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EXHIBIT 10.29
AGREEMENT
This Agreement (the "Agreement") is made and entered into this 5th day
of December, 2000, by and between North Coast Energy, Inc., a Delaware
corporation, (the "Company"), and Xxxxx Xxxxx ("Xxxxx").
RECITALS:
Xxxxx is the President of the Company and is directly responsible for
overseeing the sales and marketing activities associated with the Company's
annual formation of one or more drilling programs. In June 2000, Private
Placement Memorandums were distributed to interested broker-dealers in
connection with the private placement of up to $5,000,000 of units of
partnership interest in the North Coast Energy 2000 Appalachian Private Drilling
Program (the "2000 Drilling Program").
The Company's budget for fiscal year 2001 (which ends on March 31,
2001), anticipates that at least $3.5 million in the sale of units in the 2000
Drilling Program will be realized as a result of Xxxxx'x and the broker-dealer
network's efforts, although there is no certainty that such level of success
will be realized. Nevertheless, the Company is desirous of surpassing the amount
budgeted for in drilling program capital and the Company's management is
cognizant that there is now less than one month in which the funds can be raised
since the Private Placement Memorandum specifies a December 28, 2000, offering
termination date. In addition, the Company is cognizant that Xxxxx'x Restated
Employment Agreement with the Company will expire on May 2, 2001, and the
Company has advised Xxxxx that his contract will not be renewed. In view of the
short period of time remaining in Xxxxx'x term of employment, the Company's
management, as well as its Stock Option and Compensation Committee, have
reviewed various methods of providing Xxxxx with additional incentive to assist
in surpassing the Company's budget target and have concluded that it is in the
Company's best interests to incentivize Xxxxx on the commission basis
hereinafter set forth.
NOW, THEREFORE, in consideration of the agreements hereinafter set
forth and other good and valuable consideration, the adequacy of which is hereby
acknowledged, the parties hereby agree as follows:
1. EFFECTIVENESS OF AGREEMENT. This Agreement shall become
effective only upon the satisfaction of the following
conditions: (a) the approval of this Agreement by the Board of
Directors of the Company and (b) the execution and delivery of
this Agreement by all parties hereto.
2. OBLIGATION OF XXXXX. Xxxxx agrees to use his best efforts to
meet the Company's fiscal 2001 budgeted drilling funds
objective and to surpass that threshold of sales. A use of best
efforts shall not, however, be interpreted in such a manner as
would require Xxxxx to neglect the other responsibilities of
his office and no specific amount of sales shall be required to
establish Xxxxx' s performance hereunder.
3. PAYMENT OF COMMISSION. Subject to the provisions of Section 4
hereinbelow, the
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Company agrees to pay Xxxxx a commission of four percent (4%)
of the aggregate subscription amount received by the North
Coast Energy 2000 Appalachian Private Drilling Program,
determined as of December 28, 2000. This commission will not
be due and payable until May 2, 2001, the last day of the term
of Xxxxx'x Restated Employment Agreement with the Company. The
Company may, in its sole discretion, elect to make payment of
the accrued commission, without interest, in two equal
installments, one payable on May 2, 2001, and the second on
July 2, 2001, the first business day of the ensuing fiscal
quarter. Such election shall be made and communicated to Xxxxx
no later than April 20, 2001. Notwithstanding the date
prescribed for calculation of the commission, Xxxxx shall not
be entitled to commission on any subscriptions which are
subsequently refunded to the investor, for any reason
whatsoever, or on any monies invested by the Company or any of
its affiliates. If any of the units upon which a commission is
to be paid are, as of May 2, 2001, the subject of litigation
or threatened litigation in which a claim for rescission of
the original subscription is made, then the Company may
withhold payment of the commission attributable to such units
until such time as the litigation is resolved.
4. DISCRETION OF COMPANY IN EXERCISE OF GREENSHOE PROVISION. It
is acknowledged by the parties that the Private Placement
Memorandum contains a greenshoe provision which enables the
Company, in its sole discretion, to increase the maximum
aggregate subscriptions that may be accepted by the Company
from $5,000,000 to $6,000,000. Notwithstanding any other
provision of the Agreement, the Company shall have no
obligation to accept more than $5,000,000 in maximum aggregate
subscriptions for the 2000 Drilling Program and Xxxxx shall at
no time be entitled to or have a claim for any commission on
subscriptions accepted by the Company in excess of the maximum
aggregate amount of $5,000,000, it being agreed that only
those subscriptions up to and including an aggregate of
$5,000,000 shall be subject to the payment of a commission
hereunder.
