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EXHIBIT 10.28
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made and entered into as of the 10th day of
November, 2000 by and between DevX Energy, Inc., having its principal executive
offices at 00000 Xxxx Xxxx, Xxxxx 0000, Xxxxxx XX 00000-0000, and Xxxxxxx X.
Xxxxxxx having a mailing address at 0000 Xxxx Xxxxxx Xxxx, Xxxxxx, XX., 00000.
WHEREAS:
a. The Executive has extensive knowledge of and experience in the
oil and gas industry in the United States and the geographic
areas in which the Company and its subsidiaries carry on
business.
b. The Executive is desirous of being employed by the Company and
the Company is desirous of employing the Executive upon the
terms herein provided.
c. The Company has determined that it is in its best interests to
provide the Executive with compensation and benefits under the
provisions of a contract of employment that will assure the
Company that it will have the full attention and dedication of
the Executive notwithstanding the possibility, threat or
occurrence of a Change of Control (as defined below), and that
will diminish the inevitable distraction of the Executive by
virtue of the personal uncertainties and risks created by the
absence of a contract of employment.
d. The Company wishes to protect the Executive from loss of
compensation and benefits if his continued employment with the
Company is no longer possible through no fault of the
Executive.
NOW, THEREFORE, in consideration of these premises and the
mutual covenants herein contained, the Company and the Executive hereby agree as
follows:
1. DEFINITIONS. The capitalized terms defined in this Section shall have
the meanings assigned to them in this Section whether the particular
term is used herein in the singular or in the plural.
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1.1. "Affiliate" has the meaning set out in Rule 405 promulgated
under the Securities Act of 1933, as amended.
1.2. "Base Salary" has the meaning set in Schedule B as same may be
amended from time to time.
1.3. "Beneficial Ownership" has the meaning set out in Rule 13d-3
promulgated under the Securities Exchange Act of 1934, as
amended.
1.4. "Bonus" has the meaning set out in paragraph B of Schedule A
1.5. "Cause" means:
1.5.1. the willful and continued failure by the Executive to
substantially perform his duties with the Company
(other than any such failure resulting from
incapacity due to physical or mental illness), where
such failure has not been remedied within a
reasonable time after having received a written
demand for substantial performance from the Company
which specifically identified the manner in which the
Company believed that the Executive had not
substantially performed his duties, provided that no
act, or failure to act, on the Executive's part shall
be considered "willful" unless done, or omitted to be
done, by him not in good faith and without reasonable
belief that his action or omission was not in the
best interest of the Company, or
1.5.2. a good faith determination by the Company that the
Executive is guilty of illegal substance abuse, moral
turpitude, fraud upon the Company or embezzlement
provided that no determination of illegal substance
abuse or moral turpitude may be made against the
Executive without giving the Executive notice of the
allegations against him in reasonable detail and
giving him an opportunity to present, not less than
30 calendar days later, such evidence or make such
submissions in respect thereof to the Company as the
Executive deems advisable.
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1.5.3. the final, non-appealable felony conviction of the
Executive.
1.6. "Change of Control" means any of the following:
1.6.1. any consolidation or merger of the Company in which
the Company is not the continuing or surviving
corporation or pursuant to which shares of the
Company's common stock would be converted into cash,
securities or other property, other than a merger of
the Company in which the holders of the Company's
common stock immediately prior to the merger have the
same proportionate ownership of common stock of the
surviving corporation immediately after the merger;
1.6.2. any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of
all or substantially all of the assets of the
Company;
1.6.3. any approval by the stockholders of the Company of
any plan or proposal for the liquidation or
dissolution of the Company;
1.6.4. the cessation of control (by virtue of their not
constituting a majority of directors) of the
Company's Board of Directors by the Continuing
Directors.
1.6.5. (A) the acquisition of beneficial ownership of an
aggregate of 15% of the voting power of the Company's
outstanding voting securities by any person or group
who Beneficially Owned less than 10% of the voting
power of the Company's outstanding voting securities
on the Effective Date, (B) the acquisition of
Beneficial Ownership of an additional 5% of the
voting power of the Company's outstanding voting
securities by any person or group who Beneficially
Owned at least 10% of the voting power of the
Company's outstanding voting securities on the
Effective Date, or (C) the execution by the Company
and a stockholder of a contract that by its terms
grants such stockholder (in its, hers or his capacity
as a
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stockholder) or such stockholder's Affiliate
including, without limitation, such stockholder's
nominee to the Board of Directors (in its, hers or
his capacity as an Affiliate of such stockholder),
the right to veto or block decisions or actions of
the Board of Directors; provided, however, that
notwithstanding the foregoing, the events described
in items (A), (B) or (C) above shall not constitute a
Change in Control hereunder if the acquiring person
or group is (aa) a trustee or other fiduciary holding
securities under an employee benefit plan of the
Company and acting in such capacity, (bb) a
corporation owned, directly or indirectly, by the
stockholders of the Company in substantially the same
proportions as their ownership of voting securities
of the Company and, provided further, that none of
the following shall constitute a Change in Control:
(xx) the right of the holders of any voting
securities of the Company to vote as a class on any
matter or (yy) any vote required of disinterested or
unaffiliated directors or stockholders including,
without limitation, pursuant to Section 144 of the
Delaware General Corporation Law or Rule 16b-3
promulgated pursuant to the Securities Exchange Act
of 1934; or
1.6.6. subject to applicable law, in a Chapter 11 bankruptcy
proceeding, the appointment of a trustee or the
conversion of a case involving the Company to a case
under Chapter 7; and
1.6.7. notwithstanding anything in this Agreement to the
contrary, the transactions contemplated by the
Pre-Effective Amendment No. 1 to the Company's
Registration Statement on form S-2 filed with the
Securities & Exchange Commission on October 6, 2000
shall not be considered a change of control
hereunder.
