EXHIBIT 2.2
EXECUTIVE EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT (this "Agreement") is dated as of January 1,
1998 (the "Effective Date") and is entered into by and between Texoil, Inc., a
Nevada corporation (the "Company"), and Xxxxx X. Xxxxxxxxx, an individual
resident of Xxxxxxxxxx County (the "Executive").
W I T N E S S E T H:
WHEREAS, the Company and Cliffwood Oil & Gas Corp. ("Cliffwood") have
agreed to a merger in which Texoil Acquisition, Inc. ("Texoil Sub"), a
wholly-owned subsidiary of Texoil, will merge with and into Cliffwood with
Cliffwood being the surviving corporation (the "Merger") pursuant to an
Agreement and Plan of Merger among Texoil, Texoil Sub and Cliffwood dated
December 20, 1997 (the "Merger Agreement").
WHEREAS, the Executive is currently employed by Cliffwood and the
Company wishes to secure for itself the benefit of the Executive's background,
experience, ability and expertise and the Executive has indicated his
willingness to provide his services, on the terms and conditions set forth
herein;
WHEREAS, it is a condition to closing of the transactions contemplated
by the Merger Agreement that the Executive and the Company enter into this
Agreement;
NOW, THEREFORE, on the basis of the foregoing premises and in
consideration of the mutual promises and covenants contained herein, the patties
hereto agree as follows:
SECTION 1. EMPLOYMENT.
(a) The Company hereby agrees to employ the Executive and the
Executive hereby accepts employment with the Company, on the terms and
subject to the conditions contained in this Agreement. Subject to the
terms and conditions contained herein, the Executive shall serve as
Chairman of the Board of Directors of the Company (the "Board of
Directors") and Chief Executive Officer of the Company and, in such
capacity, shall report directly to the Board of Directors. In addition,
the Company hereby agrees to nominate the Executive to serve as a member
of the Board of Directors for at least three (3) consecutive one year
terms beginning on the Effective Date. The Executive shall have such
duties, functions, responsibilities and authority as are consistent with
the Executive's position as the senior executive officer in charge of
the general management, business and affairs of the Company and its
subsidiaries including, but not limited to, the development and
implementation of strategies, goals, internal policies and programs
designed to achieve the profit, market share and growth that the Company
and its subsidiaries desire, together with such additional duties,
functions, responsibilities and authority including, without limitation,
serving as an officer and/or director of any subsidiary of the Company,
commensurate with the Executive's position as set forth in this
Agreement, as may be reasonably assigned to the Executive from time to
time by the Board of Directors. In connection with his employment under
this Agreement, the Executive shall be based at the offices of
Cliffwood.
(b) As additional consideration for the Executive to enter into
the obligations set forth in this Agreement: (i) the Company shall,
contemporaneous with execution and delivery of this Agreement, cause to
be granted to the Executive options to acquire each year during the
Employment Term (as defined below) 33,334 shares of Company common stock
at the prevailing market rate on the date of each grant pursuant to the
Texoil, Inc. 1994 Stock Option Plan; and (ii) the Company and its
wholly-owned subsidiaries, jointly and severally, shall indemnify and
hold harmless Executive from any claim asserted against him as an
employee, officer or director of the Company or any subsidiary or
affiliate of the Company to the fullest extent permitted by, and subject
to the provisions of, Nevada law, except only that Executive shall not
be indemnified for any material violation by Executive of the terms of
this Agreement.
SECTION 2. TERM. Subject to the provisions and conditions of this
Agreement (including Section 6), the Executive's employment hereunder shall
commence on the date hereof and shall continue until the third anniversary of
the Effective Date unless extended by mutual written agreement of the Company
and the Executive (the "Employment Term").
SECTION 3. COMPENSATION.
(a) SALARY. As compensation for the performance of the
Executive's services under this Agreement, the Company shall pay to the
Executive a base salary (the "Salary") of Ninety Thousand and No/100
Dollars ($90,000.00) per annum with increases, if any, as may be
approved in writing by the Board of Directors. The Salary shall be
payable in accordance with payroll practices of the Company as the same
shall exist from time to time. In no event shall the Salary be decreased
during the Employment Term.
