EXHIBIT 99.1
EMPLOYMENT CONTRACT
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THIS EMPLOYMENT CONTRACT, dated as of November 1, 2005, is entered into by and
between Trend Mining Company, a Delaware corporation, with offices at 0000 Xxxxx
Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000 (the Company), and Xxxxxx X. Xxxxxx,
residing at 0000 X. Xxxxx Xxxxx, Xxxxxxxxx Xxxxxxx, Xxxxxxxx 00000 (the
Employee).
The Company desires to engage Employee to perform services for the Company and
Employee desires to perform such services on the terms and conditions
hereinafter set forth.
I. TERM
The Company agrees to employ Employee, and the Employee agrees to serve, on the
terms and conditions of this agreement, for a period commencing on November 1,
2005, and ending one (1) year from the starting date, subject to termination as
provided in Sections 7, 8 and 9 hereof. The period during which Employee is
employed hereunder is hereafter referred to as "Employment Period". The
Employment Period shall be automatically extended, without further action by
either party, for additional and successive one-year periods commencing November
1st; provided that the Company may deliver a written notice of involuntary
termination pursuant to Section 7 on 90 days' prior written notice.
II. DUTIES AND SERVICES
During the Employment Period, the Employee shall be employed by and shall serve
the Company as its President and Chief Executive Officer. In performance of
Employee's duties, Employee shall be subject to the direction of the Board of
Directors of the Company. At all times during the Employment Period, Employee
shall have powers and duties at least commensurate with Employee's position as
President and Chief Executive Officer of the Company. Employee agrees to his
employment as described in this Section 2 and agrees to devote such of his
business time, energy and skill as shall be necessary to perform the duties of
such positions under this Agreement. Employee shall be available to travel as
the needs of the business reasonably require.
III. COMPENSATION
As full compensation of Employee's services hereunder, the Company shall pay
Employee, during the Employment Period, a salary payable in equal monthly
installments at the annual rate of One Hundred & Twenty Thousand Dollars
($120,000). Nothing contained herein shall preclude Employee from participating
in the present or future employee benefit plans of the Company if Employee meets
the eligibility requirements therefore. In addition, the Company has elected,
from time to time, to provide Employee with certain fringe benefits. The fringe
benefits are currently listed on the attached Schedule of Fringe Benefits.
Notwithstanding anything herein to the contrary, the Company has sole discretion
to modify any fringe benefit by action of the Board, EXCEPT THAT fringe benefits
which are vested by the express terms of any Company Benefit Plan may not be
altered, except in accordance with the terms of such Benefit Plan.
IV. EXPENSES AND VACATION
Employee shall be entitled to reimbursement during the Employment Period for
reasonable travel and other out-of-pocket expenses necessarily incurred in the
performance of Employee's duties hereunder, upon submission and approval of
written statements and bills in accordance with the then regular procedures of
the Company. Employee shall be entitled to reasonable vacations in accordance
with the then regular procedures of the Company's governing executives. Employee
shall be entitled to not less than four (4) weeks of vacation time per year.
V. NON-COMPETITION
This contract does not contain, and shall not be construed to contain, a
non-compete clause.
VI. CONFIDENTIAL INFORMATION
All confidential information which Employee may now possess, may obtain during
or after the Employment Period, or may create prior to the end of the Employment
Period, relating to the financial condition, results of operations, business,
properties, assets, liabilities or future prospects of the Company, shall not be
published, disclosed or made accessible by the Employee to any other person or
entity, either during or after the termination of Employee's employment, or used
by Employee except during the Employment Period in the business and for the
benefit of the Company without prior written permission of the Company. Employee
shall deliver to the Company all tangible evidence of such confidential
information prior to or at the termination of Employee's employment.
VII. INVOLUNTARY TERMINATION
A. Certain Definitions. As used in Sections 7, 8, 9 and 10 of this
Agreement:
1. "Cause" means, and is limited to, (1) action by Employee
involving willful malfeasance, (2) failure to act by Employee
involving material and willful nonfeasance or (3) Employee
being convicted of a felony involving moral turpitude, in each
such case resulting in a material adverse effect on the
Company; provided, however, that Employee's employment shall
not be terminated for "Cause" if such termination took place
as a result of any act or omission believed by the Employee in
good faith to have been in the best interest of the Company.