1.7. "Continuing Directors" the individuals who were directors at
Effective Date or become directors thereafter but whose
election was approved by a vote of at least two-thirds of the
directors who were directors as of the Effective Date or whose
own election was previously so approved;
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1.8. "Company" means DevX Energy, Inc. a company incorporated under
the laws of the state of Nevada.
1.9. "Company Group" means the Company, DevX Energy, Inc., a
Delaware corporation, DevX Operating Co., Corrida Resources,
Inc., and any other entity that directly or indirectly
controls, is controlled by, or is under common control with
the Company or such one or more of the foregoing as the
context may require.
1.10. "Confidential Information" means all written, computer
readable or other tangible forms of information, documents,
memoranda, or other materials prepared by or on behalf of or
pertaining to the Company Group and the business, properties
and assets thereof including, without limitation, employee
lists, production reports, reserve reports, exploration
targets, work-over programs, capital expenditures, proposed or
planned acquisitions or divestments, performance reports,
plans, studies, projections, methods, designs, investigative
or production techniques at any time used, developed,
investigated, made or sold by or on behalf of the Company
Group (whether or not by the Executive), before or during the
term of this Agreement, that are maintained as confidential by
the Company Group or any part thereof but does not include
information that is readily available to the public or that
was known to the Executive prior to his becoming employed by
any member of the Company Group (provided that the onus to
establish that the information was not Confidential
Information as defined in this Agreement shall be on the
Executive).
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1.11. "Date of Termination" means the date on which the Company
notifies the Executive of such termination or the date on
which the Executive notifies the Company that he is
terminating the Agreement for Good Reason as the case may be,
provided that if the Executive's employment is terminated by
reason of death, the Date of Termination shall be the date of
death of the Executive and provided further that if a Change
of Control occurs within 30 days of the date on which the
Company notifies the Executive that his employment has been
terminated and the Executive can reasonably demonstrate that
such termination arose in the contemplation of a Change of
Control, then the Date of Termination shall be deemed to be
the day following the Change of Control.
1.12. "Disability" means a condition of ill health or physical or
mental incapacity, that, in the good faith opinion of the
Compensation Committee of the Company's Board of Directors,
and, notwithstanding the reasonable accommodations made by the
Company, renders the Executive materially unable or unwilling
to perform his duties under this Agreement, and for a period
of not less than 180 consecutive days, or for a cumulative
period of not less than 270 days within any 12-month period
irrespective of whether or not all or any such 270 days are
consecutive.
1.13. "Effective Date" means November 10, 2000.
1.14. "Employment Period" has the meaning specified in Section 4.
1.15. "Executive" means Xxxxxxx X. Xxxxxxx.
1.16. "Failure to Relocate" means a refusal by or the inability or
failure of the Executive to relocate his residence outside of
the Dallas area and thenceforth to carry out his regular,
full-time duties from such other location within 90 days of
being requested to do so by the Board of Directors as
contemplated by paragraph 3 hereof (other than any such
inability or failure during a period of incapacity due to
mental or physical illness). Provided that the Failure to
Relocate shall not be considered Cause or Good Reason for the
purposes of this Agreement.
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1.17. "Good Reason" means any of the following:
1.17.1. Without his express written consent, the assignment
to the Executive of any duties materially
inconsistent with his positions, duties,
responsibilities and status with the Company as of
the Effective Date, a substantial reduction in his
reporting responsibilities, titles or offices as of
the Effective Date as the same may be increased from
time to time, or any removal of the Executive from or
any failure to re-elect the Executive to any of such
positions, except as such removal or failure arises
in connection with the termination of his employment
for Cause, Disability or as a result of his death or
by the Executive other than for Good Reason;
1.17.2. A reduction by the Company in the Executive's Base
Salary as in effect at the time of the reduction;
1.17.3. The failure by the Company to continue in effect any
benefit or compensation plan (including but not
limited to any stock option plan, pension plan or,
health and accident plan) in which the Executive from
time to time participates (or plans providing
substantially similar benefits, and whether by or
through the Company or another member of the Company
Group), the taking of any action by the Company which
would adversely affect the Executive's participation
in or materially reduce his benefits under any of
such plans or deprive him of any material fringe
benefit enjoyed by him, or the failure by the Company
to provide the Executive with the number of paid
vacation days to which he is then entitled on the
basis of years of service with the Company in
accordance with the Company's normal vacation policy
in effect immediately prior to the Effective Date
except for such changes in benefits that affect all
executive officers of the Company and do not result
in a proportionately greater reduction in the rights
of or benefits to the Executive as compared with any
other executive officer of the Company;
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1.17.4. Any failure of the Company to obtain the assumption
of, or the agreement to perform, this Agreement by
any successor as contemplated in Section 14.1 hereof;
1.17.5. Any purported termination of the Executive's
employment by the Company which is not effected
pursuant to Section 6.7.1 hereof;
1.17.6. Neither the decision nor the notification by the
Company that it does not intend to extend the
Employment Period shall be considered to be Good
Reason provided that the decision not to extend was
taken in good faith.
