EMPLOYMENT AGREEMENT
EXHIBIT
10.1
This
Employment Agreement (thereafter referred as "Agreement") is made effective on
June 1, 2010, by and between Savoy Energy Corporation, a Nevada corporation
(hereinafter referred to as "Savoy", "Company," or "Employer"), and Xxxxxx X.
Xxxxxxxxxxx (hereinafter referred to as "Executive").
RECITALS
X. Xxxxx
is engaged in the business of the up-stream oil and gas industry;
and
B. Executive
is to be employed by Savoy as its President and Chief Executive Officer,
and
X. Xxxxx
desires to engage Executive as its President and Chief Executive Officer;
and
D. Executive
is desirous of accepting employment in such a position pursuant to the terms and
conditions, and for the consideration, hereinafter set forth;
NOW THEREFORE, for and in
consideration of the mutual promises, covenants and obligations contained
herein, Savoy and Executive agree as follows.
AGREEMENT
ARTICLE
1. EMPLOYMENT AND DUTIES
1.1 Employment; Effective
Date
Effective
as of June 1, 2010
(the "Effective Date").
1.2 Position
Savoy
hereby agrees to employ Executive, and Executive hereby accepts employment as
Savoy President and Chief Executive Officer upon the terms and conditions
hereinafter set forth, each Party expressly revoking any and all prior
employment agreements to which the Parties may be mutually subject. As
President and Chief Executive Officer, Executive shall serve Savoy and its
affiliates on a full-time basis subject to the supervision and control of the
Board of Directors (hereinafter referred to as the "Board"). Executive hereby
agrees to serve Savoy in such capacity for the period commencing on the
Effective Date and ending on the Termination of this agreement pursuant to
Section 2.1 below.
1.3 Services of
Executive
During
the Term of this Agreement (as hereinafter defined), the Executive shall perform
the services hereunder (i) for the compensation set forth herein and without
additional compensation unless otherwise agreed to between Savoy and the
Executive, (ii) in such employment capacity for Savoy or any subsidiary or
affiliate thereof to which he may be directed by the Board of Savoy or of any
such subsidiary or affiliate, or (iii) as a member of the Board of Savoy or of
any subsidiary or affiliate thereof if so elected by the shareholders of Savoy
or any such subsidiary or affiliate. In that regard, Savoy intends to
appoint the Executive to its Board of Directors and as a director of each of its
subsidiaries which is involved in the service operations and which report
directly to the Executive. Savoy may also utilize the Executive in any
other work or activity in furtherance of the business of Savoy in which his
talents may be applied in a manner commensurate with his position, training,
knowledge, skills and abilities.
1.4 Duties and
Services
Executive
agrees to serve in the position referred to in Section 1.2 and to perform
diligently and to the best of his abilities the duties and services appertaining
to such offices. Executive shall also perform such other duties and services
appropriate to such position which the parties mutually may agree upon from time
to time. In addition, Executive agrees to provide such other and unrelated
services and duties as may be mutually agreed upon by Savoy and
Executive.
1.5 Other
Interests
Executive
agrees, during the period of his employment by Savoy, to devote substantially
all of his business time, energy and best efforts to the business and affairs of
Savoy and its affiliates and not to engage, directly or indirectly, in any other
business or businesses, whether or not similar to that of Savoy, except with the
consent of the Board of Directors of Savoy (the "Board"). The foregoing
notwithstanding, the parties recognize and agree that Executive may engage in
other business activities that do not conflict with the business and affairs of
Savoy or interfere with Executive's performance of his duties hereunder, which
shall be at the sole determination of the Board.
1.6 Duty of
Loyalty
Executive
acknowledges and agrees that Executive owes a fiduciary duty of loyalty to act
at all times in the best interests of Savoy. In keeping with such duty,
Executive shall make full disclosure to Savoy of all business opportunities
pertaining to Savoy's business and shall not appropriate for Executive's own
benefit business opportunities concerning Savoy's business.
ARTICLE
2. TERM AND TERMINATION OF EMPLOYMENT
2.1 Term
Unless
terminated at an earlier date in accordance with Section 2.2 of this
Agreement, the initial term of Executive's employment hereunder shall be for a
period of two (2) years, commencing on the Effective Date ("Initial Term").
Thereafter, the term of this Agreement shall be automatically extended for
successive one year periods (each an "Additional Term") unless either party
objects to such extension by written notice to the other party at least one (1)
year prior to end of the Initial Term or any Additional Term. The Initial
Term and any Additional Terms shall be referred to collectively as the "Term."
