EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is entered into as of this 20th day of November 2006 by and between Ignis Petroleum Corporation and Ignis Petroleum Group, Inc., (collectively referred to as "Company") and Xxxxx X. Xxxxx (hereinafter referred to as "Employee").
FOR GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of which is hereby acknowledged by the parties hereto, the Company and Employee agree, as follows:
1. Employment. Company hereby employs Employee and Employee accepts employment by Company, subject to the terms and conditions set forth in this Agreement and subject to Company's policies and procedures, to the extent the Company's policies and procedures are not inconsistent with this Agreement, for the Employment Period (as defined below) stated herein.
2. Position. During the Employment Period, Employee will render services as Chief Financial Officer with responsibility for finance, treasury, accounting, and information system. Employee shall report directly to the President and CEO of Company and serve on the Senior Management Team. A summary of the position and areas of responsibility is attached hereto as Exhibit A.
3. Employment Period or Term. Company hereby agrees to employ Employee, and Employee hereby agrees to be employed by Company for a period of three years commencing on November 20, 2006 and ending on November 20, 2009 (the "Employment Period" or "Term"). The parties by mutual written agreement may renew this Agreement.
4. Duties. Employee's duties are more particularly described in Exhibit A. In addition, Employee shall attend management and staff meetings with executive and supervisory personnel of Company, as required. Employee shall also perform such other duties reasonably requested by Company.
5. Compensation. Employee shall be provided with a base remuneration of cash, restricted common stock, bonus and non-bonus, and benefits as detailed in Exhibit B.
6. Termination of Employment. This Agreement and Employee's employment may be terminated at any time as follows:
(a) Resignation by Employee. In the event Employee resigns from Company, the Company shall not be obligated to provide a severance package other than those benefits provided as a matter of law. In the event Employee resigns from Company due to breach of this Agreement by Company and employee has given the Company written notice and a reasonable opportunity to cure such breach, Employee shall be entitled to the severance package described in paragraph 6(c) provided that Employee is not herself in breach of this Agreement or otherwise eligible to be terminated under section 6(b) of this Agreement;
(b) By the Company upon notice for Cause which shall be defined as:
(i) Employee's willful failure, neglect, refusal, or nonperformance, at any time, of Employee's duties or obligations set forth in this Agreement or a willful breach by Employee of this Agreement;
(ii) Employee's conviction or no contest or guilty plea to or indictment for (or its procedural equivalent) a felony or crime involving moral turpitude, or Employee's guilty plea or no contest plea to a lesser included offense or crime in exchange for withdrawal of a felony indictment, felony charge by information, or a charged crime involving moral turpitude, whether the charge arises under federal, state or local law;
(iii) Employee's death or disability;
(iv) Employee's failure to adhere in any material respect to any material written policy of the Company;
(v) Employee's appropriation (or attempted appropriation) of a material business opportunity of the Company or any of its affiliates, including, without limitation, attempting to secure or securing, any personal profit in connection with any transaction entered into on behalf of the Company or any of its affiliates;
(vi) Employee's commission of an act of fraud, illegality, theft or willful misconduct toward the Company or any of its affiliates in the course of employment with the Company that relates to the Company's or any of its affiliates' assets, activities, operations or other employees;
(vii) Employee's repeated intoxication with alcohol or drugs while on the Company's premises during regular business hours; or
(viii) Employee's gross incompetence that has a material adverse impact on the Company's finances or operations or a pattern of gross incompetence of Employee, in each case as determined in good faith by the Board of Managers of the Company;
In the event Employee is terminated for Cause the Company shall pay Employee's salary
and benefits through the date of such termination and Employee shall forfeit and have no right to any shares of stock compensation (bonus and non-bonus) otherwise scheduled to vest and be issued to Employee after the date Employee is terminated for Cause.
