EXHIBIT 10.23
ARAXAS ENERGY CORPORATION
ARAXAS EXPLORATION, INC.
September 24, 1997
John L. Faulkinberry
42 West Rock Wing Place
The Woodlands, Texas 77381
Re: Severance Agreement
Dear John:
This letter will confirm the terms of your severance agreement with Araxas
Exploration, Inc. ("Exploration"), Araxas Energy Corporation ("Araxas"), and
XPLOR Energy, Inc. ("XPLOR") and the other subsidiaries and affiliates of
Exploration, Araxas and XPLOR (collectively referred to as the "Company"), which
are set forth below:
1. Your resignation as an employee and officer of the Company will be
effective on the date you execute and deliver to the Company this letter
agreement ("Effective Date").
2. On the Effective Date, Company agrees to pay you $50,000 subject to
tax withholding obligations of any applicable law. The Company shall also
reimburse you in accordance with the Company's policies for unpaid out-of-pocket
expenses incurred in the furtherance of your duties for the Company through the
Effective Date which are submitted to the Company in a written expense report no
later than 15 days after the date hereof. By execution hereof, you hereby
acknowledge and agree that the provisions of this Severance Agreement provide
consideration to you that exceeds Company's obligations under the Employment
Agreement.
You shall have the right to choose to continue coverage under the Company's
(or its successor's) group health plan pursuant to your rights under the
Consolidated Omnibus Budget Reconciliation Act of 1985.
3. All Company-owned manuals, letters, documents, memoranda, notes,
notebooks, reports, logs, well files, division orders, contracts, land title
files, maps, plats, charts, seismic information and all other material records
of any kind and all copies thereof that may be in your possession or under your
control which in any way pertain to the business of Company will be delivered to
Company on the Effective Date.
4. This Severance Agreement shall be in lieu of any other severance
payment, property interest or other right or benefit under that certain
Employment Agreement dated as of September 4,
September 24, 1997
Page 2
1996 (the "Employment Agreement") (including, but not limited to, the stock
option thereunder), any overriding royalty plan, working interest participation
plan, or other plan or program, whether oral or written, providing compensation
or other benefits to employees, or any severance plan arrangement (collectively,
the "Company Agreements"). The terms and provisions of the Employment
Agreement, the Company Agreements, and all of the parties' respective rights,
duties, claims and obligations, now existing or hereafter arising, are hereby
canceled, terminated, released and discharged in full; provided, however, that
nothing herein shall terminate that certain Letter Agreement of even date
herewith (the "Letter Agreement") among Faulkinberry Oil and Gas Company, Inc.
("FOG"), you and your wife, and XPLOR relating to the purchase by XPLOR of the
stock of FOG, and (ii) the terms and conditions of Section 5 of your Employment
Agreement will apply with respect to the AMIs (as defined pursuant to that
certain letter agreement between XPLOR and Michael W. Englert date September 23,
1997). You agree that you have no claim, interest or right to the oil and gas
properties and rights now owned or hereafter acquired by Company or any
affiliate of Company, except as set forth in the Letter Agreement.
5. Exploration, Araxas and XPLOR, individually and on behalf of each of
their respective subsidiaries, affiliates and representatives (collectively,
with Exploration, Araxas and XPLOR, the Araxas Affiliates"), hereby release and
discharge you from any and all liability, actions, claims and demands of any
kind whatsoever which the Araxas Affiliates may have now or in the future
arising from any action or omission by you occurring with respect to your
employment pursuant to the Employment Agreement, except to the extent of any
backup or other similar withholding obligation, if any, applicable to amounts
paid under the Letter Agreement for which you agree to indemnify and hold the
Araxas Affiliates harmless. You hereby release and discharge the Araxas
Affiliates and their respective officers, directors, agents and employees from
any and all liability, actions, claims and demands of any kind whatsoever which
you may have arising now or in the future from any action or omission by any of
them with respect to your employment pursuant to the Employment Agreement;
provided, however, that this release shall not apply to any duties and
responsibilities of the Araxas Affiliates with respect to the Letter Agreement.
Except as specifically set forth above, the foregoing releases are intended to
be full and complete releases of all current and future claims of any kind
whatsoever, whether known or unknown, or whether arising in tort, contract, or
otherwise.
6. This Agreement shall be governed by and construed in accordance with
the laws of the State of Texas.
7. This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns, and your personal
representative.
September 24, 1997
Page 3
If the foregoing accurately sets forth our agreement with respect to your
severance agreement, please evidence your agreement by executing this letter in
the space provided below and return it to me.
Very truly yours,
ARAXAS ENERGY CORPORATION
XPLOR ENERGY, INC.
By: /s/ Steven W. Nance
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Steven W. Nance,
President and Chief Executive Officer
ARAXAS EXPLORATION, INC.
By: /s/ W. E. Rowsey, III
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W. E. Rowsey, III, President
Agreed and accepted on this 24 day of September, 1997.
/s/ John L. Faulkinberry
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JOHN L. FAULKINBERRY
Address: 42 West Rock Wing Place
The Woodlands, Texas 77381