EMPLOYMENT AGREEMENT
EXHIBIT 10.7
EMPLOYMENT
AGREEMENT (this "Agreement") made as of
December 1, 2009, between Xxxxxxxx XxXxxx residing in Bedminster, NJ
(hereinafter called the "Employee")
and Xtreme Oil & Gas, Inc., a Washington corporation incorporated under the
laws of Washington and having an address in Plano, Texas (hereinafter called the
"Company").
WHEREAS,
the Company desires to retain the services of Employee, and Employee desires to
be engaged by the Company, pursuant to the terms and conditions
hereof;
NOW,
THEREFORE, for good and valuable consideration and in further consideration of
the mutual covenants and agreements contained herein, the parties hereto hereby
covenant and agree as follows:
1. Engagement. Company
hereby employs Employee in the position of Chief Operating Officer and shall
report directly to the Chief Executive Officer, Employee accepts this employment
with the Company subject to the terms and conditions set forth in this
Agreement. Employee agrees to perform such duties and
responsibilities as set forth in Exhibit A attached hereto, and as may
reasonably be determined by the President the Company from time to time and will
report to and be under the direct supervision and control of the
President. Employee agrees to perform his duties diligently and to
use his best abilities to promote and further the business of the
Company. Employee shall at all times act in compliance with all
Company Policies, procedures, rules and regulations in effect from time to time,
set forth in the Employee Handbook and any applicable laws, rules or
governmental regulations, domestic or foreign. Employee shall
maintain regular work\office hours in accordance with Company Policy or as
determined by the President. Employee shall devote such portion of
his time to the business and affairs of the Company, sufficient to handle its
business and activities properly. The employee shall not be required
to work full time for the Company and may devote a portion of his time and
efforts to a third party business provided that such businesses does not compete
with the Company in any manner.
2. Compensation.
2.1 Salary. The
Company shall pay to Employee an annual base salary of $180,000.00 ("Basic
Compensation") during the Initial Term of this Agreement, payable on a
current basis. The Basic Compensation shall be paid in accordance
with the Company's regular payroll practices in effect from time to time,
subject to withholding as required by law, including, without limitation, social
security and federal, state and local taxes. The Basic Compensation
constitutes compensation for all regular hours worked, plus any work performed
outside of regular business hours, including weekends or
holidays. After the Initial Term, the Basic Compensation shall
continue during the Renewal Term(s), if any, unless the President shall in
writing change the Basic Compensation, at his sole discretion.
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2.2 Benefits. The
Company may provide and make available to Employee other benefits of employment
such as bonus compensation, profit-sharing, retirement, disability, group
life, medical or dental insurance or other employee benefit plan(s),
if any, that are approved by the Managers at their sole discretion from time to
time for employees of the Company. Participation in any bonus,
profit-sharing or other plan measured by the income or performance of Employee
shall be consistent with Employee's rate of Basic Compensation to the extent
compensation is a determinant with respect to coverage or participation in any
such plan. The Company does not guarantee or make any warranty
regarding the insurability of Employee.
2.3 Stock Options. The
Company grants Employee options to purchase 2,000,000 shares of Common Stock of
Xtreme Oil and Gas. All grants of the Company common stock and/or Company stock
options including the grant made in Section 2.3 of this Agreement, shall vest
monthly over a two year period and have an expiration period of ten (10) years
from the time of said grant(s) with automatic full vesting in the event of a
Change of Control defined in Section 4.5 of this Agreement.
2.4 Paid
Leave.
2.4.1 Vacation or Rest
Leave. During the Term, the Employee shall be entitled
to paid vacation time totaling four (4) weeks paid vacation time per calendar
year pursuant to the Company policies set forth in the Employee Handbook;
however, Employee shall provide the Company with reasonable advance notice when
he intends to use vacation time.
2.4.2 Illness or Personal Time,
Disability. Employee shall be entitled to a total of ten (10) days of paid time off for
illness or personal reasons per calendar year. Paid personal time
shall not increase the Basic Compensation or constitute Bonus Compensation or
otherwise entitle Employee to any monetary or other type of
payment. Employee will not receive compensation of any type for paid
personal time not used in a calendar year.
