EXHIBIT 13.1
EMPLOYMENT AGREEMENT
PREAMBLE
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This Employment Agreement (this "Agreement") is made by and between United
Park City Mines Company, a Delaware corporation (the "Company"), and Xxxx
Xxxxxxxx ("Rothwello") to be effective as of the 1st day of June, 1997.
RECITALS
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WHEREAS, the Company and Xxxxxxxx previously entered into that certain
Employment Agreement dated as of June 1, 1994 as amended by that certain
Amendment No. 1 to Employment Agreement dated as of September 5, 1995
(collectively referred to herein as the "Prior Employment Agreement"), whereby
Xxxxxxxx was employed to serve as the Company's President and Chief Executive
Officer; and
WHEREAS, the term of the Prior Employment Agreement expired on May 31,
1997; and
WHEREAS, the Board of Directors of the Company desires and intends to
continue to employ Xxxxxxxx as the Company's President and Chief Executive
Officer on the terms and conditions set forth herein; and
WHEREAS, Xxxxxxxx is willing and desires to continue to be employed by the
Company as its President and Chief Executive Officer on the terms and conditions
set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained herein, the parties hereto agree as follows:
1. Employment. The Company hereby agrees to continue to employ Xxxxxxxx,
and Xxxxxxxx hereby agrees to continue to be employed, as President and Chief
Executive Officer of the Company, upon the terms and conditions hereinafter set
forth. The location of such employment shall be in either Xxxx Xxxx xx Xxxx Xxxx
Xxxx, Xxxx; however, Xxxxxxxx agrees to take whatever reasonable business trips
are requested by the Board of Directors of the Company. The Company and Xxxxxxxx
acknowledge that Xxxxxxxx is presently serving as a director on the Board of
Directors of the Company. As long as Xxxxxxxx is President and Chief Executive
Officer during the term of this Agreement, the Board of Directors of the Company
will cause Xxxxxxxx'x name to be listed on any proxy soliciting votes for the
election of directors.
2. Term. The employment of Xxxxxxxx by the Company pursuant to this
Agreement will be for a period of three (3) years commencing as of June 1, 1997
(the "Employment Term"), unless the Employment Term is terminated earlier
pursuant to the provisions of Section 5 hereof. Notwithstanding the foregoing,
the Company shall have the right, at the Company's sole discretion, to review
Xxxxxxxx'x performance under this Agreement and to terminate this Agreement
without cause, with such termination to be effective on June 1, 1999. In order
for the Company to exercise this right to terminate the Agreement, the Company
must give written notice to Xxxxxxxx of such termination no later than May 1,
1999. In the event the Company exercises its right to terminate this Agreement
as of June 1, 1999, such termination shall be deemed to be the termination of
the Employment Term on the "Normal Expiration Date" pursuant to Section 5.a. of
this Agreement.
3. Duties. Xxxxxxxx agrees to perform the duties outlined in the
CompanyAEs bylaws as being applicable for the CompanyAEs President and Chief
Executive Officer, and to perform such other duties as may be assigned from time
to time by the Board of Directors of the Company. Xxxxxxxx agrees that he will
devote his full time and energy to the affairs of the Company, and that during
the Employment Term he shall report to the Board of Directors of the Company.
Without prior approval of the Board of Directors of the Company, Xxxxxxxx agrees
that he shall not devote his time to any business activities other than the
affairs of the Company during the Employment Term, with the exception of those
business activities (the "Permitted Outside Activities") described in Exhibit
"A" attached hereto and incorporated herein by this reference. The Company
agrees that Xxxxxxxx'x involvement in the Permitted Outside Activities shall not
violate Xxxxxxxx'x obligations arising under this Agreement. Xxxxxxxx agrees to
give written notice to the Board of Directors of the Company in the event that
any of the Permitted Outside Activities in which Xxxxxxxx participates during
the term of this Agreement creates a potential conflict of interest for Xxxxxxxx
between his
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involvement in the Permitted Outside Activity and the performance by
Xxxxxxxx of his duties as the President and Chief Executive Officer of the
Company.
4. Compensation.
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a. Salary. Commencing on June 1, 1997 the Company shall pay Xxxxxxxx
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a minimum annual salary of One Hundred Twenty-Two Thousand Four Hundred Dollars
($122,400), payable in equal semi-monthly installments (such amount, as it may
be increased from time to time, is hereinafter referred to as the "Salary").
