EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into as of the 1st day of January, 2021 (the “Effective Date”), by and between American Rebel Holdings, Inc., a Nevada corporation (“American Rebel”), and Charles A. Ross, Jr. (“Ross”).

 

WITNESSETH:

 

WHEREAS, American Rebel is a publicly traded Nevada corporation with its common stock traded on the Over-the-Counter Market under the symbol “AREB” and registered with the United States Securities and Exchange Commission.

 

WHEREAS, American Rebel and Ross desire to enter into this Employment Agreement, pursuant to which Ross shall be employed by American Rebel, to set forth the respective rights, duties and obligations of the parties hereto.

 

NOW THEREFORE, in consideration of the promises and covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which the parties hereto acknowledge, American Rebel and Ross agree as follows:

 

1. EMPLOYMENT. American Rebel hereby agrees to employ Ross as its Chief Executive Officer and Ross hereby accepts such employment, upon the terms and conditions hereinafter set forth. 

 

2. TERM. For purposes of this Agreement, “Term” shall mean the original term (as defined in Section 2.1 below), if Renewal Term is initiated, then “Term” shall mean the renewal term period (as defined in Section 2.2, below). 

 

2.2 Original Term: The Term of this Agreement shall commence on January 1, 2021 and expire on December 31, 2025, unless sooner terminated pursuant to the terms and provisions herein stated. 

 

2.3 Renewal: At any time prior to the expiration of the Original Term, as stated above, American Rebel and Ross may, by mutual written agreement, extend Ross’ employment under the terms of this Agreement for such additional periods as they may agree. 

 

3. COMPENSATION. 

 

3.1 Cash Salary: American Rebel shall pay Ross a base cash salary of One Hundred Eighty Thousand Dollars ($180,000) per year (“Salary”). Such Salary shall be payable in accordance with American Rebel’s normal policies. Further, the Board of Directors shall review the Salary annually for an increase, such increase not to be less than the year-over-year increase in the U.S. Consumer Price Index.  

 

3.2 Retention Bonus; Preferred Stock Grant: Concurrent with the signing of this Agreement, American Rebel shall grant and issue to Ross fifty thousand (50,000) shares of Series A - Super Voting Convertible Preferred Stock, valued at $50.  

 

3.3 Incentive Compensation: In addition to the Salary, Ross shall be eligible to receive as incentive compensation (“Bonus”) in respect of each fiscal year (or portion thereof) of American Rebel, up to one hundred percent (100%) of his then applicable Salary, in addition to any other amount determined in accordance with any other short term incentive compensation program, which has been or may be established by the Board either for Ross or for executives or senior management. The determination as to the amounts of any awards to be paid to Ross under these programs shall be reviewed at least annually by the Board to ensure that such amounts are competitive with awards granted to similarly situated CEOs of companies comparable to American Rebel. The specific goals and objectives, including quantitative and qualitative measures, used to determine the amount to be paid as a Bonus for each fiscal year shall be agreed to by and between the CEO and the Board not later than June 30^th of each successive year this Agreement.  

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4. ROSS BENEFITS. 

 

4.1 General Benefits: Ross shall be entitled to receive or participate in all benefit plans and programs of American Rebel made available from time to time to executives or senior management of American Rebel, including but not limited to, dental and medical insurance, pension and profit sharing plans, 401(k) plans, incentive savings plans, stock option plans, restricted stock plans, group life insurance, salary continuation plans, disability coverage and other fringe benefits. 

 

4.2 Vacation: Ross shall be entitled during the Term of this Agreement to four (4) weeks vacation per year during which time Ross’ compensation will be paid in full. Unused days of vacation will be compensated in accordance with American Rebel’s policy as established by American Rebel from time to time. Ross may take the vacation periods at any time during the year as long as Ross schedules time off as to not create an unreasonable hardship on American Rebel. In addition, Ross shall have such other days off, including paid sick leave and paid holidays, in accordance with American Rebel’s policy. 

 

4.3 Business Expenses: American Rebel shall, in accordance with, and to the extent of, its policies in effect from time to time, bear all customary business expenses (including the advancement of certain expenses) incurred by Ross in performing his duties as an executive of American Rebel, provided that Ross accounts promptly for such expenses to American Rebel in the manner prescribed from time to time by American Rebel. 

 

5. DUTIES/SERVICE. 

 

5.1 Position: Ross shall be employed as Chief Executive Officer and shall perform such duties as are normally associated with such position, subject to the direction, supervision and rules and regulations of American Rebel. 

 

5.2 Place of Employment: The place of Ross’ employment and the performance of Ross’ duties will be primarily on a full-time remote basis from his Nashville, Tennessee home, less than full-time at American Rebel’s corporate headquarters, or at such other location as agreed upon by American Rebel and Ross. 

 

5.3 Extent of Services: Ross shall devote his full-time and best efforts to American Rebel and shall fulfill the duties of his position which shall include such duties as may, from time to time be assigned to him by the Board, provided such duties are reasonably consistent with Ross’ education, experience and background. American Rebel acknowledges Ross presently, or may in the future, serve on the Board, be the manager or member of, provide consulting services for or be an executive officer of other companies and such action shall not be a breach of this section; provided, however, that such companies are: (a) listed on Exhibit A, attached hereto and updated from time to time; and (b) do not compete with American Rebel or interfere with the performance of Ross’ duties pursuant to this Agreement, as determined in the reasonable judgment of the Board. Additionally, American Rebel recognizes that Ross has, or may have in the future, equity positions in other companies, which either: (a) are listed on Exhibit A attached hereto and updated from time to time; or (b) do not compete with American Rebel in the reasonable judgment of the Board. American Rebel recognizes that such equity positions may require attention from Ross during normal business hours. However, Ross agrees that if such time is considered excessive by the Board, Ross shall be so advised and noticed by American Rebel and Ross shall be required to make appropriate adjustments to ensure his duties and obligations under this Agreement are fulfilled. 

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6. TERMINATION. The Term of this Agreement shall end upon its expiration pursuant to Section 2 hereof, provided that this Agreement shall terminate prior to such date: (a) upon Ross’ resignation, death or permanent disability or incapacity; or (b) by American Rebel at any time for “Cause” (as defined in Section 6.4 below) or without Cause. 

 

6.1 By Resignation Prior to Change of Control: If Ross resigns with “Good Reason” (as defined below) prior to a Change of Control (as defined in Section 7), this Agreement shall terminate but, Ross shall be entitled to receive a lump sum payment equal to twelve (12) months Salary, plus any equity compensation due, plus his prorated Bonus through the date of termination. Further, upon resignation for Good Reason prior to a Change of Control, all unvested stock or options held by Ross shall immediately vest and become exercisable for the full term set forth in such stock option or equity award agreements. To the extent Ross elects to continue his group health coverage pursuant to COBRA following his termination of employment, then Ross shall be eligible to continue such coverage for himself and his dependents (if applicable), at American Rebel’s expense, for a period of twelve (12) months at the same cost as if Ross were still an employee of American Rebel. To the extent that American Rebel finds it undesirable to cover Ross under its group health plan, American Rebel shall provide Ross (at American Rebel’s expense) with the same level of coverage under an individual policy or policies. 

 

For purposes of this Agreement, “Good Reason” shall mean any of the following if the same shall occur without Ross’ express written consent:

 

(i) a material diminution in Ross’ Salary;  

 

(ii) a material diminution in Ross’ authority, duties, or responsibilities;  

 

(iii) a material change in the geographic location at which Ross must perform the services for which he is employed; or  

 

(iv)a change in the current reporting structure of the CEO reporting directly to the entire Board; or 

 

(v) any other action or inaction that constitutes a material breach by American Rebel under this Agreement.  

 

Ross shall be required to provide notice to American Rebel of the existence of any of the foregoing conditions within 30 days of the initial existence of the condition, upon the notice of which American Rebel shall have a period of 30 days during which it may remedy the condition without giving rise to the obligations under this Section 6.1

 

If Ross resigns without Good Reason, Ross shall be entitled to receive Ross’ Salary only through the date of such resignation.

 

6.2 By Reason of Incapacity or Disability: If Ross becomes so incapacitated by reason of accident, illness, or other disability that Ross is unable to carry on substantially all of the normal duties and obligations of Ross under this Agreement for a continuous period of sixty (60) calendar days, this Agreement shall terminate. For purposes of the foregoing, Ross’ permanent disability or incapacity shall be determined in accordance with American Rebel’s disability insurance policy, if such a policy is then in effect, or if no such policy is then in effect, such permanent disability or incapacity shall be determined by American Rebel’s Board of Directors in its good faith judgment based upon Ross’ inability to perform normal and reasonable duties and obligations. If Ross’ employment is terminated due to such disability, Ross shall be entitled to receive Ross’ Salary only through the date of such termination. Other disability benefits, if any, will be determined in accordance with the terms of American Rebel’s benefit plans and programs. 

 

6.3 By Reason of Death: If Ross dies during the Term of this Agreement, American Rebel shall pay to the estate of Ross any earned Salary only through the date of Ross’ death. Other death benefits, if any, will be determined in accordance with the terms of American Rebel’s benefit plans and programs. 

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6.4 For Cause: If this Agreement is terminated by American Rebel for Cause, Ross shall be entitled to receive Ross’ Salary only through the date of termination.  

 

For purposes of this Agreement, “Cause” shall mean:

 

(i)any act of dishonesty or fraud with respect to American Rebel;  

 

(ii)Ross’ conviction of a felony, a crime involving moral turpitude or other act causing material harm to American Rebel’s standing and reputation;  

 

(iii)Ross’ continued material failure to perform Ross’ duties to American Rebel after ten (10) business days’ written notice thereof to Ross; or 

 

(iv)gross negligence or willful misconduct by Ross with respect to American Rebel.  

 

American Rebel shall provide Ross, within ten (10) business days of becoming aware of a “For Cause” breach, written notice, which shall include written documentation, if any, of the “For Cause” breach, as defined above. Upon receipt of the written notice, Ross shall have thirty (30) calendar days to respond to American Rebel’s notice and attempt to cure or resolve the “For Cause” breach. If after that 30 day period, in the judgment of the Board, the “For Cause” breach still exists, then termination shall become effective immediately.

 

6.5 Without Cause Prior to Change of Control: If American Rebel terminates Ross’ employment without Cause prior to a Change of Control, Ross shall be entitled to receive a lump sum payment equal to twelve (12) months Salary plus his prorated Bonus through the date of termination. Further, all unvested stock or options held by Ross shall immediately vest and become exercisable for the full term set forth in such stock option or equity award agreements. To the extent Ross elects to continue his group health coverage pursuant to COBRA following his termination of employment, then Ross shall be eligible to continue such coverage for himself and his dependents (if applicable), at American Rebel’s expense, for a period of twelve (12) months at the same cost as if Ross were still an employee of American Rebel. To the extent that American Rebel finds it undesirable to cover Ross under its group health plan, American Rebel shall provide Ross (at American Rebel’s expense) with the same level of coverage under an individual policy or policies. Ross expressly agrees and understands that, under such circumstances, he shall be entitled only to the payments recited herein, including any prorated Bonus through the date of termination, and he shall not be entitled to any further compensation of any kind through the Term of the Agreement. 

 

6.6 Change of Control Severance: If American Rebel terminates Ross’ employment without Cause within twelve (12) months after a Change of Control, or Ross resigns his employment with Good Reason within twelve (12) months after a Change of Control, Ross shall be entitled to receive a lump sum payment equal to twelve (12) months Salary plus 100% of his prior year’s Bonus. Further, all stock options or equity awards granted by American Rebel shall immediately vest and become exercisable for the full term set forth in such stock option or equity award agreements. To the extent Ross elects to continue his group health coverage pursuant to COBRA following his termination of employment, then Ross shall be eligible to continue such coverage for himself and his dependents (if applicable), at American Rebel’s expense, for a period of twelve (12) months at the same cost as if Ross were still an employee of American Rebel. To the extent that American Rebel finds it undesirable to cover Ross under its group health plan, American Rebel shall provide Ross (at American Rebel’s expense) with the same level of coverage under an individual policy or policies. 

