EXHIBIT 10.23
▇▇▇▇▇▇ OIL AND GAS COMPANY
EMPLOYMENT AGREEMENT
FOR
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This Employment Agreement (the "Agreement") is entered into as of December
____, 2000 by ▇▇▇▇▇▇ OIL AND GAS COMPANY, a Delaware corporation ("Company") and
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ("Employee"), a resident of Texas, whose address is ▇▇▇▇
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In consideration of the promises below, the parties agree as follows.
1. Title. Employee shall hold the title of Vice President and General
Counsel.
2. Duties.
2.1 General Duties. Employee shall undertake and render services as
may from time to time be assigned to him by the Chief Executive Officer. The
duties shall be reasonably consistent with Employee's experiences.
2.2 Outside Activities. Employee shall devote his full time to the
performance of his duties, and agrees that his first duty of loyalty is to
Company. Except with the express written consent of the Board of Directors,
Employee shall not, directly or indirectly, alone or as a member of any
partnership, or as an officer, director or employee of any other corporation,
partnership or other organization, be actively engaged in any other duties or
pursuits which interfere or compete with the performance of his duties under
this Agreement.
3. Term. This Agreement shall commence on January 1, 2001 and continue in
force until December 31, 2002 (the "Employment Period") unless sooner terminated
by either party pursuant to Section 5.
4. Compensation. As payment in full for services rendered to Company,
Employee shall be entitled to receive from Company, and Company shall pay to
Employee, salary and benefits as follows.
4.1 Salary. Company shall initially pay to Employee base salary at a
rate of $200,000 per annum ("Base Salary") payable bi-weekly or at such other
time or times as Company may allow or provide to other similarly situated
employees in accordance with policies adopted from time to time by the Board of
Directors. Base Salary for any partial period of employment shall be prorated.
All compensation shall be subject to deductions and/or Federal and State
withholding for taxes if applicable.
4.2 Annual Incentive Compensation. Employee shall be entitled to an
annual bonus (the "Annual Bonus") as determined by the Compensation Committee of
the Company's Board of Directors (the "Compensation Committee").
4.3 Equity Compensation. As of the Commencement Date, the Company
shall issue stock options (the "Options") to purchase shares of the Company's
common stock under
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the Company's Stock Option Plan. The initial grant shall be Options to purchase
115,000 shares of the Company's stock subject to the Company's three (3) year
vesting schedule.
4.4 Fringe Benefits. Employee shall be entitled to annual vacation
of four (4) weeks per year and to receive employee and fringe benefits including
but not limited to any compensation plan such as an incentive stock option,
restricted stock or stock purchase plan or any employee benefit plan such as a
thrift, pension, profit sharing, medical disability, accident, plan program or
policy (the Company's "Plans") as Company may allow or provide to other
similarly situated employees in accordance with policies adopted from time to
time by the Board of Directors.
4.5 Expenses Reimbursement. Employee shall be reimbursed for all
direct, out-of-pocket business expenses incurred by him in connection with his
employment (including, without limitation, expenses for travel and entertainment
incurred in conducting or promoting business for the Company), upon timely
submission by the Employee of receipts and other documentation, and in
accordance with the normal expense reimbursement policy of the Company.
4.6 Sickness and Disability. Except as set forth in Section 5.2,
Employee shall receive full compensation for any period of illness or incapacity
during the term of this Agreement.
4.7 Holidays. Employee shall be entitled to holidays recognized as
State and/or National holidays and as Company may allow or provide in accordance
with policies adopted from time to time by the Board of Directors.
5. Termination of Employment. The following provisions shall apply in the
event of termination of Employee's employment for any reason.
5.1 Right to Terminate by Company. Company may terminate Employee's
Agreement, by action of its Board of Directors, immediately upon written notice
of termination for Cause or upon thirty (30) days notice for any other reason.
The term "Cause" when referring to termination by Company means only the
following and any other termination shall be without Cause: (i) any act of
personal dishonesty taken by the Employee in connection with his
responsibilities as an Employee which is intended to result in substantial
personal enrichment to the Employee; (ii) Employee's conviction of a felony
which the Board responsibly believes has had or will have a material detrimental
effect on the Company's reputation or business; (iii) a willful act by the
Employee which constitutes misconduct and is injurious to the Company; and (iv)
continued willful violations by the Employee of the Employee's obligations to
the Company after there has been delivered to Employee a written demand for
performance from the Company which describes the basis for the Company's belief
that the Employee has not substantially performed his duties.
