EXHIBIT 10.2
EXECUTIVE EMPLOYMENT AGREEMENT
This EXECUTIVE
EMPLOYMENT AGREEMENT (this “ Agreement ”) is
made as of May 12, 2009, by and between Beacon Enterprise Solutions
Group, Inc., an Indiana corporation (the “ Company
”), and Bruce Widener (“ Executive ”).
This Agreement replaces the Executive Employment Agreement entered
into between the parties on December 20, 2007.
WHEREAS, the
Company desires to employ Executive, and Executive desires to be
employed by the Company, on the terms set forth herein;
NOW
THEREFORE, in consideration of the mutual covenants contained
herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
Section 1.
Employment . The Company hereby employs Executive, and
Executive hereby accepts employment with the Company, upon the
terms and conditions set forth in this Agreement, for the period of
thirty-six (36) months beginning on and effective as of May 12,
2009, and ending thirty-six (36) months thereafter, unless
Executive’s employment is extended as hereinafter provided or
is terminated as provided in Section 4 hereof (the “
Employment Period ”). Thereafter, this Agreement shall
be deemed extended from year to year upon the same terms and
conditions as set out herein, unless either party has notified the
other of their intent to terminate this Agreement within at least
one hundred twenty (120) days of the end of any then current
Employment Period, or unless this Agreement is terminated as
provide in paragraph 4 hereof.
Section 2.
Position and Duties . During the Employment Period,
Executive will serve as Chairman of the Board and Chief Executive
Officer of the Company and render such managerial, analytical,
administrative, marketing, creative and other executive services to
the Company and its Affiliates, as are consistent with such
executive position and from time to time necessary in connection
with the management and affairs of the Company and its Affiliates,
in each case subject to the authority of the Board (as defined
below) of the Company to define such executive services. Executive
will devote his best efforts and all of his business time and
attention (except for permitted vacation periods and reasonable
periods of illness or other incapacity) to the business and affairs
of the Company and its Affiliates. Executive will perform his
duties and responsibilities to the best of his abilities in a
diligent, trustworthy, businesslike and efficient manner. Executive
will be permitted to reside and perform Executive’s duties in
Louisville, Kentucky (other than typical travel that is required in
the performance of such duties).
Section 3.
Salary and Benefits .
(a)
Salary . Executive’s compensation shall consists of a
base annual salary of Two Hundred Forty Thousand ($240,000.00)
Dollars (less such deductions as shall be required to be withheld
pursuant to applicable law) and bonus as referred to in Section 3
(b) below. The Salary will be payable in regular installments
according to the Company’s payroll policies. Executive will
also be eligible for an annual salary review by the Company and the
Salary may
be increased by the Company based
on the achievement of performance goals, provided however ,
in any event, Executive shall be entitled to a minimum annual five
(5%) percent cost of living increase.
(b)
Bonuses . During the Employment Period, the Executive shall
be entitled to the following extended compensation bonuses in
addition to his base salary:
(i)
Short Term Incentive Compensation . Executive shall be
entitled to the following short-term incentive
compensation:
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(A)
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An amount equal
to fifty (50%) percent of the base salary at one hundred (100%)
percent achievement of Company EBITDA target pursuant to the
approved Corporate Bonus Pool attached hereto Exhibit
“A” .
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(B)
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An amount equal
to fifty (50%) percent of base salary based upon one hundred (100%)
percent achievement of positive EBITDA change (+Δ%) in
Company EBITDA target pursuant to the approved Corporate Bonus Pool
attached hereto as Exhibit “A”
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(ii) Long Term
Incentive Compensation .
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(A)
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1,000,000
ten-year stock options granted as of May 8, 2009 at the closing
price as of the date of the next compensation committee meeting,
based on the following goals:
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(1)
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Strategic
Planning
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*
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Corporate and
business planning completed by July 31 st of each
year
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*
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Operational
plan by September 30 th of each year including
budgets
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(2)
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Capitalization,
Public Filings, and Investor Relations
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*
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Ongoing
capitalization to ensure company meets financial
obligations
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Timely filing
of all information as required by the SEC and FINRA
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*
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Quarterly
earnings calls, annual meetings, and Board proceedings
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(3)
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Organizational
Development
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Executive team
and Board staffing
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2
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Performance and
compensation management system updated by September 30
th of each year
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The bonus program shall be
administered and distributed under the sole direction of the
Compensation Committee of the Board. The stock option shall be
vested over three (3) years, one-third (1/3) the first year,
one-third (1/3) the second year and one-third (1/3) the third year.
Except as provided in Section 4, if the Employment Period during
any fiscal year is less than the full fiscal year, the bonus amount
paid to Executive, if any, attributable to any fiscal year shall be
prorated for the actual number of days of the Employment Period
that elapse during such fiscal year.
(c)
Benefits . During the Employment Period, the Company will
provide Executive with family health, dental and major medical,
vision and disability coverage, as well as participation under such
plans as the Board may establish or maintain from time to time for
executive officers of the Company (collectively, the “
Benefits ”). Executive will be entitled to such paid
vacation per annum as the Company shall establish as Company policy
for all management of the Company.
