TRANSITION AGREEMENT THIS AGREEMENT made effective the 15 day of January, 2010.
EXHIBIT 10.1
THIS
AGREEMENT made effective the 15 day of January,
2010.
BETWEEN:
OILSANDS QUEST INC., a
corporation incorporated under the laws of Canada. (hereinafter referred to
as the "Corporation")
- and
-
XXXXXXXXXXX X. XXXXXXX, an
individual residing in the Province of Alberta (hereinafter referred to as the
"Executive")
WHEREAS
the Corporation and the Executive have entered into an Executive Employment
Agreement dated effective as of the 14th day
of August, 2006 (hereinafter referred to as the "Executive Employment
Agreement") attached hereto as Schedule "A";
AND
WHEREAS the Corporation plans to sell the Corporation's oil shale assets for the
benefit of its shareholders to a separate company, said new company to be
hereinafter referred to as "New
Co."
AND
WHEREAS the Executive and the Corporation wish to facilitate the transition of
the Executive to a new position with New Co. and set out the terms for the
cessation of the Executive's employment as the President and CEO of the
Corporation;
NOW
THEREFORE in consideration of the mutual covenants and agreements hereinafter
stipulated, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as
follows:
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1.
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PREAMBLES
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1.1
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The
Preambles hereof are true.
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2.
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EFFECTIVE
DATE
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2.1
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This
Transition Agreement will become effective and enforceable upon
execution. Such date will hereinafter be referred to as the
"Effective
Date".
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3.
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BOARD
APPOINTMENT
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3.1
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Subject
to termination for cause, and subject to any vote of the shareholders of
the Corporation, the Executive shall remain a member of the board of
directors of the Corporation and of Oilsands Quest Sask Inc. for at least
his current term.
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4.
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TERMINATION OF THE
EXECUTIVE EMPLOYMENT
AGREEMENT
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4.1
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Except
as set out herein, effective on the Effective Date, all rights and
entitlements of each of the Executive and the Corporation as set out in
the Executive Employment Agreement shall be extinguished. The
Executive shall resign as the Chief Executive Officer of the Corporation
and execute the Release attached hereto as Schedule "B". In
addition to the exceptions set out herein, the Release shall specifically
except out the Executive's right to enforce this Transition Agreement,
along with any ongoing rights that the Executive shall have which are
related in any way to the Corporation's obligation to indemnify the
Executive (including the Indemnity Agreement made effective as of January
1, 2007), along with the Executive's right to have continuing insurance
coverage from the Corporation (which shall specifically include, but not
be limited to, any Direcotr's and Officer's Liability Insurance in place
as of the Effective Date or as may be extended from time to
time.
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5.
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TERMINATION
PAYMENT
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5.1
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On
the Effective Date, the Corporation shall pay the Executive the
termination payments stipulated in Articles 9.1 and 9.2 of the Executive
Employment Agreement.
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6.
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EXCHANGABLE SHARES /
STOCK OPTIONS IN THE
CORPORATION
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6.1
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Notwithstanding
the provisions of Article 12 of the Executive Employment Agreement any
stock options in the Corporation and/or any exchangeable shares held by
the Executive shall continue to vest and shall be exercisable by the
Executive so long as the Executive remains a member of the Board of
Directors of the Corporation as if the Executive had not terminated his
employment. In the event that the Executive resigns or
otherwise ceases to become a member of the Board of Directors of the
Corporation, any exchangeable shares and/or stock options in the
Corporation held by the Executive shall be addressed pursuant to the terms
and provisions of the Executive Employment Agreement as if the Executive
had been terminated without cause as at the date he ceases to become a
member of the Board of Directors of the
Corporation.
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7.
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NON-COMPETITION /
NON-SOLICITATION
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7.1
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Notwithstanding
the termination of the Executive Employment Agreement, the provisions of
Article 13 of that agreement shall continue to pertain to and bind the
Executive.
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7.2
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Notwithstanding
the non-competition and non-solicitation provisions incorporated herein,
any employees recruited by the Executive to work in New Co. with the
advance consent of the Corporation shall be deemed not to offend
non-competition and non-solicitation provisions
hereof. Likewise, any activities of New Co. specifically
permitted by the Corporation shall be deemed not to offend the
non-competition provisions hereof.
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8.
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RELATIONSHIP BETWEEN
THE CORPORATION AND NEW CO.
