EMPLOYMENT AGREEMENT
THIS
AGREEMENT, made
and
entered into on November 9, 2007 by and between Osage Exploration and
Development, Inc., a Delaware corporation (the "Company") and Xxxx Xxxxxxxx
(the
"Executive").
WHEREAS,
the Company desires that the Executive become employed by the Company and
provide services to the Company in the best interest of the Company and its
affiliates and constituencies;
WHEREAS,
the Executive desires to be employed by the Company as provided herein;
and
WHEREAS,
the Executive and the Company desire to enter into this Agreement to set forth
the terms and conditions of the Executive's services with the
Company;
NOW,
THEREFORE, in consideration of the premises and mutual covenants contained
herein and for other good and valuable consideration, the receipt of which
is
mutually acknowledged, the Company and the Executive (individually a "Party"
and
together the "Parties") agree as follows:
1. Employment.
The
Company hereby agrees to employ the Executive, and the Executive hereby agree
to
be employed with the Company on the terms and subject to the conditions set
herein.
2. Terms
of Employment.
The
term of the Executive's employment under this Agreement (the "Employment
Period") shall commence as of the date of this Agreement, and shall end on
November 30, 2009, unless extended or terminated earlier in accordance with
Section 5.
3. Position,
Duties and Responsibilities.
The
Executive shall be employed
by the Company and shall serve as Chief Geologist. The Executive shall have
all
authority commensurate with the position of Chief Geologist and shall report
directly to the Chief Executive Officer. The Executive shall not, without the
prior written approval of the Board, engage in any other business activity
which
is in violation of policies established from time to time by the Company or
its
affiliates.
a. Anything
herein to the contrary notwithstanding, nothing shall preclude the Executive
from serving on the boards of directors of a reasonable number of other
corporations or the boards of a reasonable number of trade associations,
provided that such activities do not materially interfere with the proper
performance of his duties and responsibilities as an executive officer of the
Company.
b. The
Executive shall perform his services hereunder primarily at the Company's
Oklahoma City, OK office.
4. Compensation.
a. Base
Salary. During
the Employment Period, the Executive shall receive a minimum annual salary
("Annual Base Salary") equal to $120,000, payable in accordance with the
customary payroll as in effect from time to time for senior executives of the
Company. The Board, from time to time, shall review the Executive's Annual
Base Salary for possible increases of such Base Salary in relationship to the
goals and performance of the Company, prevailing competitive conditions annually
and significant milestones achieved by the Company. The Annual Base Salary,
including any increases, shall not be decreased during the Employment Period.
b. Bonus.
Any
bonuses will be given at the discretion of the Board of Directors.
c. Restricted
Stock Grants.
2,000,000. To the extent Executive receives restricted stock in the Company,
the
stock will accelerate vesting in order to become fully vested upon Executive’s
termination of his employment for a Change of Control, upon termination of
his
employment for Good Reason or upon termination of his employment by the Company
without Cause (as defined below). The Restricted Stock Grants are issued
pursuant to a Restricted Stock Agreement entered into in conjunction with this
Agreement.
d. Vacation.
During
Employment Period, the Executive shall be entitled to 4 weeks of vacation per
year.
e. Expenses.
During
the Employment Period, the Executive shall be entitled to receive prompt
reimbursement for all reasonable business-related expenses incurred by the
Executive in accordance with the policies and procedures of the company as
applicable to its senior executives.
f. Other
Executive Benefits.
During
the Employment Period, the Executive shall be entitled to participate in or
be
covered under all compensation, bonus, pension, retirement, and welfare and
fringe benefit plans, programs and policies of the Company applicable to senior
executives of the Company.
5. Termination.
a. Death
or Disability.
The
Executive’s employment pursuant to this Agreement shall terminate automatically
upon the Executive's death. The Company may terminate the Executive's
employment for Disability by giving the Executive notice of its intention in
accordance with Section 5(e) unless Executive returns to the performance of
the
essential functions of his employment within 30 days after receipt of such
notice. For purposes of this Agreement, "Disability" means any
physical or mental condition that renders the Executive unable to perform the
essential functions of his employment for 90 consecutive days or for a total
of
180 days in any 360 consecutive days.
b. Voluntary
Termination after Change in Control.
