EXHIBIT 10.29
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement"), dated effective as of July 9,
1998, is entered into by and between PINNACLE OIL INTERNATIONAL, INC., a Nevada
corporation (the "Company") and JOHN M. WOODBURY, Jr. (the "Executive"), with
reference to the following facts:
RECITALS:
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WHEREAS, the Company desires to employ the Executive as its Secretary in
order to enable the Company to avail itself of the skill, knowledge and
experience of the Executive and to assure the successful management of the
Company, and the Executive desires to become employed in such executive officers
position or positions;
WHEREAS, the Company also desires to employ the Executive as its interim
Chief Financial Officer (Treasurer) unless and until such time as it may prove
necessary to engage a person with a broader accounting and financial background
to perform such function, and the Executive is willing to accept such executive
position on such basis; and
WHEREAS, the Company and the Executive desire to enter into a written
employment agreement formally documenting their relationship and setting forth
the duties and responsibilities the Company desires the Executive to undertake,
and which the Executive has agreed to undertake.
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein, and for valuable consideration, the receipt and sufficiency of
which are hereby mutually acknowledged, the parties to this Agreement
(collectively "parties" and individually a "party") agree as follows:
AGREEMENT:
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1. DEFINITIONS
Set forth below are definitions of capitalized words or terms which
(together with those common words and terms set forth in section 17(l)) are
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generally used throughout this Agreement, or references to sections or
paragraphs containing those definitions (capitalized terms used only in a
specific section or paragraph of this Agreement are defined in that section or
paragraph):
(a) "ADVANCE" is defined in section 10.
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(b) "AFFILIATE" means any "Person" (as defined below) controlling,
controlled by, or under common control with a party.
(c) "AGREEMENT" means this Agreement, as originally executed and as
it may be: (i) amended, modified, supplemented and/or restated from time to time
(but only to the extent amended, modified, supplemented and/or restated in
accordance with the terms of this Agreement); and/or (ii) renewed or extended in
accordance with its terms.
(d) "APPLICABLE LAWS" means any federal, state local or foreign laws
or regulations as may be applicable.
(e) "BOARD" means the Board of Directors of the Company, as such body
may be reconstituted from time to time.
(f) "CHANGE IN CONTROL" shall mean the occurrence of any of the
following events:
(i) A "Control Acquisition" by an "Acquiring Person" pursuant
to which Acquiring Person attains, by reason of and immediately after a
transaction or series of related transactions, "Beneficial Ownership" of
fifty percent (50%) or more of the "Total Combined Voting Power" of the
Company's then outstanding "Voting Securities." The terms in quotations in
the immediately preceding sentence shall, for purposes of this Agreement,
have the following meanings:
(1) "Acquiring Person" shall mean any "Person" which
acquires the defined percentage of securities, with the exception of:
(A) any Employee Benefit Plan (or a trust forming a part thereof)
maintained by the Company, or by any corporation or entity in which
the Company holds fifty percent (50%) or more of the "Voting
Securities" (each, a "Controlled Subsidiary"); (B) the Company or any
Controlled Subsidiary; or (C) any "Person" which acquires the
threshold percentage of "Voting Securities" through a "Non-Control
Transaction" (as defined below).
(2) "Non-Control Transaction" shall mean any transaction in
which the stockholders of the Company immediately before such
transaction, directly or indirectly own immediately following such
transaction at least a majority of the "Total Combined Voting Power"
of the outstanding "Voting Securities" of the surviving corporation
(or other entity) resulting from such transaction, in substantially
the same proportion as such stockholders' ownership of the Company's
"Voting Securities" immediately before such transaction.
(3) "Person," "Beneficial Ownership," "Total Combined
Voting Power" and "Voting Securities" shall have the meanings ascribed
to such terms in Sections 13(d) and 14(d) of the Securities Exchange
Act and Rule 13d-3 promulgated thereunder.
Notwithstanding any other provision of this subsection
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(f)(i), a Change In Control shall not be deemed to have occurred solely
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because any Person acquired Beneficial Ownership of more than the threshold
percentage of the outstanding Voting Securities as a result of an
acquisition of Voting Securities by the Company (each, a "Redemption")
which, by reducing the number of Voting Securities outstanding, increased
the percentage of outstanding Voting Securities Beneficially Owned by such
Person; provided, however, that if (A) a Change In Control would occur as a
result of a Redemption but for the operation of this sentence, and (B)
after such Redemption, such Person becomes the Beneficial Owner of any
additional Voting Securities, which increase the percentage of the then
outstanding Voting Securities Beneficially Owned by such Person over the
percentage owned as a result of the Redemption, then a Change In Control be
deemed to occur.
(ii) During any period of three (3) consecutive years after the
date of this Agreement, the individuals who constituted the Board at the
beginning of such period (the "Incumbent Board") cease to constitute a
majority of the Board, for any reason(s) other than (1) the voluntary
resignation of one or more Board members; (2) the refusal by one or more
Board members to stand for election to the Board; and/or (3) the removal of
one or more Board members for good cause; provided, however, (A) that if
the nomination or election of any new
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director of the Company was approved by a vote of at least a majority of
the Incumbent Board, such new director shall be deemed a member of the
Incumbent Board; and (B) that no individual shall be considered a member of
the Incumbent Board if such individual initially assumed office as a result
of either an actual or threatened "Election Contest" (as described in Rule
14a-11 promulgated under the Securities Exchange Act of 1934), or as a
result of a solicitation of proxies or consents by or on behalf of an
Acquiring Person, other than a member of the Board (a "Proxy Contest"), or
as a result of any agreement intended to avoid or settle any Election
Contest or Proxy Contest.
(iii) The Board or the stockholders of the Company approve:
(1) A merger or consolidation or reorganization of the
Company reorganization (each, a "Major Event") with (A) any Controlled
Subsidiary, and the terms of the proviso to this subsection (f)(iii)
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are not satisfied; or (B) any other corporation or other entity;
unless such Major Event is a Non-Control Transaction; or
(2) A complete liquidation or dissolution of the Company,
and the terms of the proviso to subsection (f)(iii) are not satisfied;
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or
(3) An agreement for the sale or other disposition of all
or substantially all of the assets of the Company to (A) any
Controlled Subsidiary, and the terms of the proviso to subsection
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(f)(iii) are not satisfied, or (B) to any other Voting Person.
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Notwithstanding any other provision of this subsection
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(f)(iii), if the Executive or an Affiliate of the Executive who is then a
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stockholder or director of the Company, either: (i) expressly voted in
favor of the transaction constituting the Change In Control in such
Person's capacity as either a stockholder or as a director of the Company;
or (ii) expressly abstained from voting (other than by reason of an
"interest" in a matter or transaction, as defined in the Nevada Revised
Statutes); and/or (iii) failed or refused to vote, then the transaction
shall not constitute a Change in Control.
(g) "CODE" means the Internal Revenue Code of 1986, as amended
(references herein to sections of the Code are intended to refer to sections of
the Code as presently enacted and as subsequently amended, or to any
substantially similar successor provisions of the Code resulting from
recodification or renumbering).