(b) BONUS PLAN. The Executive shall be entitled to receive bonus
compensation consisting of cash, securities or property (the "Bonus") in
accordance with any management incentive plan or plans which may be
established from time to time by the Board of Directors for its
executive officers and management.
(c) BENEFITS. In addition to the Salary and the Bonus, the
Executive shall be entitled to participate in or to receive the health,
insurance, pension, automobile, severance, vacation, holiday, sick
leave, disability, profit sharing, 401(k) savings and other benefits as
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shall be determined by the Board of Directors to be consistent with the
best interest of the Company.
(d) PAYING ENTITY. The Company may cause any one or more of its
subsidiaries to provide the Salary, Bonus and other benefits to the
Executive as are required by this Agreement.
SECTION 4. EXCLUSIVITY. During the Employment Term, the Executive shall
devote substantially all of his time to the business of the Company, shall
faithfully serve the Company, shall in all respects conform to and comply with
the lawful and reasonable directions and instructions given to him by the Board
of Directors or its designee in accordance with the terms of this Agreement,
shall use his best efforts to promote and serve the interests of the Company and
shall not engage in any other business activity, whether or not such activity
shall be engaged in for pecuniary profit, except that the Executive may (a)
participate in the activities of the subsidiaries and affiliates of the Company
as an officer and/or director of such companies, (b) devote such time as is
necessary to cause Energy Resource Associates, Inc., the general partner of V&C
Energy Limited Partnership, to satisfy its obligations under the terms of the
V&C Limited Partnership Agreement dated effective July 1, 1989, (c) participate
in the activities of professional trade organizations related to the business of
the Company, and, (d) engage in personal investing and charitable activities,
provided that the activities set forth in the foregoing clauses, either singly
or in the aggregate, do not interfere in any material respect with the services
to be provided by the Executive under this Agreement.
SECTION 5. REIMBURSEMENT FOR EXPENSES. The Company shall promptly
reimburse the Executive for all reasonable out-of-pocket travel, entertainment
and other business expenses incurred by the Executive during the term of this
Agreement and in the performance of his duties hereunder in accordance with the
Company's reimbursement policies as determined by the Board of Directors.
SECTION 6. TERMINATION.
6.1 DEATH. This Agreement shall automatically terminate upon the
death of the Executive and upon such event, the Executive's estate shall
be entitled to receive the amounts specified in Section 6.6 below.
6.2 DISABILITY. If the Executive is unable to perform the duties
required of him under this Agreement because of physical or mental
disability, this Agreement shall remain in full force and effect and the
Company shall pay all compensation required to be paid to the Executive
hereunder, unless the Executive is unable to perform the duties required
of him under this Agreement for an aggregate of one hundred twenty (120)
days (whether or not consecutive) during any twelve (12) month period
during the term of this Agreement, in which event this Agreement (other
than Sections 7 and 15 hereof), including, but not limited to, the
Company's obligations to pay any Salary or to provide any privileges
under this Agreement, shall, upon written notice by the Company to the
Executive to such effect, terminate; provided, however, that the
foregoing shall not prejudice the Executive's rights
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to continuing, existing insurance benefits for which he is otherwise
eligible, including disability benefits. In case of any dispute as to
whether Executive is disabled within the meaning of this Section 6.2,
the determination of such disability for the period specified shall be
certified by a physician reasonably acceptable to both the Company and
the Executive, which physician's determination shall be final and
binding on the parties hereto. The Company shall be permitted to hire a
replacement for the Executive, so long as this Agreement shall remain in
effect, to serve in the event and for so long as the Executive shall be
unable to perform the duties required of him hereunder due to his
disability for an aggregate of ninety (90) days during any twelve (12)
month period during the term of this Agreement.