Notwithstanding anything in this Agreement to the contrary, the Executive may
voluntarily terminate his employment at any time, after a Change in Control,
(i)
for any reason upon three months' written notice to the Company, or (ii) if
termination is for Good Reason or on account of the Executive's serious illness,
upon written notice pursuant to Section 5(e) but without any notice period.
Upon termination in conjunction with a Change of Control, the Executive
shall receive, in one payment, the greater of (i) Annual Base Salary in effect
immediately prior to the Change of Control and (ii) the remaining Annual Base
Salary in effect immediately prior to the Change of Control owed to Executive
until the end of the Employment period. In the event of any termination pursuant
to this Section 5(b), the executive shall have no further obligation to the
Company under this Agreement, except as provided in Section 6.
c. Cause.
The
Company may terminate the Executive's employment for Cause. For purposes
of this agreement "Cause" means: Executive's engaging in gross misconduct
materially and demonstrably injurious to the Company; failure to perform the
services hereunder; violation of any written resolution adopted by the Company's
Board of Directors or Executive Committee; or conviction by final judgement
of a
felony constituting fraud, theft, embezzlement or homicide.
d. Good
Reason.
The
Executive may terminate his employment for Good Reason. For purposes of
this Agreement, "Good Reason" means (i) a material reduction in the nature
or
scope of the Executive's position, title, status, authority, duties, powers,
or
functions on the date of this Agreement; (ii) the assignment to the Executive
of
any material duties which are not commensurate with or at least as prestigious
as the Executive's duties and responsibilities as contemplated by this
Agreement; (iii) a material breach by the Company of any of the provisions
of
this Agreement; (iv) the relocation of the Company's principal operations office
to a location outside Oklahoma City Area; or (v) the failure by the Company
to
obtain an agreement, reasonably satisfactory to the Executive, from any
successor to assume and agree to perform this Agreement. After a Change in
Control, in addition to items (i) through (v), "Good Reason" shall include
(vi)
a determination by the Executive, in his sole discretion, during the 30-day
period commencing 180 days following Change in Control he can no longer
effectively perform his duties.
e. Notice
of Termination.
Any
termination by the Company for Cause or Disability or by the Executive for
Good
Reason shall be communicated by a written notice (a "Notice of Termination")
to
the other party hereto. A "Notice of Termination" shall set forth in
reasonable detail the events giving rise to such termination.
f. Date
of Termination.
For
purposes of this Agreement, the term "Date of Termination" means (i) in the
case
of termination for Disability, 30 days after Notice of Termination is given
(provided that the Executive shall have not returned to full-time performance
of
his duties during such 30 day period); (ii) in the case of termination for
Cause, a date specified in the Notice of Termination (which shall not be more
than 30 days from the date such Notice of Termination is given); (iii) in the
case of any other termination for which a Notice of Termination is required,
the
date of receipt of such Notice of Termination or, if later, the date specified
therein, as the case may be; and (iv) in all other cases, the actual date on
which the Executive's employment terminates during the Employment
Period.
6. Noncompetition.
a. Scope.
In the
case of the Executive’s termination of employment, including due to the
expiration of the Employment Period, the Executive shall not, for one year
following the Date of Termination, without prior written approval of the
Company, (i) divert any active project of the Company (the “Designated Project”)
to a competitor of the Company or (ii) solicit or encourage any officer,
Employee or consultant of the Company to leave their employ for employment
by or
with any competitor of the Company for employment on the Designated Project.
If, at any time the provisions of this Section 6 shall be determined to be
invalid or unenforceable, by reason of being vague or unreasonable as to
area, duration or scope of activity, this Section 6 shall be
considered divisible and shall become and be immediately amended to apply only
to such area, duration and scope of activity as shall be determined to be
reasonable and enforceable by the court or other body having jurisdiction over
the matter; and the Executive agrees that this Section 6 as so amended shall
be
valid and binding as though any invalid or unenforceable provision had not
been
included herein. Nothing in this section 6 shall prevent or restrict the
Executive from engaging in any business or industry other than the Designated
Party in any capacity.
b. Irreparable
Harm.