5. NO GUARANTY OF CONTINUED EMPLOYMENT. Nothing contained in this
Agreement shall be so construed as to provide Xxxxx with a
guaranty of continued employment under all circumstances for
the remainder of his Restated Employment Agreement, it being
understood that the Company reserves its rights thereunder
with respect to the provisions concerning termination for
cause.
6. CONFIDENTIALITY. . Both Xxxxx and the Company agree to
maintain the confidentiality of this Agreement and not to
disclose its contents until such date as either party may be
required to make a disclosure to the Securities and Exchange
Commission, NASD or other governmental agency.
7. ADVICE OF COUNSEL. Each of the parties hereto acknowledges
that he/it has been advised that he/it has the right to
consult with and has consulted with an attorney of his/its own
choice prior to executing this Agreement and has a full
understanding of its terms and meaning.
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8. ENTIRE AGREEMENT. This Agreement represents the entire
agreement of the parties hereto with respect to the subject
matter hereof and supersedes all prior agreements and
understandings, whether in the form of past written agreements,
drafts of understanding or oral understandings; provided,
however, any other agreement executed contemporaneous with this
Agreement and dealing with subject matter other than the herein
described incentive commission plan shall remain in full force
and effect.
9. GOVERNING LAW. This Agreement shall be construed under and the
rights of the parties hereto shall be governed by the laws of
the State of Ohio without regard to the principles of conflict
of laws thereof. Any action brought by either party to this
Agreement arising out of or pertaining to the subject matter
of this Agreement shall be brought in the Court of Common
Pleas of Summit County, Ohio, or in the U.S. District Court
for the Northern District of Ohio. Both parties consent to and
waive any objection to venue and jurisdiction in either of the
foregoing courts, and do further hereby acknowledge any of the
aforementioned courts to be a proper forum.
10. COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original, and
all of which together shall constitute one and the same
Agreement. The signature of any party to any counterpart,
including any facsimile thereof, may be appended to any other
counterpart and when so appended shall constitute an original.
11. BINDING EFFECT. This Agreement shall inure to the benefit of
the parties, their respective heirs, successors and assigns.
Notwithstanding the foregoing provision, Xxxxx shall not be
permitted to delegate his responsibilities hereunder, and any
such attempt to delegate the best efforts obligation contained
in Section 2 hereof to another person or entity shall act as a
termination of the obligation of the Company to pay a
commission to Xxxxx on any units that may be sold after the
date of such attempted delegation.
12. NOTICES. All notices and other communications hereunder shall
be in writing and shall be deemed given if delivered
personally, or twenty-four (24) hours after being sent by
confirmed facsimile transmission, with subsequent mail
delivery, or three (3) days after being mailed (by registered
or certified mail, return receipt requested), in each case to
parties at the following addresses, or such other address for a
party as shall be specified by like notice:
a) If to Xxxxx:
0000 Xxxxxx Xxxxx
Xxxxx Xxxxx, Xxxx 00000
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With a copy to:
Xxxxx X. Xxxxxx, Xx., Esq.
Schneider, Smeltz, Xxxxxx & XxXxxx P.L.L.
Suite 1000
0000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000-0000
b) If to the Company:
North Coast Energy, Inc.
0000 Xxxx Xxxxxxx
Xxxxxxxxx, Xxxx 00000
Attn: General Counsel
IN WITNESS WHEREOF, the parties have represented to one another that
they have carefully read the foregoing terms of this Agreement, that they know
and understand the contents of this Agreement, that they have authority to
execute this Agreement, that they have undertaken to sign the same as their own
respective free act and deed, having declared their intention to be bound
contractually by all such terms and conditions, and do hereby execute and
deliver this Agreement this 5 day of December, 2000.
NORTH COAST ENERGY, INC.
By: /s/ Xxxx Xxxxx
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Xxxx Xxxxx
Chief Executive Officer
/s/ Xxxxx Xxxxx
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Xxxxx Xxxxx (Individually)
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