EMPLOYMENT CONTRACT
EXHIBIT
99.1
This
Interim Employment Contract (the "Agreement") is made and entered into effective
as of June 4, 2005 by and between Ness Energy International, Inc. (“NESS”) and
Rock Oil Energy of Texas, Inc. (“NESS”, “ROCK”, or together the “Companies”),
and Xxxx X. Xxxxxx ("Xxxxxx"). The Companies and Xxxxxx are sometimes hereafter
collectively referred to as the "Parties" and singularly as a
"Party."
Witnesseth:
Whereas,
the
Companies desire to obtain the contracted services of Xxxxxx in the capacity
of
Executive Vice President & Chief Operating Officer for both NESS and ROCK;
and
Whereas,
Xxxxxx
desires to obtain compensation for these efforts on behalf of the Companies;
and
Whereas,
the
Agreement supercedes the Consulting Agreement dated May 16, 2005 effective
the
date above-referenced; and
Whereas,
the
Parties agree to negotiate more definitive terms as soon as
possible;
Now,
therefore,
for and
in consideration of the mutual obligations and promises contained herein,
the
Parties hereby agree as follows:
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1.
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Duties
of Xxxxxx.
Xxxxxx agrees to perform duties in the following professional areas
for
the Companies:
|
| (a) |
Develop
a general strategy for identifying potential sources of funds such
as
drilling acreage promotion, equity capital, or debt
financing.
|
| (b) |
Both
parties understand and acknowledge that Xxxxxx is not a registered
broker/dealer under federal or state securities laws, and that any
assistance given to the Companies by Xxxxxx or in obtaining capital
is
limited in all respects to activities which do not require such
registration.
|
| (c) |
Assist
in briefing potential investors, evaluating such entities, providing
marketing materials and strategy, consulting with the Companies to
evaluate their risks and potential, and other such indirect support
as
required.
|
| (d) |
Assist
in implementing the Companies’ overall integrated marketing program as
mutually agreed, including, but not limited to assisting with due
diligence on the Companies’ assets.
|
| (e) |
Assist
in reviewing operational procedures and strategy in all areas of
the
Company including but not limited to drilling procedures and operations,
and title and land management procedures.
|
| (f) |
Attend
to other duties and responsibilities as delegated by the Companies’
respective President and Chief Executive
Officer.
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The
Parties acknowledge and agree that Xxxxxx is required to perform services
on a
full-time basis as per and in accordance with the Companies’ ethics
policies.
| 2. |
Term.
The term of this Agreement shall commence on the date hereof, and
continue
until November 30, 2005 (“Term Expiry”), unless extended by mutual written
agreement of the Parties. This Agreement may be terminated for cause
(“Termination”) by either party upon thirty (30) days’ prior written
notice. Notwithstanding anything contained herein to the contrary,
Performance Compensation (See Section 3, iv and Appendix - I) earned
under
the terms specified herein is payable regardless of Termination by
the
Companies’ until November 30, 2005 (i.e., the Company obtains funds (as
set forth herein) or increases oil & gas production, Consultant shall
be entitled to Performance Compensation to November 30, 2005 as set
forth
herein regardless of termination of the Agreement before Term Expiry).
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| 3. |
Compensation
& Expenses.
During the term of this Agreement, Xxxxxx shall be compensated on
the
following basis:
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Fees:
To
be paid as detailed below.
| i. |
Wages:
$11,000 payable bi-monthly from June 4, 2005 (pro-rata for June)
until
November 30, 2005 by NESS.
|
| ii. |
Benefits:
Standard NESS and/or ROCK benefits
package.
|
| iii. |
Performance
Compensation: See Appendix I - Performance
Compensation.
|
| iv. |
Expenses:
As determined and approved from time to time.
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| 4. |
Nature
of the Relationship.
Xxxxxx shall be a full time staff member of both NESS and ROCK, allocating
his time between the Companies as required. Xxxxxx shall use his
best
professional judgment and discretion in performing his duties.
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| 5. |
Indemnification.
