Attached files
| file | filename |
|---|---|
| 8-K - CROSS CANYON ENERGY CORP. | e606326_8k-cross.htm |
| EX-99.2 - CROSS CANYON ENERGY CORP. | e606326_ex99-2.htm |
| EX-99.1 - CROSS CANYON ENERGY CORP. | e606326_ex99-1.htm |
EMPLOYMENT
AGREEMENT
This
EMPLOYMENT AGREEMENT
(the “Agreement”) is dated as of January 15, 2010 (the “Effective Date”) and
entered into between Cross Canyon Energy Corp., a Nevada corporation having its
principal place of business at 6630 Cypresswood Drive, Suite 200, Spring, TX
77379 (the "Company"), and James B. Davis, an individual residing in the State
of Texas ("Executive"). The Company and Executive are referred to
individually herein as a “Party” and collectively as the “Parties.”
WHEREAS, Executive presently
serves as the Company’s Senior Vice President of Operations pursuant to an
Employment Agreement dated as of October 1, 2008 (the “Prior Agreement”);
and
WHEREAS, the Company desires
to continue to employ Executive and Executive desires to continue to be employed
by the Company subject to the terms and conditions hereinafter set
forth.
NOW, THEREFORE, in
consideration of the mutual covenants and agreements set forth herein, and for
other good and valuable consideration, the Parties agree as
follows:
1. Employment;
Title; Responsibilities; Reporting: The Company hereby employs
Executive and Executive hereby accepts employment upon the terms and conditions
hereinafter set forth. During the term of this Agreement, Executive
shall diligently and faithfully: (a) serve the Company in the capacity of
Executive Vice President of Operations and Chief Operating Officer; (b) report
directly to the President and Chief Executive Officer; (c) discharge and carry
out all duties and responsibilities as may from time to time be assigned, and
such directions as may from time to time be given, to Executive by the President
and Chief Executive Officer; and (d) abide by and carry out the policies and
programs of the Company in existence, and as may be changed from time to
time.
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3. Term: The
initial term of this Agreement shall commence on the Effective Date and shall
end on the one year anniversary thereof, unless sooner extended by agreement of
the parties or earlier terminated in accordance with the provisions of this
Agreement. The date on which this Agreement is scheduled to expire,
whether upon the expiration of the initial term or the expiration of an
additional term as set forth below, is referred to as the “End
Date”. No more than one hundred twenty (120) nor less than and sixty
(60) days prior to an End Date (each such sixty (60) day period is referred to
as a “Renegotiation Period”), the Company and Executive may agree in writing to
extend this Agreement for an additional term. If during any
Renegotiation Period the Company and Executive fail to agree upon an extension
of this Agreement, this Agreement shall terminate as of the End Date of the then
current term. The term of this Agreement, whether as originally
scheduled, extended by agreement or shortened pursuant to an earlier termination
in accordance herewith is referred to as the “Term.”
4. Base
Salary: The Company shall
pay Executive a base salary at the annualized rate of $190,000 (the “Base
Salary”). The Base Salary shall be paid in semi-monthly installments
on the fifteenth day and last day of each month and shall be subject to such
withholdings and deductions by the Company as are required to be made pursuant
to law, government regulations or order. Executive understands and
agrees that Executive is an exempt Executive as that term is applied for
purposes of Federal or state wage and hour laws, and further understands that
Executive shall not be entitled to any compensatory time off or other
compensation for overtime.
5. Bonus:
(a) As
consideration for Executive entering into this Agreement and agreeing to abide
by the terms hereof, the Company has agreed to pay to Executive a one-time
retention bonus in the amount of $95,000, minus all applicable withholdings and
deductions (the “Retention Bonus”). Such Retention Bonus shall be deemed earned
as of the Effective Date and shall be payable to Executive in full, on or before
the later of (x) February 1, 2010 and (y) the date that a recapitalization of
the Company is consummated.
(b) If
during the Term of this Agreement or within three (3) months after the
termination of Executive’s employment under this Agreement, the Company is sold
or its existing assets are sold in whole or in part (whether in one or more
transactions), then upon the closing of such sale transaction, Executive shall
be entitled to receive a bonus (“Sales Bonus”) as follows:
|
Gross Proceeds of
Sale
|
Sales Bonus Payable to
Executive
|
|
$15
million - $23.99 million
|
$142,500
|
|
$24
million - $29.99 million
|
$190,000
|
|
$30
million - $35.99 million
|
$285,000
|
|
$36
million or greater
|
$380,000
|
Similarly, if during the Term of this Agreement and continuing for a period of three months thereafter, the Company enters into a definitive agreement to sell the Company or its assets, then upon such sale (regardless of when such sale occurs), a Sales Bonus shall be due and payable to Executive pursuant to the schedule set forth above. Any Sales Bonus earned hereunder shall be payable to Executive on the date of closing of any sales transaction directly from the proceeds of any such sales transaction and shall be subject to such withholdings and deductions by the Company as are required to be made pursuant to law, government regulations or order. In the event that the Company acquires a material amount of additional assets after the date hereof, then the Company and the Executive shall cooperate to determine a mutually acceptable bonus program with respect to the sale of such assets.