1.18. "Notice of Termination" means a written notice which indicates
the specific termination provision in this Agreement relied
upon, and, to the extent applicable, sets forth in reasonable
detail the facts and circumstances claimed to provide a basis
for termination of the Executive's employment under the
provision so indicated.
1.19. "Option Plan" means the 1997 Incentive Equity Plan of the
Company as same may be amended or replaced from time to time.
1.20. "Target Bonus" has the meaning set out in Schedule B as same
may be amended from time to time.
2. EMPLOYMENT. Upon the terms and subject to the conditions contained in
this Agreement, the Executive agrees to provide full-time services for
the Company during the Employment Period. The Executive agrees to
devote his best efforts to the business of the Company, and shall
perform his duties in a diligent, trustworthy and business-like manner,
all for the purpose of advancing the business of the Company.
3. DUTIES. The Executive shall have the position and title of Chief
Financial Officer and shall have the duties customarily attendant to
that office and as may be more particularly set out in Schedule B
hereto. During the Employment Period, the Executive shall carry out his
duties at the Company's headquarters in Dallas Texas and his position
(including status, offices,
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titles and reporting requirements), authority, duties and
responsibilities shall be at least commensurate in all material
respects with the most significant of those set forth in Schedule B.
Notwithstanding anything in this Agreement to the contrary but subject
to Section 6.6, the Board of Directors may, upon 90 days notice,
require the Executive to relocate and thenceforth to carry out his
regular, full-time duties from such other location. During the
Employment Period, and excluding any periods of vacation and sick leave
to which the Executive is entitled, the Executive agrees to devote
reasonable attention and time during normal business hours to the
business and affairs of the Company and, to the extent necessary to
discharge the responsibilities assigned to the Executive hereunder, to
use the Executive's reasonable best efforts to perform faithfully and
efficiently such responsibilities. During the Employment Period it
shall not be a violation of this Agreement for the Executive to (A)
serve on corporate, civic or charitable boards or committees, (B)
deliver lectures, fulfill speaking engagements or teach at educational
institutions, and (C) manage personal investments, so long as such
activities do not create a conflict of interest with the Company's
affairs or significantly interfere with the performance of the
Executive's responsibilities as an employee of the Company in
accordance with this Agreement.
4. EMPLOYMENT PERIOD. The employment of the Executive by the Company as
provided in Paragraph 2 shall be for the period commencing on November
10, 2000 through and ending on the second anniversary of such date (the
"EMPLOYMENT PERIOD") unless earlier terminated pursuant to the
provisions of Section 6; provided, however, that beginning on the first
anniversary date of the Effective Date of this Agreement and on each
annual anniversary of such date (such date and each annual anniversary
thereof herein referred to as the "RESET DATE"), the Employment Period
shall be automatically extended so as to terminate two years after such
Reset Date, unless at least 60 days prior to the Reset Date the Company
shall give notice to the Executive that the Employment Period shall not
be so extended.
5. SALARY AND BENEFITS. The salary and benefits of the Executive hereunder
are as set forth on Schedules A & B attached hereto.
6. TERMINATION OF EMPLOYMENT. Subject to the terms of this Agreement, the
Company may terminate the employment of the Executive prior to the
expiration of the Employment Period at any time as it deems
appropriate.
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6.1. Termination Without Cause; Resignation for Good Reason. If during the
Employment Period, the Executive's employment is terminated by the
Company without Cause, or the Executive voluntarily terminates his
employment for Good Reason, the Company shall have no further
obligation to make any payment or extend any benefit to the Executive,
except that Company shall pay to the Executive, in a lump sum in cash
within 30 days after the Date of Termination, an amount equal to the
sum of:
6.1.1. one (1) year's Base Salary at the rate in effect immediately
prior to the termination;
6.1.2. If, at the Date of Termination, no bonus has been declared by
the Board as payable to the Executive in respect of the fiscal
year in which termination occurs, the Target Bonus established
for the Executive with respect to the year in which the
termination occurs, prorated to the Date of Termination;
6.1.3. any accrued but unpaid salary and bonuses; and
6.1.4. The cash equivalent of unvested options as required by Section
6.7.3 hereof.