 

6.7 No Mitigation: Ross shall not be required to mitigate the amount of any payment or benefit contemplated by this Agreement, nor shall any such payment or benefit be reduced by any earnings or benefits Ross may receive from any other source. 

 

6.8 Effect of Termination on Unused Vacation Time and Other Benefits: Upon the termination of this Agreement, unless termination is for Cause, Ross shall also have the right to receive any accrued but unused vacation time for that current fiscal year, and any benefits vested under the terms of any applicable benefit plans. 

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6.9 Time of Payment: Any amounts payable under this Section 6 shall be paid in a single lump sum within 30 days following Ross’ termination of employment. The parties intend that all such payments shall satisfy the short term deferral exception under Treasury Regulation §1.409A-1(b)(4) and therefore shall be exempt from the requirements of Section 409A of the Internal Revenue Code of 1986, as amended. 

 

6.10 Release and Waiver: Notwithstanding the preceding provisions of this Section 6 or any other provision in this Agreement to the contrary, Ross’ entitlement to any post-termination payment under this Agreement shall be subject to and conditioned upon Ross’ execution of a release and waiver of claims on the form reasonably acceptable to American Rebel.  

 

7. CHANGE OF CONTROL.  

 

For purposes of this Agreement a “Change of Control” shall mean:

 

(i)The consummation of a merger or consolidation of American Rebel with or into another entity or any other corporate reorganization, if more than 50% of the combined voting power of the continuing or surviving entity’s securities outstanding immediately after such merger, consolidation or other reorganization is owned by persons who were not stockholders of American Rebel immediately prior to such merger, consolidation or other reorganization;  

 

(ii)the sale, transfer or other disposition of all or substantially all of American Rebel’s assets; or 

 

(iii)The date that 40% or more of the current members of the Board of Directors as of the date of this Agreement are replaced by directors who are not currently members of the Board of Directors. 

 

8. TRADE SECRETS AND CONFIDENTIALITY. 

 

8.1 Nondisclosure: Without the prior written consent of American Rebel, Ross shall not, at any time, either during or after the term of this Agreement, directly or indirectly, divulge or disclose to any person, firm, association, or corporation, or use for Ross’ own benefit, gain, or otherwise, any customer lists, plans, products, data, results of tests and data, or any other trade secrets or confidential materials or like information (collectively referred to as the “Confidential Information”) of American Rebel and/or its Affiliates, as hereinafter defined, it being the intent of American Rebel, with which intent Ross hereby agrees, to restrict Ross from disseminating or using any like information that is unpublished or not readily available to the general public. 

 

8.1.1 Definition of Affiliate. For purposes of this Agreement, the term “Affiliate” shall mean any entity, individual, firm, or corporation, directly or indirectly, through one or more intermediaries, controlling, controlled by, or under common control with American Rebel. 

 

8.2 Notice of Compelled Disclosure: If, at any time, Ross becomes legally compelled (by deposition, interrogatory, request for documents, subpoena, civil investigative demand, or similar process or otherwise) to disclose any of the Confidential Information, Ross shall provide American Rebel with prompt, prior written notice of such requirement so that American Rebel may seek a protective order or other appropriate remedy and/or waive compliance with the terms of this Agreement. In the event that such protective order or other remedy is not obtained, that American Rebel waives compliance with the provisions hereof, Ross agrees to furnish only that portion of the Confidential Information which Ross is advised by written opinion of counsel is legally required and exercise Ross’ best efforts to obtain assurance that confidential treatment will be accorded such Confidential Information. In any event, Ross shall not oppose action by American Rebel to obtain an appropriate protective order or other reliable assurance that confidential treatment will be accorded the Confidential Information. 

 

8.3 Assurance of Compliance: Ross agrees to represent to American Rebel, in writing, at any time that American Rebel shall reasonably request, that Ross has complied with the provisions of this section, or any other section of this Agreement. 

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9. NON-COMPETITION AND NON-SOLICITATION.  

 

9.1 Covenant Not To Compete. Ross acknowledges and agrees that in consideration of and reliance upon his employment, American Rebel shall allow Ross access to American Rebel’s proprietary information and data, including but not limited to processes, suppliers, present and future business plans, marketing strategies, marketing channels, distributors, budgets, manufacturers, investors and stockholders. Ross acknowledges and agrees that any and all such information and data could be used to the competitive disadvantage of American Rebel. Accordingly, for the term of this Agreement and for a period of twelve (12) months following the termination of this Agreement (except in the case of termination of this Agreement pursuant to Section 6 because of a Change of Control or any Business Combination or any termination of this Agreement (without cause)), Ross shall not, without the express written consent of American Rebel, directly or indirectly in any manner, including without limitation by employment, contract, consultation, investment (either directly or beneficially) assist any person or entity in engaging in any competition with American Rebel. The term “engaging in competition” as used herein shall be deemed to be used in its ordinary meaning and sense and shall include engaging in, assisting or have an interest in, or entering the employment of or acting as an agent, advisor or consultant for, any person or entity which is engaged in, or will be engaged in, the development, manufacture, supplying or sale of a product, process, service or development which is competitive with a product, process, service or development on which American Rebel has expended resources and on which Ross worked or with respect to which Ross has or had access to Confidential Information while at Company. Upon the Effective Date, Ross agrees that the geographical scope of this covenant not to compete shall be North America.  

 

9.2 Acknowledgment Regarding Restrictions. Ross recognizes and agrees that the restraints contained in Section 9.1, including the geographic scope thereof in light of American Rebel’s marketing efforts, are reasonable and enforceable in view of American Rebel’s legitimate interests in protecting its Confidential Information and customer goodwill and the limited scope of the restrictions in Section 9.1. 

 

9.3 Enforcement in Equity. Ross acknowledges and agrees that in the event that there is a breach of the covenant not to compete or of the non-solicitation covenant set forth herein, that American Rebel has no adequate remedy at law. Accordingly, the parties agree that American Rebel may enforce these covenants in equity by way of injunctive relief, both temporary and permanent. The exclusive jurisdiction and venue for any such actions shall be the District Court of Davidson County, Tennessee and Ross irrevocably consents to the personal jurisdiction of that court for such purposes. American Rebel shall not be deemed stopped from combining a claim for injunctive relief with a claim for money damages in the same action. In the event that American Rebel is the prevailing party in any such action, they shall be entitled to recover their reasonable attorney’s fees as part of the judgment in the action. 

 

9.4 Non-Solicitation; Agreement not to Hire/be Hired. Ross understands and appreciates that American Rebel invests a tremendous amount of time, energy, resources and expertise in the training and education of its employees to be able to operate its operations. Further, Ross understands that in the event an employee of American Rebel or any of its operating subsidiaries, is enticed to leave, then American Rebel shall be damaged in an amount the Parties are not capable of calculating at the present time. Therefore, Ross agrees, that during any non-compete period set forth above and continuing for an additional six (6) month period, that he will not offer employment or contractor status to any employee or contractor or affiliated person of American Rebel, or accept employment or contractor status from any employee or contractor or affiliated person of American Rebel or its operating subsidiaries, nor to allow any person or entity affiliated with Ross to offer such employment status with Ross or any other concern, venture or entity with whom Ross may be employed by, associated or hold a more than five percent (5%) ownership position in. 

 

10. RETURN OF AMERICAN REBEL PROPERTY. Ross agrees that upon any termination of his employment, Ross shall return to American Rebel within a reasonable time not to exceed forty-eight (48) hours, any of American Rebel’s property in his possession or under his control, including but not limited to, all lists, books, records, data, and other information (including all copies thereof in whatever form or media) of every kind relating to or connected with American Rebel or its Affiliates and their activities, business and customers, computer/office automation equipment, records and names, addresses, and other information with regard to customers or potential customers of American Rebel with whom Ross has had contact or done business. 

 

11. RELATIONSHIP OF PARTIES. The parties intend that this Agreement create an Employee-Employer relationship between the parties. 

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12. NOTICES. All notices, required and demands and other communications hereunder must be in writing and shall be deemed to have been duly given when personally delivered or when placed in the United States Mail and forwarded by Registered or Certified Mail, Return Receipt Requested, postage prepaid, or when forwarded via reputable overnight carrier, addressed to the party to whom such notice is being given at the following address: 

 

As to American Rebel: American Rebel Holdings, Inc. 

718 Thompson Lane, Ste 108-199

Nashville, Tennessee 37204

Attn: Board of Directors

 

As to Ross: Charles A. Ross, Jr. 

900 20th Avenue South, #1206

Nashville, Tennessee 37212

 

Address Change: Any party may change the address(es) at which notices to it or him, as the case may be, are to be sent by giving the notice of such change to the other parties in accordance with this Section 12. 

 

13. MISCELLANEOUS. 

 

13.1 Entire Agreement: This Agreement and the Exhibits hereto contain the entire agreement of the parties. This Agreement may not be altered, amended or modified except in writing duly executed by the parties. 

 

13.2 Assignment: Neither party, without the written consent of the other party, can assign this Agreement. 

 

13.3 Binding: This Agreement shall be binding upon and inure to the benefit of the parties, their personal representative, successors and assigns. 

 

13.4 No Waiver: The waiver of the breach of any covenant or condition herein shall in no way operate as a continuing or permanent waiver of the same or similar covenant or condition. 

 

13.5 Severability: If any provision of this Agreement is held to be invalid or unenforceable for any reason, the remaining provisions will continue in full force without being impaired or invalidated in any way. The parties hereto agree to replace any invalid provision with at valid provision which most closely approximates the intent of the invalid provision. 

 

13.6 Interpretation: This Agreement shall not be construed more strongly against any party hereto regardless of which party may have been more responsible for the preparation of Agreement. 

 

13.7 Governing Law: This Agreement shall be governed by and construed under the laws of the State of Tennessee, without reference to the choice of law principles thereof. 

 

13.8 Arbitration: 

 

13.8.1 Any controversy, dispute or claim of whatever nature in any way arising out of or relating to Ross’ employment with American Rebel, including, without limitation (except as expressly excluded below in Section 13.8.2) any claims or disputes by Ross against American Rebel, or by American Rebel against Ross, concerning, arising out of or relating to the separation of that employment; any other adverse personnel action by American Rebel; any federal, state or local law, statute or regulation prohibiting employment discrimination or harassment; any public policy; any American Rebel disciplinary action; any American Rebel decision regarding a American Rebel policy or practice, including but not limited to Ross’ compensation or other benefits; and any other claim for personal, emotional, physical or economic injury (individually or collectively, “Covered Claims”) shall be resolved, at the request of any party to this Agreement, by final and binding arbitration in Las Vegas, Nevada before Judicial Arbitration Mediation Services (“JAMS”) in accordance with JAMS’ then-current policies and procedures for arbitration of employment disputes. All costs for such arbitration, including but not limited to Ross’ attorney’s fees, professional fees, witness fees or any other costs, expenses, or fees related to the arbitration, regardless of the party bringing the action, shall be borne by American Rebel. 

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13.8.2 The only claims or disputes excluded from binding arbitration under this Agreement are the following: any claim by Ross for workers’ compensation benefits or for benefits under an American Rebel plan that provides its own arbitration procedure; and any claim by either party for equitable relief, including but not limited to, a temporary restraining order, preliminary injunction or permanent injunction against the other party. 