Except for termination pursuant to Section 2.2 below, the Company
acknowledges and agrees that it will not terminate this Agreement during the
Initial Term.
2.2 Savoy's Right to
Terminate
Notwithstanding
the provisions of paragraph 2.1, Savoy shall have the right to terminate
Executive's employment under this Agreement at any time for the following
reasons:
(i) upon
Executive’s death;
(ii) upon
the inability of Executive to perform the essential duties of his position by
reason of illness, physical or mental disability or other incapacity for a
period of one (1) calendar year or any shorter periods aggregating one (1) year
in any two-year period ("Disability"); or
(iii) for
"Cause," which shall mean Executive (A) has engaged in gross negligence or
willful misconduct in the performance of the duties required of him hereunder,
(B) has willfully refused without proper legal reason to perform the duties and
responsibilities required of him hereunder, (C) has breached any material
provision of this Agreement or any material corporate policy maintained and
established by Savoy that is of general applicability to the Company's employees
and such breach is not cured within thirty (30) days from the date of receipt of
written notice from Employer by Executive regarding the alleged breach, (D) has
willfully engaged in conduct that he knows or should know is materially
injurious to Savoy or any of its affiliates, or (E) has been convicted of, or
pleaded no contest to any felony, provided, however, that Executive's employment
may be terminated for Cause only if such termination is approved by at least a
majority of a quorum (as defined in Savoy's By-Laws) of the members of the Board
after Executive has been given written notice by Savoy of the specific reason
for such termination and an opportunity for Executive, together with his
counsel, to be heard before the Board.
(iv) Termination
without “cause” at any time, provided the Company provides thirty (30) days
notice or payment in lieu regardless of the age of the contract, provided,
however, that Executive’s employment may be terminated without Cause only if
such termination is approved by at least a majority of a quorum (as defined in
Savoy’s by-Laws) of the members of the Board after Executive has been given
written notice by Savoy regarding termination and an opportunity for Executive,
together with his counsel, to be heard before the Board.
2.3 Key Employee's Rights to
Terminate
Notwithstanding
the provisions of Sections 2.1 and 2.2, Executive shall have the right to
terminate his employment under this Agreement for any of the following
reasons:
(i) for
"Good Reason," which shall mean, within sixty (60) days of and in connection
with or based upon (A) a material breach by Savoy of any material provision of
this Agreement, (B) a significant reduction in the nature or scope of
Executive's duties and responsibilities, (C) the assignment to Executive of
duties and responsibilities that are materially inconsistent with the position
referred to in Section 1.1, or (D) any requirement that Executive relocate
to a site more than fifty (50) miles from his present business address (unless
such move is within twenty-five (25) miles of Executive's present home address)
provided, however, that prior to Executive's termination for Good Reason,
Executive must give written notice to Savoy of any such breach, reduction,
assignment or requirement and such breach, assignment or requirement must remain
uncorrected for ten (10) days following such written notice; or
(ii) at
any time for any reason whatsoever, in the sole discretion of Executive,
provided that the Executive gives Savoy ninety (90) days written
notice.
2.4 Deemed
Resignations
Any
termination of Executive's employment shall constitute an automatic resignation
of Executive as an officer of Savoy and each affiliate of Savoy, and an
automatic resignation of Executive from the Board (if applicable) and from the
board of directors of any affiliate of Savoy.
2.5 Involuntary Termination
After "Change of Control."
In
the event of a "Change of Control" as defined below, Savoy shall have the right
to terminate Executive's employment and this Agreement at will. Should
Savoy exercise this option to involuntarily terminate Executive during the
pendency of this Agreement for any reason other than as specified in
Section 2.2(iii) within twelve (12) months following a defined Change of
Control, Executive shall be entitled to an immediate cash payment equal in
amount to twelve (12) months of compensation based upon a monthly proration of
his Form W-2 earning from Savoy in the year preceding such termination and (ii)
the fair value of eighteen months of Executive's then current fringe benefits
provided by Company..
In the
event there is a Change of Control during the pendency of this Agreement, and
Savoy gives Executive notice of intent to not thereafter renew the Agreement for
a successive term, should Executive be involuntarily terminated from employment
after expiration of the Agreement and within twelve (12) months following the
Change of Control, Executive shall be entitled to an immediate cash payment in
the amount set forth in the preceding paragraph. The contractual right to
such payment is expressly agreed to be a covenant which shall survive expiration
of this Agreement, and be enforceable hereunder.