6.2. Termination After a Change of Control. If, during the Employment
Period, the Executive's employment is terminated pursuant to Section
6.1 and the Date of Termination is within the twelve (12) month period
following a Change of Control, the Company shall pay to the Executive,
instead of the amounts provided in 6.1.1 and 6.1.2, an amount that is
equal to the sum of eighteen (18) month's Base Salary at the rate in
effect immediately prior to the termination plus the Target Bonus
established for the Executive with respect to the year in which
termination occurs.
6.3. Voluntary Resignation or Termination for Cause. If, during the
Employment Period, the Executive shall voluntarily terminate his
employment for other than Good Reason or if the Company shall discharge
the Executive for Cause, the Company shall have no further obligation
to make any payment or extend any benefit to the Executive except
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that the Company shall pay the Executive accrued but unpaid salary,
bonuses and benefits payable pursuant to Section 5 hereof through the
Date of Termination.
6.4. Termination for Disability. If, during the Employment Period, the
Company terminates this Agreement for Disability, the Company shall
have no further obligation to make any payment or extend any benefit to
the Executive except that the Company shall pay to the Executive, or
his legal representative as the case may be, all accrued but unpaid
salary and bonuses, if any, provided that if at the Date of Termination
for Disability, no bonus has been declared by the Board as payable to
the Executive in respect of the fiscal year in which such termination
occurs, the Company shall pay the Target Bonus established for the
Executive with respect to such year, prorated to the Date of
Termination.
6.5. Death of the Executive. If the Executive dies prior to the end of
Employment Period, the Executive's employment and other obligations
under this Agreement shall automatically terminate and the Company
shall have no further obligation to make any payment or extend any
benefit to the Executive as of the end of the month in which the
Executive's death occurs; provided that the Company shall pay to the
Executive's estate, as soon as practicable, all accrued and unpaid
salary and bonuses, if any, provided further that, if no bonus has been
declared for the year in which death occurred, the Company shall pay
the Target Bonus established for the Executive in respect of such year
prorated to the Date of Termination.
6.6. Failure to Relocate. If the Executive's employment is terminated by the
Company for Failure to Relocate during the Employment Period, the
Company shall pay to the Executive in a lump sum in cash within 30 days
of the Notice of Termination, the aggregate of the amounts the would
have been payable to the Executive under this Section 6 if such
Termination had been effected by the Company Without Cause.
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6.7. General Termination Provisions.
6.7.1. Notice of Termination Any termination by the Company or by the
Executive shall be communicated by Notice of Termination to
the other party thereto given in accordance with Section 14.3
hereof. The failure by the Executive or the Company to set
forth in the Notice of Termination any fact or circumstance
which contributes to a showing of Good Reason, Cause or
Disability shall not render the Notice of Termination
ineffective or waive any right of the Executive or the Company
hereunder or preclude the Executive or the Company from
asserting such fact or circumstance in enforcing the
Executive's or the Company's rights hereunder.
6.7.2. Employee Benefits Payable on Termination. Except in the case
where the Executive's employment is terminated for Cause or
the Employee voluntarily terminates his employment for other
than Good Reason and notwithstanding anything in this
Agreement to the contrary, the Company shall maintain in full
force and effect to the end of the two year period commencing
on the Reset Date immediately preceding the Date of
Termination, for the continued benefit of the Executive and,
if applicable, the Executive's spouse and children, the
employee benefits set forth in Item H of Schedule A attached
hereto that he was entitled to receive immediately prior to
the Date of Termination (subject to the general terms and
conditions applicable at such time and from time to time of
the plans and programs under which he receives such benefits).
6.7.3. Stock Options Except in the case where the Executive's
employment is terminated for Cause or the Executive
voluntarily terminates his employment for other than Good
Reason and notwithstanding anything in this Agreement to the
contrary, any unvested stock options previously issued to the
Executive shall become vested in the Executive, or his estate
as the case may be, immediately upon receipt of a Notice of
Termination provided that, if the Option Plan under which the
options were granted prohibits such immediate vesting, the
Company shall pay the cash equivalent of the aggregate
positive spread between the
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exercise price of all such unvested options and the highest
closing price of the Company's common stock during the 10
trading days preceding the Termination Date.
6.7.4. Mitigation of Amounts Payable Hereunder. The Executive shall
not be required to mitigate the amount of any payment provided
for in this Section 6 by seeking other employment or
otherwise, nor shall the amount of any payment provided for in
this Section 6 be reduced by any compensation earned by the
Executive as the result of employment by another employer
after the Date of Termination, or otherwise.
6.7.5. Complete Payment. The payments and other benefits to be made
or to be extended to the Executive under the provisions of
this Section 6 upon termination of the Executive's employment
shall be in complete satisfaction of any and all payments that
would otherwise be due to the Executive had he remained
employed by the Company during the remainder of the Employment
Period and the Company shall have no further obligation to
make any payment or extend any benefit to the Executive under
Sections 4, 5 and 6 of this Agreement or otherwise upon or
after such termination other than as provided in this Section
6.