(h) "COMPANY" means Pinnacle Oil International, Inc., a Nevada
Corporation, and any successor and assign of the Company, as more particularly
described in, or permitted and prescribed pursuant to, section 19(a).
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(i) "DISABILITY" (or the related term "Disabled") means any of the
following: (i) the receipt of any disability insurance benefits by the
Executive; (ii) a declaration by a court of competent jurisdiction that the
Executive is legally incompetent; (iii) the Executive's material inability due
to medically documented mental or physical illness or disability to fully
perform the Executive's regular obligations of his office and as an employee of
the Company (with reasonable accommodations for such disability, if then
required by Applicable Law), for a six (6) month continuous period, or for nine
(9) cumulative months within any one (1) year continuous period; or (iv) the
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reasonable determination by the Board that the Executive will not be able to
fully perform the Executive's regular obligations of his office and as an
employee of the Company (with reasonable accommodations if then required by
Applicable Law) for a six (6) month continuous period. If the Board determines
that the Executive is Disabled under clause (iv) above, and the Executive
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disagrees with the conclusion of the Board, then the Company shall engage a
qualified independent physician reasonably acceptable to the Executive to
examine the Executive at the Company's sole expense. The determination of such
physician shall be provided in writing to the parties and shall be final and
binding upon the parties for all purposes of this Agreement. The Executive
hereby consents to examination in the manner set forth above, and waives any
physician-patient privilege arising from any such examination as it relates to
the determination of the purported disability. If the parties cannot agree upon
a physician, a physician shall be appointed by the American Arbitration
Association located in Clark County, Nevada, according to the rules and
practices of the American Arbitration Association from time-to-time in force.
(j) "EMPLOYEE BENEFIT PLAN" is defined in section 4(c).
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(k) "EMPLOYEE DEDUCTIONS" are defined in section 6.
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(l) "MONTHLY SALARY" is defined in section 4(a).
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(m) "PERFORMANCE BONUS" is defined in section 4(b).
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(n) "PERSON" (other than for purposes of determining a Change in
Control) means an individual or natural person, a corporation, partnership
(limited or general), joint-venture, association, business trust, limited
liability company/partnership, business trust, trust (whether revocable or
irrevocable), pension or profit sharing plan, individual retirement account, or
fiduciary or custodial arrangement.
(o) "PERSONAL TIME-OFF" is defined in section 7.
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(p) "SUBSIDIARY" shall mean any corporation, partnership (limited or
general), joint-venture, association, business trust, limited liability
company/partnership, business trust or trust in which the Company holds a
controlling interest, including but not limited to Pinnacle Oil, Inc., a Nevada
corporation ("Pinnacle Oil"), and Pinnacle Oil Canada, Inc., a British Columbia
corporation ("Pinnacle Canada").
(q) "TERMINATION BY COMPANY FOR CAUSE" means a termination of the
Executive caused by a determination of two-thirds of the Board, excluding the
Executive if then a member of the Board, that one of the following events has
occurred:
(i) Any of the Executive's representations or warranties in
this Agreement is not materially true, accurate and/or complete;
(ii) The Executive has intentionally and continually breached or
wrongfully failed and/or refused to fulfill and/or perform (A) any of the
Executive's obligations, promises or covenants under this Agreement, or (B)
any of the warranties, obligations, promises or covenants in any agreement
(other than this Agreement) entered into between the Company and the
Executive, without cure, if any, as provided in such agreement;
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(iii) The Executive has intentionally failed and/or refused to
obey any lawful and proper order or directive of the Board, and/or the
Executive has intentionally interfered with the compliance by other
employees of the Company with any such orders or directives;
(iv) The Executive has intentionally breached the Executive's
fiduciary duties to the Company;
(v) The Executive has intentionally caused the Company to be
convicted of a crime, or to incur criminal penalties in material amounts;
(vi) The Executive has committed: (A) any act of fraud,
misrepresentation, theft, embezzlement or misappropriation, and/or any
other dishonest act against the Company and/or any of its Affiliates,
subsidiaries, joint ventures; or (B) any other offense involving moral
turpitude, which offense is followed by conviction or by final action of
any court of law; or (C) a felony;
(vii) The Executive repeatedly and intemperately used alcohol or
drugs, to the extent that such use (A) interfered with or is likely to
interfere with the Executive's ability to perform the Executive's duties,
and/or (B) endangered or is likely to endanger the life, health, safety, or
property of the Executive, the Company, or any other person;
(viii) The Executive has intentionally demonstrated or committed
such acts of racism, sexism or other discrimination as would tend to bring
the Company into public scandal or ridicule, or could otherwise result in
material and substantial harm to the Company's business, reputation,
operations, affairs or financial position; and/or
(ix) The Executive engaged in other conduct constituting legal
cause for termination.
No act, nor failure to act, on the Executive's part shall be
considered "intentional" unless the Executive has acted, or failed to act, with
a lack of good faith and with a lack of reasonable belief that the Executive's
action or failure to act was in the best interests of the Company. In the event
the Executive is both Disabled and the provisions of clause (vii) of this
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subsection (q) are applicable, the Company shall nevertheless have the right to
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deem such event as a Termination By Company For Cause.
If any event described above in clause (ii) or clause (viii) of this
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subsection (q) occurs, and such event is reasonably susceptible of being cured,
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then the Executive shall be entitled to a grace period of thirty (30) days
following receipt of written notice of such event. If the Company determines,
in its sole discretion, that such event is not reasonably susceptible of being
cured within a period of thirty (30) days), the Company may grant a longer cure
period to the Executive to cure such event to the reasonable satisfaction of the
Company, provided the Executive promptly commences and diligently pursues such
cure. The noted grace periods shall not apply to any other event described in
this subsection (q).
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(r) TERMINATION EXECUTIVE FOR GOOD REASON" means the Executive's
termination of this Agreement based on his reasonable determination that one of
the following events has occurred:
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(i) Any of the Company's representations or warranties in this
Agreement is not materially true, accurate and/or complete;
(ii) The Company intentionally and continually breached or
wrongfully failed to fulfill or perform (A) its obligations, promises or
covenants under this Agreement; or (B) any warranties, obligations,
promises or covenants of the Company in any agreement (other than this
Agreement) entered into between the Company and the Executive, without
cure, if any, as provided in such agreement;
(iii) The Company terminated this Agreement and the Executive's
employment hereunder (with the exception of Treasurer), and such
termination does not constitute Termination By Company For Cause;
(iv) Without the consent of the Executive, the Company: (A)
substantially altered or materially diminished the position, nature,
status, prestige or responsibilities of the Executive from those in effect
by mutual agreement of the parties from time-to-time; (B) assigned
additional duties or responsibilities to the Executive which were wholly
and clearly inconsistent with the position, nature, status, prestige or
responsibilities of the Executive then in effect; or (C) removed or failed
to reappoint or re-elect the Executive to the Executive's offices under
this Agreement (as they may be changed or augmented from time-to-time with
the consent of the Executive), or as a director of the Company, except in
connection with the Disability of the Executive;
(v) Without the consent of the Executive, the Company
relocated the Company's principal operating offices from their present
location, and as a result increased the Executive's ordinary commute from
the Executive's temporary residence by more than thirty-five (35) miles;
(vi) Without the consent ratification (express or implied) of
the Executive, the Executive was removed from the Board without his
consent; or the Company failed to nominate or reappoint the Executive to
the Board (unless the Executive is deceased or Disabled, or such removal or
failure is attributable to an event which would constitute Termination By
Company For Cause), or if the Executive was so nominated, the stockholders
of the Company failed to re-elect the Executive to the Board;
(vii) The Company intentionally required the Executive to commit
or participate in any felony or other serious crime; and/or
(viii) The Company engaged in other conduct constituting legal
cause for termination.