 

13.8.3 This agreement to submit all Covered Claims to binding arbitration in no way alters the exclusivity of Ross’ remedy under Section 6.5 in the event of any termination without Cause or the exclusivity of Ross’ remedy under Section 6.4 in the event of any termination for Cause, and does not require American Rebel to provide Ross with any type of progressive discipline. 

 

13.9 Taxes: American Rebel is authorized to withhold from any payment or benefit provided hereunder, the amount of withholding taxes due any federal, state or local authority in respect of such benefit or payment and to take such other action as may be necessary in the opinion of American Rebel to satisfy all obligations for the payment of such withholding taxes. In the event American Rebel does not make such deductions or withholdings, Ross shall indemnify American Rebel for any amounts paid with respect to any such taxes, together with any interest, penalties and related expenses thereto. Ross acknowledges that no oral or written representation of fact or opinion has been made to him by American Rebel or its attorneys regarding the tax treatment or consequences of any payment made under this Agreement. Ross acknowledges and agrees that to the extent any liability or responsibility exists for Ross’ federal, state and local income or other taxes, such liability or responsibility rests solely with his. Ross further agrees to indemnify and hold harmless American Rebel in connection with any liability incurred by American Rebel in connection with any tax or taxes for which Ross is responsible. 

 

13.10 Section 409A of the Internal Revenue Code: To the extent applicable, this Agreement shall be interpreted, construed and operated in accordance with the Section 409A of the Internal Revenue Code, and the Treasury regulations and other guidance issued thereunder. Any reference to termination of employment, severance from employment or similar terms shall mean and be interpreted as a “separation from service” as defined (as defined in Treasury Regulation §1.409A-1(h)). If on the date of Ross’ separation from service with American Rebel, Ross is a specified employee (as defined in Code Section 409A and Treasury Regulation §1.409A-1(i)), no payment constituting the “deferral of compensation” within the meaning of Treasury Regulation §1.409A-1(b) and after application of the exemptions provided in Treasury Regulation §§1.409A-1(b)(4) and 1.409A-1(b)(9)(iii) shall be made to Ross at any time during the six (6) month period following Ross’ separation from service, and any such amounts shall instead be paid in a lump sum on the first payroll payment date following expiration of such six (6) month period. Any obligation of American Rebel to reimburse Ross for expenses incurred during any taxable year of Ross shall not affect the expenses eligible for reimbursements in any other taxable year. Further, such reimbursement of expenses shall be made on or before the last day of Ross’ taxable year following the taxable year in which the expense was incurred. 

 

13.11 Titles: Titles to the sections of this Agreement are solely for the convenience of the parties and shall not be used to explain, modify, simplify, or aid in the interpretation of the provisions of this Agreement. 

 

13.12 Counterparts: This Agreement may be executed in counterparts, each of which shall be deemed an original, but together which shall constitute one and the same instrument. 

 

SIGNATURE PAGE TO FOLLOW

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first written above.

 

THIS AGREEMENT CONTAINS AN ARBITRATION CLAUSE.

 

	American Rebel Holdings, Inc.
	a Nevada corporation
American Rebel:
	By:	/s/ Doug Grau
		Doug Grau, President
Ross:
		/s/ Charles A. Ross, Jr.
		Charles A. Ross, Jr.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Signature Page to Employment Agreement

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EXHIBIT A

 

 

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into as of the 1st day of January, 2021 (the “Effective Date”), by and between American Rebel Holdings, Inc., a Nevada corporation (“American Rebel”), and Doug Grau (“Grau”).

 

WITNESSETH:

 

WHEREAS, American Rebel is a publicly traded Nevada corporation with its common stock traded on the Over-the-Counter Market under the symbol “AREB” and registered with the United States Securities and Exchange Commission.

 

WHEREAS, American Rebel and Grau desire to enter into this Employment Agreement, pursuant to which Grau shall be employed by American Rebel, to set forth the respective rights, duties and obligations of the parties hereto.

 

NOW THEREFORE, in consideration of the promises and covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which the parties hereto acknowledge, American Rebel and Grau agree as follows:

 

1. EMPLOYMENT. American Rebel hereby agrees to employ Grau as its President and Grau hereby accepts such employment, upon the terms and conditions hereinafter set forth. 

 

2. TERM. For purposes of this Agreement, “Term” shall mean the original term (as defined in Section 2.1 below), if Renewal Term is initiated, then “Term” shall mean the renewal term period (as defined in Section 2.2, below). 

 

1.1 Original Term: The Term of this Agreement shall commence on January 1, 2021 and expire on December 31, 2025, unless sooner terminated pursuant to the terms and provisions herein stated. 

 

1.2 Renewal: At any time prior to the expiration of the Original Term, as stated above, American Rebel and Grau may, by mutual written agreement, extend Grau’s employment under the terms of this Agreement for such additional periods as they may agree. 

 

3. COMPENSATION. 

 

3.1 Cash Salary: American Rebel shall pay Grau a base cash salary of One Hundred Thousand Dollars ($120,000) per year (“Salary”). Such Salary shall be payable in accordance with American Rebel’s normal policies. Further, the Board of Directors shall review the Salary annually for an increase, such increase not to be less than the year-over-year increase in the U.S. Consumer Price Index.  

 

3.2 Retention Bonus; Preferred Stock Grant: Concurrent with the signing of this Agreement, American Rebel shall grant and issue to Grau fifty thousand (50,000) shares of Series A - Super Voting Convertible Preferred Stock, valued at $50.  

 

3.3 Incentive Compensation: In addition to the Salary, Grau shall be eligible to receive as incentive compensation (“Bonus”) in respect of each fiscal year (or portion thereof) of American Rebel, up to one hundred percent (100%) of his then applicable Salary, in addition to any other amount determined in accordance with any other short term incentive compensation program, which has been or may be established by the Board either for Grau or for executives or senior management. The determination as to the amounts of any awards to be paid to Grau under these programs shall be reviewed at least annually by the CEO to ensure that such amounts are competitive with awards granted to similarly situated Presidents of companies comparable to American Rebel. The specific goals and objectives, including quantitative and qualitative measures, used to determine the amount to be paid as a Bonus for each fiscal year shall be agreed to by and between the CEO and the President not later than June 30^th of each successive year this Agreement.  

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4. GRAU BENEFITS. 

 

4.1 General Benefits: Grau shall be entitled to receive or participate in all benefit plans and programs of American Rebel made available from time to time to executives or senior management of American Rebel, including but not limited to, dental and medical insurance, pension and profit sharing plans, 401(k) plans, incentive savings plans, stock option plans, restricted stock plans, group life insurance, salary continuation plans, disability coverage and other fringe benefits. 

 

4.2 Vacation: Grau shall be entitled during the Term of this Agreement to four (4) weeks vacation per year during which time Grau’s compensation will be paid in full. Unused days of vacation will be compensated in accordance with American Rebel’s policy as established by American Rebel from time to time. Grau may take the vacation periods at any time during the year as long as Grau schedules time off as to not create an unreasonable hardship on American Rebel. In addition, Grau shall have such other days off, including paid sick leave and paid holidays, in accordance with American Rebel’s policy. 

 

4.3 Business Expenses: American Rebel shall, in accordance with, and to the extent of, its policies in effect from time to time, bear all customary business expenses (including the advancement of certain expenses) incurred by Grau in performing his duties as an executive of American Rebel, provided that Grau accounts promptly for such expenses to American Rebel in the manner prescribed from time to time by American Rebel. 

 

5. DUTIES/SERVICE. 

 

5.1 Position: Grau shall be employed as President and shall perform such duties as are normally associated with such position, subject to the direction, supervision and rules and regulations of American Rebel. 

 

5.2 Place of Employment: The place of Grau’s employment and the performance of Grau’s duties will be on a full-time basis at American Rebel’s corporate headquarters or at such other location as agreed upon by American Rebel and Grau. 

 

5.3 Extent of Services: Grau shall devote his full-time and best efforts to American Rebel and shall fulfill the duties of his position which shall include such duties as may, from time to time be assigned to him by the CEO, provided such duties are reasonably consistent with Grau’s education, experience and background. American Rebel acknowledges Grau presently, or may in the future, serve on the Board, be the manager or member of, provide consulting services for or be an executive officer of other companies and such action shall not be a breach of this section; provided, however, that such companies are: (a) listed on Exhibit A, attached hereto and updated from time to time; and (b) do not compete with American Rebel or interfere with the performance of Grau’s duties pursuant to this Agreement, as determined in the reasonable judgment of the CEO. Additionally, American Rebel recognizes that Grau has, or may have in the future, equity positions in other companies, which either: (a) are listed on Exhibit A attached hereto and updated from time to time; or (b) do not compete with American Rebel in the reasonable judgment of the Board. American Rebel recognizes that such equity positions may require attention from Grau during normal business hours. However, Grau agrees that if such time is considered excessive by the CEO, Grau shall be so advised and noticed by American Rebel and Grau shall be required to make appropriate adjustments to ensure his duties and obligations under this Agreement are fulfilled. 

 

6. TERMINATION. The Term of this Agreement shall end upon its expiration pursuant to Section 2 hereof, provided that this Agreement shall terminate prior to such date: (a) upon Grau’s resignation, death or permanent disability or incapacity; or (b) by American Rebel at any time for “Cause” (as defined in Section 6.4 below) or without Cause. 

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6.1 By Resignation Prior to Change of Control: If Grau resigns with “Good Reason” (as defined below) prior to a Change of Control (as defined in Section 7), this Agreement shall terminate but, Grau shall be entitled to receive a lump sum payment equal to twelve (12) months Salary, plus any equity compensation due, plus his prorated Bonus through the date of termination. Further, upon resignation for Good Reason prior to a Change of Control, all unvested stock or options held by Grau shall immediately vest and become exercisable for the full term set forth in such stock option or equity award agreements. To the extent Grau elects to continue his group health coverage pursuant to COBRA following his termination of employment, then Grau shall be eligible to continue such coverage for himself and his dependents (if applicable), at American Rebel’s expense, for a period of twelve (12) months at the same cost as if Grau were still an employee of American Rebel. To the extent that American Rebel finds it undesirable to cover Grau under its group health plan, American Rebel shall provide Grau (at American Rebel’s expense) with the same level of coverage under an individual policy or policies. 

 

For purposes of this Agreement, “Good Reason” shall mean any of the following if the same shall occur without Grau’s express written consent:

 

(i) a material diminution in Grau’s Salary;  

 

(ii) a material diminution in Grau’s authority, duties, or responsibilities;  

 

(iii) a material change in the geographic location at which Grau must perform the services for which he is employed; or  

 

(iv)any other action or inaction that constitutes a material breach by American Rebel under this Agreement.  

 

Grau shall be required to provide notice to American Rebel of the existence of any of the foregoing conditions within 30 days of the initial existence of the condition, upon the notice of which American Rebel shall have a period of 30 days during which it may remedy the condition without giving rise to the obligations under this Section 6.1

 

If Grau resigns without Good Reason, Grau shall be entitled to receive Grau’s Salary only through the date of such resignation.

 

6.2 By Reason of Incapacity or Disability: If Grau becomes so incapacitated by reason of accident, illness, or other disability that Grau is unable to carry on substantially all of the normal duties and obligations of Grau under this Agreement for a continuous period of sixty (60) calendar days, this Agreement shall terminate. For purposes of the foregoing, Grau’s permanent disability or incapacity shall be determined in accordance with American Rebel’s disability insurance policy, if such a policy is then in effect, or if no such policy is then in effect, such permanent disability or incapacity shall be determined by American Rebel’s Board of Directors in its good faith judgment based upon Grau’s inability to perform normal and reasonable duties and obligations. If Grau’s employment is terminated due to such disability, Grau shall be entitled to receive Grau’s Salary only through the date of such termination. Other disability benefits, if any, will be determined in accordance with the terms of American Rebel’s benefit plans and programs. 

