1
EXHIBIT 10.7
EMPLOYMENT AGREEMENT OF XXXXX XXXXXX
ZENEX COMMUNICATIONS
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made this 28th DAY OF
NOVEMBER, 2000 between ZENEX LONG DISTANCE INC., an Oklahoma corporation with
its principal place of business in Oklahoma City, Oklahoma, and XXXXX X. XXXXXX
(the "Employee"); whose Social Security Number is ###-##-####.
WHEREAS, the parties hereto wish to enter into an employment agreement
to employ the Employee as the PRESIDENT & CEO of ZENEX LONG DISTANCE, INC. DBA
ZENEX COMMUNICATIONS (the "Company"), and to set forth certain additional
agreements between the Employee and the Company.
NOW, THEREFORE, in consideration of the mutual covenants and
representations contained herein, the parties hereto agree as follows:
1. TERM
The Company will employ the Employee, and the Employee will serve the
Company, under the terms of this Agreement for an initial term of three (3)
years (the "Initial Term"), commencing on the official closing date of the
merger of Lone Wolf Energy, Inc. and Prestige Investments, Inc (the "Effective
Date").
2. EMPLOYMENT
(a) POSITIONS AND REPORTING. The Company hereby employs the Employee for
the Employment Period as its President & CEO on the terms and
conditions set forth in this Agreement. During the Employment Period,
the Employee shall report directly to the President of the parent
company, Lone Wolf Energy, Inc.
(b) AUTHORITY AND DUTIES. The Employee shall exercise such authority,
perform such Employee duties and functions and discharge such
responsibilities as are reasonably associated with the Employee's
positions, commensurate with the authority vested in the Employee
pursuant to this Agreement and consistent with the bylaws of the
Company. During the Employment Period, the Employee shall devote full
business time, skill and efforts to the business of the Company.
3. COMPENSATION AND BENEFITS
(a) SALARY. During the Employment Period, the Company shall pay to the
Employee, as compensation for the performance of his duties and
obligations under this Agreement, a base salary at the rate of $120,000
per annum, payable in not less frequently than BI-monthly in accordance
with the normal payroll practices of the Company (the "Base Salary").
(B) PROFIT BONUS. Employee will receive a bonus of 10% of the net profits
from operations ("Profits"). The description of the plan can be found
in Exhibit 3.15 of the Agreement and Plan of Reorganization between
Lone Wolf Energy, Inc. and Prestige Investments, Inc. For the entirety
of the initial term, the total cash compensation from the profit bonus
will be caped at $130,000 per annum. Once this cap is reached in any
given payroll year started or ended within the initial term, all
additional Profit bonus continue to be calculated as specified in the
Exhibit 3.15 of the above referenced agreement but will be converted to
additional Stock Options. The formula for which is outlined below in
section 3.(c)(ii).
(c) STOCK OPTIONS. (i) Employee will be awarded the option to purchase
250,000 shares of stock at a purchase price of eleven cents ($0.11) per
share at the effective date and up to 750,000 additional shares over a
3 year period from the effective date. The 750,000 additional shares
will be set at the same price of eleven cents ($0.11) per share and
will be allotted in groups of 250,000 each year on the anniversary of
the effective date. (ii) Each Bonus dollar earned above the $130,000 as
described in 3.(b) Profit Bonus, will be converted and granted to
employee in the form of options of 4 shares of stock at a purchase
price of eleven cents ($0.11) per share or the cash equivalent of the
bonus as determined to be in the companies best interest. Any options
granted, shall be available for up to five (5) years.
(d) OTHER BENEFITS. During the Employment Period, the Employee shall
receive such other life insurance, pension, disability insurance,
health insurance, holiday, vacation and sick pay benefits and other
benefits which the Company extends, as a matter of policy, to its
employees and, except as otherwise provided herein, shall be
2
entitled to participate in all deferred compensation and other
incentive plans of the Company on the same basis as other like
employees of the Company.
(e) BUSINESS EXPENSES. During the Employment Period, the Company shall
promptly reimburse the Employee for all documented reasonable business
expenses incurred by the Employee in the performance of his duties
under this Agreement, in accordance with the Company's policies and
standards of similar or comparable companies.