In the event any of the events described above in this subsection (r)
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occurs, and such event is reasonably susceptible of being cured, the Company
shall be entitled to a grace period of thirty (30) days following receipt of
written notice of such event. If the Company determines, in its sole discretion,
that such event is not reasonably susceptible of being cured within a period of
thirty (30) days), the Company may grant a longer cure period to the Executive
to cure such event to the reasonable satisfaction of the Company, provided the
Executive promptly commences and diligently pursues such cure. The noted grace
periods shall not apply to any other event described in this subsection (r).
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2. EMPLOYMENT OBLIGATIONS
(a) ENGAGEMENT; DUTIES. The Company hereby engages the Executive as
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its Secretary and, until such time as it may prove necessary to engage a person
with a broader accounting background to perform such function; as the its
interim Chief Financial Officer (Treasurer), and the Executive accepts such
engagement, upon the terms and conditions set forth below. As Secretary and
Chief Financial Officer (Treasurer) of the Company, the Executive shall do and
perform all services, acts, or things as such executive officers would
customarily be empowered and authorized to do, and perform by law and under the
Company's Bylaws, as well as such additional things, including both business and
legal, that a person with the Executive's skill, knowledge and background could
or would perform.
The Executive shall report only to the President, Chief Executive
Officer and Board, and any significant employment decisions and/or agreements,
contracts and/or joint ventures negotiated by the Executive shall be subject to
the review and approval/ratification by any of such parties. The Executive's
responsibilities with respect to the Company and each of its Subsidiaries may be
changed or supplemented by the Board from time-to-time, in their discretion.
The Executive shall also hold such offices with the Subsidiaries and/or joint
ventures of the Company as the Board may, in its discretion and with the consent
of the Executive, from time-to-time determine. The Board shall determine the
amount of the Executive's total remuneration which will be allocated to and paid
by the Company and by each of its Subsidiaries. The Executive shall be
reasonably available to travel as the needs of the Company's business may
require.
(b) PERFORMANCE. The Executive shall devote the Executive's entire
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and undivided business time, energy, abilities and attention solely and
exclusively to the performance of the Executive's duties hereunder and the
business of the Company (and/or its Subsidiaries); provided, however, the
Executive may devote a portion of the Executive's business time, energy,
abilities and attention to such other outside business matters as consented to
by the President, Chief Executive Officer and/or the Board, so long as such
performance does not materially impair the performance of the Executive in
discharging the Executive's duties hereunder. The Executive shall at all times
faithfully, loyally, conscientiously, diligently and, to the best of the
Executive's ability, perform all of the Executive's duties and obligations under
this Agreement, and otherwise promote the interests and welfare of the Company
(and/or its Subsidiaries), all consistent with the highest and best standards of
the Company's industry. The Executive: (i) shall strictly comply with and adhere
to all Applicable Laws, and the Company's Articles of Incorporation, Bylaws and
policies; (ii) shall obey all reasonable rules and regulations and policies now
in effect or as subsequently modified governing the conduct of employees of the
Company, and (iii) shall not commit any acts of gross negligence, willful
misconduct, dishonesty, fraud or misrepresentation, racism, sexism or other
discrimination, or any other acts which would tend to bring the Company (and/or
its Subsidiaries) into public scandal or ridicule, or would otherwise result in
material harm to the Company's business or reputation.
(c) FACILITIES AND SERVICES. The Company (and/or its Subsidiaries)
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shall provide such support staff, facilities, equipment and supplies as are
reasonably necessary or suitable for the adequate performance of the Executive's
duties and obligations under this Agreement, including technical and secretarial
help.
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3. TERM
(a) INITIAL TERM. The Company hereby employ the Executive pursuant to
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the terms of this Agreement, and the Executive hereby accepts such employment
with the Company, for the period beginning on the date of this Agreement and
ending on July 7, 2000 (the "Initial Term").
(b) AUTOMATIC RENEWAL; TERMINATION BY THE COMPANY. Unless this
Agreement is previously terminated by either party as provided in section 11
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below, this Agreement will be automatically renewed for additional and
consecutive one (1) year terms (each, a "Renewal Term") following the expiration
of each Initial or Renewal Term, (each a "Term"), unless either party gives
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written notice to the other party, no later than sixty (60) days prior to the
expiration of the then pending Term, of its election not to automatically renew
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this Agreement for an additional year.
4. COMPENSATION
(a) MONTHLY BASE SALARY. The Company shall pay or caused to be paid
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to the Executive a monthly base salary of sixteen thousand six hundred sixty six
Canadian dollars and sixty seven cents (CDN $16,666.67) (the "Monthly Salary").
The Monthly Salary shall be payable in periodic installments as agreed from
time-to-time by the Executive and the Board, but at least semi-monthly, and
shall be subject to any Tax Withholdings and/or Employee Deductions that are
applicable. In any pay period in which the Executive shall be employed for less
than the entire number of business days in such pay period, the Monthly Salary
for such pay period shall be prorated on the basis of the number of business
days during which the Executive was actually employed during such pay period,
divided by the actual number of business days in such pay period. Commencing on
the first annual anniversary date of this Agreement, and on each annual
anniversary date thereafter, the Monthly Salary then effective shall be
increased by an amount equal to five percent (5%) of the Monthly Salary for the
immediately prior year. Additionally, commencing on or prior to the first annual
anniversary date of this Agreement, and on or prior to each annual anniversary
date thereafter, the Board shall review the Executive's Monthly Salary to
determine whether to increase the Monthly Salary by an amount in excess of said
five percent (5%) increment, without any obligation by the Board to authorize
such increase.
(b) PERFORMANCE BONUS. The Board shall from time-to-time, but not
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less than one (1) time per year, evaluate the performance of the Executive and
award to the Executive a performance bonus (the "Performance Bonus") in such
amount as the Board may determine, in its sole discretion, to be reasonable,
after taking into consideration other compensation paid or payable to the
Executive under this Agreement, as well as the financial and non-financial
progress of the business of the Company (and/or its Subsidiaries) and the
contributions of the Executive toward that progress. Payment of the Performance
Bonus shall be subject to any applicable Tax Withholdings and/or Employee
Deductions.