6.3 JUST CAUSE. The Company may terminate this Agreement (other
than Sections 7 and 15 hereof) for "Just Cause." For purposes of this
Agreement, "Just Cause" shall mean: (a) the Executive's willful and
continued failure, neglect or refusal to perform his duties hereunder
which failure, neglect or refusal shall not have been corrected by the
Executive within thirty (30) days of receipt by the Executive of written
notice from the Company of such failure, neglect or refusal, which
notice shall specifically set forth the nature of said failure, neglect
or refusal; (b) any willful or intentional engagement by the Executive
in misconduct (including repeated drunkenness or use of illegal drugs)
that is materially injurious to the reputation or business of the
Company or its affiliates or that materially impairs the ability of the
Executive to perform his duties and responsibilities hereunder; (c) any
continued or repeated absence from the Company, unless such absence is
(i) approved or excused by the Board of Directors or (ii) is the result
of the Executive's physical or mental disability (in which event the
provisions of Section 6.2 hereof shall control) or a personal or family
emergency; (d) conviction or plea of nob contendere by the Executive for
the commission of a felony; or (e) the commission by the Executive of an
act of fraud or embezzlement against the Company or any of its
subsidiaries of affiliates. If the Executive's employment is terminated
for Just Cause, the Executive shall be entitled to receive the amounts
specified in Section 6.6 hereof. In the event of any termination
pursuant to this Section 6.3, the Company shall deliver to the Executive
written notice setting forth the basis for such termination, which
notice shall specifically set forth the nature of the Just Cause, and
the facts and circumstances in connection therewith, which is the reason
for such termination.
6.4 GOOD REASON. The Executive may terminate this Agreement for
"Good Reason" following a Substantial Breach (as defined below) if such
Substantial Breach shall not have been corrected by the Company within
thirty (30) days of receipt by the Company of written notice from the
Executive of the occurrence of such Substantial Breach, which notice
shall specifically set forth the nature of the Substantial Breach which,
if not corrected, will entitle the Executive at any time after such
thirty (30) day notice period and by subsequent written notice to
terminate this Agreement. In the event of resignation by the Executive
following a Substantial Breach, the Executive shall be entitled to
receive the amounts specified in Section 6.6 hereof. An election by the
Executive to terminate his
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employment under this paragraph shall not be a breach of this Agreement.
The term "Substantial Breach" means any material breach by the Company
of its obligations hereunder consisting of: (a) the failure of the
Company to pay the Executive the Salary or Bonus, if any, in accordance
with Sections 3(a) and (b) hereof; (b) the failure by the Company to
substantially maintain and continue the Executive's participation in
benefit plans as provided in Section 3(c) hereof; (c) any material
diminishment in the duties or responsibilities of the Executive
described in Section 1 hereof, or any removal of the Executive from or
any failure to re-elect the Executive to (x) the positions described in
Section 1, except in connection with promotions to higher office, or (y)
the position as a director of the Company; (d) the Company's requiring
the Executive to be based anywhere other than in or within thirty-five
(35) miles of the Executive's current principal place of employment,
except for required travel on the business of the Company to an extent
substantially consistent with the Executive's prior business travel
obligations, or, in the event the Executive consents to relocation, the
failure of the Company to pay or reimburse the Executive for all
reasonable costs incurred by the Executive in connection with such
relocation as mutually agreed by the Company and the Executive prior to
such relocation; and (e) the failure of any successor to all or
substantially all of the business and/or assets of the Company to assume
this Agreement; provided, however, that the term "SUBSTANTIAL BREACH"
shall not include a termination of the Executive's employment hereunder
pursuant to Section 6.2 or 6.3 hereof. The date of termination of the
Executive's employment under this Section 6.4 shall be the effective
date of any resignation specified in writing by the Executive, which
shall not be less than thirty (30) days after receipt by the Company of
written notice of such resignation, provided that any resignation by
Executive shall not be effective pursuant to this Section 6.4 if such
Substantial Breach shall have been corrected by the Company during the
thirty (30) day period following notice by the Executive of the
existence thereof or if corrected thereafter prior to the date of
resignation by the Executive.
6.5 WITHOUT CAUSE. The Company, by action of its Board of
Directors, may terminate this Agreement (other than Sections 7 and 10
hereof) without Just Cause upon the giving to the Executive of thirty
(30) days' prior written notice of such termination. If the Executive's
employment is terminated by the Company without Just Cause, the
Executive shall be entitled to receive the amounts specified in Section
6.6 hereof.
