8
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as
of the 23rd day of August, 2006 by and between Westside Energy Corporation, a
Nevada corporation (referred to hereinafter as "Employer"), and Xxxxx X. Xxxxx
(referred to hereinafter as "Employee").
RECITALS:
WHEREAS, Employer desires to employ Employee, and Employee desires to
be employed by Employer; and
WHEREAS, Employer and Employee desire to set forth the terms and
conditions of Employee's employment with
Employer;
AGREEMENTS:
NOW, THEREFORE, in consideration of the premises and the mutual
covenants hereinafter set forth and for other good and valuable consideration,
the receipt, adequacy and sufficiency of which are hereby acknowledged by each
of Employer and Employee, each of Employer and Employee hereby agrees as
follows:
1. Employment. Employer hereby employs Employee, and Employee
hereby accepts such employment, subject in both cases to the
terms, provisions and conditions hereinafter stated. Employer
agrees to provide Employee with all initial specialized
training necessary for Employee to perform Employee's duties
hereunder. Moreover, Employer agrees to provide Employee with
all Confidential Information (as defined hereinafter)
necessary for Employee to perform such duties.
2. Title of Employee. Employee shall have the title of Employer's
Executive Vice President and General Counsel.
3. Duties of Employee. Employee shall perform all duties as from
time to time may be assigned to Employer by Employer's Board
of Directors or Employer's Chief Executive Officer.
4. Time Devoted and Exclusivity. Employee shall devote all of
Employee's business time and attention to performing
Employee's duties hereunder. During the term of this
Agreement, Employee agrees to work exclusively for Employer
and to provide the type of services for which Employer is
employing Employee to no person other than Employer; provided,
however, that Employee shall be permitted to devote an amount
of time sufficient to serve on the Boards of Directors of
other corporations, but only to the extent that such service
does not compete with the business of Employer and does not
interfere with Employee's duties hereunder.
5. Standard of Performance. In providing Employee's duties
hereunder, Employee shall use reasonable, and Employee's best,
efforts, and shall perform such duties in a competent,
professional and good xxxxxxx-like manner of the highest
caliber.
6. Place of Performance. Employee shall be based in, or within
five-miles of the city limits of, Dallas, Texas, but shall
undertake such travel at the direction of Employer's Board of
Directors or Employer's Chief Executive Officer as it, he or
she believes necessary or advisable for Employee to perform
Employee's duties hereunder.
7. Compensation and Benefits.
(a) Base Salary. As compensation for services rendered hereunder,
Employee shall be paid an annual salary of $175,000, or such
greater amount as shall be formally set by Employer's Board of
Directors. Such salary shall be paid in accordance with
Employer's payroll policies in effect from time to time.
(b) Sign-On Stock Bonus. Employer hereby agrees to pay to Employee
a sign-on bonus in the form of an issuance of unregistered
shares of Employer's common stock (the "Common Stock"), upon
the terms, conditions and provisions of this Section 7(b).
Pursuant to this Section 7(b), if Employee purchases for cash
directly from Employer 25,000 shares of Common Stock at any
time on or before 30 days after the Issuance Conditions (as
defined in Section 7(d) below) have been fulfilled (the shares
so purchased are referred to hereinafter as the "Direct
Purchase Shares"), Employee shall be entitled to be issued a
sign-on stock bonus comprised of 225,000 shares of
unregistered Common Stock (the shares comprising the sign-on
stock bonus are referred to hereinafter as the "Bonus
Shares"). In this connection, Employer hereby agrees to sell
to Employee, after the fulfillment of the Issuance Conditions
(which fulfillment Employer agrees to use reasonable best
efforts to effect), the 25,000 shares comprising the Direct
Purchase Shares at such purchase price as Employer and
Employee shall agree or (if the event that no such agreement
can be reached) at a purchase price equal to $3.00, the
closing price of the Common Stock on the day preceding the
date of this Agreement. Of the Bonus Shares, one-third shall
be not restricted (except for restrictions imposed by
applicable securities laws due to the private nature of the
issuance and Employee's status as an affiliate of Employer),
and a stock certificate representing them (with appropriate
legends) shall be delivered to Employee as soon as possible
after the purchase of the Direct Purchase Shares. The
remaining two-thirds of the Bonus Shares (the "Restricted
Bonus Shares") shall be restricted upon the following terms
(in addition to restrictions imposed by applicable securities
laws due to the private nature of the issuance):
(i) During the period during which the restrictions provided for
herein remain in effect (the "Restriction Period"), Employee
shall not be permitted to sell, transfer, pledge or assign any
Restricted Bonus Shares.