For
purposes of this Agreement, a "Change of Control" shall be deemed to have taken
place if: (i) a third person, including a "group" as determined in accordance
with Section 13(d)(3) of the Securities Exchange Act of 1934, becomes the
beneficial owner of shares of Savoy having more than fifty percent (50%) of the
total number of votes that may be cast for the election of directors of Savoy;
or (ii) as a result of, or in connection with, any cash tender or exchange
offer, merger or other business combination, sale of assets or contested
election, or any combination of the foregoing transactions
(a "Transaction"), the persons who were directors of Savoy before the
Transaction shall cease to constitute a majority of the Board of Savoy or any
successor to Savoy.
ARTICLE
3. COMPENSATION AND BENEFITS
3.1 Base
Salary
During
the first twelve month period of the initial term of this Agreement, Executive
shall receive a minimum monthly base salary of $15,000 ("Base Salary").
The Base Salary shall be reviewed and increased by the Board (or a
committee or designee thereof) after the first twelve (12) months of employment.
Thereafter, Executive's monthly Base Salary shall be reviewed by the Board (or a
committee or designee thereof) on an annual basis from the Effective Date (or
more frequently, should the Board decide to do so), and, in the sole discretion
of the Board (or such committee or designee thereof), such annual Base Salary
may be increased, but not decreased, effective as of any date determined by the
Board. Executive's monthly Base Salary shall be paid in equal installments, less
amounts for withholding of taxes and/or others amounts required by statutes, and
consistent with Savoy's standard policy regarding payment of compensation to
employees but no less frequently than semi-monthly.
3.2 Bonuses and
Commissions
Executive
shall be eligible to participate in Savoy's Bonus Plan and Savoy's Long Term
Incentive Compensation Program as may be adopted and approved from time to time
by the Board (or a committee or designee thereof).
3.3 Issuance of Restricted
Stock
(i) As
a non-cash equity component to Executive’s compensation, during the Term of this
Agreement, Executive shall receive annual grants of 60,000 shares from the
Company’s Stock Option Plan, which shall vest in increments of 5,000 shares of
common stock per month.
(ii) Except
for termination of this Agreement for cause pursuant to Section 2.2(iii),
any termination of this Agreement by Company shall cause the immediate vesting
of any shares of common stock that otherwise would have been issued by Company
to Executive during the Term of this agreement.
Further
restricted stock allocations awards will be based on a combination of the
performance of Executive and the Company based on criteria and milestones
established by the board of directors (or management compensation committee, as
applicable).
3.4 Other
Perquisites
During
his employment hereunder, Executive shall be afforded the following benefits as
incidences of his employment.
(i) Vacation: Executive
shall be entitled to ten (10) business days of paid vacation for each calendar
year of employment. Such vacation must be taken at a time mutually convenient to
Company and Executive. All vacation days must be taken during the year it
is earned and cannot be carried forward into a future year without the written
consent of Company, which will not be unreasonably withheld.
(ii) Personal Leave:
Executive shall be entitled to five (5) days paid time each calendar year.
Unused personal leave benefits cannot be carried forward into a future
year without the written consent of Savoy. The following rule shall
apply:
If
Executive is unable to work for more than five (5) days for reasons unrelated to
the Company’s business, and if Executive's unused personal leave is insufficient
for such period, the Executive's unused vacation time shall be applied to such
absence.
(iii) Holidays: Executive
shall be entitled to holidays with pay during each calendar year in accordance
with Savoy's posted holiday schedule.
(iv) Other Company Benefits:
Executive and, to the extent applicable, Executive's spouse, dependents
and beneficiaries, shall be allowed to participate in all benefits, plan, and
programs, including improvements or modifications of the same, which are now, or
may hereafter be, available to other employees of Savoy. Such benefits,
plans and programs may include, without limitation, any profit sharing, thrift
plan, life insurance, disability insurance, pension plan (company supported),
supplemental retirement plan, vacation and sick leave plan, and the like which
may be maintained by the Company. The Company shall not, however, by
reason of this paragraph be obligated to institute, maintain, or refrain from
changing, amending or discontinuing, any such benefit plan or program, so long
as such changes are similarly applicable to employees generally.