6.6 PAYMENTS. In the event that the Executive's employment
hereunder terminates for any reason, the Company shall promptly pay to
the Executive all amounts accrued but unpaid hereunder through the date
of termination in respect of the Salary and for reimbursement of any
expenses pursuant to Section 5 hereof, and, in the ease of any
termination by reason of death or physical or mental disability of the
Executive pursuant to Section 6.1 or 6.2 hereof, a pro rated portion of
the Bonus, if any, which the Executive would have been otherwise
entitled to receive under Section 3(b) for the calendar year in which
such termination occurs, such pro rated portion being the portion of
such Bonus corresponding to the period commencing on January 1 of such
year and ending on the date of termination. In the event that the
Executive's employment has been terminated by the
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Company for Just Cause, the Company shall have no obligations to the
Executive for Salary, Bonus or other benefits herein provided accruing
on or after the date of termination except as set forth in the preceding
sentence or as may be otherwise provided by law. In the event that the
Executive's employment hereunder is terminated by the Company without
Just Cause or by the Executive with Good Reason, in addition to the
amounts specified in the first sentence of this Section 6.6, the
Executive shall continue to receive the Salary at the rate in effect
hereunder on the date of such termination periodically, in accordance
with the Company's prevailing payroll practices, until the last date of
the Employment Term or until the first anniversary of the termination
date, if longer, plus (a) the cost of the Executive's premiums for
health care benefits under COBRA or the cost of the Executive's premiums
under any replacement health insurance coverage obtained by Executive
containing substantially the same coverage as provided to the Executive
(including amounts paid to reimburse Executive for the premium costs he
incurred to maintain his own health insurance coverage) at such time,
which premiums shall be payable as and when the Salary would otherwise
have been payable as provided in this Agreement; and (b) a pro rated
portion of the Bonus, if any, which the Executive would have otherwise
been entitled to receive under Section 3(b) hereof for the calendar year
in which the Executive is terminated pro rated in the same manner as set
forth in the first sentence of this Section 6.6. Without intending to
limit the generality of Section 7 hereof, in the event that the
Executive accepts other employment or engages in his own business prior
to the last date of the Employment Term, the Executive shall forthwith
notify the Company and the Company shall be entitled to set off from
amounts due the Executive under this Section 6.6 the amounts paid to the
Executive in respect of such other employment or business activity. Upon
any termination of this Agreement, all of the rights, privileges and
duties of the Executive hereunder shall cease, except for any rights
under this Section 6.6 and any obligations under Sections 7 and 15
hereunder.
Section 7. SECRECY.
7.1 NONDISCLOSURE OF CONFIDENTIAL INFORMATION. The Executive,
except in connection with his employment hereunder or as required by
legal process, shall not disclose to any person or entity or use, during
the Employment Term or at any time thereafter, any information not in
the public domain or generally known in the industry, in any form
acquired by the Executive while employed by the Company or any
predecessor to the Company's business or, if acquired following the
Employment Term, such information which, to the Executive's knowledge,
has been acquired, directly, or indirectly, from any person or entity
owing a duty of confidentiality to the Company or any of its
subsidiaries or affiliates, relating to the Company, its subsidiaries or
affiliates, including but not limited to information regarding
customers, vendors, suppliers, trade secrets, training programs, manuals
or materials, technical information including without limitation
geological and geophysical data, contracts, systems, procedures, mailing
lists, know-how, trade names, improvements, price lists, financial or
other data (including the revenues, costs or profits associated with any
of the Company's properties), invoices and other financial statements,
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computer programs, software systems, databases, customer and industry
lists, correspondence, internal reports, personnel files, sales and
advertising material, telephone numbers, names, addresses or any other
compilation of information, written or unwritten, which is or was used
in the business of the Company or any of its subsidiaries or affiliates
(collectively, "Confidential Information"); provided, however, that the
term Confidential Information shall not include (a) general skills and
general knowledge of an industry obtained by reason of the Executive's
association with the Company; (b) information concerning the business
and operations of the Company and its subsidiaries and/or the industry
in which the Company and its subsidiaries conduct business which was in
the possession of or known to the Executive prior to the Executive's
employment with the Company; and (c) any financial or other information
with respect to the assets, properties, rights, business or operations
of Cliffwood or any of its subsidiaries. The Executive agrees and
acknowledges that all Confidential Information, in any form, and copies
and extracts thereof are and shall remain the sole and exclusive
property of the Company, and upon termination of his employment with the
Company, the Executive shall return to the Company the originals and all
copies of any Confidential Information provided to or acquired by the
Executive in connection with the performance of his duties for the
Company, and shall return to the Company all files, correspondence
and/or other communications received, maintained and/or originated by
the Executive during the course of his employment.