(d)
Reimbursement of Expenses . During the Employment Period,
the Company will reimburse Executive for all reasonable
out-of-pocket expenses incurred by him during the Employment Period
in the course of performing his duties under this Agreement which
are consistent with the Company’s policies in effect from
time to time with respect to travel, entertainment and other
business expenses, subject to the Company’s requirements with
respect to reporting and documentation of such expenses.
Specifically, Executive will be reimbursed for up to $2,500 of
annual membership dues to licensing and trade organizations of the
Executive’s designation.
Section 4.
Termination .
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(a) The
Employment Period will continue until the earlier of:
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(i)
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Executive’s resignation
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(A) for Good
Reason on 30 days’ written notice,
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(B) expiration
of the Employment Term referred to in Section 1 hereof,
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(C) as a result
of Executive’s death or Disability, which resignation shall
be deemed automatically tendered upon Executive’s death or
Disability; or
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(ii)
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the giving of
notice of termination by the Company for Cause.
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For purposes of
this Agreement, “Cause” means
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(i)
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any material
willful or intentional act of Executive that has the effect of
injuring the reputation or business of the Company or its
Affiliates in any material respect,
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(ii)
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Executive’s use of illegal
drugs,
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(iii)
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that the
Executive has materially failed to perform his duties hereunder and
such failure continues uncured for 60 days after notice to
Executive by the Company; provided, the foregoing notice shall only
be required with respect to two material breaches that occur in any
12-month period, or
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(iv)
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Executive’s conviction or a plea of guilty
or no contest or similar plea with respect to, a felony, an act of
fraud or embezzlement, a breach of fiduciary duty to the Company or
any of its Subsidiaries, or
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(v)
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breach of any
of Sections 6, 7 or 8 of this Agreement.
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For the
purposes of this Agreement, “Good Reason”
means
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(i)
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any attempt to
substantially diminish Executive’s professional
responsibilities,
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(ii)
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any intentional
act which creates a workplace environment that, by duress or
otherwise, makes it impossible for Executive to continue his
employment,
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(iii)
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a reduction in
Salary or the overall level of other compensation and benefits to
which Executive is entitled under this Agreement, unless agreed to
by Executive, or
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(iv)
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the failure by
the Company to pay the Executive any portion of the
Executive’s current compensation when due and such failure
continues for 7 days after notice to Company from Executive
provided that the foregoing notice shall only be required with
respect to one such failure in any 12-month period.
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(v)
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A material
breach of this Agreement by Company and the failure to cure such
breach within thirty (30) days after notice to Company by the
Executive; provided , the foregoing notice shall only be
required with respect to one (1) material breach during the term or
any extended term of this Agreement.
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(vi)
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A change in
control of the Company.
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(b)
In the event the Employment Period is terminated by reason of
Executive’s death, disability or by the Company Without Cause
(which shall be a material breach of this Agreement) or the
Executive resigns for Good Reason, Executive shall be paid the
Severance Amount hereinafter referred to ( “Severance
Amount ”) in lump sum, within thirty
4
(30) days of the date of
termination, and simultaneously with the execution of a release in
the form of that which is attached hereto as Exhibit
“B” . The Severance Amount which Executive will be
entitled to is as follows:
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(i)
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The amount
equal to three (3x) times Executive’s then base annual salary
paid in cash or, if agreed to by Executive, a combination of cash
and unrestricted company stock, and
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(ii)
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One hundred
percent (100%) percent of all earned and fifty (50%) percent of all
unearned bonus incentive compensation for the remainder of the term
of this Agreement, but for such termination, and
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(iii)
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Any unearned
stock options or warrants shall immediately vest and be delivered
to executive in unrestricted form, and
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(iv)
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Immediate and
continued medical coverage during the Severance Term pursuant to
COBRA at the Company’s expense; and
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(v)
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all accrued and
unpaid Salary and unused vacation time through the Termination Date
and all unreimbursed business expenses incurred through the
Termination Date, and
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(vi)
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outplacement
services and office expense of up to Two Thousand ($2,000.00)
Dollars per month for a period of time equal to the greater of the
remainder of the term of this Agreement or a period of two (2)
years from the date of termination, whichever is greater, unless
such termination arises by reason of Executive’s
death.
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To the extent applicable,
Executive shall thereafter continue to comply with Section 6, 7 and
8 hereof.
(c)
In the event the Employment Period is terminated due to the
Executive’s resignation Without Good Reason or by the Company
with Cause then, so long as Executive continues to comply with
Sections 6, 7 and 8 hereof, Executive will be entitled to receive
the lump sum payment of the amounts referred to in (i) and (iii)
below within thirty (30) days of the date of termination, and
immediate and continued medical coverage referred to in (ii)
below:
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(i)
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any incentive
payments earned and accrued but not yet paid to Executive prior to
the Termination Date,
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(ii)
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continued
medical coverage during the Severance Term pursuant to COBRA at the
Company’s expense,
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(iii)
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all accrued and
unpaid Salary and unused vacation time through the Termination Date
and all unreimbursed busines
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