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EXHIBIT 10.13
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT (this "Agreement") is made as of June __,
1999, by and between The Oil & Gas Asset Clearinghouse, Inc., a Texas
corporation (the "Company"), and Xxxx X. Xxxxxxx, an individual ("Executive").
RECITALS
WHEREAS, the Company desires to employ Executive as the
Chairman of the Board and Executive Vice President of Technology of the Company,
and Executive desires to accept such employment on the terms and conditions
hereinafter set forth;
WHEREAS, the Company has agreed with Employee that within
twenty-four (24) months of the date hereof, the Company shall offer Employee the
position of President of the Company although Employee shall be under no
obligation to accept such position;
WHEREAS, in the course of his employment, Executive will or
has gained knowledge of the business, affairs, and operating results of the
Company and any subsidiaries, will be trained at the expense of the Company in
the operation and management of the business of the Company and the marketing
and sale of the Company's services through the use of certain proprietary
systems of the Company, and will have access to lists of the Company's clients
and prospective clients and their needs, pricing and capabilities; and
WHEREAS, the data obtained by Executive while employed by the
Company concerning the business, affairs or operating results of the Company or
any of its subsidiaries, including, without limitation, customer lists,
databases, proprietary source codes, system processes, trade secrets, buyer and
seller lists, profiles and information and historic property sale information
and statistics ("Confidential Information") is unique and valuable to the
Company and the Company would suffer irreparable harm if Executive were to
divulge such Confidential Information to those in competition with the Company
or use such knowledge, information and business acumen in competition with the
Company.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. Employment. The Company shall employ Executive, and
Executive accepts employment with the Company, upon the terms and conditions set
forth in this Agreement for the period beginning on the date of this Agreement
and ending as provided in Section 4 hereof (the "Employment Period").
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2. Position and Duties.
(a) Except as set forth in this Agreement, during the
Employment Period Executive shall serve as the Chairman of the Board and
Executive Vice President of Technology of the Company. The Company's board of
directors (the "Board") shall not require Executive to conduct his primary
business activities outside of Executive's offices in Denver, Colorado, other
than for reasonable business travel.
(b) Executive shall report to the Board and shall perform his
duties and responsibilities to the best of his abilities in a diligent,
trustworthy, businesslike and efficient manner.
(c) All funds and property received by Executive on behalf of
the Company or its affiliates shall be received and held by Executive in trust
for the Company or its affiliates, as the case may be, and Executive shall
account for and remit all such funds and property to the Company or its
affiliates, as the case may be.
3. Base Salary and Benefits.
(a) During the Employment Period, Executive's base salary
shall be $186,000 per annum or such higher rate as the Board may designate from
time to time (the "Base Salary"), which salary shall be payable in regular
installments in accordance with the Company's general payroll practices. During
the Employment Period, the Base Salary shall not be reduced below $186,000 per
annum without the prior written consent of Executive; provided, however, that
Executive agrees to consider in good faith a reduction of the Base Salary below
$186,000 per annum in the event the financial performance of the Company should
so warrant.
(b) During the Employment Period, Executive shall be entitled
to participate in all of the Company's employee benefit programs for which
senior executive employees of the Company are generally eligible; provided,
however, that during the Employment Period, Executive shall be entitled at a
minimum to receive the benefits set forth on Exhibit A attached hereto. If the
benefits set forth in Exhibit A are not available to Executive due to his job
location in Denver, Colorado rather than Houston, Texas, the Company shall
provide benefits substantially similar to the benefits set forth in Exhibit A to
Executive in Denver, Colorado.
(c) During the Employment Period, the Company shall reimburse
Executive for all reasonable expenses incurred by him in the course of
performing his duties under this Agreement which are consistent with the
Company's policies in effect from time to time with respect to travel,
entertainment and other business expenses, subject to the Company's requirements
with respect to reporting and documentation of such expenses.
(d) In addition to the Base Salary, Executive shall be
eligible to receive a bonus following the end of each fiscal year during the
Employment Period. Such bonuses shall be paid
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upon the attainment of certain performance goals as mutually agreeable to
Executive and the Board and are expected to be consistent with the Company's
past practices with respect to performance bonuses; provided, however, that the
award of such bonuses shall ultimately be determined by the Board based on the
Company's performance. Notwithstanding the foregoing, Executive shall be paid a
minimum bonus for each fiscal year commensurate with any such bonuses paid to
Xx. Xxxxxxx X. Xxxxx, Xx. and other senior executive officers of the Company for
such fiscal year, less $20,000; provided, however, that Executive agrees to
consider in good faith a reduction in Executive's bonus in the event the
financial performance of the Company should so warrant. Each such bonus for any
fiscal year shall be paid by the end of the first quarter of the following
fiscal year.