The Salary payable to Xxxxxxxx by the Company shall be increased every year
during the term of this Agreement, commencing on June 1, 1998 and continuing on
each June 1 thereafter, to an amount which shall be the product obtained by
multiplying the annual Salary which was paid to Xxxxxxxx for the immediately
preceding twelve months by the lesser of (a) 106% or (b) a fraction, the
numerator of which is the Consumer Price Index (as hereinafter defined) for the
month of February immediately preceding such adjustment date, and the
denominator of which is the Consumer Price Index for February, 1997 or the month
of February immediately preceding the most recent date on which the Salary was
adjusted, whichever is later. The amount of such increase shall be determined
by the Company as soon as reasonably practicable after the Consumer Price Index
for the month of February immediately preceding each adjustment date becomes
available. The delay or failure of the Company to compute and pay to Xxxxxxxx
any increases in the Salary to be made pursuant to this Section 4.a. shall not
impair the continuing obligation of the Company to pay the increased portion of
the Salary resulting from such adjustments. In no event shall the Salary be
decreased as a result of this Section 4.a. For purposes of this Agreement, the
term "Consumer Price Index" shall mean the "Consumer Price Index--U.S. City
Average For All Items For All Urban Consumers (1982-1984 = 100)" (the "CPI-U")
published monthly in the "Monthly Labor Review" by the Bureau of Labor
Statistics of the United States Department of Labor (the "Labor Bureau"). If
the CPI-U is discontinued, "Consumer Price Index" shall refer to comparable
statistics on the purchasing power of the consumer dollar published by the Labor
Bureau or by another agency of the United States Government selected by the
Company.
b. Net Cash Flow Payment. In addition to the Salary described in
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Section 4.a. above, above, the Company shall, within ninety (90) days after the
end of each calendar year during the term of this Agreement commencing on
January 1, 1997 (each such calendar year is referred to as a "Net Cash Flow
Period"), pay to Xxxxxxxx as an incentive payment (the "Net Cash Flow Payment")
an amount equal to three percent (3%) of the Net Cash Flow, as defined below,
from each Project, as defined below, in which the Company, or any of its wholly-
owned subsidiaries, engaged or was actively involved during the Net Cash Flow
Period for which such payment is made.
(1) For purposes of this Agreement," Net Cash Flow" shall mean,
separately with respect to each Project in which the Company or any of its
wholly-owned subsidiaries was engaged or actively involved during the Net Cash
Flow Period for which such Net Cash Flow Payment is being calculated, the excess
of Revenue, as defined below, over Costs, as defined below, less Prior Net Cash
Flow, as defined below. The Net Cash Flow shall be reviewed and audited by the
Company's independent certified public accountants (currently Coopers & Xxxxxxx)
as to each Project within ninety (90) days after the end of each calendar year
during the term of this Agreement. The Net Cash Flow Payment made for each
calendar year during the term of this Agreement shall be based upon the results
of the annual audit by the Company's independent certified public accountants.
(i) For purposes of calculating Net Cash Flow, Revenueo shall mean
all income or receipts received by the Company with respect to a Project from
the inception of the Project through the end of the Net Cash Flow Period for
which the Net Cash Flow is being calculated, including, without limitation, all
gross sales proceeds and other consideration from property sold as part of the
Project, all operating revenues derived from such Project, and all income
received with respect to services rendered pursuant to such Project.
(ii) For purposes of calculating Net Cash Flow, Costso shall mean all
costs and expenses directly or indirectly incurred with respect to a Project, or
allocated to such Project on an equitable basis, from the inception of such
Project through the end of the Net Cash Flow Period for which the Net Cash Flow
Payment is being calculated, including, without limitation, (a) the adjusted
book basis of the assets and property sold and the general and administrative
expenses of the Company equitably allocated to the Project (including an
equitable allocation of the salary and benefits of Xxxxxxxx and other employees
who have rendered services with respect to such Project), and (b) the total
amount of all costs, fees and interest incurred by the Company on borrowed funds
which are invested in the Project (including an imputed interest cost which
shall be calculated on all non-borrowed funds of the Company which are invested
in the Project but which imputed interest cost shall not be calculated on any of
the Revenue with respect to such Project which Revenue is invested by the
Company in the Project. The
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imputed interest cost shall be calculated from the date of actual expenditure of
such non-borrowed funds by the Company until the date such non-borrowed funds
are returned to the Company from the Revenue generated by the Project, utilizing
an annual rate of interest equal to the prime rate of interest announced from
time to time by the bank or financial institution then used by the Company for
its banking needs, plus two percent (2%) per annum).
