RETIREMENT, SEVERANCE AND TERMINATION
OF EMPLOYMENT AGREEMENT
THIS RETIREMENT, SEVERANCE AND TERMINATION OF EMPLOYMENT AGREEMENT is
between Xxxxx Oil and Gas Company, a Nevada corporation ("Company") and J. N.
"Newt" Xxxxxxxxxx ("Employee"), shall be effective January 1, 1998 and is made
with reference to the following agreed facts.
A. Employee has been employed as a full time executive officer of the
Company pursuant to an Employment Agreement dated as of December 27, 1994 (the
"Employment Agreement").
B. Pursuant to a change in the business of the Company and the fact
Employee has reached the age of 62, the, Employee shall retire and not be
employed by the Company after December 31, 1997.
C. The parties desire and intend to set forth the terms upon which the
Employment Agreement shall be terminated.
FOR CONSIDERATION, the receipt and sufficiency of which is hereby
acknowledge, the Company and Employee agree as follows:
1. Retirement and Cessation of Employment. The Employee shall continue
to be employed as a full time employee and as an Executive Vice President of the
Company through December 31, 1997. Since the Employee has reached the age of 62,
on January 1, 1998, the Employee will retire from the Company and shall tender,
in writing, his resignation as an officer of the Company and its subsidiaries.
2. Severance Compensation. Commencing January 1998, the Employee, or
his assignee, will be compensated at a rate of $4,500 per month for the first
twelve (12) months and $3,785 for the next twenty (20) months, for a total of
$129,700 dollars, unless this Agreement is previously terminated due to the
death. Each monthly payment will be tendered by the Company on or about the
tenth of each month. Upon the death of the Employee, at the end of the month
next following such event, the Company shall pay to the estate of the Employee,
an amount equal to the difference between $82,500 and the gross amounts
previously paid to Employee pursuant to this paragraph 2 of this Agreement.
3. Options. The stock purchase options previously granted and currently
held by the Employee, as identified on Exhibit A, shall each retain the original
terms in accordance with applicable provisions of the Company's Stock Option
Plans.
4. Transfer of Assets. Effective at the time of cessation of full time
employment, the Company shall transfer to the Employee the Company assets
described on Exhibit B. Employee acknowledges that the Company shall treat the
estimated fair market value of the assets as 1997 income to Employee and shall
so notify taxing authorities.
5. Special Training. At a time selected by the Employee, but not later
than July 1, 1998, the Company shall pay up to $2,500 in tuition and expenses
necessary for Employee to attend the M.M.S.' basic course on oil and gas well
completion and workover or similar course.
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6. Use of Office Space. The Company shall make reasonable efforts to
provide Employee office space at the offices of the Company for so long as the
Company has extra space not being used for other Company business purposes. The
space provided may or may not consist of the space that Employee is currently
occupying and the Company is under no obligation to provide office space should
its business requirements change. Employee may use such offices for conducting
Company business or other unrelated business and shall at all times conduct
himself in a manner consistent with the best interests of the Company and the
other employees. The Employee shall install and pay for his own phone line and
reimburse the Company for ancillary uses of existing office equipment owned by
the Company (e.g., copier, phone, facsimile, etc.).
7. Future Consulting Services. During the term of this Agreement, the
Employee agrees to be available, on a reasonable and mutually agreeable basis,
to perform consulting services on an as needed basis for the Company or
affiliates of the Company. It is specifically agreed that there is no obligation
in this Agreement for the Company to retain the Employee on a consulting basis
and any such consulting services shall be performed in accordance with one or
more separate consulting agreements which may be entered into from time to time
in the future.
8. Service as a Director. The parties acknowledge that until November
7, 1997, Employee served as a director of the Company and its subsidiaries, and
that Employee resigned as a director, on his own volition, effective that date.
By signing this Agreement, the Company and the Employee confirm that the
resignation by the Employee was not a condition of, nor conditional upon, this
Agreement.
9. Termination of Prior Employment Agreement. The rights and
obligations of the parties as set forth in the Employment Agreement hereby are
terminated and shall be of no further effect and, other than as set forth in
this Agreement, the Company shall have no other obligations whatsoever to the
Employee. Employee hereby waives and releases any obligation by the Company
under the Employment Agreement and any other claims which Employee might
otherwise assert against the Company or its officers or directors except as set
forth in this Agreement.