(ii) Except as otherwise provided for herein, Employee shall have,
with respect to the shares of Restricted Bonus Shares, all of
the rights of a stockholder of Employer, including the right
to vote the shares and the right to receive any cash
dividends.
(iii) The restrictions provided for herein with respect to one-half
of the Restricted Bonus Shares shall lapse on August 22, 2007,
provided that Employer has not previously and rightfully
terminated this Agreement. The restrictions provided for
herein with respect to the remaining one-half of the
Restricted Bonus Shares shall lapse on August 22, 2008,
provided that Employer has not previously terminated and
rightfully this Agreement.
(iv) If Employer has rightfully terminated this Agreement during
the Restriction Period, all Restricted Bonus Shares still
subject to restriction shall be forfeited by Employee.
(v) In addition to the stock certificate representing the
unrestricted Bonus Shares, Employee shall be issued two stock
certificates, each representing one-half of the Restricted
Bonus Shares. Each such certificate shall be registered in the
name of Employee and shall bear an appropriate legends
referring to (among other things) the terms, conditions, and
restrictions applicable to such issuance, substantially in the
following form:
"The transferability of this certificate and the shares of
stock represented hereby are subject to the terms and
conditions (including forfeiture) of an employment agreement
between the issuer and the stockholder hereof."
(vi) The stock certificates evidencing Restricted Bonus Shares
shall be held in custody by Employer until the restrictions
thereon shall have lapsed, and that, as a condition of any
Restricted Bonus Shares issuance, Employee shall have
delivered a stock power, endorsed in blank, relating to the
Restricted Bonus Shares. Certificates for Restricted Bonus
Stock without legends (other than those required by applicable
securities laws due to the private nature of the issuance)
shall be delivered to Employee promptly after, and only after,
the period of forfeiture shall have expired without forfeiture
in respect of such Restricted Bonus Shares.
(vii) In the event of special hardship circumstances of Employee,
including death, disability or retirement, or in the event of
an unforeseeable emergency of Employee, Employer's Board of
Directors may, in its sole discretion, when it finds that a
waiver would be in the best interest of Employer, waive in
whole or in part any or all remaining restrictions with
respect to Employee's Restricted Bonus Shares. Additionally,
in the event that Employee terminates Employee's employment
upon a "Change in Control" as provided in Section 10(b)
hereafter, all remaining restrictions with respect to
Employee's Restricted Bonus Shares shall automatically lapse.
(c) Additional Stock Bonuses.
(i) For purposes of this Section 7(c), the following terms shall
have the respective definitions assigned to the immediately
below:
"Market Value" per share of Common Stock at any date shall
mean the average of the daily Closing Price for the Common
Stock for the 30 Trading Days before such date.
"Closing Price" on a given day shall mean the last sale price
regular way or, in case no such reported sales take place on
such day, the average of the last reported bid and ask price,
regular way, in either case on the principal national
securities exchange or the NASDAQ/National Market System on
which the shares of Common Stock are admitted to trading or
listed, or if not so admitted or listed, the representative
closing bid price as reported by NASDAQ or other similar
organization if NASDAQ is no longer reporting such information
or, if not so available, the fair market price as reasonably
determined by Employer's Board of Directors.