(iii) For purposes of calculating Net Cash Flow, Prior
Net Cash Flowo shall mean, with respect to a Project, the cumulative historical
Net Cash Flow from the inception of such Project through the end of the Net Cash
Flow Period immediately preceding the Net Cash Flow Period for which the Net
Cash Flow Payment is being calculated.
(2) For purposes of this Agreement, "Project" shall mean each separate
real estate development or any specifically identifiable phase thereof, or each
separate business enterprise of the Company, in which the Company or any of its
wholly-owned subsidiaries is engaged as of September 1, 1993 and all real estate
developments and business enterprises in which the Company or any of its wholly-
owned subsidiaries is engaged during the term of this Agreement, with respect to
which, in each case (i) the Company has received all necessary approvals and
permits from the applicable public authorities, and (ii) the Company, as
authorized by the Board of Directors, has commenced a development and marketing
program, and (iii) either the Company's equity funds have been allocated or
external financing has been arranged. Notwithstanding the foregoing sentence,
the term "Project" shall also include any separate real estate development
project listed from time to time on Exhibit "B" attached hereto or a
specifically identifiable phase of any such project which is sold in its
entirety in a single sale because of its development potential, even if such
separate real estate development project or phase does not otherwise satisfy the
three requirements set forth in the preceding sentence as essential elements of
a "Project." The term "Project" shall not include specific real estate
developments or business enterprises in which the Company or any of its wholly-
owned subsidiaries was actively involved prior to September 1, 1991. With
respect to large developments or master-planned projects, such as Flagstaff or
Bonanza Flats, each phase of such development shall be treated as a separate
Project for purposes of calculating the Net Cash Flow Payment, and an equitable
(prorata or value based) portion of the accrued costs with respect to such
development shall be allocated to each separate phase thereof, for purposes of
calculating the Net Cash Flow Payment with respect to such Project. As of the
date of this Agreement, the Projects eligible to be considered for a Net Cash
Flow Payment are those Projects specifically identified on Exhibit "B" attached
hereto, which Exhibit "B" may from time to time be amended in writing by the
parties in accordance with the definition of "Project" set forth above.
(3) A Project generating a negative Net Cash Flow through the end of a
Net Cash Flow Period shall be used to offset or reduce the positive Net Cash
Flow which has been generated by other Projects of the Company, and it shall
reduce the amount of the Net Cash Flow Payment as set forth herein.
(4) In the event Xxxxxxxx is not employed during an entire Net Cash
Flow Period, the Net Cash Flow and the Net Cash Flow Payment shall be
proportionately reduced to reflect the number of days during such Net Cash Flow
Period that Xxxxxxxx was employed by the Company.
c. Incentive Stock Option Agreement. Attached hereto as Exhibit "C"
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is a copy of the Incentive Stock Option Agreement dated June 27, 1994, as
amended by the Amendment to United Park City Mines Company Incentive Stock
Option Agreement dated as of August 25, 1995 by and between the Company and
Xxxxxxxx, which shall continue in effect pursuant to the terms and conditions
set forth therein. If at any time during the term of this Agreement the
"Capital Stock" of the Company, as such term is defined in the Incentive Stock
Option Agreement, as amended, ceases to be listed on the stock exchange of any
United States public listing agency, such as the New York Stock Exchange or
NASDAQ (any such public listing agency individually referred to herein as a
"Stock Exchange") for a period of ninety (90) consecutive calendar days, then
Xxxxxxxx shall be entitled to give notice to the Company of Xxxxxxxx'x election
to cause the Company to purchase from Xxxxxxxx all of his right, title and
interest arising under the Incentive Stock Option Agreement, provided that
Xxxxxxxx gives to the Company written notice of such election by Xxxxxxxx within
thirty (30) days after the date that the Capital Stock of the Company has not
been listed on any Stock Exchange for a period of ninety (90) consecutive days.