(c) PARTICIPATION IN EMPLOYEE BENEFIT PLANS. The Executive shall have
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the same rights, privileges, benefits and opportunities to participate in any
employee benefit plans of the Company which may now or hereafter be in effect on
a general basis for the Company's executive officers or employees, including
without limitation retirement, pension, profit-sharing, savings and insurance
(including, but not limited to, health, dental, disability and/or group
insurance) (collectively, "Employee Benefit Plans"). In the event the Executive
receives payments from a disability plan maintained by the Company, the Company
(and/or its Subsidiaries) shall have the right to offset such payments against
Monthly Salary otherwise payable to the Executive during the period for which
payments are made by such disability plan.
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5. BUSINESS EXPENSES
During the Term of this Agreement the Executive is authorized to
incur, and the Company (and/or its Subsidiaries) shall directly pay or reimburse
the Executive for his or her payment of the Executive's reasonable and necessary
business expenses, duly and actually incurred by the Executive in connection
with the duties and services to be performed by the Executive under this
Agreement, including without limitation entertainment, meals, travel, lodging
and other similar out-of-pocket expenses, upon the Executive's submission to the
Company (and/or its Subsidiaries) of itemized expense statements setting forth
the date, purpose and amount of the expense incurred, together with
corresponding receipts showing payment by the Executive in cases where he or she
seeks reimbursement, all in conformity with business expense payment and/or
reimbursement policies as may be established by the Company (and/or its
Subsidiaries) from time to time, all of which shall comply with the
substantiation requirements of the Code and any other applicable taxing
authorities, and regulations promulgated by such authorities thereto, pertaining
to the deductibility of such expenses. Direct payment and/or reimbursement
shall be made by the Company (and/or its Subsidiaries) no later than thirty (30)
days of the Executive submission of the foregoing documentation. The Executive
shall be entitled to direct payment and/or reimbursement in full for the
aforesaid business expenses, notwithstanding that the Company is prohibited
under the Code and/or regulations promulgated thereunder from deducting the
entire amount of such expenses. The Company (and/or its Subsidiaries) shall
have the option to pay directly the persons entitled to payment for such
business expenses.
6. TAX WITHHOLDINGS AND EMPLOYEE DEDUCTIONS
The Company (and/or its Subsidiaries) shall be entitled to deduct from
any payments to the Executive pursuant to the terms of this Agreement (including
any payments arising from the early termination of this Agreement), amounts
sufficient to cover applicable federal, state, local and/or foreign income tax
withholdings and/or deductions as may be required in connection with such
payment, including without limitation old-age and survivor's and other social
security payments, state disability and other withholdings payment as may be
required by law (collectively, the "Tax Withholdings"), as well as all other
elective employee deductions applicable to such payment such as, for example,
deductions relating to any Employee Benefit Plan in which the Executive
participates (collectively, the "Employee Deductions").
7. PERSONAL TIME-OFF
The Executive shall be entitled each calendar year during the term of
this Agreement to such number of personal time-off days for such purposes,
including vacations and time for personal affairs ("Personal Time-Off") as are
approved by the Board, but not less than the greater of (i) fifteen (15)
business days, or (ii) the number of personal time-off days (including vacation
and personal days) generally given by the Company to its employees. Personal
Time-Off shall be in addition to regular paid holidays provided to all employees
of the Company. The Executive's compensation shall be paid in full with respect
to approved Personal Time-Off days. Should the Executive fail to use all
Personal Time-Off days in any calendar year, the Executive shall have the option
of (i) receiving payment for such days on a pro rata basis, or (ii) "carrying-
over" unused Personal Time-Off days to succeeding years. Personal time-off
shall be taken during a period or periods mutually satisfactory to both the
Company and the Executive.
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8. INSURANCE
If requested by the Company, the Executive shall submit to such physical
examinations and otherwise take such actions and execute and deliver such
documents as may be reasonably necessary to enable the Company, at its expense
and for its own benefit, to obtain disability and/or life insurance on the life
of the Executive. The Executive represents and warrants that he has no reason to
believe that he is not insurable for disability or life coverage with a
reputable insurance company at rates now prevailing in the city of the Company's
principal executive offices, for healthy persons of the Executive's own age and
gender.
9. LOAN
The Company agrees to loan the Executive an amount equal to ten percent
(10%) of the purchase price for a residence in Calgary, such sum to be repaid
five (5) years from the date of advance, with interest payable periodically as
determined by the Company at a fixed rate of interest to be set by the Company;
provided, however, (i) in the event the Executive's employment hereunder is
terminated, and such termination is attributable to (1) an event defined as
Termination By Company For Cause; and/or (2) termination by the Executive
which does not constitute Termination By Executive For Good Reason, the loan
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(including all accrued but unpaid interest) shall be repaid within ninety (90)
days of the Executive's termination; and (ii) in the event of a Change in
Control, the term of the loan (including all accrued but unpaid interest) shall
continue on the same basis as before. Such loan shall be evidenced by such loan
documents as determined by the Company to be necessary and reasonable, and
secured by such collateral deemed by the Company to be necessary and reasonable.
10. ADVANCES
The Company (and/or its Subsidiaries) may from time-to-time, upon written
consent from the Chairman of the Board or the Board, and without any obligation
to do so, make advances to the Executive against any compensation or other
amounts to be paid by the Company (and/or its Subsidiaries) to the Executive
(each, an "Advance"). Any amounts due hereunder to the Executive shall, at the
election of the Company, be offset by any then outstanding Advances.
Subject to the terms of any written agreement relating to Advances, in
the event of termination of employment of executive, the Executive agrees that
the Company (and/or its Subsidiaries) shall have the right to offset the amount
of any and all outstanding Advance(s) against any salary or wages due, or any
other amounts due to the Executive from the Company, and that any remaining
balance of the Advance(s) shall be repaid by the Executive within thirty (30)
days after the Executive's termination date. If such Advance(s) are not repaid
within said thirty (30) days, simple interest shall accrue on the unpaid balance
at the rate of ten percent (10%) per annum. The Executive agrees to pay all
costs of collection incurred by the Company (and/or its Subsidiaries) with
respect thereto, including reasonable attorneys' fees and legal costs.
The Company's obligation to make payments to the Executive hereunder
shall not, except with respect to Advance(s) as provided above, be affected by
any circumstance, including without limitation
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any set-off, counterclaim, recoupment, defense or other right which the Company
(and/or its Subsidiaries) may have against the Executive or others.
11. TERMINATION OF AGREEMENT BEFORE EXPIRATION OF TERM
(a) DEATH OR DISABILITY. Notwithstanding any other term of this
-------------------
Agreement, the applicable Term shall terminate upon the death or Disability of
the Executive, subject to compliance with Applicable Laws.
(b) CHANGE IN CONTROL. Notwithstanding any other term of this
-----------------
Agreement,the applicable Term shall, at the election of the Executive, delivered
by written notice to the Company, terminate effective upon the Change In
Control.
(c) TERMINATION OF AGREEMENT BY COMPANY FOR CAUSE. Subject to compliance
---------------------------------------------
with Applicable Laws, the Company may terminate this Agreement and the
Executive's employment hereunder at any time in the event such termination
constitutes Termination By Company For Cause, upon giving written notice to the
Executive specifying in reasonable detail: (i) the event which constitutes the
cause; (ii) the pertinent facts and circumstances underlying the cause; and
(iii) the effective date of the termination (not to exceed ninety {90} days from
the date of such notice, but which date may, at the Company's election, be
effective upon receipt of said written notice by the Executive). Such notice
shall also afford the Executive an opportunity to be heard in person by the
Board (with the assistance of the Executive's legal counsel, if the Executive so
desires). Such hearing shall be held reasonably promptly after such notice but,
in any event, before the effective date of the prospective termination.