7.2 INVENTIONS. The Executive hereby sells, transfers and assigns
to the Company, or to any person or entity designated in writing by the
Company, all of the right, title and interest of the Executive in and to
all inventions, sales materials, software, training materials,
disclosures and improvements, whether patented or unpatented, and
copyrightable material, made or conceived by the Executive, solely or
jointly, in whole or in part, during his employment with the Company
which are not generally known to the public or the industry or
recognized as standard practice and which (a) relate to services, trade
names, methods, ideas, apparatus, designs, products, processes or
devices which may be sold, leased, used or under construction or
development by the Company, or any franchise affiliated with the Company
and (b) arise (wholly or partly) from the efforts of the Executive
during and in the course of his employment with the Company (an
"Invention"). The Executive shall communicate promptly and disclose to
the Company, in such form as the Company reasonably requests, all
information, details and data pertaining to any such any Invention. With
respect to all Inventions which are to be assigned pursuant to this
Section 7, the Executive will assist the Company in any reasonable
manner to obtain for the Company's benefit patents thereon, including,
but not limited to, executing patent applications, transfers or
assignments thereof to the Company and any and all other documents
reasonably deemed necessary by the Company. The Company shall pay all
costs incident to the preparation, execution and delivery of such patent
applications, transfers, assignments and other documents. Any Invention
by the Executive within six (6) months following the termination of his
employment under shall be presumed to fall within the provisions of this
Section 7.2 unless Executive bears the burden of proof of showing that
the Invention was first conceived and made following such termination.
Notwithstanding anything contained herein to the
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contrary, the Executive shall continue to own the exclusive right, title
and interest in and to any and all inventions, improvements,
discoveries, ideas, designs, documents and other data (whether or not
patentable): (a) conceived, made and developed prior to the date of this
Agreement; and (b) irrespective of when conceived, made or developed,
which do not relate to the actual or anticipated business of the Company
or any existing or prior research and development activities of the
Company or any of its subsidiaries or affiliates.
7.3 INJUNCTIVE RELIEF. Without intending to limit the remedies
available to the Company, the Executive acknowledges that a breach of
any of the covenants contained in Section 7 hereof may result in
material irreparable injury to the Company or its subsidiaries or
affiliates for which there is no adequate remedy at law, that it will
not be possible to measure damages for such injuries precisely and that,
in the event of such a breach or threat thereof, the Company shall be
entitled to seek a temporary restraining order and/or a preliminary or
permanent injunction, restraining the Executive from engaging in
activities prohibited by Section 7 hereof or such other relief as may be
required specifically to enforce any of the covenants in Section 7
hereof.
SECTION 8. SUCCESSORS AND ASSIGNS: NO THIRD-PARTY BENEFICIARIES. This
Agreement shall inure to the benefit of, and be binding upon, the parties hereto
and their respective successors and assigns, including, but not limited to, the
Executive's heirs and personal representatives of the Executive's estate;
provided, however, that neither party shall assign or delegate any of the
obligations created under this Agreement without the prior written consent of
the other party. Notwithstanding the foregoing, the Company shall have the
unrestricted right to assign this Agreement and to delegate all or any part of
its obligations hereunder to any of its subsidiaries, so long as such assignment
does not diminish the duties, function, responsibility or authority of the
Executive or result in any assignment of duties or responsibilities materially
inconsistent with those set forth in this Agreement (unless consented to by the
Executive) but in such event such assignee shall expressly assume all
obligations of the Company hereunder and the Company shall remain fully liable
for the performance of all such obligations in the manner prescribed in this
Agreement. Nothing in this Agreement shall confer upon any person or entity not
a party to this Agreement, or (unless otherwise expressly provided herein) the
legal representatives of such person or entity, any rights or remedies of any
nature or kind whatsoever under or by reason of this Agreement.
