Exhibit 10.1

 

EXECUTIVE SEVERANCE

AND CONSULTING AGREEMENT

 

This Executive Severance and Consulting Agreement (“Agreement”) is entered into
as of July 24, 2019, by and between Enservco Corporation (the “Company”) and
Dustin Bradford (the “Executive”), who are collectively referred to herein as
the “Parties” and each as a “Party.”

 

WHEREAS, Executive is employed as Chief Financial Officer of the Company
pursuant to an Employment Agreement by and between the Parties entered into
effective January 31, 2018 (“Employment Agreement”), which provides for certain
benefits and compensation to be paid to the Executive upon termination of his
employment;

 

WHEREAS, the Executive has informed the Company of his intention to resign as
the Company’s Chief Financial Officer and all positions he holds with the
Company and its affiliates effective July 24, 2019, and continue to be employed
through August 16, 2019 or such earlier date as determined by the Company under
Sections 1 and 4 below (the “Resignation Date”) and resign his employment with
the Company on the Resignation Date;

 

WHEREAS, the Company desires, in its discretion, to retain the consulting
services of the Executive following the Resignation Date, on an advisory,
independent contractor basis, on the terms and conditions set forth herein, and
Executive has agreed to serve the Company and its affiliates in such role
following the Resignation Date;

 

WHEREAS, the Parties desire to resolve all potential claims of the Executive
under the Employment Agreement, that certain Stock Option Agreement by and
between the Parties entered into effective June 26, 2017 (the “Stock Option
Agreement”), and that certain Restricted Stock Award Agreement by and between
the Parties entered into effective June 14, 2018 (the “Restricted Stock Award
Agreement”); and

 

NOW THEREFORE, in consideration of the terms and promises made in this
Agreement, and other good and valuable consideration, the sufficiency of which
is hereby acknowledged, the Parties agree as follows:

 

1.  Resignation of Executive.  Executive’s resignation (the “Resignation”) will
occur as follows: (i) Executive shall resign his position as Chief Financial
Officer of the Company and all positions he holds with the Company and its
affiliates, effective July 24, 2019; and (ii) Executive shall continue to be
employed by the Company in an advisory role, and Executive’s employment with the
Company and its subsidiaries shall terminate as a result of the Executive’s
resignation on the Resignation Date; provided that the Company may accelerate
the Resignation Date at an earlier date in its sole discretion and retain
Executive as a consultant under terms as set forth in paragraph 4 below. The
Parties intend to and agree that such termination is voluntary.

 

2. Acknowledgments.  The Parties hereby acknowledge and agree that for purposes
of all plans, agreements, policies, and arrangements of the Company and its
affiliates in which the Executive participated or to which the Executive was a
party (including, without limitation, the Employment Agreement), the Resignation
shall be treated as a resignation other than due to an Effective Termination
Without Cause (as defined in the Employment Agreement) pursuant to Subsection 5b
of the Employment Agreement.

 

3. Executive’s Compensation.  Pursuant to Subsection 5b of the Employment
Agreement, the Company agrees to pay and provide to Executive the following
amounts and benefits as a result of the Resignation:

 

(a) Accrued Salary and Benefits.  The Company shall pay Executive his base
salary through the Resignation Date in accordance with the Company’s normal
schedule for payroll payments. In addition, on the Resignation Date, the
Executive shall be paid any remaining balance of the accrued and unpaid
benefits, including unused vacation days and expense reimbursements which are
then due and payable under the Employment Agreement. This payment shall be paid
regardless of the Executive’s right to revoke this Agreement under Section 15
below.

 

(b) Stock Options.  Executive holds certain vested and unvested stock options to
purchase shares of the Company’s common stock pursuant to the Company’s 2016
Stock Incentive Plan (the “2016 Plan”) as described in the Stock Option
Agreement. Pursuant to the terms of the Stock Option Agreement, (i) the Vested
Options  (which the Parties agree constitute 33,334 options) shall remain
exercisable until 5:00 p.m. Mountain Time the date that is 90 days following the
Resignation Date and, if unexercised on such date, shall be forfeited by the
Executive; and (ii) Executive shall forfeit on the Resignation Date all Unvested
Options.