3.5 Business and Entertainment
Expenses
Subject
to Savoy's standard policies and procedures with respect to reimbursement as
applied to its employees generally, Savoy shall promptly reimburse Executive
for, or pay on behalf of Executive, reasonable and appropriate expenses incurred
by Executive for business related purposes, including travel, dues and fees to
industry and professional organizations, subscriptions to professional and
business publications, costs of business-related entertainment and business
development, and mobile phone expenses.
ARTICLE
4. DUTY OF LOYALTY
During
the term of this Agreement, Executive will not, without the prior written
consent of Company, engage in any activity directly competitive with the
business or welfare of Company, whether alone, as a partner, or as an officer,
director, employee, consultant, or holder of more than one percent of the
capital stock of any other corporation.
ARTICLE 5. CONFIDENTIAL
INFORMATION
5.1 Trade
Secrets of Company
Executive,
by reason of his prior employment with the Company and during the term of this
Agreement, has and will develop, have access to and become acquainted with
various trade secrets which are owned by Company and which are regularly used in
the operation of its business. Executive will not disclose such trade secrets,
directly or indirectly, or use them in any way, either during the term of this
Agreement or at any time thereafter, except as required in the course of his
employment by Company. All files, contracts, manuals, reports, letters, forms,
documents, notes, notebooks, lists, records, documents, customer lists, vendor
lists, purchase information, designs, computer programs and similar items and
information relating to the businesses of such entities, whether prepared by
Executive or otherwise and whether now existing or prepared at a future time,
coming into his possession will remain the exclusive property of
Company.
5.2
Confidential
Data of Customers of Company
Executive,
in the course of his duties, will have access to and become acquainted with
financial, accounting, statistical and personal data of customers of Company and
of its and their affiliates. All such data is confidential and will not be
disclosed, directly or indirectly, or used by Executive in any way, either
during the term of this Agreement (except as required in the course of
Executive’s employment by Company) or at any time thereafter.
5.3
Intellectual
Properties
Executive will sign a Confidentiality
Agreement (the “Confidentiality Agreement”) with the Company prior to or on the
effective date of this Agreement.
5.4
Continuing
Effect
The
provisions of this Section 5 will remain in effect for a period of one (1) year
after the effective date of termination of Executive’s employment with
Company.
ARTICLE 6. NONCOMPETITION AND
SOLICITATION
6.1 Prohibited
Activities
The
Executive hereby covenants and agrees that during the Term and for one (1) year
immediately following the termination by the Company or the Executive, as
applicable, of the Executive's employment, he shall not, without the prior
written consent of the Company’s board of directors, at any time, directly or
indirectly, on his own behalf or on behalf of any person:
(a) directly
or indirectly own, manage, operate, control, be employed by, participate in,
provide consulting services to, or be connected or associated in any manner with
the ownership, management, operation or control of any business which is in
competition with the Company in the marketing of products which are
substantially similar to the products distributed by the Company in any state of
the United States or in any foreign country in which the Company is engaged in
business during the Term in the case of acts committed during the Term or in any
state of the United States or in any foreign country in which the Company is
engaged in business at the time of termination of Executive's employment in the
case of acts committed after the Term for as long as the Company continues to
conduct such business. In the case of an entity which distributes
multiple product lines, the Executive shall be deemed to be in violation of this
provision only if he is directly involved in the division of such entity which
is engaged in the marketing and/or distribution of products which are
substantially similar to the products marketed and/or distributed by the
Company; provided, however;
that nothing in this Employment Agreement shall preclude the Executive
from owning less than five percent of any class of publicly traded equity of any
entity.
(b) solicit
or take any action to cause the solicitation of, or recommend that, any
supplier, client, customer, contractor, vendor, agent or consultant of the
Company or any of its subsidiaries or other person having business relations
with the Company, discontinue business or cease such relationship, in whole or
in part, with the Company or any of its subsidiaries,
(c) employ
any person employed by the Company or any of its subsidiaries at the time of or
during the 12 months preceding, such termination of the Executive's employment
with the Company.
(d) solicit
for employment (other than through unaffiliated employment recruiting or
placement firms or services who are not specifically directed to solicit
employees of the Company or provided with the names of any such employees) any
person employed by the Company or any of its subsidiaries at the time of, or
during the 12 months preceding such termination of the Executive's employment
with the Company, or otherwise encourage or entice any such Person to leave such
employment.