5.2 Termination for Death or Disability. Employee's employment shall
terminate upon the earliest of the events specified below:
(i) the death of Employee;
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(ii) the date of termination specified in a written notice of
termination by reason of physical or mental condition of Employee which shall
substantially incapacitate him from performing his principal duties delivered by
the Company to Employee at least 30 days prior to the date specified in the
notice, which shall be any date after the expiration of any 120 consecutive days
during which Employee shall be unable, by reason of his disability, to perform
his principal duties, provided however, that such notice shall be null and void
if Employee fully resumes the performance of his duties under this Agreement
prior to the date of termination set forth in the notice.
5.3 Termination by Employee. If an Involuntary Termination has
occurred, Employee shall be entitled to terminate his employment and to receive
compensation equal to such compensation provided in Section 6.3. If Employee
terminates his employment for any reason other than death, disability or
Involuntary Termination, then Employee shall provide the Company with thirty
(30) days prior notice and Employee shall be paid his compensation until the
effective date of termination.
6. Change of Control and Involuntary Termination.
6.1 Definition of Terms. The following terms referred to in this
Agreement shall have the following meanings:
(i) Change of Control. "Change of Control" shall mean the occurrence
of any of the following events:
(a) the approval by shareholders of the Company of a merger or
consolidation of the Company with any other corporation, other than a
merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting
securities of the surviving entity) more than fifty percent (50%) of the
total voting power represented by the voting securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation;
(b) any approval by the shareholders of the Company of a plan
of complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the Company's
assets;
(c) any "person" (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended) becoming the
"beneficial owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing 25% or more of the
total voting power represented by the Company's then outstanding voting
securities; or
(d) a change in the composition of the Board, as a result of
which fewer than a majority of the directors are Incumbent Directors.
"Incumbent Directors" shall mean directors who either (A) are directors of
the Company as of the date hereof, or (B) are elected, or nominated for
election, to the Board with the affirmative votes of at least a majority
of those directors whose election or nomination was not in connection
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with any transaction described in subsections (a), (b) or (c) or in
connection with an actual or threatened proxy contest relating to the
election of directors of the Company.
(ii) Involuntary Termination. "Involuntary Termination" shall mean
(a) without the Employee's express written consent, a significant reduction of
the Employee's duties, position or responsibilities relative to the Employee's
duties, position or responsibilities in effect immediately prior to such
reduction, or the removal of the Employee from such position, duties and
responsibilities, unless the Employee is provided with comparable duties,
position and responsibilities; (b) without the Employee's express written
consent, a substantial reduction, without good business reasons, of the
facilities and perquisites (including office space and location) available to
the Employee immediately prior to such reduction; (c) a reduction by the Company
of the Employee's Base Salary as in effect immediately prior to such reduction;
(d) a material reduction by the Company in the kind or level of employee
benefits to which the Employee is entitled immediately prior to such reduction
with the result that the Employee's overall benefits package is significantly
reduced; (e) without the Employee's express written consent, the relocation of
the Employee to a facility or a location more than fifty (50) miles from the
location of the Company's principal office; (f) any purported termination of the
Employee by the Company which is not effected for Cause; or (g) the failure of
the Company to obtain the assumption of this Agreement by any successors
contemplated in Section 7(i).
6.2 Payments Upon Termination.
(i) Severance Payments. If the Employee's employment with the
Company terminates as a result of an Involuntary Termination at any time after a
Change of Control, then the Employee shall be entitled to receive a lump sum
payment equal to one (1) times Employee's annual Base Salary at the rate in
effect just prior to the date of the notice of termination. Such amount shall be
in addition to any amounts due under this agreement.
Such severance payments shall be paid in a single lump sum within
thirty (30) days of such termination. In addition, the Company shall continue to
make available to the Employee and Employee's spouse and dependents covered
under any group health plans or life insurance plans of the Company on the date
of such termination of employment, all group health, life and other similar
insurance plans in which Employee or such covered dependents participate on the
date of the Employee's termination for a period of twelve (12) months on the
same basis as provided on the date of termination.