The Parties hereby agree to indemnify and hold each other harmless
from
and against any and all liabilities, claims, causes of actions, costs
and
expenses, in any way arising from or relating to the acts or omissions
of
each other, including any liability relating to actions taken or
decided
upon prior to Xxxxxx’ hiring by the Companies. Additional indemnification
provisions shall be negotiated as needed from time to time However,
it is
understood that both NESS and ROCK will take whatever measures are
required on a best efforts basis to fully indemnify Xxxxxx in a manner
commensurate with market-based indemnification provisions, to the
maximum
extent provided for by law and in accordance with the Ness’s and Rock’s
respective by-laws and certificates of
incorporations.
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| 7. |
Choice
of Laws: Jurisdiction: Venue.
The Agreement is being delivered in the State of Texas and shall
be
construed in accordance with and governed by the laws of such State,
without regard to principles of conflicts of laws.
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| 8. |
Alternative
Dispute Resolution.
The
parties hereto hereby knowingly, voluntarily, and irrevocably agree
that
any disputes or conflicts in any way arising out of or relating to:
(I)
this Agreement; or (II) the performance or breach of any of the matters
described herein, may be mediated or arbitrated, at the written election
of either party hereto. If a party makes a written election to mediate
under this paragraph, but mediation efforts fail to resolve the subject
dispute(s) between the parties, either party may elect to resolve
the
dispute(s) by binding arbitration; provided that nothing in this
sentence
shall be read to require a party to first elect to mediate any dispute(s)
hereunder prior to electing to arbitrate. If the subject dispute(s)
are
ultimately resolved by arbitration, the parties hereto irrevocably
agree
to be bound by all finding of fact and conclusions of law of the
arbitrator(s) selected. The election of a party under this paragraph
shall
be by delivery of written notice to the opposing party, provided
that if a
legal proceeding relating to the subject dispute has previously been
filed
in any court of competent jurisdiction, then such notice of election
under
this paragraph shall be delivered within thirty (30) days of the
date the
electing party receives service of process in such legal proceeding,
any
such mediation or arbitration shall proceed in accordance with the
rules
of the American Arbitration Association. All federal and state laws
applicable to this agreement relating to arbitration or mediation
of
conflicts shall be fully complied with by the
parties.
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| 9. |
Headings.
Headings used in this Agreement are used for convenience only and
do not
constitute substantive matters to be considered in construing the
terms of
this Agreement.
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| 10. |
Severability.
In case any one or more of the provisions of this Agreement shall,
for any
reason, be held invalid, illegal or unenforceable in any respect,
any
other provisions in this Agreement shall be construed as if such
invalid,
illegal or unenforceable provisions had never been contained herein.
Such
provisions shall be given effect to the maximum extent permitted
by
law.
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| 11. |
Gender.
Whenever the context shall so require, all words used herein shall
be
deemed to include the male, female or neuter gender, and all words
in the
singular shall include the plural, and all plural words include the
singular.
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| 12. |
Waiver.
Forbearance or failure to pursue any legal remedy or right upon default
or
breach hereof shall not constitute waiver of such right, nor shall
any
such forbearance, failure or actual waiver imply or constitute waiver
of
any subsequent default or breach.
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| 13. |
Counterparts.
This Agreement may be executed simultaneously in one or more counterparts,
each of which shall be deemed an original, and all of which together
shall
constitute one and the same instrument.
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| 14. |
Confidential
Information.
As determined and approved from time to
time.
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| 15. |
Amendments.
This Agreement may not be altered, modified or amended except pursuant
to
a written instrument executed by all Parties
hereto.
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| 16. |
Construction
of Agreement.
The Parties hereto acknowledge and agree that neither this Agreement
nor
any of the other documents executed in connection herewith shall
be
construed more favorably in favor of one than the other based upon
which
Party drafted the same, it being acknowledged that all Parties hereto
contributed substantially to the negotiation and preparation of this
Agreement and the documents executed in connection
herewith.
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| 17. |
No
Third-Party Beneficiaries.
Except as otherwise expressly set forth in this Agreement and except
for
any sums that may be due and owing Xxxxxx’ heirs and beneficiaries under
Section 3 , no person or entity not a party to this Agreement shall
have
rights under this Agreement as a third-party beneficiary or
otherwise.