In the event Xxxxxxxx exercises his right to cause the Company to purchase all
of Xxxxxxxx'x right, title and interest under the Incentive Stock Option
Agreement, the purchase price to be paid by the Company to Xxxxxxxx for all of
his right, title and interest arising under the Incentive Stock Option Agreement
shall be an amount equal to the total number of Option Shares which Xxxxxxxx is
then entitled to purchase under the Incentive Stock Option Agreement multiplied
by a dollar amount calculated as follows:
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(i) the closing bid price per share of the Company's Capital Stock on
the date which is five (5) business days prior to the date which is the earlier
to occur of: (i) the date that the Capital Stock of the Company ceases to be
listed on any Stock Exchange, provided that the Capital Stock of the Company
thereafter remains unlisted on any Stock Exchange for a period of ninety (90)
consecutive calendar days, or (ii) the date that the Stock Exchange which then
lists the Capital Stock of the Company announces its intention to discontinue
the listing of the Company's Capital Stock on such Stock Exchange, provided that
another Stock Exchange does not simultaneously announce its commitment to
commence listing the Capital Stock of the Company, with such new listing to
become effective no later than the date the other Stock Exchange discontinues
its listing of the Capital Stock of the Company, and provided further that the
Capital Stock of the Company, as the result of such announcement, ceases to be
listed on any Stock Exchange and thereafter remains unlisted on any Stock
Exchange for a period of ninety (90) consecutive calendar days,
(ii) less the price per share for which Xxxxxxxx is entitled to
purchase the Option Shares under the Incentive Stock Option Agreement.
Such amount shall be calculated and shall be payable by the Company to Xxxxxxxx
in cash no later than thirty (30) days following the date that Xxxxxxxx gives to
the Company written notice of Xxxxxxxx'x election to cause the Company to
purchase all of Xxxxxxxx'x right, title and interest arising under the Incentive
Stock Option Agreement.
d. Employee Benefits. During the Employment Term, Xxxxxxxx shall be
entitled to all employee benefits in effect or that may hereafter be adopted,
which are at least equal to the benefits available to all other salaried
employees or management personnel of the Company, including, without limitation,
the Company's pension or profit-sharing plans, insurance plans (such as health,
accident, dental, life, or disability insurance), paid vacations, paid sick
leave, and holidays. The level of benefits applicable to Xxxxxxxx shall be
determined in the same manner as the level of benefits is determined for all
other salaried employees of the Company.
5. Termination. The Employment Term shall terminate upon the date of the
first to occur of:
a. the date that is three (3) years after the date hereof (the
"Normal Expiration Date");
b. the accidental death of Xxxxxxxx while actively engaged in the
performance of his duties hereunder;
c. the death of Xxxxxxxx from any cause other than an accident
during the active performance of his duties hereunder;
d. the physical or mental disability or illness of Xxxxxxxx that
shall prevent Xxxxxxxx from performing his duties under this Agreement for a
period of at least three (3) consecutive months, as shall be determined in good
faith by the Board of Directors of the Company;
e. the election of the Board of Directors of the Company to
terminate RothwellAEs employment for "Cause" (as defined in this Section 5
below);
f. the election of the Board of Directors of the Company to
terminate RothwellAEs employment without Cause; and
g. fifteen (15) days after written notice from Xxxxxxxx to the
Company to terminate his employment with or without Cause.
For the purpose of this Agreement, the word "Cause" shall be defined to
include, but not be limited to, the following:
(i) negligence, willful misconduct, or dereliction of duty to the
Company;
(ii) conduct that may cause or has caused material damage to the
Company;
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(iii) breach of fiduciary duties to the Company;
(iv) conviction for a criminal felony charge;
(v) drug or alcohol abuse that causes damage to the Company;
(vi) insubordination in refusing to perform work assigned by the Board
of Directors which is reasonably related to the duties of President
and Chief Executive Officer;
(vii) unapproved disclosure of confidential information;
(viii) engaging in a business competitive to the Company other than
the Permitted Outside Activities;
(ix) sexual harassment that causes damage to the Company; or
(x) theft or abuse of Company funds or property.
