EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made this 1st day of November, 1996, by and
between Xxxxxxx-Xxxx Gold Company, Inc., a Nevada corporation (the
"Corporation"), and Xxxxxxx X. Xxxx (the "Employee").
1. Employment
The Corporation hereby employs the Employee as Chief Financial Officer and
the Employee hereby accepts such employment in accordance with the terms and
conditions of this Agreement.
2. Duties of Employee
The duties of the Employee are generally to exercise detailed supervision
over all of the Corporation's accounting and financial affairs, subject to the
direction and control of the President and the Board of Directors of the
Corporation. The powers and duties of the Employee may include other duties as
may be more specifically determined and set, and may be changed, by the
President or Board of Directors of the Corporation from time to time. The
Employee shall strictly adhere to all of the rules and regulations of the
Corporation which are presently in force or which may be established hereafter
with respect to the conduct of Employees.
3. Power of Employee to Bind Corporation
The Employee's authority to obligate the Corporation on any contract or
agreement of any kind, character or nature is limited to those contracts or
obligations in which the Corporation's financial obligation does not exceed the
sum of $500,000 and the Employee shall have no authority to borrow funds for the
Corporation or to pledge any of its assets for any purpose whatsoever.
4. Other Employment
The Employee is required to refrain from acting in any other work capacity
or employments without having first obtained the written consent of the
Corporation. It is the Corporation's intention that the Employee devote all of
the Employee's work effort towards the fulfillment of the Employee's obligations
under this Agreement.
5. Place of Employment
The Employee's initial place of work is the principal office of the
Corporation located at 0000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000, Xxxxx x'Xxxxx,
Xxxxx. However, the Corporation may require that the Employee work at such other
place or places as the Corporation may direct. However, if the Employee is
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requested to relocate, the Corporation shall pay the Employee's reasonable
expenses in that regard.
6. Compensation of Employee
As compensation for all services rendered by the Employee under this
Agreement, the Corporation shall pay the Employee a salary of $85,000 annually,
payable not less frequently than in monthly installments. After the first year
of employment and on each annual anniversary date thereafter that this Agreement
is in effect, the Corporation shall increase the Employee's salary to reflect
any increases in the cost of living and, at the discretion of the Corporation,
for merit. Each such increase in salary shall not be less than 3.5%.
In addition, upon execution of this Agreement, the Employee shall receive a
stock option representing the option to purchase 100,000 shares of the
Corporation's common stock at an exercise price of $.56, exercisable at any time
after November 1, 1997 and prior to the close of business on November 1, 2002,
as evidenced by and pursuant to the terms of the option certificate attached to
this Agreement as Exhibit A.
7. Employee Benefits
During the first five years of employment the Employee shall be entitled to
three weeks paid vacation per year, after which time the Employee shall be
entitled to four weeks paid vacation per year, to be taken as shall be
reasonably consistent with the Employee's duties and obligations to the
Corporation. The Corporation shall reimburse the Employee on an annual basis for
the cost of the annual premium of a $500,000 term life insurance policy insuring
the life of the Employee, up to a maximum of $1,000 per year. The Corporation
shall also provide the Employee with such other benefits, including life and
health insurance, as the Corporation generally provides to its employees, which
may be changed from time to time at the discretion of the Corporation. Vacation
and other benefits are subject to the policies of the Corporation, as in effect
from time to time.
8. Employee Expenses
The Corporation shall reimburse the Employee for all reasonable and
necessary expenses incurred by the Employee in the furtherance of or in
connection with the business of the Corporation which have been authorized in
advance by the Corporation. In order to obtain reimbursement, the Employee shall
submit to the Corporation an itemized statement of such expenses along with
copies of bills and receipts. Further explanations may be required of the
Employee. Payments shall be made within 30 days after receipt of all necessary
documentation.
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9. Term of Employment
The term of employment shall begin November 1, 1996 and extend to October
31, 2001.
