Exhibit 10.1

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is entered into effective the 9th
day of April 2012 (the “Effective Date”) by and between Robert C. Henry, a
resident of the State of Minnesota (“Employee”), and Dakota Plains Holdings,
Inc., a Nevada corporation (the “Company”).

 

WHEREAS, the Company’ primary business is developing, owning and operating rail
facilities and other means to support the loading, marketing and transporting of
crude oil and related products from and into the North Dakota Bakken oil fields;

 

WHEREAS, during his employment with the Company, Employee will have access to
the Company’s confidential, proprietary and trade secret information. Employee
and the Company agree that it is in the best interests of the Company to protect
its confidential, proprietary and trade secret information, to prevent unfair
competition by former executives following separation of their employment and to
secure cooperation from former executives with respect to matters related to
their employment with the Company; and

 

WHEREAS, Employee acknowledges that his receipt of benefits under this Agreement
depends on, among other things, his agreement to abide by the confidentiality,
non-competition, non-solicitation and other covenants contained in this
Agreement in Sections 5 and 6 below.

 

NOW, THEREFORE, in consideration of the foregoing recitals and the respective
agreements of the Company and Employee as set forth below, the Company and
Employee, intending to be legally bound, agree as follows:

 

1.            Employment.

 

1.1            Term. As of the Effective Date, the Company hereby employs
Employee, and Employee hereby accepts such employment on the terms and
conditions set forth herein, for the period commencing on the Effective Date and
ending on the two year anniversary of the Effective Date, unless sooner
terminated pursuant hereto (the “Initial Term”). The Company and Employee shall
provide one another with written notice ninety (90) days prior to the second
anniversary of the Effective Date (April 9, 2014), and on subsequent yearly
anniversaries of April 9, 2014, of their intention to terminate this Agreement
or to extend the Agreement under the terms and conditions hereof for successive,
additional one (1) year periods, subject to early termination pursuant hereto
(each a “Renewal Term”). The Agreement will be extended only if both the Company
and Employee agree to extend the Agreement. The Initial Term together with any
Renewal Term(s) is herein referred to as the “Term.” If Employee remains
employed by the Company after the Term, then such employment shall be according
to such terms and conditions as the Company may establish from time to time.

 

1.2            Services. The Company hereby agrees to employ Employee in the
role of the Company’s Vice President of Operations, and Employee hereby accepts
such employment with the Company on the terms and conditions set forth herein.
Employee shall perform all activities and services as the Company’s Vice
President of Operations, which shall include such duties and responsibilities as
the Company’s Board of Directors (the “Board”) and Chief Executive Officer may
from time-to-time reasonably prescribe consistent with the duties and
responsibilities of the Vice President of Operations of the Company (the
“Services”). Employee shall use his best efforts to make himself available to
render such Services to the best of his abilities. The Services shall be
performed in a good professional and workmanlike manner by Employee, to the
Company’s reasonable satisfaction, which shall include duties and
responsibilities as the Company’s Vice President of Operations. Employee shall
be considered an executive officer for purposes of Section 16 of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”).

 

2.            At-Will Relationship. Employee’s employment with the Company shall
be entirely “at-will,” meaning that either Employee or the Company may terminate
such employment relationship at any time for any reason or for no reason at all,
subject to the provisions of this Agreement.

 

 

 

 

3.            Compensation and Restricted Stock Award. In consideration for
Employee entering into this Agreement with the Company and performing the
Services required hereunder during the Term, the Company shall provide Employee
with the following compensation while Employee is employed by the Company during
the Term:

 

3.1            Annual Salary. The Company shall pay Employee an annualized base
salary according to this Section 3.1 (the “Salary”), which Salary shall be paid
monthly on the 15th day of each calendar month, or the last business day
immediately preceding the 15th day of each calendar month, in the event the 15th
falls on a weekend or a holiday. Employee’s initial annualized Salary as of the
Effective Date shall be $150,000.

 

3.2            Annual Bonus. For each calendar year during the Term Employee
shall be eligible to receive an annual incentive bonus in the discretion of the
Company’s Compensation Committee or Board based upon Employee meeting or
exceeding mutually agreed upon performance goals, with a target annual incentive
bonus equal to 20% of Employee’s annualized Salary and to be paid in fully
vested shares of the Company’s common stock to be issued no later than March 15
of the calendar year immediately following the calendar year for which such
bonus is earned; provided, however, that nothing herein shall obligate the
Company to pay any bonus to Employee at any time

 

3.3            Restricted Stock Award. Employee shall received a restricted
stock award of 15,000 shares of the Company’s common stock in accordance with
the terms and conditions of the Company’s 2011 Equity Incentive Plan and that
certain Restricted Stock Agreement between the Company and Employee dated the
same date as Employee executes this Agreement (the “Restricted Stock
Agreement”).