In the
event the Employee becomes medically disabled, in the reasonable opinion of the
Managers, the Company shall continue basic compensation for up to six months
beginning from the first day of disability as a disability benefit to the
employee affected. If, at the end of the six month period the
disabled employee is not able to return to work, the Company shall continue
basic compensation for an additional twelve months as termination
pay.
3. Initial Term and
Renewal. The initial term of this Agreement (“Initial
Term”) shall be five (5) years from the date hereof. After the
Initial Term, this Agreement shall renew automatically for consecutive six month
terms, otherwise on the same terms and conditions; except, after the Initial
Term, either Company or Employee may terminate this Agreement without Cause by
providing to the other party two weeks’ written notice of termination
at any time. The Initial Term and any Renewal Terms may be
collectively referred to in this Agreement as “Term”.
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4. Termination.
4.1 Termination by Company for
Cause. The Company shall have the right to terminate
Employee's employment under this Agreement at any time, during the Initial term
or any Renewed Term, for Cause (as defined in Section 4.2). Upon the
termination of this Agreement, Employee shall have no authority whatsoever to
incur any obligation or to make any agreement, representation, or warranty on
behalf of or for the account of the Company, or to undertake any activity on
behalf of Company. The Company shall pay Employee his Basic
Compensation through the date of termination.
4.2 Cause Defined. "Cause" shall mean any one or more of the following, each determined by the President, in his sole discretion: (i) Employee's willful negligence or continuing negligence in the performance of his duties with the Company; or (ii) Employee's willfully continuing failure to perform his duties in accordance with this Agreement, or failure to comply with the policies of the Company set forth in the Employee Handbook; or (iii) embezzlement or attempted embezzlement from Company, its successors, assigns, affiliates or clients; or (iv) insubordination of the Employee; or (v) dishonesty with respect to the Company, its operation or finances or its successors, assigns, affiliates and clients; or (vi) commission of a felony violation under federal or state law; or (vii) commission of any act involving willful or intentional injury to the Company, its business or its reputation. The provision of Section 6 & 7 shall continue to bind Employee if this Agreement is terminated for Cause.
4.3 Termination by Mutual
Consent or by Employee. This Agreement may be terminated at
any time without Cause by the mutual written consent of Company and the
Employee, or unilaterally by Employee upon fourteen (14) days’
notice. However, the provisions of Sections 6 and 7 shall continue to
bind Employee for the periods stated therein.
4.4 Surrender of Company
Property. Immediately upon termination of this Agreement for
any reason, Employee shall return to Company all property in his possession that
belongs to Company, including without limitation, Confidential Information, all
of which belong to the Company. Employee agrees that because of the
economic damage resulting from a breach by Employee of this provision and the
immediate and irreparable harm caused to Company, the obligations of Employee
under this Section 4.4 may be enforced by the procedures of Section 7.2 for
temporary restraining orders and injunctive relief, and shall survive
termination of this Agreement for any reason.
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4.5 Termination
Pay. In the event the Employee is terminated without Cause or
the Employee leaves for Good Reason defined as (A) the assignment, without the
Employee's
written consent, to the Employee of duties that are significantly different
from, and that result in a substantial diminution of, the duties that he assumed
on the Effective Date; (B) the assignment, without the Employee's consent, to
the Employee of a title that is different from and subordinate to the title
specified in Section 2 above; (C) material breach by the Company of this
Agreement, or (D) a Change in Control. "Change of Control" shall mean
(i) any transaction or series of transactions in which any person or group
(within the meaning of Rule 13d-5 under the Exchange Act and Sections 13(d) and
14(d) of the Exchange Act) becomes the direct or indirect "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), by way of a stock issuance,
tender offer, merger, consolidation, other business combination or otherwise, of
greater than 50%
of the total voting power (on a fully diluted basis as if all convertible
securities had been converted and all warrants and options had been exercised)
entitled to vote in the election of directors of the Company (including any
transaction in which the Company becomes a wholly owned or majority-owned
subsidiary of another corporation), (ii) any merger or consolidation or
reorganization in which the Company does not survive, (iii) any merger or
consolidation in which the Company survives, but the shares of the Company's
common stock outstanding immediately prior to such merger or consolidation
represent 50% or less of the voting power of the Company after such merger or
consolidation, and (iv) any transaction in which more than 50% of the Company's
assets are sold; then the Company shall pay the Employee a termination payment
equal to the remaining balance due for the unexpired term of this Agreement, but
in no event less than twelve (12) months of the Employee’s then effective
salary.
