Exhibit 10.2
Xxxxxx Employment Agreement
EMPLOYMENT AGREEMENT
This employment agreement ("Agreement") is made and entered into as of this date
by and between TIDELANDS OIL & GAS CORPORATION ("Corporation"), and XXXXXX
XXXXXX ("Employee").
WHEREAS, Employer and Employee desire that the term of this Agreement begin on
October 18, 2004 ("Effective Date").
WHEREAS, Employer desires to employ Employee as its Vice President of Gas
Markets and Supply and Employee is willing to accept such employment by
Employer, on the terms and subject to the conditions set forth in this
Agreement.
NOW THEREFORE, IT IS AGREED AS FOLLOWS:
Section 1. Duties. During the term of this Agreement, Employee agrees to be
employed by and to serve Employer as its Vice President Gas Markets & Supply,
and Employer agrees to employ and retain Employee in such capacities. Employee
shall devote a substantial portion of his business time, energy, and skill to
the affairs of the Employer as Employee shall report to the Employer's President
and CEO.
Section 2. Term of Employment.
2.1 Definitions. For the purposes of this Agreement the following terms shall
have the following meanings:
A. "Termination For Cause" shall mean termination by Employer of
Employee's employment by Employer by reason of Employee's willful dishonesty
towards, fraud upon, or deliberate injury or attempted injury to, Employer or by
reason of Employee's willful material breach of this Agreement which has
resulted in material injury to Employer.
B. "Termination Other Than For Cause" shall mean termination by
Employer of Employee's employment by Employer (other than in a Termination for
Cause) and shall include constructive termination of Employee's employment by
reason of material breach of this Agreement by Employer, such constructive
termination to be effective upon notice from Employee to Employer of such
constructive termination.
C. Voluntary Termination" shall mean termination by Employee of
Employee's employment by Employer other than (i) constructive termination as
described in subsection 2.1(b), (ii) "Termination Upon a Change in Control," and
(iii) termination by reason of Employee's death or disability as described in
Sections 2.5 and 2.6.
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2.2 Initial Term. The term of employment of Employee by Employer shall be for a
period of three (3) years beginning with Effective Date ("Initial Term"), unless
terminated earlier pursuant to this Section. At any time prior to the expiration
of the Initial Term, Employer and Employee may by mutual written agreement
extend Employee's employment under the terms of this Agreement for such
additional periods as they may agree.
2.3 Termination For Cause. Termination For Cause may be effected by Employer at
any time during the term of this Agreement and shall be effected by written
notification to Employee. Upon Termination For Cause, Employee shall promptly be
paid all accrued salary, bonus compensation to the extent earned, vested
deferred compensation (other than pension pay or profit sharing plan benefits
which will be paid in accordance with the applicable plan), any benefits under
any plans of the Employer in which Employee is a participant to the full extent
of Employee's rights under such plans, accrued vacation pay and any appropriate
business expenses incurred by Employee in connection with his duties hereunder,
all to the date of termination, but Employee shall not be paid any other
compensation or reimbursement of any kind, including without limitation,
severance compensation.
2.4 Termination Other Than For Cause. Notwithstanding anything else in this
Agreement, Employer may effect a Termination Other Than For Cause at any time
upon giving written notice to Employee of such termination. Upon any Termination
Other Than For Cause, Employee shall promptly be paid all accrued salary, bonus
compensation to the extent earned, vested deferred compensation (other than
pension plan or profit sharing plan benefits which will be paid in accordance
with the applicable plan), any benefits under any plans of the Employer in which
Employee is a participant to the full extent of Employee's rights under such
plans (including accelerated vesting, if any, of awards granted to Employee
under the Employer's stock option plan), accrued vacation pay and any
appropriate business expenses incurred by Employee in connection with his duties
hereunder, all to the date of termination, and all severance compensation
provided in Section 4.2, but no other compensation or reimbursement of any kind.
2.5 Termination by Reason of Disability. If, during the term of this Agreement,
Employee, in the reasonable judgment of the Board of Directors of Employer, has
failed to perform his duties under this Agreement on account of illness or
physical or mental incapacity, and such illness or incapacity continues for a
period of more than twelve (12) consecutive months, Employer shall have the
right to terminate Employee's employment hereunder by written notification to
Employee and payment to Employee of all accrued salary, bonus compensation to
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the extent earned, vested deferred compensation (other than pension plan or
profit sharing plan benefits which will be paid in accordance with the
applicable plan), any benefits under any plans of the Employer in which Employee
is a participant to the full extent of Employee's rights under such plans,
accrued vacation pay and any appropriate business expenses incurred by Employee
in connection with his duties hereunder, all to the date of termination, with
the exception of medical and dental benefits which shall continue through the
expiration of this Agreement, but Employee shall not be paid any other
compensation or reimbursement of any kind, including without limitation,
severance compensation.
2.6 Death. In the event of Employee's death during the term of this Agreement,
Employee's employment shall be deemed to have terminated as of the last day of
the month during which his death occurs and Employer shall promptly pay to his
estate or such beneficiaries as Employee may from time to time designate all
accrued salary, bonus compensation to the extent earned, vested deferred
compensation (other than pension plan or profit sharing plan benefits which will
be paid in accordance with the applicable plan), any benefits under any plans of
the Employer in which Employee is a participant to the full extent of Employee's
rights under such plans, accrued vacation pay and any appropriate business
expenses incurred by Employee in connection with his duties hereunder, all to
the date of termination, but Employee's estate shall not be paid any other
compensation or reimbursement of any kind, including without limitation,
severance compensation.