The
Executive agrees that any remedy at law for any breach of this section 6 shall
be inadequate and that the Company shall be entitled to injunctive
relief.
7. Successors.
a. This
Agreement is personal to the Executive and, without written consent of the
Company, shall not be assignable by the Executive otherwise than by will or
the
laws of descent and distribution. This Agreement shall insure the benefit
of and be enforceable by the Executive’s legal representatives.
b. This
Agreement shall insure to the benefit of and be binding upon Company and its
successors. The Company shall require any successor to all or
substantially all of the business and/or assets of the Company, whether direct
or indirect, by an agreement in form and substance reasonably satisfactory
to
the Executive, expressly to assume and agree to perform this
Agreement.
8. Miscellaneous
a. Witholding.
Any payments provided for hereunder shall be paid net of any applicable
withholding required under federal, state or local law and any additional
withholding to which the Executive has agreed.
b. Applicable
law. This Agreement shall be governed by and construed in accordance with the
laws of California, applied without reference to principles of conflict of
laws.
c. Amendments.
This Agreement may not be amended or modified otherwise than by a written
agreement executed by the parties hereto or their respective successors and
legal representatives.
d. Notices.
All notices and other communications hereunder shall be in writing and shall
be
deemed to have been duly given and delivered or mailed to the other party by
registered or certified mail, return receipt requested, postage paid, addressed
as follows:
If
to the
Company: Osage
Exploration and Development, Inc.
000
Xxxxxxxx Xxxxxx, Xxxxx 000
Xx
Xxxxx,
XX 00000
Attention:
Xxx Xxxxxxxx
President
and Chief Executive Officer
If
to the
Executive: Xxxx
Xxxxxxxx
Or
to
such other address as either party shall have furnished to the other in writing
in accordance herewith, except that notice of change of address shall be
effective only when actually received by the addressee.
e. Severability.
The invalidity or unenforceability of any provision of this Agreement shall
not
affect the validity or enforceability of any other provision of this
agreement.
f. Waiver.
Waiver by any party hereto of any breach or default by any other party of any
of
the terms of this Agreement shall not operate as a waiver of any other breach
or
default, whether similar to or different from the breach or default
waived.
g. Entire
Agreement. This Agreement constitutes the entire agreement between the parties
hereto with respect to matters referred to herein, and no other agreement,
verbal or otherwise, shall be binding as between the parties unless it is in
writing and signed by the party against whom enforcement is sought.
All prior and contemporaneous agreements and understandings between
the parties with respect to the subject matter of this Agreement are superseded
by this Agreement.
h. Survival.
The respective rights and obligations of the parties hereunder shall survive
any
termination of this Agreement to the extent necessary to the intended
preservation of such rights and obligations.
i. Captions
and References. The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect. References in this Agreement to
a section number are references to sections of the Agreement unless otherwise
specified.
j. Resolution
of Disputes. Any disputes arising under or in connection with this Agreement
shall be resolved by binding arbitration, to be held in the metropolitan area
of
Company headquarters in accordance with the rules and procedures of the American
Arbitration Association. Judgment upon the award rendered by the arbitrator(s)
may be entered in any court having jurisdiction thereof. All costs and expenses
of any arbitration or court proceeding (including fees and disbursements of
counsel) shall be borne by the respective Party incurring such costs and
expenses, but the Company shall reimburse the Executive for such reasonable
costs and expenses in the event he substantially prevails in such arbitration
or
court proceeding.
IN
WITNESS WHEREOF, the undersigned have executed this Agreement on the date first
set forth above.
OSAGE
EXPLORATION AND DEVELOPMENT, INC.
________________________
Xxxx
Xxxxxxxx
Board
Member
_________________________
Ran
Xxxxxx
Board
Member
__________________________
Xxx
Xxxxxxxx
Chairman
of the Board
EXECUTIVE
_________________________
Xxxx
Xxxxxxxx
Executive
