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EXHIBIT 10.1
SEVERANCE AWARD AGREEMENT
This Severance Award Agreement (this 'Agreement') is dated as of December
30, 2008, by and between and Pyramid Oil Company, a California corporation
(the 'Company'), and Xxxx Xxxxxxxxx ('Executive') and together, the 'Parties.'
1. AWARD. In consideration of the many years of service that
Executive has performed for and on behalf of the Company, the Company hereby
awards to Executive a supplemental payment in connection with his future
severance of employment with the Company which is in addition to any other
benefits under any plans or agreements with the Company or which he has the
right to receive or which the Company may elect to grant to him at such time.
2. NATURE OF AWARD. On the Payment Date, as hereafter defined,
Executive shall receive at the option of the Company: (i) 25,000 shares (as
amended for any stock split, stock dividend or similar recapitalization
occurring after December 30, 2008) of the Company common stock (the 'Stock');
or (ii) the highest market value of the Stock during the period from the date
of termination of employment until the Payment Date. However, if the
Company's outstanding stock or substantially all of its property is acquired
by another Company (the 'Purchaser') for cash or property other than stock,
the amount to be paid on the Payment Date shall be that amount that is paid or
distributed in the transaction with respect to 25,000 shares of the Company
common stock. If the Company is acquired for the stock of the Purchaser or
for both stock and other property, the Stock shall consist of the shares of
the Purchaser issued in the transaction with respect to 25,000 shares of the
Company common stock and the amount payable on the Payment Date shall be such
Purchaser's shares or their fair market value in cash and any other property
issued in the transaction in which the Purchaser acquired the Company.
3. PAYMENT DATE. The Payment Date shall be either the date that is
the first day after six months have elapsed from the date of the severance of
Executive's employment with the Company or, if the Executive dies prior to end
of such period, the seventh day after the date of his death, whichever is
shorter.
4. EXISTENCE OF THE COMPANY. If the Company shall not be in
existence on the Payment Date or if the Purchaser has not assumed the
obligations of the Company to Executive under this Agreement, the amount of
cash and/or securities that Executive is entitled to receive on the Payment
Date shall be placed in escrow for the benefit of Executive.
5. ELECTION TO ISSUE STOCK; EXECUTIVE'S OPTION. If the Company
elects to issue the Stock to the Executive rather than to pay the fair market
value of the Stock to the Executive, such Stock shall be registered at the
Company expense before the issuance of the Stock or, if that is not possible
for any reason, as soon as may be practicable. Notwithstanding the forgoing,
if the Stock is not registered within 90 days from the date of its issuance,
the Executive will have the option to sell the Stock to the Company at its
fair market value on the date that the Executive gives notice of the exercise
of the option.
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6. DETERMINATION OF FAIR MARKET VALUE. For purposes of this
Agreement, the fair market value of the Stock shall be determined as follows:
a. If the stock of the Company is listed on a securities
exchange or is regularly quoted by a recognized securities dealer, and selling
prices are reported, its fair market value shall be the closing price of such
stock on the date the value is to be determined, but if selling prices are not
reported, its fair market value shall be the mean between the high bid and
low asked prices for such stock on the date the value is to be determined (or
if there are no quoted prices for the date of grant, then for the last
preceding business day on which there were quoted prices).
b. In the absence of an established market for the stock, the
fair market value thereof shall be determined in good faith by the Board of
Directors of the Company, with reference to the Company's net worth,
prospective earning power, dividend-paying capacity, and other relevant
factors, including the goodwill of the Company, the economic outlook in the
Company's industry, the Company's position in the industry, the Company's
management, and the values of stock of other corporations in the same or a
similar line of business.
7. GENERAL PROVISIONS.
a. SEVERABILITY. If any provision of this Agreement or any part
of any such provision is held under any circumstances to be invalid or
unenforceable in any jurisdiction, then (i) such provision or part thereof
shall, with respect to such circumstances and in such jurisdiction, be deemed
amended to conform to applicable laws so as to be valid and enforceable to the
fullest possible extent, (ii) the invalidity or unenforceability of such
provision or part thereof under such circumstances and in such jurisdiction
shall not affect the validity or enforceability of such provision or part
thereof under any other circumstances or in any other jurisdiction, and
(iii) the invalidity or unenforceability of such provision or part thereof
shall not affect the validity or enforceability of the remainder of such
provision or the validity or enforceability of any other provision of this
Agreement. Each provision of this Agreement is separable from every other
provision of this Agreement, and each part of each provision of this Agreement
is separable from every other part of such provision.
b. GOVERNING LAW; VENUE. This Agreement shall be construed in
accordance with, and governed in all respects by, the laws of the State of
California (without giving effect to principles of conflicts of laws). Any
legal action or other legal proceeding relating to this Agreement or the
enforcement of any provision of this Agreement may be brought or otherwise
commenced in any state or federal court located in the County of Xxxx in the
State of California.
c. WAIVER OF JURY TRIAL. THE PARTIES IRREVOCABLY WAIVE THE
RIGHT TO A JURY TRIAL IN CONNECTION WITH ANY LEGAL PROCEEDING RELATING TO THIS
AGREEMENT OR THE ENFORCEMENT OF ANY PROVISION OF THIS AGREEMENT.
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d. WAIVER. No failure of any of the Parties to exercise any
power, right or privilege under this Agreement, and no delay on the part of
any of the Parties in exercising any power, right or privilege under this
Agreement, shall operate as a waiver of such power, right or privilege; and no
single or partial exercise of any such power, right or privilege shall
preclude any other or further exercise thereof or of any other power, right or
privilege. Neither of the Parties shall be deemed to have waived any claim
arising out of this Agreement, or any power, right or privilege under this
Agreement, unless the waiver of such claim, power, right or privilege is
expressly set forth in a written instrument duly executed and delivered, and
any such waiver shall not be applicable or have any effect except in the
specific instance in which it is given.
e. NONTRANFERABILITY. The rights of the Executive under this
Agreement are not transferable except by will or the laws of descent and
distribution unless the prior written consent of the Company is obtained.
f. CAPTIONS. The captions contained in this Agreement are for
convenience of reference only, shall not be deemed to be a part of this
Agreement and shall not be referred to in connection with the construction or
interpretation of this Agreement.
g. AMENDMENT. This Agreement may not be amended, modified,
altered or supplemented other than by means of a written instrument duly
executed and delivered on behalf of the Parties.
h. NOTICES. Any notice, demand or request required or permitted
to be given by either of the Parties pursuant to the terms of this Agreement
shall be given in writing by hand delivery, by facsimile (at the telephone
number set forth below) or three days after sending such notice by certified
or registered mail to address set forth below, Attention: Corporate Secretary,
in the case of notice to the Company.
COMPANY EXECUTIVE
Pyramid Oil Company
By: XXXXXXXX X. XXXXXX XXXX X. XXXXXXXXX
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Xxxxxxx X. Xxxxxx Xxxx X. Xxxxxxxxx
Chairman of the Board President and CEO
Pyramid Oil Company Xxxx X. Xxxxxxxxx
X X Xxx 000 X X Xxx 000
Xxxxxxxxxxx, XX 00000 Xxxxxxxxxxx, XX 00000
(000) 000-0000 (000) 000-0000