2. "Change of Control Event" shall mean a change in ownership or
control of the Company effected through any of the following
transactions: (i) the acquisition, directly or indirectly by
any person or related group of persons, of beneficial
ownership of securities possessing more than thirty percent
(30%) of the total combined voting power of the Company's
outstanding securities; (ii) a change in the composition of
the Board over a period of eighteen (18) consecutive months or
less such that fifty percent (50%) or more of the Board
members cease to be directors who either (A) have been
directors during such period continuously since the beginning
of such period or (B) have been unanimously elected or
nominated by the Board for elections as directors during such
period; (iii) a stockholder-approved merger or consolidation
to which the Company is a party and in which (A) the company
is not the surviving entity or (B) securities possessing more
than
thirty percent (30%) of the total combined voting power of the
Company's outstanding securities are transferred to a person
or persons different from the persons holding those securities
immediately prior to such transactions; or (iv) the sale,
transfer or other disposition of all or substantially all of
the Company's assets in complete liquidation or dissolution of
the Company.
3. "Continuing Director" means any person who is either (1) a
Director on January, 2005, or (2) was designated before such
person's initial election as a Director as a continuing
Director by a majority of the continuing Directors.
4. "Director" means a member of the Board of the Company ("the
Board").
5. "Disability" means, as applied to Employee, that (1) Employee
has been totally incapacitated by bodily injury or disease so
as to be prevented thereby from engaging in any occupation or
employment for remuneration or profit, (2) such total
incapacity shall have continued for a period of 3 (three)
consecutive months and (3) such total incapacity will, in the
opinion of a qualified physician mutually acceptable to the
Company and Employee, be permanent and continuous during the
remainder of Employee's life.
6. "Good Reason" means (1) without employee's specific written
consent (A)(i) the assignment to Employee of any duties and
responsibilities, or any limitation of Employee's duties and
responsibilities and status as an officer of the Company
immediately prior to the date of a Change of Control Event or
(ii) any removal of Employee from, or any failure to re-elect
Employee to, and of Employee's positions with the Company
immediately prior to a Change of Control Event, except in
connection with the termination of the employment of Employee
by the Company for Cause or as a result of the death or
Disability of Employee, and (B) the continuance thereof for a
period of not less than 20 days after written complaint
thereof to the Company from Employee; (2) any failure by the
Company to pay, or any reduction by the Company of, the salary
payable to Employee under Section 3 of this Agreement; (3) any
failure by the Company (A) to continue to provide Employee
with the opportunity to participate, on terms no less
favorable than those in effect immediately prior to a Change
of Control Event, in any benefit plan or program in which
Employee was participating immediately prior to the Change of
Control Event, or their equivalent, or (B) to provide Employee
with all other fringe benefits, or their equivalent, from time
to time in effect for the benefit of any of the Company's
salaried employees; (4) the relocation, without Employee's
written consent, of the principal place of Employee's
employment to a location that is more than 25 miles from
Littleton, Colorado; (5) continuing Directors no longer
constitute at least a majority of the Directors constituting
the Board; (6) the failure by the Company to obtain the
specific assumption of this Agreement by a successor or assign
of the Company or by any person acquiring substantially all of
the Company's assets; or (7) any material breach by the
Company of any provision of this Agreement.
7. "Involuntary Termination" means (1) dismissal of Employee by
the Company without Cause or (2) voluntary resignation by
Employee for Good Reason during the Employment Period.
B. Compensation of Employee in the Event of Involuntary Termination. If
Involuntary Termination occurs:
1. The Company shall continue (1) to pay the salary payable to
Employee under Section 3 of this Agreement for a period of one
year from the date of the Involuntary Termination and (2) to
provide the employee benefits (including but not limited to,
life, health and disability coverage but not including any
severance pay benefit other than that provided pursuant to
this Agreement) at levels that were applicable to Employee on
the date immediately prior to the Involuntary Termination, and
2. The Company shall pay Employee (1) all amounts which had
accrued but were not paid prior to the Involuntary Termination
and (2) all amounts payable under then existing employee
benefit plans and programs.
VIII. TERMINATION DUE TO DEATH OR DISABILITY
In the event of Employee's disability, Employee's employment hereunder may be
terminated by the Company upon written notice from the Company to Employee which
shall specify a date not less than 30 days from the date of such notice as the
date on which such termination shall become effective. If Employee's employment
hereunder is terminated because of the death or disability of Employee, then
Employee, or Employee's heirs, executors or administrators if termination is
because of death of Employee, shall be entitled to receive the salary payable to
Employee under Section 3 of this Agreement for one year after the end of the
month in which such termination occurs.