7. INDEMNITY. The Company shall indemnify, to the full extent authorized
by law, the Executive and his heirs, executives, administrators and
legal representatives, from any and all suits, claims, actions, demands
or proceedings of any kind to which the Executive is named or in
respect of which he may be or become liable by reason of the fact that
he is or was a director, officer or employee of any member of the
Company Group or by reason of the fact that he is or was, at the
Company's request, serving as the representative of the Company or any
member of the Company Group on any other corporation, trust, joint
venture or enterprise not part of the Company Group.
8. CONFIDENTIAL INFORMATION. The Executive recognizes and acknowledges
that he requires access to Confidential Information to perform his
duties hereunder and such information constitutes valuable, special and
unique property of the Company Group. The Company
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agrees to provide Confidential Information immediately upon the
execution of this Agreement and thereafter at such time or times as are
or may become required by the needs of the position of the Executive
and his responsibilities within the Company. The Executive agrees that
he shall not at any time, either during or subsequent to the term of
this Agreement, disclose to others, use, copy or permit to be copied,
except in pursuance of his duties for and on behalf of the Company, its
successors, assigns or nominees, any Confidential Information of any
member of the Company Group (regardless of whether developed by the
Executive) without the prior written consent of the Company, provided
however, that this provision shall not prohibit the Executive from
disclosing Confidential Information in compliance with a court order.
9. DELIVERY OF DOCUMENTS UPON TERMINATION. The Executive shall deliver to
the Company or its designee at the termination of his employment all
correspondence, memoranda, notes, records, drawings, sketches, plans,
customer lists, product compositions, and other documents and all
copies thereof, made, composed or received by the Executive, solely or
jointly with others, that are in the Executive's possession, custody,
or control at termination and that are related in any manner to the
past, present, or anticipated business of any member of the Company
Group, except for items owned by the Executive at the Effective Date.
In this regard, the Executive hereby grants and conveys to the Company
all right, title and interest in and to, including without limitation,
the right to possess, print, copy, and sell or otherwise dispose of,
any reports, records, papers, summaries, photographs, drawings or other
documents, and writings, and copies, abstracts or summaries thereof,
that may be prepared by the Executive or under his direction or that
may come into his possession in any way during the term of his
employment with the Company that relate in any manner to the past,
present or anticipated business of any member of the Company Group.
10. FURTHER ACTS. At the request of the Company (but without additional
compensation from the Company during his employment by the Company) the
Executive shall execute any and all papers and perform all lawful acts
that the Company may deem necessary or appropriate to further evidence
or carry out the transactions contemplated in this Agreement including,
without limitation, such acts as may be necessary for the preparation,
filing, prosecution, and maintenance of applications for United States
letters patent and foreign letters patent, or for
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United States and foreign copyright, with respect to any inventions,
works or other matters prepared or authored by the Executive in the
course of his employment.
11. NO COMPETITION. In consideration for being given access to Confidential
Information by the Company upon the execution of this agreement the
Executive acknowledges and agrees that:
11.1. He shall not directly or indirectly engage in the business of
acquiring oil and natural gas reserves and oil and natural gas
production and exploitation; or any other business in which
any member of the Company Group directly or indirectly engages
during the Employment Period. This provision shall apply
during the Employment Period and through the first anniversary
of the expiration thereof, provided, however, that the
restriction in this Section 11 shall apply only to the
reasonable and limited geographic area in which any member of
the Company Group directly or indirectly has material
operations as of the Date of Termination or expiration of this
Agreement whichever comes first. For purposes of this Section
11, the Executive shall be deemed to engage in a business if
he directly or indirectly, engages or invests in, owns,
manages, operates, controls or participates in the ownership,
management, operation or control of, is employed by,
associated or in any manner connected with, or renders
services or advice to, any business engaged in acquiring oil
and natural gas reserves and oil and natural gas production
and exploitation; provided, however, that the Executive may
invest in the securities of any enterprise (but without
otherwise participating in the activities of such enterprise)
if (x) such securities are listed on any national or regional
securities exchange or have been registered under Section
12(g) of the Securities Exchange Act of 1934 and (y) the
Executive does not have Beneficial Ownership of more than 5%
of the outstanding capital stock of such enterprise;
11.2. If a court of competent jurisdiction determines that the
length of time or any other restriction, or portion thereof,
set forth in this Section 11 is overly restrictive and
unenforceable, the court may reduce or modify such
restrictions to those which it deems reasonable and
enforceable under the circumstances, and as so reduced or
modified, the parties hereto agree that the restrictions of
this Section 11 shall remain in full force and effect. The
Executive further agrees that if a court of competent
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jurisdiction determines that any provision of this Section 11
is invalid or against public policy, the remaining provisions
of this Section 11 and the remainder of this Agreement shall
not be affected thereby, and shall remain in full force and
effect.