 

6.3 By Reason of Death: If Grau dies during the Term of this Agreement, American Rebel shall pay to the estate of Grau any earned Salary only through the date of Grau’s death. Other death benefits, if any, will be determined in accordance with the terms of American Rebel’s benefit plans and programs. 

 

6.4 For Cause: If this Agreement is terminated by American Rebel for Cause, Grau shall be entitled to receive Grau’s Salary only through the date of termination.  

 

For purposes of this Agreement, “Cause” shall mean:

 

(i)any act of dishonesty or fraud with respect to American Rebel;  

 

(ii)Grau’s conviction of a felony, a crime involving moral turpitude or other act causing material harm to American Rebel’s standing and reputation;  

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(iii)Grau’s continued material failure to perform Grau’s duties to American Rebel after ten (10) business days’ written notice thereof to Grau; or 

 

(iv)gross negligence or willful misconduct by Grau with respect to American Rebel.  

 

American Rebel shall provide Grau, within ten (10) business days of becoming aware of a “For Cause” breach, written notice, which shall include written documentation, if any, of the “For Cause” breach, as defined above. Upon receipt of the written notice, Grau shall have thirty (30) calendar days to respond to American Rebel’s notice and attempt to cure or resolve the “For Cause” breach. If after that 30 day period, in the judgment of the Board, the “For Cause” breach still exists, then termination shall become effective immediately.

 

6.5 Without Cause Prior to Change of Control: If American Rebel terminates Grau’s employment without Cause prior to a Change of Control, Grau shall be entitled to receive a lump sum payment equal to twelve (12) months Salary plus his prorated Bonus through the date of termination. Further, all unvested stock or options held by Grau shall immediately vest and become exercisable for the full term set forth in such stock option or equity award agreements. To the extent Grau elects to continue his group health coverage pursuant to COBRA following his termination of employment, then Grau shall be eligible to continue such coverage for himself and his dependents (if applicable), at American Rebel’s expense, for a period of twelve (12) months at the same cost as if Grau were still an employee of American Rebel. To the extent that American Rebel finds it undesirable to cover Grau under its group health plan, American Rebel shall provide Grau (at American Rebel’s expense) with the same level of coverage under an individual policy or policies. Grau expressly agrees and understands that, under such circumstances, he shall be entitled only to the payments recited herein, including any prorated Bonus through the date of termination, and he shall not be entitled to any further compensation of any kind through the Term of the Agreement. 

 

6.6 Change of Control Severance: If American Rebel terminates Grau’s employment without Cause within twelve (12) months after a Change of Control, or Grau resigns his employment with Good Reason within twelve (12) months after a Change of Control, Grau shall be entitled to receive a lump sum payment equal to twelve (12) months Salary plus 100% of his prior year’s Bonus. Further, all stock options or equity awards granted by American Rebel shall immediately vest and become exercisable for the full term set forth in such stock option or equity award agreements. To the extent Grau elects to continue his group health coverage pursuant to COBRA following his termination of employment, then Grau shall be eligible to continue such coverage for himself and his dependents (if applicable), at American Rebel’s expense, for a period of twelve (12) months at the same cost as if Grau were still an employee of American Rebel. To the extent that American Rebel finds it undesirable to cover Grau under its group health plan, American Rebel shall provide Grau (at American Rebel’s expense) with the same level of coverage under an individual policy or policies. 

 

6.7 No Mitigation: Grau shall not be required to mitigate the amount of any payment or benefit contemplated by this Agreement, nor shall any such payment or benefit be reduced by any earnings or benefits Grau may receive from any other source. 

 

6.8 Effect of Termination on Unused Vacation Time and Other Benefits: Upon the termination of this Agreement, unless termination is for Cause, Grau shall also have the right to receive any accrued but unused vacation time for that current fiscal year, and any benefits vested under the terms of any applicable benefit plans. 

 

6.9 Time of Payment: Any amounts payable under this Section 6 shall be paid in a single lump sum within 30 days following Grau’s termination of employment. The parties intend that all such payments shall satisfy the short term deferral exception under Treasury Regulation §1.409A-1(b)(4) and therefore shall be exempt from the requirements of Section 409A of the Internal Revenue Code of 1986, as amended. 

 

6.10 Release and Waiver: Notwithstanding the preceding provisions of this Section 6 or any other provision in this Agreement to the contrary, Grau’s entitlement to any post-termination payment under this Agreement shall be subject to and conditioned upon Grau’s execution of a release and waiver of claims on the form reasonably acceptable to American Rebel.  

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7. CHANGE OF CONTROL.  

 

For purposes of this Agreement a “Change of Control” shall mean:

 

(i)The consummation of a merger or consolidation of American Rebel with or into another entity or any other corporate reorganization, if more than 50% of the combined voting power of the continuing or surviving entity’s securities outstanding immediately after such merger, consolidation or other reorganization is owned by persons who were not stockholders of American Rebel immediately prior to such merger, consolidation or other reorganization;  

 

(ii)the sale, transfer or other disposition of all or substantially all of American Rebel’s assets; or 

 

(iii)The date that 40% or more of the current members of the Board of Directors as of the date of this Agreement are replaced by directors who are not currently members of the Board of Directors. 

 

8. TRADE SECRETS AND CONFIDENTIALITY. 

 

8.1 Nondisclosure: Without the prior written consent of American Rebel, Grau shall not, at any time, either during or after the term of this Agreement, directly or indirectly, divulge or disclose to any person, firm, association, or corporation, or use for Grau’s own benefit, gain, or otherwise, any customer lists, plans, products, data, results of tests and data, or any other trade secrets or confidential materials or like information (collectively referred to as the “Confidential Information”) of American Rebel and/or its Affiliates, as hereinafter defined, it being the intent of American Rebel, with which intent Grau hereby agrees, to restrict Grau from disseminating or using any like information that is unpublished or not readily available to the general public. 

 

8.1.1 Definition of Affiliate. For purposes of this Agreement, the term “Affiliate” shall mean any entity, individual, firm, or corporation, directly or indirectly, through one or more intermediaries, controlling, controlled by, or under common control with American Rebel. 

 

8.2 Notice of Compelled Disclosure: If, at any time, Grau becomes legally compelled (by deposition, interrogatory, request for documents, subpoena, civil investigative demand, or similar process or otherwise) to disclose any of the Confidential Information, Grau shall provide American Rebel with prompt, prior written notice of such requirement so that American Rebel may seek a protective order or other appropriate remedy and/or waive compliance with the terms of this Agreement. In the event that such protective order or other remedy is not obtained, that American Rebel waives compliance with the provisions hereof, Grau agrees to furnish only that portion of the Confidential Information which Grau is advised by written opinion of counsel is legally required and exercise Grau’s best efforts to obtain assurance that confidential treatment will be accorded such Confidential Information. In any event, Grau shall not oppose action by American Rebel to obtain an appropriate protective order or other reliable assurance that confidential treatment will be accorded the Confidential Information. 

 

8.3 Assurance of Compliance: Grau agrees to represent to American Rebel, in writing, at any time that American Rebel shall reasonably request, that Grau has complied with the provisions of this section, or any other section of this Agreement. 

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9. NON-COMPETITION AND NON-SOLICITATION.  

 

9.1 Covenant Not To Compete. Grau acknowledges and agrees that in consideration of and reliance upon his employment, American Rebel shall allow Grau access to American Rebel’s proprietary information and data, including but not limited to processes, suppliers, present and future business plans, marketing strategies, marketing channels, distributors, budgets, manufacturers, investors and stockholders. Grau acknowledges and agrees that any and all such information and data could be used to the competitive disadvantage of American Rebel. Accordingly, for the term of this Agreement and for a period of twelve (12) months following the termination of this Agreement (except in the case of termination of this Agreement pursuant to Section 6 because of a Change of Control or any Business Combination or any termination of this Agreement (without cause)), Grau shall not, without the express written consent of American Rebel, directly or indirectly in any manner, including without limitation by employment, contract, consultation, investment (either directly or beneficially) assist any person or entity in engaging in any competition with American Rebel. The term “engaging in competition” as used herein shall be deemed to be used in its ordinary meaning and sense and shall include engaging in, assisting or have an interest in, or entering the employment of or acting as an agent, advisor or consultant for, any person or entity which is engaged in, or will be engaged in, the development, manufacture, supplying or sale of a product, process, service or development which is competitive with a product, process, service or development on which American Rebel has expended resources and on which Grau worked or with respect to which Grau has or had access to Confidential Information while at Company. Upon the Effective Date, Grau agrees that the geographical scope of this covenant not to compete shall be North America.  

 

9.2 Acknowledgment Regarding Restrictions. Grau recognizes and agrees that the restraints contained in Section 9.1, including the geographic scope thereof in light of American Rebel’s marketing efforts, are reasonable and enforceable in view of American Rebel’s legitimate interests in protecting its Confidential Information and customer goodwill and the limited scope of the restrictions in Section 9.1. 

 

9.3 Enforcement in Equity. Grau acknowledges and agrees that in the event that there is a breach of the covenant not to compete or of the non-solicitation covenant set forth herein, that American Rebel has no adequate remedy at law. Accordingly, the parties agree that American Rebel may enforce these covenants in equity by way of injunctive relief, both temporary and permanent. The exclusive jurisdiction and venue for any such actions shall be the District Court of Davidson County, Tennessee and Grau irrevocably consents to the personal jurisdiction of that court for such purposes. American Rebel shall not be deemed stopped from combining a claim for injunctive relief with a claim for money damages in the same action. In the event that American Rebel is the prevailing party in any such action, they shall be entitled to recover their reasonable attorney’s fees as part of the judgment in the action. 

 

9.4 Non-Solicitation; Agreement not to Hire/be Hired. Grau understands and appreciates that American Rebel invests a tremendous amount of time, energy, resources and expertise in the training and education of its employees to be able to operate its operations. Further, Grau understands that in the event an employee of American Rebel or any of its operating subsidiaries, is enticed to leave, then American Rebel shall be damaged in an amount the Parties are not capable of calculating at the present time. Therefore, Grau agrees, that during any non-compete period set forth above and continuing for an additional six (6) month period, that he will not offer employment or contractor status to any employee or contractor or affiliated person of American Rebel, or accept employment or contractor status from any employee or contractor or affiliated person of American Rebel or its operating subsidiaries, nor to allow any person or entity affiliated with Grau to offer such employment status with Grau or any other concern, venture or entity with whom Grau may be employed by, associated or hold a more than five percent (5%) ownership position in. 

 

10. RETURN OF AMERICAN REBEL PROPERTY. Grau agrees that upon any termination of his employment, Grau shall return to American Rebel within a reasonable time not to exceed forty-eight (48) hours, any of American Rebel’s property in his possession or under his control, including but not limited to, all lists, books, records, data, and other information (including all copies thereof in whatever form or media) of every kind relating to or connected with American Rebel or its Affiliates and their activities, business and customers, computer/office automation equipment, records and names, addresses, and other information with regard to customers or potential customers of American Rebel with whom Grau has had contact or done business. 

 

11. RELATIONSHIP OF PARTIES. The parties intend that this Agreement create an Employee-Employer relationship between the parties. 

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12. NOTICES. All notices, required and demands and other communications hereunder must be in writing and shall be deemed to have been duly given when personally delivered or when placed in the United States Mail and forwarded by Registered or Certified Mail, Return Receipt Requested, postage prepaid, or when forwarded via reputable overnight carrier, addressed to the party to whom such notice is being given at the following address: 

 

As to American Rebel:American Rebel Holdings, Inc. 

