Exhibit A to Employment Agreement SALARY CONTINUATION AGREEMENT
Exhibit A
to Employment Agreement
THIS SALARY CONTINUATION AGREEMENT (this "Agreement") is made and entered into effective as of June ___, 2004, by and between XXXXX PETROLEUM COMPANY, a Delaware corporation ("Xxxxx"), and XXXXXX X. XXXXXXXXX ("Employee"), with reference to the following facts:
A. Employee is currently serving as the Interim President and Interim Chief Executive Officer of Xxxxx and is a valuable employee of Xxxxx whose continued employment is beneficial to Xxxxx.
B. Effective June ___, 2004, Employee is being named the full-time President and Chief Executive Officer of Xxxxx and Employee and Xxxxx are hereby entering into this Salary Continuation Agreement as recommended by the Compensation Committee of the Board of Directors and adopted by the Board of Directors.
NOW, THEREFORE, in consideration of the mutual promises and obligations contained herein and other good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:
1. Salary Continuation Provision.
(a) In the event of a Change of Control of Berry, Berry agrees to pay to Employee on the effective date of such Change of Control a single payment in an amount equal to his Salary (as defined herein) multiplied by two (2).
(b) For purposes of this Agreement, a "Change of Control" of Xxxxx shall mean and shall be deemed to have occurred if and when any one of the following four events occurs: (a) within the meaning of Section 13(d) of the Securities Exchange Act of 1934, any person or group becomes a beneficial owner, directly or indirectly, of securities of Xxxxx representing 20% or more of the combined voting power of Xxxxx'x then outstanding securities, without the prior approval of Xxxxx; (b) individuals who were members of the Board of Directors immediately prior to a meeting of the stockholders of Xxxxx involving a contest for the election of Directors shall not constitute a majority of the Board of Directors following such election; (c) the stockholders of Xxxxx approve an agreement to merge or consolidate, or otherwise reorganize, with or into one or more entities which are not subsidiaries, as a result of which less than 50% of the outstanding securities of the surviving or resulting entity are, or are to be, owned by former stockholders of Xxxxx (excluding from the term "former stockholders") a stockholder who is, or as a result of the transaction in question, becomes an "affiliate," as that term is used in the Securities Exchange Act of 1934 and the Rules promulgated thereunder, of any party to such merger, consolidated or reorganization); or (d) the stockholders of Xxxxx approve the sale of substantially all of Xxxxx'x business and/or assets (in one transaction or a series of related
transactions) to a person or entity which is not a subsidiary.
Exhibit A
to Employment Agreement
(c) For purposes of this Agreement, Employee's "Salary" shall mean (i) Employee's regular base annual salary in effect as of the effective date of a Change of Control (as reportable on Employee's IRS Form W-2, including the amount of any voluntary deferrals of salary, and excluding any gain from exercise of stock options or any other similar non-recurring payments), plus (ii) an amount equal to the average of the annual discretionary cash bonuses received by Employee for the two (2) fiscal years immediately prior to the Change of Control.
2. Employment Status. No assurance is given to Employee that after a Change of Control he will in fact be retained by Xxxxx, or its successor, or that he will have the same job classification. Employee understands and acknowledges that Xxxxx, or its successor, shall not be obligated in any way to Employee under the provisions of this Agreement if Employee resigns or is terminated by Xxxxx, whether with or without cause, prior to the effective date of a Change of Control so long as employee's termination immediately prior to a Change of Control was not motivated by a bad faith intent to avoid the obligation arising under this Agreement.
3. No Contract of Employment. Nothing in this Agreement shall be construed or interpreted as creating any contract or agreement of employment or any right to continued employment with Xxxxx. This Agreement is not intended to confer upon Employee any right to notice of termination beyond that customarily given by Xxxxx to its employees generally, or as may be set forth in any written employment agreement. Any successor-in-interest of Xxxxx shall be free to establish its own policies or procedures for notice and termination of employment.
4. General Provisions.
(a) Neither this Agreement nor any interest herein may be assigned by Employee.
(b) This Agreement shall be binding upon and shall be enforceable against Xxxxx, its successors-in-interest and assigned and the benefits hereunder shall accrue to Employee, his heirs, executors or administrators.
(c) This Agreement and Paragraph 3.9 of the Employment Agreement between the parties constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, whether oral or written, between them regarding the subject matter hereof.
(d) Any claim, dispute or controversy arising out of or relating to this Agreement, including a claim for declaratory relief, will be covered by Paragraph 5.9 of the Employment Agreement between the parties.
(e) This Agreement shall be construed and governed by the laws, without regard to the laws as to choice or conflict of laws, of the State of California. The parties hereto acknowledge that this Agreement was executed in Xxxx County, California. By execution and
Exhibit A
to Employment Agreement
delivery of this Agreement, the parties hereto agree and accept that any legal action or proceeding shall be brought in the federal or state courts for the State of California, County of Xxxx, and the parties expressly waive any objection to personal jurisdiction, venue or forum nonconveniens.
IN WITNESS WHEREOF, the parties have executed this Agreement effective the date and year first above written.
XXXXX PETROLEUM COMPANY,
a Delaware corporation
By: ____________________________________
XXXXXX X. XXXXX, XX.
Chairman of the Board
"Xxxxx"
__________________________________________
XXXXXX X. XXXXXXXXX
"Employee"