6. Payments on Termination.
a. In the event this Agreement is terminated pursuant to Sections
5.a, 5.c, 5.d, 5.e, or 5.g above, the Company shall pay to Xxxxxxxx or his
beneficiary or personal representative Xxxxxxxx'x full Salary and the Net Cash
Flow Payment, together with all benefits and other compensation through the date
of termination. Also, in the event this Agreement is terminated pursuant to
Sections 5.a., 5.c. or 5.d. above, the Company shall continue to pay to Xxxxxxxx
or his beneficiary or personal representative the Net Cash Flow Payments with
respect to all of the Projects of the Company which are in existence as of the
date of Xxxxxxxx'x termination, for a period of three (3) years following the
date of termination at the time the same were to become due if the termination
had not occurred. In the event this Agreement is terminated pursuant to
Sections 5.e. or 5.g. above, the Company shall not be obligated to make any Net
Cash Flow Payments beyond the termination date.
b. In the event this Agreement is terminated pursuant to Section 5.b
because of the accidental death of Xxxxxxxx during the active performance of his
duties hereunder, the Company shall pay, as liquidated damages arising out of
the termination of this Agreement, but not as a waiver or release of any other
claims relating to Xxxxxxxx'x death, to Xxxxxxxx'x estate, beneficiary or
personal representative:
(1) Xxxxxxxx'x full Salary and also the entire amount of the accrued
Net Cash Flow Payment through the date of RothwellAEs death, together with all
benefits and other compensation through such date; plus
(2) an amount equal to the aggregate of the Salary to which Xxxxxxxx
would have been entitled for a period of (1) year following the date of
Xxxxxxxx'x death, as if such death had not occurred, all such payments to be
made at the time the same were to become due if the death had not occurred. The
payments provided hereunder shall be in addition to any other payments to which
Xxxxxxxx or his estate would be entitled such as pension benefits and life
insurance proceeds, if any; plus
(3) the Company shall continue to pay to Xxxxxxxx'x beneficiary or
personal representative the Net Cash Flow Payments with respect to all of the
Projects of the Company which are in existence as of the date of RothwellAEs
termination for a period of three (3) years following the date of RothwellAEs
death at the time the same were to become due if RothwellAEs death had not
occurred.
c. In the event this Agreement is terminated pursuant to Section 5.f
above, the Company shall pay to Xxxxxxxx as liquidated damages and not as a
penalty:
(1) Xxxxxxxx'x full Salary and also the entire amount of the accrued
Net Cash Flow Payment in effect prior to the reason for termination through the
date of RothwellAEs termination, together with all benefits and other
compensation through such date; plus
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(2) an amount equal to the aggregate Salary to which Xxxxxxxx would
have been entitled for the remainder of the Employment Term to the Normal
Expiration Date, all such payments to be made at the time the same were to
become due as if the termination had not occurred; plus
(3) the Company shall continue to pay to Xxxxxxxx or to Xxxxxxxx'x
beneficiary or personal representative the Net Cash Flow Payments with respect
to all of the Projects of the Company which are in existence as of the date of
RothwellAEs termination for a period of three (3) years following the date of
RothwellAEs termination at the time the same were to become due if the
termination had not occurred.
Xxxxxxxx shall not be required to mitigate the amount of any payment
provided for in this Section 6 by seeking other employment or otherwise, nor
shall the amount of any payment or benefit provided for in this Section 6 be
reduced by any compensation or retirement benefits heretofore or hereafter
earned by Xxxxxxxx as a result of employment by any other person or business
entity.
7. Sale, Merger or Business Reorganization Involving the Company. In the
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event that as the result of a sale, merger or other business reorganization or
acquisition involving the Company which results in the termination or material
adverse alteration of Xxxxxxxx'x employment, as set forth in this Agreement, the
Company shall pay or shall cause the surviving business entity to pay to
Xxxxxxxx as liquidated damages and not as a penalty:
x. Xxxxxxxx'x full Salary and also the entire amount of the accrued
Net Cash Flow Payment in effect prior to the effective date of such sale, merger
or other business reorganization through such date, together with all benefits
and other compensation through such date; plus
b. An amount equal to the aggregate Salary to which Xxxxxxxx would
have been entitled for a period of the longer of (i) the remainder of the
Employment Term to the Normal Expiration Date or (ii) one year following the
effective date of such sale, merger or other business reorganization; plus
c. the Company shall pay or cause the surviving business entity to
pay to Xxxxxxxx the Net Cash Flow Payments for a period of three (3) years
following the date of such sale, merger or other business reorganization with
respect to all of the Projects of the Company which are in existence as of the
effective date of such sale, merger or other business reorganization. Projects
in existence are those which meet the definition of Projects in Section 4.c.