4. TERMINATION OF EMPLOYMENT
(a) TERMINATION FOR CAUSE. The Company may terminate the Employee's
employment hereunder for cause. For purposes of this Agreement and
subject to the Employee's opportunity to cure as provided in Section
4(c) hereof, the Company shall have "cause" to terminate the Employee's
employment hereunder if Employee shall commit any of the following:
(i) any act or omission which shall represent a breach in any
material respect of any of the terms of this Agreement;
(ii) bad faith in the performance of Employee's duties, consisting
of willful acts or omissions, to the detriment of the Company;
(iii) use of illegal drugs or alcoholism; or
(iv) any conviction or pleading of guilty to a crime that
constitutes a felony under the laws of the United States or
any political subdivision thereof.
(b) TERMINATION FOR GOOD REASON. The Employee shall have the right at any
time to terminate his employment with the Company for good reason. For
purposes of this Agreement and subject to the Company's opportunity to
cure as provided in Section 4(c) hereof, the Employee shall have "good
reason" to terminate his employment hereunder if such termination shall
be the result of:
(i) a diminution during the Employment Period in the Employee's
title, duties, reporting relationship or responsibilities as
set forth in Section 2 hereof;
(ii) a breach by the Company of the compensation and benefits
provisions set forth in Section 3 hereof;
(iii) a material breach by the Company of any material terms of this
Agreement.
(c) NOTICE AND OPPORTUNITY TO CURE. Notwithstanding the foregoing, it shall
be a condition precedent to the Company's right to terminate the
Employee's employment for "cause" and the Employee's right to terminate
his employment for "good reason" that (1) the party seeking the
termination shall first have given the other party written notice
stating with specificity the reason for the termination ("breach") and
(2) if such breach is susceptible of cure or remedy, a period of 30
days from and after the giving of such notice shall have elapsed
without the breaching party having effectively cured or remedied such
breach during such 30-day period, unless such breach cannot be cured or
remedied within 30 days, in which case the period for remedy or cure
shall be extended for a reasonable time (not to exceed 30 days)
provided the breaching party has made and continues to make a diligent
effort to effect such remedy or cure.
(d) TERMINATION UPON DEATH OR PERMANENT AND TOTAL DISABILITY. The
Employment Period shall be terminated by the death of the Employee. The
Employment Period may be terminated by the Company if the Employee
shall be rendered incapable of performing his duties to the Company by
reason of any medically determined physical or mental impairment that
can be expected to result in death or that can be expected to last for
a period of six or more consecutive months from the first date of the
disability ("Disability"). If the Employment Period is terminated by
reason of Disability of the Employee, the Company shall give 30-days'
advance written notice to that effect to the Employee.
5. CONSEQUENCES OF TERMINATION
(a) SALARY. If the employer terminates this agreement for cause as stated
in section 4(a), no further benefits will be granted employee. If
Employee terminates this agreement with out good reason, good reason is
defined in section 4(b), no further benefits will be granted employee.
If the employer terminates this agreement without cause, cause is
defined in section 4(a), the
3
salary will continue to be paid as prescribed in this agreement unless
the company exercises its buy out option described in section 5(c).
(b) OTHER BENEFITS. If this agreement is terminated for any reason by
either party, all other benefits cease. Employee will not be eligible
for stock option rights which accrue at a date subsequent to the
termination of this agreement. All stock options earned prior to the
termination of this agreement will remain the property of the employee.
(c) AGREEMENT BUY OUT. The Company may exercise a right to terminate this
agreement at anytime with or without cause for a lump sum payment of
$100,000.
6. DAMAGES
For breach or non-fulfillment of this agreement, neither party shall be
liable or responsible to the other party for any consequential or in
consequential damages not specifically referenced within this
agreement.
IN WITNESS WHEREOF, THE PARTIES HAVE EXECUTED THIS AGREEMENT AS OF NOVEMBER 28,
2000.
ZENEX LONG DISTANCE, INC. DBA ZENEX COMMUNICATIONS
---------------------------------------------------
BY: XXXX XXXXXX
ON BEHALF OF THE BOARD
---------------------------------------------------
DATE
XXXXX XXXXXX
---------------------------------------------------
BY: XXXXX XXXXXX
---------------------------------------------------
DATE