(d) TERMINATION OF AGREEMENT BY EXECUTIVE FOR GOOD REASON. The Executive
-----------------------------------------------------
may terminate this Agreement and the Executive's employment hereunder at any
time in the event such termination constitutes Termination By Executive For Good
Reason, upon giving written notice to the Company specifying in reasonable
detail: (i) the event which constitutes the good reason; (ii) the pertinent
facts and circumstances underling the good reason; and (iii) the effective date
of termination (not to exceed ninety {90} days from the date of such notice, but
which date may, at the Executive's election, be effective upon receipt of said
written notice by the Company).
12. EFFECT OF TERMINATION ATTRIBUTABLE TO DEATH OR DISABILITY; TERMINATION BY
COMPANY FOR CAUSE; TERMINATION BY EXECUTIVE WITHOUT GOOD REASON
In the event the Executive's employment hereunder is terminated before
the expiration of a Term, and such termination is attributable to (i) an event
defined as Death or Disability; (ii) an event defined as Termination By Company
For Cause; and/or (iii) termination by the Executive which does not constitute
---
Termination By Executive For Good Reason, then all rights and obligations of the
Company and the Executive under section 2 [Employment Obligations], section 4
--------- ---------
[Compensation], section 5 [Business Expenses] and section 7 [ Personal Time-Off]
--------- ---------
shall terminate as of the effective date of the termination; provided, however:
(a) The Company (and/or its Subsidiaries) shall pay the Executive's
accrued but unpaid Monthly Salary and Personal Time-Off days through the
effective date of the termination on or before the close of business on such
effective date; and the Executive shall not be entitled to Monthly Salary and/or
Personal Time-Off days after the effective date of the termination;
-11-
(b) The Company (and/or its Subsidiaries) shall pay any declared but
unpaid Performance Bonus;
(c) The Company (and/or its Subsidiaries) shall reimburse the Executive
for any business expenses incurred prior to the effective date of the
termination, within three (3) business days after the Executive's submission of
the Executive's expense report to the Company;
(d) The Executive shall not be entitled to continue to participate in
any Employee Benefit Plans except to the extent provided in such plans for
terminated participants, or as may be required by Applicable Law.
Notwithstanding the foregoing, amounts which are vested in any Employee Benefit
Plans shall be payable in accordance with such plan; and
13. EFFECT OF TERMINATION WHERE TERMINATION ATTRIBUTABLE TO CHANGE IN
CONTROL; TERMINATION BY EXECUTIVE FOR GOOD REASON; TERMINATION BY COMPANY
WITHOUT CAUSE
In the event the Executive's employment hereunder is terminated before
the expiration of a Term, and such termination is attributable to (i) an event
defined as a Change in Control; (ii) an event defined as a Termination by
Executive for Good Reason; and/or (iii) termination by the Company which does
not constitute a Termination By Company for Cause; then all rights and
obligations of the Company and the Executive under section 2 [Employment
---------
Obligations], section 4 [Compensation], section 5 [Business Expenses], and
--------- ---------
section 7 [Personal Time-Off] shall terminate as of the effective date of the
- ---------
termination date; provided, however:
(a) The Company (and/or its Subsidiaries) shall continue to pay the
Executive's then effective Monthly Salary through the pending Term of this
Agreement, on the same basis as previously paid to the Executive, but subject to
such minimum increases as are described in section 4;
---------
(b) The Company (and/or its Subsidiaries) shall pay the Executive's
declared but unpaid Performance Bonus;
(c) At the election of the Executive, the Company (and/or its
Subsidiaries) shall (i) permit the Executive to continue to participate in any
Employee Benefit Plans, except to the extent prohibited in such plans for
terminated employees, or as may be required by Applicable Law; or (ii) provide
the Executive with additional compensation, payable on a monthly basis, which
would approximate the cost to the Executive to obtain comparable benefits;
(d) The Company (and/or its Subsidiaries) shall reimburse the Executive
for the Executive's business expenses incurred through the effective date of the
termination, within three (3) business days of the Executive's submission of the
Executive's expense report to the Company; and
The Executive shall not be required to mitigate the amount of any payment
pursuant to this section 13 by seeking other employment or otherwise,
----------
and no such payment shall be offset or reduced by the amount of any compensation
or benefits provided to the Executive in any subsequent employment. The
provisions of this section 13 shall not be deemed to prejudice the rights of
----------
the Company or the Executive to any remedy or damages to which such party may be
entitled by reason of a breach of this Agreement by the other party, whether at
law or equity.
-12-
14. REPRESENTATIONS AND WARRANTIES OF PARTIES
(a) BY ALL PARTIES. Each of the parties to this Agreement hereby
--------------
represents and warrants to each of the other parties to this Agreement, each of
which is deemed to be a separate representation and warranty, as follows:
(i) Organization, Power and Authority. Such party, if an entity,
---------------------------------
is duly organized, validly existing and in good standing under the laws of its
state, territory or province of incorporation or organization, and has all
requisite corporate or other power and authority to enter into this Agreement.
(ii) Authorization. The execution and delivery of this Agreement
-------------
by such party, and the performance by such party of the transactions herein
contemplated, have, if such party is an entity, been duly authorized by its
governing organizational documents, and are not prohibited by its governing
organization documents, and no further corporate or other action on the part
of such party is necessary to authorize this Agreement, or the performance of
such transactions.
(iii) Validity. This Agreement has been duly executed and delivered
--------
by such party and, assuming due authorization, execution and delivery by all
of the other parties hereto, is valid and binding upon such party in
accordance with its terms, except as limited by: (1) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditor rights generally; and (2) general principles of equity
(regardless of whether such enforcement is considered in a proceeding in
equity or at law).
(iv) Non-Contravention. Neither the execution or delivery of this
-----------------
Agreement, nor the performance by such party of the transactions contemplated
herein: (1) if such party is an entity, will breach or conflict with any of
the provisions of such party's governing organizational documents; or (2) to
the best of such party's knowledge and belief, will such actions violate or
constitute an event of default under any agreement or other instrument to
which such party is a party.
(v) Legal Representation. Such party: (1) had the advice, or
--------------------
sufficient opportunity to obtain the advice, of legal counsel separate and
independent from legal counsel for any other party hereto; and (2) such party
was not represented by the legal counsel of any other party hereto in
connection with the transactions contemplated by this Agreement, nor was such
party under any belief or understanding that such legal counsel was
representing such party's interests.
(vi) Fairness. The terms and conditions of the transactions
--------
contemplated by this Agreement are fair and reasonable to such party based
upon all of the facts and circumstances at the time this Agreement is entered
into; and such party has voluntarily entered into the transactions
contemplated by this Agreement, without duress or coercion.