11.3. The geographic area in which the Company Group does business
is the continental United States in scope and that the
restrictions imposed by this Agreement are legitimate,
reasonable and necessary to protect the investment of the
Company Group in its business and the goodwill associated
therewith. The Executive acknowledges that the scope and
duration of the restrictions contained herein are reasonable
in light of the time that the Executive has been engaged in
the oil and gas industry, his reputation therein and his
relationship with the suppliers, customers and clients of the
Company Group. The Executive further acknowledges that the
restrictions contained herein are not burdensome to the
Executive in light of the consideration paid therefor and the
other opportunities that remain open to the Executive.
Moreover, the Executive acknowledges that he has other means
or opportunities available to him for the pursuit of his
profession or livelihood that will not be impaired by this
Section 11.
12. REMEDIES. The Executive acknowledges that a remedy at law for any
breach or attempted breach of the Executive's obligations under
Sections 8 through 11 hereof may be inadequate, and he agrees that the
Company may be entitled to specific performance and injunctive and
other equitable remedies in case of any such breach or attempted
breach, and further agrees to waive any requirement for the securing or
posting of any bond in connection with the obtaining of any such
injunctive or other equitable relief. The Company shall have the right
to offset against amounts to be paid to the Executive pursuant to the
terms hereof any amounts from time to time owing by the Executive to
the Company. The termination of the Agreement pursuant to Section 4, ,
6.3 or 6.4 hereof shall not be deemed to be a waiver by the Company of
any breach by the Executive of this Agreement or any other obligation
owed the Company, and notwithstanding such a termination the Executive
shall be liable for all damages attributable to such a breach.
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13. DISPUTE RESOLUTION. Subject to the Company's right to seek injunctive
relief in court as provided in Section 12 hereof, any dispute,
controversy or claim arising out of or in relation to or connection to
this Agreement, including without limitation any dispute as to the
construction, validity, interpretation, enforceability or breach of
this Agreement, shall be exclusively and finally settled by
arbitration, and any party may submit such dispute, controversy or
claim, including a claim for indemnification under this Section 13, to
arbitration.
13.1. Selection of Arbitrators. The arbitration shall be heard and
determined by one arbitrator, who shall be impartial and who
shall be selected by mutual agreement of the parties. If the
parties cannot agree on the sole arbitrator, then the
appointing authority for the implementation of such procedure
shall be the Senior United States District Judge for the
Northern District of Texas, who shall appoint an independent
arbitrator who does not have any financial interest in the
dispute, controversy or claim. If the Senior United States
District Judge for the Northern District of Texas refuses or
fails to act as the appointing authority within ninety (90)
days after being requested to do so, then the appointing
authority shall be the Chief Executive Officer of the American
Arbitration Association, who shall appoint an independent
arbitrator who does not have any financial interest in the
dispute, controversy or claim. All decisions and awards by the
arbitration tribunal shall be made by majority vote.
13.2. Proceedings. Unless otherwise expressly agreed in writing by
the parties to the arbitration proceedings:
13.2.1. The arbitration proceedings shall be held in Dallas,
Texas, at a site chosen by mutual agreement of the
parties, or if the parties cannot reach agreement on
a location within thirty (30) days of the appointment
of the last arbitrator, then at a site chosen by the
arbitrators;
13.2.2. The arbitrators shall be and remain at all times
wholly independent and impartial;
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13.2.3. The arbitration proceedings shall be conducted in
accordance with the Commercial Arbitration Rules of
the American Arbitration Association, as amended from
time to time;
13.2.4. Any procedural issues not determined under the
arbitral rules selected pursuant to item 13.2.3 above
shall be determined by the law of the place of
arbitration, other than those laws which would refer
the matter to another jurisdiction;
13.2.5. The decision of the arbitrators shall be: reduced to
writing; final and binding without the right of
appeal; the sole and exclusive remedy regarding any
claims, counterclaims, issues or accounting presented
to the arbitrators; made and promptly paid in United
States dollars free of any deduction or offset other
than as provided in Section 14.11; and any costs or
fees incident to enforcing the award shall, to the
maximum extent permitted by law, be charged against
the party resisting such enforcement;
13.2.6. The award shall include interest from the date of any
breach or violation of this Agreement, as determined
by the arbitral award, and from the date of the award
until paid in full, at the applicable Federal rate
provided for in Section 7872(f)(2)(A) of the Code;
and
13.2.7. Judgment upon the award may be entered in any court
having jurisdiction over the person or the assets of
the party owing the judgment or application may be
made to such court for a judicial acceptance of the
award and an order of enforcement, as the case may
be.
13.3. Acknowledgment Of Parties. Each party acknowledges that by
executing this Agreement he or it has voluntarily and
knowingly entered into an agreement to arbitrate under this
Section.
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14. MISCELLANEOUS PROVISIONS.