"Trading Day" shall mean a day on which the principal national
securities exchange on which shares of Common Stock are listed
or admitted to trading is open for the transaction of business
or, if the shares of such Common Stock are not listed or
admitted to trading on any national securities exchange, a
Monday, Tuesday, Wednesday, Thursday or Friday on which
banking institutions in the Borough of Manhattan, City and
State of New York, are not authorized or obligated by law or
executive order to close.
(ii) Employer hereby agrees to pay to Employee additional bonuses
in the form of issuances of unregistered shares of Common
Stock, upon the terms, conditions and provisions of this
Section 7(c). Pursuant to this Section 7(c), Employee may
become entitled to be issued up to six tranches each comprised
of 87,500 shares of unregistered Common Stock, for an
aggregate of up to 525,000 shares of unregistered Common
Stock. One of these tranches comprised of 87,500 shares of
unregistered Common Stock shall be issued to Employee upon
each of the following events:
* when the Market Value relating to the Common Stock
first equals or exceeds $5.00 per share,
* when the Market Value relating to the Common Stock
first equals or exceeds $6.00 per share,
* when the Market Value relating to the Common Stock
first equals or exceeds $7.00 per share,
* when the Market Value relating to the Common Stock
first equals or exceeds $8.00 per share,
* when the Market Value relating to the Common Stock
first equals or exceeds $9.00 per share, and
* when the Market Value relating to the Common Stock
first equals or exceeds $10.00 per share.
(iii) If the outstanding shares of the Common Stock shall be
subdivided into a greater number of shares or a dividend in
Common Stock shall be paid in respect of Common Stock, the
figures for the Market Value as stated immediately above in
effect immediately prior to such subdivision or at the record
date of such dividend shall simultaneously with the
effectiveness of such subdivision or immediately after the
record date of such dividend be proportionately reduced. If
the outstanding shares of Common Stock shall be combined into
a smaller number of shares, the figures for the Market Value
as stated immediately above in effect immediately prior to
such combination shall, simultaneously with the effectiveness
of such combination, be proportionately increased. When any
adjustment is required to be made in the Market Value, the
number of shares comprising the tranches making up the bonuses
to be paid pursuant to this Section 7(c) shall be changed to
the number determined by dividing (i) an amount equal to the
number of shares comprising the tranches immediately prior to
such adjustment, multiplied by the Market Value in effect
immediately prior to such adjustment, by (ii) the Market Value
in effect immediately after such adjustment.
(iv) In the event that Employee terminates Employee's employment
upon a "Change in Control" as provided in Section 10(b)
hereafter, Employee shall be entitled to be issued immediately
pursuant to this Section 7(c) all of the 525,000 shares of
Common Stock that have not already been issued pursuant to
this Section 7(c).
(d) The issuance of any and all of the Direct Purchase Shares, the
Bonus Shares and the shares constituting the additional bonus
shares provided for in Section 7(c) is subject to the approval
of a majority of Employer's outstanding shares and the listing
of the shares to be issued in connection herewith with the
American Stock Exchange (the two conditions imposed by this
Section 7(d) are referred to hereinafter as the "Issuance
Conditions").
(e) Benefits. Employee shall be entitled to participate in all
plans that Employer establishes for the benefit of its
employees; provided, however, Employee shall be entitled to
participate in such plans only at the time Employee meets the
eligibility criteria established for the plan and shall
receive benefits thereunder based on the terms of the plan.
Employee's eligibility and benefit level shall be determined
separately for each plan, and all determinations shall be made
by the parties charged with responsibility for such
determinations in the plan. Employer is under no obligation to
establish any plan or plans to provide benefits for its
employees, and this Section 7(e) shall not be interpreted to
require the establishment of any benefit plan. The terms of
any benefit plans existing, established, or provided hereafter
do not constitute a part of this Agreement and are not
incorporated herein for any purpose.
8. Expense Reimbursement. Employer shall reimburse Employee, from
time to time, for all actual, reasonable and necessary
business expenses incurred by Employee on behalf of Employer,
to the extent that Employee has presented to Employer
documentary evidence, such as a receipt or a paid xxxx, that
states sufficient information to establish the amount, date,
place, and the essential character of the expenditure for each
such expenditure.