(b) BY EXECUTIVE. The Executive hereby represents and warrants to the
------------
Company that the Executive is not Disabled at the time of the execution and
delivery of this Agreement by the Executive.
-13-
15. PERFORMANCE ON BUSINESS DAY
In the event the date on which a party is required to take any action
under the terms of this Agreement is not a business day, the action shall,
unless otherwise provided herein, be deemed to be required to be taken on the
next succeeding business day.
16. NON-LIABILITY FOR EXECUTIVE'S DEBTS
The Executive's rights and obligations under this Agreement shall not be
subject to encumbrance or to the claims of the Executive's creditors (other than
the Company), or subject to the debts, contracts or engagements of the Executive
or the Executive's heirs, successors and assigns, and any attempt to do any of
the foregoing shall be null and void ab initio and without force and effect.
17. INTERPRETATION AND CONSTRUCTION
(a) PREPARATION OF AGREEMENT. The parties have participated jointly in
------------------------
the negotiation and drafting of this Agreement and each provision hereof. In the
event any ambiguity, conflict, omission or other question of intent or
interpretation arises, this Agreement shall be construed as if jointly drafted
by the parties, and no presumption or burden of proof shall be presumed, implied
or otherwise construed favoring or disfavoring any party by virtue of the
authorship of this Agreement or of any provision hereof.
(b) PERFORMANCE ON BUSINESS DAY. In the event the date on which a party
---------------------------
is required to take any action under the terms of this Agreement is not a
business day, the action shall, unless otherwise provided herein, be deemed to
be required to be taken on the next succeeding business day. For purposes of
this section, the term "business day" shall mean Monday through Friday
(excluding any legal holidays).
(c) SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations and
------------------------------------------
warranties made by any party in connection with any transaction contemplated by
this Agreement shall, irrespective of any investigation made by or on behalf of
any other party hereto, survive the execution and delivery of this Agreement and
the performance or consummation of any transaction described in this Agreement,
and shall continue in full force and effect forever thereafter (subject to any
applicable statutes of limitation).
(d) INDEPENDENT SIGNIFICANCE. The parties intend that each
------------------------
representation, warranty and covenant shall have independent significance. If
any party has falsely made or breached any representation, warranty or covenant
contained herein in any respect, the fact that there exists another
representation, warranty or covenant relating to the same subject matter
(regardless of the relative levels of specificity) which the party has not
falsely made or breached shall not detract from or mitigate the fact that the
party has falsely made or breached the first representation, warranty or
covenant.
(e) ENTIRE AGREEMENT; NO COLLATERAL REPRESENTATIONS. Each party
-----------------------------------------------
expressly acknowledges and agrees that this Agreement: (i) is the final,
complete and exclusive statement of the agreement of the parties with respect to
the subject matter hereof; (ii) supersede any prior or contemporaneous
agreements, memorandums, proposals, commitments, guaranties, assurances,
communications, discussions, promises, representations, understandings, conduct,
acts, courses of
-14-
dealing, warranties, interpretations or terms of any kind, whether oral or
written (collectively and severally, the "prior agreements"), and that any such
prior agreements are of no force or effect except as expressly set forth herein;
and (iii) may not be varied, supplemented or contradicted by evidence of prior
agreements, or by evidence of subsequent oral agreements. No prior drafts of
this Agreement, and no words or phrases from any prior drafts, shall be
admissible into evidence in any action or suit involving this Agreement.
(f) AMENDMENT; WAIVER; FORBEARANCE. Except as expressly provided
------------------------------
herein, neither this Agreement nor any of the terms, provisions, obligations or
rights contained herein, may be amended, modified, supplemented, augmented,
rescinded, discharged or terminated (other than by performance), except by a
written instrument or instruments signed by all of the parties to this
Agreement. No waiver of: (i) any breach of any term, provision or agreement;
(ii) the performance of any act or obligation under this Agreement; and/or (iii)
any right granted under this Agreement, shall be effective and binding unless
such waiver shall be in a written instrument or instruments signed by each party
claimed to have given or consented to such waiver. Except to the extent that the
party or parties claimed to have given or consented to a waiver may have
otherwise agreed in writing, no such waiver shall be deemed a waiver or
relinquishment of any other term, provision, agreement, act, obligation or right
under this Agreement, or of any preceding or subsequent breach thereof. No
forbearance by a party in seeking a remedy for any noncompliance or breach by
another party hereto shall be deemed to be a waiver by such forbearing party of
its rights and remedies with respect to such noncompliance or breach, unless
such waiver shall be in a written instrument or instruments signed by the
forbearing party.
(g) REMEDIES CUMULATIVE. The remedies of each party under this
-------------------
Agreement are cumulative and shall not exclude any other remedies to which such
party may be lawfully entitled.
(h) SEVERABILITY. If any term or provision of this Agreement, or the
------------
application thereof to any person or circumstance, shall to any extent be
determined to be invalid, illegal or unenforceable under present or future laws,
then, and in such event: (i) the performance of the offending term or provision
(but only to the extent its application is invalid, illegal or unenforceable)
shall be excused as if it had never been incorporated into this Agreement, and,
in lieu of such excused provision, there shall be added a provision as similar
in terms and amount to such excused provision as may be possible and still be
legal, valid and enforceable; and (ii) the remaining part of this Agreement
(including the application of the offending term or provision to persons or
circumstances other than those as to which it is held invalid, illegal or
unenforceable) shall not be affected thereby, and shall continue in full force
and effect to the fullest legal extent.
(i) TIME IS OF THE ESSENCE. Except and to the extent there is a specific
----------------------
cure provision in this Agreement, each party understands and agrees that: (i)
time of performance is strictly of the essence with respect to each and every
date, term, condition, obligation and provision hereof imposed upon such party;
and (ii) the failure to timely perform any of the terms, conditions, obligations
or provisions hereof by such party shall constitute a material breach and a
noncurable (but waivable) default under this Agreement by such party.
(j) PARTIES IN INTEREST. Nothing in this Agreement shall confer any
-------------------
rights or remedies under or by reason of this Agreement on any persons other
than the parties hereto and their respective successors and assigns, if any, or
as may be permitted hereunder; nor shall anything in this Agreement relieve or
discharge the obligation or liability of any third person to any party to this
-15-
Agreement; nor shall any provision give any third person any right of
subrogation or action against any party to this Agreement.
(k) NO RELIANCE UPON PRIOR REPRESENTATIONS. Each party acknowledges
--------------------------------------
that: (1) no other party has made any oral representation or promise which would
induce such party, prior to executing this Agreement, to change such party's
position to his, her or its detriment, to partially perform, or to part with
value in reliance upon such representation or promise; and (2) such party has
not so changed its position, performed or parted with value prior to the time of
the execution of this Agreement, or such party has taken such action at its own
risk.