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6. Fringe
Benefits: During the Term of this Agreement, Executive shall
be entitled to continue to participate in major medical and full hospital
insurance programs and plans for Executive, his spouse and immediate dependents,
at such levels as are presently maintained. Executive shall also be
entitled to continue such disability, life insurance, dental, vision and other
similar benefits as are presently in effect for senior officers of the Company
under such group benefit plans and/or programs as may be implemented and
maintained by the Company from time to time. Executive’s eligibility
for, and participation in (and his spouse and immediate dependents’ eligibility
for, and participation in, as applicable) all programs and plans referenced in
this Section 6 are subject to the terms and conditions of all applicable
programs and plans. The Company shall pay eighty percent (80%) of the
premium cost of such fringe benefits for Executive, his spouse and immediate,
eligible dependents. Additionally, to the extent permitted by law, the Company
will match up to five percent (5%) of Executive’s total compensation including
any bonus in the Company’s 401-K Plan. Executive's entitlement to
such benefits shall end upon the termination of his employment with the Company,
however caused, except as provided (a) by applicable law or (b) by the express
terms of any such group benefit plan or program maintained by the
Company.
7. Vacation: During
the Term of this Agreement, Executive shall be entitled to four (4) weeks paid
vacation per calendar year, to be taken at such time or times as shall be
consistent with Company needs and the proper performance by Executive of his
duties. No unused vacation may be carried forward from year to
year.
8. Expense
Reimbursement; Travel Policy: The Company shall provide
Executive with such reasonable business lodging and travel expense
reimbursements as are consistent with the Company’s policies in effect from time
to time as they pertain to senior officers of the Company. All
reimbursements by the Company provided for in this Agreement are conditioned
upon Executive’s timely submission to the Company of all required documentation
and an itemized account for such expenses within sixty (60) days after they are
incurred. Expense reports and requests for reimbursement which are
submitted later than sixty (60) days after the expense is incurred will not be
reimbursed without the approval of the Company’s Chief Financial
Officer. Executive is not permitted to receive a payment or benefit
in lieu of reimbursement under this Section 8.
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10. Disability
of Executive: If Executive shall, during the term of this
Agreement, suffer a “Disability,” (as defined, from time to time, in a
disability plan that the Company may maintain for the benefit of its senior
officers (a “Disability Plan”) or, whenever no such Disability Plan exists, as
defined in accordance with the meaning on Exhibit A attached hereto and made a
part hereof), then the Company shall have the right to terminate this Agreement
by written notice of such Disability to Executive, whereupon the Company’s
obligations and agreements under this Agreement shall automatically terminate as
of the date of such notice, and in full satisfaction thereof, the Company shall
pay to Executive any Base Salary earned and unpaid through the date of such
notice (less any payments received by Executive under a Disability Plan) and any
business expenses or other fringe benefits otherwise due to
Executive. Executive shall also be entitled to payment for (i) any
Retention Bonus earned but not yet paid, which such Retention Bonus shall not be
subject to repayment pursuant to Section 12, (ii) any Sales Bonus earned but not
yet paid and (iii) accrued but unused vacation days during the calendar year
such termination occurs. No such termination shall be deemed a
“Termination Without Cause” as defined in Section 14 below. Such
payments shall be provided to Executive’s heirs or estate, as applicable, within
the time frame otherwise provided under this Agreement or, in case of any
accrued but unused vacation days, on the next regular pay period that follows
Executive’s termination due to his Disability. All other
obligations of the Company under this Agreement shall automatically cease, and
Executive shall not be entitled to any other salary, payments or benefits
otherwise payable under this Agreement, except as otherwise required by
law.
11. Resignation
By Executive Without Good Reason: Notwithstanding the
provisions of Section 3 above, Executive may resign his employment hereunder
without Good Reason (as defined below) upon sixty (60) days’ prior written
notice to the Company (such notice hereinafter referred to as a “Resignation
Notice”). If the Company receives any such Resignation Notice, the
Company may elect, in its sole discretion and for any reason or for no reason,
to accept Executive’s resignation as of the date set forth in the Resignation
Notice, which such date shall not be later than sixty (60) days after it is
provided to the Company, or request that the Executive remain through the full
sixty (60) day period.
12. Post-Resignation
Obligations: No resignation under Section 11 hereof shall be
treated as if it was a “Termination Without Cause” as defined in Section 14
below. Executive agrees and understands that, in the event of any
resignation pursuant to Section 11, Executive shall be entitled to receive
Executive’s then applicable Base Salary through the date of resignation
specified in the Resignation Notice and any business expenses otherwise due to
Executive. If Executive delivers a Resignation Notice within six (6)
months after the Effective Date, then Executive shall be required to repay such
portion of the Retention Bonus equal to a fraction, the numerator of which is
the difference between (x) one hundred eighty (180) and (y) the number of days
worked by Executive between the Effective Date and the effective date of his
resignation, and the denominator of which is one hundred eighty
(180). All other obligations of the Company under this Agreement
shall automatically cease as of the date of Employee’s resignation, and
Executive shall not be entitled to any other salary, payments or benefits
otherwise payable under this Agreement, except as otherwise required by
law.