9. Term. Subject to Section 10 below, the term of this Agreement
shall begin on the date hereof and shall continue for the
period of two years thereafter.
10. Termination.
(a) By Employer For Cause. Employer may, at its election,
terminate Employee's employment at any time for just cause,
which shall mean the following: (i) Employee shall have failed
or refused to faithfully, diligently and competently perform
the duties assigned to Employee under this Agreement or
otherwise to have breached any term or provision contained
herein and such failure, refusal or breach continues for a
period of 30 days after written notice thereof is given by
Employer to Employee; (ii) Employee shall be disabled or
otherwise unable for whatever reason to fully perform
Employee's duties hereunder for 60 consecutive days or for
more than 120 days in any twelve-month period; (iii) Employee
shall be guilty of fraud, dishonesty, or similar acts of
misconduct; or (iv) Employee shall be finally convicted of a
felony or a misdemeanor involving moral turpitude. At any time
after the occurrence of an event permitting Employer to
terminate Employee's employment pursuant to this Section
10(a), Employer may elect for termination of Employee's
employment by notifying Employee as to Employer's election to
terminate, and thereupon Employee's employment with Employer
will terminate on the date specified in the notice or (if no
date is specified) upon the delivery of the notice.
(b) By Employee Upon a Change in Control. Employee may, at his
election, terminate Employee's employment at any time upon a
"Change in Control" after the giving of 15 days written
notice, and thereupon Employee's employment with Employer will
terminate 15 days after the giving of the notice or (if later)
on the date specified in the notice. For purposes of this
Agreement, a "Change in Control" shall mean the approval by
the stockholders of Employer of: (I) a merger, consolidation,
share exchange or reorganization involving Employer, unless
the stockholders of Employer, immediately before such merger,
consolidation, share exchange or reorganization, own, directly
or indirectly immediately following such merger,
consolidation, share exchange or reorganization, at least 80%
of the combined voting power of the outstanding Voting
Securities of the corporation that is the successor in such
merger, consolidation, share exchange or reorganization in
substantially the same proportion as their ownership of the
Voting Securities immediately before such merger,
consolidation, share exchange or reorganization; (II) a
complete liquidation or dissolution of Employer; or (III) an
agreement for the sale or other disposition of all or
substantially all of the assets of Employer.
(c) Automatic. The term of this Agreement shall automatically
terminate upon Employee's death.
(d) Effect. Upon termination of this Agreement, all rights and
obligations under this Agreement shall cease except for the
rights and obligations under Section 11, 12, and 13 of this
Agreement and the rights and obligations under Section 7 of
this Agreement to the extent Employee had not been compensated
for services performed prior to termination (Employee's salary
to be pro rated for the portion of the pay period prior to
termination).
11. Confidentiality.
(a) "Confidential Information" means and refers to information
and materials belonging to Employer that are not generally
known outside Employer, including, without limitation,
customers and customer lists, pricing policies, operational
procedures, sources of supply, methods, formulae, processes,
software programs, hardware configurations, know-how, computer
programs and access codes, technological information,
information relating to the cost of its products and services,
marketing strategies, financial statements and projections,
and any other information which bears a logical relationship
to the Confidential Information described above such that
Employee knows or should logically conclude that Employer
regards the information to be Confidential Information.
Confidential Information shall not include any knowledge or
information that Employee already knows as of the date of this
Agreement, that is already known to the general public as of
the date of this Agreement or that becomes known to the
general public after the date of this Agreement through no
breach of Employee's confidentiality obligations.