718 Thompson Lane, Ste 108-199

Nashville, Tennessee 37204

Attn: Board of Directors

 

As to Grau:Doug Grau 

805 Melville Drive

Nashville, TN 37204

 

Address Change: Any party may change the address(es) at which notices to it or him, as the case may be, are to be sent by giving the notice of such change to the other parties in accordance with this Section 12. 

 

13. MISCELLANEOUS. 

 

13.1 Entire Agreement: This Agreement and the Exhibits hereto contain the entire agreement of the parties. This Agreement may not be altered, amended or modified except in writing duly executed by the parties. 

 

13.2 Assignment: Neither party, without the written consent of the other party, can assign this Agreement. 

 

13.3 Binding: This Agreement shall be binding upon and inure to the benefit of the parties, their personal representative, successors and assigns. 

 

13.4 No Waiver: The waiver of the breach of any covenant or condition herein shall in no way operate as a continuing or permanent waiver of the same or similar covenant or condition. 

 

13.5 Severability: If any provision of this Agreement is held to be invalid or unenforceable for any reason, the remaining provisions will continue in full force without being impaired or invalidated in any way. The parties hereto agree to replace any invalid provision with at valid provision which most closely approximates the intent of the invalid provision. 

 

13.6 Interpretation: This Agreement shall not be construed more strongly against any party hereto regardless of which party may have been more responsible for the preparation of Agreement. 

 

13.7 Governing Law: This Agreement shall be governed by and construed under the laws of the State of Tennessee, without reference to the choice of law principles thereof. 

 

13.8 Arbitration: 

 

13.8.1Any controversy, dispute or claim of whatever nature in any way arising out of or relating to Grau’s employment with American Rebel, including, without limitation (except as expressly excluded below in Section 13.8.2) any claims or disputes by Grau against American Rebel, or by American Rebel against Grau, concerning, arising out of or relating to the separation of that employment; any other adverse personnel action by American Rebel; any federal, state or local law, statute or regulation prohibiting employment discrimination or harassment; any public policy; any American Rebel disciplinary action; any American Rebel decision regarding a American Rebel policy or practice, including but not limited to Grau’s compensation or other benefits; and any other claim for personal, emotional, physical or economic injury (individually or collectively, “Covered Claims”) shall be resolved, at the request of any party to this Agreement, by final and binding arbitration in Las Vegas, Nevada before Judicial Arbitration Mediation Services (“JAMS”) in accordance with JAMS’ then-current policies and procedures for arbitration of employment disputes. All costs for such arbitration, including but not limited to Grau’s attorney’s fees, professional fees, witness fees or any other costs, expenses, or fees related to the arbitration, regardless of the party bringing the action, shall be borne by American Rebel. 

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13.8.2The only claims or disputes excluded from binding arbitration under this Agreement are the following: any claim by Grau for workers’ compensation benefits or for benefits under an American Rebel plan that provides its own arbitration procedure; and any claim by either party for equitable relief, including but not limited to, a temporary restraining order, preliminary injunction or permanent injunction against the other party. 

 

13.8.3This agreement to submit all Covered Claims to binding arbitration in no way alters the exclusivity of Grau’s remedy under Section 6.5 in the event of any termination without Cause or the exclusivity of Grau’s remedy under Section 6.4 in the event of any termination for Cause, and does not require American Rebel to provide Grau with any type of progressive discipline. 

 

13.9 Taxes: American Rebel is authorized to withhold from any payment or benefit provided hereunder, the amount of withholding taxes due any federal, state or local authority in respect of such benefit or payment and to take such other action as may be necessary in the opinion of American Rebel to satisfy all obligations for the payment of such withholding taxes. In the event American Rebel does not make such deductions or withholdings, Grau shall indemnify American Rebel for any amounts paid with respect to any such taxes, together with any interest, penalties and related expenses thereto. Grau acknowledges that no oral or written representation of fact or opinion has been made to him by American Rebel or its attorneys regarding the tax treatment or consequences of any payment made under this Agreement. Grau acknowledges and agrees that to the extent any liability or responsibility exists for Grau’s federal, state and local income or other taxes, such liability or responsibility rests solely with his. Grau further agrees to indemnify and hold harmless American Rebel in connection with any liability incurred by American Rebel in connection with any tax or taxes for which Grau is responsible. 

 

13.10 Section 409A of the Internal Revenue Code: To the extent applicable, this Agreement shall be interpreted, construed and operated in accordance with the Section 409A of the Internal Revenue Code, and the Treasury regulations and other guidance issued thereunder. Any reference to termination of employment, severance from employment or similar terms shall mean and be interpreted as a “separation from service” as defined (as defined in Treasury Regulation §1.409A-1(h)). If on the date of Grau’s separation from service with American Rebel, Grau is a specified employee (as defined in Code Section 409A and Treasury Regulation §1.409A-1(i)), no payment constituting the “deferral of compensation” within the meaning of Treasury Regulation §1.409A-1(b) and after application of the exemptions provided in Treasury Regulation §§1.409A-1(b)(4) and 1.409A-1(b)(9)(iii) shall be made to Grau at any time during the six (6) month period following Grau’s separation from service, and any such amounts shall instead be paid in a lump sum on the first payroll payment date following expiration of such six (6) month period. Any obligation of American Rebel to reimburse Grau for expenses incurred during any taxable year of Grau shall not affect the expenses eligible for reimbursements in any other taxable year. Further, such reimbursement of expenses shall be made on or before the last day of Grau’s taxable year following the taxable year in which the expense was incurred. 

 

13.11 Titles: Titles to the sections of this Agreement are solely for the convenience of the parties and shall not be used to explain, modify, simplify, or aid in the interpretation of the provisions of this Agreement. 

 

13.12 Counterparts: This Agreement may be executed in counterparts, each of which shall be deemed an original, but together which shall constitute one and the same instrument. 

 

 

SIGNATURE PAGE TO FOLLOW

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first written above.

 

THIS AGREEMENT CONTAINS AN ARBITRATION CLAUSE.

 

American Rebel:	American Rebel Holdings, Inc.
	a Nevada corporation
	By:	/s/ Doug Grau
		Doug Grau, President
Ross:
		/s/ Charles A. Ross, Jr.
		Charles A. Ross, Jr.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Signature Page to Employment Agreement

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EXHIBIT A

 

AMERICAN REBEL HOLDINGS INC

 

2021 LONG-TERM STOCK INCENTIVE PLAN

 

1. Purpose 

 

The American Rebel Holdings, Inc. 2021 Long-Term Stock Incentive Plan is intended to promote the best interests of American Rebel Holdings, Inc. (the “Corporation”) and its stockholders by (i) assisting the Corporation and its Affiliates in the recruitment and retention of persons with ability and initiative, (ii) providing an incentive to such persons to contribute to the growth and success of the Corporation’s businesses by affording such persons equity participation in the Corporation and (iii) associating the interests of such persons with those of the Corporation and its Affiliates and stockholders.

 

2. Definitions 

 

As used in this Plan the following definitions shall apply:

 

A.“Affiliate” means (i) any Subsidiary, (ii) any Parent, (iii) any corporation, or trade or business (including, without limitation, a partnership, limited liability company or other entity) which is directly or indirectly controlled fifty percent (50%) or more (whether by ownership of stock, assets or an equivalent ownership interest or voting interest) by the Corporation or one of its Affiliates, and (iv) any other entity in which the Corporation or any of its Affiliates has a material equity interest and which is designated as an “Affiliate” by resolution of the Committee. 

 

B.“Award” means any Option or Stock Award granted hereunder. 

 

C.“Board” means the Board of Directors of the Corporation. 

 

D.“Cause” means: (i) conduct involving a felony criminal offense under U. S. federal or state law or an equivalent violation of the laws of any other country; (ii) dishonesty, fraud, self-dealing or material violations of civil law in the course of fulfilling the Participant’s employment or other assigned duties on behalf of the Corporation; (iii) breach of any confidentiality, employment, or other written agreement with the Corporation; or (iv) willful misconduct injurious to the Corporation or any of its Subsidiaries or Affiliates as shall be determined by the Committee. 

 

E.“Code” means the Internal Revenue Code of 1986, and any amendments thereto. 

 

F.“Committee” means the Board or any Committee of the Board to which the Board has delegated any responsibility for the implementation, interpretation or administration of this Plan. As of the date of the Plan, the Board has initially delegated responsibility for the administration of the Plan to the Corporation’s entire Board.  

 

G.“Common Stock” means the common stock, $0.001 par value, of the Corporation.  

 

H.“Consultant” means (i) any person performing consulting or advisory services for the Corporation or any Affiliate, or (ii) a director of an Affiliate. 

 

I.“Corporation” means American Rebel Holdings, Inc., a Nevada corporation.  

 

J.“Corporation Law” means the Nevada General Corporation Law.  

 

K.“Deferral Period” means the period of time during which Deferred Shares are subject to deferral limitations under Section 7.D of this Plan.  

 

L.“Deferred Shares” means an award pursuant to Section 7.D of this Plan of the right to receive shares of Common Stock at the end of a specified Deferral Period. 

 

M.“Director” means a member of the Board.  

 

N.“Eligible Person” means an employee of the Corporation or an Affiliate (including a corporation that becomes an Affiliate after the adoption of this Plan), a Director or a Consultant to the Corporation or an Affiliate (including a corporation that becomes an Affiliate after the adoption of this Plan). 

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O.“Exchange Act” means the Securities Exchange Act of 1934, as amended.  

 

P.“Fair Market Value” means, on any given date, the current fair market value of the shares of Common Stock as determined as follows: 

 

(i)If the Common Stock is traded on a national securities exchange, the closing price for the day of determination as quoted on such market or exchange, including the NASDAQ Global Market or NASDAQ Capital Market, or the OTC Bulletin Board, whichever is the primary market or exchange for trading of the Common Stock or if no trading occurs on such date, the last day on which trading occurred, or such other appropriate date as determined by the Committee in its discretion, as reported in The Wall Street Journal or such other source as the Committee deems reliable; 

 

(ii)If the Common Stock is regularly quoted by a recognized securities dealer but selling prices are not reported, its Fair Market Value shall be the mean between the high and the low asked prices for the Common Stock for the day of determination; or 

 

(iii)In the absence of an established market for the Common Stock, Fair Market Value shall be determined by the Committee in good faith. 

 

(iv)“Incentive Stock Option” means an Option (or portion thereof) intended to qualify for special tax treatment under Section 422 of the Code. 

 

(v)“Nonqualified Stock Option” means an Option (or portion thereof) which is not intended or does not for any reason qualify as an Incentive Stock Option. 

 

(vi)“Option” means any option to purchase shares of Common Stock granted under this Plan. 

 

(vii)“Parent” means any corporation (other than the Corporation) in an unbroken chain of corporations ending with the Corporation if each of the corporations (other than the Corporation) owns stock possessing at least fifty percent (50%) of the total combined voting power of all classes of stock in one of the other corporations in such chain.  

 

(viii)“Participant” means an Eligible Person who (i) is selected by the Committee or an authorized officer of the Corporation to receive an Award and (ii) is party to an agreement setting forth the terms of the Award, as appropriate.  

 

(ix)“Performance Agreement” means an agreement described in Section 8 of this Plan. 