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13. Resignation
for Good Reason: If Executive
resigns for “Good Reason” (as defined below), then such a resignation shall be
treated hereunder as if it were a “Termination Without Cause,” as defined in
Section 14 below. “Good Reason” means the occurrence of any of the
following events: (i) a material diminution by the Company of Executive’s
responsibilities, duties, or authority in comparison with the responsibilities,
duties and authority held during the six month period immediately preceding such
diminution, which such diminution shall include but not be limited to, his no
longer serving as Executive Vice President of Operations and Chief Operating
Officer of the Company (ii) a material diminution in Executive’s base
compensation; or (iii) the involuntary, material relocation of the geographic
location of Executive’s principal place of employment, which shall exist if
Executive is required to relocate such principal place of employment to a
location more than 50 miles from downtown Houston,
Texas. Notwithstanding the foregoing, or any other provision in this
Agreement to the contrary, any assertion by Executive of a termination for “Good
Reason” shall not be effective unless all of the following conditions are
satisfied: (1) the condition arising in Sections 13(i), (ii) or (iii) above must
have arisen without Executive’s consent; (2) Executive must provide written
notice to the Company of such condition within twenty (20) days of the initial
existence of the condition; (3) the condition specified in such notice must
remain uncorrected for thirty (30) days after receipt of such notice by the
Company; and (4) the date of Executive’s termination of employment must occur
within sixty (60) days after the initial existence of the condition specified in
such notice.
14. Termination
Without Cause: Executive’s employment under this Agreement may
be terminated at any time by the Company, without Cause (as defined below) and
for reasons other than the non-renewal of this Agreement, Executive’s death or
Disability (such termination referred to throughout this Agreement as a
“Termination Without Cause”). Such a Termination Without Cause shall
be effective upon fourteen (14) days written notice to Executive. In
the event of a Termination Without Cause, the Company shall provide to Executive
any Retention Bonus earned and unpaid through the date of such termination and
any business expenses and other fringe benefits otherwise due to the
Executive. Such payments will be provided pursuant to the time frame
otherwise set forth in this Agreement. In the event of a Termination
Without Cause, Executive also shall be entitled to payment for (i) any Sales
Bonus that would have otherwise been earned by Executive had such executive
remained employed by the Company for the remainder of the then current Term in
which the termination occurred and for three (3) months thereafter and (ii)
accrued but unused vacation days for the calendar year in which such termination
occurs. In addition, if Executive executes (and does not revoke) a
release of claims acceptable to the Company and substantially in the form of the
release attached as Exhibit C, the
Company will provide Executive as severance pay, an amount equal to six (6)
months Base Salary (the “Severance Payment”). The Severance Payment
shall be payable as a lump sum within ten (10) business days following the date
on which the release referenced herein becomes irrevocable. Unless
specifically referenced in this Section 14, all obligations of the Company under
this Agreement shall automatically cease as of the date of Executive’s
Termination Without Cause and the Executive shall not be entitled to any other
salary, payments or benefits otherwise payable under this Agreement, except as
otherwise required by law.
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15. Termination
For Cause: The Company, upon
a vote of the Company’s Board of Directors shall be entitled to immediately
terminate Executive’s employment in any of the following circumstances, each of
which shall constitute "Cause" for such termination:
(a) the
breach by Executive, in any material respect, of this Agreement (including,
without limitation, the refusal or other failure by Executive to perform any of
Executive’s duties hereunder other than a failure to perform resulting from
death or Disability) and failure by Executive to cure such breach within ten
(10) days of written notice thereof from the Company;
(b) the
commission by Executive of any act of dishonesty, fraud, material
misrepresentation or moral turpitude in connection with his employment,
including, but not limited to, misappropriation or embezzlement of any funds of
the Company or any of its affiliates;
(c) the
commission by Executive of any (1) willful misconduct or gross negligence, or
(2) intentional act having the effect of, or that may have the effect of,
injuring the reputation, business or business relationships of the Company or
any of its affiliates, and which intentional act the Board deems to not be in
the best interests of the Company;
(d) the
entering by Executive of a plea of guilty or nolo contendere to, or the
conviction of Executive for, a crime (other than a routine traffic
offense);
(e) Executive’s
abuse of alcohol, prescription drugs or controlled substances to a degree which
interferes with his performance on behalf of the Company;
(f) Executive’s
deliberate disregard of any lawful material rule or policy of the Company or
order of the Company’s Board of Directors and failure to cure the same within
ten (10) days of written notice thereof from the Company; or
(g) Executive’s
excessive absenteeism other than for reasons of illness, which such absenteeism
is not cured after written notice from the Company with respect
thereto.
If
Executive is terminated for any of the causes referred to in the above
sub-paragraphs (a) through (g), all obligations of the Company under this
Agreement shall automatically cease and Executive shall only be entitled to
receive Executive’s then applicable Base Salary through the date of termination,
any business expenses or fringe benefits otherwise due to Executive, and any
Retention Bonus and/or Sales Bonus earned by Executive and not yet
paid. Executive shall not be entitled to any other salary, payments
or benefits otherwise payable under this Agreement, except as otherwise required
by law.