(c) Company may terminate Employee's employment without Cause. The term "without Cause" shall be defines as any reason except those set out in subparagraph (b) of Section 6. In that event, Company shall provide Employee with a severance package. Employee's severance package shall include for a period of three months (or for one year if said termination without cause occurs within one year of a change-of-control of the Company (i) payment of Employee's salary; (ii) benefits grossed up for tax purposes; and (iii) the remaining (non-bonus) shares of Company stock compensation.
7. Confidential or Proprietary Information. During and after the Employment Period, Employee will not, without the prior written consent of Company, either directly or indirectly transmit or disclose to any person or entity any Confidential or Proprietary Information of Company and its affiliates which Employee hereby acknowledges he will obtain in the course of his employment hereunder. Employee will not disclose such Confidential or Proprietary Information for his own benefit or the benefit of any other person or entity. As used in this Agreement "Confidential or Proprietary Information" means any information not generally disclosed or known to the trade or public concerning business or operation of the Company. Employee agrees to maintain all such information in confidence during Employee's employment with Company and following any termination of this Agreement or Employee's employment. Employee shall properly return to a representative of Company all materials involving Confidential or Proprietary Information in the Employee's possession or control. The prior knowledge, mental impressions, and experiences of Employee gained before employment with Company shall not be deemed Company's Confidential or Proprietary Information.
8. Indemnification and Insurance. Company and Employee shall enter into an Indemnification Agreement in the form attached hereto as Exhibit C.
9. Dispute Resolution. The parties agree that any dispute, controversy or claim, whether based on contract, tort, statute, discrimination, retaliation, or otherwise, relating to, arising from or connected in any manner to this Agreement, or to the alleged breach of this Agreement, or arising out of or relating to Employee's employment or termination of employment, shall, upon timely written request of either party be submitted to and resolved by binding arbitration. The arbitration shall be conducted in Dallas, Texas. The arbitration shall proceed in accordance with the National Rules for Resolution of Employment Disputes of the American Arbitration Association ("AAA") in effect at the time the claim or dispute arose, unless other rules are agreed upon by the parties. Unless otherwise agreed to by the parties in writing, the arbitration shall be conducted by one arbitrator who is a member of the AAA. Any claims received after the applicable/relevant statute of limitations period has passed shall be deemed null and void. The award of the arbitrator shall be a reasoned award with findings of fact and conclusions of law. Either party may bring an action in any court of competent jurisdiction to compel arbitration under this Agreement, and to enforce an arbitration award. Each party shall pay 50% of the actual costs of arbitration excluding attorney's fees. Each party will pay its own attorney's fees and other costs incurred by their respective attorneys.
10. Miscellaneous.
(a) Choice of Law: Unless otherwise specified or required by statute in a particular jurisdiction which expressly pertains to an employment relationship (e.g., wage payment timing, tax withholding, etc.), all construction and interpretation of this Agreement shall be governed by and construed in accordance with the laws of the State of Texas, without giving effect to principles of conflicts of law.
(b) Severability: Employee and Company agree that any provision of this Agreement deemed void, voidable, illegal, unenforceable or invalid may be reformed to permit enforcement of the objectionable provision to the fullest permissible extent. Any provision of this Agreement deemed unenforceable after modification shall be deemed stricken from this Agreement, with the remainder of the Agreement being given its full force and effect.
(c) Waiver: No waiver by Employee or Company of any default or breach of any covenant of this Agreement shall be deemed to be a waiver of any prior or subsequent default or breach of the same or other covenant of this Agreement, or affect in any way any rights arising by virtue of any prior or subsequent occurrence.
(d) Merger: This Agreement contains the entire understanding of the parties with respect to the subject matter hereof and supersedes and nullifies all prior or contemporaneous conversations, negotiations, or agreements (oral or written) regarding the subject matter of this Agreement. In any future construction of this Agreement, this Agreement should be given its plain meaning. This Agreement and any attached exhibits may not be changed, modified or amended in any respect except by a written instrument. To the extent the wording of this Agreement conflicts with any provision of Exhibits A & B, the wording of this Agreement shall control.