 

(x)“Performance Objectives” means the performance objectives established pursuant to this Plan for Participants who have received grants of Performance Shares or, when so determined by the Committee, Stock Awards. Performance Objectives may be described in terms of Corporation-wide objectives or objectives that are related to the performance of the individual Participant or the Affiliate, subsidiary, division, department or function within the Corporation or Affiliate in which the Participant is employed or has responsibility. Any Performance Objectives applicable to Awards to the extent that such an Award is intended to qualify as “performance-based compensation” under Section 162(m) of the Code shall be limited to specified levels of or increases in the Corporation’s or a business unit’s return on equity, earnings per share, total earnings, earnings growth, return on capital, return on assets, economic value added, earnings before interest and taxes, earnings before interest, taxes, depreciation and amortization, sales growth, gross margin return on investment, increase in the Fair Market Value of the shares, share price (including but not limited to growth measures and total stockholder return), net operating profit, cash flow (including, but not limited to, operating cash flow and free cash flow), cash flow return on investments (which equals net cash flow divided by total capital), internal rate of return, increase in net present value or expense targets. The Awards intended to qualify as “Performance Based Compensation” under Section 162(m) of the Code shall be pre-established in accordance with applicable regulations under Section 162(m) of the Code and the determination of attainment of such goals shall be made by the Committee. If the Committee determines that a change in the business, operations, corporate structure or capital structure of the Corporation (including an event described in Section 9), or the manner in which it conducts is business, or other events or circumstances render the Performance Objectives unsuitable, the Committee may modify such Performance Objectives or the related minimum acceptable level of achievement, in whole or in part, as the Committee deems appropriate and equitable; provided, however, that no such modification shall be made to an Award intended to qualify as performance-based compensation under Section 162(m) of the Code unless the Committee determines that such modification will not result in loss of such qualification or the Committee determines that loss of such qualification is in the best interests of the Corporation. 

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(xi)“Performance Period” means a period of time established under Section 8 of this Plan within which the Performance Objectives relating to a Performance Share or Stock Award are to be achieved. 

 

(xii)“Performance Share” means a bookkeeping entry that records the equivalent of one share of Common Stock awarded pursuant to Section 8 of this Plan. 

 

(xiii)“Plan” means this American Rebel Holdings, Inc. 2021 Long-term Stock Incentive Plan. 

 

(xiv)“Repricing” means, other than in connection with an event described in Section 9 of this Plan, (i) lowering the exercise price of an Option or Stock Appreciation Right after it has been granted or (ii) canceling an Option or Stock Appreciation Right at a time when the exercise price exceeds the then Fair Market Value of the Common Stock in exchange for another Option or Stock Award. 

 

(xv)“Restricted Stock Award” means an award of Common Stock under Section 7.B. 

 

(xvi)“Securities Act” means the Securities Act of 1933, as amended. 

 

(xvii)“Stock Award” means a Stock Bonus Award, Restricted Stock Award, Stock Appreciation Right, Deferred Shares, or Performance Shares. 

 

(xviii)“Stock Bonus Award” means an award of Common Stock under Section 7.A. 

 

(xix)“Stock Appreciation Right” means an award of a right of the Participant under Section 7.C to receive a payment in cash or shares of Common Stock (or a combination thereof) based on the increase in Fair Market Value of the shares of Common Stock covered by the award between the date of grant of such award and the Fair Market Value of the Common Stock on the date of exercise of such Stock Appreciation Right. 

 

(xx)“Stock Award Agreement” means an agreement (written or electronic) between the Corporation and a Participant setting forth the specific terms and conditions of a Stock Award granted to the Participant under Section 7. Each Stock Award Agreement shall be subject to the terms and conditions of this Plan and shall include such terms and conditions as the Committee shall authorize. 

 

(xxi)“Stock Option Agreement” means an agreement (written or electronic) between the Corporation and a Participant setting forth the specific terms and conditions of an Option granted to the Participant. Each Stock Option Agreement shall be subject to the terms and conditions of this Plan and shall include such terms and conditions as the Committee shall authorize. 

 

(xxii)“Subsidiary” means any corporation (other than the Corporation) in an unbroken chain of corporations beginning with the Corporation if each of the corporations (other than the last corporation in the unbroken chain) owns stock possessing at least fifty percent (50%) of the total combined voting power of all classes of stock in one of the other corporations in such chain. 

 

(xxiii)“Ten Percent Owner” means any Eligible Person owning at the time an Option is granted more than ten percent (10%) of the total combined voting power of all classes of stock of the Corporation or of a Parent or Subsidiary. An individual shall, in accordance with Section 424(d) of the Code, be considered to own any voting stock owned (directly or indirectly) by or for such Eligible Person’s brothers, sisters, spouse, ancestors and lineal descendants and any voting stock owned (directly or indirectly) by or for a corporation, partnership, estate or trust shall be considered as being owned proportionately by or for its stockholders, partners, or beneficiaries. 

 

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3. Administration 

 

A.Delegation to Board Committee. The Board shall be the sole Committee of this Plan unless the Board delegates all or any portion of its authority to administer this Plan to a Committee formed in the future. To the extent not prohibited by the charter or bylaws of the Corporation, the Board may delegate all or a portion of its authority to administer this Plan to a Committee of the Board appointed by the Board and constituted in compliance with the applicable Corporation Law. The Committee, when and if established, shall consist solely of two (2) or more Directors who are (i) Non-Employee Directors (within the meaning of Rule 16b-3 under the Exchange Act) for purposes of exercising administrative authority with respect to Awards granted to Eligible Persons who are subject to Section 16 of the Exchange Act; (ii) to the extent required by the rules of the market on which the Corporation’s shares are traded or the exchange on which the Corporation’ shares are listed, “independent” within the meaning of such rules; and (iii) at such times as an Award under this Plan by the Corporation is subject to Section 162(m) of the Code (to the extent relief from the limitation of Section 162(m) of the Code is sought with respect to Awards and administration of the Awards by a committee of “outside directors” is required to receive such relief) “outside directors” within the meaning of Section 162(m) of the Code. 

 

B.Delegation to Officers. The Committee may delegate to one or more officers of the Corporation the authority to grant and administer Awards to Eligible Persons who are not Directors or executive officers of the Corporation; provided that the Committee shall have fixed the total number of shares of Common Stock that may be subject to such Awards. No officer holding such a delegation is authorized to grant Awards to himself or herself. In addition to the Committee, the officer or officers to whom the Committee has delegated the authority to grant and administer Awards shall have all powers delegated to the Committee with respect to such Awards. Such delegation shall be subject to the limitations of Section 157(c) (or any successor provision) of the Corporation Law. 

 

C.Powers of the Committee. Subject to the provisions of this Plan, and in the case of a Committee appointed by the Board, the specific duties delegated to such Committee, the Committee (and the officers to whom the Committee has delegated such authority) shall have the authority: 

 

(i)To construe and interpret all provisions of this Plan and all Stock Option Agreements, Stock Award Agreements and Performance Agreements under this Plan. 

 

(ii)To determine the Fair Market Value of Common Stock. 

 

(iii)To select the Eligible Persons to whom Awards are granted from time to time hereunder. 

 

(iv)To determine the number of shares of Common Stock covered by an Award; to determine whether an Option shall be an Incentive Stock Option or Nonqualified Stock Option; and to determine such other terms and conditions, not inconsistent with the terms of this Plan, of each such Award. Such terms and conditions include, but are not limited to, the exercise price of an Option, purchase price of Common Stock subject to a Stock Award, the time or times when Options or Stock Awards may be exercised or Common Stock issued thereunder, the right of the Corporation to repurchase Common Stock issued pursuant to the exercise of an Option or a Stock Award and other restrictions or limitations (in addition to those contained in this Plan) on the forfeitability or transferability of Options, Stock Awards or Common Stock issued upon exercise of an Option or pursuant to an Award. Such terms may include conditions which shall be determined by the Committee and need not be uniform with respect to Participants. 

 

(v)To accelerate the time at which any Option or Stock Award may be exercised, or the time at which a Stock Award or Common Stock issued under this Plan may become transferable or non-forfeitable. 

 

(vi)To determine whether and under what circumstances an Option may be settled in cash, shares of Common Stock or other property under Section 6.H instead of Common Stock. 

 

(vii)To waive, amend, cancel, extend, renew, accept the surrender of, modify or accelerate the vesting of or lapse of restrictions on all or any portion of an outstanding Award. Except as otherwise provided by this Plan, the Stock Option Agreement, Stock Award Agreement or Performance Agreement or as required to comply with applicable law, regulation or rule, no amendment, cancellation or modification shall, without a Participant’s consent, adversely affect any rights of the Participant; provided, however, that (x) an amendment or modification that may cause an Incentive Stock Option to become a Nonqualified Stock Option shall not be treated as adversely affecting the rights of the Participant and (y) any other amendment or modification of any Stock Option Agreement, Stock Award Agreement or Performance Agreement that does not, in the opinion of the Committee, adversely affect any rights of any Participant, shall not require such Participant’s consent. Notwithstanding the foregoing, the restrictions on the Repricing of Options and Stock Appreciation Rights, as set forth in this Plan, may not be waived. 

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(vii)To prescribe the form of Stock Option Agreements, and Stock Award Agreements and Performance Agreements; to adopt policies and procedures for the exercise of Options or Stock Awards, including the satisfaction of withholding obligations; to adopt, amend, and rescind policies and procedures pertaining to the administration of this Plan; and to make all other determinations necessary or advisable for the administration of this Plan. The Award’s effectiveness will not be dependent on any signature unless specifically so provided in the Award Agreement. Awards shall generally be subject to a vesting period and no more than 50% of Awards to executives and directors may have a vesting period of less than one year; provided, however, that vesting may accelerate in the event of change in control and certain other events as set forth herein, and in the events of death, disability or retirement, as will be specified in the Award Agreement. 

 

The express grant in this Plan of any specific power to the Committee shall not be construed as limiting any power or authority of the Committee; provided that the Committee or any committee of the Board may not exercise any right or power reserved to the Board. Any decision made, or action taken, by the Committee or in connection with the administration of this Plan shall be final, conclusive and binding on all persons having an interest in this Plan.

 

4. Eligibility 

 

A.Eligibility for Awards. Awards, other than Incentive Stock Options, may be granted to any Eligible Person selected by the Committee. Incentive Stock Options may be granted only to employees of the Corporation or a Parent or Subsidiary. 

 

B.Eligibility of Consultants. A Consultant shall be an Eligible Person only if the offer or sale of the Corporation’s securities would be eligible for registration on Form S-8 Registration Statement because of the identity and nature of the service provided by such person, unless the Corporation determines that an offer or sale of the Corporation’s securities to such person will satisfy another exemption from the registration under the Securities Act and complies with the securities laws of all other jurisdictions applicable to such offer or sale. 

 

C.Substitution Awards. The Committee may make Awards and may grant Options under this Plan by assumption, in substitution or replacement of performance shares, phantom shares, stock awards, stock options, stock appreciation rights or similar awards granted by another entity (including an Affiliate) in connection with a merger, consolidation, acquisition of property or stock or similar transaction. Notwithstanding any provision of this Plan (other than the maximum number of shares of Common Stock that may be issued under this Plan), the terms of such assumed, substituted, or replaced Awards shall be as the Committee, in its discretion, determines is appropriate. 

 

5. Common Stock Subject to Plan 

 

A.Share Reserve and Limitations on Grants. Subject to adjustment as provided in Section 9, the maximum aggregate number of shares of Common Stock that may be (i) issued under this Plan pursuant to the exercise of Options, (ii) issued pursuant to Stock Awards, (iii) covered by Stock Appreciation Rights (without regard to whether payment on exercise of the Stock Appreciation Right is made in cash or shares of Common Stock) and (iv) covered by Performance Shares shall be limited to 10% of the shares of Common Stock outstanding (which equates to 7,549,725 shares as of January 1, 2021), which calculation shall be made on the first trading day of a new fiscal year. The number of shares of Common Stock subject to the Plan shall be subject to adjustment as provided in Section 9. Subject to adjustment as provided in Section 9, and notwithstanding any provision hereto to the contrary, shares subject to the Plan shall include shares forfeited in a prior year as provided herein. For purposes of determining the number of shares of Common Stock available under this Plan, shares of Common Stock withheld by the Corporation to satisfy applicable tax withholding obligations pursuant to Section 10 of this Plan shall be deemed issued under this Plan. No single participant may receive more than 50% of the total shares awarded in any single year, without the approval of a majority of the Board. 