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16 Termination
Following Change of Control: If: (A)
Executive's employment is terminated by the Company at any time following a
Change of Control (as defined on Exhibit B), excluding
the Change in Control which may occur in the event the Company files a petition
seeking protection under Federal Bankruptcy laws; and (B) such termination is
for reasons other than Cause pursuant to Section 15 above or other than by
reason of Disability or Executive's death, then (1) Executive shall be entitled
to receive the greater of (x) the amount of Executive’s then applicable Base
Salary that would have been earned through the expiration of the End Date of the
term in which the termination of his employment occurred; or (y) six (6) months
Base Salary, together with any business expenses otherwise due to Executive (the
“Change of Control Payment”); provided, however, that
Executive’s entitlement to the Change of Control Payment is conditioned upon his
execution (and non-revocation) of a release of claims acceptable to the Company
and substantially in the form of the release attached at Exhibit
C. If applicable, the Change of Control Payment shall be paid
as a lump sum within ten (10) business days following the date on which the
release referenced herein becomes irrevocable. All other obligations
of the Company under this Agreement shall automatically cease, and Executive
shall not be entitled to any other salary, payments or benefits otherwise
payable under this Agreement, except as otherwise required by law.
17. Payment
Upon Expiration of the Term: In the event that (i) this
Agreement expires as of the End Date, without being extended for another term
and (ii) Executive has not earned a Sales Bonus hereunder, then the Company
agrees to pay to Executive four (4) months worth of his Base Salary; provided, however, that
Executive’s entitlement to such payment is conditioned upon Executive’s
execution (and non-revocation) of a release of claims acceptable to the Company
and substantially in the form of the release attached at Exhibit
C. If applicable, the severance payment contemplated by this
Section 17 shall be paid as a lump sum within ten (10) business days following
the date on which the release referenced herein becomes
irrevocable. All other payments, benefits or arrangements provided by
the Company shall cease immediately as of the expiration of the Term, except as
otherwise required by this Agreement, by law or the terms of any plan maintained
by the Company.
18. Non-Solicitation;
Non-Competition:
(a) The
Parties agree to the non-solicitation and non-competiton provisions of this
Section 18 in consideration for the Confidential Information provided to
Executive pursuant to Section 19 below, to protect the trade secrets and other
Confidential Information of the Company and as an express inducement for the
Company to enter into this Agreement. During the Term, and for one
(1) year thereafter, Executive expressly agrees that Executive will not,
directly or indirectly:
(i) for
his own account or on behalf of any other person or as an employee, consultant,
manager, agent, representative, broker, stockholder, director or officer of a
corporation, company, individual, investor, owner, lender, partner, joint
venturer, or otherwise engage in any business which is then engaged in the
exploration, drilling or production of natural gas or oil, within any 5-mile
radius of any property in which the Company has or had an ownership, leasehold
or participation interest during the Term of this Agreement;
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(ii) solicit,
entice or induce any Customer (as defined below) of the Company to cease or
limit its business with the Company (except if and to the extent directed to do
so by the Board of Directors of the Company), or to become a customer, supplier,
vendor or client of any other person (including, without limitation, Executive,
individually) or entity engaged in any activity or business competitive with the
Company; and
(iii) engage
in any act or practice the purpose of which is to evade the provisions of this
covenant not to solicit or not to compete or to commit any act which adversely
affects the business of the Company.
For
purposes of this Agreement, a “Customer” of the Company shall mean any person or
entity, who or which is, or was at any time within the prior one year period, a
purchaser of goods or services from the Company, a landlord, sublandlord,
licensor, licensee or supplier of (or prospective purchaser, landlord,
sublandlord, licensor, licensee or supplier, provided the Company was in active
discussions with such party prior to the termination of Executive’s employment),
to or from the Company, as the case may be.
(b) Executive
expressly acknowledges and agrees that the covenants contained in this Section
18 are essential elements of this Agreement and that, but for the agreement of
Executive to comply with such covenants, the Company would not have agreed to
enter into this Agreement and would not have agreed to the provisions of Section
19. Executive acknowledges that the provisions of this Section 18 are
reasonable and necessary for the protection of the Company and that enforcement
of the provisions of this Section 18 shall not result in an unreasonable
deprivation of the right of Executive to earn a living. The existence
of any claim or cause of action of Executive against the Company, whether
predicated on this Agreement or otherwise, shall not constitute a defense to the
enforcement by the Company of such covenants. The Parties expressly
agree that the restrictions set forth in this Agreement are reasonable and no
greater than necessary to protect the Company’s legitimate business
interests. Nonetheless, in the event a court of competent
jurisdiction determines that the provisions of this Section 18 are excessively
broad as to duration, geographical scope or activity, it is expressly agreed
that Section 18 shall be construed so that the remaining provisions shall not be
affected, but shall remain in full force and effect, and any such overbroad
provisions shall be deemed, without further action on the part of any person, to
be modified, amended and/or limited, to the extent necessary to render the same
valid and enforceable in such jurisdiction.