as of the applicable date.
d. All such payments shall be made at the time the same were to
become due as if the sale, merger or other business reorganization had not
occurred.
x. Xxxxxxxx shall not be required to mitigate the amount of any
payment provided for in this Section 7 by seeking other employment or otherwise,
nor shall the amount of any payment or benefit provided for in this Section 7 be
reduced by any compensation or retirement benefits heretofore or hereafter
earned by Xxxxxxxx as a result of employment by any other person or business
entity.
8. Indemnification. If Xxxxxxxx is made a party or is threatened to be
made a party to, or is involved in, any action, suit or proceeding, whether
civil, criminal, administrative or investigative, by reason of the fact that he
is or was an employee, officer or director of the Company, or is or was serving
at the request of the Company, Xxxxxxxx shall be indemnified and held harmless
by the Company to the fullest extent authorized by the Company's Certificate of
Incorporation, Bylaws and the General Corporation Law of the State of Delaware,
as the same exists or may hereafter be amended, against all expenses, liability
and loss, including attorneys' fees, judgments, fines and amounts paid or to be
paid in settlement, reasonably incurred or suffered by Xxxxxxxx directly or
indirectly in connection therewith or in connection with any appeal therefrom,
so long as Xxxxxxxx shall be found to have met the standard of conduct set forth
therein that would allow such indemnification, and such indemnification shall
continue as to Xxxxxxxx after he has ceased to be an employee, officer or
director of the Company, and shall inure to the benefit of his heirs, executors
and administrators. The Board of Directors of the Company will undertake a
review of the Company's Certificate of Incorporation and Bylaws and will
determine, in its sole discretion, what expansion of the Company's
indemnification provisions it deems necessary for the Company's officers and
directors.
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9. Life Insurance. If requested by the Company, Xxxxxxxx shall submit to
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such physical examinations and otherwise take such actions and execute and
deliver such documents as may be reasonably necessary to enable the Company to
obtain life insurance on the life of Xxxxxxxx for the benefit of the Company.
10. Confidentiality. Xxxxxxxx agrees that in performing under the terms of
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this Agreement he will have access to confidential and proprietary information
and records of the Company. Xxxxxxxx agrees that he shall keep all such
information and records confidential and that he shall make no use of any of
such information for any purpose other than the business purposes of the
Company. Xxxxxxxx agrees that he shall not give or provide such information or
records to any third party or use them in any way to compete or to allow a third
party to compete with the Company. The provisions of this Section 10 will
survive the termination or expiration of this Agreement; provided, however, that
Xxxxxxxx'x obligations under this Section 10 shall not relate to information and
records of the Company that become part of the public domain by publication or
otherwise through no fault or action of Xxxxxxxx.
11. Non competition. In the event RothwellAEs employment hereunder is
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terminated pursuant to Section 5.f. above, Xxxxxxxx will neither directly nor
indirectly, including, without limitation, as a paid or unpaid director,
officer, agent, representative, employee of, or consultant to, any enterprise,
or by acting as a proprietor of an enterprise, or by holding any direct or
indirect participation in any enterprise as an owner, partner, limited partner,
joint venturer, stockholder or creditor, enter into or attempt to enter into any
other business activities within the state of Utah of the type and character
engaged in, or competitive with that conducted by, the Company during the
remainder of the Employment Term to the Normal Expiration Date, as if such
termination had not occurred. Notwithstanding the foregoing, Xxxxxxxx'x
ownership, involvement and participation in any of the Permitted Outside
Activities shall not be deemed to be a violation of this Section 11. The
ownership by Xxxxxxxx of one percent (1%) or less of the outstanding securities
of any corporation engaged in a business competing with the Company shall not
constitute a breach of this Section 11. In the event of a breach by Xxxxxxxx of
this Section 11, the Company, in addition to all other rights and remedies it
may have, shall be entitled to preliminary and permanent injunctions restraining
Xxxxxxxx from doing or continuing to do any such act in violation of this
Section 11 without showing or proving any actual damage sustained by the
Company, it being acknowledged and agreed by the parties that the business
relationships and good will and the opportunity to build upon those
relationships is a critical element of this Employment Agreement and that a
breach by Xxxxxxxx of this Section 11 cannot be adequately valued in money terms
and would cause irreparable injury to the Company for which money damages will
not provide an adequate remedy. The provisions of this Section 11 will survive
the termination or expiration of this Agreement.