(ii) Option Acceleration. If the Employee's employment with the
Company terminates as a result of an Involuntary Termination, then the vesting
and exercisability of each option granted to the Employee by the Company (the
"Options") shall be automatically accelerated in full.
6.3 Payments on Other Termination. If the Employee's employment with
the Company terminates as a result of an Involuntary Termination, other than as
a result of an Involuntary Termination after a Change of Control, or termination
by the Company without Cause, then the Employee shall not be entitled to receive
severance or other benefits hereunder, other than payments through the end of
this Agreement, or for one year, whichever is longer. If
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termination is for Cause, Employee shall be paid his Base Salary to the date of
the notice of termination.
6.4 Accrued Wages and Vacation; Expenses. Without regard to the
reason for, or the timing of, Employee's termination of employment: (a) the
Company shall pay the Employee any unpaid base salary due for periods prior to
the date of termination; (b) the Company shall pay the Employee all of the
Employee's accrued and unused vacation through the date of termination; and (c)
following submission of proper expense reports by the Employee, the Company
shall reimburse the Employee for all expenses reasonably and necessarily
incurred by the Employee in connection with the business of the Company prior to
the date of termination. These payments shall be made promptly upon termination
and with the period of time mandated by law.
7. Successors.
(i) Company's Successors. Any successor to the Company (whether
direct or indirect and whether by purchase, lease, merger, consolidation,
liquidation or otherwise) to all or substantially all of the Company's business
and/or assets shall assume the Company's obligations under this Agreement and
agree expressly to perform the Company's obligations under this Agreement in the
same manner and to the same extent as the Company would be required to perform
such obligations in the absence of a succession. For all purposes under this
Agreement, the term "Company" shall include any successor to the Company's
business and/or assets which executes and delivers the assumption agreement
described in this section or which becomes bound by the terms of this Agreement
by operation of law.
(ii) Employee's Successors. Without the written consent of the
Company, Employee shall not assign or transfer this Agreement or any right or
obligation under this Agreement to any other person or entity. Notwithstanding
the foregoing, the terms of this Agreement and all rights of Employee hereunder
shall inure to the benefit of, and be enforceable by, Employee's personal or
legal representatives, executors, administrators, successors, heirs,
distnbutees, devisees and legatees.
8. Notices.
(i) General. Notices and all other communications contemplated by
this Agreement shall be in writing and shall be deemed to have been duly given
when personally delivered or when mailed by U.S. registered or certified mail,
return receipt requested and postage prepaid. In the case of the Employee,
mailed notices shall be addressed to him at the home address that he most
recently communicated to the Company in writing. In the case of the Company,
mailed notices shall be addressed to its corporate headquarters, and all notices
shall be directed to the attention of its Secretary.
(ii) Notice of Termination. Any termination by the Company for cause
or by the Employee as a result of a voluntary resignation or an Involuntary
Termination shall be communicated by a notice of termination to the other party
hereto given in accordance with this Section. Such notice shall indicate the
specific termination provision in this Agreement relied upon, shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis
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for termination under the provision so indicated. The failure by the Employee to
include in the notice any fact or circumstance which contributes to a showing of
Involuntary Termination shall not waive any right of the Employee hereunder or
preclude the Employee from asserting such fact or circumstance in enforcing his
rights hereunder.
9. Arbitration.
(i) Any dispute or controversy arising out of, relating to, or in
connection with this Agreement, or the interpretation, validity, construction,
performance, breach, or termination thereof, shall be settled by binding
arbitration to be held in Houston, Texas, in accordance with the National Rules
for the Resolution of Employment Disputes then in effect of the American
Arbitration Association (the "Rules"). The arbitrator may grant injunctions or
other relief in such dispute or controversy. The decision of the arbitrator
shall be final, conclusive and binding on the parties to the arbitration.
Judgment may be entered on the arbitrator's decision in any court having
jurisdiction.
(ii) The arbitrator(s) shall apply Texas law to the merits of any
dispute or claim, without reference to conflicts of law rules. The arbitration
proceedings shall be governed by federal arbitration law and by the Rules,
without reference to state arbitration law. Employee hereby consents to the
personal jurisdiction of the state and federal courts located in Texas for any
action or proceeding arising from or relating to this Agreement or relating to
any arbitration in which the parties are participants.