19. Non-Disclosure
of Confidential Information:
(a) The
Company will disclose to Executive, and place Executive in a position to have
access to or develop, Confidential Information (as defined below) of the
Company. Executive acknowledges and agrees that Executive’s services
for the Company shall bring Executive into contact with sensitive, secret and
non-public information relating to the Company, its successors, subsidiaries,
assigns, officers, employees, executives, associated entities and/or agents
including, but not limited to (i) information concerning the objectives, plans,
strategies, commitments, contracts, leases, operations, employees, executives,
methods, market investigations, surveys, research, records, costs and prices of
the Company and/or the Company’s subsidiaries or associated entities, (ii)
information concerning the identities, objectives, plans, preferences, needs,
requests, specifications, commitments, contracts, operations, methods and
records of the Company’s and/or its subsidiaries’ or associated entities’
lenders, prospective lenders, investors, owners and/or prospective owners, and
(iii) any and all information, trade secrets or non-public ideas that give the
Company or its subsidiaries or associated entities the opportunity to obtain an
advantage over such competitors of the Company or of such subsidiaries or
associated entities that do not know or use such information, trade secrets or
ideas (the “Confidential Information”).
-8-
(b) Executive
further understands and acknowledges that Confidential Information includes not
only recorded or written information, but also information that Executive can
recall or reconstruct from Executive’s memory.
(c) Executive
agrees that he will, at all times, faithfully hold all such Confidential
Information in the strictest of confidence and will, at all times, use his best
efforts and highest diligence to keep such Confidential Information secret, to
guard against its disclosure, and never, directly or indirectly, to use or
disclose or divulge any such Confidential Information to any person, company,
firm or other entity, or to use the same, except that (i) Executive may use
Confidential Information as necessary to perform his duties of employment with
the Company, (ii) Executive may disclose Confidential Information to those
within the Company who have a need to know it in the performance of their duties
for the Company, (iii) Executive may disclose Confidential Information to
parties outside the Company when, as and if he is expressly directed to do so by
Executive’s supervisors within the Company, and (iv) Executive may disclose
Confidential Information as expressly directed by judicial process, provided
that Executive has promptly, and prior to making such disclosure, provided a
copy of such judicial process to the Company and provided the Company with
sufficient opportunity to intervene in order to oppose such
disclosure.
(d) Notwithstanding
the foregoing, after any termination or resignation of Executive from his
employment with the Company, Confidential Information shall not include, and
Executive shall not be restricted from divulging or using, any information which
Executive can demonstrate (i) is or becomes generally available to the public
other than as a result of a disclosure by Executive, (ii) was available to
Executive on a non-confidential basis prior to its disclosure to Executive by
the Company or any of its subsidiaries or associated entities, or (iii) becomes
available to Executive on a non-confidential basis from a source other than the
Company or any of its subsidiaries or associated entities, provided, however, that such
source was not bound by a confidentiality agreement with the Company or any of
its subsidiaries or associated entities, or was not otherwise prohibited from
transmitting such information to Executive.
(e) Executive
agrees that upon any termination, resignation or expiration of his employment
with the Company, however caused, Executive shall deliver to the Company all
writings, documents, recordings, computer discs and other media of recordation
or storage in his possession, custody or control containing any Confidential
Information (including, without limitation, all duplicates and copies), shall
relinquish access to any computer maintained by or for the benefit of the
Company or any of its subsidiaries or associated entities, and shall return all
such Confidential Information (in whatever form, including electronic data) to
the Company and not retain any copies of such Confidential
Informaiton. To ensure compliance with this Agreement, at the time of
such termination, resignation or expiration, Executive shall provide the Company
with a sworn statement, duly notarized, that Executive has performed each and
every agreement and obligation contained or referred to in this
Section.
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20. Company
Property: All inventions, improvements, systems, designs,
ideas, business plans, sales techniques, approaches, surveys, prospect books,
publications, memoranda, customer lists, files, notes, records, videotapes or
any other business documentation or products (including, without limitation,
Confidential Information) that Executive makes or conceives (either
individually or jointly with others) or that are made available to Executive
during his employment with the Company and until any termination, resignation or
expiration of such employment for any reason, relating to and connected with his
employment, or that Executive utilizes in carrying out his duties or
responsibilities to the Company (the "Property"), shall be the Company’s
exclusive property, and Executive assigns to the Company all of his rights, if
any, in and to all such Property.
21. Trade
Names, Trademarks and Copyright: During his employment with
the Company, and continuing for all time after any termination, resignation or
expiration of such employment for any reason, Executive agrees that he shall
never have or claim any right, title or interest in any trade name, trademark or
copyright (statutory or common law) belonging to or used by the Company, its
subsidiaries, successors, assigns or associated entities, and shall never have
or claim any right, title or interest in any material or matter of any sort,
prepared for or used in connection with advertising, solicitation, circulation,
editorial content or promotion of the business of the Company, its subsidiaries,
successors, assigns or associated entities, whether produced, prepared or
published in whole or in part by Executive. Executive recognizes that
the Company and/or its subsidiaries or associated entities now have and shall
hereafter have and retain sole and exclusive rights in and to any and all such
trade names, trademarks, copyrights, material and matter.