14.1. Successors of the Company. The Company will require any
successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the
business and/or assets of the Company, by agreement in form
and substance satisfactory to the Executive, expressly to
assume and agree to perform this Agreement in the same manner
and to the same extent that the Company would be required to
perform it if no such succession had taken place. Failure of
the Company to obtain such agreement prior to the
effectiveness of any such succession shall be a breach of this
Agreement and shall entitle the Executive to compensation from
the Company in the same amount and on the same terms as the
Executive would be entitled to under this Agreement had the
Executive terminated his employment for Good Reason, except
that for purposes of implementing the foregoing, the date on
which any such succession becomes effective shall be deemed
the Date of Termination. As used in this Agreement, "COMPANY"
shall mean the Company as hereinbefore defined and any
successor to its business and/or assets as aforesaid which
executes and delivers the agreement provided for in this
Section 14.1 or which otherwise becomes bound by all the terms
and provisions of this Agreement by operation of law.
14.2. Executive's Heirs, etc. The Executive may not assign his
rights or delegate his duties or obligations hereunder without
the written consent of the Company. This Agreement shall inure
to the benefit of and be enforceable by the Executive's
personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If the
Executive should die while any amounts would still be payable
to him hereunder as if he had continued to live, all such
amounts, unless otherwise provided herein, shall be paid in
accordance with the terms of this Agreement to his designee
or, if there be no such designee, to his estate.
14.3. Notice. For the purposes of this Agreement, notices and all
other communications provide for in the Agreement shall be in
writing and shall be deemed to have been duly given when
delivered or mailed by United States registered or certified
mail,
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return receipt requested, postage prepaid, addressed to the
respective addresses set forth on the first page of this
Agreement, provided that all notices to the Company shall be
directed to the attention of the Chief Executive Officer of
the Company with a copy to the Secretary of the Company, or to
such other place in respect of which a party has delivered a
written notice of change of address in accordance herewith,
except that notices of change of address shall be effective
only upon receipt.
14.4. Amendment; Waiver. No provisions of this Agreement may be
modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing signed by
the Executive and such officer as may be specifically
designated by the Board of Directors of the Company. No waiver
by either party hereto at any time of any breach by the other
party hereto of, or compliance with, any condition or
provision of this Agreement to be performed by such other
party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or
subsequent time. No agreements or representations, oral or
otherwise, express or implied, with respect to the subject
matter hereof have been made by either party which are not set
forth expressly in this Agreement.
14.5. Invalid Provisions. Should any portion of this Agreement be
adjudged or held to be invalid, unenforceable or void, such
holding shall not have the effect of invalidating or voiding
the remainder of this Agreement and the parties hereby agree
that the portion so held invalid, unenforceable or void shall,
if possible, be deemed amended or reduced in scope, or
otherwise be stricken from this Agreement to the extent
required for the purposes of validity and enforcement thereof.
14.6. Survival of the Executive's Obligations. Regardless of whether
the Executive's employment by the Company is terminated,
voluntarily or involuntarily, by the Company or the Executive,
with or without Cause, the Executive's fiduciary obligations
arising as a consequence of his employment and, without
limiting the generality of the foregoing, the provisions of
Sections 8 through 11 of this Agreement shall survive the
termination of this Agreement.
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14.7. 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
instrument.
14.8. Governing Law. This Agreement shall be governed by and
construed under the laws of the State of Texas.
14.9. Captions and Gender. The use of captions and Section headings
herein is for purposes of convenience only and shall not
effect the interpretation or substance of any provisions
contained herein. Similarly, the use of the masculine gender
with respect to pronouns in this Agreement is for purposes of
convenience and includes either sex who may be a signatory.
14.10. Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto with respect to the
subject matter hereof and supersedes all prior agreements,
both written and oral, between the parties with respect to the
subject matter hereof including the employment agreement dated
as of July 1, 1998. Without limiting the generality of the
foregoing, the Executive acknowledges that the employment
agreement dated July 1, 1998 has been terminated and is no
longer of any force or effect.
14.11. Legal Costs; Payments During Dispute. The Company shall pay
promptly as incurred, to the full extent permitted by law but
subject always to a maximum of $25,000, all legal fees and
out-of-pocket expenses which the Executive may reasonably
incur as a result of any contest by the Company, the Executive
or his estate or legal representative, of the validity or
enforceability of, or liability under, any provision of this
Agreement or any guarantee of performance thereof (including
as a result of any contest by the Executive about the amount
of any payment pursuant to this Agreement), plus in each case
interest on any delayed payment at the applicable Federal rate
provided for in Section 7872(f)(2)(A) of the Code. It is
further agreed that in the event that the Executive or his
legal representative is found by the board of arbitration,
court or other body adjudicating
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the contest to be entitled to less than the amount of relief
originally claimed by the Executive, the Executive shall
reimburse the Company for the amount of legal fees and
expenses incurred by the Company hereunder on behalf of the
Executive in proportion to the extent of such shortfall and
the Company may deduct such amount from any amount otherwise
payable to the Executive or his legal representative.
IN WITNESS WHEREOF, the parties hereto have signed this Agreement as of
the date first set forth above.
DEVX ENERGY, INC.