 

B.Reversion of Shares. If an Option or Stock Award is terminated, expires or becomes unexercisable, in whole or in part, for any reason, the unissued or unpurchased shares of Common Stock (or shares subject to an unexercised Stock Appreciation Right) which were subject thereto shall become available for future grant under this Plan. Shares of Common Stock that have been actually issued under this Plan shall not be returned to the share reserve for future grants under this Plan; except that shares of Common Stock issued pursuant to a Stock Award which are forfeited to the Corporation or repurchased by the Corporation at the original purchase price of such shares, shall be returned to the share reserve for future grant under this Plan. 

 

C.Source of Shares. Common Stock issued under this Plan may be shares of authorized and unissued Common Stock or shares of previously issued Common Stock that have been reacquired by the Corporation. 

 

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6. Options 

 

A.Award. In accordance with the provisions of Section 4, the Committee will designate each Eligible Person to whom an Option is to be granted and will specify the number of shares of Common Stock covered by such Option. The Stock Option Agreement shall specify whether the Option is an Incentive Stock Option or Nonqualified Stock Option, the vesting schedule applicable to such Option and any other terms of such Option. No Option that is intended to be an Incentive Stock Option shall be invalid for failure to qualify as an Incentive Stock Option. 

 

B.Option Price. The exercise price per share for Common Stock subject to an Option shall be determined by the Committee, but shall comply with the following: 

 

(i)The exercise price per share for Common Stock subject to an Option shall not be less than one hundred percent (100%) of the Fair Market Value on the date of grant. 

 

(ii)The exercise price per share for Common Stock subject to an Incentive Stock Option granted to a Participant who is deemed to be a Ten Percent Owner on the date such option is granted, shall not be less than one hundred ten percent (110%) of the Fair Market Value on the date of grant. 

 

C.Maximum Option Period. The maximum period during which an Option may be exercised shall be ten (10) years from the date such Option was granted. In the case of an Incentive Stock Option that is granted to a Participant who is or is deemed to be a Ten Percent Owner on the date of grant, such Option shall not be exercisable after the expiration of five (5) years from the date of grant. 

 

D.Maximum Value of Options which are Incentive Stock Options. To the extent that the aggregate Fair Market Value of the Common Stock with respect to which Incentive Stock Options granted to any person are exercisable for the first time during any calendar year (under all stock option plans of the Corporation or any Parent or Subsidiary) exceeds $100,000 (or such other amount provided in Section 422 of the Code), the Options are not Incentive Stock Options. For purposes of this section, the Fair Market Value of the Common Stock will be determined as of the time the Incentive Stock Option with respect to the Common Stock is granted. This section will be applied by taking Incentive Stock Options into account in the order in which they are granted. 

 

E.Nontransferability. Options granted under this Plan which are intended to be Incentive Stock Options shall be nontransferable except by will or by the laws of descent and distribution and during the lifetime of the Participant shall be exercisable by only the Participant to whom the Incentive Stock Option is granted. Except to the extent transferability of a Nonqualified Stock Option is provided for in the Stock Option Agreement or is approved by the Committee, during the lifetime of the Participant to whom the Nonqualified Stock Option is granted, such Option may be exercised only by the Participant. If the Stock Option Agreement so provides or the Committee so approves, a Nonqualified Stock Option may be transferred by a Participant through a gift or domestic relations order to the Participant’s family members to the extent in compliance with applicable securities laws and regulations and provided that such transfer is not a transfer for value (within the meaning of applicable securities laws and regulations). The holder of a Nonqualified Stock Option transferred pursuant to this section shall be bound by the same terms and conditions that governed the Option during the period that it was held by the Participant. No right or interest of a Participant in any Option shall be liable for, or subject to, any lien, obligation, or liability of such Participant. 

 

F.Vesting. Options will vest as provided in the Stock Option Agreement. 

 

G.Exercise. Subject to the provisions of this Plan and the applicable Stock Option Agreement, an Option may be exercised to the extent vested in whole at any time or in part from time to time at such times and in compliance with such requirements as the Committee shall determine. A partial exercise of an Option shall not affect the right to exercise the Option from time to time in accordance with this Plan and the applicable Stock Option Agreement with respect to the remaining shares subject to the Option. An Option may not be exercised with respect to fractional shares of Common Stock. 

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H.Payment. Unless otherwise provided by the Stock Option Agreement, payment of the exercise price for an Option shall be made in cash or a cash equivalent acceptable to the Committee or if the Common Stock is traded on an established securities market, by payment of the exercise price by a broker-dealer or by the Option holder with cash advanced by the broker-dealer if the exercise notice is accompanied by the Option holder’s written irrevocable instructions to deliver the Common Stock acquired upon exercise of the Option to the broker-dealer or by delivery of the Common Stock to the broker-dealer with an irrevocable commitment by the broker-dealer to forward the exercise price to the Corporation. With the consent of the Committee, payment of all or a part of the exercise price of an Option may also be made (i) by surrender to the Corporation (or delivery to the Corporation of a properly executed form of attestation of ownership) of shares of Common Stock that have been held for such period prior to the date of exercise as is necessary to avoid adverse accounting treatment to the Corporation, or (ii) any other method acceptable to the Committee, including without limitation, the withholding of shares receivable upon settlement of the option in payment of the exercise price. If Common Stock is used to pay all or part of the exercise price, the sum of the cash or cash equivalent and the Fair Market Value (determined as of the date of exercise) of the shares surrendered must not be less than the Option price of the shares for which the Option is being exercised. 

 

I.Stockholder Rights. No Participant shall have any rights as a stockholder with respect to shares subject to an Option until the date of exercise of such Option and the certificate for shares of Common Stock to be received on exercise of such Option has been issued by the Corporation. 

 

J.Disposition and Stock Certificate Legends for Incentive Stock Option Shares. A Participant shall notify the Corporation of any sale or other disposition of Common Stock acquired pursuant to an Incentive Stock Option if such sale or disposition occurs (i) within two years of the grant of an Option or (ii) within one year of the issuance of the Common Stock to the Participant. Such notice shall be in writing and directed to the Chief Financial Officer of the Corporation or is his/her absence, the Chief Executive Officer. The Corporation may require that certificates evidencing shares of Common Stock purchased upon the exercise of Incentive Stock Option issued under this Plan be endorsed with a legend in substantially the following form: 

 

THE SHARES EVIDENCED BY THIS CERTIFICATE MAY NOT BE SOLD OR TRANSFERRED PRIOR TO __, 20__, IN THE ABSENCE OF A WRITTEN STATEMENT FROM THE CORPORATION TO THE EFFECT THAT THE CORPORATION IS AWARE OF THE FACTS OF SUCH SALE OR TRANSFER.

 

The blank contained in this legend shall be filled in with the date that is the later of (i) one year and one day after the date of the exercise of such Incentive Stock Option or (ii) two years and one day after the grant of such Incentive Stock Option.

 

K.No Repricing. In no event shall the Committee permit a Repricing of any Option without the approval of the majority of the Board. 

 

7. Stock Awards 

 

A.Stock Bonus Awards. Each Stock Award Agreement for a Stock Bonus Award shall be in such form and shall contain such terms and conditions (including provisions relating to consideration, vesting, reacquisition of shares following termination, and transferability of shares) as the Committee shall deem appropriate. The terms and conditions of Stock Award Agreements for Stock Bonus Awards may change from time to time, and the terms and conditions of separate Stock Bonus Awards need not be identical. 

 

B.Restricted Stock Awards. Each Stock Award Agreement for a Restricted Stock Award shall be in such form and shall contain such terms and conditions (including provisions relating to purchase price, consideration, vesting, reacquisition of shares following termination, and transferability of shares) as the Committee shall deem appropriate. The terms and conditions of the Stock Award Agreements for Restricted Stock Awards may change from time to time, and the terms and conditions of separate Restricted Stock Awards need not be identical. Vesting of any grant of Restricted Stock Awards may be further conditioned upon the attainment of Performance Objectives established by the Committee in accordance with the applicable provisions of Section 8 of this Plan regarding Performance Shares. 

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C.Stock Appreciation Rights. Each Stock Award Agreement for Stock Appreciation Rights shall be in such form and shall contain such terms and conditions (including provisions relating to vesting, reacquisition of shares following termination, and transferability of shares) as the Committee shall deem appropriate. The terms and conditions of Stock Appreciation Rights may change from time to time, and the terms and conditions of separate Stock Appreciation Rights need not be identical. No Stock Appreciation Right shall be exercisable after the expiration of seven (7) years from the date such Stock Appreciation Right is granted. The base price per share for each share of Common Stock covered by an Award of Stock Appreciation Rights shall not be less than one hundred percent (100%) of the Fair Market Value of a share of Common Stock on the date of grant. In no event shall the Committee permit a Repricing of any Stock Appreciation Right without the approval of the stockholders of the Corporation. 

 

D.Deferred Shares. The Committee may authorize grants of Deferred Shares to Participants upon such terms and conditions as the Committee may determine in accordance with the following provisions: 

 

(i)Each grant shall constitute the agreement by the Corporation to issue or transfer shares of Common Stock to the Participant in the future in consideration of the performance of services, subject to the fulfillment during the Deferral Period of such conditions as the Committee may specify. 

 

(ii)Each grant may be made without additional consideration from the Participant or in consideration of a payment by the Participant that is less than the Fair Market Value on the date of grant. 

 

(iii)Each grant shall provide that the Deferred Shares covered thereby shall be subject to a Deferral Period, which shall be fixed by the Committee on the date of grant, and any grant or sale may provide for the earlier termination of such period in the event of a change in control of the Corporation or other similar transaction or event. 

 

(iv)During the Deferral Period, the Participant shall not have any right to transfer any rights under the subject Award, shall not have any rights of ownership in the Deferred Shares and shall not have any right to vote such shares, but the Committee may on or after the date of grant, authorize the payment of dividend or other distribution equivalents on such shares in cash or additional shares on a current, deferred or contingent basis. 

 

(v)Any grant of the vesting thereof may be further conditioned upon the attainment of Performance Objectives established by the Committee in accordance with the applicable provisions of Section 8 of this Plan regarding Performance Shares. 

 

(vi)Each grant shall be evidenced by an agreement delivered to and accepted by the Participant and containing such terms and provisions as the Committee may determine consistent with this Plan. 

 

8. Performance Shares 

 

A.The Committee may authorize grants of Performance Shares, which shall become payable to the Participant upon the achievement of specified Performance Objectives, upon such terms and conditions as the Committee may determine in accordance with the following provisions: 

 

(i)Each grant shall specify the number of Performance Shares to which it pertains, which may be subject to adjustment to reflect changes in compensation or other factors. 

 

(ii)The Performance Period with respect to each Performance Share shall commence on the date established by the Committee and may be subject to earlier termination in the event of a change in control of the Corporation or similar transaction or event. 

 

(iii)Each grant shall specify the Performance Objectives that are to be achieved by the Participant. 

 

(iv)Each grant may specify in respect of the specified Performance Objectives a minimum acceptable level of achievement below which no payment will be made and may set forth a formula for determining the amount of any payment to be made if performance is at or above such minimum acceptable level but falls short of the maximum achievement of the specified Performance Objectives. 