 

(c) Restricted Stock Awards.  Executive holds certain vested and unvested shares
of restricted stock pursuant to the 2016 Plan as described in the Restricted
Stock Award Agreement. Pursuant to the terms of the Restricted Stock Award
Agreement, Executive shall forfeit and reconvey to the Company all unvested
shares of restricted stock on the Resignation Date.

 

4. Consulting Services.  During the period beginning on the date hereof, the
Company may, in its discretion accelerate Executive’s Resignation pursuant to a
written notice to Executive and retain Executive as a consultant ending on the
close of business on September 30, 2019 or at such earlier time as the Company
shall choose in a written notice to Executive (the “Consulting Period”). During
the Consulting Period, the Executive shall provide financial consulting
services, as reasonably directed by the Chief Executive Officer or Chief
Financial Officer of the Company (the “Services”). The Services shall generally
be performed at such locations as are mutually agreed by the Company and the
Executive.

 

(a) Consulting Fee.  In consideration for Executive’s performance of the
Services, the Executive shall be paid a consulting fee of $43,750, payable
ratably during the Consulting Period every two weeks (on the same dates as
Company payroll pay dates and in accordance with Company payroll practices)
until paid in full, subject to the Executive continuing to provide the Services
and to the termination provisions set forth in Section 5 (the “Consulting
Fees”). The Consulting Fees shall be paid in full no later than September 30,
2019.

 

(b) Expenses.  The Company shall reimburse the Executive pursuant to the
Company’s reimbursement policies as in effect from time to time for reasonable
business expenses incurred by the Executive in connection with the performance
of the Services consistent with the treatment accorded and policies applicable
to senior executives of the Company from time to time.

 

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(c)  Sole Consideration.  Except as specifically provided in this Agreement, the
Executive shall be entitled to no additional compensation or benefits from the
Company or its affiliates with respect to the Services and shall not be credited
with any service, age, or other credit for purposes of eligibility, vesting, or
benefit accrual under any employee benefit plan of the Company or any of its
affiliates.

 

(d) Independent Contractor.  Executive acknowledges and agrees that Executive’s
status at all times during the Consulting Period shall be that of an independent
contractor, and that Executive may not, at any time, act as a representative for
or on behalf of the Company for any purpose or transaction, and may not bind or
otherwise obligate the Company in any manner whatsoever. The Parties hereby
acknowledge and agree that the Consulting Fees paid pursuant to this Section 4
shall represent fees for services as an independent contractor, and shall
therefor be paid and issued a Form 1099 without any deductions or withholdings
taken therefrom for taxes or for any other purpose. Executive further
acknowledges that the Company makes no warranties as to any tax consequences
regarding payment of such fees, and specifically agrees that the determination
of any tax liability or other consequences of any payment made hereunder is
Executive’s sole and complete responsibility and that Executive will pay all
taxes, if any, assessed on such payments under the applicable laws of any
Federal, state, local or other jurisdiction and, to the extent not so paid, will
indemnify the Company for any taxes so assessed against the Company. Executive
also agrees that during the Consulting Period, Executive shall not be eligible
to participate in any of the employment benefit plans or arrangements of the
Company.

 

5. Termination of the Consulting Period.

 

(a) Termination.  Either the Company or the Executive may terminate the
Consulting Period at any time and for any reason (or no reason) by providing the
other party with ten days’ advance written notice of such termination, except in
the case of a termination of the Consulting Period by the Company for Cause,
which shall be effective immediately. For purposes of this Agreement, “Cause”
shall mean personal dishonesty, willful misconduct, or a material breach of this
Agreement by the Executive.

 

(b) Termination Payments.  Upon termination of the Consulting Period by the
Company for Cause, or by the Executive for any reason, the Company shall pay to
the Executive any unpaid Consulting Fees for Services rendered prior to such
termination and shall reimburse the Executive for any business expenses incurred
prior to such termination and for which the Executive would be entitled to
reimbursement pursuant to Section 4(b) hereof within ten business days of
termination.  If the Company terminates Executive other than for Cause during
the Consulting Period, the Company shall pay Executive all Consulting Fees for
Services for the entire Consulting Period as set forth in Section 4 hereof. Upon
termination of the Consulting Period and upon payment in full of the Consulting
Fees for Services, the Company shall have no further obligation to the
Executive, except as provided in the immediately preceding sentence.