SECTION 9. WAIVER AND AMENDMENTS. Any waiver, alteration, amendment or
modification of any of the terms of this Agreement shall be valid only if made
in writing and signed by the parties hereto. No waiver by either of the parties
hereto of their rights hereunder shall be deemed to constitute a waiver with
respect to any subsequent occurrences or transactions hereunder unless such
waiver specifically states that it is to be construed as a continuing waiver.
SECTION 10. SEVERABILITY AND GOVERNING LAW. The Executive acknowledges
and agrees that the covenants set forth Section 7 hereof are reasonable and
valid in all respects. Each party hereto acknowledges and agrees that if any of
such covenants or other provisions of this Agreement are found to be invalid or
unenforceable by a final determination of a court of competent jurisdiction
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(a) the remaining terms and provisions hereof shall be unimpaired and (b) the
invalid and unenforceable term or provision shall be deemed replaced by a term
or provision that is valid and enforceable and that comes closest to expressing
the intention of the invalid or unenforceable term or provision. THIS AGREEMENT
SHALL BE GOVERNED BY AND INTERPRETED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF TEXAS WITHOUT GIVING EFFECT TO THE CHOICE OF LAW PROVISIONS
THEREOF.
SECTION 11. NOTICES. All notices and other communications given or made
pursuant hereto shall be in writing and shall be deemed to have been duly given
or made if delivered personally or sent by registered or certified mail postage
prepaid, return receipt requested), or sent by facsimile transmission or
overnight courier service, addressed in the ease of the Company, to Cliffwood
Oil & Gas Corp., 000 Xxxxxxx Xxxxxxx Xxxxx, Xxxxxxx, Xxxxx 00000 Attention:
President, fax: (000) 000-0000 and, in the case of the Executive, to the
Executive's address set forth on the signature page hereof or, in each case, to
such other address as may be designated to the other party from time to time as
provided above. All notices so given shall be effective when received at the
designated address.
SECTION 12. CAPTIONS AND SECTION HEADINGS. Captions and section headings
herein are solely for convenience of reference and shall not affect the meaning
or interpretation of this Agreement or of any term or provision hereof.
SECTION 13. ENTIRE AGREEMENT. This Agreement constitutes the entire
understanding and agreement of the parties hereto regarding the employment of
the Executive. This Agreement supersedes all prior negotiations, discussions,
correspondence, communications, understandings and agreements between the
parties relating to the subject matter of this Agreement, all of which are
merged into this Agreement.
SECTION 14. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which
together shall be considered one and the same agreement.
SECTION 15. DISPUTES. Any dispute or controversy arising under, out of,
in connection with or in relation to this Agreement, the employment of Executive
or the termination of Executive's employment ("Disputes") shall, at the election
and upon written demand of either party, be finally determined and settled by
binding arbitration in the city of Houston, Texas in accordance with the
procedures set forth in the exhibit entitled "ARBITRATION PROCEDURES" attached
hereto, and judgment upon the award may be entered in any court having
jurisdiction thereof; provided, however, that: (a) this Section 15 shall not
apply to matters required to be determined by a physician pursuant to Section
6.2; and 6.3 the parties acknowledge and agree that an arbitrator or arbitrators
shall not have the power or right to order the payment by either party of
damages (including punitive damages), compensation or other amounts that are not
provided for in this Agreement, it being the intention of the parties that the
arbitrator or arbitrators shall resolve Disputes, in respect of the payments,
only
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as to whether or not a payment is due hereunder and, if so, the amount thereof,
but shall not provide for any additional payments as a result of the matters
contemplated hereby.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective as of the date first above written.