10. General Release. Employee, on his own behalf, and on behalf of his
heirs and assigns, hereby fully and forever unconditionally releases and
discharges the Company, all of its past and present parent, subsidiary,
affiliated and related corporations, their predecessors, successors and assigns,
together with their divisions and departments, and all past or present officers,
directors, employees, insurers and agents of any of them, (hereinafter referred
to collectively as "Releasees"), of and from, and covenants not to xxx or assert
against Releasees, for any purpose, all claims, administrative complaints,
demands, actions and causes of action, of every kind and nature whatsoever,
whether at law or in equity, arising from or in any way related to my employment
by the Company including the termination thereof, based in whole or in part upon
any act or omission concerning on or before the date of this general release,
whether negligent or intentional, without regard to Employee's present actual
knowledge of the act or omission, which Employee may now have, or which
Employee, or any person acting on his behalf may at any future time have or
claim to have, including specifically, but not by way of limitation, unpaid
wages, unpaid benefits, matters which may arise at common law, such as breach of
contract, express or implied, promissory estoppel, wrongful discharge, tortious
interference with contractual rights, infliction of emotional distress,
defamation, or under federal, state or local laws, such as the Fair Labor
Standards Act, the Employee Retirement Income Security Act, the National Labor
Relations Act, Title VII of the Civil Rights Act of 1964, the Age Discrimination
in Employment Act, the Rehabilitation Act of 1973, the Americans with
Disabilities Act, the Family and Medical Leave Act, the Pregnancy Disability
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Act, the Equal Pay Act, and the Colorado Civil Rights Act, excepting only
retirement benefits described herein, COBRA rights, unemployment compensation
and worker's compensation. Employee warrants that he has not assigned or
transferred any right or claim described in this general release. Employee
expressly assumes all risk that the facts and law concerning this general
release may be other than as presently known to Employee, and acknowledges that,
in signing this general release, Employee is not relying on any information
provided by Releasees or upon Releasees to provide information not known to
Employee. Employee acknowledges that he has been advised to consult an attorney
regarding this release. This release shall be governed by and construed in
accordance with the laws of Colorado. In the event of any dispute under this
release, the prevailing party shall be entitled to recover all costs and
reasonable attorneys' fees incurred in connection therewith.
11. Binding Arbitration. Any controversy arising out of or relating to
this Agreement or any modification or extension of this Agreement, including any
claim for damages and/or rescission, shall be settled by binding arbitration in
Grand Junction, Colorado in accordance with the Commercial Arbitration rules of
the American Arbitration Association before a panel of one arbitrator. If the
parties to this agreement cannot agree on the choice of a single arbitrator,
then the panel shall consist of three arbitrators, one to be selected by the
Company, one to be selected by the Employee, and the third to be selected by the
other two arbitrators. The arbitrator(s) sitting in any such controversy shall
have no power to alter or modify any express provisions of the Agreement or to
render any award which by its terms effects any such alteration, or
modification. This section shall survive the termination of the Agreement.
12. Entire Agreement. This Agreement is the entire agreement between
the parties and supersedes all prior understandings or agreements with respect
to the matters referred to herein. This Agreement may not be altered or amended
except by a written agreement signed by the parties.
WHEREFORE, the parties have signed this Agreement on December 31, 1997,
to become effective January 1, 1998.
XXXXX OIL AND GAS COMPANY
By __________________________________
Xxxxxxx X. Xxxxx, Xx., President
EMPLOYEE:
-----------------------------------------
J. N. "Newt" Xxxxxxxxxx
WITNESSED:
By ______________________________________
Xxxxxxx X. Xxxxxx, Corporate Secretary
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EXHIBIT A
Option
Options Exercise Expiration
Outstanding Price Grant Date of Option
----------- ------- ------------ ----------
48,000 0.83 May 16, 1995 May 15, 2000
40,000 0.70 June 16, 1995 June 25, 2000
27,000 1.00 Xxxxx 0, 0000 Xxxxx 8, 2001
35,000 2.97 January 27, 1997 January 26, 2002
-------
150,000
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EXHIBIT B
Asset
Description Quantity Number Agreed
----------- -------- ------ ------
Compaq 486/33 Computer 1 10009 $ 400
Compaq SVGA Monitor 1 10047 150
Epson LQ-1070+Dot Matrix Printer 1 10062 100
1991 Ford F150 4WD SuperCab XLT lariat P/U
VIN #0XXXX00X0XXX00000 13001 3,500
Butcher Block Desk 1 20006 500
Butcher Block Credenza 1 20007 250
2 Drawer Wood File Cabinet 1 20014 100
2 Drawer Wood File Cabinet 1 20015 100
2 Drawer Wood File Cabinet 1 20016 100
2 Drawer Metal File Cabinet 1 20019 50
Butcher Block Credenza 1 20020 100
3 Drawer Lateral Wooden File Cabinet 1 20183 100
Office Chairs w/Purple Upholstery 2 NA 100
Reclining Office Chair 1 NA 100
Butcher Block Book Case 2 NA 100
Walnut Colored Wooden Book Case 1 NA 100
-----------
$ 5,850
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