 

4.            Benefits. In consideration for Employee entering into this
Agreement with the Company and performing the Services required hereunder during
the Term, the Company shall provide Employee with the following employee
benefits while Employee is employed by the Company during the Term:

 

4.1            Retirement Plans. Employee shall be entitled to participate in
the Company’s 401(k), profit sharing and other retirement plans (the “Plan”)
presently in effect or hereafter adopted by the Company, to the extent that such
Plan relates generally to all employees of the Company. Employee shall be able
to contribute up to the legal limit, as a percentage of his annualized Salary,
into any such Plan, of which the Company shall match Employee’s contribution up
to a maximum of eight percent (8.0%) of Employee’s annualized Salary.

 

4.2            Vacation. Employee shall be entitled to vacation pursuant to such
general policies and procedures of the Company consistent with past practices as
are from time to time adopted by the Company.

 

4.3            Expense Reimbursement. Employee shall be reimbursed by the
Company for all ordinary and customary business expenses, including travel and
other disbursements pre-approved by the Company’s Chief Executive Officer.
Employee shall provide such appropriate documentation regarding such expenses
and disbursements as Company may reasonably require. Reimbursement shall occur
once per month and must be paid no later than the end of the Company’s taxable
year following the taxable year in which such expenses are incurred.

 

4.4            Health Insurance. Employee, Employee’s spouse and any children of
Employee (the “Employee’s Family”) shall be entitled to participate in health,
hospitalization, disability, dental and other such health-related benefits
and/or insurance plans that the Company may have in effect from time-to-time and
provided the Employee and Employee’s Family meets the eligibility requirements
for each such individual plan or program, all of which insurance premiums shall
be paid by the Company on behalf of Employee and Employee’s Family. The Company
provides no assurance as to the adoption or continuance of any particular
health, hospitalization, disability, dental and other such health-related
benefits and/or insurance plans or programs and Employee and Employee’s Family’s
participation in any such plan or program shall be subject to the provisions,
rules and regulations applicable thereto.

 

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4.5            Other Benefits. Employee shall also be entitled to such other
benefits as the Company may from time-to-time generally provide to its
personnel, at the discretion of and as permitted by the Company’s management.

 

5.            Confidential Information.

 

5.1            Employee shall maintain the confidentiality of all trade secrets,
(whether owned or licensed by the Company) and related or other interpretative
materials and analyses of the Company’s projects, or knowledge of the existence
of any material, information, analyses, projects, proposed joint ventures,
mergers, acquisitions, divestitures and other such anticipated or contemplated
business ventures of the Company, and other confidential or proprietary
information of the Company (“Confidential Information and Materials”) obtained
by Employee as result of Employee’s employment with the Company and for two (2)
years following termination of Employee’s employment with the Company for any
reason, whether such termination is at the initiative of Employee or the Company
or before or after expiration of the Term.

 

5.2            In the event that such Confidential Information and Materials are
memorialized on any computer hardware, software, CD-ROM, disk, tape, or other
media, Company shall have the right, subject to the rights of third parties
under contract, copyright, or other law, to view, use, and copy for safekeeping
or backup purposes such Confidential Information and Materials. During the
period of confidentiality, Employee shall make no use of such Confidential
Information and Materials for his own financial or other benefit, and shall not
retain any originals or copies, or reveal or disclose any Confidential
Information and Materials to any third parties, except as otherwise expressly
agreed by the Company. Employee shall have no right to use the Company’s
corporate logos, trademarks, service marks, or other intellectual property
without prior written permission of the Company and subject to any limitations
or restrictions upon such use as the Company may require.

 

5.3            Upon expiration or termination of this Agreement, Employee shall
turn over to a designated representative of the Company all property in
Employee’s possession and custody and belonging to the Company. Employee shall
not retain any copies or reproductions of correspondence, memoranda, reports,
notebooks, drawings, photographs or other documents relating in any way to the
affairs of the Company and containing Confidential Information and Materials
which came into Employee’s possession at any time during the term of Employee’s
employment with the Company.