 

(v)Each grant shall specify the time and manner of payment of Performance Shares that shall have been earned, and any grant may specify that any such amount may be paid by the Corporation in cash, shares of Common Stock or any combination thereof and may either grant to the Participant or reserve to the Committee the right to elect among those alternatives. 

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(vi)Any grant of Performance Shares may specify that the amount payable with respect thereto may not exceed a maximum specified by the Committee on the date of grant. 

 

(vii)Any grant of Performance Shares may provide for the payment to the Participant of dividend or other distribution equivalents thereon in cash or additional shares of Common Stock on a current, deferred or contingent basis. 

 

(viii)If provided in the terms of the grant and subject to the requirements of Section 162(m) of the Code (in the case of Awards intended to qualify for exception therefrom), the Committee may adjust Performance Objectives and the related minimum acceptable level of achievement if, in the sole judgment of the Committee, events or transactions have occurred after the date of grant that are unrelated to the performance of the Participant and result in distortion of the Performance Objectives or the related minimum acceptable level of achievement. 

 

(ix)Each grant shall be evidenced by an agreement that shall be delivered to and accepted by the Participant, which shall state that the Performance Shares are subject to all of the terms and conditions of this Plan and such other terms and provisions as the Committee may determine consistent with this Plan. 

 

9. Changes in Capital Structure 

 

A.No Limitations of Rights. The existence of outstanding Awards shall not affect in any way the right or power of the Corporation or its stockholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Corporation’s capital structure or its business, or any merger or consolidation of the Corporation, or any issuance of bonds, debentures, preferred or prior preference stock ahead of or affecting the Common Stock or the rights thereof, or the dissolution or liquidation of the Corporation, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise. 

 

B.Changes in Capitalization. If the Corporation shall effect a subdivision or consolidation of shares or other capital readjustment, the payment of a stock dividend, or other increase or reduction of the number of shares of the Common Stock outstanding, without receiving consideration therefore in money, services or property, then (i) the number, class, and per share price of shares of Common Stock subject to outstanding Options and other Awards hereunder and (ii) the number and class of shares then reserved for issuance under this Plan and the maximum number of shares for which Awards may be granted to a Participant during a specified time period shall be appropriately and proportionately adjusted. The conversion of convertible securities of the Corporation shall not be treated as effected “without receiving consideration.” The Committee shall make such adjustments, and its determinations shall be final, binding and conclusive. 

 

C.Merger, Consolidation or Asset Sale. If the Corporation is merged or consolidated with another entity or sells or otherwise disposes of substantially all of its assets to another company while Options or Stock Awards remain outstanding under this Plan, unless provisions are made in connection with such transaction for the continuance of this Plan and/or the assumption or substitution of such Options or Stock Awards with new options or stock awards covering the stock of the successor company, or parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and prices, then all outstanding Options and Stock Awards which have not been continued, assumed or for which a substituted award has not been granted shall, whether or not vested or then exercisable, unless otherwise specified in the Stock Option Agreement or Stock Award Agreement, terminate immediately as of the effective date of any such merger, consolidation or sale. 

 

D.Limitation on Adjustment. Except as previously expressly provided, neither the issuance by the Corporation of shares of stock of any class, or securities convertible into shares of stock of any class, for cash or property, or for labor or services either upon direct sale or upon the exercise of rights or warrants to subscribe therefor, or upon conversion of shares or obligations of the Corporation convertible into such shares or other securities, nor the increase or decrease of the number of authorized shares of stock, nor the addition or deletion of classes of stock, shall affect, and no adjustment by reason thereof shall be made with respect to, the number, class or price of shares of Common Stock then subject to outstanding Options or Stock Awards. 

 

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10. Withholding of Taxes 

 

The Corporation or an Affiliate shall have the right, before any certificate for any Common Stock is delivered, to deduct or withhold from any payment owed to a Participant any amount that is necessary in order to satisfy any withholding requirement that the Corporation or Affiliate in good faith believes is imposed upon it in connection with U.S. federal, state, or local taxes, including transfer taxes, as a result of the issuance of, or lapse of restrictions on, such Common Stock, or otherwise require such Participant to make provision for payment of any such withholding amount. Subject to such conditions as may be established by the Committee, the Committee may permit a Participant to (i) have Common Stock otherwise issuable under an Option or Stock Award withheld to the extent necessary to comply with minimum statutory withholding rate requirements, (ii) tender back to the Corporation shares of Common Stock received pursuant to an Option or Stock Award to the extent necessary to comply with minimum statutory withholding rate requirements for supplemental income, (iii) deliver to the Corporation previously acquired Common Stock, (iv) have funds withheld from payments of wages, salary or other cash compensation due the Participant, (v) pay the Corporation or its Affiliate in cash, in order to satisfy part or all of the obligations for any taxes required to be withheld or otherwise deducted and paid by the Corporation or its Affiliate with respect to the Option or Stock Award; or (vi) establish a 10b5-1 trading plan for withheld stock designed to facilitate the sale of stock in connection with the vesting of such shares, the proceeds of which shall be utilized to make all applicable withholding payments in a manner to be coordinated by the Corporation’s Chief Financial Officer.

 

11. Compliance with Law and Approval of Regulatory Bodies 

 

A.General Requirements. No Option or Stock Award shall be exercisable, no Common Stock shall be issued, no certificates for shares of Common Stock shall be delivered, and no payment shall be made under this Plan except in compliance with all applicable federal and state laws and regulations (including, without limitation, withholding tax requirements), any listing agreement to which the Corporation is a party, and the rules of all domestic stock exchanges or quotation systems on which the Corporation’s shares may be listed. The Corporation shall have the right to rely on an opinion of its counsel as to such compliance. Any share certificate issued to evidence Common Stock when a Stock Award is granted or for which an Option or Stock Award is exercised may bear such legends and statements as the Committee may deem advisable to assure compliance with federal and state laws and regulations. No Option or Stock Award shall be exercisable, no Stock Award shall be granted, no Common Stock shall be issued, no certificate for shares shall be delivered, and no payment shall be made under this Plan until the Corporation has obtained such consent or approval as the Committee may deem advisable from regulatory bodies having jurisdiction over such matters. 

 

B.Participant Representations. The Committee may require that a Participant, as a condition to receipt or exercise of a particular award, execute and deliver to the Corporation a written statement, in form satisfactory to the Committee, in which the Participant represents and warrants that the shares are being acquired for such person’s own account, for investment only and not with a view to the resale or distribution thereof. The Participant shall, at the request of the Committee, be required to represent and warrant in writing that any subsequent resale or distribution of shares of Common Stock by the Participant shall be made only pursuant to either (i) a registration statement on an appropriate form under the Securities Act of 1933, which registration statement has become effective and is current with regard to the shares being sold, or (ii) a specific exemption from the registration requirements of the Securities Act of 1933, but in claiming such exemption the Participant shall, prior to any offer of sale or sale of such shares, obtain a prior favorable written opinion of counsel, in form and substance satisfactory to counsel for the Corporation, as to the application of such exemption thereto. 

 

12. General Provisions 

 

A.Effect on Employment and Service. Neither the adoption of this Plan, its operation, nor any documents describing or referring to this Plan (or any part thereof) shall (i) confer upon any individual any right to continue in the employ or service of the Corporation or an Affiliate, (ii) in any way affect any right and power of the Corporation or an Affiliate to change an individual’s duties or terminate the employment or service of any individual at any time with or without assigning a reason therefor or (iii) except to the extent the Committee grants an Option or Stock Award to such individual, confer on any individual the right to participate in the benefits of this Plan. 

 

B.Use of Proceeds. The proceeds received by the Corporation from the sale of Common Stock pursuant to this Plan shall be used for general corporate purposes. 

 

C.Unfunded Plan. This Plan, insofar as it provides for grants, shall be unfunded, and the Corporation shall not be required to segregate any assets that may at any time be represented by grants under this Plan. Any liability of the Corporation to any person with respect to any grant under this Plan shall be based solely upon any contractual obligations that may be created pursuant to this Plan. No such obligation of the Corporation shall be deemed to be secured by any pledge of, or other encumbrance on, any property of the Corporation. 

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D.Rules of Construction. Headings are given to the Sections of this Plan solely as a convenience to facilitate reference. The reference to any statute, regulation, or other provision of law shall be construed to refer to any amendment to or successor of such provision of law. 

 

E.Choice of Law. This Plan and all Stock Option Agreements and Stock Award Agreements entered into under this Plan shall be interpreted under the Corporation Law excluding (to the greatest extent permissible by law) any rule of law that would cause the application of the laws of any jurisdiction other than the Corporation Law. 

 

F.Fractional Shares. The Corporation shall not be required to issue fractional shares pursuant to this Plan. The Committee may provide for elimination of fractional shares or the settlement of such fraction shares in cash. 

 

G.Foreign Employees. In order to facilitate the making of any grant or combination of grants under this Plan, the Committee may provide for such special terms for Awards to Participants who are foreign nationals, or who are employed by the Corporation or any Affiliate outside of the United States, as the Committee may consider necessary or appropriate to accommodate differences in local law, tax policy or custom. Moreover, the Committee may approve such supplements to, or amendments, restatements or alternative versions of, this Plan as it may consider necessary or appropriate for such purposes without thereby affecting the terms of this Plan, as then in effect, unless this Plan could have been amended to eliminate such inconsistency without further approval by the stockholders of the Corporation. 

 

13. Amendment and Termination 

 

The Board may amend or terminate this Plan from time to time; provided, however, stockholder approval shall be required for any amendment that (i) increases the aggregate number of shares of Common Stock that may be issued under this Plan, except as contemplated by Section 5.A or Section 9.B; (ii) changes the class of employees eligible to receive Incentive Stock Options; (iii) modifies the restrictions on Repricings set forth in this Plan; or (iv) is required by the terms of any applicable law, regulation or rule, including the rules of any market on which the Corporation shares are traded or exchange on which the Corporation shares are listed. Except as specifically permitted by this Plan, Stock Option Agreement or Stock Award Agreement or as required to comply with applicable law, regulation or rule, no amendment shall, without a Participant’s consent, adversely affect any rights of such Participant under any Option or Stock Award outstanding at the time such amendment is made; provided, however, that an amendment that may cause an Incentive Stock Option to become a Nonqualified Stock Option shall not be treated as adversely affecting the rights of the Participant. Any amendment requiring stockholder approval shall be approved by the stockholders of the Corporation within twelve (12) months of the date such amendment is adopted by the Board.

 

14. Effective Date of Plan; Duration of Plan 

 

A.This Plan shall be effective upon adoption by the Board, subject to approval within twelve (12) months by the stockholders of the Corporation. In the event that the stockholders of the Corporation shall not approve this Plan within such twelve (12) month period, this Plan shall terminate. Unless and until the Plan has been approved by the stockholders of the Corporation, no Option or Stock Award may be exercised, and no shares of Common Stock may be issued under the Plan. In the event that the stockholders of the Corporation shall not approve the Plan within such twelve (12) month period, the Plan and any previously granted Options or Stock Awards shall terminate. 

 

B.Unless previously terminated, this Plan will terminate ten (10) years after the earlier of (i) the date this Plan is adopted by the Board, or (ii) the date this Plan is approved by the stockholders, except that Awards that are granted under this Plan prior to its termination will continue to be administered under the terms of this Plan until the Awards terminate or are exercised. 

 

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IN WITNESS WHEREOF, the Corporation has caused this Plan to be executed by a duly authorized officer as of the date of adoption of this Plan by the Board of Directors.

 

AMERICAN REBEL HOLDINGS, INC.

 

By: /s/ Charles A. Ross, Jr.

Charles A. Ross, Jr., CEO