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8.1
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It
is anticipated that the Corporation and New Co. will enter into a
Transition Agreement whereby the sale, transfer and disposition of the
Corporation's oil shale assets shall be undertaken,
from the Corporation to New Co. It is also anticipated that the
Executive will be appointed as the President and CEO of New Co. at that
time. It is further anticipated that the Transition Agreement
will generally define areas of mutual interest and other parameters of
corporate cooperation including staff transfers, leasehold property
transfers, cost sharing and assignment of leasehold premises
etc.
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8.2
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In
the event that the Corporation, New Co. and the Executive do not come to
agreement in connection with transition arrangements, the other terms and
conditions hereof shall nonetheless remain wholly and enforceable between
the Executive and the Corporation except that the duration of the
non-competition and non-solicitation provisions set out in Article 7.1
hereof shall revert to four months from the termination
date.
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9.
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ANNOUNCEMENTS
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9.1
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The
Executive and the Corporation shall use reasonable good faith efforts to
work together to prepare appropriate announcements to reflect positively
on the Executive's transition from the Corporation to New Co., and for the
purpose of creating and maximizing shareholder value in each of the
Corporation and New Co.
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10.
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MODIFICATIONS IN
WRITING
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10.1
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This
Agreement may only be modified in writing by the signature of each of the
parties hereto.
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IN
WITNESS WHEREOF the parties hereto acknowledge and agree that they have read and
understand the terms of this Agreement, and that they have each had the
opportunity to seek independent legal advice prior to entering into this
Agreement, and that they have executed this Agreement with full force and effect
from the Effective Date.
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XXXXXXXXXXX
X. XXXXXXX
Executive
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OILSANDS QUEST INC. | ||||
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/s/ Xxxxxxxxxxx X. Xxxxxxx
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Per: | /s/ Xxxxxx Xxxxxxx | |||
| Director | |||||
| /s/ Xxxxx Xxxxxx | |||||
| Witness | |||||
Schedule
"A" to the Transtition Agreement dated January 15, 2010 and made between
Oilsands Quest Inc. ("Corporation") and Xxxxxxxxxxx X. Xxxxxxx
("Executive")
(Exhibit
10.3 to the Corporation's current report on Form 8-K filed with the U.S.
Securities and Exchange Commission on August 17, 2006)
Schedule
"B" to the Transtition Agreement dated January 15, 2010 and made between
Oilsands Quest Inc. ("Corporation") and Xxxxxxxxxxx X. Xxxxxxx
("Executive")
FORM
OF GENERAL RELEASE AND CONFIDENTIALITY AGREEMENT
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RELEASE
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IN CONSIDERATION of the terms
of a Transition Agreement between me and OILSANDS QUEST INC. and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, and but for my right to enforce the Transition Agreement,
and as hereafter excepted in Article 1 below, I, XXXXXXXXXXX X. XXXXXXX, do for
myself and my heirs, executors, administrators and assigns (herein collectively
referred to as "I", "me" or "my"), forever release, remise and discharge OILSANDS
QUEST INC., its subsidiaries, affiliates, parent companies, predecessors
and successors, and all of their officers, directors, employees, agents,
members, insurers and assigns (hereinafter collectively referred to as the
"Corporation"), jointly and severally from any and all actions, causes of
action, contracts (whether express or implied), claims and demands for damages,
loss or injury, suits, debts, sums of money, indemnity, expenses, interest,
costs and claims of any and every kind and nature whatsoever, at law or in
equity, which against the Corporation I have ever had, now have, or can
hereafter have by reason of or arising out of any cause or causes whatsoever
existing up to and inclusive of the date of this General Release, including,
without limiting the generality of the foregoing:
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(a)
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any
discussions, representations, warranties or understandings, either written
or oral, express or implied, regarding any offer of employment made to me
by the Corporation or the negotiation of any terms and conditions of my
employment with the Corporation;
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(b)
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my
employment with the Corporation and the termination of my employment with
the Corporation; and
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(c)
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any
and all claims for damages, salary, wages, termination pay, severance pay,
vacation pay, commissions, bonuses, signing bonus, expenses, allowances,
short and long term incentive compensation, stock options, stock savings,
shares of the Corporation, insurance, Group RRSP and any other
compensation or benefits arising from my employment with the Corporation
or the termination of my employment with the
Corporation.
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1.
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EXCEPTIONS
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Nothing in this Release releases or otherwise
impacts the following:
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(i)
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Any rights which I may have to enforce the above noted Transition
Agreement;
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(ii)
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Any indemnity or insurance rights which I may have as a result of my
service with or the Corporation;
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(iii)
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Any rights, obligations or liabilities which I may have in relation
to or connected with my past or future service as a director of the
Corporation;
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(iv)
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Withouth limiting the generality of the foregoing, any rights which I
may have in any currently held securities or equities in the Corporation
or those I may recieve as reflected in Article 6 of the Transition
Agreement.