(e) The Company shall have the right to withhold any and all
amounts due and payable to Executive pursuant to the terms of this Agreement and
to apply such amounts to any amounts owed by Executive to the Company.
4. Term.
(a) Unless renewed by the mutual written agreement of the
Company and Executive, the Employment Period shall end on the fifth anniversary
of the date of this Agreement (the "Fifth Anniversary"); provided that (i) the
Employment Period shall terminate prior to such date upon Executive's
resignation, death, Permanent Disability (as defined below) or resignation due
to Constructive Termination (as defined below) and (ii) the Employment Period
may be terminated by the Company at any time prior to such date for Cause (as
defined below) or without Cause.
(b) If the Employment Period is terminated by Executive's
resignation due to Constructive Termination or by the Company without Cause,
Executive shall be entitled to receive that portion of his then current Base
Salary earned through the date of such termination, plus an additional amount
equal to two (2) times his then current Base Salary (the "Severance Payment");
provided, however, that, if Executive has materially breached the provisions of
Sections 5, 6 or 7 hereof, Executive shall not be entitled to the Severance
Payment until such breach, if capable of being cured, is cured by Executive.
(c) If the Employment Period is terminated by the Company for
Cause or is terminated by Executive pursuant to Section 4(a)(i) above other than
by Executive's resignation due to Constructive Termination, Executive shall be
entitled to receive that portion of his then current Base Salary earned through
the date of termination.
(d) The amount of any Base Salary payable pursuant to Sections
4(b) or (c) hereof shall be payable in accordance with the Company's general
payroll practices, and any Severance Payment shall be payable in one lump sum
payment within 60 days following termination of the Employment Period.
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(e) Except as otherwise required by law, all of Executive's
rights to employee benefits and bonuses hereunder (if any) accruing after the
termination of the Employment Period shall cease upon such termination.
(f) For purposes of this Agreement, "Cause" shall mean (i) a
breach of Executive's duty of loyalty to the Company or any of its subsidiaries
as a member of the Board or the board of any subsidiary or any act of fraud
against the Company or any of its subsidiaries, (ii) the commission by Executive
of a felony, a crime involving moral turpitude or other act causing material
harm to the Company's or any of its subsidiaries' standing and reputation, (iii)
Executive's failure or refusal to commence his reasonable best efforts, without
proper legal cause, to follow the directions of the Board after Executive has
been given written notice thereof and fifteen (15) days have elapsed within
which Executive has not executed his reasonable best efforts to follow such
directions of the Board, (iv) Executive's current illegal use of drugs, or (v)
Executive's substandard performance as described below. In the event the Company
incurs operating losses in two (2) consecutive fiscal years, the Board shall be
deemed to have initial grounds to remove Executive for substandard performance.
If the Board (excluding Executive) determines in good faith that such operating
losses of the Company are the result of Executive's substandard performance, the
Board shall give written notice thereof to Executive, and Executive shall have
thirty (30) days to prepare for a meeting with the Board, at which time
Executive may present information with respect to market conditions or any other
factors which Executive deems relevant in assessing the cause of such operating
losses, including, without limitation, evidence that Executive has followed the
directives of the Board in the performance of his duties. After due
consideration of such factors, if the Board (excluding Executive) again
determines in good faith that such operating losses of the Company are the
result of Executive's substandard performance and not the result of other
factors, Executive may be terminated by the Board for Cause. The parties hereby
acknowledge and agree that the determination of whether the criteria for Cause
has been met shall be arbitrable in accordance with the American Arbitration
Association employment dispute rules.
(g) For purposes of this Agreement, "Constructive Termination"
shall mean (i) the assignment to Executive by the Board of duties materially
inconsistent with the normal duties associated with the position of Chairman of
the Board and Executive Vice President of Technology of the Company, (ii) the
occurrence of material acts or conduct on the part of the Board which have as
their purpose forcing the resignation of Executive or preventing him from
performing his duties and responsibilities pursuant to this Agreement, (iii) a
material breach by the Company of any provision of this Agreement which is not
cured within fifteen (15) days after written notice thereof is delivered by
Executive to the Company, or (iv) a default or decrease in the payment to
Executive of the compensation set forth in Section 3 above, except as permitted
herein.