(b) Employee hereby recognizes and acknowledges that Employee
may receive information from, or may develop information on
the behalf of, Employer Confidential Information. In
consideration of and ancillary to Employer's agreement to
provide Confidential Information to Employee contained in
Section 1 above, Employee hereby agrees to maintain on a
confidential basis all Confidential Information, and Employee
agrees that Employee shall not, without the prior express
written consent of Employer, use for Employee's or anyone
else's benefit or disclose to any other person any
Confidential Information, except in connection with Employee's
work on behalf of Employer. Employee hereby acknowledges that,
as between Employer and Employee, Employer has the complete,
sole and full right, title and interest in and to the
Confidential Information, and that Employee has no rights,
expressed or implied, with respect to the foregoing other than
those expressly provided for to the contrary in a writing
signed by both Employer and Employee. Employee further agrees
that Employee shall, immediately upon Employer's request,
return to Employer all written Confidential Information and
all writings regarding oral Confidential Information whether
such writings were authorized or not. Employee hereby agrees
that the confidentiality agreement provided for hereby shall
last with respect to any Confidential Information for two
years after such Confidential Information is disclosed by
Employer to Employee or developed by Employee on behalf of
Employer, as the case may be.
12. Property of Employer. Employee agrees that, upon the
expiration or termination of Employee's employment with
Employer, Employee will immediately surrender to Employer all
property, equipment, funds, lists, books, records, and other
materials of Employer or any affiliate thereof in the
possession of or provided to Employee.
13. Law Governing. THIS AGREEMENT HAS BEEN ENTERED INTO IN THE
STATE OF TEXAS AND SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.
14. Notices. Any notice or request herein required or permitted to
be given to any party hereunder shall be given in writing and
shall be personally delivered or sent to such party by prepaid
mail at the address set forth below the signature of such
party hereto or at such other address as such party may
designate by written communication to the other party to this
Agreement. Each notice given in accordance with this paragraph
shall be deemed to have been given, if personally delivered,
on the date personally delivered, or, if mailed, on the third
day following the day on which it is deposited in the United
States mail, certified or registered mail, return receipt
requested, with postage prepaid.
15. Headings. The headings of the paragraphs of this Agreement
have been inserted for convenience of reference only and shall
in no way restrict or modify any of the terms or provisions
hereof.
16. Severability. If any provision of this Agreement is held to be
illegal, invalid, or unenforceable under present or future
laws effective during the term hereof, such provision shall be
fully severable and this Agreement shall be construed and
enforced as if such illegal, invalid or unenforceable
provision had never comprised a part of this Agreement and the
remaining provisions of this Agreement shall remain in full
force and effect and shall not be affected by the illegal,
invalid or unenforceable provision or by its severance from
this Agreement. Furthermore, in lieu of such illegal, invalid
or unenforceable provision, there shall be added automatically
as a part of this Agreement a provision as similar in terms to
such illegal, invalid, or unenforceable provision as may be
possible and be legal, valid, and enforceable.
17. Entire Agreement. This Agreement embodies the entire agreement
and understanding between the parties hereto with respect to
the subject matter hereof and supersede all prior agreements
and understandings, whether written or oral, relating to the
subject matter hereof.
18. Binding Effect. This Agreement shall be binding upon and shall
inure to the benefit of each party hereto and his, her or its
respective successors, heirs, assigns, and legal
representatives, but neither this Agreement nor any rights
hereunder may be assigned by any party hereto without the
consent in writing of the other party.
19. Remedies. No remedy conferred by any of the specific
provisions of this Agreement is intended to be exclusive of
any other remedy, and each and every remedy shall be
cumulative and shall be in addition to every other remedy
given hereunder or now or hereafter existing at law or in
equity or by statute or otherwise. The election of any one or
more remedies by any party hereto shall not constitute a
waiver of the right to pursue other available remedies.
IN WITNESS WHEREOF, the undersigned have set their hands hereunto as of
the first date written above.
"EMPLOYER" "EMPLOYEE"
WESTSIDE ENERGY CORPORATION
(Name of Employer)
By: /s/Xxxx Manner /s/ Xxxxx X. Xxxxx
-------------- --------------
Xxxx Manner, CEO Xxxxx X. Xxxxx
