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Employment & Consulting Agreement

This is an actual contract by AEI Holding.

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Sectors: Metals and Mining
Governing Law: Kentucky, View Kentucky State Laws
Effective Date: January 01, 1998
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EXHIBIT 10.5


EMPLOYMENT AND CONSULTING AGREEMENT
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This is an Employment and Consulting Agreement (this "Agreement") dated as of January __, 1998, between Leslie Resources, Inc., a Kentucky corporation ("Leslie"), AEI Holding Company, Inc., a Delaware corporation ("AEI"), and Greg Wells ("Seller"). Capitalized terms not otherwise defined herein shall have the meanings given to such terms in the Purchase Agreement (as defined below).


RECITALS
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A. Pursuant to the terms of an Amended and Restated Stock Purchase Agreement, dated December 18, 1997, (the "Purchase Agreement") among AEI, Addington Enterprises, Inc. ("Guarantor"), and Seller, AEI has agreed to purchase all of the outstanding capital stock of Leslie and Leslie Resources Management, Inc. ("LRM"). Terms not herein defined shall have the meanings accorded them in the Purchase Agreement.


B. As a condition to AEI's obligation to close the transactions contemplated in the Purchase Agreement and the Guarantor's guaranty with respect thereto, Seller has agreed to enter into this Agreement.


NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows:


1. Employment Seller shall remain as a full-time employee of Leslie
---------- after the Closing in the capacity of Vice-President and General Manager and at his current level of compensation. While so employed, Seller shall receive the same fringe benefits that are generally available to Leslie employees serving in managerial or executive capacities. Sellers employment herein shall be "AT WILL", and may be terminated by either Seller or Leslie at any time and for any reason, on thirty (30) days notice. If such termination occurs prior to January __, 2000, Seller shall still remain obligated to perform the consulting services contemplated in Paragraph 2 below and otherwise comply with the terms of this Agreement.


2. Consulting Services. Seller covenants and agrees that, from and after
------------------- the date of any termination of his employment with Leslie that occurs prior to January __, 2000, Seller shall provide such consulting services as may reasonably be requested by officers or directors of Leslie or AEI, including, without limitation, advising Leslie and AEI in connection with maintaining good relations with the Companies' and Subsidiaries' employees. Seller's duty to render consulting services as set forth in this Paragraph 2 shall terminate on January __, 2000. Leslie or AEI shall pay Seller Five Hundred Dollars ($500) per day for each day that Leslie or AEI requests, and Seller renders, such consulting services.


3. Non-Competition
---------------


(a) Seller covenants and agrees that, from and after the date of this Agreement for a period of two (2) years, Seller shall not, directly or indirectly (whether as proprietor, stockholder, director, officer, partner, employee, trustee, beneficiary, or in any other capacity), acquire coal reserves in any of Perry, Knott, Letcher, Clay, Leslie, or Breathitt Counties, Kentucky, conduct coal mining operations in any of Perry, Knott, Letcher, Clay, Leslie, or Breathitt Counties, Kentucky, or sell coal to any person or entity presently doing business with Leslie, AEI, Guarantor or any of their Affiliates; provided, however, that: (i) Seller shall not be prohibited from removing coal from the properties identified in Exhibit A (the "Properties") in connection with the development by Seller of the Properties for commercial purposes, provided, however, that Leslie and AEI shall have the right of first refusal for any coal removed from the Properties and no such coal may be sold to any Person other than Leslie and AEI unless Leslie and AEI have been offered to purchase the coal on terms and conditions identical to the sale to another Person; (ii) Resource Trucking, Inc., a Kentucky corporation ("Resource Trucking"), shall not be prohibited from hauling coal; and (iii) Mountain Properties, a Kentucky corporation, may continue to own and lease properties owned as of the Closing Date for the mining of coal, but during such period shall not acquire any additional property to be leased or used as coal reserves or for coal mining purposes in any of Perry, Knott, Letcher, Clay, Leslie, or Breathitt Counties, Kentucky, and upon termination or expiration of any such leases, Leslie and AEI shall have a right of first refusal as to any future sale or lease of such properties until January __, 2000, or as otherwise mutually agreed in writing. Nothing contained herein shall be deemed to require AEI, any Company or any Subsidiary to continue using the services of Resource Trucking after the Closing, or to require Resource Trucking to continue providing coal hauling services after the Closing.


(b) Seller covenants and agrees that, from and after the date of this Agreement for a period of four (4) years, Seller shall not, directly or indirectly (whether as proprietor, stockholder, director, officer, partner, employee, trustee, beneficiary, or in any other capacity), hire any employee of any Company or any Subsidiary or solicit such person to terminate his or her employment with any Company or Subsidiary, as the case may be. This covenant shall not preclude Seller from hiring any employee whose employment with the Company or any subsidiary was involuntarily terminated through firing or layoff or whose employment was voluntarily terminated by the employee (without solicitation by Seller) more than six (6) months prior to Seller's hiring of such employee.


4. Scope of Covenant. Seller acknowledges and agrees that (a) the
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