6.2 Savings
Provision
The
Executive acknowledges and agrees that:
(a) the
restrictive covenants set forth in this Section (the “Restrictive
Covenants") are reasonable and valid in geographical and temporal scope and in
all other respects, and
(b) it
is the intention of the parties hereto that the Restrictive Covenants be
enforceable to the fullest extent permitted by applicable law. Therefore, if any
court determines that any of the Restrictive Covenants, or any part thereof, is
invalid or unenforceable, the remainder of the Restrictive Covenants shall not
thereby be affected and shall be given full force and effect, without regard to
the invalid or unenforceable parts and such court shall have the power to modify
such Restrictive Covenant, or any part thereof, and, in its modified form, such
Restrictive Covenants shall then be valid and enforceable.
ARTICLE
7.
MISCELLANEOUS
7.1 Notices
All
notices required or permitted under this Agreement shall be in writing and shall
be deemed delivered when delivered in person or deposited in the United States
mail, postage paid, addressed as follows:
|
If
to the Company
|
|
|
To:
|
Savoy
Energy, Inc.
00000
Xxxxxxxxxx, Xxx. 000
Xxxxxxx,
Xxxxx 00000
|
|
If
to Executive
|
|
|
To:
|
Xxxxxx
X. Xxxxxxxxxxx
0000
Xxxxxxxxx Xx.
Xxxxxxxx
Xxxx, Xxxxx 00000
|
Such
addresses may be changed from time to time by either party providing written
notice in the manner set forth above.
7.2 Applicable
Law
This
agreement is entered into under, and shall be governed for all purposes by, the
laws of the State of Texas.
7.3 No
Waiver
No
failure by either party hereto at any time to give notice of any breach by the
other party of or to require compliance with, any condition or provision of this
Agreement shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time.
7.4 Severability
If a
court of competent jurisdiction determines that any provision of this Agreement
is invalid or unenforceable, then the invalidity or unenforceability of that
provision shall not affect the validity or enforceability of any other provision
of this Agreement, and all other provisions shall remain in full force and
effect.
7.5 Counterparts
This
Agreement may be executed in one or more counterparts, each of which shall be
deemed to be an original, but all of which together will constitute one and the
same Agreement.
7.6 Withholding of Taxes and
Other Employee Deductions
The
Company may withhold from any benefits and payments made pursuant to this
Agreement all federal, state, city and taxes as may be required pursuant to any
law or governmental regulation or ruling and all other normal employee
deductions made with respect to Savoy's employees generally.
7.7 Headings
The
paragraph headings have been inserted for purposes of convenience and shall not
be used for interpretive purposes.
7.8 Gender and
Plurals
Wherever
the context so requires, the masculine gender includes the feminine or neuter,
and the singular number includes plural and conversely.
7.9 Affiliate
As used
in this Agreement, the term "affiliate" shall mean any entity which owns or
controls, is owned or controlled by, or is under common ownership or control
with Savoy.
7.10 Assignment
This
Agreement shall be binding upon and inure to the benefit of Savoy and any
successor of the Company, by merger or otherwise. Except as provided in
the preceding sentence, this Agreement, and the rights and obligations of the
parties hereunder, are personal and neither this Agreement, nor any right,
benefit, or obligation of either party hereto, shall be subject to voluntary or
involuntary assignment, alienation or transfer, whether by operation of law or
otherwise, without the prior written consent of the other party.
7.11 Term
Other
than the provisions of this Agreement which specifically extend beyond the the
term of employment stated in Section 2.1, this Agreement shall be
co-terminus with such term. Termination shall not affect any right or
obligation of any party that is accrued or vested prior to such
termination.
7.12 Entire
Agreement
Except as
specifically referenced herein, this Agreement constitutes the entire agreement
of the parties with regard to the subject matter hereof, and contains all the
covenants, promises, representations, warranties and agreements between the
parties with respect to employment of Executive by Savoy. Without limiting
the scope of the preceding sentence, all understandings and agreements preceding
the date of execution of this Agreement and relating to the subject matter
hereof are hereby null and void and of no further force and effect. Any
modifications or amendments will be made in writing and signed by both parties
and will form part of this agreement.
[Signature
page follows]
IN WITNESS WHEREOF, the
parties hereto have executed this Agreement on July 27, 2010, to be effective as
of the Effective Date.
EMPLOYER:
Savoy
Energy Corporation
By: /s/
Xxxxxxx Xxxxxxx
Xxxxxxx
Xxxxxxx, Compensation Committee Chairman
EXECUTIVE:
/s/
Xxxxxx X. Xxxxxxxxxxx
Xxxxxx X.
Xxxxxxxxxxx