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2.
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NO
ADMISSION
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I
acknowledge that the consideration given to me pursuant to the above paragraph
does not constitute any admission of liability by or on behalf of the
Corporation, and that any such liability is expressly denied.
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3.
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INDEMNITY
FOR TAXES, ETC.
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I further
agree that for the aforesaid consideration, I will save harmless and
indemnify the Corporation from and against all claims, taxes, penalties or
demands which may be made by the Minister of National Revenue requiring the
Corporation to pay income tax under the Income Tax Act (Canada) in
respect of all income tax payable by me in excess of the income tax previously
withheld, and in respect of any and all claims, charges, taxes, penalties or
demands which may be made on behalf of or related to the Employment Insurance
Commission or the Canada Pension Commission under the applicable statutes and
regulations, with respect to any amount which may, in the future, be found to be
payable by the Corporation in respect of me.
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4.
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EMPLOYMENT
STANDARDS
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I acknowledge receipt of
all wages, overtime pay, vacation pay, general holiday pay and pay in place of
termination of employment that I am entitled to by virtue of the Alberta Employment Standards Code or
pursuant to any other applicable labour or employment standards legislation, and
I further confirm that there are no entitlements, overtime pay or wages due and
owing to me by the Corporation.
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5.
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BENEFITS
AND INSURANCE CLAIMS
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I
acknowledge and agree that the consideration set out above includes full
compensation for the loss of my employment benefits and that all of my
employment benefits shall cease on the date of termination of my
employment. I acknowledge that I have received all benefit
entitlements, including insurance benefits to date, and have no further claim
against the Corporation for benefits. I fully accept sole
responsibility to replace those benefits that I wish to continue and to exercise
conversion privileges where applicable with respect to my employment benefits,
or the loss of my employment benefits. I hereby release the
Corporation from any further obligations or liabilities arising from my
employment benefits.
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6.
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HUMAN
RIGHTS
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I agree
that execution of this General Release has the effect of settling any claims I
may have and precluding the consideration of any further complaint by me
pursuant to the Alberta Human
Rights, Citizenship and Multiculturalism Act, or pursuant to any other
applicable human rights legislation.
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7.
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CONFIDENTIALITY
AND NON-DISCLOSURE
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I
acknowledge that during my employment with the Corporation, I had access to
certain confidential and proprietary information belonging to the Corporation,
the disclosure of which would be harmful to the interests of the Corporation,
and agree that I have taken and will in future take appropriate precautions to
safeguard such confidential and proprietary information. I further
agree that I will not divulge or disclose, directly or indirectly, the contents
of this General Release or the terms of settlement relating to the termination
of my employment with the Corporation, and that I will not make any negative or
unfavourable comment about the Corporation regarding any matter arising or
existing up to the date of execution of this General Release, to any person
including, without limiting the generality of the foregoing, any employee of the
Corporation, with the exception of my legal and financial advisors on the
condition that they maintain the confidentiality thereof, or as required by
law.
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8.
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FURTHER
CLAIMS
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I agree
not to make any claim or take any proceedings against any other person or
corporation that might claim contribution or indemnity under the provisions of
any statute or otherwise against the Corporation.
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9.
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UNDERSTANDING
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AND I HEREBY DECLARE that I
have had the opportunity to seek independent legal advice with respect to the
matters addressed in this General Release and the terms of settlement which have
been agreed to by me and the Corporation and that I fully understand this
General Release and the terms of settlement. I have not been
influenced by any representations or statements made by or on behalf of the
Corporation. I hereby voluntarily accept the said terms for the
purpose of making full and final compromise, adjustment and settlement of all
claims as aforesaid.
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10.
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COMPLETE
AGREEMENT
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I
understand and agree that this General Release contains the entire agreement
between the Corporation and myself and that the terms of this General Release
are contractual and not a mere recital.
DATED at the City of Calgary, in the
Province of Alberta, this 15TH day
of January, 2010.
| /s/ Xxxxx X. Xxxxxx | /s/ Xxxxxxxxxxx X. Xxxxxxx | ||||
| Witness (signature) | Xxxxxxxxxxx X. Xxxxxxx | ||||
| Xxxxx X. Xxxxxx | |||||
| Witness (print name) |