(e) Counterparts: This Agreement may be executed in counterparts, a counterpart transmitted via facsimile, and all executed counterparts, when taken together, shall constitute sufficient proof of the parties' entry into this Agreement. The parties agree to execute any further or future documents which may be necessary to allow the full performance of this Agreement.
(f) Headings: This Agreement contains headings for ease of reference. The headings have no independent meaning.
IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement to be effective as of the date first written above.
Employee: /s/ Xxxxx X. Xxxxx
Xxxxx X. Xxxxx
Date: 12/20/2006
Company: Ignis Petroleum Corporation
By: /s/ Xxxxxxx X. Xxxxxx
Its: President & CEO
Date: 12/28/06
Company: Ignis Petroleum Group, Inc.
By: /s/ Xxxxxxx X. Xxxxxx
Its: President & CEO
Date: 12/28/06
EXHIBIT A
CHIEF FINANCIAL OFFICER-DESCRIPTION
POSITION SUMMARY
- Company Officer directly accountable for accounting, finance and treasury, information systems, financial planning and analysis, and compliance with SEC reporting and other regulatory requirements.
- Key member of the senior management team who shall provide input on matters of strategic and tactical importance and serve as lead officer on securing financing.
- Expected to be knowledgeable and skilled in matters related to the oil and gas accounting, finance, information, and compliance.
PRIMARY AREAS OF RESPONSIBILITY
- Build the institutional capabilities commensurate with functional areas of responsibility.
- Direct and oversee all aspects of the company's accounting, treasury, finance, financial planning and analysis (including budget), and information systems.
- Maintain existing and establish new relationships with external accountants and auditors to ensure appropriate controls, and with banks and financial partners to create potentially new financing sources.
- Contribute to asset acquisitions including economic evaluation, structuring and negotiating deals, due diligence, and acquisition of financial resources.
- Track financial performance results versus plan/budget and identify, with other senior team members, areas requiring correction and cost-saving opportunities.
- Provide monthly financial updates to senior management team and to financial partners; assist CEO in preparing materials for Board of Directors meetings.
- Maintain and create company's participation in key business financial groups and forums to provide industry representations.
PROFESSIONAL REQUIREMENTS
- BS degree in Accounting
- Significant experience in accounting and financial functions within an oil and gas environment with demonstrated progressive leadership positions
EXHIBIT B
REMUNERATION AND BENEFITS
CASH COMPENSATION:
- $150,000 per year (adjusted annually based on individual and Company performance)
STOCK COMPENSATION: Total award of up to 1,800,000 common shares of restricted stock over three years, granted in increments of 170,000 shares every six months (340,000 per year) and 260,000 in bonus shares each year. The bonus element will be based on both company and individual performance and will be subject to approval by the board's compensation committee.
PAID TIME OFF: Up to four weeks earned vacation per year and ten business holidays.
MEDICAL INSURANCE: Company to pay for employee coverage per the Company plan ("contribution") or to reimburse an amount up to the contribution for employee self-elected plan.
REIMBURSABLE EXPENSES: Reimbursed for reasonable and customary expenses incurred on behalf of an in furtherance of the business of the Company. Upon approval of such expenses Company shall promptly (within 30 days) provide reimbursement for such expenses.
CHANGE OF CONTROL: The Company would provide for cash severance equal to one-year of salary and advance of remaining restricted share balance upon change of control.
PERFORMANCE: The Company will conduct a formal performance at the end of each year of employment. The Company can decide to terminate this relationship should performance not meet expectations. In such case the Company would provide a severance of three months cash salary and provide the remaining (non-bonus) shares of Ignis stock compensation without any further obligation to the Company.
L:\Southlake\Clients\Ignis Petroleum\2007 SEC Matters (98848)\8-K\Exhibit 10.1 Xxxxx Employment Agmt-v1-MPP(11-20-06).doc