(l) RULES OF CONSTRUCTION. In interpreting the meaning of this
---------------------
Agreement: (i) the term "person" is defined in its broadest sense to include any
individual or natural person, entity (as such term is defined in this subsection
----------
(l)) and/or fiduciary (as such term is defined in this subsection (l)), and
- --- --------------
their respective successors and assigns; (ii) the term "entity" means any legal
entity, including any corporation, association, joint stock company, partnership
(limited, general or limited liability), joint-venture, and limited liability
company, business trust, trust (whether revocable or irrevocable), pension or
profit sharing plan, individual retirement account, or fiduciary or custodial
arrangement; (iii) the term "fiduciary" means any person acting in a fiduciary
capacity, including in their capacity as a trustee or a custodian; (iv) the term
"affiliate" means any person controlling, controlled by, or under common control
with a party (for purposes of the foregoing, the term "control" (including with
the correlative meanings, the terms "controlled by" and "under common control
with") means the possession directly or indirectly of the power to direct or
cause the direction of the management and policies of a person, whether through
the ownership of voting securities or by contract or otherwise); (v) the term
"subsidiary" means any entity in which a party holds a controlling interest;
(vi) the words "herein" and "hereunder" and other words of similar report refer
to this Agreement as a whole, and not to any particular sections, subsections,
paragraph, subparagraph or other subdivision of this Agreement; (vii) the words
"including," "includes," and "include" shall be deemed to be followed by the
words "including without limitation;" (viii) the word "or" shall not be deemed
to be exclusive unless the context indicates otherwise; and (ix) the word "all"
shall be deemed to include the word "any," and vice versa. All pronouns and any
variation thereof used in this Agreement shall be deemed to refer to the
masculine, feminine, or neuter (as the case may be), and to the singular or
plural (as the case may be), as the identity of the person or persons or the
context may require for proper interpretation of this Agreement. Any references
in this Agreement to "dollars" shall be deemed to refer to the currency of the
United States of America, unless such reference specifically references a
dollar-denominated currency of a country other than the United States of
America. The headings used in this Agreement are for convenience and reference
purposes only, and shall not be used in construing or interpreting the scope or
intent of this Agreement or any provision hereof. Each cross-references in this
Agreement shall, unless specifically directed to another agreement or document,
be construed only to refer to provisions within this Agreement, and shall not be
construed to refer to the overall transaction or to any other agreement or
document. Each exhibit, addendum, schedule and/or attachment referenced in this
Agreement shall be construed to be incorporated into this Agreement by such
reference and made a part hereof. References to any agreements (other than this
Agreement) shall include all amendments, modifications, supplements and/or
renewals thereof. Unless the context requires otherwise: (1) any reference
herein to any federal, state, local or foreign statutes or laws (collectively,
the "Statutes") will be deemed to include all rules and regulations promulgated
thereunder: and (2) any references herein to any Statute and/or any specific
section or provision of any such Statute are intended to refer to such section
or provision thereof as presently enacted and as subsequently amended,
succeeded, recodified or renumbered.
-16-
18. ENFORCEMENT
(a) GOVERNING LAW. This Agreement and the rights and remedies of each
-------------
party arising out of or relating to this Agreement (including equitable
remedies) shall be solely governed by, interpreted under, and construed and
enforced in accordance with the laws (without regard to the conflicts of law
principles) of the State of Nevada, as if this Agreement were made, and as if
its obligations were to be performed in their entirety, within the State of
Nevada.
(b) CONSENT TO SPECIFIC PERFORMANCE AND INJUNCTIVE RELIEF; WAIVER OF
----------------------------------------------------------------
BOND OR SECURITY. Each party acknowledges that each of the other
----------------
parties to this Agreement may, as a result of such party's breach of his, her or
its covenants and obligations under this Agreement, sustain substantial and
irreparable injury and damage which cannot be reasonably or adequately
compensated by damages at law. Consequently, such party agrees that the non-
breaching parties shall be entitled, in the event of such party's breach or
threatened breach of his, her or its covenants and obligations hereunder, to
obtain equitable relief from a court of competent jurisdiction including
enforcement of each provision of this Agreement by specific performance and/or
temporary, preliminary and/or permanent injunctions enforcing any of the rights
of the non-breaching parties, requiring performance by such breaching party, or
enjoining any breach by such breaching party, all without proof of any actual
damages that have been or may be caused to the non-breaching party(s) by such
breach or threatened breach, and without the posting of bond or other security
in connection therewith. The defending party waives the claim or defense therein
that any non-breaching party bringing the such action or proceeding has an
adequate remedy at law, and such defending party shall not allege or otherwise
assert the legal position that any such remedy at law exists. Each party agrees
and acknowledges that: (i) the terms of this subsection (b) are fair, reasonable
--------------
and necessary to protect the legitimate interests of the other parties to this
Agreement; (ii) this waiver is a material inducement to each of the other
parties to enter into the transactions contemplated hereby; and (iii) each of
the other parties relied upon this waiver in entering into this Agreement; and
will continue to rely on this waiver in their future dealings with such party.
Each party represents and warrants that such party has reviewed this provision
with such party's legal counsel, and that such party has knowingly and
voluntarily waived his, her or its rights following consultation with legal
counsel.
(c) RECOVERY OF FEES AND COSTS. If any party institutes, or should any
--------------------------
party otherwise become a party to, any action or proceeding based upon or
arising out of this Agreement, including the enforcement or interpretation of
this Agreement or any provision hereof, or for damages by reason of any alleged
breach of this Agreement or any provision hereof, or for a declaration of rights
in connection herewith, or for any other relief, including equitable relief, in
connection herewith, the "prevailing party" (as such term is defined below) in
any such action or proceeding, whether or not such action or proceeding proceeds
to final judgment or determination, shall be entitled to receive from the non-
prevailing party as a cost of suit, and not as damages, all fees, costs and
expenses of enforcing any right of the prevailing party (collectively, "fees and
costs"), including: (i) reasonable attorneys' fees and costs and expenses; (ii)
witness fees (including experts engaged by the parties, but excluding officers,
directors, employees, managers or general partners of the parties); (iii)
accountants' fees; (iv) fees of other professionals and (v) any and all other
similar fees incurred in the prosecution or defense of the action or proceeding;
including the following: (1) postjudgment motions; (2) contempt proceedings; (3)
garnishment, levy, and debtor and third party examinations; (4) discovery and
(5) bankruptcy litigation. All of the aforesaid fees and costs shall be deemed
to have accrued upon the commencement of such action, and shall be paid whether
or not such action is prosecuted to judgment. Any judgment or order entered in
such action shall contain a specific provision providing for the recovery of the
aforesaid fees, costs and expenses incurred in enforcing such judgment and an
award of prejudgment interest from
-17-
the date of the breach at the maximum rate of interest allowed by law. The term
"prevailing party" is defined as the party who is determined to prevail by the
court after its consideration of all damages and equities in the action or
proceeding (the court shall retain the discretion to determine that no party is
the prevailing party, in which case no party shall be entitled to recover its
fees and costs under this subsection (c)).