22. Injunctive
Relief: Executive expressly acknowledges and agrees that the
Property and the Confidential Information are of a special, unique, unusual,
extraordinary and intellectual character which gives them a peculiar value, and
that a breach by Executive of any of the restrictive covenants contained in
paragraphs 18 through 21 herein will cause the Company irreparable injury and
damage for which there is no adequate remedy available at
law. Executive further expressly acknowledges and agrees that the
Company shall be entitled, in addition to any remedies available at law and
equity, to injunctive or other equitable relief to require specific performance,
or to prevent a breach, of any provision of this Agreement by Executive without
any requirement or showing that the Company has suffered any damages from such
breach.
23. Further
Instruments: Executive shall execute, acknowledge, deliver and
procure the execution, acknowledgment and delivery to the Company of any and all
further instruments which the Company may reasonably deem necessary or expedient
to carry out or effectuate the purposes or intent of this
Agreement.
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24. Representations. Executive
represents and warrants to the Company that Executive has the capacity and right
to negotiate and enter into this Agreement, and Executive's execution, delivery
and performance of this Agreement does not breach, interfere with or conflict
with any other contractual agreement, covenant not to compete, option, right of
first refusal or other existing business relationship or any judgment or order,
in each case, to which Executive is a party or otherwise
subject.
25. Successors
and Assigns: This Agreement, and all of the Company’s rights
under it, may be assigned by the Company without the prior consent of
Executive. Executive expressly agrees that this Agreement may be
assigned by the Company, without limitation, in connection with a merger, sale
of a majority of the outstanding shares or consolidation of the Company or a
sale of substantially all of the Company assets. This Agreement shall
be binding upon the successors, heirs, executors and personal representatives of
Executive. This Agreement contemplates the rendition of personal
services by Executive and is not assignable by Executive.
26. Savings
Clause: If any term or provision of this Agreement or the
application thereof to any person or circumstance shall, to any extent, be
invalid or unenforceable, the remainder of this Agreement, and the application
of such term or provision to persons or circumstances other than those as to
which it is held invalid or unenforceable, shall not be affected thereby, and
each term and provision of this Agreement shall be valid and be enforced to the
fullest extent permitted by law. The Company’s rights and remedies
provided for in this Agreement or by law shall, to the extent permitted by law,
be cumulative.
27. Indemnification: In
the event Executive is made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by the Company against Executive, by reason
of the fact that Executive was performing services under this Agreement or that
Executive was or is an officer, director or employee of the Company), then the
Company shall indemnify, hold harmless and defend Executive against all expenses
(including attorneys' fees and expenses), judgments, fines and amounts paid in
settlement, as actually and reasonably incurred by Executive in connection
therewith, to the maximum permitted by applicable law. The advance of
expenses shall be mandatory to the extent permitted by applicable
law. In the event that both Executive and the Company are made party
to the same third-party action, complaint, suit or proceeding, the Company
agrees to engage counsel, and Executive consents to use the same counsel, which
consent will not be unreasonable withheld, provided that if counsel selected by
the Company shall have a conflict of interest that prevents such counsel from
representing Executive and the Company at the same time, Executive may engage
separate counsel and the Company shall pay all reasonable attorneys' fees and
expenses of separate counsel. The Company shall not be required to
pay the fees of more than one law firm except as described in the preceding
sentence. Further, while Executive is expected to faithfully discharge his
duties under this Agreement, Executive shall not be held liable to the Company
for errors or omissions made in good faith where Executive has not exhibited
intentional misconduct or performed criminal or fraudulent
acts. Notwithstanding the above, the Company’s obligation to
indemnify Executive is subject to any prohibitions as a matter of law that the
company cannot indemnify the executive.
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28. Governing
Law; Construction: Any and all differences and disputes of
whatever nature arising out of or relating to this Agreement (including, without
limitation, the negotiation, execution, performance or termination of this
Agreement) shall be governed by the laws of the State of Texas applicable to
contracts made, negotiated and to be performed entirely in such State without
giving effect to its principles of conflicts of laws. With respect to
all such differences and disputes, the parties agree and consent to be subject
to the exclusive jurisdiction of the state and federal courts located in Harris
County in the State of Texas and consent to the exclusive venue of such
courts.
29. Notices: All
notices to be given under this Agreement shall be in writing and shall be given
by hand, by overnight courier services which obtain acknowledgment of receipt or
by certified or registered mail, return receipt requested, addressed to the
party receiving such notice (each of the foregoing being referred to as "Written
Notice"), or by facsimile transmission, such transmission being effective as of
the date thereof if followed within ten (10) business days by Written Notice, as
follows:
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(a)
|
if to the Company, to: |
Cross Canyon Energy Corp.
6630 Cypresswood Drive, Suite
200
Spring, Texas 77379
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(b)
|
if
to Executive, to his home address on file with the
Company,
|
The
Parties may change their designated address and information for purposes of
notices upon written notice to the other Party.
30. Freedom
to Execute Agreement: The Company and Executive each
represent, warrant and agree that they are free to enter into this Agreement,
and that they are not subject to any obligations or disability which would
prevent them from or interfere with their fully keeping and performing all of
the covenants and conditions to be kept or performed under such
agreements. The Company and Executive further represent, warrant and
agree that they have not made and will not make any grant or assignment which
conflicts with or impairs the complete enjoyment of the rights and privileges
granted to the Company and Executive under this Agreement. Executive
has had the opportunity to consult with his personal attorney and to negotiate
this Agreement at “arms-length”.