10. Termination of Employment
a. The Corporation may terminate the Employee's employment at will,
with or without cause and at any time, without prior notice. "Cause"
shall mean breach by the Employee of any term or provision of this
Agreement, or any other conduct or behavior by the Employee which the
Corporation reasonably believes constitutes criminal or unethical
conduct or behavior or which has a material adverse effect on the
Corporation. The Employee may terminate her employment at any time upon
30 day's notice.
b. If the Employee shall become unable to attend to the duties of
employment as required by this Agreement and it becomes necessary for
the Corporation to replace the Employee either temporarily or
permanently, the Corporation may do so and at the same time may suspend
all further payments to the Employee for salary or bonuses and all
other related compensation. The Corporation will recommence the payment
of salaries, bonuses and other compensation at such date as the
Employee shall resume and perform the Employee's duties under this
Agreement. The right of the Corporation as set forth above is in
addition to the right of the Corporation to terminate the Employee's
employment at any time as set forth above.
c. If the Employee's employment is terminated, all salaries, bonuses,
other compensation and benefits shall accrue and be paid to the
Employee to the date of the termination. Payments will be made with
respect to each item of compensation or benefit as soon as the amount
due is determined. In addition, if the Employee's employment is
terminated by the Corporation for any reason other than for cause: (i)
the Corporation shall pay to the Employee from the date of termination,
as severance compensation, the monthly salary of the Employee at the
date of termination for a period of (a) six months, if the date of
termination is during the first year of employment, or (b) six months
plus an additional two months for each full year of employment pursuant
to this Agreement, if the date of termination is after the first year
of employment; and (ii) the Corporation shall pay on behalf of the
Employee from the date of termination the Employee's monthly health
insurance premium for a period of (a) six months, if the date of
termination is during the first year of employment, or (b) six months
plus an additional two months for each full year of employment pursuant
to this Agreement, if the date of termination is after the first year
of employment, up to a maximum of twelve months. In the event the
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Employee's employment is terminated for cause, the Corporation shall
have the right to withhold any and all monies due to the Employee and
shall apply the same as an offset against any monies due to the
Corporation from the Employee as a result of any damages suffered by
the Corporation arising from the conduct or behavior which resulted in
termination for cause.
d. If the Employee dies while employed by the Corporation, this
Agreement shall automatically terminate.
11. Arbitration of Disputes
Any controversy or claim arising out of or relating to this Agreement,
the interpretation or breach of this Agreement, the Employee's employment by the
Corporation, or the termination of the Employee's employment shall be submitted
to and settled by arbitration in accordance with the Idaho Uniform Arbitration
Act. Judgment upon the award rendered in connection with such arbitration may be
entered in any court having jurisdiction thereof.
12. Severability; Governing Law
If any clause or provision of this Agreement shall be adjudged invalid
or unenforceable, it shall not affect the validity of any other clause or
provision, which shall remain in full force and effect. In the event any
provision of this Agreement is found to be unenforceable for any reason the
parties shall attempt to modify that portion in a manner to preserve the intent
of the parties in entering into the Agreement. The laws of Idaho shall apply to
this Agreement, except where Federal law applies. The parties consent to
jurisdiction and venue in any court of competent jurisdiction in the County of
Kootenai, Idaho, for any court proceedings which may be necessary following
arbitration or which may otherwise arise from this Agreement.
13. Complete Agreement
This Agreement supersedes all prior Agreements and understandings
between the Employee and the Corporation and may not be modified, changed or
altered by any unwritten promise or statement by whomsoever made; nor shall any
modification of it be binding upon the Corporation until such written
modification shall have been approved in writing by the President of the
Corporation.
14. Waiver of Breach
The waiver by the Corporation of a breach of any provision of this
Agreement by the Employee shall not operate or be construed as a waiver of any
other breach by the Employee.
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15. Employment by Subsidiary
If the Corporation owns, acquires or forms subsidiary companies or
becomes connected with other affiliate corporations, the Employee agrees to be
employed by any of the same and in such event all of the terms and conditions
set forth herein shall bind the parties.
16. General
This Agreement shall be binding upon and benefit any heirs,
subsidiaries, affiliates, successors, or assigns of the parties. All captions
used in this Agreement are for convenience only and shall have no meaning in the
interpretation or effect of this Agreement. The provisions of Section 11 of this
Agreement will survive the termination of this Agreement and remain in full
force and effect.
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement on and as of the date set forth above.
THE CORPORATION:
XXXXXXX-XXXX GOLD COMPANY, INC.,
a Nevada corporation
By: /s/ Xxxxxx Xxxxxxx
--------------------------------
Name: Xxxxxx Xxxxxxx
--------------------------------
Title: Chairman
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THE EMPLOYEE:
XXXXXXX X. XXXX
/s/ Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx
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