--------------
19. ASSIGNMENT AND DELEGATION; SUCCESSORS AND ASSIGNS.
(a) ASSIGNMENT OR DELEGATION. Except as specifically provided in this
------------------------
Agreement, neither party (an "assigning party") may directly or indirectly sell,
license, transfer or assign (whether through a merger, consolidation,
conversion, sale of assets, sale or exchange of securities, or by operation of
law, or otherwise) any of such party's rights or interests under this Agreement,
or delegate any of such party's duties or obligations under this Agreement, in
whole or in part, including to any subsidiary or to any affiliate, without the
prior written consent of the other party (a "consenting party"), which consent
may be withheld in the consenting party's sole and absolute discretion;
provided, however:
(i) Subject to prior compliance with subsection (iii) and
----------------
subsection (iv) below, an assigning party may assign all of the rights and
---------------
interests and delegate all of the duties and obligations of the assigning
party under this Agreement in connection with a transaction whose principal
purpose is to change the State in which the assigning party is incorporated,
or to form a holding company, or to effect a similar reorganization as to form
of entity without change of beneficial ownership, including through: (1) a
merger or consolidation or stock exchange or divisive reorganization (i.e.,
spin-off, split-off or split-up) or other reorganization with respect to the
assigning party and/or its stockholders; or (2) the sale, transfer, exchange
or other disposition by the assigning party of its assets in a single or
series of related transactions, so long as such transferee, purchaser or
surviving person shall expressly assume such obligations of the assigning
party;
(ii) Subject to subsection (iii) and subsection (iv) below, an
---------------- ---------------
assigning party may, with the prior written consent of the consenting party,
which consent the consenting party may withhold in its sole and absolute
discretion, assign all of the rights and interests and delegate all of the
duties and obligations of the assigning party under this Agreement to any
other person in connection with the transfer or sale of the entire business of
the assigning party (other than with respect to a sale described in subsection
----------
(i) above), or the merger or consolidation of the assigning party with or into
---
any other person (other than with respect to a merger or consolidation
described in subsection (i) above), so long as such transferee, purchaser or
--------------
surviving person shall expressly assume such obligations of the assigning
party;
(iii) Notwithstanding anything in subsection (i) or subsection (ii)
-------------- ---------------
above to the contrary, no assignment or transfer under subsection (i) or
--------------
subsection (ii) may be effectuated unless the proposed transferee or assignee
---------------
first executes such agreements (including a restated Employment Agreement) in
such form as the consenting party may deem reasonably satisfactory to: (1)
evidence the assumption by the proposed transferee or assignee of the
obligations of the assigning party; and (2) to ensure that the consenting
party continues to receive such rights, benefits and protections (both legal
and economic) as were contemplated by the consenting party when entering into
this Agreement; and
-18-
(iv) Notwithstanding anything in subsection (i) or subsection (ii)
-------------- ---------------
above to the contrary: (1) any assumption by a successor or assign under
subsection (i) or subsection (ii) above shall in no way release the assigning
-------------- ---------------
party from any of its obligations or liabilities under this Agreement; and (2)
and any merger, consolidation, reorganization, sale or conveyance under
subsection (i) or subsection (ii) above shall not be deemed to abrogate the
-------------- ---------------
rights of the consenting party elsewhere contained in this Agreement,
including those resulting from a Change In Control.
Any purported assignment or transfer in violation of the terms of
this subsection (ii) shall be null and void ab initio and of no force and
---------------
effect, and shall vest no rights or interests in the purported assignee or
transferee.
(b) SUCCESSORS AND ASSIGNS. Subject to subsection (b) above, each and
----------------------
every representation, warranty, covenant, condition and provision of this
Agreement as it relates to each party hereto shall be binding upon and shall
inure to the benefit of such party and his, her or its respective successors and
permitted assigns, spouses, heirs, executors, administrators and personal and
legal representatives, including any successor (whether direct or indirect, or
by merger, consolidation, conversion, purchase of assets, purchase of securities
or otherwise).
20. MISCELLANEOUS
(a) COSTS AND EXPENSES. Except as expressly set forth in this
------------------
Agreement, each party shall pay all legal and other fees, costs and expenses
incurred or to be incurred by such party in negotiating and preparing this
Agreement; in performing due diligence or retaining professional advisors; and
in complying with such party's covenants, agreements and conditions contained
herein.
(b) COOPERATION. Each party agrees, without further consideration, to
-----------
cooperate and diligently perform any further acts, deeds and things, and to
execute and deliver any documents that may be reasonably necessary or otherwise
reasonably required to consummate, evidence, confirm and/or carry out the intent
and provisions of this Agreement, all without undue delay or expense.
(c) NOTICES. Unless otherwise specifically provided in this Agreement,
-------
all notices, demands, requests, consents, approvals or other communications
(collectively and severally called "notices") required or permitted to be given
hereunder, or which are given with respect to this Agreement, shall be in
writing, and shall be given by: (i) personal delivery (which form of notice
shall be deemed to have been given upon delivery), (ii) by telegraph or by
private airborne/overnight delivery service (which forms of notice shall be
deemed to have been given upon confirmed delivery by the delivery agency), (iii)
by electronic or facsimile or telephonic transmission, provided the receiving
party has a compatible device or confirms receipt thereof (which forms of notice
shall be deemed delivered upon confirmed transmission or confirmation of
receipt), or (iv) by mailing in the United States mail by registered or
certified mail, return receipt requested, postage prepaid (which forms of notice
shall be deemed to have been given upon the fifth {5th} business day following
the date mailed. Notices shall be addressed at the addresses first set forth
below, or to such other address as the party shall have specified in a writing
delivered to the other parties in accordance with this paragraph. Any notice
given to the estate of a party shall be sufficient if addressed to the party as
provided in this subsection (c).
--------------
If to the Company: Pinnacle Oil International, Inc.
840 - 7th Avenue, SW
Calgary, Alberta, Canada T2P 3G2
If to Executive: John M. Woodbury, Jr.
_______________________
_______________________
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(d) COUNTERPARTS; ELECTRONICALLY TRANSMITTED DOCUMENTS. This Agreement
--------------------------------------------------
may be executed in counterparts, each of which shall be deemed an original, and
all of which together shall constitute one and the same instrument, binding on
all parties hereto. Any signature page of this Agreement may be detached from
any counterpart of this Agreement and reattached to any other counterpart of
this Agreement identical in form hereto by having attached to it one or more
additional signature pages. If a copy or counterpart of this Agreement is
originally executed and such copy or counterpart is thereafter transmitted
electronically by facsimile or similar device, such facsimile document shall for
all purposes be treated as if manually signed by the party whose facsimile
signature appears.
(e) EXECUTION BY ALL PARTIES REQUIRED TO BE BINDING. This Agreement
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shall not be construed to be an offer and shall have no force and effect until
this Agreement is fully executed and delivered by all parties hereto pursuant to
the terms of section20(d). Until such time as all parties fully execute this
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Agreement, any party who has previously executed and delivered this Agreement
may revoke such execution and delivery.
WHEREFORE, the parties hereto have executed this Agreement in the City
of Vancouver, Province of British Columbia, Canada, as of the date first set
forth above.
COMPANY: Pinnacle Oil International, Inc.
a Nevada Corporation
By: /s/ R. Dirk Stinson
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R. Dirk Stinson, President
EXECUTIVE: /s/ John M. Woodbury, Jr.
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John M. Woodbury, Jr.
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