 

5.4            Employee acknowledges that the Company is a public company
subject to the reporting requirements of the Exchange Act and that this
Agreement may be subject to the filing requirements of the Exchange Act.
Employee acknowledges and agrees that the applicable insider trading rules and
limitations on disclosure of non-public information set forth in the Exchange
Act and rules and regulations promulgated by the SEC shall apply to this
Agreement and Employee’s employment with the Company. Employee (on behalf of
himself as well as his executors, heirs, administrators and assigns) absolutely
and unconditionally agrees to indemnify and hold harmless the Company and all of
its past, present and future affiliates, executors, heirs, administrators,
shareholders, employees, officers, directors, attorneys, accountants, agents,
representatives, predecessors, successors and assigns from any and all claims,
debts, demands, accounts, judgments, causes of action, equitable relief,
damages, costs, charges, complaints, obligations, controversies, actions, suits,
proceedings, expenses, responsibilities and liabilities of every kind and
character whatsoever (including, but not limited to, reasonable attorneys’ fees
and costs) in the event of Employee’s breach or alleged breach of any obligation
under the Exchange Act, any rules promulgated by the SEC and any other
applicable Federal or state laws, rules, regulations or orders.

 

5.5            The foregoing obligations of confidentiality shall not apply to
any Confidential Information and Materials that: (i) are now or subsequently
become generally publicly known, other than as a direct or indirect result of
the breach by Employee of this Agreement, (ii) are independently made available
to Employee in good faith by a third party who has not violated a confidential
relationship with the Company, or (iii) are required to be disclosed by law or
legal process. Employee understands and agrees that Employee’s obligations under
this Agreement to maintain the confidentiality of the Company’s Confidential
Information are in addition to any obligations of Employee under applicable
statutory or common law. The parties agree that the provisions of this Section 5
shall survive any termination of Employee’s employment with the Company and this
Agreement.

 

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6.            Non-Competition and Non-Solicitation.

 

6.1            Employee agrees that he will not:

 

(i)            anywhere within the United States, engage, directly or
indirectly, alone or as a shareholder (other than as a holder of less than ten
percent (10%) of the common stock of any publicly traded corporation), partner,
officer, director, employee, consultant or advisor, or otherwise in any way
participate in or become associated with, any other business organization that
is engaged or becomes engaged in any business that is the same or substantially
identical business of the Company, or is directly competitive with, any business
activity that the Company is conducting at the time of the Employee’s
termination or has notified the Employee that it proposes to conduct and for
which the Company has, prior to the time of such termination, expended
substantial resources (the “Designated Industry”),

 

(ii)            divert to any competitor of the Company any customer of the
Company, or

 

(iii)           solicit any employee, contributor or faculty member of the
Company to change its relationship with the Company, or hire or offer employment
to any person to whom the Employee actually knows the Company has offered
employment.

 

6.2            Employee agrees to be bound by the provisions of this Section 6
in consideration for the Company’s employment of Employee, payment of the
compensation and benefits provided under Section 3 and Section 4 above and the
covenants and agreements set forth herein. The provisions of this Section 6
shall apply during the term of Employee’s employment with the Company and for a
period of two (2) years following termination of Employee’s employment with the
Company for any reason, whether such termination is at the initiative of
Employee or the Company or before or after expiration of the Term. The parties
agree that the provisions of this Section 6 shall survive any termination of
this Agreement, Employee will continue to be bound by the provisions of this
Section 6 until their expiration and Employee shall not be entitled to any
compensation from the Company with respect thereto except as provided under this
Agreement.

 

6.3            Employee acknowledges that the provisions of this Section 6 are
essential to protect the business and goodwill of the Company. If at any time
the provisions of this Section 6 shall be determined to be invalid or
unenforceable by reason of being vague or unreasonable as to area, duration or
scope of activity, this Section 6 shall be considered divisible and shall become
and be immediately amended to only such area, duration and scope of activity as
shall be determined to be reasonable and enforceable by the court or other body
having jurisdiction over the matter; and the Employee agrees that this Section 6
as so amended shall be valid and binding as though any invalid or unenforceable
provision had not been included herein.

 

7.            Non-Disparagement. Both the Company and Employee agree that
neither they nor any of their respective affiliates, predecessors, subsidiaries,
partners, principals, officers, directors, authorized representatives, agents,
employees, successors, assigns, heirs or family members shall disparage or
defame any other party hereto relating in any respect to this Agreement, their
relationship or the Company’s employment of Employee.

 

8.            Notices. Any notice required or permitted under this Agreement
shall be personally delivered or sent by recognized overnight courier or by
certified mail, return receipt requested, postage prepaid, and shall be
effective when received (if personally delivered or sent by recognized overnight
courier) or on the third day after mailing (if sent by certified mail, return
receipt requested, postage prepaid) to Employee at the address indicated on the
signature page of this Agreement and to the Company at its headquarters or
principal place of business. Either party may designate a different person to
whom notices should be sent at any time by notifying the other party in writing
in accordance with this Agreement.

