or specified family member; and
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(d)
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the Company will provide a 401K
retirement benefit as is available to the other employees of the
Company.
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6.
Expenses
The
Company will reimburse the Employee for any and all reasonable and
documented expenses actually and necessarily incurred by the
Employee in connection with the performance of his duties under
this Agreement. The Employee will furnish the Company with an
itemized account of his expenses in such form or forms as may
reasonably be required by the Company and at such times or
intervals as may be required by the Company, and reimbursement by
the Company will be made as soon as administratively practicable
thereafter but in no event later than three (3) months after the
date of termination.
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7.
Vacation
The
Employee will be entitled to a paid vacation of four weeks within
each 12 month period under the terms of this Agreement, to be
calculated from the date of commencement of employment set forth in
Section 2 herein. This vacation must be taken on dates which do not
adversely compromise the Employee’s performance of his duties
under this Agreement.
8.
Termination
This
Agreement and the Employee's employment may be terminated by the
Company summarily and without notice, payment in lieu of notice,
severance payments, benefits, damages or any sums whatsoever, on
the occurrence of any one or more of the following
events:
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(a)
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the Employee’s failure to
carry out his duties hereunder in a competent and professional
manner;
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(b)
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the Employee’s
appropriation of corporate opportunities for the Employee’s
direct or indirect benefit or his failure to disclose any material
conflict of interest;
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(c)
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the Employee’s plea of
guilty to, or conviction of, an indictable offence once all appeals
(if any) have been completed without such conviction having been
reversed;
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(d)
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the existence of cause for
termination of the Employee at common law including but not limited
to cause related to fraud, dishonesty, illegality, breach of
statute or regulation, or gross incompetence;
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(e)
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failure on the part of the
Employee to disclose material facts concerning his business
interests or employment outside of his employment by the Company,
provided such facts relate to the Employee’s duties
hereunder;
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(f)
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refusal on the part of the
Employee to follow the reasonable and lawful directions of the
Company;
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(g)
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breach of fiduciary duty to the
Company on the part of the Employee; or
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(h)
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material breach of this Agreement
or gross negligence on the part of the Employee in carrying out his
duties under this Agreement.
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8.1
In the event of the early termination of the
Agreement for any reason set out in Section 8 above, the Employee
shall only be entitled to such compensation as would otherwise be
payable to the Employee hereunder up to and including such date of
termination, as the case may be.
8.2
This Agreement and the Employee's employment may
be terminated on notice by the Company to the Employee for any
reason other than for the reasons set out in Section 8 above of
this Agreement upon one month notice to the Employee. In such
event, the Employee will be entitled to payment of salary up to and
including such date of termination and the pro-rata monetary
equivalent of any unused vacation days accrued to the date of
termination payable in accordance with usual payroll practices but
in no event later than three (3) months following the date of
termination. Expenses incurred up to and including such date of
termination shall be reimbursed only in accordance with Section
6.
8.3
This Agreement and the Employee's employment may
be terminated on notice by the Employee to the Company for any
reason upon one month notice to the Company. In such event, the
Employee will be entitled to payment of salary up to and including
such date of termination and the pro-rata monetary equivalent of
any unused vacation days accrued to the date of termination.
Expenses incurred up to and including such date of termination
shall be reimbursed only in accordance with Section 6.
8.4
In the event that (i) Employee’s
employment is terminated either by Company without Cause or by
Employee for Good Reason (as defined below), and (ii) a Change of
Control (as defined below) has occurred within the twelve (12)
month period preceding the date of such termination, the Employee
shall be entitled to receive a lump sum payment in an amount equal
to eighteen (18) monthly installments of the Employee’s base
annual salary as set forth under Section 5(a). Any payments made
under this Section 8.4, in all events, will be paid within 60 days
of the date of termination. For purposes of this Section 8.4, the
Employee shall be considered to have had a termination of
employment as of the date that the facts and circumstances indicate
that it is reasonably anticipated that the Employee will perform no
further services for the Company and its affiliates after such date
or that the level of bona fide services for the Company and its
affiliates that the Employee is expected to perform is expected to
decrease permanently to no more than 20% of the average level of
bona fide services that the Employee performed over the immediately
preceding 36-month period. Whether the Employee has had a
termination of employment will be determined in a manner consistent
with the definition of “separation from service” under
Code section 409A.
8.5
If this Agreement is terminated in accordance
with Section 8.4, the benefits provided to the Employee pursuant to
Section 5(c) of this Agreement shall continue for the number of
months of compensation the Employee is entitled to following the
termination of employment pursuant to Section 8.4 or until the
Employee commences alternative employment, whichever occurs first;
provided that, if such continued participation is not permissible
under applicable law, Company or its successor