 

(c) Tax Liability. The parties agree that the payments as described in Section
3(a) represent employee compensation for the purposes of the Internal Revenue
Code, and the Company will make all appropriate employee and employer
withholdings relating thereto. Company will have the right to deduct from any
compensation payable to Executive under Section 3(a) of this Agreement all
federal, state and local income taxes, social security taxes and such other
mandatory deductions normally deducted from the Executive’s compensation (that
is, the Company will not deduct from Executive’s compensation the employer’s
share of FICA, FUTA, Medicaid, etc.) as may now be in effect or may be enacted
or required after the effective date of this Agreement.

 

6. Section 409A.  It is intended that this Agreement shall comply with the
provisions of Section 409A of the Internal Revenue Code of 1986, as amended (the
“Code”), and the Treasury Regulations relating thereto, or an exemption to
Section 409A of the Code. Any payments that qualify for the “short-term
deferral” exception shall be paid under such exception. For purposes of Section
409A of the Code, each payment under this Agreement shall be treated as a
separate payment for purposes of the exclusion for certain short-term deferral
amounts. In no event may the Executive, directly or indirectly, designate the
calendar year of any payment under this Agreement. Notwithstanding anything to
the contrary in this Agreement, all reimbursements provided under this Agreement
shall be made or provided in accordance with the requirements of Section 409A of
the Code, including, where applicable, the requirement that (a) any
reimbursement is for expenses incurred during the Executive’s lifetime (or
during a shorter period of time specified in this Agreement); (b) the amount of
expenses eligible for reimbursement in any other calendar year; (c) the
reimbursement of an eligible expense will be made no later than the last day of
the calendar year following the year in which the expense is incurred; and (d)
the right to reimbursement is not subject to liquidation or exchange for another
benefit.

 

7.  Restrictive Covenants.

 

(a) Confidential Information. During Executive’s employment and for a period of
one year following the Resignation Date, Executive will not, without the prior
written consent of the Board of Directors of the Company, use, divulge, disclose
or make accessible to any other person, firm, partnership, corporation or other
entity any Confidential Information pertaining to the business of the Company or
any of its affiliates, except (a) while employed by the Company, in the business
of and for the benefit of the Company, or (b) as required by law. “Confidential
Information” includes without limitation non-public information concerning the
financial data, business plans, product development (or other proprietary
product data), customer lists, marketing, acquisition and divestiture plans and
other non-public, proprietary and confidential information of the Company.
Executive or his legal representatives, heirs or designated beneficiaries must
return all Confidential Information within 15 days of the Resignation Date.
Executive acknowledges that this Section 7(a) survives the termination of
Executive’s employment and is enforceable by the Company at any time as long as
it remains in effect.

 

(b)  Non-Competition.  For a period of three months following the Resignation
Date, and in lieu of any similar provision in his Employment Agreement,
Executive agrees that, without the prior written consent of the Board of
Directors of the Company, he will not: (i) engage in or have any direct interest
in, as an employee, officer, director, agent, subcontractor, consultant,
security holder, partner, creditor or otherwise, any business in direct
competition with the Company other than as a 2% or less equity stakeholder; (ii)
cause or attempt to cause any person who is, or was at any time during the six
months immediately preceding the Resignation Date, an employee of the Company to
leave the employment of the Company; or (iii) solicit, divert or take away, or
attempt to take away, the business or patronage of any client, customer or
account, or prospective client, customer or account, of the Company. For
purposes of this Section 7(b), a business will be deemed to be in competition
with the Company if it is in the business of providing services to oil and/or
gas production companies similar to those provided by the Company as of the
Resignation Date. Executive acknowledges that this Section 7(b) survives the
termination of Executive’s employment, and is enforceable by the Company at any
time as long as it remains in effect.

 

(i) Executive and the Company agree that this covenant not to compete is a
reasonable covenant under the circumstances with respect to both scope and
duration, and further agree that if, in the opinion of any court of competent
jurisdiction, such restraint is not reasonable in any respect, such court will
have the right, power and authority to excise or modify such provision or
provisions of this covenant as to the court will appear not reasonable and to
enforce the remainder of the covenant as so amended.