31. Entire
Agreement; Prior Agreement is Superseded: This Agreement
constitutes the entire agreement between the Company and Executive relating to
the subject matter herein, and all prior negotiations, agreements and
understandings of the Parties have been merged into this
Agreement. For the avoidance of doubt, Executive expressly
acknowledges and agrees that he has been provided all compensation, benefits and
other consideration to which he was entitled, may have been entitled or could be
entitled under the Prior Agreement and that the Prior Agreement in hereby
terminated and superseded in its entirety with the Company owing no future
duties under that agreement whatsoever. No modification of this
Agreement shall be valid unless in writing and executed by each of the Parties
hereto.
-12-
32. Waiver of
Breach: The waiver of a breach or default of or under any
provision of this Agreement shall not be deemed a waiver of any other such
breach or default of any kind or nature.
33. Approvals: This
Agreement has been approved by the necessary vote of the Company’s Board of
Directors of the Company.
34. Withholdings: The Company may
withhold from all sums owed by it pursuant to this Agreement all taxes,
withholdings and other deductions required by law or otherwise agreed to by
Executive.
[Remainder
of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the
parties have signed this Agreement as of the date first above
written.
| Company: | CROSS CANYON ENERGY CORP. | ||
|
By:
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| Name: | Robert P. Munn | ||
| Title: | President and Chief Executive Officer | ||
| Executive: | JAMES B. DAVIS | ||
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| James B. Davis | |||
-14-
Exhibit
A
For the
purposes of this Agreement, whenever the term “Disability” is not defined in a
Disability Plan that the Company may maintain for the benefit of its senior
officers, that term shall mean that, for a period of “120 continuous days”,
Executive is “limited” from performing the “material and substantial duties” of
his “regular occupation” due to his “sickness” or “injury.”
For
purposes of this definition:
“120
continuous days” shall mean 120 days of sickness or injury which meets all of
the other criteria for a Disability as defined herein, with no lapse of greater
than 30 days (consecutively or in the aggregate);
“limited”
from performing a duty or function means that Executive is unable to perform
such duty or function;
“material
and substantial duties” means duties that are normally required for the
performance of Executive’s “regular occupation” and cannot be reasonably omitted
or modified;
“regular
occupation” means all of the functions that Executive was routinely performing
while he was actively employed by the Company pursuant to this Agreement and
prior to the onset of the condition or conditions that resulted in the Company’s
decision to terminate Executive’s employment for reasons related to
Disability;
“sickness”
means any illness or disease that renders Executive incapable of performing
material and substantial duties of his employment under the Employment
Agreement; and
“injury”
means a bodily injury that is the direct result of an accident and not related
to any other cause.
Exhibit
B
For the
purposes of this Employment Agreement, the term “Change of Control” shall mean:
(i) a sale, transfer, or other disposition through a single transaction or a
series of transactions of all or substantially all of the assets of the Company
to another entity other than an affiliate of the Company; or (ii) any
consolidation or merger of the Company with or into another entity, unless
immediately after the consolidation or merger the holders of the common stock of
the Company immediately prior to the consolidation or merger are the beneficial
owners (within the meaning of Rule 13d-3 promulgated under the Securities and
Exchange Act of 1934, as amended) of securities of the surviving corporation
representing at least fifty (50%) percent of the combined voting power of the
surviving corporation’s then outstanding securities. Notwithstanding
the previous sentence, a Change of Control will be deemed to have occurred if
50% or more of the fully diluted voting shares transfer to a single entity other
than an affiliate fo the Company or a group of shareholders other than
affiliates of the Company that act as a single entity for voting purposes,
within a twelve month period, in any manner other than a primary or secondary
public stock offering.
Exhibit
C
RELEASE
AGREEMENT
This
Release Agreement (this “Agreement”)
constitutes the release referred to in that certain Employment Agreement (the
“Employment
Agreement”) dated as of January __, 2010, by and among James B. Davis
(“Employee”)
and Cross Canyon Energy Corp. (the “Company”).