TEXOIL, INC.
By: /S/ XXXXX XXXXXXX
Name: XXXXX XXXXXXX
Title: PRESIDENT AND CHIEF EXECUTIVE OFFICER
EXECUTIVE
/S/ XXXXX X. XXXXXXXXX
Xxxxx X. Xxxxxxxxx
Address:
00000 Xxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Fax. No.: (000) 000-0000
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ARBITRATION PROCEDURES
(a) All Disputes between the parties submitted to arbitration shall be
resolved by binding arbitration administered by the American Arbitration
Association (the "AAA") in accordance with, and in the following order of
priority: (i) the terms of these arbitration provisions; (ii) the Commercial
Arbitration Rules of the AAA; (iii) the Federal Arbitration Act (Title 9 of the
United States Code); and (iv) to the extent the foregoing are inapplicable,
unenforceable or invalid, the laws of the State of Texas. The validity and
enforceability of these arbitration provisions shall be determined in accordance
with this same order of priority. In the event of any inconsistency between
these arbitration provisions and such rules and statutes, these arbitration
provisions shall control. Judgment upon any award rendered hereunder shall be
entered in any court having jurisdiction.
(b) All statutes of limitation applicable to any Dispute shall apply to
any proceeding in accordance with these arbitration provisions.
(c) Arbitrators are empowered to resolve Disputes by summary rulings
substantially similar to summary judgments and motions to dismiss. Arbitrators
shall resolve all Disputes in accordance with the applicable substantive law.
Any arbitrator selected shall be required to be experienced and knowledgeable in
the substantive laws applicable to the subject matter of the Dispute. With
respect to a Dispute in which the claims or amounts in controversy do not exceed
$100,000, a single arbitrator shall be chosen and shall resolve the Dispute. In
such ease, the arbitrator shall be required to make specific, written findings
of fact, and shall have authority to render an award up to but not to exceed
$100,000, including all amounts properly payable and costs, fees and expenses
(subject to Section 15 of the Agreement). A Dispute involving claims or amounts
in controversy exceeding $100,000, shall be decided by a majority vote of a
panel of three (3) arbitrators (an "Arbitration Panel"), the determination of
any two (2) of the three (3) arbitrators constituting the determination of the
Arbitration Panel; PROVIDED. HOWEVER, that all three (3) arbitrators on the
Arbitration Panel must actively participate in all hearings and deliberations.
Arbitrators, including any Arbitration Panel, may grant any remedy or relief
deemed just and equitable and within the scope of these arbitration provisions
and may also grant such ancillary relief as is necessary to make effective any
award. The determination of an arbitrator or Arbitration Panel shall be binding
on all parties and shall not be subject to further review or appeal except as
otherwise allowed by applicable law.
(d) To the maximum extent practicable, the AAA, the arbitrator (or the
Arbitration Panel, as appropriate) and the parties shall take any action
necessary to require that an arbitration proceeding hereunder shall be concluded
within one hundred eighty (180) days of the filing of the Dispute with the AAA.
Unless the Company and the Executive shall agree otherwise, arbitration
proceedings hereunder shall be conducted in Houston, Texas. Arbitrators shall be
empowered to impose sanctions and to take such other actions as they deem
necessary to the same extent a judge could pursuant to the Federal Rules of
Civil Procedure and applicable law. With respect to any Dispute, each party
agrees that all discovery activities shall be expressly limited to matters
directly
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relevant to the Dispute and any arbitrator, Arbitration Panel and the AAA shall
be required to fully enforce this requirement. The provisions of these
arbitration provisions shall survive any termination, amendment or expiration of
this Agreement, unless the parties otherwise expressly agree in writing. To the
extent permitted by applicable law, arbitrators, including any Arbitration
Panel, shall have the power to award recovery of all costs and fees (including
attorneys' fees, administrative fees and arbitrators' fees) to the prevailing
party or, if no clear prevailing party, as the arbitrator (or Arbitration Panel,
if applicable) shall deem just and equitable. Each party agrees to keep all
Disputes and arbitration proceedings strictly confidential, except for
disclosures of information required by applicable law.
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