 

(ii) Executive agrees that any breach of the covenants contained in this Section
7(b) would irreparably injure the Company. Accordingly, Executive agrees that
the Company may, in addition to pursuing any other remedies it may have in law
and equity, obtain an injunction, without the posting of a bond or other
security, against Executive from any court having jurisdiction over the matter
restraining any further violation of this Agreement by Executive and cease
making any payments otherwise required by this Agreement.

 

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(c) Intellectual Property. Executive acknowledges and agrees that all
intellectual property created, acquired, adapted, modified or improved, in whole
or in part, by or through the efforts of Executive during the course of his
employment by the Company, including without limitation all copyrights, patents,
trademarks, service marks, trade secrets, know-how or other work product in any
way related to the Company’s operations and activities, are works for hire and
are owned exclusively by the Company, and Executive hereby disclaims any right
or interest in or to any such intellectual property.

 

(d) Company Property. On or before the Resignation Date, Executive agrees to
return to the Company any and all records, files, notes, memoranda, reports,
work product and similar items, and any manuals, drawings, sketches, plans, tape
recordings, computer programs, disks, cassettes and other physical
representations of any information, relating to the Company, or any of its
affiliates, whether or not constituting Confidential Information. Executive also
agrees to return to the Company any other property belonging to the Company no
later than seven days after the Resignation Date. Executive acknowledges and
agrees that retaining any copies of Confidential Information or other property
belonging to the Company will be deemed to be the misappropriation of the
property of the Company.

 

8. Non-Disparagement.   The Executive and the Company (including the Board of
Directors and persons speaking with the authority of the Company whether or not
speaking on behalf of the Company) agree to represent the other Party in a
positive light and not to disparage or in any way communicate to any person or
entity any negative information or opinion concerning the Executive or the
Company, its subsidiaries and affiliates, or any of their partners, members,
family members, shareholders, officers, directors, executives or agents, or any
of them. This provision shall not prohibit either Party from making any
statements or taking any actions required by law, or reporting any actions or
inactions either Party believes to be unlawful. This provision shall not be
interpreted to require or encourage either Party to make any representations.

 

9. General Release.  Executive agrees that, in consideration of the benefits to
be conferred upon Executive pursuant to this Agreement, and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, he will, and hereby does, forever and irrevocably release and
discharge Company, its officers, directors, executives, independent contractors,
agents, affiliates, parents, subsidiaries, divisions, predecessors, executive
benefit plans, purchasers, assigns, representatives, successors and successors
in interest from any and all claims, actions, agreements causes of action,
damages of any kind, demands, debts, defenses, grievances, obligations,
contracts, complaints, promises, judgments, expenses, costs, attorneys’ fees,
compensation, and liabilities, known or unknown, whatsoever which he now has,
has had, or may have, whether the same be at law, in equity, or mixed, in any
way arising from or relating to any act, occurrence, or transaction on or before
the date of this Agreement, including without limitation his employment and
separation of employment from Company. Executive expressly acknowledges that
this general release includes, but is not limited to, claims under any state,
local or federal wage and hour law or wage payment or collection law, and claims
of discrimination, retaliation or harassment based on age, race, color, sex,
religion, handicap, disability, national origin, ancestry, citizenship, marital
status, sexual orientation, genetic information or any other protected basis, or
any other claim of employment discrimination, retaliation or harassment under
the Family and Medical Leave Act (29 U.S.C. §§ 2601 et seq.), the Americans With
Disabilities Act (42 U.S.C. §§ 12101 et seq.), the Rehabilitation Act of 1973
(29 U.S.C. §§ 701 et seq.), the Age Discrimination In Employment Act (including
the Older Workers Benefit Protection Act) (29 U.S.C. §§ 626 et seq.), Title VII
of the Civil Rights Acts of 1964 and 1991 as amended (42 U.S.C. §§ 2000e et
seq.), the Executive Retirement Income Security Act (29 U.S.C. §§ 1001 et seq.),
the Consolidated Omnibus Budget Reconciliation Act of 1985 (29 U.S.C. §§ 1161 et
seq.), the Genetic Information Nondiscrimination Act of 2008 (42 U.S.C. §§
2000ff et seq.), the Fair Labor Standards Act (29 U.S.C. §§ 201 et seq.), the
Colorado Anti-Discrimination Act (C.R.S. § 24-34-402 et seq.), or any other
federal, state, or local law, regulation or ordinance prohibiting employment
discrimination or governing employment. The Parties agree that this general
release does not release (i) any claims arising out of any alleged breach of
this Agreement, (ii) any rights or claims the Executive may have for
indemnification under the Certificate of Incorporation of the Company, the
bylaws of the Company or Delaware law, or (iii) any claims arising out of any
alleged breach of the Stock Option Agreement with respect to the Vested Options
held by the Executive as described in Section 3(b), which such agreements the
Executive and Company agree remain in full force and effect.