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In
witness whereof,
the
Parties hereby have duly executed this Agreement effective as of the day
and
year first above written.
Ness
Energy International, Inc.
0000
Xxxx
X-00 Xxxxxxx Xx.
Xxxxxx
Xxxx, XX 00000
By:
\s\
Sha Xxxxxxxx
Name:
Sha
Xxxxxxxx
Title:
President/CEO
Rock
Oil
Energy of Texas, Inc.
0000
Xxxx
X-00 Xxxxxxx Xx.
Xxxxxx
Xxxx, XX 00000
By:
\s\
Sha Xxxxxxxx
Name:
Sha
Xxxxxxxx
Title:
President/CEO
Xxxx
X.
Xxxxxx
0000
Xxxxxx Xxxxx Xxx
Xxxxxxxx
Xxxx, XX 00000
By:
\s\
Xxxx X. Xxxxxx
Name: Xxxx
X.
Xxxxxx
APPENDIX
I - Performance Compensation
The
following Performance Compensation is available to Xxxxxx on the following
terms:
| I. |
All-In
Efforts Clarification:
The Parties acknowledge and agree that the Performance Compensation
owed
is calculated on an “all-in efforts” basis. All Fund Raising occurring
during the term of the Contract is to be considered in the calculations
of
Performance Compensation regardless of the source of origination.
All
Production Growth over the below-noted Base Production regardless
of the
source of origination shall also be considered in the calculations
of
Performance Compensation.
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| II. |
Calculation
of Gas Equivalent:
The production of one barrel of oil per day shall equate to 6,000
cubic
feet of gas per day. This unit is called cubic feet of gas equivalent
per
day (“cfge/day”) and can be added to the production of cubic feet of gas
per day to determine total net cfge/day for reference to the below-noted
calculations. Revenues derived from royalties or overrides shall
be
converted to cfge/day on a mutually agreed basis.
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| III. |
Fund
Raising:
For every gross dollar raised (before fees of any kind), which includes
but is not limited to both well promotion and general corporate financing,
1/6 (one-sixth) shares of Ness Energy International, Inc. common
stock
(restricted) will be conveyed to Xxxxxx. For convenience, after each
completed and funded financing, shares owed will be calculated to
the
nearest whole-number, rounding up from 0.5 and be payable within
30 days.
EXAMPLE: $2 million gross financing completed (whether on promoted
drilling, corporate bank financing, or corporate equity financing,
etc.);
333,333.33 (2,000,000 multiplied by 1/6) would be rounded down to
333,333
shares to be conveyed.
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| IV. |
Production
Growth:
The Ness Energy International, Inc. base net production (“Base
Production”) at the time of contract signing is deemed to be 550,000
cfge/day. For any Production Growth over Base Production in increments
of
100,000 cfge/day, after continuous production over 30 days (or 28
days or
31 days depending on the days in any given month), 166,667 shares
of Ness
Energy International, Inc. common stock (restricted) will be conveyed
to
Xxxxxx. Such calculations shall be made within 15 days of month end
for
the previous month (“Calculation Date”). Shares to be conveyed based upon
this calculation shall be conveyed within 30 days of Calculation
Date. No
deductions to shares conveyed may be made based upon a fall in daily
production below Base Production. However, Base Production is never
adjusted downward, only upward based upon Production Growth. Only
Production Growth over the initial or adjusted Base Production is
compensated. EXAMPLE: July 2005 average daily net production is calculated
as 767,000 cfge/day; Production Growth equates to 217,000 cfge/day
(767,000 less 550,000); Consultant is conveyed 333,334 shares (200,000
divided by 100,000 equals 2; 2 multiplied by 166,667 shares equals
333,334); the new level of Base Production is set at 750,000 cfge/day
(550,000 plus 200,000), which is never adjusted downward if monthly
production were to fall below this number.
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| V. |
Total
Shares Available:
Under no circumstances, during the term of this Agreement can the
total
number of Ness Energy International, Inc. common stock conveyed to
Xxxxxx
exceed ten million (10,000,000). However, the number of shares conveyed
to
Xxxxxx under the terms of Performance Compensation may be calculated
on
the basis of any combination of Fund Raising and/or Production
Growth.
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