(h) For purposes of this Agreement, "Permanent Disability"
shall mean the inability of Executive to effectively and efficiently perform the
essential functions of his position (with or without reasonable accommodation
from the Company) by reason of mental or physical impairment during (i) any
continuous period of one hundred twenty (120) days, or (ii) one hundred eighty
(180) days in the aggregate during any 12-month period.
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5. Confidential Information. Executive acknowledges that the
Confidential Information is the property of the Company or its subsidiaries, as
the case may be. Therefore, Executive agrees that he shall not disclose to any
unauthorized person or use for his own account any Confidential Information
without the prior written consent of the Board (excluding Executive), unless and
to the extent that the aforementioned matters become generally known to and
available for use by the public other than as a result of Executive's acts or
omissions to act. Executive shall deliver to the Company at the termination of
the Employment Period, or at any other time the Company may request, all
memoranda, notes, plans, records, reports, computer tapes and software and other
documents and data (and copies thereof) relating to the Confidential
Information, Work Product (as defined below) or the business of the Company or
any subsidiary which he may then possess or have under his control.
6. Inventions and Patents. Executive agrees that all
inventions, innovations, improvements, developments, methods, designs, analyses,
drawings, reports and all similar or related information which relates to the
Company's or any of its subsidiaries' business, research and development or
existing or future products or services and which are conceived, developed or
made by Executive while employed by the Company or any of its subsidiaries
("Work Product") belong to the Company or such subsidiary, as the case may be.
Executive will promptly disclose such Work Product to the Board and perform all
actions reasonably requested by the Board (whether during or after the
Employment Period), at the expense of the Company, to establish and confirm such
ownership (including, without limitation, assignments, consents, powers of
attorney and other instruments).
7. Non-Solicitation.
(a) During the Non-Solicitation Period (as determined pursuant
to Section 7(b) below), Executive shall not directly or indirectly through
another entity (i) induce or attempt to induce any employee of the Company or of
any subsidiary of the Company with whom Executive has contact during the
Employment Period to leave the employ of the Company or such subsidiary, as the
case may be, to perform the same or similar services or functions as such
employee performed for the Company or such subsidiary, as the case may be, (ii)
hire any person who was an employee of the Company or of any subsidiary of the
Company with whom Executive has contact during the Employment Period to perform
the same or similar services or functions as such employee performed for the
Company or such subsidiary, as the case may be, or (iii) induce or attempt to
induce any customer, supplier, licensee or other business relation of the
Company or of any subsidiary of the Company with whom Executive has contact
during the Employment Period to cease doing business with the Company or such
subsidiary, as the case may be.
(b) The Non-Solicitation Period shall be determined as
follows:
(i) If termination of the Employment Period
occurs on or prior to the fourth anniversary
of the date of this Agreement (the "Fourth
Anniversary"), then the Non-Solicitation
Period shall begin on the
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date of this Agreement and shall expire on
the date which is two (2) years after the
date of such termination; provided, however,
that in no event shall the Non-Solicitation
Period extend beyond the Fifth Anniversary
pursuant to this Section 7(b)(i).
(ii) If termination of the Employment Period
occurs after the Fourth Anniversary, then
the Non-solicitation Period shall begin on
the date of this Agreement and shall expire
on the sixth anniversary of the date of this
Agreement.
8. Enforcement.
(a) If, at the time of enforcement of Sections 5, 6 or 7
hereof, a court holds that the restrictions stated herein are unreasonable under
circumstances then existing, the parties hereto agree that the maximum period,
scope or geographical area reasonable under such circumstances shall be
substituted for the stated period, scope or area. Because Executive's services
are unique and because Executive has access to Confidential Information and Work
Product, the parties hereto agree that money damages would be an inadequate
remedy for any breach of this Agreement. Therefore, in the event a breach or
threatened breach of this Agreement, the Company or its successors or assigns
may, in addition to other rights and remedies existing in their favor, apply to
any court of competent jurisdiction for specific performance and/or injunctive
or other relief in order to enforce, or prevent any violations of, the
provisions hereof (without posting a bond or other security).
(b) The existence of any claim, demand, action or cause of
action by Executive against the Company or any affiliate of the Company, whether
predicted upon this Agreement or otherwise, shall not constitute a defense to
the enforcement by the Company of its rights under this Agreement.