 

10. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the Parties and their respective personal representatives, heirs,
executors, administrators, successors, and assigns.

 

11. Governing Law. The Parties agree that this Agreement and the rights and
obligations hereunder shall be governed by, and construed in accordance with,
the laws of the State of Colorado regardless of any principles of conflicts of
laws or choice of laws of any jurisdiction, except as to any matter which is
governed by federal law.

 

12. Venue. The Parties agree that any claimed violation of this Agreement must
be submitted for determination in the state courts in the City and County of
Denver, Colorado. In any litigation or arbitration of any dispute between the
Parties, the prevailing Party, as determined by the finder of fact, shall be
entitled to recover reasonable attorney fees and the other costs of the
proceeding.

 

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13. Severability; Interpretation of Agreement. If it is determined by a court of
competent jurisdiction that any provisions of this Agreement are invalid or
unenforceable, for any reason, the remaining provisions will remain in full
force and effect provided such interpretation maintains the agreement of the
parties represented by this Agreement substantially in effect. The language of
all parts of this Agreement shall in all cases be construed as a whole,
according to its fair meaning, and not strictly for or against either of the
Parties.

 

14. Time to Consider Agreement; Revocation. Executive understands that he has
twenty-one (21) days from the date of his receipt of this Agreement to consider
his decision to sign it with the release of claims under the Age Discrimination
in Employment Act, as amended, contained in Section 10, and that he may
unilaterally waive this period at his election. Executive’s signature on this
Agreement constitutes an express waiver of the twenty-one (21) day period. The
Parties agree that any revisions or modifications to this Agreement, whether
material or immaterial, will not and did not restart this time period. Executive
acknowledges that he may revoke this Agreement for up to and including seven (7)
days after his execution of this Agreement.

 

15. Full and Complete Agreement. The Parties agree and understand that no
promises, covenants, representations, understandings or warranties have been
made other than those expressly contained herein, and that this Agreement
constitutes the entire agreement between the Parties. The Parties agree that
this Agreement shall not be modified except in writing signed by each of the
Parties hereto.

 

16. Agreement Freely Entered. Each Party represents to the other Party that it
carefully read this Agreement, that it understands all of the terms hereof, that
it had a reasonable amount of time to consider its decision to sign this
Agreement, that it has been advised in writing and has had the opportunity to
discuss all the terms of this Agreement with an attorney of its choice, that in
executing this Agreement it does not rely and has not relied upon any
representation or statement made by any other Party nor the agents,
representatives or attorneys of such Party with regard to the subject matter,
basis, or effect of the Agreement, and that it enters into this Agreement
voluntarily, of its own free will, without any duress and with knowledge of its
meaning and effect. In entering into this Agreement on behalf of the Company,
the signatory on behalf of the Company represents to Executive that he does so
with all authority necessary to do so.

 

17. Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed an original instrument, but all such counterparts together shall
constitute but one agreement. Any Party’s delivery of an executed counterpart
signature page by facsimile or email is as effective as executing and delivering
this agreement in the presence of the other Party. No Party shall be bound until
such time as both Parties have executed counterparts of this Agreement.

 

[signature page follows]

 

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             IN WITNESS WHEREOF, the Parties have duly executed this Agreement
as of July 24, 2019.

               

 

                                                                                                               
THE COMPANY:

ENSERVCO CORPORATION

 

                                                                                                               
/s/ Ian A. Dickinson                                                           

                                                                                                               
By: Ian A. Dickinson

                                                                                                               
Title: Chief Executive Officer

 

 

EXECUTIVE:

DUSTIN BRADFORD

 

                                                                                                               
/s/ Dustin Bradford                                                    

                                                                                
                               Dustin Bradford