(iii) EMPLOYEE HAS READ AND UNDERSTANDS THIS SECTION, WHICH
DISCUSSES ARBITRATION. EMPLOYEE UNDERSTANDS THAT SUBMITTING ANY CLAIMS ARISING
OUT OF, RELATING TO, OR IN CONNECTION WITH THIS AGREEMENT, OR THE
INTERPRETATION, VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH OR TERMINATION
THEREOF TO BINDING ARBITRATION TO THE EXTENT PERMITTED BY LAW, AND THAT THIS
ARBITRATION CLAUSE CONSTITUTES A WAIVER OF EMPLOYEE'S RIGHT TO A JURY TRIAL AND
RELATES TO THE RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE
EMPLOYER/EMPLOYEE RELATIONSHIP, INCLUDING BUT NOT LIMITED TO, THE FOLLOWING
CLAIMS:
(a) ANY AND ALL CLAIMS FOR WRONGFUL DISCHARGE OF EMPLOYMENT;
BREACH OF CONTRACT, BOTH EXPRESS AND IMPLIED; BREACH OF THE COVENANT OF GOOD
FAITH AND FAIR DEALING, BOTH EXPRESS AND IMPLIED; NEGLIGENT OR INTENTIONAL
INFLICTION OF EMOTIONAL DISTRESS; NEGLIGENT OR INTENTIONAL MISREPRESENTATION;
NEGLIGENT OR INTENTIONAL INTERFERENCE WITH CONTRACT OR PROSPECTIVE ECONOMIC
ADVANTAGE; AND DEFAMATION.
(b) ANY AND ALL CLAIMS FOR VIOLATION OF ANY FEDERAL, STATE OR
MUNICIPAL STATUTE, INCLUDING, BUT NOT LIMITED TO, TITLE VII OF THE CIVIL RIGHTS
ACT OF 1964, THE CIVIL RIGHTS ACT OF 1991, THE AGE DISCRIMINATION IN EMPLOYMENT
ACT OF 1967, THE AMERICANS WITH DISABILITIES ACT OF 1990, THE FAIR LABOR
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STANDARDS ACT, THE CALIFORNIA FAIR EMPLOYMENT AND HOUSING ACT, AND LABOR
CODE SECTION 201, ET SEQ.
(c) ANY AND ALL CLAIMS ARISING OUT OF ANY OTHER LAWS AND
REGULATIONS RELATING TO EMPLOYMENT OR EMPLOYMENT DISCRIMINATION.
10. Miscellaneous Provisions.
(i) No Duty to Mitigate. The Employee shall not be required to
mitigate the amount of any payment contemplated by this Agreement, nor shall any
such payment be reduced by any earnings that the Employee may receive from any
other source.
(ii) Waiver. No provision of this Agreement may be modified, waived
or discharged unless the modification, waiver or discharge is agreed to in
writing and signed by the Employee and by an authorized officer of the Company
(other than the Employee). No waiver by either party of any breach of, or of
compliance with, any condition or provision of this Agreement by the other party
shall be considered a waiver of any other condition or provision or of the same
condition or provision at another time.
(iii) Integration. This Agreement and the stock option agreements
representing the Options represent the entire agreement and understanding
between the parties as to the subject matter herein and supersede all prior or
contemporaneous agreements, whether written or oral.
(iv) Choice of Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the internal substantive
laws, but not the conflicts of law rules, of the State of Texas.
(v) Severability. The invalidity or unenforceability of any
provision or provisions of this Agreement shall not affect the validity or
enforceability of any other provision hereof, which shall remain in full force
and effect.
(vi) Employment Taxes. All payments made pursuant to this Agreement
shall be subject to withholding of applicable income and employment taxes.
(vii) Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original, but all of which together will
constitute one and the same instrument.
(viii) California Expenses. Company shall furnish Employee with
Company-paid living accommodations (condo, apartment, or other rental property)
for employee's and his family's use when Employee is working from the
Carpinteria, California offices. No such accommodation shall be afforded
Employee when he is working from Texas. The type and quality of the
accommodations shall be at the discretion of the Chief Executive Officer.
IN WITNESS WHEREOF, each of the parties has executed this Agreement, in
the case of the Company by its duly authorized officer, as of the day and year
first above written.
COMPANY: ▇▇▇▇▇▇ OIL AND GAS COMPANY
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
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Chief Executive Officer
EMPLOYEE: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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