(a) For
good and valuable consideration, including the Company’s provision of certain
payments and benefits to Employee in accordance with Section 14 or 16 of the
Employment Agreement, Employee hereby releases, discharges and forever acquits
the Company, its affiliates and subsidiaries and the past, present and future
stockholders, members, partners, directors, officers, managers, employees,
agents, attorneys, heirs, legal representatives, successors and assigns of the
foregoing, in their personal and representative capacities (collectively, the
“Company
Parties”), from liability for, and hereby waives, any and all claims,
damages, or causes of action of any kind related to Employee’s employment with
any Company Party, the termination of such employment, and any other acts or
omissions related to any matter on or prior to the date of this Agreement
including without limitation any alleged violation through the date of this
Agreement of: (i) the Age Discrimination in Employment Act of 1967,
as amended; (ii) Title VII of the Civil Rights Act of 1964, as amended; (iii)
the Civil Rights Act of 1991; (iv) Section 1981 through 1988 of Title 42 of the
United States Code, as amended; (v) Employee Retirement Income Security Act of
1974, as amended (“ERISA”); (vi) the Immigration Reform Control Act, as amended;
(vii) the Americans with Disabilities Act of 1990, as amended; (viii) the
National Labor Relations Act, as amended; (ix) the Occupational Safety and
Health Act, as amended; (x) the Family and Medical Leave Act of 1993; (xi) any
state anti-discrimination law; (xii) any state wage and hour law; (xiii) any
other local, state or federal law, regulation or ordinance; (xiv) any public
policy, contract, tort, or common law claim; (xv) any allegation for costs,
fees, or other expenses including attorneys’ fees incurred in these matters;
(xvi) any and all rights, benefits or claims Employee may have under any
employment contract, incentive compensation plan or stock option plan with any
Company Party or to any ownership interest in any Company Party except as
expressly provided in the Employment Agreement and any stock option or other
equity compensation agreement between Employee and the Company and (xvii) any
claim for compensation or benefits of any kind not expressly set forth in the
Employment Agreement or any such stock option or other equity compensation
agreement (collectively, the “Released
Claims”). In no event shall the Released Claims include (a)
any claim which arises after the date of this Agreement, (b) any claim to vested
benefits under an employee benefit plan (withint the meaning of Section 3(3) of
ERISA) , or (c) any claims for contractual payments under the Employment
Agreement. This Agreement is not intended to indicate that any such
claims exist or that, if they do exist, they are meritorious. Rather,
Employee is simply agreeing that, in exchange for the consideration recited in
the first sentence of this paragraph, any and all potential claims of this
nature that Employee may have against the Company Parties, regardless of whether
they actually exist, are expressly settled, compromised and
waived. By signing this Agreement, Employee is bound by
it. Anyone who succeeds to Employee’s rights and responsibilities,
such as heirs or the executor of Employee’s estate, is also bound by this
Agreement. This release also applies to any claims brought by any
person or agency or class action under which Employee may have a right or
benefit. Notwithstanding this release of liability, nothing in this
Agreement prevents Employee from filing any non-legally waivable claim
(including a challenge to the validity of this Agreement) with the Equal
Employment Opportunity Commission (“EEOC”) or comparable state or local agency
or participating in any investigation or proceeding conducted by the EEOC or
comparable state or local agency; however, Employee understands and agrees that
Employee is waiving any and all rights to recover any monetary or personal
relief or recovery as a result of such EEOC or comparable state or local agency
proceeding or subsequent legal actions. THIS RELEASE INCLUDES MATTERS
ATTRIBUTABLE TO THE SOLE OR PARTIAL NEGLIGENCE (WHETHER GROSS OR SIMPLE) OR
OTHER FAULT, INCLUDING STRICT LIABILITY, OF ANY OF THE COMPANY
PARTIES.
(b) Employee
agrees not to bring or join any lawsuit against any of the Company Parties in
any court relating to any of the Released Claims. Employee represents
that Employee has not brought or joined any lawsuit or filed any charge or claim
against any of the Company Parties in any court or before any government agency
and has made no assignment of any rights Employee has asserted or may have
against any of the Company Parties to any person or entity, in each case, with
respect to any Released Claims.
(c) By
executing and delivering this Agreement, Employee acknowledges
that:
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(i)
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Employee has carefully read this Agreement; |
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(ii)
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Employee
has had at least [twenty-one (21)] [forty-five (45)] days to consider this
Agreement before the execution and delivery hereof to the Company [Add if
45 days applies: , and Employee acknowledges that attached to this
Agreement are (1) a list of the positions and ages of those employees
selected for termination (or participation in the exit incentive or other
employment termination program); (2) a list of the ages of those employees
not selected for termination (or participation in such program); and (3)
information about the unit affected by the employment termination program
of which Employee’s termination was a part, including any eligibility
factors for such program and any time limits applicable to such
program];
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(iii)
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Employee
has been and hereby is advised in writing that Employee may, at Employee’s
option, discuss this Agreement with an attorney of Employee’s choice and
that Employee has had adequate opportunity to do so;
and
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(iv)
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Employee
fully understands the final and binding effect of this Agreement; the only
promises made to Employee to sign this Agreement are those stated in the
Employment Agreement and herein; and Employee is signing this Agreement
voluntarily and of Employee’s own free will, and that Employee understands
and agrees to each of the terms of this
Agreement.
|
Notwithstanding
the initial effectiveness of this Agreement, Employee may revoke the delivery
(and therefore the effectiveness) of this Agreement within the seven day period
beginning on the date Employee delivers this Agreement to the Company (such
seven day period being referred to herein as the “Release
Revocation Period”). To be effective, such revocation must be
in writing signed by Employee and must be delivered to the Chairman of the Board
of Directors of the Company before 11:59 p.m., Houston, Texas time, on the last
day of the Release Revocation Period. If an effective revocation is
delivered in the foregoing manner and timeframe, this Agreement shall be of no
force or effect and shall be null and void ab
initio. No consideration shall be paid if this Agreement is
revoked by Employee in the foregoing manner.
Executed
on this ___________ day of _____________, _______.
_________________________________
James B.
Davis