In the
event the Employee dies while employed by the Company, an amount equal to one
years salary shall be paid within 30 days to his estate as termination pay plus
any previous compensation accrued or not yet paid.
5. Business
Expenses. The Employee shall be reimbursed for all reasonable
travel and other expenses incurred by him in connection with performing his
duties under this Agreement. Only expenses which conform with
Company policies applicable thereto that may be adopted from time to time, if
any, shall be reimbursed. For all such expenses the Employee shall
furnish to the Company detailed statements, receipts and vouchers to verify such
expenses, and shall comply with all procedures adopted by the Company from time
to time for the payment and processing of business expenses.
6. Confidential
Information. Immediately upon commencement of this Agreement
and continuing during the Term, Employee will receive special training
involving, and will use and have access to, confidential and proprietary
information and trade secrets in written, oral or intangible form (computer
generated or stored or otherwise) concerning the Company's business, finances,
operations, research and development not generally available to or known to the
public that may include without limitation the following: corporate records and
minutes of officer, director or shareholder meetings or consent actions;
financial statements and information (including accounts payable and
receivables and short and long term debt facilities and journal entries);
marketing research, plans, sales
reports and sales information; tax information, returns and reports; customer
lists, records and data; supplier and vendor information; lists or sources of
potential customers; pricing lists, structure and data, including discount
information; production cost information; business plans and development
strategy; standard forms and documents developed by Company; software
(including engineering and technical software), formulas, patterns, designs,
concepts, drawings, specifications, methods or plans relating to the business
and operations of Company and all technology, intellectual property (whether
protected by patent or copyright or not), data , information, or software, in
any form whatsoever (all of which collectively defined herein as “Confidential
Information”). Confidential Information shall also include all
information generated by the Employee, which is derived from, contains,
reflects, or incorporates the information provided as Confidential
Information.
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Employee acknowledges and agrees that
all Confidential Information is confidential and a valuable, special and unique
asset of Company that gives Company an advantage over its actual and potential,
current and future competitors. Employee acknowledges and agrees
that, as part of his duties under this Agreement, Employee owes Company a duty
to preserve and protect all Confidential Information from unauthorized
disclosure or use. The Employee recognizes that disclosure of the
Confidential Information to competitors, non-authorized third parties or the
general public, or use of the Confidential Information by Employee for his own
benefit, would be
detrimental and cause irreparable harm to the Company.
Accordingly,
the Employee covenants and agrees that during the Term of this Agreement and for
five (5) years after termination (for any reason) of this Agreement, he will
keep secret and treat confidentially the Confidential Information, and he will
not disclose any of the Confidential Information to any person or entity outside
of the Company nor shall he use the Confidential Information for any purpose
other than the purposes of the Company. Employee will not copy,
reproduce, decompile, or reverse engineer, any Confidential Information, or
remove or transmit by email or other electronic means Confidential Information
from the premises of Company absent specific consent. The Employee
agrees that all restrictions contained in this clause are reasonable and valid
in the circumstances and all defenses to the strict enforcement thereof by the
Company are hereby waived by the Employee.
7. Non-Competition
Agreement.