2.7 Voluntary Termination. In the event of a Voluntary Termination, Employer
shall promptly pay all accrued salary, bonus compensation to the extent earned,
vested deferred compensation (other than pension plan or profit sharing plan
benefits which will be paid in accordance with the applicable plan), any
benefits under any plans of the Employer in which Employee is a participant to
the full extent of Employee's rights under such plans, accrued vacation pay and
any appropriate business expenses incurred by Employee in connection with his
duties hereunder, all to the date of termination, but no other compensation or
reimbursement of any kind, including without limitation, severance compensation.
2.8 Notice of Termination. Employer may effect a termination of this Agreement
pursuant to the provisions of this Section upon giving thirty (30) days' written
notice to Employee of such termination. Employee may effect a termination of
this Agreement pursuant to the provisions of this Section upon giving thirty
(30) days' written notice to Employer of such termination.
Section 3. Salary, Benefits and Bonus Compensation.
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3.1 Base Salary. As payment for the services to be rendered by Employee as
provided in Section 1 and subject to the terms and conditions of Section 2,
Employer agrees to pay to Employee a "Base Salary" for the twelve (12) calendar
months beginning the Effective Date at the rate of $100,000 per annum payable in
24 equal bi-monthly installments.
3.2 Stock Grant. Employee shall be eligible to receive a common stock grant, at
Employee's option, for each year (or portion thereof) during the term of this
Agreement and any extensions thereof, in the amount of One Hundred Thousand
(100,000) common shares annually. The stock grants will vest every six months at
the rate of 50,000 shares. The first 50,000 shares will vest April 18, 2005 and
each succeeding six months during the term of this Agreement. The Employee will
have the option to have the shares issued under the Employer's Stock Grant and
Option Plan or issued directly outside the plan.
3.3 Additional Benefits. During the term of this Agreement, Employee shall be
entitled to the following fringe benefits:
A. Employee Benefits. Employee shall be eligible to participate in such
of Employer's benefits and deferred compensation plans as are now generally
available or later made generally available to executive officers of the
Employer, including, without limitation, Employer's Stock Grant and Option Plan,
profit sharing plans, annual physical examinations, dental and medical plans,
personal catastrophe and disability insurance, financial planning, retirement
plans and supplementary executive retirement plans, if any. For purposes of
establishing the length of service under any benefit plans or programs of
Employer, Employee's employment with the Employer will be deemed to have
commenced on the Effective Date.
B. Vacation. Employee shall be entitled to two (2) weeks of vacation
during each year during the term of this Agreement and any extensions thereof,
prorated for partial years.
C. Reimbursement for Expenses. During the term of this Agreement,
Employer shall reimburse Employee for reasonable and properly documented
out-of-pocket business and/or entertainment expenses incurred by Employee in
connection with his duties under this Agreement.
Section 4. Severance Compensation.
4.1 Severance Compensation in the Event of a Termination Other Than for Cause.
In the event Employee's employment is terminated in a Termination Other Than for
Cause, Employee shall be paid as severance compensation his full Base Salary (at
the rate payable at the time of such termination), for a period of the remaining
portion of the Initial Term of the Employment contract. The Employee shall be
entitled to an accelerated vesting of any awards granted to Employee under
Employer's Stock Option Plan to the extent provided in the stock option
agreement entered into at the time of grant.
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4.2 No Severance Compensation Upon Other Termination. In the event of a
Voluntary Termination, Termination For Cause, termination by reason of
Employee's disability pursuant to Section 2.6, Employee or his estate shall not
be paid any severance compensation.
Section 5. Payment Obligations. Employer's obligation to pay Employee the
compensation and to make the arrangements provided herein shall be
unconditional, and Employee shall have no obligation whatsoever to mitigate
damages hereunder. If litigation after a Change in Control shall be brought to
enforce or interpret any provision contained herein, Employer, to the extent
permitted by applicable law and the Employers' Articles of Incorporation and
Bylaws, hereby indemnifies Employee for Employee's reasonable attorneys' fees
and disbursements incurred in such litigation.
Section 6. Confidentiality. Employee agrees that all confidential and
proprietary information relating to the business of Employer shall be kept and
treated as confidential both during and after the term of this Agreement, except
as may be permitted in writing by Employer's Board of Directors or as such
information is within the public domain or comes within the public domain
without any breach of this Agreement.
Section 7. Withholdings. All compensation and benefits to Employee hereunder
shall be reduced by all federal, state, local and other withholdings and similar
taxes and payments required by applicable law.
Section 8. Indemnification. In addition to any rights to indemnification to
which Employee is entitled to under the Employer's Articles of Incorporation and
Bylaws, Employer shall indemnify Employee at all times during and after the term
of this Agreement to the maximum extent permitted under Nevada Revised Statutes
or any successor provision thereof and any other applicable state law, and shall
pay Employee's expenses in defending any civil or criminal action, suit, or
proceeding in advance of the final disposition of such action, suit or
proceeding, to the maximum extent permitted under such applicable state laws.
TIDELANDS OIL & GAS CORPORATION
___________________________
By: Xxxxxxx Xxxx
XXXXXX X. XXXXXX
___________________________
Xxxxxx X. Xxxxxx
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