IX. TERMINATION FOR CAUSE
If the Company terminates Employee's employment for Cause, such termination
shall relieve the Company of its obligation to make any further payments under
this Agreement or to honor any unexercised stock options except (a) payments
under employee's benefit plans and programs and (b) payments of amounts which
had accrued but were not yet paid prior to such termination. Termination of
Employee's employment for Cause shall be communicated by delivery by the Company
to the Employee of a written notice of termination together with a copy of a
resolution which has been adopted by the affirmative vote of not less than
three-quarters of the Directors then constituting the Board at a Board meeting
called and held for that purpose, after reasonable notice to Employee and
reasonable opportunity for Employee, together with Employee's counsel, to be
heard by the Board prior to such vote, and which states that in the good faith
opinion of the Board, Employee was guilty of conduct specified in Section 7.1(a)
of this AGREEMENT AND SETS FORTH THE PARTICULARS THEROF. No Termination of
Employee's employment for Cause shall be effective unless the Company complies
with the procedure specified in the preceding sentence.
X. VOLUNTARY TERMINATION
If Employee shall voluntarily terminate his employment for other than Good
Reason, all payments required by this Agreement shall cease, and Employee shall
have no further rights to payments hereunder except (a) payments of amounts
which had accrued but were not paid prior to such voluntary termination and (b)
payment of amounts payable under employee benefit plans and programs. Any
unexercised stock options will also terminate after six (6) months from the date
of voluntary termination.
XI. SURVIVAL
The covenants, agreements, representations and warranties contained in or made
pursuant to this Agreement shall survive Employee's termination of employment,
irrespective of any investigation made by or on behalf of any party.
XII. MODIFICATION
This Agreement sets forth the entire understanding of the parties with respects
to the subject matter, and may be modified only by a written instrument duly
executed by each party.
XIII. NOTICES
Any notice or other communication required or permitted to be given hereunder
shall be in writing and shall be mailed by certified mail, return receipt
requested, or delivered against receipt to the party to whom it is to be given
at the address of such party set forth in the preamble to this Agreement (or to
such other address as the party shall have furnished in writing in accordance
with the provisions of this Section 13). Any notice given to the Company shall
be addressed to the attention of the Corporate Secretary. Notice to the estate
of Employee shall be sufficient if addressed to Employee as provided in this
Section 13. Any notice or communication given by certified mail shall be deemed
given at the time of certification thereof, except for a notice changing a
party's address, which shall be deemed given at the time of receipt thereof.
XIV. WAIVER
Any waiver by either party of a breach of any provision of this Agreement shall
not operate as or be construed to be a waiver of any other breach of that
provision of this Agreement. The failure of a party to insist on strict
adherence to any term of this Agreement on one or more occasions shall not be
considered a waiver or deprive that party of the right thereafter to insist upon
strict adherence to that term or any other term of this Agreement. Any waiver
must be in writing.
XV. BINDING EFFECT
Employee's rights and obligations under this Agreement shall not be transferable
by assignment or otherwise; such rights shall not be subject to commutation,
encumbrance or the claims of Employee's creditors, and any attempts to do any of
the foregoing shall be void. The provisions of this Agreement shall be binding
upon and inure to the benefits of Employee and Employee's heirs and personal
representatives, and shall be binding upon and insure to the benefit of the
Company, its successors and assigns.
XVI. NO THIRD-PARTY BENEFICIARIES
This Agreement does not create, and shall not be construed as creating, any
rights enforceable by any person not a party to this Agreement, except as
provided herein.
XVII. HEADINGS
The headings of this Agreement are solely for the convenience of reference and
shall be given no effect in the construction or interpretation of this
Agreement.
XVIII. COUNTERPARTS; GOVERNING LAW
This Agreement may be executed in any number of counterparts, each of which
shall be deemed as original, but all of which shall constitute one and the same
instrument. It shall be governed by and construed in accordance with laws of the
State of Colorado, without giving effect to the conflict of laws.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date
first above written.
Trend Mining Company
By: /s/ X.X. Xxxxxxxx
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Name: X.X. Xxxxxxxx
Title: Director
EMPLOYEE:
/s/ Xxxxxx X. Xxxxxx
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Employee: Xxxxxx X. Xxxxxx
Schedule of Fringe Benefits
1. Health insurance for Employee and Employee's spouse (or
reimbursement thereof);
2. Disability insurance for Employee;
3. XXXX XXX Plan or alternative
4. D&O insurance
(Note, prior to this Agreement, the Company reimburses Employee for health
insurance but no other benefits are provided.)
