Exhibit 10.5
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Employment
Agreement
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September 14,
2009
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Agreement dated September 14, 2009
by and between Universal Holdings, Inc a Delaware Corporation, and
Jeffrey A Beunier (the “Executive”).
WHEREAS, the Company recognizes that
the Executive's talents and abilities are unique, and are integral
to the success of Universal Holdings, Inc and thus wishes to secure
the ongoing services of the Executive on the terms and conditions
set forth herein;
NOW, THEREFORE, in consideration of
the premises and the mutual covenants set forth below, the parties
hereby agree as follows:
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1.
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Employment:
The Company hereby agrees to employ
the Executive as the Chief Executive Officer of the Company, and
the Executive hereby accepts such employment, on the terms and
conditions set forth below.
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2.
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Start Date:
The Executive’s start date
will be on or around September 14, 2009.
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3.
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Compensation and Related
Matters:
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a.
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Base Salary. During the Employment
Period, the Company shall pay the Executive a base salary at the
rate of not less than $200,000 per year (“Base
Salary”). The Executive’s base Salary shall
be paid in approximately equal installments every two (2)
weeks. If the Executive’s Base Salary is increased
by the Company, such increased Base Salary shall then constitute
the Base Salary for all purposes of this agreement.
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b.
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Stock Compensation: Five Percent
(5%) of the current outstanding and authorized shares of Universal
Holdings Inc. The restricted stock grant will vest over a three
year period quarterly, vesting the trailing calendar quarter at its
end. There will be an initial vesting of 20% of the
stock grant upon execution of this agreement.
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c.
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Over Riding Royalty Interests: One
Percent (1%) overriding royalty interest (‘ORRI’) on
all acquired leases, wells, and properties (sourced by the
Executive and board approved) will be assigned to the Executive or
an entity chosen by the Executive upon the acquisition and/or
development of the leases, wells or properties. The
Company will assign the ORRI free and clear of any liens and
interests and the Company will no longer have any economic or legal
interests in the assigned ORRI (‘s).
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d.
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Co-Investment: The Executive or an
affiliate of the Executive will have an option to co-invest (with
Board Approval) in any and all of the company projects on a well by
well and lease by lease basis at cost. The election to
co-invest must be made within ninety (90) days upon the completion
of a well or acquisition of a lease, well, or property and will
date to the effective date of the completion of the well or
acquisition of a lease well or property. The Executive
will be limited in acquiring a maximum of ten (10%) of any
asset.
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e.
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Annual Bonus: For each full fiscal
year of the Company that begins and ends during the Employment
Period, and for the portion of the fiscal year of the Company that
begins in 2009 ("Fiscal Year 2009"), the Executive shall be
eligible to earn an annual cash bonus in such amount as shall be
determined by the Compensation Committee of the Board (the
"Compensation Committee") (the "Annual Bonus") based on the
achievement by the Company of performance goals established by the
Compensation Committee for each such fiscal year (or portion of
Fiscal Year 2009), which may include targets related to the
earnings before interest, taxes, depreciation and amortization
("EBITDA"), hydrocarbon production level, hydrocarbon reserve
amounts of the Company; provided, that the Annual Bonus shall be
targeted no less than $100,000 (with board approval). The
Compensation Committee shall establish objective criteria to be
used to determine the extent to which performance goals have been
satisfied.
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f.
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Vacation: The Executive shall be
entitled to four (4) weeks of vacation per year. Vacation not
taken during the applicable fiscal year (but not in excess of
three weeks) shall be carried over to the next following fiscal
year.
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g.
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Expenses: The Company will reimburse
the Executive for all expenses related to Company business,
including, but not limited to travel, marketing, communication, due
diligence, legal fees and expenses, etc.
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4.
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Dedication of Time/Conflict of
Interests: During the Employment Period, the
Executive shall serve as the Chief Executive Officer of the
Company, with such duties, authority and responsibilities as
are normally associated with and appropriate for such a position.
The Executive shall report directly to the Board.
The Company acknowledges the
Executive is not exclusively employed by the Company and the
Company acknowledges the Executive is currently active in a number
of activities related to the energy industry and will remain active
in activities not associated with the company. These
activities may or may not be in conflict with the best interests of
the Company. The Company specifically acknowledges the
Executive is permitted to continue allocating time to business
activities outside of the Company and waives any and all conflicts
of interest(s) that may or may not exist or develop in the
future.
The Executive acknowledges the
Company is dependent upon his knowledge and skill set and will
dedicate a minimum of ten (10) hours per week to the
Company’s business.
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5.
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Responsibilities: As the CEO of Universal Holdings, Inc, you will
be responsible for developing and implementing the Company’s
business plan, locate and review prospective acquisition targets,
negotiate any and all required contracts and agreements, oversee
the development plan of all acquired properties, execute any and
all documents required to implement the Company’s business
plan, and legally bind the Company to any agreement or
contract. As such, you will have the authority to reject
or modify any acquisition or development plan.
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6.
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At-Will
Employment: The
Executive’s employment with the Company would be on an
at-will basis. If terminated for any reason other than
Cause, the Company will be responsible to provide the Executive a
minimum of one 90 days Base Salary as severance payable
immediately upon termination as well as any business expenses
incurred but not yet reimbursed. Furthermore, the
Company will release any and all claims to any stock, ORRI or other
compensation provided through the date of termination or to which
the Executive is en
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