9. Executive Representations, Warranties and Covenants.
Executive hereby represents and warrants to the Company that (i) the execution,
delivery and performance of this Agreement by Executive does not and will not
conflict with, breach, violate or cause a default under any contract, agreement,
instrument, order, judgment or decree to which Executive is a party or by which
he is bound, (ii) Executive is not a party to or bound by any employment
agreement, noncompete agreement or confidentiality agreement with any other
person or entity, and (iii) upon the execution and delivery of this Agreement by
the Company, this Agreement shall be the valid and binding obligation of
Executive, enforceable in accordance with its terms.
10. Survival. Sections 2(c), 3, 4, 5, 6, 7, 8, 9 and 12 hereof
shall survive and continue in full force in accordance with their terms
notwithstanding any termination of the Employment Period.
11. Notices. Any notice provided for in this Agreement shall
be in writing and shall be either personally delivered, sent by facsimile, sent
by nationally recognized overnight courier
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service or mailed by first class mail, return receipt requested, to the
recipient at the address below indicated:
Notices to Executive:
Xxxx X. Xxxxxxx
0000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
Notices to the Company:
The Oil & Gas Asset Clearinghouse, Inc.
000 X. Xxx Xxxxxxx Xxxxxxx X.
Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attn: President
Fax: (000) 000-0000
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement will be deemed to have been given when so delivered,
sent or mailed.
12. Further Assurances. Executive agrees that, upon
termination of this Agreement for any reason, Executive shall cooperate with the
Company, perform and all reasonable acts and execute, acknowledge and deliver
any and all documents which may be reasonably necessary for Executive or the
Company to comply with federal and state laws, rules and regulations and the
rules and the regulations of the SEC and the NASD with respect to such
termination.
13. Severability. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
14. Complete Agreement. This Agreement, those documents
expressly referred to herein and other documents of even date herewith embody
the complete agreement and understanding among the parties and supersede and
preempt any prior understandings, agreements or representations by or among the
parties, written or oral, which may have related to the subject matter hereof in
any way.
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15. Counterparts. This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.
16. Successors and Assigns. This Agreement is intended to bind
and inure to the benefit of and be enforceable by Executive, the Company and
their respective heirs, successors and assigns, except that Executive may not
assign his rights or delegate his obligations hereunder without the prior
written consent of the Company. The obligations, or any portion thereof, of the
Company as set forth herein may be assigned to or performed through a personnel
management service or similar entity which provides personnel management and/or
staffing services to the Company; provided, however, that no such assignment to
or performance by such service or entity shall relieve the Company from primary
liability hereunder for such obligations.
17. Choice of Law. THIS AGREEMENT SHALL BE GOVERNED BY THE
INTERNAL LAW, AND NOT THE LAWS OF CONFLICTS, OF THE STATE OF TEXAS.
18. Amendment and Waiver. The provisions of this Agreement may
be amended or waived only with the prior written consent of the Company and
Executive, and no course of conduct or failure or delay in enforcing the
provisions of this Agreement shall affect the validity, binding effect or
enforceability of this Agreement.
19. Headings. The headings of the sections of this Agreement
are inserted for convenience only and shall not be deemed to constitute a part
of this Agreement.
20. Construction. The parties hereto have participated jointly
in the negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties hereto and no presumption or burden of
proof shall arise favoring or disfavoring any party by virtue of the authorship
of any of the provisions of this Agreement.
21. Executive and EAE. The Company hereby acknowledges and
agrees that Executive is an officer of Energy Auction Exchange, Inc., a Delaware
corporation and the parent entity of the Company ("EAE"), and in the future may
be an officer or employee of affiliates of EAE and Executive, and in connection
therewith, nothing in this Agreement shall be construed to limit the ability of
Executive and EAE and their affiliates to own, operate, invest in, manage,
control, participate in, consult with, render services for, be employed by or
otherwise engage in businesses which may or may not compete with the business of
the Company and such activities shall not be deemed a breach of the provisions
of this Agreement by Executive so long as Executive does not breach the
provisions of Sections 5, 6 and 7.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first written above.
THE OIL & GAS ASSET CLEARINGHOUSE, INC.
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By:
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Its:
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Xxxx X. Xxxxxxx
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EXHIBIT A
EMPLOYEE BENEFIT PROGRAMS
ADMINISTAFF'S BENEFIT PACKAGE
Medical
Life Insurance
Accidental Death/Dismemberment
Managed Pharmacy Program
Dental
Vision
Employee Assistance Program
Healthy Beginnings
Adoption Assistance
Credit Union
Education Assistance
Voluntary Term and Universal Life Insurance
Administaff 401(k) Plan & Trust
OGAC LONG TERM DISABILITY INSURANCE
A-1