 

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9.            Survival of Certain Provisions. Those provisions of this Agreement
which by their terms extend beyond the termination or non-renewal of this
Agreement (including all representations, warranties, and covenants of the
parties) shall remain in full force and effect and survive such termination or
non-renewal.

 

10.            Severability. Each provision of this Agreement shall be
considered severable such that if any one provision or clause conflicts with
existing or future applicable law, or may not be given full effect because of
such law, this shall not affect any other provision which can be given effect
without the conflicting provision or clause.

 

11.            Entire Agreement. This Agreement and the Restricted Stock
Agreement contain the entire agreement and understanding between the parties,
and supersede all prior agreements and understandings relating to the subject
matter hereof. There are no understandings, conditions, representations or
warranties of any kind between the parties except as expressly set forth herein
and the Restricted Stock Agreement.

 

12.            Assignability. Employee may not assign this Agreement to any
third party for whatever purpose without the express written consent of the
Company. The Company may not assign this Agreement to any third party without
the express written consent of Employee except by operation of law, or through
merger, liquidation, recapitalization or sale of all or substantially all of the
assets of the Company, provided that the Company may assign this Agreement at
any time to an affiliate of the Company. The provisions of this Agreement shall
inure to the benefit of and be binding upon the parties and their respective
representatives, successors, and assigns.

 

13.            Headings. The headings of the paragraphs and sections of this
Agreement are inserted solely for the convenience of reference. They shall in no
way define, limit, extend, or aid in the construction of the scope, extent, or
intent of this Agreement.

 

14.            Waiver. The failure of a party to enforce the provisions of this
Agreement shall not be construed as a waiver of any provision or the right of
such party thereafter to enforce each and every provision of this Agreement.

 

15.            Amendments. No amendments of this Agreement shall be binding upon
the Company or Employee unless made in writing, signed by the parties hereto,
and delivered to the parties at the addresses provided herein.

 

16.            Governing Law. This Agreement shall be governed by and construed
under the internal laws of the State of Minnesota, without regard to the
principles of comity and/or the applicable conflicts of laws of any state that
would result in the application of any laws other than the State of Minnesota.

 

17.            Jurisdiction. This Agreement, including the documents,
instruments and agreements to be executed and/or delivered by the parties
pursuant hereto, shall be construed, governed by and enforced in accordance with
the internal laws of the State of Minnesota, without giving effect to the
principles of comity or conflicts of laws thereof. Employee and the Company
agree and consent that any legal action, suit or proceeding seeking to enforce
any provision of this Agreement shall be instituted and adjudicated solely and
exclusively in any court of general jurisdiction in Minnesota, or in the United
States District Court having jurisdiction in Minnesota and Employee and the
Company agree that venue will be proper in such courts and waive any objection
which they may have now or hereafter to the venue of any such suit, action or
proceeding in such courts, and each hereby irrevocably consents and agrees to
the jurisdiction of said courts in any such suit, action or proceeding. Employee
and the Company further agree to accept and acknowledge service of any and all
process which may be served in any such suit, action or proceeding in said
courts, and also agree that service of process or notice upon them shall be
deemed in every respect effective service of process or notice upon them, in any
suit, action, proceeding, if given or made (i) according to applicable law, (ii)
by a person over the age of eighteen (18) who personally served such notice or
service of process on Employee or the Company, as the case may be, or (iii) by
certified mail, return receipt requested, mailed to employee or the Company, as
the case may be, at their respective addresses set forth in this Agreement.

 

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18.            Counterparts and Electronic Signatures. This Agreement may be
executed in two or more counterparts, each of which shall be deemed an original
but all of which together shall constitute one and the same Agreement.

 

19.            Taxes and Section 409A. Company may withhold from any amounts
payable under this Agreement such federal, state and local income and employment
taxes as Company shall determine are required to be withheld pursuant to any
applicable law or regulation. Employee shall be solely responsible for the
payment of all taxes due and owing with respect to wages, benefits, and other
compensation provided to him hereunder. This Agreement and the compensation
payable hereunder is intended to satisfy, or be exempt from, the requirements of
Section 409A(a)(2)(3) and (4) of the Internal Revenue Code of 1986, as amended,
including current and future guidance and regulations interpreting such
provisions, and should be interpreted accordingly.

 

[Signature Page Follows]

 

 

 

 

 

 

 

 

 

 

 

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first set forth above.

 

 

  DAKOTA PLAINS HOLDINGS, INC.                 /s/ Gabriel G. Claypool    
Gabriel G. Claypool, Chief Executive Officer                       EMPLOYEE    
            /s/ Robert C. Henry     Robert C. Henry  

 

 

 

 

 

 

 

 

 

 

 

[Signature Page to Employment Agreement]