7.1 Restrictions. During
the term of this Agreement and for one (1) year from the
termination of this Agreement, Employee agrees that he will not, directly or
indirectly, as an employee, a consultant or an independent contractor, or as
partner, officer, director, manager, member or owner of any interest in or
security of, any partnership, corporation, limited liability company or other
business entity, venture or enterprise, do any of the following:
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(a)
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endeavor
to compete with the Company’s intellectual property, particularly the
Adventures of the Elements, by promoting, creating or endeavoring to sell
animated or drawn charters similar to those used by the Company;
or
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(b)
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induce
or solicit an employee of the Company to terminate their employment with
the Company; or
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(c)
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acting
alone or in conjunction with others, solicit the sale of goods or services
similar to those of Company from any customer of Employer with whom
Employee has had contact with in the course of his
employment.
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7.2 Remedies. Employee
acknowledges that the provisions of Section 6 and Section 7 are necessary for
the protection of Company. Company and its affiliates would be
irreparably damaged in the event any of the restrictions contained in Section 6
or 7 were not performed in accordance with their specific terms or were to be
otherwise breached. Therefore, Company shall be entitled to temporary
restraining orders and temporary and permanent injunction or injunctions to
specifically enforce the restrictions in Sections 6 and 7 in any court, without
the necessity of proving actual damages or posting a bond of any type or size,
in addition to any other remedy to which Company may be entitled, at law or in
equity, all of which shall be cumulative and not exclusive. No
failure or delay by the Company in exercising any right, power, or privilege
hereunder shall operate as a waiver of such right, power or privilege, nor shall
any whole or partial exercise of any such right, power, or privilege preclude
any other or further exercise thereof.
Employee
agrees that the provisions in this Section 7 are ancillary to the other
provisions of this Agreement; and designed to enforce Employee’s confidentiality
obligations.
7.3 Modification by
Court. The parties hereto agree that in the event that either
the length of time or the geographical area or any other provision set forth in
Section 7 is deemed too restrictive in any court proceeding, the court may
reduce such restrictions to the extent the court deems reasonable under the
circumstances.
8. Intellectual Property, Discoveries and
Inventions. “Work
Product” is defined as all compositions of matter, designs,
data, discoveries, developments, enhancements of any intellectual property of
Company, formulae, inventions (regardless of whether patented or subject to
copyrighter patent protection), improvements of any intellectual property of
Company, ideas (regardless of whether protected or subject to protection under
trade secret laws) know-how, storylines, characters, plots, animated figures,
programs, processes, software, techniques, technical developments, trademarks,
trade names, works of authorship (regardless of whether protected or subject to
protection of copyright law) and all other work product, whether tangible or
intangible, written or computer or other electronic stored.
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Employee
assigns, transfers, conveys and agrees to assign, transfer, convey to Company
all his right, title, and interest in and to any and all Work Product and any
related or associated intellectual property which Employee conceives, creates,
develops, generates, produces, reduces to practice, reduces to writing, creates
in software form, or other storage media either alone or jointly with others
deciding the Term of this Agreement, without royalty or compensation (Employer
Compensation under Section 2 is full consideration of any Work
Product). The Work Product does not have to be subject to or eligible
for federal or state patent, copyright or trademark protection to be subject to
this provision.
If any
such Work Product is created wholly or in part by the Employee during his hours
of actual work for the Company, or with the aid of the Company's materials,
equipment, or personnel, or at the premises of Company, or resulted from or in
any way were derived or generated by performance of Employees duties under this
Agreement, then such creation shall be deemed conclusively to have occurred in
the course of his employment. It is recognized that the Employee will
perform the duties assigned to him at times other than his actual working hours
and the Employee's rights hereunder shall not be diminished because the Work
Product was created at such other time.