12. Binding Effect. Xxxxxxxx'x rights and obligations under this
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Agreement shall not be transferable by assignment or otherwise, and any attempt
to do any of the foregoing shall be void. The provisions of this Agreement shall
be binding upon and inure to the benefit of Xxxxxxxx and his heirs and personal
representatives, and shall be binding upon and inure to the benefit of the
Company, its successors and assigns.
13. Miscellaneous. This Agreement is to be governed by the laws of the
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State of Utah, except with respect to Section 8 which shall be governed
according to the General Corporation Law of the State of Delaware. This
Agreement constitutes the full and complete understanding of the parties, and
except as otherwise expressly provided, supersedes all previous agreements on
the subject matters hereof, and may be amended only by a writing executed by the
parties hereto. All notices hereunder shall be made in writing and shall be
effective when addressed to the Company at its principal place of business or
when addressed to Xxxxxxxx at his address contained in the Company's personnel
records, and deposited, postage pre-paid and certified, return receipt
requested, with the U.S. Postal Service. The section headings of this Agreement
are solely for convenience and shall not be considered in its interpretation.
The parties agree that any suit or proceeding in connection with, arising out
of, or relating to this Agreement shall be instituted only in a court (whether
federal or state) located in Utah, and the parties, for the purpose of any such
suit or proceeding, irrevocably submit to the jurisdiction of any such court in
any such suit or proceeding. In any such suit, the losing party shall pay the
prevailing party's costs and expenses of the suit, including reasonable
attorneys' fees.
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AUTHORIZED SIGNATURES
In order to bind the parties to this Agreement, their duly authorized
representatives have signed their names on the date first indicated above.
THE "COMPANY" "XXXXXXXX"
UNITED PARK CITY MINES COMPANY
s/ Xxxx Xxxxxxxx
XXXX XXXXXXXX
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BY: /s/ Xxxxx X. Xxxxx, Xx.
_____________________________
XXXXX X. XXXXX, XX.
ITS: EXECUTIVE VICE PRESIDENT
ATTEST:
/s/ Xxxx X. Xxxxxx
_____________________________
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EXHIBIT "A"
PERMITTED OUTSIDE ACTIVITIES
The Employment Agreement restricts Xxxxxxxx'x business activities to those
exclusively of the Company, unless specifically approved by the Board of
Directors of the Company. The following business activities of Xxxxxxxx are
hereby approved by the Board of Directors of the Company:
(1) President and sole owner of Realty Advisors, Inc. ("RA"). RA holds a
brokers license in the State of Utah, and is a member of the Park City Board of
Realtors, the Salt Lake Board of Realtors, and other professional organizations.
It is understood that RA will not be actively engaged in the real estate
development or brokerage business.
(2) Vice President and minority shareholder of Iron Mountain Alliance Inc.
and White Pine Canyon Corp. and also a member of Black Diamond Partners, L.C., a
Utah limited liability company. It is understood that Xxxxxxxx'x involvement in
these entities will be passive investment and shall not be in conflict with
Xxxxxxxx'x obligations under the Employment Agreement.
(3) Passive securities and real estate investments.
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EXHIBIT "B"
LIST OF PROJECTS OF THE COMPANY AS OF JUNE 1, 1997
1. Morning Star Estates Subdivision
2. Hidden Xxxxxxx Subdivision
3. Flagstaff Mountain of Deer Valley
4. Bonanza Mountain Resort
5. Snake Creek Acreage
6. Deer Crest/Pioche 12 Lots
7. Park City Silver Mine Adventure
8. Ontario Water Company
Note: This Exhibit specifically does not include:
1. Company Ski Lease income; and
2. Tunnel maintenance performed for Park City Municipal Corporation.
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EXHIBIT "C"
COPY OF THE INCENTIVE STOCK OPTION
AGREEMENT AND THE AMENDMENT THERETO
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