By: /s/ Xxxxxx X. Xxxxxx
-----------------------
Name: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
(EXECUTIVE)
/s/ Xxxxxxx X. Xxxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxxx
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SCHEDULE A
SALARY AND BENEFITS
A. Base Salary. The Company shall pay the Executive during the Employment
Period the Base Salary as set out in Schedule B as same may be
increased from time to time. The Base Salary shall be paid by the
Company in accordance with its regular payroll practices. The Company
may not reduce the Executive's Base Salary at any time during the
Employment Period.
B. Bonus. The Company may, in its sole discretion, pay to the Executive an
annual cash bonus (the "ANNUAL BONUS") of between 0% and 200% of the
Executive's Target Bonus as set out in Schedule B as same may be
amended from time to time. For greater certainty, it is expressly
understood and agreed that the Company may, in its absolute discretion,
determine that the Annual Bonus to be paid to the Executive in any
particular fiscal year may be zero or otherwise less than, equal to or
in excess of the Target Bonus established for such year. Any Annual
Bonus that is declared but not paid by the last business day of the
third month following the fiscal year end in respect of which the bonus
was declared shall bear interest thereafter until paid at the greater
of the Prime Rate then in effect or the highest rate then applicable
under any lending agreement to which the Company is then a party.
C. Annual Review. The Board's Compensation Committee of the Board of
Directors of the Company shall review the Base Salary and Target Bonus
annually on or before the start of each fiscal year during the
Employment Period and may amend same in accordance with this agreement
as the Committee deems appropriate.
D. Stock Options. The Company, may in its sole discretion, grant the
Executive such stock options pursuant to the Company's 1997 Incentive
Equity Plan (the "PLAN") as determined by the Compensation Committee of
the Company's Board of Directors. All such Stock Options shall be
subject to the terms and conditions of the Plan.
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E. Directors' and Officers' Insurance. The Executive shall be entitled to
the benefit of such directors and officers insurance coverage as the
Company may put in place from time to time during the Employment
Period.
F. Payment and Reimbursement of Expenses. During the Employment Period,
the Company shall pay or reimburse the Executive for all reasonable
travel and other expenses incurred by the Executive in performing his
obligations under this Agreement in accordance with the policies and
procedures of the Company for its senior executive officers, provided
that the Executive properly accounts therefor in accordance with the
regular policies of the Company.
G. Office Space. The Company shall, at its expense, provide an office for
the Executive at the headquarters of the Company. The Company shall
furnish and equip the Executive's office in accordance with the
standards commensurate with a position similar to that of the Executive
in a corporation of equivalent size located in the same area and
engaged in the same type of business as that of the Company.
H. Fringe Benefits and Perquisites. During the Employment Period, the
Executive shall be entitled to participate in or receive the Benefits
as set out in Schedule B and under any other plan or arrangement made
available by the Company to its senior executive officers including
medical, dental and disability insurance, 401K plans and other benefit
plans as and when established by the Company, subject to and on a basis
consistent with the terms, conditions and overall administration of
such plans and arrangements. Nothing paid to the Executive under any
plan or arrangement made available to the Executive shall be deemed to
be in lieu of compensation hereunder. Nothing herein shall obligate the
Company to establish any such plan or arrangement not expressly
required in Schedule B.
I. Tax. The Company may deduct and withhold from any compensation,
benefits, or amounts payable under this Agreement all federal, state,
city, or other taxes as may be required pursuant to any law or
governmental regulation or ruling.
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Schedule B
to the Employment Agreement dated November 10, 2000
Between DevX Energy, Inc. (the "Company")
and Xxxxxxx X. Xxxxxxx (the "Executive")
Base Salary: $145,000 per annum
Target Bonus: 35% of Base Salary
Duties and Responsibilities: The Executive shall direct and oversee all
financial and accounting aspects of the
Company's operations including developing
and maintaining banking and public market
relationships, preparation and presentation
of financial data to senior management or
outside parties as and when required,
working with and supporting the efforts of
our external auditors in the preparation of
the audit and other matters as required,
supervising the preparation of periodic and
other filings, such as Forms 10-Q and 10-K,
to the SEC and other regulatory agencies,
supervising all accounting support personnel
and otherwise take an active role, as a
member of senior management of the Company
in all major corporate decisions;
Reporting Relationships: the Chief Executive Officer or equivalent.
Benefits:
A. Vacation During the Employment Term, the Executive shall be
entitled to paid vacation and such other paid
absences, whether for holidays, illness,
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personal time, or any similar purposes, as determined
by the Company from time to time provided that the
amount of paid vacation shall not be less than three
(3) weeks (or fifteen (15) business days) during any
12 month period.
B. Sick Leave During any period of illness, the Company shall
continue to pay the Base Salary to the Executive
until such time as the illness constitutes a
Disability as defined in the Agreement.
C. Vehicle Allowance $450 per month.
D. Professional dues The Company shall pay the Executive's annual
membership fees as approved from time to
time by the Chief Executive Officer.