The
Employee agrees to perform all acts necessary or reasonably requested by Company
to enable the Company to learn of, understand, protect, obtain and enforce
patent or copyright rights to the Work Product, including but not limited to,
making full and immediate disclosure and description to Company of the Work
Product, and assisting in preparation and execution of documents required to
transfer and convey the Work Product and to convey to Company patent and
copyright protection in the United States and any foreign
jurisdiction. In the event Company in unable to secure the signature
of Employee to any document required to file, prosecute, register or memorialize
the assignment of any patent copyright mask work, Employee irrevocably appoints
the President of Company as Employee’s agent and attorney in fact to act for and
on behalf of and instead of Employee to take such actions needed to enforce and
obtain Company’s rights hereunder. To the extent any of Employee’s rights, title
or interest to the Work Product cannot be assigned to Company, Employee grants
and will grant an exclusive, world wide, transferable, irrevocable, royalty free
license (with rights to sublicense without consent of Employee) to
Company. These obligations shall continue beyond the termination of
this Agreement and shall be binding upon Executive’s assigns, executors,
administrators and other legal representatives.
9. Validity of
Covenants. If any covenant or provision herein is determined
to be void or unenforceable in whole or in part, it shall be
reformed, or if reformation is not possible, deleted from the remaining
Agreement and shall not affect or impair the validity of any other covenant or
provision of this Agreement. The Employee hereby agrees that all
restrictions in this Agreement are reasonable and valid and all defenses to
the strict enforcement thereof by the Company are hereby waived by
him.
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10. Notice. All communications
required or permitted to be made under this Agreement ("Notices") shall be in
writing and shall be made in any of the following methods: i) personal delivery
by messenger or courier, receipt acknowledged and dated, or ii)
deposited in the U.S. mails using certified or registered mail with postage
prepaid and properly addressed, or iii) by facsimile or electronic
(email) transmission, receipt confirmed in writing, or iv) federal express or
other overnight courier. Notices shall be sent, delivered or
transmitted, as appropriate, to the addresses or fax numbers that appear on the
signature line.
Any party
may change the addresses, telephone, email or telefax number by serving Notice
on all other parties. All such notices shall be deemed effective i)
if mailed, the earlier of two days from deposit in the U.S. mails or actual
receipt, ii) if personal or Federal Express delivery, upon delivery, iii) if
facsimile or electronic (email), upon confirmation of receipt.
11. Waiver. A waiver by
any party of any breach of this Agreement shall not constitute a waiver of
future reoccurrences of such breach, or other breaches. A waiver by
any party of any terms, conditions, rights or obligations under this Agreement
shall not constitute a waiver of such term, condition, rights or obligation in
the future. No delay or omission by party to exercise any right,
power or remedy shall impair or waive any such right, power or remedy, or be
construed as a waiver of any default. No whole or partial
exercise of any right, power, or privilege shall preclude any other or further
exercise thereof
12. GOVERNING LAW. THE
PROVISIONS OF THIS AGREEMENT SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF TEXAS, U.S.A., AND VENUE FOR ALL PURPOSES SHALL BE
IN COLLIN COUNTY, TEXAS.
13. Assignment. The
Company may assign this Agreement to a successor business or entity, including
by merger, consolidation or other business reorganization or to an affiliate, or
upon change of ownership or sale of substantially all its assets. The
Employee may not assign this Agreement or any of his duties or responsibilities
hereunder.
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14. Entire Agreement; Amendment;
Headings. This Agreement constitutes the entire understanding
between the parties with reference to the subject matter hereof and shall not be
changed or modified except by written instrument signed by each
party. The headings used in this Agreement are solely for convenience
and are not to be used in construing or interpreting this
Agreement.
15. Indemnification. The
Company shall indemnify the Employee and hold him harmless as set forth in
Section 6.3 of the Company Agreement.
16. Survival of
Covenants. The parties expressly agree the Confidentiality
provisions of Section 6 and the Non-Competition provisions of Section 7 shall
survive the termination of this Agreement regardless of the reason, and shall
continue to bind Employee as stated therein.
DATED: December
1, 2009
| XTREME OIL & GAS, INC. | |||
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By:
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/s/ Xxxxxxx X. XxXxxxxx III | |
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Xxxxxxx
X. XxXxxxxx III, President
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Employee
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| By: | /s/ Xxxxxxxx XxXxxx | ||
| Xxxxxxxx XxXxxx | |||
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